Exhibit 10.3
 
PLEDGE AGREEMENT

THIS PLEDGE AGREEMENT (this “Pledge Agreement”), dated as of January 25, 2008,
among MAXIMUS, INC., a Virginia corporation (the “Borrower”), the Subsidiaries
of the Borrower hereafter a party hereto (each a “Subsidiary Pledgor” and
collectively the “Subsidiaries Pledgors”; Borrower, each Subsidiary Pledgor and
each other Subsidiary hereafter becoming a party hereto shall be collectively
known as the “Pledgors”, and individually as “Pledgor”), in favor of SUNTRUST
BANK, a Georgia banking corporation, as Administrative Agent (the
“Administrative Agent”), on its behalf and on behalf of the other Secured
Parties (as defined below).

WITNESSETH:

WHEREAS, pursuant to the Revolving Credit Agreement, dated as of the date
hereof, by and among the Borrower, the Administrative Agent, the banks and
lending institutions (the “Lenders”) from time to time party thereto, and
SunTrust Bank, as Issuing Bank and as Swingline Lender (as amended, restated,
supplemented, or otherwise modified from time to time, the “Credit Agreement”).

WHEREAS, the Lenders have agreed to establish a revolving credit facility to the
Borrower;

WHEREAS, it is a condition precedent to the obligations of the Administrative
Agent, the Issuing Bank, the Swingline Lender, and the Lenders under the Credit
Agreement that each Pledgor grant to Administrative Agent a security interest in
all of its Pledged Collateral (as defined below), and each Pledgor wishes to
fulfill said condition precedent;

NOW, THEREFORE, in order to induce Lenders to extend the Loans and the Issuing
Bank to issue Letters of Credit and to make the financial accommodations as
provided for in the Credit Agreement and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:

1. Defined Terms.  All capitalized terms used but not otherwise defined herein
have the meanings given to them in the Credit Agreement.

“Excluded Property” shall mean (i) any contract, General Intangible, property
right or agreement to which any Pledgor is a party or any of its rights or
interests thereunder if and only for so long as the grant of a security interest
hereunder shall constitute or result in a material breach or default under any
such contract, General Intangible, property right or agreement or would give
rise to a right to terminate any such General Intangible (other than to the
extent that any such term would be rendered ineffective pursuant to Sections
9-406, 9-407, 9-408, or 9-409 of the UCC of any relevant jurisdiction or any
other applicable law or principles of equity); provided, however, that such
security interest shall attach immediately to any portion of such contract,
General Intangible, property rights or agreement that does not result in any of
the consequences specified above, (ii) any rights or property to the extent that
any valid enforceable law or regulation applicable to such rights or property
prohibits the creation of a security interest therein, (iii) any Capital Stock
to the extent it represents more than 65% of the Capital Stock of any Foreign
Subsidiary.

 
 

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“Foreign Corporate Documents”  means (i) the Shareholders Agreement, dated as of
____, 2005, by and between the Borrower and ORS and (ii) the Articles of
Association of Israel Workforce Solutions Ltd., dated as of _______, 2005, as
executed by the Borrower and ORS.

“ORS” means ORS Overseas Representation Services Ltd..

"Pledged Membership Interests" means the Capital Stock described on Part B of
Schedule I attached hereto other than Excluded Property.

"Pledged Shares" means the Capital Stock described on Part A of Schedule I
attached hereto other than Excluded Property.

“Secured Obligations” shall mean (i) with respect to the Borrower, all
Obligations of the Borrower, (ii) with respect to any other Pledgor , all
Guaranteed Obligations (as such term is defined in the Subsidiary Guaranty) of
each such Pledgor.

"Secured Parties" means the Administrative Agent, the Lenders, the Specified
Hedge Providers and the Specified Treasury Management Providers.  "Secured
Party" means any of the Secured Parties individually.

“Specified Hedge Provider” means each party to a Hedging Transaction incurred to
limit interest rate or fee fluctuation with respect to the Loans and Letters of
Credit if at the date of entering into such Hedging Transaction such person was
a Lender or an Affiliate of a Lender and such person executes and delivers to
the Administrative Agent a letter agreement in form and substance acceptable to
the Administrative Agent pursuant to which such person (i) appoints the
Administrative Agent as its agent under the applicable Loan Documents and (ii)
agrees to be bound by the provisions of Article 9 and 10 of the Credit
Agreement.
 
“Specified Treasury Management Provider” means each Lender or an Affiliate of a
Lender that offers products of the type described in the definition of “Treasury
Management Obligations” contained in the Credit Agreement and such person
executes and delivers to the Administrative Agent a letter agreement in form and
substance acceptable to the Administrative Agent pursuant to which such person
(i) appoints the Administrative Agent as its agent under the applicable Loan
Documents and (ii) agrees to be bound by the provisions of Article 9 and 10 of
the Credit Agreement.
 
"Termination Time" means the time that all Secured Obligations (other than (i)
Obligations related to Hedging Obligations except to the extent due on or prior
to the Termination Time, (ii) Obligations related to Treasury Management
Services except to the extent due on or prior to the Termination Time and (iii)
Unasserted Contingent Obligations) have been paid in full in cash, all
Commitments have been terminated or otherwise reduced to zero and all LC
Exposure has either been cash collateralized or back stopped by one or more
letters of credit in form acceptable to the Issuing Lender and in an amount
equal to 103% of such LC Exposure.
 
