Exhibit 10.7
EXECUTION COPY
PLEDGE AND SECURITY AGREEMENT
dated as of March 26, 2007
between
EACH OF THE GRANTORS PARTY HERETO
and
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Collateral Agent

 

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TABLE OF CONTENTS

              PAGE  
SECTION 1. DEFINITIONS; GRANT OF SECURITY
    1  
1.1     General Definitions
    1  
1.2     Definitions; Interpretation
    7  
 
       
SECTION 2. GRANT OF SECURITY
    8  
2.1     Grant of Security
    8  
2.2     Certain Limited Exclusions
    9  
 
       
SECTION 3. SECURITY FOR OBLIGATIONS; GRANTORS REMAIN LIABLE
    9  
3.1     Security for Obligations
    9  
3.2     Continuing Liability Under Collateral
    9  
 
       
SECTION 4. REPRESENTATIONS AND WARRANTIES AND COVENANTS
    10  
4.1     Generally
    10  
4.2     Equipment and Inventory
    13  
4.3     Receivables
    14  
4.4     Investment Related Property
    16  
4.5     Material Contracts
    22  
4.6     Letter of Credit Rights
    23  
4.7     Intellectual Property
    24  
4.8     Commercial Tort Claims
    27  
 
       
SECTION 5. ACCESS; RIGHT OF INSPECTION AND FURTHER ASSURANCES ADDITIONAL
GRANTORS
    27  
5.1     Access; Right of Inspection
    28  
5.2     Further Assurances
    28  
5.3     Additional Grantors
    29  
 
       
SECTION 6. COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT
    29  
6.1     Power of Attorney
    29  
6.2     No Duty on the Part of Collateral Agent or Secured Parties
    30  
 
       
SECTION 7. REMEDIES
    30  
7.1     Generally
    30  
7.2     Application of Proceeds
    32  
7.3     Sales on Credit
    32  
7.4     Deposit Accounts
    32  
7.5     Investment Related Property
    32  
7.6     Intellectual Property
    33  
7.7     Cash Proceeds
    35  
7.8     Acknowledgement
    35  
 
       
SECTION 8. COLLATERAL AGENT
    35  
 
       
SECTION 9. CONTINUING SECURITY INTEREST; TRANSFER OF LOANS
    36  

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              PAGE  
SECTION 10. STANDARD OF CARE; COLLATERAL AGENT MAY PERFORM
    36  
 
       
SECTION 11. MISCELLANEOUS
    37  
 
       
SCHEDULE 4.1 — GENERAL INFORMATION
       
 
       
SCHEDULE 4.2 — LOCATION OF EQUIPMENT AND INVENTORY
       
 
       
SCHEDULE 4.4 — INVESTMENT RELATED PROPERTY
       
 
       
SCHEDULE 4.5 — MATERIAL CONTRACTS
       
 
       
SCHEDULE 4.6 — DESCRIPTION OF LETTERS OF CREDIT
       
 
       
SCHEDULE 4.7 — INTELLECTUAL PROPERTY — EXCEPTIONS
       
 
       
SCHEDULE 4.8 — COMMERCIAL TORT CLAIMS
       
 
       
EXHIBIT A — PLEDGE SUPPLEMENT
       
 
       
EXHIBIT B — UNCERTIFICATED SECURITIES CONTROL AGREEMENT
       
 
       
EXHIBIT C — SECURITIES ACCOUNT CONTROL AGREEMENT
       
 
       
EXHIBIT D — DEPOSIT ACCOUNT CONTROL AGREEMENT
       
 
       
EXHIBIT E — TRADEMARK SECURITY AGREEMENT
       
 
       
EXHIBIT F — COPYRIGHT SECURITY AGREEMENT
       
 
       
EXHIBIT G — PATENT SECURITY AGREEMENT
       

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          This PLEDGE AND SECURITY AGREEMENT, dated as of March 26, 2007 (this
“Agreement”), between EACH OF THE UNDERSIGNED, whether as an original signatory
hereto or as an Additional Grantor (as herein defined) (each, a “Grantor”), and
Wachovia Bank, National Association (“Wachovia Bank”), as collateral agent for
the Secured Parties (as herein defined) (in such capacity as collateral agent,
the “Collateral Agent").
RECITALS:
     WHEREAS, reference is made to that certain Credit and Guaranty Agreement,
dated as of the date hereof (as it may be amended, restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”), by and among
AMERIGROUP CORPORATION (“Company”), a Delaware corporation, as Borrower, certain
Subsidiaries of Company, as Guarantors, the lenders party thereto from time to
time (the “Lenders”), WACHOVIA CAPITAL MARKETS, LLC, as joint lead arranger and
joint bookrunner, GOLDMAN SACHS CREDIT PARTNERS L.P., as joint lead arranger,
joint bookrunner and syndication agent, and Wachovia Bank, as administrative
agent and as collateral agent;
     WHEREAS, subject to the terms and conditions of the Credit Agreement,
certain Grantors may enter into one or more Hedge Agreements with one or more
Lender Counterparties;
     WHEREAS, in consideration of the extensions of credit and other
accommodations of Lenders and Lender Counterparties as set forth in the Credit
Agreement and the Hedge Agreements, respectively, each Grantor has agreed to
secure such Grantor’s obligations under the Credit Documents and the Hedge
Agreements as set forth herein; and
     NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, each Grantor and the Collateral Agent
agree as follows:
SECTION 1. DEFINITIONS; GRANT OF SECURITY.
     1.1 General Definitions. In this Agreement, the following terms shall have
the following meanings:
          “Account Debtor” shall mean each Person who is obligated on a
Receivable or any Supporting Obligation related thereto.
          “Accounts” shall mean all “accounts” as defined in Article 9 of the
UCC, including Health-Care Insurance Receivables.
          “Additional Grantors” shall have the meaning assigned in Section 5.3.
          “Agreement” shall have the meaning set forth in the preamble.
          “Assigned Agreements” shall mean all agreements and contracts to which
such Grantor is a party as of the date hereof, or to which such Grantor becomes
a party after the date hereof, including, without limitation, each Material
Contract, as each such agreement may be amended, supplemented or otherwise
modified from time to time.
          “Bankruptcy Code” shall mean Title 11 of the United States Code
entitled “Bankruptcy”, as now and hereafter in effect, or any successor statute.

 

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          “Cash Proceeds” shall have the meaning assigned in Section 7.7.
          “Chattel Paper” shall mean all “chattel paper” as defined in Article 9
of the UCC, including, without limitation, “electronic chattel paper” or
“tangible chattel paper”, as each term is defined in Article 9 of the UCC.
          “Collateral” shall have the meaning assigned in Section 2.1.
          “Collateral Account” shall mean any account established by the
Collateral Agent.
          “Collateral Agent” shall have the meaning set forth in the preamble.
          “Collateral Records” shall mean 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 information
relating to any of the Collateral or are otherwise necessary or helpful in the
collection thereof or realization thereupon.
          “Collateral Support” shall mean 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.
          “Commercial Tort Claims” shall mean all “commercial tort claims” as
defined in Article 9 of the UCC, including, without limitation, all commercial
tort claims listed on Schedule 4.8 (as such schedule may be amended or
supplemented from time to time).
          “Commodities Accounts” (i) shall mean all “commodity accounts” as
defined in Article 9 of the UCC and (ii) shall include, without limitation, all
of the accounts listed on Schedule 4.4 under the heading “Commodities Accounts”
(as such schedule may be amended or supplemented from time to time).
          “Company” shall have the meaning set forth in the recitals.
          “Controlled Foreign Corporation” shall mean “controlled foreign
corporation” as defined in the Tax Code.
          “Copyright Licenses” shall mean any and all agreements providing for
the granting of any right in or to Copyrights (whether such Grantor is licensee
or licensor thereunder) including, without limitation, each agreement referred
to in Schedule 4.7(B) (as such schedule may be amended or supplemented from time
to time).
          “Copyrights” shall mean all United States, and foreign copyrights
(including Community designs), including but not limited to 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: (i) all registrations and applications therefor
including, without limitation, the registrations and applications referred to in
Schedule 4.7(A) (as such schedule may be amended or supplemented from time to
time), (ii) all extensions and renewals thereof, (iii) all rights corresponding
thereto throughout the world, (iv) all rights to sue for past, present and
future infringements thereof, and (v) all Proceeds of the

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foregoing, including, without limitation, licenses, royalties, income, payments,
claims, damages and proceeds of suit.
          “Credit Agreement” shall have the meaning set forth in the recitals.
          “Deposit Accounts” (i) shall mean all “deposit accounts” as defined in
Article 9 of the UCC and (ii) shall include, without limitation, all of the
accounts listed on Schedule 4.4 under the heading “Deposit Accounts” (as such
schedule may be amended or supplemented from time to time).
          “Documents” shall mean all “documents” as defined in Article 9 of the
UCC.
          “Equipment” shall mean: (i) all “equipment” as defined in Article 9 of
the UCC, (ii) all machinery, manufacturing equipment, data processing equipment,
computers, office equipment, furnishings, furniture, appliances, fixtures and
tools (in each case, regardless of whether characterized as equipment under the
UCC) and (iii) all accessions or additions thereto, all parts thereof, whether
or not at any time of determination incorporated or installed therein or
attached thereto, and all replacements therefor, wherever located, now or
hereafter existing, including any fixtures.
          “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any successor thereto.
          “General Intangibles” (i) shall mean all “general intangibles” as
defined in Article 9 of the UCC, including “payment intangibles” also as defined
in Article 9 of the UCC and (ii) shall include, without limitation, all interest
rate or currency protection or hedging arrangements, all tax refunds, all
licenses, permits, concessions and authorizations, all Assigned Agreements and
all Intellectual Property (in each case, regardless of whether characterized as
general intangibles under the UCC).
          “Goods” (i) shall mean all “goods” as defined in Article 9 of the UCC
and (ii) shall include, without limitation, all Inventory and Equipment (in each
case, regardless of whether characterized as goods under the UCC).
          “Grantors” shall have the meaning set forth in the preamble.
          “Health-Care Insurance Receivable” shall mean all
“health-care-insurance receivable” as defined in Article 9 of the UCC.
          “Indemnitee” shall mean the Collateral Agent, and its and its
Affiliates’ officers, partners, directors, trustees, employees, agents.
          “Instruments” shall mean all “instruments” as defined in Article 9 of
the UCC.
          “Insurance” shall mean (i) all insurance policies covering any or all
of the Collateral (regardless of whether the Collateral Agent is the loss payee
thereof) and (ii) any key man life insurance policies.
          “Intellectual Property” shall mean, collectively, the Copyrights, the
Copyright Licenses, the Patents, the Patent Licenses, the Trademarks, the
Trademark Licenses, the Trade Secrets, and the Trade Secret Licenses.

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          “Inventory” shall mean (i) all “inventory” as defined in Article 9 of
the UCC and (ii) all goods held for sale or lease or to be furnished under
contracts of service or so leased or furnished, all raw materials, work in
process, finished goods, and materials used or consumed in the manufacture,
packing, shipping, advertising, selling, leasing, furnishing or production of
such inventory or otherwise used or consumed in any Grantor’s business; all
goods in which any Grantor has an interest in mass or a joint or other interest
or right of any kind; and all goods which are returned to or repossessed by any
Grantor, all computer programs embedded in any goods and all accessions thereto
and products thereof (in each case, regardless of whether characterized as
inventory under the UCC).
          “Investment Accounts” shall mean the Collateral Account, Securities
Accounts, Commodities Accounts and Deposit Accounts.
          “Investment Related Property” shall mean: (i) all “investment
property” (as such term is defined in Article 9 of the UCC) and (ii) all of the
following (regardless of whether classified as investment property under the
UCC): all Pledged Equity Interests, Pledged Debt, the Investment Accounts and
certificates of deposit.
          “Lender” shall have the meaning set forth in the recitals.
          “Letter of Credit Right” shall mean “letter-of-credit right” as
defined in Article 9 of the UCC.
          “Lien” shall mean (i) any lien, mortgage, pledge, assignment, security
interest, charge or encumbrance of any kind (including any agreement to give any
of the foregoing, any conditional sale or other title retention agreement, and
any lease in the nature thereof) and any option, trust or other preferential
arrangement having the practical effect of any of the foregoing and (ii) in the
case of Pledged Equity Interests, any purchase option, call or similar right of
a third party with respect to such Pledged Equity Interests.
          “Money” shall mean “money” as defined in the UCC.
          “Non-Assignable Contract” shall mean any agreement, contract or
license to which any Grantor is a party that by its terms purports to restrict
or prevent the assignment or granting of a security interest therein (either by
its terms or by any federal or state statutory prohibition or otherwise
irrespective of whether such prohibition or restriction is enforceable under
Section 9-406 through 409 of the UCC).
          “Patent Licenses” shall mean all agreements providing for the granting
of any right in or to Patents (whether such Grantor is licensee or licensor
thereunder) including, without limitation, each agreement referred to in
Schedule 4.7(D) (as such schedule may be amended or supplemented from time to
time).
          “Patents” shall mean all United States and foreign patents and
certificates of invention, or similar industrial property rights, and
applications for any of the foregoing, including, but not limited to: (i) each
patent and patent application referred to in Schedule 4.7(C) hereto (as such
schedule may be amended or supplemented from time to time), (ii) all reissues,
divisions, continuations, continuations-in-part, extensions, renewals, and
reexaminations thereof, (iii) all rights corresponding thereto throughout the
world, (iv) all inventions and improvements described therein, (v) all rights to
sue for past, present and future infringements thereof, (vi) all licenses,
claims, damages, and proceeds of suit arising therefrom, and (vii) all Proceeds
of the

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foregoing, including, without limitation, licenses, royalties, income, payments,
claims, damages, and proceeds of suit.
          “Pledge Supplement” shall mean any supplement to this agreement in
substantially the form of Exhibit A.
          “Pledged Debt” shall mean all Indebtedness owed to such Grantor,
including, without limitation, all Indebtedness described on Schedule 4.4(A)
under the heading “Pledged Debt” (as such schedule may be amended or
supplemented from time to time), issued by the obligors named therein, the
instruments evidencing such Indebtedness, and all interest, cash, instruments
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
Indebtedness.
          “Pledged Equity Interests” shall mean all Pledged Stock, Pledged LLC
Interests, Pledged Partnership Interests and Pledged Trust Interests.
          “Pledged LLC Interests” shall mean all limited liability company
interests listed on Schedule 4.4(A) under the heading “Pledged LLC Interests”
(as such schedule may be amended or supplemented from time to time) 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” shall mean all interests in any
general partnership, limited partnership, limited liability partnership or other
partnership listed on Schedule 4.4(A) under the heading “Pledged Partnership
Interests” (as such schedule may be amended or supplemented from time to time)
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” shall mean all shares of capital stock owned by such
Grantor described on Schedule 4.4(A) under the heading “Pledged Stock” (as such
schedule may be amended or supplemented from time to time), 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.
          “Pledged Trust Interests” shall mean all interests in a Delaware
business trust or other trust including, without limitation, all trust interests
listed on Schedule 4.4(A) under the heading “Pledged Trust Interests” (as such
schedule may be amended or supplemented from time to time) and the certificates,
if any, representing such trust interests and any interest of such Grantor on
the books and records of such trust or on the books and records of any
securities intermediary pertaining to such interest and all dividends,
distributions, cash, warrants, rights,

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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 trust interests.
          “Proceeds” shall mean: (i) all “proceeds” as defined in Article 9 of
the UCC, (ii) payments or distributions made with respect to any Investment
Related Property and (iii) whatever is receivable or received when Collateral or
proceeds are sold, exchanged, collected or otherwise disposed of, whether such
disposition is voluntary or involuntary.
          “Receivables” shall mean all rights to payment, whether or not earned
by performance, for goods or other property sold, leased, licensed, assigned or
otherwise disposed of, or services rendered or to be rendered, including,
without limitation all such rights constituting or evidenced by any Account,
Chattel Paper, Instrument, General Intangible or Investment Related Property,
together with all of Grantor’s rights, if any, in any goods or other property
giving rise to such right to payment and all Collateral Support and Supporting
Obligations related thereto and all Receivables Records.
          “Receivables Records” shall mean (i) all original copies of all
documents, instruments or other writings or electronic records or other Records
evidencing the Receivables, (ii) all books, correspondence, credit or other
files, Records, ledger sheets or cards, invoices, and other papers relating to
Receivables, including, without limitation, all tapes, cards, computer tapes,
computer discs, computer runs, record keeping systems and other papers and
documents relating to the Receivables, whether in the possession or under the
control of Grantor or any computer bureau or agent from time to time acting for
Grantor or otherwise, (iii) all evidences of the filing of financing statements
and the registration of other instruments in connection therewith, and
amendments, supplements or other modifications thereto, notices to other
creditors or secured parties, and certificates, acknowledgments, or other
writings, including, without limitation, lien search reports, from filing or
other registration officers, (iv) all credit information, reports and memoranda
relating thereto and (v) all other written or nonwritten forms of information
related in any way to the foregoing or any Receivable.
          “Record” shall have the meaning specified in Article 9 of the UCC.
          “Secured Obligations” shall have the meaning assigned in Section 3.1.
          “Secured Parties” shall mean the Agents, Lenders and the Lender
Counterparties and shall include, without limitation, all former Agents, Lenders
and Lender Counterparties to the extent that any Obligations owing to such
Persons were incurred while such Persons were Agents, Lenders or Lender
Counterparties and such Obligations have not been paid or satisfied in full.
          “Securities” shall mean any stock, shares, partnership interests,
voting trust certificates, certificates of interest or participation in any
profit-sharing agreement or arrangement, options, warrants, bonds, debentures,
notes, or other evidences of indebtedness, secured or unsecured, convertible,
subordinated or otherwise, or in general any instruments commonly known as
“securities” or any certificates of interest, shares or participations in
temporary or interim certificates for the purchase or acquisition of, or any
right to subscribe to, purchase or acquire, any of the foregoing.
          “Securities Accounts” (i) shall mean all “securities accounts” as
defined in Article 8 of the UCC and (ii) shall include, without limitation, all
of the accounts listed on

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Schedule 4.4(A) under the heading “Securities Accounts” (as such schedule may be
amended or supplemented from time to time).
          “Supporting Obligation” shall mean all “supporting obligations” as
defined in Article 9 of the UCC.
          “Tax Code” shall mean the United States Internal Revenue Code of 1986,
as amended from time to time.
          “Trademark Licenses” shall mean any and all agreements providing for
the granting of any right in or to Trademarks (whether such Grantor is licensee
or licensor thereunder) including, without limitation, each agreement referred
to in Schedule 4.7(F) (as such schedule may be amended or supplemented from time
to time).
          “Trademarks” shall mean all United States, and foreign trademarks,
trade 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, but not limited to: (i) the
registrations and applications referred to in Schedule 4.7(E) (as such schedule
may be amended or supplemented from time to time), (ii) all extensions or
renewals of any of the foregoing, (iii) all of the goodwill of the business
connected with the use of and symbolized by the foregoing, (iv) the right to sue
for past, present and future infringement or dilution of any of the foregoing or
for any injury to goodwill, and (v) all Proceeds of the foregoing, including,
without limitation, licenses, royalties, income, payments, claims, damages, and
proceeds of suit.
          “Trade Secret Licenses” shall mean any and all agreements providing
for the granting of any right in or to Trade Secrets (whether such Grantor is
licensee or licensor thereunder) including, without limitation, each agreement
referred to in Schedule 4.7(G) (as such schedule may be amended or supplemented
from time to time).
          “Trade Secrets” shall mean 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 but not limited to: (i) the right to sue for past,
present and future misappropriation or other violation of any Trade Secret, and
(ii) all Proceeds of the foregoing, including, without limitation, licenses,
royalties, income, payments, claims, damages, and proceeds of suit.
          “UCC” shall mean the Uniform Commercial Code as in effect from time to
time in the State of New York or, when the context implies, the Uniform
Commercial Code as in effect from time to time in any other applicable
jurisdiction.
          “United States” shall mean the United States of America.
     1.2 Definitions; Interpretation. All capitalized terms used herein
(including the preamble and recitals hereto) and not otherwise defined herein
shall have the meanings ascribed thereto in the Credit Agreement or, if not
defined therein, in the UCC. References to “Sections,” “Exhibits” and
“Schedules” shall be to Sections, Exhibits and Schedules, as the case may be, of
this Agreement unless otherwise specifically provided. Section headings in this
Agreement are included herein for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose or be given any
substantive effect. Any of the terms defined

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herein may, unless the context otherwise requires, be used in the singular or
the plural, depending on the reference. The use herein of the word “include” or
“including”, when following any general statement, term or matter, shall not be
construed to limit such statement, term or matter to the specific items or
matters set forth immediately following such word or to similar items or
matters, whether or not nonlimiting language (such as “without limitation” or
“but not limited to” or words of similar import) is used with reference thereto,
but rather shall be deemed to refer to all other items or matters that fall
within the broadest possible scope of such general statement, term or matter. If
any conflict or inconsistency exists between this Agreement and the Credit
Agreement, the Credit Agreement shall govern. All references herein to
provisions of the UCC shall include all successor provisions under any
subsequent version or amendment to any Article of the UCC.
SECTION 2. GRANT OF SECURITY.
     2.1 Grant of Security. Each Grantor hereby grants to the Collateral Agent a
security interest in and continuing lien on all of such Grantor’s right, title
and interest in, to and under all personal property of such Grantor including,
but not limited to the following, in each case whether now owned or existing or
hereafter acquired or arising and wherever located (all of which being
hereinafter collectively referred to as the “Collateral”):
          (a) Accounts;
          (b) Chattel Paper;
          (c) Documents;
          (d) General Intangibles;
          (e) Goods;
          (f) Instruments;
          (g) Insurance;
          (h) Intellectual Property;
          (i) Investment Related Property;
          (j) Letter of Credit Rights;
          (k) Money;
          (l) Receivables and Receivable Records;
          (m) Commercial Tort Claims;
          (n) all Collateral Records, Collateral Support and Supporting
Obligations relating to any of the foregoing; and
          (o) all Proceeds, products, accessions, rents and profits of or in
respect of any of the foregoing.

