Exhibit 10.2

 

EXECUTION COPY

 

SECURITY AND PLEDGE AGREEMENT

 

THIS SECURITY AND PLEDGE AGREEMENT (this “Agreement”) is entered into as of
July 18, 2013 among NEWPORT CORPORATION, a Nevada corporation (the “Borrower”),
the other parties identified as “Obligors” on the signature pages hereto and
such other parties that may become Obligors hereunder after the date hereof
(together with the Borrower, individually an “Obligor”, and collectively the
“Obligors”) and JPMORGAN CHASE BANK, N.A., in its capacity as administrative
agent (in such capacity, the “Administrative Agent”) for the Secured Parties.

 

RECITALS

 

WHEREAS, pursuant to that certain Credit Agreement, dated as of the date hereof
(as amended, modified, supplemented, increased, extended, restated, renewed,
refinanced or replaced from time to time, the “Credit Agreement”) among the
Borrower, the Lenders identified therein and the Administrative Agent, the
Lenders have agreed to make Loans and issue Letters of Credit upon the terms and
subject to the conditions set forth therein; and

 

WHEREAS, this Agreement is required by the terms of the Credit Agreement.

 

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

 

1.                                      Definitions.

 

(a)                                 Capitalized terms used and not otherwise
defined herein shall have the meanings ascribed to such terms in the Credit
Agreement, and the following terms shall have the meanings set forth in the UCC
(defined below):  Accession, Account, Adverse Claim, As-Extracted Collateral,
Chattel Paper, Commercial Tort Claim, Consumer Goods, Deposit Account, Document,
Electronic Chattel Paper, Equipment, Farm Products, Fixtures, General
Intangible, Goods, Instrument, Inventory, Investment Company
Security, Investment Property, Letter-of-Credit Right, Manufactured Home, Money,
Proceeds, Securities Account, Securities Intermediary, Security Entitlement,
Security, Software, Supporting Obligation and Tangible Chattel Paper.

 

(b)                                 In addition, the following terms shall have
the meanings set forth below:

 

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

 

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

 

“Copyrights” means (a) all registered United States copyrights in all Works, now
existing or hereafter created or acquired, all registrations and recordings
thereof, and all applications in connection therewith, including, without
limitation, registrations, recordings and applications in the United States
Copyright Office, and (b) all renewals thereof.

 

“Excluded Accounts” shall mean, collectively, any deposit account, securities
account or other disbursement account which (a) is used exclusively for the
payment of payroll, payroll taxes, salary, benefits, trust, employee benefits,
withholding or escrow or fiduciary deposits, (b) is used solely as a zero
balance disbursement account or (c) contains, at all times, less than $500,000
for any one account and $1,000,000 in the aggregate for all such accounts.

 

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

 

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

 

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

 

“Pledged Equity” means, with respect to each Obligor, (i) 100% of the issued and
outstanding Equity Interests of each Domestic Subsidiary (other than a Foreign
Holding Company or Disregarded Entity that owns an interest in a CFC or CFC
Debt) and each Foreign Subsidiary that is a Disregarded Entity and that does not
own an interest in a CFC or CFC Debt, in each case directly owned by such
Obligor, (ii) 65% of the issued and outstanding Equity Interests entitled to
vote (within the meaning of Treas. Reg. Section 1.956-2(c)(2)) in each Foreign
Subsidiary and Foreign Holding Company, in each case other than a Disregarded
Entity, (iii) 65% of the issued and outstanding Equity Interests in each
Disregarded Entity that owns an interest in a CFC or CFC Debt, and (iv) 100% of
the issued and outstanding Equity Interests not entitled to vote (within the
meaning of Treas. Reg. Section 1.956-2(c)(2)) in each Foreign Subsidiary and
each Foreign Holding Company, in each case other than a Disregarded Entity,
directly owned by such Obligor, including the Equity Interests of the
Subsidiaries owned by such Obligor to the extent set forth on
Schedule 1(b) hereto, in each case together with the certificates (or other
agreements or instruments), if any, representing such shares, and all options
and other rights, contractual or otherwise, with respect thereto, including, but
not limited to, the following (subject however to the limitations noted above):

 

(1)                                 all Equity Interests representing a dividend
thereon, or representing a distribution or return of capital upon or in respect
thereof, or resulting from a stock split, revision, reclassification or other
exchange therefor, and any subscriptions, warrants, rights or options issued to
the holder thereof, or otherwise in respect thereof, in each case to the extent
provided in clauses (i) and (ii) above; and

 

(2)                                 in the event of any consolidation or merger
involving the issuer thereof and in which such issuer is not the surviving
Person, all shares of each class of the Equity Interests of the successor Person
formed by or resulting from such consolidation or merger, to the extent that
such successor Person is a direct Subsidiary of an Obligor, in each case to the
extent provided in clauses (i) and (ii) above.

 

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

 

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

 

2

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

 

“UCC” means the Uniform Commercial Code as in effect from time to time in the
state of New York except as such term may be used in connection with the
perfection of the Collateral and then the applicable jurisdiction with respect
to such affected Collateral shall apply.

 

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

 

2.                                      Grant of Security Interest in the
Collateral.  To secure the prompt payment and performance in full when due,
whether by lapse of time, acceleration, mandatory prepayment or otherwise, of
the Secured Obligations, each Obligor hereby grants, pledges and assigns to the
Administrative Agent, for the benefit of the Secured Parties, a continuing
security interest in, and a right to set off against, any and all right, title
and interest of such Obligor in and to all of the following, whether now owned
or existing or owned, acquired, or arising hereafter (collectively, the
“Collateral”):  (a) all Accounts; (b) all Chattel Paper; (c) those certain
Commercial Tort Claims set forth on Schedule 2(c) hereto; (d) all Copyrights;
(e) all Copyright Licenses; (f) all Deposit Accounts; (g) all Documents; (h) all
Equipment; (i) all Fixtures; (j) all General Intangibles; (k) all Instruments;
(l) all Inventory; (m) all Investment Property; (n) all Letter-of-Credit Rights;
(o) all Money; (p) all Patents; (q) all Patent Licenses; (r) all Pledged Equity;
(s) all Software; (t) all Supporting Obligations; (u) all Trademarks; (v) all
Trademark Licenses; and (w) all Accessions and all Proceeds of any and all of
the foregoing.

 

Notwithstanding anything to the contrary contained herein, the security
interests granted under this Agreement shall not extend to (i) any property
which, subject to the terms of Section 6.09 of the Credit Agreement, is subject
to a Lien of the type described in Section 6.01(i) of the Credit Agreement
pursuant to documents which prohibit such Obligor from granting any other Liens
in such property, (ii) any General Intangible, permit, lease, license, contract
or other Instrument of an Obligor to the extent the grant of a security interest
in such General Intangible, permit, lease, license, contract or other Instrument
in the manner contemplated by this Agreement, under the terms thereof or under
applicable Law, is prohibited and would result in the termination thereof or
give the other parties thereto the right to terminate, accelerate or otherwise
alter such Obligor’s rights, titles and interests thereunder (including upon the
giving of notice or the lapse of time or both); provided that (a) any such
limitation described in the foregoing clause (ii) on the security interests
granted hereunder shall only apply to the extent that any such prohibition could
not be rendered ineffective pursuant to the UCC or any other applicable Law
(including Debtor Relief Laws) or principles of equity and (b) in the event of
the termination or elimination of any such prohibition or the requirement for
any consent contained in any applicable Law, General Intangible, permit, lease,
license, contract or other Instrument, to the extent sufficient to permit any
such item to become Collateral hereunder, or upon the granting of any such
consent, or waiving or terminating any requirement for such consent, a security
interest in such General Intangible, permit, lease, license, contract or other
Instrument shall be automatically and simultaneously granted hereunder and shall
be included as Collateral hereunder, (iii) any United States trademark
application filed on the basis of an Obligor’s intent-to-use such mark, in each
case, unless and until evidence of the use of such trademark in interstate
commerce is submitted to the United States Patent and Trademark Office but only
if and to the extent that the granting of a security interest in such
application would result in the invalidation of such application or resulting
registration, provided, that, to the extent such application is excluded from
the Collateral, upon the submission of evidence of use of such trademark to the
United States Patent and Trademark Office, such trademark application shall
automatically be included in the Collateral, without further action on any
party’s part and (iv) any Excluded Property.

 

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

 

3

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

 

3.                                      Representations and Warranties.  Each
Obligor hereby represents and warrants to the Administrative Agent, for the
benefit of the Secured Parties, that:

 

(a)                                 Ownership, Authorization, Validity and
Enforceability.  Each Obligor is the legal and beneficial owner of its
Collateral and has the right to pledge, sell, assign or transfer the same, and
has the full corporate, limited liability company or partnership, as applicable,
power and authority to grant to the Administrative Agent the security interest
in such Collateral pursuant hereto.  To the best of such Obligor’s knowledge,
there exists no Adverse Claim with respect to the Pledged Equity of such
Obligor.  This Agreement has been duly executed and delivered by each Obligor
that is party hereto.  This Agreement constitutes a legal, valid and binding
obligation of each Obligor that is party hereto, enforceable against each such
Obligor in accordance with its terms.

