Exhibit 10.3

PLEDGE, ASSIGNMENT, AND SECURITY AGREEMENT
Dated as of August 28, 2009
among
ALLIED CAPITAL CORPORATION,
as a Grantor,
THE OTHER GRANTORS PARTY HERETO FROM TIME TO TIME,
and
U.S. BANK NATIONAL ASSOCIATION,
as Collateral Agent for the Secured Parties

                              ARTICLE I DEFINIT  
IONS 1
    1.1.    
Certain Definitions
    1     1.2.    
Principals of Construction
    11               ARTICLE II  
GRANT OF SECURITY INTEREST
    12                 2.1.    
Security Interest
    12                 2.2.    
Authorization to File Financing Statements
    13                 2.3.    
Release of Collateral
    14               ARTICLE III  
REPRESENTATIONS AND WARRANTIES
    14                 3.1.    
Financing Documents
    14                 3.2.    
Title; Authorization; Enforceability; Perfection
    14                 3.3.    
Conflicting Legal Requirements and Contracts
    15                 3.4.    
Governmental Authority
    15                 3.5.    
Grantor Information
    15                 3.6.    
Property Locations
    15                 3.7.    
No Financing Statements or Control Agreements
    15                 3.8.    
Collateral
    16                 3.9.    
Deposit, Commodity, and Securities Accounts
    16                 3.10.    
Custodial Accounts
    16                 3.11.    
Accounts; General Intangibles
    16                 3.12.    
Letter of Credit Rights
    16                 3.13.    
Instruments; Chattel Paper; Collateral Notes; and Collateral Note Security
    17                 3.14.    
Material Agreements
    17                 3.15.    
Investment Related Property
    17                 3.16.    
Intellectual Property
    18                 3.17.    
Consents; Pledge LLC
    18                 3.18.    
Real Property
    19               ARTICLE IV  
COVENANTS
    19                 4.1.    
Financing Documents
    19                 4.2.    
General
    19                 4.3.    
Perform Obligations
    21                 4.4.    
Investment Related Property
    21                 4.5.    
Collateral in Trust
    22                 4.6.    
Intellectual Property
    23                 4.7.    
Collateral Notes and Collateral Note Security
    24                 4.8.    
Deposit, Commodity, Securities and Custodial Accounts
    24                 4.9.    
Commercial Tort Claims
    24                 4.10.    
Letters-of-Credit Rights
    24                 4.11.    
Material Agreements
    25                 4.12.    
Modification of Accounts
    25                 4.13.    
Estoppel and Other Agreements and Matters
    25                 4.14.    
Use of Collateral
    25                 4.15.    
Insurance
    25                 4.16.    
Further Assurances
    26                 4.17.    
Additional Grantors
    26                 4.18.    
Future Assets of Grantors
    27                 4.19.    
Consents; Pledge LLC; Second Tier Collateral; Etc
    27                 4.20.    
Real Property; Fixtures
    28               ARTICLE V  
RIGHTS AND REMEDIES
    28                 5.1.    
Remedies
    28                 5.2.    
Grantors’ Obligations Upon a Triggering Event
    30                 5.3.    
Condition of Collateral; Warranties
    30                 5.4.    
Collection of Receivables
    30                 5.5.    
Special Collateral Account
    30                 5.6.    
Intellectual Property
    31                 5.7.    
Record Ownership of Securities
    31                 5.8.    
Investment Related Property
    31                 5.9.    
Sales on Credit
    32                 5.10.    
Application of Proceeds
    32                 5.11.    
Performance
    32                 5.12.    
Use and Operation of Collateral
    32                 5.13.    
Power of Attorney
    33                 5.14.    
Subrogation
    34                 5.15.    
Indemnification
    35               ARTICLE VI  
GENERAL PROVISIONS
    35                 6.1.    
Termination
    35                 6.2.    
Joint and Several Obligations of Grantors
    35                 6.3.    
NO RELEASE OF GRANTORS
    35                 6.4.    
Subordination of Certain Claims
    36                 6.5.    
Recovered Payments
    37                 6.6.    
No Waiver. Amendments
    37                 6.7.    
Specific Performance of Certain Covenants
    37                 6.8.    
Survival
    37                 6.9.    
Taxes and Expenses
    37                 6.10.    
Multiple Counterparts
    38                 6.11.    
Parties Bound; Assignment
    38                 6.12.    
Governing Law
    38              

  6.13.   JURISDICTION; CONSENT TO SERVICE OF PROCESS; WAIVER OF JURY TRIAL 39  

                    6.14.    
Notices
    40     6.15.    
Non-Liability of Collateral Agent and Secured Parties
    41     6.16.    
Severability of Provisions
    42     6.17.    
Entirety
    42     6.18.    
Construction
    42     6.19.    
USA Patriot Act
    42     6.20.    
Confidentiality
    42     6.21.    
Intercreditor Agreement
    43  

          Schedules: 1.1   Senior
3.3
3.5
3.6
3.7
3.8
3.9
3.10
3.11
3.15.1
3.16
3.17.2
3.18  
Officers
Conflicting Legal Requirements
Grantor Information
Property Locations
Other Financing Statements
Collateral Descriptions
Securities Accounts, Commodity Accounts and Deposit Accounts
Custodial Account Information
Exceptions
Percentage of Pledged Equity Interests Owned
Intellectual Property
Assets Eligible for but not yet Transferred to a Pledge LLC
Real Property

    Exhibits: 4.2.2 Form of Asset Report Certificate

      4.6.3(i) Form of Notice of Grant of Security Interest in Copyrights

      4.6.3(ii) Form of Notice of Grant of Security Interest in Trademarks

      4.6.3(iii) Form of Notice of Grant of Security Interest in Patents

  4.17   Form of Joinder

PLEDGE, ASSIGNMENT, AND SECURITY AGREEMENT

THIS PLEDGE, ASSIGNMENT, AND SECURITY AGREEMENT (this “Security Agreement”) is
executed as of August 28, 2009, by ALLIED CAPITAL CORPORATION, a Maryland
corporation (“Borrower”), each of the Subsidiaries of Borrower set forth on the
signature pages hereof (collectively with Borrower and any Additional Grantor
(as hereafter defined), “Grantors”), and U.S. Bank National Association, a
national banking association, solely in its capacity as collateral agent for the
Secured Parties (as hereafter defined) pursuant to the Intercreditor Agreement
(in such capacity as collateral agent, together with its permitted successors
and/or assigns from time to time, “Collateral Agent”).

RECITALS

WHEREAS, Borrower has entered into that certain Amended and Restated Credit
Agreement dated as of August 28, 2009 (as the same may be further amended,
modified, supplemented, renewed, replaced or restated from time to time, the
“Credit Agreement”) among Borrower, Bank of America, N.A., as a lender and as
Administrative Agent (together with its permitted successors and/or assigns, in
such capacity, “Administrative Agent”) for the lenders now or hereafter a party
to the Credit Agreement (together with their respective permitted successors
and/or assigns, “Lenders”) and the Lenders party thereto.

WHEREAS, Borrower has entered into that certain Amended, Restated and
Consolidated Note Agreement dated as of August 28, 2009 (as the same may be
amended, modified, supplemented or restated from time to time the “Note
Agreement”) with the Noteholders (as defined in the Intercreditor Agreement)
party to such Note Agreement.

WHEREAS, prior to or concurrently herewith, Collateral Agent, Administrative
Agent, the Lenders, and the Noteholders have executed that certain Intercreditor
and Collateral Agency Agreement dated as of August 28, 2009 (as the same may be
amended, modified, supplemented or restated from time to time, the
“Intercreditor Agreement”), which Intercreditor Agreement has been acknowledged
and agreed to by Grantors and Pledge LLC.

WHEREAS, pursuant to and subject to the terms and conditions of the
Intercreditor Agreement, the Secured Parties (i) appointed Collateral Agent to
act as agent for the benefit of the Secured Parties with respect to the
Collateral (as hereinafter defined) and (ii) authorized and directed Collateral
Agent to execute the Collateral Documents and perform the duties and obligations
delegated to it pursuant to the terms of the Intercreditor Agreement.

WHEREAS, pursuant to the requirements of the Credit Agreement and the Note
Agreement, Grantors are required to enter into this Security Agreement.

NOW, THEREFORE, for valuable consideration, the receipt and adequacy of which
are hereby acknowledged, and in consideration of the mutual covenants and
undertakings and the terms and conditions contained herein, each Grantor and
Collateral Agent (for the benefit of the Secured Parties) hereby agree as
follows:

ARTICLE I
DEFINITIONS

1.1. Certain Definitions. Unless otherwise defined herein, or the context hereof
otherwise requires, each term defined in the UCC is used in this Security
Agreement with the same meaning; provided that, if any definition given to such
term in Article 9 of the UCC conflicts with the definition given to such term in
any other chapter of the UCC, the Article 9 definition shall prevail. As used
herein, the following terms have the meanings indicated:

Additional Grantor means each additional Person who grants a Lien on any
Collateral after the date hereof in accordance with Section 4.17 hereof.

Administrative Agent has the meaning set forth in the Recitals, together with
any other Person serving in the capacity of administrative agent or similar
capacity under the Credit Agreement.

Affiliate means, (a) as to Borrower and its Consolidated Subsidiaries, any
Person (other than a Consolidated Subsidiary or Portfolio Company) which
directly or indirectly, or through one or more intermediaries controls, is
controlled by, or is under common control with, Borrower and (b) as to any other
Person, any other Person which (i) directly or indirectly, or through one or
more intermediaries, controls, or is controlled by, or is under common control
with, such Person, (ii) beneficially owns or holds 5% or more of any class of
the equity interests of such Person entitled to vote or (iii) 5% or more of
whose voting equity interests are beneficially owned or held by such Person. The
term “control” means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of equity interests, by contract or otherwise,
other than, with respect to Borrower and its Consolidated Subsidiaries, by
investment advisory contracts entered into in the ordinary course of business of
Borrower or a Consolidated Subsidiary of Borrower.

Applicable Law means all applicable provisions of constitutions, statutes,
rules, regulations, and orders of all Governmental Authorities and all
applicable orders and decrees of all courts, tribunals, and arbitrators.

Applicable Triggering Event means with respect to the exercise of any specific
right, remedy, or action relating to the Collateral or arising under the
Collateral Documents, the occurrence of a Triggering Event with respect to which
Collateral Agent is directed to take (or forbear from taking) such action or to
exercise (or forbear from exercising) such right or remedy under the
Intercreditor Agreement. The words “continuing” or “continuation” or any
derivation thereof, when used with reference to an Applicable Triggering Event,
shall mean that the Triggering Event giving rise to such Applicable Triggering
Event is continuing.

Asset Report Certificate means a certificate duly completed and executed by two
(2) Senior Financial Officers of the Borrower substantially in the form of
Exhibit 4.2.2, together with such changes thereto or departures therefrom as the
Collateral Agent (as directed in accordance with the Intercreditor Agreement)
may from time to time reasonably request.

Bank Loan Documents has the meaning set forth in the Intercreditor Agreement.

Borrower has the meaning set forth in the Preamble.

Business Day means any day other than a Saturday, Sunday, or other day on which
banks in New York City, New York, Boston, Massachusetts and Washington, D.C. are
authorized or required to close.

Capitalized Lease Obligation means indebtedness represented by obligations under
a lease that is required to be capitalized for financial reporting purposes in
accordance with GAAP.

Cash Management Bank has the meaning set forth in the Intercreditor Agreement.

Collateral has the meaning set forth in Section 2.1.

Collateral Agent has the meaning set forth in the Preamble.

Collateral Documents means each security agreement, pledge agreement (including,
without limitation, this Security Agreement), mortgage, deed of trust, control
agreement, assignment and endorsement of insurance, or any other agreement,
joinder, ratification, or document, together with all related Control
Agreements, financing statements, and stock and transfer powers, now or
hereafter executed and delivered by a Grantor in connection with the Financing
Documents and intended to create a Lien on any real or personal property in
favor of Collateral Agent (for the benefit of the Secured Parties), as the same
may be amended, supplemented, replaced, modified and restated from time to time
in accordance with the terms of the Financing Documents.

Collateral Notes has the meaning set forth in Section 2.1.2 hereof.

Collateral Note Security has the meaning set forth in Section 2.1.2 hereof.

Collateral Records means books, records, ledger cards, files, correspondence,
customer lists, blueprints, technical specifications, manuals, computer
software, computer printouts, tapes, disks and related data processing software
and similar items that at any time evidence or contain any material information
relating to any of the Collateral or are otherwise reasonably necessary in the
collection thereof or realization thereupon.

Collateral Support means all property (real or personal) assigned, hypothecated
or otherwise securing any Collateral and shall include any security agreement or
other agreement granting a Lien or security interest in such real or personal
property.

Commodity Account means any “commodity account,” as such term is defined in
Section 9.102(a)(14) of the UCC, and all sub-accounts thereof.

Confidential Information has the meaning set forth in Section 6.20 hereof.

Consolidated Subsidiaries means any Subsidiary which is required to be
consolidated on financial statements of Borrower prepared in accordance with
GAAP, other than Allied Capital Beteiligungsberatung GmbH.

Control has the meaning set forth in Sections 7-106, 8-106, 9-104, 9-105, 9-106,
or 9-107 of the UCC, as applicable.

Control Agreement means, with respect to any Collateral consisting of Pledged
Equity Interests, Deposit Accounts, Securities Accounts, Commodities Accounts,
Custodial Accounts, electronic chattel paper, and letter-of-credit rights, an
agreement evidencing that Collateral Agent has Control of such Collateral, so
long as Collateral Agent is directed to enter into such Control Agreement
pursuant to the Intercreditor Agreement.

Controlled Foreign Corporation means a “controlled foreign corporation” as
defined in the Internal Revenue Code of 1986.

Copyrights means all United States and foreign copyrights (including community
designs), including copyrights in software and databases, and all Mask Works (as
defined under 17 U.S.C. 901 of the U.S. Copyright Act), whether registered or
unregistered, and, with respect to any and all of the foregoing: (a) all
registrations and applications therefor, including the registrations and
applications referred to on Schedule 3.16, (b) all extensions and renewals
thereof, (c) all rights corresponding thereto throughout the world, (d) all
rights to sue for past, present, and future infringements thereof, and (e) all
products and proceeds of the foregoing, including any income, royalties, and
awards and any claim by any Grantor against third parties for past, present, or
future infringement of any Copyright or any Copyright licensed under any
Copyright License.

Copyright Licenses means any and all agreements providing for the granting of
any right in or to Copyrights (whether a Grantor is licensee or licensor
thereunder), including each agreement referred to on Schedule 3.16.

Credit Agreement has the meaning set forth in the Recitals.

Custodial Account means any account maintained by any Grantor with any
Custodian, including those custodial accounts identified on Schedule 3.10,
together with all Instruments, certificates, Pledged Equity Interests,
Collateral Notes, Collateral Note Security, monies, checks, drafts, wire
transfer receipts, trust receipts, and other property deposited therein and all
balances therein, and any account which is a replacement or substitute for any
such Custodial Account.

Custodial Collateral means all Collateral (including certain Collateral Notes,
Collateral Note Security, Pledged Equity Interests and Instruments) and proceeds
thereof which are deposited in a Custodial Account maintained with and held by a
Custodian that has entered into a Custody Control Agreement, so long as such
Custodian’s books and records indicate that such Collateral is credited to or
recorded in such Custodial Account.

Custodian means a custodian, and its permitted successor and assigns or
permitted designee or nominee, holding any Custodial Collateral in a Custodial
Account.

Custody Control Agreement means any Control Agreement entered into by a
Custodian, the applicable Grantor, and Collateral Agent, so long as Collateral
Agent is directed to enter into such Custody Control Agreement pursuant to the
Intercreditor Agreement.

Default has the meaning set forth in the Intercreditor Agreement.

Deposit Account Control Agreement means any Control Agreement that establishes
Control with respect to a Deposit Account.

Deposit Accounts means any “deposit account”, as such term is defined in
Section 9.102(a)(29) of the UCC, including those deposit accounts identified on
Schedule 3.9, and any account which is a replacement or substitute for any of
such accounts, together with all monies, instruments, certificates, checks,
drafts, wire transfer receipts, and other property deposited therein and all
balances therein, but excluding payroll accounts, special accounts, trust
accounts, or escrow accounts maintained by any Grantor in a fiduciary capacity
or as an agent for unrelated third parties or for the benefit of any Portfolio
Company.

Disposition or Dispose has the meaning set forth in the Intercreditor Agreement.

Enforcement Direction has the meaning set forth in the Intercreditor Agreement.

Equity Interests means, with respect to any Person, all of the shares of capital
stock of (or other ownership or profit interests in) such Person, all of the
warrants, options or other rights for the purchase or acquisition from such
Person of shares of capital stock of (or other membership, ownership, or profit
interests in) such Person, all of the securities convertible into or
exchangeable for shares of capital stock of (or other ownership or profit
interests in) such Person or warrants, rights or options for the purchase or
acquisition from such Person of such shares (or such other interests), and all
of the other ownership or profit interests in such Person (including
partnership, member or trust interests therein), whether voting or nonvoting,
and whether or not such shares, warrants, options, rights or other interests are
outstanding on any date of determination.

Event of Default has the meaning set forth in the Intercreditor Agreement.

Excess Collateral has the meaning set forth in the definition of “Second Tier
Collateral.”

Excluded Assets means (i) the assets of Grantors, which in accordance with the
terms of the documents (or Applicable Law) which govern such assets and after
taking into account the obligations of Grantors under the Financing Documents,
the Collateral Documents and Sections 3.17 and 4.19 hereof are not permitted to
be pledged, or otherwise used to secure the indebtedness of Grantors without
having obtained the consent of any third Person, (ii) assets of a Pledge LLC to
the extent permitted by the Financing Documents, (iii) equipment covered by
Capitalized Lease Obligations and assets securing Interest Rate Agreements, to
the extent such Capitalized Lease Obligations or Interest Rate Agreements are
permitted under the Financing Documents, (iv) for the avoidance of doubt, assets
of any Portfolio Company, (v) the assets of Allied Capital Beteiligungsberatung
GmbH, (vi) the capital stock of Allied Capital REIT, Inc., and (vii) such other
assets of the Grantors as the Collateral Agent (as directed in accordance with
the Intercreditor Agreement) may agree in writing shall not constitute
Collateral.

