Exhibit 10.3

Execution Copy

CANADIAN GUARANTY AND SECURITY AGREEMENT

This CANADIAN GUARANTY AND SECURITY AGREEMENT (this “Agreement”), dated as of
January 27, 2012 among the Persons listed on the signature pages hereof as
“Grantors” and those additional entities that hereafter become parties hereto by
executing the form of Joinder attached hereto as Annex 1 (each, a “Grantor” and
collectively, the “Grantors”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, in
its capacity as administrative agent and collateral agent for the Lender Group
and the Bank Product Providers (in such capacity, together with its successors
and assigns in such capacity, “Agent”).

W I T N E S S E T H:

WHEREAS, pursuant to that certain Credit Agreement of even date herewith (as
amended, restated, supplemented, or otherwise modified from time to time, the
“Credit Agreement”) by and among American Reprographics Company, a Delaware
corporation (“US Borrower”), ARC Reprographics Canada Corp., a British Columbia
corporation (“ARC Canada”) and ARC Digital Canada Corp., a British Columbia
corporation (“ARC Digital Canada”; and ARC Digital Canada together with ARC
Canada, “Canadian Borrowers”), US Borrower and Canadian Borrowers are
collectively referred to as “Borrowers”), the lenders party thereto as “Lenders”
(each of such Lenders, together with its successors and permitted assigns, is
referred to hereinafter as a “Lender”), Agent, and Wells Fargo Capital Finance
Corporation Canada, an Ontario corporation, as administrative agent for the
Canadian Lenders (in such capacity, together with its successors and assigns in
such capacity, “Canadian Agent”), the Lender Group has agreed to make certain
financial accommodations available to Borrowers from time to time pursuant to
the terms and conditions thereof; and

WHEREAS, Agent has agreed to act as agent for the benefit of the Lender Group
and the Bank Product Providers and as collateral agent for the Canadian Agent
with respect to its interests in the Collateral to secure Canadian Obligations
in connection with the transactions contemplated by the Credit Agreement and
this Agreement; and

WHEREAS, in order to induce the Lender Group to enter into the Credit Agreement
and the other Loan Documents, to induce the Bank Product Providers to enter into
the Bank Product Agreements, and to induce the Lender Group and the Bank Product
Providers to make financial accommodations to Borrowers as provided for in the
Credit Agreement, the other Loan Documents to which the Canadian Borrowers are
parties and the Canadian Bank Product Agreements, each Grantor has agreed to
grant to Agent, for the benefit of the Canadian Lenders and the Canadian Bank
Product Providers, a continuing security interest in and to the Collateral in
order to secure the prompt and complete payment, observance and performance of,
among other things, the Secured Obligations.

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NOW, THEREFORE, for and in consideration of the recitals made above and other
good and valuable consideration, the receipt, sufficiency and adequacy of which
are hereby acknowledged, the parties hereto agree as follows:

1. Definitions; Construction.

(a) All initially capitalized terms used herein (including in the preamble and
recitals hereof) without definition shall have the meanings ascribed thereto in
the Credit Agreement (including Schedule 1.1 thereto). Any terms (whether
capitalized or lower case) used in this Agreement that are defined in the PPSA
shall be construed and defined as set forth in the PPSA unless otherwise defined
herein or in the Credit Agreement. In addition to those terms defined elsewhere
in this Agreement, as used in this Agreement, the following terms shall have the
following meanings:

 

  (i) “Account” means an account (as that term is defined in the PPSA).

 

  (ii) “Account Debtor” means each person who is obligated on a Receivable.

 

  (iii) “Activation Instruction” has the meaning specified therefor in
Section 7(k)(i).

 

  (iv) “Agent” has the meaning specified therefor in the preamble to this
Agreement.

 

  (v) “Agent’s Lien” has the meaning specified therefor in the Credit Agreement.

 

  (vi) “Agreement” has the meaning specified therefor in the preamble to this
Agreement.

 

  (vii) “Books” means books and records (including each Grantor’s Records
indicating, summarizing, or evidencing such Grantor’s assets (including the
Collateral) or liabilities, each Grantor’s Records relating to such Grantor’s
business operations or financial condition, and each Grantor’s goods or General
Intangibles related to such information).

 

  (viii) “Borrowers” has the meaning specified therefor in the recitals to this
Agreement.

 

  (ix) “Canadian Bank Product Obligations” has the meaning specified therefor in
the Credit Agreement.

 

  (x) “Canadian Bank Product Provider” has the meaning specified therefor in the
Credit Agreement.

 

  (xi) “Canadian Obligations” has the meaning specified therefor in the Credit
Agreement.

 

  (xii) “Cash Equivalents” has the meaning specified therefor in the Credit
Agreement.

 

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  (xiii) “Chattel Paper” means chattel paper (as that term is defined in the
PPSA), and includes tangible chattel paper and electronic chattel paper.

 

  (xiv) “CIPO” means the Canadian Intellectual Property Office.

 

  (xv) “Collateral” has the meaning specified therefor in Section 3.

 

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

 

  (xvii) “Collections” has the meaning specified therefor in the Credit
Agreement.

 

  (xviii) “Control Agreement” has the meaning specified therefor in the Credit
Agreement.

 

  (xix) “Controlled Account” has the meaning specified therefor in Section 7(k).

 

  (xx) “Controlled Account Agreements” means those certain cash management
agreements, in form and substance reasonably satisfactory to Agent, each of
which is executed and delivered by a Grantor, Agent, and one of the Controlled
Account Banks.

 

  (xxi) “Controlled Account Bank” has the meaning specified therefor in
Section 7(k).

 

  (xxii) “Copyrights” means, collectively, with respect to each Grantor, all
copyrights (whether statutory or common law, whether established or registered
in Canada or any other country or any political subdivision thereof, whether
registered or unregistered and whether published or unpublished), including
copyrights in computer software and all copyright registrations and applications
made by such Grantor, including those listed on Schedule 1 to this Agreement, in
each case, whether now owned or hereafter created or acquired by or assigned to
such Grantor, together with any and all (i) rights and privileges arising under
applicable law with respect to such Grantor’s use of such copyrights,
(ii) reissues, renewals, continuations and extensions thereof and amendments
thereto, (iii) 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, (iv) rights
corresponding thereto throughout the world and (v) rights to sue for past,
present or, future infringements thereof.

 

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  (xxiii) “Copyright Security Agreement” means each Copyright Security Agreement
executed and delivered by Grantors, or any of them, and Agent, in substantially
the form of Exhibit A.

 

  (xxiv) “Credit Agreement” has the meaning specified therefor in the recitals
to this Agreement.

 

  (xxv) “Deposit Account” means all deposit accounts of a Grantor.

 

  (xxvi) “Documents of Title” means documents of title (as that term is defined
in the PPSA).

 

  (xxvii) “Dominion Triggering Event” means, as of any date of determination,
that (A) Agent has notified Borrowers that an Event of Default has occurred as
of such date, or (B) Excess Availability is less than $15,000,000 for the third
consecutive Business Day.

 

  (xxviii) “Equipment” means equipment (as that term is defined in the PPSA).

 

  (xxix) “Equity Interests” has the meaning specified therefor in the Credit
Agreement.

 

  (xxx) “Event of Default” has the meaning specified therefor in the Credit
Agreement.

 

  (xxxi) “Foreclosed Grantor” has the meaning specified therefor in
Section 2(i)(iii).

 

  (xxxii) “General Intangibles” means all intangibles (as that term is defined
in the PPSA), and includes payment intangibles, software, contract rights,
rights to payment, rights under Hedge Agreements (including the right to receive
payment on account of the termination (voluntarily or involuntarily) of such
Hedge Agreements), rights arising under common law, statutes, or regulations,
choses or things in action, goodwill, Intellectual Property, Intellectual
Property Licenses, purchase orders, customer lists, monies due or recoverable
from pension funds, route lists, rights to payment and other rights under any
royalty or licensing agreements, including Intellectual Property Licenses,
infringement claims, pension plan refunds, pension plan refund claims, insurance
premium rebates, tax refunds, and tax refund claims, interests in a partnership
or limited liability company, Accounts and Deposit Accounts, but does not
include Goods, Chattel Paper, Instruments, a Document of Title, Money or
Investment Property.

 

  (xxxiii) “Goods” means goods (as that term is defined in the PPSA).

 

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  (xxxiv) “Grantor” and “Grantors” have the respective meanings specified
therefor in the preamble to this Agreement.

 

  (xxxv) “Guarantied Obligations” means all of the Canadian Obligations
(including any Canadian Bank Product Obligations) now or hereafter existing,
whether for principal, interest (including any interest that accrues after the
commencement of an Insolvency Proceeding, regardless of whether allowed or
allowable in whole or in part as a claim in any such Insolvency Proceeding),
fees (including the fees provided for in the Fee Letter), Lender Group Expenses
relating to Canadian Obligations (including any fees or expenses that accrue
after the commencement of an Insolvency Proceeding, regardless of whether
allowed or allowable in whole or in part as a claim in any such Insolvency
Proceeding), or otherwise, and any and all expenses (including reasonable
counsel fees and expenses) incurred by Agent, any other member of the Lender
Group, or any Canadian Bank Product Provider (or any of them) in enforcing any
rights under the any of the Loan Documents but only insofar as they relate to
the Canadian Borrowers. Without limiting the generality of the foregoing,
Guarantied Obligations shall include all amounts that constitute part of the
Guarantied Obligations and would be owed by any Canadian Borrower to Agent, any
other member of the Lender Group, or any Canadian Bank Product Provider but for
the fact that they are unenforceable or not allowable, including due to the
existence of a bankruptcy, reorganization, other Insolvency Proceeding or
similar proceeding involving any Borrower or any guarantor.

 

  (xxxvi) “Guarantor” means each Grantor other than Canadian Borrowers.

 

  (xxxvii) “Guaranty” means the guaranty set forth in Section 2 hereof.

 

  (xxxviii) “Insolvency Proceeding” has the meaning specified therefor in the
Credit Agreement.

 

  (xxxix) “Instruments” means, collectively, with respect to each Grantor, all
“instruments,” as such term is defined in the PPSA, and shall include all
promissory notes, drafts, bills of exchange or acceptances.

 

  (xl)

“Intellectual Property” means any and all Patents, Copyrights, Trademarks, trade
secrets, know-how, inventions (whether or not patentable), algorithms, software
programs (including source code and object code), processes, product designs,
industrial designs, blueprints, drawings, data, customer lists, URLs and domain

 

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  names, specifications, documentations, reports, catalogs, literature, and any
other forms of technology or proprietary information of any kind, including all
rights therein and all applications for registration or registrations thereof.

 

  (xli) “Intellectual Property Licenses” means, with respect to any Person (the
“Specified Party”), (A) any licenses or other similar rights provided to the
Specified Party in or with respect to Intellectual Property owned or controlled
by any other Person, and (B) any licenses or other similar rights provided to
any other Person in or with respect to Intellectual Property owned or controlled
by the Specified Party, in each case, including (x) any software license
agreements (other than license agreements for commercially available
off-the-shelf software that is generally available to the public which have been
licensed to a Grantor pursuant to end-user licenses), (y) the license agreements
listed on Schedule 2, and (z) the right to use any of the licenses or other
similar rights described in this definition in connection with the enforcement
of the Lender Group’s rights under the Loan Documents; provided however, that
“Intellectual Property Licenses” shall not include any license that is excluded
from the definition of Collateral as set forth in the last paragraph of
Section 3 of this Agreement.

 

  (xlii) “Inventory” means inventory (as that term is defined in the PPSA).

 

  (xliii) “Investment Property” means (A) any and all investment property (as
that term is defined in the PPSA), and (B) any and all of the following
(regardless of whether classified as investment property under the PPSA): all
Pledged Interests, Pledged Operating Agreements, and Pledged Partnership
Agreements.

 

  (xliv) “Joinder” means each Joinder to this Agreement executed and delivered
by Agent and each of the other parties listed on the signature pages thereto, in
substantially the form of Annex 1.

 

  (xlv) “Lender Group” has the meaning specified therefor in the Credit
Agreement.

 

  (xlvi) “Lender” and “Lenders” have the respective meanings specified therefor
in the recitals to this Agreement.

 

  (xlvii) “Loan Document” has the meaning specified therefor in the Credit
Agreement.

 

  (xlviii) “Money” means money (as that term is defined in the PPSA).

 

  (xlix) “Negotiable Collateral” means letters of credit, Instruments,
promissory notes, drafts and Documents of Title.

 

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  (l) “Patents” means patents and patent applications, including (A) the patents
and patent applications listed on Schedule 3, (B) all continuations,
divisionals, continuations-in-part, re-examinations, reissues, and renewals
thereof and improvements thereon, (C) all income, royalties, damages and
payments now and hereafter due or payable under and with respect thereto,
including payments under all licenses entered into in connection therewith and
damages and payments for past, present, or future infringements thereof, (D) the
right to sue for past, present, and future infringements thereof, and (E) all of
each Grantor’s rights corresponding thereto throughout the world.

 

  (li) “Patent Security Agreement” means each Patent Security Agreement executed
and delivered by Grantors, or any of them, and Agent, in substantially the form
of Exhibit B.

 

  (lii) “Permitted Investments” has the meaning specified therefor in the Credit
Agreement.

 

  (liii) “Permitted Liens” has the meaning specified therefor in the Credit
Agreement.

 

  (liv) “Person” has the meaning specified therefor in the Credit Agreement.

 

  (lv) “Pledged Companies” means each Person listed on Schedule 4 as a “Pledged
Company”, together with each other Person, all or a portion of whose Equity
Interests are acquired or otherwise owned by a Grantor after the Closing Date;
provided, however, that Pledged Companies shall not include any company whose
stock is excluded from the definition of Collateral as set forth in the last
paragraph of Section 3 of this Agreement.

 

  (lvi)

“Pledged Interests” means all of each Grantor’s right, title and interest in and
to all of the Equity Interests now owned or hereafter acquired by such Grantor,
regardless of class or designation, including in each of the Pledged Companies,
and all substitutions therefor and replacements thereof, all proceeds thereof
and all rights relating thereto, also including any certificates representing
the Equity Interests, the right to receive any certificates representing any of
the Equity Interests, all warrants, options, share appreciation rights and other
rights, contractual or otherwise, in respect thereof and the right to receive
all dividends, distributions of income, profits, surplus, or other compensation
by way of income or liquidating distributions, in cash or in kind, and all cash,
instruments, and other property from time to time received, receivable, or
otherwise distributed in respect of or in addition to,

 

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  in substitution of, on account of, or in exchange for any or all of the
foregoing, provided, however, that Pledged Interests shall not include any
Equity Interests excluded from the definition of Collateral as set forth in the
last paragraph of Section 3 of this Agreement.

 

  (lvii) “Pledged Interests Addendum” means a Pledged Interests Addendum
substantially in the form of Exhibit C.

 

  (lviii) “Pledged Notes” has the meaning specified therefor in Section 6(k).

 

  (lix) “Pledged Operating Agreements” means all of each Grantor’s rights,
powers, and remedies under the limited liability company operating agreements of
each of the Pledged Companies that are limited liability companies.

 

  (lx) “Pledged Partnership Agreements” means all of each Grantor’s rights,
powers, and remedies under the partnership agreements of each of the Pledged
Companies that are partnerships.

 

  (lxi) “PPSA” means the Personal Property Security Act (Ontario) and the
regulations issued thereunder, as amended, supplemented or replaced from time to
time.

 

  (lxii) “Proceeds” has the meaning specified therefor in Section 3.

 

  (lxiii) “Real Property” means any estates or interests in real property now
owned or hereafter acquired by any Grantor or any Subsidiary of any Grantor and
the improvements thereto.

 

  (lxiv) “Receivables” means all (i) Accounts, (ii) Chattel Paper, (iii) General
Intangibles, (iv) Instruments and (v) other 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,
regardless of how classified under the PPSA together with all of Grantors’
rights, if any, in any goods or other property giving rise to such right to
payment and all Collateral Support and Documents of Title related thereto and
all Records relating thereto.

 

  (lxv) “Record” means information that is inscribed on a tangible medium or
which is stored in an electronic or other medium and is retrievable in
perceivable form.

 

  (lxvi) “Rescission” has the meaning specified therefor in Section 7(k).

 

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  (lxvii) “Secured Obligations” means each and all of the following: (A) all of
the present and future obligations of each of the Grantors arising from, or
owing under or pursuant to, this Agreement (including the Guaranty), the Credit
Agreement, or any of the other Loan Documents, (B) all Canadian Bank Product
Obligations, and (C) all other Canadian Obligations and all other Guarantied
Obligations of each Guarantor (including, in the case of each of clauses (A),
(B) and (C), reasonable legal fees and expenses and any interest, fees, or
expenses that accrue after the filing of an Insolvency Proceeding, regardless of
whether allowed or allowable in whole or in part as a claim in any Insolvency
Proceeding), provided however that Secured Obligations shall not in any event
include any of the Obligations of the US Borrower.

 

  (lxviii) “Securities Account” means a securities account (as that term is
defined in the PPSA).

 

  (lxix) “Security Interest” has the meaning specified therefor in Section 3.

 

  (lxx) “STA” means the Securities Transfer Act (Ontario), together with all
regulations thereunder or related thereto, as amended, supplemented or replaced
from time to time or, to the extent applicable, the corresponding legislation in
any other province.

 

  (lxxi) “Trademarks” means any and all trade-marks, trade names, registered
trade-marks, trade-mark applications, service marks, registered service marks
and service mark applications, including (A) the trade names, registered
trade-marks, trade-mark applications, registered service marks and service mark
applications listed on Schedule 5, (B) all renewals thereof, (C) all income,
royalties, damages and payments now and hereafter due or payable under and with
respect thereto, including payments under all licenses entered into in
connection therewith and damages and payments for past or future infringements
or dilutions thereof, (D) the right to sue for past, present and future
infringements and dilutions thereof, (E) the goodwill of each Grantor’s business
symbolized by the foregoing or connected therewith, and (F) all of each
Grantor’s rights corresponding thereto throughout the world.

