Exhibit 10.25

EXECUTION COPY

VIRTUS INVESTMENT PARTNERS, INC.

SECURITY AGREEMENT

among

VIRTUS INVESTMENT PARTNERS, INC.,

EACH OF THE OTHER GRANTORS PARTY HERETO

and

THE BANK OF NEW YORK MELLON,

as Administrative Agent

 

 

Dated as of September 1, 2009

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

TABLE OF CONTENTS

 

          Page   ARTICLE 1. DEFINITIONS; GRANT OF SECURITY; CONTINUING
PERFECTION AND PRIORITY      4        SECTION 1.1    GENERAL DEFINITIONS      4
       SECTION 1.2    OTHER DEFINITIONS; INTERPRETATION      13   
    SECTION 1.3    GRANT OF SECURITY      13    ARTICLE 2. SECURITY FOR
OBLIGATIONS; NO ASSUMPTION OF LIABILITY      15        SECTION 2.1    SECURITY
FOR SECURED OBLIGATIONS      15        SECTION 2.2    NO ASSUMPTION OF LIABILITY
     15    ARTICLE 3. REPRESENTATIONS AND WARRANTIES AND COVENANTS      15   
    SECTION 3.1    GENERALLY      15        SECTION 3.2    EQUIPMENT AND
INVENTORY      19        SECTION 3.3    RECEIVABLES      20        SECTION 3.4
   INVESTMENT-RELATED PROPERTY      21        SECTION 3.5    LETTER-OF-CREDIT
RIGHTS      25        SECTION 3.6    INTELLECTUAL PROPERTY COLLATERAL      25   
    SECTION 3.7    COMMERCIAL TORT CLAIMS      27        SECTION 3.8    DEPOSIT
ACCOUNTS; BLOCKED ACCOUNTS      28    ARTICLE 4. FURTHER ASSURANCES; FILING
AUTHORIZATION      28        SECTION 4.1    FURTHER ASSURANCES      28   
    SECTION 4.2    FILINGS      29    ARTICLE 5. REMEDIES UPON DEFAULT      29
       SECTION 5.1    REMEDIES GENERALLY      29        SECTION 5.2   
APPLICATION OF PROCEEDS OF COLLATERAL      32        SECTION 5.3   
INVESTMENT-RELATED PROPERTY      33        SECTION 5.4    GRANT OF LICENSE TO
USE INTELLECTUAL PROPERTY      34    ARTICLE 6. CONCERNING THE ADMINISTRATIVE
AGENT      34        SECTION 6.1    IN GENERAL      34        SECTION 6.2   
STANDARD OF CARE      34        SECTION 6.3    ADMINISTRATIVE AGENT APPOINTED
ATTORNEY-IN-FACT      35        SECTION 6.4    REIMBURSEMENT OF ADMINISTRATIVE
AGENT      36    ARTICLE 7. WAIVERS; AMENDMENTS      37    ARTICLE 8. SECURITY
INTEREST ABSOLUTE      37    ARTICLE 9. TERMINATION; RELEASE      38    ARTICLE
10. ADDITIONAL GRANTORS      38    ARTICLE 11. NOTICES      39    ARTICLE 12.
BINDING EFFECT; SEVERAL AGREEMENT; ASSIGNMENTS      39   

 

Virtus Investment Partners, Inc. Security Agreement

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

TABLE OF CONTENTS

 

          Page   ARTICLE 13. SURVIVAL OF AGREEMENT; SEVERABILITY      39   
ARTICLE 14. MISCELLANEOUS      40    SECTION 14.1    GOVERNING LAW      40   
SECTION 14.2    COUNTERPARTS; INTEGRATION      40    SECTION 14.3    HEADINGS   
  40    SECTION 14.4    JURISDICTION; VENUE; CONSENT TO SERVICE OF PROCESS     
40    SECTION 14.5    WAIVER OF JURY TRIAL      41   

SCHEDULES:

 

Schedule I    List of Subsidiaries and Addresses for Notices Schedule 3.1(a)(i)
   List of Chief Executive Offices, Jurisdictions of Organization, Federal
Employer Identification Numbers and Company Organizational Numbers Schedule
3.1(a)(ii)    List of Legal and Other Names Schedule 3.1(a)(iii)    List of
Security Agreements Schedule 3.1(a)(v)    List of Liens on Collateral; List of
Financing Statements Schedule 3.1(a)(vii)    List of Material Authorizations
Schedule 3.1(a)(viii)    List of Material Licenses Schedule 3.2    List of
Locations of Equipment and Inventory Schedule 3.4    List of Investment-Related
Property Schedule 3.4(a)(iv)    List of Uncertificated Pledged Equity Interests
Not Subject to Blocked Accounts Schedule 3.4(a)(v)    List of Persons with
Control Over Investment-Related Property Schedule 3.5    List of Letters of
Credit Schedule 3.6    List of Intellectual Property Schedule 3.7    List of
Commercial Tort Claims Schedule 3.8    List of Deposit Accounts

EXHIBITS:

 

Exhibit A    Form of Supplement Exhibit B    Form of Issuer’s Acknowledgment
Exhibit C    Form of Power of Attorney Exhibit D    Form of Letter Agreement
(Secured Hedging Agreements and Secured Cash Management Agreements)

 

(ii)

Virtus Investment Partners, Inc. Security Agreement

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

SECURITY AGREEMENT, dated as of September __, 2009, among Virtus Investment
Partners, Inc., a Delaware corporation (the “Borrower”), each of the
subsidiaries of the Borrower listed on Schedule I or which becomes a party
hereto in accordance with Article 10 (each such subsidiary, individually, a
“Subsidiary Guarantor” and, collectively, the “Subsidiary Guarantors”; the
Subsidiary Guarantors and the Borrower are referred to collectively herein as
the “Grantors”), and THE BANK OF NEW YORK MELLON, as Administrative Agent under
the Credit Agreement referred to in the next paragraph (as amended, supplemented
or otherwise modified from time to time, the “Security Agreement”).

RECITALS

A. Reference is made to the Credit Agreement, dated as of September 1, 2009,
among the Borrower, the Lenders party thereto, and The Bank of New York Mellon,
as Administrative Agent (as the same may be amended, supplemented or otherwise
modified from time to time, the “Credit Agreement”).

B. The Lenders have agreed to make Revolving Loans to, and the Issuing Bank has
agreed to issue Letters of Credit for the account of, the Borrower pursuant to,
and upon the terms and subject to the conditions specified in, the Credit
Agreement. The Grantors acknowledge that the Revolving Loans, Letters of Credit
and other financial accommodations made under the Loan Documents will enhance
the aggregate borrowing powers of the Borrower and credit availability to the
other Loan Parties and facilitate their loan relationship with the Credit
Parties, all to the mutual advantage of the Grantors.

C. Each Grantor acknowledges that it will derive substantial direct and indirect
benefit from the making of the Revolving Loans and the issuance of the Letters
of Credit. Each Guarantor has, pursuant to the Guarantee Agreement,
unconditionally guaranteed the Secured Obligations.

D. This Security Agreement is given by each Grantor in favor of the
Administrative Agent for the benefit of the Secured Parties (as hereinafter
defined) to secure the payment and performance of all of the Secured Obligations
(as hereinafter defined).

E. The execution and delivery by the Grantors of this Security Agreement is a
condition precedent to the effectiveness of the Credit Agreement, and the Credit
Parties would not have entered into the Credit Agreement if the Grantors had not
executed and delivered this Security Agreement.

Accordingly, the Grantors and the Administrative Agent, on behalf of itself and
each other Secured Party (and each of their respective successors or assigns),
hereby agree as follows:

ARTICLE 1.

DEFINITIONS; GRANT OF SECURITY; CONTINUING PERFECTION AND PRIORITY

Section 1.1 General Definitions. As used in this Security Agreement, the
following terms shall have the meanings specified below:

 

Virtus Investment Partners, Inc. Security Agreement

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

“Account Debtor” means each Person who is obligated in respect of any Receivable
or any Supporting Obligation or Collateral Support relating thereto.

“Accounts” means (i) all “accounts” as defined in Article 9 of the UCC and
(ii) all “health-care-insurance receivables”, each as defined in Article 9 of
the UCC.

“Additional Grantor” has the meaning assigned to such term in Article 10.

“Applicable Date” means (i) in the case of any Grantor (other than an Additional
Grantor), the date hereof, and (ii) in the case of any Additional Grantor, the
date of the Supplement executed and delivered by such Additional Grantor.

“Approved Securities Intermediary” means a Securities Intermediary or commodity
intermediary selected or approved by the Administrative Agent and with respect
to which a Grantor has delivered to the Administrative Agent an executed
Securities Account Control Agreement.

“Authorization” means, collectively, any license, approval, permit or other
authorization issued by any Governmental Authority.

“Blocked Account” means a Deposit Account or Securities Account maintained by
any Grantor with a financial institution or Securities Intermediary, as
applicable, selected by such Grantor and reasonably acceptable to the
Administrative Agent, which account is the subject of an effective Deposit
Account Control Agreement or Securities Account Control Agreement.

“Blocked Account Bank” means a financial institution selected or approved by the
Administrative Agent and with respect to which a Grantor has delivered to the
Administrative Agent an executed Deposit Account Control Agreement.

“Borrower” has the meaning assigned to such term in the preliminary statement of
this Security Agreement.

“Cash Collateral Account” means any Deposit Account or Securities Account
established by the Administrative Agent in which cash and/or Permitted
Investments may from time to time be on deposit or held therein pursuant to the
Loan Documents.

“Cash Management Agreement” means an agreement entered into by a Loan Party with
any Lender or an Affiliate thereof pursuant to which such Lender or such
Affiliate provides any one or more of the following types or services or
facilities to any Loan Party: (a) ACH transactions, (b) other cash management
services, including, without limitation, controlled disbursement services,
treasury, depository, overdraft, and electronic funds transfer services,
(c) foreign exchange facilities, (d) credit card processing services, and
(e) credit or debit cards.

“Chattel Paper” means all “chattel paper” as defined in Article 9 of the UCC.

 

- 5 -

Virtus Investment Partners, Inc. Security Agreement

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

“Claim Proceeds” means, with respect to any Commercial Tort Claim or any
Collateral Support or Supporting Obligation relating thereto, all Proceeds
thereof, including all insurance proceeds and other amounts and recoveries
resulting or arising from the settlement or other resolution thereof, in each
case regardless of whether characterized as a “commercial tort claim” under
Article 9 of the UCC or “proceeds” under the UCC.

“Collateral” has the meaning assigned to such term in Section 1.3(a).

“Collateral Records” means all books, instruments, certificates, Records, ledger
cards, files, correspondence, customer lists, blueprints, technical
specifications, manuals and other documents, and all computer software, computer
printouts, tapes, disks and related data processing software and similar items,
in each case that at any time represent, cover or otherwise evidence, or contain
information relating to, any of the Collateral or are otherwise necessary or
helpful in the collection thereof or realization thereupon.

“Collateral Support” means all property (real or personal) assigned,
hypothecated or otherwise securing any of the Collateral, and shall include any
security agreement or other agreement granting a lien or security interest in
such real or personal property.

“Commercial Tort Claims” means all “commercial tort claims” as defined in
Article 9 of the UCC and all Claim Proceeds; including all claims described on
Schedule 3.7.

“Concentration Account” means a Deposit Account of the Grantors with The Bank of
New York Mellon or such other bank or financial institution acceptable to the
Administrative Agent, which shall be a Blocked Account.

“Copyright License” means any written agreement, now or hereafter in effect,
granting any right to any third party under any Copyright now or hereafter owned
or held by or behalf of any Grantor or which any Grantor otherwise has the right
to license, or granting any right to any Grantor under any Copyright now or
hereafter owned by any third party, and all rights of any Grantor under any such
agreement, including each agreement described on Schedule 3.6.

“Copyrights” means all of the following: (i) all copyright rights in any work
subject to the copyright laws of the United States of America or any other
country, whether as author, assignee, transferee or otherwise, (ii) all
registrations and applications for registration of any such copyright in the
United States of America or any other country, including registrations,
recordings, supplemental registrations and pending applications for registration
in the United States Copyright Office or any similar offices in the United
States of America or any other country, including those described on Schedule
3.6, (iii) all rights and privileges arising under applicable law with respect
to the use of such copyrights, (iv) all reissues, renewals, continuations and
extensions thereof and amendments thereto, and (v) all income, fees, royalties,
damages, claims and payments now or hereafter due and/or payable with respect
thereto, including damages and payments for past, present or future
infringements thereof.

 

- 6 -

Virtus Investment Partners, Inc. Security Agreement

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

“Credit Agreement” has the meaning assigned to such term in the preliminary
statement of this Security Agreement.

“Deposit Accounts” means all “deposit accounts” as defined in Article 9 of the
UCC, including all such accounts described on Schedule 3.8.

“Deposit Account Control Agreement” means a Deposit Account Control Agreement,
in form and substance reasonably satisfactory to the Administrative Agent,
executed by any Grantor and the Administrative Agent and acknowledged and agreed
to by the relevant financial institution, providing for “control” (within the
meaning of the UCC) by the Administrative Agent over a Deposit Account.

“Documents” means all “documents” as defined in Article 9 of the UCC.

“Equipment” means (i) all “equipment” as defined in Article 9 of the UCC,
(ii) all machinery, manufacturing equipment, data processing equipment,
computers, office equipment, furnishings, furniture, appliances, fixtures and
tools, in each case, regardless of whether characterized as “equipment” under
the UCC, and (iii) all accessions or additions to any of the foregoing, all
parts thereof, whether or not at any time of determination incorporated or
installed therein or attached thereto, and all replacements therefor, wherever
located, now or hereafter existing.

“Financial Assets” means all “financial assets” as defined in Article 8 of the
UCC.

“Federal Securities Laws” has the meaning assigned to such term in Section 5.3.

“General Intangibles” means (i) all “general intangibles” as defined in Article
9 of the UCC and (ii) all choses in action and causes of action, all
indemnification claims, all goodwill, all Hedging Agreements, all tax refunds,
all licenses, permits, concessions, franchises and authorizations, all
Intellectual Property, all Payment Intangibles, all Authorizations and all
Software, in each case regardless of whether characterized as a “general
intangible” under the UCC; including all rights and interests under all capital
contribution, subscription and similar agreements.

“Goods” means (i) all “goods” as defined in Article 9 of the UCC and (ii) all
Equipment and Inventory and any computer program embedded in goods and any
supporting information provided in connection with such program, to the extent
(a) such program is associated with such goods in such a manner that it is
customarily considered part of such goods or (b) by becoming the owner of such
goods, a Person acquires a right to use the program in connection with such
goods, in each case regardless of whether characterized as a “good” under the
UCC.

“Grantor” and “Grantors” have the meanings assigned to such terms in the
preliminary statement of this Security Agreement.

“Instruments” means all “instruments” as defined in Article 9 of the UCC.

 

- 7 -

Virtus Investment Partners, Inc. Security Agreement

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

“Insurance” means all insurance policies covering any or all of the Collateral
(regardless of whether the Administrative Agent or any other Secured Party is
the loss payee thereof) and all business interruption insurance policies.

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

“Inventory” means (i) all “inventory” as defined in Article 9 of the UCC and
(ii) all goods held for sale or lease or to be furnished under contracts of
service or so leased or furnished, all raw materials, work in process, finished
goods and materials used or consumed in the manufacture, packing, shipping,
advertising, selling, leasing, furnishing or production of such inventory or
otherwise used or consumed in any Grantor’s business, all goods which are
returned to or repossessed by or on behalf of any Grantor, and all computer
programs embedded in any goods, and all accessions thereto and products thereof,
in each case, regardless of whether characterized as “inventory” under the UCC.

“Investment Property” means “investment property” as defined in Article 9 of the
UCC.

“Investment-Related Property” means (i) all Pledged Collateral and (ii) all
other Investment Property owned or held by or on behalf of any Grantor.

“Issuer’s Acknowledgment” means an acknowledgment substantially in the form of
Exhibit B.

“Letter-of-Credit Rights” means (i) all “letter-of-credit rights” as defined in
Article 9 of the UCC and (ii) all rights, title and interests of each Grantor to
any letter of credit, in each case regardless of whether characterized as a
“letter-of-credit right” under the UCC.

“License” means any Copyright License, Patent License, Trademark License, Trade
Secret License or other license (other than any Authorization) or sublicense to
which any Grantor is a party.

“Material Commercial Tort Claims” means, with respect to each Grantor, (i) all
Commercial Tort Claims asserted by it, or on its behalf, in writing, and
(ii) each Commercial Tort Claim in excess of $50,000 to which it has any right,
title or interest and of which it is aware.

“Patent License” means any written agreement, now or hereafter in effect,
granting to any third party any right to make, use or sell any invention on
which a Patent, now or hereafter owned or held by or on behalf of any Grantor or
which any Grantor otherwise has the

 

- 8 -

Virtus Investment Partners, Inc. Security Agreement

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

right to license, is in existence, or granting to any Grantor any right to make,
use or sell any invention on which a Patent, now or hereafter owned by any third
party, is in existence, and all rights of any Grantor under any such agreement,
including each agreement described on Schedule 3.6.

“Patents” means all of the following: (i) all letters patent of the United
States of America or any other country, all registrations and recordings thereof
and all applications for letters patent of the United States of America or any
other country, including registrations, recordings and pending applications in
the United States Patent and Trademark Office or any similar offices in the
United States of America or any other country, including those described on
Schedule 3.6, (ii) all inventions and improvements described and claimed
therein, including the right to make, use and/or sell the inventions disclosed
or claimed therein, (iii) all reissues, continuations, divisions, continuations
in part, renewals or extensions thereof and amendments thereto, and the
inventions disclosed or claimed therein, and (iv) all income, fees, royalties,
damages, claims and payments now or hereafter due and/or payable thereunder and
with respect thereto.

“Payment Intangibles” means all “payment intangibles” as defined in Article 9 of
the UCC.

“Pledged Collateral” means, collectively, Pledged Debt and Pledged Equity
Interests.