Financing Documents has the meaning set forth in the Intercreditor Agreement.

GAAP means generally accepted accounting principles at the time in the United
States.

General Intangibles means: (a) any “general intangibles”, as such term is
defined in Section 9.102(a)(42) of the UCC; and (b) all interest rate or
currency protection or hedging arrangements, computer software, computer
programs, all Tax refunds and Tax refund claims, all licenses, permits,
concessions, and authorizations, all contract rights, all joint venture
interests, partnership interests, or membership interests that do not constitute
a security, all Material Agreements, and all Intellectual Property (in each
case, regardless of whether characterized as general intangibles under the UCC).

Governmental Approvals means all authorizations, consents, approvals, licenses,
and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.

Governmental Authority means any national, state, or local government (whether
domestic or foreign), any political subdivision thereof or any other
governmental, quasi-governmental, judicial, public, or statutory
instrumentality, authority, body, agency, bureau, or entity (including, without
limitation, the Federal Deposit Insurance Corporation, the Comptroller of the
Currency, or the Federal Reserve Board, any central bank, or any comparable
authority) or any arbitrator with authority to bind a party at law.

Grantor’s Knowledge means the actual knowledge of the senior officers set forth
on Schedule 1.1 hereto.

Grantors has the meaning set forth in the Preamble.

Instrument means any “instrument”, as such term is defined in
Section 9.102(a)(47) of the UCC, including the Collateral Notes.

Intellectual Property means, collectively, the Copyrights, the Copyright
Licenses, the Patents, the Patent Licenses, the Trademarks, the Trademark
Licenses, the Trade Secrets, and the Trade Secret Licenses.

Interest Rate Agreement means any interest rate swap agreement, interest rate
cap agreement, interest rate collar agreement, foreign exchange contract,
currency swap agreement, repurchase agreement, or other similar contractual
agreement or arrangement entered into for the purpose of protecting against
fluctuations in interest rates or in currency values.

Intercreditor Agreement has the meaning set forth in the Recitals.

Investment means, with respect to any Person, and whether or not such investment
constitutes a controlling interest in such Person, (a) the purchase or other
acquisition of any share of capital stock, evidence of indebtedness, or other
security issued by any other Person; (b) any loan, advance, or extension of
credit to, or contribution (in the form of money or goods) to the capital of, or
the acquisition of a sale leaseback asset from and the lease thereof to, any
other Person; (c) any guaranty of the indebtedness of any other Person; (d) any
other investment in any other Person; and (e) any commitment or option to make
an Investment in any other Person.

Investment Related Property means: (a) any “investment property”, as such term
is defined in Section 9.102(a)(49) of the UCC; and (b) all Pledged Equity
Interests (regardless of whether such interest is classified as investment
property under the UCC).

LC means the letter(s) of credit issued pursuant to the terms and conditions of
the Credit Agreement or other Bank Loan Documents.

LC Issuer means Bank of America, N.A., its permitted successors as “LC Issuer”
under the Credit Agreement and each other entity that may hereafter be a “LC
Issuer” under the Credit Agreement.

Lenders has the meaning set forth in the Recitals.

Lien means, as applied to the property of any Person, (a) any security interest,
encumbrance, mortgage, deed to secure indebtedness, deed of trust, pledge, lien,
charge, ground lease, or lease constituting a Capitalized Lease Obligation,
conditional sale, or other title retention agreement, or other security title or
encumbrance of any kind in respect of any property of such Person, or upon the
income or profits therefrom and (b) any arrangement, express or implied, under
which any property of such Person is transferred, sequestered, or otherwise
identified for the purpose of subjecting the same to the repayment of
indebtedness or performance of any other obligation in priority to the payment
of the general, unsecured creditors of such Person.

Material Adverse Effect means a material adverse effect on (a) the business,
operations, affairs, financial condition, assets or properties of Borrower and
its Consolidated Subsidiaries taken as a whole, or (b) the ability of Borrower
to perform its material obligations under (i) this Security Agreement, (ii) the
Note Agreement, (iii) the Intercreditor Agreement, (iv) the Credit Agreement or
(v) the remaining Financing Documents (taken as a whole for all such remaining
Financing Documents), or (c) the validity or enforceability of (i) this Security
Agreement, (ii) the Note Agreement, (iii) the Intercreditor Agreement, (iv) the
Credit Agreement or (v) the remaining Financing Documents (taken as a whole for
all such remaining Financing Documents), or (d) the value of the Collateral,
taken as a whole, or the validity or the perfection of the Security Interest.

Material Agreements means (a) all of Grantors’ rights, titles, and interests in,
to, and under any managing, consulting or servicing contracts or other similar
agreements pursuant to which any Grantor is entitled to be compensated for
managing, consulting or servicing services, in an annual amount in excess of
$750,000; (b) any other agreement or contract that is material to the business
operations of Borrower and its Consolidated Subsidiaries, taken as a whole;
(c) all rights of any Grantor to receive moneys due and to become due under or
pursuant to any agreements described in (a) or (b) above; (d) all rights of
Grantors to receive proceeds of any insurance, indemnity, warranty, or guaranty
with respect to any agreements described in (a) or (b) above; (e) all claims of
Grantors for damages arising out of or for breach of or default under any
agreements described in (a) or (b) above; and (f) all rights of Grantors to
compel performance and otherwise exercise all rights and remedies under any
agreements described in (a) or (b) above.

Net Proceeds has the meaning set forth in the in the Intercreditor Agreement.

Note Agreement has the meaning set forth in the Recitals.

Noteholders has the meaning set forth in the Intercreditor Agreement.

Notes has the meaning set forth in the Intercreditor Agreement.

Obligor means any Person obligated with respect to any of the Collateral,
whether as an account debtor, obligor on an instrument, issuer of securities, or
otherwise.

Patent Licenses means all agreements providing for the granting of any right in
or to Patents (whether a Grantor is licensee or licensor thereunder), including
each agreement referred to on Schedule 3.16.

Patents means all United States and foreign patents, certificates of invention,
or similar industrial property rights, and applications for any of the
foregoing, including: (a) each patent and patent application referred to on
Schedule 3.16; (b) all reissues, divisions, continuations,
continuations-in-part, extensions, renewals, and reexaminations thereof; (c) all
rights corresponding thereto throughout the world; (d) all inventions and
improvements described therein; (e) all rights to sue for past, present and
future infringements thereof; (f) all licenses, claims, damages, and proceeds of
suit arising therefrom; and (g) all products and proceeds of the foregoing,
including any income, royalties, and awards and any claim by any Grantor against
third parties for past, present, or future infringement of any Patent or any
Patent licensed under any Patent License.

Perfection Requirement means, (x) with respect to any Second Tier Collateral,
following the occurrence and during the continuance of an Event of Default, the
requirement to perfect the Liens and Security Interests granted hereunder with
respect to such Second Tier Collateral pursuant to Section 4.19.3, (y) with
respect to any Real Property not subject to Section 4.20, following the
occurrence and during the continuance of an Event of Default, the requirement to
grant a mortgage on such Real Property pursuant to Section 4.19.3, and (z) with
respect to any Excess Collateral, the requirement to perfect the Liens and
Security Interests granted hereunder with respect to such Excess Collateral
pursuant to Section 4.19.4, in each of cases (x), (y) and (z), within the time
frames set forth in Section 4.19.3 and 4.19.4 (as applicable).

Permitted Liens means any Lien that is permitted under both (i) Section 12.8 of
the Note Agreement and (ii) Section 9.3 of the Credit Agreement.

Permitted Preferred Stock means preferred stock that is issued from time to time
by a Subsidiary for the purpose of qualifying such Subsidiary as a real estate
investment trust under Sections 856 through 860 of the Internal Revenue Code and
having an aggregate stated value not exceeding $500,000 at any one time
outstanding; provided that, in any event Permitted Preferred Stock shall not
include any voting stock.

Person means an individual, corporation, partnership, limited liability company,
association, trust or unincorporated organization, or a government or any agency
or political subdivision thereof.

Pledge LLC means one or more Wholly Owned Consolidated Subsidiaries of any
Grantor, each of which (i) has title to personal property which would constitute
Collateral but for limitations in the documents which govern such personal
property, or has title to real property, (ii) has no indebtedness outstanding
other than (x) indebtedness owing to Borrower, which has been reflected as
intercompany indebtedness on its books and records or is evidenced by a
promissory note and the holder thereof has pledged the same to the Collateral
Agent pursuant to this Security Agreement and any other applicable Collateral
Document, and (y) guaranties of the Senior Secured Obligations, and (iii) has
had all of its Equity Interests owned by its members pledged to the Collateral
Agent as Collateral.

Pledged Equity Interests means all Pledged Stock, Pledged LLC Interests, and
Pledged Partnership Interests.

Pledged LLC Interests means all interests owned by a Grantor in any limited
liability company, including all limited liability company interests listed on
Schedule 3.8 and the certificates, if any, representing such limited liability
company interests and any interest of such Grantor on the books and records of
such limited liability company or on the books and records of any securities
intermediary pertaining to such interest and all dividends, distributions, cash,
warrants, rights, options, instruments, securities and other property or
proceeds from time to time received, receivable, or otherwise distributed in
respect of or in exchange for any or all of such limited liability company
interests.

Pledged Partnership Interests means all interests owned by a Grantor in any
general partnership, limited partnership, limited liability partnership or other
partnership, including all partnership interests listed on Schedule 3.8 and the
certificates, if any, representing such partnership interests and any interest
of such Grantor on the books and records of such partnership or on the books and
records of any securities intermediary pertaining to such interest and all
dividends, distributions, cash, warrants, rights, options, instruments,
securities and other property or proceeds from time to time received,
receivable, or otherwise distributed in respect of or in exchange for any or all
of such partnership interests.

Pledged Stock means all shares of capital stock owned by a Grantor, including
all             shares of capital stock described on Schedule 3.8, and the
certificates, if any, representing such shares and any interest of such Grantor
in the entries on the books of the issuer of such shares or on the books of any
securities intermediary pertaining to such             shares, and all
dividends, distributions, cash, warrants, rights, options, instruments,
securities, and other property or proceeds from time to time received,
receivable, or otherwise distributed in respect of or in exchange for any or all
of such shares.

Portfolio Company means any Person that is accounted for under GAAP as a
portfolio Investment of Borrower or a Consolidated Subsidiary of Borrower.

Real Property means any estates or interests in real property held in fee simple
now owned or hereafter acquired by any Grantor or any Subsidiary of any Grantor
and the improvements thereto.

Receivables means the accounts, chattel paper, documents, Investment Related
Property, Instruments, or commercial tort claims, and any other rights or claims
to receive money which are General Intangibles or which are otherwise included
as Collateral, together with all of the applicable Grantor’s rights, if any, in
all Collateral Support and Supporting Obligations related thereto.

Required Noteholders has the meaning set forth in the Intercreditor Agreement.

Required Secured Creditors has the meaning set forth in the Intercreditor
Agreement.

Second Tier Collateral means Collateral pledged hereunder to the extent such
Collateral falls below the following minimum thresholds required for perfection:
(a) the Deposit Accounts, Securities Accounts and Custodial Accounts identified
on Schedules 3.9 and 3.10 as “Second Tier Collateral” to the extent that the
balance (including any assets held therein) of such accounts is an amount less
than $2,500,000 in the aggregate, (b) items of Intellectual Property that are
valued on the books of Grantors in an amount less than $2,500,000 in the
aggregate, (c) letters of credit with an undrawn amount of less than $1,000,000
in the aggregate, (d) commercial tort claims where the amount claimed is less
than $1,000,000 in the aggregate, and (e) Vehicles owned by the Grantors with a
value in an amount less than $1,000,000 in the aggregate; provided, that,
(x) the Collateral listed in the foregoing clauses (a)-(e) shall constitute
“Second Tier Collateral” solely to the extent that the total value of such
Collateral is less than $10,000,000 in the aggregate, and (y) to the extent that
the value of any such Collateral exceeds (i) $10,000,000 in the aggregate, or
(ii) any of the individual sublimits set forth in the foregoing clauses (a)-(e),
the Collateral with values in excess of such amounts in clauses (i) or
(ii) above (such Collateral, the “Excess Collateral”) shall no longer constitute
“Second Tier Collateral.”

Secured Obligations means the Senior Secured Obligations, whether or not
(a) such Senior Secured Obligations arise or accrue before or after the filing
by or against any Grantor of a petition under the Bankruptcy Code, or any
similar filing by or against any Grantor under the laws of any jurisdiction, or
any bankruptcy, insolvency, receivership or other similar proceeding, (b) such
Senior Secured Obligations are allowable under Section 502(b)(2) of the
Bankruptcy Code or under any other insolvency proceedings, (c) the right of
payment in respect of such Senior Secured Obligations is reduced to judgment, or
(d) such Senior Secured Obligations are liquidated, unliquidated, similar,
dissimilar, related, unrelated, direct, indirect, fixed, contingent, primary,
secondary, joint, several, or joint and several, matured, disputed, undisputed,
legal, equitable, secured, or unsecured.

Secured Parties means the Administrative Agent, the Collateral Agent, the
Lenders, the Noteholders, the LC Issuer, the Cash Management Banks, each
co-agent or sub-agent appointed by the Administrative Agent from time to time
pursuant to the Credit Agreement and each co-agent or sub-agent appointed by the
Collateral Agent from time to time under the Intercreditor Agreement.

Securities Account means any “securities account”, as such term is defined in
Section 8.501(a) of the UCC, and all sub-accounts thereof.

Securities Account Control Agreement means any Control Agreement that
establishes Control with respect to a Securities Account.

Securities Act means, collectively, the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder

Security Interest means the security interest granted and the pledge and
assignment made under Section 2.1.

Senior Financial Officer means the chief financial officer, chief operating
officer, chief accounting officer, treasurer or controller of the Borrower.

Senior Secured Obligations has the meaning set forth in the Intercreditor
Agreement.

Special Collateral Account has the meaning set forth in the Intercreditor
Agreement.

Special Event of Default has the meaning set forth in the Intercreditor
Agreement.

Subsidiary means, for any Person, any corporation, partnership, limited
liability company, or other entity of which at least a majority of the
securities or other ownership interests having by the terms thereof ordinary
voting power to elect a majority of the board of directors or other Persons
performing similar functions of such corporation, partnership, limited liability
company, or other entity (without regard to the occurrence of any contingency)
is at the time directly or indirectly owned or controlled by such Person or one
or more Subsidiaries of such Person or by such Person and one or more
Subsidiaries of such Person. Notwithstanding the foregoing, for purposes hereof,
no Portfolio Company shall be deemed a “Subsidiary” of Borrower or any of its
Subsidiaries.

Supporting Obligations means all “supporting obligations” as defined in
Section 9.102(a)(77) of the UCC.

Taxes means, for any Person, taxes, assessments, duties, imposts, or other
governmental charges, deductions, withholdings, or levies imposed upon such
Person, its income, or any of its properties, franchises, or assets, and all
liabilities with respect thereto.

Trademark Licenses means any and all agreements providing for the granting of
any right in or to Trademarks (whether a Grantor is licensee or licensor
thereunder), including each agreement referred to on Schedule 3.16.

Trademarks means all United States and foreign trademarks, trade names,
corporate names, company names, business names, fictitious business names,
Internet domain names, service marks, certification marks, collective marks,
logos, other source or business identifiers, designs and general intangibles of
a like nature, all registrations and applications for any of the foregoing,
including: (a) the registrations and applications referred to on Schedule 3.16;
(b) all extensions or renewals of any of the foregoing; (c) all of the goodwill
of the business connected with the use of and symbolized by the foregoing;
(d) the right to sue for past, present and future infringement or dilution of
any of the foregoing or for any injury to goodwill; and (e) all products and
proceeds of the foregoing, including any income, royalties, and awards and any
claim by any Grantor against third parties for past, present, or future
infringement of any Trademark or any Trademark licensed under any Trademark
License.

Trade Secret Licenses means any and all agreements providing for the granting of
any right in or to Trade Secrets (whether a Grantor is licensee or licensor
thereunder), including each agreement referred to on Schedule 3.16.

Trade Secrets means all trade secrets and all other confidential or proprietary
information and know-how, whether or not such Trade Secret has been reduced to a
writing or other tangible form, including all documents and things embodying,
incorporating, or referring in any way to such Trade Secret, including: (a) the
right to sue for past, present and future misappropriation or other violation of
any Trade Secret; and (b) all products and proceeds of the foregoing, including
any income, royalties, and awards and any claim by any Grantor against third
parties for past, present, or future infringement of any Trade Secrets or any
Trade Secrets licensed under any Trade Secret License.

Triggering Event means the occurrence and continuance of an Event of Default and
the provision of an Enforcement Direction by the requisite Secured Parties
permitted in accordance with the Intercreditor Agreement, directing Collateral
Agent to take (or forbear from taking) certain actions or to exercise (or to
forbear from exercising) certain rights or remedies. The words “continuing” or
continuation” or any derivation thereof, when used with reference to a
Triggering Event, shall mean either that the Event of Default giving rise to
such Triggering Event shall be continuing, or that the applicable Enforcement
Direction by the requisite Secured Parties has not been fully carried out and
has not been rescinded, or both.

Vehicles means all automobiles, trucks, truck tractors, trailers, semi-trailers,
or other motor vehicles or rolling stock.

Wholly Owned means, when used in connection with any Subsidiary, any
corporation, partnership, limited liability company, or other entity of which
all of the equity securities or other ownership interests (other than Permitted
Preferred Stock and, in the case of a corporation, directors’ qualifying shares)
are so owned or controlled.

UCC and Uniform Commercial Code each means the Uniform Commercial Code as
adopted in the applicable jurisdiction from time to time.

