Exhibit 10.2

 

FIRST LIEN GUARANTEE AND COLLATERAL AGREEMENT, dated as of April 30, 2010 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 (in such capacity, the “Administrative
Agent”) for the banks and other financial institutions or entities (the
“Lenders”) from time to time parties to the First Lien Credit Agreement, dated
as of April 30, 2010 (as amended, supplemented, restated or otherwise modified
from time to time, the “Credit Agreement”), among SIX FLAGS ENTERTAINMENT
CORPORATION (formerly known as SIX FLAGS, INC.), a Delaware corporation
(“Parent”), SIX FLAGS OPERATIONS INC., a Delaware corporation (“Holdings”), SIX
FLAGS THEME PARKS INC., a Delaware corporation (the “Borrower”), the
Administrative Agent and the other agents named therein.

 

W I T N E S S E T H:

 

WHEREAS, in connection with the confirmation and implementation of the Plan of
Reorganization, the Borrower has requested that the Lenders make loans and other
credit available to the Borrower under the Credit Agreement in order to enable
the reorganized Debtors to consummate the transactions contemplated by the Plan
of Reorganization, pay related fees and expenses and finance the working capital
needs and general corporate purposes of the Borrower;

 

WHEREAS, the Borrower and the other Grantors are engaged in related businesses,
and each Grantor will derive substantial direct and indirect benefit from the
making of the extensions of credit under 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 this Agreement to the
Administrative Agent for the ratable benefit of the Secured Parties;

 

NOW, THEREFORE, in consideration of the premises and to induce the
Administrative 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, and to induce the Qualified Counterparties to enter into the
Specified Cash Management Agreements and Specified Hedge Agreements, each
Grantor hereby agrees with the Administrative Agent, for the ratable benefit of
the Secured Parties, 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 are used
herein as defined in the New York UCC:  Accounts, Certificated Security, Chattel
Paper, Commercial Tort Claims, Documents, Equipment, General Intangibles,
Instruments, Inventory, Letter-of-Credit Rights and Supporting Obligations;
provided that none of the foregoing UCC terms shall be deemed to include
Excluded Assets.

 

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

 

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

 

“Borrower Obligations”:  the collective unpaid principal of and interest on
(including, without limitation, interest accruing at the then applicable rate
provided in the Credit Agreement after the maturity of the Loans and
Reimbursement Obligations and interest accruing at the then applicable rate
provided in the Credit Agreement after the filing of any petition in bankruptcy,
or the commencement of any insolvency, reorganization or like proceeding,
relating to the Borrower, whether or not a claim for post-filing or
post-petition interest is allowed in such proceeding) the Loans, the
Reimbursement Obligations and all other obligations and liabilities of the
Borrower to the Administrative Agent or to any Secured Party, whether direct or
indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, this
Agreement, any other Loan Document, the Letters of Credit, any Specified Hedge
Agreement, any Specified Cash Management Agreement or any other document made,
delivered or given by any Loan Party in connection herewith or therewith,
whether on account of principal, interest, reimbursement obligations, fees,
indemnities, costs, expenses (including, without limitation, all fees, charges
and disbursements of counsel to the Administrative Agent or to any Secured Party
that are required to be paid by the Borrower pursuant hereto) or otherwise.

 

“Collateral”:  as defined in Section 3.

 

“Copyrights”:  (i) all works of authorship and copyrights arising under the laws
of the United States, any group of countries, other country or any political
subdivision thereof, whether registered or unregistered and whether published or
unpublished, all registrations thereof, and all applications in connection
therewith, including, without limitation, all registrations and applications in
the United States Copyright Office, including, without limitation, any of the
foregoing listed in Schedule 5, and (ii) the right to obtain all renewals
thereof.

 

“Copyright Licenses”:  any written or oral agreement naming any Grantor as
licensor or licensee, granting any right under any Copyright, including, without
limitation, the grant of rights to manufacture, distribute, exploit and sell
materials derived from any Copyright, including, without limitation, any of the
foregoing listed in Schedule 5.

 

“Deposit Account”:  as defined in the Uniform Commercial Code of any applicable
jurisdiction and, in any event, including, without limitation, any demand, time,
savings, passbook or like account maintained with a depositary institution.

 

“Excluded Assets”:  the collective reference to (i) all Capital Stock owned by
any Grantor in (A) Flags Beverages, Inc., Fiesta Texas Hospitality LLC, Spring
Beverage Holding Corp. and other Subsidiaries, if any, which have no material
assets other than a liquor license, (B) HWP Development Holdings, LLC, HWP
Development LLC and any other entity formed pursuant to the Great Escape
Agreements and (C) Servicios de Restaurantes Especializados, S.A. De C.V. so
long as it owns no assets (other than a de minimus amount), (ii) any Trademark
License with Warner Bros. or its affiliates that expressly prohibits the
granting of a security

 

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interest therein (including but not limited to (A) those licenses contemplated
by the German WB Acquisition, and (B) the Amended and Restated License Agreement
#5854-WB/DC dated as of April 1, 1998 with the Borrower and the License
Agreement #8898-TOON dated January 1, 1998 between the Borrower and Warner Bros.
Consumer Products Division (Cartoon Network), as any of the foregoing may be
amended from time to time), except, in each case, to the extent that such term
in such license providing for such prohibition is ineffective under applicable
law, (iii) any other Trademark License that expressly prohibits the granting of
a security interest therein, except, in each case, to the extent that such term
in such license providing for such prohibition is ineffective under applicable
law, (iv) that portion of the Capital Stock of any Excluded Foreign Subsidiary
that is in excess of 65% of the total outstanding Capital Stock of such Excluded
Foreign Subsidiary, (v) the Capital Stock of a Subsidiary acquired after the
date hereof to the extent that Section 8.6(f) of the Credit Agreement does not
require the granting of a security interest therein, (vi) any Property of any
Grantor covered by a pledge or security interest under the New Time Warner
Facility or subject to a negative pledge thereunder, (vii) any Property owned by
any Grantor to the extent that creation of a security interest therein would be
prohibited by a Contractual Obligation binding on any Grantor that is the owner
of such Property, including pursuant to the New Time Warner Facility or the
Partnership Parks Agreements (provided that, with respect to Property acquired
after the date hereof, such Contractual Obligation existed at the time such
property was acquired and was not entered into in anticipation of such
acquisition); provided, however, that such Property shall no longer constitute
“Excluded Assets” immediately at such time as such security interest ceases to
be prohibited by a binding Contractual Obligation, (viii) any Property of any
Grantor to the extent that the Administrative Agent shall determine in its sole
discretion that the costs of obtaining a security interest in such Property is
excessive in relation to the value of the security to be afforded thereby and
(ix) United States intent-to-use Trademark applications to the extent that, and
solely during the period in which, the grant of a security interest therein
would impair the validity or enforceability of such intent-to-use trademark
applications under applicable federal law.

 

“Foreign Subsidiary”:  any Subsidiary organized under the laws of any
jurisdiction outside the United States of America.

 

“Foreign Subsidiary Voting Stock”:  the voting Capital Stock of any Foreign
Subsidiary.

 

“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,
or any Specified Hedge Agreements or Specified Cash Management Agreements 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 the Administrative Agent or to the Secured Parties that are required to be
paid by such Guarantor pursuant to the terms of this Agreement or any other Loan
Document to which such Guarantor is a party).

 

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

 

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

 

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“Intellectual Property”:  the collective reference to all rights, priorities and
privileges relating to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including, without
limitation, the Copyrights, the Copyright Licenses, the Patents, the Patent
Licenses, the Trademarks, and the Trademark Licenses, and all rights to sue at
law or in equity for any Infringement thereof, including the right to receive
all proceeds and damages therefrom; provided that Intellectual Property excludes
any Excluded Assets.

 

“Intercompany Note”:  any promissory note evidencing loans made by any Grantor
to Parent or any of its Subsidiaries.