“Pledged Debt” means all debt owed or owing to any Grantor and not held in a
Securities Account or otherwise through a Securities Intermediary, including all
such debt described on Schedule 3.4, all Instruments, Chattel Paper or other
documents, if any, representing or evidencing such debt, and all interest, cash,
instruments and other property or proceeds from time to time received,
receivable or otherwise distributed in respect of or in exchange for any or all
of such debt.

“Pledged Equity Interests” means all Equity Interests owned or held by or on
behalf of any Grantor and not held in a Securities Account or otherwise through
a Securities Intermediary, including all such Equity Interests described on
Schedule 3.4, and all certificates, instruments and other documents, if any,
representing or evidencing such Equity Interests and all interests of such
Grantor on the books and records of the issuers of such Equity Interests, all of
such Grantor’s right, title and interest in, to and under any partnership,
limited liability company, shareholder or similar agreements to which it is a
party, and all dividends, distributions, cash, warrants, rights, options,
instruments, securities and other property or proceeds from time to time
received, receivable or otherwise distributed in respect of or in exchange for
any or all of such Equity Interests.

“Power of Attorney” means a Special Power of Attorney in substantially the form
of Exhibit C.

“Proceeds” means (i) all “proceeds” as defined in Article 9 of the UCC,
(ii) payments or distributions made with respect to any Collateral, (iii) any
payment received from

 

- 9 -

Virtus Investment Partners, Inc. Security Agreement

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

any insurer or other Person or entity as a result of the destruction, loss,
theft, damage or other involuntary conversion of whatever nature of any asset or
property that constitutes the Collateral, and (iv) whatever is receivable or
received when any of the Collateral or proceeds are sold, exchanged, collected
or otherwise disposed of, whether such disposition is voluntary or involuntary,
including any claim of any Grantor against any third party for (and the right to
sue and recover for and the rights to damages or profits due or accrued arising
out of or in connection with) (a) past, present or future infringement of any
Patent now or hereafter owned or held by or on behalf of any Grantor, or
licensed under a Patent License, (b) past, present or future infringement or
dilution of any Trademark now or hereafter owned or held by or on behalf of any
Grantor, or licensed under a Trademark License, or injury to the goodwill
associated with or symbolized by any Trademark now or hereafter owned or held by
or on behalf of any Grantor, (c) past, present or future infringement of any
Copyright now or hereafter owned or held by or on behalf of any Grantor, or
licensed under a Copyright License, (d) past, present or future infringement of
any Trade Secret now or hereafter owned or held by or on behalf of any Grantor,
or licensed under a Trade Secret License, and (e) past, present or future breach
of any License, in each case, regardless of whether characterized as “proceeds”
under the UCC.

“Receivables” means all rights to payment, whether or not earned by performance,
for goods or other property sold, leased, licensed, assigned or otherwise
disposed of, or services rendered or to be rendered, including all such rights
constituting or evidenced by any Account, Chattel Paper, Instrument or other
document, General Intangible or Investment-Related Property, together with all
of the applicable Grantor’s rights, if any, in any goods or other property
giving rise to such right to payment, and all Collateral Support and Supporting
Obligations relating thereto and all Receivables Records.

“Receivables Records” means (i) all originals of all documents, instruments or
other writings or electronic records or other Records evidencing any Receivable,
(ii) all books, correspondence, credit or other files, Records, ledger sheets or
cards, invoices, and other papers relating to any Receivable, including all
tapes, cards, computer tapes, computer discs, computer runs, record keeping
systems and other papers and documents relating to any Receivable, whether in
the possession or under the control of the applicable Grantor or any computer
bureau or agent from time to time acting for such Grantor or otherwise,
(iii) all evidences of the filing of financing statements and the registration
of other instruments in connection therewith, and amendments, supplements or
other modifications thereto, notices to other creditors or secured parties, and
certificates, acknowledgments, or other writings, including lien search reports,
from filing or other registration officers, (iv) all credit information, reports
and memoranda relating thereto, and (v) all other written forms of information
related in any way to the foregoing or any Receivable.

“Record” means a “record” as defined in Article 9 of the UCC.

“Secured Cash Management Agreement” means a Cash Management Agreement entered
into by a Loan Party with any counterparty that is a Secured Party.

“Secured Hedging Agreement” means a Hedging Agreement entered into by the
Borrower with any counterparty that is a Secured Party.

 

- 10 -

Virtus Investment Partners, Inc. Security Agreement

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

“Secured Obligations” shall mean (i) the Credit Obligations, and (ii) the due
and punctual payment and performance of all obligations of Borrower and the
other Loan Parties under each Secured Hedging Agreement and Secured Cash
Management Agreement.

“Secured Parties” shall mean, collectively, (i) the Administrative Agent,
(ii) each Credit Party, (iii) each party (other than any Loan Party) to a
Hedging Agreement or Cash Management Agreement, as applicable, if at the date of
entering into such Hedging Agreement or Cash Management Agreement, as
applicable, such Person was a Lender or an Affiliate of a Lender and such Person
executes and delivers to the Administrative Agent a letter agreement,
substantially in the form of Exhibit D hereto, pursuant to which such Person
(x) appoints the Administrative Agent as its agent under the applicable Loan
Documents and (y) agrees to be bound by the provisions of Sections 10.3, 10.9
and 10.13 of the Credit Agreement and the provisions of the applicable Loan
Documents, including, without limitation, the provisions of Article 9 hereof,
(iv) the beneficiaries of each indemnification obligation undertaken by or on
behalf of any Grantor under any Loan Document, and (v) the successors and
assigns of each of the foregoing. Notwithstanding the foregoing, The Bank of New
York Mellon and any of its Affiliates party to any such Hedging Agreement while
The Bank of New York Mellon (or any such Affiliate) is a Lender shall be deemed
to be a Secured Party with respect thereto without the necessity of delivering
the letter agreement referred to in this definition.

“Securities Account” means a “securities account” as defined in Article 8 of the
UCC, including all such accounts described on Schedule 3.4.

“Securities Account Control Agreement” means a Securities Account Control
Agreement, in form and substance reasonably satisfactory to the Administrative
Agent, executed by any Grantor and the Administrative Agent and acknowledged and
agreed to by the relevant Approved Securities Intermediary, providing for
“control” (within the meaning of the UCC) by the Administrative Agent over a
Securities Account.

“Securities Intermediary” has the meaning specified in Article 8 of the UCC.

“Security Interest” has the meaning assigned to such term in Section 1.3(a).

“Software” means all “software” as defined in Article 9 of the UCC.

“Subsidiary Guarantor” and “Subsidiary Guarantors” have the meanings assigned to
such terms in the preliminary statement of this Security Agreement.

“Supplement” means a supplement hereto, substantially in the form of Exhibit A.

“Supporting Obligations” means (i) all “supporting obligations” as defined in
Article 9 of the UCC and (ii) all Guarantees and other secondary obligations
supporting any of the Collateral, in each case regardless of whether
characterized as a “supporting obligation” under the UCC.

“Trade Secret Licenses” means any written agreement, now or hereafter in effect,
granting to any third party any right to use any Trade Secrets now or hereafter
owned or held by

 

- 11 -

Virtus Investment Partners, Inc. Security Agreement

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

or on behalf of any Grantor or which such Grantor otherwise has the right to
license, or granting to any Grantor any right to use any Trade Secrets now or
hereafter owned by any third party, and all rights of any Grantor under any such
agreement, including each agreement described on Schedule 3.6.

“Trade Secrets” means all trade secrets and all other confidential or
proprietary information and know-how now or hereafter owned or used in, or
contemplated at any time for use in, the business of any Grantor (all of the
foregoing being collectively called a “Trade Secret”), whether or not such Trade
Secret has been reduced to a writing or other tangible form, including all
documents and things embodying, incorporating or referring in any way to such
Trade Secret, the right to sue for any past, present and future infringement of
any Trade Secret, and all proceeds of the foregoing, including licenses,
royalties, income, payments, claims, damages and proceeds of suit.

“Trademark License” means any written agreement, now or hereafter in effect,
granting to any third party any right to use any Trademark now or hereafter
owned or held by or on behalf of any Grantor or which such Grantor otherwise has
the right to license, or granting to any Grantor any right to use any Trademark
now or hereafter owned by any third party, and all rights of any Grantor under
any such agreement, including each agreement described on Schedule 3.6.

“Trademarks” means all of the following: (i) all trademarks, service marks,
trade names, corporate names, company names, business names, fictitious business
names, trade styles, trade dress, logos, other source or business identifiers,
uniform resource locations (URL’s), domain names, designs and general
intangibles of like nature, now existing or hereafter adopted or acquired,
(ii) all registrations and recordings thereof and all registration and recording
applications filed in connection therewith, including registrations and
registration applications in the United States Patent and Trademark Office or
any similar offices in the United States of America or any other country,
including those described on Schedule 3.6, and (iii) all reissues,
continuations, extensions and renewals thereof and amendments thereto, (iv) all
goodwill associated therewith or symbolized by any of the foregoing, (v) all
income, fees, royalties, damages and payments now and hereafter due and/or
payable thereunder and with respect thereto and (vi) all other assets, rights
and interests that uniquely reflect or embody such goodwill.

“UCC” shall mean the Uniform Commercial Code as in effect from time to time in
the State of New York; provided, however, that, at any time, if by reason of
mandatory provisions of law, any or all of the perfection or priority of the
Administrative Agent’s and the Secured Parties’ security interest in any item or
portion of the Collateral is governed by the Uniform Commercial Code as in
effect in a jurisdiction other than the State of New York, the term “UCC” shall
mean the Uniform Commercial Code as in effect, at such time, in such other
jurisdiction for purposes of the provisions hereof relating to such perfection
or priority and for purposes of definitions relating to such provisions.

“Voting Stock” means, with respect to any person, any class or classes of Equity
Interests pursuant to which the holders thereof have the general voting power
under ordinary circumstances to elect at least a majority of the Board of
Directors of such person.

 

- 12 -

Virtus Investment Partners, Inc. Security Agreement

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

Section 1.2 Other Definitions; Interpretation

(a) Other Definitions. Capitalized terms used herein and not otherwise defined
herein, and the term “subsidiary” shall have the meanings assigned to such terms
in the Credit Agreement.

(b) Rules of Interpretation. The rules of interpretation specified in Sections
1.2, 1.3 and 1.4 of the Credit Agreement shall be applicable to this Security
Agreement. All references herein to (i) a Schedule to this Security Agreement
shall refer to such Schedule hereto or to a Supplement, as applicable, and
(ii) provisions of the UCC shall include all successor provisions under any
subsequent version or amendment to any Article of the UCC.

(c) Resolution of Drafting Ambiguities. Each Grantor acknowledges and agrees
that it was represented by counsel in connection with the execution and delivery
of this Security Agreement, that it and its counsel reviewed and participated in
the preparation and negotiation thereof and that any rule of construction to the
effect that ambiguities are to be resolved against the drafting party shall not
be employed in the interpretation hereof or thereof.

Section 1.3 Grant of Security

(a) As security for the payment or performance, as applicable, in full of the
Secured Obligations, each Grantor hereby bargains, sells, conveys, assigns, sets
over, mortgages, pledges, hypothecates and transfers to the Administrative Agent
(and its successors and assigns), for the ratable benefit of the Secured
Parties, and hereby grants to the Administrative Agent (and its successors and
assigns), for the ratable benefit of the Secured Parties, a security interest
(the “Security Interest”) in, all personal property and fixtures of such
Grantor, including all of such Grantor’s right, title and interest in, to and
under the following, in each case whether now owned or existing or hereafter
acquired or arising and wherever located (all of which being hereinafter
collectively referred to as the “Collateral”):

(i) all Accounts,

(ii) all Cash Collateral Accounts, Securities Accounts and all Deposit Accounts,

(iii) all Chattel Paper,

(iv) all Commercial Tort Claims listed on Schedule 3.7,

(v) all Documents,

(vi) all Equipment,

(vii) all General Intangibles,

(viii) all Goods,

 

- 13 -

Virtus Investment Partners, Inc. Security Agreement

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

(ix) all Instruments,

(x) all Insurance,

(xi) all Intellectual Property,

(xii) all Inventory,

(xiii) all Investment-Related Property, including all Pledged Collateral and all
Blocked Accounts,

(xiv) all Letter-of-Credit Rights,

(xv) all Proceeds of Authorizations and, subject to the provisions of
Section 1.3(c), all Authorizations and the goodwill associated with all
Authorizations,

(xvi) all Receivables and Receivables Records,

(xvii) all other goods and other personal property of such Grantor, whether
tangible or intangible, including all “money” as defined in Article 9 of the
UCC,

(xviii) to the extent not otherwise included in clauses (i) through (xvii) of
this Section, all Collateral Records, Collateral Support and Supporting
Obligations in respect of any of the foregoing,

(xix) to the extent not otherwise included in clauses (i) through (xviii) of
this Section, all other property in which a security interest may be granted
under the UCC or which may be delivered to and held by the Administrative Agent
pursuant to the terms hereof (including the account referred to in
Section 3.4(c)(ii) and all funds and other property from time to time therein or
credited thereto), and

(xx) to the extent not otherwise included in clauses (i) through (xix) of this
Section, all Proceeds, products, substitutions, accessions, rents and profits of
or in respect of any of the foregoing.

(b) Revisions to UCC. For the avoidance of doubt, it is expressly understood and
agreed that, to the extent the UCC is revised after the date hereof such that
the definition of any of the foregoing terms included in the description or
definition of the Collateral is changed, the parties hereto desire that any
property which is included in such changed definitions, but which would not
otherwise be included in the Security Interest on the date hereof, nevertheless
be included in the Security Interest upon the effective date of such revision.
Notwithstanding the immediately preceding sentence, the Security Interest is
intended to apply immediately on the Agreement Date to all of the Collateral to
the fullest extent permitted by applicable law, regardless of whether any
particular item of the Collateral was then subject to the UCC.

(c) Certain Limited Exclusions. Notwithstanding anything in this Section 1.3 to
the contrary, in no event shall the Collateral include, and no Grantor shall be
deemed to have

 

- 14 -

Virtus Investment Partners, Inc. Security Agreement

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

granted a Security Interest in, (i) any right under any Authorization, lease,
license or other contract or agreement constituting a General Intangible, but
only to the extent that the granting of a security interest therein or an
assignment thereof would violate any applicable law or any enforceable provision
of lease, license or other contract or agreement, as applicable, provided that
to the extent such security interest at any time hereafter shall no longer be
prohibited by law, and/or immediately upon such provision no longer being
enforceable, as the case may be, the Collateral shall automatically and without
any further action include, and the Grantors shall be deemed to have granted
automatically and without any further action a Security Interest in, such right
as if such law had never existed or such provision had never been enforceable,
as the case may be, (ii) any Margin Stock, and (iii) any Equity Interests of a
Foreign Subsidiary which is a controlled foreign corporation (as defined in
Section 957(a) of the Code), provided that this exclusion shall not apply to
(x) Voting Stock of any Foreign Subsidiary which is a controlled foreign
corporation representing 65% (or such lesser percentage as is owned by the
Grantors) of the total voting power of all outstanding Voting Stock of such
Foreign Subsidiary and (y) 100% (or such lesser percentage as is owned by the
Grantors) of the Equity Interests not constituting Voting Stock of any such
Foreign Subsidiary, except that any such Equity Interests constituting “stock
entitled to vote” within the meaning of Treas. Reg. Section 1.956-2(c)(2) shall
be treated as Voting Stock for purposes of this Section 1.3(c).

ARTICLE 2.

SECURITY FOR OBLIGATIONS; NO ASSUMPTION OF LIABILITY

Section 2.1 Security for Secured Obligations. This Security Agreement secures,
and the Collateral is collateral security for, the prompt and complete payment
or performance in full when due, whether at stated maturity, by required
prepayment, declaration, acceleration, demand or otherwise (including the
payment of amounts that would become due but for the operation of the automatic
stay under Section 362(a) of Title 11 of the United States Code, or any similar
provision of any other bankruptcy, insolvency, receivership or other similar
law), of all Secured Obligations.

Section 2.2 No Assumption of Liability. Notwithstanding anything to the contrary
herein, the Security Interest is granted as security only and shall not subject
the Administrative Agent or any other Secured Party to, or in any way alter or
modify, any obligation or liability of any Grantor with respect to or arising
out of the Collateral.

ARTICLE 3.

REPRESENTATIONS AND WARRANTIES AND COVENANTS

Section 3.1 Generally

(a) Representations and Warranties. Each of the Grantors, jointly with the other
Grantors and severally, represents and warrants to the Administrative Agent and
the other Secured Parties that:

 

- 15 -

Virtus Investment Partners, Inc. Security Agreement

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

(i) As of the Applicable Date, (A) such Grantor’s chief executive office or its
principal place of business is, and for the preceding four months has been,
located at the office indicated on Schedule 3.1(a)(i), (B) such Grantor’s
jurisdiction of organization is the jurisdiction indicated on Schedule
3.1(a)(i), and (C) such Grantor’s Federal Employer Identification Number and
company organizational number is as set forth on Schedule 3.1(a)(i).

(ii) As of the Applicable Date, (A) such Grantor’s exact legal name as such name
appears in its certificate of incorporation or other organizational document, is
as set forth on Schedule 3.1(a)(ii) and (B) such Grantor has not done in the
preceding five years, and does not do, business under any other name (including
any trade-name or fictitious business name), except for those names set forth on
Schedule 3.1(a)(ii).

(iii) Except as set forth on Schedule 3.1(a)(iii), such Grantor has not within
the five years preceding the Applicable Date become bound (whether as a result
of merger or otherwise) as debtor under a security agreement entered into by
another Person, which has not theretofore been terminated.

(iv) Such Grantor has good and valid rights in or title to, the Collateral with
respect to which it has purported to grant the Security Interest, except for
minor defects in title that do not interfere with its ability to conduct its
business as currently conducted or to utilize such Collateral for its intended
purposes, and except for Liens expressly permitted pursuant to the Loan
Documents.