1.2. Principals of Construction. References in this Security Agreement to
“Sections,” “Exhibits,” and “Schedules” are to sections, exhibits, and schedules
in this Security Agreement unless otherwise indicated. References in this
Security Agreement to any document, instrument, or agreement (a) shall include
all exhibits, schedules, and other attachments thereto, (b) shall include all
documents, instruments, or agreements issued or executed in replacement thereof,
to the extent permitted hereby, and (c) shall mean such document, instrument, or
agreement, or replacement or predecessor thereto, as amended, supplemented,
restated, or otherwise modified from time to time to the extent permitted hereby
and by any applicable Financing Document and in effect at any given time.
Wherever from the context it appears appropriate, each term stated in either the
singular or plural shall include the singular and plural, and pronouns stated in
the masculine, feminine, or neuter gender shall include the masculine, the
feminine and the neuter. Any reference herein to any Person shall be construed
to include such Person’s successors and assigns. The words “include”, “includes”
and “including” shall be deemed to be followed by the phrase “without
limitation”. Furthermore, any reference to any law shall include all statutory
and regulatory provisions consolidating, amending, replacing, or interpreting
such law, and any reference to any law or regulation shall, unless otherwise
specified, refer to such law or regulation as amended, modified, or supplemented
from time to time. Titles and captions of sections, subsections, and clauses in
this Security Agreement are for convenience only, and neither limit nor amplify
the provisions of this Security Agreement.

ARTICLE II
GRANT OF SECURITY INTEREST

2.1. Security Interest. To secure the prompt and complete payment and
performance of the Secured Obligations when due, whether at stated maturity, by
required prepayment, declaration, acceleration, demand or otherwise (including
the payment of amounts that would become due but for the operation of the
automatic stay under Section 362(a) of the Bankruptcy Code or any similar
provisions of other Applicable Law), each Grantor hereby grants (subject to the
last paragraph of this Section 2.1) to Collateral Agent (for the benefit of the
Secured Parties) a continuing security interest in, a Lien upon, and a right of
set off against, and hereby pledges, collaterally transfers and assigns to
Collateral Agent (for the benefit of the Secured Parties) as security, all
personal property of such Grantor, whether now owned or hereafter acquired or
existing, and wherever located (together with all other collateral security for
the Secured Obligations at any time granted to or held or acquired by or under
the Control of Collateral Agent, collectively, the “Collateral”), including:

2.1.1. All personal property and fixture property of every kind and nature
including, without limitation, all accounts, chattel paper (whether tangible or
electronic), goods (including inventory), equipment (and any accessions
thereto), software (specifically including, but not limited to, all accounting
software), Instruments, investment property, documents, Deposit Accounts,
Securities Accounts, Commodities Accounts, Custodial Accounts, money, commercial
tort claims, letter-of-credit rights, supporting obligations, Tax refunds, and
General Intangibles (including payment intangibles);

2.1.2. All promissory notes and other Instruments payable to any Grantor,
including, without limitation, all inter-company notes from Subsidiaries and
those set forth on Schedule 3.8 (“Collateral Notes”) and all Liens under all
present and future loan agreements, security agreements, pledge agreements,
deeds of trust, mortgages, guarantees, or other documents assuring or securing
payment of or otherwise evidencing the Collateral Notes (“Collateral Note
Security”);

      2.1.3.
2.1.4.
2.1.5.
2.1.6.  
All Material Agreements;
All Investment Related Property;
All Intellectual Property;
All Vehicles;

2.1.7. All present and future distributions, income, increases, profits,
combinations, reclassifications, improvements, and products of, accessions,
attachments, and other additions to, tools, parts, and equipment used in
connection with, and substitutes and replacements for, all or part of the
Collateral described above;

2.1.8. All present and future security for the payment to any Grantor of any of
the Collateral described above and goods which gave or will give rise to any
such Collateral or are evidenced, identified, or represented therein or thereby;

2.1.9. All products and proceeds of the Collateral listed above (including, but
not limited to, all claims to items referred to in the Collateral listed above)
and (x) all claims of any Grantor against third parties for (i) loss of, damage
to, or destruction of, and (ii) payments due or to become due under leases,
rentals and hires of, any or all of the Collateral listed above and (y) proceeds
payable under, or unearned premiums with respect to, policies of insurance in
whatever form; and

2.1.10. To the extent not otherwise included above, all Collateral Records and
Supporting Obligations relating to any of the foregoing.

Notwithstanding anything herein to the contrary, in no event shall the Security
Interest granted in this Section 2.1 attach to, or the term “Collateral” be
deemed to include, any of the Excluded Assets; provided that, if such Excluded
Assets are being excluded as a result of the grant of any security interest
therein being prohibited by the documents governing or creating such interest,
such Excluded Assets (or proceeds thereof) shall not be excluded and shall
constitute “Collateral” to the extent that any consent or waiver to such
prohibition has been obtained or any such prohibition would be rendered
ineffective pursuant to Sections 9-406, 9-407, 9-408, or 9-409 of the UCC (or
any successor provision or provisions) of the jurisdiction the UCC of which
would govern such determination (unless the application of Sections 9-406,
9-407, 9-408, or 9-409 of the UCC would automatically result in (x) additional
affirmative obligations on the part of any Grantor or (y) the granting of rights
and remedies not previously held to, or exercise of rights or remedies not
previously entitled to be exercised by, third parties, in which event such
assets shall remain “Excluded Assets”) or any other Applicable Law (including
the Bankruptcy Code) or principles of equity. In addition, the Collateral shall
not include the outstanding capital stock of a Controlled Foreign Corporation in
excess of 65% of the voting power of all classes of capital stock of such
Controlled Foreign Corporation entitled to vote; provided that immediately upon
the amendment of the Internal Revenue Code to allow the pledge of a greater
percentage of the voting power of capital stock in a Controlled Foreign
Corporation without adverse Tax consequences, the Collateral shall include, and
the Security Interest shall attach to, such greater percentage of capital stock
of each Controlled Foreign Corporation. Furthermore, notwithstanding any
contrary provision, each Grantor agrees that, if, but for the application of
this Section 2.1, granting a security interest in the Collateral would
constitute a fraudulent conveyance under 11 U.S.C. § 548 or a fraudulent
conveyance or transfer under any state fraudulent conveyance, fraudulent
transfer, or similar Law in effect from time to time (each a “fraudulent
conveyance”), then, to the extent permitted by Applicable Law, the Security
Interest remains enforceable to the maximum extent possible without causing such
Security Interest to be a fraudulent conveyance, and this Security Agreement is
automatically amended to carry out the intent of this sentence.

2.2. Authorization to File Financing Statements. Each Grantor shall have filed,
caused to be filed or authorized the filing of any initial financing statements
and amendments thereto that (a) indicate the Collateral (i) as all assets of
such Grantor or words of similar effect, regardless of whether any particular
asset comprised in the Collateral falls within the scope of Article 9 of the
UCC, or (ii) as being of an equal or lesser scope or with greater detail, and
(b) contain any other information required by subchapter E of Article 9 of the
UCC for the sufficiency or filing office acceptance of any financing statement
or amendment, including (A) whether such Grantor is an organization, the type of
organization and any organization identification number issued to such Grantor
and (B) in the case of a financing statement filed as a fixture filing or
indicating Collateral as as-extracted collateral or timber to be cut, a
sufficient description of real property to which the Collateral relates. Each
Grantor agrees to furnish any such information reasonably requested by
Collateral Agent (as directed in accordance with the Intercreditor Agreement),
promptly upon request, that is necessary to effectuate the provisions of this
Section 2.2. Any failure to file any initial financing statements or amendments
thereto shall not impair the validity or enforceability of this Security
Agreement against the Grantors. From time to time thereafter, the Grantors shall
file, cause to be filed or authorize the filing of such financing statements and
shall file, cause to be filed or authorize the filing of such continuation
statements, all in such manner and in such places as may be required by law
fully to preserve, maintain and protect the interest of the Collateral Agent and
Secured Parties under this Security Agreement in the Collateral and in the
proceeds thereof. To the extent any Grantor files any financing statements in
respect of the Collateral, such Grantor shall deliver (or cause to be delivered)
to the Collateral Agent file stamped copies of, or filing receipts for, any
document filed as provided above, as soon as available following such filing. In
the event that the Grantor fails to perform its obligations under this
subsection, the Collateral Agent may do so, in each case at the expense of the
Grantor.

2.3. Release of Collateral. No Collateral shall be released from the Security
Interest except in accordance with the terms, conditions and procedures set
forth in Section 3.4 of the Intercreditor Agreement. The Collateral Agent shall
release its Lien on Collateral to the extent required by Section 3.4 of the
Intercreditor Agreement.

ARTICLE III
REPRESENTATIONS AND WARRANTIES

Each Grantor represents and warrants to Collateral Agent and the Secured Parties
that:

3.1. Financing Documents. Each representation and warranty in the Financing
Documents (other than this Security Agreement) to which such Grantor is a party
that is by its terms applicable to such Grantor or its assets or operations, is
true and correct in all material respects (except to the extent already
qualified by materiality, in which case such representation and warranty shall
be true and correct in all respects) as of the date hereof (except to the extent
such representation or warranty relates solely to an earlier date, in which case
such representation and warranty shall have been true and correct on and as of
such earlier date).

3.2. Title; Authorization; Enforceability; Perfection. (a) Each Grantor has good
and valid rights in and title to the Collateral with respect to which it has
purported to grant a Security Interest hereunder, to each Grantor’s Knowledge,
free and clear of all Liens except for Permitted Liens, and has all necessary
power and authority to grant to Secured Party the Security Interest in such
Collateral; (b) the execution and delivery by each Grantor of this Security
Agreement has been duly authorized, and this Security Agreement constitutes a
legal, valid, and binding obligation of such Grantor and creates a Security
Interest enforceable against such Grantor in all now owned and hereafter
acquired Collateral except as enforcement may be limited by equitable principles
or by bankruptcy, insolvency, reorganization, moratorium, or similar laws
relating to or limiting creditors’ rights generally; (c) (i) upon the filing of
all UCC financing statements naming each Grantor as “debtor” and Secured Party
as “secured party” and describing the Collateral in the filing offices set forth
opposite such Grantor’s name on Schedule 3.5 hereof, (ii) upon delivery of all
Instruments, chattel paper, certificated Pledged Equity Interests, and
Collateral Notes (in each case, unless constituting Second Tier Collateral or
Excluded Assets) to Collateral Agent, or if delivered to a Custodian for deposit
in a Custodial Account, upon execution of a Custody Control Agreement
establishing Collateral Agent’s Control with respect to any such Custodial
Accounts, (iii) upon sufficient identification of commercial tort claims (unless
constituting Second Tier Collateral or Excluded Assets), (iv) upon execution of
a Control Agreement establishing Collateral Agent’s Control with respect to any
Deposit Account, Securities Account, Commodity Account, Custodial Account, or
uncertificated Pledged Equity Interest (in each case, unless constituting Second
Tier Collateral or Excluded Assets), (v) upon consent of the issuer or any
nominated Person with respect to letter of credit rights (unless constituting
Second Tier Collateral or Excluded Assets), and (vi) to the extent not subject
to Article 9 of the UCC, upon recordation of the Security Interests granted
hereunder in Intellectual Property (unless constituting Second Tier Collateral
or Excluded Assets) in the applicable intellectual property registries,
including the United States Patent and Trademark Office and the United States
Copyright Office, the Security Interests granted to Collateral Agent hereunder
constitute valid and perfected (other than in respect of Collateral constituting
Second Tier Collateral or Excluded Assets) Liens (and to each Grantor’s
Knowledge, first priority Liens, subject in the case of priority only to
Permitted Liens).

3.3. Conflicting Legal Requirements and Contracts. Except as set forth on
Schedule 3.3, neither the execution and delivery by any Grantor of this Security
Agreement, the creation and perfection of the Security Interest in the
Collateral, nor compliance by such Grantor with the terms and provisions hereof
will (a) violate (i) any legal requirement binding on such Grantor, (ii) such
Grantor’s organizational documents, or (iii) to such Grantor’s Knowledge, the
provisions of any indenture, instrument, or agreement to which such Grantor is a
party or is subject, or by which it, or its property, is bound; or (b) to such
Grantor’s Knowledge, conflict with or constitute a default under, or result in
the creation or imposition of any Lien pursuant to, the terms of any such
indenture, instrument, or agreement (other than any Lien of a Secured Party),
which in the case of clauses (a)(i), (a)(iii) or (b), would reasonably be
expected to have a Material Adverse Effect.

3.4. Governmental Authority. To each Grantor’s Knowledge, after reasonable
inquiry, no authorization, approval, or other action by, and no notice to or
filing with, any Governmental Authority is required for the pledge by any
Grantor of the Collateral pursuant to this Security Agreement or for the
execution, delivery, or performance of this Security Agreement by any Grantor
(other than the filing of financing statements on Form UCC-1 as provided for
herein).

3.5. Grantor Information. Each Grantor’s exact legal name, jurisdiction of
organization, type of entity, state issued organizational identification number,
and the location of its principal place of business or chief executive office
are disclosed on Schedule 3.5; no Grantor has any other places of business
except those set forth on Schedule 3.5. No Grantor has done in the last five
(5) years, or currently does, business under any other name (including any
trade-name or fictitious business name) except for those names set forth on
Schedule 3.5. Except as provided on Schedule 3.5, no Grantor has changed its
name, jurisdiction of organization, principal place of business, or chief
executive office (or principal residence if such Grantor is a natural Person) or
its corporate structure in any way (e.g., by merger, consolidation, change in
corporate form or otherwise) within the past five (5) years.

3.6. Property Locations. The location of each Grantor’s books and records are
located solely at the locations described on Schedule 3.6 (provided that
duplicate copies may be located at other locations).

3.7. No Financing Statements or Control Agreements. Other than the financing
statements and Control Agreements with respect to this Security Interest, there
are no other Control Agreements or to each Grantor’s Knowledge, financing
statements covering any Collateral, other than those evidencing Permitted Liens
and those financing statements set forth on Schedule 3.7 hereto.

3.8. Collateral. Schedule 3.8 lists all Pledged Equity Interests, Collateral
Notes, Collateral Note Security (which for purposes of this Schedule 3.8 shall
include only the documents evidencing loans or other indebtedness owed to a
Grantor to the extent not evidenced by a Collateral Note), commercial tort
claims, Material Agreements, and all letters of credit rights, in which any
Grantor has any right, title, or interest (other than Second Tier Collateral and
Excluded Assets), and is true, correct and complete in all material respects.
All information supplied by any Grantor to Collateral Agent or any Secured Party
with respect to any of the Collateral (in each case taken as a whole with
respect to any particular Collateral) is true, correct, and complete in all
material respects. Schedule 3.8 lists all Excluded Assets, and is true, correct
and complete in all material respects.

3.9. Deposit, Commodity, and Securities Accounts. Schedule 3.9 identifies all
Deposit Accounts, Commodity Accounts, and Securities Accounts constituting
Collateral and the institutions holding such accounts and whether any such
account constitutes Second Tier Collateral. Each Grantor is the sole account
holder of each such account, and such Grantor has not consented to, and is not
otherwise aware of, any Person (other than Collateral Agent and the financial
institution maintaining such account) having Control over, or any other interest
in (other than Permitted Liens), any such account or the property credited
thereto. The Control Agreement for each Deposit Account, Commodity Account, and
Securities Account (other than accounts constituting Second Tier Collateral) is
in full force and effect and is sufficient to create a valid, perfected and to
each Grantor’s Knowledge, first priority security interest in favor of
Collateral Agent in and to each such Deposit Account, Commodity Account, and
Securities Account, subject to Permitted Liens.

3.10. Custodial Accounts. (a) Schedule 3.10 accurately lists all Custodial
Accounts maintained by each Grantor and identifies (i) the institutions serving
as Custodian therefor and (ii) whether any such account constitutes Second Tier
Collateral. (b) Schedule 3.10 accurately lists the Custodial Collateral on
deposit in each Custodial Account listed therein as of the date listed therein.
(c) Each Grantor is the sole account holder of each Custodial Account maintained
by such Grantor, and has not consented to, and is not otherwise aware of any
Person (other than Collateral Agent and the financial institution maintaining
such account) having Control over any such account or Custodial Collateral
deposited and maintained therein. (d) To each Grantor’s Knowledge, all Custodial
Collateral on deposit in any Custodial Account is indicated on such Custodian’s
books as being credited to or recorded in such Custodial Account. The Custody
Control Agreement for each Custodial Account (other than any such account
constituting Second Tier Collateral) is in full force and effect and is
sufficient to create a valid, perfected and to each Grantor’s Knowledge, first
priority security interest in favor of Collateral Agent in the Custodial Account
and the Custodial Collateral held by the respective Custodian of such Custodial
Account, subject to the Permitted Liens.

3.11. Accounts; General Intangibles. To each Grantor’s Knowledge, all Collateral
that is accounts, contract rights, chattel paper, Collateral Notes, Collateral
Note Security, Instruments, payment intangibles, or General Intangibles is free
from any claim for credit, deduction, or allowance of an Obligor and free from
any claim, deduction, allowance, defense, condition, dispute, setoff, or
counterclaim, except, in each case, any such claim, deduction, allowance,
defense, condition, dispute, setoff, or counterclaim that arise in the ordinary
course of business and do not materially impair the value of the Collateral,
taken as a whole, or as set forth on Schedule 3.11.

3.12. Letter of Credit Rights. All letters of credit to which any Grantor has
rights are listed on Schedule 3.8 (other than those constituting Second Tier
Collateral), and with respect to any such letter of credit (other than those
constituting Second Tier Collateral), such Grantor has entered into a tri-party
agreement with Collateral Agent and the issuer or confirming bank with respect
to such letter-of-credit rights, assigning such letter-of-credit rights to
Collateral Agent and directing all payments thereunder to Collateral Agent (to
be applied to the Secured Obligations), subject to the terms and conditions of
such agreement, all in form and substance reasonably satisfactory to Collateral
Agent (to be determined in accordance with the terms of the Intercreditor
Agreement).

