EXECUTION VERSION
 
SECURITY AGREEMENT
 
THIS SECURITY AGREEMENT (as amended, restated, supplemented or otherwise
modified from time to time, this “Agreement”) dated as of June 23, 2008 among
OPTIONS MEDIA GROUP HOLDINGS, INC., a Delaware corporation (the “Company”),
OPTIONS ACQUISITION SUB, INC. (“Options”, together with Company, and each other
Person who becomes a party to this Agreement by execution of a joinder in the
form of Exhibit A attached hereto, is hereinafter sometimes referred to
individually as a “Debtor” and, collectively, as the “Debtors”), and CUSTOMER
ACQUISITION NETWORK HOLDINGS, INC., a Delaware corporation (together with its
successors and assigns, the “Secured Party”).
 
W I T N E S S E T H:
 
WHEREAS, on the date hereof, pursuant to that certain merger agreement by and
among the Debtors and Options Acquisition Corp., dated June 23, 2008 (the
“Merger Agreement”), whereby the Company acquired Options.  Pursuant to the
terms of the Merger Agreement, the Company issued, and the Secured Party
acquired that certain senior secured promissory note in the principal amount of
$1,000,000.00 (such note, together with any promissory notes or other securities
issued in exchange or substitution therefor or replacement thereof, and as any
of the same may be amended, supplemented, restated or modified and in effect
from time to time, the “Note”);
 
WHEREAS, each Debtor (other than the Company) from time to time party hereto is
a direct or indirect subsidiary of the Company and, as such, will derive
substantial benefit and advantage from the financial accommodations to the
Company set forth in the Note, and it will be in each such Debtor’s direct
interest and economic benefit to assist the Company in procuring said financial
accommodations from the Secured Party; and
 
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
 
Section 1.  Definitions.
 
“Accounts” means any “account,” as such term is defined in the Uniform
Commercial Code, and, in any event, shall include, without limitation,
“supporting obligations” as defined in the Uniform Commercial Code.
 
“As-extracted Collateral” means any “as-extracted collateral,” as such term is
defined in the Uniform Commercial Code.
 
“Capital Lease Obligation” means, as to any Person, any obligation that is
required to be classified and accounted for as a capital lease on a balance
sheet of such Person prepared in accordance with GAAP, and the amount of such
obligation shall be the capitalized amount thereof, determined in accordance
with GAAP.
 
“Chattel Paper” means any “chattel paper,” as such term is defined in the
Uniform Commercial Code, including electronic chattel paper.
 

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“Collateral” shall have the meaning ascribed thereto in Section 3 hereof.
 
“Commercial Tort Claims” means “commercial tort claims”, as such term is defined
in the Uniform Commercial Code.
 
“Contracts” means all contracts, undertakings, or other agreements (other than
rights evidenced by Chattel Paper, Documents or Instruments) in or under which a
Debtor may now or hereafter have any right, title or interest, including,
without limitation, with respect to an Account, any agreement relating to the
terms of payment or the terms of performance thereof.
 
“Copyrights” means any copyrights, rights and interests in copyrights, works
protectable by copyrights, copyright registrations and copyright applications,
including, without limitation, the copyright registrations and applications
listed on Schedule III attached hereto (if any), and all renewals of any of the
foregoing, all income, royalties, damages and payments now and hereafter due
and/or payable under or with respect to any of the foregoing, including, without
limitation, damages and payments for past, present and future infringements of
any of the foregoing and the right to sue for past, present and future
infringements of any of the foregoing.
 
“Deposit Accounts” means all “deposit accounts” as such term is defined in the
Uniform Commercial Code, now or hereafter held in the name of a Debtor.
 
“Documents” means any “documents,” as such term is defined in the Uniform
Commercial Code, and shall include, without limitation, all documents of title
(as defined in the Uniform Commercial Code), bills of lading or other receipts
evidencing or representing Inventory or Equipment.
 
“Equipment” means any “equipment,” as such term is defined in the Uniform
Commercial Code and, in any event, shall include, Motor Vehicles.
 
“Event of Default” shall have the meaning set forth in the Note.
 
“Excluded Property” means any Contract, agreement, or Instrument entered into by
any Debtor that by its terms prohibits or requires the consent of any Peron
other than the Company and its Affiliates which has not been obtained as a
condition to the creation by such Debtor of a Lien on any right, title, or
interest in such Contract, agreement, or Instrument  to the extent, and for so
long as, such prohibition is not terminated or rendered unenforceable or
otherwise deemed ineffective by the Uniform Commercial Code, including, without
limitation, Sections 9-406, 9-407, 9-408, or 9-409 thereof, or any successor
provision or provisions or other applicable law.
 
“GAAP” means U.S. generally accepted accounting principles.
 
“General Intangibles” means any “general intangibles,” as such term is defined
in the Uniform Commercial Code, and, in any event, shall include, without
limitation, all right, title and interest in or under any Contract, models,
drawings, materials and records, claims, literary rights, goodwill, rights of
performance, Copyrights, Trademarks, Patents, warranties, rights under insurance
policies and rights of indemnification.
 
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“Goods” means any “goods”, as such term is defined in the Uniform Commercial
Code, including, without limitation, fixtures and embedded Software to the
extent included in “goods” as defined in the Uniform Commercial Code.
 
“Governmental Authority” means the government of the United States of America or
any other nation, or any political subdivision thereof, whether state or local,
or any agency, authority, instrumentality, regulatory body, court, central bank
or other entity exercising executive, legislative, judicial, taxing, regulatory
or administration powers or functions of or pertaining to government over any
Debtor or any of its Subsidiaries, or any of their respective properties, assets
or undertakings.
 
“Instruments” means any “instrument,” as such term is defined in the Uniform
Commercial Code, and shall include, without limitation, promissory notes,
drafts, bills of exchange, trade acceptances, letters of credit, letter of
credit rights (as defined in the Uniform Commercial Code), and Chattel Paper.
 
“Inventory” means any “inventory,” as such term is defined in the Uniform
Commercial Code.
 
“Investment Property” means any “investment property”, as such term is defined
in the Uniform Commercial Code.
 
“Liabilities” shall mean all obligations, liabilities and indebtedness of every
nature of Debtors from time to time owed or owing under or in respect of this
Agreement, the Note, any of the other Security Documents and any of the other
transaction documents, as the case may be, including, without limitation, the
principal amount of all debts, claims and indebtedness, accrued and unpaid
interest and all fees, costs and expenses, whether primary, secondary, direct,
contingent, fixed or otherwise, heretofore, now and/or from time to time
hereafter owing, due or payable whether before or after the filing of a
bankruptcy, insolvency or similar proceeding under applicable federal, state,
foreign or other law and whether or not an allowed claim in any such proceeding.
 
“Lien” shall mean with respect to any asset or property, any mortgage, lien,
pledge, hypothecation, charge, security interest, encumbrance or adverse claim
of any kind and any restrictive covenant, condition, restriction or exception of
any kind that has the practical effect of creating a mortgage, lien, pledge,
hypothecation, charge, security interest, encumbrance or adverse claim of any
kind (including any of the foregoing created by, arising under or evidenced by
any conditional sale or other title retention agreement, the interest of a
lessor with respect to a Capital Lease Obligation, or any financing lease having
substantially the same economic effect as any of the foregoing).
 
“Motor Vehicles” shall mean motor vehicles, tractors, trailers and other like
property, whether or not the title thereto is governed by a certificate of title
or ownership.
 
“Patents” means any patents and patent applications, including, without
limitation, the inventions and improvements described and claimed therein, all
patentable inventions and those patents and patent applications listed on
Schedule IV attached hereto (if any), and the reissues, divisions,
continuations, renewals, extensions and continuations-in-part of any of the
foregoing, and all income, royalties, damages and payments now or hereafter due
and/or payable under or with respect to any of the foregoing, including, without
limitation, damages and payments for past, present and
 
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                  future infringements of any of the foregoing and the right to
sue for past, present and future infringements of any of the foregoing.
 