 
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2. Pledge.  Each Pledgor hereby pledges to the Administrative Agent, for its
benefit and the benefit of Secured Parties and grants to the Administrative
Agent, for its benefit and the benefit of the Secured Parties, a first priority
security interest in all of such Pledgor’s right, title and interest in, to and
under the following property, whether now owned by or owing to, or hereafter
acquired by or arising in favor of such Pledgor (collectively, the “Pledged
Collateral”):

(a) The Pledged Shares and the certificates representing the Pledged Shares,
and, except as expressly provided for in Section 8 hereof, all dividends, 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 the Pledged Shares;

(b) Any Capital Stock acquired by any Pledgor or such Pledgor’s designees with
respect to, incident to or in lieu of the Pledged Shares or with respect to,
incident to or in lieu of the Pledged Collateral (x) due to any dividend,
stock-split, stock dividend or distribution on dissolution, or partial or total
liquidation, or for any other reason, (y) in connection with a reduction of
capital, capital surplus or paid-in-surplus or (z) in connection with any
spin-off, split-off, reclassification, readjustment, merger, consolidation, sale
of assets, combination of shares or any other plan of distribution affecting of
the those companies listed on Schedule I;

(c) Any subscription or other rights or options issued in connection with the
Pledged Shares, and, if exercised by any Pledgor, all new Capital Stock so
acquired by such Pledgor, which shall promptly be assigned and delivered to the
Administrative Agent and held under the terms of this Pledge Agreement in the
same manner as the Pledged Shares originally pledged hereunder;

(d) Any Capital Stock acquired by any Pledgor after the date hereof, which shall
promptly be delivered to the Administrative Agent and held under the terms of
this Pledge Agreement in the same manner as the Pledged Shares originally
pledged hereunder;

(e) Any and all proceeds, monies, income and benefits arising from or by virtue
of, and all dividends and distributions (cash or otherwise) payable or
distributable with respect to, all or any of the Pledged Shares or other
securities and rights and interests described in this Section 2, except as
expressly provided for in Section 8 hereof;

(f) The Pledged Membership Interests, if any, and any certificates at any time
representing the Pledged Membership Interests, it being understood that the
Pledged Membership Interests are, as of the date hereof, uncertificated, and all
cash, securities, dividends, rights, and other property at any time and from
time to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of the Pledged Membership Interests;

 
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(g) All of such Pledgor’s right, title and interest as a member in each limited
liability company listed on Part B of Schedule I (the “LLCs”), whether now owned
or hereafter acquired, including all of such Pledgor’s right, title and interest
in, to and under the limited liability company agreements described on Part B of
Schedule I (as such agreements have heretofore been and may hereafter be
amended, restated, supplemented or otherwise modified from time to time,
collectively, the “LLC Agreements”) to which it is a party (including, the right
to vote with respect to and to manage and administer the business of such LLCs)
together with all other rights, interests, claims and other property of such
Pledgor in any manner arising out of or relating to its membership interest in
the LLCs, whatever their respective kind or character, whether they are tangible
or intangible property, and wheresoever they may exist or be located, and
further including, without limitation, (1) all rights of such Pledgor to receive
distributions of any kind, in cash or otherwise, due or to become due under or
pursuant to each such LLC Agreement or otherwise in respect of such LLCs, (2)
all rights of such Pledgor to receive proceeds of any insurance, indemnity,
warranty or guaranty with respect to each such LLCs, (3) all claims of such
Pledgor for damages arising out of, or for the breach of, or for a default
under, each such LLC Agreement, (4) any certificated  security or uncertificated
security evidencing any of the foregoing issued by such LLCs to such Pledgor,
(5) any interest of such Pledgor in the entries on the books of any financial
intermediary pertaining to such Pledgor’s interest as a member in the LLCs and
(6) to the extent not included in the foregoing, all proceeds of any and all of
the foregoing; provided, however, that notwithstanding anything herein to the
contrary;

(i) Each Pledgor shall remain liable under the LLC Agreements to the extent set
forth therein to perform all of its duties and obligations thereunder to the
same extent as if this Pledge Agreement had not been executed;

(ii) The exercise by the Administrative Agent of any of its rights hereunder
shall not release any Pledgor from any of its duties or obligations under the
LLC Agreements (other than to the extent a Pledgor is precluded from performing
such duties solely as a result of the Administrative Agent’s having exercised
such rights or remedies);

(iii) Administrative Agent shall not have any obligation or liability under the
LLC Agreements by reason of this Pledge Agreement, nor shall the Administrative
Agent be obligated to perform any of the obligations or duties of the Pledgors
thereunder, to make any payment, to make any inquiry as to the nature or
sufficiency of any payment received by the Pledgors or the sufficiency of any
performance by any party under any such LLC Agreement, or to take any action to
collect or enforce any claim for payment assigned hereunder; and

(iv) Without limiting the generality of the foregoing, neither the grant of the
security interest in the Pledged Collateral in favor of the Administrative Agent
as provided herein nor the exercise by the Administrative Agent of any of its
rights hereunder nor any action by the Administrative Agent in connection with a
foreclosure on the Pledged Collateral shall be deemed to constitute the
Administrative Agent or any other Secured Party a member of any limited
liability company;

Notwithstanding the foregoing, the Pledged Collateral shall not include (i) any
Excluded Property or (ii) any Pledged Shares to the extent that a grant of a
security interest in such shares would require an offer for sale pursuant to, or
would result in a violation of, the applicable terms of any Foreign Corporate
Document.
 
 
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3. Security For Secured Obligations.  This Pledge Agreement and the Pledged
Collateral secure the prompt payment, in full when due, whether at stated
maturity, by acceleration or otherwise, and performance of the Secured
Obligations.

4. Delivery Of Pledged Collateral.  All certificates and instruments
representing or evidencing the Pledged Collateral shall be delivered to and held
by or on behalf of the Administrative Agent pursuant hereto. All Pledged Shares
shall be accompanied by duly executed, undated instruments of transfer or
assignment endorsed in blank, all in form and substance satisfactory to the
Administrative Agent and, if the Administrative Agent so requests after the
occurrence of an Event of Default, with signatures guaranteed by a member of a
registered national securities exchange or the National Association of
Securities Dealers, Inc. or by a commercial bank or trust company having an
office or correspondent in the United States. Upon the occurrence and during the
continuance of an Event of Default, the Administrative Agent shall have the
right, at any time in its discretion and upon notice to the applicable Pledgor,
to transfer to or to register in the name of the Administrative Agent or any of
its nominees any or all of the Pledged Shares or Pledged Membership Interests.
In addition, the Administrative Agent shall have the right at any time to
exchange certificates or instruments representing or evidencing Pledged Shares
for certificates or instruments of smaller or larger denominations.

