Execution Version

 

EXHIBIT 10.2

 

FIRST LIEN GUARANTEE AND COLLATERAL AGREEMENT

dated as of

April 8, 2005

As Amended and Restated as of

April 9, 2020

 

 

among

 

 

THE GOODYEAR TIRE & RUBBER COMPANY,

as Borrower,

 

 

The SUBSIDIARIES OF THE GOODYEAR TIRE & RUBBER COMPANY Identified as Grantors
and Guarantors Herein

 

 

and

 

 

JPMORGAN CHASE BANK, N.A.,

as Collateral Agent

 

 

 

 

 

[CS&M Ref. No. 6701-315]

NY: 1237020-2

 

 

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TABLE OF CONTENTS

Page

 

ARTICLE I

 

Definitions

 

SECTION 1.01.

 

Certain Defined Terms

2

 

 

ARTICLE II

 

Guarantees

 

SECTION 2.01.

 

Guarantees

10

 

SECTION 2.02.

 

Guarantee of Payment

10

 

SECTION 2.03.

 

No Limitations

10

 

SECTION 2.04.

 

Reinstatement

11

 

SECTION 2.05.

 

Agreement To Pay; Subrogation

11

 

SECTION 2.06.

 

Information

12

 

 

 

 

 

 

 

 

ARTICLE III

12

 

 

 

[Intentionally omitted]

12

 

 

 

 

 

 

 

 

ARTICLE IV

 

 

 

 

Pledge of Securities

 

 

 

 

 

 

 

SECTION 4.01.

 

Pledge

12

 

SECTION 4.02.

 

Voting Rights; Dividends and Interest

12

 

 

 

 

 

 

 

 

ARTICLE V

 

 

 

 

Security Interests in Personal Property

 

 

 

 

 

 

 

SECTION 5.01.

 

Creation of Security Interests

14

 

SECTION 5.02.

 

Certain Filings

15

 

SECTION 5.03.

 

Representations and Warranties

15

 

SECTION 5.04.

 

Covenants

16

 

SECTION 5.05.

 

Other Actions

17

 

SECTION 5.06.

 

Covenants Regarding Patent, Trademark and Copyright Collateral

18

 

SECTION 5.07.

 

Lockbox System

19

 

SECTION 5.08.

 

Insurance

20

 

SECTION 5.09.

 

Securities Accounts

20

 

 

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ARTICLE VI

 

 

 

 

Other Pledges, Mortgages and Security Interests

 

 

 

 

 

 

 

SECTION 6.01.

 

Other Security Documents

21

 

SECTION 6.02.

 

Other Security Documents Subject to This Agreement

21

 

 

 

 

 

 

 

 

ARTICLE VII

 

 

 

 

Remedies

 

 

 

 

 

 

 

SECTION 7.01.

 

Remedies Upon Default

22

 

SECTION 7.02.

 

Exercise of Remedies under Other Security Documents

23

 

SECTION 7.03.

 

Application of Proceeds

23

 

SECTION 7.04.

 

Grant of License to Use Intellectual Property

25

 

SECTION 7.05.

 

Securities Act

25

 

SECTION 7.06.

 

Registration

26

 

 

 

 

 

 

 

 

ARTICLE VIII

 

 

 

 

Indemnity, Subrogation and Subordination

 

 

 

 

 

 

 

SECTION 8.01.

 

Indemnity and Subrogation

27

 

SECTION 8.02.

 

Contribution and Subrogation

27

 

SECTION 8.03.

 

Subordination

28

 

 

 

 

 

 

 

 

ARTICLE IX

 

 

 

 

Duties of Collateral Agent

 

 

 

 

 

 

 

SECTION 9.01.

 

Actions Under This Agreement

28

 

 

 

 

ARTICLE X

 

 

 

 

Concerning the Collateral Agent

 

 

 

 

 

 

 

SECTION 10.01.

 

Limitations on Responsibility of Collateral Agent

29

 

SECTION 10.02.

 

Reliance by Collateral Agent; Indemnity Against Liabilities, etc

30

 

SECTION 10.03.

 

Resignation and Removal of the Collateral Agent

31

 

SECTION 10.04.

 

Expenses and Indemnification

31

 

 

 

 

 

 

 

 

ARTICLE XI

 

 

 

 

Subordination of Intercompany Indebtedness

 

 

 

 

 

 

 

SECTION 11.01.

 

Subordination

32

 

SECTION 11.02.

 

Dissolution or Insolvency

32

 

SECTION 11.03.

 

Subrogation

33

 

SECTION 11.04.

 

Other Creditors

33

 

SECTION 11.05.

 

No Waiver

33

 

SECTION 11.06.

 

Obligations Hereunder Not Affected

33

 

ii

 

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ARTICLE XII

 

 

 

 

Miscellaneous

 

 

 

 

 

 

 

SECTION 12.01.

 

Notices

34

 

SECTION 12.02.

 

Waivers; Amendment

34

 

SECTION 12.03.

 

Collateral Agent’s Fees and Expenses; Indemnification

35

 

SECTION 12.04.

 

Successors and Assigns

35

 

SECTION 12.05.

 

Survival of Agreement

36

 

SECTION 12.06.

 

Counterparts; Effectiveness; Several Agreement

36

 

SECTION 12.07.

 

Severability

36

 

SECTION 12.08.

 

Right of Set-Off

37

 

SECTION 12.09.

 

Governing Law; Jurisdiction; Consent to Service of Process

37

 

SECTION 12.10.

 

WAIVER OF JURY TRIAL

38

 

SECTION 12.11.

 

Headings

38

 

SECTION 12.12.

 

Security Interest Absolute

38

 

SECTION 12.13.

 

Termination or Release

38

 

SECTION 12.14.

 

Additional Grantors and Guarantors

40

 

SECTION 12.15.

 

Collateral Agent Appointed Attorney-in-Fact

40

 

SECTION 12.16.

 

Excluded Swap Obligations

41

 

 

 

 

 

 

 

 

SCHEDULES:

 

 

 

 

 

 

 

Schedule I

 

Aircraft

 

 

Schedule II

 

Foreign Pledge Agreements

 

 

Schedule III

 

Mortgages

 

 

 

 

 

 

 

 

 

EXHIBITS:

 

 

 

 

 

 

 

Exhibit I

 

Form of Perfection Certificate

 

 

 

 

iii

 

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FIRST LIEN GUARANTEE AND COLLATERAL AGREEMENT dated as of April 8, 2005, as
amended and restated as of April 9, 2020 (this “Agreement”), among THE GOODYEAR
TIRE & RUBBER COMPANY (the “Company”), the Subsidiaries of the Company
identified herein and JPMORGAN CHASE BANK, N.A., as collateral agent (the
“Collateral Agent”).

A.The Lenders (such term and each other capitalized term used and not otherwise
defined herein having the meaning assigned to it in Article I) have agreed to
extend credit to the Company on the terms and subject to the conditions set
forth in the Credit Agreement.  The obligations of the Lenders to extend such
credit are conditioned upon the execution and delivery of this Agreement by the
Company, the Subsidiary Grantors and the Subsidiary Guarantors.  The Subsidiary
Grantors and Subsidiary Guarantors are subsidiaries of the Company, have derived
and will derive substantial benefits from the extension of credit to the Company
pursuant to the Credit Agreement and are willing to execute and deliver this
Agreement in order to induce the Lenders to continue to extend such credit.  

B.The Obligations have been designated as “Designated Senior Obligations” or
otherwise constitute “Senior Obligations” under the Lien Subordination and
Intercreditor Agreement, and the Liens securing the Obligations are accordingly
senior to the Liens securing the Junior Obligations (as defined in the Lien
Subordination and Intercreditor Agreement) on the terms set forth in the Lien
Subordination and Intercreditor Agreement.  The Obligations also constitute
“First Lien Obligations” under the Lenders Lien Subordination and Intercreditor
Agreement, and the Liens securing the Obligations are accordingly senior to the
Liens securing the Second Lien Obligations (as defined in the Lenders Lien
Subordination and Intercreditor Agreement) on the terms set forth in the Lenders
Lien Subordination and Intercreditor Agreement.

Accordingly, the parties hereto agree as follows:

 

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2

ARTICLE I

Definitions

SECTION 1.01.  Certain Defined Terms. (a)  All terms (whether or not capitalized
herein) defined in the New York UCC and not defined in this Agreement have the
meanings specified therein; the term “instrument” shall have the meaning
specified in Article 9 of the New York UCC.

(b)  All terms defined in the Credit Agreement and not defined in this
Agreement, including, without limitation, the terms “Administrative Agent”,
“Borrower”, “Commitment”, “Consent Subsidiary”, “Credit Documents”, “Event of
Default”, “Foreign Pledge Agreement”, “Issuing Bank”, “Majority Lenders”,
“Material Intellectual Property”, “Mortgaged Property”, “Mortgage”, “Second Lien
Agreement” and “Second Lien Guarantee and Collateral Agreement” have the
meanings specified therein.  All references herein to the “date hereof”, or the
“date of this Agreement” are references to April 8, 2005.  The rules of
construction specified in Section 1.04 of the Credit Agreement shall also apply
to this Agreement.

As used in this Agreement, the following terms have the meanings specified
below:

“Account Control Agreement” means an account control agreement in a form
approved by the Collateral Agent, among a Grantor, the Collateral Agent and a
Deposit Account Institution.

“Account Debtor” means any Person who is or who may become obligated to any
Grantor under, with respect to or on account of an Account.

“Additional Subsidiary Agreement” has the meaning assigned to such term in
Section 12.14.

“Agreement” means this First Lien Guarantee and Collateral Agreement.

“Aircraft” means all airships, airplanes, helicopters and other aircraft owned
on the date hereof or hereafter acquired by any Grantor, including those listed
on Schedule I hereto, as updated from time to time pursuant to Section 5.04(c).

“Aircraft Collateral” means the Aircraft, Aircraft Parts and Aircraft Log Books.

“Aircraft Log Books” means any and all log books, maintenance records,
airworthiness certificates, registration documents and other records and
documents relating to the Aircraft or Aircraft Parts.

 

[[5336199v.2]]

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3

“Aircraft Parts” means all engines and propellers (whether or not affixed to any
Aircraft) owned by any Grantor and used or intended for use in connection with
the Aircraft, and all avionics equipment, radio equipment, navigation equipment,
radar equipment and other equipment, appliances, accessories and accessions used
or intended for use in connection with the Aircraft.

“Applicable Percentage” means, with respect to any Lender at any time, a
percentage equal to (a) the aggregate outstanding principal amount of the Loans,
LC Exposures and unused Commitments of such Lender at such time divided by (b)
the aggregate outstanding principal amount of the Loans, LC Exposures and unused
Commitments of all the Lenders at such time.

“Article 9 Collateral” means any and all of the following assets and properties
now owned or at any time hereafter acquired by any Grantor or in which such
Grantor now has or at any time in the future may acquire any right, title or
interest:  (a) all Accounts and Payment Intangibles (including without
limitation, all Credit Card Accounts Receivable); (b) all Chattel Paper; (c) all
Deposit Accounts (and all cash, checks and other negotiable instruments, funds
and other evidences of payment held therein); (d) all Inventory; (e) all
Documents; (f) all General Intangibles; (g) all Instruments; (h) all Equipment
(other than fixtures to real property not constituting Mortgaged Properties);
(i) all Investment Property (other than (i) Pledged Equity Interests, (ii)  the
Equity Interests described in clauses (b), (c) and (d) of the definition of
Excluded Equity Interests, and (iii) Proceeds in respect of Equity Interests
described in clauses (i) and (ii)); (j) all Letter-of-Credit rights; (k) all
books and records pertaining to any of the foregoing; (l) all Aircraft
Collateral; (m) all cash deposited to collateralize Letter of Credit
reimbursement obligations pursuant to the Credit Agreement and (n) to the extent
not otherwise included, all Proceeds and products of any and all of the
foregoing and all collateral security and guarantees given by any Person with
respect to any of the foregoing; provided, however, that, notwithstanding any of
the foregoing provisions of this definition, the Article 9 Collateral shall not
include Consent Assets.

“Bankruptcy Code” means Title 11 of the U.S. Code.

“Canadian Security Agreements” means the Canadian First Lien Guarantee and
Collateral Agreement dated as of the date hereof, as amended as of May 22, 2012,
as amended and restated as of April 7, 2016, and as amended and restated as of
April 9, 2020, between Goodyear Canada Inc., the other Canadian Guarantors party
thereto and the Collateral Agent, and the Quebec First Lien Hypothec (as defined
in the Canadian First Lien Guarantee and Collateral Agreement), in each case as
from time to time amended, supplemented or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein).

“Claiming Party” has the meaning assigned to such term in Section 8.02.

“Collateral” means the Pledged Collateral, the Article 9 Collateral and the
Mortgaged Properties.

 

[[5336199v.2]]

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4

“Collateral Proceeds Account” means a Deposit Account maintained at JPMorgan
Chase Bank, N.A., as Collateral Agent, for the benefit of the Secured Parties,
and any successor account maintained with the Collateral Agent.

“Consent Asset” means any asset or right of a Grantor the creation of a security
interest in which would be prohibited by or not be effective under applicable
law or would violate or result in a default under any agreement or instrument in
effect on the date hereof (or in the case of any future Grantor on the date it
becomes a Grantor) between such Grantor and any Person other than (a) the
Company, (b) any Wholly Owned Subsidiary or (c) any Subsidiary that is not a
Wholly Owned Subsidiary unless the waiver of such default or violation would
require the consent of any Person other than the Company or another Subsidiary;
provided that no asset or right shall be a Consent Asset to the extent that
Section 9-406, 9-407, 9-408 or 9-409 of the Uniform Commercial Code as in effect
in the applicable jurisdiction, or any other law of the applicable jurisdiction,
shall permit (and excuse any default or violation resulting from) the creation
of a security interest in such asset or right notwithstanding the provision of
such agreement or instrument prohibiting the creation of a security interest
therein or shall render such provision unenforceable.

“Control Notice” has the meaning assigned to such term or any similar term
(including, without limitation, “Shifting Control Notice”, “Exclusive Access
Notice” and “Activation Notice”) in each Account Control Agreement.

“Contributing Party” has the meaning assigned to such term in Section 8.02.

“Copyright License” means any written agreement, now or hereafter in effect,
granting any right to any third party under any copyright now or hereafter owned
by any Grantor or that such Grantor otherwise has the right to license, or
granting any right to any Grantor under any copyright now or hereafter owned by
any third party, and all rights of such Grantor under any such agreement.