“Permitted Lien” shall mean:
 
(i)           Liens created by this Agreement;
 
(ii)           Liens for taxes or other governmental charges not at the time due
and payable, or which are being contested in good faith by appropriate
proceedings diligently prosecuted, so long as foreclosure, distraint, sale or
other similar proceedings have not been initiated, and in each case for which
the Company and its Subsidiaries maintain adequate reserves in accordance with
GAAP in respect of such taxes and charges;
 
(iii)           Liens arising in the ordinary course of business in favor of
carriers, warehousemen, mechanics and materialmen, or other similar Liens
imposed by law, which remain payable without penalty or which are being
contested in good faith by appropriate proceedings diligently prosecuted, which
proceedings have the effect of preventing the forfeiture or sale of the property
subject thereto, and in each case for which adequate reserves in accordance with
GAAP are being maintained;
 
(iv)           Liens arising in the ordinary course of business in connection
with worker’s compensation, unemployment compensation and other types of social
security (excluding Liens arising under ERISA);
 
(v)           Attachments, appeal bonds (and cash collateral securing such
bonds), judgments and other similar Liens, for sums not exceeding $250,000 in
the aggregate for the Company and its Subsidiaries, arising in connection with
court proceedings, provided that the execution or other enforcement of such
Liens is effectively stayed;
 
(vi)           Easements, rights of way, restrictions, minor defects or
irregularities in title and other similar Liens arising in the ordinary course
of business and not materially detracting from the value of the property subject
thereto and not interfering in any material respect with the ordinary conduct of
the business of the Company or any of its Subsidiaries;
 
(vii)           Liens arising solely by virtue of any statutory or common law
provision relating to banker’s liens, rights of set-off or similar rights and
remedies and burdening only deposit accounts or other funds maintained with a
creditor depository institution, provided that no such deposit account is a
dedicated cash collateral account or is subject to restrictions against access
by the depositor in excess of those set forth by regulations promulgated by the
Board of Governors of the U.S. Federal Reserve System and that no such deposit
account is intended by the Company or any of its Subsidiaries to provide
collateral to the depository institution; and
 
(viii)           Liens securing Capital Lease Obligations, provided that such
Liens attach only to the fixed assets financed by such Capital Lease Obligations
and such Liens attach concurrently with, or within ninety (90) days, after the
acquisition thereof.
 
“Person” means an individual, a limited liability company, a partnership, a
joint venture, a corporation, a trust, an unincorporated organization, a
Governmental Authority or any other legal entity.
 
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“Proceeds” means “proceeds,” as such term is defined in the Uniform Commercial
Code and, in any event, includes, without limitation, (a) any and all proceeds
of any insurance, indemnity, warranty or guaranty payable with respect to any of
the Collateral, (b) any and all payments (in any form whatsoever) made or due
and payable from time to time in connection with any requisition, confiscation,
condemnation, seizure or forfeiture of all or any part of the Collateral by any
governmental body, authority, bureau or agency (or any person acting under color
of governmental authority), and (c) any and all other amounts from time to time
paid or payable under, in respect of or in connection with any of the
Collateral.
 
“Representative” means any Person acting as agent, representative or trustee on
behalf of the Secured Party from time to time.
 
 “Software” means all “software” as such term is defined in the Uniform
Commercial Code, now owned or hereafter acquired by a Debtor, other than
software embedded in any category of Goods, including, without limitation, all
computer programs and all supporting information provided in connection with a
transaction related to any program.
 
“Trademarks” means any trademarks, trade names, corporate names, company names,
business names, fictitious business names, trade styles, service marks, logos,
other business identifiers, prints and labels on which any of the foregoing have
appeared or appear, all registrations and recordings thereof, and all
applications in connection therewith, including, without limitation, the
trademarks and applications listed in Schedule V attached hereto (if any) and
renewals thereof, and all income, royalties, damages and payments now or
hereafter due and/or payable under or with respect to any of the foregoing,
including, without limitation, damages and payments for past, present and future
infringements of any of the foregoing and the right to sue for past, present and
future infringements of any of the foregoing.
 
“Uniform Commercial Code” shall mean the Uniform Commercial Code as in effect
from time to time in the State of New York; provided, that to the extent that
the Uniform Commercial Code is used to define any term herein and such term is
defined differently in different Articles or Divisions of the Uniform Commercial
Code, the definition of such term contained in Article or Division 9 shall
govern; provided, that, if, by mandatory provisions of applicable laws, any or
all of the attachment, perfection, or priority of Secured Party’s security
interest in Collateral is governed by the Uniform Commercial Code as enacted and
in effect in a jurisdiction other than the State of New York, the term “Uniform
Commercial Code” means the Uniform Commercial Code as enacted and in effect in
such other jurisdiction solely for purposes of the provisions hereof relating to
such attachment, perfection, or priority and for purposes of definitions related
to such provisions..
 
Section 2.  Representations, Warranties and Covenants of Debtors.  Each Debtor
represents and warrants to, and covenants with, the Secured Party as follows:
 
(a)           Such Debtor has rights in and the power to transfer the Collateral
in which it purports to grant a security interest pursuant to Section 3 hereof
(subject, with respect to after acquired Collateral, to such Debtor acquiring
the same) and no Lien other than Permitted Liens exists or will exist upon such
Collateral at any time.
 
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(b)           This Agreement is effective to create in favor of Secured Party a
valid security interest in and Lien upon all of such Debtor’s right, title and
interest in and to the Collateral, and upon (i) (A) the filing of appropriate
Uniform Commercial Code financing statements in the jurisdictions listed on
Schedule I attached hereto, and (B) each Deposit Account being subject to an
Account Control Agreement (as hereinafter defined) between the applicable Debtor
and depository institution and the Secured Party, such security interest will be
a duly perfected first priority security interest in all of the Collateral
(other than Instruments not constituting Chattel Paper), and (ii) upon delivery
of the Instruments to the Secured Party or its Representative, duly endorsed by
such Debtor or accompanied by appropriate instruments of transfer duly executed
by such Debtor, the security interest in the Instruments will be duly perfected.
 
(c)           All of the Equipment, Inventory and Goods owned by such Debtor is
located at the places as specified on Schedule I attached hereto.  Except as
disclosed on Schedule I, none of the Collateral is in the possession of any
bailee, warehousemen, processor or consignee.  Schedule I discloses such
Debtor’s name as of the date hereof as it appears in official filings in the
state or province, as applicable, of its incorporation, formation or
organization, the type of entity of such Debtor (including corporation,
partnership, limited partnership or limited liability company), organizational
identification number issued by such Debtor’s state of incorporation, formation
or organization (or a statement that no such number has been issued), such
Debtor’s state or province, as applicable, of incorporation, formation or
organization and the chief place of business, chief executive officer and the
office where such Debtor keeps its books and records and the states in which
such Debtor conducts its business.  Such Debtor has only one state or province,
as applicable, of incorporation, formation or organization. Such Debtor does not
do business and has not done business during the past five (5) years under any
trade name or fictitious business name except as disclosed on Schedule II
attached hereto.
 
(d)           No Copyrights, Patents or Trademarks listed on Schedules III, IV
and V, respectively, if any, have been adjudged invalid or unenforceable or have
been canceled, in whole or in part, or are not presently subsisting.  Each of
such Copyrights, Patents and Trademarks (if any) is valid and enforceable.  Such
Debtor is the sole and exclusive owner of the entire and unencumbered right,
title and interest in and to each of such Copyrights, Patents and Trademarks,
identified on Schedules III, IV and V, as applicable, as being owned by such
Debtor, free and clear of any liens, charges and encumbrances, including without
limitation licenses, shop rights and covenants by such Debtor not to sue third
persons.  Such Debtor has adopted, used and is currently using, or has a current
bona fide intention to use, all of such Trademarks and Copyrights.  Such Debtor
has no notice of any suits or actions commenced or threatened with reference to
the Copyrights, Patents or Trademarks owned by it.
 
(e)           Each Debtor agrees to deliver to the Secured Party an updated
Schedule I, II, III, IV and/or V within five (5) Business Days of any change
thereto.
 