5. Representations and Warranties.  Each Pledgor represents and warrants to the
Secured Parties as follows:

(a) Each Pledgor is, and at the time of delivery of the Pledged Shares and
Pledged Membership Interests to the Administrative Agent pursuant to Section 4
hereof will be, the sole holder of record and the sole beneficial owner of the
Pledged Collateral pledged by such Pledgor, free and clear of any Lien thereon
or affecting the title thereto except for (i) Liens permitted by Section 7.2 of
the Credit Agreement and (ii) those Liens created by or arising under the terms
of the Foreign Corporate Documents, if any.

(b) As of the date hereof, except as set forth on Schedule I, all of the Pledged
Shares and Pledged Membership Interests have been duly authorized, validly
issued and are fully paid and non-assessable and all documentary, stamp, or
other taxes or fees owing in connection with the issuance, transfer and/or
pledge thereof hereunder have been paid and will be hereafter paid by each
Pledgor as same becomes due and payable.

(c) As of the date hereof, no dispute, counterclaim or defense exists with
respect to all or any part of the Pledged Collateral.

(d) Each Pledgor has the requisite corporate authority to pledge, assign,
transfer, deliver, deposit and set over its Pledged Collateral to the
Administrative Agent as provided herein.

(e) As of the date hereof, there are no restrictions, other than applicable laws
and regulations affecting the offering and sales of securities generally, upon
the transfer, hypothecation or pledge of any of the Pledged Collateral, other
than those set forth expressly in the Foreign Corporate Documents.

 
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(f) None of the Pledged Shares or Pledged Membership Interests issued by any
Pledgor or any Subsidiary of any Pledgor have been issued or transferred in
violation of the securities registration, securities disclosure or similar laws
of any jurisdiction to which such issuance or transfer may be subject.

(g) Part A of Schedule I hereto lists the authorized shares of common stock, the
par value thereof and the number of issued and outstanding shares of common
stock of each issuer of Pledged Shares as of the date hereof.  As of the date
hereof, (i) no subscription, warrant, option or other rights to purchase or
acquire any shares of any class of capital stock of any issuer of Pledged Shares
is authorized and outstanding, and (ii) there is no commitment by any issuer of
Pledged Shares to issue any such shares, warrants, options or other such rights
or securities.

(h) Part B of Schedule I hereto lists all of the issued and outstanding
membership interests of each issuer of Pledged Membership Interests as of the
date hereof.  As of the date hereof, (i) no subscription, warrant, option or
other rights to purchase or acquire any membership interests of any issuer of
Pledged Membership Interests is authorized and outstanding, and (ii) there is no
commitment by any issuer of Pledged Membership Interests to issue any such
warrants, options or other such rights or securities.

(i) The pledge by each Pledgor of its Pledged Collateral is not in contravention
of any law or of any agreement to which such Pledgor is party or by which such
Pledgor is otherwise bound, and no consent, approval, authorization or other
order of, or other action by, any Person or notice to or filing with, any Person
is required (x) for the pledge by such Pledgor of the Pledged Collateral
pursuant to this Pledge Agreement or for the execution, delivery or performance
of this Pledge Agreement by such Pledgor or (y) for the exercise by the
Administrative Agent of the voting or other rights provided for in this Pledge
Agreement or the remedies in respect of the Pledged Collateral pursuant to this
Pledge Agreement (except as may be required in connection with any disposition
of any portion of the Pledged Collateral by laws affecting the offering and sale
of securities generally), except any consent, approval, authorization or other
order, or other action, as may be required under applicable laws in
jurisdictions other than the United States or any state thereof or as is
required by any Foreign Corporate Document.

(j) The pledge, assignment and delivery of the Pledged Collateral together with
duly executed, undated instruments of transfer or assignment endorsed in blank
pursuant to this Pledge Agreement will create a valid first priority Lien on and
a first priority perfected security interest in the Pledged Collateral and the
proceeds thereof, securing the payment of the Secured Obligations and no filing
or other action is necessary to perfect or protect such security interest,
except that (i) the filing of a financing statement, the taking of possession or
some other action may be required under Section 9-315 of the Uniform Commercial
Code as in effect in the State of New York (the “UCC") to perfect a security
interest in certain proceeds of the Pledged Collateral that do not constitute
Pledged Shares or other securities or instruments and (ii) the filing of a
financing statement under Sections 9-312 and 9-314 of the UCC may be required to
perfect a security interest in any Pledged Collateral that constitutes
“investment property” (other than the Pledged Shares) with respect to which the
Administrative Agent does not have “control” (as such terms are defined in the
UCC) and (iii) certain other actions may be necessary under the laws of the
jurisdictions of the Foreign Subsidiaries.

 
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(k) All of the representations and warranties contained in the Credit Agreement
and the other Loan Documents are true and correct in all material respects, are
incorporated herein by this reference and deemed to be made herein by each
Pledgor for purposes of this Pledge Agreement.

(l) This Pledge Agreement has been duly authorized, executed and delivered by
each Pledgor and constitutes a legal, valid and binding obligation of such
Pledgor enforceable against such Pledgor in accordance with its terms.

(m) Each Pledgor further acknowledges and agrees that the Pledged Membership
Interests, shall not be for purposes of this Pledge Agreement and the other Loan
Documents a “security” within the meaning of Article 8 of the UCC and shall not
be governed by Article 8 of the UCC.  No Pledgor shall at any time elect to
treat any such interest as a “security” within the meaning of Article 8 of the
UCC or issue any certificate representing such interest.

The representations and warranties set forth in this Section 5 shall survive the
execution and delivery of this Pledge Agreement.