(v) Except as set forth on Schedule 3.1(a)(v), all Collateral owned or rights in
Collateral held by it or on its behalf is owned or held by it or on its behalf
free and clear of any Lien, except for Liens expressly permitted by the Loan
Documents. Except as set forth on Schedule 3.1(a)(v), it has not filed or
consented to the filing of (A) any financing statement or analogous document
under the UCC or any other applicable laws covering any such Collateral, (B) any
assignment in which it assigns any such Collateral or any security agreement or
similar instrument covering any such Collateral with the United States Patent
and Trademark Office or the United States Copyright Office, or any similar
offices in the United States of America or any other country, or (C) any
assignment in which it assigns any such Collateral or any security agreement or
similar instrument covering any such Collateral with any foreign governmental,
municipal or other office, in each case which financing statement, analogous
document, assignment or other instrument, as applicable, is still in effect,
except for Liens expressly permitted by the Loan Documents.

(vi) The Security Interest in the Collateral owned or rights in Collateral held
by it or on its behalf (A) is effective to vest in the Administrative Agent, on
behalf of the Secured Parties, the rights of the Administrative Agent in such
Collateral as set forth herein and (B) does not violate Regulation T, U or X as
of the Applicable Date.

(vii) As of the Applicable Date, all material Authorizations are as listed on
Schedule 3.1(a)(vii).

 

- 16 -

Virtus Investment Partners, Inc. Security Agreement

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

(viii) Except as set forth on Schedule 3.1(a)(viii), all leases, licenses and
other contracts and agreements as to which no security interest is granted by
virtue of Section 1.3(c) are not material to the business of the Borrower or any
of the Subsidiaries, taken as a whole.

(b) Covenants and Agreements. Each Grantor hereby covenants and agrees as
follows:

(i) It shall maintain, at its own cost and expense, such complete and accurate
Records with respect to the Collateral owned or held by it or on its behalf as
is consistent with its current practices and in accordance with such prudent and
standard practices used in industries that are the same as or similar to those
in which it is engaged, but in any event to include complete accounting Records
indicating all payments and proceeds received with respect to any part of such
Collateral, and, at such time or times as the Administrative Agent may
reasonably request, promptly to prepare and deliver to the Administrative Agent
a duly certified schedule or schedules in form and detail satisfactory to the
Administrative Agent showing the identity and amount of any and all such
Collateral.

(ii) It shall, at its own cost and expense, take any and all actions necessary
to defend title to the Collateral owned or rights in Collateral held by it or on
its behalf against all Persons and to defend the Security Interest in such
Collateral and the priority thereof against any Lien or other interest not
expressly permitted by the Loan Documents, and in furtherance thereof, it shall
not take, or permit to be taken, any action not otherwise expressly permitted by
the Loan Documents that could impair the Security Interest or the priority
thereof or any Secured Party’s rights in or to such Collateral.

(iii) During normal business hours and upon reasonable advance written notice,
the Administrative Agent and such Persons as the Administrative Agent may
designate shall, as often as reasonably requested, have the right, at the cost
and expense of such Grantor, to inspect all of its Records (and to make extracts
and copies from such Records), to discuss its affairs with its officers and
independent accountants and to verify under reasonable procedures the validity,
amount, quality, quantity, value, condition and status of, or any other matter
relating to, the Collateral owned or rights in Collateral held by or on behalf
of such Grantor, including, in the case of Receivables, Pledged Debt, General
Intangibles, Commercial Tort Claims or Collateral in the possession of any third
person, by contacting Account Debtors, contract parties or other obligors
thereon or any third person possessing such Collateral for the purpose of making
such a verification. The Administrative Agent shall have the absolute right to
share on a confidential basis any information it gains from such inspection or
verification with any Secured Party.

(iv) 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 owned or held by or on behalf of
such Grantor, and not permitted by the Loan Documents, and may pay for the
maintenance and preservation of such Collateral to the extent such Grantor fails
to do so as required by the Loan Documents, and such Grantor agrees, jointly
with the other Grantors and severally, to reimburse the Administrative

 

- 17 -

Virtus Investment Partners, Inc. Security Agreement

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

Agent on demand for any payment made or any expense incurred by the
Administrative Agent pursuant to the foregoing authorization; provided, however,
that 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 other Secured Party to 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 or in the
other Loan Documents.

(v) It shall remain liable for the failure to observe and perform all the
conditions and obligations to be observed and performed by it under each
contract, agreement or instrument relating to the Collateral owned or held by it
or on its behalf, all in accordance with the terms and conditions thereof, and
it agrees, jointly with the other Grantors and severally, to indemnify and hold
harmless the Administrative Agent and the other Secured Parties from and against
any and all liability for such performance.

(vi) It shall not make, or permit to be made, an assignment, pledge or
hypothecation of the Collateral owned or held by it or on its behalf, or grant
any other Lien in respect of such Collateral, except as expressly permitted by
the Loan Documents. Except for Liens or transfers expressly permitted by the
Loan Documents, it shall not make or permit to be made any transfer of such
Collateral, and it shall remain at all times in possession of such Collateral
and the direct owner, beneficially and of record, of the Pledged Equity
Interests included in such Collateral, except that (A) Inventory may be sold in
the ordinary course of business, (B) ) mutual fund shares included in the
Pledged Equity Interests may be sold, exchanged or transferred by the Grantors
in the ordinary course of business and (C) unless and until the Administrative
Agent shall notify it that an Event of Default shall have occurred and be
continuing and that, during the continuance thereof, it shall not sell, convey,
lease, assign, transfer or otherwise dispose of any such Collateral (which
notice may be given by telephone if promptly confirmed in writing), it may use
and dispose of such Collateral in any lawful manner not inconsistent with the
provisions of this Security Agreement or any other Loan Document.

(vii) It shall, at its own cost and expense, maintain or cause to be maintained
insurance covering physical loss or damage to the Collateral owned or held by it
or on its behalf against all risks and liability arising from the use or
intended use, or otherwise attributable or relating to, such Collateral, in each
case in accordance with Section 6.10 of the Credit Agreement. It shall cause
each such insurance policy (other than any policy related to workers’
compensation) to (A) name the Administrative Agent as an “additional insured”
and “loss payee” if such policy is a property policy, (B) provide that the
Administrative Agent and each Lender shall be notified in writing of any
proposed cancellation or material change in risk, of such policy, initiated by
such Grantor’s insurer at least 30 days (or at least 10 days with respect to a
failure to pay any premium due) prior to any proposed cancellation or material
change in risk, (C) contain a waiver of subrogation in favor of the
Administrative Agent, (D) provide that the insurance shall be primary and
without right of contribution from any other insurance which may be available to
the Administrative Agent and the other Secured Parties, (E) provide that the
Administrative Agent and other Secured Parties have no responsibility for
premiums, warranties or representations to underwriters. On the Agreement Date
(as provided in Section 5.1 of the Credit Agreement) and at least 30 days prior
to expiry of each such insurance

 

- 18 -

Virtus Investment Partners, Inc. Security Agreement

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

policy, such Grantor shall deliver or cause to be delivered to the
Administrative Agent an insurance broker’s opinion letter from such Grantor’s
independent insurance agent confirming that the insurance premiums with respect
to the policies of insurance required to be maintained pursuant to this
subsection have been paid, that such policies are in force and that such
policies meet the requirements set forth in this subsection. Such Grantor shall
also furnish or cause be furnished a certificate of insurance (1) evidencing
that all of the coverages listed in this subsection have been renewed and
continue to be in full force and effect for such period as shall be then
stipulated, (2) specifying the insurers with whom such insurance is carried and
(3) containing such other certifications and undertakings as are customarily
provided to the Administrative Agent and the other Secured Parties, as
reasonably requested by the Administrative Agent. Such Grantor irrevocably
makes, constitutes and appoints the Administrative Agent (and all officers,
employees or agents designated by the Administrative Agent) as such Grantor’s
true and lawful agent (and attorney-in-fact) for the purpose, during the
continuance of an Event of Default, of making, settling and adjusting claims in
respect of such Collateral under policies of insurance, endorsing the name of
such Grantor on any check, draft, instrument or other item of payment for the
proceeds of such policies of insurance and for making all determinations and
decisions with respect thereto. In the event that such Grantor at any time or
times shall fail to obtain or maintain any of the policies of insurance required
hereby or to pay any premium in whole or part relating thereto, the
Administrative Agent may, without waiving or releasing any obligation or
liability of the Grantors hereunder or any Event of Default, in its sole
discretion, obtain and maintain such policies of insurance and pay such premium
and take any other actions with respect thereto as the Administrative Agent
deems advisable. All sums disbursed by the Administrative Agent in connection
with this subsection, including reasonable attorneys’ fees and expenses, court
costs, expenses and other charges relating thereto, shall be payable, upon
demand, by such Grantor to the Administrative Agent and shall be additional
Secured Obligations secured hereby.

(viii) It will not change its state of organization, maintain its place of
business (if it has only one) or its chief executive office (if it has more than
one place of business) at a location other than a location specified on Schedule
3.1(a)(i) or change its name, state organization number or taxpayer
identification number unless the Borrower shall have given the Administrative
Agent not less than 30 days’ prior written notice of such event or occurrence
and the Administrative Agent shall have either (x) determined that such event or
occurrence will not adversely affect the validity, perfection or priority of the
Administrative Agent’s security interest in the Collateral, or (y) taken such
steps (with the cooperation of the Borrower to the extent necessary or
advisable) as are necessary or advisable to properly maintain the validity,
perfection and priority of the Administrative Agent’s security interest in the
Collateral.

Section 3.2 Equipment and Inventory

(a) Each of the Grantors, jointly with the other Grantors and severally,
represents and warrants to the Administrative Agent and the other Secured
Parties that, as of the Applicable Date, all of the Equipment and Inventory
included in the Collateral owned or held by it or on its behalf (other than
mobile goods, Inventory and Equipment in transit and other Collateral in which
possession is not maintained in the ordinary course of its business) is kept
only at the

 

- 19 -

Virtus Investment Partners, Inc. Security Agreement

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

locations specified on Schedule 3.2, which Schedule sets forth with respect to
each Grantor, Equipment and Inventory (i) maintained at the premises owned by
any Grantor, (ii) maintained at leased premises, (iii) in the possession of a
warehouseman or other bailee and (iv) on consignment.

(b) Each Grantor covenants and agrees that it shall not permit any Equipment or
Inventory with a value in excess of $25,000 owned or held by it or on its behalf
(and shall not permit, with respect to all Grantors, taken as a whole, Equipment
and Inventory with a value in excess of $50,000 in the aggregate) to be in the
possession or control of any warehouseman, bailee, agent or processor for a
period of greater than thirty (30) consecutive days, unless such warehouseman,
bailee, agent or processor shall have been notified of the Security Interest
and, at the request of the Administrative Agent, shall have agreed in writing to
hold such Equipment or Inventory subject to the Security Interest and the
instructions of the Administrative Agent and to waive and release any Lien held
by it with respect to such Equipment or Inventory, whether arising by operation
of law or otherwise.

Section 3.3 Receivables

(a) Representations and Warranties. Each of the Grantors, jointly with the other
Grantors and severally, represents and warrants to the Administrative Agent and
the other Secured Parties that no Receivable included in the Collateral owned or
held by it or on its behalf is evidenced by an Instrument or Chattel Paper that
has not been delivered to the Administrative Agent.

(b) Covenants and Agreements. Each Grantor hereby covenants and agrees that:

(i) It shall mark conspicuously, in form and manner reasonably satisfactory to
the Administrative Agent, all Chattel Paper, Instruments and other evidence of
any Receivables included in the Collateral owned or held by it or on its behalf
(other than any delivered to the Administrative Agent as provided herein), as
well as the related Receivables Records, with an appropriate reference to the
fact that the Administrative Agent has a security interest therein.

(ii) It will not, without the Administrative Agent’s prior written consent
(which consent shall not be unreasonably withheld), grant any extension of the
time of payment of any such Receivable, compromise, compound or settle the same
for less than the full amount thereof, release, wholly or partly, any Supporting
Obligation or Collateral Support relating thereto, or allow any credit or
discount whatsoever thereon, other than extensions, credits, discounts,
releases, compromises or settlements granted or made in the ordinary course of
business and consistent with its current practices or in accordance with such
practices reasonably believed by such Grantor to be prudent.

(iii) Except as otherwise provided in this Section, it shall continue to collect
all amounts due or to become due to it under all such Receivables and any
Supporting Obligations or Collateral Support relating thereto, and diligently
exercise each material right it

 

- 20 -

Virtus Investment Partners, Inc. Security Agreement

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

may have thereunder, in each case at its own cost and expense, and in connection
with such collections and exercise, it shall, upon the occurrence and during the
continuance of an Event of Default, take such action as it or the Administrative
Agent may reasonably deem necessary. Notwithstanding the foregoing, the
Administrative Agent shall have the right at any time after the occurrence and
during the continuance of an Event of Default to notify, or require such Grantor
to notify, any Account Debtor with respect to any such Receivable, Supporting
Obligation or Collateral Support of the Administrative Agent’s security interest
therein, and in addition, at any time during the continuation of an Event of
Default, the Administrative Agent may: (A) direct such Account Debtor to make
payment of all amounts due or to become due to such Grantor thereunder directly
to the Administrative Agent and (B) enforce, at the cost and expense of such
Grantor, collection thereof and to adjust, settle or compromise the amount or
payment thereof, in the same manner and to the same extent as such Grantor would
be able to have done. If the Administrative Agent notifies such Grantor that it
has elected to collect any such Receivable, Supporting Obligation or Collateral
Support in accordance with the preceding sentence, any payments thereof received
by such Grantor shall not be commingled 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 hereunder and shall be forthwith delivered
to the Administrative Agent in the same form as so received (with any necessary
indorsement), and such Grantor shall not grant any extension of the time of
payment thereof, compromise, compound or settle the same for less than the full
amount thereof, release the same, wholly or partly, or allow any credit or
discount whatsoever thereon.

(iv) It shall use its best efforts to keep in full force and effect any
Supporting Obligation or Collateral Support relating to any Receivable.

(v) During the continuance of a Default, at the request of the Administrative
Agent, it shall direct each Account Debtor to make payment on each Receivable to
a Blocked Account or the Concentration Account.

Section 3.4 Investment-Related Property

(a) Representations and Warranties. Each of the Grantors, jointly with the other
Grantors and severally, represents and warrants to the Administrative Agent and
the other Secured Parties that:

(i) Schedule 3.4 sets forth, as of the Applicable Date, (i) all of the
Investment-Related Property included in the Collateral owned or rights therein
held by or on behalf of such Grantor and (ii) each Securities Account maintained
by or on behalf of such Grantor.

(ii) All Pledged Equity Interests (A) consisting of Equity Interests in
Subsidiaries included in the Collateral owned or held by it or on its behalf
have been duly authorized and validly issued and are fully paid and
non-assessable and (B) not described in clause (A) above have, to the knowledge
of such Grantor, been duly authorized and validly issued and are fully paid and
non-assessable. Each Grantor is the direct owner, beneficially and

 

- 21 -

Virtus Investment Partners, Inc. Security Agreement

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

of record of all Pledged Equity Interests pledged by it, free and clear of all
Liens (other than Liens expressly permitted by the Loan Documents).

(iii) All Pledged Debt (A) issued by a Subsidiary included in the Collateral
owned or held by it or on its behalf has been duly authorized, issued and
delivered and, where necessary, authenticated, and (B) not described in clause
(A) above has, to the knowledge of such Grantor, been duly authorized, issued
and delivered and, where necessary, authenticated. To the knowledge of each
Grantor, all Pledged Debt pledged by such Grantor 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.

(iv) Except as set forth on Schedule 3.4(a)(iv), other than the Pledged Equity
Interests that constitute General Intangibles, there is no Investment-Related
Property other than that (x) represented by certificated securities or
Instruments in the possession of the Administrative Agent and (y) held in a
Securities Account that is a Blocked Account.

(v) Except as set forth on Schedule 3.4(a)(v), no Person other than the
Administrative Agent has “control” (within the meaning of Article 8 of the UCC)
over any Investment-Related Property of such Grantor.

(b) Registration in Nominee Name; Denominations. Each Grantor hereby agrees that
(i) without limiting Section 6.4, the Administrative Agent, on behalf of the
Secured Parties, shall have the right (in its sole and absolute discretion) to
hold, where applicable, Investment-Related Property included in the Collateral
owned or held by it or on its behalf in the Administrative Agent’s 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, where applicable, in blank or in favor
of the Administrative Agent, (ii) at the Administrative Agent’s request, such
Grantor will promptly give to the Administrative Agent copies of any material
notices or other written communications received by it with respect to any
Investment-Related Property included in the Collateral owned or held by it or on
its behalf registered in its name and (iii) the Administrative Agent shall at
all times have the right to exchange any certificates, instruments or other
documents representing or evidencing any Investment-Related Property included in
the Collateral owned or held by or on behalf of such Grantor for certificates,
instruments or other documents of smaller or larger denominations for any
purpose consistent with this Security Agreement.

(c) Voting and Distributions.

(i) Unless and until an Event of Default shall have occurred and be continuing:

(A) Each Grantor shall be entitled to exercise any and all voting and/or other
consensual rights and powers inuring to an owner of the Investment-Related
Property included in the Collateral owned or held by it or on its behalf, or any
part

 

- 22 -

Virtus Investment Partners, Inc. Security Agreement

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

thereof, for any purpose consistent with the terms of this Security Agreement
and the other Loan Documents; provided, however, that such Grantor will not be
entitled to exercise any such right if the result thereof could materially and
adversely affect the rights inuring to a holder of the Investment-Related
Property or the rights and remedies of any of the Secured Parties under this
Security Agreement or any other Loan Document or the ability of any of the
Secured Parties to exercise the same.

(B) The Administrative Agent shall execute and deliver to each Grantor, or cause
to be executed and delivered to each Grantor, all such proxies, powers of
attorney and other instruments as such Grantor may reasonably request for the
purpose of enabling it to exercise the voting and/or consensual rights and
powers it is entitled to exercise pursuant to subsection (c)(i)(A) and to
receive the cash payments it is entitled to receive pursuant to subsection
(c)(i)(C).