(f)           All depositary and other accounts including, without limitation,
Deposit Accounts, securities accounts, brokerage accounts and other similar
accounts, maintained by each Debtor are described on Schedule VI hereto, which
description includes for each such account the name of the Debtor maintaining
such account, the name, address and telephone and telecopy numbers of the
financial institution at which such account is maintained, the account number
and the account officer, if any, of such account.  No
 
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Debtor shall open any new Deposit Accounts, securities accounts, brokerage
accounts or other accounts unless such Debtor shall have given Secured Party ten
(10) Business Days’ prior written notice of its intention to open any such new
accounts.  Each Debtor shall deliver to Secured Party a revised version of
Schedule VI showing any changes thereto within five (5) Business Days of any
such change.  Each Debtor hereby authorizes the financial institutions at which
such Debtor maintains an account to provide Secured Party or its Representative
with such information with respect to such account as Secured Party or its
Representative from time to time reasonably may request, and each Debtor hereby
consents to such information being provided to Secured Party and its
Representative.  In addition, all of such Debtor’s depositary, security,
brokerage and other accounts including, without limitation, Deposit Accounts
shall be subject to the provisions of Section 4.5 hereof.
 
(g)           Such Debtor does not own any Commercial Tort Claim except for
those disclosed on Schedule VII hereto (if any).
 
(h)           Such Debtor does not have any interest in real property except as
disclosed on Schedule VIII  (if any).  Each Debtor shall deliver to Secured
Party a revised version of Schedule VIII showing any changes thereto within ten
(10) Business Days of any such change.  Except as otherwise agreed to by Secured
Party, all such interests in real property are subject to a mortgage or deed of
trust (in form and substance satisfactory to Secured Party) in favor of Secured
Party (hereinafter, a “Mortgage”).
 
(i)           All Equipment (including, without limitation, Motor Vehicles)
owned by a Debtor and subject to a certificate of title or ownership statute is
described on Schedule IX hereto.

(j)           The Company has no direct or indirect subsidiaries other than
Options.

Section 3.  Collateral.  As collateral security for the prompt payment in full
when due (whether at stated maturity, by acceleration or otherwise) of the
Liabilities, each Debtor hereby pledges and grants to the Secured Party, for the
benefit of itself a Lien on and security interest in and to all of such Debtor’s
right, title and interest in the personal property and assets of such Debtor,
whether now owned by such Debtor or hereafter acquired and whether now existing
or hereafter coming into existence and wherever located (all being collectively
referred to herein as “Collateral”), including, without limitation:
 
(a)           all Instruments, together with all payments thereon or thereunder:
 
(b)           all Accounts;
 
(c)           all Inventory;
 
(d)           all General Intangibles (including payment intangibles (as defined
in the Uniform Commercial Code) and Software);
 
(e)           all Equipment;
 
(f)           all Documents;
 
(g)           all Contracts;
 
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(h)           all Goods;
 
(i)           all Investment Property;
 
(j)           all Deposit Accounts, including, without limitation, the balance
from time to time in all bank accounts maintained by such Debtor;
 
(k)           all Commercial Tort Claims specified on Schedule VII;
 
(l)           all As-extracted Collateral;
 
(m)           all Trademarks, Patents and Copyrights; and
 
(n)           all other tangible and intangible property of such Debtor,
including, without limitation, all interests in real property, Proceeds, tort
claims, products, accessions, rents, profits, income, benefits, substitutions,
additions and replacements of and to any of the property of such Debtor
described in the preceding clauses of this Section 3 (including, without
limitation, any proceeds of insurance thereon, insurance claims and all rights,
claims and benefits against any Person relating thereto), other rights to
payments not otherwise included in the foregoing, and all books, correspondence,
files, records, invoices and other papers, including without limitation all
tapes, cards, computer runs, computer programs, computer files and other papers,
documents and records in the possession or under the control of such Debtor, any
computer bureau or service company from time to time acting for such Debtor;
 
provided, however, that the Collateral shall not include any Excluded Property.
 
Section 4.  Covenants; Remedies.  In furtherance of the grant of the pledge and
security interest pursuant to Section 3 hereof, each Debtor hereby agrees with
the Secured Party as follows:
 
4.1.  Delivery and Other Perfection; Maintenance, etc.
 
(a)           Delivery of Instruments, Documents, Etc.  Each Debtor shall
deliver and pledge to the Secured Party or its Representative any and all
Instruments, negotiable Documents, Chattel Paper and certificated securities not
maintained in a securities account (accompanied by stock powers executed in
blank) duly endorsed and/or accompanied by such instruments of assignment and
transfer executed by such Debtor in such form and substance as the Secured Party
or its Representative may request; provided, that so long as no Event of Default
shall have occurred and be continuing, each Debtor may retain for collection in
the ordinary course of business any Instruments, negotiable Documents and
Chattel Paper received by such Debtor in the ordinary course of business, and
the Secured Party or its Representative shall, promptly upon request of a
Debtor, make appropriate arrangements for making any other Instruments,
negotiable Documents and Chattel Paper pledged by such Debtor available to such
Debtor for purposes of presentation, collection or renewal (any such arrangement
to be effected, to the extent deemed appropriate by the Secured Party or its
Representative, against trust receipt or like document). If a Debtor retains
possession of any Chattel Paper, negotiable Documents or Instruments pursuant to
the terms hereof, such Chattel Paper, negotiable Documents and Instruments shall
be marked with the following legend: “This writing and
 
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the obligations evidenced or secured hereby are subject to the security interest
of Customer Acquisition Network Holdings, Inc.”
 
(b)           Other Documents and Actions.  Each Debtor shall give, execute,
deliver, file and/or record any financing statement, registration, notice,
instrument, document, agreement, Mortgage or other papers that may be necessary
or desirable (in the reasonable judgment of the Secured Party or its
Representative) to create, preserve, perfect or validate the security interest
granted pursuant hereto (or any security interest or Mortgage contemplated or
required hereunder, including with respect to Section 2(h) of this Agreement) or
to enable the Secured Party or its Representative to exercise and enforce the
rights of the Secured Party hereunder with respect to such pledge and security
interest, provided that notices to account debtors in respect of any Accounts or
Instruments shall be subject to the provisions of clause (e)
below.  Notwithstanding the foregoing each Debtor hereby irrevocably authorizes
the Secured Party at any time and from time to time to file in any filing office
in any jurisdiction any Uniform Commercial Code initial financing statements
(and other similar filings or registrations under other applicable laws and
regulations pertaining to the creation, attachment, or perfection of security
interests) and amendments thereto that (a) indicate the Collateral (i) as all
assets of such Debtor or words of similar effect, regardless of whether any
particular asset comprised in the Collateral falls within the scope of Article 9
of the Uniform Commercial Code of the State of New York or such jurisdiction, or
(ii) as being of an equal or lesser scope or with greater detail, and (b)
contain any other information required by part 5 of Article 9 of the Uniform
Commercial Code of the State of New York or any other State for the sufficiency
or filing office acceptance of any financing statement or amendment, including
(i) whether such Debtor is an organization, the type of organization and any
organization identification number issued to such Debtor, and (ii) in the case
of a financing statement filed as a fixture filing or indicating Collateral as
As-extracted Collateral or timber to be cut, a sufficient description of real
property to which the Collateral relates.  Each Debtor agrees to furnish any
such information to the Secured Party promptly upon request.  Each Debtor also
ratifies its authorization for the Secured Party to have filed in any
jurisdiction any like initial financing statements or amendments thereto if
filed prior to the date hereof.
 
(c)           Books and Records.  Each Debtor (or the Company on behalf of a
Debtor) shall maintain at its own cost and expense complete and accurate books
and records of the Collateral, including, without limitation, a record of all
payments received and all credits granted with respect to the Collateral and all
other dealings with the Collateral.  Upon the occurrence and during the
continuation of any Event of Default, each Debtor shall deliver and turn over
any such books and records (or true and correct copies thereof) to the Secured
Party or its Representative at any time on demand.  Each Debtor shall permit any
Representative of the Secured Party to inspect such books and records upon
reasonable advance notice, at any time during reasonable business hours and will
provide photocopies thereof at such Debtor’s expense to the Secured Party upon
request of the Secured Party; provided, that, after the occurrence of an Event
of Default, Debtors shall permit any Representative of the Secured Party to
inspect such books and records at any time with or without prior notice.
 