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     2.2 Certain Limited Exclusions. Notwithstanding anything herein to the
contrary, in no event shall the Collateral include or the security interest
granted under Section 2.1 hereof attach to (a) any lease, license, contract,
property rights or agreement to which any Grantor is a party or any of its
rights or interests thereunder if and for so long as the grant of such security
interest shall constitute or result in (i) the abandonment, invalidation or
unenforceability of any right, title or interest of any Grantor therein or
(ii) in a breach or termination pursuant to the terms of, or a default under,
any such lease, license, contract property rights or agreement (other than to
the extent that any such term would be rendered ineffective pursuant to
Sections 9-406, 9-407, 9-408 or 9-409 of the UCC (or any successor provision or
provisions) of any relevant jurisdiction or any other applicable law (including
the Bankruptcy Code) or principles of equity), provided however that the
Collateral shall include and such security interest shall attach immediately at
such time as the condition causing such abandonment, invalidation or
unenforceability shall be remedied and to the extent severable, shall attach
immediately to any portion of such Lease, license, contract, property rights or
agreement that does not result in any of the consequences specified in (i) or
(ii) above; (b) any of 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 Tax 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 granted by each Grantor shall attach to, such greater
percentage of capital stock of each Controlled Foreign Corporation; (c) any
trademark applications filed in the United States Patent and Trademark Office on
the basis of any Grantor’s “intent-to-use” such trademark pursuant to 15 U.S.C.
1051 Section 1(b), unless and until evidence of use of the Trademark has been
filed with the United States Patent and Trademark Office pursuant to Section
1(c) or Section 1(d) of the Lanham Act (15 U.S.C. 1051, et seq.); or (d) cash
collateral in an amount not to exceed $50,433,600 solely to the extent held by
Bank of America, N.A. for the purpose of cash collateralizing outstanding letter
of credit #3085765; provided, that upon the release of such cash collateral to
the Grantors and their Subsidiaries, such cash collateral shall constitute
Collateral hereunder and the security interest granted under Section 2.1 hereof
shall attach thereto.
SECTION 3. SECURITY FOR OBLIGATIONS; GRANTORS REMAIN LIABLE.
     3.1 Security for Obligations. This Agreement secures, and the Collateral is
collateral security for, the prompt and complete payment or performance in full
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, 11 U.S.C. §362(a) (and any successor provision thereof)),
of all Obligations with respect to every Grantor (the “Secured Obligations”).
     3.2 Continuing Liability Under Collateral. Notwithstanding anything herein
to the contrary, (i) each Grantor shall remain liable for all obligations under
the Collateral and nothing contained herein is intended or shall be a delegation
of duties to the Collateral Agent or any Secured Party, (ii) each Grantor shall
remain liable under each of the agreements included in the Collateral,
including, without limitation, any agreements relating to Pledged Partnership
Interests or Pledged LLC Interests, to perform all of the obligations undertaken
by it thereunder all in accordance with and pursuant to the terms and provisions
thereof and neither the Collateral Agent nor any Secured Party shall have any
obligation or liability under any of such agreements by reason of or arising out
of this Agreement or any other document related thereto nor shall the Collateral
Agent nor any Secured Party have any obligation to make any inquiry as to the
nature or sufficiency of any payment received by it or have any obligation to
take any action to collect or

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enforce any rights under any agreement included in the Collateral, including,
without limitation, any agreements relating to Pledged Partnership Interests or
Pledged LLC Interests, and (iii) the exercise by the Collateral Agent of any of
its rights hereunder shall not release any Grantor from any of its duties or
obligations under the contracts and agreements included in the Collateral.
SECTION 4. REPRESENTATIONS AND WARRANTIES AND COVENANTS.
     4.1 Generally.
          (a) Representations and Warranties. Each Grantor hereby represents and
warrants, on the Closing Date and on each Credit Date, that:
          (i) it owns the Collateral purported to be owned by it or otherwise
has the rights it purports to have in each item of Collateral and, as to all
Collateral whether now existing or hereafter acquired, will continue to own or
have such rights in each item of the Collateral, in each case free and clear of
any and all Liens, rights or claims of all other Persons, including, without
limitation, liens arising as a result of such Grantor becoming bound (as a
result of merger or otherwise) as debtor under a security agreement entered into
by another Person, other than Permitted Liens;
          (ii) it has indicated on Schedule 4.1(A)(as such schedule may be
amended or supplemented from time to time): (w) the type of organization of such
Grantor, (x) the jurisdiction of organization of such Grantor, (y) its
organizational identification number and (z) the jurisdiction where the chief
executive office or its sole place of business is (or the principal residence if
such Grantor is a natural person), and for the one-year period preceding the
date hereof has been, located.
          (iii) the full legal name of such Grantor is as set forth on
Schedule 4.1(A) and it has not done in the last five (5) years, and does not do,
business under any other name (including any trade name or fictitious business
name) except for those names set forth on Schedule 4.1(B) (as such schedule may
be amended or supplemented from time to time);
          (iv) except as provided on Schedule 4.1(C), it has not changed its
name, jurisdiction of organization, chief executive office or sole place of
business (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;
          (v) it has not within the last five (5) years become bound (whether as
a result of merger or otherwise) as debtor under a security agreement entered
into by another Person, which has not heretofore been terminated other than the
agreements identified on Schedule 4.1(D) hereof (as such schedule may be amended
or supplemented from time to time);
          (vi) with respect to each agreement identified on Schedule 4.1(D), it
has indicated on Schedule 4.1 (A) and Schedule 4.1(B) the information required
pursuant to Section 4.1(a)(ii), (iii) and (iv) with respect to the debtor under
each such agreement;

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          (vii) (u) upon the filing of all UCC financing statements naming each
Grantor as “debtor” and the Collateral Agent as “secured party” and describing
the Collateral in the filing offices set forth opposite such Grantor’s name on
Schedule 4.1(E) hereof (as such schedule may be amended or supplemented from
time to time) and other filings delivered by each Grantor, (v) upon delivery of
all Instruments, Chattel Paper and certificated Pledged Equity Interests and
Pledged Debt, (w) upon sufficient identification of Commercial Tort Claims,
(x) upon execution of a control agreement establishing the Collateral Agent’s
“control” (within the meaning of Section 8-106, 9-106 or 9-104 of the UCC, as
applicable) with respect to any Investment Account, (y) upon consent of the
issuer with respect to Letter of Credit Rights, and (z) to the extent not
subject to Article 9 of the UCC, upon recordation of the security interests
granted hereunder in Patents, Trademarks and Copyrights in the applicable
intellectual property registries, including but not limited to the United States
Patent and Trademark Office and the United States Copyright Office, the security
interests granted to the Collateral Agent hereunder constitute valid and
perfected First Priority Liens (subject in the case of priority only to
Permitted Liens and to the rights of the United States government (including any
agency or department thereof) with respect to United States government
Receivables) on all of the Collateral; provided, however, that additional
filings in the United States Patent and Trademark Office and United States
Copyright Office may be necessary with respect to the perfection of the
Collateral Agent’s Lien in United States registrations and applications for
Trademarks, Patents and Copyrights which are filed by, issued to, or acquired by
a Grantor after the date hereof and, provided, further, that additional filings
and/or other actions may be required to perfect the Collateral Agent’s Lien in
Intellectual Property Collateral which is created under the laws of a
jurisdiction outside the United States;
          (viii) all actions and consents, including all filings, notices,
registrations and recordings necessary or desirable for the exercise by the
Collateral Agent of the voting or other rights provided for in this Agreement or
the exercise of remedies in respect of the Collateral have been made or
obtained, subject to Section 7.8, if applicable;
          (ix) other than the financing statements filed in favor of the
Collateral Agent, no effective UCC financing statement, fixture filing or other
instrument similar in effect under any applicable law covering all or any part
of the Collateral is on file in any filing or recording office except for
(x) financing statements for which proper termination statements have been
delivered to the Collateral Agent for filing and (y) financing statements filed
in connection with Permitted Liens;
          (x) subject to Section 7.8, if applicable, and other than as has been
obtained or made, no authorization, approval or other action by, and no notice
to or filing with, any Governmental Authority or regulatory body is required for
either (i) the pledge or grant by any Grantor of the Liens purported to be
created in favor of the Collateral Agent hereunder or (ii) the exercise by
Collateral Agent of any rights or remedies in respect of any Collateral (whether
specifically granted or created hereunder or created or provided for by
applicable law), except (A) for the filings contemplated by clause (vii) above
and (B) as may be required, in connection with the disposition of any Investment
Related Property, by laws generally affecting the offering and sale of
Securities;

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          (xi) all information supplied by any Grantor with respect to any of
the Collateral (in each case taken as a whole with respect to any particular
Collateral) is accurate and complete in all material respects;
          (xii) none of the Collateral constitutes, or is the Proceeds of, “farm
products” (as defined in the UCC);
          (xiii) it does not own any “as extracted collateral” (as defined in
the UCC) or any timber to be cut;
          (xiv) Except as described on Schedule 4.1(D), such Grantor has not
become bound as a debtor, either by contract or by operation of law, by a
security agreement previously entered into by another Person; and
          (xv) Such Grantor has been duly organized as an entity of the type as
set forth opposite such Grantor’s name on Schedule 4.1(A) solely under the laws
of the jurisdiction as set forth opposite such Grantor’s name on Schedule 4.1(A)
and remains duly existing as such. Such Grantor has not filed any certificates
of domestication, transfer or continuance in any other jurisdiction.
          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees
that:
          (i) except for the security interest created by this Agreement, it
shall not create or suffer to exist any Lien upon or with respect to any of the
Collateral, except Permitted Liens, and such Grantor shall defend the Collateral
against all Persons at any time claiming any interest therein;
          (ii) it shall not produce, use or permit any Collateral to be used
unlawfully or in violation of any provision of this Agreement or any applicable
statute, regulation or ordinance or any policy of insurance covering the
Collateral;
          (iii) it shall not change such Grantor’s name, identity, corporate
structure (e.g., by merger, consolidation, change in corporate form or
otherwise) sole place of business (or principal residence if such Grantor is a
natural person), chief executive office, type of organization or jurisdiction of
organization unless it shall have (a) notified the Collateral Agent in writing,
by executing and delivering to the Collateral Agent a completed Pledge
Supplement, substantially in the form of Exhibit A attached hereto, together
with all Supplements to Schedules thereto, at least twenty (20) days prior to
any such change or establishment, identifying such new proposed name, identity,
corporate structure, sole place of business (or principal residence if such
Grantor is a natural person), chief executive office, jurisdiction of
organization or trade name and providing such other information in connection
therewith as the Collateral Agent may reasonably request and (b) taken all
actions necessary or advisable to maintain the continuous validity, perfection
and the same or better priority of the Collateral Agent’s security interest in
the Collateral intended to be granted and agreed to hereby;
          (iv) if the Collateral Agent or any Secured Party gives value to
enable Grantor to acquire rights in or the use of any Collateral, it shall use
such value for such purposes;

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          (v) [Reserved];
          (vi) upon such Grantor or any officer of such Grantor obtaining
knowledge thereof, it shall promptly notify the Collateral Agent in writing of
any event that may have a Material Adverse Effect on the value of the Collateral
or any portion thereof, the ability of any Grantor or the Collateral Agent to
dispose of the Collateral or any portion thereof, or the rights and remedies of
the Collateral Agent in relation thereto, including, without limitation, the
levy of any legal process against the Collateral or any portion thereof;
          (vii) it shall not take or permit any action, other than as permitted
under the Credit Agreement, which would reasonably be expected to materially
impair the Collateral Agent’s rights in the Collateral; and
          (viii) it shall not sell, transfer or assign (by operation of law or
otherwise) any Collateral except as otherwise in accordance with the Credit
Agreement.
     4.2 Equipment and Inventory.
          (a) Representations and Warranties. Each Grantor represents and
warrants, on the Closing Date and on each Credit Date, that:
          (i) substantially all of the Equipment and Inventory, including all of
the material Equipment and Inventory, included in the Collateral is kept only at
the locations specified in Schedule 4.2 (as such schedule may be amended or
supplemented from time to time);
          (ii) any Goods now or hereafter produced by any Grantor included in
the Collateral have been and will be produced in compliance with the
requirements of the Fair Labor Standards Act, as amended; and
          (iii) none of the Inventory or Equipment is in the possession of an
issuer of a negotiable document (as defined in Section 7-104 of the UCC)
therefor or otherwise in the possession of a bailee or a warehouseman.
          (b) Covenants and Agreements. Each Grantor covenants and agrees that:
          (i) it shall keep the Equipment, Inventory and any Documents
evidencing any such Equipment and Inventory in the locations specified on
Schedule 4.2 (as such schedule may be amended or supplemented from time to time)
unless it shall have (a) promptly notified the Collateral Agent in writing, by
executing and delivering to the Collateral Agent a completed Pledge Supplement,
substantially in the form of Exhibit A attached hereto, together with all
Supplements to Schedules thereto, identifying such new locations and providing
such other information in connection therewith as the Collateral Agent may
reasonably request and (b) taken all actions necessary or advisable to maintain
the continuous validity, perfection and the same or better priority of the
Collateral Agent’s security interest in the Collateral intended to be granted
and agreed to hereby, or to enable the Collateral Agent to exercise and enforce
its rights and remedies hereunder, with respect to such Equipment and Inventory;

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          (ii) it shall keep correct and accurate records of the Inventory, as
is customarily maintained under similar circumstances by Persons of established
reputation engaged in similar business, and in any event in conformity with
GAAP;
          (iii) it shall not deliver any Document evidencing any Equipment and
Inventory to any Person other than the issuer of such Document to claim the
Goods evidenced therefor or the Collateral Agent;
          (iv) if any Equipment or Inventory is in possession or control of any
third party, each Grantor shall join with the Collateral Agent in notifying the
third party of the Collateral Agent’s security interest and use commercially
reasonable efforts to obtain an acknowledgment from the third party that it is
holding the Equipment and Inventory for the benefit of the Collateral Agent; and
          (v) with respect to any item of Equipment which is covered by a
certificate of title under a statute of any jurisdiction under the law of which
indication of a security interest on such certificate is required as a condition
of perfection thereof, upon the reasonable request of the Collateral Agent,
(A) provide information with respect to any such Equipment in excess of $250,000
individually or $500,000 in the aggregate, (B) execute and file with the
registrar of motor vehicles or other appropriate authority in such jurisdiction
an application or other document requesting the notation or other indication of
the security interest created hereunder on such certificate of title, and
(C) deliver to the Collateral Agent copies of all such applications or other
documents filed during such calendar quarter and copies of all such certificates
of title issued during such calendar quarter indicating the security interest
created hereunder in the items of Equipment covered thereby.
     4.3 Receivables.
          (a) Representations and Warranties. Each Grantor represents and
warrants, on the Closing Date and on each Credit Date, that:
          (i) to each Grantor’s knowledge, each Receivable (a) is and will be
the legal, valid and binding obligation of the Account Debtor in respect
thereof, representing an unsatisfied obligation of such Account Debtor, (b) is
and will be enforceable in accordance with its terms, (c) is not and will not be
subject to any setoffs, defenses, taxes, counterclaims (except with respect to
refunds, returns and allowances in the ordinary course of business with respect
to damaged merchandise) and (d) is and will be in compliance with all applicable
laws, whether federal, state, local or foreign;
          (ii) no Receivable of such Grantor in excess of $250,000 individually
or $500,000 in the aggregate requires the consent of the Account Debtor in
respect thereof in connection with the pledge hereunder, except any consent
which has been obtained; and
          (iii) no Receivable is evidenced by, or constitutes, an Instrument or
Chattel Paper which has not been delivered to, or otherwise subjected to the
control of, the Collateral Agent to the extent required by, and in accordance
with Section 4.3(c).
          (b) Covenants and Agreements: Each Grantor hereby covenants and agrees
that:

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          (i) it shall keep and maintain at its own cost and expense
satisfactory and complete records of the Receivables in accordance with its
business practice, including, but not limited to, the originals or certified
copies of all material documentation with respect to all Receivables and records
of all material payments received and all material credits granted on the
Receivables;
          (ii) it shall use commercially reasonable efforts to mark
conspicuously, in form and manner reasonably satisfactory to the Collateral
Agent, all Chattel Paper, Instruments and other evidence of Receivables (other
than any delivered to the Collateral Agent as provided herein), as well as the
Receivables Records with an appropriate reference to the fact that the
Collateral Agent has a security interest therein;
          (iii) it shall perform in all material respects all of its obligations
with respect to the Receivables;
          (iv) other than in the ordinary course of business as generally
conducted by it on and prior to the date hereof, and except as otherwise
provided in subsection (v) below and except as otherwise permitted under the
Credit Agreement, following an Event of Default, such Grantor shall not
(w) grant any extension or renewal of the time of payment of any Receivable,
(x) compromise or settle any dispute, claim or legal proceeding with respect to
any Receivable for less than the total unpaid balance thereof, (y) release,
wholly or partially, any Person liable for the payment thereof, or (z) allow any
credit or discount thereon;
          (v) except as otherwise provided in this subsection, each Grantor
shall continue to collect all amounts due or to become due to such Grantor under
the Receivables and any Supporting Obligation and diligently exercise each
material right it may have under any Receivable, any Supporting Obligation or
Collateral Support, in each case, at its own expense, and in connection with
such collections and exercise, such Grantor shall take such action as such
Grantor or the Collateral Agent may deem necessary or advisable. Notwithstanding
the foregoing, the Collateral Agent shall have the right following an Event of
Default to notify, or require any Grantor to notify, any Account Debtor of the
Collateral Agent’s security interest in the Receivables and any Supporting
Obligation and, in addition, at any time following the occurrence and during the
continuation of an Event of Default, the Collateral Agent may: (1) direct the
Account Debtors under any Receivables to make payment of all amounts due or to
become due to such Grantor thereunder directly to the Collateral Agent;
(2) notify, or require any Grantor to notify, each Person maintaining a lockbox
or similar arrangement to which Account Debtors under any Receivables have been
directed to make payment to remit all amounts representing collections on checks
and other payment items from time to time sent to or deposited in such lockbox
or other arrangement directly to the Collateral Agent; and (3) enforce, at the
expense of such Grantor, collection of any such Receivables and to adjust,
settle or compromise the amount or payment thereof, in the same manner and to
the same extent as such Grantor might have done. If the Collateral Agent
notifies any Grantor that it has elected to collect the Receivables in
accordance with the preceding sentence, any payments of Receivables received by
such Grantor shall be forthwith (and in any event within two (2) Business Days)
deposited by such Grantor in the exact form received, duly indorsed by such
Grantor to the Collateral Agent if required, in the Collateral Account
maintained under the sole dominion and control of the Collateral Agent, and
until so turned over, all amounts and proceeds (including checks and other
instruments) received by such Grantor in respect of the Receivables, any
Supporting

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Obligation or Collateral Support shall be received in trust for the benefit of
the Collateral Agent hereunder and shall be segregated from other funds of such
Grantor and such Grantor shall not adjust, settle or compromise the amount or
payment of any Receivable, or release wholly or partly any Account Debtor or
obligor thereof, or allow any credit or discount thereon; and
          (vi) it shall use its best efforts to keep in full force and effect
any Supporting Obligation or Collateral Support relating to any Receivable.
          (c) Delivery and Control of Receivables. With respect to any
Receivables in excess of $100,000 individually or $500,000 in the aggregate that
is evidenced by, or constitutes, Chattel Paper or Instruments, each Grantor
shall cause each originally executed copy thereof to be delivered to the
Collateral Agent (or its agent or designee) appropriately indorsed to the
Collateral Agent or indorsed in blank: (i) with respect to any such Receivables
in existence on the date hereof, on or prior to the date hereof and (ii) with
respect to any such Receivables hereafter arising, within fifteen (15) days of
such Grantor acquiring rights therein. With respect to any Receivables in excess
of $100,000 individually or $500,000 in the aggregate which would constitute
“electronic chattel paper” under Article 9 of the UCC, each Grantor shall take
all steps reasonably necessary to give the Collateral Agent control over such
Receivables (within the meaning of Section 9-105 of the UCC): (i) with respect
to any such Receivables in existence on the date hereof, on or prior to the date
hereof and (ii) with respect to any such Receivables hereafter arising, within
fifteen (15) days of such Grantor acquiring rights therein. Any Receivable not
otherwise required to be delivered or subjected to the control of the Collateral
Agent in accordance with this subsection (c) shall be delivered or subjected to
such control after the occurrence and during the continuance of an Event of
Default upon request of the Collateral Agent.
     4.4 Investment Related Property. 4.4.1
          4.4.1 Investment Related Property Generally
          (a) Covenants and Agreements. Each Grantor hereby covenants and agrees
that:
          (i) in the event it acquires rights in any Investment Related Property
after the date hereof, it shall deliver to the Collateral Agent a completed
Pledge Supplement, substantially in the form of Exhibit A attached hereto,
together with all Supplements to Schedules thereto, reflecting such new
Investment Related Property and all other Investment Related Property.
Notwithstanding the foregoing, it is understood and agreed that the security
interest of the Collateral Agent shall attach to all Investment Related Property
immediately upon any Grantor’s acquisition of rights therein and shall not be
affected by the failure of any Grantor to deliver a supplement to Schedule 4.4
as required hereby;
          (ii) except as provided in the next sentence, in the event such
Grantor receives any dividends, interest or distributions on any Investment
Related Property, or any securities or other property upon the merger,
consolidation, liquidation or dissolution of any issuer of any Investment
Related Property, then (a) such dividends, interest or distributions and
securities or other property shall be included in the definition of Collateral
without further action and (b) such Grantor shall immediately take all steps, if
any, necessary or advisable to ensure the validity, perfection, priority and, if
applicable,