 

(b)                                 Security Interest/Priority.  This Agreement
creates a valid security interest in favor of the Administrative Agent, for the
benefit of the Secured Parties, in the Collateral of such Obligor and, when
properly perfected by filing, shall constitute a valid and perfected security
interest in such Collateral (including all uncertificated Pledged Equity that do
not constitute Securities), to the extent such security interest can be
perfected by filing under the UCC, free and clear of all Liens except for
Permitted Liens.  The taking possession by the Administrative Agent of the
certificated securities (if any) evidencing the Pledged Equity and all other
Instruments constituting Collateral will perfect and establish the first
priority of the Administrative Agent’s security interest in all the Pledged
Equity evidenced by such certificated securities and such Instruments.  With
respect to any Collateral consisting of a Deposit Account, Securities
Entitlement or held in a Securities Account, upon execution and delivery by the
applicable Obligor, the applicable Securities Intermediary and the
Administrative Agent of an agreement granting control to the Administrative
Agent over such Collateral, the Administrative Agent shall have a valid and
perfected security interest in such Collateral, free and clear of all Liens
except for Permitted Liens.

 

(c)                                  Types of Collateral.  None of the
Collateral consists of, or is the Proceeds of, As-Extracted Collateral, Consumer
Goods, Farm Products, Manufactured Homes or standing timber.

 

(d)                                 Accounts.  (i) Each Account of the Obligors
and the papers and documents relating thereto are genuine and in all material
respects what they purport to be, (ii) each Account arises out of (A) a bona
fide sale of goods sold and delivered by such Obligor (or is in the process of
being delivered) or (B) services theretofore actually rendered by such Obligor
to, the account debtor named therein, (iii) no Account of an Obligor is
evidenced by any Instrument or Chattel Paper unless such Instrument or Chattel
Paper, to the extent requested by the Administrative Agent (subject to
Section 4(a)), has been endorsed over and delivered to, or submitted to the
control of, the Administrative Agent and (iv) the right to receive payment under
each Account is assignable after giving effect to the UCC.

 

(e)                                  No Contravention.  Neither the execution,
delivery and performance by each Obligor of this Agreement, the creation and
perfection of the security interest in the Collateral granted hereunder, nor
compliance with the terms and provisions hereof will (a) contravene the terms of
any of such Person’s Organization Documents; (b) conflict with or result in any
breach or contravention of, or the creation of any Lien under, or require any
payment to be made under (i) any material Contractual Obligation to which such
Person is a party or affecting such Person or the properties of such Person or
any of its Subsidiaries (other than any Lien of the Administrative Agent on
behalf of the Secured Parties) or (ii) any material order, injunction, writ or
decree of any Governmental Authority or any arbitral award to which such Person
or its property is subject; or (c) violate any Law.

 

4

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

 

(f)                                   Authorization of Pledged Equity.  All
Pledged Equity is duly authorized and validly issued, is fully paid and, to the
extent applicable (other than any such Pledged Equity that constitutes a limited
liability company interest or other analogous equity interest), nonassessable.

 

(g)                                  No Other Equity
Interests, Instruments, Etc.   (i) No Obligor owns any certificated Equity
Interests in any Subsidiary that are required to be pledged and delivered to the
Administrative Agent hereunder except as set forth on Schedule 1(b) hereto, and
(ii) no Obligor holds any Instruments, Documents or Tangible Chattel Paper
required to be pledged and delivered to the Administrative Agent pursuant to
Section 4(a)(i) of this Agreement other than as set forth on Schedule
3(g) hereto.  All such certificated Equity Interests, securities, Instruments,
Documents and Tangible Chattel Paper have been delivered to the Administrative
Agent.

 

(h)                                 Pledged Equity.  Except as previously
disclosed to the Administrative Agent, none of the uncertificated Pledged Equity
(i) is dealt in or traded on a securities exchange or in a securities market,
(ii) by its terms expressly provides that it is a Security governed by Article 8
of the UCC, (iii) is an Investment Company Security, (iv) is held in a
Securities Account or (v) constitutes a Security.

 

(i)                                     [Intentionally Omitted].

 

(j)                                    Consents; Etc.  Except for Pledged Equity
of Subsidiaries that is acquired pursuant to Permitted Acquisitions, provided
that (x) such Subsidiary was not created in anticipation of such Permitted
Acquisition and (y) such restrictions were not created in anticipation of such
Permitted Acquisition, there are no restrictions in any Organization Document
governing any Pledged Equity or any other document related thereto which would
limit or restrict (i) the grant of a Lien pursuant to this Agreement on such
Pledged Equity, (ii) the perfection of such Lien or (iii) the exercise of
remedies in respect of such perfected Lien in the Pledged Equity as contemplated
by this Agreement.  Except for (i) the filing or recording of UCC financing
statements, (ii) the filing of appropriate notices with the United States Patent
and Trademark Office and the United States Copyright Office, (iii) obtaining
control to perfect the Liens created by this Agreement (to the extent required
under Section 4(a) hereof), (iv) such actions as may be required by Laws
affecting the offering and sale of securities, (v) such actions as may be
required by applicable foreign Laws affecting the pledge of the Pledged Equity
of Foreign Subsidiaries and (vi) consents, authorizations, filings or other
actions which have been obtained or made, no consent or authorization of, filing
with, or other act by or in respect of, any arbitrator or Governmental Authority
and no consent of any other Person (including, without limitation, any
stockholder, member or creditor of such Obligor), is required for (A) the grant
by such Obligor of the security interest in the Collateral granted hereby or for
the execution, delivery or performance of this Agreement by such Obligor,
(B) the perfection of such security interest (to the extent such security
interest can be perfected by filing under the UCC, the granting of control (to
the extent required under Section 4(a) hereof) or by filing an appropriate
notice with the United States Patent and Trademark Office or the United States
Copyright Office) or (C) the exercise by the Administrative Agent or the Secured
Parties of the rights and remedies provided for in this Agreement.

 

(k)                                 Commercial Tort Claims.  As of the Closing
Date, no Obligor has any Commercial Tort Claims seeking damages in excess of
$500,000 as to which such Obligor has elected to pursue such claim other than as
set forth on Schedule 2(c) hereto.

 

5

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

 

(l)                                     Copyrights, Patents and Trademarks.

 

(i)                                     To the best of each Obligor’s knowledge,
each Copyright, Patent and Trademark of such Obligor that is material to the
business of the Obligors taken as a whole is valid, subsisting, unexpired,
enforceable and has not been abandoned.

 

(ii)                                  To the best of each Obligor’s knowledge,
no holding, decision or judgment has been rendered by any Governmental Authority
that would limit, cancel or question the validity of any Copyright, Patent or
Trademark of any Obligor that is material to the business of the Obligors taken
as a whole.

 

(iii)                               No action or proceeding is pending seeking
to limit, cancel or question the validity of any Copyright, Patent or Trademark
of any Obligor, or that could reasonably be expected to have a material adverse
effect on the value of any Copyright, Patent or Trademark of any Obligor that is
material to the business of the Obligors taken as a whole.

 

(iv)                              All applications pertaining to the Copyrights,
Patents and Trademarks of each Obligor that are material to the business of the
Obligors taken as a whole have been duly and properly filed, and all
registrations or letters pertaining to such Copyrights, Patents and Trademarks
have been duly and properly filed and issued.

 

(v)                                 No Obligor has made any assignment or
agreement in conflict with the security interest in the Copyrights, Patents or
Trademarks of any Obligor that are material to the business of the Obligors
taken as a whole hereunder (except as permitted under the Credit Agreement or
hereunder).

 

4.                                      Covenants. Each Obligor covenants that
until such time as the Secured Obligations arising under the Loan Documents have
been paid in full in cash (other than (x) contingent indemnification obligations
for which no claim has been asserted and (y) Swap Obligations or Banking
Services Obligations) and the Commitments have expired or been terminated, such
Obligor shall:

 

(a)                                 Instruments/Chattel Paper/Pledged
Equity/Control.

 

(i)  If any amount in excess of $250,000 payable under or in connection with any
of the Collateral shall be or become evidenced by any Instrument or Tangible
Chattel Paper, or if any property constituting Collateral shall be stored or
shipped subject to a Document, ensure that such Instrument, Tangible Chattel
Paper or Document is either in the possession of such Obligor at all times or,
if requested by the Required Lenders to perfect the Administrative Agent’s
security interest in such Collateral, is delivered to the Administrative Agent
duly endorsed in a manner satisfactory to the Administrative Agent.  Such
Obligor shall ensure that any Collateral consisting of Tangible Chattel Paper in
excess of $250,000 individually or $1,000,000 in the aggregate is marked with a
legend acceptable to the Administrative Agent indicating the Administrative
Agent’s security interest in such Tangible Chattel Paper.