(d)           Motor Vehicles.  Each Debtor shall, promptly upon acquiring same,
cause the Secured Party to be listed as the lienholder on each certificate of
title or ownership covering any items of Equipment, including Motor Vehicles,
having a value in excess of $50,000 in the aggregate for all such items of
Equipment of the Debtor, or
 
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otherwise comply with the certificate of title or ownership laws of the relevant
jurisdiction issuing such certificate of title or ownership in order to properly
evidence and perfect Secured Party’s security interest in the assets represented
by such certificate of title or ownership.
 
(e)           Notice to Account Debtors; Verification.  (i) Upon the occurrence
and during the continuance of any Event of Default (or if any rights of set-off
(other than set-offs against an Account arising under the Contract giving rise
to the same Account) or contra accounts may be asserted), upon request of the
Secured Party or its Representative, each Debtor shall promptly notify (and each
Debtor hereby authorizes the Secured Party and its Representative so to notify)
each account debtor in respect of any Accounts or Instruments or other Persons
obligated on the Collateral that such Collateral has been assigned to the
Secured Party hereunder, and that any payments due or to become due in respect
of such Collateral are to be made directly to the Secured Party, and (ii) the
Secured Party and its Representative shall have the right at any time or times
to make direct verification with the account debtors or other Persons obligated
on any and all of the Accounts or other Collateral.
 
(f)           Intellectual Property.  Each Debtor represents and warrants that
the Copyrights, Patents and Trademarks listed on Schedules III, IV and V,
respectively (if any), constitute all of the registered Copyrights and all of
the Patents and Trademarks now owned by such Debtor.  If such Debtor shall (i)
obtain rights to any new patentable inventions, any registered Copyrights or any
Patents or Trademarks, or (ii) become entitled to the benefit of any registered
Copyrights or any Patents or Trademarks or any improvement on any Patent, the
provisions of this Agreement above shall automatically apply thereto and such
Debtor shall give to Secured Party prompt written notice thereof.  Each Debtor
hereby authorizes Secured Party to modify this Agreement by amending Schedules
III, IV and V, as applicable, to include any such registered Copyrights or any
such Patents and Trademarks.  Each Debtor shall have the duty (i) to prosecute
diligently any patent, trademark, or service mark applications pending as of the
date hereof or hereafter, (ii) to make application on unpatented but patentable
inventions and on trademarks, copyrights and service marks, as appropriate,
(iii) to preserve and maintain all rights in the Copyrights, Patents and
Trademarks, to the extent material to the operations of the business of such
Debtor and (iv) to ensure that the Copyrights, Patents and Trademarks are and
remain enforceable, to the extent material to the operations of the business of
such Debtor.  Any expenses incurred in connection with such Debtor’s obligations
under this Section 4.1(f) shall be borne by such Debtor.  Except for any such
items that a Debtor reasonably believes (using prudent industry customs and
practices) are no longer necessary for the on-going operations of its business,
no Debtor shall abandon any right to file a patent, trademark or service mark
application, or abandon any pending patent, trademark or service mark
application or any other Copyright, Patent or Trademark without the written
consent of Secured Party, which consent shall not be unreasonably withheld.
 
(g)           Further Identification of Collateral.  Each Debtor will, when and
as often as reasonably requested by the Secured Party or its Representative,
furnish to the Secured Party or such Representative, statements and schedules
further identifying and describing the Collateral and such other reports in
connection with the Collateral as the Secured Party or its Representative may
reasonably request, all in reasonable detail.
 
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(h)           Investment Property.  Each Debtor will take any and all actions
required or requested by the Secured Party, from time to time, to (i) cause the
Secured Party to obtain exclusive control of any Investment Property owned by
such Debtor in a manner acceptable to the Secured Party and (ii) obtain from any
issuers of Investment Property and such other Persons, for the benefit of the
Secured Party, written confirmation of the Secured Party’s control over such
Investment Property.  For purposes of this Section 4.1(h), the Secured Party
shall have exclusive control of Investment Property if (i) such Investment
Property consists of certificated securities and a Debtor delivers such
certificated securities to the Secured Party (with appropriate endorsements if
such certificated securities are in registered form); (ii) such Investment
Property consists of uncertificated securities and either (x) a Debtor delivers
such uncertificated securities to the Secured Party or (y) the issuer thereof
agrees, pursuant to documentation in form and substance satisfactory to the
Secured Party, that it will comply with instructions originated by the Secured
Party without further consent by such Debtor, and (iii) such Investment Property
consists of security entitlements and either (x) the Secured Party becomes the
entitlement holder thereof or (y) the appropriate securities intermediary
agrees, pursuant to the documentation in form and substance satisfactory to the
Secured Party, that it will comply with entitlement orders originated by the
Secured Party without further consent by any Debtor.
(i)       Reserved.

 
(j)           Commercial Tort Claims.  Each Debtor shall promptly notify Secured
Party of any Commercial Tort Claim acquired by it that concerns a claim in
excess of $50,000 and unless otherwise consented to by Secured Party, such
Debtor shall enter into a supplement to this Agreement granting to Secured Party
a Lien on and security interest in such Commercial Tort Claim.
 
4.2  Other Liens.  Debtors will not create, permit or suffer to exist, and will
defend the Collateral against and take such other action as is necessary to
remove, any Lien on the Collateral except Permitted Liens, and will defend the
right, title and interest of the Secured Party in and to the Collateral and in
and to all Proceeds thereof against the claims and demands of all Persons
whatsoever.
 
4.3  Preservation of Rights.  Whether or not any Event of Default has occurred
or is continuing, the Secured Party and its Representative may, but shall not be
required to, take any steps the Secured Party or its Representative deems
necessary or appropriate to preserve any Collateral or any rights against third
parties to any of the Collateral, including obtaining insurance for the
Collateral at any time when such Debtor has failed to do so, and Debtors shall
promptly pay, or reimburse the Secured Party for, all expenses incurred in
connection therewith.
 
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4.4  Formation of Subsidiaries; Name Change; Location; Bailees.
 
(a)           No Debtor shall form or acquire any subsidiary unless (i) such
Debtor pledges all of the stock of such subsidiary to the Secured Party (in the
case of Company, pursuant to the existing pledge agreement by Company in favor
of the Secured Party or, with respect to a Debtor other than Company, pursuant
to a pledge agreement in form and substance acceptable to Secured Party), (ii)
such subsidiary becomes a party to this Agreement and all other applicable
Security Documents and (iii) the formation or acquisition of such Subsidiary is
not prohibited by the terms of the transaction documents.
 
(b)           No Debtor shall (i) reincorporate or reorganize itself under the
laws of any jurisdiction other than the jurisdiction in which it is incorporated
or organized as of the date hereof without the prior written consent of Secured
Party, (ii) change its legal name without notifying the Secured Party in writing
at least 10 days in advance of such change, or (iii) otherwise change its
identity or corporate structure without the prior written consent of Secured
Party.  Each Debtor will notify Secured Party promptly in writing at least ten
(10) days prior to any such change described in the immediately prior sentence
or in the proposed use by such Debtor of any tradename or fictitious business
name other than any such name set forth on Schedule II attached hereto.
 
(c)           Except for the sale of Inventory in the ordinary course of
business, each Debtor will keep the Collateral at the locations specified in
Schedule I.  Each Debtor will give Secured Party thirty (30) day’s prior written
notice of any change in such Debtor’s chief place of business or of any new
location for any of the Collateral.
 
(d)           If any Collateral is at any time in the possession or control of
any warehousemen, bailee, consignee or processor, such Debtor shall, upon the
request of Secured Party or its Representative, notify such warehousemen,
bailee, consignee or processor of the Lien and security interest created hereby
and shall instruct such Person to hold all such Collateral for Secured Party’s
account subject to Secured Party’s instructions.
 