 

  (lxxii) “Trademark Security Agreement” means each Trademark Security Agreement
executed and delivered by Grantors, or any of them, and Agent, in substantially
the form of Exhibit D.

 

  (lxxiii) “URL” means “uniform resource locator,” an internet web address.

(b) Unless the context of this Agreement clearly requires otherwise, references
to the plural include the singular, references to the singular include the
plural, the

 

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terms “includes” and “including” are not limiting, and the term “or” has, except
where otherwise indicated, the inclusive meaning represented by the phrase
“and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and similar terms
in this Agreement refer to this Agreement as a whole and not to any particular
provision of this Agreement. Section, subsection, clause, schedule, and exhibit
references herein are to this Agreement unless otherwise specified. Any
reference in this Agreement to any agreement, instrument, or document shall
include all alterations, amendments, changes, extensions, modifications,
renewals, replacements, substitutions, joinders, and supplements, thereto and
thereof, as applicable (subject to any restrictions on such alterations,
amendments, changes, extensions, modifications, renewals, replacements,
substitutions, joinders, and supplements set forth herein or in the Credit
Agreement). The words “asset” and “property” shall be construed to have the same
meaning and effect and to refer to any and all tangible and intangible assets
and properties. Any reference herein to the satisfaction, repayment, or payment
in full of the Secured Obligations or the Guarantied Obligations shall mean
(i) the payment or repayment in full in cash or immediately available funds of
(A) the principal amount of, and interest accrued with respect to, all
outstanding Canadian Advances to Canadian Borrowers, together with the payment
of any premium applicable to the repayment of the Canadian Advances to Canadian
Borrowers, (B) all Lender Group Expenses that have accrued regardless of whether
demand has been made therefor in respect of the Canadian Advances to Canadian
Borrowers, (C) all fees or charges that have accrued hereunder or under any
other Loan Document (including the letter of credit fee and the unused line fee)
in respect of Canadian Advances, (ii) in the case of contingent reimbursement
obligations with respect to Canadian Letters of Credit, providing Canadian
Letter of Credit Collateralization, (iii) in the case of obligations with
respect to Canadian Bank Products (other than Hedge Obligations), providing
Canadian Bank Product Collateralization, (iv) the receipt by Agent or Canadian
Agent of cash collateral in order to secure any other contingent Secured
Obligations or Guarantied Obligations for which a claim or demand for payment
has been made at such time or in respect of matters or circumstances known to
Agent or a Lender at the time that are reasonably expected to result in any
loss, cost, damage or expense (including legal fees and expenses), such cash
collateral to be in such amount as Agent or Canadian Agent reasonably determines
is appropriate to secure such contingent Secured Obligations or Guarantied
Obligations, (v) the payment or repayment in full in immediately available funds
of all other Secured Obligations or Guarantied Obligations (as the case may be)
(including the payment of any termination amount then applicable (or which would
or could become applicable as a result of the repayment of the other Canadian
Obligations) under Hedge Agreements provided by Hedge Providers) other than
(A) unasserted contingent indemnification obligations, (B) any Canadian Bank
Product Obligations (other than Hedge Obligations) that, at such time, are
allowed by the applicable Canadian Bank Product Provider to remain outstanding
without being required to be repaid or cash collateralized, and (C) any Hedge
Obligations that, at such time, are allowed by the applicable Hedge Provider to
remain outstanding without being required to be repaid, and (vi) the termination
of all of the Canadian Revolver Commitments of the Canadian Lenders. Any
reference herein to any Person shall be construed to include such Person’s
successors and assigns. Any requirement of a writing contained herein or in any
other Loan Document shall be satisfied by the transmission of a Record.

(c) All of the schedules and exhibits attached to this Agreement shall be deemed
incorporated herein by reference.

 

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2. Guaranty.

(a) In recognition of the direct and indirect benefits to be received by
Guarantors from the proceeds of the Advances, the issuance of the Letters of
Credit, and the entering into of the Canadian Bank Product Agreements and by
virtue of the financial accommodations to be made to Borrowers, each of the
Guarantors, jointly and severally, hereby unconditionally and irrevocably
guarantees as a primary obligor and not merely as a surety the full and prompt
payment when due, whether upon maturity, acceleration, or otherwise, of all of
the Guarantied Obligations. If any or all of the Guarantied Obligations becomes
due and payable, each of the Guarantors, unconditionally and irrevocably, and
without the need for demand, protest, or any other notice or formality, promises
to pay such Guarantied Obligations to Agent or Canadian Agent, as applicable,
for the benefit of the Lender Group and the Canadian Bank Product Providers,
together with any and all expenses (including Lender Group Expenses) that may be
incurred by Agent or Canadian Agent or any other member of the Lender Group or
any Canadian Bank Product Provider in demanding, enforcing, or collecting any of
the Guarantied Obligations (including the enforcement of any collateral for such
Obligations or any collateral for the obligations of the Guarantors under this
Guaranty). If a claim is ever made upon Agent or Canadian Agent or any other
member of the Lender Group or any Canadian Bank Product Provider for repayment
or recovery of any amount or amounts received in payment of or on account of any
or all of the Guarantied Obligations and any of Agent or Canadian Agent or any
other member of the Lender Group or any Canadian Bank Product Provider repays
all or part of said amount by reason of (i) any judgment, decree, or order of
any court or administrative body having jurisdiction over such payee or any of
its property, or (ii) any settlement or compromise of any such claim effected by
such payee with any such claimant (including any Borrower or any Guarantor),
then and in each such event, each of the Guarantors agrees that any such
judgment, decree, order, settlement, or compromise shall be binding upon the
Guarantors, notwithstanding any revocation (or purported revocation) of this
Guaranty or other instrument evidencing any liability of any Grantor, and the
Guarantors shall be and remain liable to the aforesaid payees hereunder for the
amount so repaid or recovered to the same extent as if such amount had never
originally been received by any such payee.

(b) Additionally, each of the Guarantors unconditionally and irrevocably
guarantees the payment of any and all of the Canadian Obligations to Agent
and/or Canadian Agent, as applicable, for the benefit of the Lender Group and
the Canadian Bank Product Providers, whether or not due or payable by any Loan
Party upon the occurrence of any of the events specified in Section 8.4 or 8.5
of the Credit Agreement, and irrevocably and unconditionally promises to pay
such indebtedness to Agent and/or Canadian Agent, as applicable, for the benefit
of the Lender Group and the Canadian Bank Product Providers, without the
requirement of demand, protest, or any other notice or other formality, in the
currency in which the Canadian Obligations are denominated.

(c) The liability of each of the Guarantors hereunder is primary, absolute, and
unconditional, and is independent of any security for or other guaranty of the
Guarantied Obligations, whether executed by any other Guarantor or by any other
Person, and the liability of each of the Guarantors hereunder shall not be
affected or impaired by (i) any payment on, or in reduction of, any such other
guaranty or undertaking, (ii) any dissolution, termination, or increase,
decrease, or change in personnel by any Grantor, (iii) any payment made to
Agent,

 

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Canadian Agent, any other member of the Lender Group, or any Canadian Bank
Product Provider on account of the Canadian Obligations which Agent, Canadian
Agent, such other member of the Lender Group, or such Canadian Bank Product
Provider repays to any Grantor pursuant to court order in any bankruptcy,
reorganization, arrangement, moratorium or other debtor relief proceeding (or
any settlement or compromise of any claim made in such a proceeding relating to
such payment), and each of the Guarantors waives any right to the deferral or
modification of its obligations hereunder by reason of any such proceeding, or
(iv) any action or inaction by Agent, Canadian Agent, any other member of the
Lender Group, or any Canadian Bank Product Provider, or (v) any invalidity,
irregularity, avoidability, or unenforceability of all or any part of the
Canadian Obligations or of any security therefor.

(d) This Guaranty includes all present and future Guarantied Obligations
including any under transactions continuing, compromising, extending,
increasing, modifying, releasing, or renewing the Guarantied Obligations,
changing the interest rate, payment terms, or other terms and conditions
thereof, or creating new or additional Guarantied Obligations after prior
Guarantied Obligations have been satisfied in whole or in part. To the maximum
extent permitted by law, each Guarantor hereby waives any right to revoke this
Guaranty as to future Guarantied Obligations. If such a revocation is effective
notwithstanding the foregoing waiver, each Guarantor acknowledges and agrees
that (i) no such revocation shall be effective until written notice thereof has
been received by Agent and Canadian Agent, (ii) no such revocation shall apply
to any Guarantied Obligations in existence on the date of receipt by Agent and
Canadian Agent of such written notice (including any subsequent continuation,
extension, or renewal thereof, or change in the interest rate, payment terms, or
other terms and conditions thereof), (iii) no such revocation shall apply to any
Guarantied Obligations made or created after such date to the extent made or
created pursuant to a legally binding commitment of any member of the Lender
Group or any Canadian Bank Product Provider in existence on the date of such
revocation, (iv) no payment by any Guarantor, any Canadian Borrower, or from any
other source, prior to the date of Agent’s and Canadian Agent’s receipt of
written notice of such revocation shall reduce the maximum obligation of such
Guarantor hereunder, and (v) any payment by any Canadian Borrower or from any
source other than such Guarantor subsequent to the date of such revocation shall
first be applied to that portion of the Guarantied Obligations as to which the
revocation is effective and which are not, therefore, guarantied hereunder, and
to the extent so applied shall not reduce the maximum obligation of such
Guarantor hereunder. This Guaranty shall be binding upon each Guarantor, its
successors and assigns and inure to the benefit of and be enforceable by Agent
and Canadian Agent (for the benefit of the Lender Group and the Canadian Bank
Product Providers) and its successors, transferees, or assigns.

(e) The guaranty by each of the Guarantors hereunder is a guaranty of payment
and not of collection. The obligations of each of the Guarantors hereunder are
independent of the obligations of any other Guarantor or Grantor or any other
Person and a separate action or actions may be brought and prosecuted against
one or more of the Guarantors whether or not action is brought against any other
Guarantor or Grantor or any other Person and whether or not any other Guarantor
or Grantor or any other Person be joined in any such action or actions. Each of
the Guarantors waives, to the fullest extent permitted by law, the benefit of
any statute of limitations affecting its liability hereunder or the enforcement
hereof. Any payment by any Grantor or other circumstance which operates to toll
any statute of limitations as to any Grantor shall operate to toll the statute
of limitations as to each of the Guarantors.

 

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(f) Each of the Guarantors authorizes Agent, Canadian Agent, the other members
of the Lender Group, and the Canadian Bank Product Providers without notice or
demand, and without affecting or impairing its liability hereunder, from time to
time to:

 

  (i) change the manner, place, or terms of payment of, or change or extend the
time of payment of, renew, increase, accelerate, or alter: (A) any of the
Canadian Obligations (including any increase or decrease in the principal amount
thereof or the rate of interest or fees thereon); or (B) any security therefor
or any liability incurred directly or indirectly in respect thereof, and this
Guaranty shall apply to the Canadian Obligations as so changed, extended,
renewed, or altered;

 

  (ii) take and hold security for the payment of the Canadian Obligations and
sell, exchange, release, impair, surrender, realize upon, collect, settle, or
otherwise deal with in any manner and in any order any property at any time
pledged or mortgaged to secure the Canadian Obligations or any of the Guarantied
Obligations (including any of the obligations of all or any of the Guarantors
under this Guaranty) incurred directly or indirectly in respect thereof or
hereof, or any offset on account thereof;

 

  (iii) exercise or refrain from exercising any rights against any Grantor;

 

  (iv) release or substitute any one or more endorsers, guarantors, any Grantor,
or other obligors;

 

  (v) settle or compromise any of the Canadian Obligations, any security
therefor, or any liability (including any of those of any of the Guarantors
under this Guaranty) incurred directly or indirectly in respect thereof or
hereof, and may subordinate the payment of all or any part thereof to the
payment of any liability (whether due or not) of any Grantor to its creditors;

 

  (vi) apply any sums by whomever paid or however realized to any liability or
liabilities of any Grantor to Agent, Canadian Agent, any other member of the
Lender Group, or any Canadian Bank Product Provider regardless of what liability
or liabilities of such Grantor remain unpaid;

 

  (vii) consent to or waive any breach of, or any act, omission, or default
under, this Agreement, any other Loan Document, any Canadian Bank Product
Agreement, or any of the instruments or agreements referred to herein or
therein, or otherwise amend, modify, or supplement this Agreement, any other
Loan Document, any Canadian Bank Product Agreement, or any of such other
instruments or agreements; or

 

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  (viii) take any other action that could, under otherwise applicable principles
of law, give rise to a legal or equitable discharge of one or more of the
Guarantors from all or part of its liabilities under this Guaranty.

(g) It is not necessary for Agent, any other member of the Lender Group, or any
Canadian Bank Product Provider to inquire into the capacity or powers of any of
the Guarantors or the officers, directors, partners or agents acting or
purporting to act on their behalf, and any Canadian Obligations made or created
in reliance upon the professed exercise of such powers shall be Guarantied
hereunder.

(h) Each Guarantor jointly and severally guarantees that the Guarantied
Obligations will be paid strictly in accordance with the terms of the Loan
Documents, regardless of any law, regulation, or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of any
member of the Lender Group or any Canadian Bank Product Provider with respect
thereto. The obligations of each Guarantor under this Guaranty are independent
of the Guarantied Obligations, and a separate action or actions may be brought
and prosecuted against each Guarantor to enforce such obligations, irrespective
of whether any action is brought against any other Guarantor or whether any
other Guarantor is joined in any such action or actions. The liability of each
Guarantor under this Guaranty shall be absolute and unconditional irrespective
of, and each Guarantor hereby irrevocably waives any defense it may now or
hereafter have in any way relating to, any or all of the following:

 

  (i) any lack of validity or enforceability of any Loan Document or any
agreement or instrument relating thereto;

 

  (ii) any change in the time, manner, or place of payment of, or in any other
term of, all or any of the Guarantied Obligations, or any other amendment or
waiver of or any consent to departure from any Loan Document, including any
increase in the Guarantied Obligations resulting from the extension of
additional credit;

 

  (iii) any taking, exchange, release, or non-perfection of any Lien in and to
any Collateral, or any taking, release, amendment, waiver of, or consent to
departure from any other guaranty, for all or any of the Guarantied Obligations;

 

  (iv) the existence of any claim, set-off, defense, or other right that any
Guarantor may have at any time against any Person, including Agent, Canadian
Agent, any other member of the Lender Group, or any Canadian Bank Product
Provider;

 

  (v) any defense, set-off, counterclaim, or claim, of any kind or nature,
arising directly or indirectly from the present or future lack of perfection,
sufficiency, validity, or enforceability of the Guarantied Obligations or any
security therefor;

 

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  (vi) any right or defense arising by reason of any claim or defense based upon
an election of remedies by any member of the Lender Group or any Canadian Bank
Product Provider including any defense based upon an impairment or elimination
of such Guarantor’s rights of subrogation, reimbursement, contribution, or
indemnity of such Guarantor against any other Grantor or any guarantors or
sureties;

 

  (vii) any change, restructuring, or termination of the corporate, limited
liability company, or partnership structure or existence of any Grantor; or

 

  (viii) any other circumstance that might otherwise constitute a defense
available to, or a discharge of, any Grantor or any other guarantor or surety.

(i) Waivers:

 

  (i) Each of the Guarantors waives any right (except as shall be required by
applicable statute and cannot be waived) to require Agent, any other member of
the Lender Group, or any Canadian Bank Product Provider to (i) proceed against
any other Grantor or any other Person, (ii) proceed against or exhaust any
security held from any other Grantor or any other Person, or (iii) protect,
secure, perfect, or insure any security interest or Lien on any property subject
thereto or exhaust any right to take any action against any other Grantor, any
other Person, or any collateral, or (iv) pursue any other remedy in any member
of the Lender Group’s or any Canadian Bank Product Provider’s power whatsoever.
Each of the Guarantors waives any defense based on or arising out of any defense
of any Grantor or any other Person, other than payment of the Canadian
Obligations to the extent of such payment, based on or arising out of the
disability of any Grantor or any other Person, or the validity, legality, or
unenforceability of the Canadian Obligations or any part thereof from any cause,
or the cessation from any cause of the liability of any Grantor other than
payment of the Canadian Obligations to the extent of such payment. Agent may, at
the election of the Required Lenders, foreclose upon any Collateral held by
Agent by one or more judicial or nonjudicial sales or other dispositions,
whether or not every aspect of any such sale is commercially reasonable or
otherwise fails to comply with applicable law or may exercise any other right or
remedy Agent, any other member of the Lender Group, or any Canadian Bank Product
Provider may have against any Grantor or any other Person, or any security, in
each case, without affecting or impairing in any way the liability of any of the
Guarantors hereunder except to the extent the Obligations have been paid.

 

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  (ii) Each of the Guarantors waives all presentments, demands for performance,
protests and notices, including notices of nonperformance, notices of protest,
notices of dishonor, notices of acceptance of this Guaranty, and notices of the
existence, creation, or incurring of new or additional Obligations or other
financial accommodations (other than any notice specifically required to be
given to a Guarantor under this Guaranty or any other Loan Document to which
such Grantor is a party). Each of the Guarantors waives notice of any Default or
Event of Default under any of the Loan Documents. Each of the Guarantors assumes
all responsibility for being and keeping itself informed of each Grantor’s
financial condition and assets and of all other circumstances bearing upon the
risk of nonpayment of the Canadian Obligations and the nature, scope, and extent
of the risks which each of the Guarantors assumes and incurs hereunder, and
agrees that neither Agent nor any of the other members of the Lender Group nor
any Canadian Bank Product Provider shall have any duty to advise any of the
Guarantors of information known to them regarding such circumstances or risks.