 

“Intercreditor Agreement”:  the Intercreditor Agreement dated as of April 30,
2010 (as amended, restated, supplemented or otherwise modified from time to
time) among Parent, Holdings, the Borrower, the Subsidiary Guarantors, the First
Priority Representative (as defined therein) and the Second Priority
Representative (as defined therein).

 

“Investment Property”:  the collective reference to (i) all “investment
property” as such term is defined in Section 9-102(a)(49) of the New York UCC
(other than any Foreign Subsidiary Voting Stock excluded from the definition of
“Pledged Stock”) and (ii) whether or not constituting “investment property” as
so defined, all Pledged Notes and all Pledged Stock; provided that Investment
Property excludes any Excluded Assets.

 

“Issuers”:  the collective reference to each issuer of any Investment Property.

 

“Material Trademarks”: all Trademarks included in the Collateral that are
material to the business of the applicable Grantor.

 

“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.

 

“Patents”:  (i) all letters patent of the United States, any group of countries,
other country or any political subdivision thereof, all reissues and extensions
thereof, and (ii) all applications for letters patent of the United States or
any group of countries, other country or any political subdivision thereof, and
all reissues, divisions, extensions, continuations and continuations-in-part
thereof, similar legal protections related thereto, or rights to obtain the
foregoing, including, without limitation, any of the foregoing listed in
Schedule 5.

 

“Patent License”:  any written or oral agreement providing for the grant by or
to any Grantor of any right to make, have made, manufacture, use or sell
(directly or indirectly), offer to sell, import or dispose of any invention or
practice any method covered in whole or in part by a Patent, including, without
limitation, any of the foregoing listed in Schedule 5.

 

“Pledged Notes”:  all promissory notes listed on Schedule 2, all Intercompany
Notes at any time issued to any Grantor and all other promissory notes issued to
or held

 

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by any Grantor (other than promissory notes issued in connection with extensions
of trade credit by any Grantor in the ordinary course of business), excluding
any Excluded Assets.

 

“Pledged Securities”:  means any Instruments, Certificated Securities, Chattel
Paper and Investment Property.

 

“Pledged Stock”:  the shares of Capital Stock listed on Schedule 2, together
with any other shares, stock certificates, options, interests or rights of any
nature whatsoever in respect of the Capital Stock of any Person that may be
issued or granted to, or held by, any Grantor while this Agreement is in effect,
excluding any Excluded Assets; provided that in no event shall more than 65% of
the total outstanding Foreign Subsidiary Voting Stock of any Foreign Subsidiary
be required to be pledged hereunder.

 

“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 Investment Property, collections thereon or
distributions or payments with respect thereto.

 

“Receivable”:  any right to payment for goods sold or leased or for services
rendered, whether or not such right is evidenced by an Instrument or Chattel
Paper and whether or not it has been earned by performance (including, without
limitation, any Account).

 

“Registered Intellectual Property”:  all registrations and applications for
registration of Trademarks, Patents and Copyrights.

 

“Second Lien Guarantee and Collateral Agreement”: the Second Lien Guarantee and
Collateral Agreement, dated as of the date hereof, made by Parent, Holdings, the
Borrower and each Subsidiary Guarantor, in favor of the Second Priority
Representative (as defined in the Intercreditor Agreement) for the benefit of
the secured parties thereunder.

 

“Secured Parties”: the collective reference to the Lenders and each Qualified
Counterparty.

 

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

 

“Subsidiary Guarantor”:  each Grantor other than Parent, Holdings and the
Borrower.

 

“Trademarks”:  (i) all trademarks, trade names, brand names, corporate names,
company names, business names, fictitious business names, trade styles, trade
dress, domain names, service marks, logos and other source or business
identifiers, and all goodwill associated therewith or symbolized thereby, now
existing or hereafter adopted or acquired, all registrations thereof, and all
applications in connection therewith, whether in the United States Patent and
Trademark Office or in any similar office or agency of the United States, any
State thereof or any group of countries, other country or any political
subdivision thereof, or otherwise, and all common-law rights related thereto,
including,

 

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without limitation, any of the foregoing listed in Schedule 5, and (ii) the
right to obtain all renewals thereof.

 

“Trademark License”:  any written or oral agreement providing for the grant by
or to any Grantor of any right to use any Trademark, including, without
limitation, any of the foregoing listed in Schedule 5, but excluding the
Excluded Assets.

 

“Vehicles”:  all cars, trucks, trailers, construction and earth moving equipment
and other vehicles covered by a certificate of title law of any state 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 as amended
from time to time 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.

 

(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.

 

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 ratable 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 Security Documents and the maximum
amount which may be secured by the Liens granted with respect to the Collateral
hereunder and the Collateral under the other Security Documents, in each case,
shall in no event exceed the amount which can be guaranteed by such Guarantor,
or secured by assets of 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 the Borrower
Obligations may at any time and from time to time exceed the amount of the
liability of such Guarantor hereunder without impairing the guarantee contained
in this Section 2 or affecting the rights and remedies of the Administrative
Agent or any Secured Party hereunder.

 

(d)                                 The guarantee contained in this Section 2
shall remain in full force and effect until all of the Borrower Obligations and
the obligations of each Guarantor under the guarantee contained in this
Section 2 shall have been satisfied by payment in full, no Letter of Credit
shall be outstanding and the Commitments shall be terminated, notwithstanding
that from time to time the Borrower may be free from any Obligations.

 

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(e)                                  No payment made by the Borrower, any of the
Guarantors, any other guarantor or any other Person or received or collected by
the Administrative Agent or 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 Borrower
Obligations), remain liable for the Borrower Obligations up to the maximum
liability of such Guarantor hereunder until the Borrower Obligations are paid in
full, no Letter of Credit shall be outstanding and the Commitments are
terminated.

 

2.2                                 Right of Contribution.  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 2.3.  The
provisions of this Section 2.2 shall in no respect limit the obligations and
liabilities of any Subsidiary Guarantor to the Administrative Agent and the
Secured Parties, and each Subsidiary Guarantor shall remain liable to the
Administrative Agent and the Secured Parties for the full amount guaranteed by
such Subsidiary Guarantor hereunder.

 

2.3                                 No Subrogation.  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 all amounts owing to the Administrative Agent and the Secured
Parties by the Borrower on account of the Borrower Obligations are paid in full,
no Letter of Credit shall be outstanding and the Commitments are terminated.  If
any amount shall be paid to any Guarantor on account of such subrogation rights
at any time when all of the Borrower Obligations shall not have been paid in
full, 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, in
such order as the Administrative Agent may determine.

 

2.4                                 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 demand for payment
of any of the Borrower Obligations made by the Administrative Agent or any
Secured Party may be rescinded by the Administrative Agent or 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

 

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of offset with respect thereto, may, from time to time, in whole or in part, be
renewed, extended, amended, modified, accelerated, compromised, waived,
surrendered or released by the Administrative Agent or 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 Required Lenders 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 the Administrative Agent or any Secured Party for the payment of
the Borrower Obligations may be sold, exchanged, waived, surrendered or
released.  Neither the Administrative Agent nor any 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.

 

2.5                                 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
the Administrative Agent or 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
Administrative Agent 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 to the extent permitted by law.  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 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 the Administrative Agent or any Secured Party, (b) any
defense, set-off or counterclaim (other than a defense of payment or
performance) which may at any time be available to or be asserted by the
Borrower or any other Person against the Administrative Agent or 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.  When making any demand
hereunder or otherwise pursuing its rights and remedies hereunder against any
Guarantor, the Administrative Agent or 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 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 the Administrative
Agent or any Secured Party to make any such demand, to pursue such other rights
or remedies or to collect any payments from the Borrower, any 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, any Guarantor
or any other Person 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 the Administrative

 

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Agent or any Secured Party against any Guarantor.  For the purposes hereof
“demand” shall include the commencement and continuance of any legal
proceedings.