(e)           Each Debtor acknowledges that until this Agreement has been
terminated in accordance with Section 4.12 below, it is not authorized to file
any financing statement or amendment or termination statement with respect to
any financing statement without the prior written consent of Secured Party and
agrees that it will not do so without the prior written consent of Secured
Party, subject to such Debtor’s rights under Section 9-509(d)(2) to the Uniform
Commercial Code.
 
(f)           No Debtor shall enter into any Contract that restricts or
prohibits the grant to Secured Party of a security interest in Accounts, Chattel
Paper, Instruments or payment intangibles or the proceeds of the foregoing.
 
4.5           Bank Accounts and Securities Accounts.
 
(a)           On or prior to the date hereof, the Secured Party and each Debtor,
as applicable, shall enter into an account control agreement or securities
account control agreement, as applicable, which agreement shall be in form and
substance reasonably satisfactory to the Secured Party (each, an “Account
Control Agreement”), with each financial institution with which such Debtor
maintains from time to time any Deposit
 
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Accounts (general or special), securities accounts, brokerage accounts or other
similar accounts, which financial institutions are set forth on Schedule VI
attached hereto.  Pursuant to the Account Control Agreements and pursuant
hereto, each such Debtor grants and shall grant to the Secured Party a
continuing lien upon, and security interest in, all such accounts and all funds
at any time paid, deposited, credited or held in such accounts (whether for
collection, provisionally or otherwise) or otherwise in the possession of such
financial institutions, and each such financial institution shall act as the
Secured Party’s agent in connection therewith.  Following the Closing Date, no
Debtor shall establish any new Deposit Account, securities account, brokerage
account or other similar account with any financial institution unless prior
thereto, the Secured Party and such Debtor shall have entered into an Account
Control Agreement with such financial institution which purports to cover such
account.  Each Debtor shall deposit and keep on deposit all of its funds into a
Deposit Account which is subject to an Account Control Agreement.
 
(b)           Upon the Secured Party’s request following the occurrence and
during the continuance of an Event of Default, each Debtor shall establish
lock-box or blocked accounts (collectively, “Blocked Accounts”) in such Debtor’s
name with such banks as are reasonably acceptable to the Secured Party
(“Collecting Banks”), subject to irrevocable instructions in a form reasonably
acceptable to the Secured Party, to which the obligors of all Accounts shall
directly remit all payments on Accounts and in which such Debtor will
immediately deposit all cash payments for Inventory or other cash payments
constituting proceeds of Collateral in the identical form in which such payment
was made, whether by cash or check.  In addition, the Secured Party may
establish one or more depository accounts at each Collecting Bank or at a
centrally located bank (collectively, the “Depository Account”).  All amounts
held or deposited in the Blocked Accounts held by such Collecting Bank shall be
transferred to the Depository Account without any further notice or action
required by Secured Party.  Subject to the foregoing, each Debtor hereby agrees
that all payments received by the Secured Party whether by cash, check, wire
transfer or any other instrument, made to such Blocked Accounts or otherwise
received by the Secured Party and whether in respect of the Accounts or as
proceeds of other Collateral or otherwise will be the sole and exclusive
property of the Secured Party.  Each Debtor, and any of its Affiliates,
employees, agents and other Persons acting for or in concert with such Debtor
shall, acting as trustee for the Secured Party, receive, as the sole and
exclusive property of the Secured Party, any moneys, checks, notes, drafts or
other payments relating to and/or proceeds of Accounts or other Collateral which
come into the possession or under the control of such Debtor or any Affiliates,
employees, agent or other Persons acting for or in concert with such Debtor, and
immediately upon receipt thereof, such Debtor or Persons shall deposit the same
or cause the same to be deposited in kind, in a Blocked Account.
 
4.6  Events of Default, Etc.  During the period during which an Event of Default
shall have occurred and be continuing:
 
(a)           each Debtor shall, at the request of the Secured Party or its
Representative, assemble the Collateral and make it available to Secured Party
or its Representative at a place or places designated by the Secured Party or
its Representative which are reasonably convenient to Secured Party or its
Representative, as applicable, and such Debtor;
 
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(b)           the Secured Party or its Representative may make any reasonable
compromise or settlement deemed desirable with respect to any of the Collateral
and may extend the time of payment, arrange for payment in installments, or
otherwise modify the terms of, any of the Collateral;
 
(c)           the Secured Party shall have all of the rights and remedies with
respect to the Collateral of a secured party under the Uniform Commercial Code
(whether or not said Uniform Commercial Code is in effect in the jurisdiction
where the rights and remedies are asserted) and such additional rights and
remedies to which a secured party is entitled under the laws in effect in any
jurisdiction where any rights and remedies hereunder may be asserted, including,
without limitation, the right, to the maximum extent permitted by law, to: (i)
exercise all voting, consensual and other powers of ownership pertaining to the
Collateral as if the Secured Party were the sole and absolute owner thereof (and
each Debtor agrees to take all such action as may be appropriate to give effect
to such right) and (ii) to the appointment of a receiver or receivers for all or
any part of the Collateral or business of a Debtor, whether such receivership be
incident to a proposed sale or sales of such Collateral or otherwise and without
regard to the value of the Collateral or the solvency of any person or persons
liable for the payment of the Liabilities secured by such Collateral.  Each
Debtor hereby consents to the appointment of such receiver or receivers, waives
any and all defenses to such appointment and agrees that such appointment shall
in no manner impair, prejudice or otherwise affect the rights of Secured Party
under this Agreement.  Each Debtor hereby expressly waives notice of a hearing
for appointment of a receiver and the necessity for bond or an accounting by the
receiver;
 
(d)           the Secured Party or its Representative in their discretion may,
in the name of the Secured Party or in the name of a Debtor or otherwise,
demand, sue for, collect or receive any money or property at any time payable or
receivable on account of or in exchange for any of the Collateral, but shall be
under no obligation to do so;
 
(e)  the Secured Party or its Representative may take immediate possession and
occupancy of any premises owned, used or leased by a Debtor (subject to the
terms of any lease relating thereto) and exercise all other rights and remedies
which may be available to the Secured Party;
 
(f)           the Secured Party may, upon reasonable notice (such reasonable
notice to be determined by Secured Party in its sole and absolute discretion) to
Debtors of the time and place, with respect to the Collateral or any part
thereof which shall then be or shall thereafter come into the possession,
custody or control of the Secured Party or its Representative, sell, lease,
license, assign or otherwise dispose of all or any part of such Collateral, at
such place or places as the Secured Party deems best, and for cash or for credit
or for future delivery (without thereby assuming any credit risk), at public or
private sale, without demand of performance or notice of intention to effect any
such disposition or of the time or place thereof (except such notice as is
required above or by applicable statute and cannot be waived), and the Secured
Party or anyone else may be the purchaser, lessee, licensee, assignee or
recipient of any or all of the Collateral so disposed of at any public sale (or,
to the extent permitted by law, at any private sale) and thereafter hold the
same absolutely, free from any claim or right of whatsoever kind, including any
right or equity of redemption (statutory or otherwise), of Debtors, any such
demand, notice and right or equity being hereby expressly waived and
released.  The Secured Party may, without notice or publication, adjourn any
public or private sale or
 
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cause the same to be adjourned from time to time by announcement at the time and
place fixed for the sale, and such sale may be made at any time or place to
which the sale may be so adjourned; and
 
(g)           the rights, remedies and powers conferred by this Section 4.6 are
in addition to, and not in substitution for, any other rights, remedies or
powers that the Secured Party may have under any transaction document, at law,
in equity or by or under the Uniform Commercial Code or any other statute or
agreement.  The Secured Party may proceed by way of any action, suit or other
proceeding at law or in equity and no right, remedy or power of the Secured
Party will be exclusive of or dependent on any other.  The Secured Party may
exercise any of its rights, remedies or powers separately or in combination and
at any time.
 
The proceeds of each collection, sale or other disposition under this Section
4.6 shall be applied in accordance with Section 4.9 hereof.
 