(C) Each Grantor shall be entitled to receive, retain and use any and all cash
dividends, interest and principal paid on the Investment-Related Property
included in the Collateral owned or held by it or on its behalf to the extent
and only to the extent that such cash dividends, interest and principal are not
prohibited by, and not otherwise paid in a manner that violates the terms and
conditions of the Credit Agreement, the other Loan Documents and applicable
laws. All non-cash dividends, interest and principal, and all dividends,
interest and principal paid or payable in cash or otherwise in connection with a
partial or total liquidation or dissolution, return of capital, capital surplus
or paid in surplus, and all other distributions (other than distributions
referred to in the preceding sentence) made on or in respect of the
Investment-Related Property included in the Collateral owned or held by it or on
its behalf, whether paid or payable in cash or otherwise, whether resulting from
a subdivision, combination or reclassification of the outstanding Equity
Interests in any issuer or received in exchange for any Investment-Related
Property, 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 such Grantor, shall not be commingled 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 hereunder and shall be
forthwith delivered to the Administrative Agent in the same form as so received
(with any necessary endorsement).

(ii) Without limiting the generality of the foregoing, upon the occurrence and
during the continuance of an Event of Default:

(A) All rights of each Grantor to dividends, interest or principal that it is
authorized to receive pursuant to subsection (c)(i)(C) 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 or principal, as applicable. All dividends, interest and
principal received by or on behalf of any Grantor contrary to the provisions of
this Section shall be held in trust for the benefit of the Administrative Agent,
shall be segregated from other property or funds of such Grantor and shall be
forthwith delivered to the Administrative Agent upon demand in the

 

- 23 -

Virtus Investment Partners, Inc. Security Agreement

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

same form as so received (with any necessary endorsement). Any and all money and
other property paid over to or received by the Administrative Agent pursuant to
the provisions of this subsection (c)(ii)(A) shall be retained by the
Administrative Agent in an account to be established in the name of the
Administrative Agent, for the ratable benefit of the Secured Parties, upon
receipt of such money or other property and shall be applied in accordance with
the provisions of Section 5.2. Subject to the provisions of this subsection
(c)(ii)(A), such account shall at all times be under the sole dominion and
control of the Administrative Agent, and the Administrative Agent shall at all
times have the sole right to make withdrawals therefrom and to exercise all
rights with respect to the funds and other property from time to time therein or
credited thereto as set forth in the Loan Documents. After all Events of Default
have been cured or waived, the Administrative Agent shall, within five Business
Days after all such Events of Default have been cured or waived, repay to the
applicable Grantor all cash dividends, interest and principal (without interest)
that such Grantor would otherwise be permitted to retain pursuant to the terms
of subsection (c)(i)(C) and which remain in such account.

(B) All rights of each Grantor to exercise the voting and consensual rights and
powers it is entitled to exercise pursuant to subsection (c)(i)(A), and the
obligations of the Administrative Agent under subsection (c)(i)(B), 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 such Grantor to exercise such rights. After all Events of Default have
been cured or waived, the applicable Grantor will have the right to exercise the
voting and consensual rights and powers that it would otherwise be entitled to
exercise pursuant to the terms of subsection (c)(i)(A).

(d) Covenants and Agreements. Each Grantor hereby covenants and agrees as
follows:

(i) Each Grantor hereby agrees that all certificates or instruments representing
or evidencing Investment-Related Property acquired by such Grantor after the
Applicable Date shall be delivered to the Administrative Agent at the time
required by the Credit Agreement. All certificated Investment-Related Property
shall be in suitable form for transfer by delivery or shall be accompanied by
duly executed instruments of transfer or assignment in blank, all in form and
substance satisfactory to the Administrative Agent.

(ii) Each Grantor agrees that it will not establish or maintain, or permit any
other Grantor to establish or maintain, any Securities Account or commodities
account that is not a Blocked Account.

(iii) Each Grantor hereby agrees that if any Investment-Related Property (other
than Investment-Related Property held in a Securities Account) is at any time
not evidenced by certificates of ownership, then it shall (A) cause the issuer
thereof to execute and deliver to the Administrative Agent an Issuer’s
Acknowledgment of the pledge, (B) if necessary

 

- 24 -

Virtus Investment Partners, Inc. Security Agreement

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

to perfect a security interest in such Investment-Related Property, cause such
pledge to be recorded on the equityholder register or the books of the issuer,
execute any customary pledge forms or other documents necessary or appropriate
to complete the pledge and give the Administrative Agent the right to transfer
such Investment-Related Property under the terms hereof and (C) after the
occurrence and during the continuance of any Event of Default, upon request by
the Administrative Agent, (1) cause the Organizational Documents of each such
issuer that is a Subsidiary of the Borrower to be amended to provide that such
Investment-Related Property shall be treated as “securities” for purposes of the
UCC and (2) cause such Investment-Related Property to become certificated and
delivered to the Administrative Agent in accordance with the provisions of
clause (i) above.

(iv) In the event (A) any Grantor or any Approved Securities Intermediary shall,
after the date hereof, terminate an agreement with respect to the maintenance of
a Blocked Account for any reason, (B) the Administrative Agent shall demand the
termination of an agreement with respect to the maintenance of a Blocked Account
as a result of the failure of an Approved Securities Intermediary to comply with
the terms of the applicable Securities Account Control Agreement, or (C) the
Administrative Agent determines in its sole discretion that the financial
condition of an Approved Securities Intermediary has materially deteriorated,
such Grantor agrees to promptly transfer the assets held in such Blocked Account
to another Blocked Account acceptable to the Administrative Agent.

Section 3.5 Letter-of-Credit Rights. Each of the Grantors, jointly with the
other Grantors and severally, represents and warrants to the Administrative
Agent and the other Secured Parties that Schedule 3.5 sets forth, as of the
Applicable Date, each letter of credit giving rise to a Letter of Credit Right
included in the Collateral owned or held by or on behalf of such Grantor.

Section 3.6 Intellectual Property Collateral

(a) Representations and Warranties. Each of the Grantors, jointly with the other
Grantors and severally, represents and warrants to the Administrative Agent and
the other Secured Parties that Schedule 3.6 sets forth, as of the Applicable
Date, a list of all of the (i) Trademarks, Patents and Copyrights, in each case
included in the Collateral owned by or on behalf of such Grantor and with
respect to which a registration, recording or pending application has been made
in the United States Patent and Trademark Office or the United States Copyright
Office, as applicable, or any similar offices in the United States of America or
any other country, and (ii) Trademark Licenses, Patent Licenses, Copyright
Licenses and Trade Secret Licenses, in each case included in the Collateral
owned or held by or on behalf of such Grantor.

(b) Covenants and Agreements. Each Grantor hereby covenants and agrees as
follows:

(i) It will not, nor will it permit any of its licensees (or sublicensees) to,
knowingly do any act, or omit to do any act, whereby any material Patent
included in the Collateral and that is related to the conduct of its business
may become invalidated or dedicated to the public, and it shall continue to mark
any products covered by a Patent with the relevant

 

- 25 -

Virtus Investment Partners, Inc. Security Agreement

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

patent number as necessary to establish and preserve its maximum rights under
applicable patent laws.

(ii) It will (either directly or through its licensees or its sublicensees), for
each material Trademark included in the Collateral that is related to the
conduct of its business, (A) maintain such Trademark in full force free from any
claim of abandonment or invalidity for non-use, (B) maintain the quality of
products and services offered under any such Trademark, (C) display such
Trademark with notice of Federal or other analogous registration to the extent
necessary to establish and preserve its rights under applicable law, and (D) not
knowingly use or knowingly permit any of its licensees or sublicensees to use
such Trademark in violation of any third party’s valid and legal rights.

(iii) It will (either directly or through its licensees or its sublicensees),
for each work covered by a Copyright included in the Collateral that is related
to the conduct of its business, continue to publish, reproduce, display, adopt
and distribute the material work with appropriate copyright notice as necessary
to establish and preserve its maximum rights under applicable copyright laws.

(iv) It will promptly notify the Administrative Agent in writing if it knows
that any Intellectual Property included in the Collateral material to the
conduct of its business may become abandoned, lost or dedicated to the public,
or of any adverse determination or development (including the institution of, or
any such determination or development in, any proceeding in the United States
Patent and Trademark Office or the United States Copyright Office, or any
similar offices or tribunals in the United States of America or any other
country) regarding such Grantor’s ownership of any such Intellectual Property,
its right to register the same, or to keep and maintain the same.

(v) In no event shall it, either directly or through any agent, employee,
licensee or designee, file an application for any Intellectual Property with the
United States Patent and Trademark Office, the United States Copyright Office or
any similar offices in the United States of America or any other country, unless
it promptly notifies the Administrative Agent in writing thereof and, upon
request of the Administrative Agent, executes and delivers any and all
agreements, instruments, documents and papers as the Administrative Agent may
reasonably request to evidence the Administrative Agent’s security interest in
such Intellectual Property, and such Grantor hereby appoints the Administrative
Agent as its attorney-in-fact to execute and file such writings for the
foregoing purposes, all acts of such attorney being hereby ratified and
confirmed; such power, being coupled with an interest, is irrevocable.

(vi) It will take all necessary steps that are consistent with the practice in
any proceeding before the United States Patent and Trademark Office, the United
States Copyright Office or any similar offices or tribunals in the United States
of America or any other country, to maintain and pursue each material
application relating to the Intellectual Property included in the Collateral
owned or held by it or on its behalf (and to obtain the relevant grant or
registration) and to maintain each issued Patent and each registered Trademark
and Copyright included in the Collateral that is material to the conduct of its
business, including timely filings of applications for renewal, affidavits of
use, affidavits of incontestability and payment of

 

- 26 -

Virtus Investment Partners, Inc. Security Agreement

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

maintenance fees, and, if consistent, in good faith, with reasonable business
judgment, to initiate opposition, interference and cancellation proceedings
against third parties. In the event that it has reason to believe that any
Intellectual Property included in the Collateral material to the conduct of its
business has been or is about to be infringed, misappropriated or diluted by a
third party, it promptly shall notify the Administrative Agent in writing and
shall, if consistent, in good faith, with reasonable business judgment, promptly
sue for infringement, misappropriation or dilution and to recover any and all
damages for such infringement, misappropriation or dilution, and take such other
actions consistent with reasonable business practices under the circumstances to
protect such Intellectual Property.

(vii) During the continuance of an Event of Default, it shall use its best
efforts to obtain all requisite consents or approvals by the licensor of each
License included in the Collateral owned or held by it or on its behalf to
effect the assignment (as collateral security) of all of its right, title and
interest thereunder to the Administrative Agent or its designee.

(viii) It shall take reasonable steps necessary to protect the secrecy of all
Trade Secrets used in the conduct of its business, including restricting access
to such Trade Secrets.

(ix) It shall continue to collect all amounts due or to become due to such
Grantor under all material Intellectual Property included in the Collateral
owned or held by it or on its behalf, and diligently exercise each material
right it may have thereunder, in each case at its own cost and expense, and in
connection with such collections and exercise, it shall, upon the occurrence and
during the continuance of an Event of Default, take such action as it or the
Administrative Agent may reasonably deem necessary. Notwithstanding the
foregoing, the Administrative Agent shall have the right at any time after the
occurrence and during the continuance of an Event of Default to notify, or
require such Grantor to notify, any relevant obligors with respect to such
amounts of the Administrative Agent’s security interest therein.

Section 3.7 Commercial Tort Claims

(a) Representations and Warranties. Each of the Grantors, jointly with the other
Grantors and severally, represents and warrants to the Administrative Agent and
the other Secured Parties that Schedule 3.7 sets forth, as of the Applicable
Date, all Material Commercial Tort Claims.

(b) Covenants and Agreements. Each Grantor hereby covenants and agrees that it
shall provide the Administrative Agent with prompt written notice of each
Material Commercial Tort Claim, and any judgment, settlement or other
disposition thereof and will take such action as the Administrative Agent may
request to grant and perfect a security interest therein in favor of the
Administrative Agent and the other Secured Parties.

 

- 27 -

Virtus Investment Partners, Inc. Security Agreement

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

Section 3.8 Deposit Accounts; Blocked Accounts

(a) Representations and Warranties. The only Deposit Accounts maintained by any
Grantor on the Applicable Date are those listed on Schedule 3.8 which sets forth
such information separately for each Grantor.

(b) Covenants and Agreements. Each Grantor hereby covenants and agrees as
follows:

(i) Each Grantor shall cause all cash and all Proceeds received by such Grantor
to be deposited in, or swept into, a Blocked Account or, at the direction of the
Administrative Agent, the Concentration Account on a daily basis, except that
cash to make Permitted Investments may be deposited in a Blocked Account;
provided that after giving effect to such deposit and/or cash sweep, (1) the
amount of such cash and Proceeds on deposit in any account other than the
Concentration Account or a Blocked Account shall not exceed $25,000 (exclusive
of the amounts in accounts for unpaid payroll, payroll taxes and withholding
taxes), and (2) the aggregate amount of such cash and Proceeds on deposit in all
accounts other than the Concentration Account or a Blocked Account shall not
exceed $100,000 (exclusive of the amounts in accounts for unpaid payroll,
payroll taxes and withholding taxes), and (B) not establish or maintain, or
permit any other Grantor to establish or maintain, any account with any
financial or other institution in which Proceeds are deposited other than the
Concentration Account or a Blocked Account; provided that amounts in all such
accounts are deposited in, or swept into, the Concentration Account or a Blocked
Account as set forth in clause (A); provided, further, that the amount in the
accounts so indicated on Schedule 3.8 which are for unpaid payroll, payroll
taxes and withholding taxes are not required to be swept on a daily basis. So
long as no Event of Default has occurred and is continuing, a Grantor may
transfer funds from the Blocked Account to any existing disbursement or Deposit
Accounts of such Grantor.

(ii) In the event (A) any Grantor or any Blocked Account Bank shall, after the
date hereof, terminate an agreement with respect to the maintenance of a Blocked
Account for any reason, (B) the Administrative Agent shall demand the
termination of an agreement with respect to the maintenance of a Blocked Account
as a result of the failure of a Blocked Account Bank to comply with the terms of
the applicable Deposit Account Control Agreement, or (C) the Administrative
Agent determines in its sole discretion that the financial condition of a
Blocked Account Bank has materially deteriorated, such Grantor agrees to notify
all of its obligors that were making payments to such terminated Blocked Account
to make all future payments to another Blocked Account.

ARTICLE 4.

FURTHER ASSURANCES; FILING AUTHORIZATION

Section 4.1 Further Assurances. Each Grantor hereby covenants and agrees, at its
own cost and expense, to execute, acknowledge, deliver and/or cause to be duly
filed all such further agreements, instruments and other documents (including
favorable legal opinions in connection with any Transaction if reasonably
required by the Administrative Agent), and take all such

 

- 28 -

Virtus Investment Partners, Inc. Security Agreement

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

further actions, that the Administrative Agent may from time to time reasonably
request to preserve, protect and perfect the Security Interest granted by it and
the rights and remedies created hereby, including the payment of any fees and
taxes required in connection with its execution and delivery of this Security
Agreement, the granting by it of the Security Interest and the filing of any
financing statements or other documents in connection herewith or therewith.

Section 4.2 Filings

(a) Each Grantor hereby irrevocably authorizes the Administrative Agent at any
time and from time to time to file in any relevant jurisdiction any financing
statements and amendments thereto that contain the information required by
Article 9 of the Uniform Commercial Code of each applicable jurisdiction for the
filing of any financing statement or amendment relating to the Collateral,
including (i) whether such Grantor is an organization, the type of organization
and any organizational identification number issued to such Grantor, and
(ii) any financing or continuation statements or other documents without the
signature of such Grantor where permitted by law, including the filing of a
financing statement describing the Collateral as “all assets now owned or
hereafter acquired by the Grantor or in which Grantor otherwise has rights” or
any similar phrase. Each Grantor agrees to provide all information described in
the immediately preceding sentence to the Administrative Agent promptly upon the
reasonable request by the Administrative Agent.

(b) Each Grantor hereby further authorizes the Administrative Agent to file
filings with the United States Patent and Trademark Office or United States
Copyright Office (or any successor office or any similar office in any other
country), including this Security Agreement or other documents for the purpose
of perfecting, confirming, continuing, enforcing or protecting the security
interest granted by such Grantor hereunder, without the signature of such
Grantor, and naming such Grantor, as debtor, and the Administrative Agent, as
secured party.

ARTICLE 5.

