Exhibit 10.16

 

 

 

GUARANTY AND COLLATERAL AGREEMENT

dated as of

March 31, 2008

among

HUGHES TELEMATICS, INC.,

THE SUBSIDIARIES OF HUGHES TELEMATICS, INC. IDENTIFIED HEREIN

and

MORGAN STANLEY & CO. INCORPORATED,

as COLLATERAL AGENT

 

 

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TABLE OF CONTENTS

 

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ARTICLE I Definitions

   1

Section 1.01. Credit Agreement; UCC

   1

Section 1.02. Other Defined Terms

   1

ARTICLE II Guaranty

   8

Section 2.01. Guaranty

   8

Section 2.02. Amendments, etc. with respect to the Obligations

   8

Section 2.03. Guaranty Absolute and Unconditional

   9

Section 2.04. Reinstatement

   11

Section 2.05. Payments

   11

Section 2.06. Information

   11

ARTICLE III Pledge of Securities

   12

Section 3.01. Pledge

   12

Section 3.02. Delivery of the Pledged Collateral

   12

Section 3.03. Representations, Warranties and Covenants

   13

Section 3.04. Registration in Nominee Name; Denominations

   14

Section 3.05. Voting Rights; Dividends and Interest

   14

ARTICLE IV Security Interests in Personal Property

   16

Section 4.01. Security Interest

   16

Section 4.02. Representations and Warranties

   18

Section 4.03. Covenants

   20

Section 4.04. Other Actions

   23

Section 4.05. Covenants Regarding Patent, Trademark and Copyright Collateral

   24

Section 4.06. Cash Management System and Securities Accounts

   26

Section 4.07. Certain Uncertificated Securities

   28

ARTICLE V Remedies

   28

Section 5.01. Remedies upon Default

   28

Section 5.02. Application of Proceeds

   29

Section 5.03. Grant of License To Use Intellectual Property

   31

Section 5.04. Securities Act

   32

ARTICLE VI Indemnity, Subrogation and Subordination

   32

Section 6.01. Indemnity and Subrogation

   32

Section 6.02. Contribution and Subrogation

   33

Section 6.03. Subordination

   33

ARTICLE VII Miscellaneous

   34

Section 7.01. Notices

   34

Section 7.02. Waivers; Amendment

   34

Section 7.03. Collateral Agent’s Fees and Expenses; Indemnification

   34

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Section 7.04. Successors and Assigns

   35

Section 7.05. Survival of Agreement

   35

Section 7.06. Counterparts; Effectiveness; Several Agreement

   35

Section 7.07. Severability

   36

Section 7.08. Right of Set-Off

   36

Section 7.09. Governing Law; Jurisdiction; Consent to Service of Process

   36

Section 7.10. WAIVER OF JURY TRIAL

   37

Section 7.11. Headings

   37

Section 7.12. Liabilities of Guarantors and Security Interest Absolute

   37

Section 7.13. Termination or Release

   38

Section 7.14. Additional Subsidiaries

   39

Section 7.15. Collateral Agent Appointed Attorney-in-Fact

   39

Section 7.16. Further Assurances

   40

Section 7.17. Collateral Agent

   40

Schedules

 

Schedule I   Guarantors Schedule II   Pledged Stock; Pledged Debt Schedule III  
Intellectual Property Schedule IV   Commercial Tort Claims Schedule V   Deposit
Accounts Schedule VI   Securities Accounts Schedule VII   Schedule of Legal
Names, Etc. Schedule VIII   Persons Holding Collateral; Locations of Collateral
Schedule IX   Filing Offices

 

Exhibits

 

  Exhibit I   Form of Supplement Exhibit II   Form of Deposit Account Control
Agreement Exhibit III   Form of Securities Account Control Agreement Exhibit IV
  Form of Grant of Security Interest in United States Trademarks Exhibit V  
Form of Grant of Security Interest in United States Patents Exhibit VI   Form of
Grant of Security Interest in United States Copyrights Exhibit VII   Form of
Uncertificated Securities Control Agreement

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GUARANTY AND COLLATERAL AGREEMENT (this “Agreement”) dated as of March 31, 2008,
among HUGHES TELEMATICS, INC., a Delaware corporation (the “Borrower”), the
Subsidiaries of the Borrower from time to time party hereto (whether as original
signatories or as additional parties as contemplated by Section 7.14 hereof)
identified herein and MORGAN STANLEY & CO. INCORPORATED, as collateral agent for
the Lenders and the other Secured Creditors (as defined below) as party to the
Credit Agreement described below (in such capacity, the “Collateral Agent”.

Reference is made to the Credit Agreement dated as of March 31, 2008 (as
amended, amended and restated, waived, supplemented or otherwise modified from
time to time, the “Credit Agreement”), among the Borrower, the Lenders party
thereto from time to time, the Collateral Agent and Morgan Stanley Senior
Funding, Inc., as Administrative Agent. The Lenders have agreed to extend credit
to the Borrower subject to the terms and conditions set forth in the Credit
Agreement. The obligations of the Lenders to extend such credit are conditioned
upon, among other things, the execution and delivery of this Agreement. The
Guarantors (defined below) are affiliates of the Borrower, will derive
substantial benefits from the extension of credit to the Borrower pursuant to
the Credit Agreement and are willing to execute and deliver this Agreement in
order to induce the Lenders to extend such credit. Accordingly, the parties
hereto agree as follows:

ARTICLE I

Definitions

Section 1.01. Credit Agreement; UCC. Except as provided in the immediately
succeeding sentence, capitalized terms used in this Agreement and not otherwise
defined in this Agreement have the meanings specified in the Credit Agreement.
All terms defined in the New York UCC (as defined in this Agreement) and not
defined in this Agreement have the meanings specified therein.

Section 1.02. Other Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:

“Account Debtor” means any Person who is or who may become obligated to any
Grantor under, with respect to or on account of an Account.

“Adjusted Net Worth” of any Guarantor at any time, shall mean the greater of
(x) $0 and (y) the amount by which the fair saleable value of such Guarantor’s
assets on the date of the respective payment hereunder exceeds its debts and
other liabilities (including contingent liabilities, but without giving effect
to any of its obligations under this Agreement or any other Credit Document).

“Agreement” means this Guaranty and Collateral Agreement, as the same may be
amended, modified, restated and/or supplemented from time to time in accordance
with its terms.

“Article 9 Collateral” has the meaning assigned to such term in Section 4.01.

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“Capital Lease” means, as applied to any Grantor, any lease of any property by
that Grantor as lessee which is accounted for as a capital lease on the balance
sheet of that Grantor.

“Capitalized Lease Obligations” of any Grantor means all obligations under
Capital Leases of such Grantor.

“Collateral” means Article 9 Collateral and Pledged Collateral.

“Contract Rights” shall mean all rights of any Grantor under each Contract,
including, without limitation, (i) any and all rights to receive and demand
payments under any or all Contracts, (ii) any and all rights to receive and
compel performance under any or all Contracts and (iii) any and all other
rights, interests and claims now existing or in the future arising in connection
with any or all Contracts.

“Contracts” with respect to any Grantor, shall mean all contracts, agreements,
instruments and indentures, including Licenses, in any form and portions
thereof, to which such Grantor is a party or under which such Grantor or any
property of such Grantor is subject, as the same may from time to time be
amended, supplemented, waived or otherwise modified, including, without
limitation, (i) all rights of such Grantor to receive moneys due and to become
due to it thereunder or in connection therewith, (ii) all rights of such Grantor
to damages arising thereunder and (iii) all rights of such Grantor to perform
and to exercise all remedies thereunder.

“Contributing Party” has the meaning assigned to such term in Section 6.02.

“Control” shall mean (i) in the case of each Deposit Account, “control”, as such
term is defined in Section 9-104 of the New York UCC, (ii) in the case of any
Securities Account, “control” as such term is defined in Section 8-106 of the
New York UCC, and (iii) in the case of any Commodity Account, “control”, as such
term is defined in section 9-106 of the New York UCC.

“Control Agreements” means, collectively, the Deposit Account Control Agreements
and the Securities Account Control Agreements.

“Copyright License” means any written agreement, now or hereafter in effect,
granting any right to any third party under any Copyright now or hereafter owned
by any Grantor or that such Grantor otherwise has the right to license, or
granting any right to any Grantor under any Copyright now or hereafter owned by
any third party, and all rights of any Grantor under any such agreement.

“Copyrights” means copyrights, including any United States or foreign copyright
now or hereafter owned by any Grantor, including any registrations of any
copyrights in the United States Copyright Office or any foreign equivalent
office, as well as any application for a copyright registration now or hereafter
made with the United States Copyright Office or any foreign equivalent office by
any Grantor and including the copyrights and copyright applications listed on
Schedule III annexed hereto.

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“Credit Agreement” has the meaning assigned to such term in the preliminary
statement in this Agreement.

“Credit Document Obligations” means (a) the due and punctual payment by the
Borrower of (i) the principal of, premium, if any, and interest on the Notes, if
any, issued by, and the Loans made to, the Borrower under the Credit Agreement
and (y) all other obligations (including, without limitation, obligations which,
but for the automatic stay under Section 362(a) of the Bankruptcy Code, would
become due), liabilities and indebtedness owing by the Borrower to the Lenders
under each Credit Document to which the Borrower is a party (including, without
limitation, indemnities, fees and interest thereon (including, without
limitation, any interest accruing after the commencement of any bankruptcy,
insolvency, receivership or similar proceeding at the rate provided for in the
Credit Agreement, whether or not such interest is an allowed claim in any such
proceeding)), whether now existing or hereafter incurred under, arising out of
or in connection with each such Credit Document and the due performance and
compliance by the Borrower with all of the terms, conditions, covenants and
agreements contained in all such Credit Documents.

“Deposit Account Control Agreement” means an agreement substantially in the form
annexed hereto as Exhibit II or such other form as is reasonably satisfactory to
the Collateral Agent and the Borrower establishing Collateral Agent’s Control
with respect to any Deposit Account.

“Deposit Accounts” means all “deposit accounts” as such term is defined in the
New York UCC.

“Federal Securities Laws” has the meaning assigned to such term in Section 5.04.

“Foreign Subsidiary” means any corporation, partnership, limited liability
company or other business entity (i) which is organized under the laws of a
jurisdiction other than a state of the United States or the District of Columbia
and (ii) of which securities or other ownership interests representing more than
50% of the equity, more than 50% of the ordinary voting power, more than 50% of
the general partnership interests or more than 50% of the limited liability
company membership interests are, at the time any determination is being made,
owned directly by the applicable Grantor.

“Grantors” means the Borrower and each Guarantor.

“Guaranteed Party” shall mean the Borrower and each Subsidiary of the Borrower
party to any Interest Rate Protection Agreement or Other Hedging Agreement with
one or more Lenders or any affiliate thereof.

“Guarantors” means (a) the Subsidiaries of Borrower identified on Schedule I and
(b) each other direct or indirect Subsidiary of Borrower that becomes a party to
this Agreement as a Guarantor after the Closing Date.

“Indemnitee” shall have the meaning assigned to such term in Section 7.03(b).

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“Intellectual Property” shall mean and include the following: (a) Copyrights;
(b) domain names, including all internet domain names and associated URL
addresses in or to which any Grantor now or hereafter has any right, title or
interest; (c) Trademarks; (d) Patents; and (e) trade secrets, including any
secretly held proprietary existing engineering or other data, information,
production procedures and other secretly held proprietary know-how relating to
the design manufacture, assembly, installation, use, operation, marketing, sale
and/or servicing of any products or business of any Grantor worldwide whether
written or not.

“Investment Property” means a security, whether certificated or uncertificated,
Security Entitlement, Securities Account, Commodity Contract or Commodity
Account.

“License” means any Patent License, Trademark License, Copyright License or
other license or sublicense agreement pertaining to Intellectual Property to
which any Grantor is a party.

“Limited Liability Company Interests” means all right, title and interest in
each limited liability company, including, without limitation:

(A) all its capital therein and its interest in all profits, income, surpluses,
losses, LLC Assets and other distributions to which such Grantor shall at any
time be entitled in respect of such LLC Interests;

(B) all other payments due or to become due to such Grantor in respect of LLC
Interests, whether under any limited liability company agreement or otherwise,
whether as contractual obligations, damages, insurance proceeds or otherwise;

(C) all of its claims, rights, powers, privileges, authority, options, security
interests, liens and remedies, if any, under any limited liability company
agreement or operating agreement, or at law or otherwise in respect of such LLC
Interests;

(D) all present and future claims, if any, of such Grantor against any such
limited liability company for monies loaned or advanced, for services rendered
or otherwise;

(E) all of such Grantor’s rights under any limited liability company agreement
or operating agreement or at law to exercise and enforce every right, power,
remedy, authority, option and privilege of such Grantor relating to such LLC
Interests, including any power to terminate, cancel or modify any such limited
liability company agreement or operating agreement, to execute any instruments
and to take any and all other action on behalf of and in the name of any of such
Grantor in respect of such LLC Interests and any such limited liability company,
to make determinations, to exercise any election (including, but not limited to,
election of remedies) or option or to give or receive any notice, consent,
amendment, waiver or approval, together with full power and authority to demand,
receive, enforce, collect or receipt for any of the foregoing or for any LLC
Asset, to enforce or execute any checks, or other instruments or orders, to file
any claims and to take any action in connection with any of the foregoing; and

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(F) all other property hereafter delivered in substitution for or in addition to
any of the foregoing, all certificates and instruments representing or
evidencing such other property and all cash, securities, interest, dividends,
rights and other property at any time and from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all thereof;

“LLC Assets” shall mean all assets of a limited liability company, whether
tangible or intangible and whether real, personal or mixed (including, without
limitation, all limited liability company capital and interest in other limited
liability companies), at any time owned by any Grantor or represented by any LLC
Interest.

“LLC Interests” shall mean the entire limited liability company membership
interest at any time owned by any Grantor in any limited liability company.

“New York UCC” means the Uniform Commercial Code as from time to time in effect
in the State of New York.

“Obligations” means (a) Credit Document Obligations and (b) the Other
Obligations.

“Other Obligations” means all obligations (including, without limitation,
obligations which, but for the automatic stay under Section 362(a) of the
Bankruptcy Code, would become due), liabilities and indebtedness (including,
without limitation, any interest accruing after the commencement of any
bankruptcy, insolvency, receivership or similar proceeding at the rate provided
for in the respective Interest Rate Protection Agreements or Other Hedging
Agreements, whether or not such interest is an allowed claim in any such
proceeding) owing by the Borrower to a Lender under such Interest Rate
Protection Agreements or Other Hedging Agreements, whether now in existence or
hereafter arising, and the due performance and compliance by the Borrower with
all of the terms, conditions, covenants and agreements contained therein.