“Copyrights” means all of the following now owned or hereafter acquired by any
Grantor:  (a) all copyright rights in any work subject to the copyright laws of
the United States or any other country, whether as author, assignee, transferee
or otherwise, and (b) all registrations and applications for registration of any
such copyright in the United States or any other country, including
registrations, recordings, supplemental registrations and pending applications
for registration in the United States Copyright Office.

“Credit Agreement” means the First Lien Credit Agreement dated as of April 8,
2005, among the Company, the Lenders and Issuing Banks party thereto and
JPMorgan Chase Bank, N.A., as Administrative Agent, as amended and restated as
of April 20, 2007, as further amended and restated as of April 19, 2012, as
further amended and restated as of April 7, 2016, as further amended and
restated as of April 9, 2020, and as may be further amended, restated, amended
and restated, supplemented or otherwise modified from time to time; provided,
that as used in the definition of “Miscellaneous Obligations”, the term “Credit
Agreement” shall mean the Credit Agreement as in effect at any relevant time on
or after April 8, 2005.

 

[[5336199v.2]]

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5

“Credit Card Accounts Receivable” means any receivables due to any Grantor from
a credit card issuer or a credit card processor in connection with purchases of
Inventory from such Grantor by means of any credit card or debit card.

“Credit Parties” means the Company and each Grantor and Guarantor.

“Deposit Account” means a demand, time, savings, passbook or other account
maintained by the Company or a Subsidiary with a bank.  

“Deposit Account Institution” means each financial institution at which a
Deposit Account in the Lockbox System is maintained.

“Effective Date” means April 8, 2005.

“Equity Interests” means shares of capital stock, partnership interests,
membership interests in limited liability companies, beneficial interests in
trusts or other equity ownership interests in any Persons, and any warrants,
options or other rights entitling the holders thereof to purchase or acquire any
such equity interests.

“Excluded Equity Interests” means (a) Equity Interests in any Subsidiary with
Total Assets not greater than $10,000,000 as of the end of the most recent
fiscal quarter for which financial statements have been delivered pursuant to
Section 5.01(a) or (b) of the Credit Agreement, (b) Equity Interests in any
Consent Subsidiary, (c) Equity Interests in Goodyear Argentina, Goodyear Canada,
Goodyear Luxembourg and Goodyear Venezuela, and (d) Equity Interests in any
Foreign Subsidiary with respect to which a Financial Officer has delivered a
certificate in accordance with clause (B) of the proviso in Section 5.08(b) of
the Credit Agreement.

“Excluded Operating Account” means payroll and other operating accounts of the
Company or any other Grantor that are not used to receive (a) payments from any
Account Debtor in respect of Accounts or (b) payments in respect of Inventory,
and containing only such amounts as are required in the Company’s or such other
Grantor’s good faith judgment for near-term operational purposes.

“FAA” means the Federal Aviation Administration or the United States Department
of Transportation or both, as the context may require, or any successors
thereto.

“Federal Securities Laws” has the meaning assigned to such term in Section 7.05.

“Foreign Subsidiary” means any Subsidiary organized under the laws of a
jurisdiction other than the United States or any of its territories or
possessions or any political subdivision thereof.

“GEBV” means Goodyear Europe B.V., a Subsidiary organized in the Netherlands.

 

[[5336199v.2]]

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6

“GEBV Subsidiary” means a subsidiary of GEBV.

“General Intangibles” means, as to any Grantor, all choses in action and causes
of action and all other intangible personal property of every kind and nature
(other than Accounts) now owned or hereafter acquired by such Grantor, including
to the extent relevant corporate or other business records, indemnification
claims, contract rights (including rights under leases, whether entered into as
lessor or lessee, Swap Agreements and other agreements), Intellectual Property,
goodwill, registrations, franchises, tax refund claims and any letter of credit,
guarantee, claim, security interest or other security held by or granted to such
Grantor to secure payment by an Account Debtor of any Accounts.

“Grantors” means the Company and the Subsidiary Grantors.

“Guarantors” means the Company and the Subsidiary Guarantors.

“Indemnified Party” has the meaning assigned to such term in Section 10.04.

“Indenture Properties” means each “Restricted Property” (as defined in the
Indentures) of the Company and each “Restricted Subsidiary” (as defined in the
Indentures).

“Indentures” means (a) the Indenture dated as of March 15, 1996, between the
Company and Wells Fargo Bank, N.A. (as successor to JPMorgan Chase Bank), as
trustee, as supplemented on March 16, 1998 and (b) the Indenture dated as of
March 1, 1999, between the Company and Wells Fargo Bank, N.A. (as successor to
JPMorgan Chase Bank), as trustee, as supplemented by the First Supplemental
Indenture thereto dated as of March 5, 2010, in each case of clauses (a) and
(b), as may be further amended, supplemented or otherwise modified from time to
time.

“Intellectual Property” means, as to any Grantor, all intellectual and similar
property of every kind and nature now owned or hereafter acquired by such
Grantor, including inventions, designs, Patents, Copyrights, Licenses,
Trademarks, trade secrets, confidential or proprietary technical and business
information, know-how, show-how or other data or information, software and
databases and all embodiments or fixations thereof and related documentation,
registrations and franchises, and all additions, improvements and accessions to,
and books and records describing or used in connection with, any of the
foregoing.

“Intercompany Indebtedness” means any Indebtedness of the Company or any
Subsidiary, or any obligations owed by the Company or any Subsidiary under
Article VIII, to the Company or any other Subsidiary.

“Intercompany Obligor” means, with respect to any Intercompany Indebtedness, the
obligor in respect of such Intercompany Indebtedness.

 

[[5336199v.2]]

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7

“JPMCB” means JPMorgan Chase Bank, N.A. and its successors.

“Lenders” means, collectively, the “Lenders” under and as defined in the Credit
Agreement.

“Lenders Lien Subordination and Intercreditor Agreement” means the Amended and
Restated Lenders Lien Subordination and Intercreditor Agreement among the
Collateral Agent, the collateral agent under the Second Lien Agreement, the
Borrower and the Subsidiary Guarantors (each as defined therein), dated as of
April 19, 2012, as from time to time amended, supplemented or otherwise modified
(subject to any restrictions on such amendments, supplements or modifications
set forth herein).

“License” means any Patent License, Trademark License, Copyright License or
other license or sublicense agreement to which any Grantor is a party.

“Lien Subordination and Intercreditor Agreement” means the Lien Subordination
and Intercreditor Agreement dated as of April 19, 2012, as amended, among (a)
the Collateral Agent, (b) the collateral agent under the Second Lien Agreement,
(c) the Designated Senior Obligations Collateral Agents and Designated Junior
Obligations Collateral Agents (as such terms are defined therein) from time to
time party thereto and (d) the Borrower and the Subsidiaries of the Borrower
party thereto or any substitute or successor agreement among such parties
containing substantially the same terms (and under which the Obligations shall
have been designated by the Borrower as “Senior Obligations”), with any changes
approved by the Administrative Agent.

“Local Collection Account” means a Deposit Account of a Grantor not subject to
the control of the Collateral Agent pursuant to an Account Control Agreement;
provided that such account shall not receive any payments in respect of Accounts
or Inventory other than that generated or sold by the Company’s retail division
(including both consumer and commercial).

“Lockbox System” has the meaning assigned to such term in Section 5.07.

“Miscellaneous Obligations” means (a) the due and punctual payment and
performance of all obligations of the Company or any Subsidiary (other than GEBV
or a GEBV Subsidiary) under each Swap Agreement that shall at any time have been
specified in a written notice (which may only be revoked with the consent of the
counterparty to such Swap Agreement) to the Administrative Agent from the
Company as being included in the Obligations, if such Swap Agreement (i) shall
have been in effect on the Effective Date with a counterparty that shall have
been a Lender or an Affiliate of a Lender under the Credit Agreement as in
effect on the Effective Date or (ii) shall have been entered into after the
Effective Date with any counterparty that shall have been a Lender or an
Affiliate of a Lender under the Credit Agreement at the time such Swap Agreement
was entered into, (b) the due and punctual payment and performance of all
obligations of the Company or any Subsidiary (other than GEBV or a GEBV
Subsidiary) arising out of or in connection with cash management or similar
services that shall at any

 

[[5336199v.2]]

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8

time have been specified in a written notice (which may only be revoked with the
consent of the counterparty to such cash management or similar services) to the
Administrative Agent from the Company as being included in the Obligations and
that are provided by a Person that shall have been a Lender or an Affiliate of a
Lender at the time of such written notice, and (c) solely to the extent then
permitted under each U.S. Credit Agreement, the due and punctual payment and
performance of all obligations of the Company or any Subsidiary (other than GEBV
or a GEBV Subsidiary) arising out of or in connection with bilateral letters of
credit that shall at any time have been specified in a written notice (which may
only be revoked with the consent of the issuing bank with respect to such
letters of credit) to the Administrative Agent from the Company as being
included in the Obligations and that are provided by a Person that shall have
been a Lender or an Affiliate of a Lender at the time of such written notice;
provided that the aggregate amount of such obligations under this clause (c) to
be included as Miscellaneous Obligations shall at no time exceed $100,000,000
(and if in excess thereof, shall be reduced on a ratable basis in order to
comply with the foregoing limitation).

“New York UCC” means the Uniform Commercial Code as from time to time in effect
in the State of New York.

“Obligations” means (a) the “Obligations”, as defined in the Credit Agreement,
and (b) the Miscellaneous Obligations.

“Other Security Documents” means the Canadian Security Agreements, the Foreign
Pledge Agreements, the Mortgages and each other instrument or document delivered
in connection with the cash collateralization of Letters of Credit, pursuant to
Section 5.08 of the Credit Agreement or otherwise to secure any of the
Obligations.

“Patent License” means any written agreement, now or hereafter in effect,
granting to any third party any right to make, use or sell any invention on
which a patent, now or hereafter owned by any Grantor or that any Grantor
otherwise has the right to license, is in existence, or granting to any Grantor
any right to make, use or sell any invention on which a patent, now or hereafter
owned by any third party, is in existence, and all rights of any such Grantor
under any such agreement.

“Patents” means all of the following now owned or hereafter acquired by any
Grantor:  (a) all letters patent of the United States or the equivalent thereof
in any other country, all registrations and recordings thereof, and all
applications for letters patent of the United States or the equivalent thereof
in any other country, including registrations, recordings and pending
applications in the United States Patent and Trademark Office or any similar
offices in any other country, including those listed on Schedule II to the
Perfection Certificate, as updated from time to time pursuant to
Section 5.04(c), and (b) all reissues, continuations, divisions,
continuations-in-part, renewals or extensions thereof, and the inventions
disclosed or claimed therein, including the right to make, use and/or sell the
inventions disclosed or claimed therein.

“Perfection Certificate” means a certificate substantially in the form of
Exhibit I.

 

[[5336199v.2]]

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9

“Pledged Collateral” means (a) the Pledged Equity Interests; (b) the Pledged
Debt Securities; (c) subject to Section 4.02, all payments of principal or
interest, dividends, cash, instruments and other property from time to time
received, receivable or otherwise distributed in respect of, in exchange for or
upon the conversion of, and all other Proceeds received in respect of, the
securities and other property referred to in the preceding clauses (a) and (b);
(d) subject to Section 4.02, all rights and privileges of each Grantor with
respect to the securities and other property referred to in clauses (a), (b) and
(c) above; and (e) all Proceeds of any of the foregoing.

“Pledged Debt Securities” means all debt securities (as defined in Article 8 of
the New York UCC) owned by any Grantor on the date hereof or obtained by it
after such date, and any promissory notes or other instruments evidencing any
such debt securities.

“Pledged Equity Interests” means all Equity Interests in Subsidiaries (other
than Excluded Equity Interests) owned by any Grantor on the date hereof or
obtained or owned by it after such date, and the certificates representing all
the foregoing Equity Interests, including the Equity Interests listed on
Schedule 3A to the Perfection Certificate, as updated from time to time pursuant
to Section 5.04(c); provided that the Pledged Equity Interests shall not include
more than 65% of the issued and outstanding voting Equity Interests of any
Foreign Subsidiary.

“Secured Parties” means the “Secured Parties” under and as defined in the Credit
Agreement and each other Person holding any Obligations or to which any
Obligations are owed.

“Security Documents” means this Agreement and the Other Security Documents.

“Subsidiary Grantors” means each Subsidiary that is listed under the heading
“Grantor” on the signature pages hereto or that becomes a Grantor pursuant to
Section 12.14.

“Subsidiary Guarantors” means each Subsidiary that is listed under the heading
“Guarantor” on the signature pages hereto or that becomes a Guarantor pursuant
to Section 12.14.

“Trademark License” means any written agreement, now or hereafter in effect,
granting to any third party any right to use any trademark now or hereafter
owned by any Grantor or that any such Grantor otherwise has the right to
license, or granting to any Grantor any right to use any trademark now or
hereafter owned by any third party, and all rights of any such Grantor under any
such agreement.

 

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“Trademarks” means all of the following now owned or hereafter acquired by any
Grantor:  (a) all trademarks, service marks, trade names, corporate names,
company names, business names, fictitious business names, trade styles, trade
dress, logos, other source or business identifiers, designs and general
intangibles of like nature, now existing or hereafter adopted or acquired, all
registrations and recordings thereof, and all registration and recording
applications filed in connection therewith, including registrations and
registration applications in the United States Patent and Trademark Office or
any similar offices in any State of the United States or any other country or
any political subdivision thereof, and all extensions or renewals thereof,
including those listed on Schedule II to the Perfection Certificate, as updated
from time to time pursuant to Section 5.04(c), (b) all goodwill associated
therewith or symbolized thereby and (c) all other assets, rights and interests
that uniquely reflect or embody such goodwill.  

ARTICLE II

Guarantees

SECTION 2.01.  Guarantees.  Each Guarantor irrevocably and unconditionally
guarantees, as a primary obligor and not merely as a surety, the due and
punctual payment and performance of the Obligations, jointly with the other
Guarantors and severally.  Each of the Guarantors further agrees that the
Obligations may be extended or renewed, in whole or in part, without notice to
or further assent from it, and that it will remain bound upon its guarantee
notwithstanding any extension or renewal of any Obligation.  Each of the
Guarantors waives presentment to, demand of payment from and protest to the
Company or any other Credit Party of any of the Obligations, and also waives
notice of acceptance of its guarantee, notice of protest for nonpayment and all
similar formalities.