 

  (iii) To the fullest extent permitted by applicable law, each Guarantor hereby
waives: (A) any right to assert against any member of the Lender Group or any
Canadian Bank Product Provider, any defense (legal or equitable), set-off,
counterclaim, or claim which each Guarantor may now or at any time hereafter
have against any Borrower or any other party liable to any member of the Lender
Group or any Canadian Bank Product Provider (other than the defense that the
Guarantied Obligations have been finally and indefeasibly paid in full); (B) any
defense, set-off, counterclaim, or claim, of any kind or nature, arising
directly or indirectly from the present or future lack of perfection,
sufficiency, validity, or enforceability of the Guarantied Obligations or any
security therefor (other than the defense that the Guarantied Obligations have
been finally and indefeasibly paid in full); (C) any right or defense arising by
reason of any claim or defense based upon an election of remedies by any member
of the Lender Group or any Canadian Bank Product Provider including any defense
based upon an impairment or elimination of such Guarantor’s rights of
subrogation, reimbursement, contribution, or indemnity of such Guarantor against
any Borrower or other guarantors or sureties (other than the defense that the
Guarantied Obligations have been finally and indefeasibly paid in full); and
(D) the benefit of any statute of limitations affecting such Guarantor’s
liability hereunder or the enforcement thereof, and any act which shall defer or
delay the operation of any statute of limitations applicable to the Guarantied
Obligations shall similarly operate to defer or delay the operation of such
statute of limitations applicable to such Guarantor’s liability hereunder.

 

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  (iv) No Guarantor will exercise any rights that it may now or hereafter
acquire against any Grantor or any other guarantor that arise from the
existence, payment, performance or enforcement of such Guarantor’s obligations
under this Guaranty, including any right of subrogation, reimbursement,
exoneration, contribution or indemnification and any right to participate in any
claim or remedy of Agent, Canadian Agent, any other member of the Lender Group,
or any Canadian Bank Product Provider against any Grantor or any other guarantor
or any Collateral, whether or not such claim, remedy or right arises in equity
or under contract, statute or common law, including the right to take or receive
from any Grantor or any other guarantor, directly or indirectly, in cash or
other property or by set-off or in any other manner, payment or security solely
on account of such claim, remedy or right, unless and until all of the
Guarantied Obligations and all other amounts payable under this Guaranty shall
have been paid in full in cash and all of the Revolver Commitments have been
terminated. If any amount shall be paid to any Guarantor in violation of the
immediately preceding sentence, such amount shall be held in trust for the
benefit of Agent, for the benefit of the Lender Group and the Canadian Bank
Product Providers, and shall forthwith be paid to Agent or Canadian Agent, as
applicable, to be credited and applied to the Guarantied Obligations and all
other amounts payable under this Guaranty, whether matured or unmatured, in
accordance with the terms of the Credit Agreement, or to be held as Collateral
for any Guarantied Obligations or other amounts payable under this Guaranty
thereafter arising. Notwithstanding anything to the contrary contained in this
Guaranty, no Guarantor may exercise any rights of subrogation, contribution,
indemnity, reimbursement or other similar rights against, and may not proceed or
seek recourse against or with respect to any property or asset of, any other
Grantor (the “Foreclosed Grantor”), including after payment in full of the
Canadian Obligations, if all or any portion of the Canadian Obligations have
been satisfied in connection with an exercise of remedies in respect of the
Equity Interests of such Foreclosed Grantor whether pursuant to this Agreement
or otherwise.

 

  (v) Intentionally deleted.

 

  (vi) Each of the Guarantors represents, warrants, and agrees that each of the
waivers set forth above is made with full knowledge of its significance and
consequences and that if any of such waivers are determined to be contrary to
any applicable law or public policy, such waivers shall be effective to the
maximum extent permitted by law.

 

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(j) This Guaranty shall become effective only when a Guarantor becomes a party
to this Agreement in accordance with the terms hereof and shall terminate upon
the earlier of (a) the indefeasible payment in full of all Canadian Obligations
under the Credit Agreement and termination of all commitments of the Lenders and
any Issuing Lender under the Credit Agreement, and (b) release by Agent of each
Guarantor from its obligations under this Guaranty.

(k) The provisions of this Guaranty are severable, and in any action or
proceeding involving any state or provincial corporate law, or any state,
provincial, federal or foreign bankruptcy, insolvency, reorganization or other
law affecting the rights of creditors generally, if the obligations of any
Guarantor under this Guaranty would otherwise be held or determined to be
avoidable, invalid or unenforceable on account of the amount of such Guarantor’s
liability under this Guaranty, then, notwithstanding any other provision of this
Guaranty to the contrary, the amount of such liability shall, without any
further action by the Guarantors or the Lenders, be automatically limited and
reduced to the highest amount that is valid and enforceable as determined in
such action or proceeding (such highest amount determined hereunder being the
relevant Guarantor’s “Maximum Liability”). This Section with respect to the
Maximum Liability of each Guarantor is intended solely to preserve the rights of
the Lenders to the maximum extent not subject to avoidance under applicable law,
and no Guarantor nor any other person or entity shall have any right or claim
under this Section with respect to such Maximum Liability, except to the extent
necessary so that the obligations of any Guarantor hereunder shall not be
rendered voidable under applicable law. Each Guarantor agrees that the
Guarantied Obligations may at any time and from time to time exceed the Maximum
Liability of each Guarantor without impairing this Guaranty or affecting the
rights and remedies of the Lenders hereunder, provided that, nothing in this
sentence shall be construed to increase any Guarantor’s obligations hereunder
beyond its Maximum Liability.

3. Grant of Security. Each Grantor hereby unconditionally grants, assigns, and
pledges to Agent, for the benefit of each member of the Lender Group and each of
the Canadian Bank Product Providers, to secure the Secured Obligations, a
continuing security interest (hereinafter referred to as the “Security
Interest”) in all of such Grantor’s present and after-acquired personal
property, and all of such Grantor’s right, title, and interest in and to the
following, whether now owned or hereafter acquired or arising and wherever
located (the “Collateral”):

(a) all of such Grantor’s Accounts;

(b) all of such Grantor’s Books;

(c) all of such Grantor’s Chattel Paper;

(d) all of such Grantor’s Documents of Title;

(e) all of such Grantor’s Instruments;

(f) all of such Grantor’s Deposit Accounts;

 

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(g) all of such Grantor’s Equipment;

(h) all of such Grantor’s Goods;

(i) all of such Grantor’s fixtures;

(j) all of such Grantor’s General Intangibles;

(k) all of such Grantor’s Inventory;

(l) all of such Grantor’s Investment Property;

(m) all of such Grantor’s Intellectual Property and Intellectual Property
Licenses;

(n) all of such Grantor’s Negotiable Collateral (including all of such Grantor’s
Pledged Notes);

(o) all of such Grantor’s Pledged Interests (including all of such Grantor’s
Pledged Operating Agreements and Pledged Partnership Agreements);

(p) all of such Grantor’s Securities Accounts;

(q) all of such Grantor’s money, Cash Equivalents, or other assets of such
Grantor that now or hereafter come into the possession, custody, or control of
Agent (or its agent or designee) or any other member of the Lender Group; and

(r) all of the proceeds (as such term is defined in the PPSA) and products,
whether tangible or intangible, of any of the foregoing, including proceeds of
insurance covering or relating to any or all of the foregoing, and any and all
Accounts, Books, Chattel Paper, Deposit Accounts, Equipment, fixtures, General
Intangibles, Inventory, Investment Property, Intellectual Property, Negotiable
Collateral, Pledged Interests, Securities Accounts, Documents of Title, Money,
or other tangible or intangible property resulting from the sale, lease,
license, exchange, collection, or other disposition of any of the foregoing, the
proceeds of any award in condemnation with respect to any of the foregoing, any
rebates or refunds, whether for taxes or otherwise, and all proceeds of any such
proceeds, or any portion thereof or interest therein, and the proceeds thereof,
and all proceeds of any loss of, damage to, or destruction of the above, whether
insured or not insured, and, to the extent not otherwise included, any
indemnity, warranty, or guaranty payable by reason of loss or damage to, or
otherwise with respect to any of the foregoing (the “Proceeds”). Without
limiting the generality of the foregoing, the term “Proceeds” includes whatever
is receivable or received when Investment Property or proceeds are sold,
exchanged, collected, or otherwise disposed of, whether such disposition is
voluntary or involuntary, and includes proceeds of any indemnity or guaranty
payable to any Grantor or Agent from time to time with respect to any of the
Investment Property.

Notwithstanding anything contained in this Agreement to the contrary, the term
“Collateral” shall not include: (i) Investment Property or General Intangibles
constituting the voting Equity Interest of a Grantor in or to any Foreign
Subsidiary or foreign joint venture that is

 

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not a Subsidiary or joint venture organized under the laws of the United States
of America, (ii) any property subject to any negative pledge clauses or other
restrictions on assignment pursuant to Capital Leases, Synthetic Lease
Obligations or documentation regarding Purchase Money Indebtedness or other
purchase money security interests, or other property as contemplated under
clause (e)(iii) of the definition of Permitted Indebtedness in the Credit
Agreement, if the Liens granted pursuant to such Capital Leases, Synthetic Lease
Obligations or documentation regarding Purchase Money Indebtedness or other
purchase money security interests or documentation are Permitted Liens and the
Indebtedness incurred thereunder is permitted to be incurred under Section 6.1
of the Credit Agreement (provided that such property shall be considered
Collateral immediately and automatically when such property is not subject to
such documentation); (iii) any rights or interest in any contract, lease,
permit, license, or license agreement covering real or personal property of any
Grantor if under the terms of such contract, lease, permit, license, or license
agreement, or applicable law with respect thereto, the grant of a security
interest or lien therein would result in the abandonment, invalidation,
unlawfulness or unenforceability of any right or interest of any Grantor therein
or is prohibited as a matter of law or under the terms of such contract, lease,
permit, license, or license agreement and such prohibition or restriction has
not been waived or the consent of the other party to such contract, lease,
permit, license, or license agreement has not been obtained (provided, that,
(A) the foregoing exclusions of this clause (iii) shall in no way be construed
(1) to apply to the extent that any described prohibition or restriction is
ineffective or unenforceable under the PPSA or other applicable law, or (2) to
apply to the extent that any consent or waiver has been obtained that would
permit Agent’s security interest or lien to attach notwithstanding the
prohibition or restriction on the pledge of such contract, lease, permit,
license, or license agreement and (B) the foregoing exclusions of this clause
(iii) shall in no way be construed to limit, impair, or otherwise affect any of
Agent’s, any other member of the Lender Group’s or any Canadian Bank Product
Provider’s continuing security interests in and liens upon any rights or
interests of any Grantor in or to (1) monies due or to become due under or in
connection with any described contract, lease, permit, license, license
agreement, or Equity Interests (including any Accounts or Equity Interests), or
(2) any proceeds from the sale, license, lease, or other dispositions of any
such contract, lease, permit, license, license agreement, or Equity Interests);
or (iv) any fee or leasehold interests in Real Property prior to Agent’s request
for a Mortgage following the occurrence of an Event of Default; or (v) any motor
vehicles.

4. Security for Secured Obligations. The Security Interest created hereby
secures the payment and performance of the Secured Obligations, whether now
existing or arising hereafter. Without limiting the generality of the foregoing,
this Agreement secures the payment of all amounts which constitute part of the
Secured Obligations and would be owed by Grantors, or any of them, to Agent, the
Lender Group, the Canadian Bank Product Providers or any of them, but for the
fact that they are unenforceable or not allowable (in whole or in part) as a
claim in an Insolvency Proceeding involving any Grantor due to the existence of
such Insolvency Proceeding.

5. Grantors Remain Liable. Anything herein to the contrary notwithstanding,
(a) each of the Grantors shall remain liable under the contracts and agreements
included in the Collateral, including the Pledged Operating Agreements and the
Pledged Partnership Agreements, to perform all of the duties and obligations
thereunder to the same extent as if this Agreement had not been executed,
(b) the exercise by Agent or any other member of the Lender

 

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Group of any of the rights hereunder shall not release any Grantor from any of
its duties or obligations under such contracts and agreements included in the
Collateral, and (c) none of the members of the Lender Group shall have any
obligation or liability under such contracts and agreements included in the
Collateral by reason of this Agreement, nor shall any of the members of the
Lender Group be obligated to perform any of the obligations or duties of any
Grantors thereunder or to take any action to collect or enforce any claim for
payment assigned hereunder. Until an Event of Default shall occur and be
continuing, except as otherwise provided in this Agreement, the Credit
Agreement, or any other Loan Document, Grantors shall have the right to
possession and enjoyment of the Collateral for the purpose of conducting the
ordinary course of their respective businesses, subject to and upon the terms
hereof and of the Credit Agreement and the other Loan Documents. Without
limiting the generality of the foregoing, it is the intention of the parties
hereto that record and beneficial ownership of the Pledged Interests, including
all voting, consensual, dividend, and distribution rights, shall remain in the
applicable Grantor until (i) the occurrence and continuance of an Event of
Default and (ii) Agent has notified the applicable Grantor of Agent’s election
to exercise such rights with respect to the Pledged Interests pursuant to
Section 16.

6. Representations and Warranties. In order to induce Agent to enter into this
Agreement for the benefit of the Lender Group and the Canadian Bank Product
Providers, each Grantor makes the following representations and warranties to
the Lender Group which shall be true, correct, and complete, in all material
respects (except that such materiality qualifier shall not be applicable to any
representations and warranties that already are qualified or modified by
materiality in the text thereof), as of the Closing Date, and shall be true,
correct, and complete, in all material respects (except that such materiality
qualifier shall not be applicable to any representations and warranties that
already are qualified or modified by materiality in the text thereof), as of the
date of the making of each Advance (or other extension of credit) made
thereafter, as though made on and as of the date of such Advance (or other
extension of credit) (except to the extent that such representations and
warranties relate solely to an earlier date, in which case such representations
and warranties shall be true and correct in all material respects (except that
such materiality qualifier shall not be applicable to any representations and
warranties that already are qualified or modified by materiality in the text
thereof) as of such earlier date) and such representations and warranties shall
survive the execution and delivery of this Agreement:

(a) The name and jurisdiction of organization of each Grantor is set forth on
Schedule 6 (as such Schedule may be updated from time to time to reflect changes
resulting from transactions permitted under the Loan Documents).

(b) The chief executive office of each Grantor is located at the address
indicated on Schedule 6 (as such Schedule may be updated from time to time to
reflect changes resulting from transactions permitted under the Loan Documents).

(c) Each Grantor’s federal and provincial business numbers for tax purposes and
organizational identification numbers, if any, are identified on Schedule 6 (as
such Schedule may be updated from time to time to reflect changes resulting from
transactions permitted under the Loan Documents).

 

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(d) Set forth on Schedule 8 (as such Schedule may be updated from time to time
subject to Section 7(k)(iii) with respect to Controlled Accounts and provided
that Grantors comply with Section 7(c) hereof) is a listing of all of Grantors’
Deposit Accounts and Securities Accounts, including, with respect to each bank
or securities intermediary (a) the name and address of such Person, and (b) the
account numbers of the Deposit Accounts or Securities Accounts maintained with
such Person.

(e) Schedule 7 sets forth all Real Property owned by any of the Grantors as of
the Closing Date.

(f) As of the Closing Date: (i) Schedule 1 provides a complete and correct list
of all registered Copyrights owned by any Grantor, all applications for
registration of Copyrights owned by any Grantor; (ii) Schedule 2 provides a
complete and correct list of all Intellectual Property Licenses entered into by
any Grantor pursuant to which (A) any Grantor has provided any license or other
rights in Intellectual Property owned or controlled by such Grantor to any other
Person (other than non-exclusive software licenses granted in the ordinary
course of business) or (B) any Person has granted to any Grantor any license or
other rights in Intellectual Property owned or controlled by such Person that is
material to the business of such Grantor, including any Intellectual Property
that is incorporated in any Inventory, software, or other product marketed,
sold, licensed, or distributed by such Grantor; (iii) Schedule 3 provides a
complete and correct list of all Patents owned by any Grantor and all
applications for Patents owned by any Grantor; and (iv) Schedule 5 provides a
complete and correct list of all registered Trademarks owned by any Grantor, all
applications for registration of Trademarks owned by any Grantor, and all other
Trademarks owned by any Grantor and material to the conduct of the business of
any Grantor.

(g) (i) (A) each Grantor owns exclusively or holds licenses in all Intellectual
Property that is necessary in the conduct of its business, and (B) all employees
and contractors of each Grantor who were involved in the creation or development
of any Intellectual Property for such Grantor that is necessary in the business
of such Grantor have signed agreements containing assignment of Intellectual
Property rights to such Grantor and obligations of confidentiality, in each
case, except where failure to do so either individually or in the aggregate
could not reasonably be expected to result in a Material Adverse Change;

(ii) to each Grantor’s knowledge after reasonable inquiry, no Person has
infringed or misappropriated or is currently infringing or misappropriating any
Intellectual Property rights owned by such Grantor, in each case, that either
individually or in the aggregate could reasonably be expected to result in a
Material Adverse Change;

(iii) (A) to each Grantor’s knowledge after reasonable inquiry, except where
such infringement either individually or in the aggregate could not reasonably
be expected to result in a Material Adverse Change, (1) such Grantor has never
infringed or misappropriated and is not currently infringing or misappropriating
any Intellectual Property rights of any Person, and (2) no product manufactured,
used, distributed, licensed, or sold by or service provided by such Grantor has
ever infringed or misappropriated or is currently infringing or misappropriating
any Intellectual Property rights of any Person, in each case, except where such
infringement either individually or in the aggregate could not reasonably be
expected to result in a Material

 

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Adverse Change, and (B) there are no infringement or misappropriation claims or
proceedings pending, or to any Grantor’s knowledge after reasonable inquiry,
threatened in writing against any Grantor, and no Grantor has received any
written notice or other communication of any actual or alleged infringement or
misappropriation of any Intellectual Property rights of any Person, in each
case, except where such infringement either individually or in the aggregate
could not reasonably be expected to result in a Material Adverse Change;

(iv) to each Grantor’s knowledge after reasonable inquiry, all registered
Copyrights, registered Trademarks, and issued Patents that are owned by such
Grantor and necessary in the conduct of its business are valid, subsisting and
enforceable and in compliance with all legal requirements, filings, and payments
and other actions that are required to maintain such Intellectual Property in
full force and effect, except where the failure to do so either individually or
in the aggregate could not reasonably be expected to result in a Material
Adverse Change, and

(v) each Grantor has taken reasonable steps to maintain the confidentiality of
and otherwise protect and enforce its rights in all trade secrets owned by such
Grantor that are necessary in the conduct of the business of such Grantor,
except where the failure to do so either individually or in the aggregate could
not reasonably be expected to result in a Material Adverse Change.