REMEDIES UPON DEFAULT

Section 5.1 Remedies Generally

(a) General Rights. Upon the occurrence and during the continuance of an Event
of Default, each Grantor agrees to deliver each item of Collateral owned or held
by it or on its behalf to the Administrative Agent on demand, and it is agreed
that the Administrative Agent shall have the right to take any of or all the
following actions at the same or different times: (i) with respect to any
Collateral consisting of Intellectual Property or Commercial Tort Claims, on
demand, to cause the Security Interest to become an assignment, transfer and
conveyance of any such Collateral by the applicable Grantors to the
Administrative Agent, or, in the case of Intellectual Property, to license or
sublicense, whether general, special or otherwise, and whether on an exclusive
or non-exclusive basis, any such Collateral throughout the world on such terms
and conditions and in such manner as the Administrative Agent shall determine,
unless any of the Grantor’s obligations set forth in this clause (a) would
violate any then-existing licensing

 

- 29 -

Virtus Investment Partners, Inc. Security Agreement

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

arrangements to the extent that waivers cannot be obtained, (ii) with or without
legal process and with or without prior notice or demand for performance, to
take possession of the Collateral owned or held by it or on its behalf and
without liability for trespass to enter any premises where such Collateral may
be located for the purpose of taking possession of or removing such Collateral
and, generally, to exercise any and all rights afforded to a secured party under
the UCC or other applicable law, and (iii) appoint a receiver for all or any
portion of the Collateral. Without limiting the generality of the foregoing,
each Grantor agrees that the Administrative Agent shall have the right, upon the
occurrence and during the continuance of an Event of Default, subject to the
mandatory requirements of applicable law, to sell or otherwise dispose of any of
the Collateral owned or held by or on behalf of such Grantor, at 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 Administrative Agent shall deem
appropriate. The Administrative Agent shall be irrevocably authorized at any
such sale of such Collateral constituting 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 such 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 such sale shall hold the property
sold absolutely, free from any claim or right on the part of the applicable
Grantor, and such Grantor hereby waives (to the extent permitted by law) all
rights of redemption, stay, valuation 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) Sale of Collateral. The Administrative Agent shall give each Grantor ten
days’ written notice (which such Grantor agrees is reasonable notice within the
meaning of Section 9-611 of the UCC as in effect in the State of New York or its
equivalent in other jurisdictions (or any successor provisions)) of the
Administrative Agent’s intention to make any sale of any of the Collateral owned
or held by or on behalf of such Grantor. 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 such Collateral 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 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 any 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

 

- 30 -

Virtus Investment Partners, Inc. Security Agreement

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

again upon like notice. At any public (or, to the extent permitted by applicable
law, private) sale made pursuant to this Section, any Secured Party may bid for
or purchase, free (to the extent permitted by applicable law) from any right of
redemption, stay, valuation or appraisal on the part of such Grantor (all said
rights being also hereby waived and released to the extent permitted by law),
any of the Collateral offered for sale and may make payment on account thereof
by using any claim then due and payable to such Secured Party from such 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 such Grantor therefor. For purposes hereof,
(i) a written agreement to purchase any of the Collateral shall be treated as a
sale thereof, (ii) the Administrative Agent shall be free to carry out such sale
pursuant to such agreement, and (iii) no Grantor shall be entitled to the return
of any of the Collateral 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 Secured 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 upon any of the Collateral and to sell any of the Collateral pursuant
to a judgment or decree of a court or courts having competent jurisdiction or
pursuant to a proceeding by a court-appointed receiver. Any sale pursuant to the
provisions of this Article shall be deemed to conform to the commercially
reasonable standards as provided in Part 6 of Article 9 of the UCC as in effect
in the State of New York or its equivalent in other jurisdictions (or any
successor provisions). Without limiting the generality of the foregoing, each
Grantor agrees as follows: (A) if the proceeds of any sale of the Collateral
owned or held by it or on its behalf pursuant to this Article are insufficient
to pay all the Secured Obligations, it shall be liable for the resulting
deficiency and the fees, charges and disbursements of any counsel employed by
the Administrative Agent or any other Secured Party to collect such deficiency,
(B) it hereby waives any claims against the Administrative Agent arising by
reason of the fact that the price at which any such Collateral may have been
sold at any private sale pursuant to this Article was less than the price that
might have been obtained at a public sale, even if the Administrative Agent
accepts the first offer received and does not offer such Collateral to more than
one offeree, (C) there is no adequate remedy at law for failure by it to comply
with the provisions of this Section and that such failure would not be
adequately compensable in damages, and therefore agrees that its agreements in
this Section may be specifically enforced, (D) the Administrative Agent may sell
any such Collateral without giving any warranties as to such Collateral, and the
Administrative Agent may specifically disclaim any warranties of title or the
like, and (E) the Administrative Agent shall have no obligation to marshal any
such Collateral.

(c) Authorizations. Notwithstanding anything to the contrary contained in any
Loan Document or in any other agreement, instrument or document executed by any
Grantor and delivered to the Administrative Agent, the Administrative Agent will
not take any action pursuant to any Loan Document or any other document referred
to above which would constitute or result in any assignment of any Authorization
issued by any applicable Governmental Authority, or constitute or result in any
change of control (whether de jure or de facto) of such Grantor or any of its
subsidiaries if such assignment of any such Authorization or change of control
would require, under then existing law, the prior approval from such applicable
Governmental Authority, without first obtaining such prior approval of such
other Governmental

 

- 31 -

Virtus Investment Partners, Inc. Security Agreement

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

Authority. Upon the occurrence of an Event of Default or at any time thereafter
during the continuance thereof, such Grantor agrees to take any action which the
Administrative Agent may reasonably request in order to obtain from any
Governmental Authority such approval as may be necessary to enable the
Administrative Agent to exercise and enjoy the full rights and benefits granted
to the Administrative Agent by this Security Agreement and the other documents
referred to above, including specifically, at the cost and expense of such
Grantor, the use of best efforts to assist in obtaining approval or such
Governmental Authority for any action or transaction contemplated by this
Security Agreement for which such approval is or shall be required by law, and
specifically, without limitation, upon request, to prepare, sign and file with
such Governmental Authority the assignor’s or transferor’s portion of any
application or applications for consent to the assignment of Authorization or
transfer of control necessary or appropriate under such Governmental Authority’s
rules and regulations for approval of (i) any sale or other disposition of the
Pledged Equity Interests or other Collateral by or on behalf of the
Administrative Agent, or (ii) any assumption by the Administrative Agent of
voting rights in the Pledged Equity Interests effected in accordance with the
terms of this Security Agreement. It is understood and agreed that all
foreclosure and related actions will be made in accordance with the statutes,
regulations and published policies and decisions enforced by such Governmental
Authorities pertaining to such foreclosure and related actions.

Section 5.2 Application of Proceeds of Collateral

(a) Except as expressly provided elsewhere in this Security Agreement and in
Section 6.11 of the Credit Agreement, all proceeds received by the
Administrative Agent in respect of any sale, any collection from, or other
realization upon all or any part of the Collateral as well as any Collateral
consisting of cash shall be applied in full or in part by the Administrative
Agent against, the Secured Obligations in the following order of priority:

FIRST, to the payment of all reasonable costs and expenses incurred by the
Administrative Agent (in its capacity as such hereunder or under any other Loan
Document) in connection with such collection or sale or otherwise in connection
with this Security Agreement, any other Loan Document or any of the Secured
Obligations, including all out of pocket court costs and the reasonable fees and
expenses of its agents and legal counsel, all amounts for which the
Administrative Agent is entitled to indemnification under the Credit Agreement
(in its capacity as the Administrative Agent and not as a Lender), the repayment
of all advances made by the Administrative Agent hereunder or under any other
Loan Document on behalf of any Grantor and any other reasonable out-of-pocket
costs or expenses incurred in connection with the exercise of any right or
remedy hereunder or under any other Loan Document;

SECOND, to the extent of any excess of such proceeds, to the payment in full of
the Secured Obligations (the amounts so applied to be distributed among the
Secured Parties pro rata in accordance with the amounts of the Secured
Obligations owed to them on the date of any such distribution) with the amount
allocable to the Credit Obligations to be applied to the Credit Obligations in
the manner set forth in Section 8.3 of the Credit Agreement; and

 

- 32 -

Virtus Investment Partners, Inc. Security Agreement

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

THIRD, to the extent of any excess of such proceeds to the applicable Grantor,
its successors or assigns, or as a court of competent jurisdiction may otherwise
direct.

The Administrative Agent shall have sole and absolute discretion as to the time
of application of any such proceeds, monies or balances in accordance with this
Security Agreement. Upon any sale of the Collateral by the Administrative Agent
(including pursuant to a power of sale granted by statute or under a judicial
proceeding), the receipt of the purchase money by the Administrative Agent or of
the officer making the sale shall be a sufficient discharge to the purchaser or
purchasers of the Collateral so sold and such purchaser or purchasers shall not
be obligated to see to the application of any part of the purchase money paid
over to the Administrative Agent or such officer or be answerable in any way for
the misapplication thereof.

Section 5.3 Investment-Related Property. In view of the position of each Grantor
in relation to the Investment-Related Property, or because of other current or
future circumstances, a question may arise under the Securities Act of 1933, as
now or hereafter in effect, or any similar statute hereafter enacted analogous
in purpose or effect (such Act and any such similar statute as from time to time
in effect being called the “Federal Securities Laws”) with respect to any
disposition of the Investment-Related Property permitted hereunder. Each Grantor
understands that compliance with the Federal Securities Laws might very strictly
limit the course of conduct of the Administrative Agent if the Administrative
Agent were to attempt to dispose of all or any part of the Investment-Related
Property, and might also limit the extent to which or the manner in which any
subsequent transferee of any Investment-Related Property could dispose of the
same. Similarly, there may be other legal restrictions or limitations affecting
the Administrative Agent in any attempt to dispose of all or part of the
Investment-Related Property under applicable Blue Sky or other state securities
laws or similar laws analogous in purpose or effect. Each Grantor recognizes
that in light of such restrictions and limitations the Administrative Agent may,
with respect to any sale of the Investment-Related Property, limit the
purchasers to those who will agree, among other things, to acquire such
Investment-Related Property for their own account, for investment, and not with
a view to the distribution or resale thereof. Each Grantor acknowledges and
agrees that in light of such restrictions and limitations, the Administrative
Agent, in its sole and absolute discretion, (i) may proceed to make such a sale
whether or not a registration statement for the purpose of registering such
Investment-Related Property, or any part thereof, shall have been filed under
the Federal Securities Laws and (ii) may approach and negotiate with a single
potential purchaser to effect such sale. Each Grantor acknowledges and agrees
that any such sale might result in prices and other terms less favorable to the
seller than if such sale were a public sale without such restrictions. In the
event of any such sale, the Administrative Agent shall incur no responsibility
or liability for selling all or any part of the Investment-Related Property at a
price that the Administrative Agent, in its sole and absolute discretion, may in
good faith deem reasonable under the circumstances, notwithstanding the
possibility that a substantially higher price might have been realized if the
sale were deferred until after registration as aforesaid or if more than a
single purchaser were approached. The provisions of this Section will apply
notwithstanding the existence of a public or private market upon which the
quotations or sales prices may exceed substantially the price at which the
Administrative Agent sells any such Investment-Related Property.

 

- 33 -

Virtus Investment Partners, Inc. Security Agreement

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

Section 5.4 Grant of License to Use Intellectual Property. For the purpose of
enabling the Administrative Agent to exercise rights and remedies under this
Article, at such time as the Administrative Agent shall be lawfully entitled to
exercise such rights and remedies, each Grantor hereby grants, to the extent it
has the right to grant, to the Administrative Agent an irrevocable, nonexclusive
license (exercisable without payment of royalty or other compensation to such
Grantor) to use, license or sublicense any of the Collateral consisting of
Intellectual Property now owned or held or hereafter acquired or held by or on
behalf of such Grantor, and wherever the same may be located, and including in
such license reasonable access to all media in which any of the licensed items
may be recorded or stored and to all computer software and programs used for the
compilation or printout thereof. The use of such license by the Administrative
Agent shall be exercised, at the option of the Administrative Agent, upon the
occurrence and during the continuation of an Event of Default; provided that any
license, sublicense or other transaction entered into by the Administrative
Agent in accordance herewith shall be binding upon such Grantor notwithstanding
any subsequent cure of an Event of Default. Any royalties and other payments
received by the Administrative Agent shall be applied in accordance with
Section 5.2.

ARTICLE 6.

CONCERNING THE ADMINISTRATIVE AGENT

Section 6.1 In General. The Administrative Agent has been appointed as
collateral agent pursuant to the Credit Agreement. The actions of the
Administrative Agent hereunder are subject to the provisions of the Credit
Agreement. The Administrative Agent shall have the right hereunder to make
demands, to give notices, to exercise or refrain from exercising any rights, and
to take or refrain from taking action (including the release or substitution of
the Collateral), in accordance with this Security Agreement and the Credit
Agreement. The Administrative Agent may employ agents and attorneys-in-fact in
connection herewith and shall not be liable for the negligence or misconduct of
any such agents or attorneys-in-fact selected by it in good faith except for
gross negligence or willful misconduct. The Administrative Agent may resign and
a successor Administrative Agent may be appointed in the manner provided in the
Credit Agreement. Upon the acceptance of any appointment as the Administrative
Agent by a successor Administrative Agent, that successor Administrative Agent
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent under this Security
Agreement, and the retiring Administrative Agent shall thereupon be discharged
from its duties and obligations under this Security Agreement. After any
retiring Administrative Agent’s resignation, the provisions hereof shall inure
to its benefit as to any actions taken or omitted to be taken by it under this
Security Agreement while it was the Administrative Agent.

Section 6.2 Standard of Care. The Administrative Agent shall be deemed to have
exercised reasonable care in the custody and preservation of the Collateral in
its possession if such Collateral is accorded treatment substantially equivalent
to that which the Administrative Agent, in its individual capacity, accords its
own property consisting of similar instruments or interests, it being understood
that neither the Administrative Agent nor any of the Secured

 

- 34 -

Virtus Investment Partners, Inc. Security Agreement

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

Parties shall have responsibility for (i) ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other matters
relating to any Pledged Collateral, whether or not the Administrative Agent or
any other Secured Party has or is deemed to have knowledge of such matters or
(ii) taking any necessary steps to preserve rights against any person with
respect to any Collateral.

Section 6.3 Administrative Agent Appointed Attorney-in-Fact. Each Grantor hereby
appoints the Administrative Agent and any officer or agent thereof, as its true
and lawful agent and attorney-in-fact for the purpose of carrying out the
provisions of this Security Agreement and taking any action and executing any
instrument that the Administrative Agent may deem necessary or advisable to
accomplish the purposes hereof, which appointment is irrevocable and coupled
with an interest, and without limiting the generality of the foregoing, the
Administrative Agent shall have the right, with power of substitution for such
Grantor and in such Grantor’s name or otherwise, for the use and benefit of the
Administrative Agent and the other Secured Parties, upon the occurrence and
during the continuance of an Event of Default and at such other time or times
permitted by the Loan Documents, (i) to receive, endorse, assign and/or deliver
any and all notes, acceptances, checks, drafts, money orders or other evidences
of payment relating to the Collateral owned or held by it or on its behalf or
any part thereof; (ii) to demand, collect, receive payment of, give receipt for,
and give discharges and releases of, any of such Collateral; (iii) to sign the
name of such Grantor on any invoice or bill of lading relating to any of such
Collateral; (iv) to send verifications of Receivables included in the Collateral
owned or held by it or on its behalf to any Account Debtor; (v) to commence and
prosecute any and all suits, actions or proceedings at law or in equity in any
court of competent jurisdiction to collect or otherwise realize on any of the
Collateral owned or held by it or on its behalf or to enforce any rights in
respect of any of such Collateral; (vi) to settle, compromise, compound, adjust
or defend any actions, suits or proceedings relating to any of such Collateral;
(vii) to notify, or to require such Grantor to notify, Account Debtors and other
obligors to make payment directly to the Administrative Agent, (viii) to use,
sell, assign, transfer, pledge, make any agreement with respect to or otherwise
deal with any of such Collateral, and (ix) to do all other acts and things
necessary to carry out the purposes of this Security Agreement, as fully and
completely as though the Administrative Agent were the absolute owner of such
Collateral for all purposes; provided, however, that nothing herein contained
shall be construed as requiring or obligating the Administrative Agent or any
other Secured Party to make any commitment or to make any inquiry as to the
nature or sufficiency of any payment received by the Administrative Agent or any
other Secured Party, or to present or file any claim or notice, or to take any
action with respect to any of the Collateral or the monies due or to become due
in respect thereof or any property covered thereby, and no action taken or
omitted to be taken by the Administrative Agent or any other Secured Party with
respect to any of the Collateral shall give rise to any defense, counterclaim or
offset in favor of such Grantor or to any claim or action against the
Administrative Agent or any other Secured Party. In furtherance of the powers
granted in this Section 6.3, each Grantor shall execute and deliver to the
Administrative Agent a Special Power of Attorney in the form of Exhibit C
hereto. The provisions of this Article shall in no event relieve any Grantor of
any of its obligations hereunder or under the other Loan Documents with respect
to any of the Collateral or impose any obligation on the Administrative Agent or
any other Secured Party to proceed in any particular manner with respect to any
of the Collateral, or

 

- 35 -

Virtus Investment Partners, Inc. Security Agreement

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

in any way limit the exercise by the Administrative Agent or any other Secured
Party of any other or further right that it may have on the date of this
Security Agreement or hereafter, whether hereunder, under any other Loan
Document, by law or otherwise. Any sale pursuant to the provisions of this
paragraph shall be deemed to conform to the commercially reasonable standards as
provided in Section 9-611 of the UCC as in effect in the State of New York or
its equivalent in other jurisdictions (or any successor provisions).

Section 6.4 Reimbursement of Administrative Agent. Each Grantor agrees, jointly
with the other Grantors and severally, to pay to the Administrative Agent the
amount of any and all reasonable out-of-pocket expenses, including the
reasonable fees, other charges and disbursements of counsel and of any experts
or agents, that the Administrative Agent may incur in connection with (i) the
administration of this Security Agreement relating to such Grantor or any of its
property, (ii) the custody or preservation of, or the sale of, collection from,
or other realization upon, any of the Collateral owned or held by or on behalf
of such Grantor, (iii) the exercise, enforcement or protection of any of the
rights of the Administrative Agent hereunder relating to such Grantor or any of
its property, or (iv) the failure by such Grantor to perform or observe any of
the provisions hereof. Without limitation of its indemnification obligations
under the other Loan Documents, each of the Grantors agrees, jointly with the
other Grantors and severally, to indemnify the Administrative Agent and the
other Indemnitees against, and hold each Indemnitee harmless from, any and all
losses, claims, damages, liabilities and related out-of-pocket expenses,
including reasonable counsel fees, other charges and disbursements, incurred by
or asserted against any Indemnitee arising out of, in any way connected with, or
as a result of (a) the execution or delivery by such Grantor of this Security
Agreement or any other Loan Document or any agreement or instrument contemplated
hereby or thereby, or the performance by such Grantor of its obligations under
the Loan Documents and the other transactions contemplated thereby or (b) any
claim, litigation, investigation or proceeding relating to any of the foregoing,
whether or not any Indemnitee is a party thereto, provided that such indemnity
shall not, as to any Indemnitee, be available to the extent that such losses,
claims, damages, liabilities or related expenses are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or willful misconduct of such Indemnitee. Any amounts
payable as provided hereunder shall be additional Secured Obligations secured
hereby and by the other Security Documents. The provisions of this Section shall
remain operative and in full force and effect regardless of the termination of
this Security Agreement or any other Loan Document, the consummation of the
transactions contemplated hereby or thereby, the repayment of any of the Secured
Obligations, the invalidity or unenforceability of any term or provision of this
Security Agreement or any other Loan Document or any investigation made by or on
behalf of the Administrative Agent or any other Secured Party. All amounts due
under this Section shall be payable within ten days of written demand therefor
and shall bear interest at the rate specified in Section 3.1 of the Credit
Agreement.