 

(ii)  Deliver to the Administrative Agent within thirty (30) Business Days of
the receipt thereof by or on behalf of an Obligor, all certificates and
instruments constituting Pledged Equity.  Prior to delivery to the
Administrative Agent, all such certificates constituting Pledged Equity shall be
held in trust by such Obligor for the benefit of the Administrative Agent
pursuant hereto.  All such certificates representing Pledged Equity shall be
delivered in suitable form for transfer by delivery or shall be accompanied by
duly executed instruments of transfer or assignment in blank, substantially in
the form provided in Exhibit 4(a)(ii) hereto.

 

6

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

 

(iii)  Execute and deliver all agreements, assignments, instruments or other
documents as reasonably requested by the Required Lenders for the purpose of
obtaining and maintaining control with respect to any Collateral consisting of
(i) Deposit Accounts (other than Excluded Accounts), (ii) Investment Property,
(iii) Letter-of-Credit Rights and (iv) Electronic Chattel Paper.

 

(b)                                 Filing of Financing Statements,
Notices, etc.  Each Obligor shall execute and deliver to the Administrative
Agent such agreements, assignments or instruments (including affidavits,
notices, reaffirmations and amendments and restatements of existing documents,
as the Administrative Agent may reasonably request) and do all such other things
as the Administrative Agent may reasonably deem necessary or appropriate (i) to
assure to the Administrative Agent its security interests hereunder, including
(A) such instruments as the Administrative Agent may from time to time
reasonably request in order to perfect and maintain the security interests
granted hereunder in accordance with the UCC, (B) with regard to registered
Patents and pending applications, a Notice of Grant of Security Interest in
Patents for filing with the United States Patent and Trademark Office in the
form of Exhibit 4(b)(i) hereto, (C) with regard to registered Trademarks and
pending applications, a Notice of Grant of Security Interest in Trademarks for
filing with the United States Patent and Trademark Office in the form of
Exhibit 4(b)(ii) hereto and (D) with regard to registered Copyrights, a Notice
of Grant of Security Interest in Copyrights in the form of
Exhibit 4(b)(iii) hereto (ii) to consummate the transactions contemplated hereby
and (iii) to otherwise protect and assure the Administrative Agent of its rights
and interests hereunder.  Furthermore, each Obligor also hereby irrevocably
makes, constitutes and appoints the Administrative Agent, its nominee or any
other person whom the Administrative Agent may designate, as such Obligor’s
attorney in fact with full power and for the limited purpose to sign in the name
of such Obligor any financing statements, or amendments and supplements to
financing statements, renewal financing statements, notices or any similar
documents which in the Administrative Agent’s reasonable discretion would be
necessary or appropriate in order to perfect and maintain perfection of the
security interests granted hereunder (except with respect to Excluded Property),
such power, being coupled with an interest, being and remaining irrevocable
until such time as the Secured Obligations arising under the Loan Documents have
been paid in full (other than contingent indemnification obligations for which
no claim has been made) and the Commitments have expired or been terminated. 
Each Obligor hereby agrees that a carbon, photographic or other reproduction of
this Agreement or any such financing statement is sufficient for filing as a
financing statement by the Administrative Agent without notice thereof to such
Obligor wherever the Administrative Agent may reasonably deem it necessary or
appropriate to file the same.

 

(c)                                  Collateral Held by Warehouseman,
Bailee, etc.  If any Collateral exceeding a value of $5,000,000 is at any time
in the possession or control of a warehouseman, bailee or any agent or processor
of such Obligor and the Administrative Agent so requests (i) notify such Person
in writing of the Administrative Agent’s security interest therein,
(ii) instruct such Person to hold all such Collateral for the Administrative
Agent’s account and subject to the Administrative Agent’s instructions and
(iii) use commercially reasonable efforts to obtain a written acknowledgment
from such Person that it is holding such Collateral for the benefit of the
Administrative Agent.

 

(d)                                 Treatment of Accounts.  Not grant or extend
the time for payment of any Account, or compromise or settle any Account for
less than the full amount thereof, or release any person or property, in whole
or in part, from payment thereof, or allow any credit or discount thereon, other
than as normal and customary in the ordinary course of an Obligor’s business or
as would not reasonably be expected to have a Material Adverse Effect.

 

7

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

 

(e)                                  Commercial Tort Claims.  (i) Concurrently
with the delivery of the Compliance Certificate pursuant to Section 5.02(b) of
the Credit Agreement, forward to the Administrative Agent an updated Schedule
2(c) listing any and all Commercial Tort Claims by or in favor of such Obligor
seeking damages in excess of $500,000 as to which such Obligor has elected to
pursue such claim and (ii) execute and deliver such statements, documents and
notices and do and cause to be done all such things as may be required by the
Administrative Agent, or required by Law to create, preserve, perfect and
maintain the Administrative Agent’s security interest in any Commercial Tort
Claims initiated by or in favor of any Obligor.

 

(f)                                   Books and Records.  Upon the request of
the Required Lenders, mark its books and records (and shall cause the issuer of
the Pledged Equity of such Obligor to mark its books and records) to reflect the
security interest granted pursuant to this Agreement.

 

(g)                                  Nature of Collateral.  At all times
maintain the Collateral as personal property and not affix any material portion
of the Collateral to any real property in a manner which would change its nature
from personal property to real property or a Fixture to real property, unless
the Administrative Agent shall have a perfected Lien on such Fixture or real
property.

 

(h)                                 Issuance or Acquisition of Uncertificated
Equity Interests.  Not without executing and delivering, or causing to be
executed and delivered, to the Administrative Agent such agreements, documents
and instruments as the Administrative Agent may reasonably require, issue or
acquire any uncertificated Pledged Equity that (i) is dealt in or traded on a
securities exchange or in a securities market, (ii) by its terms expressly
provides that it is a Security governed by Article 8 of the UCC, (iii) is an
Investment Company Security, (iv) is held in a Securities Account or
(v) constitutes a Security.

 

(i)                                     Intellectual Property.

 

(i)                                     Not do any act or omit to do any act
whereby any Copyright that is material to the business of the Obligors taken as
a whole may become invalidated and (A) not do any act, or omit to do any act,
whereby any Copyright that is material to the business of the Obligors taken as
a whole may become injected into the public domain; (B) notify the
Administrative Agent immediately if it knows that any Copyright that is material
to the business of the Obligors taken as a whole may become injected into the
public domain or of any materially adverse determination or development
(including, without limitation, the institution of, or any such determination or
development in, any court or tribunal in the United States or any other country)
regarding an Obligor’s ownership of any such Copyright or its validity; (C) take
all necessary steps as it shall deem appropriate under the circumstances, to
maintain and pursue each application (and to obtain the relevant registration)
of each Copyright owned by an Obligor that is material to the business of the
Obligors taken as a whole and to maintain each registration of each material
Copyright owned by an Obligor including, without limitation, filing of
applications for renewal where necessary; and (D) promptly notify the
Administrative Agent of any material infringement of any Copyright of an Obligor
that is material to the business of the Obligors taken as a whole of which it
becomes aware and take such actions as it shall reasonably deem appropriate
under the circumstances to protect such Copyright, including, where appropriate,
the bringing of suit for infringement, seeking injunctive relief and seeking to
recover any and all damages for such infringement.

 

8

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

 

(ii)                                  Not make any assignment or agreement in
conflict with the security interest in the Copyrights of each Obligor hereunder
(except as permitted by the Credit Agreement).

 

(iii)                               (A) Continue to use each Trademark that is
material to the business of the Obligors taken as a whole on each and every
trademark class of goods applicable to its current line as reflected in its
current catalogs, brochures and price lists in order to maintain such Trademark
in full force free from any claim of abandonment for non-use, (B) maintain as in
the past the quality of products and services offered under such Trademark,
(C) employ such Trademark with the appropriate notice of registration, if
applicable, (D) not adopt or use any mark that is confusingly similar or a
colorable imitation of such Trademark; provided that the Borrower may adopt or
use such mark so long as the Borrower notifies the Administrative Agent of such
mark concurrently with the delivery of the Compliance Certificate pursuant to
Section 5.02(b) of the Credit Agreement so that the Administrative Agent, for
the ratable benefit of the Secured Parties, may obtain a perfected security
interest in such mark pursuant to this Agreement, and (E) use commercially
reasonable efforts not to (and not to permit any licensee or sublicensee thereof
to) do any act or omit to do any act whereby any such Trademark may become
invalidated.

 

(iv)                              Not do any act, or omit to do any act, whereby
any Patent that is material to the business of the Obligors taken as a whole may
become abandoned or dedicated.

 

(v)                                 Notify the Administrative Agent concurrently
with the delivery of the Compliance Certificate pursuant to Section 5.02(b) of
the Credit Agreement if it knows that any application or registration relating
to any Patent or Trademark that is material to the business of the Obligors
taken as a whole may become abandoned or dedicated, or of any materially adverse
determination or development (including, without limitation, the institution of,
or any such determination or development in, any proceeding in the United States
Patent and Trademark Office or any court or tribunal in any country) regarding
such Obligor’s ownership of any Patent or Trademark that is material to the
business of the Obligors taken as a whole or its right to register the same or
to keep and maintain the same.

