Exhibit 10.22

 

DOMESTIC
SECURITY AGREEMENT

 

THIS DOMESTIC SECURITY AGREEMENT (as amended and modified from time to time,
this “Domestic Security Agreement”) dated as of January 30, 2008 is by and among
the parties identified as “Grantors” on the signature pages hereto and such
other parties as may become Grantors hereunder after the date hereof
(individually a “Grantor”, and collectively the “Grantors”) and BANK OF AMERICA,
N.A., as collateral agent under the Intercreditor Agreement (defined below) (in
such capacity, the “Collateral Agent”) for the holders of the Secured
Obligations referenced below.

 

W I T N E S S E T H

 

WHEREAS, pursuant to that certain Note Purchase Agreement, dated as of the date
hereof (as amended, modified or supplemented from time to time, the “2008 Note
Agreement”), among the GFI Group, Inc. (the “Company”) and the institutional
investors signatory thereto (collectively, the “2008 Purchasers”), the Company
has issued and sold to the 2008 Purchasers $60,000,000 in aggregate principal
amount of the Company’s 7.17% Senior Notes due January 30, 2013 (together with
all notes issued in substitution or exchange therefor or in replacement thereof
in accordance with the terms of the 2008 Note Agreement, the “2008 Senior
Notes”);

 

WHEREAS, in connection with the 2008 Note Agreement, certain Domestic
Subsidiaries (each, a “Subsidiary Guarantor” and collectively, the “Subsidiary
Guarantors”) of the Company are executing and delivering to the 2008 Purchasers
a Subsidiary Guaranty Agreement, dated as of the date hereof, pursuant to which
such Domestic Subsidiaries guarantee to the 2008 Purchasers all of the Company’s
obligations under the Note Documents; and

 

WHEREAS, this Domestic Security Agreement is required under the terms of the
2008 Note Agreement.

 

NOW, THEREFORE, in consideration of these premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

 

SECTION 1.                                                 DEFINITIONS.

 

                (a)       Capitalized terms used and not otherwise defined
herein shall have the meanings provided in the 2008 Note Agreement.

 

                (b)       The following terms shall have the meanings assigned
thereto in the Uniform Commercial Code in effect in the State of New York on the
date hereof:  Accession, Account, As-Extracted Collateral, Chattel Paper,
Commercial Tort Claim, Consumer Goods, Deposit Account, Document, Equipment,
Farm Products, Fixtures, General Intangible, Goods,

 

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Instrument, Inventory, Investment Property, Letter-of-Credit Right, Manufactured
Home, Proceeds, Software, Standing Timber, Supporting Obligation and Tangible
Chattel Paper.

 

                (c)       As used herein, the following terms shall have the
meanings set forth below:

 

“Collateral” has the meaning provided in Section 2 hereof.

 

“Copyright License” means any written agreement, naming any Grantor as licensor,
granting any right under any Copyright.

 

“Copyrights” means (a) all copyrights registered in the United States or any
other country in all Works, now existing or hereafter created or acquired, all
registrations and recordings thereof, and all applications in connection
therewith, including, without limitation, registrations, recordings and
applications in the United States Copyright Office or in any similar office or
agency of the United States, any state thereof or any other country or political
subdivision thereof, or otherwise, and (b) all renewals thereof.

 

“Credit Agreement” means that certain Credit Agreement dated as of February 24,
2006 (as amended or modified from time to time) among the Company and GFI
Holdings Limited as the borrowers, the guarantors party thereto, the lenders
party thereto and Bank of America, N.A. as administrative agent for the lenders.

 

“Debtor Relief Laws” means the Bankruptcy Code of the United States of America,
and all other liquidation, conservatorship, bankruptcy, assignment for the
benefit of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States of America or
other applicable jurisdictions from time to time in effect and affecting the
rights of creditors generally.

 

“Domestic Subsidiary”: any Subsidiary of the Company organized under the laws of
the United States or any jurisdiction thereof.

 

“Foreign Subsidiary”: any Subsidiary of the Company organized under the laws of
a jurisdiction other than the United States or any jurisdiction thereof.

 

“Intercreditor Agreement” means that certain intercreditor agreement dated as of
the date hereof among the 2008 Purchasers, the Company, the Collateral Agent,
Bank of America, N.A. in its capacity as administrative agent under the Credit
Agreement and Subsidiary Guarantors party thereto.

 

“Patent License” means any agreement, whether written or oral, providing for the
grant by or to a Grantor of any right to manufacture, use or sell any invention
covered by a Patent.

 

“Patents” means (a) all letters patent of the United States or any other country
and all reissues and extensions thereof, and (b) all applications for letters
patent of the United States or any other country and all divisions,
continuations and continuations-in-part thereof.

 

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“Secured Obligations” means, without duplication, (i) all of the obligations of
the Company and the Subsidiary Guarantors to the 2008 Purchasers under the 2008
Note Agreement and the other Note Documents (including, but not limited to, any
interest accruing after the commencement by or against the Company or any
Subsidiary Guarantor of a proceeding under any Debtor Relief Laws, regardless of
whether such interest is an allowed claim under such proceeding), whether now
existing or hereafter arising, due or to become due, direct or indirect,
absolute or contingent, howsoever evidenced, created, held or acquired, whether
primary, secondary, direct, contingent, or joint and several, as such
obligations may be amended, modified, increased, extended, renewed or replaced
from time to time, and (ii) all costs and expenses incurred in connection with
enforcement and collection of the foregoing obligations, including reasonable
attorney’s fees.

 

“Trademark License” means any agreement, written or oral, providing for the
grant by or to a Grantor of any right to use any Trademark.

 

“Trademarks” means (a) all trademarks, trade names, corporate names, company
names, business names, fictitious business names, trade styles, service marks,
logos and other source or business identifiers, and the goodwill associated
therewith, now existing or hereafter adopted or acquired, all registrations and
recordings thereof, and all applications in connection therewith, whether in the
United States Patent and Trademark Office or in any similar office or agency of
the United States, any state thereof or any other country or any political
subdivision thereof, or otherwise and (b) all renewals thereof.

 

“UCC” means the Uniform Commercial Code.

 

“Work” means any work that is subject to copyright protection pursuant to Title
17 of the United States Code.

 

SECTION 2.                                                 GRANT OF SECURITY
INTEREST IN THE COLLATERAL.

 

To secure the prompt payment and performance in full when due, whether by lapse
of time, acceleration, mandatory prepayment or otherwise, of the Secured
Obligations, each Grantor hereby grants to the Collateral Agent, for the benefit
of the holders of the Secured Obligations, a continuing security interest in,
any and all right, title and interest of such Grantor in and to all of the
following, whether now owned or existing or owned, acquired, or arising
hereafter (collectively, the “Collateral”):

 

                   (a)        all Accounts (excluding, for the avoidance of
doubt, customer accounts that are not accounts of such Grantor);

 

                   (b)        all cash and currency;

 

                   (c)        all Chattel Paper;

 

                   (d)        those Commercial Tort Claims identified on
Schedule 2(d) attached hereto;

 

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                   (e)        all Copyrights;

 

                    (f)        all Copyright Licenses;

 

                   (g)        all Deposit Accounts;

 

                   (h)        all Documents;

 

                    (i)        all Equipment;

 

                    (j)        all Fixtures;

 

                   (k)        all General Intangibles;

 

                    (l)        all Goods;

 

                  (m)        all Instruments;

 

                   (n)        all Inventory;

 

                   (o)        all Investment Property;

 

                   (p)        all Letter-of-Credit Rights;

 

                   (q)        all Patents;

 

                    (r)        all Patent Licenses;

 

                   (s)        all Software;

 

                    (t)        all Supporting Obligations;

 

                   (u)        all Trademarks;

 

                   (v)        all Trademark Licenses; and

 

                  (w)        to the extent not otherwise included, all
Accessions and all Proceeds of any and all of the foregoing.