3.13. Instruments; Chattel Paper; Collateral Notes; and Collateral Note
Security. All chattel paper and Instruments constituting Collateral, including
the Collateral Notes, have been delivered to Collateral Agent or, in the case of
the Custodial Collateral, to a Custodian (which has executed and delivered a
Custody Control Agreement to Collateral Agent), together with corresponding
endorsements duly executed by the appropriate Grantor in favor of Collateral
Agent, and such endorsements have been duly and validly executed and are binding
and enforceable against such Grantor in accordance with their terms, except as
enforcement may be limited by equitable principles or by bankruptcy, insolvency,
reorganization, moratorium, or similar laws relating to or limiting creditors’
rights generally.

3.14. Material Agreements. All Material Agreements to which any Grantor is a
party are set forth on Schedule 3.8. True and correct copies of all such
Material Agreements have been furnished or made available to Collateral Agent.
To each applicable Grantor’s Knowledge, each Material Agreement is in full force
and effect. Except as set forth on Schedule 3.8, no Material Agreement prohibits
collateral assignment or pledge or requires consent of or notice to any Person
in connection with the collateral assignment or pledge to Collateral Agent
hereunder, other than those that have been received on or prior to the date
hereof.

3.15. Investment Related Property.

3.15.1. Schedule 3.8 sets forth all of the Pledged Stock, Pledged LLC Interests,
and Pledged Partnership Interests owned by any Grantor, and, to each Grantor’s
Knowledge, such Pledged Equity Interests constitute the percentage categories of
voting ownership set forth in Schedule 3.15.1 of (i) issued and outstanding
shares of stock, (ii) membership interests, (iii) partnership interests, or
(iv) beneficial interest, of the respective issuers thereof indicated on
Schedule 3.15.1.

3.15.2. Each Grantor is the record and beneficial owner of the Pledged Equity
Interests, owned by it, to each Grantor’s Knowledge, free of all Liens, rights,
or claims of other Persons other than Permitted Liens, and, in the case of
Pledged Equity Interests issued by a Consolidated Subsidiary and owned by such
Grantor, to each Grantor’s Knowledge there are no outstanding warrants, options,
or other rights to purchase, or shareholder, voting trust or similar agreements
outstanding with respect to, or property that is convertible into, or that
requires the issuance or sale of, any such Pledged Equity Interests, except as
set forth on Schedule 3.11.

3.15.3. No consent of any Person including any other general or limited partner,
any other member of a limited liability company, any other shareholder, or any
other trust beneficiary is necessary in connection with the creation or
perfection of the Security Interest in any Pledged Equity Interests, other than
(i) such consents as have been obtained and are in full force and effect and
(ii) Excluded Assets, so long as each Grantor is in compliance with
Sections 3.17 and 4.19.

3.15.4. To each Grantor’s Knowledge, none of the Pledged LLC Interests or
Pledged Partnership Interests are or represent interests in issuers that (a) are
registered as investment companies or (b) are dealt in or traded on securities
exchanges or markets.

3.15.5. Except as otherwise set forth on Schedule 3.11, all of the Pledged LLC
Interests issued by a Consolidated Subsidiary and owned by a Grantor are or
represent interests in issuers that have not opted to be treated as securities
under the uniform commercial code of any jurisdiction.

3.15.6. (a) With the exception of the Custodial Collateral, each Grantor has
delivered to Collateral Agent all stock certificates or other instruments or
documents representing or evidencing the Pledged Equity Interests, together with
corresponding assignment or transfer powers duly executed in blank by such
Grantor, and such powers have been duly and validly executed and are binding and
enforceable against such Grantor in accordance with their terms, except as
enforcement may be limited by equitable principles or by bankruptcy, insolvency,
reorganization, moratorium, or similar laws relating to or limiting creditors’
rights generally; and (b) to the extent such Pledged Equity Interests are
uncertificated or constitute Custodial Collateral, each Grantor has taken all
actions necessary to establish Collateral Agent’s Control over such Pledged
Equity Interests (other than with respect to clause (a) and (b), Pledged Equity
Interests constituting Second Tier Collateral or Excluded Assets).

3.16. Intellectual Property.

3.16.1. To each Grantor’s Knowledge, all of the Intellectual Property is
subsisting, valid, and enforceable. The information contained on Schedule 3.16
is true, correct, and complete in all material respects. All issued Patents,
Patent Licenses, Trademarks, Trademark Licenses, Copyrights, Copyright Licenses,
and Trade Secret Licenses of each Grantor are identified on Schedule 3.16.

3.16.2. To each Grantor’s Knowledge, each of the Patents and Trademarks
identified on Schedule 3.16 has been properly registered with the United States
Patent and Trademark Office and each of the Copyrights identified on
Schedule 3.16 has been properly registered with the United States Copyright
Office.

3.17. Consents; Pledge LLC.

3.17.1. Consents. Each Grantor has used, and shall continue to use, subject to
the provisions contained in this Section 3.17, commercially reasonable efforts
to obtain the consent or approval of, or other action by, all third parties
required to permit Grantors to subject all of their respective assets to the
Lien and Security Interest of this Security Agreement and the other Collateral
Documents; provided, however, that Grantors shall not be obligated to obtain
consents or approvals in respect of assets (a) where the value of such assets
would not reasonably justify the burden, costs and expenses necessary to obtain
such consent or approval; in making such a determination, Grantors may take into
account the cost or charges imposed by such third parties (on any Grantor or any
entity in which any Grantor has an Investment) to grant any such consent or
approval or take such other action and/or any undue burden, or (b) which in the
reasonable judgment of Grantors cannot be pledged, or as to which the consent to
pledge cannot be sought, without substantially impairing the value of the asset
or the ability of Grantors to manage the asset in the ordinary course of its
business; provided further that, nothing shall be deemed a waiver of any rights
Secured Parties may have to assert Liens or security interests in any such
assets or proceeds thereof to the extent permitted pursuant to Sections 9-406,
9-407, 9-408, or 9-409 of the UCC (or any successor provision or provisions) of
the jurisdiction the UCC of which would govern such determination (unless the
application of Sections 9-406, 9-407, 9-408, or 9-409 of the UCC would
automatically result in (x) additional affirmative obligations on the part of
any Grantor or (y) the granting of rights and remedies not previously held to,
or exercise of rights or remedies not previously entitled to be exercised by,
third parties, in which event such assets shall remain “Excluded Assets”) or any
other Applicable Law (including the Bankruptcy Code) or principles of equity.

3.17.2. Pledge LLC. Without limiting the obligations of any Grantor set forth in
this Section 3.17, to the extent that any personal property of any Grantor
cannot be pledged as Collateral on account of contractual limitations applicable
to such property but may be transferred to a Pledge LLC, such personal property
has been transferred to a Pledge LLC, other than the personal property listed on
Schedule 3.17.2. All membership interests in such Pledge LLC have been pledged
to Collateral Agent, creating a perfected, and to each Grantor’s Knowledge,
first priority, Lien and Security Interest therein, subject to Permitted Liens.

3.18. Real Property. Schedule 3.18 attached hereto sets forth all Real Property
owned in fee simple by Grantors as of the date hereof.

The failure of any of these representations or warranties or any description of
Collateral therein to be accurate or complete shall not impair the Security
Interest in any such Collateral.

ARTICLE IV
COVENANTS

From and after the date of this Security Agreement and until the Secured
Obligations are paid in full, all LCs have expired, been cancelled or cash
collateralized in an amount equal to 100% of the undrawn amount thereof, and
this Security Agreement is irrevocably terminated:

4.1. Financing Documents. Each Grantor shall in all material respects comply
with, perform, and be bound by all covenants and agreements in the Financing
Documents that are applicable to it, its assets, or its operations, each of
which is hereby ratified and confirmed.

4.2. General.

4.2.1. Inspection; Records and Reports. Borrower (for itself and on behalf of
each of its Consolidated Subsidiaries) will in all material respects keep
accurate and complete records of the Collateral (including proceeds), and these
records will reflect all material facts known to such Grantor concerning the
Collateral. Borrower (for itself and on behalf of each of its Consolidated
Subsidiaries) shall maintain, at the address set forth on Schedule 3.6 as the
location of the books and records, a current record of where Grantors’ material
Collateral is located, permit representatives of Collateral Agent or Secured
Parties at any time during normal business hours, upon reasonable notice, to
inspect and make abstracts from such records (provided, that so long as no Event
of Default shall have occurred and be continuing, Grantors shall not be
obligated to reimburse Collateral Agent for more than two (2) such inspections
during any calendar year), and furnish to Collateral Agent, at such intervals as
Collateral Agent may reasonably request, such documents, lists, descriptions,
certificates, and other information as may be necessary or proper to keep
Collateral Agent informed with respect to the identity, location, status,
condition, and value of the Collateral. In addition, from time to time at the
request of Collateral Agent or any Secured Party, Grantors shall deliver to
Collateral Agent such information regarding each Grantor as Collateral Agent may
reasonably request.

4.2.2. Asset Report Certificate. Within ten (10) Business Days after the end of
each calendar month, Borrower (for itself and on behalf of each of its
Consolidated Subsidiaries) shall deliver to Collateral Agent an Asset Report
Certificate, which lists on the attachments thereto: (i) all Dispositions made
by Borrower and its Consolidated Subsidiaries during the immediately preceding
calendar month, (ii) the amount and type of Net Proceeds received by Borrower
and its Consolidated Subsidiaries in connection with each such Disposition,
(iii) the amount of any mandatory prepayments using such Net Proceeds pursuant
to Section 10 of the Note Agreement and Section 2.6 of the Credit Agreement,
(iv) any Investment Related Property, Collateral Notes or Collateral Note
Security (which for such purpose shall only include the documents evidencing
loans or other Indebtedness owing to a Grantor to the extent not evidenced by a
Collateral Note) transferred to or from a Pledge LLC during the immediately
preceding calendar month and copies of any notices delivered or consents
obtained with respect thereto, if any, (v) any Investment Related Property or
Collateral Note Security re-characterized as “Pledged” or “Unpledged” by
Borrower during the immediately preceding calendar month, and (vi) any new
Investment Related Property, Collateral Notes or Collateral Note Security (which
for such purpose shall only include the documents evidencing loans or other
Indebtedness owing to a Grantor to the extent not evidenced by a Collateral
Note) acquired by any Grantor during the immediately preceding calendar month,
together with a certification as to whether any such asset constitutes Custodial
Collateral or Excluded Assets. Collateral Agent shall forward any Asset Report
Certificate to such other parties as required pursuant to the terms of the
Intercreditor Agreement. The delivery of the Asset Report Certificate and other
documents and information to Collateral Agent shall not constitute constructive
notice of any information contained therein or determinable from information
contained therein.

4.2.3. Financing Statements and Other Actions; Defense of Title. Each Grantor
will deliver to Collateral Agent all financing statements and execute and
deliver Control Agreements and other documents and take such other actions as
may from time to time be reasonably requested by Collateral Agent in order to
maintain (a) the priority status of and (b) perfected security interest in (and,
in the case of Investment Related Property, Custodial Collateral, Deposit
Accounts, Commodity Accounts, Securities Accounts, Custodial Accounts,
letter-of-credit-rights, and electronic chattel paper, Control of) such
Collateral (other than Second Tier Collateral that is not subject to a
Perfection Requirement), now owned or hereafter acquired. Each Grantor will take
any and all actions reasonably necessary to defend title to the Collateral
(other than Second Tier Collateral that is not subject to a Perfection
Requirement) against all Persons and to defend the Security Interest and the
priority thereof against any Lien not expressly permitted hereunder.

4.2.4. Disposition of Collateral. No Grantor will Dispose of the Collateral to
the extent prohibited by the Credit Agreement or the Note Agreement.

4.2.5. Liens. No Grantor will create, incur, or suffer to exist, and shall
defend Grantor’s rights in the Collateral and the Security Interest against, any
Lien on the Collateral except (a) the security interest created by this Security
Agreement, and (b) Permitted Liens.

4.2.6. Change in Location, Jurisdiction of Organization, or Name. No Grantor
will (a) maintain records relating to the Receivables at a location other than
at the location specified on Schedule 3.6 (provided that duplicate copies may be
located at other locations), (b) maintain a place of business at a location
other than a location specified on Schedule 3.6, (c) change its name or taxpayer
identification number, (d) change its mailing address, or (e) change its
jurisdiction of organization, in each case unless such Grantor shall have given
Collateral Agent not less than thirty (30) days’ prior written notice thereof.
Prior to making any of the foregoing changes, each Grantor shall execute and
deliver all such additional documents and perform all additional acts as
Collateral Agent or the Secured Parties may reasonably request in order to
continue or maintain the existence and priority of the Security Interest.

4.2.7. Notices. Each Grantor will promptly notify Collateral Agent of (a)  any
claim, action, or proceeding affecting title to any part of the Collateral or
the Security Interest, which in each case could reasonably be expected to have a
Material Adverse Effect, and, at the request of Collateral Agent (as directed in
accordance with the Intercreditor Agreement), appear in and defend, at such
Grantor’s expense, any such action or proceeding, (b) any damage to or loss of
Collateral that could reasonably be expected to have a Material Adverse Effect,
and (c) the occurrence of any other event or condition (including, without
limitation, matters as to Lien priority) that could reasonably be expected to
have a material adverse effect on the Collateral (taken as a whole) or the
Security Interest on the Collateral (taken as a whole).

4.2.8. Other Financing Statements. No Grantor will authorize any other financing
statement naming it as debtor covering any portion of the Collateral, other than
financing statements evidencing the Security Interest granted hereunder and
Permitted Liens.

4.2.9. Compliance with Agreements. Each Grantor shall comply with all mortgages,
deeds of trust, Instruments, and other agreements binding on its properties or
business, except for such non-compliance that could not reasonably be expected
to have a Material Adverse Effect.

4.3. Perform Obligations. Notwithstanding anything to the contrary contained
herein, (a) the execution and delivery of this Security Agreement shall not
affect each Grantor’s liability or obligations under its contracts, agreements,
documents, and instruments included in the Collateral to the extent set forth
therein, (b) the exercise by Collateral Agent of any of its rights or remedies
hereunder shall not release any Grantor from any of its duties or obligations
under the contracts, agreements, documents, and instruments included in the
Collateral, and (c) none of Collateral Agent or the Secured Parties shall have
any indebtedness, liability, or obligation under any of the contracts,
agreements, documents, and instruments included in such Collateral by reason of
the execution and delivery of this Security Agreement, and none of Collateral
Agent or the Secured Parties shall be obligated to perform any of the
obligations or duties of any Grantor thereunder (unless such Secured Party has
foreclosed on such Collateral) or to take any action to collect or enforce any
claim for payment assigned hereunder.

4.4. Investment Related Property.

4.4.1. Each Grantor will deliver to Collateral Agent: (i) all stock certificates
or other instruments, or documents representing or evidencing any Investment
Related Property constituting part of the Collateral (except in the case of
Custodial Collateral, in which case such Custodial Collateral shall be delivered
to a Custodian that has executed and delivered to Collateral Agent a Custody
Control Agreement), together with corresponding undated assignment or transfer
powers duly executed in blank by Grantor (which powers have been duly and
validly executed and are binding and enforceable against Grantor in accordance
with their terms, except as enforcement may be limited by equitable principles
or by bankruptcy, insolvency, reorganization, moratorium, or similar laws
relating to or limiting creditors’ rights generally) or (ii) to the extent any
such Investment Related Property is uncertificated and credited to a Securities
Account or Custodial Account (and is not already subject to a Control
Agreement), a Control Agreement entered into with the related securities
intermediary or Custodian, as applicable.

4.4.2. Certificated Interests. No Grantor shall vote to enable or take any other
action to cause any issuer of any Pledged Partnership Interests or Pledged LLC
Interests which are not securities (for purposes of the UCC) on the date hereof
to elect or otherwise take any action to cause such Pledged Partnership
Interests or Pledged LLC Interests to be treated as securities for purposes of
the UCC; provided, however, notwithstanding the foregoing, if any issuer of any
Pledged Partnership Interests or Pledged LLC Interests takes any such action,
such Grantor shall promptly after obtaining knowledge thereof notify Collateral
Agent in writing of any such election or action and, in such event, shall use
its commercially reasonable efforts taking into account the considerations
specified in Section 4.19 to establish Collateral Agent’s Control thereof.

4.4.3. Changes in Capital Structure of Issuers. Without the prior written
consent of Collateral Agent, no Grantor shall vote to enable or take any other
action to cause or permit any issuer of any Pledged Equity Interest to merge or
consolidate (except to the extent expressly permitted hereunder) unless all the
outstanding capital stock or other Equity Interests of the surviving or
resulting corporation, limited liability company, partnership, or other entity
which is issued to any Grantor is, upon such merger or consolidation, pledged
and perfected hereunder.

4.4.4. Consent of Grantor. Each Grantor consents to the grant by each other
Grantor of the Security Interest in all Investment Related Property to
Collateral Agent and, without limiting the foregoing, following the occurrence
of an Applicable Triggering Event (subject to Applicable Law), consents to the
transfer of any Pledged Partnership Interest and any Pledged LLC Interest to
Collateral Agent or its nominee and to the substitution of Collateral Agent or
its nominee as a partner in any partnership or as a member in any limited
liability company with all the rights and powers related thereto.