SECTION 2.02.  Guarantee of Payment.  Each of the Guarantors further agrees that
its guarantee hereunder constitutes a guarantee of payment when due and not of
collection, and waives any right to require that any resort be had by the
Collateral Agent or any other Secured Party to any security held for the payment
of the Obligations or to any balance of any Deposit Account or credit on the
books of the Collateral Agent or any other Secured Party in favor of the Company
or any other Person.

SECTION 2.03.  No Limitations.  (a)  Except for termination of a Guarantor’s
obligations hereunder as expressly provided in Section 12.13, the obligations of
each Guarantor hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason, including any claim of waiver,
release, surrender, alteration or compromise, and shall not be subject to any
defense or set-off, counterclaim, recoupment or termination whatsoever by reason
of the invalidity, illegality or unenforceability of the Obligations or
otherwise.  Without limiting the generality of the foregoing, the obligations of
each Guarantor hereunder shall not be discharged or impaired or otherwise
affected by (i) the failure of the Collateral Agent or any other Secured Party
to assert any claim or demand or to enforce any right or remedy under the
provisions of any Credit Document or otherwise; (ii) any rescission, waiver,
amendment

 

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or modification of, or any release from any of the terms or provisions of, any
Credit Document or any other agreement, including with respect to any other
Guarantor under this Agreement; (iii) the release of any security held by the
Collateral Agent or any other Secured Party for the Obligations; (iv) any
default, failure or delay, wilful or otherwise, in the performance of the
Obligations; or (v) any other act or omission that may or might in any manner or
to any extent vary the risk of such Guarantor or otherwise operate as a
discharge of such Guarantor as a matter of law or equity (other than the
indefeasible payment in full in cash of all the Obligations).  Each Guarantor
expressly authorizes the Secured Parties to take and hold security for the
payment and performance of the Obligations, to exchange, waive or release any or
all such security (with or without consideration), to enforce or apply such
security and direct the order and manner of any sale thereof in their sole
discretion or to release or substitute any one or more other guarantors or
obligors upon or in respect of the Obligations, all without affecting the
obligations of such Guarantor hereunder.

(b)  To the fullest extent permitted by applicable law, each Guarantor waives
any defense based on or arising out of any defense of the Company or any other
Credit Party or the unenforceability of the Obligations or any part thereof from
any cause, or the cessation from any cause of the liability of the Company or
any other Credit Party, other than the indefeasible payment in full in cash of
all the Obligations.  The Collateral Agent and the other Secured Parties may, at
their election, foreclose on any security held by one or more of them by one or
more judicial or nonjudicial sales, accept an assignment of any such security in
lieu of foreclosure, compromise or adjust any part of the Obligations, make any
other accommodation with the Company or any other Credit Party or exercise any
other right or remedy available to them against the Company or any other Credit
Party, in each case without affecting or impairing in any way the liability of
any Guarantor hereunder except to the extent the Obligations have been fully and
indefeasibly paid in full in cash.  To the fullest extent permitted by
applicable law, each Guarantor waives any defense arising out of any such
election even though such election operates, pursuant to applicable law, to
impair or to extinguish any right of reimbursement or subrogation or other right
or remedy of such Guarantor against the Company or any other Credit Party, as
the case may be, or any security.

SECTION 2.04.  Reinstatement.  Each of the Guarantors agrees that its guarantee
hereunder shall continue to be effective or be reinstated, as the case may be,
if at any time payment, or any part thereof, of any Obligation is rescinded or
must otherwise be restored by the Collateral Agent or any other Secured Party
upon the bankruptcy or reorganization of the Company, any other Credit Party or
otherwise.

SECTION 2.05.  Agreement To Pay; Subrogation.  In furtherance of the foregoing
and not in limitation of any other right that the Collateral Agent or any other
Secured Party has at law or in equity against any Guarantor by virtue hereof,
upon the failure of the Company or any other Credit Party to pay any Obligation
when and as the same shall become due, whether at maturity, by acceleration,
after notice of prepayment or otherwise, such Guarantor hereby promises to and
will forthwith pay, or cause to be paid, to the Collateral Agent for
distribution to the applicable Secured Parties in cash the amount of such unpaid
Obligation.  Upon payment by any Guarantor of any sums to the

 

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Collateral Agent as provided above, all rights of such Guarantor against the
Company or any other Credit Party arising as a result thereof by way of right of
subrogation, contribution, reimbursement, indemnity or otherwise shall in all
respects be subordinate to the Obligations of the Company or such Credit Party
on the terms set forth in Article XI.

SECTION 2.06.  Information.  Each Guarantor assumes all responsibility for being
and keeping itself informed of the Company’s and each other Credit Party’s
financial condition and assets, and of all other circumstances bearing upon the
risk of nonpayment of the Obligations and the nature, scope and extent of the
risks that such Guarantor assumes and incurs hereunder, and agrees that none of
the Collateral Agent or the other Secured Parties will have any duty to advise
such Guarantor of information known to it or any of them regarding such
circumstances or risks.

ARTICLE III

[Intentionally omitted]

ARTICLE IV

Pledge of Securities

SECTION 4.01.  Pledge.  As security for the payment or performance, as the case
may be, in full of the Obligations, each Grantor hereby grants to the Collateral
Agent, its successors and assigns a security interest in all such Grantor’s
right, title and interest in, to and under the Pledged Collateral, to have and
to hold all such Pledged Collateral, together with all right, title, interest,
powers, privileges and preferences pertaining or incidental thereto, for the
benefit of the Secured Parties; subject, however, to the terms, covenants and
conditions hereinafter set forth.

SECTION 4.02.  Voting Rights; Dividends and Interest.  (a)  Unless and until an
Event of Default shall have occurred and be continuing and the Collateral Agent
shall have notified the Grantors that their rights under this Section are being
suspended:

(i)  Each Grantor shall be entitled to exercise any and all voting and/or other
rights and powers inuring to an owner of Pledged Collateral or any part thereof
for any purpose consistent with the terms of this Agreement and the Credit
Agreement, including the right to sell or otherwise transfer such Pledged
Collateral in accordance with the terms of the Credit Agreement.

(ii)  The Collateral Agent shall execute and deliver to each Grantor, or cause
to be executed and delivered to such Grantor, all such proxies, powers of
attorney, certificates and other instruments as such Grantor may reasonably
request for the purpose of enabling such Grantor to exercise the voting and/or
rights and powers it is entitled to exercise pursuant to subparagraph (i) above.

 

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(iii)  Each Grantor shall be entitled to receive and retain any and all
dividends, interest, principal and other distributions paid on or distributed in
respect of the Pledged Collateral to the extent and only to the extent that such
dividends, interest, principal and other distributions are permitted by, and
otherwise paid or distributed in accordance with, the terms and conditions of
the Credit Agreement, the other Credit Documents and applicable laws; provided
that any noncash dividends, interest, principal or other distributions that
would constitute Pledged Equity Interests or Pledged Debt Securities, whether
resulting from a subdivision, combination or reclassification of the outstanding
Equity Interests of the issuer of any Pledged Collateral or received in exchange
for Pledged Collateral or any part thereof, or in redemption thereof, or as a
result of any merger, consolidation, acquisition or other exchange of assets to
which such issuer may be a party or otherwise, shall be and become part of the
Pledged Collateral.

(b)  Upon the occurrence and during the continuance of an Event of Default,
after the Collateral Agent shall have notified the Grantors of the suspension of
their rights under paragraph (a)(iii) of this Section, all rights of any Grantor
to dividends, interest, principal or other distributions that such Grantor is
authorized to receive pursuant to paragraph (a)(iii) of this Section shall
cease, and all such rights shall thereupon become vested in the Collateral
Agent, which shall have the sole and exclusive right and authority to receive
and retain such dividends, interest, principal or other distributions.  All
dividends, interest, principal or other distributions received by any Grantor
contrary to the provisions of this Section shall be held in trust for the
benefit of the Collateral Agent, shall be segregated from other property or
funds of such Grantor and shall be forthwith delivered to the Collateral Agent
upon demand in the form in which so received (with any necessary
endorsement).  Any and all money and other property paid over to or received by
the Collateral Agent pursuant to the provisions of this paragraph (b) shall be
retained by the Collateral Agent in an account to be established by the
Collateral Agent upon receipt of such money or other property and shall be
applied in accordance with the provisions of Section 7.03.  After all Events of
Default have been cured or waived and the Company has delivered to the
Collateral Agent a certificate to that effect, the Collateral Agent shall
(subject to any applicable provisions of the Second Lien Guarantee and
Collateral Agreement, the Lenders Lien Subordination and Intercreditor Agreement
and the Lien Subordination and Intercreditor Agreement) promptly repay to each
Grantor (without interest) all dividends, interest, principal or other
distributions that such Grantor would otherwise be permitted to retain pursuant
to the terms of paragraph (a)(iii) of this Section and that remain in such
account.

(c)  Upon the occurrence and during the continuance of an Event of Default,
after the Collateral Agent shall have notified the Grantors of the suspension of
their rights under paragraph (a)(i) of this Section, all rights of any Grantor
to exercise the voting and consensual rights and powers it is entitled to
exercise pursuant to paragraph (a)(i) of this Section, and the obligations of
the Collateral Agent under paragraph (a)(ii) of this Section, shall cease, and
all such rights shall thereupon become vested in the Collateral Agent, which
shall have the sole and exclusive right and authority to exercise such voting
and consensual rights and powers; provided that, unless otherwise directed by
the Majority Lenders, the Collateral Agent shall have the right from time to
time following and during the continuance of an Event of Default to permit the
Grantors to exercise such rights.

 

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(d)  Any notice given by the Collateral Agent to the Grantors suspending their
rights under paragraph (a) of this Section (i) may be given by telephone if
promptly confirmed in writing, (ii) may be given to one or more of the Grantors
at the same or different times and (iii) may suspend the rights of the Grantors
under paragraph (a)(i) or paragraph (a)(iii) in part without suspending all such
rights (as specified by the Collateral Agent in its sole and absolute
discretion) and without waiving or otherwise affecting the Collateral Agent’s
rights to give additional notices from time to time suspending other rights so
long as an Event of Default has occurred and is continuing.

ARTICLE V

Security Interests in Personal Property

SECTION 5.01.  Creation of Security Interests.  (a)   As security for the
payment or performance, as the case may be, in full of the Obligations, each
Grantor hereby grants to the Collateral Agent, its successors and assigns, for
the benefit of the Secured Parties, a security interest in all right, title or
interest in or to any and all the Article 9 Collateral now owned or at any time
hereafter acquired by such Grantor or in which such Grantor now has or at any
time in the future may acquire any right, title or interest.

(b)  [Intentionally omitted]

(c)  Notwithstanding any other provision of this Agreement, for so long as any
of the Indentures shall remain in effect and Indebtedness shall be outstanding
thereunder, the aggregate amount of the Obligations secured by (i) the security
interests granted under this Section and (ii) the Liens created under the
Mortgages, in each case to the extent the assets subject to such security
interests and Liens constitute Indenture Properties, shall not exceed the
maximum amount of the Obligations that can be so secured without violation of
the Indentures.  If at any time after the date hereof any amount of the
Obligations that may be secured by any security interest or Lien on the
Indenture Properties without violation of the Indentures shall increase, in
either case by reason of (i) the termination of the Indentures or any provisions
therein or the repayment of all Indebtedness outstanding thereunder, (ii) any
amendment of or waiver under the Indentures, (iii) any increase in any
applicable basket or exception under the Indentures as a result of the financial
performance of the Company and the Subsidiaries or otherwise or (iv) any other
event or condition, the amount of the outstanding Obligations secured by
security interests in and Liens on the Indenture Properties shall be
simultaneously and automatically increased to the maximum amount permitted under
the Indentures.  No amount of Obligations that shall be secured by security
interests in and Liens on the Indenture Properties in accordance with the
foregoing provisions of this paragraph shall at any time cease to be so
guaranteed or secured as a result of (A) any subsequent amendment of or waiver
under any Indenture, (B) any subsequent change in the amount of any basket or
exception under any Indenture (to the extent the secured amount of the
Obligations is not required to be reduced under the terms of the Indentures) or
(C) any other event or condition (to the extent the secured amount of the
Obligations is not

 

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required to be reduced under the terms of the Indentures); provided, that if the
outstanding amount of the Obligations shall be reduced below the amount
permitted to be secured by security interests in and Liens on the Indenture
Properties and shall later be increased, the newly incurred Obligations will be
secured by security interests in and Liens on the Indenture Properties only to
the extent permitted under the Indentures and the foregoing provisions of this
Section at the time of such increase or thereafter.  Nothing in the preceding
two sentences shall result in the aggregate amount of the Obligations secured by
the Indenture Properties exceeding the maximum amount of the Obligations that
can be so secured without violation of the Indentures.

(d)  The security interests granted under this Section are granted as security
only and shall not subject the Collateral Agent or any other Secured Party to,
or in any way alter or modify, any obligation or liability of any Grantor with
respect to or arising out of the Article 9 Collateral.

SECTION 5.02.  Certain Filings.  (a)  Each Grantor hereby irrevocably authorizes
the Collateral Agent at any time and from time to time to file in any relevant
jurisdiction any initial financing statements (including fixture filings) with
respect to the Article 9 Collateral of such Grantor or any part thereof and
amendments thereto that contain the information required by Article 9 of the
Uniform Commercial Code of each applicable jurisdiction for the filing of any
financing statement or amendment, including (i) whether such Grantor is an
organization, the jurisdiction in which it is organized, the type of
organization and any organizational identification number issued to such Grantor
and (ii) in the case of a financing statement filed as a fixture filing, a
sufficient description of the real property to which such Article 9 Collateral
relates.  Each Grantor agrees to provide such information to the Collateral
Agent promptly upon request.  Each Grantor also ratifies its authorization for
the Collateral Agent to file in any relevant jurisdiction any initial financing
statements or amendments thereto if filed prior to the date hereof.

(b)  The Collateral Agent is further authorized to file with the United States
Patent and Trademark Office or United States Copyright Office (or any successor
office or any similar office in any other country) such documents as may be
necessary or advisable for the purpose of perfecting, confirming, continuing,
enforcing or protecting any security interest granted by any Grantor in any
Material Intellectual Property, without the signature of such Grantor, and
naming such Grantor or the Grantors as debtors and the Collateral Agent as
secured party.

(c)  The Collateral Agent is further authorized to file with the Federal
Aviation Administration (or any successor office or any similar office in any
other country) such documents as may be necessary or advisable for the purpose
of perfecting, confirming, continuing, enforcing or protecting any security
interest granted by any Grantor in any Aircraft and naming such Grantor or the
Grantors as debtors and the Collateral Agent as secured party.