 

Notwithstanding anything to the contrary contained herein, the security
interests granted under this Domestic Security Agreement shall not extend to
(i) any permit, lease, license, contract or other instrument of a Grantor if the
grant of a security interest in such permit, lease, license, contract or other
instrument (including, without limitation, any purchase agreement and any assets
subject to a purchase money security interest in respect thereof) in the manner
contemplated by this Domestic Security Agreement, under the terms thereof or
under applicable law, is prohibited and would result in the termination thereof
or give the other parties thereto the

 

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right to terminate, accelerate or otherwise alter such Grantor’s rights, titles
and interests thereunder (including upon the giving of notice or the lapse of
time or both); provided that any such limitation on the security interests
granted hereunder shall only apply to the extent that (A) after reasonable
efforts, consent from the relevant party or parties has not been obtained and
(B) any such prohibition could not be rendered ineffective pursuant to the UCC
or any other applicable law (including Debtor Relief Laws) or principles of
equity, (ii) any Capital Stock in any Subsidiary and (iii) any Pledged
Collateral (as defined in the Domestic Pledge Agreement).

 

The Grantors and the Collateral Agent, on behalf of the holders of the Secured
Obligations, hereby acknowledge and agree that the security interest created
hereby in the Collateral (i) constitutes continuing collateral security for all
of the Secured Obligations, whether now existing or hereafter arising and
(ii) is not and shall not be construed as an assignment of any Copyrights,
Copyright Licenses, Patents, Patent Licenses, Trademarks or Trademark Licenses.

 

SECTION 3.                                                 PROVISIONS RELATING
TO ACCOUNTS.

 

                (a)       Anything herein to the contrary notwithstanding, each
of the Grantors shall remain liable under each of the Accounts to observe and
perform all the conditions and obligations to be observed and performed by it
thereunder, all in accordance with the terms of any agreement giving rise to
each such Account.  Neither the Collateral Agent nor any holder of the Secured
Obligations shall have any obligation or liability under any Account (or any
agreement giving rise thereto) by reason of or arising out of this Domestic
Security Agreement or the receipt by the Collateral Agent or any holder of the
Secured Obligations of any payment relating to such Account pursuant hereto, nor
shall the Collateral Agent or any holder of the Secured Obligations be obligated
in any manner to perform any of the obligations of a Grantor under or pursuant
to any Account (or any agreement giving rise thereto), to make any payment, to
make any inquiry as to the nature or the sufficiency of any payment received by
it or as to the sufficiency of any performance by any party under any Account
(or any agreement giving rise thereto), to present or file any claim, to take
any action to enforce any performance or to collect the payment of any amounts
that may have been assigned to it or to which it may be entitled at any time or
times.

 

                (b)       At any time after the occurrence and during the
continuation of an Event of Default, (i) the Collateral Agent shall have the
right, but not the obligation, to make test verifications of the Accounts in any
manner and through any medium that it reasonably considers advisable, and the
Grantors shall furnish all such assistance and information as the Collateral
Agent may reasonably require in connection with such test verifications and
(ii) the Collateral Agent in its own name or in the name of others may
communicate with account debtors on the Accounts to verify with them to the
Collateral Agent’s satisfaction the existence, amount and terms of any Accounts.

 

SECTION 4.                                                 REPRESENTATIONS AND
WARRANTIES.

 

Each Grantor hereby represents and warrants to the Collateral Agent, for the
benefit of the holders of the Secured Obligations, that so long as any of the
Secured Obligations remains outstanding and until all of the commitments
relating thereto have been terminated:

 

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                   (a)        Legal Name.  As of the date hereof:

 

                    (i)        Each Grantor’s exact legal name, taxpayer
identification number, organization identification number, and state of
formation are (and for the prior five years have been) as set forth on Schedule
5.4 to the 2008 Note Agreement.

 

                   (ii)        Other than as set forth on Schedule 4(a) attached
hereto, no Grantor has been party to a merger, consolidation or other change in
structure or used any tradename in the prior five years.

 

                   (b)        Ownership.  Each Grantor is the legal and
beneficial owner of its Collateral and has the right to pledge, sell, assign or
transfer the same.

 

                   (c)        Security Interest/Priority.  This Domestic
Security Agreement creates a valid security interest in favor of the Collateral
Agent, for the benefit of the holders of the Secured Obligations, in the
Collateral of such Grantor and, when properly perfected by filing, shall
constitute a valid perfected security interest in such Collateral, to the extent
such security interest can be perfected by filing under the UCC, free and clear
of all Liens except for Liens permitted pursuant to the terms of the Note
Documents.

 

                   (d)        Types of Collateral.  None of the Collateral
consists of, or is the Accessions or the Proceeds of, As-Extracted Collateral,
Consumer Goods, Farm Products, Manufactured Homes, or Standing Timber.

 

                   (e)        Accounts.  With respect to the Accounts of the
Grantors reflected as accounts receivable on the consolidated balance sheet of
the Company and its Subsidiaries most recently delivered to the Collateral Agent
pursuant to the 2008 Note Agreement, (i) each Account of the Grantors and the
papers and documents relating thereto are genuine and in all material respects
what they purport to be, (ii) each Account arises out of (A) a bona fide sale of
goods sold and delivered by such Grantor (or is in the process of being
delivered) or (B) services theretofore actually rendered by such Grantor to, the
account debtor named therein, (iii) any Account of a Grantor evidenced by any
Instrument or Chattel Paper has, to the extent requested by the Collateral
Agent, been endorsed over and delivered to, or submitted to the control of, the
Collateral Agent and (iv) no surety bond was required or given in connection
with any Account of a Grantor or the contracts or purchase orders out of which
they arose.

 

                    (f)        Inventory.  No Inventory of a Grantor is held by
any Person other than a Grantor pursuant to consignment, sale or return, sale on
approval or similar arrangement.

 

                   (g)        Copyrights, Patents and Trademarks.

 

                    (i)        Schedule 5.11 to the 2008 Note Agreement includes
all Copyrights, Patents, Trademarks and material Copyright Licenses, Patent
Licenses and Trademark Licenses owned by any Grantor in its own name, or to
which any Grantor is a party, as of the date hereof.

 

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                   (ii)        To each Grantor’s knowledge, each material
Copyright, Patent and Trademark of such Grantor is valid, subsisting, unexpired,
enforceable and has not been abandoned.

 

                  (iii)        Except as set forth in Schedule 5.11 to the 2008
Note Agreement, none of the material Copyrights, Patents and Trademarks of any
Grantor is the subject of any licensing or franchise agreement, as of the date
hereof.

 

                  (iv)        To each Grantor’s knowledge, no holding, decision
or judgment has been rendered by any Governmental Authority that would limit,
cancel or question the validity of any material Copyright, Patent or Trademark
of any Grantor.