4.7  Deficiency.  If the proceeds of sale, collection or other realization of or
upon the Collateral are insufficient to cover the costs and expenses of such
realization and the payment in full of the Liabilities, Debtors shall remain
liable for any deficiency.
 
4.8  Private Sale.  Each Debtor recognizes that the Secured Party may be unable
to effect a public sale of any or all of the Collateral consisting of securities
by reason of certain prohibitions contained in the Securities Act of 1933, as
amended (the “Act”), and applicable state securities laws, but may be compelled
to resort to one or more private sales thereof to a restricted group of
purchasers who will be obliged to agree, among other things, to acquire such
Collateral for their own account for investment and not with a view to the
distribution or resale thereof.  Each Debtor acknowledges and agrees that any
such private sale may result in prices and other terms less favorable to the
seller than if such sale were a public sale and, notwithstanding such
circumstances, agrees that any such private sale shall be deemed to have been
made in a commercially reasonable manner.  The Secured Party shall be under no
obligation to delay a sale of any of the Collateral to permit a Debtor to
register such Collateral for public sale under the Act, or under applicable
state securities laws, even if Debtors would agree to do so.  The Secured Party
shall not incur any liability as a result of the sale of any such Collateral, or
any part thereof, at any private sale provided for in this Agreement conducted
in a commercially reasonable manner, and each Debtor hereby waives any claims
against the Secured Party arising by reason of the fact that the price at which
the Collateral may have been sold at such a private sale was less than the price
which might have been obtained at a public sale or was less than the aggregate
amount of the Liabilities, even if the Secured Party accepts the first offer
received and does not offer the Collateral to more than one offeree.
 
Each Debtor further agrees to do or cause to be done all such other acts and
things as may be necessary to make such sale or sales of any portion or all of
any such Collateral valid and binding and in compliance with any and all
applicable laws, regulations, orders, writs, injunctions, decrees or awards of
any and all courts, arbitrators or governmental instrumentalities, domestic or
foreign, having jurisdiction over any such sale or sales, all at such Debtor’s
expense, provided that Debtors shall be under no obligation to take any action
to enable any or all of such Collateral to be registered under the provisions of
the Act.  Each Debtor further agrees that a breach of any of the covenants
contained in this Section 4.8 will cause irreparable injury to the Secured
Party, that the Secured Party has no adequate remedy at law in respect of such
breach and, as a consequence, agrees that each and every covenant contained in
this Section 4.8 shall be specifically enforceable against Debtors, and each
Debtor hereby waives and agrees not to assert
 
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any defenses against an action for specific performance of such covenants except
for a defense that no Event of Default has occurred and is continuing.
 
4.9  Application of Proceeds.  The proceeds of any collection, sale or other
realization of all or any part of the Collateral, and any other cash at the time
held by the Secured Party under this Agreement, shall be applied in the manner
set forth in the Note (or, if not so set forth, in a manner acceptable to, and
at the election of, the Secured Party).
 
4.10  Attorney-in-Fact.  Each Debtor hereby irrevocably constitutes and appoints
the Secured Party, with full power of substitution, as its true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of such Debtor and in the name of such Debtor or in its own name, from
time to time in the discretion of the Secured Party, for the purpose of carrying
out the terms of this Agreement, to take any and all appropriate action and to
execute and deliver any and all documents and instruments which may be necessary
or desirable to perfect or protect any security interest granted hereunder or to
maintain the perfection or priority of any security interest granted hereunder,
and, without limiting the generality of the foregoing, hereby gives the Secured
Party the power and right, on behalf of such Debtor, without notice to or assent
by such Debtor, to do the following upon the occurrence and during the
continuation of any Event of Default:
 
(a)           to take any and all appropriate action and to execute and deliver
any and all documents and instruments which may be necessary or desirable to
accomplish the purposes of this Agreement;
 
(b)           to ask, demand, collect, receive and give acquittance and receipts
for any and all moneys due and to become due under any Collateral and, in the
name of such Debtor or its own name or otherwise, to take possession of and
endorse and collect any checks, drafts, notes, acceptances or other Instruments
for the payment of moneys due under any Collateral and to file any claim or to
take any other action or proceeding in any court of law or equity or otherwise
deemed appropriate by the Secured Party for the purpose of collecting any and
all such moneys due under any Collateral whenever payable and to file any claim
or to take any other action or proceeding in any court of law or equity or
otherwise deemed appropriate by the Secured Party for the purpose of collecting
any and all such moneys due under any Collateral whenever payable;
 
(c)           to pay or discharge charges or liens levied or placed on or
threatened against the Collateral, to effect any insurance called for by the
terms of this Agreement and to pay all or any part of the premiums therefor;
 
(d)           to direct any party liable for any payment under any of the
Collateral to make payment of any and all moneys due, and to become due
thereunder, directly to the Secured Party or as the Secured Party shall direct,
and to receive payment of and receipt for any and all moneys, claims and other
amounts due, and to become due at any time, in respect of or arising out of any
Collateral;
 
(e)           to sign and indorse any invoices, freight or express bills, bills
of lading, storage or warehouse receipts, drafts against debtors, assignments,
verifications and notices in connection with accounts and other Documents
constituting or relating to the Collateral;
 
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(f)           to commence and prosecute any suits, actions or proceedings at law
or in equity in any court of competent jurisdiction to collect the Collateral or
any part thereof and to enforce any other right in respect of any Collateral;
 
(g)           to defend any suit, action or proceeding brought against a Debtor
with respect to any Collateral;
 
(h)           to settle, compromise or adjust any suit, action or proceeding
described above and, in connection therewith, to give such discharges or
releases as the Secured Party may deem appropriate;
 
(i)           to the extent that a Debtor’s authorization given in Section
4.1(b) of this Agreement is not sufficient to file such financing statements
with respect to this Agreement, with or without such Debtor’s signature, or to
file a photocopy of this Agreement in substitution for a financing statement, as
the Secured Party may deem appropriate and to execute in such Debtor’s name such
financing statements and amendments thereto and continuation statements which
may require such Debtor’s signature; and
 
(j)           generally to sell, transfer, pledge, make any agreement with
respect to or otherwise deal with any of the Collateral as fully and completely
as though the Secured Party were the absolute owners thereof for all purposes,
and to do, at the Secured Party’s option and at such Debtor’s expense, at any
time, or from time to time, all acts and things which the Secured Party
reasonably deems necessary to protect, preserve or realize upon the Collateral
and the Secured Party’s lien therein, in order to effect the intent of this
Agreement, all as fully and effectively as such Debtor might do.
 
Each Debtor hereby ratifies, to the extent permitted by law, all that such
attorneys lawfully do or cause to be done by virtue hereof.  The power of
attorney granted hereunder is a power coupled with an interest and shall be
irrevocable until the Liabilities are indefeasibly paid in full in cash and this
Agreement is terminated in accordance with Section 4.12 hereof.
 
Each Debtor also authorizes the Secured Party, at any time from and after the
occurrence and during the continuation of any Event of Default, (x) to
communicate in its own name with any party to any Contract with regard to the
assignment of the right, title and interest of such Debtor in and under the
Contracts hereunder and other matters relating thereto and (y) to execute, in
connection with any sale of Collateral provided for in Section 4.6 hereof, any
endorsements, assignments or other instruments of conveyance or transfer with
respect to the Collateral.
 
4.11  Perfection.  Prior to or concurrently with the execution and delivery of
this Agreement, each Debtor shall:
 
(a)           file such financing statements, assignments for security and other
documents in such offices as may be necessary or as the Secured Party or the
Representative may request to perfect the security interests granted by Section
3 of this Agreement; and
 
(b)           at Secured Party’s request, deliver to the Secured Party or its
Representative the originals of all Instruments together with, in the case of
Instruments constituting promissory notes, allonges attached thereto showing
such promissory notes to be payable to the order of a blank payee.
 
