Exhibit 10.2

 

EXECUTION COPY

 

 

GUARANTEE AND COLLATERAL AGREEMENT

 

made by

 

GNC CORPORATION

 

GENERAL NUTRITION CENTERS, INC.

 

and certain of its Subsidiaries

 

in favor of

 

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

 

Dated as of November 26, 2013

 

(amending and restating the Guarantee and Collateral Agreement

dated as of March 4, 2011, as amended)

 

 

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TABLE OF CONTENTS

 

 

 

 

Page

 

 

 

 

SECTION 1      DEFINED TERMS

 

2

 

 

 

 

1.1.

Definitions

 

2

1.2.

Other Definitional Provisions

 

6

 

 

 

 

SECTION 2      GUARANTEE

 

7

 

 

 

 

2.1.

Guarantee

 

7

2.2.

Rights of Reimbursement, Contribution and Subrogation

 

8

2.3.

Amendments, etc. with respect to the Borrower Obligations

 

8

2.4.

Guarantee Absolute and Unconditional

 

9

2.5.

Reinstatement

 

10

2.6.

Payments

 

10

 

 

 

 

SECTION 3      GRANT OF SECURITY INTEREST

 

10

 

 

 

 

SECTION 4      REPRESENTATIONS AND WARRANTIES

 

12

 

 

 

 

4.1.

[Reserved]

 

12

4.2.

Title; No Other Liens

 

12

4.3.

Perfected First Priority Liens

 

12

4.4.

Name; Jurisdiction of Organization, etc.

 

12

4.5.

[Reserved]

 

13

4.6.

Farm Products

 

13

4.7.

Investment Property

 

13

4.8.

[Reserved]

 

13

4.9.

[Reserved]

 

13

4.10.

Intellectual Property

 

13

4.11.

Commercial Tort Claims

 

14

 

 

 

 

SECTION 5      COVENANTS

 

14

 

 

 

 

5.1.

[Reserved]

 

14

5.2.

Delivery of Pledged Securities, Notes, Debt Securities and Certificated
Securities

 

14

5.3.

Maintenance of Insurance

 

15

5.4.

[Reserved]

 

15

5.5.

Maintenance of Perfected Security Interest; Further Documentation

 

15

 

ii

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5.6.

Changes in Locations, Name, Jurisdiction of Incorporation, etc.

 

16

5.7.

Notices

 

16

5.8.

Investment Property

 

16

5.9.

[Reserved]

 

17

5.10.

Intellectual Property

 

17

5.11.

Commercial Tort Claims

 

19

 

 

 

 

SECTION 6      REMEDIAL PROVISIONS

 

19

 

 

 

 

6.1.

Certain Matters Relating to Receivables

 

19

6.2.

Communications with Obligors; Grantors Remain Liable

 

20

6.3.

Pledged Securities

 

21

6.4.

Proceeds to be Turned Over To Administrative Agent

 

22

6.5.

Application of Proceeds

 

22

6.6.

Code and Other Remedies

 

23

6.7.

Registration Rights

 

25

6.8.

Waiver; Deficiency

 

26

 

 

 

 

SECTION 7      THE ADMINISTRATIVE AGENT

 

26

 

 

 

 

7.1.

Administrative Agent’s Appointment as Attorney-in-Fact, etc.

 

26

7.2.

Duty of Administrative Agent

 

28

7.3.

Financing Statements; Intellectual Property Filings

 

28

7.4.

Authority of Administrative Agent

 

29

 

 

 

 

SECTION 8      MISCELLANEOUS

 

29

 

 

 

 

8.1.

Amendments in Writing

 

29

8.2.

Notices

 

29

8.3.

No Waiver by Course of Conduct; Cumulative Remedies

 

29

8.4.

Enforcement Expenses; Indemnification

 

30

8.5.

Successors and Assigns

 

30

8.6.

Set-Off

 

30

8.7.

Counterparts

 

31

8.8.

Severability

 

31

8.9.

Section Headings

 

31

8.10.

Integration

 

31

8.11.

GOVERNING LAW

 

31

8.12.

Submission to Jurisdiction; Waivers

 

31

 

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8.13.

Acknowledgments

 

32

8.14.

Additional Grantors

 

32

8.15.

Releases

 

32

8.16.

WAIVER OF JURY TRIAL

 

33

8.17.

Amendment and Restatement

 

33

 

SCHEDULES

 

Schedule 1

Notice Addresses of Guarantors

Schedule 2

Description of Pledged Investment Property

Schedule 3

Filings and Other Actions Required to Perfect Security Interests

Schedule 4

Exact Legal Name, Location of Jurisdiction of Organization and Chief Executive
Office

Schedule 5

Copyrights, Patents, Trademarks, Intellectual Property Licenses and Other
Intellectual Property

 

 

EXHIBITS

 

 

 

Exhibit A

Acknowledgment and Consent

Exhibit B-1

Intellectual Property Security Agreement

Exhibit B-2

After-Acquired Intellectual Property Security Agreement

Exhibit C

Intercompany Subordinated Demand Promissory Note

 

 

Annex I

Assumption Agreement

 

iv

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GUARANTEE AND COLLATERAL AGREEMENT

 

GUARANTEE AND COLLATERAL AGREEMENT, dated as of November 26, 2013 (amending and
restating the Guarantee and Collateral Agreement dated as of March 4, 2011, as
amended), made by each of the signatories hereto (together with any other entity
that may become a party hereto as provided herein, the “Grantors”), in favor of
JPMORGAN CHASE BANK, N.A., as Administrative Agent (together with its successor
in such capacity, the “Administrative Agent”) for (i) the Lenders (as defined
below) from time to time parties to the Credit Agreement, dated as of
November 26, 2013 (as amended, restated, amended and restated, supplemented, or
otherwise modified or replaced from time to time, the “Credit Agreement”), among
GNC CORPORATION, a Delaware corporation (“Parent”), GENERAL NUTRITION
CENTERS, INC., a Delaware corporation (the “Borrower”), the several banks and
other financial institutions or entities from time to time parties thereto as
lenders (the “Lenders”), GOLDMAN SACHS BANK USA, as syndication agent (in such
capacity, the “Syndication Agent”), DEUTSCHE BANK SECURITIES INC. and MORGAN
STANLEY SENIOR FUNDING, INC., as co-documentation agents (in such capacity, the
“Co-Documentation Agents”) and the Administrative Agent, and (ii) the other
Secured Parties (as hereinafter defined).

 

W I T N E S S E T H:

 

WHEREAS, pursuant to the Credit Agreement, dated as of March 4, 2011, among the
Parent, the Borrower, the lenders and agents party thereto and JPMorgan Chase
Bank, N.A., as administrative agent (as amended, supplemented or otherwise
modified prior to the date hereof, the “Existing Credit Agreement”), the lenders
thereunder have made extensions of credit to the Borrower;

 

WHEREAS, the Existing Credit Agreement has been amended and restated pursuant to
the Credit Agreement, and all obligations, liabilities, indebtedness and liens
created by the Existing Credit Agreement are continued unimpaired and in full
force and effect pursuant to the Credit Agreement;

 

WHEREAS, pursuant to the Credit Agreement, the Lenders have severally made and
agreed to make extensions of credit to the Borrower upon the terms and subject
to the conditions set forth therein;

 

WHEREAS, the Borrower is a member of an affiliated group of companies that
includes each other Grantor;

 

WHEREAS, the proceeds of the extensions of credit under the Credit Agreement
have been and will be used in part to enable the Borrower to make valuable
transfers to one or more of the other Grantors in connection with the operation
of their respective businesses;

 

WHEREAS, Qualified Counterparties have and may from time to time enter into
Specified Hedge Agreements with and provide Cash Management Services to the
Borrower;

 

WHEREAS, the Borrower and the other Grantors are engaged in related businesses,
and each Grantor derives and will derive substantial direct and indirect benefit
from

 

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the making of the extensions of credit under the Credit Agreement and from such
Specified Hedge Agreements and Cash Management Services;

 

WHEREAS, the Grantors and the Administrative Agent are parties to the Guarantee
and Collateral Agreement, dated as of March 4, 2011 (as amended, supplemented or
otherwise modified prior to the date hereof, the “Existing Guarantee and
Collateral Agreement”);

 

WHEREAS, it is a condition precedent to the obligation of the Lenders to make
their respective extensions of credit to the Borrower under the Credit Agreement
that the Grantors shall have executed and delivered this Agreement to the
Administrative Agent for the ratable benefit of the Secured Parties; and

 

WHEREAS, for convenience the parties hereto desire to amend and restate the
Existing Guarantee and Collateral Agreement pursuant to this Agreement rather
than amend the Existing Guarantee and Collateral Agreement;

 

NOW, THEREFORE, in consideration of the above premises the parties hereto hereby
agree as follows:

 

SECTION 1          DEFINED TERMS

 

1.1.         Definitions.  (a)  Unless otherwise defined herein, terms defined
in the Credit Agreement and used herein shall have the meanings given to them in
the Credit Agreement, and the following terms which are defined in Article 8 or
9 of the New York UCC are used herein as so defined:  Account Debtor, Accounts,
Commodity Account, Commodity Contract, Documents, Electronic Chattel Paper,
Equipment, Farm Products, Fixtures, Goods, Instruments, Inventory, Letter of
Credit Rights, Money, Payment Intangibles, Securities Account, Security,
Security Entitlement, Supporting Obligations, Tangible Chattel Paper and
Uncertificated Security.

 

(b)           The following terms shall have the following meanings:

 

“After-Acquired Intellectual Property Collateral”:  as defined in
Section 5.10(k).

 

“Agreement”:  the Existing Guarantee and Collateral Agreement, as amended and
restated by this Guarantee and Collateral Agreement, as the same may be further
amended, restated, amended and restated, supplemented, or otherwise modified
from time to time.

 

“Applicable Date”:  means with respect to any Grantor, (i) the date of this
Agreement if such Grantor is a party hereto on the Closing Date, (ii) the date
on which an Assumption Agreement is executed and delivered by such Grantor if
such Grantor is not a party hereto on the Closing Date, and (iii) the date on
which such Grantor is required to provide updates to the Schedules to this
Agreement with respect to such Grantor pursuant to Section 5.10 of the Credit
Agreement.

 

“Borrower Obligations”:  the Obligations (as defined in the Credit Agreement).

 

2

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“Collateral”:  as defined in Section 3.

 

“Collateral Account”:  any collateral deposit account established by the
Administrative Agent to hold cash pending application to the Obligations.

 

“Copyright Licenses”:  any written agreement naming any Grantor as licensor or
licensee, providing for the granting by or to any Grantor of any right in or to
any Copyright, including, without limitation, those listed in Schedule 5.

 

“Copyrights”:  (i) all United States and foreign copyrights, whether or not the
underlying works of authorship have been published, including but not limited to
copyrights in software and databases, all Mask Works (as defined in 17 U.S.C.
901 of the U.S. Copyright Act) and all works of authorship and other
intellectual property rights therein, all right, title and interest to make and
exploit all derivative works based on or adopted from works covered by such
copyrights, and all copyright registrations, copyright applications, mask works
registrations and mask works applications, and any renewals or extensions
thereof, including, without limitation, each registration and application
identified in Schedule 5, and (ii) the rights to print, publish and distribute
any of the foregoing.

 

“Deposit Account”:  all “deposit accounts” as defined in Article 9 of the New
York UCC, including, without limitation, all demand, time, savings, passbook and
like accounts maintained with any financial institution (other than Securities
Accounts or Commodity Accounts) and all of the accounts listed on Schedule 2
hereto under the heading “Deposit Accounts” (as such schedule may be amended
from time to time) and all Collateral Accounts.

 

“Discharge of Obligations”:  as defined in Section 2.1(d).

 

“Excluded Capital Stock”:  Capital Stock (i) in any Subsidiary that is not a
Wholly-Owned Subsidiary to the extent the pledge or other granting of a security
interest under the Loan Documents in such Capital Stock would be prohibited by,
or require a consent or approval under, organizational or governance documents
or shareholders’ or similar agreements of or with respect to such Subsidiary and
(ii) Excluded Foreign Subsidiary Voting Stock in excess of 65% of the voting
Capital Stock in such Subsidiary.

 

“Excluded Foreign Subsidiary Voting Stock”:  the voting Capital Stock of any
Foreign Subsidiary or any Domestic Subsidiary all (other than an immaterial
portion) of whose assets consist of Capital Stock of one or more CFCs.

 

“General Intangibles”:  all “general intangibles” as such term is defined in
Section 9-102(a)(42) of the New York UCC, and, in any event, including, without
limitation, with respect to any Grantor, all rights of such Grantor to receive
any tax refunds, all Hedge Agreements and all contracts, agreements, instruments
and indentures and all licenses, permits, concessions, franchises and
authorizations issued by Governmental Authorities in any form, and portions
thereof, to which such Grantor is a party or under which such Grantor has any
right, title or interest or to which such Grantor or any property of such
Grantor is subject, as the same may from time to time be amended, supplemented,

 

3

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replaced or otherwise modified, including, without limitation, (i) all rights of
such Grantor to receive moneys due and to become due to it thereunder or in
connection therewith, (ii) all rights of such Grantor to receive proceeds of any
insurance, indemnity, warranty or guaranty with respect thereto, (iii) all
rights of such Grantor to damages arising thereunder, and (iv) all rights of
such Grantor to terminate and to perform, compel performance and to exercise all
remedies thereunder.

 

“Governmental Authority”:  a federal, state, local or foreign court or
governmental agency, authority, instrumentality or regulatory body.

 

“Guarantor Obligations”:  with respect to any Guarantor, all obligations and
liabilities of such Guarantor which may arise under or in connection with this
Agreement (including, without limitation, Section 2) or any other Loan Document
to which such Guarantor is a party, in each case whether on account of guarantee
obligations, reimbursement obligations, fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and disbursements of counsel
to any Secured Party that are required to be paid by such Guarantor pursuant to
the terms of this Agreement or any other Loan Document).

 

“Guarantors”:  the collective reference to each Grantor other than the Borrower.

 

“Infringement”: infringement, misappropriation, dilution or other impairment or
violation.

 

“Intellectual Property”:  the collective reference to all rights relating to
intellectual property, whether arising under United States federal or state
laws, multinational or foreign laws or otherwise, including, without limitation,
the Copyrights, the Copyright Licenses, the Patents, the Patent Licenses, the
Trademarks, the Trademark Licenses, the Trade Secrets and the Trade Secret
Licenses.

 

“Intercompany Note”:  any promissory note evidencing loans made by any Grantor
to Parent or any of its Subsidiaries, including, without limitation, the
subordinated Intercompany Note in the form attached as Exhibit C (the
“Subordinated Intercompany Note”).

 

“Investment Property”:  the collective reference to (i) all “investment
property” as such term is defined in Section 9-102(a)(49) of the of New York
UCC, (ii) security entitlements, in the case of any United States Treasury
book-entry securities, as defined in 31 C.F.R. section 357.2, or, in the case of
any United States federal agency book-entry securities, as defined in the
corresponding United States federal regulations governing such book-entry
securities, and (iii) whether or not constituting “investment property” as so
defined, all Pledged Securities, all Pledged Security Entitlements and all
Pledged Commodity Contracts, other than, in the case of each of the foregoing
clauses (i) — (iii), Excluded Capital Stock.

 

“Issuers”:  the collective reference to each issuer of a Pledged Security that
is pledged by a Grantor hereunder.

 

4

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

 

“Obligations”:  (i) in the case of the Borrower, the Borrower Obligations, and
(ii) in the case of each Guarantor, its Guarantor Obligations.

 

“Patent License”:  all written agreements naming any Grantor as licensor or
licensee, providing for the granting by or to any Grantor of any right in or to
a Patent, including, without limitation, any of the foregoing referred to in
Schedule 5.

 

“Patents”:  (i) all United States and foreign patents, patent applications and
patentable inventions, including, without limitation, each issued patent and
patent application identified in Schedule 5, and all certificates of invention
or similar property rights, (ii) all inventions and improvements described and
claimed therein, and (iii) all reissues, divisions, reexaminations,
continuations, continuations-in-part, substitutes, renewals, and extensions
thereof and all improvements thereon.