(h) This Agreement creates a valid security interest in the Collateral of each
Grantor, to the extent a security interest therein can be created under the
PPSA, securing the payment of the Secured Obligations. Except to the extent a
security interest in the Collateral cannot be perfected by the filing of a
financing statement under the PPSA, all filings and other actions necessary or
desirable to perfect and protect such security interest have been duly taken or
will have been taken upon the filing of financing statements listing each
applicable Grantor, as a debtor, and Agent, as secured party, in the
jurisdictions listed next to such Grantor’s name on Schedule 10. Upon the making
of such filings, Agent shall have a first priority perfected security interest
in the Collateral of each Grantor except for Permitted Liens which are
non-consensual Permitted Liens, permitted purchase money Liens or, the interests
of lessors under Capital Leases or permitted pursuant to clause (p) of the
definition of Permitted Liens to the extent such security interest can be
perfected by the filing of a financing statement. Upon filing of the Copyright
Security Agreement, the Patent Security Agreement and the Trademark Security
Agreement with CIPO, and the filing of appropriate financing statements in the
jurisdictions listed on Schedule 10, all action necessary or desirable to
protect and perfect the Security Interest in and on each Grantor’s Patents,
Trademarks, or Copyrights has been taken and such perfected Security Interest is
enforceable as such as against any and all creditors of and purchasers from any
Grantor to the extent the Security Interest in such Patents, Trademarks and
Copyrights are able to be perfected by such filings. All action by any Grantor
necessary to protect and perfect such security interest on each item of
Collateral has been duly taken.

(i) (i) Except for the Security Interest created hereby, (A) each Grantor has
good and marketable title to (with respect to personal property) of its portion
of the Collateral, free and clear of all Liens other than Permitted Liens, and
(B) each Grantor is and will at all times be the sole holder of record and the
legal and beneficial owner, free and clear of all Liens other than Permitted
Liens, of the Pledged Interests indicated on Schedule 4 as being owned by

 

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such Grantor and, when acquired by such Grantor, any Pledged Interests acquired
after the Closing Date; (ii) all of the Pledged Interests are duly authorized,
validly issued, fully paid and nonassessable and the Pledged Interests
constitute or will constitute the percentage of the issued and outstanding
Equity Interests of the Pledged Companies of such Grantor identified on Schedule
4 as supplemented or modified by any Pledged Interests Addendum or any Joinder
to this Agreement; (iii) such Grantor has the right and requisite authority to
pledge, the Investment Property pledged by such Grantor to Agent as provided
herein; (iv) all actions necessary or desirable to perfect and establish the
first priority of, or otherwise protect, any Agent’s Liens in the Investment
Property, and the proceeds thereof, have been duly taken, upon (A) the execution
and delivery of this Agreement; (B) the taking of possession by Agent (or its
agent or designee) of any certificates representing the Pledged Interests,
together with undated powers (or other documents of transfer acceptable to
Agent) endorsed in blank by the applicable Grantor; (C) the filing of financing
statements in the applicable jurisdiction set forth on Schedule 10 for such
Grantor with respect to the Pledged Interests of such Grantor that are not
represented by certificates or which are represented by certificates but are not
securities pursuant to Section 12(b) of the STA, and (D) with respect to any
Securities Accounts, the delivery of Control Agreements with respect thereto;
and (v) each Grantor has delivered to and deposited with Agent all certificates
representing the Pledged Interests owned by such Grantor to the extent such
Pledged Interests are represented by certificates, and undated powers (or other
documents of transfer acceptable to Agent) endorsed in blank with respect to
such certificates. None of the Pledged Interests owned or held by such Grantor
has been issued or transferred in violation of any securities registration,
securities disclosure, or similar laws of any jurisdiction to which such
issuance or transfer may be subject.

(j) No consent, approval, authorization, or other order or other action by, and
no notice to or filing with, any Governmental Authority or any other Person is
required (i) for the grant of a Security Interest by such Grantor in and to the
Collateral pursuant to this Agreement or for the execution, delivery, or
performance of this Agreement by such Grantor, except for consents, approvals,
authorizations, orders, other actions, notices and filings that (A) by their
nature can only be obtained or made after the date hereof, or (B) the failure of
which to obtain could not reasonably be expected to result in a Material Adverse
Change, or (ii) for the exercise by Agent of the voting or other rights provided
for in this Agreement with respect to the Investment Property or the remedies in
respect of the Collateral pursuant to this Agreement, except as may be required
in connection with such disposition of Investment Property by laws affecting the
offering and sale of securities generally and except for consents, approvals,
authorizations, or other orders or actions that have been obtained or given (as
applicable) and that are still in force. No Intellectual Property License of any
Grantor that is necessary in or material to the conduct of such Grantor’s
business requires any consent of any other Person that has not been obtained in
order for such Grantor to grant the security interest granted hereunder in such
Grantor’s right, title or interest in or to such Intellectual Property License.

(k) There is no default, breach, violation, or event of acceleration existing
under any promissory note constituting Collateral and pledged hereunder (each a
“Pledged Note”) and no event has occurred or circumstance exists which, with the
passage of time or the giving of notice, or both, would constitute a default,
breach, violation, or event of acceleration under any Pledged Note. No Grantor
that is an obligee under a Pledged Note has waived any default, breach,
violation, or event of acceleration under such Pledged Note.

 

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(l) As to all limited liability company or partnership interests, issued under
any Pledged Operating Agreement or Pledged Partnership Agreement, each Grantor
hereby represents and warrants that the Pledged Interests issued pursuant to
such agreement (A) are not dealt in or traded on securities exchanges or in
securities markets, (B) do not constitute investment company securities, and
(C) are not held by such Grantor in a Securities Account. In addition, none of
the Pledged Operating Agreements, the Pledged Partnership Agreements, or any
other agreements governing any of the Pledged Interests issued under any Pledged
Operating Agreement or Pledged Partnership Agreement, provide that such Pledged
Interests are securities governed by the STA.

7. Covenants. Each Grantor, jointly and severally, covenants and agrees with
Agent that from and after the date of this Agreement and until the date of
termination of this Agreement in accordance with Section 23:

(a) Possession of Collateral. In the event that any Collateral, including
Proceeds, is evidenced by or consists of Negotiable Collateral, Investment
Property, or Chattel Paper having an aggregate value or face amount of
US$250,000 or more for all such Negotiable Collateral, Investment Property, or
Chattel Paper, the Grantors shall promptly (and in any event within five
(5) Business Days after receipt thereof), notify Agent thereof, and if and to
the extent that perfection or priority of Agent’s Security Interest is dependent
on or enhanced by possession, the applicable Grantor, promptly (and in any event
within five (5) Business Days) after request by Agent, shall execute such other
documents and instruments as shall be requested by Agent or, if applicable,
endorse and deliver physical possession of such Negotiable Collateral,
Investment Property, or Chattel Paper to Agent, together with such undated
powers (or other relevant document of transfer acceptable to Agent) endorsed in
blank as shall be requested by Agent, and shall do such other acts or things
deemed necessary or desirable by Agent to protect Agent’s Security Interest
therein;

(b) Chattel Paper.

 

  (i) Promptly (and in any event within five (5) Business Days) after request by
Agent, each Grantor shall take all steps reasonably necessary to grant Agent
control of all electronic Chattel Paper in accordance with the PPSA (to the
extent that the PPSA contains provisions with respect to electronic Chattel
Paper and the perfection of security interests therein) to the extent that the
aggregate value or face amount of such electronic Chattel Paper equals or
exceeds US$250,000;

 

  (ii) If any Grantor retains possession of any Chattel Paper or instruments
(which retention of possession shall be subject to the extent permitted hereby
and by the Credit Agreement), promptly upon the request of Agent, such Chattel
Paper and instruments shall be marked with the following legend: “This writing
and the obligations evidenced or secured hereby are subject to the Security
Interest of Wells Fargo Bank, National Association, as Agent for the benefit of
the Lender Group and the Canadian Bank Product Providers”;

 

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(c) Control Agreements.

 

  (i) Except to the extent otherwise excused by Section 7(k)(iii), each Grantor
shall obtain an authenticated Control Agreement (which may include a Controlled
Account Agreement), from each bank maintaining a Deposit Account or Securities
Account for such Grantor;

 

  (ii) Except to the extent otherwise excused by Section 7(k)(iii), each Grantor
shall obtain an authenticated Control Agreement, from each issuer of
uncertificated securities, securities intermediary, or commodities intermediary
issuing or holding any financial assets or commodities to or for any Grantor, or
maintaining a Securities Account for such Grantor; and

 

  (iii) Except to the extent delivered to the possession of the Agent or
otherwise excused by Section 7(k)(iii), each Grantor shall obtain an
authenticated Control Agreement with respect to all of such Grantor’s investment
property that constitutes Collateral hereunder;

(d) Reserved.

(e) Reserved.

(f) Government Contracts. Other than Accounts and Chattel Paper the aggregate
value of which does not at any one time exceed US$500,000, if any Account or
Chattel Paper arises out of a contract or contracts with Canada or province or
territory thereof, or any department, agency, or instrumentality thereof,
Grantors shall promptly (and in any event within five (5) Business Days of the
creation thereof) notify Agent thereof and, promptly (and in any event within
five (5) Business Days) after request by Agent, execute any instruments or take
any steps reasonably required by Agent in order that all moneys due or to become
due under such contract or contracts shall be assigned to Agent, for the benefit
of the Lender Group and the Canadian Bank Product Providers, in accordance with
the Financial Administration Act (Canada) or other applicable law; provided
that, so long as no Event of Default shall have occurred, Agent shall not
require Grantors to execute any such instruments or take any such steps with
respect to such contracts;

(g) Intellectual Property.

 

  (i) Upon the request of Agent, in order to facilitate filings with CIPO, each
Grantor shall execute and deliver to Agent one or more Copyright Security
Agreements, Trademark Security Agreements, or Patent Security Agreements to
further evidence Agent’s Lien on such Grantor’s Patents, Trademarks, or
Copyrights, and the General Intangibles of such Grantor relating thereto or
represented thereby;

 

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  (ii) Subject to such Grantor’s past business practice and reasonable business
judgment regarding the appropriate use of its resources, each Grantor shall have
the duty, with respect to Intellectual Property that is necessary in or material
to the conduct of such Grantor’s business, to protect and diligently enforce and
defend at such Grantor’s expense its Intellectual Property, including (A) to
diligently enforce and defend, including promptly suing for infringement,
misappropriation, or dilution and to recover any and all damages for such
infringement, misappropriation, or dilution, and filing for opposition,
interference, and cancellation against conflicting Intellectual Property rights
of any Person, (B) to prosecute diligently any trademark application or service
mark application that is part of the Trademarks pending as of the date hereof or
hereafter until the termination of this Agreement, (C) to prosecute diligently
any patent application that is part of the Patents pending as of the date hereof
or hereafter until the termination of this Agreement, (D) to take all reasonable
and necessary action to preserve and maintain all of such Grantor’s Trademarks,
Patents, Copyrights, Intellectual Property Licenses, and its rights therein,
including paying all maintenance fees and filing of applications for renewal,
affidavits of use, and affidavits of noncontestability, and (E) to require all
employees, consultants, and contractors of each Grantor who were involved in the
creation or development of such Intellectual Property to sign agreements
containing assignment of Intellectual Property rights and obligations of
confidentiality. Subject to such Grantor’s past business practice and reasonable
business judgment regarding the appropriate use of its resources, each Grantor
further agrees not to abandon any Intellectual Property or Intellectual Property
License that is necessary in or material to the conduct of such Grantor’s
business. Each Grantor hereby agrees to take the steps described in this
Section 7(g)(ii) with respect to all new or acquired Intellectual Property to
which it is now or later becomes entitled that is necessary in or material to
the conduct of such Grantor’s business;

 

  (iii)

Grantors acknowledge and agree that the Lender Group shall have no duties with
respect to any Intellectual Property or Intellectual Property Licenses of any
Grantor. Without limiting the generality of this Section 7(g)(iii), Grantors
acknowledge and agree that no member of the Lender Group shall be under any
obligation to take any steps necessary to preserve rights in the Collateral
consisting of Intellectual Property or Intellectual Property Licenses against
any other Person, but any member of the Lender Group may do so

 

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  at its option from and after the occurrence and during the continuance of an
Event of Default, and all expenses incurred in connection therewith (including
reasonable fees and expenses of attorneys and other professionals) shall be for
the sole account of Borrowers and shall be chargeable to the Loan Account;

 

  (iv) On each date on which a Compliance Certificate is to be delivered
pursuant to Section 5.1 of the Credit Agreement in respect of a fiscal quarter
(or, if an Event of Default has occurred and is continuing, more frequently if
requested by Agent), each Grantor shall provide Agent with a written report of
all new Patents, Trademarks or Copyrights that are registered or the subject of
pending applications for registrations, and of all Intellectual Property
Licenses that are material to the conduct of such Grantor’s business, in each
case, which were acquired, registered, or for which applications for
registration were filed by any Grantor during the prior period and any statement
of use or amendment to allege use with respect to intent-to-use trademark
applications. In the case of such registrations or applications therefor, which
were acquired by any Grantor, each such Grantor shall file the necessary
documents with the appropriate Governmental Authority identifying the applicable
Grantor as the owner (or as a co-owner thereof, if such is the case) of such
Intellectual Property. In each of the foregoing cases, the applicable Grantor
shall promptly cause to be prepared, executed, and delivered to Agent
supplemental schedules to the applicable Loan Documents to identify such Patent,
Trademark and Copyright registrations and applications therefor (with the
exception of Trademark applications filed on an intent-to-use basis for which no
statement of use or amendment to allege use has been filed) and Intellectual
Property Licenses as being subject to the security interests created thereunder;

 

  (v)

Anything to the contrary in this Agreement notwithstanding, in no event shall
any Grantor, either itself or through any agent, employee, licensee, or
designee, file an application for the registration of any Copyright with CIPO or
any similar office or agency in another country without giving Agent written
notice thereof at least five (5) Business Days prior to such filing and
complying with Section 7(g)(i). Upon receipt from CIPO of notice of registration
of any Copyright, each Grantor shall promptly (but in no event later than five
(5) Business Days following such receipt) notify (but without duplication of any
notice required by Section 7(g)(v)) Agent of such registration by delivering, or
causing to be delivered, to Agent, documentation sufficient for Agent to perfect
its Liens on such Copyright. If any Grantor acquires from any Person any
Copyright registered with CIPO or an application to register any Copyright with
CIPO, such Grantor

 

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  shall promptly (but in no event later than five (5) Business Days following
such acquisition) notify Agent of such acquisition and deliver, or cause to be
delivered, to Agent, documentation sufficient for Agent to perfect its Liens on
such Copyright. In the case of such Copyright registrations or applications
therefor which were acquired by any Grantor, each such Grantor shall promptly
(but in no event later than five (5) Business Days following such acquisition)
file the necessary documents with the appropriate Governmental Authority
identifying the applicable Grantor as the owner (or as a co-owner thereof, if
such is the case) of such Copyrights;

 

  (vi) Subject to such Grantor’s past business practices and reasonable business
judgment regarding the appropriate use of its resources, each Grantor shall take
reasonable steps to maintain the confidentiality of, and otherwise protect and
enforce its rights in, the Intellectual Property that is necessary in or
material to the conduct of such Grantor’s business, including, as applicable
(A) protecting the secrecy and confidentiality of its confidential information
and trade secrets by having and enforcing a policy requiring all current
employees, consultants, licensees, vendors and contractors with access to such
information to execute appropriate confidentiality agreements; (B) taking
actions reasonably necessary to ensure that no trade secret falls into the
public domain; and (C) protecting the secrecy and confidentiality of the source
code of all software programs and applications of which it is the owner or
licensee by having and enforcing a policy requiring any licensees (or
sublicensees) of such source code to enter into license agreements with
commercially reasonable use and non-disclosure restrictions; and

 

  (vii) No Grantor shall enter into any Intellectual Property License material
to the conduct of the business to receive any license or rights in any
Intellectual Property of any other Person unless such Grantor has used
commercially reasonable efforts to permit the assignment of or grant of a
security interest in such Intellectual Property License (and all rights of
Grantor thereunder) to Agent (and any transferees of Agent).

(h) Investment Property.