 

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

 

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

 

9

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

 

(viii)                        Not make any assignment or agreement in conflict
with the security interest in the Patents or Trademarks of each Obligor
hereunder (except as permitted by the Credit Agreement).

 

Notwithstanding the foregoing, the Obligors may, in their reasonable business
judgment, fail to maintain, pursue, preserve or protect any Copyright, Patent or
Trademark which is not material to their businesses taken as a whole.

 

(j)                                    Notification of Default.  Each Obligor
will give prompt notice in writing to the Administrative Agent of the occurrence
of any Event of Default and of any other development, financial or otherwise,
which could reasonably be expected to materially and adversely affect a material
portion of the Collateral taken as a whole.

 

(k)                                 Change in Corporate Existence, Type or
Jurisdiction of Organization, Location, Name.  Each Obligor will:

 

(i)                                     preserve its legal existence under the
Laws of its jurisdiction of its organization other than as permitted by the
Credit Agreement;

 

(ii)                                  not change its name or jurisdiction of
organization; and

 

(iii)                               not maintain its place of business (if it
has only one) or its chief executive office (if it has more than one place of
business) at a location other than the location in effect on the Effective Date;

 

unless, in each such case, such Obligor shall have given the Administrative
Agent not less than ten (10) days’ prior written notice of such event or
occurrence (or, in the case of clause (iii) above, such Obligor shall have given
the Administrative Agent written notice thereof not more than thirty (30) days
after such event or occurrence) and either (x) such event or occurrence will not
adversely affect the validity, perfection or priority of the Administrative
Agent’s security interest in the Collateral, or (y) the Administrative Agent
shall have taken such steps (with the cooperation of such Obligor to the extent
necessary or advisable) as are necessary or advisable to properly maintain the
validity, perfection and priority of the Administrative Agent’s security
interest in the Collateral owned by such Obligor.

 

(l)                                     Other Financing Statements.  No Obligor
will suffer to exist or authorize the filing of any financing statement naming
it as debtor covering all or any portion of the Collateral owned by such
Obligor, except any financing statement authorized under this Agreement or any
Permitted Lien.  Each Obligor acknowledges that it is not authorized to file any
financing statement or amendment or termination statement with respect to any
financing statement filed in connection herewith without the prior written
consent of the Administrative Agent, subject to such Obligor’s rights under
Section 9-509(d)(2) of the UCC.

 

5.                                      Authorization to File Financing
Statements.  Each Obligor hereby authorizes the Administrative Agent to prepare
and file such financing statements (including continuation statements) or
amendments thereof or supplements thereto or other instruments as the
Administrative Agent may from time to time deem necessary or appropriate in
order to perfect and maintain the security interests granted hereunder in
accordance with the UCC (including authorization to describe the Collateral as
“all personal property”, “all assets” or words of similar meaning).

 

10

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

 

6.                                      Advances.  (i) Upon the occurrence and
continuance of an Event of Default, with prompt written notice thereafter to the
Obligors, or (ii) upon the occurrence and continuance of a Default (that has not
matured into an Event of Default), after the Administrative Agent has provided
prior written notice to the Obligors and the Obligors have failed to act within
a reasonable period of time thereafter, if with respect to this clause (ii), the
Administrative Agent reasonably determines that the taking of a particular
action is required prior to the expiration of any applicable cure period(s) in
order to prevent an impairment of its rights in and to any Collateral, then in
either case, the Administrative Agent may, at its sole option and in its sole
discretion, perform the same and in so doing may expend such sums as the
Administrative Agent may reasonably deem advisable in the performance thereof,
including, without limitation, the payment of any insurance premiums, the
payment of any taxes, a payment to obtain a release of a Lien or potential Lien,
expenditures made in defending against any adverse claim and all other
expenditures which the Administrative Agent may make for the protection of the
security hereof or which may be compelled to make by operation of Law.  All such
sums and amounts so expended shall be repayable by the Obligors on a joint and
several basis promptly upon timely notice thereof and demand therefor, shall
constitute additional Secured Obligations and shall bear interest from the date
said amounts are expended at a rate per annum equal to 2% plus the rate
applicable to ABR Loans.  No such performance of any covenant or agreement by
the Administrative Agent on behalf of any Obligor, and no such advance or
expenditure therefor, shall relieve the Obligors of any Default or Event of
Default.  The Administrative Agent may make any payment hereby authorized in
accordance with any bill, statement or estimate procured from the appropriate
public office or holder of the claim to be discharged without inquiry into the
accuracy of such bill, statement or estimate or into the validity of any tax
assessment, sale, forfeiture, tax lien, title or claim except to the extent such
payment is being contested in good faith by an Obligor in appropriate
proceedings and against which adequate reserves are being maintained in
accordance with GAAP.

 

7.                                      Remedies.

 

(a)                                 General Remedies.  Upon the occurrence of an
Event of Default and during continuation thereof, the Administrative Agent shall
have, in addition to the rights and remedies provided herein, in the Loan
Documents, in any other documents relating to the Secured Obligations, or by Law
(including, but not limited to, levy of attachment, garnishment and the rights
and remedies set forth in the UCC of the jurisdiction applicable to the affected
Collateral), the rights and remedies of a secured party under the UCC
(regardless of whether the UCC is the law of the jurisdiction where the rights
and remedies are asserted and regardless of whether the UCC applies to the
affected Collateral), and further, the Administrative Agent may, with or without
judicial process or the aid and assistance of others, (i) enter on any premises
on which any of the Collateral may be located and, without resistance or
interference by the Obligors, take possession of the Collateral, (ii) dispose of
any Collateral on any such premises, (iii) require the Obligors to assemble and
make available to the Administrative Agent at the expense of the Obligors any
Collateral at any place and time designated by the Administrative Agent which is
reasonably convenient to both parties, (iv) remove any Collateral from any such
premises for the purpose of effecting sale or other disposition thereof, and/or
(v) without demand and without advertisement, notice, hearing or process of law,
all of which each of the Obligors hereby waives to the fullest extent permitted
by Law, at any place and time or times, sell and deliver any or all Collateral
held by or for it at public or private sale (which in the case of a private sale
of Pledged Equity, shall be to a restricted group of purchasers who will be
obligated to agree, among other things, to acquire such securities for their own
account, for investment and not with a view to the distribution or resale
thereof), at any exchange or broker’s board or elsewhere, by one or more
contracts, in one or more parcels, for Money, upon credit or otherwise, at such
prices and upon such terms as the Administrative Agent deems advisable, in its
sole discretion (subject to any and all mandatory legal requirements). Each
Obligor acknowledges that any such private sale may be at prices and on terms
less favorable to the seller than the prices and other terms which might have
been obtained at a public sale and, notwithstanding the foregoing, agrees that
such private sale shall be deemed to have been made in a commercially reasonable
manner and, in the case of a sale of Pledged Equity, that the Administrative
Agent

 

11

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

 

shall have no obligation to delay sale of any such securities for the period of
time necessary to permit the issuer of such securities to register such
securities for public sale under the Securities Act of 1933, as amended. 
Neither the Administrative Agent’s compliance with applicable Law nor its
disclaimer of warranties relating to the Collateral shall be considered to
adversely affect the commercial reasonableness of any sale.  To the extent the
rights of notice cannot be legally waived hereunder, each Obligor agrees that
any requirement of reasonable notice shall be met if such notice, specifying the
place of any public sale or the time after which any private sale is to be made,
is personally served on or mailed, postage prepaid, to the Borrower in
accordance with the notice provisions of Section 9.01 of the Credit Agreement at
least 10 days before the time of sale or other event giving rise to the
requirement of such notice.  The Administrative Agent may adjourn any public or
private sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the time and
place to which it was so adjourned.  Each Obligor further acknowledges and
agrees that any offer to sell any Pledged Equity which has been (i) publicly
advertised on a bona fide basis in a newspaper or other publication of general
circulation in the financial community of New York, New York (to the extent that
such offer may be advertised without prior registration under the Securities Act
of 1933, as amended), or (ii) made privately in the manner described above shall
be deemed to involve a “public sale” under the UCC, notwithstanding that such
sale may not constitute a “public offering” under the Securities Act of 1933, as
amended, and the Administrative Agent may, in such event, bid for the purchase
of such securities.  The Administrative Agent shall not be obligated to make any
sale or other disposition of the Collateral regardless of notice having been
given.  To the extent permitted by applicable Law, any Secured Party may be a
purchaser at any such sale.  To the extent permitted by applicable Law, each of
the Obligors hereby waives all of its rights of redemption with respect to any
such sale.  Subject to the provisions of applicable Law, the Administrative
Agent may postpone or cause the postponement of the sale of all or any portion
of the Collateral by announcement at the time and place of such sale, and such
sale may, without further notice, to the extent permitted by Law, be made at the
time and place to which the sale was postponed, or the Administrative Agent may
further postpone such sale by announcement made at such time and place.