 

2.6                                 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 the
Administrative Agent or 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.

 

2.7                                 Payments.  Each Guarantor hereby guarantees
that payments hereunder will be paid to the Administrative Agent without set-off
or counterclaim, in immediately available funds in the currency in which the
relevant Obligation is denominated, at the applicable Payment Office.

 

SECTION 3.  GRANT OF SECURITY INTEREST

 

Each Grantor hereby grants to the Administrative Agent, for the ratable benefit
of the Secured Parties, a security interest in all of the following property 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:

 

(a)                                  all Accounts;

 

(b)                                 all Chattel Paper;

 

(c)                                  all Deposit Accounts;

 

(d)                                 all Documents;

 

(e)                                  all Equipment;

 

(f)                                    all Fixtures;

 

(g)                                 all General Intangibles;

 

(h)                                 all Instruments;

 

(i)                                     all Intellectual Property;

 

(j)                                     all Inventory;

 

(k)                                  all Investment Property;

 

(l)                                     all other personal property not
otherwise described above;

 

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(m)                               all books and records pertaining to the
Collateral; and

 

(n)                                 to the extent not otherwise included, all
Proceeds, Supporting Obligations and products of any and all of the foregoing
and all collateral security and guarantees given by any Person with respect to
any of the foregoing.

 

Notwithstanding the foregoing, (i) the Collateral shall not include the Excluded
Assets and (ii) the Partnership Parks Entities and their Property and any other
Property of Parent and its Subsidiaries subject to the Partnership Parks
Agreements shall be expressly excluded from, and shall not be subject to, any
provisions of this Agreement so long as the creation of a security interest
under, or the execution of, this Agreement is prohibited by a Contractual
Obligation binding on the Partnership Park Entities or, with respect to any
other Property of Parent and its Subsidiaries, is prohibited by the Partnership
Parks Agreements.

 

SECTION 4.    REPRESENTATIONS AND WARRANTIES

 

To induce the Administrative 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, and to induce the Qualified Counterparties to
enter into the Specified Cash Management Agreements and Specified Hedge
Agreements, as applicable, each Grantor hereby represents and warrants to the
Administrative Agent and each Secured Party that:

 

4.1                                 Investment Property.  (a)  The shares of
Pledged Stock pledged by such Grantor hereunder constitute all the issued and
outstanding shares of all classes of the Capital Stock of each Issuer owned by
such Grantor or, in the case of Foreign Subsidiary Voting Stock, 65% of the
outstanding Foreign Subsidiary Voting Stock of each relevant Issuer.

 

(b)                                 All the shares of the Pledged Stock issued
by each Issuer (other than any Issuer that is a Foreign Subsidiary, a
partnership or a limited liability company) have been duly and validly issued
and are fully paid and nonassessable.

 

(c)                                  Each of the Pledged Notes, to the knowledge
of the Grantors, constitutes the legal, valid and binding obligation of the
obligor with respect thereto, enforceable in accordance with its terms, subject
to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors’ rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.

 

(d)                                 Such Grantor is the record and beneficial
owner of, and has good and marketable title to, the Investment Property pledged
by it hereunder, free of any and all Liens or options in favor of, or claims of,
any other Person, except the security interest created by the Second Lien
Guarantee and Collateral Agreement and this Agreement.

 

4.2                                 Intellectual Property.  (a) Schedule 5 lists
all (i) Registered Intellectual Property owned by such Grantor in its own name
on the date hereof and (ii) all material Registered Intellectual Property
exclusively licensed by such Grantor as of the date hereof, noting in each case
the relevant registration, application or serial number, the jurisdiction of
registration or application, and, in the case of (ii), the title of the license,
the counterparty to such

 

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license and the date of such license, provided that with respect to the
foregoing clause (ii), the applicable Registered Intellectual Property is
identified in the applicable license.

 

(b)                                 Except as set forth in Schedule 5 and except
for joint marketing and sponsorship agreements entered into by such Grantor in
the ordinary course of its business, on the date hereof, none of the
Intellectual Property is the subject of any licensing or franchise agreement
pursuant to which such Grantor is the licensor or franchisor.

 

(c)                                  Such Grantor owns, or is licensed to use,
all Intellectual Property material to the conduct of its business as currently
conducted, free and clear of all Liens other than Permitted Liens, and takes
reasonable actions to protect, preserve and maintain such Intellectual Property
except as permitted by Sections 9.5(c)(i) and (c)(xvi) of the Credit Agreement. 
Except as could not reasonably be expected to have a Material Adverse Effect,
(i) all such Intellectual Property is valid and enforceable and (ii) all
Registered Intellectual Property has not expired or been abandoned except as
permitted by Sections 9.5(c)(i) and (c)(xvi) of the Credit Agreement.   No
claim, action or proceeding is pending by any Person or, to the knowledge of
such Grantor, threatened, or imminent, on the date hereof, and no holding,
decision or judgment has been rendered by any Governmental Authority or
arbitrator, which may limit, cancel or challenge the validity, enforceability,
ownership or use of, any material Intellectual Property in any material respect,
except for claims, actions, proceedings, holdings, decisions or judgments which,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.  To the knowledge of such Grantor, (i) the operation of
the business of such Grantor does not Infringe the Intellectual Property rights
of any Person, and, (ii) no Person is Infringing any Intellectual Property owned
by such Grantor to an extent which could reasonably be expected to have a
Material Adverse Effect.

 

(d)                                 Commercial Tort Claims.  On the date hereof,
no Grantor has rights in any Commercial Tort Claim with potential value in
excess of $100,000.

 

4.3                                 Additional Representations and Warranties.

 

(a)                                  On the date of this Agreement, such
Grantor’s jurisdiction of organization, identification number from the
jurisdiction of organization (if any) and the location of such Grantor’s chief
executive office or sole place of business or principal residence, as the case
may be, are specified on Schedule 4.  Such Grantor has furnished to the
Administrative Agent a certified charter, certificate of incorporation or other
organization document and good standing certificate as of a date which is recent
to the date hereof.

 

(b)                                 Each Grantor has good and valid rights in
and title to the Collateral with respect to which it has purported to grant a
security interest hereunder and has full power and authority to grant to the
Administrative Agent a security interest in such Collateral pursuant hereto and
to execute, deliver and perform its obligations in accordance with the terms of
this Agreement, without the consent or approval of any other Person other than
any consent or approval that has been obtained and is in full force and effect.

 

(c)                                  The UCC financing statements (including
fixture filings, as applicable) or other appropriate filings, recordings or
registrations for filing in each governmental, municipal or other office
specified in Schedule 3 hereto, and with respect to Collateral consisting of
registered and applied for United States Patents, Trademarks, or Copyrights, to
the extent required by

 

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applicable Federal law, filings made at the United States Patent and Trademark
Office and the United States Copyright Office, as applicable, are all the
filings, recordings and registrations that are necessary to establish a legal,
valid and perfected security interest in favor of the Administrative Agent (for
the benefit of the Secured Parties) in respect of all Collateral in which a
security interest may be perfected by filing, recording or registration in the
United States (or any political subdivision thereof) and its territories and
possessions, and no further or subsequent filing, refiling, recording,
rerecording, registration or reregistration is necessary in any such
jurisdiction, except as provided under applicable law with respect to the filing
of continuation statements.

 

(d)                                 The security interest granted to the
Administrative Agent constitutes (i) a legal and valid security interest in all
the Collateral securing the payment and performance of the Obligations and
(ii) subject to the filings described in Section 4.4(c), a perfected security
interest in all Collateral in which a security interest may be perfected by
filing, recording or registering a financing statement or analogous document in
the United States (or any political subdivision thereof) and its territories and
possessions pursuant to the Uniform Commercial Code in the relevant
jurisdiction. The security interest granted to the Administrative Agent is and
shall be prior to any other Lien on any of the Collateral, other than Liens
expressly permitted under the Credit Agreement.