“Other Creditor” means any Lender or any affiliate thereof, together with such
Lender’s or affiliate’s successors and assigns (even if the respective Lender
subsequently ceases to be a Lender under the Credit Agreement for any reason),
who has from time to time entered into one or more Interest Rate Protection
Agreements and/or Other Hedging Agreements with a Credit Party.

“Partnership Assets” shall mean all assets of a partnership, whether tangible or
intangible and whether real, personal or mixed (including, without limitation,
all partnership capital and interest in other partnerships), at any time owned
by any Grantor or represented by any Partnership Interest.

“Partnership Interest” shall mean the entire general partnership interest or
limited partnership interest at any time owned by any Grantor in any general
partnership or limited partnership.

“Partner Interests” means all Partnership Interests owned by such Grantor from
time to time and all of its right, title and interest in each partnership,
whether now existing or

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hereafter acquired, including, without limitation, to the fullest extent
permitted under the terms and provisions of the documents and agreements
governing such Partnership Interests and applicable law:

(A) all its capital therein and its interest in all profits, income, surpluses,
losses, Partnership Assets and other distributions to which such Grantor shall
at any time be entitled in respect of such Partnership Interests;

(B) all other payments due or to become due to such Grantor in respect of
Partnership Interests, whether under any partnership agreement or otherwise,
whether as contractual obligations, damages, insurance proceeds or otherwise;

(C) all of its claims, rights, powers, privileges, authority, options, security
interests, liens and remedies, if any, under any partnership agreement or
operating agreement, or at law or otherwise in respect of such Partnership
Interests;

(D) all present and future claims, if any, of such Grantor against any such
partnership for monies loaned or advanced, for services rendered;

(E) all of such Grantor’s rights under any partnership agreement or operating
agreement or at law to exercise and enforce every right, power, remedy,
authority, option and privilege of such Grantor relating to such Partnership
Interests, including any power to terminate, cancel or modify any partnership
agreement or operating agreement, to execute any instruments and to take any and
all other action on behalf of and in the name of such Grantor in respect of such
Partnership Interests and any such partnership, to make determinations, to
exercise any election (including, but not limited to, election of remedies) or
option or to give or receive any notice, consent, amendment, waiver or approval,
together with full power and authority to demand, receive, enforce, collect or
receipt for any of the foregoing or for any Partnership Asset, to enforce or
execute any checks, or other instruments or orders, to file any claims and to
take any action in connection with any of the foregoing; and

(F) all other property hereafter delivered in substitution for or in addition to
any of the foregoing, all certificates and instruments representing or
evidencing such other property and all cash, securities, interest, dividends,
rights and other property at any time and from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all thereof;

“Patent License” means any written agreement, now or hereafter in effect,
granting to any third party any rights in any Patent, now or hereafter owned by
any Grantor or that any Grantor otherwise has the right to license, is in
existence, or granting to any Grantor rights in any Patent, now or hereafter
owned by any third party, is in existence, and all rights of any Grantor under
any such agreement.

“Patents” means patents of the United States or the equivalent thereof in any
other country, including any patent in or to which the any Grantor now or
hereafter have any right, title or interest therein, and any divisions,
reissues, continuations (including, but not limited to, continuations-in-parts)
and improvements thereof, as well as any application for a patent now or
hereafter made by any Grantor, whether in the United States or any other
jurisdiction and including the patents and patent applications listed on
Schedule III annexed hereto.

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“Permits” shall mean, to the extent permitted to be assigned by the terms
thereof or by applicable law, all licenses, permits, rights, orders, variances,
franchises or authorizations of or from any Governmental Authority.

“Pledged Collateral” has the meaning assigned to such term in Section 3.01.

“Pledged Debt” has the meaning assigned to such term in Section 3.01.

“Pledged Securities” means any promissory notes, stock certificates or other
securities now or hereafter included in the Pledged Collateral, including all
certificates, instruments or other documents representing or evidencing any
Pledged Collateral.

“Pledged Stock” has the meaning assigned to such term in Section 3.01.

“Proceeds” has the meaning specified in Section 9-102 of the New York UCC.

“Secured Creditors” means (a) the Lenders, (b) the Collateral Agent, (c) the
Administrative Agent and each other Agent, (d) each Other Creditor and (e) the
successors and permitted assigns of each of the foregoing.

“Securities Account Control Agreement” means an agreement substantially in the
form annexed hereto as Exhibit III or an agreement in a form that is reasonably
satisfactory to the Collateral Agent and the Borrower establishing the
Collateral Agent’s Control with respect to any Securities Account.

“Security Interest” has the meaning assigned to such term in Section 4.01(a).

“Trademark License” means any written agreement, now or hereafter in effect,
granting to any third party any right to use any Trademark now or hereafter
owned by any Grantor or that any Grantor otherwise has the right to license, or
granting to any Grantor any right to use any Trademark now or hereafter owned by
any third party, and all rights of any Grantor under any such agreement.

“Trademarks” means trademarks and service marks and all goodwill connected with
the use thereof and symbolized thereby, including all right, title and interest
in and to any trademarks, service marks and trade names now held or hereafter
acquired by any Grantor including any registration or application for
registration of any trademarks and service marks now held or hereafter acquired
by any Grantor, which are registered or filed in the United States Patent and
Trademark Office or the equivalent thereof in any state of the United States or
any equivalent foreign office or agency, as well as any unregistered trademarks
and service marks used by any Grantor and any trade dress including logos,
designs, fictitious business names and other business identifiers or indicia of
origin used by such Grantor, and including the trademarks and trademark
applications listed on Schedule III annexed hereto.

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“Voting Equity Interests” of any Person shall mean all classes of Equity
Interests of such Person entitled to vote.

ARTICLE II

Guaranty

Section 2.01. Guaranty. (a) Each of the Guarantors hereby, jointly and
severally, unconditionally and irrevocably, guarantees to the Collateral Agent,
for the ratable benefit of the Secured Creditors, and to the Secured Creditors
the prompt and complete payment and performance when due and payable (whether at
the stated maturity, by acceleration or otherwise) of all Obligations of the
Borrower and each other Credit Party.

(b) Each Guarantor and each Secured Creditor (by its acceptance of the benefits
of this Agreement) hereby confirms that it is its intention that the guaranty
made by the Guarantors not constitute a fraudulent transfer or conveyance for
purposes of the Bankruptcy Code, the Uniform Fraudulent Conveyance Act or any
similar Federal or state law. To effectuate the foregoing intention, each
Guarantor and each Secured Creditor (by its acceptance of the benefits of this
Agreement) hereby irrevocably agrees that the Obligations guaranteed by such
Guarantor shall be limited to such amount as will, after giving effect to such
maximum amount and all other (contingent or otherwise) liabilities of such
Guarantor that are relevant under such laws, not constitute a fraudulent
transfer or conveyance for purposes of such laws.

(c) Each Guarantor agrees that the Obligations guaranteed by it hereunder may at
any time and from time to time exceed the amount of the liability of such
Guarantor hereunder without impairing the guaranty contained in this Article II
or affecting the rights and remedies of the Collateral Agent or any other
Secured Creditor hereunder.

(d) No payment made by the Borrower, any of the Guarantors, any other guarantor
or any other Person or received or collected by the Collateral Agent or any
other Secured Creditor from the Borrower, any of the Guarantors, any other
guarantor or any other Person by virtue of any action or proceeding or any
set-off or appropriation or application at any time or from time to time in
reduction of or in payment of any of the Obligations shall be deemed to modify,
reduce, release or otherwise affect the liability of any Guarantor hereunder
(other than by, and only to the extent of, but without prejudice to
Section 2.04, reducing the amount of Obligations guaranteed hereunder) which
Guarantor shall, notwithstanding any such payment (other than any payment made
by such Guarantor in respect of the Obligations or any payment received or
collected from such Guarantor in respect of any of the Obligations), remain
liable for the Obligations guaranteed by it hereunder up to the maximum
liability of such Guarantor hereunder until (but subject to Section 2.04 in the
case of following clause (i)) the earlier to occur of (i) the first date on
which all the Loans and all other Obligations then due and owing, are paid in
full in cash and the Total Commitment has been terminated or (ii) the release of
such Guarantor from this Agreement in accordance with the express provisions of
Section 7.13(b) hereof.

Section 2.02. Amendments, etc. with respect to the Obligations. To the maximum
extent permitted by law, each Guarantor shall remain obligated hereunder

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notwithstanding that, without any reservation of rights against any Guarantor
and without notice to or further assent by any Guarantor, any demand for payment
of any of the Obligations made by the Collateral Agent or any other Secured
Creditor may be rescinded by the Collateral Agent or such other Secured Creditor
and any of the Obligations continued, and the Obligations, or the liability of
any other Person upon or for any part thereof, or any collateral security or
guaranty therefor or right of offset with respect thereto, may, from time to
time, in whole or in part, be renewed, extended, amended, modified, accelerated,
compromised, subordinated, waived, surrendered or released by the Collateral
Agent or any other Secured Creditor, and the Credit Agreement and the other
Credit Documents and any other documents executed and delivered in connection
therewith may be amended, waived, modified, supplemented or terminated, in whole
or in part, in accordance with their respective terms, as the Collateral Agent
(or the Required Lenders under the Credit Agreement, or the applicable
Lenders(s), as the case may be) and, to the extent required by applicable law or
the terms of the Credit Documents, the Borrower, from time to time, and any
collateral security, guaranty or right of offset at any time held by the
Collateral Agent or any other Secured Creditor for the payment of any of the
Obligations may be sold, exchanged, waived, surrendered or released. Neither the
Collateral Agent nor any other Secured Creditor shall have any obligation to
protect, secure, perfect or insure any Lien at any time held by it as security
for any of the Obligations or for the guaranty contained in this Article II or
any property subject thereto, except to the extent required by applicable law.

Section 2.03. Guaranty Absolute and Unconditional. (a) Each Guarantor waives, to
the maximum extent permitted by applicable law, any and all notice of the
creation, renewal, extension or accrual of any of the Obligations and notice of
or proof of reliance by the Collateral Agent or any other Secured Creditor upon
the guaranty contained in this Article II or acceptance of the guaranty
contained in this Article II; each of the Obligations, and any obligation
contained therein, shall conclusively be deemed to have been created, contracted
or incurred, or renewed, extended, amended or waived, in reliance upon the
guaranty contained in this Article II; and all dealings between the Borrower and
any of the other Credit Parties, on the one hand, and the Collateral Agent and
the other Secured Creditors, on the other hand, likewise shall be conclusively
presumed to have been had or consummated in reliance upon the guaranty contained
in this Article II. Each Guarantor waives, to the maximum extent permitted by
applicable law, diligence, presentment, protest, demand for payment and notice
of default or nonpayment to or upon any of the Borrower or any of the other
Credit Parties with respect to any of the Obligations. Each Guarantor
understands and agrees, to the extent permitted by law, that the guaranty
contained in this Article II shall be construed as a continuing, absolute and
unconditional guaranty of payment and not of collection. Each Guarantor hereby
waives, to the maximum extent permitted by applicable law, any and all defenses
that it may have arising out of or in connection with any and all of the
following: (a) the validity or enforceability of the Credit Agreement or any
other Credit Document, any of the Obligations or any other collateral security
therefor or guaranty or right of offset with respect thereto at any time or from
time to time held by the Collateral Agent or any other Secured Creditor, (b) any
defense, set-off or counterclaim (other than a defense of payment or
performance) that may at any time be available to or be asserted by the Borrower
or such Guarantor against the Collateral Agent or any other Secured Creditor,
(c) any change in the time, place, manner or place of payment or any amendment,
waiver or increase in any of the Obligations in accordance with the terms of the
documentation evidencing the same, (d) any exchange, taking, or release of
Collateral, (e) any change in the structure or existence of any of the Borrower
or any of its Subsidiaries (except in connection

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with any release permitted by Section 7.13 hereof or any other liquidation,
merger or dissolution permitted by the Credit Agreement), (f) any application of
Collateral to any of the Obligations (except to the extent the same constitutes,
subject to Section 2.04, a discharge and satisfaction of the Obligations),
(g) any law, regulation or order of any jurisdiction, or any other event,
affecting any term of any Obligation or the rights of the Collateral Agent or
any other Secured Creditor with respect thereto, including, without limitation:
(i) the application of any such law, regulation, decree or order, including any
prior approval, which would prevent the exchange of any currency (other than
Dollars) for Dollars or the remittance of funds outside of such jurisdiction or
the unavailability of Dollars in any legal exchange market in such jurisdiction
in accordance with normal commercial practice, (ii) a declaration of banking
moratorium or any suspension of payments by banks in such jurisdiction or the
imposition by such jurisdiction or any Governmental Authority thereof of any
moratorium on, the required rescheduling or restructuring of, or required
approval of payments on, any indebtedness in such jurisdiction, (iii) any
expropriation, confiscation, nationalization or requisition by such country or
any Governmental Authority that directly or indirectly deprives the Borrower or
any other Credit Party of any assets or their use, or of the ability to operate
its business or a material part thereof, or (iv) any war (whether or not
declared), insurrection, revolution, hostile act, civil strife or similar events
occurring in such jurisdiction which has the same effect as the events described
in clause (i), (ii) or (iii) above (in each of the cases contemplated in clauses
(i) through (iv) above, to the extent occurring or existing on or at any time
after the date of this Agreement), or (h) any other circumstance whatsoever
(other than payment in full in cash of the Obligations (other than inchoate
indemnity obligations) guaranteed by it hereunder) (with or without notice to or
knowledge of the Borrower or any other Credit Party) that constitutes, or might
be construed to constitute, an equitable or legal discharge of the Borrower or
any other Credit Party for its Obligations, or of such Guarantor under the
guaranty contained in this Article II, in bankruptcy or in any other instance.
When making any demand hereunder or otherwise pursuing its rights and remedies
hereunder against any Guarantor, the Collateral Agent or any other Secured
Creditor may, but shall be under no obligation to, make a similar demand on or
otherwise pursue such rights and remedies as it may have against the Borrower,
any other Guarantor or any other Person or against any collateral security or
guaranty for the Obligations guaranteed by such Guarantor hereunder or any right
of offset with respect thereto, and any failure by the Collateral Agent or any
other Secured Creditor to make any such demand, to pursue such other rights or
remedies or to collect any payments from the Borrower, any other Guarantor or
any other Person or to realize upon any such collateral security or guaranty or
to exercise any such right of offset, or any release of the Borrower, any other
Guarantor or any other Person or any such collateral security, guaranty or right
of offset, shall not relieve any Guarantor of any obligation or liability
hereunder, and shall not impair or affect the rights and remedies, whether
express, implied or available as a matter of law, of the Collateral Agent or any
other Secured Creditor against any Guarantor. For the purposes hereof “demand”
shall include the commencement and continuance of any legal proceedings.