 

“Pledged Capital Stock”:  all shares or other equity interests constituting
Capital Stock now owned or hereafter acquired by such Grantor, including,
without limitation, all shares of Capital Stock described on Schedule 2 hereto
(as such schedule may be amended from time to time), and the certificates, if
any, representing such Capital Stock and any interest of such Grantor in the
entries on the books of the issuer of such Capital Stock and all dividends,
distributions, cash, warrants, rights, options, instruments, securities and
other property or proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of such Capital Stock
and any other warrant, right or option to acquire any of the foregoing, other
than Excluded Capital Stock.

 

“Pledged Debt Securities”:  all debt securities now owned or hereafter acquired
by any Grantor, including, without limitation, the debt securities listed on
Schedule 2, (as such Schedule may be amended from time to time).

 

“Pledged Notes”:  all promissory notes now owned or hereafter acquired by any
Grantor including, without limitation, those listed on Schedule 2 (as such
Schedule may be amended from time to time) and all Intercompany Notes at any
time issued to any Grantor.

 

“Pledged Securities”:  the collective reference to the Pledged Debt Securities,
the Pledged Notes and the Pledged Capital Stock.

 

“Proceeds”:  all “proceeds” as such term is defined in Section 9-102(a)(64) of
the New York UCC and, in any event, shall include, without limitation, all
dividends or other income from the Pledged Securities, collections thereon or
distributions or payments with respect thereto.

 

“Receivable”:  all Accounts and any other right to payment for goods or other
property sold, leased, licensed or otherwise disposed of or for services
rendered, whether

 

5

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or not such right is evidenced by an Instrument or Chattel Paper or classified
as a Payment Intangible and whether or not it has been earned by performance.

 

“Secured Parties”:  collectively, the Administrative Agent, the Syndication
Agent, the Co-Documentation Agents, the Lenders, the Indemnitees (as defined in
the Credit Agreement) and, with respect to any Specified Hedge Agreement or Cash
Management Obligations, any Qualified Counterparty that has agreed to be bound
by the provisions of Section 7.2 hereof as if it were a party hereto and by the
provisions of Section 8 of the Credit Agreement as if it were a Lender party
thereto; provided that no Qualified Counterparty shall have any rights in
connection with the management or release of any Collateral or the obligations
of any Grantor under this Agreement.

 

“Securities Act”:  the Securities Act of 1933, as amended.

 

“Trademark License”:  any written agreement naming any Grantor as licensor or
licensee. providing for the granting by or to any Grantor of any right in or to
any Trademark, including, without limitation, any of the foregoing referred to
in Schedule 5.

 

“Trademarks”:  (i) all United States, state and foreign trademarks, service
marks, trade names, corporate names, company names, business names, trade dress,
trade styles, logos, or other indicia of origin or source
identification, Internet domain names, trademark and service mark registrations,
and applications for trademark or service mark registrations and any renewals
thereof, including, without limitation, each registration and application
identified in Schedule 5 and (ii) the goodwill of the business connected with
the use of, and symbolized by, each of the above.

 

“Trade Secret License”:  any written agreement naming any Grantor as licensor or
licensee, providing for the granting by or to any Grantor of any right in or to
any Trade Secret, including, without limitation, any of the foregoing referred
to in Schedule 5.

 

“Trade Secrets”:  all trade secrets and all confidential and proprietary
information, including know-how, manufacturing and production processes and
techniques, inventions, research and development information, technical data,
financial, marketing and business data, pricing and cost information, business
and marketing plans, and customer and supplier lists and information, formulae,
parts, diagrams, drawings, specifications, blue prints, lists of materials, and
production manuals.

 

“Vehicles”:  all cars, trucks, trailers, construction and earth moving equipment
and other Equipment of any nature covered by a certificate of title law of any
jurisdiction and all tires and other appurtenances to any of the foregoing.

 

1.2.         Other Definitional Provisions.  (a)    The words “hereof”,
“herein”, “hereto” and “hereunder” and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement, and Section and Schedule references are to this
Agreement unless otherwise specified.

 

(b)           The meanings given to terms defined herein shall be equally
applicable to both the singular and plural forms of such terms.

 

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(c)           Where the context requires, terms relating to the Collateral or
any part thereof, when used in relation to a Grantor, shall refer to such
Grantor’s Collateral or the relevant part thereof.

 

(d)           The expressions “payment in full,” “paid in full” and any other
similar terms or phrases when used herein with respect to the Obligations or the
Borrower Obligations shall mean the payment in full, in immediately available
funds, of all of the Borrower Obligations (excluding Borrower Obligations in
respect of any Specified Hedge Agreements, Cash Management Obligations and
contingent reimbursement and indemnification obligations, in each case, that are
not then due and payable) and the expiration or termination of all undrawn
Letters of Credit (or cash collateralization (in a manner consistent with
Section 2.8(j) of the Credit Agreement) or provision of backstop letters of
credit (in a manner reasonably satisfactory to the relevant Issuing Bank) with
respect thereto).

 

SECTION 2          GUARANTEE

 

2.1.         Guarantee.  (a)     Each of the Guarantors hereby, jointly and
severally, unconditionally and irrevocably, guarantees to the Administrative
Agent, for the benefit of the Secured Parties and their respective successors,
indorsees, transferees and assigns, the prompt and complete payment and
performance by the Borrower when due (whether at the stated maturity, by
acceleration or otherwise) of the Borrower Obligations.

 

(b)           Anything herein or in any other Loan Document to the contrary
notwithstanding, the maximum liability of each Guarantor hereunder and under the
other Loan Documents shall in no event exceed the amount which can be guaranteed
by such Guarantor under applicable federal and state laws relating to the
insolvency of debtors (after giving effect to the right of contribution
established in Section 2.2).

 

(c)           Each Guarantor agrees that Borrower Obligations may at any time
and from time to time be incurred or permitted in an amount exceeding the
maximum liability of such Guarantor hereunder without impairing the guarantee
contained in this Section 2 or affecting the rights and remedies of any Secured
Party hereunder.

 

(d)           The guarantee contained in this Section 2 shall remain in full
force and effect until payment in full of the Borrower Obligations and
termination or expiration of the Commitments (the “Discharge of Obligations”),
notwithstanding that from time to time during the term of the Credit Agreement
the Borrower may be free from any Borrower Obligations.

 

(e)           No payment made by the Borrower, any of the Guarantors, any other
guarantor or any other Person or received or collected by any Secured Party from
the Borrower, any of the Guarantors, any other guarantor or any other Person by
virtue of any action or proceeding or any set-off or appropriation or
application at any time or from time to time in reduction of or in payment of
the Borrower Obligations shall be deemed to modify, reduce, release or otherwise
affect the liability of any Guarantor hereunder which shall, notwithstanding any
such payment (other than any payment made by such Guarantor in respect of the
Borrower Obligations or any payment received or collected from such Guarantor in
respect of the

 

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Borrower Obligations), remain liable for the Borrower Obligations up to the
maximum liability of such Guarantor hereunder until the Discharge of
Obligations.

 

2.2.         Rights of Reimbursement, Contribution and Subrogation.  (a)  Each
Subsidiary Guarantor hereby agrees that to the extent that a Subsidiary
Guarantor shall have paid more than its proportionate share of any payment made
hereunder, such Subsidiary Guarantor shall be entitled to seek and receive
contribution from and against any other Subsidiary Guarantor hereunder which has
not paid its proportionate share of such payment.  Each Subsidiary Guarantor’s
right of contribution shall be subject to the terms and conditions of
Section 2.2(b).  The provisions of this Section 2.2 shall in no respect limit
the obligation and liabilities of any Subsidiary Guarantor to the Administrative
Agent and the Lenders and each Subsidiary Guarantor shall remain liable to the
Secured Parties for the full amount guaranteed by such Subsidiary Guarantor
hereunder.

 

(b)           Notwithstanding any payment made by any Guarantor hereunder or any
set-off or application of funds of any Guarantor by the Administrative Agent or
any Secured Party, no Guarantor shall be entitled to be subrogated to any of the
rights of the Administrative Agent or any Secured Party against the Borrower or
any other Guarantor or any collateral security or guarantee or right of offset
held by the Administrative Agent or any Secured Party for the payment of the
Borrower Obligations, nor shall any Guarantor seek or be entitled to seek any
contribution or reimbursement from the Borrower or any other Guarantor in
respect of payments made by such Guarantor hereunder, until the Discharge of
Obligations.  If any amount shall be paid to any Guarantor on account of such
subrogation rights at any time prior to the Discharge of Obligations, such
amount shall be held by such Guarantor in trust for the Administrative Agent and
the Secured Parties, segregated from other funds of such Guarantor, and shall,
forthwith upon receipt by such Guarantor, be turned over to the Administrative
Agent in the exact form received by such Guarantor (duly indorsed by such
Guarantor to the Administrative Agent, if required), to be applied against the
Borrower Obligations, whether matured or unmatured, accordance with Section 6.5
hereof.

 

(c)           The obligations of the Grantors under the Loan Documents,
including their liability for the Obligations and the enforceability of the
security interests granted thereby, are not contingent upon the validity,
legality, enforceability, collectability or sufficiency of any right of
reimbursement, contribution or subrogation arising under this Section 2.2.  The
invalidity, insufficiency, unenforceability or uncollectibility of any such
right shall not in any respect diminish, affect or impair any such obligation or
any other claim, interest, right or remedy at any time held by any Secured Party
against any Guarantor or its property.  The Secured Parties make no
representations or warranties in respect of any such right and shall have no
duty to assure, protect, enforce or ensure any such right.

 

(d)           Each Grantor reserves any and all other rights of reimbursement,
contribution or subrogation at any time available to it as against any other
Grantor, but the exercise and enforcement of such rights shall be subject to
Section 2.2(b).

 

2.3.         Amendments, etc. with respect to the Borrower Obligations.  Each
Guarantor shall remain obligated hereunder notwithstanding that, without any
reservation of rights against any Guarantor and without notice to or further
assent by any Guarantor, any

 

8

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demand for payment of any of the Borrower Obligations made by any Secured Party
may be rescinded by such Secured Party and any of the Borrower Obligations
continued, and the Borrower Obligations, or the liability of any other Person
upon or for any part thereof, or any collateral security or guarantee therefor
or right of offset with respect thereto, may, from time to time, in whole or in
part, be renewed, increased, extended, amended, modified, accelerated,
compromised, waived, surrendered or released by any Secured Party, and the
Credit Agreement and the other Loan Documents and any other documents executed
and delivered in connection therewith may be amended, modified, supplemented or
terminated, in whole or in part, as the Administrative Agent (or the requisite
Lenders under the Credit Agreement or all Lenders, as the case may be) may deem
advisable from time to time, and any collateral security, guarantee or right of
offset at any time held by any Secured Party for the payment of the Borrower
Obligations may be sold, exchanged, waived, surrendered or released.  No Secured
Party shall have any obligation to protect, secure, perfect or insure any Lien
at any time held by it as security for the Borrower Obligations or for the
guarantee contained in this Section 2 or any property subject thereto.

 

2.4.         Guarantee Absolute and Unconditional.  Each Guarantor waives any
and all notice of the creation, renewal, extension or accrual of any of the
Borrower Obligations and notice of or proof of reliance by any Secured Party
upon the guarantee contained in this Section 2 or acceptance of the guarantee
contained in this Section 2; the Borrower Obligations, and any of them, shall
conclusively be deemed to have been created, contracted or incurred, or renewed,
extended, amended or waived, in reliance upon the guarantee contained in this
Section 2; and all dealings between the Borrower and any of the Guarantors, on
the one hand, and the Secured Parties, on the other hand, likewise shall be
conclusively presumed to have been had or consummated in reliance upon the
guarantee contained in this Section 2.  Each Guarantor waives diligence,
presentment, protest, demand for payment and notice of default or nonpayment to
or upon the Borrower or any of the Guarantors with respect to the Borrower
Obligations.  Each Guarantor understands and agrees that the guarantee contained
in this Section 2 shall be construed as a continuing, absolute and unconditional
guarantee of payment and performance without regard to (a) the validity or
enforceability of the Credit Agreement or any other Loan Document, any of the
Borrower Obligations or any other collateral security therefor or guarantee or
right of offset with respect thereto at any time or from time to time held by
any Secured Party, (b) any defense, set-off or counterclaim (other than a
defense of payment or performance or the Discharge of Obligations) which may at
any time be available to or be asserted by the Borrower or any other Person
against any Secured Party, or (c) any other circumstance whatsoever (with or
without notice to or knowledge of the Borrower or such Guarantor) which
constitutes, or might be construed to constitute, an equitable or legal
discharge of the Borrower for the Borrower Obligations, or of such Guarantor
under the guarantee contained in this Section 2, in bankruptcy or in any other
instance other than the express written release of such Guarantor from this
Agreement by the Administrative Agent pursuant to and to the extent set forth in
Section 9.14 of the Credit Agreement.  To the fullest extent permitted by
applicable law, when making any demand hereunder or otherwise pursuing its
rights and remedies hereunder against any Guarantor, any Secured Party may, but
shall be under no obligation to, make a similar demand on or otherwise pursue
such rights and remedies as it may have against the Borrower, any other
Guarantor or any other Person or against any collateral security or guarantee
for the Borrower Obligations or any right of offset with respect thereto, and
any failure by any Secured Party to make any such demand, to pursue such other
rights or remedies or to collect any payments from

 

9

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the Borrower, any other Guarantor or any other Person or to realize upon any
such collateral security or guarantee or to exercise any such right of offset,
or any release of the Borrower or any other Guarantor or any such collateral
security, guarantee or right of offset, shall not relieve any Guarantor of any
obligation or liability hereunder, and shall not impair or affect the rights and
remedies, whether express, implied or available as a matter of law, of any
Secured Party against any Guarantor.  For the purposes hereof “demand” shall
include the commencement and continuance of any legal proceedings.

 

2.5.         Reinstatement.  The guarantee contained in this Section 2 shall
continue to be effective, or be reinstated, as the case may be, if at any time
payment, or any part thereof, of any of the Borrower Obligations is rescinded or
must otherwise be restored or returned by any Secured Party upon the insolvency,
bankruptcy, dissolution, liquidation or reorganization of the Borrower or any
Guarantor, or upon or as a result of the appointment of a receiver, intervenor
or conservator of, or trustee or similar officer for, the Borrower or any
Guarantor or any substantial part of its property, or otherwise, all as though
such payments had not been made.

 

2.6.         Payments.  Each Guarantor hereby guarantees that payments hereunder
will be paid to the Administrative Agent without set-off or counterclaim in
Dollars in immediately available funds at the office of the Administrative Agent
in New York, NY.

 

SECTION 3          GRANT OF SECURITY INTEREST

 

(a)           Each Grantor hereby assigns and transfers to the Administrative
Agent, and hereby grants to the Administrative Agent, for the ratable benefit of
the Secured Parties, a security interest in, all of such Grantor’s right, title
and interest in and to all of the following personal property, in each case,
wherever located and whether 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 (collectively, the “Collateral”), as
collateral security for the prompt and complete payment and performance when due
(whether at the stated maturity, by acceleration or otherwise) of such Grantor’s
Obligations:

 

(i)                    all Accounts;

 

(ii)                   all Chattel Paper;

 

(iii)                  all Deposit Accounts;

 

(iv)                  all Documents;

 

(v)                   all Equipment;

 

(vi)                  all General Intangibles;

 

(vii)                 all Instruments;

 

(viii)                all Intellectual Property, and (A) the right to sue or
otherwise recover for any and all past, present and future Infringements and

 

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misappropriations thereof, and (B) all income, royalties, damages and other
payments now and hereafter due and/or payable with respect thereto;

 

(ix)                  all Inventory;

 

(x)                   all Investment Property;

 

(xi)                  all Letter of Credit Rights;

 

(xii)                 all Money;

 

(xiii)                all Vehicles;

 

(xiv)                all Goods not otherwise described above;

 

(xv)                 any Collateral Account;

 

(xvi)                all books, records, ledger cards, files, correspondence,
customer lists, blueprints, technical specifications, manuals, computer
software, computer printouts, tapes, disks and other electronic storage media
and related data processing software and similar items that at any time evidence
or contain information relating to any of the Collateral or are otherwise
necessary or helpful in the collection thereof or realization thereupon; and

 

(xvii)               to the extent not otherwise included, all other personal
property of the Grantor and all Proceeds, products, accessions, rents and
profits of any and all of the foregoing and all collateral security, Supporting
Obligations and guarantees given by any Person with respect to any of the
foregoing.

 

Notwithstanding anything to the contrary in this Agreement, this Agreement shall
not constitute a grant of a security interest in any Excluded Assets and none of
the Excluded Assets shall constitute Collateral.