6. Covenants.  Each Pledgor covenants and agrees that from and after the date of
this Pledge Agreement and until the payment and performance in full of all of
the Secured Obligations of such Pledgor:

(a) Such Pledgor shall not sell, assign, transfer, pledge or otherwise encumber
any of its rights in or to its Pledged Collateral or any unpaid dividends or
other distributions or payments with respect thereto except as permitted by the
Credit Agreement.

(b) Such Pledgor will not cause or permit any issuer of Pledged Shares or
Pledged Membership Interests to issue or grant any warrants, stock options of
any nature or other instruments convertible into membership interests or shares
of any class of capital stock or additional membership interests or shares of
capital stock or sell or transfer any membership interests or treasury stock
except as permitted by the Credit Agreement.

(c) Such Pledgor will, at its own cost and expense, promptly execute,
acknowledge and deliver all such instruments and take all such action as the
Administrative Agent from time to time may reasonably request in order to
perfect and protect the Lien granted or purported to be granted hereby or to
enable the Administrative Agent to exercise and enforce its rights and remedies
hereunder with respect to the Pledged Collateral.

(d)  Such Pledgor has and will, at its own cost and expense, defend the title to
its Pledged Collateral and the Liens of the Administrative Agent thereon against
the claim of any Person and will maintain and preserve such Liens.

 
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(e) Such Pledgor will comply with Section 5.8 of the Credit Agreement.

(f)    Such Pledgor shall not certificate any of the Pledged Membership
Interests.
 
(g)    Such Pledgor shall not treat any Pledged Membership Interest as a
“security” within the meaning of Article 8 of the UCC and no Pledged Membership
Interest shall  be governed by Article 8 of the UCC.

7. Adjustments and Distributions Concerning Pledged Collateral.  Should the
Pledged Collateral, or any part thereof, ever be converted in any manner by any
Pledgor into another type of property or any money or other proceeds ever be
paid or delivered to any Pledgor as a result of such Pledgor’s rights in the
Pledged Collateral, then in any such event (except as expressly provided in
Section 8 hereof), all such property, money and other proceeds shall promptly be
and become part of the Pledged Collateral, and each Pledgor covenants and agrees
to forthwith pay and deliver all money so received to the Administrative Agent,
for the benefit of the Secured Parties, as Pledged Collateral hereunder in
accordance with the provisions of the Credit Agreement; and, if the
Administrative Agent deems it necessary and so requests, to properly endorse,
assign or transfer any and all such other proceeds to the Administrative Agent
and to deliver to the Administrative Agent any and all such other proceeds which
require perfection by possession under the UCC.  With respect to any of such
property of a kind requiring an additional security agreement, financing
statement or other writing to perfect a security interest therein in favor of
the Administrative Agent, each Pledgor will forthwith execute and deliver to the
Administrative Agent, or cause to be executed and delivered to the
Administrative Agent, whatever the Administrative Agent shall reasonably deem
necessary or proper for such purposes.

8. Pledgors’ Rights; Termination Of Rights.

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

(i) Each Pledgor shall have the right, from time to time, to vote and give
consents with respect to its Pledged Collateral or any part thereof for all
purposes permitted by the Credit Agreement or any other Loan Documents;
provided, that, without limitation of the foregoing, no vote shall be cast, and
no consent shall be given or action taken by any Pledgor without the prior
written consent of the Administrative Agent that would authorize or effect
(except if and to the extent permitted by the Credit Agreement: (A) the
dissolution or liquidation, in whole or in part, of any issuer of the Pledged
Collateral, (B) the consolidation or merger of any issuer of the Pledged
Collateral with any other Person (other than any Pledgor), (C) the sale,
disposition or encumbrance of any portion of the assets of any issuer of the
Pledged Collateral or any business or division thereof, (D) any change in the
authorized number of shares or membership interests, the stated capital or the
authorized shares or member interest capital of any issuer of the Pledged
Collateral or the issuance of any additional shares of capital stock or
membership interests thereof, or (E) the alteration of the voting rights with
respect to the capital stock or membership interests of any issuer of the
Pledged Collateral);

 
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(ii) Each Pledgor shall be entitled, from time to time, to collect and receive
for its own use all dividends, distributions and other amounts paid in respect
of its Pledged Collateral to the extent not in violation of the Credit
Agreement.

(b) All dividends (other than such cash dividends as are permitted to be paid to
the Pledgors in accordance with Section 8(a)(ii) above), distributions and other
amounts in respect of any of the Pledged Shares or Pledged Membership Interests,
whenever paid or made, shall be delivered to the Administrative Agent to hold as
Pledged Collateral and shall, if received by any Pledgor, be received in trust
for the benefit of the Administrative Agent, be segregated from the other
property or funds of such Pledgor, and be forthwith delivered promptly to the
Administrative Agent as Pledged Collateral of such Pledgor in the same form as
so received (with any necessary endorsement or assignment).

(c) Upon the occurrence of an Event of Default and during the continuation
thereof, all of Pledgors’ rights to exercise voting and other consensual rights
pursuant to Section 8(a)(i) hereof and all of Pledgors’ rights to receive any
cash dividends and distributions pursuant to Section 8(a)(ii) hereof shall cease
and all such rights shall thereupon become vested in the Administrative Agent,
for the benefit of the Secured Parties, who shall have the sole and exclusive
right to exercise the voting and other consensual rights which the Pledgors
would otherwise be authorized to exercise pursuant to Section 8(a)(i) hereof and
to receive and retain the dividends and distributions which the Pledgors would
otherwise be authorized to receive and retain pursuant to Section 8(a)(ii)
hereof.  Upon the occurrence of an Event of Default and during the continuation
thereof, each Pledgor shall pay over to the Administrative Agent, for the
benefit of the Secured Parties, at the Administrative Agent’s election, any
dividends received by such Pledgor with respect to its Pledged Collateral and
any and all money and other property paid over to or received by the
Administrative Agent shall be retained by the Administrative Agent, for the
benefit of the Secured Parties, as Pledged Collateral hereunder and shall be
applied in accordance with the terms of the Credit Agreement.

