PLEDGE AND SECURITY AGREEMENT

This PLEDGE AND SECURITY AGREEMENT, dated as of June 6, 2006 (as amended,
supplemented, amended and restated or otherwise modified from time to time, this
“Security Agreement”), is made by FERRO CORPORATION, an Ohio corporation (the
“Company”), and each U.S. Subsidiary (other than an SPV) (terms used in the
preamble and the recitals have the definitions set forth in or incorporated by
reference in Article I) from time to time a party to this Security Agreement
(each individually a “Grantor” and collectively, the “Grantors”), in favor of
NATIONAL CITY BANK (“National City”), as the collateral agent (together with its
successor(s) thereto in such capacity, the “Collateral Agent”) for the benefit
of the Secured Parties.

W I T N E S S E T H
:

WHEREAS, this Security Agreement is made pursuant to the Credit Agreement, dated
as of June 6, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Credit Agreement”), among the Company, the
Designated Borrowers from time to time party thereto (together with the Company,
each individually, a “Borrower” and collectively, the “Borrowers”), the various
financial institutions and other Persons from time to time party thereto (the
“Lenders”), Credit Suisse, Cayman Islands Branch, as the Term Loan
Administrative Agent, National City as the Revolving Loan Administrative Agent
and the Collateral Agent, and Keybank National Association, as the Documentation
Agent; and

WHEREAS, it is a condition to the making of Loans and the issuance of, and
participation in, Letters of Credit, under the Credit Agreement that each
Grantor shall have executed and delivered this Security Agreement;

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, each Grantor hereby makes the following
representations and warranties to the Collateral Agent and the other Secured
Parties and hereby covenants and agrees with the Collateral Agent, for the
benefit of each Secured Party, as follows:

ARTICLE I

DEFINITIONS

SECTION 1.1 Certain Terms. The following terms (whether or not underscored) when
used in this Security Agreement, including its preamble and recitals, shall have
the following meanings (such definitions to be equally applicable to the
singular and plural forms thereof):

“Borrowers” is defined in the preamble.

“Collateral” is defined in Section 2.1.

“Collateral Account” is defined in clause (b) of Section 4.3.

“Collateral Agent” is defined in the preamble.

“Computer Hardware and Software Collateral” means:

(a) all computer and other electronic data processing hardware, integrated
computer systems, central processing units, memory units, display terminals,
printers, features, computer elements, card readers, tape drives, hard and soft
disk drives, cables, electrical supply hardware, generators, power equalizers,
accessories and all peripheral devices and other related computer hardware,
including all operating system software, utilities and application programs in
whatsoever form;

(b) all software programs (including both source code, object code and all
related applications and data files), designed for use on the computers and
electronic data processing hardware described in clause (a) above;

(c) all firmware associated therewith;

(d) all documentation (including flow charts, logic diagrams, manuals, guides,
specifications, training materials, charts and pseudo codes) with respect to
such hardware, software and firmware described in the preceding clauses (a)
through (c); and

(e) all rights with respect to all of the foregoing, including copyrights,
licenses, options, warranties, service contracts, program services, test rights,
maintenance rights, support rights, improvement rights, renewal rights and
indemnifications and any substitutions, replacements, improvements, error
corrections, updates, additions or model conversions of any of the foregoing.

“Control Agreement” means an authenticated record in form and substance
satisfactory to the Collateral Agent, that provides for the Collateral Agent to
have “control” (as defined in the UCC) over certain Collateral.

“Copyright Collateral” means all copyrights of the Grantors, registered or
unregistered and whether published or unpublished, now or hereafter in force
throughout the world including all of the Grantors’ rights, titles and interests
in and to all copyrights registered in the United States Copyright Office or
anywhere else in the world and also including the copyrights referred to in
Item A of Schedule V, and registrations and recordings thereof and all
applications for registration thereof, whether pending or in preparation, all
copyright licenses, including each copyright license referred to in Item B of
Schedule V, the right to sue for past, present and future infringements of any
of the foregoing, all rights corresponding thereto, all extensions and renewals
of any thereof and all Proceeds of the foregoing, including licenses, royalties,
income, payments, claims, damages and Proceeds of suit, which are owned or
licensed by the Grantors.

“Credit Agreement” is defined in the first recital.

“Distributions” means all dividends paid on Capital Stock pledged hereunder,
liquidating dividends paid on Capital Stock pledged hereunder, shares (or other
designations) of Capital Stock resulting from (or in connection with the
exercise of) stock splits, reclassifications, warrants, options, non-cash
dividends, mergers, consolidations, and all other distributions (whether similar
or dissimilar to the foregoing) on or with respect to any Capital Stock
constituting Collateral.

“General Intangibles” means all “general intangibles” and all “payment
intangibles”, each as defined in the UCC, and shall include all interest rate or
currency protection or hedging arrangements, all tax refunds, all licenses,
permits, concessions and authorizations and all Intellectual Property Collateral
(in each case, regardless of whether characterized as general intangibles under
the UCC).

“Grantor” and “Grantors” are defined in the preamble.

“Intellectual Property Collateral” means, collectively, the Computer Hardware
and Software Collateral, the Copyright Collateral, the Patent Collateral, the
Trademark Collateral and the Trade Secrets Collateral.

“Organic Document” means, relative to any Grantor, as applicable, its
certificate or articles of incorporation, articles and memorandum of
association, by-laws, certificate of partnership, partnership agreement,
certificate of formation, limited liability agreement, operating agreement and
all shareholder agreements, voting trusts and similar arrangements applicable to
any of such Grantor’s Capital Stock pledged hereunder.

“Patent Collateral” means:

(a) inventions and discoveries, whether patentable or not, all letters patent
and applications for letters patent throughout the world, including all patent
applications in preparation for filing and each patent and patent application
referred to in Item A of Schedule III;

(b) all reissues, divisions, continuations, continuations-in-part, extensions,
renewals and reexaminations of any of the items described in clause (a);

(c) all patent licenses, and other agreements providing such Grantor with the
right to use any items of the type referred to in clauses (a) and (b) above,
including each patent license referred to in Item B of Schedule III; and

(d) all Proceeds of, and rights associated with, the foregoing (including
licenses, royalties income, payments, claims, damages and Proceeds of
infringement suits), the right to sue third parties for past, present or future
infringements of any patent or patent application, and for breach or enforcement
of any patent license.

“Permitted Lien” means a Lien permitted under Section 7.2.3 of the Credit
Agreement.

“Secured Obligations” shall mean and include:

(a) all Obligations and other liabilities owing by the Borrowers or any other
Obligor to the Secured Parties under the Credit Agreement and the other Loan
Documents to which the Borrowers or any other Obligors are now or may hereafter
become a party (including, without limitation, indemnities, Fees and other
amounts payable thereunder), whether primary, secondary, direct, contingent,
fixed or otherwise,

(b) all Indebtedness of the type described in clauses (j), (k) and (l) of
Section 7.2.2 of the Credit Agreement (without giving effect to any dollar
limitations set forth in any such clause) owed to a Lender or any of its
Affiliates, and

(c) all obligations of the Company or any of its Subsidiaries in respect of
overdrafts and related liabilities owed to a Lender or any of its Affiliates and
arising from cash management services (including treasury, depository,
overdraft, credit or debit card, electronic funds transfer and other cash
management arrangements),

in all cases whether now existing, or hereafter incurred or arising, including
any such interest or other amounts incurred or arising during the pendency of
any bankruptcy, insolvency, reorganization, receivership or similar proceeding,
regardless of whether allowed or allowable in such proceeding or subject to an
automatic stay under section 362(a) of the Bankruptcy Code in Title 11 of the
United States Code, as amended, modified, superseded or replaced from time to
time.

“Securities Act” is defined in clause (a) of Section 6.2.

“Security Agreement” is defined in the preamble.

“Specified Default” means the occurrence and continuance of (a) an Event of
Default or (b) a Default under clauses (a) through (d) of Section 8.1.9 of the
Credit Agreement.

“Trademark Collateral” means :

(a) (i) all trademarks, trade names, corporate names, company names, business
names, fictitious business names, trade styles, service marks, certification
marks, collective marks, logos and other source or business identifiers, and all
goodwill of the business associated therewith, now existing or hereafter adopted
or acquired including those referred to in Item A of Schedule IV, whether
currently in use or not, all registrations and recordings thereof and all
applications in connection therewith, whether pending or in preparation for
filing, including registrations, recordings and applications in the United
States Patent and Trademark Office or in any office or agency of the United
States, or any State thereof or any other country or political subdivision
thereof or otherwise, and all common-law rights relating to the foregoing, and
(ii) the right to obtain all reissues, extensions or renewals of the foregoing
(collectively referred to as the “Trademark”);

(b) all trademark licenses for the grant by or to such Grantor of any right to
use any trademark, including each trademark license referred to in Item B of
Schedule IV; and

(c) all of the goodwill of the business connected with the use of, and
symbolized by the items described in, clause (a), and to the extent applicable
clause (b);

(d) the right to sue third parties for past, present and future infringements of
any Trademark Collateral described in clause (a) and, to the extent applicable,
clause (b); and

(e) all Proceeds of, and rights associated with, the foregoing, including any
claim by such Grantor against third parties for past, present or future
infringement or dilution of any Trademark, Trademark registration or Trademark
license, or for any injury to the goodwill associated with the use of any such
Trademark or for breach or enforcement of any Trademark license and all rights
corresponding thereto throughout the world.

“Trade Secrets Collateral” means all common law and statutory trade secrets and
all other confidential, proprietary or useful information and all know-how
obtained by or used in or contemplated at any time for use in the business of a
Grantor (all of the foregoing being collectively called a “Trade Secret”),
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, all Trade Secret licenses, including each Trade
Secret license referred to in Schedule VI, and including the right to sue for
and to enjoin and to collect damages for the actual or threatened
misappropriation of any Trade Secret and for the breach or enforcement of any
such Trade Secret license.

SECTION 1.2 Credit Agreement Definitions. Unless otherwise defined herein or the
context otherwise requires, terms used in this Security Agreement, including its
preamble and recitals, have the meanings provided in the Credit Agreement.

SECTION 1.3 UCC Definitions. When used herein the terms Account, Certificated
Securities, Chattel Paper, Commercial Tort Claim, Commodity Account, Commodity
Contract, Deposit Account, Document, Electronic Chattel Paper, Equipment, Goods,
Instrument, Inventory, Investment Property, Letter-of-Credit Rights, Proceeds,
Promissory Notes, Securities Account, Security Entitlement, Supporting
Obligations and Uncertificated Securities have the meaning provided in Article 8
or Article 9, as applicable, of the UCC. Letters of Credit has the meaning
provided in Section 5-102 of the UCC.

ARTICLE II

SECURITY INTEREST

SECTION 2.1 Grant of Security Interest. Each Grantor hereby grants to the
Collateral Agent, for its benefit and the ratable benefit of each other Secured
Party, a continuing security interest, and a right to set-off against, any and
all right, title and interest of such Grantor’s in and to the following
property, whether now or hereafter existing, owned or acquired by such Grantor,
and wherever located (collectively, the “Collateral”):

(a) Accounts;

(b) Chattel Paper;

(c) Commercial Tort Claims listed on Item I of Schedule II (as such schedule may
be amended or supplemented from time to time);

(d) Deposit Accounts;

(e) Documents;

(f) General Intangibles;

(g) Goods;

(h) Instruments;

(i) Investment Property;

(j) Letter-of-Credit Rights and Letters of Credit (other than such as is
collateral for or issued subject to or in connection with the Company’s existing
accounts receivable securitization program);

(k) Supporting Obligations;

(l) all books, records, writings, databases, computer programs, tapes, disks,
related data processing software (owned by such Grantor or in which it has an
assignable interest), information and other property relating to, used or useful
in connection with, evidencing, embodying, incorporating or referring to, any of
the foregoing in this Section or are otherwise helpful in the collection or
realization thereupon;

(m) all Proceeds of the foregoing and, to the extent not otherwise included,
(A) all payments under insurance (whether or not the Collateral Agent is the
loss payee thereof) and (B) all tort claims; and

(n) all other property and rights of every kind and description and interests
therein.