SECTION 5.03.  Representations and Warranties.  The Grantors jointly and
severally represent and warrant to the Collateral Agent and the Secured Parties
that each Grantor has good and valid rights (including ownership rights) in the
material Article 9 Collateral with respect to which it has purported to grant a
security interest hereunder.

 

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SECTION 5.04.  Covenants.  (a)  Each Grantor agrees promptly (and in any event
within 30 days) to notify the Collateral Agent in writing of any change (i) in
its corporate name, (ii) in the location of its chief executive office, (iii) in
its identity or type of organization or corporate structure and (iv) in its
Federal Taxpayer Identification Number or organizational identification
number.  Each Grantor agrees to furnish the Collateral Agent at least 10
Business Day (or such shorter period as the Collateral Agent may agree) prior
written notice of any change in its jurisdiction of organization.  Each Grantor
agrees promptly to provide the Collateral Agent with certified organizational
documents reflecting any of the changes described in the first sentence of this
paragraph.

(b)  Each Grantor agrees to maintain, at its own cost and expense, such complete
and accurate records with respect to the Article 9 Collateral owned by it as
shall be consistent with its current practices and in accordance with such
prudent and standard practices used in industries that are the same as or
similar to those in which such Grantor is engaged, but in any event to include
complete accounting records indicating all payments and proceeds received with
respect to any part of the Article 9 Collateral, and, at such time or times as
the Collateral Agent may reasonably request, promptly to prepare and deliver to
the Collateral Agent schedules in form and detail reasonably satisfactory to the
Collateral Agent showing the identity, amount and location of any specified
Article 9 Collateral.

(c)  Each year, at the time of delivery of annual financial statements of the
Company with respect to the preceding fiscal year pursuant to the Credit
Agreement, the Company shall deliver to the Collateral Agent a certificate
executed on behalf of the Company by a Financial Officer and a legal officer of
the Company setting forth the information required pursuant to the Perfection
Certificate (including the Schedules thereto) or confirming that there has been
no change in such information since the date of such certificate or the date of
the most recent certificate delivered pursuant to this paragraph, and setting
forth for any Aircraft owned by any Grantor and not already listed on Schedule I
hereto information sufficient to permit the Collateral Agent to file notices of
its security interests in such Aircraft with the Federal Aviation
Administration, including the model number, the tail number, the name, the
serial number and the location of such Aircraft (and Schedule I shall be
automatically updated to list any Aircraft identified in any such certificate).

(d)  The Collateral Agent and such Persons as the Collateral Agent may
reasonably designate shall have the right, at the Grantors’ own cost and
expense, to inspect the Article 9 Collateral and the premises upon which any of
the Article 9 Collateral is located and to verify under reasonable procedures,
in accordance with the provisions of the Credit Agreement, the validity, amount,
quality, quantity, value, condition and status of, or any other matter relating
to, the Article 9 Collateral, including, only after the occurrence and during
the continuance of an Event of Default, in the case of Accounts or Article 9
Collateral in the possession of any third person, by contacting Account Debtors
or the third person possessing such Article 9 Collateral for the purpose of
making such a verification.  The Collateral Agent shall have the absolute right
to share any information it gains from such inspection or verification with any
Secured Party.

 

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(e)  At its option, the Collateral Agent may discharge past due taxes,
assessments, charges, fees, Liens, security interests or other encumbrances at
any time levied or placed on the Article 9 Collateral and not permitted pursuant
to the Credit Agreement, and may pay for the maintenance and preservation of the
Article 9 Collateral to the extent any Grantor fails to do so as required by the
Credit Agreement or this Agreement, and each Grantor jointly and severally
agrees to reimburse the Collateral Agent on demand for any payment made or any
expense incurred by the Collateral Agent pursuant to the foregoing
authorization; provided that nothing in this paragraph shall be interpreted as
excusing any Grantor from the performance of, or imposing any obligation on the
Collateral Agent or any Secured Party to perform, any covenants or other
promises of any Grantor with respect to taxes, assessments, charges, fees,
Liens, security interests or other encumbrances and maintenance as set forth
herein or in the other Credit Documents.

(f)  The Grantors, at their own expense, shall maintain, or cause to be
maintained, insurance covering physical loss or damage to the Inventory and
Equipment included in the Article 9 Collateral in accordance with the
requirements set forth in the Credit Agreement.  Each Grantor irrevocably makes,
constitutes and appoints the Collateral Agent (and all officers, employees or
agents designated by the Collateral Agent) as such Grantor’s true and lawful
agent (and attorney-in-fact) for the purpose, during the continuance of an Event
of Default, of making, settling and adjusting claims in respect of Article 9
Collateral under policies of insurance, endorsing the name of such Grantor on
any check, draft, instrument or other item of payment for the proceeds of such
policies of insurance and for making all determinations and decisions with
respect thereto.  In the event that any Grantor at any time or times shall fail
to obtain or maintain any of the policies of insurance required hereby or to pay
any premium in whole or part relating thereto, the Collateral Agent may, without
waiving or releasing any obligation or liability of the Grantors hereunder or
any Event of Default, in its sole discretion, obtain and maintain such policies
of insurance and pay such premiums and take any other actions with respect
thereto as the Collateral Agent deems advisable.  All sums disbursed by the
Collateral Agent in connection with this paragraph, including reasonable
attorneys’ fees, court costs, expenses and other charges relating thereto, shall
be payable, upon demand, by the Grantors to the Collateral Agent and shall be
additional Obligations secured hereby.

(g)  Each Grantor shall maintain, in form and manner reasonably satisfactory to
the Collateral Agent, records of its Chattel Paper and its books, records and
documents evidencing or pertaining thereto.

SECTION 5.05.  Other Actions.  In order to further ensure the attachment,
perfection and priority of, and the ability of the Collateral Agent to enforce,
the security interests created hereby, each Grantor agrees, in each case at such
Grantor’s own expense, to take the following actions with respect to the
following Article 9 Collateral:  if any Grantor shall at any time hold or
acquire any Instrument representing Indebtedness in excess of $3,000,000, such
Grantor shall forthwith endorse, assign and deliver the same to the Collateral
Agent, accompanied by such instruments of transfer or assignment duly executed
in blank as the Collateral Agent may from time to time reasonably request.

 

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SECTION 5.06.  Covenants Regarding Patent, Trademark and Copyright
Collateral.  (a)  Each Grantor agrees that it will not do or omit to do any act
(and will exercise commercially reasonable efforts to prevent its licensees from
doing or omitting to do any act) whereby any Patent constituting Material
Intellectual Property may become invalidated or dedicated to the public, and
agrees that it shall continue to mark any products covered by such Patent with
the relevant patent number consistent with good business judgment to establish
and preserve its rights under applicable patent laws.

(b)  Each Grantor (either itself or through its licensees or its sublicensees)
will, for each Trademark constituting Material Intellectual Property,
(i) maintain such Trademark in full force free from any claim of abandonment or
invalidity for non-use, (ii) maintain the quality of products and services
offered under such Trademark, (iii) display such Trademark with notice of
Federal or foreign registration consistent with good business judgment to
establish and preserve its rights under applicable law and (iv) not knowingly
use or knowingly permit the use of such Trademark in violation of any third
party rights.

(c)  Each Grantor (either itself or through its licensees or sublicensees) will,
for each work covered by a Copyright constituting Material Intellectual
Property, continue to publish, reproduce, display, adopt and distribute the work
with appropriate copyright notice consistent with good business judgment to
establish and preserve its rights under applicable copyright laws.

(d)  Each Grantor shall notify the Collateral Agent promptly if it knows or has
reason to know that any Patent, Trademark or Copyright constituting Material
Intellectual Property may become abandoned, lost or dedicated to the public, or
of any materially 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, United States Copyright Office or
any court or similar office of any country) regarding such Grantor’s ownership
of any Patent, Trademark or Copyright, its right to register the same, or its
right to keep and maintain the same; provided that such notification need not be
given if such impairment of such Intellectual Property is not material viewed
against the Material Intellectual Property as a whole.

(e)  Each Grantor will take all steps consistent with good business judgment
that are consistent with the practice in any proceeding before the United States
Patent and Trademark Office, United States Copyright Office or any office or
agency in any political subdivision of the United States or in any other country
or any political subdivision thereof, to maintain and pursue each application
relating to the Patents, Trademarks and/or Copyrights constituting Material
Intellectual Property (and to obtain the relevant grant or registration) and to
maintain each issued Patent and each registration of the Trademarks and
Copyrights constituting Material Intellectual Property, including timely filings
of applications for renewal, affidavits of use, affidavits of incontestability
and payment of maintenance fees, and, if consistent with good business judgment,
to initiate opposition, interference and cancelation proceedings against third
parties.

 

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(f)  Upon and during the continuance of an Event of Default, each Grantor shall
endeavor in good faith to obtain all requisite consents or approvals by the
licensor of each Copyright License, Patent License or Trademark License to
effect the assignment of all such Grantor’s right, title and interest thereunder
to the Collateral Agent or its designee.

SECTION 5.07.  Lockbox System.   (a)   The Grantors shall maintain, subject to
the control of the Collateral Agent pursuant to the Account Control Agreements,
a system of lockboxes and related Deposit Accounts (the “Lockbox System”).  Each
Grantor agrees that it shall have no Deposit Accounts other than (A) Deposit
Accounts in the Lockbox System, (B) Excluded Operating Accounts and (C) Local
Collection Accounts.  Each Grantor further agrees (i) to cause at all times to
be in effect with respect to each Deposit Account Institution at which any
Deposit Account (other than an Excluded Operating Account or a Local Collection
Account) is maintained an Account Control Agreement with respect to each such
Deposit Account, (ii) to notify and direct promptly each Account Debtor and
every other Person obligated to make payments on Accounts or in respect of any
Inventory to make all such payments directly to one or more Deposit Accounts in
the Lockbox System (or, in the case of Accounts or Inventory of the Company’s
retail division (including both consumer and commercial), Local Collection
Accounts) or related lockboxes, (iii) to use all reasonable efforts to cause
each such Account Debtor and other Person to make all payments with respect to
Accounts and Inventory directly to one or more Deposit Accounts in the Lockbox
System (or, in the case of Accounts or Inventory of the Company’s retail
division (including both consumer and commercial), Local Collection Accounts) or
related lockboxes, (iv) promptly to deposit all payments received by it on
account of Accounts and Inventory, whether in the form of cash, checks, notes,
drafts, bills of exchange, money orders or otherwise, in one or more Deposit
Accounts in the Lockbox System (or, in the case of Accounts or Inventory of the
Company’s retail division (including both consumer and commercial), Local
Collection Accounts) or related lockboxes in the form in which received (but
with any endorsements of such Grantor necessary for deposit or collection),
(v) to maintain at all times a Collateral Proceeds Account in the United States,
a U.S. dollar Collateral Proceeds Account in Canada and a Canadian dollar
Collateral Proceeds Account in Canada, in each case on terms reasonably
satisfactory to the Collateral Agent, (vi) to cause all funds on deposit in
Local Collection Accounts to be remitted periodically, but in no event less
frequently than weekly, to a Deposit Account in the Lockbox System which is
subject to an Account Control Agreement, and (vii) to maintain in effect
agreements with the applicable Deposit Account Institutions under which amounts
on deposit in each Deposit Account (other than Excluded Operating Accounts and
Local Collection Accounts) located in the United States and in Canada will not
less often than weekly be paid to the Collateral Agent for deposit in same day
funds in the Collateral Proceeds Account located in the United States or in the
Collateral Proceeds Account in Canada; provided, that so long as no Event of
Default has occurred and is continuing, the Grantors shall be permitted to
retain in the Deposit Accounts (including Local Collection Accounts, but
excluding (I) Excluded Operating Accounts and (II) each Collateral Proceeds
Account) which are subject to clauses (vi) and (vii) above, an amount, in the
aggregate for all such Deposit Accounts, not to exceed $10,000,000, which amount
is to be calculated following the sweep of any such Deposit Account on

 

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each date for which the standing instructions to sweep such Deposit Account are
applicable.  So long as no Event of Default has occurred and is continuing, the
Collateral Agent shall promptly (and no less frequently than each Business Day)
remit any funds on deposit in each Collateral Proceeds Account to one or more
accounts of the Company that have been designated by the Company.  Effective
upon notice to the Company after the occurrence and during the continuance of an
Event of Default, each Collateral Proceeds Account and each Deposit Account
(other than Excluded Operating Accounts and Local Collection Accounts) will,
without further action on the part of any Grantor or the Collateral Agent,
convert into a closed lockbox account under the sole dominion and control of the
Collateral Agent in which all funds are held subject to the rights of the
Collateral Agent hereunder.  Without the prior written consent of the Collateral
Agent, no Grantor shall, in a manner adverse to the Secured Parties, change the
general instructions given to Account Debtors in respect of payments to be
deposited in the Lockbox System.  Each Grantor irrevocably authorizes the
Collateral Agent, upon the occurrence of an Event of Default, to deliver a
Control Notice under each Account Control Agreement.  The Collateral Agent
agrees with each Grantor that the Collateral Agent shall not give any
instructions pursuant to any Account Control Agreement terminating such Account
Control Agreement or the right of such Grantor to make withdrawals from any
Deposit Account in the Lockbox System unless an Event of Default shall have
occurred and be continuing or, after giving effect to any withdrawal, would
occur.

SECTION 5.08.  Insurance.  Each Grantor shall cause the Collateral Agent to be
named as loss payee on all property insurance maintained in respect of property
subject to the Mortgages.

SECTION 5.09.  Securities Accounts.  If any securities, whether certificated or
uncertificated, or other investment property now or hereafter acquired by any
Grantor are held by such Grantor or its nominee in an account with a securities
intermediary, such Grantor shall promptly notify the Collateral Agent thereof
and, at the Collateral Agent’s request and option, pursuant to an agreement in
form and substance reasonably satisfactory to the Administrative Agent, cause
such securities intermediary to agree to comply with entitlement orders or other
instructions from the Collateral Agent to such securities intermediary as to
such security entitlements without further consent of any Grantor, such nominee,
or any other Person (each such agreement, a “Securities Account Control
Agreement”).  The Collateral Agent agrees with each of the Grantors that the
Collateral Agent shall not give any such entitlement orders or instructions or
directions to any such issuer or securities intermediary unless an Event of
Default has occurred and is continuing.