 

(b)           Notwithstanding anything to the contrary in the Loan Documents,
none of the Grantors shall be required (i) to perfect the security interests
granted by this Agreement by any means other than by (A) filings pursuant to the
Uniform Commercial Code in the office of the secretary of state (or equivalent
filing office) of the relevant State(s), (B) filings in United States government
offices with respect to Intellectual Property and (C) delivery to the
Administrative Agent to be held in its possession of all Collateral consisting
of Instruments, notes and debt securities and certificated Capital Stock to the
extent required by Section 5.2, (ii) to enter into any deposit account control
agreement, securities account control agreement, commodity account control
agreement or any other control agreement with respect to any deposit account,
securities account, commodity account or any other collateral that requires
perfection by “control”, (iii) to take any action (other than the actions listed
in clause (i)(A) and (C) above) with respect to any assets located outside of
the United States or (iv) to perfect in any letter-of-credit rights or any motor
vehicles or other assets subject to a certificate of title (except filings
listed in clause (i)(A) above) (to the extent such perfection can be achieved
through such filings).

 

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(c)           Notwithstanding anything herein to the contrary, (i) each Grantor
shall remain liable for all of its obligations under the Collateral and nothing
contained herein is intended or shall be a delegation of duties to any Secured
Party, (ii) each Grantor shall remain liable under and each of its agreements
included in the Collateral, to perform all of its obligations undertaken by it
thereunder all in accordance with and pursuant to the terms and provisions
thereof and neither the Administrative Agent nor any Secured Party shall have
any obligation or liability under any of such agreements by reason of or arising
out of this Agreement or any other document related thereto nor shall the
Administrative Agent nor any Secured Party have any obligation to make any
inquiry as to the nature or sufficiency of any payment received by it or have
any obligation to take any action to collect or enforce any rights under any
agreement included in the Collateral and (iii) the exercise by the
Administrative Agent of any of its rights hereunder shall not release any
Grantor from any of its duties or obligations under the contracts and agreements
included in the Collateral.

 

SECTION 4          REPRESENTATIONS AND WARRANTIES

 

To induce the Administrative Agent, the Syndication Agent and the Lenders to
enter into the Credit Agreement and to induce the Lenders to make their
respective extensions of credit to the Borrower thereunder, each Grantor hereby
represents and warrants to the Secured Parties that:

 

4.1.         [Reserved].

 

4.2.         Title; No Other Liens.  Such Grantor owns each item of the
Collateral free and clear of any and all Liens except for Permitted Liens.  No
financing statement, fixture filing or other public notice with respect to all
or any part of the Collateral is on file or of record in any public office,
except such as have been filed in favor of the Administrative Agent, for the
ratable benefit of the Secured Parties, pursuant to this Agreement or as are not
prohibited by the Credit Agreement.

 

4.3.         Perfected First Priority Liens.  The security interests granted
pursuant to this Agreement constitute valid security interests in all of the
Collateral in favor of the Administrative Agent, for the benefit of the Secured
Parties, as collateral security for such Grantor’s Obligations, enforceable
against each applicable Grantor in accordance with the terms hereof (subject to
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditor’s rights generally and by general
equitable principles (whether enforcement is sought in proceedings in equity or
at law)) and, other than with respect to Collateral a security interest in which
cannot be perfected by taking the actions specified in Section 3(b)(i) hereof,
upon completion of the filings and other actions specified on Schedule 3 (all of
which, in the case of all filings and other documents referred to on said
Schedule, have been delivered to the Administrative Agent in duly completed and
duly executed form, as applicable, and may be filed by the Administrative Agent
at any time after the effectiveness of the Credit Agreement) and payment of all
filing fees, will be perfected and are prior to all other Liens on the
Collateral except for Permitted Liens.

 

4.4.         Name; Jurisdiction of Organization, etc.  On the date hereof, such
Grantor’s exact legal name (as indicated on the public record of such Grantor’s
jurisdiction of

 

12

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formation or organization), jurisdiction of organization, organizational
identification number, if any, and the location of such Grantor’s chief
executive office or sole place of business are specified on Schedule 4.  Except
as specified on Schedule 4, no Person that is a Grantor on the date hereof has
changed its name, jurisdiction of organization, chief executive office or sole
place of business within the five year period immediately prior to the Closing
Date.

 

4.5.         [Reserved].

 

4.6.         Farm Products.  None of the Collateral constitutes, or is the
Proceeds of, Farm Products.

 

4.7.         Investment Property.  (a)  Schedule 2 hereto (as such schedule may
be amended from time to time) sets forth as of the most recent Applicable Date
with respect to such Grantor under the heading “Pledged Capital Stock” all of
the Pledged Capital Stock owned by any Grantor and such Pledged Capital Stock
constitutes the percentage of issued and outstanding shares of stock, percentage
of membership interests, percentage of partnership interests or percentage of
beneficial interest of the respective issuers thereof indicated on such
Schedule.  Schedule 2 hereto (as such schedule may be amended from time to time)
sets forth as of the most recent Applicable Date with respect to such Grantor
under the heading “Pledged Debt Securities” or “Pledged Notes” all of the
Pledged Debt Securities and Pledged Notes owned by any Grantor that are required
to be delivered to the Administrative Agent pursuant to Section 5.2(a) hereof.

 

(b)           The shares of Pledged Capital Stock pledged by such Grantor
hereunder constitute all of the issued and outstanding shares of all classes of
the Capital Stock of each Issuer of Capital Stock included in the Collateral
owned by such Grantor.

 

(c)           All the shares of the Pledged Capital Stock pledged by such
Grantor hereunder have been duly and validly issued and are fully paid and
nonassessable.

 

(d)           Such Grantor is the record and beneficial owner of, and has good
title to, the Investment Property pledged by it hereunder, free of any and all
Liens, except Permitted Liens.

 

4.8.         [Reserved].

 

4.9.         [Reserved].

 

4.10.       Intellectual Property.  (a)  Schedule 5 lists as of the most recent
Applicable Date (i) all issued Patents and pending Patent applications of any
Grantor with the United States Patent and Trademark Office, all registered
Copyrights and pending Copyright applications of any Grantor with the United
States Copyright Office, and all registered Trademarks and pending Trademark
applications of any Grantor with the United States Patent and Trademark Office,
(collectively, “Registered Intellectual Property”), and (ii) all registered
United States Intellectual Property (and applications therefor) exclusively
licensed by any Grantor and that is included in the Collateral, noting in each
case the relevant registration, application or serial number, and in the case of
(ii), the title of the license, the counterparty to such license and the date of
such license.

 

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(b)  Except as would not reasonably be expected to have a Material Adverse
Effect:

 

(i)            each Grantor owns or has the right to use all Intellectual
Property that is material to its business as currently conducted or as proposed
to be conducted, free of all Liens other than Permitted Liens, and takes
reasonable actions to protect, preserve and maintain such Intellectual Property;

 

(ii)           on the date hereof, all material Intellectual Property owned or
exclusively licensed by such Grantor, is valid, unexpired and unenforceable,
does not Infringe the intellectual property rights of any other Person, and to
such Grantor’s knowledge, is not being Infringed by any other Person; and all
material Registered Intellectual Property has not expired or been abandoned;

 

(iii)          as of the date hereof, no holding, decision or judgment has been
rendered by any Governmental Authority or arbitrator which would limit, cancel
or challenge the validity, enforceability, ownership or use of, such Grantor’s
rights in, any Intellectual Property in any respect, and such Grantor knows of
no valid basis for same; and

 

(iv)          no action or proceeding is pending, or, to the knowledge of such
Grantor, threatened, or imminent, in each case, on the date hereof seeking to
limit, cancel or challenge the validity, enforceability, ownership or use of any
Intellectual Property or such Grantor’s interest therein.

 

4.11.       Commercial Tort Claims.  As of the Closing Date, no Grantor has any
commercial tort claims individually or in the aggregate with a value in excess
of $5,000,000.

 

SECTION 5          COVENANTS

 

Each Grantor covenants and agrees with the Secured Parties that, until the
Discharge of Obligations:

 

5.1.         [Reserved].

 

5.2.         Delivery of Pledged Securities, Notes, Debt Securities and
Certificated Securities.  (a)  If any of the Collateral consists of an
Instrument, note or debt security with a principal amount of $5,000,000 or more,
such Instrument, note or debt security (other than (i) those that are promptly
deposited in an investment or securities account, (ii) checks received in the
ordinary course of business and (iii) notes and debt securities issued in
connection with the extension of trade credit by a Grantor in the ordinary
course of business) shall be promptly delivered to the Administrative Agent,
duly assigned or endorsed (including by the delivery of a note or similar power)
in a manner reasonably satisfactory to the Administrative Agent, to be held as
Collateral pursuant to this Agreement.

 

(b)           If any of the Collateral consisting of Capital Stock of a
Subsidiary of a Grantor is or shall become evidenced or represented by any
certificate, such certificate shall be promptly delivered to the Administrative
Agent, duly assigned or assigned or endorsed

 

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(including by the delivery of a stock or securities power) in a manner
reasonably satisfactory to the Administrative Agent, to be held as Collateral
pursuant to this Agreement.

 

(c)           [Reserved];

 

(d)           If any of the Collateral is or shall become evidenced or
represented by an Uncertificated Security, such Grantor shall cause the Issuer
thereof either (i) to register the Administrative Agent as the registered owner
of such Uncertificated Security, upon original issue or registration of transfer
or (ii) to agree in writing with such Grantor and the Administrative Agent that
such Issuer will comply with instructions with respect to such Uncertificated
Security originated by the Administrative Agent without further consent of such
Grantor, such agreement to be in form and substance reasonably satisfactory to
the Administrative Agent.

 

5.3.         Maintenance of Insurance.  (a)  Such Grantor will maintain, with
financially sound and reputable insurance (or self-insurance) companies,
insurance on all its property as and to the extent required by Section 5.5(b) of
the Credit Agreement; and furnish to the Administrative Agent, upon reasonable
written request by the Administrative Agent, information in reasonable scope and
detail as to the insurance carried.

 

(b)           Within 30 days following the later of the relevant Applicable Date
or the date of the relevant policy is obtained, the Administrative Agent shall
be named as additional insured on all general liability insurance policies
(excluding, for the avoidance of doubt , directors and officers, worker’s
compensation, health and benefit, and vehicle and similar liability policies) of
such Grantor and the Administrative Agent shall be named as loss payee on all
property and casualty insurance policies of such Grantor with respect to
Collateral. All such insurance shall (i) provide that the relevant insurer shall
endeavor to provide the Administrative Agent with at least 15 days prior notice
of the cancellation of the relevant policy of insurance and (ii) if reasonably
requested by the Administrative Agent, include a breach of warranty clause.

 

5.4.         [Reserved].

 

5.5.         Maintenance of Perfected Security Interest; Further Documentation. 
(a)  Subject to the provisions of Section 5.10(d) of the Credit Agreement and
Section 3(b) hereof, such Grantor shall maintain the security interest created
by this Agreement on the Collateral as a perfected security interest having at
least the priority described in Section 4.3 until the Collateral is released
from such security interest pursuant to the terms of Section 9.14 of the Credit
Agreement or by operation of law or by agreement of the requisite Lenders or all
Lenders and shall defend such security interest against the claims and demands
of all Persons whomsoever (subject to Permitted Liens).

 

(b)           Such Grantor will furnish to the Administrative Agent from time to
time statements and schedules further identifying and describing the assets of
such Grantor and such other reports in connection therewith as the
Administrative Agent may reasonably request, all in reasonable detail.

 

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(c)           Subject to the provisions of Section 5.10(d) of the Credit
Agreement and Section 3(b) hereof, at any time and from time to time, upon the
written request of the Administrative Agent, and at the sole expense of such
Grantor, such Grantor will promptly and duly authorize, execute and deliver, and
have recorded, such further instruments and documents and take such further
actions as the Administrative Agent may reasonably request for the purpose of
obtaining or preserving the full benefits of this Agreement and of the rights
and powers herein granted, including, without limitation, the filing of any
financing or continuation statements under the Uniform Commercial Code (or other
similar laws) in effect in any jurisdiction within the United States with
respect to the security interests created hereby.

 

5.6.         Changes in Locations, Name, Jurisdiction of Incorporation, etc. 
Such Grantor will not, except upon 15 days’ prior written notice to the
Administrative Agent and delivery to the Administrative Agent of all additional
financing statements and any other documents necessary to maintain the validity,
perfection and priority of the security interests in the Collateral provided for
herein, subject to the provisions of Section 5.10(d) of the Credit Agreement and
Section 3(b) hereof, (i) change its jurisdiction of organization or, in the case
of Grantors which are not registered organizations (within the meaning of the
Uniform Commercial Code), the location of its chief executive officer or the
sole place of business from that referred to on Schedule 4 or (ii) change its
name.

 

5.7.         Notices.  Such Grantor will advise the Administrative Agent for
further delivery to the Lenders promptly, in reasonable detail, of the
occurrence of any event which would reasonably be expected to have a material
adverse effect on the aggregate value of the Collateral or on the security
interests created hereby.

 

5.8.         Investment Property.  (a)  Each Grantor shall be entitled to
receive and retain any and all dividends, interest, principal and other
distributions paid on or in respect of the Pledged Securities to the extent and
only to the extent that such dividends, interest, principal and other
distributions are not prohibited by the terms of the Credit Agreement; provided
that any noncash dividends, interest, principal or other distributions that
would constitute Pledged Securities required to be delivered to the
Administrative Agent under this Agreement, whether resulting from a subdivision,
combination or reclassification of the outstanding Capital Stock of the issuer
of any Pledged Securities or received in exchange for Pledged Securities 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, subject to the terms of Section 5.10(d) of the
Credit Agreement and Section 3(b) hereof, (i) be and become part of the
Collateral, and (ii) if received by any Grantor, shall be held in trust for the
benefit of the Administrative Agent and shall be forthwith delivered to the
Administrative Agent in the same form as so received (with any necessary
endorsement reasonably requested by the Administrative Agent).  So long as no
Specified Default has occurred and is continuing, the Administrative Agent
shall, on terms to be agreed, deliver to each Grantor any Pledged Securities in
its possession if requested to be delivered to the issuer thereof in connection
with any exchange or redemption of such Pledged Securities not prohibited by the
Credit Agreement.

 

(b)           In the case of each Grantor which is an Issuer, such Issuer agrees
that (i) it will be bound by the terms of this Agreement relating to the Pledged
Securities issued by it that are included in the Collateral and will comply with
such terms insofar as such terms are

 

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applicable to it, and (ii) the terms of Sections 6.3(d) and 6.7 shall apply to
it, mutatis mutandis, with respect to all actions that may be required of it
pursuant to Section 6.3(d) or 6.7 with respect to the Pledged Securities issued
by it.  In addition, each Grantor which is either an Issuer or an owner of any
Pledged Security hereby consents to the grant by each other Grantor of the
security interest hereunder in favor of the Administrative Agent and to the
transfer of any Pledged Security to the Administrative Agent or its nominee
following the occurrence and during the continuation of an Event of Default and,
if an Event of Default has occurred and is continuing, to the substitution of
the Administrative Agent or its nominee as a partner, member or shareholder of
the Issuer of the related Pledged Security that are included in the Collateral. 
In addition, each Grantor which is either an Issuer or an owner of any Pledged
Security hereby consents to the grant by each other Grantor of the security
interest hereunder in favor of the Administrative Agent and to the transfer of
any Pledged Security to the Administrative Agent or its nominee following the
occurrence and during the continuation of an Event of Default and, if an Event
of Default has occurred and is continuing, to the substitution of the
Administrative Agent or its nominee as a partner, member or shareholder of the
Issuer of the related Pledged Security.

 

(c)                                  No interest of any Grantor in any limited
liability company or limited partnership included in the Collateral that
constitutes Pledged Capital Stock shall be represented by a certificate unless
(i) the limited liability company agreement or partnership agreement expressly
provides that such interests shall be a “security” within the meaning of
Article 8 of the UCC of the applicable jurisdiction, and (ii) such certificate
shall be delivered to the Administrative Agent to the extent required by
Section 5.2.

 

5.9.                            [Reserved].