(b) Each Guarantor hereby acknowledges and affirms that it understands that to
the extent the Obligations are secured by Real Property located in the State of
California, such Guarantor shall be liable for the full amount of the liability
hereunder notwithstanding foreclosure on such Real Property by trustee sale or
any other reason impairing such Guarantor’s or any Secured Creditors’ right to
proceed against any Borrower, any other Guaranteed Party or any other guarantor
of the Obligations.

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(c) Each Guarantor hereby waives (to the fullest extent permitted by applicable
law) all rights and benefits under Section 580a, 580b, 580d and 726 of the
California Code of Civil Procedure. Each Guarantor hereby further waives (to the
fullest extent permitted by applicable law), without limiting the generality of
the foregoing or any other provision hereof, all rights and benefits which might
otherwise be available to such Guarantor under Sections 2809, 2810, 2815, 2819,
2821, 2839, 2845, 2848, 2849, 2850, 2899 and 3433 of the California Civil Code.

(d) Until the Obligations (other than inchoate indemnity obligations) have been
paid in full in cash, each Guarantor waives its rights of subrogation and
reimbursement and any other rights and defenses available to such Guarantor by
reason of Sections 2787 to 2855, inclusive, of the California Civil Code,
including, without limitation, (1) any defenses such Guarantor may have to this
Guaranty by reason of an election of remedies by the Secured Creditors and
(2) any rights or defenses such Guarantor may have by reason of protection
afforded to the Borrower or any Guaranteed Party pursuant to the antideficiency
or other laws of California limiting or discharging such Borrower’s or such
other Guaranteed Party’s indebtedness, including, without limitation,
Section 580a, 580b, 580d or 726 of the California Code of Civil Procedure. In
furtherance of such provisions, each Guarantor hereby waives all rights and
defenses arising out of an election of remedies by the Secured Creditors, even
though that election of remedies, such as a non-judicial foreclosure, destroys
such Guarantor’s rights of subrogation and reimbursement against any Borrower or
any other Guaranteed Party by the operation of Section 580d of the California
Code of Civil Procedure or otherwise.

Section 2.04. Reinstatement. The guaranty of any Guarantor contained in this
Article II shall continue to be effective, or be reinstated, as the case may be,
if at any time payment, or any part thereof, of any of the Obligations
guaranteed by such Guarantor hereunder is rescinded or must otherwise be
restored or returned by the Collateral Agent or any other Secured Creditor upon
the insolvency, bankruptcy, dissolution, liquidation or reorganization of any
Borrower or any other Credit Party, or upon or as a result of the appointment of
a receiver, intervenor or conservator of, or trustee or similar officer for, any
Borrower or any other Credit Party or any substantial part of its property, or
otherwise, all as though such payments had not been made.

Section 2.05. Payments. Each Guarantor hereby guarantees that payments hereunder
will be paid to the Administrative Agent, for the benefit of the Secured
Creditors, without set-off, counterclaim or other defense and on the same basis
as payments are made by the Borrower under Sections 4.03 and 4.04 of the Credit
Agreement.

Section 2.06. Information. Each Guarantor assumes all responsibility for being
and keeping itself informed of the Borrower’s and each other Credit Party’s
financial condition and assets and of all other circumstances bearing upon the
risk of nonpayment of the Obligations and the nature, scope and extent of the
risks that such Guarantor assumes and incurs hereunder and agrees that none of
the Collateral Agent or the other Secured Creditors will have any duty to advise
such Guarantor of information known to it or any of them regarding such
circumstances or risks.

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ARTICLE III

Pledge of Securities

Section 3.01. Pledge. As security for the payment or performance, as applicable,
in full of the Obligations, each Grantor hereby grants to the Collateral Agent,
its successors and assigns, for the ratable benefit of the Secured Creditors, a
security interest in, all of such Grantor’s right, title and interest in, to and
under (a) the Equity Interests of any Person (including, without limitation, the
Borrower and each Subsidiary) owned by it on the date hereof or at any time
thereafter acquired by it, and in all certificates at any time representing any
such Equity Interests, and any other shares, stock certificates, options or
rights of any nature whatsoever in respect of the Equity Interests of any Person
that may be issued or granted to, or held by, such Grantor while this Agreement
is in effect (collectively, the “Pledged Stock”); provided that the Pledged
Stock shall not include any of the outstanding capital stock of a Foreign
Subsidiary in excess of 65% of the voting power of all classes of capital stock
of such Foreign Subsidiary entitled to vote; (b) all debt securities and
promissory notes held by, or owed to, such Grantor (whether the respective
issuer or obligor is the Borrower, any of its Subsidiaries or any other Person)
on the Effective Date or at any time thereafter, and all securities, promissory
notes and any other instruments evidencing the debt securities or promissory
notes described above (collectively, the “Pledged Debt”); (c) all Limited
Liability Company Interests; (d) all Partnership Interests; (e) all Securities
(and all options and warrants to purchase securities), owned or held by such
Grantor from time to time; (f) all Financial Assets and Investment Property
owned by such Grantor from time to time; (g) all other property that may be
delivered to and held by the Collateral Agent pursuant to the terms of this
Section 3.01; (h) all Security Entitlements owned by such Grantor from time to
time in any and all of the foregoing; (i) subject to Section 3.05, all payments
of principal or interest, dividends, cash, instruments and other property from
time to time received, receivable or otherwise distributed in respect of, in
exchange for or upon the conversion of, and all other Proceeds received in
respect of, the securities referred to in clauses (a), (b) and (c) above;
(j) subject to Section 3.05, all rights and privileges of such Grantor with
respect to the securities and other property referred to in clauses (a), (b),
(c) and (d) above; and (k) all Proceeds of any of the foregoing (the items
referred to in clauses (a) through (j) above being collectively referred to as
the “Pledged Collateral”).

Section 3.02. Delivery of the Pledged Collateral. (a) Each Grantor represents
and warrants that all certificates, agreements or instruments representing or
evidencing the Pledged Stock and the Pledged Debt in existence on the date
hereof have been delivered to the Collateral Agent in suitable form for transfer
by delivery or accompanied by duly executed instruments of transfer or
assignment in blank. Each Grantor agrees promptly to deliver or cause to be
delivered to the Collateral Agent any and all Pledged Stock and all debt
securities of a principal amount in excess of $500,000 constituting Pledged
Collateral now owned or hereafter acquired by such Grantor.

(b) In addition to the requirements of preceding clause (a), each Grantor will
cause any Indebtedness for borrowed money owed to such Grantor by any Person of
a principal amount which is in excess of $500,000 to be evidenced by a
promissory note to be delivered to the Collateral Agent.

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(c) Upon delivery to the Collateral Agent, (i) any Pledged Securities shall be
accompanied by undated stock powers duly executed in blank or other undated
instruments of transfer reasonably satisfactory to the Collateral Agent and by
such other instruments and documents as the Collateral Agent may reasonably
request that are necessary to perfect a security interest in such Pledged
Collateral and (ii) all other property comprising part of the Pledged Collateral
shall be accompanied by proper instruments of assignment duly executed by the
applicable Grantor and such other instruments or documents as the Collateral
Agent may reasonably request that are necessary to perfect a security interest
in such Pledged Collateral.

To the extent that any of the Pledged Collateral are uncertificated securities
registered in the name of any Grantor or its nominee or agent, such Grantor
shall promptly upon the Collateral Agent’s request deliver to the Collateral
Agent an irrevocable agreement of the issuer of such Pledged Collateral
satisfactory to the Collateral Agent, acting reasonably, that the issuer will
comply with instructions that are originated by the Collateral Agent without the
further consent of such Grantor and following an Event of Default cause the
issuer of the Pledged Collateral to register the Collateral Agent, or its agent
or nominee, as the Collateral Agent may direct, as the registered owner of such
Pledged Collateral.

Section 3.03. Representations, Warranties and Covenants. The Grantors jointly
and severally represent, warrant and covenant to and with the Collateral Agent,
for the benefit of the Secured Creditors, that:

(a) Schedule II correctly sets forth the percentage of the issued and
outstanding shares (or units or other comparable measure) of each class of the
Equity Interests of the issuer thereof represented by the Pledged Stock and
includes all Pledged Stock and Pledged Debt;

(b) to the knowledge of such Grantor (unless such Pledged Stock and Pledged Debt
has been issued by any of the Borrower’s direct or indirect Restricted
Subsidiaries, in which case this representation and warranty shall not be
qualified by knowledge), the Pledged Stock and Pledged Debt have been duly and
validly authorized and issued by the issuers thereof and (i) in the case of
Pledged Stock, are fully paid and nonassessable and (ii) in the case of Pledged
Debt, are legal, valid and binding obligations of the issuers thereof, except to
the extent that the enforceability thereof may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
generally affecting creditors’ rights and by equitable principles (regardless of
whether enforcement is sought in equity or at law);

(c) except for the security interests granted hereunder, each of the Grantors
(i) is and, subject to any transfers made in compliance with the Credit
Agreement, will continue to be the direct owner, beneficially and of record, of
the Pledged Securities indicated on Schedule II as owned by such Grantor,
(ii) holds the same free and clear of all Liens, other than Permitted Liens,
(iii) except for transfers permitted under the Credit Agreement, will make no
assignment, pledge, hypothecation or transfer of, or create or permit to exist
any security interest in or other Lien on, the Pledged Collateral, other than
Permitted Liens, and (iv) will use commercially reasonable efforts to defend its
title or interest thereto or therein against any and all Liens (other than
Permitted Liens), however arising, of all Persons whomsoever;

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(d) except for restrictions and limitations imposed by (i) the Credit Documents,
(ii) securities laws generally or (iii) customary provisions in joint venture
agreements relating to purchase options, rights for first refusal, tag, drag,
call or similar rights of a third party that owns Equity Interests in such joint
venture, the Pledged Collateral is and will continue to be freely transferable
and assignable, and, except as otherwise expressly permitted by the Credit
Agreement, none of the Pledged Collateral is or will be subject to any option,
right of first refusal, shareholders agreement, charter or by-law provision or
contractual restriction of any nature that might prohibit, impair, delay or
otherwise affect the pledge of such Pledged Collateral hereunder, the sale or
disposition thereof pursuant hereto or the exercise by the Collateral Agent of
rights and remedies hereunder;

(e) each of the Grantors has the power and authority to pledge the Pledged
Collateral pledged by it hereunder in the manner hereby done or contemplated;

(f) no consent or approval of any Governmental Authority, any securities
exchange or any other Person was or is necessary to the validity of the pledge
effected hereby (other than such as have been obtained and are in full force and
effect); and

(g) by virtue of the execution and delivery by the Grantors of this Agreement,
when (x) any Pledged Securities are delivered to the Collateral Agent in
accordance with this Agreement or (y) the filing of the Uniform Commercial Code
financing statements with respect to the respective Grantor are made as
described in Section 4.02(a), the Collateral Agent will obtain, for the benefit
of the Secured Creditors, a legal, valid and perfected first-priority lien upon
and security interest in such Pledged Securities as security for the payment and
performance of the Obligations to the extent such security interest may be
perfected by possession or control or filing of a Uniform Commercial Code
financing statement (as applicable).

Section 3.04. Registration in Nominee Name; Denominations. The Collateral Agent,
on behalf of the Secured Creditors, shall have the right (in its sole and
absolute discretion) to hold the Pledged Securities in the name of the
applicable Grantor, endorsed or assigned in blank or in favor of the Collateral
Agent or, upon the occurrence of an Event of Default that is continuing, in its
own name as pledgee or the name of its nominee (as pledgee or as sub-agent).
Each Grantor will promptly give to the Collateral Agent copies of any material
notices or other communications received by it with respect to Pledged
Securities registered in the name of such Grantor. The Collateral Agent shall at
all times upon the occurrence of an Event of Default that is continuing have the
right to exchange the certificates representing Pledged Securities for
certificates of smaller or larger denominations for any purpose consistent with
this Agreement.

Section 3.05. Voting Rights; Dividends and Interest. (a) Unless and until an
Event of Default shall have occurred and be continuing and the Collateral Agent
shall have notified the Grantors, in accordance with paragraph (d) below, that
their rights under this Section 3.05 are being suspended:

(i) Each Grantor shall be entitled to exercise any and all voting and other
consensual rights and powers inuring to an owner of Pledged Securities or any
part thereof for any purpose consistent with the terms in this Agreement, the
Credit

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Agreement and the other Credit Documents, provided that, except as expressly
permitted under the Credit Agreement, such rights and powers shall not be
exercised in any manner that would reasonably be expected to materially and
adversely affect the rights inuring to a holder of any Pledged Securities or the
rights and remedies of any of the Collateral Agent or the other Secured
Creditors under this Agreement or the Credit Agreement or any other Credit
Document or the ability of the Collateral Agent (on behalf of the Secured
Creditors) to exercise the same.

(ii) Each Grantor shall be entitled to receive and retain any and all dividends,
interest, principal and other distributions paid on or distributed in respect of
the Pledged Securities to the extent and only to the extent that such dividends,
interest, principal and other distributions are not prohibited by the terms and
conditions of the Credit Agreement, the other Credit Documents and applicable
laws, provided that (x) any noncash dividends, interest, principal or other
distributions that would constitute Pledged Stock or Pledged Debt, whether
resulting from a subdivision, combination or reclassification of the outstanding
Equity Interests of the issuer of any Pledged Securities or received in exchange
for Pledged Securities or any part thereof, or in redemption thereof, or as a
result of any merger, consolidation, acquisition or other exchange of assets to
which such issuer may be a party or otherwise, shall be and become part of the
Pledged Collateral, and, if received by any Grantor, shall not be commingled by
such Grantor with any of its other funds or property but shall be held separate
and apart therefrom, shall be held in trust for the benefit of the Collateral
Agent and the other Secured Creditors and shall be forthwith delivered to the
Collateral Agent in the same form as so received (with any necessary endorsement
as described in Section 3.03(c) or otherwise) and (y) any Article 9 Collateral
so received shall be subject to the applicable provisions of Article IV hereof.