 

(e)                                  The Collateral is owned by the Grantors
free and clear of any Lien, except for Permitted Liens under the Credit
Agreement.  None of the Grantors has filed or consented to the filing of (i) any
financing statement or analogous document under the New York UCC or any other
applicable laws covering any Collateral or (ii) any assignment in which any
Grantor assigns any Collateral or any security agreement or similar instrument
covering any Collateral with any foreign governmental, municipal or other
office, which financing statement or analogous document, assignment, security
agreement or similar instrument is still in effect, except, in each case, for
Liens expressly permitted under the Credit Agreement, or those which are for
notice purposes only.

 

SECTION 5.  COVENANTS

 

Each Grantor covenants and agrees with the Administrative Agent and the Secured
Parties that, from and after the date of this Agreement until the Obligations
shall have been paid in full (other than Obligations under Specified Hedge
Agreements and Specified Cash Management Agreements that are not yet due and
payable, and contingent indemnification obligations not yet accrued and
payable), no Letter of Credit shall be outstanding and the Commitments shall
have terminated:

 

5.1                                 Delivery of Pledged Securities.

 

(a)                                  Each Grantor agrees promptly to deliver or
cause to be delivered to the Administrative Agent, for the benefit of the
Secured Parties, any and all Pledged Securities (other than any uncertificated
Capital Stock, but only for so long as such Capital Stock remains
uncertificated) to the extent such Pledged Securities, in the case of promissory
notes or other instruments evidencing Indebtedness, are required to be delivered
pursuant to paragraph (b) of this Section 5.1 (it being understood that, with
respect to Reino Aventura, S.A. De C.V. and Ventas Y Servicios Al Consumidor,
S.A. De C.V, such Pledged Securities shall be delivered

 

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within 30 days following the Closing Date (or such later date as consented to by
the Administrative Agent in its reasonable discretion)).

 

(b)                                 Each Grantor will cause (i) any Indebtedness
for borrowed money (other than intercompany loans referred to in clause
(ii) below) having an aggregate principal amount in excess of $1,000,000 owed to
such Grantor by any Person and (ii) any intercompany loans made by such Grantor
to any Person that is not a Loan Party to be evidenced by a duly executed
promissory note (or pursuant to a global note) that is pledged and delivered to
the Administrative Agent, for the benefit of the Secured Parties, pursuant to
the terms hereof.

 

(c)                                  Upon delivery to the Administrative Agent,
(i) any Pledged Securities shall be accompanied by stock powers duly executed in
blank or other instruments of transfer reasonably satisfactory to the
Administrative Agent and by such other instruments and documents as the
Administrative Agent may reasonably request and (ii) all other property
comprising part of the Pledged Securities shall be accompanied by proper
instruments of assignment duly executed by the applicable Grantor and such other
instruments or documents as the Administrative Agent may reasonably request. 
Each delivery of Pledged Securities shall be accompanied by a schedule
describing such Pledged Securities, which schedule shall be attached hereto as
Schedule 2 and made a part hereof; provided that failure to attach any such
schedule hereto shall not affect the validity of such pledge of such Pledged
Securities.  Each schedule so delivered shall supplement any prior schedules so
delivered.

 

(d)                                 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 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, (i) filing any financing or
continuation statements under the Uniform Commercial Code (or other similar
laws) in effect in any jurisdiction with respect to the security interests
created hereby and (ii) in the case of Investment Property, Deposit Accounts,
Letter-of-Credit Rights and any other relevant Collateral, taking any actions
necessary to enable the Administrative Agent to obtain “control” (within the
meaning of the applicable Uniform Commercial Code) with respect thereto.

 

(e)                                  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 Investment Property issued by it and will comply with
such terms insofar as such terms are applicable to it, (ii) it will notify the
Administrative Agent promptly in writing of the occurrence of any of the events
described in Section 5.4(b) with respect to the Investment Property issued by it
and (iii) the terms of Sections 6.2(d) and 6.7 shall apply to it, mutatis
mutandis, with respect to all actions that may be required of it pursuant to
Section 6.2(d) or 6.7 with respect to the Investment Property issued by it.

 

5.2                                 Intellectual Property.  (a) Except as
permitted by Sections 9.5(c)(i) and (c)(xvi) of the Credit Agreement, such
Grantor (either itself or through licensees) will (i) continue to use each
Material Trademark in order to maintain such Material Trademark in full force
free from any claim of abandonment for non-use, (ii) maintain in all material
respects as in the past the quality of all products and services offered under
any Material Trademark, (iii) use each Material Trademark with all appropriate
notices of registration and all other notices and legends required by applicable
Requirements of Law, (iv) not adopt or use any new mark, or any

 

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mark which is confusingly similar or a colorable imitation of a Trademark
included in the Collateral 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 (v) not (and will use commercially
reasonable efforts to prohibit any licensee or sublicensee thereof to) do any
act or knowingly omit to do any act whereby a Material Trademark could
reasonably be expected to become invalidated or diluted in any way, except, in
each case, as could not reasonably be expected to have a Material Adverse
Effect.

 

(b)                                 Except as permitted by Sections
9.5(c)(i) and (c)(xvi) of the Credit Agreement, such Grantor will not do any
act, or omit to do any act (and will use commercially reasonable efforts to
ensure that any licensee or sublicensee does not do any act or omit to do any
act) whereby any material Patent included in the Collateral is abandoned or
dedicated to the public, or allowed to prematurely lapse.

 

(c)                                  Such Grantor will not do any act or
knowingly omit to do any act (and will use commercially reasonable efforts to
ensure that any licensee or sublicensee does not do any act or omit to do any
act) whereby any material portion of the Copyrights included in the Collateral
could reasonably be expected to become invalidated or otherwise materially
impaired.  Such Grantor will not do any act (and will use commercially
reasonable efforts to ensure that any licensee or sublicensee does not do any
act) whereby a material portion of any Copyright included in the Collateral
falls into the public domain.

 

(d)                                 Such Grantor will not (and will use
commercially reasonable efforts to ensure that any licensee or sublicense does
not) knowingly Infringe in any material respect upon the intellectual property
rights of any other Person.

 

(e)                                  Such Grantor will notify the Administrative
Agent in the next Compliance Certificate required to be delivered by it pursuant
to Section 8.1(f) of the Credit Agreement if it knows, or has reason to know,
that any material Registered Intellectual Property may 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, the United States Copyright Office or any similar office or
agency, or any court or tribunal in any country) regarding such Grantor’s rights
in, or the validity, enforceability, ownership or use of, any material
Intellectual Property, including, without limitation, such Grantor’s right to
register or maintain same.

 

(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
Registered Intellectual Property with the United States Copyright Office or the
United States Patent and Trademark Office, or any similar office or agency in
any group of countries, other country or any political subdivision thereof, such
Grantor shall report such filing to the Administrative Agent on the first
Compliance Certificate delivered pursuant to Section 8.1(f) of the Credit
Agreement after such acquisition, licensing, or filing.  Upon request of the
Administrative Agent, 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 Administrative Agent’s and the
Secured Parties security interest in any Registered Intellectual Property which
is not an Excluded Asset.

 

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(g)                                 Such Grantor will take such actions as it
reasonably deems appropriate under the circumstances, to maintain and pursue
each application (and to obtain the relevant registration) and to maintain each
registration of all Registered Intellectual Property, including, without
limitation, filing of applications for renewal, affidavits of use and affidavits
of incontestability.

 

(h)                                 In the event that any material Intellectual
Property is Infringed by a third party, such Grantor shall (i) take such actions
as such Grantor shall reasonably deem appropriate under the circumstances to
protect such Intellectual Property and (ii) if such Intellectual Property is of
material economic value to the Grantors as a whole, promptly notify the
Administrative Agent after it learns thereof and, after taking reasonable and
customary measures to stop such Infringement and where appropriate in such
Grantor’s reasonable business judgment, sue for Infringement, seek injunctive
relief and to recover any and all damages for such Infringement.