 

  (i) If any Grantor shall acquire, obtain, receive or become entitled to
receive any Pledged Interests after the Closing Date, it shall promptly (and in
any event within five (5) Business Days of acquiring or obtaining such
Collateral) deliver to Agent a duly executed Pledged Interests Addendum
identifying such Pledged Interests;

 

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  (ii) Upon the occurrence and during the continuance of an Event of Default,
following the request of Agent, all sums of money and property paid or
distributed in respect of the Investment Property that are received by any
Grantor shall be held by such Grantor in trust for the benefit of Agent
segregated from such Grantor’s other property, and such Grantor shall deliver it
forthwith to Agent in the exact form received;

 

  (iii) Each Grantor shall promptly deliver to Agent a copy of each material
notice or other material communication received by it in respect of any Pledged
Interests;

 

  (iv) No Grantor shall make or consent to any amendment or other modification
or waiver with respect to any Pledged Interests, Pledged Operating Agreement, or
Pledged Partnership Agreement, or enter into any agreement or permit to exist
any restriction with respect to any Pledged Interests if the same is prohibited
pursuant to the Loan Documents;

 

  (v) Each Grantor agrees that it will cooperate with Agent in obtaining all
necessary approvals and making all necessary filings under federal, provincial,
state, local, or foreign law to effect the perfection of the Security Interest
on the Investment Property or to effect any sale or transfer thereof;

 

  (vi) As to all limited liability company or partnership interests, issued
under any Pledged Operating Agreement or Pledged Partnership Agreement, each
Grantor hereby covenants that the Pledged Interests issued pursuant to such
agreement (A) are not and shall not be dealt in or traded on securities
exchanges or in securities markets, (B) do not and will not constitute
investment company securities, and (C) are not and will not be held by such
Grantor in a securities account. In addition, none of the Pledged Operating
Agreements, the Pledged Partnership Agreements, or any other agreements
governing any of the Pledged Interests issued under any Pledged Operating
Agreement or Pledged Partnership Agreement, provide or shall provide that such
Pledged Interests are securities governed by the STA.

(i) Real Property; Fixtures. No Grantor shall (i) grant, assign, or pledge to to
any Person security interest in all or any portion of such Grantor’s right,
title, and interest in and to its Real Property, or (ii) create or permit to
exist any Lien upon or with respect to any of the Real Property of any Grantor,
except for Permitted Liens. Each Grantor acknowledges and agrees that, to the
extent permitted by applicable law, all of the Collateral shall remain personal
property regardless of the manner of its attachment or affixation to real
property;

 

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(j) Transfers and Other Liens. Grantors shall not (i) sell, assign (by operation
of law or otherwise) or otherwise dispose of, or grant any option with respect
to, any of the Collateral, except as expressly permitted by the Credit
Agreement, or (ii) create or permit to exist any Lien upon or with respect to
any of the Collateral of any Grantor, except for Permitted Liens. The inclusion
of Proceeds in the Collateral shall not be deemed to constitute Agent’s,
Canadian Agent’s, or any other members of the Lender Group’s, consent to any
sale or other disposition of any of the Collateral except as expressly permitted
in this Agreement or the other Loan Documents;

(k) Controlled Accounts; Controlled Investments. Without limiting the provisions
of Section 3.6 of the Credit Agreement, each Grantor shall (A) establish and
maintain cash management services of a type and on terms reasonably satisfactory
to Agent at one or more of the banks set forth on Schedule 9 (each a “Controlled
Account Bank”), and shall take reasonable steps to ensure that all of its
applicable Account Debtors forward payment of the amounts owed by them directly
to such Controlled Account Bank, and (B) deposit or cause to be deposited
promptly, and in any event no later than the first Business Day after the date
of receipt thereof, all of their Collections (including those sent directly by
their Account Debtors to a Grantor) into a bank account of such Grantor (each a
“Controlled Account”) at one of the Controlled Account Banks.

 

  (i) Except as provided in Section 7(k)(iii), each Grantor shall establish and
maintain Controlled Account Agreements with Agent and the applicable Controlled
Account Bank, in form and substance reasonably acceptable to Agent. Each such
Controlled Account Agreement shall provide, among other things, that (A) the
Controlled Account Bank will comply with any instructions originated by Agent
directing the disposition of the funds in such Controlled Account without
further consent by the applicable Grantor, (B) the Controlled Account Bank
waives, subordinates, or agrees not to exercise any rights of setoff or
recoupment or any other claim against the applicable Controlled Account other
than for payment of its service fees and other charges directly related to the
administration of such Controlled Account and for returned checks or other items
of payment, and (C) upon the instruction of Agent (an “Activation Instruction”),
the Controlled Account Bank will forward by daily sweep all amounts in the
applicable Controlled Account to the Agent’s Account. Agent agrees not to issue
an Activation Instruction with respect to the Controlled Accounts unless a
Dominion Triggering Event has occurred and is continuing at the time such
Activation Instruction is issued. Agent agrees to use commercially reasonable
efforts to rescind an Activation Instruction (the “Rescission”) if, after the
occurrence of such Dominion Triggering Event, thirty (30) consecutive days have
passed during which Excess Availability has exceeded US$15,000,000 and no Event
of Default has occurred and is continuing (and thirty (30) days have passed
since any Event of Default that gave rise to a Dominion Triggering Event has
been cured or waived in accordance with the Credit Agreement).

 

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  (ii) So long as no Default or Event of Default has occurred and is continuing,
Borrowers may amend Schedule 8 or 9 to add or replace a Controlled Account Bank
or Controlled Account and shall upon such addition or replacement provide to
Agent an amended Schedule 8 or 9; provided, however, except as provided in
Section 7(k)(iii), that (A) such prospective Controlled Account Bank shall be
reasonably satisfactory to Agent, and (B) prior to the time of the opening of
such Controlled Account, the applicable Grantor and such prospective Controlled
Account Bank shall have executed and delivered to Agent a Controlled Account
Agreement. Each Grantor shall close any of its Controlled Accounts (and
establish replacement Controlled Account accounts in accordance with the
foregoing sentence) as promptly as practicable and in any event within
forty-five (45) days after notice from Agent that the operating performance,
funds transfer, or availability procedures or performance of the Controlled
Account Bank with respect to Controlled Account Accounts or Agent’s liability
under any Controlled Account Agreement with such Controlled Account Bank is no
longer acceptable in Agent’s reasonable judgment.

 

  (iii) Other than (i) an aggregate amount of not more than US$500,000 for any
overnight balances, in the case of Grantors and their Domestic Subsidiaries, or
(ii) amounts deposited into Deposit Accounts specially and exclusively used for
(x) payroll, payroll taxes, deductions, premiums and other employee wage and
benefit payments to or for any Grantor’s or its Domestic Subsidiaries’
employees, or (y) disbursements other than the master disbursement account
identified on Schedule 8 (to the extent such other disbursement accounts are
linked to a master disbursement account (subject to a Control Agreement) as zero
balance accounts), no Grantor will, and no Grantor will permit its Subsidiaries
to, make, acquire, or permit to exist Permitted Investments consisting of cash,
Cash Equivalents, or amounts credited to Deposit Accounts or Securities Accounts
unless Grantor or its Domestic Subsidiary, as applicable, and the applicable
bank or securities intermediary have entered into Control Agreements with Agent
governing such Permitted Investments in order to perfect (and further establish)
Agent’s Liens in such Permitted Investments (or with respect to newly opened
Deposit Accounts or Securities Accounts opened for the sole purpose of effecting
a repurchase of Senior Unsecured Notes permitted under the Credit Agreement and
containing less than US$2,000,000 within ten (10) Business Days after opening
such account).

 

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(l) Name, Etc. Except as otherwise provided in Section 6.3 of the Credit
Agreement, no Grantor will change its legal name, chief executive office,
federal or provincial business number for tax purposes, organizational
identification number (if any), jurisdiction of organization or organizational
identity; provided, that a Grantor may change its legal name, chief executive
office, federal or provincial business number, organizational identification
number, jurisdiction of organization or organizational identity upon at least 10
days prior written notice to Agent of such change.

(m) Reserved.

(n) Pledged Notes. Grantors (i) without the prior written consent of Agent, with
respect to Pledged Notes with an original principal amount of US$1,000,000 in
the aggregate by any Person, will not (A) waive or release any material
obligation of any Person that is obligated under any of the Pledged Notes,
(B) take or omit to take any action or knowingly suffer or permit any action to
be omitted or taken, the taking or omission of which would result in any
material right of offset against sums payable under the Pledged Notes, or
(C) other than Permitted Dispositions, assign or surrender their rights and
interests under any of the Pledged Notes or terminate, cancel, modify, change,
supplement or amend the Pledged Notes, and (ii) shall provide to Agent copies of
all material written notices (including notices of default) given or received
with respect to the Pledged Notes promptly after giving or receiving such
notice.

8. Relation to Other Security Documents. The provisions of this Agreement shall
be read and construed with the other Loan Documents referred to below in the
manner so indicated.

(a) Credit Agreement. In the event of any conflict between any provision in this
Agreement and a provision in the Credit Agreement, such provision of the Credit
Agreement shall control.

(b) Patent, Trademark, Copyright Security Agreements. The provisions of the
Copyright Security Agreements, Trademark Security Agreements, and Patent
Security Agreements are supplemental to the provisions of this Agreement, and
nothing contained in the Copyright Security Agreements, Trademark Security
Agreements, or the Patent Security Agreements shall limit any of the rights or
remedies of Agent hereunder. In the event of any conflict between any provision
in this Agreement and a provision in a Copyright Security Agreement, Trademark
Security Agreement or Patent Security Agreement, such provision of this
Agreement shall control.

9. Further Assurances.

(a) Each Grantor agrees that from time to time, at its own expense, such Grantor
will promptly execute and deliver all further instruments and documents, and
take all further action, that Agent may reasonably request, in order to perfect
and protect the Security Interest granted hereby, to create, perfect or protect
the Security Interest purported to be granted hereby or to enable Agent to
exercise and enforce its rights and remedies hereunder with respect to any of
the Collateral.

 

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(b) Each Grantor authorizes the filing by Agent of financing or continuation
statements, or amendments thereto, and such Grantor will execute and deliver to
Agent such other instruments or notices, as Agent may reasonably request, in
order to perfect and preserve the Security Interest granted or purported to be
granted hereby.

(c) Each Grantor authorizes Agent at any time and from time to time to file,
transmit, or communicate, as applicable, financing statements and amendments
(i) describing the Collateral as “all personal property of debtor” or “all
assets of debtor” or words of similar effect, (ii) describing the Collateral as
being of equal or lesser scope or with greater detail, or (iii) that contain any
information required by the PPSA for the sufficiency or filing office
acceptance. Each Grantor also hereby ratifies any and all financing statements
or amendments previously filed by Agent in any jurisdiction.

(d) Each Grantor acknowledges that it is not authorized to file any financing
statement or amendment or termination statement with respect to any financing
statement filed in connection with this Agreement without the prior written
consent of Agent, subject to such Grantor’s rights under the PPSA.

10. Agent’s Right to Perform Contracts, Exercise Rights, etc. Upon the
occurrence and during the continuance of an Event of Default, Agent (or its
designee) (a) may proceed to perform any and all of the obligations of any
Grantor contained in any contract, lease, or other agreement and exercise any
and all rights of any Grantor therein contained as fully as such Grantor itself
could, (b) shall have the right to use any Grantor’s rights under Intellectual
Property Licenses in connection with the enforcement of Agent’s rights
hereunder, including the right to prepare for sale and sell any and all
Inventory and Equipment now or hereafter owned by any Grantor and now or
hereafter covered by such licenses, and (c) shall have the right to request that
any Equity Interests that are pledged hereunder be registered in the name of
Agent or any of its nominees.

11. Agent Appointed Attorney-in-Fact. Each Grantor hereby irrevocably appoints
each of Agent and Canadian Agent its attorney-in-fact, with full authority in
the place and stead of such Grantor and in the name of such Grantor or
otherwise, at such time as an Event of Default has occurred and is continuing
under the Credit Agreement, to take any action and to execute any instrument
which Agent may reasonably deem necessary or advisable to accomplish the
purposes of this Agreement, including:

(a) to ask, demand, collect, sue for, recover, compromise, receive and give
acquittance and receipts for moneys due and to become due under or in connection
with the Accounts or any other Collateral of such Grantor;

(b) to receive and open all mail addressed to such Grantor and to notify postal
authorities to change the address for the delivery of mail to such Grantor to
that of Agent;

(c) to receive, indorse, and collect any drafts or other instruments, documents,
Negotiable Collateral or Chattel Paper;

 

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(d) to file any claims or take any action or institute any proceedings which
Agent may deem necessary or desirable for the collection of any of the
Collateral of such Grantor or otherwise to enforce the rights of Agent with
respect to any of the Collateral;

(e) to repair, alter, or supply goods, if any, necessary to fulfill in whole or
in part the purchase order of any Person obligated to such Grantor in respect of
any Account of such Grantor;

(f) to use any Intellectual Property or Intellectual Property Licenses of such
Grantor, including but not limited to any labels, Patents, Trademarks, trade
names, URLs, domain names, industrial designs, Copyrights, or advertising
matter, in preparing for sale, advertising for sale, or selling Inventory or
other Collateral and to collect any amounts due under Accounts, contracts or
Negotiable Collateral of such Grantor; and

(g) Agent, on behalf of the Lender Group or the Canadian Bank Product Providers,
shall have the right, but shall not be obligated, to bring suit in its own name
to enforce the Intellectual Property and Intellectual Property Licenses and, if
Agent shall commence any such suit, the appropriate Grantor shall, at the
request of Agent, do any and all lawful acts and execute any and all proper
documents reasonably required by Agent in aid of such enforcement.

To the extent permitted by law, each Grantor hereby ratifies all that such
attorney-in-fact shall lawfully do or cause to be done by virtue hereof. This
power of attorney is coupled with an interest and shall be irrevocable until
this Agreement is terminated.

12. Agent May Perform. If any Grantor fails to perform any agreement contained
herein, Agent may itself perform, or cause performance of, such agreement, and
the reasonable expenses of Agent incurred in connection therewith shall be
payable, jointly and severally, by Grantors.

13. Agent’s Duties. The powers conferred on Agent hereunder are solely to
protect Agent’s interest in the Collateral, for the benefit of the Lender Group
and the Canadian Bank Product Providers, and shall not impose any duty upon
Agent to exercise any such powers. Except for the safe custody of any Collateral
in its actual possession and the accounting for moneys actually received by it
hereunder, Agent shall have no duty as to any Collateral or as to the taking of
any necessary steps to preserve rights against prior parties or any other rights
pertaining to any Collateral. Agent shall be deemed to have exercised reasonable
care in the custody and preservation of any Collateral in its actual possession
if such Collateral is accorded treatment substantially equal to that which Agent
accords its own property.

14. Collection of Accounts, General Intangibles and Negotiable Collateral. At
any time upon the occurrence and during the continuance of an Event of Default,
Agent or Agent’s designee may (a) notify Account Debtors of any Grantor that the
Accounts, General Intangibles, Chattel Paper or Negotiable Collateral of such
Grantor have been assigned to Agent, for the benefit of the Lender Group and the
Canadian Bank Product Providers, or that Agent has a security interest therein,
and (b) collect the Accounts, General Intangibles and Negotiable Collateral of
any Grantor directly, and any collection costs and expenses shall constitute
part of such Grantor’s Secured Obligations under the Loan Documents.

 

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15. Disposition of Pledged Interests by Agent. None of the Pledged Interests
existing as of the date of this Agreement are, and none of the Pledged Interests
hereafter acquired on the date of acquisition thereof will be, registered or
qualified under the various provincial securities laws of Canada and disposition
thereof after an Event of Default may be restricted to one or more private
(instead of public) sales in view of the lack of such registration or
qualification. Each Grantor understands that in connection with such
disposition, Agent may approach only a restricted number of potential purchasers
and further understands that a sale under such circumstances may yield a lower
price for the Pledged Interests than if the Pledged Interests were registered
and qualified pursuant to provincial securities laws and sold on the open
market. Each Grantor, therefore, agrees that: (a) if Agent shall, pursuant to
the terms of this Agreement, sell or cause the Pledged Interests or any portion
thereof to be sold at a private sale, Agent shall have the right to rely upon
the advice and opinion of any nationally recognized brokerage or investment firm
(but shall not be obligated to seek such advice and the failure to do so shall
not be considered in determining the commercial reasonableness of such action)
as to the best manner in which to offer the Pledged Interest or any portion
thereof for sale and as to the best price reasonably obtainable at the private
sale thereof; and (b) such reliance shall be conclusive evidence that Agent has
handled the disposition in a commercially reasonable manner.

16. Voting and Other Rights in Respect of Pledged Interests.

(a) Upon the occurrence and during the continuation of an Event of Default,
(i) Agent may, at its option, and with two (2) Business Days prior notice to any
Grantor, and in addition to all rights and remedies available to Agent under any
other agreement, at law, in equity, or otherwise, exercise all voting rights, or
any other ownership or consensual rights (including any dividend or distribution
rights) in respect of the Pledged Interests owned by such Grantor, but under no
circumstances is Agent obligated by the terms of this Agreement to exercise such
rights, and (ii) if Agent duly exercises its right to vote any of such Pledged
Interests, each Grantor hereby appoints Agent, such Grantor’s true and lawful
attorney-in-fact and IRREVOCABLE PROXY to vote such Pledged Interests in any
manner Agent deems advisable for or against all matters submitted or which may
be submitted to a vote of shareholders, partners or members, as the case may be.
The power-of-attorney and proxy granted hereby is coupled with an interest and
shall be irrevocable.

(b) For so long as any Grantor shall have the right to vote the Pledged
Interests owned by it, such Grantor covenants and agrees that it will not,
without the prior written consent of Agent, vote or take any consensual action
with respect to such Pledged Interests which would materially adversely affect
the rights of Agent, the other members of the Lender Group, or the Canadian Bank
Product Providers, or the value of the Pledged Interests.