 

(b)                                 Remedies Relating to Accounts.  During the
continuation of an Event of Default, whether or not the Administrative Agent has
exercised any or all of its rights and remedies hereunder, (i) each Obligor will
promptly upon request of the Administrative Agent instruct all account debtors
to remit all payments in respect of Accounts to a mailing location selected by
the Administrative Agent and (ii) the Administrative Agent shall have the right
to enforce any Obligor’s rights against its customers and account debtors, and
the Administrative Agent or its designee may notify any Obligor’s customers and
account debtors that the Accounts of such Obligor have been assigned to the
Administrative Agent or of the Administrative Agent’s security interest therein,
and may (either in its own name or in the name of an Obligor or both) demand,
collect (including without limitation by way of a lockbox arrangement), receive,
take receipt for, sell, sue for, compound, settle, compromise and give
acquittance for any and all amounts due or to become due on any Account, and, in
the Administrative Agent’s discretion, file any claim or take any other action
or proceeding to protect and realize upon the security interest of the Secured
Parties in the Accounts.  Neither the Administrative Agent nor the Secured
Parties shall have any liability or responsibility to any Obligor for acceptance
of a check, draft or other order for payment of money bearing the legend
“payment in full” or words of similar import or any other restrictive legend or
endorsement or be responsible for determining the correctness of any
remittance.  Furthermore, during the continuation of an Event of Default,
(i) the Administrative Agent shall have the right, but not the obligation, to
make test verifications of the Accounts in any manner and through any medium
that it reasonably considers advisable, and the Obligors shall furnish all such
assistance and information as the Administrative Agent may require in connection
with such test verifications, (ii) upon the Administrative Agent’s request and
at the expense of the Obligors, the Obligors shall cause independent public
accountants

 

12

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

 

or others satisfactory to the Administrative Agent to furnish to the
Administrative Agent reports showing reconciliations, aging and test
verifications of, and trial balances for, the Accounts and (iii) the
Administrative Agent in its own name or in the name of others may communicate
with account debtors on the Accounts to verify with them to the Administrative
Agent’s satisfaction the existence, amount and terms of any Accounts.

 

(c)                                  Deposit Accounts.  Upon the occurrence of
an Event of Default and during continuation thereof, the Administrative Agent
may prevent withdrawals or other dispositions of funds in Deposit Accounts
maintained with the Administrative Agent.

 

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

 

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

 

(f)                                   Retention of Collateral.  In addition to
the rights and remedies hereunder, the Administrative Agent may, upon the
occurrence of an Event of Default and during the continuance thereof, in
compliance with Sections 9-620 and 9-621 of the UCC or otherwise complying with
the requirements of applicable Law of the relevant jurisdiction, accept or
retain the Collateral in satisfaction of the Secured Obligations.  Unless and
until the Administrative Agent shall have provided such notices, however, the
Administrative Agent shall not be deemed to have retained any Collateral in
satisfaction of any Secured Obligations for any reason.

 

(g)                                  Deficiency.  In the event that the proceeds
of any sale, collection or realization are insufficient to pay all amounts to
which the Administrative Agent or the Secured Parties are legally entitled, the
Obligors shall be jointly and severally liable for the deficiency, together with
interest thereon at a rate per annum equal to 2% plus the rate applicable to ABR
Loans, together with the costs of collection and the fees, charges and
disbursements of counsel.  Any surplus remaining after the full payment in cash
and satisfaction of the Secured Obligations and the termination or expiration of
the Commitments shall be returned to the Obligors or to whomsoever a court of
competent jurisdiction shall determine to be entitled thereto.

 

13

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

 

8.                                      Rights of the Administrative Agent.

 

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

 

(i)                                     to demand, collect, settle, compromise,
adjust, give discharges and releases, all as the Administrative Agent may
reasonably determine;

 

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

 

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

 

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

 

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

 

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

 

(vii)                           execute and deliver all assignments,
conveyances, statements, financing statements, renewal financing statements,
security agreements, affidavits, notices and other agreements, instruments and
documents that the Administrative Agent may determine necessary in order to
perfect (other than with respect to Excluded Property) and maintain the security
interests and liens granted in this Agreement and in order to fully consummate
all of the transactions contemplated therein;

 

(viii)                        institute any foreclosure proceedings that the
Administrative Agent may deem appropriate;

 

(ix)                              to sign and endorse any drafts, assignments,
proxies, stock powers, verifications, notices and other documents relating to
the Collateral;

 

(x)                                 to exchange any of the Pledged Equity or
other property upon any merger, consolidation, reorganization, recapitalization
or other readjustment of the issuer thereof and, in connection therewith,
deposit any of the Pledged Equity with any committee, depository, transfer
agent, registrar or other designated agency upon such terms as the
Administrative Agent may reasonably deem appropriate;

 

14

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

 

(xi)                              to vote for a shareholder resolution, or to
sign an instrument in writing, sanctioning the transfer of any or all of the
Pledged Equity into the name of the Administrative Agent or one or more of the
Secured Parties or into the name of any transferee to whom the Pledged Equity or
any part thereof may be sold pursuant to Section 7 hereof;

 

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

 

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

 

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

 

(xv)                          do and perform all such other acts and things as
the Administrative Agent may reasonably deem to be necessary, proper or
convenient in connection with the Collateral.

 

This power of attorney is a power coupled with an interest and shall be
irrevocable until such time as the Secured Obligations arising under the Loan
Documents have been paid in full in cash (other than (x) contingent
indemnification obligations for which no claim has been made and (y) Swap
Obligations or Banking Services Obligations not yet due and payable) and the
Commitments have expired or been terminated.  The Administrative Agent shall be
under no duty to exercise or withhold the exercise of any of the rights, powers,
privileges and options expressly or implicitly granted to the Administrative
Agent in this Agreement, and shall not be liable for any failure to do so or any
delay in doing so.  The Administrative Agent shall not be liable for any act or
omission or for any error of judgment or any mistake of fact or law in its
individual capacity or its capacity as attorney-in-fact except acts or omissions
resulting from its gross negligence or willful misconduct as determined by a
court of competent jurisdiction by final and nonappealable judgment.  This power
of attorney is conferred on the Administrative Agent solely to protect, preserve
and realize upon its security interest in the Collateral.

 

(b)                                 Assignment by the Administrative Agent. The
Administrative Agent may from time to time assign the Secured Obligations to a
successor Administrative Agent appointed in accordance with the Credit
Agreement, and such successor shall be entitled to all of the rights and
remedies of the Administrative Agent under this Agreement in relation thereto.

 

(c)                                  The Administrative Agent’s Duty of Care.
 Other than the exercise of reasonable care to assure the safe custody of the
Collateral while being held by the Administrative Agent hereunder, the
Administrative Agent shall have no duty or liability to preserve rights
pertaining thereto, it being understood and agreed that the Obligors shall be
responsible for preservation of all rights in the Collateral, and the
Administrative Agent shall be relieved of all responsibility for the Collateral
upon surrendering it or tendering the surrender of it to the Obligors.  The
Administrative Agent shall be deemed to have exercised reasonable care in the
custody and preservation of the Collateral in its possession if the Collateral
is accorded treatment substantially equal to that which the

 

15

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

 

Administrative Agent accords its own property, which shall be no less than the
treatment employed by a reasonable and prudent agent in the industry, it being
understood that the Administrative Agent shall not have responsibility for
taking any necessary steps to preserve rights against any parties with respect
to any of the Collateral.  In the event of a public or private sale of
Collateral pursuant to Section 7 hereof, the Administrative Agent shall have no
responsibility for (i) ascertaining or taking action with respect to calls,
conversions, exchanges, maturities, tenders or other matters relating to any
Collateral, whether or not the Administrative Agent has or is deemed to have
knowledge of such matters, or (ii) taking any steps to clean, repair or
otherwise prepare the Collateral for sale.

 

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

 

(e)                                  Voting and Payment Rights in Respect of the
Pledged Equity.

 

(i)                                     So long as no Event of Default shall
exist, each Obligor may (A) exercise any and all voting and other consensual
rights pertaining to the Pledged Equity of such Obligor or any part thereof for
any purpose not inconsistent with the terms of this Agreement or the Credit
Agreement and (B) receive and retain any and all dividends (other than stock
dividends and other dividends constituting Collateral which are addressed
hereinabove), principal or interest paid in respect of the Pledged Equity to the
extent they are allowed under the Credit Agreement; and

 

(ii)                                  During the continuance of an Event of
Default, upon notice from the Administrative Agent, (A) all rights of an Obligor
to exercise the voting and other consensual rights which it would otherwise be
entitled to exercise pursuant to clause (i)(A) above shall cease and all such
rights shall thereupon become vested in the Administrative Agent which shall
then have the sole right to exercise such voting and other consensual rights,
(B) all rights of an Obligor to receive the dividends, principal and interest
payments which it would otherwise be authorized to receive and retain pursuant
to clause (i)(B) above shall cease and all such rights shall thereupon be vested
in the Administrative Agent which shall then have the sole right to receive and
hold as Collateral such dividends, principal and interest payments, and (C) all
dividends, principal and interest payments which are received by an Obligor
contrary to the provisions of clause (ii)(B) above shall be received in trust
for the benefit of the Administrative Agent, shall be segregated from other
property or funds of such Obligor, and shall be forthwith paid over to the
Administrative Agent as Collateral in the exact form received, to be held by the
Administrative Agent as Collateral and as further collateral security for the
Secured Obligations.