Notwithstanding the foregoing, the term “Collateral” shall not include:

(i) such Grantor’s real property interests (including fee real estate, leasehold
interests and fixtures);

(ii) any General Intangibles or other rights arising under any contracts,
instruments, licenses or other documents as to which the grant of a security
interest would (A) constitute a violation of a valid and enforceable restriction
in favor of a third party on such grant, unless and until any required consents
shall have been obtained, or (B) give any other party to such contract,
instrument, license or other document the right to terminate its obligations
thereunder;

(iii) Investment Property consisting of Capital Stock of a Foreign Subsidiary of
such Grantor, in excess of 65% of the total combined voting power of all Capital
Stock of each such Foreign Subsidiary, except that such 65% limitation shall not
apply to a Foreign Subsidiary that (x) is treated as a partnership under the
Code or (y) is not treated as an entity that is separate from (A) such Grantor;
(B) any Person that is treated as a partnership under the Code or (C) any
“United States person” (as defined in Section 7701(a)(30) of the Code);

(iv) any asset, the granting of a security interest in which would be void or
illegal under any applicable governmental law, rule or regulation, or pursuant
thereto would result in, or permit the termination of, such asset;

(v) any asset subject to a Permitted Lien (other than Liens in favor of the
Collateral Agent) to the extent that the grant of other Liens on such asset (A)
would result in a breach or violation of, or constitute a default under, the
agreement or instrument governing such Permitted Lien, (B) would result in the
loss of use of such asset or (C) would permit the holder of such Permitted Lien
to terminate the Grantor’s use of such asset;

(vi) trade receivables and related collateral, credit support and similar rights
sold or contributed pursuant to the Company’s existing accounts receivable
securitization program (other than residual interests therein);

(vii) Inventory that has been chemically combined with precious metals inventory
or inventories such that an attempt to separate such inventories would destroy
or substantially devalue the inventory that would otherwise be subject to this
Security Agreement; or

(viii) Consigned metals or leased metals that are held as Inventory by such
Grantor but for which title has not yet transferred to such Grantor.

SECTION 2.2 Security for Secured Obligations. This Security Agreement and the
Collateral in which the Collateral Agent for the benefit of the Secured Parties
is granted a security interest hereunder by the Grantors to secure the prompt
payment and performance in full when due, whether by lapse of time,
acceleration, mandatory prepayment or otherwise, of the Secured Obligations.

SECTION 2.3 Grantors Remain Liable. Anything herein to the contrary
notwithstanding:

(a) the Grantors will remain liable under the contracts and agreements included
in the Collateral to the extent set forth therein, and will perform all of their
duties and obligations under such contracts and agreements to the same extent as
if this Security Agreement had not been executed;

(b) the exercise by the Collateral Agent of any of its rights hereunder will not
release any Grantor from any of its duties or obligations under any such
contracts or agreements included in the Collateral; and

(c) no Secured Party will have any obligation or liability under any contracts
or agreements included in the Collateral by reason of this Security Agreement,
nor will any Secured Party be obligated to perform any of the obligations or
duties of any Grantor thereunder or to take any action to collect or enforce any
claim for payment assigned hereunder.

SECTION 2.4 Distributions on Pledged Shares. In the event that any Distribution
with respect to any Capital Stock pledged hereunder is permitted to be paid (in
accordance with Section 7.2.6 of the Credit Agreement), such Distribution or
payment may be paid directly to the applicable Grantor. If any Distribution is
made in contravention of Section 7.2.6 of the Credit Agreement, such Grantor
shall hold the same segregated and in trust for the Collateral Agent until paid
to the Collateral Agent in accordance with Section 4.1.5.

SECTION 2.5 Security Interest Absolute, etc. This Security Agreement shall in
all respects be a continuing, absolute, unconditional and irrevocable grant of
security interest, and shall remain in full force and effect until the
Termination Date. All rights of the Secured Parties and the security interests
granted to the Collateral Agent (for its benefit and the ratable benefit of each
other Secured Party) hereunder, and all obligations of the Grantors hereunder,
shall, in each case, be absolute, unconditional and irrevocable irrespective of:

(a) any lack of validity, legality or enforceability of any Loan Document;

(b) the failure of any Secured Party (i) to assert any claim or demand or to
enforce any right or remedy against any Credit Party or any other Person
(including any other Grantor) under the provisions of any Loan Document or
otherwise, or (ii) to exercise any right or remedy against any other guarantor
(including any other Grantor) of, or collateral securing, any Secured
Obligations;

(c) any change in the time, manner or place of payment of, or in any other term
of, all or any part of the Secured Obligations, or any other extension,
compromise or renewal of any Secured Obligations;

(d) any reduction, limitation, impairment or termination of any Secured
Obligations for any reason, including any claim of waiver, release, surrender,
alteration or compromise, and shall not be subject to (and each Grantor hereby
waives any right to or claim of) any defense or setoff, counterclaim, recoupment
or termination whatsoever by reason of the invalidity, illegality,
nongenuineness, irregularity, compromise, unenforceability of, or any other
event or occurrence affecting, any Secured Obligations or otherwise;

(e) any amendment to, rescission, waiver, or other modification of, or any
consent to or departure from, any of the terms of any Loan Document;

(f) any addition, exchange or release of any Collateral or of any Person that is
(or will become) a Grantor (including the Grantors hereunder) of the Secured
Obligations, or any surrender or non-perfection of any collateral, or any
amendment to or waiver or release or addition to, or consent to or departure
from, any other guaranty held by any Secured Party securing any of the Secured
Obligations; or

(g) any other circumstance which might otherwise constitute a defense available
to, or a legal or equitable discharge of, any Credit Party, any surety or any
guarantor.

SECTION 2.6 Postponement of Subrogation. Each Grantor agrees that it will not
exercise any rights against another Grantor which it may acquire by way of
rights of subrogation under any Loan Document to which it is a party. No Grantor
shall seek or be entitled to seek any contribution or reimbursement from any
Credit Party, in respect of any payment made under any Loan Document or
otherwise, until following the Termination Date. Any amount paid to such Grantor
on account of any such subrogation rights prior to the Termination Date shall be
held in trust for the benefit of the Secured Parties and shall immediately be
paid and turned over to the Collateral Agent for the benefit of the Secured
Parties in the exact form received by such Grantor (duly endorsed in favor of
the Collateral Agent, if required), to be credited and applied against the
Secured Obligations, whether matured or unmatured, in accordance with
Section 6.1; provided that if the Termination Date has occurred, then at such
Grantor’s request, the Collateral Agent (on behalf of the Secured Parties) will,
at the expense of such Grantor, execute and deliver to such Grantor appropriate
documents (without recourse and without representation or warranty) necessary to
evidence the transfer by subrogation to such Grantor of an interest in the
Secured Obligations resulting from such payment. In furtherance of the
foregoing, at all times prior to the Termination Date, such Grantor shall
refrain from taking any action or commencing any proceeding against any Obligor
(or its successors or assigns, whether in connection with a bankruptcy
proceeding or otherwise) to recover any amounts in respect of payments made
under this Security Agreement to any Secured Party.

ARTICLE III

REPRESENTATIONS AND WARRANTIES

In order to induce the Secured Parties to enter into the Credit Agreement and
make Loans, or issue Letters of Credit thereunder, the Grantors represent and
warrant to each Secured Party as set forth below.

SECTION 3.1 As to Capital Stock of the Subsidiaries, Investment Property.

(a) With respect to any Subsidiary of any Grantor that is

(i) a corporation, business trust, joint stock company or similar Person, all
Capital Stock pledged hereunder issued by such Subsidiary is duly authorized and
validly issued, fully paid and non-assessable, and represented by a certificate;
and

(ii) a partnership or limited liability company, no Capital Stock pledged
hereunder issued by such Subsidiary (A) is dealt in or traded on securities
exchanges or in securities markets, (B) expressly provides that such Capital
Stock is a security governed by Article 8 of the UCC or (C) is held in a
Securities Account, except, with respect to this clause (a)(ii), Capital Stock
pledged hereunder (x) for which the Collateral Agent is the registered owner or
(y) with respect to which the issuer has agreed in an authenticated record with
such Grantor and the Collateral Agent to comply with any instructions of the
Collateral Agent without the consent of such Grantor.

(b) Each Grantor has delivered all Certificated Securities constituting
Collateral held by such Grantor on the Closing Date to the Collateral Agent,
together with duly executed undated blank stock powers, or other equivalent
instruments of transfer acceptable to the Collateral Agent.

(c) With respect to Uncertificated Securities constituting Collateral owned by
any Grantor, such Grantor has caused the issuer thereof either to (i) register
the Collateral Agent as the registered owner of such security or (ii) agree in
an authenticated record with such Grantor and the Collateral Agent that such
issuer will comply with instructions with respect to such security originated by
the Collateral Agent without further consent of such Grantor (any Grantor that
is an Issuer hereby acknowledges and agrees that this Security Agreement
constitutes an agreement in an authenticated record to so comply with such
instructions).

(d) The percentage of the issued and outstanding Capital Stock of each
Subsidiary pledged by each Grantor hereunder is as set forth on Schedule I.

SECTION 3.2 Grantor Name, Location, etc.

(a) The jurisdiction in which each Grantor is located for purposes of
Sections 9-301 and 9-307 of the UCC is set forth in Item A of Schedule II.

(b) Each location a secured party would have filed a UCC financing statement in
the five years prior to the date hereof to perfect a security interest in
Equipment, Inventory and General Intangibles owned by such Grantor is set forth
in Item B of Schedule II.

(c) The Grantors do not have any trade names other than those set forth in Item
C of Schedule II hereto.

(d) During the four months preceding the date hereof, no Grantor has been known
by any legal name different from the one set forth on the signature page hereto,
nor has such Grantor been the subject of any merger or other corporate
reorganization, except as set forth in Item D of Schedule II hereto.

(e) Each Grantor’s federal taxpayer identification number is (and, during the
four months preceding the date hereof, such Grantor has not had a federal
taxpayer identification number different from that) set forth in Item E of
Schedule II hereto.

(f) No Grantor is a party to any federal, state or local government contract
except as set forth in Item F of Schedule II hereto.

(g) No Grantor maintains any Deposit Accounts, Securities Accounts or Commodity
Accounts with any Person, in each case, except as set forth on Item G of
Schedule II.

(h) No Grantor is the beneficiary of any Letters of Credit (other than such as
is collateral for or issued subject to or in connection with the Company’s
existing accounts receivable securitization program), except as set forth on
Item H of Schedule II.

(i) No Grantor has Commercial Tort Claims except as set forth on Item I of
Schedule II.

(j) The name set forth on the signature page attached hereto is the true and
correct legal name (as defined in the UCC) of each Grantor.