(b) Upon the occurrence of an Event of Default that is continuing, after the
Collateral Agent shall have notified the Grantors in writing of the suspension
of their rights under paragraph (a)(ii) of this Section 3.05, all rights of any
Grantor to dividends, interest, principal or other distributions that such
Grantor is authorized to receive in accordance with paragraph (a)(ii) of this
Section 3.05 shall cease, and all such rights shall thereupon become vested in
the Collateral Agent, which shall have the sole and exclusive right and
authority to receive and retain such dividends, interest, principal or other
distributions. All dividends, interest, principal or other distributions
received by any Grantor contrary to the provisions of this Section 3.05 shall be
held in trust for the benefit of the Collateral Agent and the other Secured
Creditors, shall be segregated from other property or funds of such Grantor and
shall be forthwith delivered to the Collateral Agent upon written demand in the
same form as so received (with any necessary endorsement). Any and all money and
other property paid over to or received by the Collateral Agent pursuant to the
provisions of this paragraph (b) shall be retained by the Collateral Agent in an
account to be established by the Collateral Agent upon receipt of such money or
other property and shall be applied in accordance with the provisions of
Section 5.02.

(c) Upon the occurrence of an Event of Default that is continuing, after the
Collateral Agent shall have notified in writing the Grantors of the suspension
of their rights under paragraph (a)(i) of this Section 3.05, all rights of any
Grantor to exercise the voting and

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other consensual rights and powers it is entitled to exercise in accordance with
paragraph (a)(i) of this Section 3.05 shall cease, and all such rights shall
thereupon become vested in the Collateral Agent, which shall have the sole and
exclusive right and authority to exercise such voting and other consensual
rights and powers, provided that, unless otherwise directed by the Required
Lenders, the Collateral Agent shall have the right from time to time following
of an Event of Default that is continuing to permit the Grantors to exercise
such rights. After all Events of Default have been cured or waived, the Grantors
shall have the right to exercise the voting and consensual rights and powers
that they would otherwise be entitled to exercise in accordance with the terms
of paragraph (a)(i) above.

(d) Any notice given by the Collateral Agent to the Grantors suspending their
rights under paragraph (a) of this Section 3.05 (i) may be given by telephone if
promptly confirmed in writing, (ii) may be given to one or more of the Grantors
at the same or different times and (iii) may suspend the rights of the Grantors
under paragraph (a)(i) or paragraph (a)(ii) of this Section 3.05 in part without
suspending all such rights (as specified by the Collateral Agent in its sole and
absolute discretion) and without waiving or otherwise affecting the Collateral
Agent’s rights to give additional notices from time to time suspending other
rights so long as an Event of Default has occurred and is continuing.

ARTICLE IV

Security Interests in Personal Property

Section 4.01. Security Interest. (a) As security for the payment or performance,
as applicable, in full of the Obligations, each Grantor hereby grants to the
Collateral Agent, its successors and permitted assigns, for the ratable benefit
of the Secured Creditors, a security interest (the “Security Interest”) in all
right, title or interest in or to any and all of the following assets and
properties now owned or at any time hereafter acquired by such Grantor or in
which such Grantor now has or at any time in the future may acquire any right,
title or interest (collectively, the “Article 9 Collateral”):

(i) all Accounts;

(ii) all Chattel Paper;

(iii) all cash and Deposit Accounts;

(iv) all Documents;

(v) all Goods;

(vi) all Equipment;

(vii) all General Intangibles including, without limitation, all Intellectual
Property, Permits, Contracts and Contract Rights;

(viii) all Instruments;

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(ix) all Inventory;

(x) all Investment Property;

(xi) all Letter of Credit Rights;

(xii) the commercial tort claims specified on Schedule IV or otherwise specified
by a Grantor to the Collateral Agent pursuant to Section 4.04(d);

(xiii) all books and records; and

(xiv) to the extent not otherwise included, all Proceeds and products of any and
all of the foregoing and all collateral security, supporting obligations and
guarantees given by any Person with respect to any of the foregoing.

Notwithstanding the foregoing, the Article 9 Collateral shall not include
(i) any Equipment owned by any Grantor that is subject to a purchase money
security interest (as defined in Section 9-103 of the New York UCC) or a
Capitalized Lease Obligation to the extent the documents relating to such
purchase money interest or Capitalized Lease Obligation would not permit such
Equipment to be subject to the Security Interests created hereby, (ii) any
lease, license, contract, property right or agreement (or any of its rights or
interests thereunder) if and to the extent that the grant of the security
interest shall, after giving effect to Sections 9-406, 9-407, 9-408 or 9-409 of
the New York UCC (or any successor provision or provisions) or any other
applicable law, constitute or result in (A) the abandonment, invalidation or
unenforceability of any right, title or interest of such Grantor therein or
(B) a breach or termination pursuant to the terms of, or a default under, any
such lease license, contract, property rights or agreement, (iii) any lease,
license, contract, property rights or agreement to which any Grantor is a party,
any of its rights or interests thereunder or any assets subject thereto to the
extent that any applicable law prohibits the creation of a security interest
thereon (other than to the extent that any such term would be rendered
ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the New York
UCC (or any successor provision or provisions) in any relevant jurisdiction or
any other applicable law or principles of equity) and (iv) any of the
outstanding capital stock of a Foreign Subsidiary in excess of 65% of the voting
power of all classes of capital stock of such Foreign Subsidiary entitled to
vote.

(b) Each Grantor hereby irrevocably authorizes the Collateral Agent at any time
and from time to time to file in any relevant jurisdiction any financing
statements (including fixture filings) with respect to the Collateral or any
part thereof and amendments thereto that (i) indicate the Collateral as “all
assets” of such Grantor or such other description as the Collateral Agent may
determine and (ii) contain the information required by Article 9 of the Uniform
Commercial Code of each applicable jurisdiction for the filing of any financing
statement or amendment, including (A) whether such Grantor is an organization,
the type of organization and any organizational identification number, if any,
issued to such Grantor and (B) in the case of a financing statement filed as a
fixture filing or covering Collateral constituting minerals or the like to be
extracted or timber to be cut, a sufficient description of the real property to
which such Collateral relates. Each Grantor agrees to provide such information
to the Collateral Agent promptly upon request.

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Each Grantor also ratifies its authorization for the Collateral Agent to file in
any relevant jurisdiction any financing statements (including fixture filings,
as applicable) or other appropriate filings, recordings or registrations or
amendments thereto.

The Collateral Agent is further authorized to file with the United States Patent
and Trademark Office or United States Copyright Office (or any successor office
or any similar office in any other country) such documents as may be necessary
or advisable for the purpose of perfecting, confirming, continuing, enforcing or
protecting the Security Interest granted by each Grantor, without the signature
of any Grantor, and naming any Grantor or the Grantors as debtors and the
Collateral Agent as secured party.

(c) The Security Interest is granted as security only and shall not subject the
Collateral Agent or any other Secured Creditor to, or in any way alter or
modify, any obligation or liability of any Grantor with respect to or arising
out of the Collateral.

Section 4.02. Representations and Warranties. The Grantors jointly and severally
represent and warrant to the Collateral Agent and the other Secured Creditors
that:

(a) Each Grantor has good and valid rights in and title to the Article 9
Collateral and has full power and authority to grant to the Collateral Agent,
for the ratable benefit of the Secured Creditors, the Security Interest in such
Article 9 Collateral pursuant hereto and to execute, deliver and perform its
obligations in accordance with the terms in this Agreement, without the consent
or approval of any other Person other than any consent or approval that has been
obtained.

(b) Attached on Part A of Schedule VII is, as of the Closing Date, (i) the exact
legal name of each Grantor as such name appears in its respective certificate or
document of formation, (ii) each other legal name such Grantor has had in the
past five years, including the date of the relevant name change (if any), and
(iii) each other name, including trade names and similar appellations, such
Grantor or any of its divisions or other business units has used in connection
with the conduct of its business or the ownership of its properties at any time
during the past five years.

(c) Except as set forth on Part B of Schedule VII, as of the Closing Date, no
Grantor has changed its identity or business structure in any way within the
past five years. Changes in identity and business structure include mergers,
acquisitions and consolidations, as well as any change in form, nature or
jurisdiction of formation. If any such merger, acquisition or consolidation has
occurred, Schedule VII Part B sets forth the information required by
Section 4.02(b) and (c) as to each acquiree and each other constituent party to
such merger, acquisition or consolidation.

(d) Attached as Part C of Schedule VII is, as of the Closing Date, the (i) type
of organization of each Grantor, the location of each Grantor that is a
registered organization, (ii) organizational identification number, if any, of
such Grantor, (iii) address (including the county) of the chief executive office
of such Grantor and (iv) the federal taxpayer identification number of each
Grantor.

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(e) Attached as Schedule VIII, as of the Initial Borrowing Date, is the name and
address of any Person other than a Grantor that has possession of any Collateral
in excess of $500,000.

(f) Attached as Schedule IV is, as of the Closing Date, a true and correct list
of commercial tort claims in excess of $500,000 held by any Grantor, including a
brief description thereof.

(g) The UCC financing statements or other appropriate filings, recordings or
registrations prepared by the Collateral Agent based upon the information
provided to the Collateral Agent by the Grantors pursuant to this Agreement for
filing in each governmental, municipal or other office specified in Schedule IX
(or specified by notice from the Borrower to the Collateral Agent after the
Closing Date in the case of filings, recordings or registrations required by
Section 7.12 of the Credit Agreement), are all the filings, recordings and
registrations (other than (i) filings required to be made in the United States
Patent and Trademark Office and the United States Copyright Office, or any other
similar state or foreign office in order to perfect the Security Interest in
Article 9 Collateral consisting of Patents and Patent applications, Trademarks
(and Trademarks for which registration applications are pending) and registered
and applied-for Copyrights, (ii) registrations required to be made with regard
to any Collateral which is the subject of any certificate of title or similar
statute, (iii) filings or notices required to be made under any applicable
Assignment of Claims Act (or similar statute) in respect of any Governmental
Authority which is an Account Debtor and (iv) filings pertaining to the
perfection of fixtures) that are necessary to publish notice of and protect the
validity of and to establish a legal, valid and perfected security interest in
favor of the Collateral Agent, for the ratable benefit of the Secured Creditors,
in respect of all Collateral in which a security interest may be perfected by
filing, recording or registration in the United States (or any political
subdivision thereof) and its territories and possessions, and no further or
subsequent filing, refiling, recording, rerecording, registration or
reregistration is necessary in any such jurisdiction, except as provided under
applicable law with respect to the filing of continuation statements or with
respect to any changed circumstances requiring an amendment to such filing under
applicable law. Each Grantor represents and warrants that a fully executed
agreement in the form attached hereto as Exhibit IV, V or VI, as the case may
be, and containing a description of all Article 9 Collateral consisting of
Intellectual Property with respect to United States Patents and Patent
applications, United States registered Trademarks (and Trademarks for which
United States registration applications are pending) and United States
registered and applied-for Copyrights, in each case owned by any Grantor on the
date hereof have been delivered to the Collateral Agent for recording by the
United States Patent and Trademark Office and the United States Copyright Office
pursuant to 35 U.S.C. § 261, 15 U.S.C. § 1060 or 17 U.S.C. § 205 and the
regulations thereunder, as applicable to protect the validity of and to
establish a legal, valid and perfected security interest in favor of the
Collateral Agent, for the ratable benefit of the Secured Creditors, in respect
of all Article 9 Collateral consisting of United States Patents and Patent
applications, United States registered Trademarks (and Trademarks for which
United States registration applications are pending) and United States
registered and applied-for Copyrights, in each case owned by any Grantor as of
the date hereof, in which a security interest may be perfected by filing,
recording or registration in the United States Patent and Trademark Office or
the United States Copyright Office, as applicable, and no further or subsequent
filing, refiling, recording, rerecording, registration or reregistration is
necessary (other than such actions

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as are necessary to perfect the Security Interest with respect to any Article 9
Collateral consisting of United States Patents and Patent applications, United
States registered Trademarks (and Trademarks for which United States
registration applications are pending) and United States registered and
applied-for Copyrights acquired or developed after the date hereof or with
respect to any changed circumstances requiring an amendment to such filing under
applicable law).

(h) The Security Interest constitutes (i) a legal and valid security interest in
all the Article 9 Collateral securing the payment and performance of the
Obligations, (ii) subject to the filings described in Section 4.02(f), a
perfected security interest in all Article 9 Collateral in which a security
interest may be perfected by filing, recording or registering a financing
statement or analogous document in the United States (or any political
subdivision thereof) and its territories and possessions pursuant to the UCC or
other applicable law in such jurisdictions and (iii) a security interest that
shall be perfected in all Article 9 Collateral in which a security interest may
be perfected by and upon the receipt and recording of a Grant of Security
Interest in United States Trademarks (and Trademarks for which United Stated
registration applications are pending), United States Patents and Patent
applications and United States registered and applied-for Copyrights, in each
case owned by any Grantor on the date hereof as the case may be, in the form
(appropriately completed) attached hereto as Exhibits, IV, V and VI,
respectively with the United States Patent and Trademark Office and the United
States Copyright Office, as applicable, within the three-month period
(commencing as of the date hereof) pursuant to 35 U.S.C. § 261 or 15 U.S.C.
§ 1060 or the one-month period (commencing as of the date hereof) pursuant to
17 U.S.C. § 205 and otherwise as may be required pursuant to the laws of any
other necessary jurisdiction. The Security Interest is and shall be prior to any
other Lien on any of the Article 9 Collateral, other than Permitted Liens.

(i) The Article 9 Collateral is owned by the Grantors free and clear of any
Lien, except for Permitted Liens. None of the Grantors has filed or consented to
the filing of (i) any financing statement or analogous document under the UCC or
any other applicable laws covering any Collateral, (ii) any assignment intended
as security in which any Grantor assigns any Collateral or any security
agreement or similar instrument covering any Article 9 Collateral with the
United States Patent and Trademark Office or the United States Copyright Office
or (iii) any assignment intended as security in which any Grantor assigns any
Article 9 Collateral or any security agreement or similar instrument covering
any Article 9 Collateral with any foreign governmental, municipal or other
office, which financing statement or analogous document, assignment, security
agreement or similar instrument is still in effect, except, in each case, for
Permitted Liens.

Section 4.03. Covenants. (a) Each Grantor agrees promptly (but in no case more
than 15 days) to notify the Collateral Agent in writing of any change (i) in its
corporate name, (ii) in the location of its chief executive office or its
principal place of business, (iii) in its identity or type of organization or
corporate structure, (iv) in its Federal Taxpayer Identification Number or
organizational identification number or (v) in its jurisdiction of organization.
Each Grantor agrees to promptly provide the Collateral Agent with certified
organizational documents reflecting any of the changes described in the first
sentence of this Section 4.03(a). Each Grantor agrees not to effect or permit
any change referred to in the second preceding sentence if the effect of such
change is (x) such Grantor, if a registered organization, ceasing to constitute
the same or (y) such Grantor changing its jurisdiction of organization or
location from the United

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States or a State thereof to a jurisdiction of organization or location, as the
case may be, outside the United States or a State thereof. Each Grantor agrees
promptly to notify the Collateral Agent if any portion of the Article 9
Collateral owned or held by such Grantor is damaged or destroyed which,
individually or in the aggregate, would cause a Material Adverse Effect
(excluding Article 9 Collateral consisting of Intellectual Property which is
governed exclusively by Section 4.05).