9. Default.  The Pledgors shall be in default under this Pledge Agreement upon
the happening of any of the following events or conditions (hereinafter referred
to as an “Event of Default”):

(i)             The occurrence of an Event of Default as defined in the Credit
Agreement; and
(ii)            Any representation or warranty made by or on behalf of any
Pledgor under or pursuant to this Agreement shall have been false or misleading
in any material respect when made; or
(iii)           Failure of any Pledgor to observe any of its respective
covenants set forth in this Pledge Agreement other than those referenced in
paragraphs (i) and (ii) above, and if such failure is capable of being remedied,
such failure shall remain unremedied for thirty (30) days after notice from the
Administrative Agent.

 
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10. Remedies Upon An Event Of Default.

(a) Upon the occurrence of an Event of Default and during the continuation
thereof, the Administrative Agent may exercise all rights of a secured party
under the UCC (whether or not the UCC applies to the affected collateral).  In
addition, the Administrative Agent is hereby authorized and empowered
to  transfer and register in its name or in the name of its nominee the whole or
any part of the Pledged Collateral, exercise the voting rights with respect
thereto, collect and receive all cash dividends and other distributions made
thereon, sell in one or more sales after ten (10) days’ notice (or such longer
period as may be afforded by the UCC) of the time and place of any public sale
or of the time after which a private sale is to take place (which notice each
Pledgor agrees is commercially reasonable), but without any previous notice or
advertisement, the whole or any part of the Pledged Collateral and otherwise act
with respect to the Pledged Collateral as though the Administrative Agent was
the legal and record owner thereof.  Each Pledgor hereby irrevocably constitutes
and appoints the Administrative Agent, for the benefit of the Secured Parties,
as the proxy and attorney-in-fact of such Pledgor with respect to the Pledged
Collateral, with full power of substitution to exercise any of the rights
provided in the preceding sentence; provided, that the Administrative Agent
shall not have any duty to exercise any such right or to preserve the same and
shall not be liable for any failure to do so or for any delay in doing so.  Any
sale shall be made at a public or private sale at the Administrative Agent’s
offices or elsewhere to be named in the notice of sale, either for cash or upon
credit or for future delivery at such price as the Administrative Agent may deem
fair, and any Secured Party may be the purchaser of the whole or any part of the
Pledged Collateral so sold and hold the same thereafter in its own right free
from any claim of any Pledgor or any right of redemption, which each Pledgor
hereby waives to the extent permitted by applicable law.  Each sale shall be
made to the highest bidder, but the Administrative Agent reserves the right to
reject any and all bids at such sale which, in its discretion, it shall deem
inadequate.  Demands of performance, except as otherwise herein specifically
provided for, notices of sale, advertisements and the presence of property at
sale are hereby waived and any sale hereunder may be conducted by an auctioneer
or any officer or agent of the Administrative Agent.

(b) If, at the original time or times appointed for the sale of the whole or any
part of the Pledged Collateral, the highest bid, if there be but one sale, shall
be inadequate to discharge in full all the Secured Obligations, or if the
Pledged Collateral be offered for sale in lots, if at any of such sales, the
highest bid for the lot offered for sale would indicate to the Administrative
Agent, in its discretion, the unlikelihood of the proceeds of the sales of the
whole of the Pledged Collateral being sufficient to discharge all the Secured
Obligations, the Administrative Agent may, on one or more occasions and in its
discretion, postpone any of said sales by public announcement at the time of
sale or the time of previous postponement of sale, and no other notice of such
postponement or postponements of sale need be given, any other notice being
hereby waived; provided, that any sale or sales made after such postponement
shall be after ten (10) days’ notice(or such longer period as may be afforded by
the UCC) from the Administrative Agent to any such Pledgor.

 
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(c) If, at any time that the Administrative Agent shall determine to exercise
its rights to sell the whole or any part of the Pledged Collateral hereunder,
such Pledged Collateral or the part thereof to be sold shall not, for any reason
whatsoever, be effectively registered under the Securities Act of 1933, as
amended (the “Act”), the Administrative Agent may, in its discretion (subject
only to applicable requirements of law), sell such Pledged Collateral or part
thereof by private sale in such manner and under such circumstances as the
Administrative Agent may deem necessary or advisable, but subject to the other
requirements of this Section 9, and shall not be required to effect such
registration or to cause the same to be effected.  Without limiting the
generality of the foregoing, in any such event the Administrative Agent in its
discretion (i) may, in accordance with applicable securities laws, proceed to
make such private sale notwithstanding that a registration statement for the
purpose of registering such Pledged Collateral or part thereof could be or shall
have been filed under said Act (or similar statute), (ii) may approach and
negotiate with a single possible purchaser to effect such sale, (iii) may
restrict such sale to a purchaser who will represent and agree that such
purchaser is purchasing for its own account, for investment and not with a view
to the distribution or sale of such Pledged Collateral or part thereof, and (iv)
may place all or any part of the Pledged Collateral with an investment banking
firm for private placement, which firm shall be entitled to purchase all or any
part of the Pledged Collateral for its own account.  If any of the Pledged
Collateral shall not be freely distributable to the public without registration
under the Act (or similar statute), then the Administrative Agent shall not be
required to effect such registration or cause the same to be effected but, in
its discretion (subject to applicable requirements of law), may require that any
sale hereunder (including a sale at auction) be conducted subject to
restrictions (i) as to the financial sophistication and ability of any Person
permitted to bid or purchase at any such sale, (ii) as to the content of legends
to be placed upon any certificates representing the Pledged Collateral sold in
such sale, including restrictions on future transfer thereof, (iii) as to the
representations required to be made by each Person bidding or purchasing at such
sale relating to that Person’s access to financial information about any Pledgor
or any of its subsidiaries so sold and such Person’s intentions as to the
holding of the Pledged Collateral so sold for investment, for its own account,
and not with a view to the distribution thereof, and (iv) as to such other
matters as the Administrative Agent may, in its discretion, deem necessary or
appropriate in order that such sale (notwithstanding any failure so to register)
may be effected in compliance with the UCC and other laws affecting the
enforcement of creditors’ rights and the Act and all applicable state securities
laws.