 

5.10.                     Intellectual Property.  (a)  Except as otherwise
determined by such Grantor in its reasonable business judgment, with respect to
each material Trademark owned by such Grantor that is included in the
Collateral, such Grantor (either itself or through licensees) will (i) continue
to use such Trademark in order to maintain such Trademark in full force free
from any claim of abandonment for non-use consistent with Section 5.10(h) below,
(ii) maintain the quality of products and services offered under such Trademark,
(iii) not adopt or use any mark which is confusingly similar or a colorable
imitation of such Trademark unless the Administrative Agent, for the ratable
benefit of the Secured Parties, shall obtain a perfected security interest in
such mark pursuant to this Agreement, and (iv) not (and not affirmatively permit
any licensee or sublicensee thereof to) do any act or knowingly omit to do any
act whereby such Trademark may become invalidated or impaired in any way, other
than acts taken in the ordinary course of such Grantor’s business, consistent
with commercially reasonable practice.

 

(b)                                 Such Grantor will not (and will not
affirmatively permit any licensee or sublicensee thereof to) do any act, or omit
to do any act, whereby any material Patent owned by such Grantor may become
forfeited, abandoned or dedicated to the public, except to the extent that such
Grantor determines in its reasonable business judgment that the maintenance
thereof is no longer necessary to the conduct of such Grantor’s business.

 

(c)                                  Such Grantor will not (and will not
affirmatively permit any licensees and sublicensees to) do any act or knowingly
omit to do any act whereby any material Copyrights

 

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may become invalidated or otherwise dedicated to the public, except to the
extent that such Grantor determines in its reasonable business judgment that
such Copyright is no longer necessary to the conduct of such Grantor’s
business.  Such Grantor will not (and will not affirmatively permit any
licensees and sublicensees thereof to) do any act whereby any material
Copyrights could reasonably be expected to fall into the public domain, except
to the extent that such Grantor determines in its reasonable business judgment
that the maintenance thereof is no longer necessary to the conduct of such
Grantor’s business.

 

(d)                                 Except as set forth on Schedule 5 hereto or
except, with respect to Intellectual Property used or registered outside of the
United States, as would not be reasonably expected to have a Material Adverse
Effect, such Grantor will not (and will not affirmatively permit any licensees
and sublicensees thereof to) do any act that knowingly uses any material
Intellectual Property to Infringe the intellectual property rights of any other
Person.

 

(e)                                  Such Grantor will notify the Administrative
Agent promptly if it knows that any application or registration relating to any
material Intellectual Property included in the Collateral could reasonably be
expected to become forfeited, abandoned or dedicated to the public, or of any
adverse determination or development (including, without limitation, the
institution of, or any such determination or development in, any proceeding in
the United States Patent and Trademark Office or the United States Copyright
Office) regarding such Grantor’s ownership of, or the validity of, any material
Intellectual Property or such Grantor’s right to register the same or to own and
maintain the same in each case, that would reasonably be expected to have a
Material Adverse Effect.

 

(f)                                   Whenever such Grantor, either by itself or
through any agent, employee, licensee or designee, shall acquire, become the
exclusive licensee of, or file an application for the registration of any
Intellectual Property included in the Collateral with the United States Patent
and Trademark Office or the United States Copyright Office or any similar office
or agency in any other country or political subdivision thereof, such Grantor
shall report such filing to the Administrative Agent in accordance with
Section 5.2(b) of the Credit Agreement.  Upon request of the Administrative
Agent, subject to Section 5.10(d) of the Credit Agreement and
Section 3(b) hereof, such Grantor shall execute and deliver, and have recorded,
any and all agreements, instruments, documents, and papers as the Administrative
Agent may reasonably request to evidence the Secured Parties’ security interest
in any Collateral consisting of any Copyright, Patent, Trademark or other
Intellectual Property of such Grantor registered in the United States Patent and
Trademark Office or the United States Copyright Office.

 

(g)                                  Such Grantor will take all reasonable and
necessary steps if and to the extent such Grantor shall deem appropriate in its
reasonable business judgment under the circumstances, including, without
limitation, in any proceeding before the United States Patent and Trademark
Office or the United States Copyright Office, to maintain and pursue each
application (and to obtain the relevant registration) and to maintain each
registration of material Intellectual Property included in the Collateral owned
by such Grantor, (including, without limitation, the payment of required fees
and taxes, the filing of applications for renewal or extension, affidavits of
use and incontestability, and the participation in interference, reexamination,
opposition, cancellation, Infringement proceedings).

 

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(h)                                 Except as such Grantor determines in its
reasonable business judgment, such Grantor (either itself or through licensees)
will not, without the prior written consent of the Administrative Agent,
discontinue use of or otherwise abandon any Intellectual Property owned by such
Grantor, or abandon any application or any right to file an application for
letters patent, trademark, or copyright.

 

(i)                                     In the event that any material
Intellectual Property is Infringed by a third party, such Grantor shall take
such actions as such Grantor shall reasonably deem appropriate under the
circumstances to protect such Intellectual Property.

 

(j)                                    Such Grantor agrees to execute an
Intellectual Property Security Agreement with respect to its Registered
Intellectual Property included in the Collateral in substantially the form of
Exhibit B-1 in order to record the security interest granted herein to the
Administrative Agent for the ratable benefit of the Secured Parties with the
United States Patent and Trademark Office or the United States Copyright Office,
as applicable.

 

(k)                                 Such Grantor agrees that, should it obtain
an ownership interest in any item of Registered Intellectual Property included
in the Collateral which is not now a part of the Intellectual Property
Collateral (the “After-Acquired Intellectual Property”), (i) the provisions of
Section 3 shall automatically apply thereto and (ii) any such After-Acquired
Intellectual Property shall automatically become part of the Intellectual
Property Collateral.  At such time as the Borrower provides the Administrative
Agent with notice of any newly acquired, created or developed registered
Intellectual Property owned by such Grantor pursuant to Section 5.2(b) of the
Credit Agreement, such Grantor shall execute an After-Acquired Intellectual
Property Security Agreement with respect to its After-Acquired Intellectual
Property in substantially the form of Exhibit B-2 in order to record the
security interest granted herein to the Administrative Agent for the ratable
benefit of the Secured Parties with the United States Patent and Trademark
Office or the United States Copyright Office, as applicable.

 

5.11.                     Commercial Tort Claims.  If such Grantor shall obtain
an interest in any Commercial Tort Claim with a potential aggregate value in
excess of $5,000,000 (as reasonably determined by such Grantor) and for which a
complaint in a court proceeding has been filed by such Grantor, such Grantor
shall within 30 days of initiating such proceeding sign and deliver
documentation reasonably acceptable to the Administrative Agent granting a
security interest under the terms and provisions of this Agreement in and to
such Commercial Tort claim and the proceeds thereof.

 

SECTION 6                               REMEDIAL PROVISIONS

 

6.1.                            Certain Matters Relating to Receivables.  (a) 
If an Event of Default has occurred and is continuing, the Administrative Agent
shall have the right to make test verifications of the Receivables in any manner
and through any medium that it reasonably considers advisable, and each Grantor
shall furnish all such assistance and information as the Administrative Agent
may reasonably require in connection with such test verifications.

 

(b)                                 The Administrative Agent hereby authorizes
each Grantor to collect such Grantor’s Receivables; provided, however, that the
Administrative Agent may curtail or

 

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terminate said authority at any time upon written notice to the applicable
Grantor after the occurrence and during the continuance of an Event of Default. 
If required by the Administrative Agent in a written notice to such Grantor at
any time after the occurrence and during the continuance of an Event of Default,
any payments of Receivables, when collected by any Grantor, (i) shall be
forthwith (and, in any event, within two Business Days) deposited by such
Grantor in the exact form received, duly endorsed by such Grantor to the
Administrative Agent if required, in a Collateral Account maintained under the
control (within the meaning of Section 9-104 of the UCC) of the Administrative
Agent, subject to withdrawal by the Administrative Agent for the account of the
Secured Parties only as provided in Section 6.5, and (ii) until so turned over,
shall be held by such Grantor in trust for the Secured Parties, segregated from
other funds of such Grantor.  After the occurrence and during the continuance of
an Event of Default, if requested in writing by the Administrative Agent, each
such deposit of Proceeds of Receivables shall be accompanied by a report
identifying in reasonable detail the nature and source of the payments included
in the deposit.

 

(c)                                  If an Event of Default has occurred and is
continuing, at the Administrative Agent’s reasonable written request, each
Grantor shall deliver to the Administrative Agent all original and other
documents evidencing, and relating to, the agreements and transactions which
gave rise to the Receivables, including, without limitation, all original
orders, invoices and shipping receipts.

 

6.2.                            Communications with Obligors; Grantors Remain
Liable.  (a)  The Administrative Agent in its own name or in the name of others
may at any time when an Event of Default has occurred and is continuing
communicate with obligors under the Receivables to verify with them to the
Administrative Agent’s satisfaction the existence, amount and terms of any
Receivables.

 

(b)                                 The Administrative Agent may at any time
after an Event of Default has occurred and is continuing require any Grantor to
notify the Account Debtor or counterparty on any Receivable of the security
interest of the Administrative Agent therein.  In addition, after the occurrence
and during the continuance of an Event of Default, the Administrative Agent may
require any Grantor to notify the Account Debtor or counterparty to make all
payments under the Receivables directly to the Administrative Agent.

 

(c)                                  Anything herein to the contrary
notwithstanding, each Grantor shall remain liable under each of the Receivables
to observe and perform all the conditions and obligations to be observed and
performed by it thereunder, all in accordance with the terms of any agreement
giving rise thereto.  No Secured Party shall have any obligation or liability
under any Receivable (or any agreement giving rise thereto) by reason of or
arising out of this Agreement or the receipt by any Secured Party of any payment
relating thereto, nor shall any Secured Party be obligated in any manner to
perform any of the obligations of any Grantor under or pursuant to any
Receivable (or any agreement giving rise thereto), to make any payment, to make
any inquiry as to the nature or the sufficiency of any payment received by it or
as to the sufficiency of any performance by any party thereunder, to present or
file any claim, to take any action to enforce any performance or to collect the
payment of any amounts which may have been assigned to it or to which it may be
entitled at any time or times.

 

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6.3.                            Pledged Securities.  (a)  Unless an Event of
Default shall have occurred and be continuing and the Administrative Agent shall
have given written notice to the relevant Grantor of the Administrative Agent’s
intent to exercise its corresponding rights pursuant to Section 6.3(b), each
Grantor shall be permitted to receive all dividends, interest, principal or
other payments or distributions paid or made in respect of the Pledged
Securities, to the extent not prohibited by the Credit Agreement, and to
exercise all voting and corporate or other ownership rights with respect to the
Pledged Securities; provided, however, that no vote shall be cast or corporate
or other ownership right exercised or other action taken which would reasonably
be expected to impair in any material respect the value of the assets included
in the Collateral or which would violate any provision of this Agreement or any
other Loan Document.

 

(b)                                 If an Event of Default shall occur and be
continuing and the Administrative Agent shall have given written notice to the
Borrower of the Administrative Agent’s intent to execute its rights pursuant to
this Section 6.3(b):  (i)  the Administrative Agent shall have the right to
receive any and all dividends, interest, principal or other payments or
distributions paid in respect to the Pledged Securities included in the
Collateral and make application thereof to the Obligations in accordance with
Section 6.5 hereof, (ii) all rights of each Grantor to exercise or refrain from
exercising the voting and other consensual rights which it would otherwise be
entitled to exercise pursuant hereto shall cease and all such rights shall
thereupon become vested in the Administrative Agent which shall thereupon have
the sole right, but shall be under no obligation, to exercise or refrain from
exercising such voting and other consensual rights and (iii) the Administrative
Agent shall have the right, without notice to any Grantor, to transfer all or
any portion of the Investment Property included in the Collateral to its name or
the name of its nominee or agent or the name of the applicable Grantor, endorsed
or assigned in blank in favor of the Administrative Agent, and each Grantor will
promptly following request give to the Administrative Agent copies of any
notices or other communications received by it with respect to Pledged
Securities included in the Collateral registered in the name of such Grantor. 
In addition, if an Event of Default has occurred and is continuing, the
Administrative Agent shall have the right at any time, without notice to any
Grantor, to exchange any certificates or instruments representing any Investment
Property included in the Collateral for certificates or instruments of smaller
or larger denominations.  In order to permit the Administrative Agent to
exercise the voting and other consensual rights which it may be entitled to
exercise pursuant hereto and to receive all dividends and other distributions
which it may be entitled to receive hereunder if an Event of Default has
occurred and is continuing each Grantor shall promptly execute and deliver (or
cause to be executed and delivered) to the Administrative Agent all proxies,
dividend payment orders and other instruments as the Administrative Agent may
from time to time reasonably request and each Grantor acknowledges that the
Administrative Agent may utilize the power of attorney set forth herein.  All
dividends, interest, principal or other payments or distributions received by
any Grantor contrary to the provisions of this Section 6.3(b) shall be held in
trust for the benefit of the Administrative Agent, shall be segregated from
other property or funds of such Grantor and shall be promptly delivered to the
Administrative Agent upon demand in the same form as so received (with any
necessary endorsement reasonably requested by the Administrative Agent).

 

(c)                                  Any notice given by the Administrative
Agent to the Borrower or any other Grantor under this Section 6.3 (i) shall be
given in writing, (ii) may be given with respect to one or more of the Grantors
at the same or different times and (iii) may suspend the rights of

 

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the Grantors under paragraph (a) or (b) of this Section 6.3 in part without
suspending all such rights (as specified by the Administrative Agent in its sole
and absolute discretion) and without waiving or otherwise affecting the
Administrative 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.

 

(d)                                 Each Grantor hereby authorizes and instructs
each Issuer of any Pledged Securities pledged by such Grantor hereunder to
(i) comply with any instruction received by it from the Administrative Agent in
writing that (x) states that an Event of Default has occurred and is continuing
and (y) is otherwise in accordance with the terms of this Agreement, without any
other or further instructions from such Grantor, and each Grantor agrees that
each Issuer shall be fully protected in so complying, and (ii) unless otherwise
expressly permitted hereby, pay any dividends or other payments with respect to
the Pledged Securities directly to the Administrative Agent.  The Administrative
Agent acknowledges and agrees that the provisions of this Section 6.3(d) satisfy
the requirements of Section 5.2(d) with respect to each Issuer that is a
Grantor.

 

6.4.                            Proceeds to be Turned Over To Administrative
Agent.  In addition to the rights of the Secured Parties specified in
Section 6.1 with respect to payments of Receivables, if an Event of Default
shall occur and be continuing, at the written request of the Administrative
Agent, all Proceeds of Collateral received by any Grantor consisting of cash,
Cash Equivalents and checks shall be held by such Grantor in trust for the
Secured Parties, segregated from other funds of such Grantor, and shall,
forthwith upon receipt by such Grantor, be turned over to the Administrative
Agent in the exact form received by such Grantor (duly endorsed by such Grantor
to the Administrative Agent, if reasonably required).  All such Proceeds of
Collateral received by the Administrative Agent under this Section 6.4 shall be
held by the Administrative Agent in a Collateral Account maintained under its
control (as defined in Section 9-104 of the UCC).  All such Proceeds while held
by the Administrative Agent in a Collateral Account (or by such Grantor in trust
for the Secured Parties) shall continue to be held as collateral security for
all the Obligations and shall not constitute payment thereof until applied as
provided in Section 6.5.

 

6.5.                            Application of Proceeds.  If an Event of Default
shall have occurred and be continuing, at any time at the Administrative Agent’s
election, the Administrative Agent may, notwithstanding the provisions of
Section 2.15 of the Credit Agreement, apply all or any part of the net Proceeds
(after deducting fees and expenses as provided in Section 6.6) constituting
Collateral realized through the exercise by the Administrative Agent of its
remedies hereunder, whether or not held in any Collateral Account, and any
proceeds of the guarantee set forth in Section 2, in payment of the Obligations
in the following order (provided that if the terms of any Permitted Amendment
provide for application of such Proceeds to the payment of any Obligations in a
less favorable order, the terms of such Permitted Amendment shall govern with
respect to such Obligations and the Administrative Agent shall apply such
Proceeds in such different order):

 

First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (other than principal and interest, but
including attorneys fees payable under the Credit Agreement and under Section 2
of this Agreement) payable to the Administrative Agent in its capacity as such;

 

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Second, to payment of that portion of the Obligations constituting fees,
indemnities and other amounts (other than principal and interest and other
amounts described in clause Fourth below and, to the extent payable under clause
First, attorneys fees) payable to the Lenders (including attorneys fees payable
under the Credit Agreement and under Section 2 of this Agreement), ratably among
them in proportion to the amounts described in this clause Second payable to
them;

 

Third, to payment of that portion of the Obligations constituting accrued and
unpaid interest on the Loans and LC Disbursements, ratably among the holders of
such Obligations in proportion to the respective amounts described in this
clause Third payable to them;

 

Fourth, to payment of that portion of the Obligations constituting unpaid
principal of the Loans and LC Disbursements, to amounts then due and payable
under Specified Hedge Agreements with Qualified Counterparties and Cash
Management Obligations then due and payable and, to the extent required under
Section 2.8(j) of the Credit Agreement, to cash collateralize the portion of the
LC Disbursements comprised of the aggregate undrawn amount of Letters of Credit,
ratably among the holders of such Obligations in proportion to the respective
amounts described in this clause Fourth held by them;

 

Fifth, to the payment of all other Obligations of the Loan Parties that are then
due and payable to the Administrative Agent and the other Secured Parties on
such date, ratably based upon the respective aggregate amounts of all such
Obligations owing to the Administrative Agent and the other Secured Parties on
such date;

 

Sixth, to cash collateralize any Obligations not then due and payable, ratably
among the holders of such Obligations in proportion to the respective amounts
described in this clause Sixth held by them; and

 

Last, the balance, if any, after all of the Obligations have been paid in full,
to the Borrower or as otherwise required by Law.