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control of the Collateral Agent over such Investment Related Property
(including, without limitation, delivery thereof to the Collateral Agent) and
pending any such action such Grantor shall be deemed to hold such dividends,
interest, distributions, securities or other property in trust for the benefit
of the Collateral Agent and shall segregate such dividends, distributions,
Securities or other property from all other property of such Grantor.
Notwithstanding the foregoing, to the extent permitted by the Credit Agreement,
so long as no Event of Default shall have occurred and be continuing, the
Collateral Agent authorizes each Grantor to retain and dispose of all ordinary
cash dividends and distributions paid by the issuer and all scheduled payments
of interest;
          (iii) each Grantor consents to the grant by each other Grantor of a
Security Interest in all Investment Related Property to the Collateral Agent.
          (b) Delivery and Control.
          (i) Each Grantor agrees that with respect to any Investment Related
Property in which it currently has rights it shall comply with the provisions of
this Section 4.4.1(b) on or before the Credit Date and with respect to any
Investment Related Property hereafter acquired by such Grantor it shall comply
with the provisions of this Section 4.4.1(b) immediately upon acquiring rights
therein, in each case in form and substance reasonably satisfactory to the
Collateral Agent. With respect to any Investment Related Property that is
represented by a certificate or that is an “instrument” (other than any
Investment Related Property credited to a Securities Account) it shall cause
such certificate or instrument to be delivered to the Collateral Agent, indorsed
in blank by an “effective indorsement” (as defined in Section 8-107 of the UCC),
regardless of whether such certificate constitutes a “certificated security” for
purposes of the UCC. With respect to any Investment Related Property that is an
“uncertificated security” for purposes of the UCC (other than any
“uncertificated securities” credited to a Securities Account), it shall cause
the issuer of such uncertificated security to either (i) register the Collateral
Agent as the registered owner thereof on the books and records of the issuer or
(ii) execute an agreement substantially in the form of Exhibit B hereto,
pursuant to which such issuer agrees to comply with the Collateral Agent’s
instructions with respect to such uncertificated security without further
consent by such Grantor.
          (c) Voting and Distributions.
          (i) So long as no Event of Default shall have occurred and be
continuing:

  (1)   except as otherwise provided under the covenants and agreements relating
to investment related property in this Agreement or elsewhere herein or in the
Credit Agreement, each Grantor shall be entitled to exercise or refrain from
exercising any and all voting and other consensual rights pertaining to the
Investment Related Property or any part thereof for any purpose not inconsistent
with the terms of this Agreement or the Credit Agreement; provided, no Grantor
shall exercise or refrain from exercising any such right if the Collateral Agent
shall have notified such Grantor that, in the Collateral Agent’s reasonable
judgment, such action would have a Material Adverse Effect on the value of the
Investment Related Property or any part thereof; and provided further, such
Grantor shall give the Collateral Agent at least five (5) Business Days prior
written notice of the manner in which it intends to exercise, or the reasons for

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      refraining from exercising, any such right; it being understood, however,
that neither the voting by such Grantor of any Pledged Stock for, or such
Grantor’s consent to, the election of directors (or similar governing body) at a
regularly scheduled annual or other meeting of stockholders or with respect to
incidental matters at any such meeting, nor such Grantor’s consent to or
approval of any action otherwise permitted under this Agreement and the Credit
Agreement, shall be deemed prohibited by the terms of this Agreement or the
Credit Agreement within the meaning of this Section 4.4(c)(i)(1), and no notice
of any such voting or consent need be given to the Collateral Agent; and     (2)
  the Collateral Agent shall promptly execute and deliver (or cause to be
executed and delivered) to each Grantor all proxies, and other instruments as
such Grantor may from time to time reasonably request for the purpose of
enabling such Grantor to exercise the voting and other consensual rights when
and to the extent which it is entitled to exercise pursuant to clause (1) above;
    (3)   Upon the occurrence and during the continuation of an Event of
Default:

  (A)   all rights of each Grantor to exercise or refrain from exercising the
voting and other consensual rights which it would otherwise be entitled to
exercise pursuant hereto shall cease and all such rights shall thereupon become
vested in the Collateral Agent who shall thereupon have the sole right to
exercise such voting and other consensual rights; and     (B)   in order to
permit the Collateral Agent to exercise the voting and other consensual rights
which it may be entitled to exercise pursuant hereto and to receive all
dividends and other distributions which it may be entitled to receive hereunder:
(1) each Grantor shall promptly execute and deliver (or cause to be executed and
delivered) to the Collateral Agent all proxies, dividend payment orders and
other instruments as the Collateral Agent may from time to time reasonably
request and (2) each Grantor acknowledges that the Collateral Agent may utilize
the power of attorney set forth in Section 6.1.

          4.4.2 Pledged Equity Interests
          (a) Representations and Warranties. Each Grantor hereby represents and
warrants, on the Closing Date and on each Credit Date, that:
          (i) Schedule 4.4(A) (as such schedule may be amended or supplemented
from time to time) sets forth under the headings “Pledged Stock, “Pledged LLC
Interests,” “Pledged Partnership Interests” and “Pledged Trust Interests,”
respectively, all of the Pledged Stock, Pledged LLC Interests, Pledged
Partnership Interests and Pledged Trust Interests owned by any Grantor and such
Pledged Equity Interests constitute the percentage of issued and outstanding
shares of stock, percentage of membership interests, percentage of partnership
interests or percentage of beneficial interest of the respective issuers thereof
indicated on such Schedule;

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          (ii) except as set forth on Schedule 4.4(B), it has not acquired any
equity interests of another entity or substantially all the assets of another
entity within the past five (5) years;
          (iii) it is the record and beneficial owner of the Pledged Equity
Interests free of all Liens, rights or claims of other Persons other than
Permitted Liens and 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 Pledged Equity Interests;
          (iv) without limiting the generality of Section 4.1(a)(v), subject to
restrictions and limitations in the Credit Documents or under applicable law, 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 or desirable in connection with the creation,
perfection or first priority status of the security interest of the Collateral
Agent in any Pledged Equity Interests or the exercise by the Collateral Agent of
the voting or other rights provided for in this Agreement or the exercise of
remedies in respect thereof;
          (v) none of the Pledged LLC Interests nor 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; and
          (vi) except as otherwise set forth on Schedule 4.4(C), all of the
Pledged LLC Interests and Pledged Partnership Interests are or represent
interests in issuers that have opted to be treated as securities under the
uniform commercial code of any jurisdiction.
          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees
that:
          (i) other than as permitted or not prohibited under the Credit
Agreement, without the prior written consent of the Collateral Agent (such
consent not to be unreasonably withheld or delayed), it shall not vote to enable
or take any other action to: (a) amend or terminate any partnership agreement,
limited liability company agreement, certificate of incorporation, by-laws or
other organizational documents in any way that materially changes the rights of
such Grantor with respect to any Investment Related Property or adversely
affects the validity, perfection or priority of the Collateral Agent’s security
interest, (b) permit any issuer of any Pledged Equity Interest to issue any
additional stock, partnership interests, limited liability company interests or
other equity interests of any nature or to issue securities convertible into or
granting the right of purchase or exchange for any stock or other equity
interest of any nature of such issuer, (c) other than as permitted or not
prohibited under the Credit Agreement, permit any issuer of any Pledged Equity
Interest to dispose of all or a material portion of their assets, (d) waive any
default under or breach of any terms of organizational document relating to the
issuer of any Pledged Equity Interest or the terms of any Pledged Debt, or
(e) 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

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action in violation of the foregoing in this clause (e), such Grantor shall
promptly notify the Collateral Agent in writing of any such election or action
and, in such event, shall take all steps necessary or advisable to establish the
Collateral Agent’s “control” thereof;
          (ii) it shall comply with all of its obligations under any partnership
agreement or limited liability company agreement relating to Pledged Partnership
Interests or Pledged LLC Interests and shall enforce all of its rights with
respect to any Investment Related Property;
          (iii) except as permitted or not prohibited by the Credit Agreement,
without the prior written consent of the Collateral Agent, it shall not permit
any issuer of any Pledged Equity Interest to merge or consolidate unless
(i) such issuer creates a security interest that is perfected by a filed
financing statement (that is not effective solely under section 9-508 of the
UCC) in collateral in which such new debtor has or acquires rights, and (ii) all
the outstanding capital stock or other equity interests of the surviving or
resulting corporation, limited liability company, partnership or other entity
is, upon such merger or consolidation, pledged hereunder and no cash, securities
or other property is distributed in respect of the outstanding equity interests
of any other constituent Grantor; provided that if the surviving or resulting
Grantors upon any such merger or consolidation involving an issuer which is a
Controlled Foreign Corporation or Foreign Subsidiary, then such Grantor shall
only be required to pledge equity interests in accordance with Section 2.2; and
          (iv) each Grantor consents to the grant by each other Grantor of a
security interest in all Investment Related Property to the Collateral Agent
and, without limiting the foregoing, consents to the transfer of any Pledged
Partnership Interest and any Pledged LLC Interest to the Collateral Agent or its
nominee following the occurrence and during the continuance of an Event of
Default and to the substitution of the 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.
          4.4.3 Pledged Debt
          (a) Representations and Warranties. Each Grantor hereby represents and
warrants, on the Closing Date and each Credit Date, that:
          (i) Schedule 4.4 (as such schedule may be amended or supplemented from
time to time) sets forth under the heading “Pledged Debt” all of the Pledged
Debt owned by any Grantor and all of such Pledged Debt has been duly authorized,
authenticated or issued, and delivered and is the legal, valid and binding
obligation of the issuers thereof and is not in default and constitutes all of
the issued and outstanding inter-company Indebtedness;
          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees
that:
          (i) it shall notify the Collateral Agent of any default under any
Pledged Debt that has caused, either in any individual case or in the aggregate,
a Material Adverse Effect.
          4.4.4 Investment Accounts

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          (a) Representations and Warranties. Each Grantor hereby represents and
warrants, on the Closing Date and each Credit Date, that:
          (i) Schedule 4.4 hereto (as such schedule may be amended or
supplemented from time to time) sets forth under the headings “Securities
Accounts” and “Commodities Accounts,” respectively, all of the Securities
Accounts and Commodities Accounts in which each Grantor has an interest. Each
Grantor is the sole entitlement holder of each such Securities Account and
Commodity Account, and such Grantor has not consented to, and is not otherwise
aware of, any Person (other than the Collateral Agent pursuant hereto) having
“control” (within the meanings of Sections 8-106 and 9-106 of the UCC) over, or
any other interest in, any such Securities Account or Commodity Account or
securities or other property credited thereto;
          (ii) Schedule 4.4 hereto (as such schedule may be amended or
supplemented from time to time) sets forth under the headings “Deposit Accounts”
all of the Deposit Accounts in which each Grantor has an interest. Each Grantor
is the sole account holder of each such Deposit Account and such Grantor has not
consented to, and is not otherwise aware of, any Person (other than the
Collateral Agent pursuant hereto) having sole “control” (within the meanings of
Section 9-104 of the UCC) over, or any other interest in, any such Deposit
Account or any money or other property deposited therein; and
          (iii) Except as otherwise set forth on Schedule 5.21 to the Credit
Agreement with respect solely to the items of Investment Related Property
specified therein, each Grantor has taken all actions necessary or desirable,
including those specified in Section 4.4.4(c), to: (a) establish Collateral
Agent’s “control” (within the meanings of Sections 8-106 and 9-106 of the UCC)
over any portion of the Investment Related Property constituting Certificated
Securities, Uncertificated Securities, Securities Accounts, Securities
Entitlements or Commodities Accounts (each as defined in the UCC); (b) establish
the Collateral Agent’s “control” (within the meaning of Section 9-104 of the
UCC) over all Deposit Accounts; and (c) deliver all Instruments to the
Collateral Agent.
          (b) Covenant and Agreement. Each Grantor hereby covenants and agrees
with the Collateral Agent and each other Secured Party that it shall not close
or terminate any Investment Account without the prior consent of the Collateral
Agent (such consent not to be unreasonably withheld or delayed) and unless a
successor or replacement account has been established with the consent of the
Collateral Agent (such consent not to be unreasonably withheld or delayed) with
respect to which successor or replacement account a control agreement has been
entered into by the appropriate Grantor, Collateral Agent and securities
intermediary or depository institution at which such successor or replacement
account is to be maintained in accordance with the provisions of
Section 4.4.4(c).
          (c) Delivery and Control
          (i) With respect to any Investment Related Property consisting of
Securities Accounts or Securities Entitlements, it shall cause the securities
intermediary maintaining such Securities Account or Securities Entitlement to
enter into an agreement substantially in the form of Exhibit C hereto, or such
other agreement acceptable to Collateral Agent, pursuant to which it shall agree
to comply with the Collateral Agent’s “entitlement orders” without further
consent by such Grantor. With

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respect to any Investment Related Property that is a “Deposit Account,” it shall
cause the depositary institution maintaining such account to enter into an
agreement substantially in the form of Exhibit D hereto, or such other agreement
acceptable to Collateral Agent, pursuant to which the Collateral Agent shall
have sole “control” (within the meaning of Section 9-104 of the UCC) over such
Deposit Account. Each Grantor shall have entered into such control agreement or
agreements with respect to: (i) any Securities Accounts, Securities Entitlements
or Deposit Accounts that exist on the Credit Date, as of or prior to the Credit
Date and (ii) any Securities Accounts, Securities Entitlements or Deposit
Accounts that are created or acquired after the Credit Date, as of or prior to
the deposit or transfer of any such Securities Entitlements or funds, whether
constituting moneys or investments, into such Securities Accounts or Deposit
Accounts.
In addition to the foregoing, if any issuer of any Investment Related Property
is located in a jurisdiction outside of the United States, each Grantor shall
take such additional actions, including, without limitation, causing the issuer
to register the pledge on its books and records or making such filings or
recordings, in each case as may be necessary or advisable, under the laws of
such issuer’s jurisdiction to insure the validity, perfection and priority of
the security interest of the Collateral Agent. Upon the occurrence and during
the continuance of an Event of Default, the Collateral Agent shall have the
right, without notice to any Grantor, to transfer all or any portion of the
Investment Related Property to its name or the name of its nominee or agent. In
addition, the Collateral Agent shall have the right at any time, without notice
to any Grantor, to exchange any certificates or instruments representing any
Investment Related Property for certificates or instruments of smaller or larger
denominations.
     4.5 Material Contracts.
          (a) Representations and Warranties. Each Grantor hereby represents and
warrants, on the Closing Date and on each Credit Date, that:
          (i) Schedule 4.5 (as such schedule may be amended or supplemented from
time to time) sets forth all of the Material Contracts to which such Grantor has
rights;
          (ii) the Material Contracts, true and complete copies (including any
amendments or supplements thereof) of which have been furnished or made readily
available to the Collateral Agent, have, to the knowledge of the relevant
Grantor, been duly authorized, executed and delivered by all parties thereto,
are in full force and effect and are binding upon and enforceable against each
relevant Grantor (except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or
similar laws affecting the enforcement of creditors’ rights generally and by
general equitable principles (whether enforcement is sought by proceedings in
equity or at law)) and all parties thereto in accordance with their respective
terms. There exists no material default under any Material Contract by any party
thereto and neither such Grantor, nor to its best knowledge, any other Person
party thereto is likely to become in default thereunder and no Person party
thereto has any defenses, counterclaims or right of set-off with respect to any
Material Contract. Upon the occurrence of a Default, each applicable Grantor
shall use its commercially reasonably efforts to obtain an executed consent to
the assignment of any Material Contract from each Person party to a Material
Contract (other than any Grantor) and

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deliver such consent to the Collateral Agent pursuant to this Agreement if such
consent is required pursuant to such Material Contract.
          (iii) except as provided in clause (ii) above, no Material Contract
prohibits assignment or requires consent of or notice to any Person in
connection with the assignment to the Collateral Agent hereunder, except such as
has been given or made or is currently sought pursuant to Section 4.5 (b)(vii)
hereof.
          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees
that:
          (i) in addition to any rights under the Section of this Agreement
relating to Receivables, the Collateral Agent may at any time notify, or require
any Grantor to so notify, the counterparty on any Material Contract of the
security interest of the Collateral Agent therein. In addition, after the
occurrence and during the continuance of an Event of Default, the Collateral
Agent may upon written notice to the applicable Grantor, notify, or require any
Grantor to notify, the counterparty to make all payments under the Material
Contracts directly to the Collateral Agent;
          (ii) each Grantor shall deliver promptly to the Collateral Agent a
copy of each material demand, notice or document received by it relating in any
way to any Material Contract that would reasonably be expected to have a
Material Adverse Effect;
          (iii) each Grantor shall deliver promptly to the Collateral Agent,
after (1) any Material Contract of such Grantor is terminated or amended in a
manner that is materially adverse to such Grantor or (2) any new Material
Contract is entered into by such Grantor, notice thereof as required by
Section 5.3 of the Credit Agreement;
          (iv) it shall perform in all material respects all of its obligations
with respect to the Material Contracts;
          (v) it shall promptly and diligently exercise each material right
(except the right of termination without the consent of the Collateral Agent,
such consent not to be unreasonably withheld or delayed) it may have under any
Material Contract, any Supporting Obligation or Collateral Support, in each
case, at its own expense, and in connection with such collections and exercise,
such Grantor shall take such action as such Grantor or the Collateral Agent may
deem necessary or advisable;
          (vi) it shall use its best efforts to keep in full force and effect
any Supporting Obligation or Collateral Support relating to any Material
Contract; and
          (vii) upon the occurrence and during the continuance of an Event of
Default, each Grantor shall, promptly, with respect to any Non-Assignable
Contract in effect on the date hereof, request in writing the consent of the
counterparty or counterparties to the Non-Assignable Contract pursuant to the
terms of such Non-Assignable Contract or applicable law to the assignment or
granting of a security interest in such Non-Assignable Contract to Secured Party
and use its best efforts to obtain such consent as soon as practicable
thereafter.
     4.6 Letter of Credit Rights.

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          (a) Representations and Warranties. Each Grantor hereby represents and
warrants, on the Closing Date and on each Credit Date, that:
          (i) all material letters of credit to which such Grantor has rights
are listed on Schedule 4.6 (as such schedule may be amended or supplemented from
time to time) hereto; and
          (ii) it has obtained the consent of each issuer of any material letter
of credit to the assignment of the proceeds of the letter of credit to the
Collateral Agent.
          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees
that with respect to any material letter of credit hereafter arising it shall
obtain the consent of the issuer thereof to the assignment of the proceeds of
the letter of credit to the Collateral Agent and shall deliver to the Collateral
Agent a completed Pledge Supplement, substantially in the form of Exhibit A
attached hereto, together with all Supplements to Schedules thereto.
     4.7 Intellectual Property.
          (a) Representations and Warranties. Except as disclosed in
Schedule 4.7(H) (as such schedule may be amended or supplemented from time to
time), each Grantor hereby represents and warrants, on the Closing Date and on
each Credit Date, that:
          (i) Schedule 4.7 (as such schedule may be amended or supplemented from
time to time) sets forth a true and complete list of (i) all United States,
state and foreign registrations of and applications for Patents, Trademarks, and
Copyrights owned by each Grantor and (ii) all Patent Licenses, Trademark
Licenses, Trade Secret Licenses and Copyright Licenses material to the business
of such Grantor;
          (ii) it is the sole and exclusive owner of the entire right, title,
and interest in and to all Intellectual Property listed with reference to such
Grantor on Schedule 4.7(A), (C) and (E) (as each such schedule may be amended or
supplemented from time to time), and owns or has the valid right to use all
other Intellectual Property used in or necessary to conduct its business, free
and clear of all Liens, claims, encumbrances and licenses, except for Permitted
Liens and the licenses set forth on Schedule 4.7(B), (D), (F) and (G) (as each
may be amended or supplemented from time to time);
          (iii) to the best of such Grantor’s knowledge, all Intellectual
Property owned by such Grantor is subsisting and has not been adjudged invalid
or unenforceable, in whole or in part, and such Grantor has performed all acts
and has paid all renewal, maintenance, and other fees and taxes required to
maintain each and every registration and application of Copyrights, Patents and
Trademarks owned by such Grantor in full force and effect;
          (iv) to the best of such Grantor’s knowledge, all Intellectual
Property owned by such Grantor is valid and enforceable and no holding,
decision, or judgment has been rendered in any action or proceeding before any
court or administrative authority challenging the validity of such Grantor’s
right to register, or such Grantor’s rights to own or use, any Intellectual
Property and no such action or proceeding is pending or, to the best of such
Grantor’s knowledge, threatened;

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          (v) all registrations and applications for Copyrights, Patents and
Trademarks owned by such Grantor are standing in the name of such Grantor, and
none of the Trademarks, Patents, Copyrights or Trade Secrets has been licensed
by any Grantor to any Affiliate or third party, except as disclosed in
Schedule 4.7(B), (D), (F), or (G) (as each may be amended or supplemented from
time to time);
          (vi) each Grantor has been using appropriate statutory notice of
registration in connection with its use of registered Trademarks material to the
business of such Grantor, proper marking practices in connection with the use of
Patents material to the business of such Grantor, and appropriate notice of
copyright in connection with the publication of Copyrights material to the
business of such Grantor;
          (vii) each Grantor uses adequate standards of quality in the
manufacture, distribution, and sale of all products sold and in the provision of
all services rendered under or in connection with all Trademark Collateral and
has taken all commercially reasonable action necessary to insure that all
licensees of the Trademark Collateral owned by such Grantor use such adequate
standards of quality;
          (viii) to the best of such Grantor’s knowledge, the conduct of such
Grantor’s business does not infringe upon or otherwise violate any trademark,
patent, copyright, trade secret or other intellectual property right owned or
controlled by a third party and no claim has been made that the use of any
Intellectual Property owned by such Grantor violates the asserted rights of any
third party;
          (ix) to the best of such Grantor’s knowledge, no third party is
infringing upon or otherwise violating any rights in any Intellectual Property
owned by such Grantor;
          (x) no settlement or consents, covenants not to sue, nonassertion
assurances, or releases have been entered into by such Grantor or bind such
Grantor that adversely affect Grantor’s rights to own or use any Intellectual
Property; and
          (xi) such Grantor has not made a previous assignment, sale, transfer
or agreement constituting a present or future assignment, sale, transfer or
agreement of any Intellectual Property that has not been terminated or released.
There is no effective financing statement or other document or instrument now
executed, or on file or recorded in any public office, granting a security
interest in or otherwise encumbering any part of the Intellectual Property,
other than in favor of the Collateral Agent.
          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees
as follows:
          (i) it shall not do any act or omit to do any act whereby any of the
Intellectual Property owned by such Grantor which is material to the business of
Grantor may lapse, or become abandoned, dedicated to the public, or
unenforceable, or which would adversely affect the validity, grant, or
enforceability of the security interest granted therein;
          (ii) it shall not, with respect to any Trademarks which are owned by
such Grantor and material to the business of such Grantor, cease the use of any
of such Trademarks or fail to maintain the level of the quality of products sold
and services