17. Remedies. Upon the occurrence and during the continuance of an Event of
Default:

(a) Agent may, and, at the instruction of the Required Lenders, shall exercise
in respect of the Collateral, in addition to other rights and remedies provided
for herein, in the other Loan Documents, or otherwise available to it, all the
rights and remedies of a secured party on default under the PPSA or any other
applicable law. Without limiting the generality of the

 

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foregoing, each Grantor expressly agrees that, in any such event, Agent without
demand of performance or other demand, advertisement or notice of any kind
(except a notice specified below of time and place of public or private sale) to
or upon any Grantor or any other Person (all and each of which demands,
advertisements and notices are hereby expressly waived to the maximum extent
permitted by the PPSA or any other applicable law), may take immediate
possession of all or any portion of the Collateral and (i) require Grantors to,
and each Grantor hereby agrees that it will at its own expense and upon request
of Agent forthwith, assemble all or part of the Collateral as directed by Agent
and make it available to Agent at one or more locations where such Grantor
regularly maintains Inventory, and (ii) without notice except as specified
below, sell the Collateral or any part thereof in one or more parcels at public
or private sale, at any of Agent’s offices or elsewhere, for cash, on credit,
and upon such other terms as Agent may deem commercially reasonable. Each
Grantor agrees that, to the extent notification of sale shall be required by
law, at least ten (10) days notification by mail to the applicable Grantor of
the time and place of any public sale or the time after which any private sale
is to be made shall constitute reasonable notification. Agent shall not be
obligated to make any sale of Collateral regardless of notification of sale
having been given. Agent may adjourn any public sale from time to time by
announcement at the time and place fixed therefor, and such sale may, without
further notice, be made at the time and place to which it was so adjourned. Each
Grantor agrees that (A) the internet shall constitute a “place” for purposes of
the PPSA and (B) to the extent notification of sale shall be required by law,
notification by mail of the URL where a sale will occur and the time when a sale
will commence at least ten (10) days prior to the sale shall constitute a
reasonable notification for purposes of the PPSA. Each Grantor agrees that any
sale of Collateral to a licensor pursuant to the terms of a license agreement
between such licensor and a Grantor is sufficient to constitute a commercially
reasonable sale (including as to method, terms, manner, and time) within the
meaning of the PPSA.

(b) Agent is hereby granted a license or other right to use, without liability
for royalties or any other charge, each Grantor’s Intellectual Property,
including but not limited to, any labels, Patents, Trademarks, trade names,
URLs, domain names, industrial designs, Copyrights, and advertising matter,
whether owned by any Grantor or with respect to which any Grantor has rights
under license, sublicense, or other agreements (including any Intellectual
Property License), as it pertains to the Collateral, in preparing for sale,
advertising for sale and selling any Collateral, and each Grantor’s rights under
all licenses and all franchise agreements shall inure to the benefit of Agent.

(c) Agent may, in addition to other rights and remedies provided for herein, in
the other Loan Documents, or otherwise available to it under applicable law and
without the requirement of notice to or upon any Grantor or any other Person
(which notice is hereby expressly waived to the maximum extent permitted by the
PPSA or any other applicable law), (i) with respect to any Grantor’s Deposit
Accounts in which Agent’s Liens are perfected under the PPSA, instruct the bank
maintaining such Deposit Account for the applicable Grantor to pay the balance
of such Deposit Account to or for the benefit of Agent, and (ii) with respect to
any Grantor’s Securities Accounts in which Agent’s Liens are perfected by
control under the PPSA, instruct the securities intermediary maintaining such
Securities Account for the applicable Grantor to (A) transfer any cash in such
Securities Account to or for the benefit of Agent, or (B) liquidate any
financial assets in such Securities Account that are customarily sold on a
recognized market and transfer the cash proceeds thereof to or for the benefit
of Agent.

 

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(d) Any cash held by Agent as Collateral and all cash proceeds received by Agent
in respect of any sale of, collection from, or other realization upon all or any
part of the Collateral shall be applied against the Secured Obligations in the
order set forth in the Credit Agreement. In the event the proceeds of Collateral
are insufficient to satisfy all of the Secured Obligations in full, each Grantor
shall remain jointly and severally liable for any such deficiency.

(e) Each Grantor hereby acknowledges that the Secured Obligations arise out of a
commercial transaction, and agrees that if an Event of Default shall occur and
be continuing Agent shall have the right to an immediate writ of possession
without notice of a hearing. Agent shall have the right to the appointment of a
receiver for the properties and assets of each Grantor, and each Grantor hereby
consents to such rights and such appointment and hereby waives any objection
such Grantor may have thereto or the right to have a bond or other security
posted by Agent.

18. Remedies Cumulative. Each right, power, and remedy of Agent, any other
member of the Lender Group, or any Canadian Bank Product Provider as provided
for in this Agreement, the other Loan Documents or any Canadian Bank Product
Agreement now or hereafter existing at law or in equity or by statute or
otherwise shall be cumulative and concurrent and shall be in addition to every
other right, power, or remedy provided for in this Agreement, the other Loan
Documents and the Canadian Bank Product Agreements or now or hereafter existing
at law or in equity or by statute or otherwise, and the exercise or beginning of
the exercise by Agent, any other member of the Lender Group, or any Canadian
Bank Product Provider, of any one or more of such rights, powers, or remedies
shall not preclude the simultaneous or later exercise by Agent, such other
member of the Lender Group or such Canadian Bank Product Provider of any or all
such other rights, powers, or remedies.

19. Marshaling. Agent shall not be required to marshal any present or future
collateral security (including but not limited to the Collateral) for, or other
assurances of payment of, the Secured Obligations or any of them or to resort to
such collateral security or other assurances of payment in any particular order,
and all of its rights and remedies hereunder and in respect of such collateral
security and other assurances of payment shall be cumulative and in addition to
all other rights and remedies, however existing or arising. To the extent that
it lawfully may, each Grantor hereby agrees that it will not invoke any law
relating to the marshaling of collateral which might cause delay in or impede
the enforcement of Agent’s rights and remedies under this Agreement or under any
other instrument creating or evidencing any of the Secured Obligations or under
which any of the Secured Obligations is outstanding or by which any of the
Secured Obligations is secured or payment thereof is otherwise assured, and, to
the extent that it lawfully may, each Grantor hereby irrevocably waives the
benefits of all such laws.

20. Indemnity and Expenses.

(a) Each Grantor agrees to indemnify Agent and the other members of the Lender
Group from and against all claims, lawsuits and liabilities (including
reasonable attorneys’ fees) arising out of or resulting from this Agreement
(including enforcement of this Agreement) or any other Loan Document to which
such Grantor is a party, except claims, losses or liabilities resulting from the
gross negligence or willful misconduct of the party seeking

 

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indemnification as determined by a final non-appealable order of a court of
competent jurisdiction. This provision shall survive the termination of this
Agreement and the Credit Agreement and the repayment of the Secured Obligations.

(b) Grantors, jointly and severally, shall, upon demand, pay to Agent (or Agent,
may charge to the Loan Account) all the Lender Group Expenses which Agent may
incur in connection with (i) the administration of this Agreement, (ii) the
custody, preservation, use or operation of, or, upon an Event of Default, the
sale of, collection from, or other realization upon, any of the Collateral in
accordance with this Agreement and the other Loan Documents to which the
Grantors are a party, (iii) the exercise or enforcement of any of the rights of
Agent hereunder or (iv) the failure by any Grantor to perform or observe any of
the provisions hereof.

21. Merger, Amendments; Etc. THIS AGREEMENT, TOGETHER WITH THE OTHER LOAN
DOCUMENTS TO WHICH THE GRANTORS ARE PARTIES, REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN
AGREEMENTS BETWEEN THE PARTIES. No waiver of any provision of this Agreement,
and no consent to any departure by any Grantor herefrom, shall in any event be
effective unless the same shall be in writing and signed by Agent, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given. No amendment of any provision of this
Agreement shall be effective unless the same shall be in writing and signed by
Agent and each Grantor to which such amendment applies.

22. Addresses for Notices. All notices and other communications provided for
hereunder shall be given in the form and manner and delivered to Agent at its
address specified in the Credit Agreement, and to any of the Grantors at their
respective addresses specified in the Credit Agreement or Guaranty, as
applicable, or, as to any party, at such other address as shall be designated by
such party in a written notice to the other party.

23. Continuing Security Interest: Assignments under Credit Agreement.

(a) This Agreement shall create a continuing security interest in the Collateral
and shall (i) remain in full force and effect until the Secured Obligations have
been paid in full in accordance with the provisions of the Credit Agreement and
the Revolver Commitments have expired or have been terminated, (ii) be binding
upon each Grantor, and their respective successors and assigns, and (iii) inure
to the benefit of, and be enforceable by, Agent, and its successors, transferees
and assigns. Without limiting the generality of the foregoing clause (iii), any
Lender may, in accordance with the provisions of the Credit Agreement, assign or
otherwise transfer all or any portion of its rights and obligations under the
Credit Agreement to any other Person, and such other Person shall thereupon
become vested with all the benefits in respect thereof granted to such Lender
herein or otherwise. Upon payment in full of the Secured Obligations in
accordance with the provisions of the Credit Agreement and the expiration or
termination of the Commitments, the Guaranty made and the Security Interest
granted hereby shall terminate and all rights to the Collateral shall revert to
Grantors or any other Person entitled thereto. At such time, upon Borrowers’
request, Agent will authorize the filing of appropriate termination statements
to terminate such Security Interest. Upon (i) the consummation of any

 

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sale, transfer or other disposition of Collateral to any Person other than a
Grantor pursuant to a transaction permitted by the Credit Agreement and for
aggregate consideration not to exceed US$500,000, and (ii) delivery by such
Grantor of a certificate to Agent certifying that such sale, transfer or other
disposition is permitted by the Credit Agreement and for consideration not in
excess of US$500,000, the Security Interest granted hereby with respect to such
Collateral shall terminate (but shall attach to the proceeds or products
thereof) and Agent shall provide evidence of such termination, and with respect
to any such sales permitted by the Credit Agreement for consideration exceeding
US$500,000, Agent shall provide its termination upon confirmation that such sale
is permitted by the Credit Agreement. No transfer or renewal, extension,
assignment, or termination of this Agreement or of the Credit Agreement, any
other Loan Document, or any other instrument or document executed and delivered
by any Grantor to Agent nor any additional Advances or other loans made by any
Lender to any Borrower, nor the taking of further security, nor the retaking or
re-delivery of the Collateral to Grantors, or any of them, by Agent, nor any
other act of the Lender Group or the Canadian Bank Product Providers, or any of
them, shall release any Grantor from any obligation, except a release or
discharge executed in writing by Agent in accordance with the provisions of the
Credit Agreement. Agent shall not by any act, delay, omission or otherwise, be
deemed to have waived any of its rights or remedies hereunder, unless such
waiver is in writing and signed by Agent and then only to the extent therein set
forth. A waiver by Agent of any right or remedy on any occasion shall not be
construed as a bar to the exercise of any such right or remedy which Agent would
otherwise have had on any other occasion.

(b) Each Grantor agrees that, if any payment made by any Grantor or other Person
and applied to the Secured Obligations is at any time annulled, avoided, set,
aside, rescinded, invalidated, declared to be fraudulent or preferential or
otherwise required to be refunded or repaid, or the proceeds of any Collateral
are required to be returned by Agent or any other member of the Lender Group to
such Grantor, its estate, trustee, receiver or any other party, including any
Grantor, under any bankruptcy or insolvency law, provincial, state or federal
law, common law or equitable cause, then, to the extent of such payment or
repayment, any Lien or other Collateral securing such liability shall be and
remain in full force and effect, as fully as if such payment had never been
made. If, prior to any of the foregoing, (i) any Lien or other Collateral
securing such Grantor’s liability hereunder shall have been released or
terminated by virtue of the foregoing clause (a), or (ii) any provision of the
Guaranty hereunder shall have been terminated, cancelled or surrendered, such
Lien, other Collateral or provision shall be reinstated in full force and effect
and such prior release, termination, cancellation or surrender shall not
diminish, release, discharge, impair or otherwise affect the obligations of any
such Grantor in respect of any Lien or other Collateral securing such obligation
or the amount of such payment.

24. Survival. All representations and warranties made by the Grantors in this
Agreement and in the certificates or other instruments delivered in connection
with or pursuant to this Agreement shall be considered to have been relied upon
by the other parties hereto and shall survive the execution and delivery of this
Agreement and the making of any loans and issuance of any Letters of Credit,
regardless of any investigation made by any such other party or on its behalf
and notwithstanding that Agent, Issuing Lender, or any Lender may have had
notice or knowledge of any Default or Event of Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any loan or any fee or any other amount payable under the
Credit Agreement is outstanding and unpaid or any Letter of Credit is
outstanding and so long as the Commitments have not expired or terminated.

 

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25. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER; JUDICIAL REFERENCE PROVISION.

(a) THE VALIDITY OF THIS AGREEMENT, THE CONSTRUCTION, INTERPRETATION, AND
ENFORCEMENT HEREOF, THE RIGHTS OF THE PARTIES HERETO WITH RESPECT TO ALL MATTERS
ARISING HEREUNDER OR RELATED HERETO, AND ANY CLAIMS, CONTROVERSIES OR DISPUTES
ARISING HEREUNDER OR RELATED HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE PROVINCE OF ONTARIO.

(b) THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH
THIS AGREEMENT SHALL BE TRIED AND LITIGATED ONLY IN A COURT OF COMPETENT
JURISDICTION OF THE PROVINCE OF ONTARIO; PROVIDED, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT AGENT’S
OPTION, IN THE COURTS OF ANY JURISDICTION WHERE AGENT ELECTS TO BRING SUCH
ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH GRANTOR AND
AGENT WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY
HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE
EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 25(b).

(c) TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, EACH GRANTOR AND AGENT
HEREBY WAIVE THEIR RESPECTIVE RIGHTS, IF ANY, TO A JURY TRIAL OF ANY CLAIM,
CONTROVERSY, DISPUTE OR CAUSE OF ACTION DIRECTLY OR INDIRECTLY BASED UPON OR
ARISING OUT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN,
INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER
COMMON LAW OR STATUTORY CLAIMS (EACH A “CLAIM”). EACH GRANTOR AND AGENT
REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND VOLUNTARILY
WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. IN THE
EVENT OF LITIGATION, A COPY OF THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT
TO A TRIAL BY THE COURT.

(d) EACH GRANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO A COURT OF
COMPETENT JURISDICTION OF THE PROVINCE OF ONTARIO, IN ANY ACTION OR PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT
OF ANY JUDGMENT. EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY
SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
NOTHING IN THIS AGREEMENT SHALL AFFECT ANY RIGHT THAT AGENT MAY OTHERWISE HAVE
TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AGAINST ANY GRANTOR
OR ITS PROPERTIES IN THE COURTS OF ANY JURISDICTION.

 

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(e) NO CLAIM MAY BE MADE BY ANY GRANTOR AGAINST THE AGENT, THE SWING LENDER, ANY
OTHER LENDER, ISSUING LENDER, OR THE UNDERLYING ISSUER, OR ANY AFFILIATE,
DIRECTOR, OFFICER, EMPLOYEE, COUNSEL, REPRESENTATIVE, AGENT, OR ATTORNEY-IN-FACT
OF ANY OF THEM FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL, OR PUNITIVE DAMAGES IN
RESPECT OF ANY CLAIM FOR BREACH OF CONTRACT OR ANY OTHER THEORY OF LIABILITY
ARISING OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT, OR
ANY ACT, OMISSION, OR EVENT OCCURRING IN CONNECTION HEREWITH, AND EACH GRANTOR
HEREBY WAIVES, RELEASES, AND AGREES NOT TO SUE UPON ANY CLAIM FOR SUCH DAMAGES,
WHETHER OR NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO EXIST IN ITS
FAVOR.

26. New Subsidiaries. Pursuant to Section 5.11 of the Credit Agreement, certain
Subsidiaries (whether by acquisition or creation) of any Grantor are required to
enter into this Agreement by executing and delivering in favor of Agent a
Joinder to this Agreement in substantially the form of Annex 1. Upon the
execution and delivery of Annex 1 by any such new Subsidiary, such Subsidiary
shall become a Guarantor and Grantor hereunder with the same force and effect as
if originally named as a Guarantor and Grantor herein. The execution and
delivery of any instrument adding an additional Guarantor or Grantor as a party
to this Agreement shall not require the consent of any Guarantor or Grantor
hereunder. The rights and obligations of each Guarantor and Grantor hereunder
shall remain in full force and effect notwithstanding the addition of any new
Guarantor or Grantor hereunder.

27. Agent. Each reference herein to any right granted to, benefit conferred upon
or power exercisable by the “Agent” shall be a reference to Agent, for the
benefit of each member of the Lender Group and each of the Canadian Bank Product
Providers and as collateral agent for the Canadian Agent with respect to its
interests in the Collateral to secure the Canadian Obligations.

28. Miscellaneous.

(a) This Agreement is a Loan Document. This Agreement may be executed in any
number of counterparts and by different parties on separate counterparts, each
of which, when executed and delivered, shall be deemed to be an original, and
all of which, when taken together, shall constitute but one and the same
Agreement. Delivery of an executed counterpart of this Agreement by
telefacsimile or other electronic method of transmission shall be equally as
effective as delivery of an original executed counterpart of this Agreement. Any
party delivering an executed counterpart of this Agreement by telefacsimile or
other electronic method of transmission also shall deliver an original executed
counterpart of this Agreement but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Agreement. The foregoing shall apply to each other Loan Document mutatis
mutandis.

 

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(b) Any provision of this Agreement which is prohibited or unenforceable shall
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof in that jurisdiction or affecting
the validity or enforceability of such provision in any other jurisdiction. Each
provision of this Agreement shall be severable from every other provision of
this Agreement for the purpose of determining the legal enforceability of any
specific provision.

(c) Headings and numbers have been set forth herein for convenience only. Unless
the contrary is compelled by the context, everything contained in each Section
applies equally to this entire Agreement.