 

6.6.                            Code and Other Remedies.  (a)  If an Event of
Default shall occur and be continuing, the Administrative Agent, on behalf of
the Secured Parties, may exercise, in addition to all other rights and remedies
granted to them in this Agreement and in any other instrument or agreement
securing, evidencing or relating to the Obligations, all rights and remedies of
a secured party under the New York UCC (whether or not the New York UCC applies
to the affected Collateral) or its rights under any other applicable law or in
equity.  Without limiting the generality of the foregoing, the Administrative
Agent, without demand of performance or other demand, presentment, protest,
advertisement or notice of any kind (except any notice required by law referred
to below) to or upon any Grantor or any other Person (all and each of which
demands, defenses (other than the defense of payment or performance of the
Discharge of Obligations), advertisements and notices are hereby waived), may in
such circumstances forthwith collect, receive, appropriate and realize upon the
Collateral, or any part thereof, or consent to the use by any Grantor of any
cash collateral arising in respect of the Collateral on such terms as the
Administrative Agent deems reasonable, and/or may forthwith sell, lease,

 

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license, assign, give option or options to purchase, or otherwise dispose of and
deliver, or acquire by credit bid on behalf of the Secured Parties, the
Collateral or any part thereof (or contract to do any of the foregoing), in one
or more parcels at public or private sale or sales, at any exchange, broker’s
board or office of any Secured Party or elsewhere upon such terms and conditions
as it may deem advisable and at such prices as it may deem best, for cash or on
credit or for future delivery without assumption of any credit risk, it being
understood that a Secured Party will be subject to the commercially reasonable
requirements under the UCC with respect to any disposition of Collateral.  Each
Secured Party shall have the right upon any such public sale or sales, and, to
the extent permitted by law, upon any such private sale or sales, to purchase
the whole or any part of the Collateral so sold, free of any right or equity of
redemption in any Grantor, which right or equity is hereby waived and released. 
To the fullest extent permitted by applicable law, each purchaser at any such
sale shall hold the property sold to it absolutely free from any claim or right
on the part of any Grantor, and each Grantor hereby waives (to the extent
permitted by applicable law) all rights of redemption, stay and/or appraisal
which it now has or may at any time in the future have under any rule of law or
statute now existing or hereafter enacted.  Each Grantor agrees that, to the
extent notice of sale shall be required by law, at least ten (10) days’ notice
to such Grantor of the time and place of any public sale or the time after which
any private sale is to be made shall constitute reasonable notification.  The
Administrative Agent shall not be obligated to make any sale of Collateral
regardless of notice of sale having been given.  The Administrative Agent may
adjourn any public or private sale from time to time by announcement at the time
and place fixed therefor, and such sale may, without further notice, be made at
the time and place to which it was so adjourned.  The Administrative Agent may
sell the Collateral without giving any warranties as to the Collateral.  The
Administrative Agent may specifically disclaim or modify any warranties of title
or the like.  To the fullest extent permitted by applicable law, this procedure
will not be considered to adversely affect the commercial reasonableness of any
sale of the Collateral.  Each Grantor agrees that it would not be commercially
unreasonable for the Administrative Agent to dispose of the Collateral or any
portion thereof by using Internet sites that provide for the auction of assets
of the types included in the Collateral or that have the reasonable capability
of doing so, or that match buyers and sellers of assets.  To the extent
permitted by applicable law, each Grantor waives all claims, damages and demands
it may acquire against the Administrative Agent or any Secured Party arising out
of the exercise by them of any of their rights hereunder. Each Grantor further
agrees, at the Administrative Agent’s request, if an Event of Default has
occurred and is continuing, to assemble the Collateral and make it available to
the Administrative Agent at places which the Administrative Agent shall
reasonably select, whether at such Grantor’s premises or elsewhere.

 

(b)                                 The Administrative Agent shall apply the net
proceeds of any action taken by it pursuant to this Section 6.6, after deducting
all reasonable costs and expenses of the Administrative Agent of every kind
incurred in connection therewith or incidental to the care or safekeeping of any
of the Collateral or in any way relating to the Collateral or the rights of the
Secured Parties hereunder, including, without limitation, reasonable attorneys’
fees and disbursements, to the payment in whole or in part of the Obligations in
accordance with Section 6.5 hereof and only after such application and after the
payment by the Administrative Agent of any other amount required by any
provision of law, including, without limitation, Section 9-615(a) of the New
York UCC, need the Administrative Agent account for the surplus, if any, to any
Grantor.  If the Administrative Agent sells any of the Collateral upon credit,
the Grantor will be credited only with payments actually made by the purchaser
and received by the

 

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Administrative Agent and applied to indebtedness of the purchaser.  In the event
the purchaser fails to pay for the Collateral, the Administrative Agent may
resell the Collateral and the Grantor shall be credited with proceeds of the
sale.  To the extent permitted by applicable law, each Grantor waives all
claims, damages and demands it may acquire against any Secured Party arising out
of the exercise by them of any rights hereunder.

 

6.7.                            Registration Rights.  (a)  If the Administrative
Agent shall determine to exercise its right to sell all or substantially all of
the Pledged Capital Stock or the Pledged Debt Securities included in the
Collateral pursuant to Section 6.6, and if in the reasonable opinion of the
Administrative Agent it is necessary to have such Pledged Capital Stock or
Pledged Debt Securities, or that portion thereof to be sold, registered under
the provisions of the Securities Act, the relevant Grantor will cause the Issuer
thereof to (i) execute and deliver, and cause the directors and officers of such
Issuer to execute and deliver, all such instruments and documents, and do or
cause to be done all such other acts as may be, in the opinion of the
Administrative Agent, necessary to register such Pledged Capital Stock or
Pledged Debt Securities, or that portion thereof to be sold, under the
provisions of the Securities Act, (ii) use its best efforts to cause the
registration statement relating thereto to become effective and to remain
effective for a period of one year from the date of the first public offering of
such Pledged Capital Stock or Pledged Debt Securities, or that portion thereof
to be sold, and (iii) make all amendments thereto and/or to the related
prospectus which, in the opinion of the Administrative Agent, are necessary, all
in conformity with the requirements of the Securities Act and the rules and
regulations of the SEC applicable thereto.  Each Grantor agrees to cause such
Issuer to comply with the provisions of the securities or “Blue Sky” laws of any
and all jurisdictions which the Administrative Agent shall reasonably designate
and to make available to its security holders, as soon as practicable, an
earnings statement (which need not be audited) which will satisfy the provisions
of Section 11(a) of the Securities Act.

 

(b)                                 Each Grantor recognizes that the
Administrative Agent may be unable to effect a public sale of any or all the
Pledged Capital Stock or the Pledged Debt Securities included in the Collateral,
by reason of certain prohibitions contained in the Securities Act and applicable
state securities laws or otherwise, and may be compelled to resort to one or
more private sales thereof to a restricted group of purchasers which will be
obliged to agree, among other things, to acquire such securities for their own
account for investment and not with a view to the distribution or resale
thereof.  Each Grantor acknowledges and agrees that any such private sale may
result in prices and other terms less favorable than if such sale were a public
sale and, notwithstanding such circumstances, agrees that any such private sale
shall be deemed to have been made in a commercially reasonable manner.  The
Administrative Agent shall be under no obligation to delay a sale of any of the
Pledged Capital Stock or the Pledged Debt Securities included in the Collateral
for the period of time necessary to permit the Issuer thereof to register such
securities for public sale under the Securities Act, or under applicable state
securities laws, even if such Issuer would agree to do so.

 

(c)                                  Each Grantor agrees to use its best efforts
to do or cause to be done all such other acts as may be necessary to make such
sale or sales of all or any portion of the Pledged Capital Stock or the Pledged
Debt Securities included in the Collateral pursuant to this Section 6.7 valid
and binding and in compliance with any and all other applicable Requirements of
Law.  Each Grantor further agrees that a breach of any of the covenants
contained in this

 

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Section 6.7 will cause irreparable injury to the Secured Parties, that the
Secured Parties have no adequate remedy at law in respect of such breach and, as
a consequence, that (to the maximum extent permitted by applicable law) each and
every covenant contained in this Section 6.7 shall be specifically enforceable
against such Grantor, and such Grantor hereby waives and agrees not to assert
(to the maximum extent permitted by applicable law) any defenses against an
action for specific performance of such covenants except for a defense that no
Event of Default has occurred and is continuing under the Credit Agreement or a
defense of payment or performance or the Discharge of Obligations.

 

6.8.                            Waiver; Deficiency.  Each Grantor shall remain
liable for any deficiency if the proceeds of any sale or other disposition of
the Collateral are insufficient to pay its Obligations and the fees and
disbursements of any attorneys employed by any Secured Party to collect such
deficiency.

 

SECTION 7                               THE ADMINISTRATIVE AGENT

 

7.1.                            Administrative Agent’s Appointment as
Attorney-in-Fact, etc.  (a)  Each Grantor hereby irrevocably constitutes and
appoints the Administrative Agent and any officer or agent thereof, with full
power of substitution, as its true and lawful attorney-in-fact with full
irrevocable power and authority in the place and stead of such Grantor and in
the name of such Grantor or in its own name, for the purpose of carrying out the
terms of this Agreement, to take any and all appropriate action and to execute
any and all documents and instruments which may be necessary or desirable to
accomplish the purposes of this Agreement, and, without limiting the generality
of the foregoing, each Grantor hereby gives the Administrative Agent the power
and right, on behalf of such Grantor, without notice to or assent by such
Grantor, to do any or all of the following:

 

(i)                                                             in the name of
such Grantor or its own name, or otherwise, take possession of and endorse and
collect any checks, drafts, notes, acceptances or other instruments for the
payment of moneys due under any Receivable or with respect to any other
Collateral and file any claim or take any other action or proceeding in any
court of law or equity or otherwise deemed appropriate by the Administrative
Agent for the purpose of collecting any and all such moneys due under any
Receivable or with respect to any other Collateral whenever payable;

 

(ii)                                                          in the case of any
Intellectual Property, execute and deliver, and record or have recorded, any and
all agreements, instruments, documents and papers as the Administrative Agent
may request to evidence the Secured Parties’ security interest in such
Intellectual Property and the goodwill and general intangibles of such Grantor
relating thereto or represented thereby;

 

(iii)                                                       pay or discharge
taxes and Liens levied or placed on or threatened against the Collateral, effect
any repairs or any insurance called for by the terms of this Agreement and pay
all or any part of the premiums therefor and the costs thereof;

 

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(iv)                  execute, in connection with the exercise of any right or
remedy provided for in Section 6.6 or 6.7, any endorsements, assignments or
other instruments of conveyance or transfer with respect to the Collateral; and

 

(v)                   (1) direct any party liable for any payment under any of
the Collateral to make payment of any and all moneys due or to become due
thereunder directly to the Administrative Agent or as the Administrative Agent
shall direct; (2) ask or demand for, collect, and receive payment of and receipt
for, any and all moneys, claims and other amounts due or to become due at any
time in respect of or arising out of any Collateral; (3) sign and endorse any
invoices, freight or express bills, bills of lading, storage or warehouse
receipts, drafts against debtors, assignments, verifications, notices and other
documents in connection with any of the Collateral; (4) commence and prosecute
any suits, actions or proceedings at law or in equity in any court of competent
jurisdiction to collect the Collateral or any portion thereof and to enforce any
other right in respect of any Collateral; (5) defend any suit, action or
proceeding brought against such Grantor with respect to any Collateral;
(6) settle, compromise or adjust any such suit, action or proceeding and, in
connection therewith, give such discharges or releases as the Administrative
Agent may deem appropriate; (7) assign any Copyright, Patent or Trademark (along
with the goodwill of the business to which any such Copyright, Patent or
Trademark pertains) included in the Collateral, throughout the world for such
term or terms, on such conditions, and in such manner, as the Administrative
Agent shall in its sole discretion determine; and (8) generally, sell, transfer,
pledge and make any agreement with respect to, or consent to any use of cash
collateral arising in respect of, or otherwise deal with any of the Collateral
as fully and completely as though the Administrative Agent were the absolute
owner thereof for all purposes, and do, at the Administrative Agent’s option and
such Grantor’s expense, at any time, or from time to time, all acts and things
which the Administrative Agent reasonably deems necessary to protect, preserve
or realize upon the Collateral and the Secured Parties’ security interests
therein and to effect the intent of this Agreement, all as fully and effectively
as such Grantor might do.

 

Anything in this Section 7.1(a) to the contrary notwithstanding, the
Administrative Agent agrees that, except as expressly provided in
Section 7.1(b), it will not exercise any rights under the power of attorney
provided for in this Section 7.1(a) unless an Event of Default shall have
occurred and be continuing.

 

(b)           If any Grantor fails to perform or comply with any of its
agreements contained herein, the Administrative Agent, at its option, but
without any obligation so to do, may perform or comply, or otherwise cause
performance or compliance, with such agreement; provided, however, that unless
an Event of Default has occurred and is continuing or time is of the essence,
the Administrative Agent shall not exercise this power without first making
demand on the Grantor and the Grantor failing to comply therewith within any
applicable period of grace.

 

(c)           The expenses of the Administrative Agent incurred in connection
with actions undertaken as provided in this Section 7.1, together with interest
thereon at a rate per

 

27

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annum equal to the rate per annum at which interest would then be payable on
past due Revolving Credit Loans that are ABR Loans under the Credit Agreement,
from the date of payment by the Administrative Agent to the date reimbursed by
the relevant Grantor, shall be payable by such Grantor to the Administrative
Agent on demand.

 

(d)           Each Secured Party, by its authorization of the Administrative
Agent’s entering into this Agreement, consents to the exercise by the
Administrative Agent of any power, right or remedy provided for herein.  All
powers, authorizations and agencies contained in this Agreement are coupled with
an interest and are irrevocable until this Agreement is terminated and the
security interests created hereby are released.

 

7.2.         Duty of Administrative Agent.  The Administrative Agent’s sole duty
with respect to the custody, safekeeping and physical preservation of the
Collateral in its possession, under Section 9-207 of the New York UCC or
otherwise, shall be to deal with it in the same manner as the Administrative
Agent deals with similar property for its own account (which shall in no event
be less than commercially reasonable custody, safekeeping and physical
preservation).  Neither the Administrative Agent nor any other Secured Party nor
any of their respective officers, directors, partners, employees, agents,
attorneys and other advisors, attorneys-in-fact or affiliates shall be liable
for failure to demand, collect or realize upon any of the Collateral or for any
delay in doing so or shall be under any obligation to sell or otherwise dispose
of any Collateral upon the request of any Grantor or any other Person or to take
any other action whatsoever with regard to the Collateral or any part thereof. 
The powers conferred on the Secured Parties hereunder are solely to protect the
Secured Parties’ interests in the Collateral and shall not impose any duty upon
any Secured Party to exercise any such powers.  The Secured Parties shall be
accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of their officers, directors,
partners, employees, agents, attorneys and other advisors, attorneys-in-fact or
affiliates shall be responsible to any Grantor for any act or failure to act
hereunder, except to the extent that any such act or failure to act is found by
a final and nonappealable decision of a court of competent jurisdiction to have
resulted directly from their own gross negligence, bad faith or willful
misconduct.