(b) Each Grantor shall, at its own expense, take any and all actions necessary
to defend title to the Collateral (other than (i) Collateral that is deemed by
such Grantor to be immaterial to the conduct of its business and (ii) Article 9
Collateral consisting of Intellectual Property which is governed exclusively by
Section 4.05) against all Persons claiming any interest adverse to the
Collateral Agent or any other Secured Creditor (other than the holders of
Permitted Liens) and to defend the security interests of the Collateral Agent in
the Collateral and the priority thereof against any Lien (other than Permitted
Liens). Nothing in this Agreement shall prevent any Grantor from discontinuing
the operation or maintenance of any of its assets or properties if such
discontinuance is (x) in the judgment of its board of directors, desirable in
the conduct of its business and (y) permitted by the Credit Agreement.

(c) Each Grantor agrees, at its own expense, to execute, acknowledge, deliver
and cause to be duly filed all such further instruments and documents and take
all such actions as the Collateral Agent may from time to time reasonably
request to preserve, protect and perfect the security interests and the rights
and remedies created hereby, including the payment of any fees and taxes
required in connection with the execution and delivery of this Agreement, the
granting of the security interests hereunder and the filing of any financing
statements (including fixture filings) or other documents (including execution
of agreements in the form of Exhibits IV, V and VI attached hereto and delivery
to the Collateral Agent for filing such agreements with the United States Patent
and Trademark Office or United States Copyright Office, as applicable, and any
filings or notices required to be made under any applicable Assignment of Claims
Act (or similar statute) in respect of any Governmental Authority which is an
Account Debtor) in connection herewith or therewith. If any amount payable to
any Grantor under or in connection with any of the Article 9 Collateral shall be
or become evidenced by any promissory note or other instrument issued to such
Grantor (i) by the Borrower or any of its Subsidiaries or (ii) by any third
Person, in either case, and the face amount of such promissory note or other
instrument is in excess of $500,000, in each such case such note or instrument
shall be promptly pledged and delivered to the Collateral Agent, duly endorsed
in a manner reasonably satisfactory to the Collateral Agent.

(d) At its option, the Collateral Agent may discharge past due Taxes,
assessments, charges, fees or Liens at any time levied or placed on the
Collateral and not permitted pursuant to Section 8.01 of the Credit Agreement,
and may pay for the maintenance and preservation of the Article 9 Collateral to
the extent any Grantor fails to do so as required by the Credit Agreement or
this Agreement, and each Grantor jointly and severally agrees to reimburse the
Collateral Agent on demand for any payment made or any expense incurred by the
Collateral Agent pursuant to the foregoing authorization, provided that nothing
in this paragraph shall be interpreted as excusing any Grantor from the
performance of, or imposing any obligation on the Collateral Agent or any
Secured Creditor to cure or perform, any covenants or other promises of any
Grantor with respect to Taxes, assessments, charges, fees, Liens and maintenance
as set forth in this Agreement or in the other Credit Documents.

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(e) If at any time any Grantor shall take a security interest in any property of
an Account Debtor or any other Person with a value in excess of $500,000 to
secure payment and performance of an Account, such Grantor shall promptly assign
such security interest to the Collateral Agent. Such assignment need not be
filed of public record unless necessary to continue the perfected status of the
security interest against creditors of and transferees from the Account Debtor
or other Person granting the security interest.

(f) Each Grantor shall remain liable to observe and perform all the conditions
and material obligations to be observed and performed by it under each contract,
agreement or instrument relating to the Collateral, all in accordance with the
terms and conditions thereof.

(g) None of the Grantors shall make or permit to be made an assignment, pledge
or hypothecation of the Collateral or shall grant any other Lien in respect of
the Collateral, except as permitted by the Credit Agreement. Subject to the
immediately following sentence, none of the Grantors shall make or permit to be
made any transfer of the Collateral and each Grantor shall remain at all times
in possession of the Collateral owned by it, except (i) as permitted by Sections
8.01, 8.02 or 8.05 of the Credit Agreement, (ii) for any such Collateral as may
be in transit from time to time or out for repair or maintenance, (iii) for
Collateral consisting of equipment in possession of persons affiliated with the
Grantors or movable equipment that is temporarily removed by employees, in each
case in the ordinary course of business, (iv) for Collateral consisting of
Intellectual Property that such Grantor determines in its good faith business
judgment to transfer, dispose of or discontinue the use or maintenance thereof
would not result in a Material Adverse Effect and (v) otherwise for purchase or
lease by such Grantor’s customers in the ordinary course of business. Without
limiting the generality of the foregoing, each Grantor agrees that it shall not
permit any Inventory to be in the possession or control of any warehouseman,
agent, bailee, or processor at any time unless (x) such Inventory is in transit
at such time, (y) the aggregate fair value of the Inventory in the possession of
or subject to the control of such Person is less than $500,000 or (z) such
Person shall have been notified of the Security Interest and shall have
acknowledged in writing, in form and substance reasonably satisfactory to the
Collateral Agent, that such warehouseman, agent, bailee or processor holds the
Inventory for the benefit of the Collateral Agent subject to the Security
Interest and shall act upon the instructions of the Collateral Agent without
further consent from the Grantor, and that such warehouseman, agent, bailee or
processor further agrees to waive and release any Lien held by it with respect
to such Inventory, whether arising by operation of law or otherwise.

(h) None of the Grantors will, without the Collateral Agent’s prior written
consent, grant any extension of the time of payment of any Accounts included in
the Article 9 Collateral, compromise, compound or settle the same for less than
the full amount thereof, release, wholly or partly, any Person liable for the
payment thereof or allow any credit or discount whatsoever thereon, other than
compromises, compoundings, settlements and collections made in the ordinary
course of business or in accordance with the reasonable business judgment of
such Grantor.

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(i) The Grantors, at their own expense, shall maintain or cause to be maintained
insurance covering physical loss or damage to the Inventory and Equipment in
accordance with the requirements set forth in Section 7.03 of the Credit
Agreement. Each Grantor irrevocably makes, constitutes and appoints the
Collateral Agent (and all officers, employees or agents designated by the
Collateral Agent) as such Grantor’s true and lawful agent (and attorney-in-fact)
for the purpose, upon the occurrence of an Event of Default that is continuing,
of making, settling and adjusting claims in respect of Article 9 Collateral
under policies of insurance, endorsing the name of such Grantor on any check,
draft, instrument or other item of payment for the proceeds of such policies of
insurance and for making all determinations and decisions with respect thereto.
In the event that any Grantor at any time or times shall fail to obtain or
maintain any of the policies of insurance required under the Credit Agreement or
to pay any premium in whole or part relating thereto, the Collateral Agent may,
without waiving or releasing any obligation or liability of the Grantors
hereunder or any Event of Default, in its sole reasonable discretion, obtain and
maintain such policies of insurance and pay such premium and take any other
actions with respect thereto as the Collateral Agent deems advisable. All sums
disbursed by the Collateral Agent in connection with this paragraph, including
reasonable attorneys’ fees, court costs, out-of-pocket expenses and other
charges relating thereto, shall be payable, upon demand, by the Grantors to the
Collateral Agent and shall be additional Obligations secured hereby.

Section 4.04. Other Actions. In order to insure the attachment, perfection and
priority of, and the ability of the Collateral Agent to enforce, the Security
Interest in accordance with the terms hereof, each Grantor agrees, in each case
at such Grantor’s own expense, to take the following actions with respect to the
following Article 9 Collateral:

(a) Instruments and Tangible Chattel Paper. Each Grantor represents and warrants
that each Instrument and each item of Tangible Chattel Paper with a value in
excess of $500,000 in existence on the date hereof has been properly endorsed,
assigned and delivered to the Collateral Agent, accompanied by instruments of
transfer or assignment duly executed in blank. If any Grantor shall at any time
hold or acquire any Instruments or Chattel Paper with a value in excess of
$500,000, such Grantor shall forthwith endorse, assign and deliver the same to
the Collateral Agent, accompanied by such undated instruments of transfer or
assignment duly executed in blank as the Collateral Agent may from time to time
reasonably request.

(b) Electronic Chattel Paper and Transferable Records. If any Grantor at any
time holds or acquires an interest in any electronic chattel paper or any
“transferable record,” as that term is defined in Section 201 of the Federal
Electronic Signatures in Global and National Commerce Act, or in Section 16 of
the Uniform Electronic Transactions Act as in effect in any relevant
jurisdiction, such Grantor shall promptly notify the Collateral Agent thereof
and, at the request of the Collateral Agent, shall take such action as the
Collateral Agent may reasonably request to vest in the Collateral Agent control
under New York UCC Section 9-105 of such electronic chattel paper or control
under Section 201 of the Federal Electronic Signatures in Global and National
Commerce Act or, as applicable, Section 16 of the Uniform Electronic
Transactions Act, as in effect in such jurisdiction, of such transferable
record; provided that no Grantor shall be required to take any action described
above in this clause (b) unless the aggregate amount payable to the Grantors
evidenced by Electronic Chattel Paper or any transferable record in which the
Collateral Agent has not been vested control within the meaning

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of the statutes described above in this clause (b) exceeds $500,000. The
Collateral Agent agrees with such Grantor that the Collateral Agent will
arrange, pursuant to procedures reasonably satisfactory to the Collateral Agent
and so long as such procedures will not result in the Collateral Agent’s loss of
control, for the Grantor to make alterations to the electronic chattel paper or
transferable record permitted under UCC Section 9-105 or, as applicable,
Section 201 of the Federal Electronic Signatures in Global and National Commerce
Act or Section 16 of the Uniform Electronic Transactions Act for a party in
control to allow without loss of control, unless an Event of Default has
occurred and is continuing or would occur after taking into account any action
by such Grantor with respect to such electronic chattel paper or transferable
record.

(c) Letter-of-Credit Rights. If any Grantor is at any time a beneficiary under a
letter of credit now or hereafter issued in favor of such Grantor in an amount
in excess of $500,000, such Grantor shall promptly notify the Collateral Agent
thereof and, at the request and option of the Collateral Agent, such Grantor
shall, pursuant to an agreement in form and substance reasonably satisfactory to
the Collateral Agent, use commercially reasonable efforts to either (i) arrange
for the issuer and any confirmer of such letter of credit to consent to an
assignment to the Collateral Agent of the proceeds of any drawing under such
letter of credit or (ii) arrange for the Collateral Agent to become the
transferee beneficiary of such letter of credit, with the Collateral Agent
agreeing, in each case, that the proceeds of any drawing under such letter of
credit are to be paid to the applicable Grantor unless an Event of Default has
occurred or is continuing.

(d) Commercial Tort Claims. If any Grantor shall at any time hold or acquire a
commercial tort claim in an amount reasonably estimated to exceed $500,000, the
Grantor shall promptly notify the Collateral Agent thereof in a writing signed
by such Grantor including a summary description of such claim and grant to the
Collateral Agent, for the ratable benefit of the Secured Creditors, in such
writing a security interest therein and in the proceeds thereof, all upon the
terms of this Agreement, with such writing to be in form and substance
reasonably satisfactory to the Collateral Agent.

Section 4.05. Covenants Regarding Patent, Trademark and Copyright Collateral.
(a) Each Grantor agrees that it will not do any act or omit to do any act (and
will exercise commercially reasonable efforts to prevent its licensees from
doing any act or omitting to do any act) whereby any Patent would become
invalidated or dedicated to the public unless such invalidation or dedication to
the public would reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect. Each Grantor further agrees that it shall
continue to mark any products covered by a Patent with the relevant patent
number as necessary and sufficient in its reasonable judgment to establish and
preserve its material rights under applicable patent laws.

(b) Each Grantor (either itself or through its licensees or its sublicensees)
will, for each Trademark owned by such Grantor and material to the conduct of
such Grantors’ business (taken as a whole), (i) use commercially reasonable
efforts to maintain such Trademark free from any claim of abandonment or
invalidity for non-use, (ii) use commercially reasonable efforts to maintain the
quality of products and services offered under such Trademark, (iii) display
such Trademark with notice of Federal or foreign registration (or, if such
Trademark

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is unregistered, display such Trademark with notice as required for unregistered
Trademarks) to the extent necessary and sufficient in its reasonable business
judgment to establish and preserve its material rights under applicable
trademark laws and (iv) not knowingly use or permit the use of such Trademark in
any violation of any third party rights. The parties acknowledge that,
notwithstanding the foregoing, such Grantor may elect to abandon or otherwise
discontinue maintenance of any Trademark if (i) such Grantor determines in its
good faith business judgment that such abandonment or discontinuance is
desirable in the conduct of its business and (ii) such abandonment or
discontinuance would not result in a Material Adverse Effect.

(c) Each Grantor (either itself or through its licensees or sublicensees) will,
for each work covered by a Copyright material to the conduct of such Grantor’s
business (taken as a whole), continue to publish, reproduce, display, adopt and
distribute the work with appropriate copyright notice as necessary and
sufficient in its reasonable business judgment to establish and preserve its
material rights under applicable copyright laws.

(d) Each Grantor shall notify the Collateral Agent promptly if it knows that any
Patent, Trademark or Copyright owned by such Grantor and material to the conduct
of such Grantor’s business (taken as a whole) could reasonably be expected to
become abandoned, lost or dedicated to the public, or of any materially adverse
determination or development (including the institution of, or any such
determination or development in, any proceeding, other than ex parte office
actions, in the United States Patent and Trademark Office, United States
Copyright Office or any court or similar office of any country) regarding such
Grantor’s ownership of any such Patent, Trademark or Copyright, its right to
register the same, or its right to keep and maintain the same; provided, that
the parties acknowledge that nothing in this Agreement prevents such Grantor
from disposing of or discontinuing the use or maintenance of any of its
Intellectual Property if (i) such Grantor determines in its good faith business
judgment that such disposal or discontinuance is desirable in the conduct of its
business and (ii) such disposition or discontinuance would not result in a
Material Adverse Effect.

(e) In no event shall any Grantor, either itself or through any agent, employee,
licensee or designee, file an application with respect to any Patent, Trademark
or Copyright with the United States Patent and Trademark Office or the United
States Copyright Office or in any other country or any political subdivision
thereof, unless it promptly thereafter informs the Collateral Agent and, upon
request of the Collateral Agent, executes and delivers any and all agreements,
instruments, documents and papers as the Collateral Agent may reasonably request
to evidence the Collateral Agent’s security interest in such Patent, Trademark
or Copyright, and each Grantor hereby appoints the Collateral Agent as its
attorney-in-fact to execute and file such writings as are reasonably necessary
for the foregoing purposes, all acts of such attorney being hereby ratified and
confirmed; such power, being coupled with an interest, is irrevocable until such
time as when the Total Commitment has terminated and the Loans and Notes (in
each case together with interest thereon), Fees and all other Obligations (other
than indemnities described in Section 7.03 and in the other provisions of the
Credit Documents which are not then due and payable) incurred hereunder and
under the other Credit Documents are paid in full.