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rendered under any of such Trademark at a level at least substantially
consistent with the quality of such products and services as of the date hereof,
and such Grantor shall take all commercially reasonable steps necessary to
insure that licensees of such Trademarks use such consistent standards of
quality;
          (iii) it shall, within thirty (30) days of the creation or acquisition
of any Copyrightable work which is material to the business of such Grantor,
apply to register the Copyright in the United States Copyright Office;
          (iv) it shall promptly notify the Collateral Agent if it knows or has
reason to know that any item of the Intellectual Property that is material to
the business of such Grantor is likely to become (a) abandoned or dedicated to
the public or placed in the public domain, (b) invalid or unenforceable, or
(c) subject to any adverse determination or development (including the
institution of proceedings) in any action or proceeding in the United States
Patent and Trademark Office, the United States Copyright Office, any state
registry, any foreign counterpart of the foregoing, or any court;
          (v) it shall take all reasonable steps in the United States Patent and
Trademark Office, the United States Copyright Office, any state registry or any
foreign counterpart of the foregoing, to pursue any application and maintain any
registration of each Trademark, Patent, and Copyright owned by any Grantor and
material to its business which is now or shall become included in the
Intellectual Property Collateral including, but not limited to, those items on
Schedule 4.7(A), (C) and (E) (as each may be amended or supplemented from time
to time);
          (vi) in the event that any Intellectual Property owned by or
exclusively licensed to such Grantor is infringed, misappropriated, or diluted
by a third party in any material respect, such Grantor shall promptly take all
commercially reasonable actions to stop such infringement, misappropriation, or
dilution and protect its rights in such Intellectual Property including, but not
limited to, the initiation of a suit for injunctive relief and to recover
damages;
          (vii) it shall promptly (but in no event more than thirty (30) days
after any Grantor obtains knowledge thereof) report to the Collateral Agent
(i) the filing of any application to register any Intellectual Property with the
United States Patent and Trademark Office, the United States Copyright Office,
or any state registry or foreign counterpart of the foregoing (whether such
application is filed by such Grantor or through any agent, employee, licensee,
or designee thereof) and (ii) the registration of any Intellectual Property by
any such office, in each case by executing and delivering to the Collateral
Agent a completed Pledge Supplement, substantially in the form of Exhibit A
attached hereto, together with all Supplements to Schedules thereto;
          (viii) it shall, promptly upon the reasonable request of the
Collateral Agent, execute and deliver to the Collateral Agent any document
required to acknowledge, confirm, register, record, or perfect the Collateral
Agent’s interest in any part of the Intellectual Property Collateral, whether
now owned or hereafter acquired;
          (ix) except with the prior consent of the Collateral Agent or as
permitted under the Credit Agreement, each Grantor shall not execute, and there
will not be on file in any public office, any financing statement or other
document or instruments,

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except financing statements or other documents or instruments filed or to be
filed in favor of the Collateral Agent and each Grantor shall not sell, assign,
transfer, license, grant any option, or create or suffer to exist any Lien upon
or with respect to the Intellectual Property, except for the Lien created by and
under this Agreement and the other Credit Documents;
          (x) it shall hereafter use best efforts so as not to permit the
inclusion in any contract to which it hereafter becomes a party of any provision
that could or might in any way materially impair or prevent the creation of a
security interest in, or the assignment of, such Grantor’s rights and interests
in any property included within the definitions of any Intellectual Property
acquired under such contracts;
          (xi) it shall take all steps reasonably necessary to protect the
secrecy of all Trade Secrets material to the business of such Grantor,
including, without limitation, entering into confidentiality agreements with
employees and labeling and restricting access to secret information and
documents;
          (xii) it shall use proper statutory notice in connection with its use
of any Intellectual Property owned by such Grantor; and
          (xiii) it shall continue to collect, at its own expense, all amounts
due or to become due to such Grantor in respect of the Intellectual Property or
any portion thereof. In connection with such collections, each Grantor may take
(and, at the Collateral Agent’s reasonable direction, shall take) such action as
such Grantor or the Collateral Agent may deem reasonably necessary or advisable
to enforce collection of such amounts. Notwithstanding the foregoing, the
Collateral Agent shall have the right at any time, to notify, or require any
Grantor to notify, any obligors with respect to any such amounts of the
existence of the security interest created hereby.
     4.8 Commercial Tort Claims
          (a) Representations and Warranties. Each Grantor hereby represents and
warrants, on the Closing Date and on each Credit Date, that Schedule 4.8 (as
such schedule may be amended or supplemented from time to time) sets forth all
Commercial Tort Claims of each Grantor in excess of $250,000 individually or
$500,000 in the aggregate; and
          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees
that with respect to any Commercial Tort Claim in excess of $250,000
individually or $500,000 in the aggregate hereafter arising it shall deliver to
the Collateral Agent a completed Pledge Supplement, substantially in the form of
Exhibit A attached hereto, together with all Supplements to Schedules thereto,
identifying such new Commercial Tort Claims.

SECTION 5.   ACCESS; RIGHT OF INSPECTION AND FURTHER ASSURANCES; ADDITIONAL
GRANTORS.

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     5.1 Access; Right of Inspection. Each Grantor will comply with Section 5.11
of the Credit Agreement. The Collateral Agent and its representatives shall at
all times have the right to enter any premises of each Grantor and inspect any
property of each Grantor where any of the Collateral of such Grantor granted
pursuant to this Agreement is located for the purpose of inspecting the same,
observing its use or otherwise protecting its interests therein.
     5.2 Further Assurances.
          (a) Each Grantor agrees that from time to time, at the expense of such
Grantor, that it shall promptly execute and deliver all further instruments and
documents, and take all further action, that may be necessary, or that the
Collateral Agent may reasonably request, in order to create and/or maintain the
validity, perfection or priority (to the extent provided herein and in the
Credit Agreement) of and protect any security interest granted hereby or to
enable the Collateral Agent to exercise and enforce its rights and remedies
hereunder with respect to any Collateral. Without limiting the generality of the
foregoing, each Grantor shall:
          (i) file such financing or continuation statements, or amendments
thereto, and execute and deliver such other agreements, instruments,
endorsements, powers of attorney or notices, as may be necessary, or as the
Collateral Agent may reasonably request, in order to perfect and preserve the
security interests granted or purported to be granted hereby;
          (ii) take all actions necessary to ensure the recordation of
appropriate evidence of the liens and security interest granted hereunder in the
Intellectual Property with any intellectual property registry in which said
Intellectual Property is registered or in which an application for registration
is pending including, without limitation, the United States Patent and Trademark
Office, the United States Copyright Office, the various Secretaries of State,
and the foreign counterparts of any of the foregoing;
          (iii) at any reasonable time, upon prior written notice and upon
request by the Collateral Agent and subject to Sections 5.11 and 9.2 of the
Credit Agreement, assemble the Collateral and allow inspection of the Collateral
by the Collateral Agent, or persons designated by the Collateral Agent; and
          (iv) at the Collateral Agent’s request, appear in and defend any
action or proceeding that may affect such Grantor’s title to or the Collateral
Agent’s security interest in all or any part of the Collateral.
          (b) Each Grantor hereby authorizes the Collateral Agent to file a
Record or Records, including, without limitation, financing or continuation
statements, and amendments thereto, in any jurisdictions and with any filing
offices as the Collateral Agent may reasonably determine, in its sole
discretion, are necessary or advisable to perfect the security interest granted
to the Collateral Agent herein. Such financing statements may describe the
Collateral in the same manner as described herein or may contain an indication
or description of collateral that describes such property in any other manner as
the Collateral Agent may determine, in its sole discretion, is necessary,
advisable or prudent to ensure the perfection of the security interest in the
Collateral granted to the Collateral Agent herein, including, without
limitation, describing such property as “all assets” or “all personal property,
whether now owned or hereafter acquired.” Each Grantor shall furnish to the
Collateral Agent from time to time statements and schedules further

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identifying and describing the Collateral and such other reports in connection
with the Collateral as the Collateral Agent may reasonably request, all in
reasonable detail.
          (c) Each Grantor hereby authorizes the Collateral Agent to modify this
Agreement after obtaining such Grantor’s approval of or signature to such
modification by amending Schedule 4.7 (as such schedule may be amended or
supplemented from time to time) to include reference to any right, title or
interest in any existing Intellectual Property or any Intellectual Property
acquired or developed by any Grantor after the execution hereof or to delete any
reference to any right, title or interest in any Intellectual Property in which
any Grantor no longer has or claims any right, title or interest.
     5.3 Additional Grantors. From time to time subsequent to the date hereof,
and pursuant to Section 5.13 of the Credit Agreement, additional Persons may
become parties hereto as additional Grantors (each, an “Additional Grantor"), by
executing a Counterpart Agreement. Upon delivery of any such counterpart
agreement to the Collateral Agent, notice of which is hereby waived by Grantors,
each Additional Grantor shall be a Grantor and shall be as fully a party hereto
as if Additional Grantor were an original signatory hereto. Each Grantor
expressly agrees that its obligations arising hereunder shall not be affected or
diminished by the addition or release of any other Grantor hereunder, nor by any
election of Collateral Agent not to cause any Subsidiary of Company to become an
Additional Grantor hereunder. This Agreement shall be fully effective as to any
Grantor that is or becomes a party hereto regardless of whether any other Person
becomes or fails to become or ceases to be a Grantor hereunder.
SECTION 6. COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT.
     6.1 Power of Attorney. Each Grantor hereby irrevocably appoints the
Collateral Agent (such appointment being coupled with an interest) as such
Grantor’s attorney-in-fact, with full authority in the place and stead of such
Grantor and in the name of such Grantor, the Collateral Agent or otherwise, from
time to time in the Collateral Agent’s discretion to take any action and to
execute any instrument that the Collateral Agent may deem reasonably necessary
or advisable to accomplish the purposes of this Agreement, including, without
limitation, the following:
          (a) upon the occurrence and during the continuance of any Event of
Default, to obtain and adjust insurance required to be maintained by such
Grantor or paid to the Collateral Agent pursuant to the Credit Agreement;
          (b) upon the occurrence and during the continuance of any Event of
Default, to ask for, demand, collect, sue for, recover, compound, receive and
give acquittance and receipts for moneys due and to become due under or in
respect of any of the Collateral;
          (c) upon the occurrence and during the continuance of any Event of
Default, to receive, endorse and collect any drafts or other instruments,
documents and chattel paper in connection with clause (b) above;
          (d) upon the occurrence and during the continuance of any Event of
Default, to file any claims or take any action or institute any proceedings that
the Collateral Agent may deem necessary or desirable for the collection of any
of the Collateral or otherwise to enforce the rights of the Collateral Agent
with respect to any of the Collateral;

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          (e) to prepare and file any UCC financing statements against such
Grantor as debtor;
          (f) to prepare, sign, and file for recordation in any intellectual
property registry, appropriate evidence of the lien and security interest
granted herein in the Intellectual Property in the name of such Grantor as
debtor;
          (g) to take or cause to be taken all actions necessary to perform or
comply or cause performance or compliance with the terms of this Agreement,
including, without limitation, access to pay or discharge taxes or Liens (other
than Permitted Liens) levied or placed upon or threatened against the
Collateral, the legality or validity thereof and the amounts necessary to
discharge the same to be determined by the Collateral Agent in its sole
discretion, any such payments made by the Collateral Agent to become obligations
of such Grantor to the Collateral Agent, due and payable immediately without
demand; and
          (h) upon the occurrence and during the continuance of an Event of
Default to sell, transfer, pledge, make any agreement with respect to or
otherwise deal with any of the Collateral as fully and completely as though the
Collateral Agent were the absolute owner thereof for all purposes, and to do, at
the Collateral Agent’s option and such Grantor’s expense, at any time or from
time to time, all acts and things that the Collateral Agent deems reasonably
necessary to protect, preserve or realize upon the Collateral and the Collateral
Agent’s security interest therein in order to effect the intent of this
Agreement, all as fully and effectively as such Grantor might do.
     6.2 No Duty on the Part of Collateral Agent or Secured Parties. The powers
conferred on the Collateral Agent hereunder are solely to protect the interests
of the Secured Parties in the Collateral and shall not impose any duty upon the
Collateral Agent or any Secured Party to exercise any such powers. The
Collateral Agent and the Secured Parties shall be accountable only for amounts
that they actually receive as a result of the exercise of such powers, and
neither they nor any of their officers, directors, employees or agents shall be
responsible to any Grantor for any act or failure to act hereunder, except for
their own gross negligence or willful misconduct.
SECTION 7. REMEDIES.
     7.1 Generally.
          (a) If any Event of Default shall have occurred and be continuing, the
Collateral Agent may exercise in respect of the Collateral, in addition to all
other rights and remedies provided for herein or otherwise available to it at
law or in equity, all the rights and remedies of the Collateral Agent on default
under the UCC (whether or not the UCC applies to the affected Collateral) to
collect, enforce or satisfy any Secured Obligations then owing, whether by
acceleration or otherwise, and also may pursue any of the following separately,
successively or simultaneously:
          (i) require any Grantor to, and each Grantor hereby agrees that it
shall at its expense and promptly upon request of the Collateral Agent
forthwith, assemble all or part of the Collateral as directed by the Collateral
Agent and make it available to the Collateral Agent at a place to be designated
by the Collateral Agent that is reasonably convenient to both parties;

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          (ii) enter onto the property where any Collateral is located and take
possession thereof with or without judicial process;
          (iii) prior to the disposition of the Collateral, store, process,
repair or recondition the Collateral or otherwise prepare the Collateral for
disposition in any manner to the extent the Collateral Agent deems appropriate;
and
          (iv) without notice except as specified below or under the UCC, sell,
assign, lease, license (on an exclusive or nonexclusive basis) or otherwise
dispose of the Collateral or any part thereof in one or more parcels at public
or private sale, at any of the Collateral Agent’s offices or elsewhere, for
cash, on credit or for future delivery, at such time or times and at such price
or prices and upon such other terms as the Collateral Agent may deem
commercially reasonable.
          (b) The Collateral Agent or any Secured Party may be the purchaser of
any or all of the Collateral at any public or private (to the extent to the
portion of the Collateral being privately sold is of a kind that is customarily
sold on a recognized market or the subject of widely distributed standard price
quotations) sale in accordance with the UCC and the Collateral Agent, as
collateral agent for and representative of the Secured Parties, shall be
entitled, for the purpose of bidding and making settlement or payment of the
purchase price for all or any portion of the Collateral sold at any such sale
made in accordance with the UCC, to use and apply any of the Secured Obligations
as a credit on account of the purchase price for any Collateral payable by the
Collateral Agent at such sale. Each purchaser at any such sale shall hold the
property sold absolutely free from any claim or right on the part of any
Grantor, and each Grantor hereby waives (to the extent permitted by applicable
law and in accordance with the UCC) 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. Each Grantor agrees that,
to the extent notice of sale shall be required by law, at least ten (10) days
notice to such Grantor of the time and place of any public sale or the time
after which any private sale is to be made shall constitute reasonable
notification. The Collateral Agent shall not be obligated to make any sale of
Collateral regardless of notice of sale having been given. The Collateral Agent
may adjourn any public or private sale from time to time by announcement at the
time and place fixed therefor, and such sale may, without further notice, be
made at the time and place to which it was so adjourned. Each Grantor agrees
that it would not be commercially unreasonable for the Collateral Agent to
dispose of the Collateral or any portion thereof by using Internet sites that
provide for the auction of assets of the types included in the Collateral or
that have the reasonable capability of doing so, or that match buyers and
sellers of assets. Each Grantor hereby waives any claims against the Collateral
Agent arising by reason of the fact that the price at which any Collateral may
have been sold at such a private sale was less than the price which might have
been obtained at a public sale, even if the Collateral Agent accepts the first
offer received and does not offer such Collateral to more than one offeree. If
the proceeds of any sale or other disposition of the Collateral are insufficient
to pay all the Secured Obligations, Grantors shall be liable for the deficiency
and the fees of any attorneys employed by the Collateral Agent to collect such
deficiency. Each Grantor further agrees that a breach of any of the covenants
contained in this Section will cause irreparable injury to the Collateral Agent,
that the Collateral Agent has no adequate remedy at law in respect of such
breach and, as a consequence, that each and every covenant contained in this
Section shall be specifically enforceable against such Grantor, and such Grantor
hereby waives and agrees not to assert any defenses against an action for
specific performance of such covenants except for a defense that no default has
occurred giving rise to the Secured Obligations becoming due and payable prior
to their stated maturities. Nothing in this Section shall in any way alter the
rights of the Collateral Agent hereunder.

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          (c) The Collateral Agent may sell the Collateral without giving any
warranties as to the Collateral. The Collateral Agent may specifically disclaim
or modify 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.
          (d) The Collateral Agent shall have no obligation to marshal any of
the Collateral.
     7.2 Application of Proceeds. Except as expressly provided elsewhere in this
Agreement, following the occurrence and during the continuance of an Event of
Default or during the exercise of remedies available to the Collateral Agent,
all proceeds received by the Collateral Agent in respect of any sale, any
collection from, or other realization upon all or any part of the Collateral
shall be applied in full or in part by the Collateral Agent against, the Secured
Obligations in the following order of priority: first, to the payment of all
costs and expenses of such sale, collection or other realization, including
reasonable compensation to the Collateral Agent and its agents and counsel, and
all other reasonable expenses, liabilities and advances made or incurred by the
Collateral Agent in connection therewith, and all amounts for which the
Collateral Agent is entitled to indemnification hereunder (in its capacity as
the Collateral Agent and not as a Lender) and all advances made by the
Collateral Agent hereunder for the account of the applicable Grantor, and to the
payment of all costs and expenses paid or incurred by the Collateral Agent in
connection with the exercise of any right or remedy hereunder or under the
Credit Agreement, all in accordance with the terms hereof or thereof; second, to
the extent of any excess of such proceeds, to the payment of all other Secured
Obligations for the ratable benefit of the Secured Parties; and third, to the
extent of any excess of such proceeds, to the payment to or upon the order of
such Grantor or to whosoever may be lawfully entitled to receive the same or as
a court of competent jurisdiction may direct.
     7.3 Sales on Credit. If Collateral Agent sells any of the Collateral upon
credit, Grantor will be credited only with payments actually made by purchaser
and received by Collateral Agent and applied to indebtedness of the purchaser.
In the event the purchaser fails to pay for the Collateral, Collateral Agent may
resell the Collateral and Grantor shall be credited with proceeds of the sale.
     7.4 Deposit Accounts.
     If any Event of Default shall have occurred and be continuing, the
Collateral Agent may apply the balance from any Deposit Account or instruct the
bank at which any Deposit Account is maintained to pay the balance of any
Deposit Account to or for the benefit of the Collateral Agent.
     7.5 Investment Related Property.
     Each Grantor recognizes that, by reason of certain prohibitions contained
in the Securities Act and applicable state securities laws, the 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

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Securities Act) and, notwithstanding such circumstances, each Grantor agrees
that any such private sale shall be deemed to have been made in a commercially
reasonable manner and that the 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. If the Collateral Agent determines to
exercise its right to sell any or all of the Investment Related Property, upon
written request, each Grantor shall and shall cause each issuer of any Pledged
Stock to be sold hereunder, each partnership and each limited liability company
from time to time to furnish to the Collateral Agent all such information as the
Collateral Agent may 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 the Collateral Agent in exempt transactions under
the Securities Act and the rules and regulations of the Securities and Exchange
Commission thereunder, as the same are from time to time in effect.
     7.6 Intellectual Property.
          (a) Anything contained herein to the contrary notwithstanding, upon
the occurrence and during the continuation of an Event of Default:
          (i) the Collateral Agent shall have the right (but not the obligation)
to bring suit or otherwise commence any action or proceeding in the name of any
Grantor, the Collateral Agent or otherwise, in the Collateral Agent’s sole
discretion, to enforce any Intellectual Property, in which event such Grantor
shall, at the request of the Collateral Agent, do any and all lawful acts and
execute any and all documents required by the Collateral Agent in aid of such
enforcement and such Grantor shall promptly, upon demand, reimburse and
indemnify the Collateral Agent as provided in Section 10 hereof in connection
with the exercise of its rights under this Section, and, to the extent that the
Collateral Agent shall elect not to bring suit to enforce any Intellectual
Property as provided in this Section, each Grantor agrees to use all reasonable
measures, whether by action, suit, proceeding or otherwise, to prevent the
infringement or other violation of any of such Grantor’s rights in the
Intellectual Property material to the business of such Grantor by others and for
that purpose agrees to diligently maintain any action, suit or proceeding
against any Person so infringing as shall be necessary to prevent such
infringement or violation;
          (ii) upon written demand from the Collateral Agent, each Grantor shall
grant, assign, convey or otherwise transfer to the Collateral Agent or such
Collateral Agent’s designee all of such Grantor’s right, title and interest in
and to the Intellectual Property and shall execute and deliver to the Collateral
Agent such documents as are necessary or appropriate to carry out the intent and
purposes of this Agreement;
          (iii) each Grantor agrees that such an assignment and/or recording
shall be applied to reduce the Secured Obligations outstanding only to the
extent that the Collateral Agent (or any Secured Party) receives cash proceeds
in respect of the sale of, or other realization upon, the Intellectual Property;
          (iv) within five (5) Business Days after written notice from the
Collateral Agent, each Grantor shall make available to the Collateral Agent, to
the extent within such Grantor’s power and authority and applicable law, such
personnel in such

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Grantor’s employ on the date of such Event of Default as the Collateral Agent
may reasonably designate, by name, title or job responsibility, to permit such
Grantor to continue, directly or indirectly, to produce, advertise and sell the
products and services sold or delivered by such Grantor under or in connection
with the Trademarks, Trademark Licenses, such persons to be available to perform
their prior functions on the Collateral Agent’s behalf and to be compensated by
the Collateral Agent at such Grantor’s expense on a per diem, pro-rata basis
consistent with the salary and benefit structure applicable to each as of the
date of such Event of Default; and
          (v) the Collateral Agent shall have the right to notify, or require
each Grantor to notify, any obligors with respect to amounts due or to become
due to such Grantor in respect of the Intellectual Property, of the existence of
the security interest created herein, to direct such obligors to make payment of
all such amounts directly to the Collateral Agent, and, upon such notification
and at the expense of such Grantor, to enforce collection of any such amounts
and to adjust, settle or compromise the amount or payment thereof, in the same
manner and to the same extent as such Grantor might have done;

  (1)   all amounts and proceeds (including checks and other instruments)
received by Grantor in respect of amounts due to such Grantor in respect of the
Collateral or any portion thereof shall be received in trust for the benefit of
the Collateral Agent hereunder, shall be segregated from other funds of such
Grantor and shall be forthwith paid over or delivered to the Collateral Agent in
the same form as so received (with any necessary endorsement) to be held as cash
Collateral and applied as provided by Section 7.7 hereof; and     (2)   Grantor
shall not adjust, settle or compromise the amount or payment of any such amount
or release wholly or partly any obligor with respect thereto or allow any credit
or discount thereon, except with the Collateral Agent’s consent.