(k) Each Grantor has obtained a legal, valid and enforceable consent of each
issuer of any Letter of Credit to the assignment of the Proceeds of such Letter
of Credit to the Collateral Agent and no Grantor has consented to, and is
otherwise aware of, any Person (other than the Collateral Agent pursuant hereto)
having control (within the meaning of Section 9-104 of the UCC) over, or any
other interest in any of such Grantor’s rights in respect thereof.

SECTION 3.3 Ownership, No Liens, etc. Each Grantor owns its Collateral free and
clear of any Lien, except for any security interest (a) created by this Security
Agreement and (b) in the case of Collateral other than the Capital Stock of each
Subsidiary pledged hereunder, that is a Permitted Lien. No effective UCC
financing statement or other filing similar in effect covering all or any part
of the Collateral is on file in any recording office, except those filed in
favor of the Collateral Agent relating to this Security Agreement or Permitted
Liens.

SECTION 3.4 Possession of Inventory, Control; etc.

(a) Except in the case of Dispositions permitted under the terms of the Credit
Agreement, and except for certain Collateral that is on consignment, each
Grantor has, and agrees that it will maintain, exclusive possession of its
Documents, Instruments, Promissory Notes, Goods, Equipment and Inventory, other
than (i) Equipment and Inventory in transit in the ordinary course of business,
(ii) except for Equipment or Inventory that is in the temporary possession of
another Person for purposes of being serviced, Equipment and Inventory that is
in the possession or control of a warehouseman, bailee agent or other Person
(other than a Person controlled by or under common control with any of the
Borrowers) that has been notified of the security interest created in favor of
the Secured Parties pursuant to this Security Agreement (and Grantor will use
its best efforts to have such third Person(s) authenticate a record
acknowledging that it holds possession of such Collateral for the Secured
Parties’ benefit and waives any Lien (other than Permitted Liens) held by it
against such Collateral, and (iii) Instruments or Promissory Notes that have
been delivered to the Collateral Agent pursuant to Section 3.5. In the case of
Equipment or Inventory described in clause (ii) above, no lessor or warehouseman
of any premises or warehouse upon or in which such Equipment or Inventory is
located has (i) issued to a Grantor any warehouse receipt or other receipt in
the nature of a warehouse receipt in respect of any such Equipment or Inventory,
(ii) issued to Grantor any Document for any such Equipment or Inventory,
(iii) to the knowledge of such Grantor without inquiry received notification of
any Secured Party’s interest (other than the security interest granted
hereunder) in any such Equipment or Inventory or (iv) any Lien on any such
Equipment or Inventory other than Permitted Liens.

(b) Each Grantor is the sole entitlement holder of its Accounts and no other
Person (other than the Collateral Agent pursuant to this Security Agreement or
any other Person with respect to Permitted Liens) has control or possession of,
or any other interest in, any of its Accounts or any other securities or
property credited thereto.

SECTION 3.5 Negotiable Documents, Instruments and Chattel Paper. Each Grantor
has delivered to the Collateral Agent possession of all originals of all
Documents, Instruments, Promissory Notes, and tangible Chattel Paper owned or
held by such Grantor on the Closing Date.

SECTION 3.6 Intellectual Property Collateral. Except as disclosed on Schedules
III through V, with respect to any material Intellectual Property Collateral
that is owned by a Grantor:

(a) such Intellectual Property Collateral is valid, subsisting, unexpired and
enforceable and has not been abandoned or adjudged invalid or unenforceable, in
whole or in part except as could not be expected to have a Material Adverse
Effect;

(b) such Grantor is the sole and exclusive owner of the entire and unencumbered
right, title and interest in and to such Intellectual Property Collateral and,
to Grantor’s knowledge without inquiry, no claim has been made that the use of
such Intellectual Property Collateral does or may, conflict with, infringe,
misappropriate, dilute, misuse or otherwise violate any of the rights of any
third party;

(c) such Grantor has made all necessary filings and recordations to protect its
interest in such Intellectual Property Collateral, including recordations of all
of its interests in the Patent Collateral and Trademark Collateral in the United
States Patent and Trademark Office and in corresponding offices throughout the
world, and its claims to the Copyright Collateral in the United States Copyright
Office and in corresponding offices throughout the world, and, to the extent
necessary, has used proper statutory notice in connection with its use of any
material patent, Trademark and copyright in any of the Intellectual Property
Collateral;

(d) such Grantor has taken reasonable steps to safeguard its Trade Secrets and
to its knowledge without inquiry (A) none of the Trade Secrets of such Grantor
has been used, divulged, disclosed or appropriated for the benefit of any other
Person other than such Grantor; (B) no employee, independent contractor or agent
of such Grantor has misappropriated any Trade Secrets of any other Person in the
course of the performance of his or her duties as an employee, independent
contractor or agent of such Grantor; and (C) no employee, independent contractor
or agent of such Grantor is in default or breach of any term of any employment
agreement, non-disclosure agreement, assignment of inventions agreement or
similar agreement or contract relating in any way to the protection, ownership,
development, use or transfer of such Grantor’s Intellectual Property Collateral;

(e) to such Grantor’s knowledge without inquiry, no third party is infringing
upon any Intellectual Property owned or used by such Grantor in any material
respect, or any of its respective licensees;

(f) no settlement or consents, covenants not to sue, nonassertion assurances, or
releases have been entered into by such Grantor or to which such Grantor is
bound that adversely affects its rights to own or use any Intellectual Property
except as would not have a Material Adverse Effect;

(g) such Grantor has not made a previous assignment, sale, transfer or agreement
constituting a present or future assignment, sale or transfer of any
Intellectual Property for purposes of granting a security interest or as
Collateral that has not been terminated or released

(h) such Grantor has executed and delivered to the Collateral Agent,
Intellectual Property Collateral security agreements for all copyrights, patents
and Trademarks owned by such Grantor, including all copyrights, patents and
trademarks on Schedule III through V (as such schedules may be amended or
supplemented from time to time);

(i) such 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 Trademarks and has taken commercially
reasonable action necessary to insure that all licensees of the Trademarks owned
by such Grantor use such adequate standards of quality;

(j) the consummation of the transactions contemplated by the Credit Agreement
and this Security Agreement will not result in the termination or material
impairment of any of the Intellectual Property Collateral; and

(k) such Grantor owns directly or is entitled to use by license or otherwise,
all Patents, Trademarks, Trade Secrets, Copyrights, mask works, licenses,
technology, know-how, processes and rights with respect to any of the foregoing
used in, necessary for or of importance to the conduct of such Grantor’s
business.

SECTION 3.7 Validity, etc.

(a) This Security Agreement creates a valid security interest in the Collateral
securing the payment of the Secured Obligations.

(b) Each Grantor has filed or caused to be filed all UCC-1 financing statements
in the filing office for each Grantor’s jurisdiction of organization listed in

Item A of Schedule II (collectively, the “Filing Statements”) (or has
authenticated and delivered to the Collateral Agent the Filing Statements
suitable for filing in such offices) and has taken all other:

(i) actions necessary to obtain control of the Collateral as provided in
Sections 9-104, 9-105, 9-106 and 9-107 of the UCC; and

(ii) actions necessary to perfect the Collateral Agent’s security interest with
respect to any Collateral evidenced by a certificate of ownership.

(c) Upon the filing of the Filing Statements with the appropriate agencies
therefor the security interests created under this Security Agreement shall
constitute a perfected security interest in the Collateral described on such
Filing Statements in favor of the Collateral Agent on behalf of the Secured
Parties to the extent that a security interest therein may be perfected by
filing pursuant to the relevant UCC, prior to all other Liens, except for
Permitted Liens (in which case such security interest shall be second in
priority of right only to the Permitted Liens until the obligations secured by
such Permitted Liens have been satisfied).

SECTION 3.8 Authorization, Approval, etc. Except as have been obtained or made
and are in full force and effect, no authorization, approval or other action by,
and no notice to or filing with, any Governmental Authority or any other third
party is required either

(a) for the grant by the Grantors of the security interest granted hereby or for
the execution, delivery and performance of this Security Agreement by the
Grantors;

(b) for the perfection or maintenance of the security interests hereunder
including the first priority (subject to Permitted Liens) nature of such
security interest (except with respect to the Filing Statements or, with respect
to Intellectual Property Collateral, the recordation of any agreements with the
U.S. Patent and Trademark Office or the U.S. Copyright Office) or the exercise
by the Collateral Agent of its rights and remedies hereunder; or

(c) for the exercise by the Collateral Agent of the voting or other rights
provided for in this Security Agreement, or, except (i) with respect to any
securities issued by a Subsidiary of the Grantors, as may be required in
connection with a disposition of such securities by laws affecting the offering
and sale of securities generally, the remedies in respect of the Collateral
pursuant to this Security Agreement and (ii) any “change of control” or similar
filings required by state licensing agencies.

SECTION 3.9 Best Interests. It is in the best interests of each Grantor (other
than the Borrowers) to execute this Security Agreement inasmuch as such Grantor
will, as a result of being a Subsidiary of the Company, derive substantial
direct and indirect benefits from the Loans and other extensions of credit made
from time to time to the Borrowers by the Lenders and each Issuer pursuant to
the Credit Agreement, and each Grantor agrees that the Secured Parties are
relying on this representation in agreeing to make such Loans and other
extensions of credit pursuant to the Credit Agreement to the Borrowers.

ARTICLE IV

COVENANTS

Each Grantor covenants and agrees that, until the Termination Date, such Grantor
will perform, comply with and be bound by the obligations set forth below.

SECTION 4.1 As to Investment Property, etc.

SECTION 4.1.1 Capital Stock of Subsidiaries. No Grantor will allow any of its
Subsidiaries, the Capital Stock of which is pledged hereunder:

(a) that is a corporation, business trust, joint stock company or similar
Person, to issue Uncertificated Securities;

(b) that is a partnership or limited liability company, to (i) issue Capital
Stock that are to be dealt in or traded on securities exchanges or in securities
markets,

(ii) expressly provide in its Organic Documents that its Capital Stock are
securities governed by Article 8 of the UCC, or (iii) place such Subsidiary’s
Capital Stock in a Securities Account; and

(c) to issue Capital Stock in addition to or in substitution for the Capital
Stock pledged hereunder, except to such Grantor (and such Capital Stock are
immediately pledged and delivered to the Collateral Agent pursuant to the terms
of this Security Agreement).

SECTION 4.1.2 Investment Property (other than Certificated Securities).

(a) With respect to any Deposit Accounts, Securities Accounts, Commodity
Accounts, Commodity Contracts or Security Entitlements constituting Investment
Property owned or held by any Grantor, such Grantor will use commercially
reasonable efforts to cause the intermediary maintaining such Investment
Property to execute a Control Agreement relating to such Investment Property
pursuant to which such intermediary agrees to comply with the Collateral Agent’s
instructions with respect to such Investment Property without further consent by
such Grantor.

(b) With respect to any Uncertificated Securities (other than Uncertificated
Securities credited to a Securities Account) constituting Investment Property
owned or held by any Grantor, such Grantor will use its commercially reasonable
efforts to cause the issuer of such securities to either (i) register the
Collateral Agent as the registered owner thereof on the books and records of the
issuer or (ii) execute a Control Agreement relating to such Investment Property
pursuant to which the issuer agrees to comply with the Collateral Agent’s
instructions with respect to such Uncertificated Securities without further
consent by such Grantor.

SECTION 4.1.3 Certificated Securities (Stock Powers). Each Grantor agrees that
all Certificated Securities, including the Capital Stock delivered by such
Grantor pursuant to this Security Agreement, will be accompanied by duly
executed undated blank stock powers, or other equivalent instruments of transfer
reasonably acceptable to the Collateral Agent.