 

5.3                                 Additional Covenants.

 

(a)                                  The Borrower agrees, on its own behalf and
on behalf of each Grantor, to notify the Administrative Agent in writing of any
change (i) in legal name of any Grantor, (ii) in the identity or type of
organization or corporate structure of any Grantor, or (iii) in the jurisdiction
of organization of any Grantor, within 15 days of any such change.

 

(b)                                 Each Grantor shall, at its own expense, take
any and all commercially reasonable actions necessary to defend title to the
Collateral against all Persons and to defend the security interest of the
Administrative Agent in the Collateral and the priority thereof against any Lien
not expressly permitted by the Credit Agreement.

 

(c)                                  The Borrower agrees, on its own behalf and
on behalf of each other Grantor, at its own expense, to execute, acknowledge,
deliver and cause to be duly filed all such further instruments and documents
and take all such actions as the Administrative Agent may from time to time
reasonably request to better assure, preserve, protect and perfect its security
interest and the rights and remedies created hereby, including the payment of
any fees and taxes required in connection with the execution and delivery of
this Agreement, the granting to the Administrative Agent of a security interest
and the filing of any financing statements (including fixture filings) or other
documents in connection herewith or therewith.  If any amount payable under or
in connection with any of the Collateral that is in excess of $1,000,000 shall
be or become evidenced by any promissory note or other instrument, such note or
instrument shall be promptly pledged and delivered to the Administrative Agent,
for the benefit of the Secured Parties, duly endorsed in a manner reasonably
satisfactory to the Administrative Agent.

 

(d)                                 At its option, the Administrative Agent may
discharge past due taxes, assessments, charges, fees, Liens, security interests
or other encumbrances at any time levied or placed on the Collateral and not
permitted under the Credit Agreement, and may pay for the maintenance and
preservation of the Collateral to the extent any Grantor fails to do so as
required by the Credit Agreement or this Agreement and within a reasonable
period of time after the Administrative Agent has requested that it do so, and
each Grantor jointly and severally agrees to reimburse the Administrative Agent
within 10 days after demand for any payment made or any reasonable expense
incurred by the Administrative Agent pursuant to the foregoing authorization. 
Nothing in this paragraph shall be interpreted as excusing any Grantor from the
performance of, or imposing any obligation on the Administrative Agent or any
Secured Party to

 

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cure or perform, any covenants or other promises of any Grantor with respect to
taxes, assessments, charges, fees, Liens, security interests or other
encumbrances and maintenance as set forth herein, in the other Loan Documents.

 

(e)                                  If at any time any Grantor shall take a
security interest in any property of any Person who is or who may become
obligated to any Grantor under, with respect to or on account of an Account (an
“Account Debtor”), or any other Person, the value of which is in excess of
$1,000,000, to secure payment and performance of an Account, such Grantor shall
promptly assign such security interest to the Administrative Agent for the
benefit of the Secured Parties.  Such assignment need not be filed of public
record unless necessary to continue the perfected status of the security
interest against creditors of and transferees from the Account Debtor or other
Person granting the security interest.

 

(f)                                    Each Grantor (rather than the
Administrative Agent or any Secured Party) shall remain liable (as between
itself and any relevant counterparty) to observe and perform all the material
conditions and obligations to be observed and performed by it under each
contract, agreement or instrument relating to the Collateral, all in accordance
with the terms and conditions thereof, and each Grantor jointly and severally
agrees to indemnify and hold harmless the Administrative Agent and the Secured
Parties from and against any and all liability for such performance; provided,
that no Grantor shall have any obligation hereunder to the Administrative Agent
or any Secured Party with respect to any such liabilities to the extent such
liabilities are found by a final and non-appealable decision of a court of
competent jurisdiction to have resulted from the gross negligence or willful
misconduct of the Administrative Agent or any Secured Party or of any director,
officer, or employee of the Administrative Agent or any Secured Party.

 

(g)                                 If any Grantor shall at any time hold or
acquire a Commercial Tort Claim with a value in excess of $1,000,000, such
Grantor shall promptly notify the Administrative Agent in writing signed by such
Grantor of the brief details thereof and grant to the Administrative Agent a
security interest therein and in the proceeds thereof, all upon the terms of
this Agreement pursuant to a document in form and substance reasonably
satisfactory to the Administrative Agent.

 

(h)                                 The aggregate book value of all Vehicles
owned by all such Grantors will not exceed $10,000,000 or such higher book value
as shall be reasonably satisfactory to the Administrative Agent.

 

5.4                                 Other Actions.  In order to further ensure
the attachment, perfection and priority of, and the ability of the
Administrative Agent to enforce its security interest, each Grantor agrees, in
each case at such Grantor’s own expense, to take the following actions with
respect to the following Collateral:

 

(a)                                  Instruments.  If any Grantor shall at any
time hold or acquire any Instruments constituting Collateral and evidencing an
amount in excess of $1,000,000, such Grantor shall forthwith endorse, assign and
deliver the same to the Administrative Agent for the benefit of the Secured
Parties, accompanied by such instruments of transfer or assignment duly executed
in blank as the Administrative Agent may from time to time reasonably request.

 

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(b)                                 Investment Property.  If any Grantor shall
at any time hold or acquire any certificated Capital Stock, such Grantor shall
forthwith endorse, assign and deliver the same to the Administrative Agent for
the benefit of the Secured Parties, accompanied by such instruments of transfer
or assignment duly executed in blank as the Administrative Agent may from time
to time reasonably request.  If any Capital Stock now or hereafter acquired by
any Grantor are uncertificated and are issued to such Grantor or its nominee
directly by the issuer thereof, such Grantor shall promptly notify the
Administrative Agent thereof and, at the Administrative Agent’s reasonable
request and option, pursuant to an agreement in form and substance reasonably
satisfactory to the Administrative Agent, either (i) cause the Issuer to agree
to comply with instructions from the Administrative Agent as to such securities,
without further consent of any Grantor or such nominee, or (ii) arrange for the
Administrative Agent to become the registered owner of the securities.  If any
Capital Stock, whether certificated or uncertificated, or other Investment
Property are held by any Grantor or its nominee through a securities
intermediary or commodity intermediary, such Grantor shall promptly notify the
Administrative Agent thereof and at the Administrative Agent’s request and
option, pursuant to an agreement in form and substance reasonably satisfactory
to the Administrative Agent shall either (i) cause such securities intermediary
or (as the case may be) commodity intermediary to agree to comply with
entitlement orders or other instructions from the Administrative Agent to such
securities intermediary as to such security entitlements, or (as the case may
be) to apply any value distributed on account of any commodity contract as
directed by the Administrative Agent to such commodity intermediary, in each
case without further consent of any Grantor or such nominee, or (ii) in the case
of financial assets or other Investment Property held through a securities
intermediary, arrange for the Administrative Agent to become the entitlement
holder with respect to such Investment Property, with the Grantor being
permitted, only with the consent of the Administrative Agent, to exercise rights
to withdraw or otherwise deal with such Investment Property.  The Administrative
Agent agrees with each of the Grantors that the Administrative Agent shall not
give any such entitlement orders or instructions or directions to any such
Issuer, securities intermediary or commodity intermediary, and shall not
withhold its consent to the exercise of any withdrawal or dealing rights by any
Grantor, unless an Event of Default has occurred and is continuing. The
provisions of this paragraph shall not apply to any financial assets credited to
a securities account for which the Administrative Agent is the securities
intermediary.

 

SECTION 6.  REMEDIAL PROVISIONS

 

6.1                                 Registration in Nominee Name; Denominations.
If an Event of Default shall occur and be continuing, (a) the Administrative
Agent, on behalf of the Secured Parties, shall have the right (in its sole and
absolute discretion) to hold the Pledged Securities in its own name as pledgee,
the name of its nominee (as pledgee or as sub-agent) or the name of the
applicable Grantor, endorsed or assigned in blank or in favor of the
Administrative Agent, and each Grantor will promptly give to the Administrative
Agent copies of any notices or other communications received by it with respect
to Pledged Securities registered in the name of such Grantor and (b) the
Administrative Agent shall have the right to exchange the certificates
representing Pledged Securities for certificates of smaller or larger
denominations for any purpose consistent with this Agreement.