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4.12  Termination.  This Agreement and the Liens and security interests granted
hereunder shall not terminate until the termination of the Note and the full and
complete performance and indefeasible satisfaction of all the Liabilities (i) in
respect of the Note (including, without limitation, the indefeasible payment in
full in cash of all such Liabilities) and (ii) with respect to which claims have
been asserted by the Secured Party, whereupon the Secured Party shall forthwith
cause to be assigned, transferred and delivered, against receipt but without any
recourse, warranty or representation whatsoever, any remaining Collateral to or
on the order of Debtors, at which time this Agreement and Liens granted pursuant
hereto shall automatically terminate.  The Secured Party shall also execute and
deliver to Debtors upon such termination and at Debtors’ expense such Uniform
Commercial Code termination statements, certificates for terminating the liens
on the Motor Vehicles (if any) and such other documentation as shall be
reasonably requested by Debtors to effect the termination and release of the
Liens and security interests in favor of the Secured Party affecting the
Collateral.
 
4.13  Further Assurances.  At any time and from time to time, upon the written
request of the Secured Party or its Representative, and at the sole expense of
Debtors, Debtors will promptly and duly execute and deliver any and all such
further instruments, documents and agreements and take such further actions as
are necessary or the Secured Party or its Representative may reasonably require
in order for the Secured Party to obtain the full benefits of this Agreement and
of the rights and powers herein granted in favor of the Secured Party,
including, without limitation, using Debtors’ commercially reasonable efforts to
secure all consents and approvals necessary or appropriate for the assignment to
the Secured Party of any Collateral held by Debtors or in which a Debtor has any
rights not heretofore assigned, the filing of any financing or continuation
statements under the Uniform Commercial Code with respect to the liens and
security interests granted hereby, transferring Collateral to the Secured
Party’s possession (if a security interest in such Collateral can be perfected
by possession), placing the interest of the Secured Party as lienholder on the
certificate of title of any Motor Vehicle and obtaining waivers of liens from
landlords and mortgagees.  Each Debtor also hereby authorizes the Secured Party
and its Representative to file any such financing or continuation statement
without the signature of such Debtor to the extent permitted by applicable law.
 
4.14  Limitation on Duty of Secured Party.  The powers conferred on the Secured
Party under this Agreement are solely to protect the Secured Party’s interest in
the Collateral and shall not impose any duty upon it to exercise any such
powers.  The Secured Party shall be accountable only for amounts that it
actually receives as a result of the exercise of such powers and neither the
Secured Party nor its Representative nor any of their respective officers,
directors, employees or agents shall be responsible to Debtors for any act or
failure to act, except for willful misconduct.  Without limiting the foregoing,
the Secured Party and any Representative shall be deemed to have exercised
reasonable care in the custody and preservation of the Collateral in their
possession if such Collateral is accorded treatment substantially equivalent to
that which the relevant Secured Party or any Representative, in its individual
capacity, accords its own property consisting of the type of Collateral
involved, it being understood and agreed that neither the Secured Party nor any
Representative shall have any responsibility for taking any necessary steps
(other than steps taken in accordance with the standard of care set forth above)
to preserve rights against any Person with respect to any Collateral.
 
Also without limiting the generality of the foregoing, neither the Secured Party
nor any Representative shall have any obligation or liability under any Contract
or license by reason of or arising out of this Agreement or the granting to the
Secured Party of a security interest therein or assignment thereof or the
receipt by the Secured Party or any Representative of any payment relating to
any Contract or license pursuant hereto, nor shall the Secured Party or any
 
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Representative be required or obligated in any manner to perform or fulfill any
of the obligations of Debtors under or pursuant to any Contract or license, or
to make any payment, or to make any inquiry as to the nature or the sufficiency
of any payment received by it or the sufficiency of any performance by any party
under any Contract or license, or to present or file any claim, or to take any
action to collect or enforce any performance or the payment of any amounts which
may have been assigned to it or to which it may be entitled at any time or
times.
 
Section 5.  Miscellaneous.
 
5.1  No Waiver.  No failure on the part of the Secured Party or any of its
Representatives to exercise, and no course of dealing with respect to, and no
delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise by the Secured Party or
any of its Representatives of any right, power or remedy hereunder preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy.  The rights and remedies hereunder provided are cumulative and may be
exercised singly or concurrently, and are not exclusive of any rights and
remedies provided by law.
 
5.2  Governing Law.  All questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by the
internal laws of the State of New York, without giving effect to any choice of
law or conflict of law provision or rule (whether of the State of New York or
any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of New York
 
5.3  Notices.  From the date of this Agreement until the first date following
the date on which the Note is not outstanding and this Agreement has terminated,
the Company shall and shall cause each of its Subsidiaries to notify the Secured
Party in writing (A) at least 10 days in advance of any change in such Person’s
legal name and (B) within 10 days of the change of the use of any trade name,
assumed name, fictitious name or division name not previously disclosed to the
Secured Party in writing.  All of the foregoing notices also shall be provided
by the Company or the applicable Subsidiary to each Secured Party in writing.
 
5.4  Amendments, Etc.  The terms of this Agreement may be waived, altered or
amended only by an instrument in writing duly executed by the Debtor sought to
be charged or benefited thereby and the Secured Party.  Any such amendment or
waiver shall be binding upon the Secured Party and the Debtor sought to be
charged or benefited thereby and their respective successors and assigns.
 
5.5  Successors and Assigns.  This Agreement shall be binding upon and inure to
the benefit of the respective successors and assigns of each of the parties
hereto, provided, that no Debtor shall assign or transfer its rights hereunder
without the prior written consent of the Secured Party.  Secured Party may
assign its rights hereunder without the consent of Debtors, in which event such
assignee shall be deemed to be Secured Party hereunder with respect to such
assigned rights.
 
5.6  Counterparts; Headings.  This Agreement may be authenticated in any number
of counterparts, all of which taken together shall constitute one and the same
instrument and any of the parties hereto may authenticate this Agreement by
signing any such counterpart.  This Agreement may be authenticated by manual
signature or facsimile, .pdf or similar electronic signature, all of which shall
be equally valid. The headings in this Agreement are for convenience of
reference only and shall not alter or otherwise affect the meaning hereof.
 
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5.7  Severability.  If any provision hereof is invalid and unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (a) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in favor of the Secured Party and its
Representative in order to carry out the intentions of the parties hereto as
nearly as may be possible and (b) the invalidity or unenforceability of any
provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction.
 
5.8  SUBMISSION TO JURISDICTION; WAIVER OF VENUE; SERVICE OF PROCESS.  (A)  EACH
DEBTOR HEREBY IRREVOCABLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY
UNITED STATES FEDERAL OR NEW YORK STATE COURT SITTING IN THE CITY OF NEW YORK,
BOROUGH OF MANHATTAN IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO
THIS AGREEMENT AND EACH DEBTOR HEREBY IRREVOCABLY AGREES THAT ALL CLAIMS IN
RESPECT OF SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN ANY SUCH
COURT AND IRREVOCABLY WAIVES ANY OBJECTION IT MAY NOW OR HEREAFTER HAVE AS TO
THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN SUCH A COURT OR THAT
SUCH COURT IS AN INCONVENIENT FORUM.  NOTHING HEREIN SHALL LIMIT THE RIGHT OF
SECURED PARTY TO BRING PROCEEDINGS AGAINST ANY DEBTOR IN THE COURTS OF ANY OTHER
JURISDICTION.  ANY JUDICIAL PROCEEDING BY A DEBTOR AGAINST SECURED PARTY, ANY
BUYER OR ANY AFFILIATE THEREOF INVOLVING, DIRECTLY OR INDIRECTLY, ANY MATTER IN
ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTION WITH THIS AGREEMENT SHALL BE
BROUGHT ONLY IN A COURT IN NEW YORK, NEW YORK (AND SECURED PARTY HEREBY SUBMITS
TO THE JURISDICTION OF SUCH COURT).  EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES
PERSONAL SERVICE OF PROCESS AND CONSENTS TO PROCESS BEING SERVED IN ANY SUCH
ACTION OR PROCEEDING BY MAILING A COPY THEREOF TO SUCH PARTY AT THE ADDRESS FOR
NOTICES TO IT IN ACCORDANCE WITH SECTION 5.3 OF  THIS AGREEMENT AND AGREES THAT
SUCH NOTICE SHALL CONSTITUTE GOOD AND SUFFICIENT SERVICE OF PROCESS AND NOTICE
THEREOF.  NOTHING CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT
TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW.
 
