Exhibit 10.02

 

 

 

SECURITY AGREEMENT

dated as of

June 17, 2016

AMONG WEST CORPORATION,

THE OTHER GRANTORS IDENTIFIED HEREIN

and

U.S. BANK NATIONAL ASSOCIATION,

as Collateral Agent

 

 

 

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TABLE OF CONTENTS

 

ARTICLE I Definitions

     1   

SECTION 1.01.

 

Indenture

     1   

SECTION 1.02.

 

Other Defined Terms

     2   

ARTICLE II Pledge of Securities

     4   

SECTION 2.01.

 

Pledge

     4   

SECTION 2.02.

 

Delivery of the Pledged Collateral

     5   

SECTION 2.03.

 

Representations, Warranties and Covenants

     6   

SECTION 2.04.

 

Certification of Limited Liability Company and Limited Partnership Interests

     7   

SECTION 2.05.

 

Registration in Nominee Name: Denominations

     7   

SECTION 2.06.

 

Voting Rights; Dividends and Interest

     8   

ARTICLE III Security Interests in Personal Property

     9   

SECTION 3.01.

 

Security Interest

     9   

SECTION 3.02.

 

Representations and Warranties

     11   

SECTION 3.03.

 

Covenants

     13   

SECTION 3.04.

 

Other Actions

     14   

SECTION 3.05.

 

Post-Closing Actions

     15   

ARTICLE IV Remedies

     15   

SECTION 4.01.

 

Remedies Upon Default

     15   

SECTION 4.02.

 

Application of Proceeds

     17   

ARTICLE V Indemnity, Subrogation and Subordination

     17   

SECTION 5.01.

 

Indemnity

     17   

SECTION 5.02.

 

Contribution and Subrogation

     18   

SECTION 5.03.

 

Subordination

     18   

ARTICLE VI Miscellaneous

     18   

SECTION 6.01.

 

Notices

     18   

SECTION 6.02.

 

Waivers, Amendment

     18   

SECTION 6.03.

 

Collateral Agent’s Fees and Expenses; Indemnification

     19   

SECTION 6.04.

 

Successors and Assigns

     19   

SECTION 6.05.

 

Survival of Agreement

     19   

SECTION 6.06.

 

Counterparts; Effectiveness; Several Agreement

     19   

SECTION 6.07.

 

Severability

     20   

SECTION 6.08.

 

[Reserved]

     20   

 

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SECTION 6.09.

 

GOVERNING LAW

     20   

SECTION 6.10.

 

WAIVER OF RIGHT TO TRIAL BY JURY

     21   

SECTION 6.11.

 

Headings

     21   

SECTION 6.12.

 

Security Interest Absolute

     21   

SECTION 6.13.

 

Termination or Release

     21   

SECTION 6.14.

 

Intercreditor Agreements Govern

     22   

SECTION 6.15.

 

Additional Grantors

     22   

SECTION 6.16.

 

Collateral Agent Appointed Attorney-in-Fact

     23   

SECTION 6.17.

 

General Authority of the Collateral Agent

     23   

SECTION 6.18.

 

Rights of Collateral Agent in Respect of Collateral

     24   

SECTION 6.19.

 

FCC Licenses

     24   

 

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Schedules

Schedule I

 

Subsidiary Parties

Schedule II

 

Pledged Equity, Pledged Debt

Schedule III

 

Commercial Tort Claims

Exhibits

Exhibit I

 

Form of Security Agreement Supplement

Exhibit II

 

Form of Perfection Certificate

 

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SECURITY AGREEMENT, dated as of June 17, 2016, among WEST CORPORATION (the
“Company”), the other Grantors identified herein, including Grantors that become
party hereto pursuant to Section 6.15, and U.S. BANK, NATIONAL ASSOCIATION, as
Collateral Agent for the Secured Parties (as defined below) (in such capacity,
the “Collateral Agent”).