 

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ARTICLE VI

Other Pledges, Mortgages and Security Interests

SECTION 6.01.  Other Security Documents.  In addition to the security interests
created under Articles IV and V, the parties acknowledge that:

(a)  The applicable Grantors and the Collateral Agent are parties to the Foreign
Pledge Agreements listed in Schedule II under which such Grantors have pledged
(and the applicable Grantors may in the future enter into additional Foreign
Pledge Agreements under which such Grantors may pledge) Equity Interests in
Foreign Subsidiaries owned by them on a senior basis to secure the Obligations.

(b)  The Grantors and the Collateral Agent are parties to the Mortgages as
listed in Schedule III, under which they have mortgaged the real properties and
interests in the Mortgaged Properties to secure the Obligations.

(c)  Certain Grantors that are organized under the laws of Canada or one or more
provinces thereof are entering into the Canadian Security Agreements, under
which they are creating security interests in certain Collateral owned by them
to secure the Obligations.

SECTION 6.02.  Other Security Documents Subject to This Agreement.  (a)   The
parties hereto and to the Other Security Documents agree that they will observe
and be bound by, and that the Other Security Documents will in all respects be
subject to, the following provisions:  (i) to the extent applicable, the
provisions of Section 5.01(c) (limiting the amount of the obligations secured by
the Indenture Properties owned by the Company); (ii) the provisions of Sections
7.02 and 7.03 (governing the exercise of remedies under the Other Security
Documents and the distribution of the proceeds realized from the exercise of
remedies under the Security Documents); (iii) the provisions of Articles IX and
X (relating to the duties and responsibilities of the Collateral Agent); and
(iv) the provisions of Section 12.13 (providing for releases of Guarantees of
and Collateral securing the Obligations).

(b)  Each of the Mortgages (other than any Mortgage that sets forth in full the
provisions referred to in clauses (i) through (iv) of paragraph (a) above)
contains or, with respect to any future mortgage, shall contain a provision
substantially to the effect set forth below (in the language of such Mortgage)
and satisfactory to the Collateral Agent and its counsel:

“THIS AGREEMENT AND THE PLEDGES, SECURITY INTERESTS AND OTHER LIENS AND CHARGES
CREATED HEREBY ARE SUBJECT IN ALL RESPECTS TO THE PROVISIONS OF THE FIRST LIEN
GUARANTEE AND COLLATERAL AGREEMENT DATED AS OF APRIL 8, 2005, AS AMENDED, AMONG
THE GOODYEAR TIRE & RUBBER COMPANY, CERTAIN OF ITS SUBSIDIARIES AND JPMORGAN
CHASE BANK, N.A., AS COLLATERAL AGENT, AND ANY PROVISION OF THIS AGREEMENT THAT
IS INCONSISTENT WITH THE PROVISIONS OF SUCH FIRST LIEN GUARANTEE AND COLLATERAL
AGREEMENT SHALL BE DEEMED FOR ALL PURPOSES TO HAVE BEEN AMENDED TO CONFORM IN
ALL RESPECTS TO SUCH PROVISIONS.”

 

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ARTICLE VII

Remedies

SECTION 7.01.  Remedies Upon Default.  Upon the occurrence and during the
continuance of an Event of Default under and as defined in the Credit Agreement,
to the extent permitted by law, (a) the Collateral Agent may demand that each
Grantor deliver each item of Collateral owned or held by it to the Collateral
Agent, and each Grantor agrees so to deliver all such Collateral, and (b) the
Collateral Agent shall have the right to take any of or all the following
actions at the same or different times with respect to any Collateral:  (i) with
respect to any Collateral consisting of Intellectual Property, on demand, to
cause its security interest in such Collateral to become an assignment, transfer
and conveyance of any of or all such Collateral by the applicable Grantors to
the Collateral Agent, or to grant any license or sublicense, whether general,
special or otherwise, and whether on an exclusive or nonexclusive basis, with
respect to any such Collateral throughout the world on such terms and conditions
and in such manner as the Collateral Agent shall determine (other than in
violation of any then-existing licensing arrangements to the extent that waivers
cannot be obtained), and (ii) with or without legal process and with or without
prior notice or demand for performance, to take possession of the Collateral and
without liability for trespass to enter any premises where the Collateral may be
located for the purpose of taking possession of or removing the Collateral and,
generally, to exercise any and all rights afforded to a secured party under the
Uniform Commercial Code or other applicable law.  Without limiting the
generality of the foregoing, each Grantor agrees that the Collateral Agent shall
have the right, subject to the mandatory requirements of applicable law, to sell
or otherwise dispose of all or any part of the Collateral at a public or private
sale or at any broker’s board or on any securities exchange, for cash, upon
credit or for future delivery as the Collateral Agent shall deem
appropriate.  The Collateral Agent shall be authorized at any such sale of
securities (if it deems it advisable to do so) to restrict the prospective
bidders or purchasers to Persons who will represent and agree that they are
purchasing the Collateral for their own account for investment and not with a
view to the distribution or sale thereof, and upon consummation of any such sale
the Collateral Agent shall have the right to assign, transfer and deliver to the
purchaser or purchasers thereof the Collateral so sold.  Each such purchaser at
any sale of Collateral shall (to the extent permitted by law) hold the property
sold absolutely, free from any claim or right on the part of any Grantor, and
each Grantor hereby waives (to the extent permitted by law) all rights of
redemption, stay and appraisal which such Grantor now has or may at any time in
the future have under any rule of law or statute now existing or hereafter
enacted.

In the case of any Collateral that constitutes Article 9 Collateral, the
Collateral Agent shall give the applicable Grantors 10 days’ prior written
notice (which each Grantor agrees is reasonable notice within the meaning of
Section 9-611 of the New York UCC or its equivalent in other jurisdictions) of
the Collateral Agent’s intention to make any sale of Collateral.  Such notice,
in the case of a public sale, shall state the time and place for such sale and,
in the case of a sale at a broker’s board or on a securities exchange, shall
state the board or exchange at which such sale is to be made and the day on
which the Collateral, or portion thereof, will first be offered for sale at such
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exchange.  Any such public sale shall be held at such time or times within
ordinary business hours and at such place or places as the Collateral Agent may
fix and state in the notice (if any) of such sale.  At any such sale, the
Collateral, or portion thereof, to be sold may be sold in one lot as an entirety
or in separate parcels, as the Collateral Agent may (in its sole and absolute
discretion) determine.  The Collateral Agent shall not be obligated to make any
sale of any Collateral if it shall determine not to do so, regardless of the
fact that notice of sale of such Collateral shall have been given.  The
Collateral Agent may, without notice or publication, adjourn any public or
private sale or cause the same to be adjourned from time to time by announcement
at the time and place fixed for sale, and such sale may, without further notice,
be made at the time and place to which the same was so adjourned.  In case any
sale of all or any part of the Collateral is made on credit or for future
delivery, the Collateral so sold may be retained by the Collateral Agent until
the sale price is paid by the purchaser or purchasers thereof, but the
Collateral Agent shall not incur any liability in case any such purchaser or
purchasers shall fail to take up and pay for the Collateral so sold and, in case
of any such failure, such Collateral may be sold again upon like notice.  At any
public (or, to the extent permitted by law, private) sale made pursuant to this
Agreement, any Secured Party may bid for or purchase, free (to the extent
permitted by law) from any right of redemption, stay, valuation or appraisal on
the part of any Grantor (all said rights being also hereby waived and released
to the extent permitted by law), the Collateral or any part thereof offered for
sale and may make payment on account thereof by using any claim then due and
payable to such Secured Party from any Grantor as a credit against the purchase
price, and such Secured Party may, upon compliance with the terms of sale, hold,
retain and dispose of such property without further accountability to any
Grantor therefor (to the extent permitted by law).  For purposes hereof, a
written agreement to purchase any Collateral or portion thereof shall be treated
as a sale thereof; the Collateral Agent shall be free to carry out such sale
pursuant to such agreement and no Grantor shall be entitled to the return of the
Collateral or any portion thereof subject thereto, notwithstanding the fact that
after the Collateral Agent shall have entered into such an agreement all Events
of Default shall have been remedied and the Obligations paid in full.  As an
alternative to exercising the power of sale herein conferred upon it, the
Collateral Agent may proceed by a suit or suits at law or in equity to foreclose
this Agreement and to sell the Collateral or any portion thereof pursuant to a
judgment or decree of a court or courts having competent jurisdiction or
pursuant to a proceeding by a court-appointed receiver.  Any sale pursuant to
the provisions of this Section shall be deemed to conform to the commercially
reasonable standards as provided in Section 9-610(b) of the New York UCC or its
equivalent in other jurisdictions.

SECTION 7.02.  Exercise of Remedies under Other Security Documents.  The
Collateral Agent shall also have the right to exercise remedies provided for in
each Other Security Document upon the occurrence and during the continuance of
an Event of Default.

SECTION 7.03.  Application of Proceeds.  (a)  Unless otherwise required by
applicable law, the Collateral Agent shall apply the proceeds of the collection
or sale of any Collateral, including any Collateral consisting of cash, as
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FIRST, to the payment of all costs and expenses incurred by the Collateral Agent
in connection with such collection or sale or otherwise in connection with this
Agreement or any other Credit Document, or otherwise in connection with any of
the Obligations, including all court costs and the fees and expenses of its
agents and legal counsel, the repayment of all advances made by the Collateral
Agent hereunder or under any other Credit Document on behalf of any Grantor and
any other costs or expenses incurred in connection with the exercise of any
right or remedy hereunder or under any other Credit Document at the direction or
for the benefit of holders of the Obligations;

SECOND, to the payment of all such Obligations as shall be owed to the
Administrative Agent (in such capacity) and all such Obligations for fees,
indemnification or the reimbursement of expenses as shall be owed to any Issuing
Bank;

THIRD, to the payment in full of the other Obligations (other than Miscellaneous
Obligations) secured by such Collateral, ratably in accordance with the amounts
of such Obligations on the date of such application;

FOURTH, to the payment in full of any Miscellaneous Obligations (other than the
Miscellaneous Obligations described in clause (c) of the definition of
Miscellaneous Obligations) secured by such Collateral, ratably in accordance
with the amounts of such Obligations on the date of such application;

FIFTH, to the payment in full of any Miscellaneous Obligations described in
clause (c) of the definition of Miscellaneous Obligations secured by such
Collateral, ratably in accordance with the amounts of such Obligations on the
date of such application;

SIXTH, to the “Collateral Agent” under and as defined in the Second Lien
Guarantee and Collateral Agreement for application as provided therein to
satisfy obligations secured by Liens on the Collateral created thereunder or
under the “Other Security Documents” (as defined therein) that are junior to the
Liens created hereunder and under the Other Security Documents;

SEVENTH, if the Second Lien Guarantee and Collateral Agreement shall no longer
be in effect or if the Collateral Agent shall be advised by the “Collateral
Agent” under and as defined in the Second Lien Guarantee and Collateral
Agreement that there are no persons entitled under the Second Lien Guarantee and
Collateral Agreement to receive such proceeds or cash, to the Junior Collateral
Agents (as such term is defined in the Lien Subordination and Intercreditor
Agreement) for application as provided in the Lien Subordination and
Intercreditor Agreement; and

 

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EIGHTH, if there shall be no outstanding “Junior Obligations”, as defined in the
Lien Subordination and Intercreditor Agreement, or if the Collateral Agent shall
be advised by each Junior Collateral Agent (as such term is defined in the Lien
Subordination and Intercreditor Agreement) that there are no persons entitled
under the documents governing “Junior Obligations”, as defined in the Lien
Subordination and Intercreditor Agreement, to receive such proceeds or cash, to
the applicable Grantors, their successors or assigns, or as a court of competent
jurisdiction may otherwise direct.

The Collateral Agent shall have absolute discretion as to the time of
application of any such proceeds, moneys or balances in accordance with this
Agreement.  Upon any sale of Collateral by the Collateral Agent (including
pursuant to a power of sale granted by statute or under a judicial proceeding),
the receipt of the Collateral Agent or of the officer making the sale shall be a
sufficient discharge to the purchaser or purchasers of the Collateral so sold
and such purchaser or purchasers shall not be obligated to see to the
application of any part of the purchase money paid over to the Collateral Agent
or such officer or be answerable in any way for the misapplication
thereof.  Notwithstanding the provisions of clause THIRD above, any Article 9
Collateral consisting of cash deposited to collateralize Letter of Credit
reimbursement obligations pursuant to the Credit Agreement will be applied first
against such reimbursement obligations.  

SECTION 7.04.  Grant of License to Use Intellectual Property.  Each Grantor
hereby grants to the Collateral Agent, to the extent necessary to enable the
Collateral Agent to exercise rights and remedies under this Agreement and the
Other Security Documents at such time as the Collateral Agent shall be lawfully
entitled to exercise such rights and remedies, an irrevocable, nonexclusive
license (exercisable without payment of royalty or other compensation to the
Grantors) to use, license or sublicense any Intellectual Property now owned or
hereafter acquired by such Grantor, and wherever the same may be located,
including in such license reasonable access to all media in which any of the
licensed items may be recorded or stored and to all computer software and
programs used for the compilation or printout thereof, to the extent and only to
the extent such license would not violate or result in a default under any
license or other agreement, whether express or implied, between the Grantor and
any Person other than a Wholly Owned Subsidiary.  The rights of the Collateral
Agent under such license may be exercised, at the option of the Collateral
Agent, solely upon the occurrence and during the continuation of an Event of
Default; provided that any license, sublicense or other transaction entered into
by the Collateral Agent in accordance herewith shall be binding upon the
Grantors notwithstanding any subsequent cure of any Event of Default.