(d) Each Pledgor recognizes that the Administrative Agent may be unable to
effect a public sale of any or all the Pledged Collateral and may be compelled
to resort to one or more private sales thereof.  Each Pledgor also acknowledges
that any such private sale may result in prices and other terms less favorable
to the seller than if such sale were a public sale and, notwithstanding such
circumstances, agrees that any such private sale shall be deemed to have been
made in a commercially reasonable manner.  The Administrative Agent shall be
under no obligation to delay a sale of any of the Pledged Collateral for the
period of time necessary to permit the registrant to register such securities
for public sale under the Act, or under applicable state securities laws, even
if each Pledgor would agree to do so.

(e) Any cash held by the Administrative Agent as Pledged Collateral and all cash
proceeds received by the Administrative Agent in respect of any sale of,
collection from, or other realization upon all or any part of the Pledged
Collateral shall be applied in the manner set forth in Section 8.2 of the Credit
Agreement.

 
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(f) Each Pledgor agrees that following the occurrence and during the
continuation of an Event of Default it will not at any time plead, claim or take
the benefit of any appraisal, valuation, stay, extension, moratorium or
redemption law now or hereafter in force in order to prevent or delay the
enforcement of this Pledge Agreement, or the absolute sale of the whole or any
part of the Pledged Collateral or the possession thereof by any purchaser at any
sale hereunder, and each Pledgor waives the benefit of all such laws to the
extent it lawfully may do so.  Each Pledgor agrees that it will not interfere
with any right, power and remedy of the Administrative Agent provided for in
this Pledge Agreement or now or hereafter existing at law or in equity or by
statute or otherwise, or the exercise or beginning of the exercise by the
Administrative Agent of any one or more of such rights, powers, or remedies.  No
failure or delay on the part of the Administrative Agent to exercise any such
right, power or remedy and no notice or demand which may be given to or made
upon any Pledgor by the Administrative Agent with respect to any such remedies
shall operate as a waiver thereof, or limit or impair the Administrative Agent’s
right to take any action or to exercise any power or remedy hereunder, without
notice or demand, or prejudice its rights as against any Pledgor in any
respect.  Except for gross negligence or willful misconduct, each Pledgor waives
all claims, damages and demands against the Administrative Agent arising out of
the repossession, retention or sale of the Pledged Collateral.

11. Power Of Attorney.  Each Pledgor appoints the Administrative Agent, or any
other Person whom the Administrative Agent may designate, as each Pledgor’s true
and lawful attorney-in-fact, with, upon the occurrence of an Event of Default,
power to endorse each  Pledgor’s name on any checks, notes, acceptances, money
orders, drafts or other form of payment or security representing a portion of
the Pledged Collateral that may come into the Administrative Agent’s possession
and to do all things  necessary to carry out the terms of this Pledge
Agreement.  Each Pledgor ratifies and approves all such acts of such
attorney-in-fact.   Except gross negligence or willful misconduct, neither the
Administrative Agent nor any other Person designated by the Administrative Agent
as attorney-in-fact hereunder will be liable for any acts or omissions, nor for
any errors of judgment or mistakes of fact or law.  This power, coupled with an
interest, is irrevocable until the Termination Time.

12. Administrative Agent’s Right To Take Action.  In the event that any Pledgor
fails or refuses promptly to perform any of its obligations set forth herein, or
otherwise fails or refuses to pay any amount necessary for the preservation and
protection of the Pledged Collateral, the Administrative Agent shall have the
right, without obligation, by notice to the Pledgors, to do all things it deems
necessary or advisable to discharge the same and any sums paid by the
Administrative Agent, or the cost thereof, including, without limitation,
reasonable attorneys’ fees, shall be reimbursed by the Pledgors, to the
Administrative Agent on demand and, until so reimbursed, shall bear interest at
the default rate of interest set forth in the Credit Agreement and shall be
additional Secured Obligations hereunder.

 
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13. Expenses.  The Pledgors shall, jointly and severally, pay (i) all reasonable
out-of-pocket costs, expenses, taxes and fees incurred by the Administrative
Agent, including the reasonable fees, charges and disbursements of counsel for
the Administrative Agent, in connection with the negotiation, preparation,
execution and delivery of this Pledge Agreement and all certificates, opinions
and other documents relating to these transactions, in all cases whether or not
the transaction contemplated hereby shall be consummated; (ii) all costs,
expenses, taxes and fees incurred by the Administrative Agent in connection with
the perfection, registration, maintenance, administration, custody and
preservation of the Pledged Collateral; and (iii) all costs, expenses, taxes and
fees incurred by any of the Secured Parties in connection with or after the
occurrence of any Event of Default, including, without limitation, in connection
with (a) the negotiation, preparation, execution and delivery of any waiver,
amendment or consent by the Secured Parties, (b) the negotiation of any
restructuring or workout transaction, and the preparation, execution and
delivery of any documents prepared in connection therewith, and (c) enforcement
or foreclosure with respect to this Pledge Agreement, in all such cases such
costs, expenses, taxes and fees shall include, without limitation, the
reasonable disbursements and reasonable professional fees actually incurred of
counsel to any Secured Party.  To the extent that any such fees and expenses are
subject to value added taxes, such taxes will be paid by the Pledgors.  To the
extent reimbursement is sought pursuant to this Section 13 or any other document
executed pursuant hereto, the Secured Parties shall submit to the Pledgors a
statement of expenses to be paid by the Pledgors.  Such expenses shall be due
and payable within thirty (30) days of the date of the original statement to the
extent that such Secured Party is entitled to such reimbursement.
 