 

7.3.         Financing Statements; Intellectual Property Filings.  (a)  Pursuant
to Section 9-509(b) of the New York UCC and any other applicable law, each
Grantor hereby authorizes the Administrative Agent to file or record financing
or continuation statements, and amendments thereto, and other filing or
recording documents or instruments with respect to the Collateral in such form
and in such offices as the Administrative Agent reasonably determines
appropriate to perfect or maintain the perfection of the security interests of
the Administrative Agent under this Agreement, subject to the terms of
Section 5.10(d) of the Credit Agreement and Section 3(b) hereof.  Each Grantor
agrees that such financing statements may describe the collateral in the same
manner as described in the Security Documents or as “all assets” or “all
personal property” of the undersigned, whether now owned or hereafter existing
or acquired by the undersigned or such other description as the Administrative
Agent reasonably determines is necessary or advisable.  Each Grantor hereby
ratifies and authorizes the filing by the Administrative Agent of any financing
statement with the respect to the Collateral made prior to the date hereof
pursuant to the Existing Guarantee and Collateral Agreement.

 

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(b)           The Administrative Agent is authorized to file with the United
States Patent and Trademark Office (“USPTO”) or the United States Copyright
Office (“USCO”) (or any successor office) such documents as may be necessary or
advisable for the purpose of perfecting, confirming, continuing, enforcing or
protecting the security interest in each item of Intellectual Property of each
Grantor included in the Collateral that is subject to registration or an
application to register in the USPTO or USCO, and naming any Grantor or the
Grantors as debtors and the Administrative Agent as secured party and shall
provide written notice to the Grantor prior to filing any such documents.

 

7.4.         Authority of Administrative Agent.  Each Grantor acknowledges that
the rights and responsibilities of the Administrative Agent under this Agreement
with respect to any action taken by the Administrative Agent or the exercise or
non-exercise by the Administrative Agent of any option, voting right, request,
judgment or other right or remedy provided for herein or resulting or arising
out of this Agreement shall, as between the Administrative Agent and the other
Secured Parties, be governed by the Credit Agreement and by such other
agreements with respect thereto as may exist from time to time among them, but,
as between the Administrative Agent and the Grantors, the Administrative Agent
shall be conclusively presumed to be acting as agent for the Secured Parties
with full and valid authority so to act or refrain from acting, and no Grantor
shall be under any obligation, or entitlement, to make any inquiry respecting
such authority.

 

SECTION 8          MISCELLANEOUS

 

8.1.         Amendments in Writing.  None of the terms or provisions of this
Agreement may be waived, amended, supplemented or otherwise modified except in
accordance with Section 9.2 of the Credit Agreement or pursuant to an Assumption
Agreement in substantially the form of Annex 1 hereto.

 

8.2.         Notices.  All notices, requests and demands to or upon the
Administrative Agent or any Grantor hereunder shall be effected in the manner
provided for in Section 9.1 of the Credit Agreement; provided that any such
notice, request or demand to or upon any Guarantor shall be addressed to such
Guarantor at its notice address set forth on Schedule 1.

 

8.3.         No Waiver by Course of Conduct; Cumulative Remedies.  No Secured
Party shall by any act (except by a written instrument pursuant to Section 8.1),
delay, indulgence, omission or otherwise be deemed to have waived any right or
remedy hereunder or to have acquiesced in any Default or Event of Default.  No
failure to exercise, nor any delay in exercising, on the part of any Secured
Party, any right, power or privilege hereunder shall operate as a waiver
thereof.  No single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise thereof or the exercise
of any other right, power or privilege.  A waiver by any Secured Party of any
right or remedy hereunder on any one occasion shall not be construed as a bar to
any right or remedy which such Secured Party would otherwise have on any future
occasion.  The rights and remedies herein provided are cumulative, may be
exercised singly or concurrently and are not exclusive of any other rights or
remedies provided by law.

 

29

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8.4.         Enforcement Expenses; Indemnification.  (a)  Each Guarantor agrees
to pay or reimburse each Lender for all its costs and expenses incurred in
collecting against such Guarantor under the guarantee contained in Section 2 or
otherwise enforcing or preserving any rights under this Agreement and the other
Loan Documents to which such Guarantor is a party, including, without
limitation, the fees and disbursements of counsel to each Secured Party and of
counsel to the Administrative Agent, in each case, to the extent the Borrower
would be required to do so pursuant to Section 9.3 of the Credit Agreement.

 

(b)           Each Guarantor agrees to pay, and to save each Secured Party
harmless from, any and all liabilities with respect to, or resulting from any
delay in paying, any and all stamp, excise, sales or other taxes which may be
payable or determined to be payable with respect to any of the Collateral or in
connection with any of the transactions contemplated by this Agreement, in each
case, to the extent the Borrower would be required to do so pursuant to
Section 9.3 of the Credit Agreement.

 

(c)           Each Guarantor agrees to pay, and to save the Lenders, the Agents
and Issuing Banks harmless from, any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever with respect to the execution, delivery,
enforcement, performance and administration of this Agreement, in each case, to
the extent the Borrower would be required to do so pursuant to Section 9.3 of
the Credit Agreement.

 

(d)           The agreements in this Section shall survive repayment of the
Obligations and all other amounts payable under the Credit Agreement and the
other Loan Documents.

 

(e)           Each Grantor agrees that the provisions of Section 9.3(c) of the
Credit Agreement are incorporated herein by reference, mutatis mutandis, as if
each reference therein to the Parent were a reference to such Grantor.

 

8.5.         Successors and Assigns.  This Agreement shall be binding upon the
successors and assigns of each Grantor and shall inure to the benefit of the
Secured Parties and their successors and assigns; provided that no Grantor may
assign, transfer or delegate any of its rights or obligations under this
Agreement without the prior written consent of the Administrative Agent.

 

8.6.         Set-Off.  Each Grantor hereby irrevocably authorizes each Lender at
any time and from time to time with the prior written consent of the
Administrative Agent (which consent shall not be required in connection with
customary set-offs in connection with Cash Management Obligations and Specified
Hedge Agreements), while an Event of Default pursuant to Section 7(a) of the
Credit Agreement shall have occurred and be continuing, without notice to such
Grantor or any other Grantor, any such notice being expressly waived by each
Grantor, to set-off and appropriate and apply any and all deposits (general or
special, time or demand, provisional or final) (excluding payroll, tax
withholding and trust account maintained in the ordinary course of business) in
any currency, and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent, matured or
unmatured, at any time held or owing by such Lender to or for the credit or the
account of such Grantor, or any part thereof in such amounts as such Lender may
elect, against and on account of

 

30

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the obligations and liabilities of such Grantor to such Lender hereunder and
claims of every nature and description of such Lender against such Grantor, in
any currency, whether arising hereunder, under the Credit Agreement, any other
Loan Document or otherwise, as such Lender may elect, whether or not any Lender
has made any demand for payment and although such obligations, liabilities and
claims may be contingent or unmatured.  Each Lender shall notify such Grantor
promptly of any such set-off and the application made by such Lender of the
proceeds thereof, provided that the failure to give such notice shall not affect
the validity of such set-off and application.  The rights of each Lender under
this Section are in addition to other rights and remedies (including, without
limitation, other rights of set-off) which such Lender may have.

 

8.7.         Counterparts.  This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts (including by
telecopy and other electronic transmission), and all of said counterparts taken
together shall be deemed to constitute one and the same instrument.

 

8.8.         Severability.  Any provision of this Agreement which is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

 

8.9.         Section Headings.  The Section headings used in this Agreement are
for convenience of reference only and are not to affect the construction hereof
or be taken into consideration in the interpretation hereof.

 

8.10.       Integration.  This Agreement and the other Loan Documents represent
the agreement of the Grantors, the Administrative Agent and the other Secured
Parties with respect to the subject matter hereof and thereof, and there are no
promises, undertakings, representations or warranties by any Secured Party
relative to subject matter hereof and thereof not expressly set forth or
referred to herein or in the other Loan Documents.

 

8.11.       GOVERNING LAW.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

 

8.12.       Submission to Jurisdiction; Waivers.  (a)  Each of the parties
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 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 shall 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

 

31

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other manner provided by law.  Notwithstanding the foregoing, any Agent or
Lender may bring an action or proceeding in a jurisdiction where Collateral is
located or deemed located.

 

(b)           The Borrower 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 in any court referred to in
paragraph (a) 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.

 

(c)           Each party to this Agreement irrevocably consents to service of
process in the manner provided for notices in Section 8.2.  Nothing in this
Agreement or any other Loan Document will affect the right of any party to this
Agreement to serve process in any other manner permitted by law.

 

8.13.       Acknowledgments.  Each Grantor hereby acknowledges that:

 

(a)           it has been advised by counsel in the negotiation, execution and
delivery of this Agreement and the other Loan Documents to which it is a party;

 

(b)           no Secured Party has any fiduciary relationship with or duty to
any Grantor arising out of or in connection with this Agreement or any of the
other Loan Documents, and the relationship between the Grantors, on the one
hand, and the Secured Parties, on the other hand, in connection herewith or
therewith is solely that of debtor and creditor; and

 

(c)           no joint venture is created hereby or by the other Loan Documents
or otherwise exists by virtue of the transactions contemplated hereby among the
Secured Parties or among the Grantors and the Secured Parties.

 

8.14.       Additional Grantors.  Each Subsidiary of the Borrower that is
required to become a party to this Agreement pursuant to Section 5.10 of the
Credit Agreement shall become a Grantor for all purposes of this Agreement upon
execution and delivery by such Subsidiary of an Assumption Agreement in
substantially the form of Annex 1 hereto.

 

8.15.       Releases.  (a)  Upon the Discharge of Obligations, this Agreement
and the security interests granted hereby shall automatically terminate and be
released, without the requirement for any further action by any Person, and the
Administrative Agent shall promptly (and the Secured Parties hereby authorize
the Administrative Agent to) take such action and execute any such documents as
may be reasonably requested by any Grantor and at such Grantor’s expense to
further document and evidence such termination and release, and the Guarantee
Obligations of the Guarantors hereunder shall automatically terminate and be
released, without the requirement for any further action by any Person and the
Administrative Agent shall promptly (and the Secured Parties hereby authorize
the Administrative Agent to) take such action and execute any such documents as
may be reasonably requested by any Guarantor and at such Guarantor’s expense to
further document and evidence such termination and release of the Guarantee
Obligations of the Guarantors hereunder.

 

32

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(b)           In the event that any Grantor conveys, sells, leases, assigns,
transfers or otherwise Disposes of all or any portion of any of the Capital
Stock or assets of any Grantor to a Person that is not (and is not required
hereunder to become) a Grantor hereunder in a transaction permitted under the
Credit Agreement, the security interests created hereunder in respect of such
Capital Stock or assets shall automatically terminate and be released, without
the requirement for any further action by any Person and the Administrative
Agent shall promptly (and the Secured Parties hereby authorize the
Administrative Agent to) take such action and execute any such documents as may
be reasonably requested by any Grantor and at such Grantor’s expense to further
document and evidence such termination and release of security interests
hereunder in respect of such Capital Stock or assets, and, in the case of a
transaction permitted under the Credit Agreement the result of which is that a
Guarantor would cease to be a Restricted Subsidiary or would become an Excluded
Subsidiary, the Guarantee Obligations created hereunder in respect of such
Guarantor (and all security interests granted by such Guarantor hereunder) shall
automatically terminate and be released, without the requirement for any further
action by any Person and the Administrative Agent shall promptly (and the
Secured Parties hereby authorize the Administrative Agent to) take such action
and execute any such documents as may be reasonably requested by such Guarantor
and at such Guarantor’s expense to further document and evidence such
termination and release of such security interests and such Guarantor’s
Guarantee Obligations hereunder.  Any representation, warranty or covenant
contained in this Agreement relating to any such Capital Stock, asset or
subsidiary of any Grantor shall no longer be deemed to be made with respect
thereto once such Capital Stock or asset or Subsidiary is so conveyed, sold,
leased, assigned, transferred or disposed of.

 

8.16.       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 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.

 

8.17.       Amendment and Restatement.  (a) This Agreement amends and restates
the Existing Guarantee and Collateral Agreement.  All terms, conditions,
agreements, covenants and representations and warranties contained in the
Existing Guarantee and Collateral Agreement remain in full force and effect,
except as expressly amended herein.  Nothing herein or in the other Loan
Documents shall impair or adversely affect the continuation of the liability of
the Borrower for the Borrower Obligations or of any other Grantor for the
Guarantor Obligations incurred before the date hereof and the security
interests, Liens and other interests in the Collateral granted, pledged and or
assigned by the Grantors to the Administrative Agent pursuant to the Existing
Guarantee and Collateral Agreement.

 

(b)           The amendment and restatement herein shall not, in any manner, be

 

33

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construed to constitute payment of, or impair, limit, cancel or extinguish, or
constitute a novation in respect of any of the obligations, liabilities and
indebtedness of the Grantors evidenced by or arising under the Existing
Guarantee and Collateral Agreement and the other Loan Documents, and the Lien
and security interests securing such obligations, liabilities and indebtedness,
which shall continue in full force and effect and shall not in any manner be
impaired, limited, terminated, waived or released.

 

(signature pages follow)

 

34

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

 

 

GNC CORPORATION

 

 

 

By:

/s/ Michel M. Nuzzo

 

 

Name: Michael M. Nuzzo

 

 

Title: Executive Vice President and CFO

 

 

 

 

GENERAL NUTRITION CENTERS, INC.

 

 

 

By:

/s/ Michel M. Nuzzo

 

 

Name: Michael M. Nuzzo

 

 

Title: Executive Vice President and CFO

 

 

 

 

GENERAL NUTRITION CORPORATION

 

 

 

 

By:

/s/ Michel M. Nuzzo

 

 

Name: Michael M. Nuzzo

 

 

Title: Executive Vice President and CFO

 

 

 

 

GENERAL NUTRITION INVESTMENT COMPANY

 

 

 

 

By:

/s/ Michel M. Nuzzo

 

 

Name: Michael M. Nuzzo

 

 

Title: Executive Vice President and CFO

 

 

 

 

GNC FUNDING, INC.

 

 

 

 

By:

/s/ Michel M. Nuzzo

 

 

Name: Michael M. Nuzzo

 

 

Title: Executive Vice President and CFO

 

 

 

 

GNC TRANSPORTATION, LLC

 

 

 

 

By:

/s/ James E. McBride

 

 

Name: James E. McBride

 

 

Title: Vice President

 

 

 

 

LUCKYVITAMIN CORPORATION

 

 

 

By:

/s/ Michel M. Nuzzo

 

 

Name: Michael M. Nuzzo

 

 

Title: Executive Vice President and CFO

 

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

 

JPMORGAN CHASE BANK, N.A.,

 

 

as Administrative Agent

 

 

 

 

 

By:

/s/ Barry K. Bergman

 

 

Name: Barry K. Bergman

 

 

Title: Managing Director

 

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

 

Exhibit A to

Guarantee and Collateral Agreement

 

FORM OF ACKNOWLEDGMENT AND CONSENT

 

Each of the undersigned hereby acknowledges receipt of a copy of the Guarantee
and Collateral Agreement dated as of November 26, 2013 (the “Agreement”), made
by the Grantors parties thereto in favor of JPMorgan Chase Bank, N.A., as
administrative agent; capitalized terms used but not defined herein have the
meanings given such terms therein.  Each of the undersigned agrees for the
benefit of the Administrative Agent and the Lenders as follows:

 

1.             The undersigned will be bound by the terms of the Agreement and
will comply with such terms insofar as such terms are applicable to the
undersigned.

 

2.             The undersigned will notify the Administrative Agent promptly in
writing of the occurrence of any of the events described in Section 5.8(a) of
the Agreement.

 

3.             The terms of Sections 6.3(d) and 6.7 of the Agreement shall apply
to it, mutatis mutandis, with respect to all actions that may be required of it
pursuant to Section 6.3(c) or 6.7 of the Agreement.

 

4.             This Acknowledgement may be executed by one or more of the
parties hereto on any number of separate counterparts (including by telecopy or
other electronic transmission), and all of said counterparts taken together
shall be deemed to constitute one and the same instrument.