 

                   (v)        No action or proceeding is pending seeking to
limit, cancel or question the validity of any material Copyright, Patent or
Trademark of any Grantor, or that could be expected to have a material adverse
effect on the value of any material Copyright, Patent or Trademark of any
Grantor.

 

                  (vi)        All applications pertaining to the material
Copyrights, Patents and Trademarks of each Grantor have been duly and properly
filed, and all registrations or letters pertaining to such Copyrights, Patents
and Trademarks have been duly and properly filed and issued, and all of such
Copyrights, Patents and Trademarks are valid and enforceable.

 

                 (vii)        No Grantor has made any assignment or agreement in
conflict with the security interest in the Copyrights, Patents or Trademarks of
any Grantor hereunder.

 

                   (h)        Commercial Tort Claims.  Such Grantor has no
commercial tort claims other than (i) those listed on Schedule 2(d), or (ii) as
to which the actions required by Section 5(k) have been taken.

 

SECTION 5.                                                 COVENANTS.

 

Each Grantor covenants that, so long as any of the Secured Obligations remains
outstanding and until all of the commitments relating thereto have been
terminated, such Grantor shall:

 

                   (a)        Other Liens.  Defend the Collateral against the
claims and demands of all other parties claiming an interest therein other than
Liens permitted pursuant to the terms of the Note Documents.

 

                   (b)        Instruments/Tangible Chattel Paper/Documents.  If
any amount payable under or in connection with any of the Collateral shall be or
become evidenced by any Instrument or Tangible Chattel Paper, or if any property
constituting Collateral shall be stored or shipped subject to a Document,
(i) ensure that such Instrument, Tangible Chattel

 

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Paper or Document is either in the possession of such Grantor at all times or,
if requested by the Collateral Agent, is immediately delivered to the Collateral
Agent, duly endorsed in a manner reasonably satisfactory to the Collateral Agent
and (ii) ensure that any Collateral consisting of an Instrument or Tangible
Chattel Paper is marked with a legend acceptable to the Collateral Agent
indicating the Collateral Agent’s security interest in such Instrument or
Tangible Chattel Paper.

 

                   (c)        Change in Structure, Location or Type.  Not,
without providing ten days prior written notice to the Collateral Agent
(i) change its name or state of formation, (ii) be party to a merger,
consolidation or other change in structure or (iii) use any tradename other than
as set forth on Schedule 4(a) attached hereto.

 

                   (d)        Perfection of Security Interest.  Execute and
deliver to the Collateral Agent such agreements, assignments or instruments
(including affidavits, notices, reaffirmations and amendments and restatements
of existing documents, as the Collateral Agent may reasonably request) and do
all such other things as the Collateral Agent may reasonably deem necessary,
appropriate or convenient (i) to assure to the Collateral Agent the
effectiveness, perfection and priority of its security interests hereunder,
including (A) such instruments as the Collateral Agent may from time to time
reasonably request in order to perfect and maintain the security interests
granted hereunder in accordance with the UCC, (B) with regard to Copyrights
registered in the United States, a Notice of Grant of Security Interest in
Copyrights for filing with the United States Copyright Office in the form of
Schedule 5(d)(i) attached hereto, (C) with regard to Patents registered in the
United States, a Notice of Grant of Security Interest in Patents for filing with
the United States Patent and Trademark Office in the form of Schedule
5(d)(ii) attached hereto and (D) with regard to Trademarks registered with the
United States Patent and Trademark Office and all applications for Trademarks
filed with the United States Patent and Trademark Office, a Notice of Grant of
Security Interest in Trademarks for filing with the United States Patent and
Trademark Office in the form of Schedule 5(d)(iii) attached hereto, (ii) to
consummate the transactions contemplated hereby and (iii) to otherwise protect
and assure the Collateral Agent of its rights and interests hereunder.  To that
end, each Grantor authorizes the Collateral Agent to file one or more financing
statements (with collateral descriptions broader, including without limitation
“all assets” and/or “all personal property” collateral descriptions, and/or less
specific than the description of the Collateral contained herein) disclosing the
Collateral Agent’s security interest in any or all of the Collateral of such
Grantor without such Grantor’s signature thereon (provided that no such
description shall be deemed to modify the description of Collateral in
Section 2), and further each Grantor also hereby irrevocably makes, constitutes
and appoints the Collateral Agent, its nominee or any other Person whom the
Collateral Agent may designate, as such Grantor’s attorney-in-fact with full
power and for the limited purpose to sign in the name of such Grantor any such
financing statements (including renewal statements), amendments and supplements,
notices or any similar documents that in the Collateral Agent’s sole discretion
would be necessary, appropriate or convenient in order to perfect and maintain
perfection of the security interests granted hereunder, such power, being
coupled with an interest, being and remaining irrevocable so long as the Secured
Obligations remain unpaid and until the commitments relating thereto shall have

 

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been terminated.  Each Grantor hereby agrees that a carbon, photographic or
other reproduction of this Domestic Security Agreement or any such financing
statement is sufficient for filing as a financing statement by the Collateral
Agent without notice thereof to such Grantor wherever the Collateral Agent may
in its sole discretion desire to file the same.  In the event for any reason the
law of any jurisdiction other than New York becomes or is applicable to the
Collateral of any Grantor or any part thereof, or to any of the Secured
Obligations, such Grantor agrees to execute and deliver all such instruments and
to do all such other things as the Collateral Agent in its sole discretion
reasonably deems necessary, appropriate or convenient to preserve, protect and
enforce the security interests of the Collateral Agent under the law of such
other jurisdiction (and, if a Grantor shall fail to do so promptly upon the
request of the Collateral Agent, then the Collateral Agent may execute any and
all such requested documents on behalf of such Grantor pursuant to the power of
attorney granted hereinabove).  If any Collateral is in the possession or
control of a Grantor’s agents and the Collateral Agent so requests, such Grantor
agrees to notify such agents in writing of the Collateral Agent’s security
interest therein and, upon the Collateral Agent’s request, instruct them to hold
all such Collateral for the account of the holders of the Secured Obligations,
subject to the Collateral Agent’s instructions.  Each Grantor agrees to mark its
books and records to reflect the security interest of the Collateral Agent in
the Collateral.

 

                   (e)        Control.  Execute and deliver all agreements,
assignments, instruments or other documents as the Collateral Agent shall
reasonably request for the purpose of obtaining and maintaining control within
the meaning of the UCC with respect to any Collateral consisting of Deposit
Accounts, Investment Property, Letter-of-Credit Rights and Electronic Chattel
Paper.

 

                    (f)        Collateral held by Warehouseman, Bailee, Etc.  If
any Collateral is at any time in the possession or control of a warehouseman,
bailee, agent or processor of such Grantor, (i) notify the Collateral Agent of
such possession or control, (ii) notify such Person of the Collateral Agent’s
security interest in such Collateral, (iii) instruct such Person to hold all
such Collateral for the Collateral Agent’s account and subject to the Collateral
Agent’s instructions and (iv) use commercially reasonable efforts to obtain an
acknowledgment from such Person that it is holding such Collateral for the
benefit of the Collateral Agent.

 

                   (g)        Treatment of Accounts.  Not grant or extend the
time for payment of any Account, or compromise or settle any Account for less
than the full amount thereof, or release any Person or property, in whole or in
part, from payment thereof, or allow any credit or discount thereon, in each
case other than as normal and customary in the ordinary course of a Grantor’s
business or as required by law.