5.9  WAIVER OF RIGHT TO TRIAL BY JURY.  EACH DEBTOR AND SECURED PARTY EACH WAIVE
THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED
UPON OR ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE
BROUGHT BY ANY OF THE PARTIES AGAINST ANY OTHER PARTY OR PARTIES, WHETHER WITH
RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE.   EACH DEBTOR AND SECURED
PARTY EACH AGREE THAT ANY SUCH CLAIM OR CAUSE OF ACTION SHALL BE TRIED BY A
COURT TRIAL WITHOUT A JURY.  WITHOUT LIMITING THE FOREGOING, THE PARTIES FURTHER
AGREE THAT THEIR RESPECTIVE RIGHT TO A TRIAL BY JURY IS WAIVED BY OPERATION  OF
THIS SECTION AS TO ANY ACTION, COUNTERCLAIM OR OTHER PROCEEDING WHICH SEEKS, IN
WHOLE OR IN PART, TO CHALLENGE THE VALIDITY OR ENFORCEABILITY OF THIS AGREEMENT
OR ANY PROVISION HEREOF.  THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.
 
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5.10           Joint and Several.  The obligations, covenants and agreements of
Debtors hereunder, except their several grant of Liens and security interests
under Section 3 hereof, shall be the joint and several obligations, covenants
and agreements of each Debtor, whether or not specifically stated herein.
 
5.11           No Strict Construction.  The language used in this Agreement will
be deemed to be the language chosen by the parties to express their mutual
intent, and no rules of strict construction will be applied against any party.
 
5.12           Entire Agreement.  This Agreement supersedes all other prior oral
or written agreements between each Debtor, Secured Party and its affiliates and
persons acting on their behalf with respect to the matters discussed herein, and
this Agreement and the transaction documents and instruments referenced herein
and therein contain the entire understanding of the parties with respect to the
matters covered herein and therein.
 
- Remainder of Page Intentionally Left Blank; Signature Page Follows -
 
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IN WITNESS WHEREOF, the parties hereto have caused this Security Agreement to be
duly executed and delivered as of the day and year first above written.

 

 
DEBTORS:
     
OPTIONS MEDIA GROUP HOLDINGS, INC.,
  a Delaware corporation       By: /s/Scott Frohman   Name: Scott Frohman  
Title:   Chief Executive Officer  
FEIN:

 

 
OPTIONS ACQUISITION SUB, INC.,
 
a Delaware corporation
      By:  /s/Scott Frohman   Name: Scott Frohman   Title:   Chief Executive
Officer   FEIN:

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  SECURED PARTY:      
CUSTOMER ACQUISITION NETWORK HOLDINGS, INC., a Delaware corporation company,
      By: /s/Michael D. Mathews   Name: Michael D. Mathews  
Title:   Chief Executive Officer

 

 
Notice Address:
      Customer Acquisition Network Holdings, Inc.   200 Park Avenue South  
Suite 908-909
 
New York, NY
  Attention:  Michael D. Mathews   Phone:  (954) 712-0000

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EXHIBIT A

Form of Joinder
Joinder to Security Agreement

The undersigned, ______________________________, hereby joins in the execution
of that certain Security Agreement dated as of June 23, 2008 (as amended,
restated, supplemented or otherwise modified from time to time, the “Security
Agreement”) by OPTIONS MEDIA GROUP HOLDINGS, INC., a Delaware corporation,
OPTIONS ACQUISITION SUB, INC., a Delaware corporation, and each other Person
that becomes a Debtor thereunder after the date hereof and pursuant to the terms
thereof, to and in favor of Customer Acquisition Network Holdings, Inc.  By
executing this Joinder, the undersigned hereby agrees that it is a Debtor
thereunder and agrees to be bound by all of the terms and provisions of the
Security Agreement.

The undersigned represents and warrants to Secured Party that:

(a)           all of the Equipment, Inventory and Goods owned by such Debtor is
located at the places as specified on Schedule I and such Debtor conducts
business in the jurisdiction set forth on Schedule I;

(b)           except as disclosed on Schedule I, none of such Collateral is in
the possession of any bailee, warehousemen, processor or consignee;

(c)           the chief place of business, chief executive office and the office
where such Debtor keeps its books and records are located at the place specified
on Schedule I;

(d)           such Debtor (including any Person acquired by such Debtor) does
not do business or has not done business during the past five years under any
tradename or fictitious business name, except as disclosed on Schedule II;

(e)           all Copyrights, Patents and Trademarks owned or licensed by the
undersigned are listed in Schedules III, IV and V, respectively;

(f)           all Deposit Accounts, securities accounts, brokerage accounts and
other similar accounts maintained by such Debtor, and the financial institutions
at which such accounts are maintained, are listed on Schedule VI;

(g)           all Commercial Tort Claims of such Debtor are listed on Schedule
VII;

(h)           all interests in real property held by such Debtor are listed on
Schedule VIII;

(i)           all Equipment (including Motor Vehicles) owned by such debtor are
listed on Schedule IX; and

(j)           all other representations and warranties made by the Debtors in
the Security Agreement are true, complete and correct in all respects as of the
date hereof.

 

  ________________, a _____ corporation  
By:___________________________
  Title:__________________________   FEIN:__________________________

 
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SCHEDULE I
TO
SECURITY AGREEMENT

UCC Financing Statements; Location of Equipment, Inventory, Goods and Books and
Records; Goods in Possession of Consignees, Bailees, Warehousemen, Agents and
Processors; Debtors’ Legal Names; State of Incorporation; Organizational
Identification Number; Chief Executive Office.

I.           DEBTOR:

1
Legal Name of Debtor:
       
2
State of Incorporation:
       
3
Organizational Identification Number:
       
4
Chief Executive Office:
       
5
Location of Books and Records:
       
6
Locations of Equipment, Inventory and Goods:
       
7
Locations of Goods in Possession of Consignees, Bailees, Warehousemen, Agents
and Processors (including names of such consignees, bailees, etc.):
     
8
Jurisdictions For UCC Filings:
 

 
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SCHEDULE II
TO
SECURITY AGREEMENT

Tradenames and Fictitious Names
(Present and Past Five Years)

1.
   
2.
   

 
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SCHEDULE III
TO
SECURITY AGREEMENT

U.S. Copyright Registrations; Foreign Copyright Registrations; U.S. Copyright
Applications; Foreign Copyright Applications; Copyright Licenses

U.S. Copyright Registrations

Foreign Copyright Registrations

U.S. Copyright Applications

Foreign Copyright Applications

Copyright Licenses
 
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SCHEDULE IV
TO
SECURITY AGREEMENT

U.S. Patent Registrations; Foreign Patent Registrations; U.S. Patent
Applications; Foreign Patent Applications; Patent Licenses

U.S. Patent Registrations

Foreign Patent Registrations

U.S. Patent Applications

Foreign Patent Applications

Patent Licenses
 
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SCHEDULE V
TO
SECURITY AGREEMENT

U.S. Trademark Registrations; Foreign Trademark Registrations; U.S. Trademark
Applications; Foreign Trademark Applications; Trademark Licenses

U.S. Trademark Registrations

Foreign Trademark Registrations

U.S. Trademark Applications

Foreign Trademark Applications

Trademark Licenses
 
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SCHEDULE VI
TO
SECURITY AGREEMENT

Depository Accounts and Other Accounts

Name of Account Holder
Bank
Type of Account (with general description)
Account Number
       

 
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SCHEDULE VII
TO
SECURITY AGREEMENT

Commercial Tort Claims
 
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SCHEDULE VIII
TO
SECURITY AGREEMENT

Interests in Real Property
 
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SCHEDULE IX
TO
SECURITY AGREEMENT

Titled Equipment

[To be completed]