SECTION 4.1.4 Continuous Pledge. Each Grantor will (subject to the terms of the
Credit Agreement) deliver to the Collateral Agent and at all times keep pledged
to the Collateral Agent pursuant hereto, on a first-priority, perfected basis
all Investment Property, all Dividends and Distributions with respect thereto,
all Payment Intangibles to the extent they are evidenced by a Document,
Instrument, Promissory Note or Chattel Paper, and all interest and principal
with respect to such Payment Intangibles, and all Proceeds and rights from time
to time received by or distributable to such Grantor in respect of any of the
foregoing Collateral. Each Grantor agrees that it will, promptly following
receipt thereof, deliver to the Collateral Agent possession of all originals of
negotiable Documents, Instruments, Promissory Notes and Chattel Paper that it
acquires following the date hereof.

SECTION 4.1.5 Voting Rights; Dividends, etc. Each Grantor agrees:

(a) promptly upon receipt of notice of the occurrence and continuance of a
Specified Default from the Collateral Agent and without any request therefor by
the Collateral Agent, so long as such Specified Default shall continue, to
deliver (properly endorsed where required hereby or requested by the Collateral
Agent) to the Collateral Agent all Dividends and Distributions with respect to
Investment Property, all interest, principal, other cash payments on Payment
Intangibles, and all Proceeds of the Collateral, in each case thereafter
received by such Grantor, all of which shall be held by the Collateral Agent as
additional Collateral; and

(b) with respect to Collateral consisting of general partner interests or
limited liability company interests, to promptly modify its Organic Documents to
admit the Collateral Agent as a general partner or member, as applicable,
immediately upon the occurrence and continuance of a Specified Default and so
long as the Collateral Agent has notified such Grantor of the Collateral Agent’s
intention to exercise its voting power under this clause,

(i) that the Collateral Agent may exercise (to the exclusion of such Grantor)
the voting power and all other incidental rights of ownership with respect to
any Investment Property constituting Collateral and such Grantor hereby grants
the Collateral Agent an irrevocable proxy, exercisable under such circumstances,
to vote such Investment Property; and

(ii) to promptly deliver to the Collateral Agent such additional proxies and
other documents as may be necessary to allow the Collateral Agent to exercise
such voting power.

All dividends, Distributions, interest, principal, cash payments, Payment
Intangibles and Proceeds that may at any time and from time to time be held by
such Grantor, but which such Grantor is then obligated to deliver to the
Collateral Agent, shall, until delivery to the Collateral Agent, be held by such
Grantor separate and apart from its other property in trust for the Collateral
Agent. The Collateral Agent agrees that unless a Specified Default shall have
occurred and be continuing and the Collateral Agent shall have given the notice
referred to in clause (b), such Grantor will have the exclusive voting power
with respect to any Investment Property constituting Collateral and the
Collateral Agent will, upon the written request of such Grantor, promptly
deliver such proxies and other documents, if any, as shall be reasonably
requested by such Grantor which are necessary to allow such Grantor to exercise
that voting power; provided that no vote shall be cast, or consent, waiver, or
ratification given, or action taken by such Grantor that would impair any such
Collateral or be inconsistent with or violate any provision of any Loan
Document.

SECTION 4.2 Change of Name, etc. No Grantor will change its name or place of
incorporation or organization or federal taxpayer identification number except
upon 30 days’ prior written notice to the Collateral Agent.

SECTION 4.3 As to Accounts.

(a) Each Grantor shall have the right to collect all Accounts so long as no
Specified Default shall have occurred and be continuing.

(b) Upon (i) the occurrence and continuance of a Specified Default and (ii) the
delivery of notice by the Collateral Agent to each Grantor, all Proceeds of
Collateral received by such Grantor shall be delivered in kind to the Collateral
Agent for deposit in a Deposit Account of such Grantor maintained with the
Collateral Agent (together with any other Accounts pursuant to which any portion
of the Collateral is deposited with the Collateral Agent, the “Collateral
Accounts”), and such Grantor shall not commingle any such Proceeds, and shall
hold separate and apart from all other property, all such Proceeds in express
trust for the benefit of the Collateral Agent until delivery thereof is made to
the Collateral Agent, except for proceeds which are or become subject to such
Grantor’s existing accounts receivable securitization program.

(c) Following the delivery of notice pursuant to clause (b)(ii), the Collateral
Agent shall have the right to apply any amount in the Collateral Account to the
payment of any Secured Obligations which are due and payable as it deems
appropriate.

(d) With respect to each of the Collateral Accounts, it is hereby confirmed and
agreed that (i) deposits in such Collateral Account are subject to a security
interest as contemplated hereby, (ii) such Collateral Account shall be under the
control of the Collateral Agent and (iii) the Collateral Agent shall have the
sole right of withdrawal over such Collateral Account.

SECTION 4.4 As to Grantors’ Use of Collateral.

(a) Subject to clause (b), each Grantor (i) may in the ordinary course of its
business, at its own expense, sell, lease or furnish under the contracts of
service any of the Inventory normally held by such Grantor for such purpose, and
use and consume, in the ordinary course of its business, any raw materials, work
in process or materials normally held by such Grantor for such purpose,
(ii) will, at its own expense, endeavor to collect, as and when due, all amounts
due with respect to any of the Collateral, including the taking of such action
with respect to such collection as the Collateral Agent may request following
the occurrence of a Specified Default or, in the absence of such request, as
such Grantor may deem reasonably advisable, and (iii) may grant, in the ordinary
course of business, to any party obligated on any of the Collateral, any rebate,
refund or allowance to which such party may be lawfully entitled, and may
accept, in connection therewith, the return of Goods, the sale or lease of which
shall have given rise to such Collateral.

(b) At any time following the occurrence and during the continuance of a
Specified Default, whether before or after the maturity of any of the Secured
Obligations, the Collateral Agent may (i) revoke any or all of the rights of
each Grantor set forth in clause (a), (ii) notify any parties obligated on any
of the Collateral to make payment to the Collateral Agent of any amounts due or
to become due thereunder and (iii) enforce collection of any of the Collateral
by suit or otherwise and surrender, release, or exchange all or any part
thereof, or compromise or extend or renew for any period (whether or not longer
than the original period) any indebtedness thereunder or evidenced thereby.

(c) Upon request of the Collateral Agent following the occurrence and during the
continuance of a Specified Default, each Grantor will, at its own expense,
notify any parties obligated on any of the Collateral to make payment to the
Collateral Agent of any amounts due or to become due thereunder.

(d) At any time following the occurrence and during the continuation of a
Specified Default, the Collateral Agent may endorse, in the name of such
Grantor, any item, howsoever received by the Collateral Agent, representing any
payment on or other Proceeds of any of the Collateral.

SECTION 4.5 As to Intellectual Property Collateral. Each Grantor covenants and
agrees to comply with the following provisions as such provisions relate to any
Intellectual Property Collateral material to the operations or business of such
Grantor:

(a) such Grantor will not (i) do or fail to perform any act whereby any of the
Patent Collateral may lapse or become abandoned or dedicated to the public or
unenforceable, (ii) permit any of its licensees to (A) fail to continue to use
any of the Trademark Collateral in order to maintain all of the Trademark
Collateral in full force free from any claim of abandonment for non-use,
(B) fail to maintain as in the past the quality of products and services offered
under all of the Trademark Collateral, (C) fail to employ all of the Trademark
Collateral registered with any federal or state or foreign authority with an
appropriate notice of such registration, (D) adopt or use any other Trademark
which is confusingly similar or a colorable imitation of any of the Trademark
Collateral, (E) use any of the Trademark Collateral registered with any federal,
state or foreign authority except for the uses for which registration or
application for registration of all of the Trademark Collateral has been made or
(F) do or permit any act or knowingly omit to do any act whereby any of the
Trademark Collateral may lapse or become invalid or unenforceable, or (iii) do
or permit any act or knowingly omit to do any act whereby any of the Copyright
Collateral or any of the Trade Secrets Collateral may lapse or become invalid or
unenforceable or placed in the public domain except upon expiration of the end
of an unrenewable term of a registration thereof, unless, in the case of any of
the foregoing requirements in clauses (i), (ii) and (iii), such Grantor shall
either (x) reasonably and in good faith determine that any of such Intellectual
Property Collateral is of negligible economic value to such Grantor, or (y) the
loss of the Intellectual Property Collateral would not have a Material Adverse
Effect on the business;

(b) such Grantor shall promptly notify the Collateral Agent if it knows, or has
reason to know, that any application or registration relating to any material
item of the Intellectual Property Collateral may become abandoned or dedicated
to the public or placed in the public domain or invalid or unenforceable, or of
any adverse determination or development (including the institution of, or any
such determination or development in, any proceeding in the United States Patent
and Trademark Office, the United States Copyright Office or any foreign
counterpart thereof or any court) regarding such Grantor’s ownership of any of
the Intellectual Property Collateral, its right to register the same or to keep
and maintain and enforce the same;

(c) in the event that a Grantor or any of its agents, employees, designees or
licensees files an application for the registration of any Intellectual Property
Collateral with the United States Patent and Trademark Office, the United States
Copyright Office or any similar office or agency in any other country or any
political subdivision thereof, it will promptly so inform the Collateral Agent,
and upon request of the Collateral Agent (subject to the terms of the Credit
Agreement), execute and deliver all agreements, instruments and documents as the
Collateral Agent may request to evidence the Collateral Agent’s security
interest in such Intellectual Property Collateral;

(d) such Grantor will take all necessary steps, including in any proceeding
before the United States Patent and Trademark Office, the United States
Copyright Office or (subject to the terms of the Credit Agreement) any similar
office or agency in any other country or any political subdivision thereof, to
maintain and pursue any application (and to obtain the relevant registration)
filed with respect to, and to maintain any registration of, the Intellectual
Property Collateral, including the filing of applications for renewal,
affidavits of use, affidavits of incontestability and opposition, interference
and cancellation proceedings and the payment of fees and taxes (except to the
extent that dedication, abandonment or invalidation is permitted under the
foregoing clause (a) or (b)); and

(e) such Grantor will promptly (but no less than twice annually) execute and
deliver to the Collateral Agent (as applicable) a Patent Security Agreement,
Trademark Security Agreement and/or Copyright Security Agreement, as the case
may be, in the forms of Exhibit A, Exhibit B and Exhibit C hereto following its
obtaining an interest in any such Intellectual Property, and shall execute and
deliver to the Collateral Agent any other document required to acknowledge or
register or perfect the Collateral Agent’s interest in any part of such item of
Intellectual Property Collateral unless such Grantor shall determine in good
faith (with the consent of the Collateral Agent) that any Intellectual Property
Collateral is of negligible economic value to such Grantor.

SECTION 4.6 As to Letter-of-Credit Rights.

(a) Each Grantor, by granting a security interest in its Letter-of-Credit Rights
(other than such as is collateral for or issued subject to or in connection with
the Borrowers’ existing accounts receivable securitization programs) to the
Collateral Agent, intends to (and hereby does) collaterally assign to the
Collateral Agent its rights (including its contingent rights ) to the Proceeds
of all Letter-of-Credit Rights of which it is or hereafter becomes a beneficiary
or assignee. Such Grantor will promptly use its commercially reasonable efforts
to cause the issuer of each Letter of Credit and each nominated person (if any)
with respect thereto to consent to such assignment of the Proceeds thereof in a
consent agreement in form and substance satisfactory to the Collateral Agent and
deliver written evidence of such consent to the Collateral Agent.