 

- 36 -

Virtus Investment Partners, Inc. Security Agreement

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

ARTICLE 7.

WAIVERS; AMENDMENTS

No failure or delay of the Administrative Agent in exercising any power or right
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of
the Administrative Agent and the other Secured Parties hereunder and under the
other Loan Documents are cumulative and are not exclusive of any rights or
remedies that they would otherwise have. No waiver of any provision of this
Security Agreement or any other Loan Document or consent to any departure by any
Grantor therefrom shall in any event be effective unless the same shall be
permitted by this Section, and then such waiver or consent shall be effective
only in the specific instance and for the purpose for which given. No notice or
demand on any Grantor in any case shall entitle such Grantor to any other or
further notice or demand in similar or other circumstances. Neither this
Security Agreement nor any provision hereof may be waived, amended, supplemented
or otherwise modified, or any departure therefrom consented to, except pursuant
to an agreement or agreements in writing entered into by, between or among the
Administrative Agent and the Grantor or Grantors with respect to which such
waiver, amendment, other modification or consent is to apply, subject to any
consent required in accordance with Section 10.2 of the Credit Agreement.

ARTICLE 8.

SECURITY INTEREST ABSOLUTE

All rights of the Administrative Agent hereunder, the Security Interest and all
obligations of each Grantor hereunder shall be absolute and unconditional
irrespective of (i) any lack of validity or enforceability of the Credit
Agreement, any other Loan Document, any agreement with respect to any of the
Secured Obligations, or any other agreement or instrument relating to any of the
foregoing, (ii) any change in the time, manner or place of payment of, or in any
other term of, all or any of the Secured Obligations, or any other waiver,
amendment, supplement or other modification of, or any consent to any departure
from, the Credit Agreement, any other Loan Document or any other agreement or
instrument relating to any of the foregoing, (iii) except as otherwise expressly
permitted under the Loan Documents or effected pursuant thereto, any exchange,
release or non-perfection of any Lien on any other collateral, or any release or
waiver, amendment, supplement or other modification of, or consent under, or
departure from, any guaranty, securing or guaranteeing all or any of the Secured
Obligations, or (iv) any other circumstance that might otherwise constitute a
defense available to, or a discharge of, any Grantor in respect of the Secured
Obligations or in respect of this Security Agreement or any other Loan Document.

 

- 37 -

Virtus Investment Partners, Inc. Security Agreement

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

ARTICLE 9.

TERMINATION; RELEASE

This Security Agreement and the Security Interest shall terminate when all
Commitments have expired or otherwise terminated and all Credit Obligations have
been finally and indefeasibly paid in full in cash and all Letters of Credit
have expired and all LC Disbursements have been reimbursed in full in cash. Upon
termination of this Security Agreement, the Collateral shall be released from
the Lien of this Security Agreement. Upon the effectiveness of any written
consent to the release of the Security Interest in any Collateral pursuant to
Section 10.2 of the Credit Agreement, the Security Interest in such Collateral
shall be automatically released. Upon any sale, transfer or other disposition of
Collateral permitted by the Loan Documents (other than to a Loan Party), the
Security Interest in such Collateral shall be automatically released (other than
to the extent any such sale, transfer or other disposition of such Collateral
would, immediately after giving effect thereto, result in the receipt by such
Grantor of any other property (whether in the form of Proceeds or otherwise)
that would, but for the release of the Security Interest therein pursuant to
this clause, constitute Collateral, in which event the Lien created hereunder
shall continue in such property). In addition, if any of the Pledged Equity
Interests in any Subsidiary or subsidiary, as applicable, are sold, transferred
or otherwise disposed of pursuant to a transaction permitted by the Loan
Documents and, immediately after giving effect thereto, such Subsidiary or
subsidiary, as applicable, would no longer be a Subsidiary or a subsidiary, as
applicable, then the obligations of such Subsidiary or subsidiary, as
applicable, under this Security Agreement and the Security Interest in the
Collateral owned or rights in Collateral held by or on behalf of such Subsidiary
or such subsidiary, as applicable, shall be automatically released. In
connection with any termination or release pursuant to this Section, the
Administrative Agent shall execute and deliver to the applicable Grantor, at
such Grantor’s own cost and expense, all Uniform Commercial Code termination
statements and similar documents that such Grantor may reasonably request to
evidence such termination or release. Any execution and delivery of documents
pursuant to this Article shall be without recourse to or warranty by the
Administrative Agent or any other Secured Party.

ARTICLE 10.

ADDITIONAL GRANTORS

Upon execution and delivery after the date hereof by the Administrative Agent
and a Subsidiary of a Supplement, such Subsidiary or subsidiary, as applicable,
shall become a Grantor hereunder with the same force and effect as if originally
named as a Grantor herein (each an “Additional Grantor”). The execution and
delivery of any Supplement shall not require the consent of any other Grantor
hereunder. The rights and obligations of each Grantor hereunder and each other
Loan Party and other party (other than a Credit Party) under the Loan Documents
shall remain in full force and effect notwithstanding the addition of any
Additional Grantor as a party to this Security Agreement.

 

- 38 -

Virtus Investment Partners, Inc. Security Agreement

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

ARTICLE 11.

NOTICES

All communications and notices hereunder shall be in writing and given as
provided in Section 10.1 of the Credit Agreement. All communications and notices
hereunder to the Administrative Agent or the Borrower shall be given to it at
its address for notices set forth in such Section, and all communications and
notices hereunder to any Grantor shall be given to it at the address set forth
for such Guarantor on Schedule I, with a copy to the Borrower.

ARTICLE 12.

BINDING EFFECT; SEVERAL AGREEMENT; ASSIGNMENTS

Whenever in this Security Agreement any of the parties hereto is referred to,
such reference shall be deemed to include the successors and assigns of such
party, and all covenants, promises and agreements by or on behalf of any Grantor
that are contained in this Security Agreement shall bind and inure to the
benefit of each party hereto and its successors and assigns. This Security
Agreement shall become effective as to any Grantor when a counterpart hereof
executed on behalf of such Grantor shall have been delivered to the
Administrative Agent and a counterpart hereof shall have been executed on behalf
of the Administrative Agent, and thereafter shall be binding upon such Grantor
and the Administrative Agent and their respective successors and assigns, and
shall inure to the benefit of such Grantor, the Administrative Agent and the
other Secured Parties, and their respective successors and assigns, except that
no Grantor shall have the right to assign its rights or obligations hereunder or
any interest herein or in any of the Collateral (and any such attempted
assignment shall be void), except as expressly contemplated by this Security
Agreement or the other Loan Documents. This Security Agreement shall be
construed as a separate agreement with respect to each of the Grantors and may
be amended, supplemented, waived or otherwise modified or released with respect
to any Grantor without the approval of any other Grantor and without affecting
the obligations of any other Grantor hereunder.

ARTICLE 13.

SURVIVAL OF AGREEMENT; SEVERABILITY

All covenants, agreements, representations and warranties made by the Grantors
herein and in the certificates or other instruments prepared or delivered in
connection with or pursuant to this Security Agreement or any other Loan
Document shall be considered to have been relied upon by the Administrative
Agent and the other Secured Parties and shall survive the execution and delivery
of any Loan Document and the making of any Revolving Loan or issuance of any
Letter of Credit, regardless of any investigation made by the Secured Parties or
on their behalf, and shall continue in full force and effect until this Security
Agreement shall terminate. In the event any one or more of the provisions
contained in this Security Agreement or in any other Loan Document should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein or therein shall
not in

 

- 39 -

Virtus Investment Partners, Inc. Security Agreement

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

any way be affected or impaired thereby (it being understood that the invalidity
of a particular provision in a particular jurisdiction shall not in and of
itself affect the validity of such provision in any other jurisdiction). The
parties shall endeavor in good faith negotiations to replace the invalid,
illegal or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of such invalid, illegal or
unenforceable provisions.

ARTICLE 14.

MISCELLANEOUS

Section 14.1 GOVERNING LAW. THIS SECURITY AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO CONFLICT OF LAWS PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION.

Section 14.2 Counterparts; Integration. This Security Agreement may be executed
in counterparts (and by different parties hereto on different counterparts),
each of which shall constitute an original, but all of which, when taken
together, shall constitute but one contract (subject to Article 12), and shall
become effective as provided in Article 12. This Security Agreement constitutes
the entire contract among the parties relating to the subject matter hereof and
supersedes any and all previous agreements and understandings, oral or written,
relating to the subject matter hereof. Delivery of an executed counterpart of
this Security Agreement by facsimile transmission shall be as effective as
delivery of a manually executed counterpart of this Security Agreement.

Section 14.3 Headings. Article and Section headings used herein are for
convenience of reference only, are not part of this Security Agreement and shall
not affect the construction of, or be taken into consideration in interpreting,
this Security Agreement.

Section 14.4 Jurisdiction; Venue; Consent to Service of Process. Each Grantor
hereby irrevocably and unconditionally submits, for itself and its property, to
the nonexclusive jurisdiction of any New York State court or Federal court of
the United States of America sitting in New York City, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Security Agreement or the other Loan Documents, or for recognition or
enforcement of any judgment, and each of the parties hereto hereby irrevocably
and unconditionally agrees that, to the extent permitted by applicable law, all
claims in respect of any such action or proceeding may be heard and determined
in such New York State court or, to the extent permitted by applicable law, in
such Federal court. Each of the parties hereto agrees that a final judgment in
any such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Security Agreement shall affect any right that the
Administrative Agent or any other Secured Party may otherwise have to bring any
action or proceeding relating to this Security Agreement or the other Loan
Documents against any Grantor or any of its property in the courts of any
jurisdiction. Each Grantor hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection that it may
now or hereafter have to the laying

 

- 40 -

Virtus Investment Partners, Inc. Security Agreement

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

of venue of any suit, action or proceeding arising out of or relating to this
Security Agreement or the other Loan Documents in any foregoing court referred
to in this Article. Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by applicable law, the defense of an inconvenient forum
to the maintenance of such action or proceeding in any such court. Each of the
parties hereto irrevocably consents to service of process in the manner provided
for notices in Article 11. Nothing in this Security Agreement will affect the
right of any party hereto to serve process in any other manner permitted by law.

Section 14.5 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER
OR IN CONNECTION WITH THIS SECURITY AGREEMENT. EACH PARTY HERETO HEREBY
(I) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY
HERETO HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (II)
ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER
INTO THIS SECURITY AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS ARTICLE.

[Remainder of Page Intentionally Left Blank]

 

- 41 -

Virtus Investment Partners, Inc. Security Agreement

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

IN WITNESS WHEREOF, the parties hereto have duly executed this Security
Agreement as of the day and year first above written.

 

VIRTUS INVESTMENT PARTNERS, INC. By:   /s/ Michael A. Angerthal Name:   Michael
A. Angerthal Title:   Executive Vice President & Chief Financial Officer DUFF &
PHELPS INVESTMENT MANAGEMENT CO. By:   /s/ Michael A. Angerthal Name:   Michael
A. Angerthal Title:   Executive Vice President & Treasurer ENGEMANN ASSET
MANAGEMENT By:   /s/ Michael A. Angerthal Name:   Michael A. Angerthal Title:  
Executive Vice President & Chief Financial Officer EUCLID ADVISORS LLC By:   /s/
Michael A. Angerthal Name:   Michael A. Angerthal Title:   Executive Vice
President & Treasurer KAYNE ANDERSON RUDNICK INVESTMENT MANAGEMENT, LLC By:  
/s/ Michael A. Angerthal Name:   Michael A. Angerthal Title:   Senior Vice
President & Chief Financial Officer

 

Virtus Investment Partners, Inc. Security Agreement

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

PASADENA CAPITAL CORPORATION By:   /s/ Michael A. Angerthal Name:   Michael A.
Angerthal Title:   Executive Vice President & Chief Financial Officer RUTHERFORD
FINANCIAL CORPORATION By:   /s/ David Hanley Name:   David Hanley Title:   Vice
President & Treasurer SCM ADVISORS LLC By:   /s/ Michael A. Angerthal Name:  
Michael A. Angerthal Title:   Senior Vice President & Chief Financial Officer
VIRTUS INVESTMENT ADVISERS, INC. By:   /s/ Michael A. Angerthal Name:   Michael
A. Angerthal Title:   Executive Vice President & Chief Financial Officer VIRTUS
PARTNERS, INC. By:   /s/ Michael A. Angerthal Name:   Michael A. Angerthal
Title:   Executive Vice President, Chief Financial Officer

 

Virtus Investment Partners, Inc. Security Agreement

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

ZWEIG ADVISERS, LLC By:   /s/ Michael A. Angerthal Name:   Michael A. Angerthal
Title:   Executive Vice President & Chief Financial Officer

 

Virtus Investment Partners, Inc. Security Agreement

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

THE BANK OF NEW YORK MELLON, as Administrative Agent By:   /s/ Richard G. Shaw
Name:   Richard G. Shaw Title:   Vice President

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE I

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF SUBSIDIARY GUARANTORS AND ADDRESS FOR NOTICES

 

Subsidiary Guarantor

  

Address

Duff & Phelps Investment Management Co.

  

200 S. Wacker Drive, Suite 500

Chicago, IL 60606

Attention: Chief Compliance Officer

 

with a copy to:

 

Virtus Investment Partners, Inc.

100 Pearl Street

Hartford, CT 06103

Attn.: Legal Counsel

Engemann Asset Management

  

c/o Virtus Investment Partners, Inc.

100 Pearl Street

Hartford, CT 06103

Attn.: Legal Counsel

Euclid Advisors LLC

  

900 Third Avenue

New York, NY 10022

Attention: Chief Compliance Officer

 

with a copy to:

 

Virtus Investment Partners, Inc.

100 Pearl Street

Hartford, CT 06103

Attn.: Legal Counsel

Kayne Anderson Rudnick Investment Management, LLC

  

1800 Avenue of the Stars

2nd Floor

Los Angeles, CA 90067

Attention: Chief Compliance Officer

 

with a copy to:

 

Virtus Investment Partners, Inc.

100 Pearl Street

Hartford, CT 06103

Attn.: Legal Counsel

Pasadena Capital Corporation

  

c/o Virtus Investment Partners, Inc.

100 Pearl Street

Hartford, CT 06103

Attn.: Legal Counsel

 

Virtus Investment Partners, Inc. Security Agreement

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

Rutherford Financial Corporation

  

c/o Virtus Investment Partners, Inc.

100 Pearl Street

Hartford, CT 06103

Attn.: Legal Counsel

SCM Advisors LLC

  

909 Montgomery Street

5th Floor

San Francisco, CA 94133

Attention: Chief Compliance Officer

 

with a copy to:

 

Virtus Investment Partners, Inc.

100 Pearl Street

Hartford, CT 06103

Attn.: Legal Counsel

Virtus Investment Advisers, Inc.

  

100 Pearl Street

Hartford, CT 06103

Attn.: Legal Counsel

Virtus Partners, Inc.

  

100 Pearl Street

Hartford, CT 06103

Attn.: Legal Counsel

Zweig Advisers, LLC

  

900 Third Avenue

New York, NY 10022

Attention: Chief Compliance Officer

 

with a copy to:

 

Virtus Investment Partners, Inc.

100 Pearl Street

Hartford, CT 06103

Attn.: Legal Counsel

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.1(a)(i)

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF CHIEF EXECUTIVE OFFICES, JURISDICTIONS OF ORGANIZATION,

FEDERAL EMPLOYER IDENTIFICATION NUMBERS AND COMPANY

ORGANIZATION NUMBERS

 

Name

   Jurisdiction
of Formation    Chief Executive Office    EIN    Co. Org.
No.

Virtus Investment Partners, Inc.

   Delaware    100 Pearl Street

Hartford, CT 06103

   26-3962811    4607257

Duff & Phelps Investment Management Co.

   Illinois    200 S. Wacker Drive, Suite

500

Chicago, IL 60606

   36-3027981    51781538

Engemann Asset Management

   California    909 Montgomery Street, 5th

Floor

San Francisco, CA 94133

   95-2755531    C0643640

Euclid Advisors LLC

   New York    900 Third Ave.

New York, NY 10022

   13-3937581    None

Kayne Anderson Rudnick Investment Management, LLC

   California    1800 Ave. of the Stars, 2nd
Floor

Los Angeles, CA 90067

   95-4575414    199523710008

Pasadena Capital Corporation

   California    909 Montgomery Street, 5th

Floor

San Francisco, CA 94133

   95-4187880    C1625252

Rutherford Financial Corporation

   Pennsylvania    None; Mail

c/o Virtus Investment

Partners

100 Pearl Street

Hartford, CT 06103

   23-2335627    856971

SCM Advisors LLC

   California    909 Montgomery Street, 5th

Floor

San Francisco, CA 94133

   94-3239114    199536510001

 

Virtus Investment Partners, Inc. Security Agreement

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

Virtus Investment Advisers, Inc.

   Massachusetts    100 Pearl Street

Hartford, CT 06103

   04-2453743    042453743

Virtus Partners, Inc.

   Delaware    100 Pearl Street

Hartford, CT 06103

   95-4191764    2174528

Zweig Advisers, LLC

   Delaware    900 Third Ave.

New York, NY 10022

   13-4051439    3007878

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.1(a)(ii)

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF LEGAL AND OTHER NAMES

 

A. Exact Legal Names of Grantors.

 

  1. Virtus Investment Partners, Inc.

 

  2. Duff & Phelps Investment Management Co.

 

  3. Engemann Asset Management

 

  4. Euclid Advisors LLC

 

  5. Kayne Anderson Rudnick Investment Management, LLC

 

  6. Pasadena Capital Corporation

 

  7. Rutherford Financial Corporation

 

  8. SCM Advisors LLC

 

  9. Virtus Investment Advisers, Inc.

 

  10. Virtus Partners, Inc.

 

  11. Zweig Advisers, LLC

 

B. Other Names.

 

Grantor

  

Trade Name or other Name

Virtus Partners, Inc.