(d) Neither this Agreement nor any uncertainty or ambiguity herein shall be
construed against any member of the Lender Group or any Grantor, whether under
any rule of construction or otherwise. This Agreement has been reviewed by all
parties and shall be construed and interpreted according to the ordinary meaning
of the words used so as to accomplish fairly the purposes and intentions of all
parties hereto.

[signature pages follow]

 

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IN WITNESS WHEREOF, the undersigned parties hereto have caused this Agreement to
be executed and delivered as of the day and year first above written.

 

GRANTORS:     ARC REPROGRAPHICS CANADA CORP.     BY:  

/s/ Jorge Avalos

    NAME:  

Jorge Avalos

    TITLE:  

Chairman

    ARC DIGITAL CANADA CORP.     BY:  

/s/ Jorge Avalos

    NAME:  

Jorge Avalos

    TITLE:  

President

Signature Page to Canadian Security Agreement

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AGENT:     WELLS FARGO BANK, NATIONAL ASSOCIATION     BY:  

/s/ Grant Pritchard

    NAME:  

Grant Pritchard

    TITLE:  

Vice President

Signature Page to Canadian Security Agreement

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ANNEX 1 TO CANADIAN GUARANTY AND SECURITY AGREEMENT

FORM OF JOINDER

Joinder No.      (this “Joinder”), dated as of              20    , to the
Canadian Guaranty and Security Agreement, dated as of January     , 2012 (as
amended, restated, supplemented, or otherwise modified from time to time, the
“Guaranty and Security Agreement”), by and among each of the parties listed on
the signature pages thereto and those additional entities that thereafter become
parties thereto (collectively, jointly and severally, “Grantors” and each,
individually, a “Grantor”) and WELLS FARGO BANK, NATIONAL ASSOCIATION, in its
capacity as agent for the Lender Group and the Bank Product Providers (in such
capacity, together with its successors and assigns in such capacity, “Agent”).

W I T N E S S E T H:

WHEREAS, pursuant to that certain Credit Agreement dated as of January     ,
2012 (as amended, restated, supplemented, or otherwise modified from time to
time, the “Credit Agreement”) by and among American Reprographics Company, a
Delaware corporation (“US Borrower”), ARC Reprographics Canada Corp., a British
Columbia corporation (“ARC Canada”) and ARC Digital Canada Corp., a British
Columbia corporation (“ARC Digital Canada”; and ARC Digital Canada together with
ARC Canada, “Canadian Borrowers”), US Borrower and Canadian Borrowers are
collectively referred to as “Borrowers”), the lenders party thereto as “Lenders”
(each of such Lenders, together with its successors and permitted assigns, is
referred to hereinafter as a “Lender”), Agent, and Wells Fargo Capital Finance
Corporation Canada, an Ontario corporation as administrative agent for the
Canadian Lenders (in such capacity, together with its successors and assigns in
such capacity, “Canadian Agent”), the Lender Group has agreed to make certain
financial accommodations available to Borrowers from time to time pursuant to
the terms and conditions thereof; and

WHEREAS, initially capitalized terms used herein and not otherwise defined
herein shall have the meanings assigned to such terms in the Guaranty and
Security Agreement or, if not defined therein, in the Credit Agreement, and this
Joinder shall be subject to the rules of construction set forth in Section 1(b)
of the Guaranty and Security Agreement, which rules of construction are
incorporated herein by this reference, mutatis mutandis; and

WHEREAS, Grantors have entered into the Guaranty and Security Agreement in order
to induce the Lender Group and the Canadian Bank Product Providers to make
certain financial accommodations to Canadian Borrowers as provided for in the
Credit Agreement, the other Loan Documents, and the Canadian Bank Product
Agreements; and

WHEREAS, pursuant to Section 5.11 of the Credit Agreement and Section 26 of the
Guaranty and Security Agreement, certain Subsidiaries of the Loan Parties, must
execute and deliver certain Loan Documents, including the Guaranty and Security
Agreement, and the joinder to the Guaranty and Security Agreement by the
undersigned new Grantor or Grantors (collectively, the “New Grantors”) may be
accomplished by the execution of this Joinder in favor of Agent, for the benefit
of the Lender Group and the Canadian Bank Product Providers; and

 

Annex I - 1

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WHEREAS, each New Grantor (a) is [an Affiliate] [a Subsidiary] of a Canadian
Borrower and, as such, will benefit by virtue of the financial accommodations
extended to such Canadian Borrower by the Lender Group or the Canadian Bank
Product Providers and (b) by becoming a Grantor will benefit from certain rights
granted to the Grantors pursuant to the terms of the Loan Documents and the
Canadian Bank Product Agreements;

NOW, THEREFORE, for and in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, each New Grantor hereby agrees as follows:

1. In accordance with Section 26 of the Guaranty and Security Agreement, each
New Grantor, by its signature below, becomes a “Grantor” and “Guarantor” under
the Guaranty and Security Agreement with the same force and effect as if
originally named therein as a “Grantor” and “Guarantor” and each New Grantor
hereby (a) agrees to all of the terms and provisions of the Guaranty and
Security Agreement applicable to it as a “Grantor” or “Guarantor” thereunder and
(b) represents and warrants that the representations and warranties made by it
as a “Grantor” or “Guarantor” thereunder are true and correct in all material
respects (except that such materiality qualifier shall not be applicable to any
representations and warranties that are already qualified or modified by
materiality in the text thereof) on and as of the date hereof. In furtherance of
the foregoing, each New Grantor hereby (a) jointly and severally unconditionally
and irrevocably guarantees as a primary obligor and not merely as a surety the
full and prompt payment when due, whether upon maturity, acceleration, or
otherwise, of all of the Guarantied Obligations, and (b) unconditionally grants,
assigns, and pledges to Agent, for the benefit of the Lender Group and the
Canadian Bank Product Providers, to secure the Secured Obligations, a continuing
security interest in and to all of such New Grantor’s right, title and interest
in and to the Collateral. Each reference to a “Grantor” or “Guarantor” in the
Guaranty and Security Agreement shall be deemed to include each New Grantor. The
Guaranty and Security Agreement is incorporated herein by reference.

2. Schedule 1, “Copyrights”, Schedule 2, “Intellectual Property Licenses”,
Schedule 3, “Patents”, Schedule 4, “Pledged Companies”, Schedule 5,
“Trademarks”, Schedule 6, Name; Chief Executive Office; Business Numbers and
Organizational Numbers, Schedule 7, “Owned Real Property”, Schedule 8, “Deposit
Accounts and Securities Accounts”, Schedule 9, “Controlled Account Banks”, and
Schedule 10, “List of Personal Property Security Act Filing Jurisdictions”,
attached hereto supplement Schedule 1, Schedule 2, Schedule 3, Schedule 4,
Schedule 5, Schedule 6, Schedule 7, Schedule 8, Schedule 9 and Schedule 10,
respectively, to the Guaranty and Security Agreement and shall be deemed a part
thereof for all purposes of the Guaranty and Security Agreement.

3. Each New Grantor authorizes Agent at any time and from time to time to file,
transmit, or communicate, as applicable, financing statements and amendments
thereto (i) describing the Collateral as “all personal property of debtor” or
“all assets of debtor” or words of similar effect, (ii) describing the
Collateral as being of equal or lesser scope or with greater detail, or
(iii) that contain any information required by the PPSA for the sufficiency or
filing office acceptance. Each New Grantor also hereby ratifies any and all
financing statements or amendments previously filed by Agent in any jurisdiction
in connection with the Loan Documents.

 

Annex I - 2

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4. Each New Grantor represents and warrants to Agent, the Lender Group and the
Canadian Bank Product Providers that this Joinder has been duly executed and
delivered by such New Grantor and constitutes its legal, valid, and binding
obligation, enforceable against it in accordance with its terms, except as
enforceability thereof may be limited by bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium, or other similar laws affecting creditors’
rights generally and general principles of equity (regardless of whether such
enforceability is considered in a proceeding at law or in equity).

5. This Joinder is a Loan Document. This Joinder may be executed in any number
of counterparts and by different parties on separate counterparts, each of
which, when executed and delivered, shall be deemed to be an original, and all
of which, when taken together, shall constitute but one and the same Joinder.
Delivery of an executed counterpart of this Joinder by telefacsimile or other
electronic method of transmission shall be equally as effective as delivery of
an original executed counterpart of this Joinder. Any party delivering an
executed counterpart of this Joinder by telefacsimile or other electronic method
of transmission also shall deliver an original executed counterpart of this
Joinder but the failure to deliver an original executed counterpart shall not
affect the validity, enforceability, and binding effect of this Joinder.

6. The Guaranty and Security Agreement, as supplemented hereby, shall remain in
full force and effect.

7. THIS JOINDER SHALL BE SUBJECT TO THE PROVISIONS REGARDING CHOICE OF LAW AND
VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE SET FORTH IN SECTION 25 OF THE
GUARANTY AND SECURITY AGREEMENT, AND SUCH PROVISIONS ARE INCORPORATED HEREIN BY
THIS REFERENCE, MUTATIS MUTANDIS.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

 

Annex I - 3

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IN WITNESS WHEREOF, the parties hereto have caused this Joinder to the Guaranty
and Security Agreement to be executed and delivered as of the day and year first
above written.

 

NEW GRANTORS:     [NAME OF NEW GRANTOR]     By:  

 

    Name:  

 

    Title:       [NAME OF NEW GRANTOR]     By:  

 

    Name:  

 

    Title:   AGENT:     WELLS FARGO BANK, NATIONAL ASSOCIATION     By:  

 

    Name:  

 

    Title:  

[SIGNATURE PAGE TO JOINDER NO.      TO SECURITY AGREEMENT]

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EXHIBIT A

COPYRIGHT SECURITY AGREEMENT

This COPYRIGHT SECURITY AGREEMENT (this “Copyright Security Agreement”) is made
this      day of             , 20    , by and among Grantors listed on the
signature pages hereof (collectively, jointly and severally, “Grantors” and each
individually “Grantor”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, in its
capacity as agent for the Lender Group and the Canadian Bank Product Providers
(in such capacity, together with its successors and assigns in such capacity,
“Agent”).

W I T N E S S E T H:

WHEREAS, pursuant to that certain Credit Agreement dated as of January     ,
2012 (as amended, restated, supplemented, or otherwise modified from time to
time, the “Credit Agreement”) by and among American Reprographics Company, a
Delaware corporation (“US Borrower”), ARC Reprographics Canada Corp., a British
Columbia corporation (“ARC Canada”) and ARC Digital Canada Corp., a British
Columbia corporation (“ARC Digital Canada”; and ARC Digital Canada together with
ARC Canada, “Canadian Borrowers”), US Borrower and Canadian Borrowers are
collectively referred to as “Borrowers”), the lenders party thereto as
“Lenders”, Agent, and Wells Fargo Capital Finance Corporation Canada, an Ontario
corporation, as administrative agent for the Canadian Lenders, the Lender Group
has agreed to make certain financial accommodations available to Borrowers from
time to time pursuant to the terms and conditions thereof; and

WHEREAS, the members of the Lender Group and the Canadian Bank Product Providers
are willing to make the financial accommodations to Borrowers as provided for in
the Credit Agreement, the other Loan Documents, and the Canadian Bank Product
Agreements, but only upon the condition, among others, that Grantors shall have
executed and delivered to Agent, for the benefit of the Canadian Lenders and the
Canadian Bank Product Providers, that certain Canadian Guaranty and Security
Agreement, dated as of January     , 2012 (including all annexes, exhibits or
schedules thereto, as from time to time amended, restated, supplemented or
otherwise modified, the “Guaranty and Security Agreement”); and

WHEREAS, pursuant to the Guaranty and Security Agreement, Grantors are required
to execute and deliver to Agent, for the benefit of the Canadian Lenders and the
Canadian Bank Product Providers, this Copyright Security Agreement;

NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Grantors hereby agree as follows:

1. DEFINED TERMS. All initially capitalized terms used but not otherwise defined
herein have the meanings given to them in the Guaranty and Security Agreement
or, if not defined therein, in the Credit Agreement, and this Copyright Security
Agreement shall be subject to the rules of construction set forth in
Section 1(b) of the Guaranty and Security Agreement, which rules of construction
are incorporated herein by this reference, mutatis mutandis.

 

A-1

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2. GRANT OF SECURITY INTEREST IN COPYRIGHT COLLATERAL. Each Grantor hereby
unconditionally grants, assigns, and pledges to Agent, for the benefit each
member of the Lender Group and each of the Canadian Bank Product Providers, to
secure the Secured Obligations, a continuing security interest (referred to in
this Copyright Security Agreement as the “Security Interest”) in all of such
Grantor’s right, title and interest in and to the following, whether now owned
or hereafter acquired or arising (collectively, the “Copyright Collateral”):

(a) all of such Grantor’s Copyrights and Copyright Intellectual Property
Licenses to which it is a party including those referred to on Schedule I;

(b) all renewals or extensions of the foregoing; and

(c) all products and proceeds of the foregoing, including any claim by such
Grantor against third parties for past, present or future infringement of any
Copyright or any Copyright exclusively licensed under any Intellectual Property
License, including the right to receive damages, or the right to receive license
fees, royalties, and other compensation under any Copyright Intellectual
Property License.

3. SECURITY FOR SECURED OBLIGATIONS. This Copyright Security Agreement and the
Security Interest created hereby secures the payment and performance of the
Secured Obligations, whether now existing or arising hereafter. Without limiting
the generality of the foregoing, this Copyright Security Agreement secures the
payment of all amounts which constitute part of the Secured Obligations and
would be owed by Grantors, or any of them, to Agent, the other members of the
Lender Group, the Canadian Bank Product Providers or any of them, whether or not
they are unenforceable or not allowable due to the existence of an Insolvency
Proceeding involving any Grantor.

4. SECURITY AGREEMENT. The Security Interest granted pursuant to this Copyright
Security Agreement is granted in conjunction with the security interests granted
to Agent, for the benefit of the Lender Group and the Canadian Bank Product
Providers, pursuant to the Guaranty and Security Agreement. Each Grantor hereby
acknowledges and affirms that the rights and remedies of Agent with respect to
the Security Interest in the Copyright Collateral made and granted hereby are
more fully set forth in the Guaranty and Security Agreement, the terms and
provisions of which are incorporated by reference herein as if fully set forth
herein. To the extent there is any inconsistency between this Copyright Security
Agreement and the Guaranty and Security Agreement, the Guaranty and Security
Agreement shall control.

5. AUTHORIZATION TO SUPPLEMENT. Grantors shall give Agent prior written notice
of no less than five (5) Business Days before filing any additional application
for registration of any copyright and prompt notice in writing of any additional
copyright registrations granted therefor after the date hereof. Without limiting
Grantors’ obligations under this Section, Grantors hereby authorize Agent
unilaterally to modify this Copyright Security Agreement by amending Schedule I
to include any future Canadian registered copyrights or

 

A-2

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applications therefor of each Grantor. Notwithstanding the foregoing, no failure
to so modify this Copyright Security Agreement or amend Schedule I shall in any
way affect, invalidate or detract from Agent’s continuing security interest in
all Copyright Collateral, whether or not listed on Schedule I.

6. COUNTERPARTS. This Copyright Security Agreement is a Loan Document. This
Copyright Security Agreement may be executed in any number of counterparts and
by different parties on separate counterparts, each of which, when executed and
delivered, shall be deemed to be an original, and all of which, when taken
together, shall constitute but one and the same Copyright Security Agreement.
Delivery of an executed counterpart of this Copyright Security Agreement by
telefacsimile or other electronic method of transmission shall be equally as
effective as delivery of an original executed counterpart of this Copyright
Security Agreement. Any party delivering an executed counterpart of this
Copyright Security Agreement by telefacsimile or other electronic method of
transmission also shall deliver an original executed counterpart of this
Copyright Security Agreement but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Copyright Security Agreement.

7. CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE PROVISION.
THIS COPYRIGHT SECURITY AGREEMENT SHALL BE SUBJECT TO THE PROVISIONS REGARDING
CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE SET FORTH IN
SECTION 25 OF THE GUARANTY AND SECURITY AGREEMENT, AND SUCH PROVISIONS ARE
INCORPORATED HEREIN BY THIS REFERENCE, MUTATIS MUTANDIS.

[signature page follows]

 

A-3

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IN WITNESS WHEREOF, the parties hereto have caused this Copyright Security
Agreement to be executed and delivered as of the day and year first above
written.

 

GRANTORS:    

 

    By:  

 

    Name:  

 

    Title:      

 

    By:  

 

    Name:  

 

    Title:       ACCEPTED AND ACKNOWLEDGED BY: AGENT:     WELLS FARGO BANK,
NATIONAL ASSOCIATION     By:  

 

    Name:  

 

    Title:  

[SIGNATURE PAGE TO COPYRIGHT SECURITY AGREEMENT]

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

SCHEDULE I

to

COPYRIGHT SECURITY AGREEMENT

Copyright Registrations

 

Grantor

 

Country

 

Copyright

  

Registration No.

  

Registration Date

                                                                               

Copyright Licenses

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EXHIBIT B

PATENT SECURITY AGREEMENT

This PATENT SECURITY AGREEMENT (this “Patent Security Agreement”) is made this
     day of             , 20    , by and among the Grantors listed on the
signature pages hereof (collectively, jointly and severally, “Grantors” and each
individually “Grantor”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, in its
capacity as agent for the Lender Group and the Canadian Bank Product Providers
(in such capacity, together with its successors and assigns in such capacity,
“Agent”).