 

                   (h)        Covenants Relating to Copyrights.

 

                    (i)        Not do any act or knowingly omit to do any act
whereby any material Copyright may become invalidated and (A) not do any act, or
knowingly omit to do any act, whereby any material Copyright may become injected
into the

 

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public domain; (B) notify the Collateral Agent immediately if it knows that any
material Copyright may become injected into the public domain or of any
materially adverse determination or development (including, without limitation,
the institution of, or any such determination or development in, any court or
tribunal in the United States or any other country) regarding a Grantor’s
ownership of any such material Copyright or its validity; (C) take all necessary
steps as it shall deem appropriate under the circumstances, to maintain and
pursue each application (and to obtain the relevant registration) of each
material Copyright owned by a Grantor and to maintain each registration of each
material Copyright owned by a Grantor including, without limitation, filing of
applications for renewal where necessary; and (D) promptly notify the Collateral
Agent of any infringement of any material Copyright of a Grantor of which it
becomes aware and take such actions as it shall reasonably deem appropriate
under the circumstances to protect such Copyright, including, where appropriate,
the bringing of suit for infringement, seeking injunctive relief and seeking to
recover any and all damages for such infringement.

 

                   (ii)        Not make any assignment or agreement in conflict
with the security interest in the Copyrights of each Grantor hereunder (other
than in connection with a Lien permitted pursuant to the terms of the 2008 Note
Agreement).

 

                    (i)        Covenants Relating to Patents and Trademarks.

 

                    (i)        (A) Continue to use each material Trademark on
each and every trademark class of goods applicable to its current line as
reflected in its current catalogs, brochures and price lists in order to
maintain such Trademark in full force free from any claim of abandonment for
non-use, (B) maintain as in the past the quality of products and services
offered under such Trademark, (C) employ such Trademark with the appropriate
notice of registration, if applicable, (D) not adopt or use any mark that is
confusingly similar or a colorable imitation of such Trademark unless the
Collateral Agent, for the ratable benefit of the holders of the Secured
Obligations, shall obtain a perfected security interest in such mark pursuant to
this Domestic Security Agreement, and (E) not (and not permit any licensee or
sublicensee thereof to) do any act or knowingly omit to do any act whereby any
such Trademark may become invalidated.

 

                   (ii)        Not do any act, or omit to do any act, whereby
any material Patent may become abandoned or dedicated.

 

                  (iii)        Notify the Collateral Agent and the holders of
the Secured Obligations immediately if it knows that any application or
registration relating to any material Patent or Trademark may become abandoned
or dedicated, or of any materially adverse determination or development
(including, without limitation, the institution of, or any such determination or
development in, any proceeding in the United States Patent and Trademark Office
or any court or tribunal in any

 

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country) regarding a Grantor’s ownership of any material Patent or Trademark or
its right to register the same or to keep and maintain the same.

 

                  (iv)        Whenever a Grantor, either by itself or through an
agent, employee, licensee or designee, shall file an application for the
registration of any Patent or Trademark with the United States Patent and
Trademark Office or any similar office or agency in any other country or any
political subdivision thereof, such Grantor shall report such filing to the
Collateral Agent within five Business Days after the last day of the fiscal
quarter in which such filing occurs.  Upon request of the Collateral Agent, a
Grantor shall execute and deliver any and all agreements, instruments, documents
and papers as the Collateral Agent may reasonably request to evidence the
security interest of the Collateral Agent and the holders of the Secured
Obligations in any material Patent or Trademark and the goodwill and general
intangibles of a Grantor relating thereto or represented thereby.

 

                   (v)        Take all reasonable and necessary steps,
including, without limitation, in any proceeding before the United States Patent
and Trademark Office, or any similar office or agency in any other country or
any political subdivision thereof, to maintain and pursue each application (and
to obtain the relevant registration) and to maintain each registration of each
material Patent and Trademark, including, without limitation, filing of
applications for renewal, affidavits of use and affidavits of incontestability.

 

                  (vi)        Promptly notify the Collateral Agent and the
holders of the Secured Obligations after it learns that any  material Patent or
Trademark included in the Collateral is infringed, misappropriated or diluted by
a third party and promptly sue for infringement, misappropriation or dilution,
to seek injunctive relief where appropriate and to recover any and all damages
for such infringement, misappropriation or dilution, or to take such other
actions as it shall reasonably deem appropriate under the circumstances to
protect such Patent or Trademark.

 

                 (vii)        Not make any assignment or agreement in conflict
with the security interest in the Patents or Trademarks of each Grantor
hereunder (other than in connection with a Lien permitted pursuant to the terms
of the 2008 Note Agreement).

 

                    (j)        Insurance.  Insure, repair and replace the
Collateral of such Grantor as set forth in (and to the extent required by) the
2008 Note Agreement.  All insurance proceeds shall be subject to the security
interest of the Collateral Agent hereunder.

 

                   (k)        Commercial Tort Claims.

 

                    (i)        Promptly notify the Collateral Agent in writing
of the initiation of any Commercial Tort Claim before any Governmental Authority
by or in favor of such Grantor or any of its Subsidiaries reasonably expected by
the Company to result in an award in excess of $1,000,000.

 

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                   (ii)        Execute and deliver such statements, documents
and notices and do and cause to be done all such things as the Collateral Agent
may reasonably deem necessary, appropriate or convenient, or as are required by
law, to create, perfect and maintain the Collateral Agent’s security interest in
any Commercial Tort Claim.

 

SECTION 6.                                                 ADVANCES BY
COLLATERAL AGENT.

 

On failure of any Grantor to perform any of the covenants and agreements
contained herein, the Collateral Agent may, at its sole option and in its sole
discretion, upon notice to the Grantors, perform the same and in so doing may
expend such sums as the Collateral Agent may reasonably deem advisable in the
performance thereof, including, without limitation, the payment of any insurance
premiums, the payment of any taxes, a payment to obtain a release of a Lien or
potential Lien (other than a Lien permitted pursuant to the terms of the 2008
Note Agreement), expenditures made in defending against any adverse claim and
all other expenditures that the Collateral Agent may make for the protection of
the security hereof or that may be compelled to make by operation of law.  All
such sums and amounts so expended shall be repayable by the Grantors on a joint
and several basis (subject to Section 23 hereof) promptly upon timely notice
thereof and demand therefor, shall constitute additional Secured Obligations and
shall bear interest from the date said amounts are expended at the Default
Rate.  No such performance of any covenant or agreement by the Collateral Agent
on behalf of any Grantor, and no such advance or expenditure therefor, shall
relieve the Grantors of any default under the terms of this Domestic Security
Agreement, the other Note Documents or any other documents relating to the
Secured Obligations.  The Collateral Agent may make any payment hereby
authorized in accordance with any bill, statement or estimate procured from the
appropriate public office or holder of the claim to be discharged without
inquiry into the accuracy of such bill, statement or estimate or into the
validity of any tax assessment, sale, forfeiture, tax lien, title or claim
except to the extent such payment is being contested in good faith by a Grantor
in appropriate proceedings and against which adequate reserves are being
maintained in accordance with GAAP.

 

SECTION 7.                                                 REMEDIES.