   Virtus Investment Partners

Engemann Asset Management

   Engemann Asset Management Co. (MN)

 

Virtus Investment Partners, Inc. Security Agreement

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

C. Prior Names of Grantors.

1. Set forth below is the name of each Grantor that changed its legal name
within the five (5) years immediately preceding the date hereof, together with a
list of each legal name used by such Grantor during such five (5) years and the
period of use thereof during such five (5) years:

 

Grantor

  

Former Name(s)

  

Period of Use

Virtus Investment Partners, Inc.    Virtus Holdings, Inc.    October 1, 2008 –
November 13, 2008 SCM Advisors LLC    Seneca Capital Management LLC    July 17,
1997 – February 1, 2007 Virtus Investment Advisers, Inc.    Phoenix Investment
Counsel, Inc.    March 1, 1982 – September 30, 2008 Virtus Partners, Inc.   
Phoenix Investment Partners, Ltd.    May 7, 1998 – September 30, 2008 Virtus
Partners, Inc.    Virtus Investment Partners, Inc.    October 1, 2008 – November
13, 2008 Zweig Advisers, LLC    Phoenix/Zweig Advisers LLC    May 1, 2000 –
September 30, 2008

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.1(a)(iii)

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF SECURITY AGREEMENTS

Guarantee and Collateral Agreement, dated as of December 31, 2008, made by
Virtus Investment Partners, Inc. and certain of its Subsidiaries in favor of
Phoenix Life Insurance Company. This agreement will be terminated as a condition
to closing and all security interests granted thereunder will be terminated.

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.1(a)(v)

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF LIENS ON COLLATERAL; LIST OF FINANCING STATEMENTS

All Collateral owned or rights in Collateral held by each Grantor or on its
behalf is owned or held by it or on its behalf free and clear of any Lien,
except for Liens expressly permitted by the Loan Documents, and those as set
forth below. All liens in favor of Phoenix Life Insurance Company (“Phoenix”)
and all related financing statements will be released and terminated as a
condition to closing.

 

Grantor

  

Jurisdiction

  

Current
Secured
Party of
Record

  

Filing Number

  

File Date

  

File Type

  

Collateral
Description

Virtus Investment Partners, Inc.

   DE-Secretary of State    Phoenix    90022894    01/05/2009    Original    All
assets

Duff & Phelps Investment Management Co.

   IL-Secretary of State    Phoenix    014259937    05/01/2009    Original   
All assets

Engemann Asset Management

   CA-Secretary of State    Phoenix    097195304896    05/01/2009    Original   
All assets

Euclid Advisors LLC

   NY-Dept. of State    Phoenix    200905010248804    05/01/2009    Original   
All assets

Kayne Anderson Rudnick Investment Management, LLC

   CA-Secretary of State    Phoenix    097195304775    05/01/2009    Original   
All assets

Pasadena Capital Corporation

   CA-Secretary of State    Phoenix    097195305281    05/01/2009    Original   
All assets

SCM Advisors LLC

   CA-Secretary of State    Phoenix    097195305160    05/01/2009    Original   
All assets

Seneca Capital Management LLC

   CA-Secretary of State    Konica Minolta Business Solutions U.S.A., Inc.   
057019859650    03/21/2005    Original    Equipment Lease covering identified
equipment    CA-Secretary of State    Toshiba Financial Services    067064659225
   03/31/2006    Original    Equipment Lease covering identified equipment

Virtus Investment Advisers, Inc.

   MA-Secretary of State    Phoenix    200972812920    05/01/2009    Original   
All assets

 

Virtus Investment Partners, Inc. Security Agreement

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

Grantor

  

Jurisdiction

  

Current
Secured
Party of
Record

  

Filing Number

  

File Date

  

File Type

  

Collateral
Description

   MA-Secretary of State    Phoenix    200972884800    05/06/2009    Amendment
   Name of Debtor corrected; spelling of Advisers corrected to “Advisers” from
“Advisors”.

Virtus Partners, Inc.

   DE-Secretary of State    Phoenix    90022936    01/05/2009    Original    All
assets

Zweig Advisers, LLC

   DE-Secretary of State    Phoenix    91375812    04/30/2009    Original    All
assets    DE-Secretary of State    Phoenix    91399101    05/04/2009   
Amendment    Name of Debtor corrected; spelling of Advisers corrected to
“Advisers” from “Advisors.”

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.1(a)(vii)

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF MATERIAL AUTHORIZATIONS

The following Grantors have federal investment adviser registrations that are
material to the business of the Borrower and the Subsidiaries, taken as a whole:

 

  1. Duff & Phelps Investment Management Co.

 

  2. Engemann Asset Management

 

  3. Euclid Advisors LLC

 

  4. Kane Anderson Rudnick Investment Management, LLC

 

  5. SCM Advisors LLC

 

  6. Virtus Investment Advisers, Inc.

 

  7. Zweig Advisers, LLC

 

B. The Grantors currently have the following foreign entity qualifications:

 

Company

   Jurisdiction Duff & Phelps Investment Management Co.    CT Kayne Anderson
Rudnick Investment Management, LLC    OH Virtus Investment Advisers, Inc.    CA
Virtus Investment Advisers, Inc.    CT Virtus Partners, Inc.    CT Zweig
Advisers, LLC    NY

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.1(a)(viii)

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF MATERIAL LICENSES

In the event that federal investment adviser registrations are excluded from the
Collateral pursuant to Section 1.3(c) of this Security Agreement, the following
federal investment adviser registrations are material to the business of the
Borrower and the Subsidiaries, taken as a whole:

 

  1. Duff & Phelps Investment Management Co.

 

  2. Engemann Asset Management

 

  3. Euclid Advisors LLC

 

  4. Kane Anderson Rudnick Investment Management, LLC

 

  5. SCM Advisors LLC

 

  6. Virtus Investment Advisers, Inc.

 

  7. Zweig Advisers, LLC

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.2

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF LOCATIONS OF EQUIPMENT AND INVENTORY

 

Loan Party

  

Locations

Virtus Investment Partners, Inc.   

100 Pearl Street

Hartford, CT 06103

Duff & Phelps Investment Management Co.    200 S. Wacker Drive, Suite 500
Chicago, IL 60606 Engemann Asset Management   

100 Pearl Street

Hartford, CT 06103

Euclid Advisors LLC   

900 Third Ave.

New York, NY 10022

Kayne Anderson Rudnick Investment Management, LLC   

1800 Avenue of the Stars, 2nd Floor

Los Angeles, CA 90067

Pasadena Capital Corporation   

100 Pearl Street

Hartford, CT 06103

Rutherford Financial Corporation   

100 Pearl Street

Hartford, CT 06103

SCM Advisors LLC    909 Montgomery Street, 5th Floor San Francisco, CA 94133
Virtus Investment Advisers, Inc.   

100 Pearl Street

Hartford, CT 06103

Virtus Partners, Inc.   

100 Pearl Street

Hartford, CT 06103

Zweig Advisers, LLC   

900 Third Ave.

New York, NY 10022

 

Virtus Investment Partners, Inc. Security Agreement

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

Set forth below is the name and address of each Person that has possession of
any property of any Loan Party:

 

LOAN PARTY

  

OTHER PERSON1

VIRTUS INVESTMENT PARTNERS, INC.   

THE PHOENIX COMPANIES, INC.

ONE AMERICAN ROW

HARTFORD, CT 06103

 

IRON MOUNTAIN

1100 KENNEDY ROAD

WINDSOR, CT 06095

DUFF & PHELPS INVESTMENT MANAGEMENT CO.   

THE PHOENIX COMPANIES, INC.

ONE AMERICAN ROW

HARTFORD, CT 06103

 

IRON MOUNTAIN

1301 S. ROCKWELL

CHICAGO, IL 60608

ENGEMANN ASSET MANAGEMENT   

THE PHOENIX COMPANIES, INC.

ONE AMERICAN ROW

HARTFORD, CT 06103

 

IRON MOUNTAIN

23475 EICHLER STREET

HAYWARD, CA 94545

 

DIGITAL SERVICES & SOFTWARE

120 TURNPIKE ROAD

SOUTHBOROUGH, MA 01772

EUCLID ADVISORS LLC   

THE PHOENIX COMPANIES, INC.

ONE AMERICAN ROW

HARTFORD, CT 06103

 

IRON MOUNTAIN

1100 KENNEDY ROAD

WINDSOR, CT 06095

 

1

All parties listed herein have possession solely of books and records, except
that The Phoenix Companies, Inc. also has possession of stock certificates
relating to shares of stock of certain Grantors that were pledged to Phoenix
Life Insurance Company in connection with the Loan Agreement, dated as of
December 31, 2008, by and between Phoenix Life Insurance Company and Virtus
Investment Partners, Inc. Such pledge is being terminated as a condition to
closing and such stock certificates will be delivered to the Administrative
Agent at closing with related undated stock powers.

 

Virtus Investment Partners, Inc. Security Agreement

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

LOAN PARTY

  

OTHER PERSON1

KAYNE ANDERSON RUDNICK INVESTMENT MANAGEMENT, LLC   

THE PHOENIX COMPANIES, INC.

ONE AMERICAN ROW

HARTFORD, CT 06103

 

IRON MOUNTAIN

23475 EICHLER STREET

HAYWARD, CA 94545

 

THE DATALOCK COMPANY

4881 145TH STREET

HAWTHORNE, CA 90250

PASADENA CAPITAL CORPORATION   

THE PHOENIX COMPANIES, INC.

ONE AMERICAN ROW

HARTFORD, CT 06103

 

IRON MOUNTAIN

23475 EICHLER STREET

HAYWARD, CA 94545

 

DIGITAL SERVICES & SOFTWARE

120 TURNPIKE ROAD

SOUTHBOROUGH, MA 01772

RUTHERFORD FINANCIAL CORPORATION    N/A SCM ADVISORS LLC   

THE PHOENIX COMPANIES, INC.

ONE AMERICAN ROW

HARTFORD, CT 06103

 

IRON MOUNTAIN

23475 EICHLER STREET

HAYWARD, CA 94545

 

DIGITAL SERVICES & SOFTWARE

120 TURNPIKE ROAD

SOUTHBOROUGH, MA 01772

 

Virtus Investment Partners, Inc. Security Agreement

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

LOAN PARTY

  

OTHER PERSON1

VIRTUS INVESTMENT ADVISERS, INC.   

THE PHOENIX COMPANIES, INC.

ONE AMERICAN ROW

HARTFORD, CT 06103

 

IRON MOUNTAIN

1100 KENNEDY ROAD

WINDSOR, CT 06095

VIRTUS PARTNERS, INC.   

THE PHOENIX COMPANIES, INC.

ONE AMERICAN ROW

HARTFORD, CT 06103

 

IRON MOUNTAIN

1100 KENNEDY ROAD

WINDSOR, CT 06095

ZWEIG ADVISERS, LLC   

THE PHOENIX COMPANIES, INC.

ONE AMERICAN ROW

HARTFORD, CT 06103

 

IRON MOUNTAIN

1100 KENNEDY ROAD

WINDSOR, CT 06095

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.4

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF INVESTMENT-RELATED PROPERTY

1. Issued and Outstanding Stock, Partnership Interests, Limited Liability
Company Membership Interests or Other Equity Interests of Each Grantor and
Record and Beneficial Owners Thereof:

 

Issuer

  

Certificate
No. (if
Applicable)

  

Registered
Owner

  

No. and Class of
Shares

  

% of Outstanding Equity
Interests of Class

DPCM Holdings, Inc.    5    Virtus Partners, Inc.    1,000 shares of Common
Stock    100% of issued and outstanding stock (one class – common stock) Duff &
Phelps Investment Management Co.    5    Virtus Partners, Inc.    900 shares of
Common Stock    100% of issued and outstanding stock (one class – common stock)
Engemann Asset Management    101    Pasadena Capital Corporation    60 shares of
Common Stock    100% of issued and outstanding stock (one class – common stock)
Euclid Advisors LLC    N/A    Zweig Advisers, LLC    100% membership interest   
100% membership interest Kayne Anderson Rudnick Investment Management, LLC   
N/A    Virtus Partners, Inc.    100% membership interest    100% membership
interest Pasadena Capital Corporation    1001    Virtus Partners, Inc.    100
shares of Common Stock    100% of issued and outstanding stock (one class –
common stock) Rutherford Financial Corporation    V-41    Virtus Partners, Inc.
   338,458 shares of voting common stock    100% of issued and outstanding stock
SCM Advisors LLC    N/A    Virtus Partners, Inc.    100% membership interest   
100% membership interest Virtus Alternative Investment Advisers, Inc.    2   
Virtus Partners, Inc.    100 shares of Common Stock    100% of issued and
outstanding stock (one class – common stock)

 

Virtus Investment Partners, Inc. Security Agreement

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

Virtus Partners, Inc.    5    Virtus Investment Partners, Inc.    1,000 shares
of Common Stock    100% of issued and outstanding stock (one class – common
stock) VP Distributors, Inc.    8    Virtus Partners, Inc.    5,000 shares of
Common stock    100% of issued and outstanding stock (one class – common stock)
Zweig Advisers, LLC    N/A    Virtus Partners, Inc.    100% membership interest
   100% membership interest

 

2. Excluded Investments:

(a) The issuer of the following assets has appointed American Stock Transfer &
Trust Company (“AST”) as the registrar and/or transfer agent for its securities
and AST, as agent of such issuer, lists the indicated Loan Party as the owner of
such securities:

 

Issuer

  

Registered Owner

  

Certificated?

  

No. of Shares

DTF Tax-Free Income Inc.    Virtus Partners, Inc.1   

8,000 Certificated

13,838.82 Uncertificated

   21,838.82

(b) The issuer of the following assets has appointed The Bank of New York Mellon
(“BNYM”) as the registrar and/or transfer agent for its securities and BNYM, as
agent of such issuer, lists the indicated Loan Party as the owner of such
securities:

 

Issuer

  

Registered Owner

   Certificated?    No. of Shares Duff & Phelps Utility and Corporate Bond Trust
   Virtus Partners, Inc.2    8,000
Certificated

21,678.4604
Uncertificated

   29,678.4604 DNP Select Income Fund    Virtus Partners, Inc. 2    12,000
Certificated

105,264.2524
Uncertificated

   117,264.2524

 

1

Successor to Duff & Phelps Corporation as outlined in the long-form good
standing certificate dated August 5, 2009, issued by the Secretary of State and
delivered to the Administrative Agent pursuant to Section 5.1(d) of the Credit
Agreement.

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.4 (a)(iv)

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF UNCERTIFICATED PLEDGED EQUITY INTERESTS NOT SUBJECT TO

BLOCKED ACCOUNTS

None

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.4(a)(v)

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF PERSONS WITH CONTROL OVER INVESTMENT-RELATED PROPERTY

The following Investment-Related Property is currently held by Phoenix Life
Insurance Company as collateral to secure the obligations of the Grantors under
that certain Loan Agreement, dated as of December 31, 2008, by and between
Phoenix Life Insurance Company and Virtus Investment Partners, Inc. and that
certain Guarantee and Collateral Agreement, dated as of December 31, 2008, by
and between Phoenix Life Insurance Company and Virtus Investment Partners, Inc.
The security interest of Phoenix Life Insurance Company is being released as a
condition to closing and the certificates will be pledged to The Bank of New
York Mellon, as Administrative Agent, as a condition precedent to the closing.

 

1. Stock Certificate No. 5 registered in the name of Virtus Partners, Inc.
representing 1,000 shares of Common Stock, no par value, of DPCM Holdings, Inc.

 

2. Stock Certificate No. 5 registered in the name of Virtus Partners, Inc.
representing 900 shares of Common Stock, par value $100.00 per share, of Duff &
Phelps Investment Management Co.

 

3. Stock Certificate No. 101 registered in the name of Pasadena Capital
Corporation representing 60 shares of Common Stock, par value $100.00 per share,
of Engemann Asset Management

 

4. Stock Certificate No. 1001 registered in the name of Virtus Partners, Inc.
representing 100 shares of Common Stock, no par value, of Pasadena Capital
Corporation

 

5. Stock Certificate No. 5 registered in the name of Virtus Investment Partners,
Inc. representing 1,000 shares of Common Stock, par value $0.01 per share, of
Virtus Partners, Inc.

 

6. Stock Certificate No. 2 registered in the name of Virtus Partners, Inc.
representing 100 shares of Common Stock, no par value, of Virtus Alternative
Investment Advisers, Inc.

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.5

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF LETTERS OF CREDIT

None

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.6

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF INTELLECTUAL PROPERTY

Patents

None.

Patent Licenses

None.

Trademarks

 

Grantor

  

Mark

  

Reg. No.

  

Reg. Date

  

Serial No.

  

Filing Date

  

Status

Virtus Partners, Inc.    OAKHURST    Not Available   

Not

Available

   77505130    June 23, 2008    Non-final action mailed – Request for more info.
and/or making initial refusal – no final determination made Virtus Partners,
Inc.    KNOW MORE. GUIDE RESPONSIBLY. INVEST WISELY.    2857446    June 29, 2008
   76489221    February 11, 2003    Registered Virtus Partners, Inc.   
INVESTORS BEHAVING BADLY    2687213    February 11, 2003    76192107   
January 10, 2001    Registered Virtus Partners, Inc.    COMMITTED TO INVESTOR
SUCCESS    3061436    February 28, 2006    76159809    November 6, 2000   
Registered Virtus Partners, Inc.    GOODWIN    2384711    September 12, 2000   
75564417    October 5, 1998    Section 8 and 15 affidavits accepted and
acknowledged Virtus Partners, Inc.    DUFF & PHELPS INVESTMENT MANAGEMENT CO.   
1579407    January 23, 1990    73790727    April 3, 1989    Renewed

 

Virtus Investment Partners, Inc. Security Agreement

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

Virtus Partners, Inc.    DUFF & PHELPS CREDIT RATING CO.    1575504   
January 2, 1990    73790725    April 3, 1989    Renewed Engemann Asset
Management    ENGEMANN    2984642    August 16, 2005    76572872    January 30,
2004    Registered Kayne Anderson Rudnick Investment Management LLC    QUALITY
AT A REASONABLE PRICE    2693264    March 4, 2003    76422448    June 19, 2002
   Registered SCM Advisors LLC    SCM    2370812    July 25, 2000    75732995   
June 21, 1999    Section 8 and 15 affidavits accepted & acknowledged SCM
Advisors LLC    SCM    2397440    October 24, 2000    75732994    June 21, 1999
   Registered

Trademark Licenses

 

1. The Loan Parties do not have exclusive use of the name “Duff & Phelps.”
Pursuant to that certain Name Use Agreement dated October 31, 1994, Duff &
Phelps Credit Rating Co. was granted the right to use this name and related
intellectual property.