 

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6.2                                 Voting Rights; Dividends and Interest.

 

(a)                                  Unless and until an Event of Default shall
have occurred and be continuing and the Administrative Agent shall have notified
the Borrower that the rights of the Grantors under this Section 6.2 are being
suspended:

 

(i)                                     Each Grantor shall be entitled to
exercise any and all voting and/or other consensual rights and powers inuring to
an owner of Pledged Securities or any part thereof for any purpose consistent
with the terms of this Agreement, the Credit Agreement and the other Loan
Documents; provided that such rights and powers shall not be exercised in any
manner that could materially and adversely affect the rights inuring to a holder
of any Pledged Securities or the rights and remedies of any of the
Administrative Agent or the other Secured Parties under this Agreement, the
Credit Agreement or any other Loan Document or the ability of the Secured
Parties to exercise the same.

 

(ii)                                  Each Grantor shall be entitled to receive
and retain any and all dividends, interest, principal and other distributions
paid on or distributed in respect of the Pledged Securities to the extent and
only to the extent that such dividends, interest, principal and other
distributions are permitted by, and otherwise paid or distributed in accordance
with, the terms and conditions of the Credit Agreement, the other Loan Documents
and applicable Laws; provided that any noncash dividends, interest, principal or
other distributions, whether resulting from a subdivision, combination or
reclassification of the outstanding equity interests 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 be and become part of the Collateral, and, if received by any
Grantor, shall not be commingled by such Grantor with any of its other funds or
property but shall be held separate and apart therefrom, shall be held in trust
for the benefit of the Administrative Agent and the Secured Parties 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).

 

(b)                                 Upon the occurrence and during the
continuance of an Event of Default, after the Administrative Agent shall have
notified the Borrower of the suspension of the rights of the Grantors under
paragraph (a)(ii) of this Section 6.2, then all rights of any Grantor to
dividends, interest, principal or other distributions that such Grantor is
authorized to receive pursuant to paragraph (a)(ii) of this Section 6.2 shall
cease, and all such rights shall thereupon become vested in the Administrative
Agent, which shall have the sole and exclusive right and authority to receive
and retain such dividends, interest, principal or other distributions.  All
dividends, interest, principal or other distributions received by any Grantor
contrary to the provisions of this Section 6.2 shall be (i) held in trust for
the benefit of the Administrative Agent, (ii) segregated from other property or
funds of such Grantor and (iii) forthwith delivered to the Administrative Agent
in the same form as so received (with any necessary endorsement reasonably
requested by the Administrative Agent).  Any and all money and other property
paid over to or received by the Administrative Agent pursuant to the provisions
of this paragraph (b) shall be retained by the Administrative Agent in an
account to be established by the Administrative Agent upon receipt of such money
or other property and shall be applied in accordance with the provisions of
Section 6.4.  After all Events of Default have been cured or waived, the
Administrative Agent shall promptly repay to each Grantor (without interest) all
dividends, interest, principal or other distributions that such Grantor would
otherwise be

 

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permitted to retain pursuant to the terms of paragraph (a)(ii) of this
Section 6.2 and that remain in such account.

 

(c)                                  Upon the occurrence and during the
continuance of an Event of Default, after the Administrative Agent shall have
notified the Borrower of the suspension of the rights of the Grantors under
paragraph (a)(i) of this Section 6.2, then all rights of any Grantor to exercise
the voting and consensual rights and powers it is entitled to exercise pursuant
to paragraph (a)(i) of this Section 6.2 shall cease, and all such rights shall
thereupon become vested in the Administrative Agent, which shall have the sole
and exclusive right and authority to exercise such voting and consensual rights
and powers; provided that, unless otherwise directed by the Required Lenders,
the Administrative Agent shall have the right from time to time following and
during the continuance of an Event of Default to permit the Grantors to exercise
such rights.  After all Events of Default have been cured or waived, each
Grantor shall have the exclusive right to exercise the voting and/or consensual
rights and powers that such Grantor would otherwise be entitled to exercise
pursuant to the terms of paragraph (a)(i) of this Section 6.2.

 

(d)                                 Each Grantor hereby authorizes and instructs
each Issuer of any Investment Property 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) pay any non-cash
dividends or other non-cash payments with respect to the Investment Property
directly to the Administrative Agent and, after such Issuer receives notice from
the Administrative Agent that an Event of Default has occurred, pay any cash
dividends or other payments with respect to the Investment Property directly to
the Administrative Agent.

 

6.3                                 Additional Remedies upon Default.

 

(a)                                  Upon the occurrence and during the
continuance of an Event of Default, it is agreed that the Administrative Agent
shall have the right to exercise any and all rights afforded to a Secured Party
with respect to the Obligations under the Uniform Commercial Code or other
applicable law and also may (i) require each Grantor to, and each Grantor agrees
that it will at its expense and upon request of the Administrative Agent
forthwith, assemble all or part of the Collateral as directed by the
Administrative Agent and make it available to the Administrative Agent at a
place and time to be designated by the Administrative Agent; (ii) occupy any
premises owned or, to the extent lawful and permitted, leased by any of the
Grantors where the Collateral or any part thereof is assembled or located for a
reasonable period in order to effectuate its rights and remedies hereunder or
under law, without obligation to such Grantor in respect of such occupation;
(iii) exercise any and all rights and remedies of any of the Grantors under or
in connection with the Collateral, or otherwise in respect of the Collateral,
provided that, with respect to any Collateral consisting of Pledged Stock of any
Issuer that is not a Wholly Owned Subsidiary, such exercise shall be subject to
any limitations or prohibitions of any Contractual Obligations among the holders
of such Issuer’s Capital Stock; and (iv) subject to the mandatory requirements
of applicable law, 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 sell or otherwise dispose of, or acquire by credit
bid on behalf of the Secured Parties, all or any part of the Collateral securing
the Obligations at a public or private sale or at any broker’s board or on any
securities exchange, for cash, upon credit or for future delivery as the

 

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Administrative Agent shall deem appropriate.  The Administrative Agent shall be
authorized at any such sale of securities (if it deems it advisable to do so) to
restrict the prospective bidders or purchasers to Persons who will represent and
agree that they are purchasing the Collateral for their own account for
investment and not with a view to the distribution or sale thereof, and upon
consummation of any such sale the Administrative Agent shall have the right to
assign, transfer and deliver to the purchaser or purchasers thereof the
Collateral so sold.  Each such purchaser at any sale of Collateral shall hold
the property sold absolutely, free from any claim or right on the part of any
Grantor, and each Grantor hereby waives (to the extent not prohibited by law)
all rights of redemption, stay and appraisal which such Grantor now has or may
at any time in the future have under any rule of law or statute now existing or
hereafter enacted.

 

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

 

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competent jurisdiction or pursuant to a proceeding by a court appointed
receiver.  Any sale pursuant to the provisions of this Section 6.3 shall be
deemed to conform to the commercially reasonable standards as provided in
Section 9-610(b) of the New York UCC or its equivalent in other jurisdictions.