 

16

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

 

(f)                                   Releases of Collateral.  (i) If any
Collateral shall be sold, transferred or otherwise disposed of by any Obligor in
a transaction permitted by the Credit Agreement, then the Administrative Agent,
at the request and sole expense of such Obligor, shall promptly execute and
deliver to such Obligor all releases and other documents, and take such other
action, reasonably necessary for the release of the Liens created hereby or by
any other Collateral Document on such Collateral.  (ii) The Administrative Agent
may release any of the Pledged Equity from this Agreement or may substitute any
of the Pledged Equity for other Pledged Equity without altering, varying or
diminishing in any way the force, effect, lien, pledge or security interest of
this Agreement as to any Pledged Equity not expressly released or substituted,
and this Agreement shall continue as a Lien on all Pledged Equity not expressly
released or substituted.

 

9.                                      Application of Proceeds.  Upon the
acceleration of the Obligations pursuant to Section 7.02 of the Credit
Agreement, any payments in respect of the Secured Obligations and any proceeds
of the Collateral, when received by the Administrative Agent or any Secured
Party in Money, will be applied in reduction of the Secured Obligations in the
order set forth in Section 2.18(b) of the Credit Agreement.

 

10.                               Continuing Agreement.

 

(a)                                 This Agreement shall remain in full force
and effect until such time as the Secured Obligations arising under the Loan
Documents have been paid in full in cash (other than (x) contingent
indemnification obligations for which no claim has been asserted and (y) Swap
Obligations or Banking Services Obligations) and the Commitments have expired or
been terminated, at which time this Agreement shall be automatically terminated
and the Administrative Agent shall, upon the request and at the expense of the
Obligors, forthwith release all of its liens and security interests hereunder
and shall execute and deliver all UCC termination statements and/or other
documents reasonably requested by the Obligors evidencing such termination.

 

(b)                                 This Agreement shall continue to be
effective or be automatically reinstated, as the case may be, if at any time
payment, in whole or in part, of any of the Secured Obligations is rescinded or
must otherwise be restored or returned by the Administrative Agent or any
Secured Party as a preference, fraudulent conveyance or otherwise under any
Debtor Relief Law, all as though such payment had not been made; provided that
in the event payment of all or any part of the Secured Obligations is rescinded
or must be restored or returned, all reasonable costs and expenses (including
without limitation any reasonable legal fees and disbursements) incurred by the
Administrative Agent or any Secured Party in defending and enforcing such
reinstatement shall be deemed to be included as a part of the Secured
Obligations.

 

11.                               Amendments; Waivers; Modifications, etc.  This
Agreement and the provisions hereof may not be amended, waived, modified,
changed, discharged or terminated unless in writing signed by the Administrative
Agent and each Obligor, and then only to the extent in such writing specifically
set forth therein; provided that any update or revision to Schedule 2(c) hereof
delivered by any Obligor shall not constitute an amendment for purposes of this
Section 11.

 

12.                               Successors in Interest.  This Agreement shall
be binding upon each Obligor, its successors and assigns and shall inure,
together with the rights and remedies of the Administrative Agent and the
Secured Parties hereunder, to the benefit of the Administrative Agent and the
Secured Parties and their successors and permitted assigns.

 

13.                               Notices.  All notices required or permitted to
be given under this Agreement shall be in conformance with Section 9.01 of the
Credit Agreement.

 

17

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

 

14.                               Counterparts.  This Agreement may be executed
in any number of counterparts, each of which where so executed and delivered
shall be an original, but all of which shall constitute one and the same
instrument.  It shall not be necessary in making proof of this Agreement to
produce or account for more than one such counterpart.  Delivery of an executed
counterpart of a signature page of this Agreement by telecopy shall be effective
as delivery of a manually executed counterpart of this Agreement.

 

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

 

16.                               Governing Law; Submission to Jurisdiction;
Venue; WAIVER OF JURY TRIAL.  The terms of Sections 9.09 and 9.10 of the Credit
Agreement with respect to governing law, submission to jurisdiction, venue and
waiver of jury trial are incorporated herein by reference, mutatis mutandis, and
the parties hereto agree to such terms.

 

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

 

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

 

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

 

20.                               Joinder.  At any time after the date of this
Agreement, one or more additional Persons may become party hereto by executing
and delivering to the Administrative Agent a Joinder Agreement in form and
substance reasonably satisfactory to the Administrative Agent.  Immediately upon
such execution and delivery of such Joinder Agreement (and without any further
action), each such additional Person will become a party to this Agreement as an
“Obligor” and have all of the rights and obligations of an Obligor hereunder and
this Agreement and the schedules hereto shall be deemed amended by such Joinder
Agreement.

 

21.                               Rights of Required Lenders.  All rights of the
Administrative Agent hereunder, if not exercised by the Administrative Agent,
may be exercised by the Required Lenders.

 

22.                               Consent of Issuers of Pledged Equity.  Each
issuer of Pledged Equity party to this Agreement hereby acknowledges, consents
and agrees to the grant of the security interests in such Pledged Equity by the
applicable Obligors pursuant to this Agreement, together with all rights
accompanying such security interest as provided by this Agreement and applicable
law, notwithstanding any anti-assignment provisions in any operating agreement,
limited partnership agreement or similar organizational or governance documents
of such issuer.

 

18

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

 

23.                               California Waivers.  To the extent California
law applies, in addition to and not in lieu of any other provisions of this
Agreement, each Obligor represents, warrants, covenants and agrees as follows:

 

(a)                                 The obligations of such Obligor under this
Agreement shall be performed without demand by any Secured Party or the
Administrative Agent and shall be unconditional irrespective of the genuineness,
validity, regularity or enforceability of any of the Loan Documents, Swap
Contracts or Banking Services Agreements, and without regard to any other
circumstance which might otherwise constitute a legal or equitable discharge of
a surety or a guarantor.  Each Obligor hereby waives any and all benefits and
defenses under California Civil Code Section 2810 and agrees that by doing so
such Obligor shall be liable even if the Borrower had no liability at the time
of execution of the applicable Loan Documents, Swap Contracts or Banking
Services Agreements, or thereafter ceases to be liable.  Each Obligor hereby
waives any and all benefits and defenses under California Civil Code
Section 2809 and agrees that by doing so such Obligor’s liability may be larger
in amount and more burdensome than that of the Borrower.  Each Obligor hereby
waives the benefit of all principles or provisions of law, statutory or
otherwise, which are or might be in conflict with the terms of this Agreement
and agrees that such Obligor’s obligations shall not be affected by any
circumstances, whether or not referred to in this Agreement which might
otherwise constitute a legal or equitable discharge of a surety or a guarantor. 
Each Obligor hereby waives the benefits of any right of discharge under any and
all statutes or other laws relating to guarantors or sureties and any other
rights of sureties and guarantors thereunder.

 

(b)                                 In accordance with Section 2856 of the
California Civil Code, each Obligor hereby waives all rights and defenses
arising out of an election of remedies by the Secured Parties and/or the
Administrative Agent even though that election of remedies, such as a
nonjudicial foreclosure with respect to security for the Secured Obligations,
has destroyed or otherwise impaired such Obligor’s rights of subrogation and
reimbursement against the principal by the operation of Section 580d of the
California Code of Civil Procedure or otherwise. Each Obligor hereby authorizes
and empowers the Secured Parties and the Administrative Agent to exercise, in
their sole and absolute discretion, any right or remedy, or any combination
thereof, which may then be available, since it is the intent and purpose of such
Obligor that its obligations under this Agreement shall be absolute, independent
and unconditional under any and all circumstances.  Specifically, and without in
any way limiting the foregoing, each Obligor hereby waives any rights of
subrogation, indemnification, contribution or reimbursement arising under
Sections 2846, 2847, 2848 and 2849 of the California Civil Code or any other
right of recourse to or with respect to the Borrower, any constituent of the
Borrower, any other Person, or the assets or property of any of the foregoing or
to any collateral for the Secured Obligations until all of the Secured
Obligations (other than Unliquidated Obligations) have been paid and satisfied
in full in cash or cash collateralized in accordance with Section 2.06(j) of the
Credit Agreement, as the case may be, and the Commitments have terminated or
expired.  Each Obligor recognizes that, pursuant to Section 580d of the
California Code of Civil Procedure, the Secured Parties’ realization through
nonjudicial foreclosure upon any real property constituting security for the
Secured Obligations could terminate any right of the Secured Parties to recover
a deficiency judgment against the Borrower, thereby terminating subrogation
rights which other parties might otherwise might have against the Borrower.  In
the absence of an adequate waiver, such a termination of subrogation rights
could create a defense to enforcement of this Agreement against such parties. 
Each Obligor hereby unconditionally and irrevocably waives any such defense.