 

 

[NAME OF ISSUERS]

 

 

 

 

 

By

 

 

 

Name:

 

 

Title:

 

 

 

Address for Notices:

 

 

 

 

 

 

 

 

 

Fax:

 

 

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Exhibit B-1 to

Guarantee and Collateral Agreement

 

FORM OF INTELLECTUAL PROPERTY SECURITY AGREEMENT

 

This INTELLECTUAL PROPERTY SECURITY AGREEMENT, dated as of November 26, 2013 (as
amended, restated, amended and restated, supplemented or otherwise modified from
time to time, this “Intellectual Property Security Agreement”), is made by each
of the signatories hereto (collectively, the “Grantors”) in favor of JPMorgan
Chase Bank, N.A., as administrative agent (together with its successors in such
capacity, the “Administrative Agent”) for the Secured Parties (as defined in the
Credit Agreement referred to below).

 

WHEREAS, GNC Corporation, a Delaware corporation, and General Nutrition
Centers, Inc., a Delaware corporation (the “Borrower”), have entered into a
Credit Agreement, dated as of November 26, 2013 (as amended, restated, amended
and restated, supplemented, replaced or otherwise modified from time to time,
the “Credit Agreement”), with the banks and other financial institutions and
entities from time to time party thereto as lenders (the “Lenders”), Goldman
Sachs Bank USA, as the Syndication Agent, and Deutsche Bank Securities Inc. and
Morgan Stanley Senior Funding, Inc., as the Co-Documentation Agents and the
Administrative Agent.  Capitalized terms used and not defined herein have the
meanings given such terms in the Credit Agreement.

 

WHEREAS, it is a condition precedent to the obligation of the Lenders to make
their respective extensions of credit to the Borrower under the Credit Agreement
that the Grantors shall have executed and delivered that certain Guarantee and
Collateral Agreement, dated as of November 26, 2013, in favor of the
Administrative Agent (as amended, restated, amended and restated, supplemented,
replaced or otherwise modified from time to time, the “Guarantee and Collateral
Agreement”).

 

WHEREAS, under the terms of the Guarantee and Collateral Agreement, the Grantors
have assigned and transferred to the Administrative Agent, and granted to the
Administrative Agent, for the ratable benefit of the Secured Parties, a security
interest in all of the Grantor’s right, title, and interest in and to certain
Collateral, including, without limitation, certain of its Intellectual Property 
and have agreed as a condition thereof to execute this Intellectual Property
Security Agreement with respect to certain of its Intellectual Property in order
to record the security interests granted therein with the United States Patent
and Trademark Office or the United States Copyright Office (or any successor
office or other applicable United States Governmental Authorities).

 

NOW, THEREFORE, in consideration of the above premises, the Grantors hereby
agree with the Administrative Agent, for the ratable benefit of the Secured
Parties, as follows:

 

SECTION 1.         Grant of Security.  Each Grantor hereby assigns and transfers
to the Administrative Agent, and hereby grants to the Administrative Agent, for
the ratable benefit of the Secured Parties, a security interest in all of such
Grantor’s right, title and interest in and to the following (the “Intellectual
Property Collateral”), as collateral security for the prompt and

 

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complete payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of such Grantor’s Obligations:

 

(a)           (i) all United States, state and foreign trademarks, service
marks, trade names, corporate names, company names, business names, trade dress,
trade styles, logos, or other indicia of origin or source
identification, Internet domain names, trademark and service mark registrations,
and applications for trademark or service mark registrations and any renewals
thereof, including, without limitation, each registration and application
identified in Schedule 1, and (ii)  the goodwill of the business connected with
the use of, and symbolized by, each of the above (collectively, the
“Trademarks”);

 

(b)           (i) all United States and foreign patents, patent applications and
patentable inventions, including, without limitation, each issued patent and
patent application identified in Schedule 1, and all certificates of invention
or similar property rights (ii) all inventions and improvements described and
claimed therein, and (iii) all reissues, divisions, reexaminations,
continuations, continuations-in-part, substitutes, renewals, and extensions
thereof, all improvements thereon (collectively, the “Patents”);

 

(c)           (i) all United States and foreign copyrights, whether or not the
underlying works of authorship have been published, including but not limited to
copyrights in software and databases, all Mask Works (as defined in 17 U.S.C.
901 of the U.S. Copyright Act) and all works of authorship and other
intellectual property rights therein, all right, title and interest to make and
exploit all derivative works based on or adopted from works covered by such
copyrights, and all copyright registrations, copyright applications, mask works
registrations and mask works applications, and any renewals or extensions
thereof, including, without limitation, each registration and application
identified in Schedule 1, and (ii) the rights to print, publish and distribute
any of the foregoing (“Copyrights”);

 

(d)           all trade secrets and all confidential and proprietary
information, including know-how, manufacturing and production processes and
techniques, inventions, research and development information, technical data,
financial, marketing and business data, pricing and cost information, business
and marketing plans, and customer and supplier lists and information, formulae,
parts, diagrams, drawings, specifications, blue prints, lists of materials, and
production manuals (collectively, the “Trade Secrets”);

 

(e)           (i) all Trademark Licenses (as defined in the Guarantee and
Collateral Agreement), Trade Secret Licenses (as defined in the Guarantee and
Collateral Agreement), Patent Licenses (as defined in the Guarantee and
Collateral Agreement), and Copyright Licenses (as defined in the Guarantee and
Collateral Agreement), in each case, to the extent Grantor is not the granting
party, including, without limitation, any of the foregoing identified in
Schedule 1; and

 

(f)            (i) the right to sue or otherwise recover for any and all past,
present and future Infringements (as defined in the Guarantee and Collateral
Agreement) and misappropriations of any of the property described (a) through
(e) above, and (ii) all income, royalties, damages and other payments now and
hereafter due and/or payable with respect to any of the property described in
(a) though (e) above.

 

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

 

SECTION 2.         Excluded Asset.  Notwithstanding anything to the contrary in
this Intellectual Property Security Agreement, none of the Excluded Assets (as
defined in the Credit Agreement) shall constitute Intellectual Property
Collateral.

 

SECTION 3.         Recordation.  Each Grantor authorizes and requests that the
Register of Copyrights, the Commissioner of Patents and Trademarks and any other
applicable United States government officer record this Intellectual Property
Security Agreement.

 

SECTION 4.         Execution in Counterparts.  This Intellectual Property
Security Agreement may be executed in any number of counterparts (including by
telecopy or other electronic transmission), each of which when so executed shall
be deemed to be an original and all of which taken together shall constitute one
and the same agreement.

 

SECTION 5.         GOVERNING LAW.  THIS INTELLECTUAL PROPERTY SECURITY AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF
NEW YORK.

 

SECTION 6.         Conflict Provision.  This Intellectual Property Security
Agreement has been entered into in conjunction with the provisions of the
Guarantee and Collateral Agreement and the Credit Agreement.  The rights and
remedies of each party hereto with respect to the security interest granted
herein are without prejudice to, and are in addition to those set forth in the
Guarantee and Collateral Agreement and the Credit Agreement, all terms and
provisions of which are incorporated herein by reference.  In the event that any
provisions of this Intellectual Property Security Agreement are in conflict with
the Guarantee and Collateral Agreement or the Credit Agreement, the provisions
of the Guarantee and Collateral Agreement or the Credit Agreement shall govern.

 

SECTION 7.         Releases.

 

(a)           Upon the Discharge of Obligations, this Intellectual Property
Security Agreement and the security interests granted hereby shall automatically
terminate and be released, without the requirement for any further action by any
Person, and the Administrative Agent shall promptly (and the Secured Parties
hereby authorize the Administrative Agent to) take such action and execute any
such documents as may be reasonably requested by any Grantor and at such
Grantor’s expense to further document and evidence such termination and release.

 

(b)           In the event that any Grantor conveys, sells, leases, assigns,
transfers or otherwise Disposes of all or any portion of assets of such Grantor
to a Person that is not (and is not required hereunder to become) a Grantor
hereunder in a transaction permitted under the Credit Agreement, the security
interests created hereunder in respect of such assets shall automatically
terminate and be released, without the requirement for any further action by any
Person and the Administrative Agent shall promptly (and the Secured Parties
hereby authorize the Administrative Agent to) take such action and execute any
such documents as may be reasonably requested by such Grantor and at such
Grantor’s expense to further document and evidence such termination and release
of security interests hereunder in respect of such assets, and, in the case of a
transaction permitted under the Credit Agreement the result of which is that

 

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

 

a Grantor would cease to be a Restricted Subsidiary or would become an Excluded
Subsidiary, all security interests granted hereunder by such Grantor shall
automatically terminate and be released, without the requirement for any further
action by any Person and the Administrative Agent shall promptly (and the
Secured Parties hereby authorize the Administrative Agent to) take such action
and execute any such documents as may be reasonably requested by such Grantor
and at such Grantor’s expense to further document and evidence such termination
and release of such security interests.

 

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

 

IN WITNESS WHEREOF, each of the undersigned has caused this Intellectual
Property Security Agreement to be duly executed and delivered as of the date
first above written.

 

 

[NAME OF GRANTOR]

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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

 

Schedule 1

 

COPYRIGHTS

 

PATENTS

 

TRADEMARKS

 

INTELLECTUAL PROPERTY LICENSES

 

 

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

 

Exhibit B-2 to

Guarantee and Collateral Agreement

 

FORM OF AFTER-ACQUIRED INTELLECTUAL PROPERTY SECURITY AGREEMENT

 

(FIRST SUPPLEMENTAL FILING)

 

This INTELLECTUAL PROPERTY SECURITY AGREEMENT (FIRST SUPPLEMENTAL FILING), dated
as of                         , 201    (as amended, restated, amended and
restated, supplemented or otherwise modified from time to time, the “First
Supplemental Intellectual Property Security Agreement”), is made by each of the
signatories hereto (collectively, the “Grantors”) in favor of JPMorgan Chase
Bank, N.A., as administrative agent (together with its successors in such
capacity, the “Administrative Agent”) for the Secured Parties (as defined in the
Credit Agreement referred to below).

 

WHEREAS, GNC Corporation, a Delaware corporation, and General Nutrition
Centers, Inc., a Delaware corporation (the “Borrower”), have entered into a
Credit Agreement, dated as of November 26, 2013 (as amended, restated, amended
and restated, supplemented, replaced or otherwise modified from time to time,
the “Credit Agreement”), with the banks and other financial institutions and
entities from time to time party thereto as lenders (the “Lenders”), Goldman
Sachs Bank USA, as the Syndication Agent, Deutsche Bank Securities Inc. and
Morgan Stanley Senior Funding, Inc., as the Co-Documentation Agents, and the
Administrative Agent.  Capitalized terms used and not defined herein have the
meanings given such terms in the Credit Agreement.

 

WHEREAS, it is a condition precedent to the obligation of the Lenders to make
their respective extensions of credit to the Borrower under the Credit Agreement
that the Grantors shall have executed and delivered that certain Guarantee and
Collateral Agreement, dated as of November 26, 2013, in favor of the
Administrative Agent (as amended, restated, amended and restated, supplemented,
replaced or otherwise modified from time to time, the “Guarantee and Collateral
Agreement”).

 

WHEREAS, under the terms of the Guarantee and Collateral Agreement, the Grantors
have assigned and transferred to the Administrative Agent, and granted to the
Administrative Agent, for the ratable benefit of the Secured Parties, a security
interest in all of the Grantors’ right, title and interest in and to certain
Collateral, including, without limitation, certain of its Intellectual Property
and have agreed as a condition thereof to execute this First Supplemental
Intellectual Property Security Agreement with respect to certain of its
After-Acquired Intellectual Property in order to record the security interests
granted therein with the United States Patent and Trademark Office, the United
States Copyright Office (or any successor office or other applicable United
States Governmental Authorities).

 

WHEREAS, the Intellectual Property Security Agreement was recorded against
certain United States Intellectual Property at [INSERT REEL/FRAME NUMBER] [IF
SECOND OR LATER SUPPLEMENTAL, ADD PRIOR REEL/FRAME NUMBERS].

 

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

 

NOW, THEREFORE, in consideration of the above premises, the Grantors hereby
agree with the Administrative Agent, for the ratable benefit of the Secured
Parties, as follows:

 

SECTION 1.         Grant of Security.  Each Grantor hereby assigns and transfers
to the Administrative Agent, and hereby grants to the Administrative Agent, for
the ratable benefit of the Secured Parties, a security interest in all of such
Grantor’s right, title and interest in and to the following (the “Intellectual
Property Collateral”), as collateral security for the prompt and complete
payment and performance when due (whether at the stated maturity, by
acceleration or otherwise) of such Grantor’s Obligations:

 

(c)           (i) all United States, state and foreign trademarks, service
marks, trade names, corporate names, company names, business names, trade dress,
trade styles, logos, or other indicia of origin or source
identification, Internet domain names, trademark and service mark registrations,
and applications for trademark or service mark registrations and any renewals
thereof, including, without limitation, each registration and application
identified in Schedule 1, and (ii)  the goodwill of the business connected with
the use of, and symbolized by, each of the above (collectively, the
“Trademarks”);

 

(d)           (i) all United States and foreign patents, patent applications and
patentable inventions, including, without limitation, each issued patent and
patent application identified in Schedule 1, and all certificates of invention
or similar property rights (ii) all inventions and improvements described and
claimed therein, and (iii) all reissues, divisions, reexaminations,
continuations, continuations-in-part, substitutes, renewals, and extensions
thereof, all improvements thereon (collectively, the “Patents”);

 

(e)           (i) all United States and foreign copyrights, whether or not the
underlying works of authorship have been published, including but not limited to
copyrights in software and databases, all Mask Works (as defined in 17 U.S.C.
901 of the U.S. Copyright Act) and all works of authorship and other
intellectual property rights therein, all right, title and interest to make and
exploit all derivative works based on or adopted from works covered by such
copyrights, and all copyright registrations, copyright applications, mask works
registrations and mask works applications, and any renewals or extensions
thereof, including, without limitation, each registration and application
identified in Schedule 1, and (ii) the rights to print, publish and distribute
any of the foregoing (“Copyrights”);

 

(f)            all trade secrets and all confidential and proprietary
information, including know-how, manufacturing and production processes and
techniques, inventions, research and development information, technical data,
financial, marketing and business data, pricing and cost information, business
and marketing plans, and customer and supplier lists and information, formulae,
parts, diagrams, drawings, specifications, blue prints, lists of materials, and
production manuals (collectively, the “Trade Secrets”);

 

(e)          all Trademark Licenses (as defined in the Guarantee and Collateral
Agreement), Trade Secret Licenses (as defined in the Guarantee and Collateral
Agreement), Patent Licenses (as defined in the Guarantee and Collateral
Agreement) and Copyright Licenses (as defined in the Guarantee and Collateral
Agreement), in each case, to the extent Grantor is not

 

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

 

the granting party, including, without limitation, any of the foregoing
identified in Schedule 1; and

 

(f)            (i) the right to sue or otherwise recover for any and all past,
present and future Infringements (as defined in the Guarantee and Collateral
Agreement) and misappropriations of any of the property described (a) through
(e) above, and (ii) all income, royalties, damages and other payments now and
hereafter due and/or payable with respect to any of the property described in
(a) though (e) above

 

SECTION 2.         Excluded Assets.  Notwithstanding anything to the contrary in
this First Supplemental Intellectual Property Security Agreement, none of the
Excluded Assets (as defined in the Credit Agreement) shall constitute
Intellectual Property.

 

SECTION 3.         Recordation.  Each Grantor authorizes and requests that the
Register of Copyrights, the Commissioner of Patents and Trademarks and any other
applicable United States government officer record this First Supplemental
Intellectual Property Security Agreement.

 

SECTION 4.         Execution in Counterparts.  This First Supplemental
Intellectual Property Security Agreement may be executed in any number of
counterparts (including by telecopy or other electronic transmission), each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.

 

SECTION 5.         GOVERNING LAW.  THIS FIRST SUPPLEMENTAL INTELLECTUAL PROPERTY
SECURITY AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH, THE
LAW OF THE STATE OF NEW YORK.

 

SECTION 6.         Conflict Provision.  This First Supplemental Intellectual
Property Security Agreement has been entered into in conjunction with the
provisions of the Guarantee and Collateral Agreement and the Credit Agreement. 
The rights and remedies of each party hereto with respect to the security
interest granted herein are without prejudice to, and are in addition to those
set forth in the Guarantee and Collateral Agreement and the Credit Agreement,
all terms and provisions of which are incorporated herein by reference.  In the
event that any provisions of this First Supplemental Intellectual Property
Security Agreement are in conflict with the Guarantee and Collateral Agreement
or the Credit Agreement, the provisions of the Guarantee and Collateral
Agreement or the Credit Agreement shall govern.