(b) Upon the occurrence of a Specified Default, such Grantor will, promptly upon
request by the Collateral Agent, (i) notify (and such Grantor hereby authorizes
the Collateral Agent to notify) the issuer and each nominated person with
respect to each of the Letters of Credit that the Proceeds thereof have been
assigned to the Collateral Agent hereunder and any payments due or to become due
in respect thereof are to be made directly to the Collateral Agent and
(ii) arrange for the Collateral Agent to become the transferee beneficiary
Letter of Credit.

SECTION 4.7 As to Commercial Tort Claims. Each Grantor covenants and agrees
that, until the payment in full of the Secured Obligations and termination of
all Commitments, with respect to any Commercial Tort Claim hereafter arising, it
shall deliver to the Collateral Agent a supplement in form and substance
satisfactory to the Collateral Agent, together with all supplements to schedules
thereto identifying such new Commercial Tort Claims.

SECTION 4.8 Electronic Chattel Paper and Transferable Records. If any Grantor at
any time holds or acquires an interest in any electronic chattel paper or any
“transferable record,” as that term is defined in Section 201 of the U.S.
Federal Electronic Signatures in Global and National Commerce Act, or in
Section 16 of the U.S. Uniform Electronic Transactions Act as in effect in any
relevant jurisdiction, with a value in excess of $1,000,000, such Grantor shall
promptly notify the Collateral Agent thereof and, at the request of the
Collateral Agent, shall take such action as the Collateral Agent may request to
vest in the Collateral Agent control under Section 9-105 of the U.C.C. of such
electronic chattel paper or control under Section 201 of the Federal Electronic
Signatures in Global and National Commerce Act or, as the case may be, Section
16 of the Uniform Electronic Transactions Act, as so in effect in such
jurisdiction, of such transferable record. The Collateral Agent agrees with such
Grantor that the Collateral Agent will arrange, pursuant to procedures
satisfactory to the Collateral Agent and so long as such procedures will not
result in the Collateral Agent’s loss of control, for the Grantor to make
alterations to the electronic chattel paper or transferable record permitted
under Section 9-105 of the U.C.C. or, as the case may be, Section 201 of the
U.S. Federal Electronic Signatures in Global and National Commerce Act or
Section 16 of the U.S. Uniform Electronic Transactions Act for a party in
control to allow without loss of control, unless an Event of Default has
occurred and is continuing or would occur after taking into account any action
by such Grantor with respect to such electronic chattel paper or transferable
record.

SECTION 4.9 Further Assurances, etc. Each Grantor agrees that, from time to time
at its own expense, it will promptly execute and deliver all further instruments
and documents, and take all further action, that may be necessary or that the
Collateral Agent may request, in order to perfect, preserve and protect any
security interest granted or purported to be 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,
such Grantor will

(a) from time to time upon the request of the Collateral Agent, promptly deliver
to the Collateral Agent such stock powers, instruments and similar documents,
satisfactory in form and substance to the Collateral Agent, with respect to such
Collateral as the Collateral Agent may request and will, from time to time upon
the request of the Collateral Agent, after the occurrence and during the
continuance of any Specified Default, promptly transfer any securities
constituting Collateral into the name of any nominee designated by the
Collateral Agent; if any Collateral shall be evidenced by an Instrument,
negotiable Document, Promissory Note or tangible Chattel Paper, deliver and
pledge to the Collateral Agent hereunder such Instrument, negotiable Document,
Promissory Note or tangible Chattel Paper duly endorsed and accompanied by duly
executed instruments of transfer or assignment, all in form and substance
satisfactory to the Collateral Agent;

(b) file (and hereby authorize the Collateral Agent to file) such Filing
Statements or continuation statements, or amendments thereto, and such other
instruments or notices (including any assignment of claim form under or pursuant
to the federal assignment of claims statute, 31 U.S.C. § 3726, any successor or
amended version thereof or any regulation promulgated under or pursuant to any
version thereof), as may be necessary or that the Collateral Agent may request
in order to perfect and preserve the security interests and other rights granted
or purported to be granted to the Collateral Agent hereby;

(c) deliver to the Collateral Agent and at all times keep pledged to the
Collateral Agent pursuant hereto, on a first-priority, perfected basis, at the
request of the Collateral Agent, all Investment Property constituting
Collateral, all Distributions with respect thereto, and all interest and
principal with respect to Promissory Notes, and all Proceeds and rights from
time to time received by or distributable to such Grantor in respect of any of
the foregoing Collateral;

(d) not take or omit to take any action the taking or the omission of which
would result in any impairment or alteration of any obligation of the maker of
any Payment Intangible or other Instrument constituting Collateral, except as
provided in Section 4.4;

(e) not create any tangible Chattel Paper without placing a legend on such
tangible Chattel Paper acceptable to the Collateral Agent indicating that the
Collateral Agent has a security interest in such Chattel Paper;

(f) furnish to the Collateral Agent, from time to time at the Collateral Agent’s
request, statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral as the
Collateral Agent may request, all in reasonable detail; and

(g) do all things requested by the Collateral Agent in accordance with this
Security Agreement in order to enable the Collateral Agent to have and maintain
control over the Collateral consisting of Investment Property, Deposit Accounts,
Letter-of-Credit-Rights and Electronic Chattel Paper.

With respect to the foregoing and the grant of the security interest hereunder,
each Grantor hereby authorizes the Collateral Agent to file one or more
financing or continuation statements, and amendments thereto, relative to all or
any part of the Collateral. Each Grantor agrees that a carbon, photographic or
other reproduction of this Security Agreement or any UCC financing statement
covering the Collateral or any part thereof shall be sufficient as a UCC
financing statement where permitted by law. Each Grantor hereby authorizes the
Collateral Agent to file financing statements describing as the collateral
covered thereby “all of the debtor’s personal property or assets” or words to
that effect, notwithstanding that such wording may be broader in scope than the
Collateral described in this Security Agreement.

SECTION 4.10 Deposit Accounts. Following the occurrence and during the
continuance of a Specified Default, at the request of the Collateral Agent or
the Required Lenders, such Grantor will maintain all of its Deposit Accounts
only with the Collateral Agent or with any depositary institution that has
entered into a Control Agreement in favor of the Collateral Agent.

ARTICLE V

THE COLLATERAL AGENT

SECTION 5.1 Collateral Agent Appointed Attorney-in-Fact. Each Grantor hereby
irrevocably appoints the Collateral Agent its attorney-in-fact, with full
authority in the place and stead of such Grantor and in the name of such Grantor
or otherwise, from time to time in the Collateral Agent’s discretion, following
the occurrence and during the continuance of a Specified Default, to take any
action and to execute any instrument which the Collateral Agent may deem
necessary or reasonably advisable to accomplish the purposes of this Security
Agreement, including:

(a) to ask, demand, collect, sue for, recover, compromise, receive and give
acquittance and receipts for moneys due and to become due under or in respect of
any of the Collateral;

(b) to receive, endorse, and collect any drafts or other Instruments, Documents
and Chattel Paper, in connection with clause (a) above;

(c) to file any claims or take any action or institute any proceedings which 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; and

(d) to perform the affirmative obligations of such Grantor hereunder.

Each Grantor hereby acknowledges, consents and agrees that the power of attorney
granted pursuant to this Section is irrevocable and coupled with an interest.

SECTION 5.2 Collateral Agent May Perform. 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 such Grantor pursuant to
Section 10.3 of the Credit Agreement.

SECTION 5.3 Collateral Agent Has No Duty. The powers conferred on the Collateral
Agent hereunder are solely to protect its interest (on behalf of the Secured
Parties) in the Collateral and shall not impose any duty on it to exercise any
such powers. Except for reasonable care 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 responsibility for

(a) ascertaining or taking action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relative to any Investment Property,
whether or not the Collateral Agent has or is deemed to have knowledge of such
matters, or

(b) taking any necessary steps to preserve rights against prior parties or any
other rights pertaining to any Collateral.

SECTION 5.4 Reasonable Care. The Collateral Agent is required to exercise
reasonable care in the custody and preservation of any of the Collateral in its
possession; provided that the Collateral Agent shall be deemed to have exercised
reasonable care in the custody and preservation of any of the Collateral, if it
takes such action for that purpose as each Grantor reasonably requests in
writing at times other than upon the occurrence and during the continuance of
any Specified Default, but failure of the Collateral Agent to comply with any
such request at any time shall not in itself be deemed a failure to exercise
reasonable care.

ARTICLE VI

REMEDIES

SECTION 6.1 Certain Remedies. If any Specified Default shall have occurred and
be continuing:

(a) The Collateral Agent may exercise in respect of the Collateral, in addition
to other rights and remedies provided for herein or otherwise available to it,
all the rights and remedies of a Secured Party on default under the UCC (whether
or not the UCC applies to the affected Collateral) and also may

(i) take possession of any Collateral not already in its possession without
demand and without legal process;

(ii) require each Grantor to, and each Grantor hereby agrees that it will, at
its expense and 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,

(iii) enter onto the property where any Collateral is located and take
possession thereof without demand and without legal process;

(iv) without notice except as specified below, lease, license, sell 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, and upon such other terms as the
Collateral Agent may deem commercially reasonable. Each Grantor agrees that, to
the extent notice of sale shall be required by law, at least ten days’ prior
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.

(b) All cash Proceeds received by the Collateral Agent in respect of any sale
of, collection from, or other realization upon, all or any part of the
Collateral shall be applied by the Collateral Agent against, all or any part of
the Secured Obligations as set forth in Section 4.7 of the Credit Agreement.

(c) The Collateral Agent may

(i) transfer all or any part of the Collateral into the name of the Collateral
Agent or its nominee, with or without disclosing that such Collateral is subject
to the Lien hereunder,

(ii) notify the parties obligated on any of the Collateral to make payment to
the Collateral Agent of any amount due or to become due thereunder,

(iii) withdraw, or cause or direct the withdrawal, of all funds with respect to
the Collateral Account;

(iv) enforce collection of any of the Collateral by suit or otherwise, and
surrender, release or exchange all or any part thereof, or compromise or extend
or renew for any period (whether or not longer than the original period) any
obligations of any nature of any party with respect thereto,

(v) endorse any checks, drafts, or other writings in any Grantor’s name to allow
collection of the Collateral,

(vi) take control of any Proceeds of the Collateral, and

(vii) execute (in the name, place and stead of any Grantor) endorsements,
assignments, stock powers and other instruments of conveyance or transfer with
respect to all or any of the Collateral.

SECTION 6.2 Securities Laws. If the Collateral Agent shall determine to exercise
its right to sell all or any of the Collateral that are Capital Stock pursuant
to Section 6.1, each Grantor agrees that, upon request of the Collateral Agent,
each Grantor will, at its own expense:

(a) execute and deliver, and cause (or, with respect to any issuer which is not
a Subsidiary of such Grantor, use commercially reasonable efforts to cause) each
issuer of the Collateral contemplated to be sold and the directors and officers
thereof to execute and deliver, all such instruments and documents, and do or
cause to be done all such other acts and things, as may be necessary or, in the
opinion of the Collateral Agent, reasonably advisable to register such
Collateral under the provisions of the Securities Act of 1933, as from time to
time amended (the “Securities Act”), and cause the registration statement
relating thereto to become effective and to remain effective for such period as
prospectuses are required by law to be furnished, and to make all amendments and
supplements thereto and to the related prospectus which, in the opinion of the
Collateral Agent, are necessary or reasonably advisable, all in conformity with
the requirements of the Securities Act and the rules and regulations of the SEC
applicable thereto, or use its commercially reasonable efforts to exempt the
Collateral under the state securities or “Blue Sky” laws and to obtain all
necessary governmental approvals for the sale of the Collateral, as requested by
the Collateral Agent;

(b) if necessary in order to effectuate such a registration or exemption, cause
(or, with respect to any issuer that is not a Subsidiary of such Grantor, use
its commercially reasonable efforts to cause) each such issuer to make available
to its security holders, as soon as practicable, an earnings statement that will
satisfy the provisions of Section 11(a) of the Securities Act; and

(c) do or cause to be done all such other acts and things as may be necessary to
make such sale of the Collateral or any part thereof valid and binding and in
compliance with applicable law.