(f) Each Grantor will take all commercially reasonably necessary steps that it
may deem necessary or appropriate in its good faith business judgment in any
proceeding before the United States Patent and Trademark Office, United States
Copyright Office or any other

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Intellectual Property office or agency in any political subdivision of the
United States, to maintain each issued Patent and each registration of the
Trademarks and Copyrights and pursue each registration or application, in each
case, that is material to the conduct of the Grantors’ business (taken as a
whole) for Patents, Trademarks and/or Copyrights owned by such Grantor (and to
obtain the relevant grant or registration), including timely filings of
applications for renewal, affidavits of use, affidavits of incontestability and
payment of maintenance fees, and, if deemed necessary or appropriate in such
Grantor’s good faith business judgment, to initiate opposition, interference and
cancellation proceedings against third parties; provided, that nothing in this
Agreement shall prevent such Grantor from not pursuing or maintaining such an
application or registration if (i) such Grantor determines in its good faith
business judgment that such discontinuance is desirable in the conduct of its
business and (ii) such discontinuance will not result in a Material Adverse
Effect.

(g) In the event that any Grantor knows that any Article 9 Collateral consisting
of a Patent, Trademark or Copyright owned by such Grantor and material to the
conduct of the Grantors’ business (taken as a whole) has been materially
infringed, misappropriated or diluted by a third party, such Grantor promptly
shall notify the Collateral Agent and shall, if consistent such Grantor’s with
good faith business judgment, promptly sue for infringement, misappropriation or
dilution and to recover any and all damages for such infringement,
misappropriation or dilution (and take any actions required by applicable law
prior to instituting such suit), and take such other actions it deems
appropriate under the circumstances to protect such Article 9 Collateral.
Nothing in this Agreement shall prevent any Grantor from discontinuing the use
or maintenance of any Article 9 Collateral consisting of a Patent, Trademark or
Copyright, or require any Grantor to pursue any claim of infringement,
misappropriation or dilution, if (x) such Grantor so determines in its good
faith business judgment or (y) it is not prohibited by the Credit Agreement.

(h) Upon of an Event of Default that is continuing, each Grantor shall, at the
reasonable request of the Collateral Agent, use its commercially reasonable
efforts to obtain all requisite consents or approvals by the licensor of each
Copyright License, Patent License or Trademark License to effect the assignment
of all such Grantor’s right, title and interest thereunder to the Collateral
Agent or its designee.

(i) Each Grantor shall, upon Collateral Agent’s reasonable request, register its
material Licenses in such jurisdictions requiring such registration. If
permitted in a relevant jurisdiction, a Grantor may execute a “short form”
version of each such License as is necessary to effect the foregoing
registration in such jurisdiction.

Section 4.06. Cash Management System and Securities Accounts.

(a) Deposit Accounts. As of the date hereof each Grantor has neither opened nor
maintains any Deposit Accounts other than Excluded Accounts and the accounts
listed on Schedule V. From and after the date occurring 60 days from the date
hereof, or in the case of any Deposit Account which was an Excluded Account but
ceases to constitute same, 30 days after such cessation, or in each case, such
longer period as is acceptable to the Collateral Agent, each Grantor shall use
commercially reasonable efforts to cause each of such Deposit Accounts

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to be subject to the terms of a fully executed Deposit Account Control
Agreement. Each applicable Grantor will give prompt notice to the Collateral
Agent upon establishing a new Deposit Account with a bank. Such Grantor shall
use commercially reasonable efforts to, within 30 days after the establishment
or maintenance of any Deposit Account referred to in the preceding sentence (or
such longer period as is agreed by the Collateral Agent), such bank and such
Grantor shall duly execute and deliver to the Collateral Agent a Deposit Account
Control Agreement with respect to such Deposit Account. The Collateral Agent
agrees with each Grantor that the Collateral Agent shall not give any
instructions directing the disposition of funds from time to time credited to
any Deposit Account or withhold any withdrawal rights from such Grantor with
respect to funds from time to time credited to any Deposit Account or give any
notice of sale or exclusive control over any Deposit Accounts except upon the
occurrence of an Event of Default that is continuing. No Grantor shall grant
Control of any Deposit Account to any person other than the Collateral Agent.
The provisions of this Section 4.06 shall not apply to (1) any Deposit Accounts
for which the Collateral Agent is the Bank, (2) any Deposit Accounts (and the
cash and Cash Equivalents therein) specifically and exclusively used for
(x) payroll, payroll taxes, and other employee wage and benefit payments to or
for the benefit of any Grantor’s employees and accrued and unpaid employee
compensation (including salaries, wages, benefits and expense reimbursements),
(y) all taxes required to be collected or withheld (including, without
limitation, federal and state withholding taxes (including the employer’s share
thereof), taxes owing to any governmental unit thereof, sales, use and excise
taxes, customs duties, import duties and independent customs brokers’ charges),
and other taxes for which any Grantor may become liable or (z) accounts used as
collateral to satisfy potential obligations permitted by Section 8.01(l) of the
Credit Agreement and (3) any Deposit Accounts which individually, or in the
aggregate, do not have more than $50,000 on deposit therein for any period of
more than five Business Days (each an “Excluded Account”).

(b) Securities Accounts. As of the date hereof each Grantor has no Securities
Accounts other than those listed in Schedule VI or any accounts used as
collateral to satisfy potential obligations permitted by Section 8.01(l) of the
Credit Agreement. From and after the date occurring 60 days from the date hereof
(or such longer period as is acceptable to the Collateral Agent), such Grantor
shall make commercially reasonable efforts to give the Collateral Agent a
perfected first priority security interest in such Securities Accounts by
Control. Each applicable Grantor will give prompt notice to the Collateral Agent
upon establishing a new Securities Account with any Securities Intermediary.
Except with respect to accounts of the type described in clause (v) of the last
paragraph of Section 4.01(a) or any accounts used as collateral to satisfy
potential obligations permitted by Section 8.01(l) of the Credit Agreement,
within 30 days after the establishment or maintenance of any Securities Account
referred to in the preceding sentence (or such longer period as is agreed by the
Collateral Agent), such Grantor shall use commercially reasonable efforts to
cause such Securities Intermediary and such Grantor shall duly execute and
deliver to the Collateral Agent a Control Agreement with respect to such
Securities Account. Each Grantor shall (i) accept any uncertificated Investment
Property (other than Excess Exempted Foreign Entity Voting Equity Interests) in
trust for the benefit of the Collateral Agent and (ii) from and after the 60th
day following the Closing Date (or, if the requirements set forth in the second
sentence of Section 4.01(a) above have been satisfied prior to such date, such
earlier date), deposit within five (5) Business Days of actual receipt thereof
any and all cash and Investment Property (other than (x) cash deposited into a
Deposit Account of the type described in clause (2) or (3) of the

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penultimate sentence of Section 4.06(a), (y) any Investment Property pledged and
delivered to the Collateral Agent pursuant to Section 3.02 and (z) any Excess
Exempted Foreign Entity Voting Equity Interest) received by it into a Deposit
Account or Securities Account subject to Collateral Agent’s Control. The
Collateral Agent agrees with each Grantor that the Collateral Agent shall not
give any Entitlement Orders or instructions or directions to any issuer of
uncertificated securities or Securities Intermediary, and shall not withhold its
consent to the exercise of any withdrawal or dealing rights by such Grantor,
unless an Event of Default has occurred and is continuing or, after giving
effect to any such investment and withdrawal rights, would occur. No Grantor
shall grant control over any Investment Property to any Person other than the
Collateral Agent.

Section 4.07. Certain Uncertificated Securities. In the event that any of the
Pledged Collateral consists of limited liability company interests or
partnership interests that are uncertificated securities for the purposes of the
UCC, then the respective Grantor that owns such Pledged Collateral shall cause
(or, in the case of any issuer which is not a Subsidiary of such Grantor, use
commercially reasonable efforts to cause) the issuer thereof to duly authorize,
execute and deliver to the Collateral Agent an agreement for the benefit of the
Collateral Agent and the other Secured Creditors substantially in the form of
Exhibit VII hereto.

ARTICLE V

Remedies

Section 5.01. Remedies upon Default. Upon the occurrence of an Event of Default
that is continuing, each Grantor agrees to deliver each item of Collateral to
the Collateral Agent on demand, and it is agreed that the Collateral Agent shall
have the right to take any of or all the following actions at the same or
different times: (a) with respect to any Article 9 Collateral consisting of
Intellectual Property, on demand, to cause the Security Interest to become an
assignment, transfer and conveyance of any of or all such Article 9 Collateral
by the applicable Grantors to the Collateral Agent, for the ratable benefit of
the Secured Creditors, or to license or sublicense, whether general, special or
otherwise, and whether on an exclusive or nonexclusive basis, any such Article 9
Collateral throughout the world on such terms and conditions and in such manner
as the Collateral Agent shall determine (other than in violation of any
then-existing licensing arrangements to the extent that waivers cannot be
obtained), and (b) with or without legal process and with or without prior
notice or demand for performance, to take possession of the Article 9 Collateral
and without liability for trespass to enter any premises where the Article 9
Collateral may be located for the purpose of taking possession of or removing
the Article 9 Collateral and, generally, to exercise any and all rights afforded
to a secured party under the UCC or other applicable law. Without limiting the
generality of the foregoing, each Grantor agrees that the Collateral Agent shall
have the right, subject to the mandatory requirements of applicable law, to sell
or otherwise dispose of all or any part of the Collateral at a public or private
sale or at any broker’s board or on any securities exchange, for cash, upon
credit or for future delivery as the Collateral Agent shall deem appropriate.
Each such purchaser at any sale of Collateral shall hold the property sold
absolutely, free from any claim or right on the part of any Grantor, and each
Grantor hereby waives (to the extent permitted by law) all rights of redemption,
stay and appraisal that such Grantor now has or may at any time in the future
have under any rule of law or statute now existing or hereafter enacted.

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The Collateral Agent shall give the applicable Grantors 10 days’ written notice
(which each Grantor agrees is reasonable notice within the meaning of
Section 9-611 of the New York UCC or its equivalent in other jurisdictions) of
the Collateral Agent’s intention to make any sale of Collateral. Such notice, in
the case of a public sale, shall state the time and place for such sale and, in
the case of a sale at a broker’s board or on a securities exchange, shall state
the board or exchange at which such sale is to be made and the day on which the
Collateral, or portion thereof, will first be offered for sale at such board or
exchange. Any such public sale shall be held at such time or times within
ordinary business hours and at such place or places as the Collateral Agent may
fix and state in the notice (if any) of such sale. At any such sale, the
Collateral, or portion thereof, to be sold may be sold in one lot as an entirety
or in separate parcels, as the Collateral Agent may determine in its sole and
absolute discretion. The Collateral Agent shall not be obligated to make any
sale of any Collateral if it shall determine not to do so, regardless of the
fact that notice of sale of such Collateral shall have been given. The
Collateral Agent may, without notice or publication, adjourn any public or
private sale or cause the same to be adjourned from time to time by announcement
at the time and place fixed for sale, and such sale may, without further notice,
be made at the time and place to which the same was so adjourned. In case any
sale of all or any part of the Collateral is made on credit or for future
delivery, the Collateral so sold may be retained by the Collateral Agent until
the sale price is paid by the purchaser or purchasers thereof, but the
Collateral Agent and the other Secured Creditors shall not incur any liability
in case any such purchaser or purchasers shall fail to take up and pay for the
Collateral so sold and, in case of any such failure, such Collateral may be sold
again upon like notice. At any public (or, to the extent permitted by law,
private) sale made pursuant to this Agreement, any Secured Creditor may bid for
or purchase, free (to the extent permitted by law) from any right of redemption,
stay, valuation or appraisal on the part of any Grantor (all said rights being
also hereby waived and released to the extent permitted by law), the Collateral
or any part thereof offered for sale and may make payment on account thereof by
using any claim then due and payable to such Secured Creditor from any Grantor
as a credit against the purchase price, and such Secured Creditor may, upon
compliance with the terms of sale, hold, retain and dispose of such property
without further accountability to any Grantor therefor. For purposes hereof, a
written agreement to purchase the Collateral or any portion thereof shall be
treated as a sale thereof; the Collateral Agent shall be free to carry out such
sale pursuant to such agreement and no Grantor shall be entitled to the return
of the Collateral or any portion thereof subject thereto, notwithstanding the
fact that after the Collateral Agent shall have entered into such an agreement,
all Events of Default shall have been remedied and the Obligations paid in full.
As an alternative to exercising the power of sale herein conferred upon it, the
Collateral Agent may proceed by a suit or suits at law or in equity to foreclose
this Agreement and to sell the Collateral or any portion thereof pursuant to a
judgment or decree of a court or courts having competent jurisdiction or
pursuant to a proceeding by a court-appointed receiver. Any sale pursuant to the
provisions of this Section 5.01 shall be deemed to conform to the commercially
reasonable standards as provided in Section 9-610(b) of the New York UCC or its
equivalent in other jurisdictions.

Section 5.02. Application of Proceeds. (a) The Collateral Agent shall apply the
proceeds of any collection or sale of Collateral pursuant to this Article V,
including any Collateral consisting of cash, as follows:

FIRST, to the payment of all costs and expenses incurred by, and all indemnity
and fee obligations owed to, the Collateral Agent and the Administrative Agent
in connection with such collection or sale or otherwise in connection with, or
pursuant to, this Agreement, any other Credit Document or any of the
Obligations, including all court costs and the fees and expenses of its agents
and legal counsel, the repayment of all advances made by the Collateral Agent
hereunder or under any other Credit Document on behalf of any Grantor and any
other costs or expenses incurred in connection with the exercise of any right or
remedy hereunder or under any other Credit Document;

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SECOND, to the extent proceeds remain after the application pursuant to the
preceding clause FIRST, an amount equal to the outstanding Primary Obligations
(as hereinafter defined) shall be paid to the Secured Creditors as provided in
Section 5.02(d) hereof, with each Secured Creditor receiving an amount equal to
its outstanding Primary Obligations or, if the proceeds are insufficient to pay
in full all such Primary Obligations, its Pro Rata Share (as hereafter defined)
of the amount remaining to be distributed;

THIRD, to the extent proceeds remain after the application pursuant to the
preceding clauses FIRST and SECOND, inclusive, an amount equal to the
outstanding Secondary Obligations (as hereinafter defined) shall be paid to the
Secured Creditors as provided in Section 5.02(d) hereof, with each Secured
Creditor receiving an amount equal to its outstanding Secondary Obligations or,
if the proceeds are insufficient to pay in full all such Secondary Obligations,
its Pro Rata Share of the amount remaining to be distributed; and

FOURTH, to the extent proceeds remain after the application pursuant to the
preceding clauses FIRST through THIRD, inclusive, and following the termination
of the security interests created pursuant to this Agreement in accordance with
the express provisions of Section 7.13(a) hereof, to the relevant GRANTOR or to
whomever may be lawfully entitled to receive such surplus.