 

SECTION 7.         Releases.

 

(a)           Upon the Discharge of Obligations, this First Supplemental
Intellectual Property Security Agreement and the security interests granted
hereby shall automatically terminate and be released, without the requirement
for any further action by any Person, and the Administrative Agent shall
promptly (and the Secured Parties hereby authorize the Administrative Agent to)
take such action and execute any such documents as may be reasonably requested
by any Grantor and at such Grantor’s expense to further document and evidence
such termination and release.

 

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

 

(b)                                 In the event that any Grantor conveys,
sells, leases, assigns, transfers or otherwise Disposes of all or any portion of
assets of such Grantor to a Person that is not (and is not required hereunder to
become) a Grantor hereunder in a transaction permitted under the Credit
Agreement, the security interests created hereunder in respect of such assets
shall automatically terminate and be released, without the requirement for any
further action by any Person and the Administrative Agent shall promptly (and
the Secured Parties hereby authorize the Administrative Agent to) take such
action and execute any such documents as may be reasonably requested by such
Grantor and at such Grantor’s expense to further document and evidence such
termination and release of security interests hereunder in respect of such
assets, and, in the case of a transaction permitted under the Credit Agreement
the result of which is that a Grantor would cease to be a Restricted Subsidiary
or would become an Excluded Subsidiary, all security interests granted hereunder
by such Grantor shall automatically terminate and be released, without the
requirement for any further action by any Person and the Administrative Agent
shall promptly (and the Secured Parties hereby authorize the Administrative
Agent to) take such action and execute any such documents as may be reasonably
requested by such Grantor and at such Grantor’s expense to further document and
evidence such termination and release of such security interests.

 

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

 

IN WITNESS WHEREOF, each of the undersigned has caused this Intellectual
Property Security Agreement to be duly executed and delivered as of the date
first above written.

 

 

[NAME OF GRANTOR]

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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

 

Schedule 1

 

COPYRIGHTS

 

PATENTS

 

TRADEMARKS

 

INTELLECTUAL PROPERTY LICENSES

 

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

 

Exhibit C to
Guarantee and Collateral Agreement

 

FORM OF INTERCOMPANY SUBORDINATED DEMAND PROMISSORY NOTE

 

Note Number: [1]

 

Dated:                  , 201    

 

FOR VALUE RECEIVED, Parent, the Borrower and each of its Subsidiaries
(collectively, the “Group Members” and each, a “Group Member”) which is a party
to this intercompany subordinated demand promissory note (this “Promissory
Note”) promises to pay to the order of such other Group Member as makes loans to
such Group Member (each Group Member which borrows money pursuant to this
Promissory Note is referred to herein as a “Payor” and each Group Member which
makes loans and advances pursuant to this Promissory Note is referred to herein
as a “Payee”), on demand, in lawful money of the United States of America, in
immediately available funds and at the appropriate office of the Payee, the
aggregate unpaid principal amount of all loans and advances heretofore and
hereafter made by such Payee to such Payor and any other Indebtedness for
borrowed money now or hereafter owing by such Payor to such Payee as shown
either on Schedule A attached hereto (and any continuation thereof) or in the
books and records of such Payee.  The failure to show any such Indebtedness or
any error in showing such Indebtedness shall not affect the obligations of any
Payor hereunder.  Capitalized terms used herein but not otherwise defined herein
shall have the meanings given such terms in the Credit Agreement, dated as of
March 4, 2011, as amended, as amended and restated as of November 26, 2013 (as
further amended, restated, amended and restated, supplemented or otherwise
modified from time to time, the “Credit Agreement”), among GNC Corporation
(“Parent”), General Nutrition Centers, Inc. (the “Borrower”), the Lenders from
time to time party thereto, Goldman Sachs Bank USA, as the Syndication Agent,
Deutsche Bank Securities Inc. and Morgan Stanley Senior Funding, Inc., as the
Co-Documentation Agents and JPMorgan Chase Bank, N.A., as administrative agent
(in such capacity and including its successors and assigns, the “Administrative
Agent”).

 

The unpaid principal amount from time to time outstanding of all such loans,
advances and other Indebtedness owed by each Payor to the relevant Payee shall
bear interest at a rate per annum equal to the rate as may be agreed upon in
writing from time to time by such Payor and the relevant Payee.  Interest shall
be due and payable at such times as may be agreed upon in writing from time to
time by the relevant Payor and Payee.  Upon demand for payment of any principal
amount hereof, accrued but unpaid interest on such principal amount shall also
be due and payable.  Interest shall be paid in lawful money of the United States
of America and in immediately available funds.  Interest shall be computed for
the actual number of days elapsed on the basis of a year consisting of 365 days.

 

Each Payor and any endorser of this Promissory Note hereby waives presentment,
demand, protest and notice of any kind.  No failure to exercise, and no delay in
exercising, any rights hereunder on the part of the holder hereof shall operate
as a waiver of such rights.

 

This Promissory Note has been pledged by each Payee to the Administrative Agent,
for the benefit of the Secured Parties, as security for such Payee’s
Obligations, if any,

 

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

 

under the Credit Agreement, the Guarantee and Collateral Agreement and the other
Loan Documents to which such Payee is a party.  During the continuation of an
Event of Default the Administrative Agent may exercise all right of the
respective Payees hereunder.

 

Each Payee agrees that any and all obligations evidenced by this Promissory Note
that are owed by any Payor that is a Loan Party to any Payee other than the
Borrower or any other Loan Party shall be subordinate and junior in right of
payment to the Obligations until all of the Obligations have been paid in full
in immediately available funds (excluding Obligations in respect of any
Specified Hedge Agreements, Cash Management Obligations and contingent
reimbursement and indemnification obligations, in each case, that are not then
due and payable) and all Letters of Credit have expired or terminated or been
cash collateralized (in a manner consistent with Section 2.8(j) of the Credit
Agreement) or backed (in a manner reasonably satisfactory to the relevant
Issuing Bank) with other letters of credit and the Commitments under the Credit
Agreement have expired or been terminated (“Paid in Full”); provided, that each
Payor may make payments to the applicable Payee so long as no Event of Default
shall have occurred and be continuing.

 

If all or any part of the assets of any Payor, or the proceeds thereof, are
subject to any distribution, division or application to the creditors of any
Payor, whether partial or complete, voluntary or involuntary, and whether by
reason of liquidation, bankruptcy, arrangement, receivership, assignment for the
benefit of creditors or any other action or proceeding, or if the business of
any Payor is dissolved or if all or substantially all of the assets of any Payor
are sold (except, in each case, in a transaction permitted by the Credit
Agreement) then, and in any such event, any payment or distribution of any kind
or character, whether in cash, securities or other investment property or
otherwise, which shall be payable or deliverable upon or with respect to any
obligation of such Payor evidenced by this Promissory Note to any Payee that is
a Loan Party (“Payor Indebtedness”) at any time when an Event of Default has
occurred and is continuing shall, upon written demand by the Administrative
Agent, be paid or delivered directly to the Administrative Agent for application
in accordance with the Credit Agreement and the other Loan Documents to the
Obligations, until the date on which the Obligations shall have been Paid in
Full.  Each Payee that is a Loan Party irrevocably authorizes, empowers and
appoints the Administrative Agent as such Payee’s attorney-in-fact (which
appointment is coupled with an interest and is irrevocable) to, at any time when
an Event of Default has occurred and is continuing, demand, sue for, collect and
receive every such payment or distribution and give acquittance therefor and to
make and present for and on behalf of such Payee such proofs of claim and take
such other action, in the Administrative Agent’s own name or in the name of such
Payee or otherwise, as the Administrative Agent may reasonably deem necessary or
advisable for the enforcement of this Promissory Note.  Each Payee that is a
Loan Party also agrees to execute, verify, deliver and file any such proofs of
claim in respect of the Payor Indebtedness requested by the Administrative
Agent.  After the occurrence and during the continuance of an Event of Default
the Administrative Agent may vote such proofs of claim in any such proceeding
(and the applicable Payee Loan Party shall not be entitled to withdraw such
vote), receive and collect any and all dividends or other payments or
disbursements made on Payor Indebtedness in whatever form the same may be paid
or issued and apply the same on account of any of the Obligations.  Except as
otherwise expressly permitted under the Credit Agreement, should any payment,
distribution, security or other investment property or instrument or any
proceeds thereof be received by any Payee that is a Loan Party upon or with

 

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

 

respect to Payor Indebtedness owing to such Payee at any time when an Event of
Default has occurred and is continuing prior to such time as the Obligations
have been Paid in Full, such Payee shall receive and hold the same in trust, as
trustee, for the benefit of the Administrative Agent and the Secured Parties,
and shall forthwith upon written demand by the Administrative Agent deliver the
same to the Administrative Agent, for the benefit of the Secured Parties, in
precisely the form received (except for the endorsement or assignment of such
Payee where necessary or advisable in the Administrative Agent’s judgment), for
application to the Obligations and, until so delivered, the same shall be
segregated from the other assets of such Payee and held in trust by such Payee
as the property of the Administrative Agent, for the benefit of the Secured
Parties.  If such Payee fails to make any such endorsement or assignment to the
Administrative Agent, the Administrative Agent or any of its officers, employees
or representatives are hereby irrevocably authorized to make the same.  Each
Payee and Payor agrees that, until the Obligation have been Paid in Full, it
will not amend, modify or supplement this Promissory Note in a manner materially
adverse to the Secured Parties without the consent of the Administrative Agent.

 

Notwithstanding anything to the contrary contained herein, in any other Loan
Document or in any such promissory note or other instrument, this Promissory
Note replaces and supersedes any and all promissory notes or other instruments
which create or evidence any loans or advances made on or before the date hereof
by any Payee to any Payor.

 

This Note may be amended or replaced with the consent of the Administrative
Agent (not to be unreasonably withheld or delayed) to the extent necessary in
order to include any Permitted Credit Agreement Refinancing Indebtedness as
senior obligations (along with the Obligations) for purposes of this Note.

 

THIS PROMISSORY NOTE AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS
PROMISSORY NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW
OF THE STATE OF NEW YORK.

 

From time to time after the date hereof, additional Group Members may become
parties hereto by executing a counterpart signature page to this Promissory Note
(each additional Subsidiary, an “Additional Party”).  Upon delivery of such
counterpart signature page to the other signatories hereto, notice of which is
hereby waived by the other signatories hereto, each Additional Party shall be a
Payor and/or a Payee, as applicable, and shall be as fully a party hereto as if
such Additional Party were an original signatory hereof.  Each Payor expressly
agrees that its obligations arising hereunder shall not be affected or
diminished by the addition or release of any other Payor hereunder.  This
Promissory Note shall be fully effective as to any Payor that is or becomes a
party hereto regardless of whether any other Person becomes or fails to become
or ceases to be a Payor hereunder.

 

This Promissory Note may be executed in any number of counterparts and by
different parties hereto in separate counterparts (including by telecopy or
other electronic transmission), each of which when so executed shall be deemed
to be an original and all of which taken together shall constitute one and the
same agreement.

 

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

 

[Signature page follows]

 

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

 

IN WITNESS WHEREOF, each Payor and Payee has caused this Promissory Note to be
executed and delivered by its proper and duly authorized officer as of the date
set forth above.

 

 

 

PAYOR:

 

 

 

GNC CORPORATION

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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

 

 

PAYEES:

 

 

 

 

 

GENERAL NUTRITION CENTERS, INC.

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

GENERAL NUTRITION INVESTMENT COMPANY

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

GENERAL NUTRITION CORPORATION

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

GNC FUNDING, INC.

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

GNC TRANSPORTATION, LLC

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

LUCKYVITAMIN CORPORATION

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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

 

SCHEDULE A

 

TRANSACTIONS
ON
INTERCOMPANY SUBORDINATED DEMAND PROMISSORY NOTE

 

Date

 

Name of 
Payor

 

Name of 
Payee

 

Amount of 
Advance 
This Date

 

Amount of 
Principal 
Paid This 
Date

 

Outstanding 
Principal 
Balance 
from Payor 
to Payee 
This Date

 

Notation Made 
By

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

ENDORSEMENT

 

FOR VALUE RECEIVED, each of the undersigned does hereby sell, assign and
transfer to
                                                                                      
all of its right, title and interest in and to the Intercompany Subordinated
Demand Promissory Note, dated                   , 201    (as amended, restated,
supplemented or otherwise modified or replaced from time to time, the
“Promissory Note”), made by GNC Corporation (“Parent”) and General Nutrition
Centers, Inc. (the “Borrower”), and each other Subsidiary of the Borrower or any
other Person that becomes a party thereto, and payable to the undersigned.  This
endorsement is intended to be attached to the Promissory Note and, when so
attached, shall constitute an endorsement thereof.

 

Dated:

 

 

 

[Signature page follows]

 

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

 

 

GNC CORPORATION

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

GENERAL NUTRITION CENTERS, INC.

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

GENERAL NUTRITION CORPORATION

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

GENERAL NUTRITION INVESTMENT COMPANY

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

GNC FUNDING, INC.

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

GNC TRANSPORTATION, LLC

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

LUCKYVITAMIN CORPORATION

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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

 

Annex 1 to
Guarantee and Collateral Agreement

 

ASSUMPTION AGREEMENT, dated as of [                                  ], made by
                                            , a                               
(the “Additional Grantor”), in favor of JPMorgan Chase Bank, N.A., as
administrative agent (together with its successors in such capacity, the
“Administrative Agent”) for (i) the Lenders from time to time parties to the
Credit Agreement referred to below, and (ii) the other Secured Parties (as
defined in the Guarantee and Collateral Agreement (as hereinafter defined)). 
All capitalized terms not defined herein shall have the meaning ascribed to them
in such Credit Agreement.

 

W I T N E S S E T H:

 

WHEREAS, GNC Corporation, as Parent, General Nutrition Centers, Inc. (the
“Borrower”), the Lenders from time to time parties thereto, Goldman Sachs Bank
USA, as the Syndication Agent, Deutsche Bank Securities Inc. and Morgan Stanley
Senior Funding, Inc., as the Co-Documentation Agents and JPMorgan Chase Bank,
N.A., as the Administrative Agent, have entered into a Credit Agreement, dated
as of November 26, 2013 (as amended, restated, amended and restated,
supplemented or otherwise modified from time to time, the “Credit Agreement”);

 

WHEREAS, in connection with the Credit Agreement, the Borrower and certain of
its Affiliates (other than the Additional Grantor) have entered into the
Guarantee and Collateral Agreement, dated as of November 26, 2013 (as amended,
restated, supplemented or otherwise modified from time to time, the “Guarantee
and Collateral Agreement”) in favor of the Administrative Agent for the benefit
of the Secured Parties;

 

WHEREAS, the Credit Agreement requires the Additional Grantor to become a party
to the Guarantee and Collateral Agreement; and

 

WHEREAS, the Additional Grantor has agreed to execute and deliver this
Assumption Agreement in order to become a party to the Guarantee and Collateral
Agreement;

 

NOW, THEREFORE, IT IS AGREED:

 

1.                                      Guarantee and Collateral Agreement.  By
executing and delivering this Assumption Agreement, the Additional Grantor, as
provided in Section 8.14 of the Guarantee and Collateral Agreement, hereby
becomes a party to the Guarantee and Collateral Agreement as a Grantor and
Guarantor thereunder with the same force and effect as if originally named
therein as a Grantor and Guarantor and, without limiting the generality of the
foregoing, hereby expressly assumes all obligations and liabilities of a Grantor
and Guarantor thereunder.  The information set forth in Annex 1-A hereto is
hereby added to the information set forth in Schedules
[                          (1)] to the Guarantee and Collateral Agreement.  The
Additional Grantor hereby represents and warrants that each of the
representations and warranties contained in Section 4 of the Guarantee and
Collateral Agreement is true and correct in all material respects

 

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(1)  Refer to each Schedule which needs to be supplemented.

 

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on and as the date hereof (after giving effect to this Assumption Agreement) as
if made on and as of such date (except for representations and warranties
expressly stated to relate to a specific earlier date, in which case such
representations and warranties shall be true and correct in all material
respects as of such earlier date.

 

The Additional Grantor hereby confirms the grant of a security interest set
forth in Section 3 of the Guarantee and Collateral Agreement.

 

2.                                      GOVERNING LAW.  THIS ASSUMPTION
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE
STATE OF NEW YORK.

 

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

 

 

[ADDITIONAL GRANTOR]

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

2

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