(d) Each Grantor acknowledges the impossibility of ascertaining the amount of
damages that would be suffered by the Collateral Agent or the Secured Parties by
reason of the failure by such Grantor to perform any of the covenants contained
in this Section and consequently agrees that, if such Grantor shall fail to
perform any of such covenants, it shall pay, as liquidated damages and not as a
penalty, an amount equal to the value (as determined by the Collateral Agent) of
such Collateral on the date the Collateral Agent shall demand compliance with
this Section.

SECTION 6.3 Compliance with Restrictions. Each Grantor agrees that in any sale
of any of the Collateral whenever a Specified Default shall have occurred and be
continuing, the Collateral Agent is hereby authorized to comply with any
limitation or restriction in connection with such sale as it may be advised by
counsel is necessary in order to avoid any violation of any right(s) of any
third Person or applicable law (including compliance with such procedures as may
restrict the number of prospective bidders and purchasers, require that such
prospective bidders and purchasers have certain qualifications, and restrict
such prospective bidders and purchasers to Persons who will represent and agree
that they are purchasing for their own account for investment and not with a
view to the distribution or resale of such Collateral), or in order to obtain
any required approval of the sale or of the purchaser by any third Person or any
Governmental Authority or official, and such Grantor further agrees that such
compliance shall not result in such sale being considered or deemed not to have
been made in a commercially reasonable manner, nor shall the Collateral Agent be
liable nor accountable to such Grantor for any discount allowed by the reason of
the fact that such Collateral is sold in compliance with any such limitation or
restriction.

SECTION 6.4 Protection of Collateral. The Collateral Agent may from time to
time, at its option, perform any act which any Grantor fails to perform after
being requested in writing so to perform (it being understood that no such
request need be given after the occurrence and during the continuance of a
Specified Default) and the Collateral Agent may from time to time take any other
action which the Collateral Agent deems necessary for the maintenance,
preservation or protection of any of the Collateral or of its security interest
therein.

ARTICLE VII

MISCELLANEOUS PROVISIONS

SECTION 7.1 Loan Document. This Security Agreement is a Loan Document executed
pursuant to the Credit Agreement and shall (unless otherwise expressly indicated
herein) be construed, administered and applied in accordance with the terms and
provisions thereof, including each Section thereof.

SECTION 7.2 Binding on Successors, Transferees and Assigns; Assignment. This
Security Agreement shall remain in full force and effect until the Termination
Date has occurred, shall be binding upon the Grantors and their successors,
transferees and assigns and shall inure to the benefit of and be enforceable by
each Secured Party and its successors, transferees and assigns; provided that no
Grantor may (unless otherwise permitted under the terms of the Credit Agreement
or this Security Agreement) assign any of its obligations hereunder without the
prior written consent of all Lenders.

SECTION 7.3 Amendments, etc. No amendment to or waiver of any provision of this
Security Agreement, nor consent to any departure by any Grantor from its
obligations under this Security Agreement, shall in any event be effective
unless the same shall be in writing and signed by the Collateral Agent (on
behalf of the Lenders or the Required Lenders, as the case may be, pursuant to
Section 10.1 of the Credit Agreement) and the Grantors and then such waiver or
consent shall be effective only in the specific instance and for the specific
purpose for which given.

SECTION 7.4 Notices. All notices and other communications provided for hereunder
shall be in writing or by facsimile and addressed, delivered or transmitted to
the appropriate party at the address or facsimile number of such party specified
in the Credit Agreement or at such other address or facsimile number as may be
designated by such party in a notice to the other party. Any notice or other
communication, if mailed and properly addressed with postage prepaid or if
properly addressed and sent by pre-paid courier service, shall be deemed given
when received; any such notice or other communication, if transmitted by
facsimile, shall be deemed given when transmitted and electronically confirmed.

SECTION 7.5 Release of Liens. Upon (a) the Disposition of Collateral in
accordance with the Credit Agreement or (b) the occurrence of the Termination
Date, the security interests granted herein shall automatically terminate with
respect to (i) such Collateral (in the case of clause (a)) or (ii) all
Collateral (in the case of clause (b)). Upon any such Disposition or
termination, the Collateral Agent will, at the Grantors’ sole expense, deliver
to the Grantors, without any representations, warranties or recourse of any kind
whatsoever, all Collateral held by the Collateral Agent hereunder, and execute
and deliver to the Grantors such documents as the Grantors shall reasonably
request to evidence such termination.

SECTION 7.6 Additional Grantors. Upon the execution and delivery by any other
Person of a supplement in the form of Annex I hereto, such Person shall become a
“Grantor” hereunder with the same force and effect as if it were originally a
party to this Security Agreement and named as a “Grantor” hereunder. The
execution and delivery of such supplement shall not require the consent of any
other Grantor hereunder, and the rights and obligations of each Grantor
hereunder shall remain in full force and effect notwithstanding the addition of
any new Grantor as a party to this Security Agreement.

SECTION 7.7 No Waiver; Remedies. In addition to, and not in limitation of
Section 2.5, no failure on the part of any Secured Party to exercise, and no
delay in exercising, any right hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any right hereunder preclude any other
or further exercise thereof or the exercise of any other right. The remedies
herein provided are cumulative and not exclusive of any remedies provided by
law.

SECTION 7.8 Headings. The various headings of this Security Agreement are
inserted for convenience only and shall not affect the meaning or interpretation
of this Security Agreement or any provisions thereof.

SECTION 7.9 Severability. Any provision of this Security Agreement which is
prohibited or unenforceable in any jurisdiction shall, as to such provision and
such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Security
Agreement or affecting the validity or enforceability of such provision in any
other jurisdiction.

SECTION 7.10 Governing Law, Entire Agreement, etc. THIS SECURITY AGREEMENT SHALL
BE DEEMED TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE
GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), EXCEPT TO THE EXTENT THAT THE
PERFECTION, EFFECT OF PERFECTION OR NONPERFECTION, AND PRIORITY OF THE SECURITY
INTEREST HEREUNDER, OR REMEDIES HEREUNDER, IN RESPECT OF ANY PARTICULAR
COLLATERAL ARE GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF
NEW YORK. This Security Agreement and the other Loan Documents constitute the
entire understanding among the parties hereto with respect to the subject matter
hereof and thereof and supersede any prior agreements, written or oral, with
respect thereto.

SECTION 7.11 Counterparts. This Security Agreement may be executed by the
parties hereto in several counterparts, each of which shall be deemed to be an
original and all of which shall constitute together but one and the same
agreement. Delivery of an executed counterpart of a signature page to this
Security Agreement by facsimile shall be effective as delivery of a manually
executed counterpart of this Security Agreement.

SECTION 7.12 Collateral Sharing Agreement. Notwithstanding anything herein to
the contrary, the lien and security interest granted to the Collateral Agent
pursuant to this Security Agreement and the exercise of any right or remedy by
the Collateral Agent hereunder are subject to the provisions of the Collateral
Sharing Agreement. In the event of any conflict between the terms of the
Collateral Sharing Agreement and this Security Agreement, the terms of the
Collateral Sharing Agreement shall govern.

1

IN WITNESS WHEREOF, each of the parties hereto has caused this Security
Agreement to be duly executed and delivered by its Authorized Officer as of the
date first above written.

FERRO CORPORATION

      By:

Name: Thomas M. Gannon
Title: Chief Financial Officer

FERRO ELECTRONIC MATERIALS INC.

      By:      

Name: Rhonda S. Ferguson
Title: Assistant Secretary

FERRO PFANSTIEHL LABORATORIES, INC.

      By:      

Name: Rhonda S. Ferguson
Title: Assistant Secretary

FERRO COLOR & GLASS CORPORATION

      By:      

Name: Rhonda S. Ferguson
Title: Secretary

FERRO INTERNATIONAL SERVICES INC.

      By:      

Name: Rhonda S. Ferguson
Title: Secretary

FERRO CHINA HOLDINGS INC.

      By:      

Name: Rhonda S. Ferguson
Title: Secretary

2

NATIONAL CITY BANK,
as Collateral Agent

      By:      

Name:
Title:

3

SCHEDULE I

to Security Agreement

                     
 
                   
 
                    Name of Grantor:            

 
                                Common Stock

 
                                 

 
                   
Issuer (corporate)
  Cert. #   # of Shares   Authorized
Shares   Outstanding
Shares  
% of Shares Pledged
 
                   

                          Limited Liability Company Interests Issuer (limited  
% of Limited Liability   Type of Limited Liability liability company)   Company
Interests   Company Interests Pledged         Pledged        

                        Partnership Interests Issuer (partnership)     % of
Partnership   % of Partnership       Interests Owned   Interests Pledged

4

SCHEDULE II

to Security Agreement

Item A.   Location of each Grantor.

     
Name of Grantor:
  Location for purposes of UCC:
 
   
 
   
[GRANTOR]
  [LOCATION]
 
   

Item B.   Filing locations last five years.

     
Name of Grantor:
  Filing locations last five years
 
   
 
   
[GRANTOR]
  [LOCATION]
 
   

Item C.   Trade names.

     
Name of Grantor:
  Trade Names:
 
   
 
   
[GRANTOR]
 

 
 

Item D.   Merger or other corporate reorganization.

     
Name of Grantor:
  Merger or other corporate reorganization:
 
   
 
   
[GRANTOR]
 

 
 

Item E.   Taxpayer ID numbers.

     
Name of Grantor:
  Taxpayer ID numbers:
 
   
 
   
[GRANTOR]
 

 
 

Item F. Government Contracts.

     
Name of Grantor:
  Description of Contract:
 
   
 
   
[GRANTOR]
 

 
 

Item G. Deposit Accounts and Securities Accounts.

     
Name of Grantor:
  Description of Deposit Accounts and Securities
Accounts:
 
   
 
   
[GRANTOR]
 

 
 

Item H. Letter of Credit Rights.

     
Name of Grantor:
  Description of Letter of Credit Rights:
 
   
 
   
[GRANTOR]
 

 
 

Item I. Commercial Tort Claims.