4.4.5. Voting of Pledged Equity Interests. Prior to the occurrence of an
Applicable Triggering Event, each Grantor is entitled to exercise all voting
rights and receive all dividends and distributions pertaining to any Pledged
Equity Interests; provided, however, that no vote shall be cast or consent,
waiver, or ratification given or action taken without the prior written consent
of Collateral Agent which would (x) violate any provision of this Security
Agreement or any other Financing Document or (y) amend, modify, or waive any
term, provision, or condition of the certificate of incorporation, bylaws,
certificate of formation, or other charter document, or other agreement relating
to, evidencing, providing for the issuance of, or securing any Collateral, which
amendment, modification, or waiver could be reasonably expected to have the
effect of restricting the grant of the Security Interest in or Lien on such
Collateral. After the occurrence and during the continuation of an Applicable
Triggering Event, Collateral Agent may, at its option, and with two (2) Business
Days’ prior notice to any Grantor, exercise all voting rights or take any other
action with respect to any Pledged Equity Interests, but under no circumstances
is Collateral Agent obligated by the terms of this Security Agreement to
exercise such rights. To this end, if Collateral Agent duly exercises its right
to vote any of such Pledged Equity Interests, each Grantor hereby irrevocably
constitutes and appoints Collateral Agent the proxy and attorney-in-fact of such
Grantor, with full power of substitution, to vote, and to act with respect to,
any and all Pledged Equity Interests standing in the name of such Grantor or
with respect to which such Grantor is entitled to vote and act, subject to the
agreement that such proxy may be exercised only if an Applicable Triggering
Event has occurred and is continuing. The proxy herein granted is coupled with
an interest, is irrevocable, and shall continue until the termination of this
Security Agreement pursuant to Section 6.1.

4.5. Collateral in Trust. Each Grantor will hold in trust for Collateral Agent
all Collateral that is chattel paper, Instruments, Collateral Notes, Investment
Related Property in certificated form, or documents at any time received by
Grantor, endorse each such Instrument to the order of Collateral Agent (but the
failure of the same to be so endorsed shall not impair the Security Interest
thereon), and promptly deliver same to Collateral Agent (except where the same
are required or permitted to be delivered to a Custodian, in which case such
Collateral shall be delivered to a Custodian that has executed and delivered a
Custody Control Agreement to Collateral Agent).

4.5.1. Control. Each Grantor will execute all documents and take any action
reasonably required in order for Collateral Agent to obtain Control with respect
to Collateral (other than Second Tier Collateral that is not subject to a
Perfection Requirement) consisting of Commodities Accounts, Securities Accounts,
Deposit Accounts, Custodial Accounts and Custodial Collateral, uncertificated
Investment Related Property, and “letter-of-credit rights”, and electronic
chattel paper. If any Grantor at any time holds or acquires an interest in any
electronic chattel paper or any “transferable record,” as that term is defined
in the federal Electronic Signatures in Global and National Commerce Act, or in
the Uniform Electronic Transactions Act as in effect in any relevant
jurisdiction, such Grantor shall promptly notify Collateral Agent thereof and
shall promptly take the appropriate action to vest in Collateral Agent control
under the UCC of such electronic chattel paper or control under the federal
Electronic Signatures in Global and National Commerce Act or, as the case may
be, the Uniform Electronic Transactions Act, as so in effect in such
jurisdiction, of such transferable record.

4.6. Intellectual Property.

4.6.1. Additional Intellectual Property. Each Grantor shall give Collateral
Agent prompt written notice if such Grantor shall obtain rights to or become
entitled to the benefit of any Intellectual Property not identified on
Schedule 3.16 (other than Second Tier Collateral that is not subject to a
Perfection Requirement). Each Grantor shall execute and deliver any and all
documents and shall provide to Collateral Agent an officer’s certificate
confirming that such execution and delivery are appropriate and complete to
evidence Collateral Agent’s lien on such Intellectual Property.

4.6.2. Obligation upon Default. After the occurrence and during the continuation
of an Applicable Triggering Event, each Grantor shall use its reasonable efforts
to obtain any consents, waivers, or agreements necessary to enable Collateral
Agent to exercise its rights and remedies with respect to the Intellectual
Property.

4.6.3. Intellectual Property Filings. Other than with respect to Intellectual
Property that constitutes Second Tier Collateral (to the extent not subject to a
Perfection Requirement), in order to facilitate filings with the United States
Patent and Trademark Office and the United States Copyright Office, each Grantor
shall execute and deliver to Collateral Agent one or more (i) Notice of Grant of
Security Interest in Copyrights in the form of Exhibit 4.6.3(i), (ii) Notice of
Grant of Security Interest in Trademarks in the form of Exhibit 4.6.3(ii), or
(iii) Notice of Grant of Security Interest in Patents in the form of
Exhibit 4.6.3(iii) to further evidence Collateral Agent’s Lien on such Grantor’s
Patents, Trademarks, or Copyrights, and the General Intangibles of such Grantor
relating thereto or represented thereby.

4.6.4. Intellectual Property Applications. Other than with respect to
Intellectual Property that constitutes Second Tier Collateral (to the extent not
subject to a Perfection Requirement), in no event shall any Grantor, either
itself or through any agent, employee, licensee, or designee, file an
application for the registration of any Copyright with the United States
Copyright Office without giving Collateral Agent prior written notice thereof or
any Patent or Trademark with the United States Patent and Trademark Office
without giving Collateral Agent written notice thereof promptly thereafter.

4.7. Collateral Notes and Collateral Note Security. After the occurrence and
during the continuation of an Applicable Triggering Event, without the prior
written consent of Collateral Agent, no Grantor may, except in the ordinary
course of business consistent with prudent business practices and industry
standards, vote to enable or take any other action to cause (i) the modification
or substitution of, any Collateral Note or any document evidencing the
Collateral Note Security or (ii) release any Collateral Note Security (other
than as permitted (or not expressly prohibited) by the Intercreditor Agreement
or as required by the terms of such Collateral Note Security).

4.8. Deposit, Commodity, Securities and Custodial Accounts. With respect to any
Deposit Account, Commodity Account, Securities Account or Custodial Account
(other than Second Tier Collateral that is not subject to a Perfection
Requirement), each Grantor shall (a) maintain such accounts at the institutions
described on Schedule 3.9 (and Schedule 3.10 in the case of Custodial Accounts)
or such additional institutions as to which such Grantor has complied with
clause (b) hereof; and (b) deliver to each depository bank and security
intermediary (or Custodian, in the case of a Custodial Account), a Control
Agreement (or in the case of a Custodial Account, a Custody Control Agreement),
with respect to each such account and obtain the execution of such Control
Agreements or Custody Control Agreements, as the case may be. Without Collateral
Agent’s consent, no Grantor shall hereafter establish any additional Deposit
Accounts, Securities Accounts, Commodities Accounts, or Custodial Accounts,
unless such accounts are subject to Collateral Agent’s exclusive Control.
Furthermore, no Grantor shall hereafter transfer any Collateral Notes,
Collateral Note Security, Pledged Equity Interests or Instruments from a
Custodial Account subject to a Custody Control Agreement to a Custodial Account
not subject to a Custody Control Agreement. For the avoidance of doubt, the
foregoing sentence only limits transfers of Collateral Notes, Collateral Note
Security, Pledged Equity Interests or Instruments to a Custodial Account not
subject to a Custody Control Agreement and does not limit the removal of such
assets from a Custodial Account in connection with a release of the Lien with
respect to such assets that is permitted under the Financing Documents. With
respect to each Custodial Account of a Grantor (including Custodial Accounts in
respect of Excluded Assets, Second Tier Collateral and Excess Collateral), such
Grantor shall promptly deliver, or cause to be promptly delivered, to Collateral
Agent upon receipt thereof, the monthly statement prepared by the Custodian with
respect to such Custodial Account. With respect to each Custodial Account held
by a Pledge LLC, the Borrower shall promptly deliver, or cause to be promptly
delivered, to Collateral Agent upon receipt thereof by such Pledge LLC, the
monthly statement prepared by the Custodian with respect to such Custodial
Account.

4.9. Commercial Tort Claims. If any Grantor at any time holds or acquires a
commercial tort claim (other than Second Tier Collateral that is not subject to
a Perfection Requirement), such Grantor shall (a) as promptly as practicable
forward to Collateral Agent written notification of any and all commercial tort
claims, including any and all actions, suits, and proceedings before any court
or Governmental Authority by or affecting such Grantor; and (b) execute and
deliver such statements, documents, and notices and do and cause to be done all
such things as may be reasonably required by Collateral Agent (as directed in
accordance with the Intercreditor Agreement), or required by Applicable Law,
including all things which may from time to time be necessary under the UCC to
fully create, preserve, perfect, and protect the priority of the Security
Interest in any commercial tort claims.

4.10. Letters-of-Credit Rights. If any Grantor is at any time a beneficiary
under a letter of credit (other than Second Tier Collateral that is not subject
to a Perfection Requirement) now or hereafter issued in favor of any Grantor,
such Grantor shall promptly notify Collateral Agent thereof in writing and such
Grantor shall enter into a tri-party agreement with Collateral Agent and the
issuer or confirming bank with respect to such letter-of-credit rights,
assigning such letter-of-credit rights to Collateral Agent and directing all
payments thereunder to Collateral Agent (to be applied to the Secured
Obligations), subject to the terms and conditions of such agreement, all in form
and substance reasonably satisfactory to Collateral Agent (to be determined in
accordance with the terms of the Intercreditor Agreement).

4.11. Material Agreements. Except in the ordinary course of business, consistent
with prudent business practices, each Grantor shall (i) promptly perform,
observe, and otherwise comply, in all material respects, with each covenant,
agreement, requirement, and condition set forth in the Material Agreements; and
(ii) do or cause to be done all things reasonably necessary to keep the Material
Agreements in full force and effect and the rights of Grantors and Collateral
Agent thereunder unimpaired in all material respects.

4.12. Modification of Accounts. Except in the ordinary course of business
consistent with prudent business practices and industry standards and so long as
an Applicable Triggering Event has occurred and is continuing, no Grantor shall
(i) grant any extension of time for any payment with respect to any of the
accounts, (ii) compromise, compound, or settle any of the accounts for less than
the full amount thereof, (iii) release, in whole or in part, any Person liable
for payment of any of the accounts, (iv) allow any credit or discount for
payment with respect to any account other than trade discounts granted in the
ordinary course of business, (v) release any Lien or guaranty securing any
account, or (vi) modify or substitute, or permit the modification or
substitution of, any contract to which any of the Collateral which is accounts
relates.

4.13. Estoppel and Other Agreements and Matters. Upon the request of the
Collateral Agent, each Grantor shall either (i) deliver to Collateral Agent,
with respect to each location of such Grantor’s books and records, a landlord
subordination, access and estoppel certificate, in form and substance reasonably
acceptable to the Collateral Agent (to be determined in accordance with the
terms of the Intercreditor Agreement), executed by the applicable landlord and
landlord’s mortgagee (if any), or (ii) move such Grantor’s books and records (or
accurate and up-to-date copies thereof) to a location with respect to which
Collateral Agent has previously received delivery of a landlord subordination,
access and estoppel certificate, executed by the applicable landlord and
landlord’s mortgagee; provided that, with respect to the property located at
1919 Pennsylvania Avenue, N.W., Washington, D.C. 20006, Borrower shall use
commercially reasonably efforts to deliver within 45 days of the date hereof an
executed landlord subordination agreement in form and substance reasonably
satisfactory to the Administrative Agent and Required Noteholders.

4.14. Use of Collateral. No Grantor shall use any of the Collateral, or permit
the same to be used, for any unlawful purpose.

4.15. Insurance. Each Grantor will bear the full risk of loss from any loss of
any nature whatsoever with respect to the Collateral. At its own cost and
expense, each Grantor shall (i) keep all its insurable properties and properties
in which such Grantor has an interest (other than properties owned by Portfolio
Companies) insured against the hazards of fire, flood, sprinkler leakage, those
hazards covered by extended coverage insurance, and such other hazards, and for
such amounts, as is customary in the case of companies engaged in businesses
similar to such Grantor’s, including, public and product liability insurance,
worker’s compensation, insurance against larceny, embezzlement or other criminal
misappropriation of such Grantor’s officers and employees, and business
interruption insurance; (ii) furnish Collateral Agent with (x) copies of all
policies and evidence of the maintenance of such policies at least thirty
(30) days before any expiration date, and (y) appropriate loss payable
endorsements, naming Collateral Agent as loss payee and providing that, as to
Collateral Agent, the insurance coverage shall not be impaired or invalidated by
any act or neglect of such Grantor and the insurer will provide Collateral Agent
with at least thirty (30) days notice prior to cancellation. Following the
occurrence and during the continuance of an Applicable Triggering Event,
Collateral Agent may require each Grantor to instruct the insurance carriers
that in the event of any loss thereunder, the carriers shall make payment for
such loss to Collateral Agent and not to Grantor and Collateral Agent jointly.
All loss recoveries received by Collateral Agent upon any such insurance,
following the occurrence and during the continuance of an Applicable Triggering
Event, shall be applied to the Secured Obligations by Collateral Agent in
accordance with the terms of the Intercreditor Agreement, and any deficiency
thereon shall be paid by Grantors to Collateral Agent, on demand.

4.16. Further Assurances. At Grantors’ expense, each Grantor agrees, subject to
the provisions of Section 4.19, (i) to file or cause to be filed such
applications and take such other actions as Collateral Agent (as directed in
accordance with the Intercreditor Agreement) may reasonably request to obtain
the consent or approval of any Governmental Authority to Collateral Agent’s
rights hereunder in or with respect to the Collateral or the Collateral
Documents (other than Second Tier Collateral that is not subject to a Perfection
Requirement), including, without limitation, the right to sell all the
Collateral after the occurrence of an Applicable Triggering Event, without
additional consent or approval from such Governmental Authority (and, because
each Grantor agrees that Collateral Agent’s remedies at law for failure of
Grantors to comply with this provision would be inadequate and that such failure
would not be adequately compensable in damages, each Grantor agrees that its
covenants in this provision may be specifically enforced); (ii) from time to
time promptly execute and deliver to Collateral Agent all such other
assignments, certificates, supplemental documents, and financing statements, and
do all other acts or things as Collateral Agent may reasonably request in order
to more fully create, evidence, perfect, continue, and preserve the priority of
the Security Interest on the Collateral (other than Second Tier Collateral that
is not subject to a Perfection Requirement) and to carry out the provisions of
this Security Agreement; and (iii) to pay all filing fees in connection with any
financing, continuation, or termination statement or other instrument with
respect to the Security Interests.

4.17. Additional Grantors. Within ten (10) days after the time that any Person
(other than a Pledge LLC) becomes a Consolidated Subsidiary, (i) Grantors shall
cause such Consolidated Subsidiary to become a party to this Security Agreement
and to pledge a valid and perfected Lien and Security Interest in all of its
real and personal property, whether tangible or intangible, pursuant to a
joinder agreement attached hereto as Exhibit 4.17, (other than real and personal
property which constitute Excluded Assets (subject to the right of the Secured
Parties to assert Liens or security interests in any such assets or proceeds
thereof to the extent permitted pursuant to Sections 9-406, 9-407, 9-408, or
9-409 of the UCC (or any successor provision or provisions) of the jurisdiction
the UCC of which would govern such determination (unless the application of
Sections 9-406, 9-407, 9-408, or 9-409 of the UCC would automatically result in
(x) additional affirmative obligations on the part of any Grantor or (y) the
granting of rights and remedies not previously held to, or exercise of rights or
remedies not previously entitled to be exercised by, third parties, in which
event such assets shall remain “Excluded Assets”) or any other Applicable Law
(including the Bankruptcy Code) or principles of equity), and with respect to
perfection, other than Second Tier Collateral that is not subject to a
Perfection Requirement, (ii) 100% of such Consolidated Subsidiary’s Equity
Interests (65% in the case of any Controlled Foreign Corporation, provided that,
immediately upon the amendment of the Internal Revenue Code to allow the pledge
of a greater percentage of the voting power of capital stock in a Controlled
Foreign Corporation without adverse Tax consequences, the Collateral shall
include, and the Security Interest shall attach to, such greater percentage of
capital stock of each Controlled Foreign Corporation) shall be pledged hereunder
and under the Collateral Documents, and (iii) Collateral Agent shall receive
such board resolutions, officer’s certificates, corporate and other documents,
and opinions of counsel (which may be issued by in-house counsel of Borrower) as
Collateral Agent shall reasonably request from such Grantor in connection with
the actions described in clauses (i) and (ii) preceding.

4.18. Future Assets of Grantors. Each Grantor shall use commercially reasonable
efforts to ensure that the documents which govern its future Investments do not
restrict the ability of such Grantor to subject any such Investment to the Lien
and Security Interest of this Security Agreement and the other Collateral
Documents; provided, however, that the foregoing shall not be deemed to preclude
Grantor from making an Investment as to which the governing documents contain
such a restriction. Without limiting the obligations of Grantor set forth above
or in Section 14.19, to the extent that any asset of a Grantor cannot be pledged
as Collateral on account of contractual limitations applicable to such property,
then such asset shall be an Excluded Asset and promptly conveyed to a Pledge LLC
(in accordance with Section 4.19.2), if such conveyance is permitted by the
governing documents.

4.19. Consents; Pledge LLC; Second Tier Collateral; Etc.

4.19.1. Consents. Each Grantor shall use, subject to the provisions contained in
this Section 4.19, commercially reasonable efforts to obtain the consent or
approval of, or other action by, all third parties required to permit Grantors
to subject all of their respective assets (including the Excluded Assets) to the
Lien and Security Interest of this Security Agreement and the other Collateral
Documents; provided, however, that Grantor shall not be obligated to obtain
consents or approvals in respect of assets (a) where the value of such assets
would not reasonably justify the burden, costs and expenses necessary to obtain
such consent or approval; in making such determination, Grantor may take into
account the cost or charges imposed by such third parties (on any Grantor or any
entity in which any Grantor has an Investment) to grant any such consent or
approval or take such other action and/or any undue burden, or (b) which in the
reasonable judgment of Grantor cannot be pledged, or as to which the consent to
pledge cannot be sought, without substantially impairing the value of the asset
or the ability of Grantor to manage the asset in the ordinary course of its
business; provided further that, nothing shall be deemed a waiver of any rights
Secured Parties may have to assert Liens or security interests in any such
assets or proceeds thereof to the extent permitted pursuant to Sections 9-406,
9-407, 9-408, or 9-409 of the UCC (or any successor provision or provisions) of
the jurisdiction the UCC of which would govern such determination (unless the
application of Sections 9-406, 9-407, 9-408, or 9-409 of the UCC would
automatically result in (x) additional affirmative obligations on the part of
any Grantor or (y) the granting of rights and remedies not previously held to,
or exercise of rights or remedies not previously entitled to be exercised by,
third parties, in which event such assets shall remain “Excluded Assets”) or any
other Applicable Law (including the Bankruptcy Code) or principles of equity.