 

                (a)       General Remedies.  Upon the occurrence of an Event of
Default and during the continuation thereof, the Collateral Agent shall have, in
addition to the rights and remedies provided herein, in the Note Documents, in
any other documents relating to the Secured Obligations, or by law (including,
without limitation, levy of attachment and garnishment), the rights and remedies
of a secured party under the UCC of the jurisdiction applicable to the affected
Collateral and, further, the Collateral Agent may, with or without judicial
process or the aid and assistance of others, (i) enter on any premises on which
any of the Collateral may be located and, without resistance or interference by
the Grantors, take possession of the Collateral, (ii)  dispose of any Collateral
on any such premises, (iii) require the Grantors to assemble and make available
to the Collateral Agent at the expense of the Grantors any Collateral at any
place and time designated by the Collateral Agent that is reasonably convenient
to both parties, (iv) remove any Collateral from any such premises for the
purpose of effecting sale or other

 

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disposition thereof, and/or (v) without demand and without advertisement,
notice, hearing or process of law, all of which each of the Grantors hereby
waives to the fullest extent permitted by law, at any place and time or times,
sell and deliver any or all Collateral held by or for it at public or private
sale, by one or more contracts, in one or more parcels, for cash, upon credit or
otherwise, at such prices and upon such terms as the Collateral Agent deems
advisable, in its sole discretion (subject to any and all mandatory legal
requirements).  Each of the Grantors acknowledges that any private sale
referenced above may be at prices and on terms less favorable to the seller than
the prices and terms that might have been obtained at a public sale and agrees
that such private sale shall be deemed to have been made in a commercially
reasonable manner.  Neither the Collateral Agent’s compliance with applicable
law nor its disclaimer of warranties relating to the Collateral shall be
considered to adversely affect the commercial reasonableness of any sale.  In
addition to all other sums due the Collateral Agent and the holders of the
Secured Obligations with respect to the Secured Obligations, the Grantors shall
pay the Collateral Agent and each of the holders of the Secured Obligations all
reasonable documented costs and expenses incurred by the Collateral Agent or any
such holder of the Secured Obligations, including reasonable attorney’s fees and
court costs, in obtaining or liquidating the Collateral, in enforcing payment of
the Secured Obligations, or in the prosecution or defense of any action or
proceeding by or against the Collateral Agent or the holders of the Secured
Obligations or the Grantors concerning any matter arising out of or connected
with this Domestic Security Agreement, any Collateral or the Secured
Obligations, including, without limitation, any of the foregoing arising in,
arising under or related to a case under the Debtor Relief Laws.  To the extent
the rights of notice cannot be legally waived hereunder, each Grantor agrees
that any requirement of reasonable notice shall be met if such notice is
personally served on or mailed, postage prepaid, to the Company in accordance
with the notice provisions of Section 18 of the 2008 Note Agreement at least ten
Business Days before the time of sale or other event giving rise to the
requirement of such notice.  The Collateral Agent shall not be obligated to make
any sale or other disposition of the Collateral regardless of notice having been
given.  To the extent permitted by law, any holder of the Secured Obligations
may be a purchaser at any such sale.  To the extent permitted by applicable law,
each of the Grantors hereby waives all of its rights of redemption with respect
to any such sale.  Subject to the provisions of applicable law, the Collateral
Agent and the holders of the Secured Obligations may postpone or cause the
postponement of the sale of all or any portion of the Collateral by announcement
at the time and place of such sale, and such sale may, without further notice,
to the extent permitted by law, be made at the time and place to which the sale
was postponed, or the Collateral Agent may further postpone such sale by
announcement made at such time and place.

 

                (b)       Remedies relating to Accounts.  Upon the occurrence of
an Event of Default and during the continuation thereof, whether or not the
Collateral Agent has exercised any or all of its rights and remedies hereunder,
(i) each Grantor will promptly upon request of the Collateral Agent instruct all
account debtors to remit all payments in respect of Accounts to a mailing
location selected by the Collateral Agent and (ii) the Collateral Agent shall
have the right to enforce any Grantor’s rights against its customers and account
debtors, and the Collateral Agent or its designee may notify any Grantor’s
customers and account debtors that the Accounts of such Grantor have been
assigned to the Collateral Agent or of the Collateral Agent’s security interest
therein, and may (either in its own name or in the name of a Grantor or both)
demand, collect (including without limitation by way of a lockbox arrangement),
receive, take receipt for, sell,

 

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sue for, compound, settle, compromise and give acquittance for any and all
amounts due or to become due on any Account, and, in the Collateral Agent’s
discretion, file any claim or take any other action or proceeding to protect and
realize upon the security interest of the holders of the Secured Obligations in
the Accounts.  Each Grantor acknowledges and agrees that the Proceeds of its
Accounts remitted to or on behalf of the Collateral Agent in accordance with the
provisions hereof shall be solely for the Collateral Agent’s own convenience and
that such Grantor shall not have any right, title or interest in such Accounts
or in any such other amounts except as expressly provided herein.  The
Collateral Agent and the holders of the Secured Obligations shall have no
liability or responsibility to any Grantor for acceptance of a check, draft or
other order for payment of money bearing the legend “payment in full” or words
of similar import or any other restrictive legend or endorsement or be
responsible for determining the correctness of any remittance.  Each Grantor
hereby agrees to indemnify the Collateral Agent and the holders of the Secured
Obligations from and against all liabilities, damages, losses, actions, claims,
judgments, costs, expenses, charges and attorney’s fees suffered or incurred by
the Collateral Agent or the holders of the Secured Obligations (each, an
“Indemnified Party”) because of the maintenance of the foregoing arrangements
except as relating to or arising out of the gross negligence or willful
misconduct of an Indemnified Party or its partners, officers, employees or
agents.  In the case of any investigation, litigation or other proceeding, the
foregoing indemnity shall be effective whether or not such investigation,
litigation or proceeding is brought by a Grantor, its directors, shareholders or
creditors or an Indemnified Party or any other Person or any other Indemnified
Party is otherwise a party thereto.

 

                (c)       Access.  In addition to the rights and remedies
hereunder, upon the occurrence of an Event of Default and during the
continuation thereof, the Collateral Agent shall have the right to enter and
remain upon the various premises of the Grantors without cost or charge to the
Collateral Agent, and use the same, together with materials, supplies, books and
records of the Grantors for the purpose of collecting and liquidating the
Collateral, or for preparing for sale and conducting the sale of the Collateral,
whether by foreclosure, auction or otherwise.  In addition, the Collateral Agent
may remove Collateral, or any part thereof, from such premises and/or any
records with respect thereto, in order to effectively collect or liquidate such
Collateral.

 

                (d)       Nonexclusive Nature of Remedies.  Failure by the
Collateral Agent or the holders of the Secured Obligations to exercise any
right, remedy or option under this Domestic Security Agreement, any other Note
Document, any other documents relating to the Secured Obligations, or as
provided by law, or any delay by the Collateral Agent or the holders of the
Secured Obligations in exercising the same, shall not operate as a waiver of any
such right, remedy or option.  No waiver hereunder shall be effective unless it
is in writing, signed by the party against whom such waiver is sought to be
enforced and then only to the extent specifically stated, which in the case of
the Collateral Agent or the holders of the Secured Obligations shall only be
granted as provided herein.  To the extent permitted by law, neither the
Collateral Agent, the holders of the Secured Obligations, nor any party acting
as attorney for the Collateral Agent or the holders of the Secured Obligations,
shall be liable hereunder for any acts or omissions or for any error of judgment
or mistake of fact or law other than their gross negligence or willful
misconduct hereunder.  The rights and remedies of the Collateral Agent and the
holders of the Secured Obligations under this Domestic Security Agreement shall
be cumulative and not exclusive of

 

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any other right or remedy that the Collateral Agent or the holders of the
Secured Obligations may have.