     
Name of Grantor:
  Description of Commercial Tort Claims:
 
   
 
   
[GRANTOR]
 

 
 

 
   

5

SCHEDULE III

to Security Agreement

Item A. Patents

                                                  Issued Patents         Country
  Patent No.   Issue Date   Inventor(s)   Title

Pending Patent Applications

                                  Country   Serial No.   Filing Date  
Inventor(s)   Title

Patent Applications In Preparation

                                                  Expected         Country  
Docket No.   Filing Date   Inventor(s)   Title

Item B. Patent Licenses

                     
Country or
          Effective   Expiration   Subject
 
                   
Territory
  Licensor   Licensee      Date        Date     Matter
 
                   
 
                   

6

SCHEDULE IV

to Security Agreement

Item A. Trademarks

                  Registered Trademarks
   
 
             

 
           
Country
  Trademark   Registration No.   Registration Date
 
           

Pending Trademark Applications

             
Country
  Trademark   Serial No.   Filing Date
 
           

Trademark Applications In Preparation

                                                          Expected   Products/
Country   Trademark   Docket No.   Filing Date   Services

Item B. Trademark Licenses

                                          Country or                          
Effective   Expiration Territory   Trademark   Licensor   Licensee      Date    
   Date   

7

SCHEDULE V

to Security Agreement

Item A. Copyrights/Mask Works

Registered Copyrights/Mask Works

Country Registration No. Registration Date Author(s) Title

Copyright/Mask Work Pending Registration Applications

Country Serial No. Filing Date Author(s) Title

Copyright/Mask Work Registration Applications In Preparation

Expected

Country Docket No. Filing Date Author(s) Title

Item B. Copyright/Mask Work Licenses

8

SCHEDULE VI

to Security Agreement

Trade Secret or Know-How Licenses

9

EXHIBIT A

to Security Agreement

PATENT SECURITY AGREEMENT

This PATENT SECURITY AGREEMENT, dated as of      , 200     (this “Agreement”),
is made by [NAME OF GRANTOR], a      (the “Grantor”), in favor of NATIONAL CITY
BANK, as the collateral agent (together with its successor(s) thereto in such
capacity, the “Collateral Agent”) for each of the Secured Parties.

W I T N E S S E T H :

WHEREAS, this Agreement is made pursuant to the Credit Agreement, dated as of
June 6, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Credit Agreement”), among the Borrowers, the
various financial institutions and other Persons from time to time party thereto
(the “Lenders”), the Credit Suisse, Cayman Islands Branch, as the Term Loan
Administrative Agent, National City as the Revolving Loan Administrative Agent
and the Collateral Agent, and Keybank National Association, as the Documentation
Agent;

WHEREAS, in connection with the Credit Agreement, the Grantor has executed and
delivered a Pledge and Security Agreement, dated as of June 6, 2006 (as amended,
supplemented, amended and restated or otherwise modified from time to time, the
“Security Agreement”);

WHEREAS, pursuant to the Credit Agreement and pursuant to clause (e) of
Section 4.5 of the Security Agreement, the Grantor is required to execute and
deliver this Agreement and to grant to the Collateral Agent a continuing
security interest in all of the Patent Collateral (as defined below) to secure
all Secured Obligations; and

WHEREAS, the Grantor has duly authorized the execution, delivery and performance
of this Agreement; and

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Grantor agrees, for the benefit of each
Secured Party, as follows:

SECTION 1. Definitions. Unless otherwise defined herein or the context otherwise
requires, terms used in this Agreement, including its preamble and recitals,
have the meanings provided in the Security Agreement.

SECTION 2. Grant of Security Interest. The Grantor hereby assigns, pledges,
hypothecates, charges, mortgages, delivers, and transfers to the Collateral
Agent, for its benefit and the ratable benefit of each other Secured Party, and
hereby grants to the Collateral Agent, for its benefit and the ratable benefit
of each other Secured Party, a continuing security interest in all of the
following property, whether now or hereafter existing or acquired by the Grantor
(the “Patent Collateral”):

(a) all of its letters patent and applications for letters patent throughout the
world, including all patent applications in preparation for filing and each
patent and patent application referred to in Item A of Schedule I attached
hereto;

(b) all reissues, divisions, continuations, continuations-in-part, extensions,
renewals and reexaminations of any of the items described in clause (a);

(c) all of its patent licenses, and other agreements providing the Grantor with
the right to use any items of the type referred to in clauses (a) and (b) above,
including each patent license referred to in Item B of Schedule I attached
hereto; and

(d) all Proceeds of, and rights associated with, the foregoing (including
license royalties and Proceeds of infringement suits), the right to sue third
parties for past, present or future infringements of any patent or patent
application, and for breach or enforcement of any patent license.

SECTION 3. Security Agreement. This Agreement has been executed and delivered by
the Grantor for the purpose of registering the security interest of the
Collateral Agent in the Patent Collateral with the United States Patent and
Trademark Office and corresponding offices in other countries of the world. The
security interest granted hereby has been granted as a supplement to, and not in
limitation of, the security interest granted to the Collateral Agent for its
benefit and the ratable benefit of each other Secured Party under the Security
Agreement. The Security Agreement (and all rights and remedies of the Collateral
Agent and each Secured Party thereunder) shall remain in full force and effect
in accordance with its terms.

SECTION 4. Release of Liens. Upon (i) the Disposition of Patent Collateral in
accordance with the Credit Agreement or (ii) the occurrence of the Termination
Date, the security interests granted herein shall automatically terminate with
respect to (A) such Patent Collateral (in the case of clause (i)) or (B) all
Patent Collateral (in the case of clause (ii)). Upon any such Disposition or
termination, the Collateral Agent will, at the Grantor’s sole expense, deliver
to the Grantor, without any representations, warranties or recourse of any kind
whatsoever, all Patent Collateral held by the Collateral Agent hereunder, and
execute and deliver to the Grantor such Documents as the Grantor shall
reasonably request to evidence such termination.

SECTION 5. Acknowledgment. The Grantor does hereby further acknowledge and
affirm that the rights and remedies of the Collateral Agent with respect to the
security interest in the Patent Collateral granted hereby are more fully set
forth in the Security Agreement, the terms and provisions of which (including
the remedies provided for therein) are incorporated by reference herein as if
fully set forth herein.

SECTION 6. Loan Document. This Agreement is a Loan Document executed pursuant to
the Credit Agreement and shall (unless otherwise expressly indicated herein) be
construed, administered and applied in accordance with the terms and provisions
thereof, including Article X thereof.

SECTION 7. Counterparts. This Agreement may be executed by the parties hereto in
several counterparts, each of which shall be deemed to be an original and all of
which shall constitute together but one and the same agreement.

* * * * *

10

IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
duly executed and delivered as of the date first above written.

[NAME OF GRANTOR]

      By:      

Name:
Title:

NATIONAL CITY BANK,
as Collateral Agent

      By:      

Name:
Title:

11

SCHEDULE I

to Patent Security Agreement

                                  Item A. Patents             Issued Patents    
        Country   Patent No.   Issue Date   Inventor(s)   Title

Pending Patent Applications

Country Serial No. Filing Date Inventor(s) Title

Patent Applications in Preparation

                                                  Expected         Country  
Docket No.   Filing Date   Inventor(s)   Title

                      Item B. Patent Licenses
               
 
                     
               
 
                   
Country or
Territory
  Licensor   Licensee   Effective
    Date       Expiration
     Date       Subject
Matter
 
                   

12

EXHIBIT B

to Security Agreement

TRADEMARK SECURITY AGREEMENT

This TRADEMARK SECURITY AGREEMENT, dated as of      , 200     (this
“Agreement”), is made by [NAME OF GRANTOR], a      (the “Grantor”), in favor of
NATIONAL CITY BANK, as the collateral agent (together with its successor(s)
thereto in such capacity, the “Collateral Agent”) for each of the Secured
Parties.

W I T N E S S E T H :

WHEREAS, this Agreement is made pursuant to the Credit Agreement, dated as of
June 6, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Credit Agreement”), among the Borrowers, the
various financial institutions and other Persons from time to time party thereto
(the “Lenders”), the Credit Suisse, Cayman Islands Branch, as the Term Loan
Administrative Agent, National City as the Revolving Loan Administrative Agent
and the Collateral Agent, and Keybank National Association, as the Documentation
Agent;

WHEREAS, in connection with the Credit Agreement, the Grantor has executed and
delivered a Pledge and Security Agreement, dated as of June 6, 2006 (as amended,
supplemented, amended and restated or otherwise modified from time to time, the
“Security Agreement”);

WHEREAS, pursuant to the Credit Agreement and pursuant to clause (e) of
Section 4.5 of the Security Agreement, the Grantor is required to execute and
deliver this Agreement and to grant to the Collateral Agent a continuing
security interest in all of the Trademark Collateral (as defined below) to
secure all Secured Obligations; and

WHEREAS, the Grantor has duly authorized the execution, delivery and performance
of this Agreement; and

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Grantor agrees, for the benefit of each
Secured Party, as follows:

SECTION 1. Definitions. Unless otherwise defined herein or the context otherwise
requires, terms used in this Agreement, including its preamble and recitals,
have the meanings provided in the Security Agreement.

SECTION 2. Grant of Security Interest. The Grantor hereby assigns, pledges,
hypothecates, charges, mortgages, delivers, and transfers to the Collateral
Agent, for its benefit and the ratable benefit of each other Secured Party, and
hereby grants to the Collateral Agent, for its benefit and the ratable benefit
of each other Secured Party, a continuing security interest in all of the
following property, whether now or hereafter existing or acquired by the Grantor
(the “Trademark Collateral”):

(a) (i) all of its Trademarks, trade names, corporate names, company names,
business names, fictitious business names, trade styles, service marks,
certification marks, collective marks, logos and other source or business
identifiers, and all goodwill of the business associated therewith, now existing
or hereafter adopted or acquired including those referred to in Item A of
Schedule I hereto, whether currently in use or not, all registrations and
recordings thereof and all applications in connection therewith, whether pending
or in preparation for filing, including registrations, recordings and
applications in the United States Patent and Trademark Office or in any office
or agency of the United States of America or any State thereof or any other
country or political subdivision thereof or otherwise, and all common-law rights
relating to the foregoing, and (ii) the right to obtain all reissues, extensions
or renewals of the foregoing (collectively referred to as the “Trademark”);

(b) all Trademark licenses for the grant by or to the Grantor of any right to
use any Trademark, including each Trademark license referred to in Item B of
Schedule I hereto;

(c) all of the goodwill of the business connected with the use of, and
symbolized by the items described in, clause (a), and to the extent applicable
clause (b);

(d) the right to sue third parties for past, present and future infringements of
any Trademark Collateral described in clause (a) and, to the extent applicable,
clause (b); and

(e) all Proceeds of, and rights associated with, the foregoing, including any
claim by the Grantor against third parties for past, present or future
infringement or dilution of any Trademark, Trademark registration or Trademark
license, or for any injury to the goodwill associated with the use of any such
Trademark or for breach or enforcement of any Trademark license and all rights
corresponding thereto throughout the world.

SECTION 3. Security Agreement. This Agreement has been executed and delivered by
the Grantor for the purpose of registering the security interest of the
Collateral Agent in the Trademark Collateral with the United States Patent and
Trademark Office and corresponding offices in other countries of the world. The
security interest granted hereby has been granted as a supplement to, and not in
limitation of, the security interest granted to the Collateral Agent for its
benefit and the ratable benefit of each other Secured Party under the Security
Agreement. The Security Agreement (and all rights and remedies of the Collateral
Agent and each Secured Party thereunder) shall remain in full force and effect
in accordance with its terms.

SECTION 4. Release of Liens. Upon (i) the Disposition of Trademark Collateral in
accordance with the Credit Agreement or (ii) the occurrence of the Termination
Date, the security interests granted herein shall automatically terminate with
respect to (A) such Trademark Collateral (in the case of clause (i)) or (B) all
Trademark Collateral (in the case of clause (ii)). Upon any such Disposition or
termination, the Collateral Agent will, at the Grantor’s sole expense, deliver
to the Grantor, without any representations, warranties or recourse of any kind
whatsoever, all Trademark Collateral held by the Collateral Agent hereunder, and
execute and deliver to the Grantor such Documents as the Grantor shall
reasonably request to evidence such termination.