4.19.2. Pledge LLC. Without limiting the obligations of each Grantor set forth
in this Section 4.19, to the extent that any personal property of a Grantor
cannot be pledged as Collateral on account of contractual limitations applicable
to such property but may be transferred to a Pledge LLC, such personal property
shall be promptly transferred to a Pledge LLC, and all membership interests in
such Pledge LLC shall be pledged to Collateral Agent, creating a perfected, and
to each Grantor’s Knowledge, first priority, Lien and Security Interest therein,
subject to Permitted Liens; provided that, any personal property listed on
Schedule 3.17.2 as of the date hereof shall not be required to be transferred to
a Pledge LLC pursuant to the requirements of this Section 4.19.2, unless such
personal property is still owned by a Grantor as of October 31, 2009 (and not
subject to a contract of sale therefor as of such date), in which case, any such
property shall be transferred to a Pledge LLC within two (2) Business Days
following such date.

4.19.3. Second Tier Collateral; Real Property. After the occurrence and during
the continuance of an Event of Default, each Grantor shall take such actions as
requested by Collateral Agent (acting at the direction of the Required Secured
Creditors) to, within ten (10) Business Days after such request, (a) perfect the
Lien and Security Interest granted hereunder with respect to any Second Tier
Collateral and (b) grant a mortgage on any Real Property that is not otherwise
subject to the requirements of Section 4.20. For the avoidance of doubt, so long
as no Event of Default has occurred and is continuing, each Grantor shall have
no obligation to take any actions to perfect the Lien and Security Interest
granted hereunder with respect to any Second Tier Collateral or grant any
mortgages with respect to Real Property (except to the extent required in
Section 4.20).

4.19.4. Excess Collateral. Each Grantor covenants and agrees that if it becomes
aware of any Excess Collateral, it will (a) promptly (and in any event within
three (3) Business Days) notify Collateral Agent of such Excess Collateral, and
(b) take all actions reasonably necessary to perfect the Lien and Security
Interest granted hereunder with respect to any Excess Collateral within 20 days
(or such later date as may be agreed by Collateral Agent).

4.19.5. Excluded Assets. To the extent a Grantor obtains any consents or
approvals or other actions by third parties in respect of any Excluded Assets in
accordance with Section 4.19.1 hereof, (x) Grantor shall, within two
(2) Business Days, (i) provide copies of any such consents or approvals to
Collateral Agent, and (ii) take such actions as are reasonably necessary to
perfect the Lien and Security Interest granted hereunder with respect to such
assets, including, if such assets are held by a Custodian, transferring (or
causing such Custodian to transfer) such assets to a Custodial Account subject
to a Custody Control Agreement, and (y) such assets shall no longer constitute
“Excluded Assets”.

4.20. Real Property; Fixtures. Each Grantor covenants and agrees that within two
(2) Business Days following its acquisition after the date hereof of any fee
interest in Real Property with an appraised value greater than or equal to
$5,000,000, it will promptly notify Collateral Agent of the acquisition of such
Real Property. To the extent that such Grantor holds such Real Property for
forty-five (45) days following the acquisition date thereof, Grantor covenants
and agrees that, within seventy-five (75) days following the acquisition date of
such Real Property, Grantor will grant to Collateral Agent, for the benefit of
the Secured Parties, a mortgage on each fee interest in such Real Property and
shall deliver such other documentation and opinions, in form and substance
reasonably satisfactory to Collateral Agent (to be determined in accordance with
the terms of the Intercreditor Agreement), in connection with the grant of such
mortgage as Collateral Agent or the Secured Parties may reasonably request,
including title insurance policies, financing statements, fixture filings and
environmental audits and such Grantor shall pay all recording costs, intangible
taxes and other normal and customary fees and costs (including reasonable
attorneys’ fees and expenses) incurred in connection therewith. Each Grantor
acknowledges and agrees that, to the extent permitted by Applicable Law, all of
its Collateral shall remain personal property regardless of the manner of its
attachment or affixation to Real Property.

ARTICLE V
RIGHTS AND REMEDIES

5.1. Remedies. On and after the occurrence and during the continuance of a
Triggering Event, Collateral Agent may exercise any and all of the following
rights and remedies as directed in the applicable Enforcement Direction of the
requisite Secured Parties (as are specified in the Intercreditor Agreement)
received by Collateral Agent:

5.1.1. Contractual Remedies. Those rights and remedies provided in this Security
Agreement or any other Financing Document.

5.1.2. Legal Remedies. Those rights and remedies available to a secured party
under the UCC (whether or not the UCC applies to the affected Collateral) or
under any other Applicable Law (including any law governing the exercise of a
bank’s right of setoff or bankers’ lien) when a debtor is in default under a
security agreement, including applying by appropriate judicial proceedings for
the appointment of a receiver for all or any part of the Collateral (and
Grantors hereby consent to such appointment).

5.1.3. Disposition of Collateral. Without notice, except as specifically
provided in Section 5.2.3 or elsewhere herein or in any other Financing Document
or under Applicable Law, sell, lease, assign, grant an option, or options to
purchase or otherwise dispose of the Collateral or any part thereof in one or
more parcels at public or private sale or at any broker’s board or on any
securities exchange, for cash, on credit or for future delivery, and upon such
other terms as Collateral Agent may deem commercially reasonable. Neither
Collateral Agent’s compliance with any applicable state or federal law in the
conduct of such sale, nor its disclaimer of any warranties relating to the
Collateral, shall be considered to affect the commercial reasonableness of such
sale. Each Grantor hereby waives (to the extent permitted by Applicable Law) all
rights of redemption, stay, and/or appraisal which it now has or may at any time
in the future have under any rule of law or statute now existing or hereafter
enacted.

5.1.4. Distributions. Cause all payments and distributions made to any Grantor
upon or with respect to the Collateral to be paid or delivered to Collateral
Agent, and each Grantor agrees to take all such action appropriate to cause all
such payments and distributions to be made to Collateral Agent. Further,
Collateral Agent shall have the right, at any time after the occurrence and
during the continuance of an Applicable Triggering Event, to notify and direct
any issuer to thereafter make all payments, dividends, and any other
distributions payable in respect thereof directly to Collateral Agent. Any and
all money and other property paid over to or received by Collateral Agent
hereunder shall be retained by Collateral Agent as additional Collateral
hereunder and may be applied in accordance with Section 5.10.

5.1.5. Control. Collateral Agent shall have the right, pursuant to the
applicable Control Agreement or Custody Control Agreement, to notify and direct
each Custodian and each institution in which any Grantor maintains a Deposit
Account, Commodities Account, or Securities Account to, unless otherwise
notified by Collateral Agent, thereafter take all instructions with respect
thereto solely from Collateral Agent, to hold the Custodial Account and the
Custodial Collateral, and each Deposit Account, Commodities Account, and
Securities Account (together with all monies, Instruments, certificates, checks,
drafts, wire transfer receipts, trust receipts, securities, Investments, or
other assets therein) solely for the benefit of Collateral Agent, and thereafter
to make any payments and any other distributions payable in respect thereto
directly to Collateral Agent, and to provide all statements or reports to
Collateral Agent relative to such Custodial Accounts, Deposit Accounts,
Commodities Accounts, and Securities Accounts. Each such Custodian and
institution shall be fully protected in relying on the written statement of
Collateral Agent that it then holds a Security Interest which entitles it to
exercise Control over such assets. Any and all money and other property paid
over to or received by Collateral Agent hereunder shall be retained by
Collateral Agent as additional Collateral hereunder and may be applied in
accordance with Section 5.10.

5.1.6. Use of Premises. Subject to the terms of any applicable lease, Collateral
Agent shall be entitled to occupy and use any premises owned or leased by any
Grantor where any of the Collateral or any records relating to the Collateral
are located until the Secured Obligations are paid in full or the Collateral is
removed therefrom, whichever first occurs, without any obligation to pay such
Grantor for such use and occupancy.

5.2. Grantors’ Obligations Upon a Triggering Event.

5.2.1. Assembly of Collateral. Upon the request of Collateral Agent, on and
after the occurrence and during the continuance of a Triggering Event, each
Grantor will assemble and make available to Collateral Agent the Collateral and
all records relating thereto at Borrower’s offices in Washington, D.C.

5.2.2. Secured Party Access. Upon the request of Collateral Agent, on and after
the occurrence and during the continuance of a Triggering Event, and subject to
the terms of any applicable lease, each Grantor will permit Collateral Agent, by
Collateral Agent’s representatives and agents, to enter any premises where all
or any part of the Collateral, or the books and records relating thereto, or
both, are located, to take possession of all or any part of the Collateral and
to remove all or any part of the Collateral.

5.2.3. Notice of Disposition of Collateral. Any notice of the time and place of
any public sale or the time after which any private sale or other disposition of
all or any part of the Collateral may be made shall be deemed reasonable if made
in accordance with Applicable Law. Collateral Agent shall not be obligated to
make any sale or other disposition of the Collateral regardless of notice having
been given. Subject to the provisions of Applicable Law, Collateral 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 Applicable Law, be made
at the time and place to which the sale was postponed, or Collateral Agent may
further postpone such sale by announcement made at such time and place.

5.3. Condition of Collateral; Warranties. Collateral Agent has no obligation to
clean-up or otherwise prepare the Collateral for sale. Collateral Agent may sell
the Collateral without giving any warranties as to the Collateral. Collateral
Agent may specifically disclaim any warranties of title or the like. This
procedure will not be considered to adversely affect the commercial
reasonableness of any sale of the Collateral.

5.4. Collection of Receivables. Upon the occurrence and during the continuance
of an Applicable Triggering Event, Collateral Agent may at any time, by giving
Grantors written notice, elect to require that the Receivables be paid directly
to Collateral Agent. In such event, each Grantor shall, and shall permit
Collateral Agent to, promptly notify the Obligors with respect to the
Receivables of Collateral Agent’s interest therein and direct such Obligors to
make payment of all amounts then or thereafter due under the Receivables
directly to Collateral Agent. Upon receipt of any such notice from Collateral
Agent, each Grantor shall thereafter hold in trust for Collateral Agent, all
amounts and proceeds received by it with respect to the Receivables and
immediately and at all times thereafter deliver to Collateral Agent all such
amounts and proceeds in the same form as so received, whether by cash, check,
draft or otherwise, with any necessary endorsements. Collateral Agent shall hold
and apply funds so received as provided by the terms of Section 5.10.

5.5. Special Collateral Account. Upon the occurrence and during the continuance
of an Applicable Triggering Event, Collateral Agent shall have, and each Grantor
hereby grants to Collateral Agent, the right and authority to transfer all funds
on deposit in the Deposit Accounts, Securities Accounts, Custodial Accounts and
Commodities Accounts to the Special Collateral Account, and no disbursements or
withdrawals shall be permitted to be made by any Grantor from such Special
Collateral Account except as expressly permitted pursuant to the terms and
conditions of the Intercreditor Agreement. Such Special Collateral Account shall
be subject to the Security Interest herein created, and each Grantor hereby
grants a security interest to Collateral Agent (for the benefit of Secured
Parties) in and to, such Special Collateral Account and all monies, checks,
drafts, and other items ever received by Grantor for deposit therein.
Furthermore, Collateral Agent shall have the right, at any time in its
discretion during the continuance of an Applicable Triggering Event (or with
respect to clause (ii) below, upon the occurrence and during the continuance of
a Special Event of Default), without notice to any Grantor, (i) to transfer to
or to register in the name of Collateral Agent or nominee thereof, in accordance
with Applicable Law, any certificates of deposit or deposit instruments,
Instruments, Investments, or Investment Related Property constituting Deposit
Accounts, Securities Accounts, or Commodities Accounts and shall have the right
to exchange such certificates or instruments representing Deposit Accounts for
certificates or instruments of smaller or larger denominations, in accordance
with Applicable Law, and (ii) to take and apply against the Secured Obligations
any and all funds then or thereafter on deposit in the Special Collateral
Account or otherwise constituting Deposit Accounts in accordance with the terms
and conditions of the Intercreditor Agreement.

5.6. Intellectual Property. For purposes of enabling Collateral Agent to
exercise its rights and remedies under this Security Agreement and enabling
Collateral Agent to enjoy the full benefits of the Collateral, effective upon
the occurrence and during the continuance of an Applicable Triggering Event each
Grantor hereby grants to Collateral Agent an irrevocable, nonexclusive license
(exercisable without payment of royalty or other compensation to such Grantor)
to make, have made, use, sell, invent, reproduce, distribute, display and
perform publicly, create derivative works, perform by means of digital
transmission, license, or sublicense any of the Intellectual Property. During
the continuation of an Applicable Triggering Event, each Grantor shall provide
Collateral Agent with reasonable access to all media in which any of the
Intellectual Property may be recorded or stored and all computer programs used
for the completion or printout thereof. This license shall also inure to the
benefit of all successors, assigns, and transferees of Collateral Agent. After
the occurrence and during the continuance of an Applicable Triggering Event,
Collateral Agent may require that each Grantor assign all of its right, title,
and interest in and to the Intellectual Property or any part thereof to
Collateral Agent or such other Person as Collateral Agent may designate pursuant
to documents reasonably satisfactory to the Collateral Agent.

5.7. Record Ownership of Securities. After the occurrence and during the
continuance of an Applicable Triggering Event, Collateral Agent may, in
accordance with Applicable Law, have any Pledged Equity Interests or other
Investment Related Property that is in the possession of Collateral Agent, or
its nominee or nominees, registered in its name, or in the name of its nominee
or nominees, as Collateral Agent; and, as to any Pledged Equity Interest or
other Investment Related Property so registered, Collateral Agent shall (if
applicable) execute and deliver (or cause to be executed and delivered) to the
applicable Grantor all such proxies, powers of attorney, dividend coupons or
orders, and other documents as such Grantor may reasonably request for the
purpose of enabling such Grantor to exercise any voting rights and powers which
it is entitled to exercise under this Security Agreement or to receive any
dividends and other distributions and payments in respect of such Collateral or
proceeds thereof which it is authorized to receive and retain under this
Security Agreement.

5.8. Investment Related Property. Each Grantor recognizes that, by reason of
certain prohibitions contained in the Securities Act and applicable state
securities laws, Collateral Agent may be compelled, with respect to any sale of
all or any part of the Investment Related Property conducted without prior
registration or qualification of such Investment Related Property under the
Securities Act and/or such state securities laws, to limit purchasers to those
who will agree, among other things, to acquire the Investment Related Property
for their own account, for investment and not with a view to the distribution or
resale thereof. Each Grantor acknowledges that any such private sale may be at
prices and on terms less favorable than those obtainable through a public sale
without such restrictions (including a public offering made pursuant to a
registration statement under the Securities Act) and, notwithstanding such
circumstances, each Grantor agrees that Collateral Agent shall have no
obligation to engage in public sales and no obligation to delay the sale of any
Investment Related Property for the period of time necessary to permit the
issuer thereof to register it for a form of public sale requiring registration
under the Securities Act or under applicable state securities laws, even if such
issuer would, or should, agree to so register it. Upon the occurrence and during
the continuance of an Applicable Triggering Event, Collateral Agent may exercise
its right to sell any or all of the Investment Related Property, and upon
written request, each Grantor shall and shall use its commercially reasonable
efforts to cause, each issuer of any Investment Related Property to be sold
hereunder, from time to time to furnish to Collateral Agent all such information
as Collateral Agent may reasonably request in order to determine the number and
nature of interest, shares, or other instruments included in the Investment
Related Property which may be sold by Collateral Agent in exempt transactions
under the Securities Act and the rules and regulations of the Securities and
Exchange Commission thereunder. In case of any sale of all or any part of the
Investment Related Property on credit or for future delivery, such Collateral so
sold may be retained by Collateral Agent until the selling price is paid by the
purchaser thereof, but Collateral Agent shall not incur any liability in case of
the failure of such purchaser to take up and pay for such assets so sold and in
case of any such failure, such Collateral may again be sold upon like notice.
Collateral Agent, instead of exercising the power of sale herein conferred upon
them, may proceed by a suit or suits at law or in equity to foreclose security
interests created hereunder and sell such Investment Related Property, or any
portion thereof, under a judgment or decree of a court or courts of competent
jurisdiction.

5.9. Sales on Credit. If Collateral Agent sells any of the Collateral upon
credit, Grantors will be credited only with payments actually made by the
purchaser, received by the Collateral Agent, and applied to the indebtedness of
the purchaser. In the event the purchaser fails to pay for the Collateral,
Collateral Agent may resell the Collateral and Grantors shall be credited with
the proceeds of the sale.

5.10. Application of Proceeds. Collateral Agent shall apply the proceeds of any
sale or other disposition of the Collateral in accordance with the terms and
conditions of the Intercreditor Agreement. Any surplus remaining shall be
delivered to Grantors or as a court of competent jurisdiction may direct. If the
proceeds of any sale or disposition are insufficient to pay the Secured
Obligations in full, Grantors shall remain liable for any deficiency and the
reasonable fees of any attorneys employed by Collateral Agent or Secured Parties
to collect.

5.11. Performance. If any Grantor fails to pay when due all Taxes on any of the
Collateral in the manner required by this Security Agreement, the other
Collateral Documents and any applicable Financing Document, or fails to preserve
the Security Interest in any of the Collateral, or fails to keep the Collateral
insured as required by this Security Agreement, or otherwise fails to perform
any of its obligations under this Security Agreement, the other Collateral
Documents, or any applicable Financing Document with respect to the Collateral,
then Collateral Agent may, at its option, but without being required to do so,
pay such Taxes, prosecute or defend any suits in relation to the Collateral, or
insure and keep insured the Collateral in any amount deemed appropriate by
Collateral Agent, or take all other action which any Grantor is required, but
has failed or refused, to take under this Security Agreement and the other
Collateral Documents. Each Grantor shall, jointly and severally, reimburse
Collateral Agent for any amounts paid by Collateral Agent pursuant to this
Section 5.11. Each Grantor’s obligation to reimburse Collateral Agent pursuant
to the preceding sentence shall be a Secured Obligation payable on demand.