          (b) If (i) an Event of Default shall have occurred and, by reason of
cure, waiver, modification, amendment or otherwise, is no longer be continuing,
(ii) no other Event of Default shall have occurred and be continuing, (iii) an
assignment or other transfer to the Collateral Agent of any rights, title and
interests in and to the Intellectual Property shall have been previously made
and shall have become absolute and effective, and (iv) the Secured Obligations
shall not have become immediately due and payable, upon the written request of
any Grantor, the Collateral Agent shall promptly execute and deliver to such
Grantor, at such Grantor’s sole cost and expense, such assignments or other
transfer as may be necessary to reassign to such Grantor any such rights, title
and interests as may have been assigned to the Collateral Agent as aforesaid,
subject to any disposition thereof that may have been made by the Collateral
Agent; provided, after giving effect to such reassignment, the Collateral
Agent’s security interest granted pursuant hereto, as well as all other rights
and remedies of the Collateral Agent granted hereunder, shall continue to be in
full force and effect; and provided further, the rights, title and interests so
reassigned shall be free and clear of any other Liens granted by or on behalf of
the Collateral Agent and the Secured Parties.
          (c) Solely for the purpose of enabling the Collateral Agent to
exercise rights and remedies under this Section 7 and at such time as the
Collateral Agent shall be lawfully entitled to exercise such rights and
remedies, each Grantor hereby grants to the Collateral Agent, to the extent it
has the right to do so, an irrevocable, nonexclusive license (exercisable
without payment of royalty or other compensation to such Grantor), subject, in
the case of Trademarks, to

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quality control and quality standards then in effect and inspection rights in
favor of such Grantor to avoid the risk of invalidation of said Trademarks, to
use, operate under, license, or sublicense any Intellectual Property now owned
or hereafter acquired by such Grantor, and wherever the same may be located.
     7.7 Cash Proceeds. In addition to the rights of the Collateral Agent
specified in Section 4.3 with respect to payments of Receivables, all proceeds
of any Collateral received by any Grantor consisting of cash, checks and other
non-cash items (collectively, “Cash Proceeds”) shall be held by such Grantor in
trust for the Collateral Agent, segregated from other funds of such Grantor, and
shall, forthwith upon receipt by such Grantor, unless otherwise provided
pursuant to Section 4.4(a)(ii), be turned over to the Collateral Agent in the
exact form received by such Grantor (duly indorsed by such Grantor to the
Collateral Agent, if required) and held by the Collateral Agent in the
Collateral Account. Any Cash Proceeds received by the Collateral Agent (whether
from a Grantor or otherwise): (i) if no Event of Default shall have occurred and
be continuing, shall be held by the Collateral Agent for the ratable benefit of
the Secured Parties, as collateral security for the Secured Obligations (whether
matured or unmatured) and (ii) if an Event of Default shall have occurred and be
continuing, may, in the sole discretion of the Collateral Agent, (A) be held by
the Collateral Agent for the ratable benefit of the Secured Parties, as
collateral security for the Secured Obligations (whether matured or unmatured)
and/or (B) then or at any time thereafter may be applied by the Collateral Agent
against the Secured Obligations then due and owing.
     7.8 Acknowledgement. Notwithstanding the foregoing, the Collateral Agent
and the Lenders expressly acknowledge and agree that any transfer of the Pledged
Equity Interests, or any exercise of control with respect thereto, is subject
to, and shall be effected solely in compliance with, applicable regulatory
requirements.
     Notwithstanding the foregoing or anything herein to the contrary, the
Collateral Agent, for itself and on behalf of the Secured Parties, and the
Lenders expressly acknowledge and agree that any exercise by the Collateral
Agent or a Secured Party of their rights and remedies hereunder, including any
transfer of the Pledged Equity Interests, or any exercise of control by the
Collateral Agent with respect thereto, is subject to, and shall be effected
solely in compliance with, applicable regulatory requirements.
SECTION 8. COLLATERAL AGENT.
     The Collateral Agent has been appointed to act as Collateral Agent
hereunder by Lenders and, by their acceptance of the benefits hereof, the other
Secured Parties. The Collateral Agent shall be obligated, and shall have the
right hereunder, to make demands, to give notices, to exercise or refrain from
exercising any rights, and to take or refrain from taking any action (including,
without limitation, the release or substitution of Collateral), solely in
accordance with this Agreement and the Credit Agreement; provided, the
Collateral Agent shall, after payment in full of all Obligations under the
Credit Agreement and the other Credit Documents, exercise, or refrain from
exercising, any remedies provided for herein in accordance with the instructions
of the holders of a majority of the aggregate notional amount (or, with respect
to any Hedge Agreement that has been terminated in accordance with its terms,
the amount then due and payable (exclusive of expenses and similar payments but
including any early termination payments then due) under such Hedge Agreement)
under all Hedge Agreements. In furtherance of the foregoing provisions of this
Section, each Secured Party, by its acceptance of the benefits hereof, agrees
that it shall have no right individually to realize upon any of the Collateral
hereunder, it being understood and agreed by such Secured Party that all rights
and remedies

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hereunder may be exercised solely by the Collateral Agent for the benefit of
Secured Parties in accordance with the terms of this Section. Collateral Agent
may resign at any time by giving thirty (30) days’ prior written notice thereof
to Lenders and the Grantors, and Collateral Agent may be removed at any time
with or without cause by an instrument or concurrent instruments in writing
delivered to the Grantors and Collateral Agent signed by the Requisite Lenders.
Upon any such notice of resignation or any such removal, Requisite Lenders shall
have the right, upon five (5) Business Days’ notice to the Administrative Agent,
to appoint a successor Collateral Agent. Upon the acceptance of any appointment
as Collateral Agent hereunder by a successor Collateral Agent, that successor
Collateral Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring or removed Collateral
Agent under this Agreement, and the retiring or removed Collateral Agent under
this Agreement shall promptly (i) transfer to such successor Collateral Agent
all sums, Securities and other items of Collateral held hereunder, together with
all records and other documents necessary or appropriate in connection with the
performance of the duties of the successor Collateral Agent under this
Agreement, and (ii) execute and deliver to such successor Collateral Agent or
otherwise authorize the filing of such amendments to financing statements, and
take such other actions, as may be necessary or appropriate in connection with
the assignment to such successor Collateral Agent of the security interests
created hereunder, whereupon such retiring or removed Collateral Agent shall be
discharged from its duties and obligations under this Agreement. After any
retiring or removed Collateral Agent’s resignation or removal hereunder as the
Collateral Agent, the provisions of this Agreement shall inure to its benefit as
to any actions taken or omitted to be taken by it under this Agreement while it
was the Collateral Agent hereunder.
SECTION 9. CONTINUING SECURITY INTEREST; TRANSFER OF LOANS.
     This Agreement shall create a continuing security interest in the
Collateral and shall remain in full force and effect until the payment in full
of all Secured Obligations, the cancellation or termination of the Commitments
and the cancellation or expiration of all outstanding Letters of Credit, be
binding upon each Grantor, its successors and assigns, and inure, together with
the rights and remedies of the Collateral Agent hereunder, to the benefit of the
Collateral Agent and its successors, transferees and assigns. Without limiting
the generality of the foregoing, but subject to the terms of the Credit
Agreement, any Lender may assign or otherwise transfer any Loans held by it to
any other Person, and such other Person shall thereupon become vested with all
the benefits in respect thereof granted to Lenders herein or otherwise. Upon the
payment in full of all Secured Obligations, the cancellation or termination of
the Commitments and the cancellation or expiration of all outstanding Letters of
Credit, the security interest granted hereby shall automatically terminate
hereunder and of record and all rights to the Collateral shall revert to
Grantors. Upon any such termination the Collateral Agent shall, at Grantors’
expense, execute and deliver to Grantors or otherwise authorize the filing of
such documents as Grantors shall reasonably request, including financing
statement amendments to evidence such termination. Upon any disposition of
property permitted or not prohibited by the Credit Agreement, the Liens granted
herein shall be deemed to be automatically released and such property shall
automatically revert to the applicable Grantor with no further action on the
part of any Person. The Collateral Agent shall, at Grantor’s expense, execute
and deliver or otherwise authorize the filing of such documents as Grantors
shall reasonably request, in form and substance reasonably satisfactory to the
Collateral Agent, including financing statement amendments to evidence such
release.
SECTION 10. STANDARD OF CARE; COLLATERAL AGENT MAY PERFORM.

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     The powers conferred on the Collateral Agent hereunder are solely to
protect its interest in the Collateral and shall not impose any duty upon it to
exercise any such powers. Except for the exercise of reasonable care in the
custody of any Collateral in its possession and the accounting for moneys
actually received by it hereunder, the Collateral Agent shall have no duty as to
any Collateral or as to the taking of any necessary steps to preserve rights
against prior parties or any other rights pertaining to any Collateral. The
Collateral Agent shall be deemed to have exercised reasonable care in the
custody and preservation of Collateral in its possession if such Collateral is
accorded treatment substantially equal to that which the Collateral Agent
accords its own property. Neither the Collateral Agent nor any of its directors,
officers, employees or agents shall be liable for failure to demand, collect or
realize upon all or any part of the Collateral or for any delay in doing so or
shall be under any obligation to sell or otherwise dispose of any Collateral
upon the request of any Grantor or otherwise. If any Grantor fails to perform
any agreement contained herein, the Collateral Agent may itself perform, or
cause performance of, such agreement, and the expenses of the Collateral Agent
incurred in connection therewith shall be payable by each Grantor under
Section 10.2 of the Credit Agreement.
SECTION 11. MISCELLANEOUS.
     Any notice required or permitted to be given under this Agreement shall be
given in accordance with Section 10.1 of the Credit Agreement. No failure or
delay on the part of the Collateral Agent in the exercise of any power, right or
privilege hereunder or under any other Credit Document shall impair such power,
right or privilege or be construed to be a waiver of any default or acquiescence
therein, nor shall any single or partial exercise of any such power, right or
privilege preclude other or further exercise thereof or of any other power,
right or privilege. All rights and remedies existing under this Agreement and
the other Credit Documents are cumulative to, and not exclusive of, any rights
or remedies otherwise available. In case any provision in or obligation under
this Agreement shall be invalid, illegal or unenforceable in any jurisdiction,
the validity, legality and enforceability of the remaining provisions or
obligations, or of such provision or obligation in any other jurisdiction, shall
not in any way be affected or impaired thereby. All covenants hereunder shall be
given independent effect so that if a particular action or condition is not
permitted by any of such covenants, the fact that it would be permitted by an
exception to, or would otherwise be within the limitations of, another covenant
shall not avoid the occurrence of a Default or an Event of Default if such
action is taken or condition exists. This Agreement shall be binding upon and
inure to the benefit of the Collateral Agent and Grantors and their respective
successors and assigns. No Grantor shall, without the prior written consent of
the Collateral Agent given in accordance with the Credit Agreement, assign any
right, duty or obligation hereunder. This Agreement and the other Credit
Documents embody the entire agreement and understanding between Grantors and the
Collateral Agent and supersede all prior agreements and understandings between
such parties relating to the subject matter hereof and thereof. Accordingly, the
Credit Documents may not be contradicted by evidence of prior, contemporaneous
or subsequent oral agreements of the parties. There are no unwritten oral
agreements between the parties. This Agreement may be executed in one or more
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and attached
to a single counterpart so that all signature pages are physically attached to
the same document.
     THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW

37

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YORK, WITHOUT REGARD TO ITS CONFLICTS OF LAW PROVISIONS (OTHER THAN SECTION
5-1401 AND SECTION 5-1402 OF THE NEW YORK GENERAL OBLIGATION LAWS).
          ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY GRANTOR ARISING OUT OF OR
RELATING HERETO OR ANY OTHER CREDIT DOCUMENT, OR ANY OF THE OBLIGATIONS, SHALL
BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE,
COUNTY AND CITY OF NEW YORK. BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH
GRANTOR, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY
(A) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND
VENUE OF SUCH COURTS; (B) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS; (C) AGREES
THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE
BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE APPLICABLE
GRANTOR AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 10.1 OF THE CREDIT
AGREEMENT; (D) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (C) ABOVE IS SUFFICIENT
TO CONFER PERSONAL JURISDICTION OVER THE APPLICABLE GRANTOR IN ANY SUCH
PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING
SERVICE IN EVERY RESPECT; AND (E) AGREES THAT THE COLLATERAL AGENT RETAINS THE
RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING
PROCEEDINGS AGAINST ANY GRANTOR IN THE COURTS OF ANY OTHER JURISDICTION.
          EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE
RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING
HEREUNDER OR UNDER ANY OF THE OTHER CREDIT DOCUMENTS OR ANY DEALINGS BETWEEN
THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THE
LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. THE SCOPE OF THIS WAIVER
IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN
ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING
CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND
STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL
INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED
ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO
RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS. EACH PARTY HERETO FURTHER
WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL
AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING
CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN
WAIVER SPECIFICALLY REFERRING TO THIS SECTION 11 AND EXECUTED BY EACH OF THE
PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THE OTHER CREDIT
DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE
HEREUNDER.

38

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IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO
A TRIAL BY THE COURT.

39

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

                  AMERIGROUP CORPORATION,         as Grantor    
 
           
 
  By:        
 
  Name:  
 
   
 
  Title:  
 
   
 
     
 
   
 
                PHP HOLDINGS, INC.,         as Grantor    
 
           
 
  By:        
 
  Name:  
 
   
 
  Title:  
 
   
 
     
 
   

[Signature Page to Pledge and Security Agreement]

 

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                  WACHOVIA BANK, NATIONAL ASSOCIATION,         as the Collateral
Agent    
 
           
 
  By:        
 
  Name:  
 
   
 
  Title:  
 
   
 
     
 
   

[Signature Page to Pledge and Security Agreement]

 

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SCHEDULE 4.1
TO PLEDGE AND SECURITY AGREEMENT
GENERAL INFORMATION

(A)   Full Legal Name, Type of Organization, Jurisdiction of Organization, Chief
Executive Office/Sole Place of Business (or Residence if Grantor is a Natural
Person) and Organizational Identification Number of each Grantor:

                              Chief Executive                 Office/Sole Place
                of Business (or                 Residence if     Full Legal  
Type of   Jurisdiction of   Grantor is a     Name   Organization   Organization
  Natural Person)   Organization I.D.#                

(B)   Other Names (including any Trade Name or Fictitious Business Name) under
which each Grantor has conducted business for the past five (5) years:

      Full Legal Name   Trade Name or Fictitious Business Name    

(C)   Changes in Name, Jurisdiction of Organization, Chief Executive Office or
Sole Place of Business (or Principal Residence if Grantor is a Natural Person)
and Corporate Structure within past five (5) years:

          Grantor   Date of Change   Description of Change        

(D)   Agreements pursuant to which any Grantor is found as debtor within past
five (5) years:

      Grantor   Description of Agreement    

(E)   Financing Statements:

      Grantor   Filing Jurisdiction(s)    

 SCHEDULE 4.1-1

 

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SCHEDULE 4.2
TO PLEDGE AND SECURITY AGREEMENT

      Grantor   Location of Equipment and Inventory      

 SCHEDULE 4.2-1

 

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SCHEDULE 4.4
TO PLEDGE AND SECURITY AGREEMENT
INVESTMENT RELATED PROPERTY

(A)   Pledged Stock:

                                                          Percentage            
                of                 Stock       No. of   Outstanding     Stock  
Class of   Certificated   Certificate       Pledged   Stock of the Grantor  
Issuer   Stock   (Y/N)   No.   Par Value   Stock   Stock Issuer                
                                           

          Pledged LLC Interests:

                                          Percentage of                    
Outstanding                     LLC Interests of     Limited               the
Limited     Liability   Certificated   Certificate No.   No. of Pledged  
Liability Grantor   Company   (Y/N)   (if any)   Units   Company                
                           

          Pledged Partnership Interests:

                              Type of           Percentage of        
Partnership           Outstanding         Interests (e.g.,           Partnership
        general or   Certificated   Certificate No.   Interests of the Grantor  
Partnership   limited)   (Y/N)   (if any)   Partnership                        
                   

          Pledged Trust Interests:

                                          Percentage of                    
Outstanding         Class of Trust   Certificated   Certificate No.   Trust
Interests Grantor   Trust   Interests   (Y/N)   (if any)   of the Trust        
                                   

          Pledged Debt:

                              Original   Outstanding                 Principal  
Principal         Grantor   Issuer   Amount   Balance   Issue Date   Maturity
Date
 
                   
 
                   

      EXHIBIT 4.4-1

 

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          Securities Account:

                  Share of Securities         Grantor   Intermediary   Account
Number   Account Name                            

          Commodities Accounts:

                  Name of Commodities         Grantor   Intermediary   Account
Number   Account Name                            

          Deposit Accounts:

              Grantor   Name of Depositary Bank   Account Number   Account Name
                           

(B)

                  Grantor   Date of Acquisition   Description of Acquisition    
               

(C)

          Name of Issuer of Pledged LLC Interest/Pledged Grantor   Partnership
Interest            

 EXHIBIT 4.4-2

 

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SCHEDULE 4.5
TO PLEDGE AND SECURITY AGREEMENT

      Grantor   Description of Material Contract      

SCHEDULE 4.5-1

 

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SCHEDULE 4.6
TO PLEDGE AND SECURITY AGREEMENT

      Grantor   Description of Letters of Credit      

 SCHEDULE 4.6-1

 

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SCHEDULE 4.7
TO PLEDGE AND SECURITY AGREEMENT
INTELLECTUAL PROPERTY

(A)   Copyrights   (B)   Copyright Licenses   (C)   Patents   (D)   Patent
Licenses   (E)   Trademarks   (F)   Trademark Licenses   (G)   Trade Secret
Licenses   (H)   Intellectual Property Exceptions

 SCHEDULE 4.7-1

 

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SCHEDULE 4.8
TO PLEDGE AND SECURITY AGREEMENT

      Grantor   Commercial Tort Claims      

 SCHEDULE 4.8-1

 

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EXHIBIT A
TO PLEDGE AND SECURITY AGREEMENT
PLEDGE SUPPLEMENT
     This PLEDGE SUPPLEMENT, dated [mm/dd/yy], is delivered by [NAME OF GRANTOR]
a [NAME OF STATE OF INCORPORATION] [Corporation] (the “Grantor”) pursuant to the
Pledge and Security Agreement, dated as of March [___], 2007 (as it may be from
time to time amended, restated, modified or supplemented, the “Security
Agreement”), among AMERIGROUP CORPORATION, the other Grantors named therein, and
WACHOVIA BANK, NATIONAL ASSOCIATION, as the Collateral Agent. Capitalized terms
used herein not otherwise defined herein shall have the meanings ascribed
thereto in the Security Agreement.
     Grantor hereby confirms the grant to the Collateral Agent set forth in the
Security Agreement of, and does hereby grant to the Collateral Agent, a security
interest in all of Grantor’s right, title and interest in and to all Collateral
to secure the Secured Obligations, in each case whether now or hereafter
existing or in which Grantor now has or hereafter acquires an interest and
wherever the same may be located. Grantor represents and warrants that the
attached Supplements to Schedules accurately and completely set forth all
additional information required pursuant to the Security Agreement and hereby
agrees that such Supplements to Schedules shall constitute part of the Schedules
to the Security Agreement.
     IN WITNESS WHEREOF, Grantor has caused this Pledge Supplement to be duly
executed and delivered by its duly authorized officer as of [mm/dd/yy].
[NAME OF GRANTOR]
By:                                        
Name:
Title:
 EXHIBIT A-1

 

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SUPPLEMENT TO SCHEDULE 4.1
TO PLEDGE AND SECURITY AGREEMENT
Additional Information:

(A)   Full Legal Name, Type of Organization, Jurisdiction of Organization, Chief
Executive Office/Sole Place of Business (or Residence if Grantor is a Natural
Person) and Organizational Identification Number of each Grantor:

                              Chief Executive                 Office/Sole Place
                of Business (or                 Residence if         Type of  
Jurisdiction of   Grantor is a   Organization Full Legal Name   Organization  
Organization   Natural Person)   I.D.#                  

(B)   Other Names (including any Trade Name or Fictitious Business Name) under
which each Grantor has conducted business for the past five (5) years:

      Full Legal Name   Trade Name or Fictitious Business Name
 
   

(C)   Changes in Name, Jurisdiction of Organization, Chief Executive Office or
Sole Place of Business (or Principal Residence if Grantor is a Natural Person)
and Corporate Structure within past five (5) years:

          Name of Grantor   Date of Change   Description of Change          

(D)   Agreements pursuant to which any Grantor is found as debtor within past
five (5) years:

      Name of Grantor   Description of Agreement      

(E)   Financing Statements:

      Name of Grantor   Filing Jurisdiction(s)      

 EXHIBIT A-2

 

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SUPPLEMENT TO SCHEDULE 4.2
TO PLEDGE AND SECURITY AGREEMENT
Additional Information:

      Name of Grantor   Location of Equipment and Inventory

 

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 EXHIBIT A-3
SUPPLEMENT TO SCHEDULE 4.4
TO PLEDGE AND SECURITY AGREEMENT
Additional Information:
(A)
Pledged Stock:
Pledged Partnership Interests:
Pledged LLC Interests:
Pledged Trust Interests:
Pledged Debt:
Securities Account:
Commodities Accounts:
Deposit Accounts:
(B)

          Name of Grantor   Date of Acquisition   Description of Acquisition    
     

(C)

          Name of Issuer of Pledged LLC Interest/Pledged Partnership Name of
Grantor   Interest      

 EXHIBIT A-4

 

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SUPPLEMENT TO SCHEDULE 4.5
TO PLEDGE AND SECURITY AGREEMENT
Additional Information:

      Name of Grantor   Description of Material Contract      

 EXHIBIT A-5

 

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SUPPLEMENT TO SCHEDULE 4.6
TO PLEDGE AND SECURITY AGREEMENT
Additional Information:

      Name of Grantor   Description of Letters of Credit      

 EXHIBIT A-6

 

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SUPPLEMENT TO SCHEDULE 4.7
TO PLEDGE AND SECURITY AGREEMENT
Additional Information:

(A)   Copyrights   (B)   Copyright Licenses   (C)   Patents   (D)   Patent
Licenses   (E)   Trademarks   (F)   Trademark Licenses   (G)   Trade Secret
Licenses   (H)   Intellectual Property Exceptions

 EXHIBIT A-7

 

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SUPPLEMENT TO SCHEDULE 4.8
TO PLEDGE AND SECURITY AGREEMENT
Additional Information:

      Name of Grantor   Commercial Tort Claims      

 EXHIBIT A-8

 

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EXHIBIT B
TO PLEDGE AND SECURITY AGREEMENT
UNCERTIFICATED SECURITIES CONTROL AGREEMENT
     This Uncertificated Securities Control Agreement dated as of
[                    ], 20[___] among [                    ] (the “Pledgor”),
WACHOVIA BANK, NATIONAL ASSOCIATION, as collateral agent for the Secured
Parties, (the “Collateral Agent”) and [                    ],
a[                    ][corporation] (the “Issuer”). Capitalized terms used but
not defined herein shall have the meaning assigned in the Pledge and Security
Agreement dated as of March [___], 2007, among the Pledgor, the other Grantors
party thereto and the Collateral Agent (the “Security Agreement”). All
references herein to the “UCC” shall mean the Uniform Commercial Code as in
effect in the State of New York.
     Section 1. Registered Ownership of Shares. The Issuer hereby confirms and
agrees that as of the date hereof the Pledgor is the registered owner of
[                     ] shares of the Issuer’s [common] stock (the “Pledged
Shares”) and the Issuer shall not change the registered owner of the Pledged
Shares without the prior written consent of the Collateral Agent.
     Section 2. Instructions. If at any time the Issuer shall receive
instructions originated by the Collateral Agent relating to the Pledged Shares,
the Issuer shall comply with such instructions without further consent by the
Pledgor or any other person.
     Section 3. Additional Representations and Warranties of the Issuer. The
Issuer hereby represents and warrants to the Collateral Agent:
     (a) It has not entered into, and until the termination of this agreement
will not enter into, any agreement with any other person relating the Pledged
Shares pursuant to which it has agreed to comply with instructions issued by
such other person; and
     (b) It has not entered into, and until the termination of this agreement
will not enter into, any agreement with the Pledgor or the Collateral Agent
purporting to limit or condition the obligation of the Issuer to comply with
Instructions as set forth in Section 2 hereof.
     (c) Except for the claims and interest of the Collateral Agent and of the
Pledgor in the Pledged Shares, the Issuer does not know of any claim to, or
interest in, the Pledged Shares. If any person asserts any lien, encumbrance or
adverse claim (including any writ, garnishment, judgment, warrant of attachment,
execution or similar process) against the Pledged Shares, the Issuer will
promptly notify the Collateral Agent and the Pledgor thereof.
     (d) This Uncertificated Securities Control Agreement is the valid and
legally binding obligation of the Issuer.
     Section 4. Choice of Law. This Agreement shall be governed by the laws of
the State of Delaware.
     Section 5. Conflict with Other Agreements. In the event of any conflict
between this Agreement (or any portion thereof) and any other agreement now
existing or hereafter entered into, the terms of this Agreement shall prevail.
No amendment or modification of this Agreement or waiver of any right hereunder
shall be binding on any party hereto unless it is in writing and is signed by
all of the parties hereto.
  EXHIBIT B-1

 

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     Section 6. Voting Rights. Until such time as the Collateral Agent shall
otherwise instruct the Issuer in writing, the Pledgor shall have the right to
vote the Pledged Shares.
     Section 7. Successors; Assignment. The terms of this Agreement shall be
binding upon, and shall inure to the benefit of, the parties hereto and their
respective corporate successors or heirs and personal representatives who obtain
such rights solely by operation of law. The Collateral Agent may assign its
rights hereunder only with the express written consent of the Issuer and by
sending written notice of such assignment to the Pledgor.
     Section 8. Indemnification of Issuer. The Pledgor and the Collateral Agent
hereby agree that (a) the Issuer is released from any and all liabilities to the
Pledgor and the Collateral Agent arising from the terms of this Agreement and
the compliance of the Issuer with the terms hereof, except to the extent that
such liabilities arise from the Issuer’s negligence, bad faith or willful
misconduct, and (b) the Pledgor, its successors and assigns shall at all times
indemnify and save harmless the Issuer from and against any and all claims,
actions and suits of others arising out of the terms of this Agreement or the
compliance of the Issuer with the terms hereof, except to the extent that such
arises from the Issuer’s negligence, and from and against any and all
liabilities, losses, damages, costs, charges, counsel fees and other expenses of
every nature and character arising by reason of the same, until the termination
of this Agreement.
     Section 9. Notices. Any notice, request or other communication required or
permitted to be given under this Agreement shall be in writing and deemed to
have been properly given when delivered in person, or when sent by telecopy or
other electronic means and electronic confirmation of error free receipt is
received or two (2) days after being sent by certified or registered United
States mail, return receipt requested, postage prepaid, addressed to the party
at the address set forth below.

     
Pledgor:
  [Name and Address of Pledgor]
 
  Attention: [                    ]
 
  Telecopier: [                    ]
 
   
Collateral Agent:
  Wachovia Bank, National Association
 
  [301 College Street
 
  Charlotte, North Carolina 28288-0737]
 
  Attention: [                    ]
 
  Telecopier: [                    ]
 
   
Issuer:
  [Insert Name and Address of Issuer]
 
  Attention: [                    ]
 
  Telecopier: [                    ]

     Any party may change its address for notices in the manner set forth above.
     Section 10. Termination. The obligations of the Issuer to the Collateral
Agent pursuant to this Control Agreement shall continue in effect until the
security interests of the Collateral Agent in the Pledged Shares have been
terminated pursuant to the terms of the Security Agreement and the Collateral
Agent has notified the Issuer of such termination in writing. The Collateral
Agent agrees to provide Notice of Termination in substantially the form of
Exhibit A hereto to the Issuer upon the request of the Pledgor on or after the
termination of the Collateral Agent’s security interest in the Pledged Shares
pursuant to the terms of the Security Agreement. The termination of this Control
Agreement shall not terminate the Pledged Shares or alter the
 EXHIBIT B-2

 

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obligations of the Issuer to the Pledgor pursuant to any other agreement with
respect to the Pledged Shares.
     Section 11. Counterparts. This Agreement may be executed in any number of
counterparts, all of which shall constitute one and the same instrument, and any
party hereto may execute this Agreement by signing and delivering one or more
counterparts.
[NAME OF PLEDGOR],
as Pledgor
By:                                                            
Name:
Title:
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Collateral Agent
By:                                                            
Name:
Title:
[NAME OF ISSUER],
as Issuer
By:                                                            
Name:
Title:
 EXHIBIT B-3

 

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Exhibit A
[Letterhead of Collateral Agent]
[Date]
[Name and Address of Issuer]
Attention: [                      ]
Re: Termination of Control Agreement
     You are hereby notified that the Uncertificated Securities Control
Agreement between you, [Name of Pledgor] (the “Pledgor”) and the undersigned (a
copy of which is attached) is terminated and you have no further obligations to
the undersigned pursuant to such Agreement. Notwithstanding any previous
instructions to you, you are hereby instructed to accept all future directions
with respect to Pledged Shares (as defined in the Uncertificated Control
Agreement) from the Pledgor. This notice terminates any obligations you may have
to the undersigned with respect to the Pledged Shares, however nothing contained
in this notice shall alter any obligations which you may otherwise owe to the
Pledgor pursuant to any other agreement.
     You are instructed to deliver a copy of this notice by facsimile
transmission to the Pledgor.
Very truly yours,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Collateral Agent
By:                                                            
Name:
Title:
 EXHIBIT B-A-1

 

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EXHIBIT C
TO PLEDGE AND SECURITY AGREEMENT
SECURITIES ACCOUNT CONTROL AGREEMENT
     This Securities Account Control Agreement dated as of
[                    ], 20[___] (this “Agreement”) among [                    ]
(the “Debtor”), WACHOVIA BANK, NATIONAL ASSOCIATION, as collateral agent for the
Secured Parties (the “Collateral Agent”) and [                    ] in its
capacity as a “securities intermediary” as defined in Section 8-102 of the UCC
(in such capacity, the “Securities Intermediary”). Capitalized terms used but
not defined herein shall have the meaning assigned thereto in the Pledge and
Security Agreement, dated as of March [___], 2007, among the Debtor, the other
Grantors party thereto and the Collateral Agent (as amended, restated,
supplemented or otherwise modified from time to time, the “Security Agreement”).
All references herein to the “UCC” shall mean the Uniform Commercial Code as in
effect in the State of New York.
     Section 1. Establishment of Securities Account. The Securities Intermediary
hereby confirms and agrees that:
     (a) The Securities Intermediary has established account number [IDENTIFY
ACCOUNT NUMBER] in the name “[IDENTIFY EXACT TITLE OF ACCOUNT]” (such account
and any successor account, the “Securities Account”) and the Securities
Intermediary shall not change the name or account number of the Securities
Account without the prior written consent of the Collateral Agent;
     (b) All securities or other property underlying any financial assets
credited to the Securities Account shall be registered in the name of the
Securities Intermediary, indorsed to the Securities Intermediary or in blank or
credited to another securities account maintained in the name of the Securities
Intermediary and in no case will any financial asset credited to the Securities
Account be registered in the name of the Debtor, payable to the order of the
Debtor or specially indorsed to the Debtor except to the extent the foregoing
have been specially indorsed to the Securities Intermediary or in blank;
     (c) All property delivered to the Securities Intermediary pursuant to the
Security Agreement will be promptly credited to the Securities Account; and
     (d) The Securities Account is a “securities account” within the meaning of
Section 8-501 of the UCC.
     Section 2. “Financial Assets” Election. The Securities Intermediary hereby
agrees that each item of property (including, without limitation, any investment
property, financial asset, security, instrument, general intangible or cash)
credited to the Securities Account shall be treated as a “financial asset”
within the meaning of Section 8-102(a)(9) of the UCC.
     Section 3. Control of the Securities Account. If at any time the Securities
Intermediary shall receive any order from the Collateral Agent directing
transfer or redemption of any financial asset relating to the Securities
Account, the Securities Intermediary shall comply with such entitlement order
without further consent by the Debtor or any other person. If the Debtor is
otherwise entitled to issue entitlement orders and such orders conflict with any
entitlement order issued by the Collateral Agent, the Securities Intermediary
shall follow the orders issued by the Collateral Agent.
 EXHIBIT C-1

 

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     Section 4. Subordination of Lien; Waiver of Set-Off. In the event that the
Securities Intermediary has or subsequently obtains by agreement, by operation
of law or otherwise a security interest in the Securities Account or any
security entitlement credited thereto, the Securities Intermediary hereby agrees
that such security interest shall be subordinate to the security interest of the
Collateral Agent. The financial assets and other items deposited to the
Securities Account will not be subject to deduction, set-off, banker’s lien, or
any other right in favor of any person other than the Collateral Agent (except
that the Securities Intermediary may set off (i) all amounts due to the
Securities Intermediary in respect of customary fees and expenses for the
routine maintenance and operation of the Securities Account and (ii) the face
amount of any checks which have been credited to such Securities Account but are
subsequently returned unpaid because of uncollected or insufficient funds).
     Section 5. Choice of Law. This Agreement and the Securities Account shall
each be governed by the laws of the State of New York. Regardless of any
provision in any other agreement, for purposes of the UCC, New York shall be
deemed to be the Securities Intermediary’s jurisdiction (within the meaning of
Section 8-110 of the UCC) and the Securities Account (as well as the securities
entitlements related thereto) shall be governed by the laws of the State of New
York.
     Section 6. Conflict with Other Agreements.
     (a) In the event of any conflict between this Agreement (or any portion
thereof) and any other agreement now existing or hereafter entered into, the
terms of this Agreement shall prevail;
     (b) No amendment or modification of this Agreement or waiver of any right
hereunder shall be binding on any party hereto unless it is in writing and is
signed by all of the parties hereto;
     (c) The Securities Intermediary hereby confirms and agrees that:
     (i) There are no other control agreements entered into between the
Securities Intermediary and the Debtor with respect to the Securities Account;
     (ii) It has not entered into, and until the termination of this Agreement,
will not enter into, any agreement with any other person relating to the
Securities Account and/or any financial assets credited thereto pursuant to
which it has agreed to comply with entitlement orders (as defined in
Section 8-102(a)(8) of the UCC) of such other person; and
     (iii) It has not entered into, and until the termination of this Agreement,
will not enter into, any agreement with the Debtor or the Collateral Agent
purporting to limit or condition the obligation of the Securities Intermediary
to comply with entitlement orders as set forth in Section 3 hereof.
     Section 7. Adverse Claims. Except for the claims and interest of the
Collateral Agent and of the Debtor in the Securities Account, the Securities
Intermediary does not know of any claim to, or interest in, the Securities
Account or in any “financial asset” (as defined in Section 8-102(a) of the UCC)
credited thereto. If any person asserts any lien, encumbrance or adverse claim
(including any writ, garnishment, judgment, warrant of attachment, execution or
similar
 EXHIBIT C-2

 

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process) against the Securities Account or in any financial asset carried
therein, the Securities Intermediary will promptly notify the Collateral Agent
and the Debtor thereof.
     Section 8. Maintenance of Securities Account. In addition to, and not in
lieu of, the obligation of the Securities Intermediary to honor entitlement
orders as agreed in Section 3 hereof, the Securities Intermediary agrees to
maintain the Securities Account as follows:
     (a) Notice of Sole Control. If at any time the Collateral Agent delivers to
the Securities Intermediary a Notice of Sole Control in substantially the form
set forth in Exhibit A hereto, the Securities Intermediary agrees that after
receipt of such notice, it will take all instruction with respect to the
Securities Account solely from the Collateral Agent.
     (b) Voting Rights. Until such time as the Securities Intermediary receives
a Notice of Sole Control pursuant to subsection (a) of this Section 8, the
Debtor shall direct the Securities Intermediary with respect to the voting of
any financial assets credited to the Securities Account.
     (c) Permitted Investments. Until such time as the Securities Intermediary
receives a Notice of Sole Control signed by the Collateral Agent, the Debtor
shall direct the Securities Intermediary with respect to the selection of
investments to be made for the Securities Account; provided, however, that the
Securities Intermediary shall not honor any instruction to purchase any
investments other than investments of a type described on Exhibit B hereto.
     (d) Statements and Confirmations. The Securities Intermediary will promptly
send copies of all statements, confirmations and other correspondence concerning
the Securities Account and/or any financial assets credited thereto
simultaneously to each of the Debtor and the Collateral Agent at the address for
each set forth in Section 12 of this Agreement.
     (e) Tax Reporting. All items of income, gain, expense and loss recognized
in the Securities Account shall be reported to the Internal Revenue Service and
all state and local taxing authorities under the name and taxpayer
identification number of the Debtor.
     Section 9. Representations, Warranties and Covenants of the Securities
Intermediary. The Securities Intermediary hereby makes the following
representations, warranties and covenants:
     (a) The Securities Account has been established as set forth in Section 1
above and such Securities Account will be maintained in the manner set forth
herein until termination of this Agreement; and
     (b) This Agreement is the valid and legally binding obligation of the
Securities Intermediary.
     Section 10 Indemnification of Securities Intermediary. The Debtor and the
Collateral Agent hereby agree that (a) the Securities Intermediary is released
from any and all liabilities to the Debtor and the Collateral Agent arising from
the terms of this Agreement and the compliance of the Securities Intermediary
with the terms hereof, except to the extent that such liabilities arise from the
Securities Intermediary’s negligence and (b) the Debtor, its successors and
assigns shall at all times indemnify and save harmless the Securities
Intermediary from and against any and all claims, actions and suits of others
arising out of the terms of this Agreement or the compliance of the Securities
Intermediary with the terms hereof, except to the extent that such arises from
the Securities Intermediary’s negligence, bad faith or willful conduct, and from
and against any and
 EXHIBIT C-3

 

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all liabilities, losses, damages, costs, charges, counsel fees and other
expenses of every nature and character arising by reason of the same, until the
termination of this Agreement.
     Section 11. Successors; Assignment. The terms of this Agreement shall be
binding upon, and shall inure to the benefit of, the parties hereto and their
respective corporate successors or heirs and personal representatives who obtain
such rights solely by operation of law. The Collateral Agent may assign its
rights hereunder only with the express written consent of the Securities
Intermediary and by sending written notice of such assignment to the Debtor.
     Section 12. Notices. Any notice, request or other communication required or
permitted to be given under this Agreement shall be in writing and deemed to
have been properly given when delivered in person, or when sent by telecopy or
other electronic means and electronic confirmation of error free receipt is
received or two (2) days after being sent by certified or registered United
States mail, return receipt requested, postage prepaid, addressed to the party
at the address set forth below.

     
Debtor:
  [Name and Address of Debtor]
 
  Attention: [                    ]
 
  Telecopier: [                    ]
 
   
Collateral Agent:
  Wachovia Bank, National Association
 
  [301 South College Street
 
  Charlotte, North Carolina 28288-0737]
 
  Attention: [                    ]
 
  Telecopier: [                    ]
 
   
Securities Intermediary:
  [Name and Address of Securities Intermediary]
 
  Attention: [                    ]
 
  Telecopier: [                    ]

     Any party may change its address for notices in the manner set forth above.
     Section 13. Termination. The obligations of the Securities Intermediary to
the Collateral Agent pursuant to this Agreement shall continue in effect until
the security interest of the Collateral Agent in the Securities Account has been
terminated pursuant to the terms of the Security Agreement and the Collateral
Agent has notified the Securities Intermediary of such termination in writing.
The Collateral Agent agrees to provide Notice of Termination in substantially
the form of Exhibit C hereto to the Securities Intermediary upon the request of
the Debtor on or after the termination of the Collateral Agent’s security
interest in the Securities Account pursuant to the terms of the Security
Agreement. The termination of this Agreement shall not terminate the Securities
Account or alter the obligations of the Securities Intermediary to the Debtor
pursuant to any other agreement with respect to the Securities Account.
     Section 14. Counterparts. This Agreement may be executed in any number of
counterparts, all of which shall constitute one and the same instrument, and any
party hereto may execute this Agreement by signing and delivering one or more
counterparts.
 EXHIBIT C-4

 

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     IN WITNESS WHEREOF, the parties hereto have caused this Securities Account
Control Agreement to be executed as of the date first above written by their
respective officers thereunto duly authorized.
[DEBTOR],
as Debtor
By:                                                            
Name:
Title:
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Collateral Agent
By:                                                            
Name:
Title:
[NAME OF SECURITIES INTERMEDIARY],
as Securities Intermediary
By:                                                            
Name:
Title:
 EXHIBIT C-5

 

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EXHIBIT A
TO SECURITIES ACCOUNT CONTROL AGREEMENT
[Letterhead of Collateral Agent]
[Date]
[Name and Address of Securities Intermediary]
Attention: [___]
Re: Notice of Sole Control
Ladies and Gentlemen:
     As referenced in the Securities Account Control Agreement dated as of
[                    ], 20[___] among [Name of Debtor] (the “Debtor”), you and
the undersigned (a copy of which is attached), we hereby give you notice of our
sole control over securities account number [                    ] (the
“Securities Account”) and all financial assets credited thereto. You are hereby
instructed not to accept any direction, instructions or entitlement orders with
respect to the Securities Account or the financial assets credited thereto from
any person other than the undersigned, unless otherwise ordered by a court of
competent jurisdiction.
     You are instructed to deliver a copy of this notice by facsimile
transmission to the Debtor.
Very truly yours,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Collateral Agent
By:                                                            
Name:
Title:
cc: [Name of Debtor]
 EXHIBIT C-A-1

 

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EXHIBIT B
TO SECURITIES ACCOUNT CONTROL AGREEMENT
Permitted Investments
[TO COME]
 EXHIBIT C-B-1

 

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EXHIBIT C
TO SECURITIES ACCOUNT CONTROL AGREEMENT
[Letterhead of the Collateral Agent]
[Date]
[Name and Address of Securities Intermediary]
Attention: [                    ]
Re: Termination of Securities Account Control Agreement
     You are hereby notified that the Securities Account Control Agreement dated
as of [                    ], 20[___] among you, [Name of Debtor] (the “Debtor”)
and the undersigned (a copy of which is attached) is terminated and you have no
further obligations to the undersigned pursuant to such Agreement.
Notwithstanding any previous instructions to you, you are hereby instructed to
accept all future directions with respect to account number(s)
[                    ] from the Debtor. This notice terminates any obligations
you may have to the undersigned with respect to such account, however nothing
contained in this notice shall alter any obligations which you may otherwise owe
to the Debtor pursuant to any other agreement.
     You are instructed to deliver a copy of this notice by facsimile
transmission to the Debtor.
Very truly yours,
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Collateral Agent
By:                                                            
Name:
Title:
 EXHIBIT C-C-1