SECTION 5. Acknowledgment. The Grantor does hereby further acknowledge and
affirm that the rights and remedies of the Collateral Agent with respect to the
security interest in the Trademark Collateral granted hereby are more fully set
forth in the Security Agreement, the terms and provisions of which (including
the remedies provided for therein) are incorporated by reference herein as if
fully set forth herein.

SECTION 6. Loan Document. This Agreement is a Loan Document executed pursuant to
the Credit Agreement and shall (unless otherwise expressly indicated herein) be
construed, administered and applied in accordance with the terms and provisions
thereof, including Article X thereof.

SECTION 7. Counterparts. This Agreement may be executed by the parties hereto in
several counterparts, each of which shall be deemed to be an original and all of
which shall constitute together but one and the same agreement.

* * * * *

13

IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
duly executed and delivered as of the date first above written.

[NAME OF GRANTOR]

      By:      

Name:
Title:

NATIONAL CITY BANK,
as Collateral Agent

      By:      

Name:

Title:

14

SCHEDULE I

to Trademark Security Agreement

Item A. Trademarks

Registered Trademarks

Country Trademark Registration No. Registration Date

Pending Trademark Applications

Country Trademark Serial No. Filing Date

Trademark Applications in Preparation

Expected Products/

Country Trademark Docket No. Filing Date Services 

                      Item B. Trademark Licenses
               
 
                     
               
 
                   
Country or
Territory
  Trademark   Licensor   Licensee   Effective
     Date       Expiration
      Date   
 
                   

15

EXHIBIT C

to Security Agreement

COPYRIGHT SECURITY AGREEMENT

This COPYRIGHT SECURITY AGREEMENT, dated as of      , 200     (this
“Agreement”), is made by [NAME OF GRANTOR], a      (the “Grantor”), in favor of
NATIONAL CITY BANK, as the collateral agent (together with its successor(s)
thereto in such capacity, the “Collateral Agent”) for each of the Secured
Parties.

W I T N E S S E T H :

WHEREAS, this Agreement is made pursuant to the Credit Agreement, dated as of
June 6, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Credit Agreement”), among the Borrowers, the
various financial institutions and other Persons from time to time party thereto
(the “Lenders”), the Credit Suisse, Cayman Islands Branch, as the Term Loan
Administrative Agent, National City as the Revolving Loan Administrative Agent
and the Collateral Agent, and Keybank National Association, as the Documentation
Agent;

WHEREAS, in connection with the Credit Agreement, the Grantor has executed and
delivered a Pledge and Security Agreement, dated as of June 6, 2006 (as amended,
supplemented, amended and restated or otherwise modified from time to time, the
“Security Agreement”);

WHEREAS, pursuant to the Credit Agreement and pursuant to clause (e) of
Section 4.5 of the Security Agreement, the Grantor is required to execute and
deliver this Agreement and to grant to the Collateral Agent a continuing
security interest in all of the Copyright Collateral (as defined below) to
secure all Secured Obligations; and

WHEREAS, the Grantor has duly authorized the execution, delivery and performance
of this Agreement; and

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Grantor agrees, for the benefit of each
Secured Party, as follows:

SECTION 1. Definitions. Unless otherwise defined herein or the context otherwise
requires, terms used in this Agreement, including its preamble and recitals,
have the meanings provided in the Security Agreement.

SECTION 2. Grant of Security Interest. The Grantor hereby assigns, pledges,
hypothecates, charges, mortgages, delivers, and transfers to the Collateral
Agent, for its benefit and the ratable benefit of each other Secured Party, and
hereby grants to the Collateral Agent, for its benefit and the ratable benefit
of each other Secured Party, a continuing security interest in all of the
following (the “Copyright Collateral”), whether now or hereafter existing or
acquired by the Grantor: all copyrights of the Grantor, whether statutory or
common law, registered or unregistered and whether published or unpublished, now
or hereafter in force throughout the world including all of the Grantor’s right,
title and interest in and to all copyrights registered in the United States
Copyright Office or anywhere else in the world and also including the copyrights
referred to in Item A of Schedule I hereto, and registrations and recordings
thereof and all applications for registration thereof, whether pending or in
preparation, all copyright licenses, including each copyright license referred
to in Item B of Schedule I hereto, the right to sue for past, present and future
infringements of any of the foregoing, all rights corresponding thereto, all
extensions and renewals of any thereof and all Proceeds of the foregoing,
including licenses, royalties, income, payments, claims, damages and Proceeds of
suit.

SECTION 3. Security Agreement. This Agreement has been executed and delivered by
the Grantor for the purpose of registering the security interest of the
Collateral Agent in the Copyright Collateral with the United States Copyright
Office and corresponding offices in other countries of the world. The security
interest granted hereby has been granted as a supplement to, and not in
limitation of, the security interest granted to the Collateral Agent for its
benefit and the ratable benefit of each other Secured Party under the Security
Agreement. The Security Agreement (and all rights and remedies of the Collateral
Agent and each Secured Party thereunder) shall remain in full force and effect
in accordance with its terms.

SECTION 4. Release of Liens. Upon (i) the Disposition of Copyright Collateral in
accordance with the Credit Agreement or (ii) the occurrence of the Termination
Date, the security interests granted herein shall automatically terminate with
respect to (A) such Copyright Collateral (in the case of clause (i)) or (B) all
Copyright Collateral (in the case of clause (ii)). Upon any such Disposition or
termination, the Collateral Agent will, at the Grantor’s sole expense, deliver
to the Grantor, without any representations, warranties or recourse of any kind
whatsoever, all Copyright Collateral held by the Collateral Agent hereunder, and
execute and deliver to the Grantor such Documents as the Grantor shall
reasonably request to evidence such termination.

SECTION 5. Acknowledgment. The Grantor does hereby further acknowledge and
affirm that the rights and remedies of the Collateral Agent with respect to the
security interest in the Copyright Collateral granted hereby are more fully set
forth in the Security Agreement, the terms and provisions of which (including
the remedies provided for therein) are incorporated by reference herein as if
fully set forth herein.

SECTION 6. Loan Document. This Agreement is a Loan Document executed pursuant to
the Credit Agreement and shall (unless otherwise expressly indicated herein) be
construed, administered and applied in accordance with the terms and provisions
thereof, including Article X thereof.

SECTION 7. Counterparts. This Agreement may be executed by the parties hereto in
several counterparts, each of which shall be deemed to be an original and all of
which shall constitute together but one and the same agreement.

* * * * *

16

IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
duly executed and delivered by as of the date first above written.

[NAME OF GRANTOR]

      By:      

Name:
Title:

NATIONAL CITY BANK,
as Collateral Agent

      By:      

Name:

Title:

17

SCHEDULE I

to Copyright Security Agreement

Item A. Copyrights/Mask Works

Registered Copyrights/Mask Works

Country Registration No. Registration Date Author(s) Title

Copyright/Mask Work Pending Registration Applications

Country Serial No. Filing Date Author(s) Title

Copyright/Mask Work Registration Applications in Preparation

Expected

Country Docket No. Filing Date Author(s) Title

                  Item B. Copyright/Mask Work Licenses
           
 
                 
       
 
               
Country or
Territory
  Licensor   Licensee   Effective
    Date         Expiration
    Date        
 
               

18

ANNEX I

to Security Agreement

SUPPLEMENT TO
PLEDGE AND SECURITY AGREEMENT

This SUPPLEMENT, dated as of      ,      (this “Supplement”), is to the Pledge
and Security Agreement, dated as of June 6, 2006 (as amended, supplemented,
amended and restated or otherwise modified from time to time, the “Security
Agreement”), among the Grantors (such term, and other terms used in this
Supplement, to have the meanings set forth in Article I of the Security
Agreement) from time to time party thereto, in favor of NATIONAL CITY BANK, as
the collateral agent (together with its successor(s) thereto in such capacity,
the “Collateral Agent”) for each of the Secured Parties.

W I T N E S S E T H
:

WHEREAS, this Supplement is made pursuant to the Credit Agreement, dated as of
June 6, 2006 (as amended, supplemented, amended and restated or otherwise
modified from time to time, the “Credit Agreement”), among the Borrowers, the
various financial institutions and other Persons from time to time party thereto
(the “Lenders”), the Credit Suisse, Cayman Islands Branch, as the Term Loan
Administrative Agent, National City as the Revolving Loan Administrative Agent
and the Collateral Agent, and Keybank National Association, as the Documentation
Agent;

WHEREAS, pursuant to the provisions of Section 7.6 of the Security Agreement,
each of the undersigned is becoming a Grantor under the Security Agreement; and

WHEREAS, each of the undersigned desires to become a “Grantor” under the
Security Agreement in order to induce the Secured Parties to continue to extend
Loans and issue Letters of Credit under the Credit Agreement;

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, each of the undersigned agrees, for the benefit
of each Secured Party, as follows.

SECTION 1. Party to Security Agreement, etc. In accordance with the terms of the
Security Agreement, by its signature below each of the undersigned hereby
irrevocably agrees to become a Grantor under the Security Agreement with the
same force and effect as if it were an original signatory thereto and each of
the undersigned hereby (a) agrees to be bound by and comply with all of the
terms and provisions of the Security Agreement applicable to it as a Grantor and
(b) represents and warrants that the representations and warranties made by it
as a Grantor thereunder are true and correct as of the date hereof, unless
stated to relate solely to an earlier date, in which case such representations
and warranties shall be true and correct as of such earlier date. In furtherance
of the foregoing, each reference to a “Grantor” and/or “Grantors” in the
Security Agreement shall be deemed to include each of the undersigned.

SECTION 2. Representations. Each of the undersigned Grantor hereby represents
and warrants that this Supplement has been duly authorized, executed and
delivered by it and that this Supplement and the Security Agreement constitute
the legal, valid and binding obligation of each of the undersigned, enforceable
against it in accordance with its terms.

SECTION 3. Full Force of Security Agreement. Except as expressly supplemented
hereby, the Security Agreement shall remain in full force and effect in
accordance with its terms.

SECTION 4. Severability. Wherever possible each provision of this Supplement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Supplement shall be prohibited by
or invalid under such law, such provision shall be ineffective to the extent of
such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Supplement or the Security
Agreement.

SECTION 5. Governing Law, Entire Agreement, etc. THIS SUPPLEMENT SHALL BE DEEMED
TO BE A CONTRACT MADE UNDER AND GOVERNED BY THE INTERNAL LAWS OF THE STATE OF
NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL
OBLIGATIONS LAW OF THE STATE OF NEW YORK). This Supplement and the other Loan
Documents constitute the entire understanding among the parties hereto with
respect to the subject matter thereof and supersede any prior agreements,
written or oral, with respect thereto.

SECTION 6. Counterparts. This Supplement may be executed by the parties hereto
in several counterparts, each of which shall be deemed to be an original and all
of which shall constitute together but one and the same agreement.

* * * * *

19

IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
duly executed and delivered by its Authorized Officer as of the date first above
written.

[NAME OF ADDITIONAL SUBSIDIARY]

      By:      

Name:
Title:

[NAME OF ADDITIONAL SUBSIDIARY]

             By:_________________________________
   Name:
   Title:

ACCEPTED AND AGREED FOR ITSELF
        AND ON BEHALF OF THE SECURED PARTIES:

NATIONAL CITY BANK, as Collateral Agent
       
By:
    —  

Name:

Title:

20

[COPY SCHEDULES FROM SECURITY AGREEMENT]

21