W I T N E S S E T H:

WHEREAS, pursuant to that certain Credit Agreement dated as of January     ,
2012 (as amended, restated, supplemented, or otherwise modified from time to
time, the “Credit Agreement”) by and among American Reprographics Company, a
Delaware corporation (“US Borrower”), ARC Reprographics Canada Corp., a British
Columbia corporation (“ARC Canada”) and ARC Digital Canada Corp., a British
Columbia corporation (“ARC Digital Canada”; and ARC Digital Canada together with
ARC Canada, “Canadian Borrowers”), US Borrower and Canadian Borrowers are
collectively referred to as “Borrowers”), the lenders party thereto as
“Lenders”, Agent, and Wells Fargo Capital Finance Corporation Canada, an Ontario
corporation, as administrative agent for the Canadian Lenders, the Lender Group
has agreed to make certain financial accommodations available to Borrowers from
time to time pursuant to the terms and conditions thereof; and

WHEREAS, the members of Lender Group and the Canadian Bank Product Providers are
willing to make the financial accommodations to Borrowers as provided for in the
Credit Agreement, the other Loan Documents, and the Canadian Bank Product
Agreements, but only upon the condition, among others, that the Grantors shall
have executed and delivered to Agent, for the benefit of the Canadian Lenders
and the Canadian Bank Product Providers, that certain Canadian Guaranty and
Security Agreement, dated as of January     , 2012 (including all annexes,
exhibits or schedules thereto, as from time to time amended, restated,
supplemented or otherwise modified, the “Guaranty and Security Agreement”); and

WHEREAS, pursuant to the Guaranty and Security Agreement, Grantors are required
to execute and deliver to Agent, for the benefit of the Canadian Lenders and the
Canadian Bank Product Providers, this Patent Security Agreement;

NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each Grantor hereby agrees as
follows:

1. DEFINED TERMS. All initially capitalized terms used but not otherwise defined
herein have the meanings given to them in the Guaranty and Security Agreement
or, if not defined therein, in the Credit Agreement, and this Patent Security
Agreement shall be subject to the rules of construction set forth in
Section 1(b) of the Guaranty and Security Agreement, which rules of construction
are incorporated herein by this reference, mutatis mutandis.

 

B-1

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2. GRANT OF SECURITY INTEREST IN PATENT COLLATERAL. Each Grantor hereby
unconditionally grants, assigns, and pledges to Agent, for the benefit each
member of the Lender Group and each of the Canadian Bank Product Providers, to
secure the Secured Obligations, a continuing security interest (referred to in
this Patent Security Agreement as the “Security Interest”) in all of such
Grantor’s right, title and interest in and to the following, whether now owned
or hereafter acquired or arising (collectively, the “Patent Collateral”):

(a) all of its Patents and Patent Intellectual Property Licenses to which it is
a party including those referred to on Schedule I;

(b) all divisionals, continuations, continuations-in-part, reissues,
reexaminations, or extensions of the foregoing; and

(c) all products and proceeds of the foregoing, including any claim by such
Grantor against third parties for past, present or future infringement of any
Patent or any Patent exclusively licensed under any Intellectual Property
License, including the right to receive damages, or right to receive license
fees, royalties, and other compensation under any Patent Intellectual Property
License.

3. SECURITY FOR SECURED OBLIGATIONS. This Patent Security Agreement and the
Security Interest created hereby secures the payment and performance of the
Secured Obligations, whether now existing or arising hereafter. Without limiting
the generality of the foregoing, this Patent Security Agreement secures the
payment of all amounts which constitute part of the Secured Obligations and
would be owed by Grantors, or any of them, to Agent, the other members of the
Lender Group, the Canadian Bank Product Providers or any of them, whether or not
they are unenforceable or not allowable due to the existence of an Insolvency
Proceeding involving any Grantor.

4. SECURITY AGREEMENT. The Security Interest granted pursuant to this Patent
Security Agreement is granted in conjunction with the security interests granted
to Agent, for the benefit of the Lender Group and the Canadian Bank Product
Providers, pursuant to the Guaranty and Security Agreement. Each Grantor hereby
acknowledges and affirms that the rights and remedies of Agent with respect to
the Security Interest in the Patent Collateral made and granted hereby are more
fully set forth in the Guaranty and Security Agreement, the terms and provisions
of which are incorporated by reference herein as if fully set forth herein. To
the extent there is any inconsistency between this Patent Security Agreement and
the Guaranty and Security Agreement, the Guaranty and Security Agreement shall
control.

5. AUTHORIZATION TO SUPPLEMENT. If any Grantor shall obtain rights to any new
patent application or issued patent or become entitled to the benefit of any
patent application or patent for any divisional, continuation,
continuation-in-part, reissue, or reexamination of any existing patent or patent
application, the provisions of this Patent Security Agreement shall
automatically apply thereto. Grantors shall give ten (10) Business Days’ notice
in writing to Agent after acquisition of any such new patent rights. Without
limiting Grantors’ obligations under this Section, Grantors hereby authorize
Agent unilaterally to modify this Patent Security Agreement by amending Schedule
I to include any such new patent rights of each Grantor. Notwithstanding the
foregoing, no failure to so modify this Patent Security Agreement or amend
Schedule I shall in any way affect, invalidate or detract from Agent’s
continuing security interest in all Patent Collateral, whether or not listed on
Schedule I.

 

B-2

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6. COUNTERPARTS. This Patent Security Agreement is a Loan Document. This Patent
Security Agreement may be executed in any number of counterparts and by
different parties on separate counterparts, each of which, when executed and
delivered, shall be deemed to be an original, and all of which, when taken
together, shall constitute but one and the same Patent Security Agreement.
Delivery of an executed counterpart of this Patent Security Agreement by
telefacsimile or other electronic method of transmission shall be equally as
effective as delivery of an original executed counterpart of this Patent
Security Agreement. Any party delivering an executed counterpart of this Patent
Security Agreement by telefacsimile or other electronic method of transmission
also shall deliver an original executed counterpart of this Patent Security
Agreement but the failure to deliver an original executed counterpart shall not
affect the validity, enforceability, and binding effect of this Patent Security
Agreement.

7. CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE PROVISION.
THIS PATENT SECURITY AGREEMENT SHALL BE SUBJECT TO THE PROVISIONS REGARDING
CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE SET FORTH IN
SECTION 25 OF THE GUARANTY AND SECURITY AGREEMENT, AND SUCH PROVISIONS ARE
INCORPORATED HEREIN BY THIS REFERENCE, MUTATIS MUTANDIS.

[signature page follows]

 

B-3

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IN WITNESS WHEREOF, the parties hereto have caused this Patent Security
Agreement to be executed and delivered as of the day and year first above
written.

 

GRANTORS:    

 

    By:  

 

    Name:  

 

    Title:      

 

    By:  

 

    Name:  

 

    Title:       ACCEPTED AND ACKNOWLEDGED BY: AGENT:     WELLS FARGO BANK,
NATIONAL ASSOCIATION     By:  

 

    Name:  

 

    Title:  

[SIGNATURE PAGE TO PATENT SECURITY AGREEMENT]

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

SCHEDULE I

to

PATENT SECURITY AGREEMENT

Patents

 

Grantor

 

Country

 

Patent

  

Application/

Patent No.

  

Filing Date

                                                                               

Patent Licenses

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EXHIBIT C

PLEDGED INTERESTS ADDENDUM

This Pledged Interests Addendum, dated as of                  , 20     (this
“Pledged Interests Addendum”), is delivered pursuant to Section 7 of the
Guaranty and Security Agreement referred to below. The undersigned hereby agrees
that this Pledged Interests Addendum may be attached to that certain Guaranty
and Security Agreement, dated as of January     , 2012, (as amended, restated,
supplemented, or otherwise modified from time to time, the “Guaranty and
Security Agreement”), made by the undersigned, together with the other Grantors
named therein, to WELLS FARGO BANK, NATIONAL ASSOCIATION, as Agent. Initially
capitalized terms used but not defined herein shall have the meaning ascribed to
such terms in the Guaranty and Security Agreement or, if not defined therein, in
the Credit Agreement, and this Pledged Interests Addendum shall be subject to
the rules of construction set forth in Section 1(b) of the Guaranty and Security
Agreement, which rules of construction are incorporated herein by this
reference, mutatis mutandis. The undersigned hereby agrees that the additional
interests listed on Schedule I shall be and become part of the Pledged Interests
pledged by the undersigned to Agent in the Guaranty and Security Agreement and
any pledged company set forth on Schedule I shall be and become a “Pledged
Company” under the Guaranty and Security Agreement, each with the same force and
effect as if originally named therein.

This Pledged interests Addendum is a Loan Document. Delivery of an executed
counterpart of this Pledged Interests Addendum by telefacsimile or other
electronic method of transmission shall be equally as effective as delivery of
an original executed counterpart of this Pledged Interests Addendum. If the
undersigned delivers an executed counterpart of this Pledged Interests Addendum
by telefacsimile or other electronic method of transmission, the undersigned
shall also deliver an original executed counterpart of this Pledged Interests
Addendum but the failure to deliver an original executed counterpart shall not
affect the validity, enforceability, and binding effect of this Pledged
Interests Addendum.

The undersigned hereby certifies that the representations and warranties set
forth in Section 6 of the Guaranty and Security Agreement of the undersigned are
true and correct as to the Pledged Interests listed herein on and as of the date
hereof.

THIS PLEDGED INTERESTS ADDENDUM SHALL BE SUBJECT TO THE PROVISIONS REGARDING
CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE SET FORTH IN
SECTION 25 OF THE GUARANTY AND SECURITY AGREEMENT, AND SUCH PROVISIONS ARE
INCORPORATED HEREIN BY THIS REFERENCE, MUTATIS MUTANDIS.

[signature page follows]

 

C-1

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IN WITNESS WHEREOF, the undersigned has caused this Pledged Interests Addendum
to be executed and delivered as of the day and year first above written.

 

 

  By:  

 

Name:  

 

Title:    

[SIGNATURE PAGE TO PLEDGED INTERESTS ADDENDUM]

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SCHEDULE I

to

PLEDGED INTERESTS ADDENDUM

Pledged Interests

 

Name of Grantor

 

Name of Pledged
Company

 

Number of

Shares/Units

  

Class of

Interests

  

Percentage

of Class

Owned

  

Certificate

Nos.

                                      

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EXHIBIT D

TRADEMARK SECURITY AGREEMENT

This TRADEMARK SECURITY AGREEMENT (this “Trademark Security Agreement”) is made
this      day of             , 20    , by and among Grantors listed on the
signature pages hereof (collectively, jointly and severally, “Grantors” and each
individually “Grantor”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, in its
capacity as agent for the Lender Group and the Canadian Bank Product Providers
(in such capacity, together with its successors and assigns in such capacity,
“Agent”).

W I T N E S S E T H:

WHEREAS, pursuant to that certain Credit Agreement dated as of January     ,
2012 (as amended, restated, supplemented, or otherwise modified from time to
time, the “Credit Agreement”) by and among American Reprographics Company, a
Delaware corporation (“US Borrower”), ARC Reprographics Canada Corp., a British
Columbia corporation (“ARC Canada”) and ARC Digital Canada Corp., a British
Columbia corporation (“ARC Digital Canada”; and ARC Digital Canada together with
ARC Canada, “Canadian Borrowers”), US Borrower and Canadian Borrowers are
collectively referred to as “Borrowers”), the lenders party thereto as
“Lenders”, Agent, and Wells Fargo Capital Finance Corporation Canada, an Ontario
corporation, as administrative agent for the Canadian Lenders, the Lender Group
has agreed to make certain financial accommodations available to Borrowers from
time to time pursuant to the terms and conditions thereof; and

WHEREAS, the members of the Lender Group and the Canadian Bank Product Providers
are willing to make the financial accommodations to Borrowers as provided for in
the Credit Agreement, the other Loan Documents, and the Canadian Bank Product
Agreements, but only upon the condition, among others, that Grantors shall have
executed and delivered to Agent, for the benefit of the Canadian Lenders and the
Canadian Bank Product Providers, that certain Canadian Guaranty and Security
Agreement, dated as of January     , 2012 (including all annexes, exhibits or
schedules thereto, as from time to time amended, restated, supplemented or
otherwise modified, the “Guaranty and Security Agreement”); and

WHEREAS, pursuant to the Guaranty and Security Agreement, Grantors are required
to execute and deliver to Agent, for the benefit of the Canadian Lenders and the
Canadian Bank Product Providers, this Trademark Security Agreement;

NOW, THEREFORE, in consideration of the premises and mutual covenants herein
contained and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, each Grantor hereby agrees as
follows:

1. DEFINED TERMS. All initially capitalized terms used but not otherwise defined
herein have the meanings given to them in the Guaranty and Security Agreement
or, if not defined therein, in the Credit Agreement, and this Trademark Security
Agreement shall be subject to the rules of construction set forth in
Section 1(b) of the Guaranty and Security Agreement, which rules of construction
are incorporated herein by this reference, mutatis mutandis.

 

D-1

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2. GRANT OF SECURITY INTEREST IN TRADEMARK COLLATERAL. Each Grantor hereby
unconditionally grants, assigns, and pledges to Agent, for the benefit each
member of the Lender Group and each of the Canadian Bank Product Providers, to
secure the Secured Obligations, a continuing security interest (referred to in
this Trademark Security Agreement as the “Security Interest”) in all of such
Grantor’s right, title and interest in and to the following, whether now owned
or hereafter acquired or arising (collectively, the “Trademark Collateral”):

(a) all of its Trademarks and Trademark Intellectual Property Licenses to which
it is a party including those referred to on Schedule I;

(b) all goodwill of the business connected with the use of, and symbolized by,
each Trademark and each Trademark Intellectual Property License; and

(c) all products and proceeds (as that term is defined in the PPSA) of the
foregoing, including any claim by such Grantor against third parties for past,
present or future (i) infringement or dilution of any Trademark or any
Trademarks exclusively licensed under any Intellectual Property License,
including right to receive any damages, (ii) injury to the goodwill associated
with any Trademark, or (iii) right to receive license fees, royalties, and other
compensation under any Trademark Intellectual Property License.

3. SECURITY FOR SECURED OBLIGATIONS. This Trademark Security Agreement and the
Security Interest created hereby secures the payment and performance of the
Secured Obligations, whether now existing or arising hereafter. Without limiting
the generality of the foregoing, this Trademark Security Agreement secures the
payment of all amounts which constitute part of the Secured Obligations and
would be owed by Grantors, or any of them, to Agent, the other members of the
Lender Group, the Canadian Bank Product Providers or any of them, whether or not
they are unenforceable or not allowable due to the existence of an Insolvency
Proceeding involving any Grantor.

4. SECURITY AGREEMENT. The Security Interest granted pursuant to this Trademark
Security Agreement is granted in conjunction with the security interests granted
to Agent, for the benefit of the Lender Group and the Canadian Bank Product
Providers, pursuant to the Guaranty and Security Agreement. Each Grantor hereby
acknowledges and affirms that the rights and remedies of Agent with respect to
the Security Interest in the Trademark Collateral made and granted hereby are
more fully set forth in the Guaranty and Security Agreement, the terms and
provisions of which are incorporated by reference herein as if fully set forth
herein. To the extent there is any inconsistency between this Trademark Security
Agreement and the Guaranty and Security Agreement, the Guaranty and Security
Agreement shall control.

5. AUTHORIZATION TO SUPPLEMENT. If any Grantor shall obtain rights to any new
trademarks, the provisions of this Trademark Security Agreement shall
automatically apply thereto. Grantors shall give notice in writing to Agent
within ten (10)

 

D-2

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Business Days after the acquisition of any such new trademarks or renewal or
extension of any trademark registration. Without limiting Grantors’ obligations
under this Section, Grantors hereby authorize Agent unilaterally to modify this
Trademark Security Agreement by amending Schedule I to include any such new
trademark rights of each Grantor. Notwithstanding the foregoing, no failure to
so modify this Trademark Security Agreement or amend Schedule I shall in any way
affect, invalidate or detract from Agent’s continuing security interest in all
Collateral, whether or not listed on Schedule I.

6. COUNTERPARTS. This Trademark Security Agreement is a Loan Document. This
Trademark Security Agreement may be executed in any number of counterparts and
by different parties on separate counterparts, each of which, when executed and
delivered, shall be deemed to be an original, and all of which, when taken
together, shall constitute but one and the same Trademark Security Agreement.
Delivery of an executed counterpart of this Trademark Security Agreement by
telefacsimile or other electronic method of transmission shall be equally as
effective as delivery of an original executed counterpart of this Trademark
Security Agreement. Any party delivering an executed counterpart of this
Trademark Security Agreement by telefacsimile or other electronic method of
transmission also shall deliver an original executed counterpart of this
Trademark Security Agreement but the failure to deliver an original executed
counterpart shall not affect the validity, enforceability, and binding effect of
this Trademark Security Agreement.

7. CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE PROVISION.
THIS TRADEMARK SECURITY AGREEMENT SHALL BE SUBJECT TO THE PROVISIONS REGARDING
CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE SET FORTH IN
SECTION 25 OF THE GUARANTY AND SECURITY AGREEMENT, AND SUCH PROVISIONS ARE
INCORPORATED HEREIN BY THIS REFERENCE, MUTATIS MUTANDIS.

[signature page follows]

 

D-3

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IN WITNESS WHEREOF, the parties hereto have caused this Trademark Security
Agreement to be executed and delivered as of the day and year first above
written.

 

GRANTORS:    

 

    By:  

 

    Name:  

 

    Title:      

 

    By:  

 

    Name:  

 

    Title:       ACCEPTED AND ACKNOWLEDGED BY: AGENT:     WELLS FARGO BANK,
NATIONAL ASSOCIATION     By:  

 

    Name:  

 

    Title:  

[SIGNATURE PAGE TO TRADEMARK SECURITY AGREEMENT]

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SCHEDULE I

to

TRADEMARK SECURITY AGREEMENT

Trademark Registrations/Applications

 

Grantor

 

Country

 

Mark

 

Application/

Registration No.

 

App/Reg Date

                                                               

Trade Names

Common Law Trademarks

Trademarks Not Currently In Use

Trademark Licenses