 

6.4                                 Application of Proceeds.  Subject to the
terms of the Intercreditor Agreement, at such intervals as may be agreed upon by
the Borrower and the Administrative Agent, or, if an Event of Default shall have
occurred and be continuing, at any time at the Administrative Agent’s election,
the Administrative Agent may apply all or any part of Proceeds of any collection
or sale of Collateral, including any Collateral consisting of cash, and any
proceeds of the guarantee set forth in Section 2 in payment of the Obligations
in the following order:

 

First, to pay incurred and unpaid fees and expenses of the Administrative Agent
under the Loan Documents;

 

Second, to the Administrative Agent, for application by it towards payment of
amounts then due and owing and remaining unpaid in respect of the Obligations,
pro rata among the Secured Parties according to the amounts of the Obligations
then due and owing and remaining unpaid to the Secured Parties;

 

Third, to the Administrative Agent, for application by it towards prepayment of
the Obligations (other than obligations in respect of Specified Hedge Agreements
and Specified Cash Management Agreements), pro rata among the Lenders according
to the amounts of the Obligations then held by the Lenders, with any such
prepayment of Loans being applied, first, to Base Rate Loans and, second, to
Eurocurrency Loans; and

 

Fourth, any balance of such Proceeds remaining after the Obligations shall have
been paid in full, no Letters of Credit shall be outstanding and the Commitments
shall have terminated shall be paid over to the Borrower or to whomsoever may be
lawfully entitled to receive the same.

 

6.5                                 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 the Administrative Agent to collect
such deficiency.

 

6.6                                 Subordination.  Each Grantor hereby agrees
that, upon the occurrence and during the continuance of an Event of Default,
unless otherwise agreed by the Administrative Agent, all Indebtedness owing by
it to any Subsidiary of the Borrower shall be fully subordinated to the
indefeasible payment in full in cash of such Grantor’s Obligations.

 

6.7                                 Registration Rights.  (a)  Upon the
occurrence and during the continuance of an Event of Default, (i) if the Loans
(with accrued interest thereon) and all other amounts owing under the Loan
Documents have become due and payable in accordance with the Credit Agreement
and (ii) if the Administrative Agent shall determine to exercise its right to
sell any or all of the Pledged Stock pursuant to Section 6.3, and if in the
opinion of the Administrative Agent it is necessary or advisable to have the
Pledged Stock, or that portion thereof to be sold, registered under the
provisions of the Securities Act, the relevant Grantor will cause the Issuer

 

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thereof to (x) 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 or advisable to register the Pledged Stock, or
that portion thereof to be sold, under the provisions of the Securities Act,
(y) use its commercially reasonable 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 the Pledged Stock, or that
portion thereof to be sold, and (z) make all amendments thereto and/or to the
related prospectus which, in the opinion of the Administrative Agent, are
necessary or advisable, all in conformity with the requirements of the
Securities Act and the rules and regulations of the Securities and Exchange
Commission 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 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 Stock, 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 Stock 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 commercially
reasonable 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 Stock
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 Section 6.7 will cause
irreparable injury to the Administrative Agent and the Secured Parties, that the
Administrative Agent and the Secured Parties have no adequate remedy at law in
respect of such breach and, as a consequence, that 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 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.

 

6.8                                 Grant of Intellectual Property License. 
During the continuance of an Event of Default, for the purpose of enabling the
Administrative Agent to exercise the rights and remedies under this Agreement at
such time as the Administrative Agent shall be lawfully entitled to exercise
such rights and remedies, each Grantor hereby (a) grants to the Administrative
Agent, for the benefit of the Administrative Agent and the Secured Parties, a
nonexclusive license (exercisable without payment of royalty or other
compensation to any Grantor) to use, license or sublicense any Intellectual
Property now owned or hereafter acquired by such Grantor, and wherever the same
may be located, and including in such license access to

 

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all media in which any of the licensed items may be recorded or stored and to
all computer software and programs used for the compilation or printout thereof,
the right to prosecute and maintain all Intellectual Property included in the
Collateral and the right to sue for past infringement of such Intellectual
Property; and (b) agrees that the Administrative Agent may sell any of such
Grantor’s Inventory directly to any person, including without limitation persons
who have previously purchased the Grantor’s Inventory from such Grantor and in
connection with any such sale or other enforcement of the Administrative Agent’s
rights under this Agreement, may sell Inventory which bears any Trademark
included in the Collateral and any Inventory that is covered by any Copyright
included in the Collateral and the Administrative Agent may finish any work in
process and affix any Trademark included in the Collateral and sell such
Inventory as provided herein.

 

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 indorse 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, financing statements, documents and papers as the Administrative
Agent may request (A) to evidence the Administrative Agent’s and the Secured
Parties’ security interest in such Intellectual Property, and (B) to perfect
such security interest;

 

(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;

 

(iv)                              execute, in connection with the exercise of
any right or remedy provided for in Section 6.3 or 6.7, any indorsements,
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,

 

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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 indorse 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 Intellectual Property, 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 deems necessary to protect, preserve or realize upon
the Collateral and the Administrative Agent’s 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 it will not exercise any rights under the power
of attorney provided for in this Section 7.1(a)  (other than any rights set
forth in clause (ii) of 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.

 

(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 annum equal to the highest rate per
annum at which interest would then be payable on any category of past due
Revolving Credit Loans that are Base Rate 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 Grantor hereby ratifies all that said
attorneys shall lawfully do or cause to be done by virtue hereof.  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. 
Neither the Administrative Agent, any Secured Party nor any of their respective
officers, directors, employees or agents shall be liable for failure to demand,
collect or realize upon any of the

 

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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 unless such failure constitutes gross negligence,
willful misconduct or fraud.  The powers conferred on the Administrative Agent
and the Secured Parties hereunder are solely to protect the Administrative
Agent’s and the Secured Parties’ interests in the Collateral and shall not
impose any duty upon the Administrative Agent or any Secured Party to exercise
any such powers.  The Administrative Agent and the Secured Parties shall be
accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of their officers, directors,
employees or agents shall be responsible to any Grantor for any act or failure
to act hereunder, except for their (or their officers, directors, employees or
agents’) own gross negligence or willful misconduct.

 

7.3                                 Execution of Financing Statements.  Pursuant
to any applicable law, each Grantor authorizes the Administrative Agent to file
or record financing statements and other filing or recording documents or
instruments with respect to the Collateral without the signature of such Grantor
in such form and in such offices as the Administrative Agent determines
appropriate to perfect the security interests of the Administrative Agent under
this Agreement.  Each Grantor authorizes the Administrative Agent to use the
collateral description “all personal property” in any such financing
statements.  Each Grantor hereby ratifies and authorizes the filing by the
Administrative Agent of any financing statement with respect to the Collateral
made prior to the date hereof.

 

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 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 Sections 8.6 and 12.1 of the Credit
Agreement.

 

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 12.2 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.  Neither the Administrative Agent nor any 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

 

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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
the Administrative Agent or 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 the Administrative Agent or 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 the Administrative Agent or 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.

 

8.4                                 Enforcement Expenses; Indemnification.  (a) 
Subject to the limitations set forth in Section 12.5 of the Credit Agreement,
each Guarantor agrees to pay or reimburse each Secured Party and the
Administrative Agent 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 the Administrative Agent.

 

(b)                                 Each Guarantor agrees to pay, and to save
the Administrative Agent and the Secured Parties 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.

 

(c)                                  Each Guarantor agrees to pay, and to save
the Administrative Agent and the Secured Parties 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 to the extent the Borrower would be required to do so pursuant to
Section 12.5 of the Credit Agreement.

 

(d)                                 The agreements in this Section 8.4 shall
survive repayment of the Obligations and all other amounts payable under the
Credit Agreement and the other Loan Documents.