 

2. The Loan Parties do not have exclusive use of the name “SCM.” Pursuant to
that certain Co-Existence Agreement dated January 31, 2007, SCM Advisors, LP was
afforded certain rights regarding this name.

Copyrights

None.

 

Virtus Investment Partners, Inc. Security Agreement

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

Copyright Licenses

 

Licenser

  

Licensee

  

Date of License Agreement

  

Expiration

Date of

License

  

Copyrights Licensed

Stephen D.

Gresham

   Virtus Partners, Inc.    December 9, 2002, as amended and restated on
November 20, 2006   

Not

Applicable

   First Edition of the book entitled “The Managed Account Handbook: How to
Build Your Financial Advisor Practice Using Separately Managed Accounts” (Reg.
No. TX-5-665-156, published October 16, 2002, registered December 2, 2002)

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.7

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF MATERIAL COMMERCIAL TORT CLAIMS

None.

 

Virtus Investment Partners, Inc. Security Agreement

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

SCHEDULE 3.8

TO SECURITY AGREEMENT

Dated as of September 1, 2009

LIST OF DEPOSIT ACCOUNTS

 

Name of Account Holder

  

Name and Address of Depositary Institution

  

Account Number

Virtus Investment Partners, Inc.   

The Bank of New York Mellon

One Wall Street

New York, New York 10286

   8900726881 Duff & Phelps Investment Management Co.   

Wachovia Bank

401 Linden St.

Mail Code: NC6956

Attn: Marcia Allgood

Winston Salem, NC 27101

   2000028307767 Engemann Asset Management   

Wachovia Bank

401 Linden St.

Mail Code: NC6956

Attn: Marcia Allgood

Winston Salem, NC 27101

   2000028307796 Euclid Advisors LLC   

Wachovia Bank

401 Linden St.

Mail Code: NC6956

Attn: Marcia Allgood

Winston Salem, NC 27101

   2000028307783 Kayne Anderson Rudnick Investment Management, LLC   

U.S. Bank National Association

633 W. 5th St, Fl. 25

Los Angeles, CA 90071

   265701082793 Kayne Anderson Rudnick Investment Management, LLC   

U.S. Bank National Association

633 W. 5th St, Fl. 25

Los Angeles, CA 90071

   165706247815 Kayne Anderson Rudnick Investment Management, LLC   

U.S. Bank National Association

633 W. 5th St, Fl. 25

Los Angeles, CA 90071

   165706248037 SCM Advisors LLC   

Wachovia Bank

401 Linden St.

Mail Code: NC6956

Attn: Marcia Allgood

Winston Salem, NC 27101

   2000028307806

 

Virtus Investment Partners, Inc. Security Agreement

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

Virtus Investment Advisers, Inc.   

Wachovia Bank

401 Linden St.

Mail Code: NC6956

Attn: Marcia Allgood

Winston Salem, NC 27101

   2000028307709 Virtus Partners, Inc.   

Wachovia Bank

401 Linden St.

Mail Code: NC6956

Attn: Marcia Allgood

Winston Salem, NC 27101

   2000028307725 Virtus Partners, Inc.   

Wachovia Bank

401 Linden St.

Mail Code: NC6956

Attn: Marcia Allgood

Winston Salem, NC 27101

   2000041710137 Zweig Advisers, LLC   

Wachovia Bank

401 Linden St.

Mail Code: NC6956

Attn: Marcia Allgood

Winston Salem, NC 27101

   2000028307738

 

Virtus Investment Partners, Inc. Security Agreement

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

EXHIBIT A

TO SECURITY AGREEMENT

Dated as of September 1, 2009

FORM OF SUPPLEMENT

SUPPLEMENT NO.     , dated as of                         , to the Security
Agreement, dated as of September 1, 2009, among VIRTUS INVESTMENT PARTNERS,
INC., a Delaware corporation (the “Borrower”), the subsidiaries of the Borrower
party thereto, and THE BANK OF NEW YORK MELLON, as Administrative Agent under
the Credit Agreement referred to in the next paragraph (as amended, supplemented
or otherwise modified from time to time, the “Security Agreement”).

Reference is made to the Credit Agreement, dated as of September 1, 2009, among
the Borrower, the Lenders from time to time party thereto and The Bank of New
York Mellon, as Administrative Agent thereunder (as amended, supplemented or
otherwise modified from time to time, the “Credit Agreement”). Capitalized terms
(and the term “subsidiary”) used herein and not defined herein shall have the
meanings assigned to such terms in the Credit Agreement and the Security
Agreement.

The Grantors have entered into the Security Agreement in order to induce the
Credit Parties to enter into the Credit Agreement. Article 10 of the Security
Agreement provides that additional Subsidiaries may become Grantors under the
Security Agreement by execution and delivery of an instrument in the form of
this Supplement. The undersigned Subsidiary (the “New Grantor”) is executing
this Supplement in accordance with the requirements of the Credit Agreement to
become a Grantor under the Security Agreement in order to induce the Lenders to
make additional Revolving Loans and as consideration for Revolving Loans
previously made.

Accordingly, the Administrative Agent and the New Grantor hereby agree as
follows:

1. In accordance with Article 10 of the Security Agreement, the New Grantor by
its signature below becomes a Grantor under the Security Agreement with the same
force and effect as if originally named therein as a Grantor, and the New
Grantor hereby agrees to all the terms and provisions of the Security Agreement
applicable to it as a Grantor thereunder. In furtherance of the foregoing, the
New Grantor, as security for the payment and performance in full of the Secured
Obligations, does hereby create and grant, subject to the terms and conditions
of the Security Agreement, to the Administrative Agent (and its successors and
assigns), for the benefit of the Secured Parties (and their successors and
assigns), a security interest in and lien on all of the New Grantor’s right,
title and interest in and to the Collateral (as defined in the Security
Agreement) owned or held by or on behalf of the New Grantor. Each reference to a
“Grantor” in the Security Agreement shall be deemed to include the New Grantor.
The Security Agreement is hereby incorporated herein by reference.

2. The New Grantor represents and warrants to the Administrative Agent and the
other Secured Parties that (i) this Supplement has been duly authorized,
executed and delivered by it and constitutes its legal, valid and binding
obligation, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, insolvency, reorganization,

 

Virtus Investment Partners, Inc. Security Agreement

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

moratorium or other similar laws affecting creditors’ rights generally, (ii) set
forth on the Schedules attached hereto are true and complete schedules of all of
the information that would have been required to have been delivered by or on
behalf of the New Grantor pursuant to the Security Agreement and the Schedules
thereto if the New Grantor had been originally named in the Security Agreement,
and (iii) the representations and warranties made by it as a Grantor under the
Security Agreement are true and correct on and as of the date hereof based upon
the applicable information referred to in clause (ii) of this Section.

3. This Supplement may be executed in counterparts (and by each party hereto on
a different counterpart), each of which shall constitute an original, but both
of which, when taken together, shall constitute but one contract. This
Supplement shall become effective when the Administrative Agent shall have
received counterparts of this Supplement that, when taken together, bear the
signatures of the New Grantor and the Administrative Agent. Delivery of an
executed counterpart of this Supplement by facsimile transmission shall be as
effective as delivery of a manually executed counterpart of this Supplement.

4. Except as expressly supplemented hereby, the Security Agreement shall remain
in full force and effect.

5. THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK.

6. In the event any one or more of the provisions contained in this Supplement
should be held invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein and in
the Security Agreement shall not in any way be affected or impaired thereby (it
being understood that the invalidity of a particular provision in a particular
jurisdiction shall not in and of itself affect the validity of such provision in
any other jurisdiction). The parties hereto shall endeavor in good faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to that
of the invalid, illegal or unenforceable provisions.

7. All communications and notices hereunder shall be in writing and given as
provided in Article 12 of the Security Agreement.

8. The New Grantor agrees to reimburse the Administrative Agent for its
reasonable out-of-pocket expenses in connection with this Supplement, including
the reasonable fees, disbursements and other charges of counsel for the
Administrative Agent.

[Signature page follows]

 

- 2 -

Virtus Investment Partners, Inc. Security Agreement

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

IN WITNESS WHEREOF, the New Grantor and the Administrative Agent have duly
executed this Supplement No.      to the Security Agreement as of the day and
year first above written.

 

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

 

THE BANK OF NEW YORK MELLON, as Administrative Agent By:     Name:     Title:  
 

[ATTACH SCHEDULES CORRESPONDING TO THE

SCHEDULES TO THE SECURITY AGREEMENT]

 

- 3 -

Virtus Investment Partners, Inc. Security Agreement

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

EXHIBIT B

TO SECURITY AGREEMENT

Dated as of September     , 2009

FORM OF ISSUER’S ACKNOWLEDGMENT

The undersigned (the “Issuer”) hereby [acknowledges receipt of a copy of that
certain Security Agreement dated as of September 1, 2009 (as amended, amended
and restated, supplemented or otherwise modified from time to time, the
“Security Agreement”), among Virtus Investment Partners, Inc., the other
Grantors party thereto and The Bank of New York Mellon, as Administrative Agent
(in such capacity and together with any successors in such capacity, the
“Administrative Agent”). Capitalized terms used but not otherwise defined herein
shall have the meanings assigned to such terms in the Security Agreement).

The Issuer is the issuer of [describe Pledged Stock] owned of record by [name of
grantor] (the “Grantor”), which Pledged Stock is an [uncertificated security],
[uncertificated limited liability company interest] [uncertificated partnership
interest]. The Issuer hereby (i) agrees, with respect to such Pledged Stock,
that it will comply with any and all instructions originated by the
Administrative Agent without further consent by the Grantor and that it will not
comply with instructions with respect to such Pledged Stock originated by any
other person other than a court of competent jurisdiction and (ii) waives any
right or requirement at any time hereafter to receive a copy of the Security
Agreement in connection with the registration of any Pledged Collateral
thereunder in the name of the Administrative Agent or its nominees or the
exercise of voting rights by the Administrative Agent or its nominees.

 

[                                                         ] By:       Name:  
Title:

 

Virtus Investment Partners, Inc. Security Agreement

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

EXHIBIT C

TO SECURITY AGREEMENT

Dated as of September     , 2009

FORM OF SPECIAL POWER OF ATTORNEY

Dated as of                     , 200    

STATE OF                                     )

                                                         )

COUNTY OF                                 )

KNOW ALL PERSONS BY THESE PRESENTS, THAT [Name of Grantor] a
                             (the “Grantor”), pursuant to that certain Security
Agreement, dated as of September 1, 2009 (as amended, supplemented or otherwise
modified from time to time, the “Security Agreement”), among the Grantor, other
entities party thereto from time to time and The Bank of New York Mellon, as
Administrative Agent (in such capacity, the “Administrative Agent”) for the
financial institutions (collectively, the “Lenders”) which are from time to time
parties to that certain Credit Agreement, dated as of September 1, 2009 (as
amended, supplemented or otherwise modified from time to time, the “Credit
Agreement”), among Virtus Investment Partners, Inc., the Lenders party thereto,
and The Bank of New York Mellon, as Administrative Agent, hereby appoints and
constitutes the Administrative Agent its true and lawful attorney-in-fact, with
full power of substitution, and with full power and authority to perform the
following acts on behalf of the Grantor:

1. For the purpose of (a) assigning, selling, licensing or otherwise disposing
of all right, title and interest of the Grantor in and to (i) any letters patent
of the United States of America or any other country, all registrations and
recordings thereof and all applications for letters patent of the United States
of America or any other country, including registrations, recordings and pending
applications in the United States Patent and Trademark Office or any similar
offices in the United States of America or any other country, (ii) any
inventions and improvements described and claimed therein, including the right
to make, use and/or sell the inventions disclosed or claimed therein, (iii) any
reissues, continuations, divisions, continuations in part, renewals or
extensions thereof and amendments thereto, and the inventions disclosed or
claimed therein, and (iv) any income, fees, royalties, damages, claims and
payments now or hereafter due and/or payable thereunder and with respect thereto
(items (i) through and including (iv) being referred to herein as the “Patents”)
and (b) for the purpose of the recording, registering and filing of, or
accomplishing any other formality with respect to, the foregoing, to execute and
deliver any and all agreements, documents, instruments of assignment or other
papers necessary or advisable to effect such purpose.

2. For the purpose of (a) assigning, selling, licensing or otherwise disposing
of all right, title and interest of the Grantor in and to (i) any trademarks,
service marks, trade names, corporate names, company names, business names,
fictitious business names, trade styles, trade dress, logos, other source or
business identifiers, uniform resource locations (URL’s), domain names, designs
and general intangibles of like nature, now existing or hereafter adopted or
acquired, all registrations and recordings thereof, and all registration and
recording applications

 

Virtus Investment Partners, Inc. Security Agreement

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

filed in connection therewith, including registrations and registration
applications in the United States Patent and Trademark Office or any similar
offices in the United States of America or any other country, and reissues,
continuations, extensions and renewals thereof and amendments thereto,
(ii) goodwill associated therewith or symbolized by any of the foregoing,
(iii) income, fees, royalties, damages and payments now and hereafter due and/or
payable thereunder and with respect thereto and (iv) all other assets, rights
and interests that uniquely reflect or embody such goodwill (items (i) through
and including (iv) being referred to herein as the “Trademarks”) and (b) for the
purpose of the recording, registering and filing of, or accomplishing any other
formality with respect to, the foregoing, to execute and deliver any and all
agreements, documents, instruments of assignment or other papers necessary or
advisable to effect such purpose.

3. For the purpose of (a) assigning, selling, licensing or otherwise disposing
of all right, title and interest of the Grantor in and to (i) any copyright
rights in any work subject to the copyright laws of the United States of America
or any other country, whether as author, assignee, transferee or otherwise,
(ii) any registrations and applications for registration of any such copyright
in the United States of America or any other country, including registrations,
recordings, supplemental registrations and pending applications for registration
in the United States Copyright Office or any similar offices in the United
States of America or any other country, (iii) any rights and privileges arising
under applicable law with respect to such the of such copyrights, (iv) reissues,
renewals, continuations and extensions thereof and amendments thereto, and
(v) income, fees, royalties, damages, claims and payments now or hereafter due
and/or payable with respect thereto, including damages and payments for past,
present or future infringements thereof (items (i) through and including
(iv) being referred to herein as the “Copyrights”), and (b) for the purpose of
the recording, registering and filing of, or accomplishing any other formality
with respect to, the foregoing, to execute and deliver any and all agreements,
documents, instruments of assignment or other papers necessary or advisable to
effect such purpose.

4. For the purpose of evidencing and perfecting the Administrative Agent’s
interest in any Patent, Trademark or Copyright not previously assigned to the
Administrative Agent as security, or in any Patent, Trademark or Copyright,
which the Grantor may acquire from a third party, and for the purpose of the
recording, registering and filing of, or accomplishing any other formality with
respect to, the foregoing, to execute and deliver any and all agreements,
documents, instruments of assignment or other papers necessary or advisable to
effect such purpose.

5. To execute any and all documents, statements, certificates or other papers
necessary or advisable in order to obtain the purposes described above as the
Administrative Agent may in its sole discretion determine.

 

Virtus Investment Partners, Inc. Security Agreement

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

This power of attorney is made pursuant to the Security Agreement and takes
effect solely for the purposes thereof and is subject to the terms and
conditions thereof and may not be revoked until termination of the Security
Agreement as provided therein.

 

[Name of Grantor] By:     Name:     Title:    

STATE OF NEW YORK)

                                           )    ss:

COUNTY OF NEW YORK)

On this          day of             , 200    , before me personally appeared
                             to me known who, being by me duly sworn, did depose
and say that he is a [Title] of [Name of Grantor], the [corporation/limited
liability company] described herein and which executed the foregoing instrument,
and that he signed his name thereto pursuant to the authority granted by such
corporation.

 

           Notary Public

 

Virtus Investment Partners, Inc. Security Agreement

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

EXHIBIT D

TO SECURITY AGREEMENT

Dated as of September     , 2009

FORM OF LETTER AGREEMENT RELATING TO

HEDGING AGREEMENTS AND CASH MANAGEMENT AGREEMENTS

 

[Date]

The Bank of New York Mellon, as Administrative Agent

One Wall Street

New York, New York 10286

Attention:                                                             

                  Agency Function Administration

The Bank of New York, as Administrative Agent

One Wall Street

New York, New York 10286

Attention: Richard G. Shaw

                  Vice President

Reference is made to the Credit Agreement, dated as of September 1, 2009, among
Virtus Investment Partners, Inc., a Delaware corporation (the “Borrower”), the
Lenders party thereto, and The Bank of New York Mellon as Administrative Agent
(as the same may be amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”) and the Guarantee Documents and the Security
Documents (each as defined in the Credit Agreement). Capitalized terms used
herein and not otherwise defined herein and the term “subsidiary” shall have the
meanings assigned to such terms in the Credit Agreement.

The undersigned is a Lender or an Affiliate of a Lender and is entering into [an
Interest Rate Protection Agreement or Hedging Agreement designed to hedge risk
in respect of currency fluctuations (the “Hedging Agreement”) with the Borrower
and desires that such Hedging Agreement be a Secured Hedging Agreement as
defined in the Security Agreement] [a Cash Management Agreement with [name of
Loan Party] and desires that such Cash Management Agreement be a Secured Cash
Management Agreement as defined in the Security Agreement]3. Accordingly, the
undersigned hereby (i) appoints the Administrative Agent as its agent under the
applicable Loan Documents and (ii) agrees to be bound by the provisions of
Sections 10.3, 10.9 and 10.13 of the Credit Agreement and the provisions of the
applicable Loan Documents, including, without limitation, the provisions of
Article 9 of the Security Agreement.

 

3

Delete inapplicable provision.

 

Virtus Investment Partners, Inc. Security Agreement

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

Very truly yours, [NAME OF COUNTERPARTY] By:     Name:     Title:    

 

Virtus Investment Partners, Inc. Security Agreement