5.12. Use and Operation of Collateral. Should any Collateral come into the
possession of Collateral Agent, Collateral Agent may use or operate such
Collateral for the purpose of preserving it or its value pursuant to the order
of a court of appropriate jurisdiction or in accordance with any other rights
held by Collateral Agent in respect of such Collateral. Each Grantor covenants
to promptly reimburse and pay to Collateral Agent, at Collateral Agent’s
request, the amount of all reasonable expenses (including, without limitation,
the cost of any insurance and payment of Taxes or other charges) incurred by
Collateral Agent in connection with its custody and preservation of Collateral,
and all such expenses, costs, Taxes, and other charges shall be payable by
Grantors to Collateral Agent upon demand and shall become part of the Secured
Obligations. However, the risk of accidental loss or damage to, or diminution in
value of, Collateral is on Grantors (unless Grantors no longer hold title to
such Collateral), and Collateral Agent shall have no liability whatsoever for
failure to obtain or maintain insurance, nor to determine whether any insurance
ever in force is adequate as to amount or as to the risks insured. With respect
to Collateral that is in the possession of Collateral Agent, Collateral Agent
shall have no duty to fix or preserve rights against prior parties to such
Collateral and shall not be liable for any failure to use diligence to collect
any amount payable in respect of such Collateral, but shall be liable only to
account to Grantors for what it may actually collect or receive thereon. The
provisions of this Section 5.12 are applicable whether or not a Triggering Event
exists.

5.13. Power of Attorney. Each Grantor hereby irrevocably constitutes and
appoints Collateral Agent and any officer or agent thereof, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable
power and authority in the name of such Grantor or in its own name, to take,
upon the occurrence and during the continuation of a Triggering Event, any and
all action and to execute any and all documents and instruments which Collateral
Agent at any time and from time to time deems reasonably necessary to accomplish
the purposes of this Security Agreement and, without limiting the generality of
the foregoing, each Grantor hereby gives Collateral Agent the power and right on
behalf of such Grantor and in its own name to do any of the following after the
occurrence and during the continuation of a Triggering Event, without notice to
or the consent of Grantor:

5.13.1. to transfer any and all funds on deposit in the Deposit Accounts to the
Special Collateral Account as set forth herein;

5.13.2. to receive, endorse, and collect any drafts or other instruments or
documents in connection with the exercise of any rights or remedies pursuant to
this Security Agreement;

5.13.3. to use the Intellectual Property or to grant or issue any exclusive or
non-exclusive license under the Intellectual Property to anyone else, and to
perform any act necessary for the Collateral Agent to assign, pledge, convey, or
otherwise transfer title in or dispose of the Intellectual Property to any other
Person;

5.13.4. to demand, sue for, collect, or receive, in the name of the applicable
Grantor or in its own name, any money or property at any time payable or
receivable on account of or in exchange for any of the Collateral and, in
connection therewith, endorse checks, notes, drafts, acceptances, money orders,
documents of title or any other instruments for the payment of money under the
Collateral or any policy of insurance;

5.13.5. to pay or discharge Taxes, Liens, or other encumbrances levied or placed
on or threatened against the Collateral;

5.13.6. to notify post office authorities to change the address for delivery of
each Grantor to an address designated by Collateral Agent and to receive, open,
and dispose of mail addressed to any Grantor; and

5.13.7. (a) to direct account debtors and any other parties liable for any
payment under any of the Collateral to make payment of any and all monies due
and to become due thereunder directly to Collateral Agent or as Collateral Agent
shall direct; (b) 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; (c) to sign and endorse any invoices, freight or
express bills, bills of lading, storage or warehouse receipts, drafts against
debtors, assignments, proxies, stock powers, verifications, and notices in
connection with accounts and other documents relating to the Collateral; (d) to
commence and prosecute any suit, action, or proceeding at Law or in equity in
any court of competent jurisdiction to collect the Collateral or any part
thereof and to enforce any other right in respect of any Collateral; (e) to
defend any suit, action, or proceeding brought against any Grantor with respect
to any Collateral; (f) to settle, compromise, or adjust any suit, action, or
proceeding described above and, in connection therewith, to give such discharges
or releases; (g) to exchange any of the Collateral for other property upon any
merger, consolidation, reorganization, recapitalization, or other readjustment
of the issuer thereof and, in connection therewith, deposit any of the
Collateral with any committee, depositary, transfer agent, registrar, or other
designated agency upon such terms as Collateral Agent may determine; (h) to add
or release any guarantor, indorser, surety, or other party to any of the
Collateral; (i) to renew, extend, or otherwise change the terms and conditions
of any of the Collateral; (j) to endorse the applicable Grantor’s name on all
applications, documents, papers, and instruments necessary or desirable in order
for Collateral Agent to use or maintain any of the Intellectual Property; (k) to
make, settle, compromise or adjust any claims under or pertaining to any of the
Collateral (including claims under any policy of insurance); (l) to execute (if
necessary) on behalf of each Grantor any financing statements or continuation
statements with respect to the Security Interests created hereby, and to do any
and all acts and things to protect and preserve the Collateral, including,
without limitation, the protection and prosecution of all rights included in the
Collateral; and (m) to sell, transfer, pledge, convey, make any agreement with
respect to or otherwise deal with any of the Collateral as fully and completely
as though Collateral Agent were the absolute owner thereof for all purposes, and
to do, at Collateral Agent’s option and Grantors’ expense, at any time, or from
time to time, all acts and things which Collateral Agent deems necessary to
protect, preserve, maintain, or realize upon the Collateral and Collateral
Agent’s security interest therein.

This power of attorney is a power coupled with an interest and shall be
irrevocable until this Security Agreement is terminated in accordance with
Section 6.1. Collateral Agent shall be under no duty to exercise or withhold the
exercise of any of the rights, powers, privileges, and options expressly or
implicitly granted to Collateral Agent in this Security Agreement, and shall
never be liable for any failure to do so or any delay in doing so. None of
Collateral Agent nor any Person designated by Collateral Agent shall be liable
for any act or omission or for any error of judgment or any mistake of fact or
law except for their willful misconduct, gross negligence, or violation of law
as determined by a court of competent jurisdiction in a final and nonappealable
judgment. This power of attorney is conferred on Collateral Agent solely to
protect, preserve, maintain, and realize upon its Security Interest in the
Collateral. Collateral Agent shall not be responsible for any decline in the
value of the Collateral and shall not be required to take any steps to preserve
rights against prior parties or to protect, preserve, or maintain any Lien given
to secure the Collateral. Each Grantor ratifies and approves all acts of such
attorney in the absence of its willful misconduct, gross negligence, or knowing
or willful violation of law.

5.14. Subrogation. If any of the Secured Obligations are given in renewal or
extension or applied toward the payment of indebtedness secured by any Lien,
Collateral Agent and Secured Parties shall be, and each is hereby, subrogated to
all of the rights, titles, interests, and Liens securing the indebtedness so
renewed, extended, or paid.

5.15. Indemnification. Each Grantor hereby assumes all liability for the
Collateral, for the Security Interest, and for any use, possession, maintenance,
and management of, all or any of the Collateral, including, without limitation,
any Taxes arising as a result of, or in connection with, the transactions
contemplated herein, and agrees to assume liability for, and to jointly and
severally indemnify and hold Collateral Agent and each Secured Party harmless
from and against, any and all claims, causes of action, or liability, for
injuries to or deaths of Persons and damage to property, howsoever arising from
or incident to such use, possession, maintenance, and management, whether such
Persons be agents or employees of Grantor or of third parties, or such damage be
to property of Grantor or of others, and any actual or alleged presence or
release of hazardous materials on or from any property owned or operated by any
Grantor or any of its Subsidiaries or any environmental liability related in any
way to any Grantor or any of its Subsidiaries. Each Grantor agrees to jointly
and severally indemnify, save, and hold Collateral Agent and each Secured Party
harmless from and against, and covenants to defend Collateral Agent and each
Secured Party against, any and all losses, damages, claims, costs, penalties,
liabilities, and expenses (collectively, “Claims”), including, without
limitation, court costs and reasonable attorneys’ fees, and any of the foregoing
arising from the negligence of Collateral Agent and each Secured Party, or any
of their respective officers, employees, agents, advisors, or representatives,
howsoever arising or incurred because of, incident to, or with respect to
Collateral or any use, possession, maintenance, or management thereof; provided,
however, that the indemnity set forth in this Section 5.15 will not apply to
Claims caused by the gross negligence or willful misconduct of Collateral Agent
or any Secured Party or any of its officers, employees, agents, advisors, or
representatives, as determined by a court of competent jurisdiction in a final
and nonappealable judgment.

ARTICLE VI
GENERAL PROVISIONS

6.1. Termination. This Security Agreement shall continue in effect
(notwithstanding the fact that from time to time there may be no Secured
Obligations outstanding) until all of the Secured Obligations have been paid in
full in cash and performed in full, no commitments of any Secured Party which
would give rise to any Secured Obligations are outstanding under the applicable
Financing Documents and any outstanding LC’s have been cash collateralized in an
amount equal to 100.0% of the undrawn amount of such LC’s upon terms
satisfactory to the Administrative Agent; provided that the termination of this
Security Agreement under this Section 6.1 is subject to Section 6.5.

6.2. Joint and Several Obligations of Grantors.

6.2.1. Each Grantor is accepting joint and several liability hereunder with
other Persons that have executed or will execute a Security Agreement in
consideration of the financial accommodation to be provided by the holders of
the Secured Obligations, for the mutual benefit, directly and indirectly, of
each Grantor and in consideration of the undertakings of each Grantor to accept
joint and several liability for the obligations of each of them.

6.2.2. Each Grantor jointly and severally hereby irrevocably and unconditionally
accepts, not merely as a surety but also as a co-debtor, joint and several
liability with the other Grantors with respect to the payment and performance of
all of the Secured Obligations, it being the intention of the parties hereto
that all the Secured Obligations shall be the joint and several obligations of
each Grantor without preferences or distinction among them.

6.3. NO RELEASE OF GRANTORS. THE OBLIGATIONS OF GRANTORS UNDER THIS SECURITY
AGREEMENT SHALL NOT BE REDUCED, LIMITED OR TERMINATED, NOR SHALL GRANTORS BE
DISCHARGED FROM ANY OBLIGATION HEREUNDER, FOR ANY REASON WHATSOEVER (other than
pursuant to Section 6.1) including (and whether or not the same shall have
occurred or failed to occur once or more than once and whether or not Grantors
shall have received notice thereof): (i) the taking or accepting of any other
security or assurance for any or all of the Secured Obligations; (ii) any
release, surrender, exchange, subordination, or loss of any security or
assurance at any time existing in connection with any or all of the Secured
Obligations; (iii) the modification of, amendment to, or waiver of compliance
with any terms of any of the Financing Documents or any other Collateral
Documents without the notification or consent of any Grantor, except as required
therein (the right to such non-excepted notification or consent being herein
specifically waived by each Grantor); (iv) the insolvency, bankruptcy, or lack
of corporate or trust power of any party at any time liable for the payment of
any or all of the Secured Obligations, whether now existing or hereafter
occurring; (v) any renewal, extension, or rearrangement of the payment of any or
all of the Secured Obligations, either with or without notice to or consent of
any Grantor, or any adjustment, indulgence, forbearance, or compromise that may
be granted or given by Collateral Agent or any Secured Party to any Grantor;
(vi) any neglect, delay, omission, failure, or refusal of Collateral Agent or
any Secured Party to take or prosecute any action in connection with any other
agreement, document, guaranty, or instrument evidencing, securing, or assuring
the payment of all or any of the Secured Obligations; (vii) any failure of
Collateral Agent or any Secured Party to notify any Grantor of any renewal,
extension, or assignment of the Secured Obligations or any part thereof, or the
release of any Collateral or other security, or of any other action taken or
refrained from being taken by Collateral Agent or any Secured Party against any
Grantor or any new agreement between or among Collateral Agent or one or more
Secured Parties and any Grantor, it being understood that except as expressly
provided herein or in any other Financing Document or pursuant to Applicable
Law, neither Collateral Agent nor any Secured Party shall be required to give
Grantors any notice of any kind under any circumstances whatsoever with respect
to or in connection with the Secured Obligations, including notice of acceptance
of this Security Agreement or any Collateral ever delivered to or for the
account of Collateral Agent hereunder; (viii) the illegality, invalidity, or
unenforceability of all or any part of the Secured Obligations against any party
obligated with respect thereto by reason of the fact that the Secured
Obligations, or the interest paid or payable with respect thereto, exceeds the
amount permitted by Applicable Law, the act of creating the Secured Obligations,
or any part thereof, is ultra vires, or the officers, partners, or trustees
creating same acted in excess of their authority, or for any other reason;
(ix) if any payment by any party obligated with respect thereto is held to
constitute a preference under Applicable Laws or for any other reason Collateral
Agent or any Secured Party is required to refund such payment or pay the amount
thereof to someone else; or (x) ANY OTHER ACT OR FAILURE TO ACT OR ANY OTHER
EVENT OR CIRCUMSTANCE THAT (a) VARIES THE RISK OF GRANTORS UNDER THIS SECURITY
AGREEMENT OR (b) BUT FOR THE PROVISIONS HEREOF, WOULD, AS A MATTER OF APPLICABLE
LAW OR EQUITY, OPERATE TO REDUCE, LIMIT OR TERMINATE THE OBLIGATIONS OF GRANTORS
HEREUNDER OR DISCHARGE GRANTORS FROM ANY OBLIGATION HEREUNDER.

6.4. Subordination of Certain Claims. Any and all rights and claims of Grantors
against Borrower or against any other Person or property, arising by reason of
any payment by any Grantors to any Secured Party pursuant to the provisions, or
in respect, of this Security Agreement shall be subordinate, junior and subject
in right of payment to the prior payment in full in cash of all Secured
Obligations, and until such time, Grantors defer all rights of subrogation,
contribution, or any similar right and until such time agree not to enforce any
such right or remedy Grantors may now or hereafter have against Borrower, any
endorser, or any other Grantor of all or any part of the Secured Obligations and
any right to participate in, or benefit from, any security given to Collateral
Agent to secure any of the Secured Obligations. All Liens and security interests
of Grantors, whether now or hereafter arising and howsoever existing, in assets
of Grantors or any assets securing the Secured Obligations shall be and hereby
are subordinated to the rights and interests of Collateral Agent and in those
assets until the prior final payment in full in cash of all Secured Obligations.
Notwithstanding the foregoing, the Grantors shall not be prevented from paying
amounts owing amongst themselves in the ordinary course of their business. If
any amount shall be paid to Grantors contrary to the provisions of this
Section 6.4 at any time when any of the Secured Obligations shall not have been
paid in full in cash, such amount shall be held in trust for the benefit of
Collateral Agent and shall forthwith be turned over to Collateral Agent in kind
in the form received (duly endorsed if necessary) to be credited and applied
against the Secured Obligations, whether matured or unmatured, in accordance
with the terms of the Financing Documents.

6.5. Recovered Payments. The Secured Obligations shall be deemed not to have
been paid, observed or performed, and Grantors’ obligations under this Security
Agreement in respect thereof shall continue and not be discharged, to the extent
that any payment, observance, or performance thereof by any Grantor is recovered
from or paid over by or for the account of Collateral Agent for any reason,
including as a preference or fraudulent transfer or by virtue of any
subordination (whether present or future or contractual or otherwise) of the
Secured Obligations, whether such recovery or payment over is effected by any
judgment, decree or order of any court or governmental agency, by any plan of
reorganization or by settlement or compromise by Collateral Agent or Secured
Parties (whether or not consented to by Grantors) of any claim for any such
recovery or payment over. Each Grantor hereby expressly waives the benefit of
any applicable statute of limitations and agrees that it shall be liable
hereunder whenever such a recovery or payment over occurs.

6.6. No Waiver. Amendments. To the fullest extent permitted by Applicable Law,
Grantor waives (i) any right to require Collateral Agent or any Secured Party to
proceed against any other Person, to exhaust its rights in Collateral, or to
pursue any other right which Collateral Agent or any Secured Party may have;
(ii) with respect to the Secured Obligations, presentment and demand for
payment, protest, notice of protest and nonpayment, and notice of the intention
to accelerate; and (iii) all rights of marshaling in respect of any and all of
the Collateral. No delay or omission of Collateral Agent to exercise any right
or remedy granted under this Security Agreement shall impair such right or
remedy or be construed to be a waiver of any Event of Default, or an
acquiescence therein, and any single or partial exercise of any such right or
remedy shall not preclude any other or further exercise thereof or the exercise
of any other right or remedy. This Security Agreement may not be amended,
waived, modified, or changed except as set forth in Section 6.4 of the
Intercreditor Agreement and then only to the extent in such writing specifically
set forth. All rights and remedies contained in this Security Agreement or
afforded by Applicable Law shall be cumulative and all shall be available to
Collateral Agent until the Secured Obligations have been paid in full.

6.7. Specific Performance of Certain Covenants. Each Grantor acknowledges and
agrees that a breach of any of the covenants contained in Sections 4.2.3, 4.5,
5.4, 5.5, 5.6, 5.10, or 5.11, will cause irreparable injury to Collateral Agent
and Secured Parties, that Collateral Agent and Secured Parties have no adequate
remedy at law in respect of such breaches and therefore agrees, without limiting
the right of Collateral Agent or Secured Parties to seek and obtain specific
performance of other obligations of such Grantor contained in this Security
Agreement, that the covenants of such Grantor contained in the Sections referred
to in this Section 6.7 shall be specifically enforceable against such Grantor.

6.8. Survival. All representations and warranties of each Grantor contained in
this Security Agreement shall survive the execution and delivery of this
Security Agreement. Without prejudice to the survival of any other obligation of
each Grantor hereunder, the obligations of each Grantor under Sections 6.9 and
5.15 shall survive termination of this Security Agreement.