 

19

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

 

(c)                                  In addition to and without in any way
limiting the foregoing, each Obligor hereby subordinates any and all
Indebtedness of the Borrower now or hereafter owed to such Obligor to the prior
payment in full in cash or cash collateralization in accordance with
Section 2.06(j) of the Credit Agreement, as the case may be, of all the Secured
Obligations (other than Unliquidated Obligations) owed by the Borrower or any of
its Subsidiaries to the Secured Parties and the termination or expiration of the
Commitments and agrees with the Secured Parties that until all of the Secured
Obligations (other than Unliquidated Obligations) have been paid and satisfied
in full in cash or cash collateralized in accordance with Section 2.06(j) of the
Credit Agreement, as the case may be, and the Commitments have terminated or
expired, each Obligor shall not demand or accept any payment of principal or
interest from the Borrower, claim any offset or other reduction of such
Obligor’s obligations hereunder because of any such Indebtedness, nor take any
action to obtain any of the collateral for the Secured Obligations, provided
that, notwithstanding the foregoing, the Obligors may make payments on account
of all such Indebtedness until the Obligors have received written notice from
the Administrative Agent indicating the Administrative Agent’s election to
suspend the Obligors’ ability to make payments in accordance with this Section,
which notice shall only be tendered by the Administrative Agent following the
occurrence and during the continuance of an Event of Default .  If any amount
shall nevertheless be paid to any Obligor by the Borrower or another guarantor
in violation of the foregoing provisions, such amount shall be held in trust for
the benefit of the Secured Parties and shall forthwith be paid to the Secured
Parties or the Administrative Agent.  Without limiting the generality of the
foregoing, each Obligor hereby waives, to the fullest extent permitted by law,
diligence in collecting the Secured Obligations, presentment, demand for
payment, protest, all notices with respect to this Agreement, or any other Loan
Document, Swap Contract or Banking Services Agreement which may be required by
statute, rule of law or otherwise to preserve the Secured Parties’ rights
against such Obligor under this Agreement, including, but not limited to, notice
of acceptance, notice of any amendment of the Loan Documents, any Swap Contract
or any Banking Services Agreement, notice of the occurrence of any default,
notice of intent to accelerate, notice of acceleration, notice of dishonor,
notice of foreclosure, notice of protest, and notice of the incurring by the
Borrower of any obligation or Indebtedness.

 

(d)                                 Without limiting the foregoing, each Obligor
waives all rights of subrogation, reimbursement, indemnification, and
contribution and any other rights and defenses that are or may become available
to such Obligor by reason of California Civil Code Sections 2787 to 2855,
inclusive, including any and all rights or defenses such Obligor may have by
reason of protection afforded to the Borrower with respect to any of the
obligations of such Obligor under this Agreement by reason of a nonjudicial
foreclosure or pursuant to the antideficiency or other laws of the State of
California limiting or discharging the Secured Obligations until all of the
Secured Obligations (other than Unliquidated Obligations) have been paid and
satisfied in full in cash or cash collateralized in accordance with
Section 2.06(j) of the Credit Agreement, as the case may be, and the Commitments
have terminated or expired.  Without limiting the generality of the foregoing,
each Obligor hereby expressly waives any and all benefits under (i) California
Code of Civil Procedure Section 580a (which Section, if such Obligor had not
given this waiver, would otherwise limit such Obligor’s liability after a
nonjudicial foreclosure sale to the difference between the obligations of such
Obligor under this Agreement and the fair market value of the property or
interests sold at such nonjudicial foreclosure sale), (ii) California Code of
Civil Procedure Sections 580b and 580d (which Sections, if such Obligor had not
given this waiver, would otherwise limit the Secured Parties’ right to recover a
deficiency judgment with respect to purchase money obligations and after a
nonjudicial foreclosure sale, respectively), and (iii) California Code of Civil
Procedure Section 726 (which Section, if such Obligor had not given this waiver,
among other things, would otherwise require the Secured Parties to exhaust all
of their

 

20

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

 

security before a personal judgment could be obtained for a deficiency). 
Notwithstanding any foreclosure of the lien of any or all of the Mortgages,
whether by the exercise of the power of sale contained therein, by an action for
judicial foreclosure, or by the Secured Parties’ or the Administrative Agent’s
acceptance of a deed in lieu of foreclosure, Obligors shall remain bound under
this Agreement.

 

(e)                                  Likewise, each Obligor waives (i) any and
all rights and defenses available to such Obligor under California Civil Code
Sections 2899 and 3433; (ii) any rights or defenses such Obligor may have with
respect to its obligations as a guarantor by reason of any election of remedies
by the Secured Parties and/or the Administrative Agent; and (iii) all rights and
defenses that such Obligor may have because the Borrower’s debt is secured by
real property.  This means, among other things, that the Secured Parties or the
Administrative Agent may collect from Obligors without first foreclosing on any
real or personal property collateral pledged by the Borrower, and that if the
Secured Parties or the Administrative Agent forecloses on any real property
collateral pledged by the Borrower (A) the amount of the debt may be reduced
only by the price for which that collateral is sold at the foreclosure sale,
even if the collateral is worth more than the sale price, and (B) any Secured
Party or the Administrative Agent may collect from Obligors even if the Secured
Parties or the Administrative Agent, by foreclosing on the real property
collateral, has destroyed any rights Obligors may have to collect from the
Borrower.  This is an unconditional and irrevocable waiver of any rights and
defenses Obligors may have because the Borrower’s debt evidenced by the Loan
Documents, any Swap Contract or any Banking Services Agreement is secured by
real property.  These rights and defenses include, but are not limited to, any
rights or defenses based upon Section 580a, 580b, 580d, or 726 of the California
Code of Civil Procedure.

 

(f)                                   Nothing herein shall be deemed to limit
the right of the Secured Parties or the Administrative Agent to recover in
accordance with California Code of Civil Procedure Section 736 (as such
Section may be amended from time to time), any costs, expenses, liabilities or
damages, including reasonable attorneys’ fees and costs, incurred by the Secured
Parties and/or the Administrative Agent and arising from any covenant,
obligation, liability, representation or warranty contained in any indemnity
agreement given to the Secured Parties and/or the Administrative Agent, or any
order, consent decree or settlement relating to the cleanup of Hazardous
Materials or any other “environmental provision” (as defined in such
Section 736) relating to any of the Collateral or any portion thereof or the
right of the Secured Parties or the Administrative Agent to waive, in accordance
with the California Code of Civil Procedure Section 726.5 (as such Section may
be amended from time to time), the security of any of the Mortgages as to any
parcel of any Collateral that is “environmentally impaired” or is an “affected
parcel” (as such terms are defined in such Section 726.5), and as to any
personal property attached to such parcel, and thereafter to exercise against
the Borrower, to the extent permitted by such Section 726.5, the rights and
remedies of any unsecured creditor, including reduction of the Secured Parties’
claim against the Borrower to judgment, and any other rights and remedies
permitted by law.

 

(g)                                  The provisions of this Section 23 shall
survive any satisfaction and discharge of the Borrower and the Subsidiary
Guarantors by virtue of any payment, court order or any applicable law, except
the full payment in cash or the cash collateralization in accordance with
Section 2.06(j) of the Credit Agreement, as the case may be, and complete
satisfaction of the Secured Obligations (other than Unliquidated Obligations)
and the termination or expiration of the Commitments.

 

[remainder of page intentionally left blank]

 

21

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

 

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

 

OBLIGORS:

NEWPORT CORPORATION,

 

a Nevada corporation

 

 

 

 

By:

/s/ Charles F. Cargile

 

Name:

Charles F. Cargile

 

Title:

Senior Vice President, Chief Financial Officer and Treasurer

 

 

 

 

 

OPHIR HOLDINGS, INC.,

 

a Massachusetts corporation

 

 

 

 

 

By:

/s/ Jeffrey B. Coyne

 

 

Name:

Jeffrey B. Coyne

 

 

Title:

Vice President and Secretary

 

 

 

 

 

OPHIR OPTICS, LLC,

 

a Massachusetts limited liability company

 

 

 

 

 

By:

/s/ Jeffrey B. Coyne

 

 

Name:

Jeffrey B. Coyne

 

 

Title:

Vice President and Secretary

 

 

 

 

 

OPHIR-SPIRICON, LLC,

 

a Utah limited liability company

 

 

 

 

 

By:

/s/ Jeffrey B. Coyne

 

 

Name:

Jeffrey B. Coyne

 

 

Title:

Secretary

 

 

 

 

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

 

 

 

JPMORGAN CHASE BANK, N.A., as Administrative Agent

 

 

 

By:

/s/ Ling Li

 

 

Name:

Ling Li

 

 

Title:

Vice President

 

 

 

Signature Page to Security and Pledge Agreement

 

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

 

SCHEDULE 1(b)

 

PLEDGED EQUITY

 

Obligor: Newport Corporation

 

Name of Subsidiary

 

Jurisdiction

 

Number of Shares/Units
Owned

 

Number of Shares/Units
Pledged

 

Percentage
Ownership
Pledged

 

Pledged
Certificate
Number

 

Newport Domestic International Sales Corporation

 

California

 

2,500 shares of common stock

 

2,500 shares of common stock

 

100

%

2

 

Newport Government Systems, Inc.