 

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EXHIBIT D
TO PLEDGE AND SECURITY AGREEMENT
DEPOSIT ACCOUNT CONTROL AGREEMENT
(With Future Notification)
This DEPOSIT ACCOUNT CONTROL AGREEMENT (“Agreement”) is made and entered into as
of this 26th day of March 2007 by and among WACHOVIA BANK, NATIONAL ASSOCIATION
as depositary bank (the “Bank”), the Bank’s depositary customer, AMERIGROUP
CORPORATION, a Delaware corporation (the “Company”), and WACHOVIA BANK, NATIONAL
ASSOCIATION, in its individual capacity and as Collateral Agent for certain
other secured lending institutions (the “Collateral Agent”).
Statement of Facts
The Bank acknowledges that, as of the date hereof, it maintains in the name of
the Company the deposit account(s) identified on Exhibit A attached hereto and
made a part hereof (each an “Account” and, collectively, the “Accounts”). One or
more of the Accounts may be served by one or more lockboxes operated by the
Bank, which lockboxes (if any) also are listed on Exhibit A (each a “Lockbox”
and, collectively, the “Lockboxes”). The Account(s) and any Lockbox(es) are
governed by the terms and conditions of the Company’s commercial deposit account
agreement published by the Bank from time to time and, with respect to any
Lockbox, also may be governed by a lockbox service description between the Bank
and the Company (collectively, with all applicable services descriptions and/or
agreements, the “Deposit Agreement”). The Company has received a true and
correct copy of the Deposit Agreement on or prior to the date hereof.
The Company and the Collateral Agent hereby confirm that they have entered into
a certain Pledge and Security Agreement dated as of March 26, 2007 with the
other parties thereto (the “Security Agreement”). The Company hereby confirms to
the Bank that the Company has granted to the Collateral Agent for the benefit of
the Secured Parties (as defined in the Security Agreement) a security interest
in the following (collectively, the “Account Collateral”): (a) the Account(s),
(b) the Lockbox(es) and (c) the Items Collateral. The term “Items Collateral”
means, collectively, all checks, drafts, instruments, cash and other items at
any time received in any Lockbox or for deposit in any Account (subject to
specific Lockbox instructions in effect for processing items), wire transfers of
funds, automated clearing house (“ACH”) entries, credits from merchant card
transactions and other electronic funds transfers or other funds deposited in,
credited to, or held for deposit in or credit to, any Account.
The parties desire to enter into this Agreement in order to set forth their
relative rights and duties with respect to the Account Collateral. In
consideration of the mutual covenants herein as well as other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
1. Control of the Accounts
(a) The Statement of Facts is incorporated herein by reference. The Bank
represents that it is a “bank”. The Company and the Bank acknowledge that each
Account is a “deposit account”. Each party to this Agreement acknowledges that
this Agreement is an “authenticated record” and that the arrangements
established under this Agreement constitute “control” of each Account. Each of
these terms is used in this Agreement as defined in Article 9 of the Uniform
Commercial Code as adopted by the State of New York (the “New York UCC”).

EXHIBIT D-1

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(b) The Company represents and warrants to the Collateral Agent that Exhibit A
contains a complete and accurate list of all Accounts and Lockboxes maintained
by the Company with the Bank and subject to this Agreement. Nothing in this
Agreement shall impose upon the Bank any duty to monitor or assure the Company’s
compliance with this Section 1(b).
(c) The Bank confirms that, as of the date of this Agreement, the Company and
the Bank have not entered into any agreement (other than the Deposit Agreement)
with any person pursuant to which the Bank is obligated to comply with
instructions from such person as to the disposition of funds in any Account or
of Items Collateral. The Company covenants for the benefit of the Collateral
Agent and the Lenders that the Company shall not close or instruct the Bank to
close any Account or Lockbox without the prior written consent of the Collateral
Agent. During the term of this Agreement the Bank will not enter into any
agreement with any person other than the Collateral Agent pursuant to which the
Bank will be obligated to comply with instructions from such person as to the
disposition of funds in any Account or of Items Collateral.
(d) The Company authorizes and directs the Bank to comply, and the Bank agrees
to comply, with all instructions given by the Collateral Agent in accordance
with this Agreement and permissible under the Deposit Agreement, including
directing the disposition of funds in any Account or as to any other matter
relating to any Account or other Account Collateral, without further consent by
the Company. The Collateral Agent’s right to give instructions to the Bank
regarding any Account Collateral also shall include the right to give “stop
payment orders” to the Bank for any item presented to the Bank against any
Account even if it results in dishonor of the item presented against the
Account.
(e) The Collateral Agent authorizes and instructs the Bank to (i) permit the
Company to have access to and disposition over the Account(s) and Account
Collateral and to otherwise deal with same as provided in the Deposit Agreement
and (ii) act upon the instructions that the Bank shall receive from the Company
concerning the Lockbox and the Account Collateral until the implementation by
the Bank of the written instruction delivered by the Collateral Agent to the
Bank in the text of Exhibit B attached hereto and made a part hereof, completed
accordingly (the “Notice”), in accordance with the provisions of Section 7 of
this Agreement. The Bank shall not be obligated to honor or accept any document
purported to be the Notice unless it: (A) shall be in the text of Exhibit B and
completed accordingly; and (B) shall be accompanied by a copy of this Agreement
as fully executed; and (C) shall have been delivered to the Bank’s Designated
Officer in accordance with the provisions of Section 7.
(f) Until delivery of the Notice by the Collateral Agent to the Bank in
accordance with the provisions of this Agreement, the Collateral Agent shall not
give any instruction to the Bank and, until the Bank shall receive and implement
the Notice as provided in Section 7, the Bank shall not (and shall not be
required by the provisions of this Agreement to) honor and follow any
instruction the Bank may receive from the Collateral Agent with regard to the
Account(s) and the Account Collateral. Upon the implementation of the Notice by
the Bank, the Bank shall not permit any officer, agent or other representative
of the Company or its affiliates to direct the disposition of funds in any
Account, withdraw any amount from any Account or otherwise exercise any
authority or power with respect to any Lockbox, Account or Account Collateral.
Upon implementation of the Notice by the Bank, all collected and available funds
in any Account shall only be withdrawn or transferred based on instructions
given by the Collateral Agent in accordance with this Agreement.
(g) Federal Reserve Regulations and Operating Circulars, ACH or other clearing
house rules and other applicable law (including, without limitation, the Uniform
Commercial Code as adopted by the State in which the respective Account
identified on Exhibit A is located (hereinafter, the “Applicable UCC”)) and the
Deposit Agreement shall also apply to the Collateral Agent’s exercise of control
over the Account(s)

EXHIBIT D-2

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and to the Account Collateral and the performance by the Bank of its obligations
under this Agreement. Each of the Company and the Collateral Agent authorizes
and instructs the Bank to supply the Company’s or the Collateral Agent’s
endorsement, as appropriate, to any Items Collateral that the Bank shall receive
for deposit to any Account.
2. Statements and Other Information If so requested of the Bank by the
Collateral Agent in writing, the Bank will send to the Collateral Agent (in a
manner consistent with the Bank’s standard practices) at the Collateral Agent’s
address specified in Section 7, copies of all Account statements (but not
canceled checks) that the Bank is required to send to the Company under the
Deposit Agreement. The Bank also shall provide to each of the Company and the
Collateral Agent when requested (as a service to the Company under the Deposit
Agreement) copies of Account statements and other deposit account information,
including Account balances, by telephone and by computer communication, to the
extent practicable when requested by the Company or by the Collateral Agent. The
Company consents to the Bank’s release of such Account information to the
Collateral Agent. The Bank’s liability for its failure to comply with this
Section 2 shall not exceed its cost of providing such information.
3. Setoff; Returned Items and Charges
(a) The Bank will not exercise any security interest, lien, right of setoff,
deduction, recoupment or banker’s lien or any other interest in or against any
Account or any other Account Collateral, and the Bank hereby subordinates to the
Collateral Agent any such security interest, lien or right which the Bank may
have against any Account or other Account Collateral. The security interest of
and the subordination by the Bank in the preceding sentence shall not include,
and the preceding sentence shall not apply to, any security interest that the
Bank may have as a collecting bank in any Items Collateral as provided in
Article 4 of the Applicable UCC. Notwithstanding the preceding text of this
paragraph, the Collateral Agent and the Company agree that the Bank at all times
(including following commencement of any bankruptcy or insolvency proceeding by
or against the Company) may set off and charge against any Account (regardless
of any agreement by the Company to compensate the Bank by means of balances in
the Account) all of the following as permitted by the Deposit Agreement
(collectively, the “Permitted Debits”): (i) the face amount of each Returned
Item (hereinafter defined), (ii) the Bank’s usual and customary service charges
and fees, (iii) the Bank’s usual and customary account maintenance fees,
(iv) the Bank’s usual and customary funds transfer fees, (v) out-of-pocket fees
and expenses (including attorneys’ reasonable fees) incurred by the Bank
(including those in connection with its negotiation, administration or
enforcement of this Agreement), and (vi) adjustments or corrections of posting
or encoding errors; whether any Permitted Debit shall have accrued or been
incurred before or after the date of this Agreement. “Returned Item” means any
(i) Items Collateral deposited into or credited to an Account before or after
the date of this Agreement and returned unpaid or otherwise uncollected or
subject to an adjustment entry, whether for insufficient funds or any other
reason, and without regard to the timeliness of such return or adjustment or the
occurrence or timeliness of any other party’s notice of nonpayment or
adjustment; (ii) Items Collateral subject to a claim against the Bank for breach
of transfer, presentment, encoding, retention or other warranty under Federal
Reserve Regulations or Operating Circulars, ACH or other clearing house rules,
or applicable law (including, without limitation, Articles 3, 4 and 4A of the
Applicable UCC); and (iii) demand for chargeback in connection with a merchant
card transaction. For avoidance of doubt, the Bank’s rights under this Section
3(a) or any rights that the Bank may have under the provisions of the Deposit
Agreement shall not permit the Bank to set off and charge as a Permitted Debit
any obligation of the Company to the Bank in connection with any other deposit
account that the Company may have with the Bank or other agreement between the
Company and the Bank; Permitted Debits shall be solely those relating to the
Account(s) and the Account Collateral.

EXHIBIT D-3

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(b) If (i) the Bank were unable to set off or charge any Permitted Debit against
any Account because of insufficient funds in the Account, or (ii) the Bank in
good faith were to believe that any legal process or applicable law prohibited
such setoff or charge against any Account, or (iii) the Account were closed,
then: (A) the Bank may charge such Permitted Debits to and set off same against
any other Account (and other deposit account(s) of the Company with the Bank
that are not subject to this Agreement, if any); and (B) if there were
insufficient funds in the Account(s) (and other deposit account(s) of the
Company with the Bank, if any) against which to charge or set off such Permitted
Debits, then the Bank shall demand (unless the Bank shall believe in good faith
that any legal process or applicable law prohibits such demand) that the Company
pay, and the Company shall pay, to the Bank promptly upon the Company’s receipt
of the Bank’s written demand therefor, the full amount of all unpaid Permitted
Debits.
(c) If (i) there were insufficient funds in the Account(s) (and other deposit
account(s) of the Company with the Bank, if any) against which the Bank could
charge or set off Permitted Debits and the Company shall have failed to pay the
Bank the full amount of unpaid Permitted Debits as described in paragraph (b) of
this Section 3, and (ii) the Bank shall have received and implemented the Notice
as provided herein, then the Bank may demand that the Collateral Agent pay, and
the Collateral Agent shall pay, to the Bank within five (5) business days of the
Collateral Agent’s receipt of the Bank’s written demand therefor, the full
amount of unpaid Permitted Debits; provided, however, (A) as to unpaid Permitted
Debits that are the Bank’s service charges or fees described in clauses (ii),
(iii) and (iv) of Section 3(a) above, the Collateral Agent shall be required to
pay to the Bank only those service charges or fees attributable to any Account
that shall have been incurred in connection with such Account on or after the
date of this Agreement and on or before the date of termination of this
Agreement, and (B) as to any unpaid Permitted Debit that is a Returned Item that
shall have been deposited to an Account prior to the implementation of the
Notice and returned to the Bank as un-collectable on or after the implementation
of the Notice, the obligation of the Collateral Agent to reimburse the Bank for
such Returned Item shall not exceed the aggregate amount of funds in the
Account(s) at the time the Notice shall have been implemented by the Bank and
funds thereafter deposited or credited to the Account(s) by the Bank on or
before the date of termination of this Agreement.
(d) The Company shall reimburse the Collateral Agent for, and hold the
Collateral Agent harmless from, all costs, expenses, claims and liabilities
under this Agreement, including any moneys that the Collateral Agent shall have
paid to the Bank under the provisions of this Agreement. At its option, the
Collateral Agent may charge any loan account of the Company for any such
amounts. Nothing in this paragraph shall limit any liability or obligation of
the Collateral Agent to the Bank under this Agreement.
4. Exculpation of Bank
(a) At all times the Bank shall be entitled to rely upon any communication it
receives from the Collateral Agent or the Company in connection with this
Agreement or that the Bank shall believe in good faith to be a communication
received from the Collateral Agent or the Company in connection with this
Agreement, and the Bank shall have no obligation to investigate or verify the
authenticity or correctness of any such communication. The Bank shall have no
liability to the Company or the Collateral Agent for (i) honoring or following
any instruction the Bank shall receive from (or shall believe in good faith to
be from) the Collateral Agent in accordance with this Agreement, (ii) honoring
or following any instruction the Bank shall receive from (or shall believe in
good faith to be from) the Company in accordance with this Agreement and the
Deposit Agreement prior to the implementation of the Notice by the Bank, and
(iii) upon implementation of the Notice, not honoring or following any
instruction the Bank shall receive from (or shall believe in good faith to be
from) the Company in accordance with this Agreement or the Deposit Agreement.
The Bank shall not be responsible for the validity, priority or enforceability
of the Collateral

EXHIBIT D-4

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Agent’s security interest in any Account Collateral, nor shall the Bank be
responsible for enforcement of any agreement between the Company and the
Collateral Agent.
(b) The Bank shall be responsible only for the actual loss that a court having
jurisdiction over the Account(s) shall have determined had been incurred by the
Company or the Collateral Agent and had been caused by the Bank’s gross
negligence or willful misconduct in its performance of its obligations under
this Agreement. The Bank shall have no liability to any party for failure of, or
delay in, its performance under this Agreement resulting from any “act of God”,
war or terrorism, fire, other catastrophe or force majeure, electrical or
computer or telecommunications failure, any event beyond the control of the
Bank, or fraud committed by any third party. Nothing in this Agreement shall
create any agency, fiduciary, joint venture or partnership relationship between
the Bank and the Company or between the Bank and the Collateral Agent. Except as
shall be specifically required under this Agreement or the Deposit Agreement or
applicable law, the Bank shall have no duty whatsoever to the Company in
connection with the subject matter of this Agreement. Except as shall be
specifically required under this Agreement or applicable law, the Bank shall
have no duty whatsoever to the Collateral Agent in connection with the subject
matter of this Agreement.
5. Indemnification
(a) The Company hereby indemnifies the Bank and holds it harmless against, and
shall reimburse the Bank for, any loss, damage or expense (including attorneys’
reasonable fees and expenses, court costs and other expenses) including, but not
limited to, (i) unpaid charges, fees, and Returned Items for which the Company
and/or the Collateral Agent originally received credit or remittance by the
Bank, and (ii) any loss, damage or expense the Bank shall incur as a result of
(A) entering into or acting pursuant to this Agreement, (B) honoring and
following any instruction the Bank may receive from (or shall believe in good
faith to be from) the Collateral Agent or the Company under this Agreement, and
(C) upon implementation of the Notice, not honoring or following any instruction
it shall receive from (or shall believe in good faith to be from) the Company in
accordance with this Agreement. The Company shall not be responsible for any
loss, damage, or expense that a court having jurisdiction shall have determined
had been caused by the Bank’s gross negligence or willful misconduct in its
performance of its obligations under this Agreement.
(b) Without limiting in any way the Collateral Agent’s obligation to pay or
reimburse the Bank as otherwise specified in this Agreement, the Collateral
Agent hereby indemnifies the Bank and holds it harmless against any loss, damage
or expense (including attorneys’ reasonable fees and expenses, court costs and
other expenses) that the Bank shall incur as a result of honoring or following
any instruction (including the Notice) it shall receive from (or shall believe
in good faith to be from) the Collateral Agent under this Agreement. The
Collateral Agent shall not be responsible for any loss, damage, or expense that
a court having jurisdiction shall have determined had been caused by the Bank’s
gross negligence or willful misconduct in its performance of its obligations
under this Agreement.
(c) No party hereto shall be liable to any other party under this Agreement for
lost profits or special, indirect, exemplary, consequential or punitive damages,
even if such party shall have been advised of the possibility of such damages.
6. Third Party Claims; Insolvency of Company
(a) In the event that the Bank shall receive notice that any third party shall
have asserted an adverse claim by legal process against any Account or any sums
on deposit therein, any Lockbox or other Account Collateral, whether such claim
shall have arisen by tax lien, execution of judgment, statutory attachment,

EXHIBIT D-5

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garnishment, levy, claim of a trustee in bankruptcy, debtor-in-possession,
post-bankruptcy petition lender, court appointed receiver, or other judicial or
regulatory order or process (each, a “Claim”), the Bank may, in addition to
other remedies it possesses under the Deposit Agreement, this Agreement or at
law or in equity, suspend disbursements from such Account without any liability
until the Bank shall have received an appropriate court order or other
assurances reasonably acceptable to the Bank in its sole discretion establishing
that funds may continue to be disbursed according to instructions then
applicable to such Account. The Bank’s costs, expenses and attorneys’ reasonable
fees incurred in connection with any such Claim are Permitted Debits and shall
be reimbursed to the Bank in accordance with the provisions of Section 3 above.
(b) If a bankruptcy or insolvency proceeding were commenced by or against the
Company, the Bank shall be entitled, without any liability, to refuse to
(i) permit withdrawals or transfers from the Account(s) or (ii) accept or comply
with the Notice thereafter received by the Bank, until the Bank shall have
received an appropriate court order or other assurances reasonably acceptable to
the Bank in its sole discretion establishing that (A) continued withdrawals or
transfers from the Account(s) or honoring or following any instruction from
either the Company or the Secured Party are authorized and shall not violate any
law, regulation, or order of any court and (B) the Bank shall have received
adequate protection for its right to set off against or charge the Account(s) or
otherwise be reimbursed for all Permitted Debits.
7. Notice and Communications
(a) All communications given by any party to another as required or provided
under this Agreement must be in writing, directed to the respective designated
officer (“Designated Officer”) set forth under paragraph (c) of this Section 7,
and delivered to each recipient party at its address (or at such other address
and to such other Designated Officer as such party may designate in writing to
the other parties in accordance with this Section 7) either by U.S. Mail,
receipted delivery service or via facsimile transmission. All communications
given by the Collateral Agent to the Bank must be addressed and delivered
contemporaneously to both the Bank’s Designated Officer and the Bank’s “with
copy to” addressee at their respective addresses set forth below.
(b) Any communication (including the Notice) made by (or believed in good faith
by the Bank to be made by) the Company or the Collateral Agent to the Bank under
this Agreement shall be deemed delivered to the Bank if delivered by: (i) U.S.
Mail, on the date that such communication shall have been delivered to the
Bank’s Designated Officer; (ii) receipted delivery service, on the date and time
that such communication shall have been delivered to the Bank’s Designated
Officer and receipted by the delivery service; or (iii) facsimile transmission,
on the date and at the time that such communication shall have been delivered to
the Bank’s Designated Officer and receipt of such delivery shall have been
acknowledged by the recipient’s facsimile equipment. Notwithstanding the
provisions of the preceding sentence, any communication hereunder to the Bank
that is an instruction (including the Notice) delivered to the Bank and made by
(or believed by the Bank in good faith to be made by) the Company or the
Collateral Agent shall be deemed received by the Bank when actually delivered to
the Bank’s Designated Officer if delivered before 2:00 PM Eastern time on a
banking day or, if such communication were delivered after 2:00 PM Eastern time
on a banking day or delivered on a day that is not a banking day, then such
communication shall be deemed delivered to the Bank’s Designated Officer at the
Bank’s opening of its business on the next succeeding banking day. A “banking
day” means any day other than any Saturday or Sunday or other day on which the
offices of the Bank Designated Officer are authorized or required by law to
close.
(c) The Notice shall be implemented by the Bank by the close of business of the
offices of the Bank’s Designated Officer on the banking day that shall be one
(1) banking day after the banking day on which the

EXHIBIT D-6

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

 

Notice was actually received by the Bank’s Designated Officer. Any other
instruction delivered to the Bank shall be implemented by the Bank by the close
of business of the offices of the Bank’s Designated Officer on the banking day
that shall be two (2) banking days after the banking day on which such
instruction was actually received by the Bank’s Designated Officer.

     
Address for Collateral Agent:
  Wachovia Bank, National Association
 
  301 South College St., Mail Code                     
 
  Charlotte, North Carolina 28288
 
  Attn: Mr/s.                                         , Designated Officer
 
  Fax: 704.                     
 