14. Indemnity.  The Pledgors, jointly and severally, will indemnify and hold
harmless each of the Secured Parties and each of their respective employees,
representatives, officers and directors from and against any and all claims,
liabilities, investigations, losses, damages, actions, and demands by any party
against the Secured Parties or any of them resulting from any breach or alleged
breach by any Pledgor of any representation or warranty made hereunder, or
otherwise arising out of this Pledge Agreement, unless, with respect to any of
the above, any of the Secured Parties are finally judicially determined to have
acted or failed to act with gross negligence or willful misconduct.  This
Section 14 shall survive termination of this Pledge Agreement.

15. Limitation On the Administrative Agent’s Duty In Respect Of Pledged
Collateral. The Administrative Agent shall use reasonable care with respect to
the Pledged Collateral in its possession or under its control. The powers
conferred on the Administrative Agent hereunder are solely to protect its
interest in the Pledged Collateral and shall not impose any duty upon it to
exercise any such powers. Except for the safe custody of any Pledged Collateral
in its possession and the accounting for moneys actually received by it
hereunder, the Administrative Agent shall have no duty as to any Pledged
Collateral or any income thereon, as to ascertaining or taking action with
respect to calls, conversions, exchanges, maturities, tenders or other matters
relative 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
as to the taking of any necessary steps to preserve rights against any parties
or any other rights pertaining to any Pledged Collateral.  The Administrative
Agent shall be deemed to have exercised reasonable care in the custody and
preservation of any Pledged Collateral in its possession if such Pledged
Collateral is accorded treatment substantially equal to that which the
Administrative Agent accords its own property.

16. Security Interest Absolute.  All rights of the Administrative Agent and
security interests hereunder, and all obligations of each Pledgor hereunder,
shall be absolute and unconditional irrespective of:

(a)  any lack of validity or enforceability of the Loan Documents;

 
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(b) 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 amendment or waiver of
or any consent to any departure from the Loan Documents including, without
limitation, any increase in the Secured Obligations resulting from the extension
of additional credit to any Pledgor or any of its Subsidiaries or otherwise;

(c) any taking, exchange, release or non-perfection of any other collateral, or
any taking, release or amendment or waiver of or consent to departure from any
guaranty, for all or any of the Secured Obligations;

(d) any manner of application of collateral, or proceeds thereof, to all or any
of the Secured Obligations, or any manner of sale or other disposition of any
collateral for all or any part of the Secured Obligations or any other assets of
any Pledgor or any of its Subsidiaries;

(e) any change, restructuring or termination of the corporate structure or
existence of any Pledgor or any of its Subsidiaries; or

(f) any other circumstance which might otherwise constitute a defense available
to, or a discharge of, any Pledgor or a third party pledgor.

17. Reinstatement.  This Pledge Agreement shall remain in full force and effect
and continue to be effective should any petition be filed by or against any
Pledgor for liquidation or reorganization, should any Pledgor become insolvent
or make an assignment for the benefit of any creditor or creditors or should a
receiver or trustee be appointed for all or any significant part of any
Pledgor’s assets, and shall continue to be effective or be reinstated, as the
case may be, if at any time payment and performance of the Secured Obligations,
or any part thereof, is, pursuant to applicable law, rescinded or reduced in
amount, or must otherwise be restored or returned by any obligee of the Secured
Obligations, whether as a “voidable preference,” “fraudulent conveyance,”
“fraudulent transfer” or otherwise, all as though such payment or performance
had not been made.  In the event that any payment, or any part thereof, is
rescinded, reduced, restored or returned, the Secured Obligations shall be
reinstated and deemed reduced only by such amount paid and not so rescinded,
reduced, restored or returned.

18. Successors And Assigns.  This Pledge Agreement and all obligations of each
Pledgor hereunder shall be binding upon the successors and assigns of such
Pledgor (including any debtor-in-possession on behalf of such Pledgor) and
shall, together with the rights and remedies of the Administrative Agent, for
the benefit of the Secured Parties, hereunder, inure to the benefit of the
Administrative Agent, the other Secured Parties, all future holders of any
instrument evidencing any of the Secured Obligations and their respective
successors and assigns.  No sales of participations, other sales, assignments,
transfers or other dispositions of any agreement governing or instrument
evidencing the Secured Obligations or any portion thereof or interest therein
shall in any manner affect the Lien granted to the Administrative Agent, for the
benefit of the Secured Parties, hereunder.  No Pledgor may assign, sell,
hypothecate or otherwise transfer any interest in or obligation under this
Pledge Agreement.

 
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19. Waivers; Amendment.
 
(a)            No failure or delay by any Secured Party of any kind in
exercising any power, right or remedy hereunder and no course of dealing between
any Pledgor on the one hand and the administrative Agent or the holder of any
Note on the other hand shall operate as a waiver thereof, nor shall any single
or partial exercise of any such power, right or remedy hereunder or under any
other Loan Document, or any abandonment or discontinuance of steps to enforce
such a power, right or remedy, preclude any other or further exercise thereof or
the exercise of any other power, right or remedy. The rights of the Secured
Parties hereunder and of the Lenders 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 Pledge Agreement or consent
to any departure by any Pledgor therefrom shall in any event be effective unless
the same shall be permitted by subsection (b) below, and then such waiver and
consent shall be effective only in the specific instance and for the purpose for
which given.  No notice or demand on any Pledgor in any case shall entitle such
Pledgor to any other or further notice in similar or other circumstances.
 
(b)            Neither this Pledge Agreement nor any provision hereof may be
waived, amended or modified except pursuant to a written agreement entered into
between the Pledgors with respect to which such waiver, amendment or
modification relates and the Administrative Agent, with the prior written
consent of the Required Lenders (except as otherwise provided in the Credit
Agreement).