SECTION 7.05.  Securities Act.  In view of the position of the Grantors in
relation to the Pledged Collateral, or because of other current or future
circumstances, a question may arise under the Securities Act of 1933, as now or
hereafter in effect, or any similar statute hereafter enacted analogous in
purpose or effect (such Act and any such similar statute as from time to time in
effect being called the “Federal Securities Laws”) with respect to any
disposition of the Pledged Collateral permitted hereunder.  Each Grantor
understands that compliance with the Federal Securities Laws might very strictly

 

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limit the course of conduct of the Collateral Agent if the Collateral Agent were
to attempt to dispose of all or any part of the Pledged Collateral, and might
also limit the extent to which or the manner in which any subsequent transferee
of any Pledged Collateral could dispose of the same.  Similarly, there may be
other legal restrictions or limitations affecting the Collateral Agent in any
attempt to dispose of all or part of the Pledged Collateral under applicable
Blue Sky or other state securities laws or similar laws analogous in purpose or
effect.  Each Grantor recognizes that in light of such restrictions and
limitations the Collateral Agent may, with respect to any sale of the Pledged
Collateral, limit the purchasers to those who will agree, among other things, to
acquire such Pledged Collateral for their own account, for investment, and not
with a view to the distribution or resale thereof.  Each Grantor acknowledges
and agrees that in light of such restrictions and limitations, the Collateral
Agent, in its sole and absolute discretion (a) may proceed to make such a sale
whether or not a registration statement for the purpose of registering such
Pledged Collateral or part thereof shall have been filed under the Federal
Securities Laws and (b) may approach and negotiate with a single potential
purchaser to effect such sale.  Each Grantor acknowledges and agrees that any
such sale might result in prices and other terms less favorable than if such
sale were a public sale without such restrictions.  In the event of any such
sale, the Collateral Agent shall incur no responsibility or liability for
selling all or any part of the Pledged Collateral at a price that the Collateral
Agent, in its sole and absolute discretion, may in good faith deem reasonable
under the circumstances, notwithstanding the possibility that a substantially
higher price might have been realized if the sale were deferred until after
registration as aforesaid or if more than a single purchaser were
approached.  The provisions of this Section will apply notwithstanding the
existence of a public or private market upon which the quotations or sales
prices may exceed substantially the price at which the Collateral Agent sells.

SECTION 7.06.  Registration.  Each Grantor agrees that, upon the occurrence and
during the continuance of an Event of Default, if for any reason the Collateral
Agent desires to sell any of the Pledged Collateral at a public sale, it will,
at any time and from time to time, upon the written request of the Collateral
Agent, use its best efforts to take or to cause the issuer of such Pledged
Collateral to take such action and prepare, distribute and/or file such
documents, as are required or advisable in the reasonable opinion of counsel for
the Collateral Agent to permit the public sale of such Pledged Collateral under
applicable law.  Each Grantor further agrees to indemnify, defend and hold
harmless the Collateral Agent, each other Secured Party, any underwriter and
their respective officers, directors, affiliates and controlling persons from
and against all loss, liability, expenses, costs of counsel (including, without
limitation, reasonable fees and expenses of the Collateral Agent’s legal
counsel), and claims (including the costs of investigation) that they may incur
insofar as such loss, liability, expense or claim arises out of or is based upon
any alleged untrue statement of a material fact contained in any prospectus (or
any amendment or supplement thereto) or in any notification or offering circular
relating to the offering for sale of any Pledged Collateral, or arises out of or
is based upon any alleged omission to state a material fact required to be
stated therein or necessary to make the statements in any thereof not
misleading, except insofar as the same may have been caused by any untrue
statement or omission based upon information furnished in writing to such
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Collateral Agent or any other Secured Party expressly for use therein.  Each
Grantor further agrees, upon such written request referred to above, to use its
best efforts to qualify, file or register, or cause the issuer of such Pledged
Collateral to qualify, file or register, any of the Pledged Collateral under the
Blue Sky or other securities laws of such jurisdictions as may be requested by
the Collateral Agent and keep effective, or cause to be kept effective, all such
qualifications, filings or registrations.  Each Grantor will bear all costs and
expenses of carrying out its obligations under this Section.  Each Grantor
acknowledges that there is no adequate remedy at law for failure by it to comply
with the provisions of this Section and that such failure would not be
adequately compensable in damages, and therefore agrees that its agreements
contained in this Section may be specifically enforced.

ARTICLE VIII

Indemnity, Subrogation and Subordination

SECTION 8.01.  Indemnity and Subrogation.  In addition to all such rights of
indemnity and subrogation as the Grantors and Guarantors may have under
applicable law (but subject to Section 8.03), the Company agrees that (a) in the
event a payment shall be made by any Guarantor under this Agreement in respect
of an Obligation of the Company or of any Subsidiary other than such Guarantor
or one of its Subsidiaries, the Company shall indemnify such Guarantor for the
full amount of such payment and such Guarantor shall be subrogated to the rights
of the Person to whom such payment shall have been made to the extent of such
payment and (b) in the event any assets of any Grantor shall be sold pursuant to
this Agreement or any Other Security Document to satisfy in whole or in part an
Obligation of the Company or of any Subsidiary other than such Grantor or one of
its Subsidiaries, the Company shall indemnify such Grantor in an amount equal to
the greater of the book value or the fair market value of the assets so sold.

SECTION 8.02.  Contribution and Subrogation.  Each Guarantor and Grantor, other
than the Company, that has guaranteed, or granted Liens to secure, the
Obligations (a “Contributing Party”) agrees (subject to Section 8.03) that, in
the event (a) a payment shall be made by any other Guarantor (other than the
Company) hereunder in respect of any Obligations or (b) assets of any other
Grantor (other than the Company) shall be sold pursuant to any Security Document
to satisfy any Obligations, and such other Guarantor or Grantor (the “Claiming
Party”) shall not have been fully indemnified by the Company as provided in
Section 8.01, the Contributing Party shall indemnify the Claiming Party in an
amount equal to the amount of such payment or the greater of the book value or
the fair market value of such assets, as the case may be, in each case
multiplied by a fraction of which the numerator shall be the net worth of the
Contributing Party and the denominator shall be the aggregate net worth of all
the Guarantors and Grantors, other than the Company.  For the purposes of the
previous sentence, the net worth of each Guarantor and Grantor shall be
determined on the date hereof (or, in the case of any Guarantor or Grantor
becoming a Guarantor or Grantor after the date hereof, the date on which such
Guarantor or Grantor shall have become a Guarantor or Grantor).  Any
Contributing Party making any payment to a Claiming Party pursuant to this
Section shall be subrogated to the rights of such Claiming Party under
Section 8.01 to the extent of such payment.

 

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SECTION 8.03.  Subordination.  (a)  Notwithstanding any provision of this
Agreement to the contrary, all rights of the Guarantors and Grantors under
Sections 8.01 and 8.02 and all other rights of indemnity, contribution or
subrogation under applicable law or otherwise shall be fully subordinated to the
indefeasible payment in full in cash of the Obligations, and no Guarantor or
Grantor shall seek to enforce any of such rights until the Obligations have been
paid in full.  No failure on the part of the Company or any other Guarantor or
Grantor to make the payments required by Sections 8.01 and 8.02 (or any other
payments required under applicable law or otherwise) shall in any respect limit
the obligations and liabilities of any Guarantor or Grantor with respect to its
obligations hereunder, and each Guarantor and Grantor shall remain liable for
the full amount of the obligations of such Guarantor or Grantor hereunder.

ARTICLE IX

Duties of Collateral Agent

SECTION 9.01.  Actions Under This Agreement.  (a)  The Collateral Agent shall
not be obligated to take any action under this Agreement or any Other Security
Document except for the performance of such duties as are specifically set forth
herein and therein.  Subject to the provisions of Article X of this Agreement
and to the succeeding provisions of this Section, the Collateral Agent shall
take such actions, and only such actions, under this Agreement and the Other
Security Documents with respect to any Collateral as are requested by the
Administrative Agent, on behalf of the Majority Lenders, under the Credit
Agreement and as are not inconsistent with or contrary to the provisions of this
Agreement, any Other Security Document or the Credit Agreement, as well as
ministerial and/or administrative actions required or permitted by this
Agreement and the Other Security Documents.

(b)  The holders of the Miscellaneous Obligations shall not be entitled to, and
shall not, (i) direct the actions of the Collateral Agent hereunder, (ii) take
any action, or commence any legal proceeding seeking, to require, compel or
cause the Collateral Agent to enforce any provisions of this Agreement against
any Guarantor or Grantor or to exercise any remedy hereunder, (iii) take any
action, or commence any legal proceeding seeking, to prevent or enjoin the
Collateral Agent from taking any action (including, without limitation, the
enforcement of any provisions of this Agreement against any Guarantor or
Grantor, the exercise of any remedy hereunder, the release of any Guarantee or
Collateral hereunder or the consent to any amendment or modification of this
Agreement or the grant of any waiver hereunder), or refraining from taking any
such action, in accordance with this Agreement or (iv) take any action, or
commence any legal proceeding seeking, to delay, hinder or otherwise impair the
Collateral Agent in taking any such action in accordance with this
Agreement.  By their acceptance of the benefits of this Agreement and the Other
Security Documents, the holders of the Miscellaneous Obligations will be deemed
to have acknowledged and agreed to the provisions of the preceding sentence, and
to have acknowledged that such provisions are being relied upon by the other
Secured Parties.

 

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(c)  THE COLLATERAL AGENT HAS CONSENTED TO SERVE AS COLLATERAL AGENT HEREUNDER
ON THE EXPRESS UNDERSTANDING, AND THE HOLDERS OF THE OBLIGATIONS, BY ACCEPTING
THE BENEFITS OF THIS AGREEMENT, SHALL BE DEEMED TO HAVE AGREED, THAT THE
COLLATERAL AGENT SHALL HAVE NO DUTY AND SHALL OWE NO OBLIGATION OR
RESPONSIBILITY (FIDUCIARY OR OTHERWISE) TO THE HOLDERS OF ANY OBLIGATIONS, OTHER
THAN THE DUTY TO PERFORM ITS EXPRESS OBLIGATIONS UNDER THIS AGREEMENT IN
ACCORDANCE WITH THEIR TERMS, SUBJECT IN ALL EVENTS TO THE PROVISIONS OF ARTICLE
X AND THE OTHER PROVISIONS OF THIS AGREEMENT LIMITING THE RESPONSIBILITY OR
LIABILITY OF THE COLLATERAL AGENT HEREUNDER.  WITHOUT LIMITING THE FOREGOING,
THE HOLDERS OF THE MISCELLANEOUS OBLIGATIONS, BY ACCEPTING THE BENEFITS OF THIS
AGREEMENT AND THE OTHER SECURITY DOCUMENTS, SHALL BE DEEMED TO HAVE WAIVED ANY
RIGHT THEY MIGHT HAVE, UNDER APPLICABLE LAW OR OTHERWISE, TO COMPEL THE SALE OR
OTHER DISPOSITION OF ANY COLLATERAL, AND ANY OBLIGATION THE COLLATERAL AGENT
MIGHT HAVE, UNDER APPLICABLE LAW OR OTHERWISE, TO OBTAIN ANY MINIMUM PRICE FOR
ANY COLLATERAL UPON THE SALE THEREOF, IT BEING EXPRESSLY UNDERSTOOD, AND THE
AVAILABILITY OF THE BENEFITS OF THIS AGREEMENT TO THE HOLDERS OF THE
MISCELLANEOUS  OBLIGATIONS BEING CONDITIONED UPON THE UNDERSTANDING, THAT THE
SOLE RIGHT OF THE HOLDERS OF THE MISCELLANEOUS OBLIGATIONS SHALL BE TO RECEIVE
THEIR RATABLE SHARE OF ANY PROCEEDS OF COLLATERAL IN ACCORDANCE WITH AND SUBJECT
TO THE PROVISIONS OF THIS AGREEMENT.

ARTICLE X

Concerning the Collateral Agent

SECTION 10.01.  Limitations on Responsibility of Collateral Agent.  The
Collateral Agent shall not be responsible in any manner whatsoever for the
correctness of any recitals, statements, representations or warranties contained
herein or in any Other Security Document.  The Collateral Agent makes no
representation as to the value or condition of the Collateral or any part
thereof, as to the title of any Grantor to the Collateral, as to the security
afforded by this Agreement or any Other Security Document or as to the validity,
execution, enforceability, legality or sufficiency of this Agreement or any
Other Security Document, and the Collateral Agent shall incur no liability or
responsibility in respect of any such matters.  The Collateral Agent shall not
be responsible for insuring the Collateral, for the payment of taxes, charges,
assessments or Liens upon the Collateral or otherwise for the maintenance of the
Collateral, except as provided in the immediately following sentence when the
Collateral Agent has possession or control of the Collateral.  Except as
otherwise provided herein, the Collateral Agent shall have no duty to the
Grantors or to the holders of the Obligations as to any Collateral in its
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or nominee of the Collateral Agent or any income thereon or as to the
preservation of rights against prior parties or any other rights pertaining
thereto, except the duty to accord such Collateral the same care that it
normally accords to its own assets and the duty to account for moneys received
by it.  The Collateral Agent shall not be required to ascertain or inquire as to
the performance by any Guarantor or Grantor of any of the covenants or
agreements contained herein or in any other agreement.  Neither the Collateral
Agent nor any officer, agent or representative thereof shall be personally
liable for any action taken or omitted to be taken by any such person in
connection with this Agreement or any Other Security Document except for such
person’s own gross negligence or wilful misconduct (it being understood that any
action taken in accordance with the terms of this Agreement or any Other
Security Document by the Collateral Agent or any such officer, agent or
representative at the direction or instruction of the Administrative Agent or
the Majority Lenders under the Credit Agreement (or not taken in the absence of
any such directions or instructions) shall not constitute gross negligence or
wilful misconduct).  Neither the Collateral Agent nor any officer, agent or
representative thereof shall be personally liable for any action taken by any
such person in accordance with any notice given by the Administrative Agent or
the Majority Lenders under the Credit Agreement hereunder or under any Other
Security Document even if, at the time such action is taken by any such Person,
the Administrative Agent or the Lenders which gave the notice to take such
action shall no longer be the Administrative Agent or the Majority Lenders under
the Credit Agreement or the Secured Parties on behalf of which such notice was
given are no longer the Secured Parties.  The Collateral Agent may execute any
of the powers granted under this Agreement and perform any duty hereunder either
directly or by or through agents or attorneys-in-fact.

SECTION 10.02.  Reliance by Collateral Agent; Indemnity Against Liabilities,
etc.  (a)  Whenever in the performance of its duties under this Agreement or any
Other Security Document the Collateral Agent shall deem it necessary or
desirable that a matter be proved or established with respect to any Grantor or
any other person in connection with the taking, suffering or omitting of any
action hereunder by the Collateral Agent, such matter may be conclusively deemed
to be proved or established by a certificate executed by an officer of such
Person which is believed by the Collateral Agent to be genuine and to have been
signed or sent by the proper Person, and the Collateral Agent shall have no
liability with respect to any action taken, suffered or omitted in reliance
thereon.

(b)  The Collateral Agent may consult with counsel and shall not incur any
liability in taking any action hereunder or under any Other Security Document in
good faith in accordance with any advice of such counsel.  The Collateral Agent
shall have the right but not the obligation at any time to seek instructions
concerning the administration of this Agreement or any Other Security Document,
the duties created hereunder or the Collateral from any court of competent
jurisdiction.