   
          Address for Bank:
  Wachovia Bank, National Association
 
  Mail Code NC 0817
 
  301 South Tryon Street – Floor M7
 
  Charlotte, North Carolina 28288
 
  Attn: TS Legal Risk Mgmt, Designated Officer
 
  Fax: 704. 374. 4224
 
   
          with copy to:
  Wachovia Bank, National Association
 
  101 W. Main St., Mail Code VA 9568
 
  Norfolk, Virginia 23510-1646
 
  Attn: Mr. George Ball, Sr. Vice President
 
  Fax: 757. 640. 5690
 
   
          Address for Company:
  Amerigroup Corporation
 
  4425 Corporation Lane
 
  Virginia Beach, Virginia 23462
 
  Attn.: Mr/s.                     , Designated Officer
 
  Fax:                                         

8. Termination
(a) The Collateral Agent may terminate this Agreement at any time upon receipt
by the Bank of the Collateral Agent’s written notice of termination issued in
the text of Exhibit C attached hereto and made a part hereof (completed
accordingly). The Company may terminate this Agreement only with the express
prior written consent of the Collateral Agent and, in that case, the Collateral
Agent and the Company shall jointly so notify the Bank in writing. The Bank may
terminate this Agreement at any time on not less than thirty (30) calendar days’
prior written notice given to each of the Company and the Collateral Agent. The
Bank may also close any Account and/or terminate this Agreement immediately if
the Bank shall be instructed to do so by any court or governmental authority
having jurisdiction over the Bank, or if the Bank, in good faith, shall suspect
that the Account has been or is being used for a fraudulent or illegal purpose.
The Bank shall promptly notify the Company and the Collateral Agent of any such
immediate closing of any Account unless the Bank shall be prohibited from so
notifying the Company or the Collateral Agent by order of such court or
governmental authority.
(b) The Bank shall not be liable for the closure of any Lockbox or any Account
by the Company or the remittance of any funds therein directly to, or on the
instructions of, the Company prior to the implementation of the Notice by the
Bank. The Company shall notify the Collateral Agent promptly of the Company’s
closure of any Lockbox or any Account.

EXHIBIT D-7

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

 

(c) The Bank’s rights to demand and receive reimbursement from the Company under
Section 3 above and the Company’s indemnification of the Bank under Section 5
above shall survive termination of this Agreement. The Bank’s right to demand
reimbursement from the Collateral Agent under Section 3(c) above shall survive
termination of this Agreement for a period of ninety (90) calendar days after
the date of termination of this Agreement. The Bank’s right to demand
indemnification of the Bank from the Collateral Agent under Section 5(b) above
shall survive termination of this Agreement for a period of one hundred eighty
(180) calendar days after the date of termination of this Agreement.
(d) Upon termination of this Agreement, all funds thereafter on deposit or
deposited in the Accounts and all Items Collateral thereafter received by the
Bank shall be subject solely to the provisions of the Deposit Agreement between
the Company and the Bank.
9. Miscellaneous
(a) The Company shall not assign or transfer any of its rights or obligations
under this Agreement without the prior written consent of the Bank and the
Collateral Agent. The Collateral Agent shall not assign or transfer any of its
rights or obligations under this Agreement without the prior written consent of
the Bank (which consent will not be unreasonably withheld or delayed), except
that the Collateral Agent may transfer its rights and obligations under this
Agreement to an affiliate of the Collateral Agent or to the Collateral Agent’s
successor in interest by operation of law, either of which also must have
assumed all of the Collateral Agent’s obligations under this Agreement. No
permitted transfer of this Agreement by the Collateral Agent will be binding
upon the Bank or the Company until the Collateral Agent or its permitted
assignee or successor in interest shall have delivered a written notice to the
Bank and to the Company, signed by the permitted transferee/ successor in
interest, providing its address for communications under this Agreement, and
stating that it is an affiliate assignee of or successor in interest to the
Collateral Agent, and that it is entitled to the Collateral Agent’s rights and
has assumed all of the Collateral Agent’s obligations under this Agreement. The
Bank shall not assign or transfer any of its rights or obligations under this
Agreement without the prior written consent of the Collateral Agent and the
Company, except that the Bank may transfer its rights and obligations under this
Agreement to any direct or indirect depositary subsidiary of Wachovia
Corporation or, in the event of a merger or acquisition of the Bank, to the
Bank’s successor depositary institution (which subsidiary or successor shall be
a “bank” as defined in Section 9-102 of the New York UCC).
(b) The law governing the perfection and priority of the Secured Party’s
security interest in the Account Collateral shall be the law of the State of New
York, which State shall also be the “jurisdiction” of the Bank within the
meaning of Section 9-304 of the New York UCC. The Accounts, Items Collateral,
operation of the Accounts, and Deposit Agreement shall be governed by the
Applicable UCC, Federal Regulations and Operating Circulars, ACH or other
clearing house rules, and other applicable laws.
(c) This Agreement may be executed in any number of counterparts, each of which
shall be an original and all of which taken together shall constitute one and
the same Agreement. Delivery of an executed signature page counterpart to this
Agreement via facsimile transmission shall be effective as if it were delivery
of a manually delivered, original, executed counterpart thereof. This Agreement
can be modified or amended only by written agreement of all of the parties
hereto evidencing such modification or amendment.
(d) To the extent that any conflict may exist between the provisions of any
other agreement between the Company and the Bank and the provisions of this
Agreement, then this Agreement shall control. It is understood and agreed that
nothing in this Agreement shall give the Collateral Agent any benefit or legal
or equitable right, remedy or claim against the Bank under the Deposit
Agreement.

EXHIBIT D-8

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10. Waiver of Jury Trial EXCEPT AS PROHIBITED BY APPLICABLE LAW, EACH PARTY
HERETO IRREVOCABLY WAIVES ITS RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING
(INCLUDING ANY COUNTERCLAIM) OF ANY TYPE IN WHICH ANOTHER PARTY SHALL BE A PARTY
AS TO ALL MATTERS ARISING DIRECTLY OR INDIRECTLY OUT OF THIS AGREEMENT.
IN WITNESS WHEREOF, each of the parties by its respective duly authorized
officer has executed and delivered this Agreement as of the day and year first
written above.

                  BANK:       WACHOVIA BANK, NATIONAL ASSOCIATION    
 
               
 
      By        
 
      Name:  
 
    
 
      Title:  
 
 
 
         
 
  COMPANY:       AMERIGROUP CORPORATION    
 
               
 
      By        
 
      Name:  
 
    
 
      Title:  
 
 
 
         
 
  COLLATERAL AGENT:       WACHOVIA BANK, NATIONAL ASSOCIATION,
          as Collateral Agent    
 
               
 
      By        
 
      Name:  
 
    
 
      Title:  
 
 
 
         
 
 

EXHIBIT D-9

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

 

EXHIBIT A
ACCOUNTS OF THE COMPANY

                  Related Lockbox       State in Which Account Number   Number,
if any   Account Name   Account is Located
 
           

EXHIBIT D-A-1

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

 

EXHIBIT B
[To be Issued on Letterhead of Collateral Agent]
                     200_
WACHOVIA BANK, NATIONAL ASSOCIATION
Mail Code NC 0817
301 South Tryon Street – Floor M7
Charlotte, North Carolina 28288
Attention: TS Legal Risk Mgmt, Designated Officer
     NOTICE PURSUANT TO DEPOSIT ACCOUNT CONTROL AGREEMENT
Ladies and Gentlemen:
     Pursuant to the Deposit Account Control Agreement (With Future
Notification) among AMERIGROUP CORPORATION (the “Company”), you and us dated as
of March ___, 2007 (the “Agreement”), a photocopy of which as fully executed is
attached hereto, this letter shall serve as the Notice as described in and
contemplated by the Agreement. Capitalized terms used but not defined in this
letter shall have the meanings given them in the Agreement.
     You are hereby instructed to not permit any access to or disposition over
the Account(s) or other Account Collateral by, and to not accept any instruction
with regard to the Account(s) or other Account Collateral from, any person other
than the Collateral Agent (or as otherwise provided in Section 6 of the
Agreement). None of the officers, agents or other representatives of the Company
or any of its affiliates shall at any time hereafter be permitted to direct the
disposition of funds in any Account, or to draw upon or otherwise exercise any
authority or power with respect to any Lockbox, Account or Account Collateral
related thereto.

                  Very truly yours,    
 
                WACHOVIA BANK, NATIONAL ASSOCIATION,
          as Collateral Agent    
 
           
 
  By        
 
  Name:  
 
    
 
  Title:  
 
 
 
     
 
    

Attachment
cc: [“with copy to” addressee at the Bank as per Section 7 of the Agreement]

EXHIBIT D-B-1

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

 

EXHIBIT C
[To be Issued on Letterhead of Collateral Agent]
                     200_
WACHOVIA BANK, NATIONAL ASSOCIATION
Mail Code NC 0817
301 South Tryon Street – Floor M7
Charlotte, North Carolina 28288
Attention: TS Legal Risk Mgmt, Designated Officer
AMERIGROUP CORPORATION
 
 
Attention:                                                             ,
Designated Officer
     NOTICE OF TERMINATION OF DEPOSIT ACCOUNT CONTROL AGREEMENT
Ladies and Gentlemen:
     We refer you to the Deposit Account Control Agreement (With Future
Notification) among AMERIGROUP CORPORATION (the “Company”), you and us dated as
of March ___, 2007 (the “Agreement”), a photocopy of which is attached hereto.
Capitalized terms used but not defined in this letter shall have the meanings
given them in the Agreement.
     We hereby notify you that by this letter we are exercising our right under
Section 8(a) of the Agreement (subject to your rights as set forth in the
Agreement) to terminate the Agreement in accordance with its terms. Accordingly
the Agreement shall terminate at the close of the Bank’s business [this day] [on
                     ___, 200_], subject to those undertakings that shall
survive termination of the Agreement. Upon termination of the Agreement, all
funds thereafter on deposit or deposited in the Account(s) and all Items
Collateral received by the Bank shall be subject solely to the provisions of the
Deposit Agreement between the Company and the Bank.

                  Very truly yours,         WACHOVIA BANK, NATIONAL ASSOCIATION,
          AS COLLATERAL AGENT    
 
           
 
  By  
 
   
 
  Name:  
 
    
 
  Title:  
 
   
 
     
 
   

Attachment
cc: [“with copy to” addressee at the Bank as per Section 7 of the Agreement]

EXHIBIT D-C-1

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

 

EXHIBIT E
TO PLEDGE AND SECURITY AGREEMENT
TRADEMARK SECURITY AGREEMENT
Trademark Security Agreement, dated as of March 26, 2007 (as amended, restated
or otherwise modified, the “Trademark Security Agreement”), between AMERIGROUP
CORPORATION (the “Grantor”) and WACHOVIA BANK, NATIONAL ASSOCIATION, in its
capacity as collateral agent for the Secured Parties (together with successors
and assigns in such capacity, the “Collateral Agent”).
W i t n e s s e t h:
Whereas, Grantor is party to a Pledge and Security Agreement dated as of
March 26, 2007 (the “Pledge and Security Agreement”) between the Grantor, the
other grantors party thereto and the Collateral Agent pursuant to which the
Grantor is required to execute and deliver this Trademark Security Agreement;
Now, Therefore, in consideration of the premises and to induce the Secured
Parties to enter into the Credit Agreement, the Grantor hereby agrees with the
Collateral Agent, as follows:
SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the
Pledge and Security Agreement and used herein have the meaning given to them in
the Pledge and Security Agreement.
SECTION 2. Grant of Security Interest in Trademark Collateral. Grantor hereby
grants to the Collateral Agent for the benefit of the Secured Parties, a
security interest in and continuing lien on all of Grantor’s right, title and
interest in, to and under the following, whether now owned or existing or
hereafter created or acquired or arising and wherever located (collectively, the
“Trademark Collateral”):
(a) all United States, and foreign trademarks, trade names, corporate names,
company names, business names, fictitious business names, Internet domain names,
service marks, certifications 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, but not
limited to: (i) the registrations and applications referred to on Schedule I
hereto (ii) all extensions or renewals of any of the foregoing, (iii) all of the
goodwill of the business connected with the use of and symbolized by the
foregoing, (iv) the right to sue for past, present and future infringement or
dilution of any of the foregoing or for any injury to goodwill, and (v) all
Proceeds of the foregoing, including, without limitation, licenses, royalties,
income payments, claims, damages and proceeds of suit (collectively,
“Trademarks”); and
(b) any and all agreements providing for the granting of any right in or to
Trademarks (whether Grantor is licensee or licensor thereunder) including those
referred to on Schedule I hereto (collectively, “Trademark Licenses”).
SECTION 3. Security Agreement. The security interest granted pursuant to this
Trademark Security Agreement is granted in conjunction with the security
interest granted to the Collateral Agent for the Secured Parties pursuant to the
Pledge and Security Agreement and Grantor hereby acknowledges and affirms that
the rights and remedies of the Collateral Agent with respect to the security
interest in the Trademark Collateral made and granted hereby are more fully set
forth in the Pledge and Security Agreement, the terms and provisions of which
are incorporated by reference herein as if fully set forth herein. In the event
that any provision of this Trademark

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

 

Security Agreement is deemed to conflict with the Pledge and Security Agreement,
the provisions of the Pledge and Security Agreement shall control.
SECTION 4. Applicable Law. This Trademark Security Agreement and the rights and
obligations of the parties hereunder shall be governed by, and shall be
construed and enforced in accordance with, the laws of the State of New York.
SECTION 5. Counterparts. This Trademark Security Agreement may be executed in
any number of counterparts, each of which when so executed and delivered shall
be deemed an original, but all such counterparts together shall constitute but
one and the same instrument.
[Remainder of page intentionally left blank]

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

 

In Witness Whereof, Grantor has caused this Trademark Security Agreement to be
executed and delivered by its duly authorized officer as of the date first set
forth above.

                      AMERIGROUP CORPORATION    
 
               
 
  By:                           
 
      Name:        
 
      Title:        
 
         
 
    

[Signature Page to Trademark Security Agreement]

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

 

Accepted and Agreed:
WACHOVIA BANK, NATIONAL ASSOCIATION
as Collateral Agent

             
By:
                      
 
  Name:        
 
  Title:        
 
     
 
    

[Signature Page to Trademark Security Agreement]

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SCHEDULE I
to
TRADEMARK SECURITY AGREEMENT
TRADEMARK REGISTRATIONS AND APPLICATIONS

Schedule I

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EXHIBIT F
TO PLEDGE AND SECURITY AGREEMENT
COPYRIGHT SECURITY AGREEMENT
Copyright Security Agreement, dated as of March 26, 2007 (as amended, restated
or otherwise modified from time to time, the “Copyright Security Agreement”),
between AMERIGROUP CORPORATION (the “Grantor”) and WACHOVIA BANK, NATIONAL
ASSOCIATION, in its capacity as collateral agent for the Secured Parties
(together with its successors and assigns in such capacity, the “Collateral
Agent”).
W i t n e s s e t h:
Whereas, Grantor is party to a Pledge and Security Agreement dated as of
March 26, 2007 (the “Pledge and Security Agreement”) between the Grantor, the
other grantors party thereto and the Collateral Agent pursuant to which the
Grantor is required to execute and deliver this Copyright Security Agreement;
Now, Therefore, in consideration of the premises and to induce the Secured
Parties to enter into the Credit Documents, the Grantor hereby agrees with the
Collateral Agent, as follows:
SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the
Pledge and Security Agreement and used herein have the meaning given to them in
the Pledge and Security Agreement.
SECTION 2. Grant of Security Interest in Copyright Collateral. Grantor hereby
grants to the Collateral Agent, for the benefit of the Secured Parties, a
security interest in and continuing lien on all of Grantor’s right, title and
interest in, to and under the following, whether now owned or existing or
hereafter created or acquired or arising and wherever located (collectively, the
“Copyright Collateral”):
(a) all United States, and foreign copyrights (including community designs),
including but not limited to 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:
(i) all registrations and applications referred to on Schedule I hereto,
(ii) all extensions and renewals thereof, (iii) all rights corresponding thereto
throughout the world, (iv) all rights to sue for past, present and future
infringements thereof, and (v) all Proceeds of the foregoing, including, without
limitation, licenses, royalties, income, payments, claims, damages and proceeds
of suit (collectively, “Copyrights”); and
(b) any and all agreements providing for the granting of any right in or to
Copyrights (whether or not Grantor is licensee or licensor thereunder) including
those referred to on Schedule I hereto (collectively, “Copyright Licenses”).
SECTION 3. Security Agreement. The security interest granted pursuant to this
Copyright Security Agreement is granted in conjunction with the security
interest granted to the Collateral Agent for the Secured Parties pursuant to the
Pledge and Security Agreement and Grantor hereby acknowledges and affirms that
the rights and remedies of the Collateral Agent with respect to the security
interest in the Copyrights made and granted hereby are more fully set forth in
the Pledge and Security Agreement, the terms and provisions of which are
incorporated by reference herein as if fully set forth herein. In the event that
any provision of this Copyright Security Agreement

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

 

is deemed to conflict with the Pledge and Security Agreement, the provisions of
the Pledge and Security Agreement shall control.
SECTION 4. Applicable Law. This Copyright Security Agreement and the rights and
obligations of the parties hereunder shall be governed by, and shall be
construed and enforced in accordance with, the laws of the State of New York,
without regard to its conflicts of law provisions (other than Section 5-1401 and
Section 5-1402 of the New York General Obligation Laws).
SECTION 5. Counterparts. This Agreement may be executed in any number of
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument.
[Remainder of page intentionally left blank]

8

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

 

In Witness Whereof, Grantor has caused this Copyright Security Agreement to be
executed and delivered by its duly authorized officer as of the date first set
forth above.

                      AMERIGROUP CORPORATION
   
 
  By:                           
 
      Name:        
 
      Title:        
 
         
 
    

[Signature Page to Copyright Security Agreement]

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

 

Accepted and Agreed:
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Collateral Agent

             
By:
                      
 
  Name:        
 
     
 
    
 
  Title:        
 
     
 
    

[Signature Page to Copyright Security Agreement]

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

 

SCHEDULE I
to
COPYRIGHT SECURITY AGREEMENT
COPYRIGHT REGISTRATIONS AND APPLICATIONS
[Signature Page to Copyright Security Agreement]

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

 

EXHIBIT G
TO PLEDGE AND SECURITY AGREEMENT
PATENT SECURITY AGREEMENT
Patent Security Agreement, dated as of March ___, 2007 (as amended, restated or
otherwise modified from time to time, the “Patent Security Agreement”), between
each of [INSERT NAMES OF GRANTORS] (collectively, the “Grantors”), and WACHOVIA
BANK, NATIONAL ASSOCIATION, in its capacity as collateral agent for the Secured
Parties (together with any successors and assigns thereto in such capacity, the
“Collateral Agent”).
W i t n e s s e t h:
Whereas, Grantors are party to a Pledge and Security Agreement dated as of March
[___], 2007 (the “Pledge and Security Agreement”) between each of the Grantors
and the other grantors thereto and the Collateral Agent pursuant to which the
Grantors are required to execute and deliver this Patent Security Agreement;
Now, Therefore, in consideration of the premises and to induce the Secured
Parties to enter into the Credit Agreement, the Grantors hereby agree with the
Collateral Agent, as follows:
SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the
Pledge and Security Agreement and used herein have the meaning given to them in
the Pledge and Security Agreement.
SECTION 2. Grant of Security Interest in Patent Collateral. Each Grantor grants
to the Collateral Agent, for the benefit of the Secured Parties, a security
interest in and continuing lien on all of such Grantor’s right, title and
interest in, to and under the following, whether now owned or existing or
hereafter created or acquired or arising and wherever located (collectively, the
“Patent Collateral”):
(a) all United States and foreign patents and certificates of invention, or
similar industrial property rights, and applications for any of the foregoing
(collectively, “Patents”), including, but not limited to: (i) each patent and
patent application referred to on Schedule I hereto (as such schedule may be
amended or supplemented from time to time), (ii) all reissues, divisions,
continuations, continuations-in-part, extensions, renewals, and reexaminations
thereof, (iii) all rights corresponding thereto throughout the world, (iv) all
inventions and improvements described therein, (v) all rights to sue for past,
present and future infringements thereof, (vi) all licenses, claims, damages,
and proceeds of suit arising therefrom, and (vii) all Proceeds of the foregoing,
including, without limitation, licenses, royalties, income, payments, claims,
damages, and proceeds of suit and
(b) all agreements providing for the granting of any right in or to Patents
(whether such Grantor is licensee or licensor thereunder) including those
referred to on Schedule I hereto (collectively, “Patent Licenses”).
SECTION 3. Security Agreement. The security interest granted pursuant to this
Patent Security Agreement is granted in conjunction with the security interest
granted to the Collateral Agent for the Secured Parties pursuant to the Pledge
and Security Agreement and Grantors hereby acknowledge and affirm that the
rights and remedies of the Collateral Agent with respect to the security
interest in the Patent Collateral made and granted hereby are more fully set
forth in the Pledge and Security Agreement, the terms and provisions of which
are incorporated by reference herein as if fully set forth herein. In the event
that any provision of this Patent Security

12

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Agreement is deemed to conflict with the Pledge and Security Agreement, the
provisions of the Pledge and Security Agreement shall control.
SECTION 4. Applicable Law. This Patent Security Agreement and the rights and
obligations of the parties hereunder shall be governed by, and shall be
construed and enforced in accordance with, the laws of the State of New York,
without regard to its conflicts of law provisions (other than Section 5-1401 and
Section 5-1402 of the New York General Obligation Laws).
SECTION 5. Counterparts. This Patent Security Agreement may be executed in any
number of counterparts, each of which when so executed and delivered shall be
deemed an original, but all such counterparts together shall constitute but one
and the same instrument.
[Remainder of page intentionally left blank]

13

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In Witness Whereof, each Grantor has caused this Patent Security Agreement to be
executed and delivered by its duly authorized officer as of the date first set
forth above.

                  [NAME OF EACH GRANTOR]    
 
           
 
  By:        
 
     
 
Name:     
 
      Title:    

[Signature Page to Patent Security Agreement]

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

 

Accepted and Agreed:
WACHOVIA BANK, NATIONAL ASSOCIATION,
as Collateral Agent

         
By:
       
 
 
 
Name:     
 
  Title:    

[Signature Page to Patent Security Agreement]

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

 

SCHEDULE I
to
PATENT SECURITY AGREEMENT
PATENT REGISTRATIONS AND APPLICATIONS
[Signature Page to Patent Security Agreement]