 

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 Administrative Agent and 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.  Subject to the terms of the
Intercreditor Agreement, in addition to any rights and remedies of the Secured
Parties provided by law, each Secured Party shall have the right, without prior
notice to such Grantor or any other Grantor, any such notice being expressly
waived by each Grantor to the extent permitted by applicable law, upon any
amount becoming due and payable by the Borrower and each Grantor hereunder
(whether at the stated maturity, by acceleration or otherwise), to set off and
appropriate and apply against such amount any and all deposits (general or
special, time or demand, provisional or final), in any currency,

 

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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 Secured Party or any branch or agency thereof to or
for the credit or the account of such Grantor, as the case may be.  Each Secured
Party agrees promptly to notify Parent and the Administrative Agent after any
such set-off and application made by such Secured Party, provided that the
failure to give such notice shall not affect the validity of such set-off and
application.  The rights of the Administrative Agent and each Secured Party
under this Section 8.6 are in addition to other rights and remedies (including,
without limitation, other rights of set-off) which the Administrative Agent or
such Secured Party 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 or 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 Secured Parties with respect to the subject matter hereof and thereof, and
there are no promises, undertakings, representations or warranties by the
Administrative Agent or any Secured Party relative to subject matter hereof and
thereof not expressly set forth or referred to herein or in the other Loan
Documents.  In the event of any conflict between the terms of this Agreement and
the provisions of the Credit Agreement, the provisions of the Credit Agreement
shall control.  With respect to the pledge of any Foreign Subsidiary Voting
Stock, in the event of any conflict between the terms of this Agreement and the
provisions of any pledge agreement covering such Foreign Subsidiary Voting
Stock, the provisions of such pledge agreement shall control.

 

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

 

8.12                           Submission To Jurisdiction; Waivers.  Each of the
Agents, the Secured Parties and each Grantor hereby irrevocably and
unconditionally:

 

(a)                                  submits for itself and its property in any
legal action or proceeding relating to this Agreement and the other Loan
Documents to which it is a party, or for recognition and enforcement of any
judgment in respect thereof, to the non-exclusive general jurisdiction of the
Courts of the State of New York, the courts of the United States of America for
the Southern District of New York, and appellate courts from any thereof;

 

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(b)                                 consents that any such action or proceeding
may be brought in such courts and waives any objection that it may now or
hereafter have to the venue of any such action or proceeding in any such court
or that such action or proceeding was brought in an inconvenient court and
agrees not to plead or claim the same;

 

(c)                                  agrees that service of process in any such
action or proceeding may be effected by mailing a copy thereof by registered or
certified mail (or any substantially similar form of mail), postage prepaid, to
such Grantor at its address referred to in Section 8.2 or at such other address
of which the Administrative Agent shall have been notified pursuant thereto;

 

(d)                                 agrees that nothing herein shall affect the
right to effect service of process in any other manner permitted by law or shall
limit the right to sue in any other jurisdiction; and

 

(e)                                  waives, to the maximum extent not
prohibited by law, any right it may have to claim or recover in any legal action
or proceeding referred to in this Section any special, exemplary, punitive or
consequential damages.

 

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)                                 neither the Administrative Agent nor any
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
Administrative Agent and 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 Parent
that is required to become a party to this Agreement pursuant to Section 8.6 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
substantially in the form of Annex 1 hereto.

 

8.15                           Termination, Releases or Subordination.

 

(a)                                  This Agreement, the security interest
granted to the Administrative Agent and all other security interests granted
hereby shall terminate with respect to all Obligations when all the outstanding
Obligations (other than (x) obligations under Specified Hedge Agreements and
Specified Cash Management Agreements not yet due and payable and (y) contingent
indemnification obligations not yet accrued and payable) have been indefeasibly
paid in full and the Lenders have no further commitment to lend under the Credit
Agreement, the L/C Obligations have been reduced to zero and the Issuing Lenders
have no further obligations to issue Letters of Credit under the Credit
Agreement.

 

(b)                                 A Grantor shall automatically be released
from its obligations hereunder, and the security interest granted to the
Administrative Agent in the Collateral of such Grantor

 

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shall be automatically released, upon the consummation of any transaction
permitted by the Credit Agreement as a result of which such Grantor ceases to be
a Subsidiary; provided that the Required Lenders (or all Lenders, as the case
may be) shall have consented to such transaction (to the extent required by the
Credit Agreement) and the terms of such consent did not provide otherwise.

 

(c)                                  Upon any Disposition by any Grantor of any
Collateral that is permitted under the Credit Agreement, or upon the
effectiveness of any written consent of the Required Lenders (or all Lenders, as
the case may be) to the release of the security interest granted hereby in any
Collateral, the security interest of such Grantor in such Collateral shall be
automatically released or, to the extent permitted under Section 12.16(a) of the
Credit Agreement, subordinated.

 

(d)                                 In connection with any termination, release
or subordination pursuant to paragraph (a), (b) or (c) of this Section 8.15, the
Administrative Agent shall execute and deliver to any Grantor, at such Grantor’s
expense, all documents that such Grantor shall reasonably request to evidence
such termination, release or subordination, as applicable.  Any execution and
delivery of documents pursuant to this Section 8.15 shall be without recourse to
or warranty by the Administrative Agent.

 

8.16                           WAIVER OF JURY TRIAL.  EACH GRANTOR HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.

 

8.17                           INTERCREDITOR AGREEMENT.  Notwithstanding
anything herein to the contrary, the lien and security interest granted pursuant
to this Agreement and the exercise of any right or remedy hereunder are subject
to the provisions of the Intercreditor Agreement.  In the event of any conflict
between the terms of the Intercreditor Agreement and this Agreement, the terms
of the Intercreditor Agreement shall govern and control.

 

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

 

 

SIX FLAGS ENTERTAINMENT

 

CORPORATION

 

 

 

 

 

By:

/s/ James M. Coughlin

 

Name:

James M. Coughlin

 

Title:

General Counsel

 

 

 

 

 

SIX FLAGS OPERATIONS INC.

 

 

 

 

 

By:

/s/ James M. Coughlin

 

Name:

James M. Coughlin

 

Title:

General Counsel

 

 

 

 

 

SIX FLAGS THEME PARKS INC.

 

 

 

 

 

By:

/s/ James M. Coughlin

 

Name:

James M. Coughlin

 

Title:

General Counsel

 

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Fiesta Texas, Inc.

 

Funtime, Inc.

 

Funtime Parks, Inc.

 

Great America LLC

 

Great Escape Holding Inc.

 

Hurricane Harbor GP LLC

 

Hurricane Harbor LP LLC

 

KKI, LLC

 

Magic Mountain LLC

 

Park Management Corp.

 

Premier International Holdings Inc.

 

Premier Parks Holdings Inc.

 

Premier Parks of Colorado Inc.

 

Riverside Park Enterprises, Inc.

 

SF HWP management llc

 

SFJ Management Inc.

 

Six Flags America Property Corporation

 

Six Flags Great Adventure LLC

 

Six Flags Services, Inc.

 

Six Flags Services of Illinois, Inc.

 

Six Flags St. Louis LLC

 

South Street Holdings LLC

 

Stuart Amusement Company

 

 

 

 

 

By:

/s/ Danielle J. Bernthal

 

Name:

Danielle J. Bernthal

 

Title:

Assistant Vice President

 

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Hurricane Harbor LP

 

 

 

By:

Hurricane Harbor GP LLC,

 

 

its General Partner

 

 

 

 

 

 

 

 

By:

/s/ Danielle J. Bernthal

 

 

Name:

Danielle J. Bernthal

 

 

Title:

Assistant Vice President

 

 

 

 

 

 

 

Six Flags America LP

 

 

 

By:

Funtime, Inc.,

 

 

its General Partner

 

 

 

 

 

 

 

 

By:

/s/ Danielle J. Bernthal

 

 

Name:

Danielle J. Bernthal

 

 

Title:

Assistant Vice President

 

 

 

Six Flags Great Escape L.P.

 

Great Escape Theme Park L.P.

 

Great Escape Rides L.P.

 

 

 

By:

Great Escape Holding Inc.,

 

 

their General Partner

 

 

 

 

 

 

 

 

By:

/s/ Danielle J. Bernthal

 

 

Name:

Danielle J. Bernthal

 

 

Title:

Assistant Vice President

 

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JPMORGAN CHASE BANK, N.A., as

 

Administrative Agent

 

 

 

 

 

 By:

/s/ Christophe Vohmann

 

   Name:

Christophe Vohmann

 

   Title:

Authorized Signatory

 

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