(c)  The Collateral Agent shall not incur any liability in relying upon any
resolution, statement, certificate, instrument, opinion, report, notice,
request, consent, order or other paper or document which it in good faith
believes to be genuine and to have been signed or presented by the proper
party.  The Collateral Agent may

 

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conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon any certificate or opinions that are believed
by the Collateral Agent to be genuine and signed or furnished by the proper
Person furnished to the Collateral Agent in connection with this Agreement or
any Other Security Document.

(d)  The Collateral Agent shall not be deemed to have actual, constructive,
direct or indirect notice or knowledge of the occurrence of any Event of Default
unless and until the Collateral Agent shall have received written notice thereof
from the Administrative Agent.  The Collateral Agent shall have no obligation
whatsoever either prior to or after receiving such a notice that is believed by
the Collateral Agent to be genuine and to have been signed or sent by the proper
Person to inquire whether an Event of Default has, in fact, occurred and shall
be entitled to rely conclusively, and shall be fully protected in so relying, on
any such notice so furnished to it.

(e)  If the Collateral Agent has been requested to take any specific action by
the Administrative Agent pursuant to any provision of this Agreement or any
Other Security Document, the Collateral Agent shall not be under any obligation
to exercise any of the rights or powers vested in it by this Agreement or such
Other Security Document in the manner so requested unless it shall have been
provided indemnity by the Secured Parties on whose behalf such request shall
have been made reasonably satisfactory to it against the costs, expenses and
liabilities which may be incurred by it in compliance with such request or
direction.

SECTION 10.03.  Resignation and Removal of the Collateral Agent.  The Collateral
Agent may at any time, by giving 30 days’ prior written notice to the Company
and the Administrative Agent, resign and be discharged from the responsibilities
hereby created, such resignation to become effective upon the appointment of a
successor by the Administrative Agent with, so long as no Event of Default has
occurred and is continuing, the consent of the Company (such consent not to be
unreasonably withheld) and the acceptance of such appointment by such
successor.  If no successor shall be appointed and approved within 30 days after
the date of any such resignation, the Collateral Agent may apply to any court of
competent jurisdiction to appoint a successor to act until a successor shall
have been appointed as above provided or may, on behalf of the Secured Parties,
appoint a successor Collateral Agent which shall be a bank with an office in New
York, New York having a combined capital and surplus of at least $500,000,000.

SECTION 10.04.  Expenses and Indemnification.  By accepting the benefits of this
Agreement, each of the Lenders severally agrees (i) to reimburse the Collateral
Agent, on demand, in the amount of its pro rata share from time to time (based
on the Applicable Percentage of such Lender), of any expenses referred to in
this Agreement or in any Other Security Document securing Obligations owed to
such Lender and/or any other expenses incurred by the Collateral Agent in
connection with the enforcement and protection of the rights of the Collateral
Agent and the Secured Parties which shall not have been paid or reimbursed by
the Company or any other Grantor or Guarantor or paid from the proceeds of any
Collateral as provided herein and (ii) to indemnify and hold harmless the
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respective directors, officers, employees, agents and attorneys (each, an
“Indemnified Party”), on demand, in the amount of such pro rata share, from and
against any and all liabilities, taxes, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements referred to in this
Agreement and/or incurred by the Collateral Agent in connection with this
Agreement or the Other Security Documents or the enforcement and protection of
the rights of the Secured Parties, to the extent the same shall not have been
reimbursed by the Company or any other Grantor or Guarantor or paid from the
proceeds of Collateral as provided herein; provided, in each case, that no
Secured Party shall be liable to any Indemnified Party for any portion of such
expenses, liabilities, taxes, obligations, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements resulting from the gross
negligence or wilful misconduct of such Person.

ARTICLE XI

Subordination of Intercompany Indebtedness

SECTION 11.01.  Subordination.  To the fullest extent permitted under law, the
Company and each other Grantor and Guarantor hereby agrees that all Intercompany
Indebtedness owed to it by any Intercompany Obligor is hereby expressly
subordinated, to the extent and in the manner set forth in this Article, to the
payment in full in cash of all Obligations of such Intercompany Obligor.

SECTION 11.02.  Dissolution or Insolvency.  Upon any dissolution, winding up,
liquidation or reorganization of any Intercompany Obligor, whether in
bankruptcy, insolvency, reorganization, arrangement or receivership proceedings
or otherwise, or upon any assignment for the benefit of creditors or any other
marshalling of the assets and liabilities of any Intercompany Obligor, or
otherwise:

(a) the Secured Parties shall, as between such Secured Parties and the Company
or any other Grantor or Guarantor, first be entitled to receive payment in full
in cash of the Obligations of such Intercompany Obligor in accordance with the
terms of such Obligations before the Company or such Grantor or Guarantor shall
be entitled to receive any payment on account of the Intercompany Indebtedness
of such Intercompany Obligor, whether as principal, interest or otherwise; and

(b) any payment by, or distribution of the assets of, such Intercompany Obligor
of any kind or character, whether in cash, property or securities, to which the
Company or any other Grantor or Guarantor would be entitled except for the
provisions of clause (a) above shall, upon receipt by the Company or such
Grantor or Guarantor, be held in trust (or in a compte de sequestre, if
applicable) for the applicable Secured Parties and promptly paid or delivered
directly to the Collateral Agent for the benefit of such Secured Parties to the
extent necessary to make payment in full in cash of all Obligations remaining
unpaid, after giving effect to any concurrent payment or distribution to such
Secured Parties in respect of such Obligations.

 

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SECTION 11.03.  Subrogation.  Subject to (and only upon) the prior indefeasible
payment in full in cash of all the Obligations, the Company or any other Grantor
or Guarantor holding Intercompany Indebtedness of such Intercompany Obligor
shall be subrogated to the rights of the applicable Secured Parties to receive
payments or distributions in cash, property or securities applicable to such
Obligations until all amounts owing on the Intercompany Indebtedness of such
Intercompany Obligor shall be paid in full, and as between and among such
Intercompany Obligor, its creditors (other than its Secured Parties) and the
Company or any other Grantor or Guarantor holding Intercompany Indebtedness of
such Intercompany Obligor, no such payment or distribution made to the Secured
Parties by virtue of this Agreement that otherwise would have been made to the
Company or any other Grantor or Guarantor in respect of such Intercompany
Indebtedness shall be deemed to be a payment by such Intercompany Obligor on
account of such Intercompany Indebtedness.

SECTION 11.04.  Other Creditors.  Nothing contained in this Article is intended
to or shall impair, as between and among any Intercompany Obligor, its creditors
(other than the Secured Parties) and the Company or any other Grantor or
Guarantor holding Intercompany Indebtedness of such Intercompany Obligor, the
obligations of such Intercompany Obligor to pay its Intercompany Indebtedness as
and when the same shall become due and payable in accordance with the terms
thereof, or affect the relative rights of the Company or any other Grantor or
Guarantor holding Intercompany Indebtedness of such Intercompany Obligor and the
creditors of such Intercompany Guarantor (other than the Secured Parties).

SECTION 11.05.  No Waiver.  No right of any Secured Party to enforce this
Article shall at any time or in any way be prejudiced or impaired by any act or
failure to act on the part of any of the Collateral Agent, the other Secured
Parties, or any Intercompany Obligor, or by any noncompliance by any
Intercompany Obligor with the terms, provisions and covenants contained in this
Agreement, any Other Security Document or the Credit Agreement, and the Secured
Parties are hereby expressly authorized to extend, renew, increase, decrease,
modify or amend the terms of the Obligations or any security therefor, and to
release, sell or exchange any such security and otherwise deal freely with any
Intercompany Obligor, all without notice to or consent of the Company or any
other Grantor or Guarantor and without affecting the liabilities and obligations
of the parties hereto.

SECTION 11.06.  Obligations Hereunder Not Affected.  (a)  All rights and
interests of the Secured Parties under this Article, and all agreements and
obligations of the Company and each other Grantor or Guarantor under this
Article, shall remain in full force and effect irrespective of:

(i)  any lack of validity or enforceability of the Credit Agreement;

(ii)  any change in the time, manner or place of payment of, or in any other
term of, all or any of the Obligations, or any other amendment or waiver of or
consent to departure from the Credit Agreement;

 

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(iii)  any exchange, release or nonperfection of any security interest in any
Collateral, or any release or amendment or waiver of or consent to departure
from any Guarantee, in respect of all or any of the Obligations; or

(iv)  any other circumstance that might otherwise constitute a defense available
to, or a discharge of, any Intercompany Obligor in respect of Obligations or of
the Company or any Grantor or Guarantor in respect of the agreements contained
in this Article.

(b)  The agreements contained in this Article shall continue to be effective or
be reinstated, as the case may be, if at any time any payment of the Obligations
or any part thereof is rescinded or must otherwise be returned by any Secured
Party upon the insolvency, bankruptcy or reorganization of any Intercompany
Obligor or otherwise, all as though such payment had not been made.

(c)  The Company and each Grantor and Guarantor hereby agree that the Secured
Parties may, without affecting or impairing any of the obligations of the
Company or such Grantor or Guarantor hereunder, from time to time to (i) renew,
compromise, extend, increase, accelerate or otherwise change the time for
payment of, or otherwise change the terms of, the Obligations or any part
thereof and (ii) exercise or refrain from exercising any rights against any
Intercompany Obligor or any other Person.

ARTICLE XII

Miscellaneous

SECTION 12.01.  Notices.  All communications and notices hereunder shall (except
as otherwise expressly permitted herein) be given as provided in the Credit
Agreement.  All communications and notices hereunder to any Grantor or Guarantor
other than the Company shall be given to it in care of the Company as provided
in the Credit Agreement.

SECTION 12.02.  Waivers; Amendment. (a)  No failure or delay by the Collateral
Agent or any Secured Party in exercising any right or power hereunder or under
any other Credit Document shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power.  The
rights and remedies of the Collateral Agent and the Secured Parties hereunder
and under the other Credit Documents are cumulative and are not exclusive of any
rights or remedies that they would otherwise have.  No waiver of any provision
of this Agreement or consent to any departure by any Credit Party therefrom
shall in any event be effective unless the same shall be permitted by
paragraph (b) of this Section, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which
given.  Without limiting the generality of the foregoing, no extension of credit
by any Secured Party under the Credit Agreement or otherwise shall be construed
as a waiver of any default hereunder, regardless of whether the Collateral Agent
or any Secured Party may have had notice or knowledge of such default at the
time.  No notice or demand on any Credit Party in any case shall entitle such
Credit Party to any other or further notice or demand in similar or other
circumstances.

 

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(b)  Neither this Agreement nor any provision hereof may be waived, amended or
modified except pursuant to an agreement or agreements in writing entered into
by the Collateral Agent and the Credit Party or Credit Parties with respect to
which such waiver, amendment or modification is to apply, subject to any consent
required under the Credit Agreement.

SECTION 12.03.  Collateral Agent’s Fees and Expenses; Indemnification.  (a)  The
parties hereto agree that the Collateral Agent shall be entitled to
reimbursement of its expenses incurred hereunder as provided in the Credit
Agreement.

(b)  Without limitation of its indemnification obligations under the other
Credit Documents, each Grantor and each Guarantor, to the fullest extent
permitted under law, jointly and severally agrees to indemnify the Collateral
Agent and the other Indemnitees (as defined in the Credit Agreement) against,
and hold each Indemnitee harmless from, any and all losses, claims, damages,
liabilities and related expenses, including reasonable fees, charges and
disbursements of any counsel for any Indemnitee, incurred by or asserted against
any Indemnitee arising out of the execution, delivery or performance of this
Agreement or any agreement or instrument contemplated hereby or any claim,
litigation, investigation or proceeding relating to any of the foregoing or to
the Collateral, whether or not any Indemnitee is a party thereto; provided that
such indemnity shall not, as to any Indemnitee, be available to the extent that
such losses, claims, damages, liabilities or related expenses shall have
resulted from the gross negligence or wilful misconduct of such Indemnitee or
from the breach of any of its obligations set forth in any Credit Document.

(c)  The provisions of this Section shall remain operative and in full force and
effect regardless of the termination of this Agreement or any other Credit
Document, the consummation of the transactions contemplated hereby, the
repayment of any of the Obligations, the invalidity or unenforceability of any
term or provision of this Agreement or any other Credit Document, or any
investigation made by or on behalf of the Collateral Agent or any other Secured
Party.  All amounts due under this Section shall be payable promptly after
written demand therefor.

SECTION 12.04.  Successors and Assigns.  Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the
permitted successors and assigns of such party; and all covenants, promises and
agreements by or on behalf of any Guarantor or Grantor or the Collateral Agent
that are contained in this Agreement shall bind and inure to the benefit of
their respective successors and assigns.

 

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SECTION 12.05.  Survival of Agreement.  All covenants, agreements,
representations and warranties made by the Credit Parties in the Credit
Documents and in the certificates or other instruments prepared or delivered in
connection with or pursuant to this Agreement or any other Credit Document shall
be considered to have been relied upon by the Lenders and shall survive the
execution and delivery of the Credit Documents and the making of any Loans and
issuance of any Letters of Credit, regardless of any investigation made by any
Lender or on its behalf and notwithstanding that the Collateral Agent, any
Issuing Bank or any Lender may have had notice or knowledge of any Default or
incorrect representation or warranty at the time any credit is extended under
the Credit Agreement, and shall, subject to Section 12.13, continue in full
force and effect as long as the principal of or any accrued interest on any Loan
or any fee or any other amount payable under any Credit Document is outstanding
and unpaid or any Letter of Credit is outstanding, and so long as the
Commitments under the Credit Agreement have not expired or terminated.

SECTION 12.06.  Counterparts; Effectiveness; Several Agreement.  This Agreement
may be executed in counterparts, each of which shall constitute an original but
all of which when taken together shall constitute a single contract, and shall
become effective as provided in this Section.  Delivery of an executed signature
page to this Agreement by facsimile transmission shall be as effective as
delivery of a manually signed counterpart of this Agreement.  This Agreement
shall become effective as to any Credit Party when a counterpart hereof executed
on behalf of such Credit Party shall have been delivered to the Collateral Agent
and a counterpart hereof shall have been executed on behalf of the Collateral
Agent, and thereafter shall be binding upon such Credit Party and the Collateral
Agent and their respective permitted successors and assigns, and shall inure to
the benefit of such Credit Party, the Collateral Agent and the other Secured
Parties and their respective successors and assigns, except that no Credit Party
shall have the right to assign or transfer its rights or obligations hereunder
(and any such assignment or transfer shall be void) except as expressly
contemplated by this Agreement.  This Agreement shall be construed as a separate
agreement with respect to each Credit Party and may be amended, modified,
supplemented, waived or released with respect to any Credit Party without the
approval of any other Credit Party and without affecting the obligations of any
other Credit Party hereunder.