20. Severability.   Any provision of this Pledge Agreement held to be illegal,
invalid or unenforceable in any jurisdiction, shall, as to such jurisdiction, be
ineffective to the extent of such illegality, invalidity or unenforceability
without affecting the legality, validity or enforceability of the remaining
provisions hereof or thereof; and the illegality, invalidity or unenforceability
of a particular provision in a particular jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

21. Notices.  All notices, requests and other communications to the Pledgors or
Administrative Agent hereunder shall be delivered in the manner required by the
Credit Agreement and shall be sufficiently given to Administrative Agent or any
Pledgor if addressed or delivered to them at, in the case of the Administrative
Agent and Borrower, its addresses and telecopier numbers specified in the Credit
Agreement and in the case of any other Pledgor, at their respective addresses
and telecopier numbers provided in the Subsidiary Guaranty Agreement.  All such
notices and communications shall be deemed to have been duly given at the times
set forth in the Credit Agreement.

22. Counterparts; Integration.  This Pledge Agreement may be executed by one or
more of the parties to this Pledge Agreement on any number of separate
counterparts (including by telecopy), and all of said counterparts taken
together shall be deemed to constitute one and the same instrument. This Pledge
Agreement constitutes the entire agreement among the parties hereto regarding
the subject matters hereof and supersedes all prior agreements and
understandings, oral or written, regarding such subject matter.

 
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23. Governing Law; Jurisdiction; Consent to Service of Process.

(a)            This Pledge Agreement shall be construed in accordance with and
be governed by the law of the State of New York.
 
(b)            Each party to this Pledge Agreement hereby irrevocably and
unconditionally submits, for itself and its property, to the non-exclusive
jurisdiction of the United States courts located within the Southern district in
the State of New York, and of any state court of the State of New York located
in New York county and any appellate court from any thereof, in any action or
proceeding arising out of or relating to this Pledge Agreement or any other Loan
Document or the transactions contemplated hereby or thereby, or for recognition
or enforcement of any judgment, and each of the parties hereto hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may be heard and determined in such New York state court
or, to the extent permitted by applicable law, 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 Pledge
Agreement shall affect any right that the Administrative Agent, the Issuing Bank
or any Lender may otherwise have to bring any action or proceeding relating to
this Pledge Agreement against any Pledgor or its properties in the courts of any
jurisdiction.
 
(c)            Each party to this Pledge Agreement ir­­revocably and
unconditionally waives any objection which it may now or hereafter have to the
laying of venue of any such suit, action or proceeding described in paragraph
(b) of this Section and brought in any court referred to in paragraph (b) of
this Section.  Each party hereto 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.
 
(d)            Each party to this Pledge Agreement irrevocably consents to the
service of process in the manner provided for notices in Section 10.1 of the
Credit Agreement. Nothing in this Pledge Agreement will affect the right of the
Administrative Agent or any Lender to serve process in any other manner
permitted by law.

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

 
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25. Benefit of Secured Parties.  All Liens granted or contemplated hereby shall
be for the benefit of the Secured Parties, and all proceeds or payments realized
from Pledged Collateral in accordance herewith shall be applied to the Secured
Obligations in accordance with Section 8.2 of the Credit Agreement.

26. Termination of this Pledge Agreement.  No termination or cancellation
(regardless of cause or procedure) of the Credit Agreement shall in any way
affect or impair the powers, obligations, duties, rights and liabilities of the
parties hereto in any way with respect to (i) any transaction or event occurring
prior to such termination or cancellation, (ii) the Pledged Collateral, or (iii)
any Pledgor’s undertakings, agreements, covenants, warranties and
representations contained in this Pledge Agreement and all such undertakings,
agreements, covenants, warranties and representations shall survive such
termination or cancellation until the Termination Time.  Subject to Section
17  hereof, this Pledge Agreement and the security interests granted hereunder
shall terminate at the Termination Time.  Upon such termination, Administrative
Agent shall return all Pledged Collateral in its possession to the respective
Pledgors and will, at the sole cost and expense of the Pledgors, execute such
documents, without recourse or warranty, as Pledgors deem reasonably necessary
to release any interests held by Administrative Agent or the Secured Parties in
the Pledged Collateral.

27. Additional Pledged Collateral.  In the event that the any Pledgor is
required, under the terms of any Loan Document or otherwise, to pledge and
hypothecate any Collateral after the Closing Date, such Pledgor shall pledge and
hypothecate such Collateral, and be bound with respect to such Col­lateral by
all of the terms and conditions hereof, by delivery to the Administrative Agent
of an executed counter­part of a Supplement to Subsidiary Pledge Agreement in
the form of Exhibit A attached hereto.

28. Additional Pledgors.  Pursuant to Section 5.11 of the Credit Agreement, each
Subsidiary that that is required to become a Subsidiary Loan Party after the
date of the Credit Agreement is required to enter into this Agreement as a
Pledgor upon becoming such a Subsidiary Loan Party.  Upon execution and delivery
after the date hereof by the Administrative Agent and such Subsidiary of an
instrument in the form of Exhibit B, such Subsidiary shall become a Pledgor
hereunder with the same force and effect as if originally named as a Pledgor
herein.  The execution and delivery of any instrument adding an additional
Pledgor as a party to this Pledge Agreement shall not require the consent of any
other Pledgor hereunder.  The rights and obligations of each Pledgor hereunder
shall remain in full force and effect notwithstanding the addition of any new
Pledgor as a party to this Pledge Agreement.
 

[Signature Pages Follow]
 
 
 
 
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IN WITNESS WHEREOF, each Pledgor has caused this Pledge Agreement to be executed
and delivered by its duly authorized officer as of the date first set forth
above.

MAXIMUS, INC., a Virginia corporation     By:
 /s/ Richard A. Montoni
Name:
 Richard A. Montoni
Title:
 President and CEO

 
Acknowledged and Agreed to:
 
    SUNTRUST BANK,
    as Administrative Agent
 
    By: /s/ Linda L. Bergmann                            
    Name:  Linda L. Bergmann
    Title:    Vice President

 
 
[SIGNATURE PAGE TO AMENDED AND RESTATED BORROWER PLEDGE AGREEMENT]