(b) For purposes of this Agreement, (x) “Pro Rata Share” shall mean, when
calculating a Secured Creditor’s portion of any distribution or amount, that
amount (expressed as a percentage) equal to a fraction the numerator of which is
the then unpaid amount of such Secured Creditor’s Primary Obligations or
Secondary Obligations, as the case may be, and the denominator of which is the
then outstanding amount of all Primary Obligations or Secondary Obligations, as
the case may be, (y) “Primary Obligations” shall mean (i) in the case of the
Credit Document Obligations, all principal of, premium, fees and interest on,
all Loans and all regularly accruing fees payable under the Credit Agreement and
(ii) in the case of the Obligations under or with respect to Interest Rate
Protection Agreements and the Other Hedging Agreements, all amounts due under
each Interest Rate Protection Agreement or Other Hedging Agreement to a Secured
Creditor (other than indemnities, fees (including, without limitation,
attorneys’ fees) and similar obligations and liabilities) and (z) “Secondary
Obligations” shall mean all Obligations other than Primary Obligations.

(c) When payments to Secured Creditors are based upon their respective Pro Rata
Shares, the amounts received by such Secured Creditors hereunder shall be
applied (for purposes of making determinations under this Section 5.02 only)
(i) first, to their Primary Obligations and (ii) second, to their Secondary
Obligations.

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(d) All payments required to be made hereunder shall be made (x) if to the
Lenders, to the Administrative Agent for the account of the Lenders and (y) if
to any Secured Creditor in respect of an Interest Rate Protection Agreement or
Other Hedging Agreement, to the trustee, paying agent or other similar
representative (each, a “Representative”) for such Secured Creditor or, in the
absence of such a Representative, directly to the relevant Secured Creditor.

(e) For purposes of applying payments received in accordance with this
Section 5.02, the Collateral Agent shall be entitled to rely upon (i) the
Administrative Agent and (ii) the Representative or, in the absence of such a
Representative, upon the respective Secured Creditors for a determination (which
the Administrative Agent, each Representative and the respective Secured
Creditors agree (or shall agree) to provide upon request of the Collateral
Agent) of the outstanding Primary Obligations and Secondary Obligations owed to
the Lenders or the other Secured Creditors, as the case may be. Unless it has
received written notice from a Lender or another Secured Creditor to the
contrary, the Administrative Agent and each Representative, in furnishing
information pursuant to the preceding sentence, and the Collateral Agent, in
acting hereunder, shall be entitled to assume that no Secondary Obligations are
outstanding. Unless it has written notice from a Secured Creditor to the
contrary, the Collateral Agent, in acting hereunder, shall be entitled to assume
that no Interest Rate Protection Agreements or Other Hedging Agreements secured
hereunder are in existence.

(f) It is understood that the Grantors shall remain jointly and severally liable
to the extent of any deficiency between the amount of the proceeds of the
Collateral and the aggregate amount of the Obligations.

The Collateral Agent shall have sole and absolute discretion as to the time of
application of any such proceeds, moneys or balances in accordance with Article
V of this Agreement. Upon any sale of Collateral by the Collateral Agent
(including pursuant to a power of sale granted by statute or under a judicial
proceeding), the receipt of the Collateral Agent or of the officer making the
sale shall be a sufficient discharge to the purchaser or purchasers of the
Collateral so sold and such purchaser or purchasers shall not be obligated to
see to the application of any part of the purchase money paid over to the
Collateral Agent or such officer or be answerable in any way for the
misapplication thereof.

Section 5.03. Grant of License To Use Intellectual Property. For the purpose of
enabling the Collateral Agent to exercise rights and remedies under this
Agreement at such time as the Collateral Agent shall be lawfully entitled to
exercise such rights and remedies, each Grantor hereby grants to (in the
Collateral Agent’s sole discretion) a designee of the Collateral Agent or the
Collateral Agent an irrevocable (except as otherwise provided herein),
nonexclusive license (exercisable without payment of royalty or other
compensation to the Grantors) to use, license or sublicense (in each case to the
extent of such Grantor’s rights therein and to the extent permitted by
then-existing license or other agreements relating thereto) any of the Article 9
Collateral consisting of Intellectual Property now owned or hereafter acquired
by such Grantor, and wherever the same may be located, and including in such
license reasonable access to all media in which any of the licensed items may be
recorded or stored and to all computer software

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and programs used for the compilation or printout thereof; provided that such
license shall be revocable after such time as when the Total Commitment has
terminated and the Loans and Notes (in each case together with interest
thereon), Fees and all other Obligations (other than indemnities described in
Section 7.03 and the other provisions of the Credit Documents which are not then
due and payable) incurred hereunder and thereunder, are paid in full. The use of
such license by the Collateral Agent shall be exercised, at the option of the
Collateral Agent, only upon the occurrence of an Event of Default that is
continuing, provided that any license, sublicense or other transaction entered
into in good faith by the Collateral Agent in accordance herewith shall be
binding upon the Grantors notwithstanding any subsequent cure of an Event of
Default.

Section 5.04. Securities Act. In view of the position of the Grantors in
relation to the Pledged Stock, or because of other current or future
circumstances, a question may arise under the Securities Act of 1933, as now or
hereafter in effect, or any similar statute hereafter enacted analogous in
purpose or effect (such Act and any such similar statute as from time to time in
effect being called the “Federal Securities Laws”) with respect to any
disposition of the Pledged Stock permitted hereunder. Each Grantor understands
that compliance with the Federal Securities Laws might very strictly limit the
course of conduct of the Collateral Agent if the Collateral Agent were to
attempt to dispose of all or any part of the Pledged Stock, and might also limit
the extent to which or the manner in which any subsequent transferee of any
Pledged Stock could dispose of the same. Similarly, there may be other legal
restrictions or limitations affecting the Collateral Agent in any attempt to
dispose of all or part of the Pledged Stock under applicable “Blue Sky” or other
state securities laws or similar laws analogous in purpose or effect. Each
Grantor recognizes that in light of such restrictions and limitations the
Collateral Agent may, with respect to any sale of the Pledged Stock, limit the
purchasers to those who will agree, among other things, to acquire such Pledged
Stock for their own account, for investment, and not with a view to the
distribution or resale thereof. Each Grantor acknowledges and agrees that in
light of such restrictions and limitations, the Collateral Agent, in its sole
and absolute discretion (a) may proceed to make such a sale whether or not a
registration statement for the purpose of registering such Pledged Stock or part
thereof shall have been filed under the Federal Securities Laws and (b) may
approach and negotiate with a single potential purchaser to effect such sale.
Each Grantor acknowledges and agrees that any such sale might result in prices
and other terms less favorable to the seller than if such sale were a public
sale without such restrictions. In the event of any such sale, the Collateral
Agent shall incur no responsibility or liability for selling all or any part of
the Pledged Stock at a price that the Collateral Agent, in its sole and absolute
discretion, may in good faith deem reasonable under the circumstances,
notwithstanding the possibility that a substantially higher price might have
been realized if the sale were deferred until after registration as aforesaid or
if more than a single purchaser were approached.

ARTICLE VI

Indemnity, Subrogation and Subordination

Section 6.01. Indemnity and Subrogation. In addition to all rights of indemnity
and subrogation as the Guarantors may have under applicable law (but in each
case subject to Section 6.03), the Borrower agrees that (a) in the event a
payment of any Obligation shall be

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made by any Guarantor under this Agreement, the Borrower shall indemnify such
Guarantor for the full amount of such payment and such Guarantor shall be
subrogated to the rights of the Person to whom such payment shall have been made
to the extent of such payment and (b) in the event any assets of any Grantor
shall be sold pursuant to this Agreement or any other Security Document to
satisfy in whole or in part any Obligation owed to any Secured Creditor, the
Borrower shall indemnify such Grantor in an amount equal to the fair value of
the assets so sold.

Section 6.02. Contribution and Subrogation. Each Guarantor and Grantor other
than the Borrower (each a “Contributing Party”) agrees (subject to Section 6.03)
that to the extent that a Guarantor shall have paid more than its proportionate
share (based, to the maximum extent permitted by law, on the respective Adjusted
Net Worths of the Guarantors on the date the respective payment is made) of any
payment made hereunder (whether as Guarantor and/or Grantor hereunder, with
proceeds of the Collateral of any Grantor applied hereunder deemed for this
purpose to be payments made by it), such Guarantor shall be entitled to seek and
receive contribution from and against any other Guarantor hereunder that has not
paid its proportionate share of such payment. Each Guarantor’s right of
contribution shall be subject to the terms and conditions of Section 6.03.
Notwithstanding anything to the contrary contained above, any Guarantor that is
released from this Agreement (and its guarantees contained herein) in accordance
with the express provisions of Section 7.13(b) shall thereafter have no
contribution obligations, or rights, pursuant to this Section 6.02, and at the
time of any such release, the contribution rights and obligations of the
remaining Guarantors shall be recalculated on the respective date of release (as
otherwise provided herein) based on the payments made hereunder by the remaining
Guarantors. The provisions of this Section 6.02 shall in no respect limit the
obligations and liabilities of any Guarantor or Grantor to the Collateral Agent
and the other Secured Creditors, and each Guarantor shall remain liable to the
Collateral Agent and the other Secured Creditors for the full amount guaranteed
by such Guarantor hereunder.

Section 6.03. Subordination. Notwithstanding any provision in this Agreement to
the contrary, all rights of the Guarantors and Grantors under Sections 6.01 and
6.02 and all other rights of indemnity, contribution or subrogation under
applicable law or otherwise shall be fully subordinated to the indefeasible
payment in full in cash of the Obligations, and no Credit Party shall be
entitled to be subrogated to any of the rights of the Collateral Agent or any
other Secured Creditor against the Borrower or any other Credit Party or any
collateral security or guaranty or right of offset held by the Collateral Agent
or any other Secured Creditor for the payment of any of the Obligations, nor
shall any Credit Party seek or be entitled to seek any contribution or
reimbursement from the Borrower or any other Credit Party in respect of payments
made by such Credit Party hereunder (or paid with proceeds of collateral of such
Credit Party hereunder), whether contractual, under Section 509 of the
Bankruptcy Code or otherwise, until all amounts owing to the Collateral Agent
and the other Secured Creditors on account of the Obligations are paid in full
in cash and the Total Commitment has been terminated. If any amount shall be
paid to any Credit Party on account of such contribution or subrogation rights
at any time when all of the Obligations shall not have been paid in full in cash
or any of the Commitments shall remain in effect, such amount shall be held by
such Credit Party in trust for the Collateral Agent and the other Secured
Creditors, segregated from other funds of such Credit Party, and shall,
forthwith upon receipt by such Credit Party, be turned over to the Collateral
Agent in the exact form received by such Credit Party (duly indorsed by such
Credit Party to the Collateral Agent, if required), to be held as collateral
security for all of the Obligations (whether matured or

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unmatured) of, or guaranteed by, such Credit Party and/or then or at any time
thereafter may be applied against any Obligations, whether matured or unmatured,
in such order as the Collateral Agent may determine.

ARTICLE VII

Miscellaneous

Section 7.01. Notices. All communications and notices hereunder shall (except as
otherwise expressly permitted in this Agreement) be in writing and given as
provided in Section 11.03 of the Credit Agreement, provided that any
communication or notice hereunder from the Collateral Agent to any Credit Party
upon the occurrence of an Event of Default that is continuing may be given by
telephone if promptly confirmed in writing. All communications and notices
hereunder to any Guarantor shall be given to it in care of the Borrower as
provided in Section 11.03 of the Credit Agreement.

Section 7.02. Waivers; Amendment. (a) No failure or delay by any Secured
Creditor in exercising any right or power hereunder or under any other Credit
Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of
the Secured Creditors hereunder and under the other Credit Documents are
cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No waiver of any provision in this Agreement or consent to any
departure by any Credit Party therefrom shall in any event be effective unless
the same shall have been effected in accordance with paragraph (b) of this
Section 7.02, and then such waiver or consent shall be effective only in the
specific instance and for the purpose for which given. Without limiting the
generality of the foregoing, the making of a Loan shall not be construed as a
waiver of any Default or Event of Default, regardless of whether any Secured
Creditor may have had notice or knowledge of such Default or Event of Default at
the time. No notice or demand on any Credit Party in any case shall entitle any
Credit Party to any other or further notice or demand in similar or other
circumstances.

(b) Neither this Agreement nor any provision hereof may be waived, amended or
modified except pursuant to an agreement or agreements in writing entered into
by the Collateral Agent and the Credit Party or Credit Parties with respect to
which such waiver, amendment or modification is to apply, subject to any consent
required in accordance with Section 11.12 of the Credit Agreement.

Section 7.03. Collateral Agent’s Fees and Expenses; Indemnification. (a) The
parties hereto agree that the Collateral Agent shall be entitled to
reimbursement of its reasonable out-of-pocket expenses incurred hereunder as
provided in Section 11.01 of the Credit Agreement.

(b) Without limitation of its indemnification obligations under the other Credit
Documents, each Grantor and each Guarantor jointly and severally agrees to
indemnify the Collateral Agent, each other Secured Creditor and their respective
successors, assigns,

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employees, affiliates and agents (hereinafter in this Section 7.03 referred to
individually as “Indemnitee”) against, and hold each Indemnitee harmless from,
any and all losses, claims, damages, liabilities and related out-of-pocket
expenses, including the fees, charges and disbursements of any external counsel
for any Indemnitee, incurred by or asserted against any Indemnitee arising out
of, in connection with, or as a result of, the execution, delivery or
performance of this Agreement or any actual or prospective claim, litigation,
investigation or proceeding relating to any of the foregoing agreements or
instruments contemplated hereby, or to the Collateral, whether or not any
Indemnitee is a party thereto; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such losses, claims, damages,
liabilities and related out-of-pocket expenses have resulted from the
Indemnitee’s (or such affiliate’s) bad faith, gross negligence, willful
misconduct or breach of its obligations under this Agreement (in each case, as
determined by a court of competent jurisdiction in a final and non-appealable
decision).