SECTION 12.07.  Severability.  Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions hereof; and the invalidity of a particular provision in
a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.  The parties shall endeavor in good-faith negotiations to replace
the invalid, illegal or unenforceable provisions with valid provisions the
economic effect of which comes as close as possible to that of the invalid,
illegal or unenforceable provisions.

 

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SECTION 12.08.  Right of Set-Off.  Without limitation to the provisions of
Section 5.07, if an Event of Default shall have occurred and be continuing and
the Loans shall have become due and payable pursuant to Article VII of the
Credit Agreement, each Lender and each of its Affiliates is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other obligations at any time owing
by such Lender or Affiliate to or for the credit or the account of any Credit
Party against any of and all the obligations of such Credit Party now or
hereafter existing under this Agreement or any other Credit Document and owed to
such Lender, irrespective of whether or not such Lender shall have made any
demand under this Agreement and although such obligations may be unmatured.  The
rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of set-off) that such Lender may have.

SECTION 12.09.  Governing Law; Jurisdiction; Consent to Service of
Process.  (a)  This Agreement shall be construed in accordance with and governed
by the law of the State of New York.

(b)  Each party hereto hereby irrevocably and unconditionally submits, for
itself and its property, to the exclusive jurisdiction of the Supreme Court of
the State of New York sitting in New York County and of the United States
District Court of the Southern District of New York, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement or any other Credit Document, or for recognition or enforcement of any
judgment, and each of the parties hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such New York State or, to the extent permitted by law, in
such Federal court.  Each of the parties hereto agrees that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by
law.  Nothing in this Agreement or any other Credit Document shall affect any
right of the Collateral Agent to bring any action or proceeding relating to any
Collateral in the courts of any jurisdiction where such Collateral is located or
deemed located.

(c)  Each party hereto hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or any other Credit Document in any
court referred to in paragraph (b) of this Section.  Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.

(d)  Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 12.01.  Nothing in this Agreement or
any other Credit Document will affect the right of any party to this Agreement
to serve process in any other manner permitted by law.

 

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SECTION 12.10.  WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT, ANY OTHER CREDIT DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO
(A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS
SECTION.

SECTION 12.11.  Headings.  Article and Section headings and the Table of
Contents used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.

SECTION 12.12.  Security Interest Absolute.  The pledges and security interests
created hereby and by the Other Security Documents shall be absolute and
unconditional irrespective of (a) any lack of validity or enforceability of the
Credit Agreement, any other Credit Document, any agreement with respect to any
of the Obligations or any other agreement or instrument relating to any of the
foregoing, (b) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Obligations, or any other amendment or waiver
of or any consent to any departure from the Credit Agreement, any other Credit
Document or any other agreement or instrument, (c) any exchange, release or
non-perfection of any Lien on other collateral, or any release or amendment or
waiver of or consent under or departure from any guarantee, securing or
guaranteeing all or any of the Obligations, or (d) any other circumstance that
might otherwise constitute a defense available to, or a discharge of, any
Grantor or Guarantor in respect of the Obligations or this Agreement.

SECTION 12.13.  Termination or Release.  (a)  All pledges, security interests
and Liens created hereunder and under the Other Security Documents and all
Guarantees made hereunder shall be automatically released when (i) the principal
of all Loans, all accrued interest and fees and all other Obligations (for the
avoidance of doubt, excluding the Miscellaneous Obligations) due and owing under
the Credit Agreement have been paid in full, (ii) the Lenders have no further
commitment to lend under the Credit Agreement, (iii) the LC Exposures under the
Credit Agreement have been reduced to zero and (iv) the Issuing Banks under the
Credit Agreement have no further obligation to issue Letters of Credit.

 

[[5336199v.2]]

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39

(b)  A Subsidiary shall automatically be released from its obligations as a
Grantor or Guarantor hereunder and under each Other Security Document, and all
pledges hereunder, or under any Other Security Document, of and security
interests created hereunder, or under any Other Security Document, in the
Collateral of such Subsidiary shall be automatically released, upon the
consummation of any transaction permitted by this Agreement and the Credit
Agreement as a result of which such Subsidiary ceases to be a Subsidiary;
provided that any consent to such transaction required by the Credit Agreement
shall have been obtained and the terms of such consent shall not provide
otherwise.

(c)  Upon any sale or other transfer of any Collateral permitted under this
Agreement and the Credit Agreement by any Grantor to any Person other than the
Company or a Subsidiary, or upon the effectiveness of any written consent to the
release of any pledge or security interest created hereby or by any Other
Security Document in respect of any Collateral pursuant to and in accordance
with the requirements of the Credit Agreement, all pledges, security interests
and Liens created hereunder or under any Other Security Document of, in or on
such Collateral shall be automatically released.

(d)  Upon any transfer of any Equity Interests in a Foreign Subsidiary pursuant
to and in accordance with Section 6.04(c) of the Credit Agreement, the
Collateral Agent shall release any pledge of, security interest in or Lien on
such Equity Interests if the conditions to such release set forth in such
Section 6.04(c) shall have been satisfied and if the Company shall have
delivered a certificate to that effect to the Collateral Agent.

(e)  In connection with any termination or release pursuant to paragraph (a),
(b), (c) or (d) above, the Collateral Agent shall execute and deliver to each
applicable Grantor, at such Grantor’s expense, all documents that such Grantor
shall reasonably request to evidence such termination or release.  Any execution
and delivery of documents pursuant to this Section shall be without recourse to
or representation or warranty by the Collateral Agent.  Notwithstanding
paragraph (b) or (c) above, in the case of any Lien on any Equity Interests in
an entity organized under the laws of a jurisdiction outside the United States
of America, such Lien shall not be released until the Collateral Agent executes
and delivers to the applicable Grantor a written consent to such release.  The
Collateral Agent agrees to execute and deliver any such written consent required
by the immediately preceding sentence that is requested by the applicable
Grantor in connection with the consummation of any transaction permitted by this
Agreement and the Credit Agreement.  In the case of any License of Intellectual
Property to any Person that is not an Affiliate of any Grantor (i) for which it
receives consideration at the time of such License at least equal to the Fair
Market Value of the subject Intellectual Property and in respect of which the
Borrower shall have delivered a notice to the Administrative Agent designating
such transfer as an Asset Disposition for purposes of Section 6.04 of the Credit
Agreement, (ii) that constitutes an Asset Disposition under Section 6.04 of the
Credit Agreement, or (iii) that does not materially reduce the collateral value
to the Secured Parties of the Material Intellectual Property, taken as a whole,
and, in each case, is permitted under this Agreement and the Credit Agreement,
the Liens on such Intellectual Property granted hereunder shall be subject to
the rights of third parties to use such Intellectual Property under such
License; provided that no such License shall be used for the purpose of securing
or otherwise providing credit support for Indebtedness.

 

[[5336199v.2]]

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40

SECTION 12.14.  Additional Grantors and Guarantors.  (a)  Upon execution and
delivery by the Collateral Agent and a Subsidiary of an instrument in a form
agreed to by the Collateral Agent and the Company (an “Additional Subsidiary
Agreement”), such Subsidiary shall become a party hereto and a Grantor and a
Guarantor hereunder to the extent set forth in such Additional Subsidiary
Agreement and shall, to the extent applicable, guarantee and create pledges of
and security interests in its assets to secure the Obligations with the same
force and effect as if originally named as a Grantor or Guarantor herein.  At
the time any Subsidiary shall become a party to this Agreement as provided in
the preceding sentence, the Schedules hereto shall be supplemented as
appropriate to reflect the guarantees, pledges and security interests, as
applicable, given or created by such Subsidiary, and such supplemented Schedules
shall replace the Schedules that shall theretofore have been attached to this
Agreement.  The execution and delivery of any Additional Subsidiary Agreement
and the amendment of the Schedules hereto as above provided shall not require
the consent of any other Credit Party.  The rights and obligations of each
Credit Party shall remain in full force and effect notwithstanding the addition
of any new Credit Party as a party to this Agreement.

(b)  Any Subsidiary that is a Guarantor may elect to become a Grantor at any
time by delivering a certificate in substantially the form agreed to by the
Collateral Agent and the Company or in such other form as may be reasonably
required by the Collateral Agent.  Any such election shall be effective
immediately upon the delivery of such certificate.  At the time any such
election is made, the Schedules hereto shall be supplemented as appropriate to
reflect the pledges and security interests given or created by such Subsidiary,
and such supplemented Schedules shall replace the Schedules that shall
theretofore have been attached to this Agreement.  The execution and delivery of
any certificate hereunder and the amendment of the Schedules hereto as above
provided shall not require the consent of the Collateral Agent or any Credit
Party.  The rights and obligations of each Credit Party shall remain in full
force and effect notwithstanding the addition of any new Grantor as a party to
this Agreement.

SECTION 12.15.  Collateral Agent Appointed Attorney-in-Fact.  Each Grantor
hereby appoints the Collateral Agent the attorney-in-fact of such Grantor for
the purpose of carrying out the provisions of this Agreement and taking any
action and executing any instrument that the Collateral Agent may deem necessary
or advisable to accomplish the purposes hereof in each case upon the occurrence
and during the continuance of an Event of Default, which appointment is
irrevocable and coupled with an interest.  Without limiting the generality of
the foregoing, the Collateral Agent shall have the right, upon the occurrence
and during the continuance of an Event of Default, with full power of
substitution either in the Collateral Agent’s name or in the name of such
Grantor (a) to receive, endorse, assign and/or deliver any and all notes,
acceptances, checks, drafts, money orders or other evidences of payment relating
to the Collateral of such Grantor or any part thereof; (b) to demand, collect,
receive payment of, give receipt for and give discharges and releases of all or
any of the Collateral; (c) to sign the name of any Grantor on any invoice or
bill of lading relating to any of the Collateral; (d) to send verifications of
Accounts Receivable to any Account Debtor; (e) to commence and prosecute any and
all suits, actions or proceedings at law or in equity in any court of competent
jurisdiction to collect or otherwise realize on all or any of the Collateral or
to

 

[[5336199v.2]]

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41

enforce any rights in respect of any Collateral; (f) to settle, compromise,
compound, adjust or defend any actions, suits or proceedings relating to all or
any of the Collateral; (g) to notify, or to require any Grantor to notify,
Account Debtors to make payment directly to the Collateral Agent relating to the
Collateral; and (h) to use, sell, assign, transfer, pledge, make any agreement
with respect to or otherwise deal with all or any of the Collateral, and to do
all other acts and things necessary to carry out the purposes of this Agreement,
as fully and completely as though the Collateral Agent were the absolute owner
of the Collateral for all purposes; provided that nothing herein contained shall
be construed as requiring or obligating the Collateral Agent to make any
commitment or to make any inquiry as to the nature or sufficiency of any payment
received by the Collateral Agent, or to present or file any claim or notice, or
to take any action with respect to the Collateral or any part thereof or the
moneys due or to become due in respect thereof or any property covered
thereby.  The Collateral Agent and the other Secured Parties shall be
accountable only for amounts actually received as a result of the exercise of
the powers granted to them herein, and neither they nor their officers,
directors, employees or agents shall be responsible to any Grantor for any act
or failure to act hereunder, except for their own gross negligence or wilful
misconduct or the breach of such Person of its obligations set forth herein.

SECTION 12.16.  Excluded Swap Obligations.  The provisions of Section 1.06 of
the Credit Agreement are incorporated by reference herein, mutatis mutandis.

[Signature pages follow]

 

 

[[5336199v.2]]

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THE GOODYEAR TIRE & RUBBER COMPANY, as Borrower

by

 

/s/ Peter R. Rapin

 

Name: Peter R. Rapin

 

Title:  Vice President, Tax & Treasurer

 

 

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

by

 

/s/ Robert P. Kellas

 

Name: Robert P. Kellas

 

Title:  Executive Director

 

 

 

celeron corporation, as a guarantor,

by

 

/s/ Peter R. Rapin

 

Name: Peter R. Rapin

 

Title:  Vice President and Treasurer

 

 

 

divested companies holding company, as a guarantor and a grantor,

by

 

/s/ Peter R. Rapin

 

Name: Peter R. Rapin

 

Title:  Vice President and Treasurer

 

 

by

 

 

/s/ Evan M. Scocos

 

Name: Evan M. Scocos

 

Title:  Vice President and Controller

 

 

[Signature Page to First Lien Guarantee and Collateral Agreement]

 

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

 

divested litchfield park properties, inc., as a guarantor and a grantor,

by

 

/s/ Peter R. Rapin

 

Name: Peter R. Rapin

 

Title:  Vice President and Treasurer

 

 

by

 

 

/s/ Evan M. Scocos

 

Name: Evan M. Scocos

 

Title:  Vice President and Controller

 

 

goodyear farms, inc., as a guarantor and a grantor,

by

 

/s/ Peter R. Rapin

 

Name: Peter R. Rapin

 

Title:  Vice President and Treasurer

 

 

goodyear international corporation, as a guarantor and a grantor,

by

 

/s/ Peter R. Rapin

 

Name: Peter R. Rapin

 

Title:  Vice President and Treasurer

 

 

goodyear western hemisphere corporation, as a guarantor,

by

 

/s/ Peter R. Rapin

 

Name: Peter R. Rapin

 

Title:  Vice President and Treasurer

 

 

 

 

 

[Signature Page to First Lien Guarantee and Collateral Agreement]

 

 

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

 

 

 

t&WA, INC., as a guarantor,

by

 

/s/ Peter R. Rapin

 

Name: Peter R. Rapin

 

Title:  Treasurer

 

 

GOODYEAR EXPORT Inc., as a guarantor,

by

 

/s/ Peter R. Rapin

 

Name: Peter R. Rapin

 

Title:  Vice President and Treasurer

 

RABEN TIRE CO., LLC, as a guarantor and a grantor,

by THE GOODYEAR TIRE & RUBBER COMPANY, its sole member

 

by

 

 

/s/ Peter R. Rapin

 

Name: Peter R. Rapin

 

Title:  Vice President, Tax & Treasurer

 

goodyear canada inc., as a guarantor and a grantor,

by

 

/s/ Paul Christou

 

Name: Paul Christou

 

Title:  Comptroller

 

 

by

 

 

/s/ Frank D. Lamie

 

Name: Frank D. Lamie

 

Title:  Corporate Secretary

 

[Signature Page to First Lien Guarantee and Collateral Agreement]