 

                (e)       Retention of Collateral.  To the extent permitted
under applicable law, in addition to the rights and remedies hereunder, upon the
occurrence and during the continuation of an Event of Default, the Collateral
Agent may, after providing the notices required by Sections 9-620 and 9-621 of
the UCC or otherwise complying with the requirements of applicable law of the
relevant jurisdiction, accept or retain all or any portion of the Collateral in
satisfaction of the Secured Obligations.  Unless and until the Collateral Agent
shall have provided such notices, however, the Collateral Agent shall not be
deemed to have accepted or retained any Collateral in satisfaction of any
Secured Obligations for any reason.

 

                 (f)       Deficiency.  In the event that the proceeds of any
sale, collection or realization are insufficient to pay all amounts to which the
Collateral Agent or the holders of the Secured Obligations are legally entitled,
the Grantors shall be jointly and severally liable for the deficiency (subject
to Section 23 hereof), together with interest thereon at the Default Rate,
together with the costs of collection and attorney’s fees.  Any surplus
remaining after the full payment and satisfaction of the Secured Obligations
shall be returned to the Grantors or to whomsoever a court of competent
jurisdiction shall determine to be entitled thereto.

 

SECTION 8.                                                 RIGHTS OF THE
COLLATERAL AGENT.

 

                (a)       Power of Attorney.  In addition to other powers of
attorney contained herein, each Grantor hereby designates and appoints the
Collateral Agent, on behalf of the holders of the Secured Obligations, and each
of its designees or agents, as attorney-in-fact of such Grantor, irrevocably and
with power of substitution, with authority to take any or all of the following
actions upon the occurrence and during the continuation of an Event of Default:

 

                    (i)        to demand, collect, settle, compromise and
adjust, and give discharges and releases concerning the Collateral, all as the
Collateral Agent may reasonably deem appropriate;

 

                   (ii)        to commence and prosecute any actions at any
court for the purposes of collecting any of the Collateral and enforcing any
other right in respect thereof;

 

                  (iii)        to defend, settle or compromise any action
brought and, in connection therewith, give such discharge or release as the
Collateral Agent may reasonably deem appropriate;

 

                  (iv)        to receive, open and dispose of mail addressed to
a Grantor and endorse checks, notes, drafts, acceptances, money orders, bills of
lading, warehouse receipts or other instruments or documents evidencing payment,
shipment or storage of the goods giving rise to the Collateral on behalf of and
in the name of such Grantor, or securing, or relating to such Collateral;

 

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                   (v)        to pay or discharge taxes, liens, security
interests or other encumbrances levied or placed on or threatened against the
Collateral;

 

                  (vi)        to direct any parties liable for any payment in
connection with any of the Collateral to make payment of any and all monies due
and to become due thereunder directly to the Collateral Agent or as the
Collateral Agent shall direct;

 

                 (vii)        to receive payment of and receipt for any and all
monies, claims, and other amounts due and to become due at any time in respect
of or arising out of any Collateral;

 

                (viii)        to sell, assign, transfer, make any agreement in
respect of, or otherwise deal with or exercise rights in respect of, any
Collateral or the goods or services that have given rise thereto, as fully and
completely as though the Collateral Agent were the absolute owner thereof for
all purposes;

 

                   (ix)        to adjust and settle claims under any insurance
policy relating thereto;

 

                    (x)        to execute and deliver all assignments,
conveyances, statements, financing statements, renewal financing statements,
security and pledge agreements, affidavits, notices and other agreements,
instruments and documents that the Collateral Agent may reasonably deem
appropriate in order to perfect and maintain the security interests and liens
granted in this Domestic Security Agreement and in order to fully consummate all
of the transactions contemplated therein;

 

                   (xi)        to institute any foreclosure proceedings that the
Collateral Agent may reasonably deem appropriate; and

 

                  (xii)        to do and perform all such other acts and things
as the Collateral Agent may reasonably deem appropriate in connection with the
Collateral.

 

This power of attorney is a power coupled with an interest and shall be
irrevocable for so long as any of the Secured Obligations shall remain
outstanding and until all of the commitments relating thereto shall have been
terminated.  The Collateral Agent shall be under no duty to exercise or withhold
the exercise of any of the rights, powers, privileges and options expressly or
implicitly granted to the Collateral Agent in this Domestic Security Agreement,
and shall not be liable for any failure to do so or any delay in doing so.  The
Collateral Agent shall not be liable for any act or omission or for any error of
judgment or any mistake of fact or law in its individual capacity or its
capacity as attorney-in-fact except acts or omissions resulting from its gross
negligence or willful misconduct.  This power of attorney is conferred on the
Collateral Agent solely to protect, preserve and realize upon its security
interest in the Collateral.

 

                (b)       The Collateral Agent’s Duty of Care.  Other than the
exercise of reasonable care to assure the safe custody of the Collateral while
being held by the Collateral Agent hereunder, the Collateral Agent shall have no
duty or liability to preserve rights pertaining thereto, it being understood and
agreed that the Grantors shall be responsible for preservation of all rights in
the Collateral, and the Collateral Agent shall be relieved of all responsibility
for the Collateral upon

 

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surrendering it or tendering the surrender of it to the Grantors.  The
Collateral Agent shall be deemed to have exercised reasonable care in the
custody and preservation of the Collateral in its possession if such Collateral
is accorded treatment substantially equal to that which the Collateral Agent
accords its own property, which shall be no less than the treatment employed by
a reasonable and prudent agent in the industry, it being understood that the
Collateral Agent shall not have responsibility for taking any necessary steps to
preserve rights against any parties with respect to any of the Collateral.  In
the event of a public or private sale of Collateral pursuant to Section 7
hereof, the Collateral Agent shall have no obligation to clean, repair or
otherwise prepare the Collateral for sale.

 

SECTION 9.                                                 RIGHTS OF REQUIRED
HOLDERS.

 

All rights of the Collateral Agent hereunder, if not exercised by the Collateral
Agent, may be exercised by the Required Holders.  If such rights are so
exercised by the Required Holders, then the Required Holders shall have all of
the rights, privileges and indemnities afforded the Collateral Agent in the
exercise of such rights.

 

SECTION 10.                                           APPLICATION OF PROCEEDS.

 

Upon the occurrence and during the continuation of an Event of Default, any
payments in respect of the Secured Obligations and any proceeds of the
Collateral, when received by the Collateral Agent or any of the holders of the
Secured Obligations in cash or its equivalent, will be applied in reduction of
the Secured Obligations in the order set forth in the Intercreditor Agreement,
and each Grantor irrevocably waives the right to direct the application of such
payments and proceeds and acknowledges and agrees that the Collateral Agent
shall have the continuing and exclusive right to apply and reapply any and all
such payments and proceeds in the Collateral Agent’s sole discretion,
notwithstanding any entry to the contrary upon any of its books and records.