 

California

 

100 shares of common stock

 

100 shares of common stock

 

100

%

2

 

Newport European Distribution Company (Foreign Holding Company)

 

California

 

2,000,000 shares of common stock;

 

1,300,000 shares of common stock;

 

65

%

3;

 

70,000 shares of Series A Preferred Stock

 

45,500 shares of Series A Preferred Stock

 

 

 

A-2

 

Micro Controle Spectra-Physics S.A.S.

 

France

 

62,665 shares

 

40,733 shares

 

65

%

Uncertificated

 

Newport Corporation (Barbados) SRL

 

Barbados

 

99 common quotas

 

64 common quotas

 

65

%

1**

 

Newport Instruments Canada Corporation

 

Canada

 

1 common share

 

0.65 common share

 

65

%

1**

 

Newport Ophir Holdings Ltd.

 

Israel

 

100

 

100

 

100

%

OS-1

 

Newport Opto-Electronics Technologies (Singapore) Pte. Ltd.

 

Singapore

 

1,052,788 ordinary shares

 

684,313 ordinary shares

 

65

%

6

 

Newport Opto-Electronics Technologies (Wuxi) Company Limited

 

China

 

USD 6,000,000 registered capital

 

USD 3,900,000 registered capital

 

65

%

Uncertificated

 

Newport Spectra-Physics BV

 

Netherlands

 

400 registered shares

 

260 registered shares

 

65

%

Uncertificated

 

Newport Spectra-Physics Ltd.

 

United Kingdom

 

806,914 shares

 

524,495 shares

 

65

%

12

 

Spectra-Physics K.K.

 

Japan

 

80,000 shares

 

52,000 shares

 

65

%

B-002

 

Newport Laser Holding GmbH

 

Austria

 

Euro 35,000 share capital

 

Euro 22,750 share capital

 

65

%

Uncertificated

 

 

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

**Certificate for full number of shares owned being delivered with stock power
for pledged portion of shares.

 

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

 

Obligor: Ophir Holdings, Inc.

 

Name of Subsidiary

 

Jurisdiction

 

Number of Shares/Units
Owned

 

Number of Shares/Units
Pledged

 

Percentage
Ownership
Pledged

 

Pledged
Certificate
Number

 

Ophir Optics, LLC

 

Massachusetts

 

300 membership units

 

300 membership units

 

100

%

Uncertificated

 

Ophir-Spiricon, LLC

 

Utah

 

9,660 membership units

 

9,660 membership units

 

100

%

Uncertificated

 

 

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

 

SCHEDULE 2(c)

 

COMMERCIAL TORT CLAIMS

 

All claims of Newport Corporation under that certain case entitled Newport
Corporation v. Lighthouse Photonics Incorporated, Case No. SACV12-0719 DOC
(JPRx), pending in the U.S. District Court for the Central District of
California, Southern Division.  Newport has filed a complaint in such court,
alleging that Lighthouse Photonics Incorporated has infringed and continues to
infringe on Newport’ U.S. Patent Nos. 5,446,749, 6,241,720 and 6,287,298 by
making, using, offering for sale and selling its Sprout laser systems.

 

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

 

SCHEDULE 3(g)

 

INSTRUMENTS; DOCUMENTS; TANGIBLE CHATTEL PAPER

 

None.

 

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

 

EXHIBIT 4(a)(ii)

 

IRREVOCABLE STOCK POWER

 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers to the
following Equity Interests of                                           , a
                         corporation:

 

No. of Shares

 

Certificate No.

 

 

 

 

 

 

 

 

 

 

and irrevocably appoints
                                                                     its agent
and attorney-in-fact to transfer all or any part of such Equity Interests and to
take all necessary and appropriate action to effect any such transfer.  The
agent and attorney-in-fact may substitute and appoint one or more persons to act
for him.

 

 

 

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

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

 

EXHIBIT 4(b)(i)

 

NOTICE

 

OF

 

GRANT OF SECURITY INTEREST

 

IN

 

PATENTS

 

United States Patent and Trademark Office

 

Ladies and Gentlemen:

 

Please be advised that pursuant to the Security and Pledge Agreement dated as of
July 18, 2013 (as the same may be amended, modified, extended or restated from
time to time, the “Agreement”) by and among the Obligors party thereto (each an
“Obligor” and collectively, the “Obligors”) and JPMorgan Chase Bank, N.A., as
administrative agent (the “Administrative Agent”) for the Secured Parties
referenced therein, the undersigned Obligor has granted a continuing security
interest in and continuing lien upon the patents and patent applications shown
below to the Administrative Agent for the ratable benefit of the Secured
Parties:

 

PATENTS

 

Patent No.

 

Description of
Patent Item

 

Date of Patent

 

 

 

 

 

 

 

See Schedule 1 attached hereto

 

 

 

PATENT APPLICATIONS

 

Patent Applications No.

 

Description of
Patent Applied for

 

Date of
Patent Applications

 

 

 

 

 

 

 

See Schedule 1 attached hereto

 

 

 

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

 

The undersigned Obligor and the Administrative Agent, on behalf of the Secured
Parties, hereby acknowledge and agree that the security interest in the
foregoing patents and patent applications (i) may only be terminated in
accordance with the terms of the Agreement and (ii) is not to be construed as an
assignment of any patent or patent application.

 

 

Very truly yours,

 

 

 

 

 

[Obligor]

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

Acknowledged and Accepted:

 

 

 

JPMORGAN CHASE BANK, N.A., as Administrative Agent

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

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

 

EXHIBIT  4(b)(ii)

 

NOTICE

 

OF

 

GRANT OF SECURITY INTEREST

 

IN

 

TRADEMARKS

 

United States Patent and Trademark Office

 

Ladies and Gentlemen:

 

Please be advised that pursuant to the Security and Pledge Agreement dated as of
July 18, 2013 (as the same may be amended, modified, extended or restated from
time to time, the “Agreement”) by and among the Obligors party thereto (each an
“Obligor” and collectively, the “Obligors”) and JPMorgan Chase Bank, N.A., as
Administrative Agent (the “Administrative Agent”) for the Secured Parties
referenced therein, the undersigned Obligor has granted a continuing security
interest in and continuing lien upon the trademarks and trademark applications
shown below to the Administrative Agent for the ratable benefit of the Secured
Parties:

 

TRADEMARKS

 

 

 

Description of

 

 

Trademark No.

 

Trademark Item

 

Date of Trademark

 

 

 

 

 

See Schedule 1 attached hereto

 

TRADEMARK APPLICATIONS

 

 

 

Description of

 

Date of

Trademark Applications No.

 

Trademark Applied for

 

Trademark Applications

 

 

 

 

 

See Schedule 1 attached hereto

 

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

 

The undersigned Obligor and the Administrative Agent, on behalf of the Secured
Parties, hereby acknowledge and agree that the security interest in the
foregoing trademarks and trademark applications (i) may only be terminated in
accordance with the terms of the Agreement and (ii) is not to be construed as an
assignment of any trademark or trademark application.

 

 

Very truly yours,

 

 

 

 

 

[Obligor]

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

Acknowledged and Accepted:

 

 

 

JPMORGAN CHASE BANK, N.A., as Administrative Agent

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

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

 

EXHIBIT 4(b)(iii)

 

NOTICE

 

OF

 

GRANT OF SECURITY INTEREST

 

IN

 

COPYRIGHTS

 

United States Copyright Office

 

Ladies and Gentlemen:

 

Please be advised that pursuant to the Security and Pledge Agreement dated as of
July 18, 2013 (as the same may be amended, modified, extended or restated from
time to time, the “Agreement”) by and among the Obligors party thereto (each an
“Obligor” and collectively, the “Obligors”) and JPMorgan Chase Bank, N.A., as
administrative agent (the “Administrative Agent”) for the Secured Parties
referenced therein, the undersigned Obligor has granted a continuing security
interest in and continuing lien upon the copyrights and copyright applications
shown below to the Administrative Agent for the ratable benefit of the Secured
Parties:

 

COPYRIGHTS

 

Copyright No.

 

Description of
Copyright Item

 

Date of Copyright

 

 

 

 

 

 

 

See Schedule 1 attached hereto

 

 

 

COPYRIGHT APPLICATIONS

 

Copyright Applications No.

 

Description of
Copyright Applied for

 

Date of
Copyright Applications

 

 

 

 

 

 

 

See Schedule 1 attached hereto

 

 

 

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

 

The undersigned Obligor and the Administrative Agent, on behalf of the Secured
Parties, hereby acknowledge and agree that the security interest in the
foregoing copyrights and copyright applications (i) may only be terminated in
accordance with the terms of the Agreement and (ii) is not to be construed as an
assignment of any copyright or copyright application.

 

 

 

Very truly yours,

 

 

 

 

 

 

 

 

[Obligor]

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

 

Acknowledged and Accepted:

 

 

 

 

 

JPMORGAN CHASE BANK, N.A., as Administrative Agent

 

 

 

 

 

By:

 

 

 

Name:

 

 

 

Title:

 

 

 

 

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