(c) Any such amounts payable as provided hereunder shall be additional
Obligations secured hereby and by the other Security Documents. The provisions
of this Section 7.03 shall remain operative and in full force and effect
regardless of the termination of this Agreement or any other Credit Document,
the consummation of the transactions contemplated hereby, the repayment of any
of the Obligations, the invalidity or unenforceability of any term or provision
of this Agreement or any other Credit Document, or any investigation made by or
on behalf of the Collateral Agent or any other Secured Creditor. All amounts due
under this Section 7.03 shall be payable within 15 days after written demand
therefor.

Section 7.04. Successors and Assigns. Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the
permitted successors and assigns of such party; and all covenants, promises and
agreements by or on behalf of any Guarantor, Grantor or the Collateral Agent
that are contained in this Agreement shall bind and inure to the benefit of
their respective successors and assigns and shall inure to the benefit of the
other Secured Creditors and their respective successors and assigns.

Section 7.05. Survival of Agreement. All covenants, agreements, representations
and warranties made by the Credit Parties in the Credit Documents and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Credit Document shall be considered to
have been relied upon by the Lenders and shall survive the execution and
delivery of the Credit Documents and the making of any Loans, regardless of any
investigation made by any Lender or on its behalf and notwithstanding that the
Administrative Agent, the Collateral Agent or any Lender may have had notice or
knowledge of any Default or incorrect representation or warranty at the time any
credit is extended under the Credit Agreement, and shall continue in full force
and effect as long as the principal of or any accrued interest on any Loan or
any fee or any other amount payable under any Credit Document is outstanding and
unpaid and so long as the Commitments have not expired or terminated.

Section 7.06. Counterparts; Effectiveness; Several Agreement. This Agreement may
be executed in any number of counterparts and by the different parties hereto on
separate counterparts, each of which when so executed and delivered shall be an
original, but all of which shall together constitute one and the same
instrument. A set of counterparts executed by all the parties hereto shall be
lodged with the Borrower and the Administrative Agent. Delivery of an

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executed counterpart hereof by facsimile or electronic transmission shall be as
effective as delivery of any original executed counterpart hereof. This
Agreement shall become effective as to any Credit Party when a counterpart
hereof executed on behalf of such Credit Party shall have been delivered to the
Collateral Agent and a counterpart hereof shall have been executed on behalf of
the Collateral Agent, and thereafter shall be binding upon such Credit Party and
the Collateral Agent and their respective permitted successors and assigns, and
shall inure to the benefit of such Credit Party, the Administrative Agent, the
Collateral Agent and the other Secured Creditors and their respective successors
and assigns, except that no Credit Party shall have the right to assign or
transfer its rights or obligations hereunder or any interest in this Agreement
or in the Collateral (and any such assignment or transfer shall be void) except
as contemplated by this Agreement or the Credit Agreement. This Agreement shall
be construed as a separate agreement with respect to each Credit Party and may
be amended, modified, supplemented, waived or released with respect to any
Credit Party without the approval of any other Credit Party and without
affecting the obligations of any other Credit Party hereunder.

Section 7.07. Severability. Any provision in this Agreement held to be invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof; the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other jurisdiction. The
parties shall endeavor in good-faith negotiations to replace the invalid,
illegal or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.

Section 7.08. Right of Set-Off. If an Event of Default shall have occurred and
be continuing, each Lender and each of its Affiliates is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held (other than Deposit Accounts excluded
from the Collateral pursuant to the last paragraph of Section 4.01(a)) and other
obligations at any time owing by such Lender or Affiliate to or for the credit
or the account of any Credit Party against any of and all the obligations of
such Credit Party now or hereafter existing under this Agreement owed to such
Lender, irrespective of whether or not such Lender shall have made any demand
under this Agreement and although such obligations may be unmatured. The
applicable Lender shall notify the Borrower, the Collateral Agent and the
Administrative Agent of such set-off or application, provided that any failure
to give or any delay in giving such notice shall not affect the validity of any
such set-off or application under this Section 7.08. The rights of each Lender
under this Section 7.08 are in addition to other rights and remedies (including
other rights of set-off) which such Lender may have.

Section 7.09. Governing Law; Jurisdiction; Consent to Service of Process.
(a) This Agreement shall be construed in accordance with and governed by the law
of the State of New York.

(b) Each of the parties hereto hereby irrevocably and unconditionally submits,
for itself and its property, to the nonexclusive jurisdiction of the Supreme
Court of the State of New York sitting in New York County and of the United
States District Court of the Southern District of New York, and any appellate
court from any thereof, in any action or proceeding

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arising out of or relating to this Agreement or any other Credit Document, or
for recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such New York State or,
to the extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement or any other
Credit Document shall affect any right that the Collateral Agent, any Lender or
any Credit Party may otherwise have to bring any action or proceeding relating
to this Agreement or any other Credit Document in the courts of any
jurisdiction.

(c) Each of the parties hereto hereby irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection that it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement or any other Credit
Document in any court referred to in paragraph (b) of this Section 7.09. Each of
the parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.

(d) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 7.01. Nothing in this Agreement or
any other Credit Document will affect the right of any party to this Agreement
to serve process in any other manner permitted by law.

Section 7.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT, ANY OTHER CREDIT DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY 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
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION 7.10.

Section 7.11. Headings. Article and Section headings and the Table of Contents
used in this Agreement are for convenience of reference only, are not part of
this Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.

Section 7.12. Liabilities of Guarantors and Security Interest Absolute. All
rights of the Collateral Agent hereunder, the Security Interest, the grant of a
security interest in the Pledged Collateral and all obligations of each Grantor
and Guarantor hereunder shall be absolute and unconditional irrespective of
(a) any lack of validity or enforceability of, or rescission or

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irregularity of, the Credit Agreement, any other Credit Document, any agreement
with respect to any of the Obligations or any other agreement or instrument
relating to any of the foregoing, (b) any change in the time, manner or place of
payment of, or in any other term of, all or any of the Obligations, or any other
amendment or waiver of or any consent to any departure from the Credit
Agreement, any other Credit Document or any other agreement or instrument, in
each case, in accordance with their respective terms, (c) any exchange, release
or non-perfection of any Lien on other collateral, or any release or amendment
or waiver of or consent under or departure from any guaranty, securing or
guaranteeing all or any of the Obligations, (d) any direction as to application
of payment by the Borrower, or any other party, (e) any other continuing or
other guaranty, undertaking or maximum liability of a Grantor or Guarantor or of
any other party as to the Obligations, (f) any payment on or in reduction of any
such other guaranty or undertaking, (g) any dissolution, termination or
increase, decrease or change in personnel by the borrower, (h) the failure of
the Grantor or Guarantor to receive any benefit from or as a result of its
execution, delivery and performance of this Agreement, (f) any payment made to
any secured creditor on the Obligations which such secured creditor repays to
the borrower pursuant to court order in any bankruptcy, reorganization,
arrangement, moratorium or other debtor relief proceeding, and each guarantor
waives any right to the deferral or modification of its obligations hereunder by
reason of any such proceeding, (g) any action or inaction by the secured
creditors as contemplated in Section 2.02 or (h) any other circumstance that
might otherwise constitute a defense available to, or a discharge of, any
Grantor or Guarantor in respect of the Obligations or this Agreement (other than
a release of any Grantor or Guarantor in accordance with Section 7.13).

Section 7.13. Termination or Release. (a) The Security Interest and all other
security interests granted hereby shall be automatically released when all the
Credit Document Obligations (other than inchoate indemnity obligations) have
been indefeasibly paid in full and the Lenders have no further commitment to
lend under the Credit Agreement.

(b) A Subsidiary of the Borrower which was a Credit Party immediately prior to
the consummation of any transaction permitted by the Credit Agreement as a
result of which such Person ceases to be a Credit Party shall automatically be
released from its obligations hereunder and the Security Interest in the
Collateral of such Person shall be automatically released upon the consummation
of such transaction.

(c) Upon any sale or other transfer by any Grantor of any Collateral that is
permitted under the Credit Agreement to a Person other than the Borrower or a
Subsidiary thereof, or upon the effectiveness of any written consent to the
release of the security interest granted hereby in any Collateral pursuant to
Section 11.12 of the Credit Agreement, the security interest in such Collateral
shall be automatically released.

(d) In connection with any termination or release pursuant to paragraph (a),
(b) or (c) of this Section 7.13, the Collateral Agent shall execute and deliver
to any Person, at such Person’s expense, all documents that such Person shall
reasonably request to evidence such termination or release of its obligations or
the security interests in its Collateral. Any execution and delivery of
documents pursuant to this Section 7.13 shall be without recourse to or warranty
by the Collateral Agent.

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Section 7.14. Additional Subsidiaries. Pursuant to Section 8.14 of the Credit
Agreement, each Domestic Subsidiary of a Credit Party that was not in existence
or not a Subsidiary on the date of the Credit Agreement, is required to enter in
this Agreement as a Subsidiary Credit Party upon becoming such a Domestic
Subsidiary. Upon execution and delivery by the Collateral Agent and such
Subsidiary of an instrument in the form of Exhibit I hereto, such Subsidiary
shall become a Subsidiary Credit Party hereunder with the same force and effect
as if originally named as a Subsidiary Credit Party in this Agreement. The
execution and delivery of any such instrument shall not require the consent of
any other Credit Party hereunder. The rights and obligations of each Credit
Party hereunder shall remain in full force and effect notwithstanding the
addition of any new Credit Party as a party to this Agreement.

Section 7.15. Collateral Agent Appointed Attorney-in-Fact. Each Grantor hereby
appoints the Collateral Agent the attorney-in-fact of such Grantor for the
purpose of carrying out the provisions of this Agreement and taking any action
and executing any instrument that the Collateral Agent may deem necessary or
advisable to accomplish the purposes hereof upon the occurrence of of an Event
of Default that is continuing, which appointment is irrevocable (until the Total
Commitment has terminated and the Loans and Notes (in each case together with
interest thereon), Fees and all other Obligations (other than indemnities
described in Section 7.03 and the other provisions of the Credit Documents which
are not then due and payable) incurred hereunder and thereunder, are paid in
full) and coupled with an interest. Without limiting the generality of the
foregoing, the Collateral Agent shall have the right, upon the occurrence of an
Event of Default that is continuing, with full power of substitution either in
the Collateral Agent’s name or in the name of such Grantor (a) to receive,
endorse, assign and/or deliver any and all notes, acceptances, checks, drafts,
money orders or other evidences of payment relating to the Collateral or any
part thereof; (b) to demand, collect, receive payment of, give receipt for and
give discharges and releases of all or any of the Collateral; (c) to sign the
name of any Grantor on any invoice or bill of lading relating to any of the
Collateral; (d) to send verifications of Accounts to any Account Debtor; (e) to
commence and prosecute any and all suits, actions or proceedings at law or in
equity in any court of competent jurisdiction to collect or otherwise realize on
all or any of the Collateral or to enforce any rights in respect of any
Collateral; (f) to settle, compromise, compound, adjust or defend any actions,
suits or proceedings relating to all or any of the Collateral; (g) to notify, or
to require any Grantor to notify, Account Debtors to make payment directly to
the Collateral Agent; and (h) to use, sell, assign, transfer, pledge, make any
agreement with respect to or otherwise deal with all or any of the Collateral,
and to do all other acts and things necessary to carry out the purposes of this
Agreement, as fully and completely as though the Collateral Agent were the
absolute owner of the Collateral for all purposes, provided that nothing in this
Agreement contained shall be construed as requiring or obligating the Collateral
Agent to make any commitment or to make any inquiry as to the nature or
sufficiency of any payment received by the Collateral Agent, or to present or
file any claim or notice, or to take any action with respect to the Collateral
or any part thereof or the moneys due or to become due in respect thereof or any
property covered thereby. The Collateral Agent and the other Secured Creditors
shall be accountable only for amounts actually received as a result of the
exercise of the powers granted to them in this Agreement, and neither they nor
their officers, directors, employees or agents shall be responsible to any
Grantor for any act or failure to act hereunder, except for their own gross
negligence or willful misconduct (as determined by a court of competent
jurisdiction in a final and non-appealable decision).

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Section 7.16. Further Assurances. Notwithstanding anything to the contrary
herein, the parties hereto agree to comply with the requirements set forth in
Section 7.12 of the Credit Agreement.

Section 7.17. Collateral Agent. The Collateral Agent shall act in accordance
with the provisions of Section 10 of the Credit Agreement, the provisions of
which shall be deemed incorporated by reference herein as fully as if set forth
in their entirety herein. Each Secured Creditor, by accepting the benefits of
this Agreement, agrees to the provisions of Section 11 of the Credit Agreement,
including as same apply to the actions of the Collateral Agent hereunder.

[Signature Pages to Follow]

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IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of
the day and year first above written.

 

HUGHES TELEMATICS, INC. By:  

/s/ Craig Kaufmann

Name:   Craig Kaufmann Title:   VP Finance and Treasurer NETWORKCAR, INC. By:  

/s/ Craig Kaufmann

Name:   Craig Kaufmann Title:   Treasurer HTI IP, LLC By:  

/s/ Craig Kaufmann

Name:   Craig Kaufmann Title:   Treasurer

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MORGAN STANLEY & CO. INCORPORATED, as Collateral Agent By:  

/s/ Andrew W. Earls

Name:   Andrew Earls Title:   Managing Director

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SCHEDULE I

GUARANTY AND COLLATERAL AGREEMENT

GUARANTORS

Networkcar, Inc., a Delaware corporation

HTI IP, LLC, a Delaware limited liability company

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SCHEDULE II

GUARANTY AND COLLATERAL AGREEMENT

PLEDGED STOCK; PLEDGED DEBT

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SCHEDULE III

GUARANTY AND COLLATERAL AGREEMENT

INTELLECTUAL PROPERTY

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SCHEDULE IV

GUARANTY AND COLLATERAL AGREEMENT

COMMERCIAL TORT CLAIMS

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SCHEDULE V

GUARANTY AND COLLATERAL AGREEMENT

DEPOSIT ACCOUNTS

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SCHEDULE VI

GUARANTY AND COLLATERAL AGREEMENT

SECURITIES ACCOUNTS

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SCHEDULE VII

GUARANTY AND COLLATERAL AGREEMENT

SCHEDULE OF LEGAL NAMES, ETC.

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SCHEDULE VIII

GUARANTY AND COLLATERAL AGREEMENT

PERSONS HOLDING COLLATERAL, LOCATIONS OF COLLATERAL

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SCHEDULE IX

GUARANTY AND COLLATERAL AGREEMENT

FILING OFFICES