6.9. Taxes and Expenses. Any Taxes (including income Taxes but excluding income
and franchise taxes of Collateral Agent and Secured Parties) payable or ruled
payable by federal or state authority in respect of this Security Agreement
shall be paid by each Grantor, together with interest and penalties, if any.
Grantors shall jointly and severally reimburse Collateral Agent for any and all
reasonable out-of-pocket expenses (including reasonable attorneys’, auditors’
and accountants’ fees) paid or incurred by Collateral Agent in connection with
the preparation, execution, delivery, and administration, of this Security
Agreement and, subject to any limitations set forth in Section 4.2.1, in the
audit, analysis, administration, collection, preservation or sale of the
Collateral (including the expenses and charges associated with any periodic or
special audit of the Collateral). In addition, Grantors shall be jointly and
severally obligated to pay all of the reasonable costs and expenses incurred by
Collateral Agent, including reasonable attorneys’ fees and court costs, in
obtaining or liquidating the Collateral, in enforcing payment of the Secured
Obligations, or in the prosecution or defense of any action or proceeding by or
against Secured Party or any Grantor concerning any matter arising out of or
connected with this Security Agreement, any Collateral or the Secured
Obligations, including any of the foregoing arising in, arising under or related
to a case under any bankruptcy, insolvency, or similar law. Any and all costs
and expenses incurred by each Grantor in the performance of actions required
pursuant to the terms hereof shall be borne solely by such Grantor.

6.10. Multiple Counterparts. This Security Agreement has been executed in a
number of identical counterparts, each of which shall be deemed an original for
all purposes and all of which constitute, collectively, one agreement; but, in
making proof of this Security Agreement, it shall not be necessary to produce or
account for more than one such counterpart. Any signature delivered by facsimile
or electronic mail shall be deemed to be an original signature hereto and shall
be admissible into evidence for all purposes.

6.11. Parties Bound; Assignment. This Security Agreement shall be binding on
each Grantor and each Grantor’s successors and assigns and shall inure to the
benefit of Collateral Agent and Secured Parties and their respective successors
and assigns.

6.11.1. Collateral Agent is the agent for each Secured Party, the Security
Interest and all rights granted to Collateral Agent hereunder or in connection
herewith are for the benefit of each Secured Party, and Collateral Agent may,
subject to the terms and conditions of the Intercreditor Agreement, without the
joinder of any Secured Party, exercise any and all rights in favor of Collateral
Agent or Secured Parties hereunder, including, without limitation, conducting
any foreclosure sales hereunder, and executing full or partial releases hereof,
amendments or modifications hereto, or consents or waivers hereunder. The rights
of each Secured Party vis-à-vis Collateral Agent and each other Secured Party
are subject to the Intercreditor Agreement and may (to the extent permitted
under the Intercreditor Agreement) be subject to one or more separate agreements
between or among such parties, but no Grantor need inquire about any such
agreement or be subject to any terms thereof unless such Grantor specifically
joins therein; and consequently, except as may be expressly provided therein, no
Grantor nor any Grantor’s successors or assigns shall be entitled to any
benefits or provisions of any such separate agreements or be entitled to rely
upon or raise as a defense, in any manner whatsoever, the failure or refusal of
any party thereto to comply with the provisions thereof except to the extent the
Borrower’s consent is expressly required under the Intercreditor Agreement to
consent to certain amendments thereunder.

6.11.2. No Grantor may, without the prior written consent of Collateral Agent
and Secured Parties, assign any of its rights, duties, or obligations hereunder.

6.12. Governing Law. This Security Agreement has been entered into pursuant to
Sections 5-1401 and 5-1402 of the New York General Obligations Law and the
applicable federal laws of the United States of America. The laws of the State
of New York and of the United States of America shall govern the rights and
duties of the parties to this Security Agreement and the validity, construction,
enforcement, and interpretation of this Security Agreement, except to the extent
that the laws of another jurisdiction govern the creation, perfection, validity,
or enforcement of Liens under this Security Agreement.

6.13. JURISDICTION; CONSENT TO SERVICE OF PROCESS; WAIVER OF JURY TRIAL.

6.13.1. Each Grantor and each other party hereto hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any New York State Court or Federal Court of the United States
of America sitting in New York City, and any appellate court from any thereof,
in any action or proceeding arising out of or relating to this Security
Agreement or the other Collateral Documents, or for recognition or enforcement
of any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State Court or, to the
extent permitted by law, in such Federal Court. Each of the parties hereto
agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Security Agreement shall
affect any right that Collateral Agent or any Secured Party may otherwise have
to bring any action or proceeding relating to this Security Agreement or the
other Collateral Documents against grantors or their respective properties in
the courts of any United States jurisdiction.

6.13.2. Each party hereto irrevocably and unconditionally waives, to the fullest
extent it may legally and effectively do so, any objection which it may now or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Security Agreement or the other Collateral Documents
in any New York State or Federal Court. Each of the parties hereto hereby
irrevocably waives, to the fullest extent permitted by law, the defense of an
inconvenient forum to the maintenance of such action or proceeding in any such
court.

6.13.3. Each Grantor and each other party hereto consents to service of process
in the manner provided for notices in Section 6.14.1. Nothing in this Security
Agreement will affect the right of any party to this Security Agreement to serve
process in any other manner permitted by applicable law.

6.13.4. Each party hereto hereby irrevocably waives, to the fullest extent
permitted by Applicable Law, any right it may have to a trial by jury in any
legal proceeding directly or indirectly arising out of or relating to this
Security Agreement or any other Collateral Document or the transactions
contemplated hereby or thereby (whether based on contract, tort or any other
theory). Each party hereto (a) certifies that no representative, agent or
attorney of any other person has represented, expressly or otherwise, that such
other person would not, in the event of litigation, seek to enforce the
foregoing waiver and (b) acknowledges that it and the other parties hereto have
been induced to enter into this security agreement and the other collateral
documents by, among other things, the mutual waivers and certifications in this
Section 6.13.4.

6.14. Notices.

6.14.1. General. Unless otherwise expressly provided herein, all notices and
other communications provided for hereunder shall be in writing (including by
facsimile transmission). All such written notices shall be mailed by registered
or certified mail, faxed, or delivered to the applicable address, facsimile
number, or (subject to Section 6.14.2 below) electronic mail address, and all
notices and other communications expressly permitted hereunder to be given by
telephone shall be made to the applicable telephone number, as follows (or, as
to each party at such other address as shall be designated by such party in a
written notice to the other parties delivered in compliance with this
Section 6.14):

(i) If to any Grantor:

c/o Allied Capital Corporation
1919 Pennsylvania Avenue, N.W.
Washington, DC 20006-3434
Attention: Penni F. Roll, Chief Financial Officer
Telephone/Telecopy: (202) 721-6192

with a copy to:

c/o Allied Capital Corporation
1919 Pennsylvania Avenue, N.W.
Washington, DC 20006-3434
Attention: Alexander D. Fine, Executive Vice President
Telephone/Telecopy: (202) 721-6101

with a further copy to:

      (ii)  
Dickstein Shapiro LLP
1825 Eye Street, N.W.
Washington, D.C. 20006
Attention: Howard S. Jatlow
Telecopy: (202) 379-9276
If to Collateral Agent:

U.S. Bank National Association
One Federal Street, Third Floor
Boston, MA 02110

          Attention: Ralph J. Creasia, Jr., Vice President     ALLIED CAPITAL
LENDERS AND NOTEHOLDERS
Telecopy:(866) 832-3895     Telephone: (617) 603-6517     Email:  
ralph.creasia@usbank.com
   
with a copy to:
 
   
Nixon Peabody LLP
100 Summer Street
Boston, MA 02110-2131
Attention:
Telecopy:
Telephone:
 

Amelia Charamba, Esq.
866-244-1527
617-345-1041

Notices sent by hand or overnight courier service, or mailed by certified or
registered mail, shall be deemed to have been given when received; notices sent
by telecopier shall be deemed to have been given when sent (except that, if not
given during normal business hours for the recipient, shall be deemed to have
been given at the opening of business on the next Business Day for the
recipient). Notices delivered through electronic communications to the extent
provided in Section 6.14.2 below, shall be effective as provided in such
Section 6.14.2.

6.14.2. Electronic Communications. Any party hereunder may, in its discretion,
agree to accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it; provided that approval of
such procedures may be limited to particular notices or communications. Unless
the receiving party otherwise prescribes, (a) notices and other communications
sent to an e-mail address shall be deemed received upon the sender’s receipt of
an acknowledgement from the intended recipient (such as by the “return receipt
requested” function, as available, return e-mail or other written
acknowledgement); provided that if such notice or other communication is not
sent during the normal business hours of the recipient, such notice or
communication shall be deemed to have been sent at the opening of business on
the next Business Day for the recipient, and (b) notices or communications
posted to an Internet or intranet website shall be deemed received upon the
deemed receipt by the intended recipient at its e-mail address as described in
the foregoing clause (a) of notification that such notice or communication is
available and identifying the website address therefor.

6.15. Non-Liability of Collateral Agent and Secured Parties. None of Collateral
Agent or any Secured Party shall have any fiduciary responsibilities to any
Grantor; and no provision in this Security Agreement or in any of the other
Collateral Documents, and no course of dealing between or among any of the
parties hereto, shall be deemed to create any fiduciary duty owing by Collateral
Agent or any Secured Party to any other Secured Party, any Grantor, or any
Subsidiary of any Grantor. None of Collateral Agent or any Secured Party
undertakes any responsibility to any Grantor to review or inform any Grantor of
any matter in connection with any phase of any Grantor’s business or operations.
Subject to the terms of the Intercreditor Agreement, the Collateral Agent shall
not be responsible for the existence, genuineness or value of any of the
Collateral or for the validity, perfection, priority or enforceability of the
Liens in any of the Collateral, whether impaired by operation of law or by
reason of any action or omission to act on its part hereunder for the validity
or sufficiency of the Collateral or any agreement or assignment contained
therein, for the validity of the title of the Grantor to the Collateral, for
insuring the Collateral or for the payment of taxes, charges, assessments or
Liens upon the Collateral or otherwise as to the maintenance of the Collateral.
The Collateral Agent is hereby authorized and directed to execute and deliver
the other Collateral Documents to which it is a party and all other documents
and instruments delivered in connection therewith on or about the date hereof.
In performing under the Collateral Documents, the Collateral Agent shall have
all such rights, protections and immunities granted it under the Intercreditor
Agreement in respect of the Collateral Documents. Subject to the terms of the
Intercreditor Agreement, the Collateral Agent shall have no obligation to
perform or exercise any discretionary act.

6.16. Severability of Provisions. Any provision of this Security Agreement which
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating the remainder of such provision or the
remaining provisions or affecting the validity or enforceability of such
provision in any other jurisdiction.

6.17. Entirety. The rights and obligations of Grantors, Collateral Agent, and
the Secured Parties shall be determined solely from written agreements,
documents, and instruments, and any prior oral agreements between such parties
are superseded by and merged into such writings. This Security Agreement (as
amended in writing from time to time) and the other written Financing Documents
and Collateral Documents, including, without limitation, the Intercreditor
Agreement, executed by any Grantor and, as applicable, any of Collateral Agent
or any Secured Party (together with all commitment letters and fee letters only
as they relate to the payment of fees after the date hereof) represent the final
agreement between Grantors, Collateral Agent, and the Secured Parties, and may
not be contradicted by evidence of prior, contemporaneous, or subsequent oral
agreements by such parties. There are no unwritten oral agreements between such
parties.

6.18. Construction. Collateral Agent and each Grantor acknowledge that each of
them has had the benefit of legal counsel of its own choice and has been
afforded an opportunity to review this Security Agreement and the other
Collateral Documents with its legal counsel and that this Security Agreement and
the other Collateral Documents shall be construed as if jointly drafted by
Collateral Agent and Grantors.

6.19. USA Patriot Act. Each of the Secured Parties that is subject to the Act
(as hereinafter defined) and Collateral Agent (for itself and not on behalf of
any Secured Party) hereby notifies each Grantor that pursuant to the
requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)) (the “Act”), it is required to obtain, verify and record
information that identifies Grantors, which information includes the name and
address of Grantors and other information that will allow such Collateral Agent
or each Secured Party, as applicable, to identify Grantor in accordance with the
Act. Each Grantor shall, promptly following a request for information by
Collateral Agent or any Secured Party, provide all documentation and other
information that Collateral Agent or any such Secured Party requests in order to
comply with its ongoing obligations under applicable “know your customer” and
anti-money laundering rules and regulations, including the Act.

6.20. Confidentiality.

6.20.1. Collateral Agent will maintain the confidentiality of Confidential
Information in accordance with its standard procedures adopted by Collateral
Agent to protect confidential information of third parties delivered to
Collateral Agent, provided that Collateral Agent may deliver or disclose
Confidential Information to (i) its Affiliates and to its and their directors,
trustees, officers, employees, agents and attorneys (to the extent such
disclosure reasonably relates to the administration of this Security Agreement
or the Intercreditor Agreement), (ii) its financial advisors and other
professional advisors who agree to hold confidential the Confidential
Information substantially in accordance with the terms of this Section 6.20,
(iii) any Secured Party, (iv) any Person that is a prospective assignee of
Collateral Agent (if such Person has agreed in writing prior to its receipt of
such Confidential Information to be bound by the provisions of this Section
6.20), (v) any federal or state regulatory authority having jurisdiction over
Collateral Agent, or (vi) any other Person to which such delivery or disclosure
may be necessary or appropriate (w) to effect compliance with any law, rule,
regulation or order applicable to Collateral Agent, (x) in response to any
subpoena or other legal process, (y) in connection with any litigation to which
Collateral Agent is a party or (z) if an Event of Default has occurred and is
continuing, to the extent Collateral Agent may reasonably determine such
delivery and disclosure to be necessary or appropriate in the enforcement or for
the protection of the rights and remedies under this Security Agreement, the
Intercreditor Agreement, or any other Collateral Document.

6.20.2. For the purposes of this Section 6.20, “Confidential Information” means
information delivered to Collateral Agent by or on behalf of Borrower or a
Consolidated Subsidiary in connection with the transactions contemplated by or
otherwise pursuant to this Security Agreement, provided that such term does not
include information that (a) was publicly known or otherwise known to Collateral
Agent prior to the time of such disclosure, (b) subsequently becomes publicly
known through no act or omission by Collateral Agent or any Person acting on
Collateral Agent’s behalf, or (c) otherwise becomes known to Collateral Agent
other than through disclosure by the Borrower or a Consolidated Subsidiary.

6.21. Intercreditor Agreement. It is expressly understood, agreed and
acknowledged that certain definitions, remedies, procedures and other provisions
hereof are described by way of cross reference to the Intercreditor Agreement,
and the parties hereto agree that (i) the definitions of “Affiliate”, “Bank Loan
Documents”, “Cash Management Bank”, “Default”, “Disposition” or “Dispose”,
“Enforcement Direction”, “Event of Default”, “Financing Documents”, “Notes”,
“Net Proceeds”, “Noteholders”, “Required Noteholders”, “Required Secured
Creditors”, “Senior Secured Obligations” “Special Collateral Account” and
“Special Event of Default” contained in Section 1 of the Intercreditor Agreement
and (ii) the provisions of Sections 3.4 and 6.4 of the Intercreditor Agreement
may not be modified or amended without the Grantors’ prior written consent. Any
changes to such definitions or Sections without the Grantors’ prior written
consent shall not be effective against the Grantors, and this Security Agreement
shall be interpreted as if such amendments, modifications or other changes had
not been made.

[Remainder of Page Intentionally Blank.
Signature Page to Follow.]

IN WITNESS WHEREOF, each Grantor and Collateral Agent have caused this Security
Agreement to be executed and delivered by their respective officers thereunto
duly authorized as of the date first written above.

GRANTOR:

ALLIED CAPITAL CORPORATION, a Maryland corporation

By: /s/ Penni F. Roll
Name: Penni F. Roll
Title: Chief Financial Officer

A.C. CORPORATION, a Delaware corporation

By: /s/ Penni F. Roll
Name: Penni F. Roll
Title: Chief Financial Officer

ALLIED CAPITAL HOLDINGS LLC, a Delaware limited

liability company

By: Allied Capital Corporation, its sole member

By: /s/ Penni F. Roll
Name: Penni F. Roll
Title: Chief Financial Officer

ALLIED CAPITAL REIT, INC., a Maryland corporation

By: /s/ Penni F. Roll
Name: Penni F. Roll
Title: Chief Financial Officer

ACGP I, LLC, a Delaware limited liability company

By: A.C. Corporation, its sole member

By: /s/ Penni F. Roll
Name: Penni F. Roll
Title: Chief Financial Officer

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ACKB LLC, a Delaware limited liability company

By: A.C. Corporation, its sole member

By: /s/ Penni F. Roll
Name: Penni F. Roll
Title: Chief Financial Officer

ACSM LLC, a Delaware limited liability company

By: A.C. Corporation, its sole member

By: /s/ Penni F. Roll
Name: Penni F. Roll
Title: Chief Financial Officer

AC FINANCE LLC, a Delaware limited liability company

By: A.C. Corporation, its sole member

By: /s/ Penni F. Roll
Name: Penni F. Roll
Title: Chief Financial Officer

A.C. MANAGEMENT SERVICES, LLC, a Delaware limited

liability company

By: A.C. Corporation, its sole member

By: /s/ Penni F. Roll
Name: Penni F. Roll
Title: Chief Financial Officer

ALLIED CAPITAL PROPERTY LLC, a Delaware limited

liability company

By: Allied Capital REIT, Inc., its sole member

By: /s/ Penni F. Roll
Name: Penni F. Roll
Title: Chief Financial Officer

AMP ADMIN LLC, a Delaware limited liability company

By: A.C. Corporation, its sole member

By: /s/ Penni F. Roll
Name: Penni F. Roll
Title: Chief Financial Officer

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COLLATERAL AGENT:

U.S. BANK NATIONAL ASSOCIATION, a national banking

association, solely in its capacity as Collateral Agent

By: /s/ Ralph J. Creasia, Jr.
Name: Ralph J. Creasia, Jr.
Title: Vice President

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