 

SECTION 11.                                           CONTINUING AGREEMENT.

 

                (a)       This Domestic Security Agreement shall be a continuing
agreement in every respect and shall remain in full force and effect so long as
any of the Secured Obligations remains outstanding and until all of the
commitments relating thereto have been terminated (other than any obligations
with respect to the indemnities set forth in the Note Documents).  Upon such
payment and termination, this Domestic Security Agreement and the liens and
security interests of the Collateral Agent hereunder shall be automatically
terminated and the Collateral Agent shall, upon the request and at the expense
of the Grantors, execute and deliver all UCC termination statements and/or other
documents reasonably requested by the Grantors evidencing such termination. 
Notwithstanding the foregoing, all releases and indemnities provided hereunder
shall survive termination of this Domestic Security Agreement.

 

                (b)       This Domestic Security Agreement shall continue to be
effective or be automatically reinstated, as the case may be, if at any time
payment, in whole or in part, of any of the Secured Obligations is rescinded or
must otherwise be restored or returned by the Collateral Agent or any

 

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holder of the Secured Obligations as a preference, fraudulent conveyance or
otherwise under any bankruptcy, insolvency or similar law, all as though such
payment had not been made; provided that in the event payment of all or any part
of the Secured Obligations is rescinded or must be restored or returned, all
reasonable costs and expenses (including reasonable attorney’s fees) incurred by
the Collateral Agent or any holder of the Secured Obligations in defending and
enforcing such reinstatement shall be deemed to be included as a part of the
Secured Obligations.

 

SECTION 12.                                           AMENDMENTS AND WAIVERS.

 

This Domestic Security Agreement and the provisions hereof may not be amended,
waived, modified, changed, discharged or terminated except as set forth in Note
Documents.

 

SECTION 13.                                           SUCCESSORS IN INTEREST.

 

 This Domestic Security Agreement shall create a continuing security interest in
the Collateral and shall be binding upon each Grantor, its successors and
assigns, and shall inure, together with the rights and remedies of the
Collateral Agent and the holders of the Secured Obligations hereunder, to the
benefit of the Collateral Agent and the holders of the Secured Obligations and
their successors and permitted assigns; provided, however, none of the Grantors
may assign its rights or delegate its duties hereunder without the prior written
consent of the Required Holders under the 2008 Note Agreement.  To the fullest
extent permitted by law, each Grantor hereby releases the Collateral Agent and
each holder of the Secured Obligations, their respective successors and assigns
and their respective officers, attorneys, employees and agents, from any
liability for any act or omission or any error of judgment or mistake of fact or
of law relating to this Domestic Security Agreement or the Collateral, except
for any liability arising from the gross negligence or willful misconduct of the
Collateral Agent or such holder, or their respective officers, attorneys,
employees or agents.

 

SECTION 14.                                           NOTICES.

 

All notices required or permitted to be given under this Domestic Security
Agreement shall be given as provided in Section 18 of the 2008 Note Agreement.

 

SECTION 15.                                           COUNTERPARTS.

 

This Domestic Security Agreement may be executed in any number of counterparts,
each of which where so executed and delivered shall be an original, but all of
which shall constitute one and the same instrument.  It shall not be necessary
in making proof of this Domestic Security Agreement to produce or account for
more than one such counterpart.

 

SECTION 16.                                           HEADINGS.

 

 The headings of the sections and subsections hereof are provided for
convenience only and shall not in any way affect the meaning or construction of
any provision of this Domestic Security Agreement.

 

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SECTION 17.                                           GOVERNING LAW; SUBMISSION
TO JURISDICTION; VENUE.

 

                (a)       THIS DOMESTIC SECURITY AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO
AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT
THE COLLATERAL AGENT AND EACH PURCHASER SHALL RETAIN ALL RIGHTS ARISING UNDER
FEDERAL LAW.

 

                (b)       AnY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
DOMESTIC SECURITY AGREEMENT OR ANY OTHER NOTE DOCUMENT MAY BE BROUGHT IN THE
COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK, NEW YORK OR OF THE UNITED
STATES FOR THE SOUTHERN DISTRICT OF SUCH STATE, AND BY EXECUTION AND DELIVERY OF
THIS DOMESTIC SECURITY AGREEMENT, EACH GRANTOR AND THE COLLATERAL AGENT, ON
BEHALF OF ITSELF AND EACH PURCHASER, CONSENTS, FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH GRANTOR AND
THE COLLATERAL AGENT, ON BEHALF OF ITSELF AND EACH PURCHASER, IRREVOCABLY WAIVES
ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF THIS
DOMESTIC SECURITY AGREEMENT OR ANY OTHER NOTE DOCUMENT OR OTHER DOCUMENT RELATED
THERETO. EACH GRANTOR AND THE COLLATERAL AGENT, ON BEHALF OF ITSELF AND EACH
PURCHASER, WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS,
WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.

 

SECTION 18.                                           WAIVER OF RIGHT TO TRIAL
BY JURY.

 

EACH PARTY TO THIS DOMESTIC SECURITY AGREEMENT HEREBY EXPRESSLY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT TO TRIAL BY JURY OF ANY
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING UNDER THIS DOMESTIC SECURITY
AGREEMENT OR ANY OTHER NOTE DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR
INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO
THIS DOMESTIC SECURITY AGREEMENT OR ANY OTHER NOTE DOCUMENT, OR THE TRANSACTIONS
RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES
AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE
DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS DOMESTIC
SECURITY AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS
SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES
HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.  EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
DOMESTIC PLEDGE AGREEMENT AND THE OTHER NOTE DOCUMENTS BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

19

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SECTION 19.                                           SEVERABILITY.

 

 If any provision of this Domestic Security Agreement is determined to be
illegal, invalid or unenforceable, such provision shall be fully severable and
the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.

 

SECTION 20.                                           ENTIRETY.

 

This Domestic Security Agreement, the other Note Documents and the other
documents relating to the Secured Obligations represent the entire agreement of
the parties hereto and thereto, and supersede all prior agreements and
understandings, oral or written, if any, including any commitment letters or
correspondence relating to the Note Documents, any other documents relating to
the Secured Obligations, or the transactions contemplated herein and therein.

 

SECTION 21.                                           SURVIVAL.

 

All representations and warranties of the Grantors hereunder shall survive the
execution and delivery of this Domestic Security Agreement, the other Note
Documents and the other documents relating to the Secured Obligations, the
delivery of the Notes and the extension of credit thereunder or in connection
therewith.

 

SECTION 22.                                           OTHER SECURITY.

 

To the extent that any of the Secured Obligations are now or hereafter secured
by property other than the Collateral (including, without limitation, real
property and securities owned by a Grantor), or by a guarantee, endorsement or
property of any other Person, then the Collateral Agent shall have the right to
proceed against such other property, guarantee or endorsement upon the
occurrence of any Event of Default, and the Collateral Agent shall have the
right, in its sole discretion, to determine which rights, security, liens,
security interests or remedies the Collateral Agent shall at any time pursue,
relinquish, subordinate, modify or take with respect thereto, without in any way
modifying or affecting any of them or the Secured Obligations or any of the
rights of the Collateral Agent or the holders of the Secured Obligations under
this Domestic Security Agreement, under any of the other Note Documents or under
any other document relating to the Secured Obligations.

 

SECTION 23.                                           JOINT AND SEVERAL
OBLIGATIONS OF GRANTORS.

 

                (a)       Subject to subsection (c) of this Section 23, each of
the Grantors is accepting joint and several liability hereunder in consideration
of the financial accommodation to be provided by the holders of the Secured
Obligations, for the mutual benefit, directly and indirectly, of each of the
Grantors and in consideration of the undertakings of each of the Grantors to
accept joint and several liability for the obligations of each of them.

 

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                (b)       Subject to subsection (c) of this Section 23, each of
the Grantors jointly and severally hereby irrevocably and unconditionally
accepts, not merely as a surety but also as a co-debtor, joint and several
liability with the other Grantors with respect to the payment and performance of
all of the Secured Obligations arising under this Domestic Security Agreement,
the other Note Documents and any other documents relating to the Secured
Obligations, it being the intention of the parties hereto that all the Secured
Obligations shall be the joint and several obligations of each of the Grantors
without preferences or distinction among them.

 

                (c)       Notwithstanding any provision to the contrary
contained herein, in any other of the Note Documents or in any other documents
relating to the Secured Obligations, the obligations of each Grantor under the
2008 Note Agreement, the other Note Documents and the other documents relating
to the Secured Obligations shall be limited to an aggregate amount equal to the
largest amount that would not render such obligations subject to avoidance under
Section 548 of the United States Bankruptcy Code or any comparable provisions of
any applicable state law.

 

[Signature Pages Follow]

 

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Each of the parties hereto has caused a counterpart of this Domestic Security
Agreement to be duly executed and delivered as of the date first above written.

 

GRANTORS:

GFI GROUP INC., a Delaware corporation

 

 

 

By:

 

 

  Name:

 

  Title:

 

 

 

GFI GROUP LLC, a New York limited liability
company

 

 

 

By:

 

 

  Name:

 

  Title:

 

 

 

GFINET Inc., a Delaware corporation

 

 

 

By:

 

 

  Name:

 

  Title:

 

 

 

GFI BROKERS LLC, a Delaware limited liability company

 

 

 

By:

 

 

  Name:

 

  Title:

 

 

 

INTERACTIVE VENTURES LLC, a Delaware limited liability company

 

 

 

By:

 

 

  Name:

 

  Title:

 

 

 

FENICS SOFTWARE INC., a Delaware corporation

 

 

 

By:

 

 

  Name:

 

  Title:

 

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

 

 

AMEREX BROKERS, LLC., a                  limited
liability company

 

 

 

By:

 

 

  Name:

 

  Title:

 

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

 

Accepted and agreed to as of the date first above written.

 

BANK OF AMERICA, N.A., as Collateral Agent

 

By:

 

 

 Name:

 Title:

 

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

 

COMMERCIAL TORT CLAIMS

 

NONE

 

SCHEDULE 2(D)

 

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

 

NOTICE

OF

GRANT OF SECURITY INTEREST

IN

COPYRIGHTS

 

United States Copyright Office

 

Ladies and Gentlemen:

 

Please be advised that pursuant to the Domestic Security Agreement dated as of
January 30, 2008 (as the same may be amended, modified, extended or restated
from time to time, the “Domestic Security Agreement”) by and among the Grantors
from time to time party thereto (each an “Grantor” and collectively, the
“Grantors”) and Bank of America, N.A., as Collateral Agent (the “Collateral
Agent”) for the holders of the Secured Obligations referenced therein, the
undersigned Grantor has granted a continuing security interest in and continuing
lien upon, the copyrights and copyright applications shown on Schedule 1
attached hereto to the Collateral Agent for the ratable benefit of the holders
of the Secured Obligations.

 

The undersigned Grantor and the Collateral Agent, on behalf of the holders of
the Secured Obligations, hereby acknowledge and agree that the security interest
in the copyrights and copyright applications set forth on Schedule 1 attached
hereto (i) may only be terminated in accordance with the terms of the Domestic
Security Agreement and (ii) is not to be construed as an assignment of any
copyright or copyright application.

 

 

Very truly yours,

 

 

 

 

 

 

[Grantor]

 

 

 

 

 

By:

 

 

Name:

 

Title:

 

 

 

 

Acknowledged and Accepted .

 

 

 

BANK OF AMERICA, N.A., as Collateral Agent

 

 

 

By:

 

 

 

  Name:

 

  Title:

 

 

SCHEDULE 5(d)(i)

 

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

 

NOTICE

OF

GRANT OF SECURITY INTEREST

IN

PATENTS

 

United States Patent and Trademark Office

 

Ladies and Gentlemen:

 

Please be advised that pursuant to the Domestic Security Agreement dated as of
January 30, 2008 (the “Domestic Security Agreement”) by and among the Grantors
from time to time party thereto (each an “Grantor” and collectively, the
“Grantors”) and Bank of America, N.A., as Collateral Agent (the “Collateral
Agent”) for the holders of the Secured Obligations referenced therein, the
undersigned Grantor has granted a continuing security interest in and continuing
lien upon, the patents and patent applications set forth on Schedule 1 attached
hereto to the Collateral Agent for the ratable benefit of the holders of the
Secured Obligations.

 

The undersigned Grantor and the Collateral Agent, on behalf of the holders of
the Secured Obligations, hereby acknowledge and agree that the security interest
in the patents and patent applications set forth on Schedule 1 attached hereto
(i) may only be terminated in accordance with the terms of the Domestic Security
Agreement and (ii) is not to be construed as an assignment of any patent or
patent application.

 

 

Very truly yours,

 

 

 

 

 

 

[Grantor]

 

 

 

 

 

By:

 

 

Name:

 

Title:

 

 

 

 

Acknowledged and Accepted .

 

 

 

BANK OF AMERICA, N.A., as Collateral Agent

 

 

 

By:

 

 

 

 Name:

 

 Title:

 

 

SCHEDULE 5(d)(ii)

 

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

 

NOTICE

OF

GRANT OF SECURITY INTEREST

IN

TRADEMARKS

 

United States Patent and Trademark Office

 

Ladies and Gentlemen:

 

Please be advised that pursuant to the Domestic Security Agreement dated as of
January 30, 2008 (the “Domestic Security Agreement”) by and among the Grantors
from time to time party thereto (each an “Grantor” and collectively, the
“Grantors”) and Bank of America, N.A., as Collateral Agent (the “Collateral
Agent”) for the holders of the Secured Obligations referenced therein, the
undersigned Grantor has granted a continuing security interest in and continuing
lien upon, the trademarks and trademark applications set forth on Schedule 1
attached hereto to the Collateral Agent for the ratable benefit of the holders
of the Secured Obligations.

 

The undersigned Grantor and the Collateral Agent, on behalf of the holders of
the Secured Obligations, hereby acknowledge and agree that the security interest
in the trademarks and trademark applications set forth on Schedule 1 attached
hereto (i) may only be terminated in accordance with the terms of the Domestic
Security Agreement and (ii) is not to be construed as an assignment of any
trademark or trademark application.

 

 

Very truly yours,

 

 

 

 

 

 

[Grantor]

 

 

 

 

 

By:

 

 

Name:

 

Title:

 

 

Acknowledged and Accepted .

 

 

 

BANK OF AMERICA, N.A., as Collateral Agent

 

 

 

By:

 

 

 

  Name:

 

  Title:

 

 

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