Reference is made to the Indenture, dated as of June 17, 2016 (as amended,
supplemented or otherwise modified from time to time, the “Indenture”), among
the Company, the Guarantors from time to time party thereto, the Collateral
Agent and U.S. Bank National Association, as trustee (in such capacity, the
“Trustee”).

W I T N E S S E T H:

WHEREAS, pursuant to the Indenture, the Company has issued or will issue
$400,000,000 principal amount of its 4.750% senior secured notes due 2021
(together with any Additional Notes issued pursuant to the Indenture, the
“Notes”) upon the terms and subject to the conditions set forth therein;

WHEREAS, pursuant to the Indenture, each Guarantor party thereto has
unconditionally and irrevocably guaranteed, as primarily obligor and not merely
as surety, to the Trustee, for the benefit of the Secured Parties, the prompt
and complete payment and performance when due (whether at stated maturity, by
acceleration or otherwise) of the Secured Obligations;

WHEREAS, U.S. Bank National Association has been appointed to serve as
Collateral Agent under the Indenture and, in such capacity, to enter into this
Agreement on behalf of the Secured Parties;

WHEREAS, each Grantor will derive substantial benefits from the issuance of the
Notes, and each is, therefore, willing to enter into this Agreement; and

WHEREAS, this Agreement is made by the Grantors in favor of the Collateral Agent
for the benefit of the Secured Parties to secure the payment and performance in
full when due of the Secured Obligations.

NOW, THEREFORE, in consideration of the premises and to induce the Holders to
purchase the Notes, the Grantors hereby agree with the Collateral Agent, for the
benefit of the Secured Parties, as follows:

ARTICLE I

Definitions

SECTION 1.01. Indenture. (a) Capitalized terms used in this Agreement and not
otherwise defined herein have the meanings specified in the Indenture. All terms
defined in the New York UCC (as defined herein) and not defined in this
Agreement have the meanings specified therein; the term “instrument” shall have
the meaning specified in Article 9 of the New York UCC (the “UCC”; provided
that, if perfection or the effect of perfection or non-perfection

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or the priority of the security interest in any Collateral is governed by the
Uniform Commercial Code as in effect in a jurisdiction other than the State of
New York, “UCC” means the Uniform Commercial Code as in effect from time to time
in such other jurisdiction for purposes of the provisions hereof relating to
such perfection, effect of perfection or non-perfection or priority).

(b) The rules of construction specified in Section 1.04 of the Indenture also
apply to this Agreement.

SECTION 1.02. Other Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:

“Account Debtor” means any Person who is or who may become obligated to any
Grantor under, with respect to or on account of an Account.

“Accounts” has the meaning specified in Article 9 of the New York UCC.

“Agreement” means this Security Agreement.

“Article 9 Collateral” has the meaning assigned to such term in Section 3.01.

“Claiming Party” has the meaning assigned to such term in Section 5.02.

“Collateral” means the Article 9 Collateral and the Pledged Collateral.

“Collateral Agent” has the meaning assigned to such term in the preliminary
statement of this Agreement and includes any permitted successor collateral
agent.

“Contributing Party” has the meaning assigned to such term in Section 5.02.

“Excluded Equity” has the meaning assigned to such term in Section 2.01.

“Existing Senior Credit Facilities” means the Credit Facilities under the
Amended and Restated Credit Agreement dated as of October 5, 2010 (as amended by
Amendment No. 1 to Amended and Restated Credit Agreement, dated as of August 15,
2012, Amendment No. 2 to Amended and Restated Credit Agreement, dated as of
October 24, 2012, Amendment No. 3 to Amended and Restated Credit Agreement;
Amendment No. 1 to Guarantee Agreement, dated as of February 20, 2013, Amendment
No. 4 to Amended and Restated Credit Agreement, dated as of January 24, 2014,
Amendment No. 5 to Amended and Restated Credit Agreement, dated as of July 1,
2014, Amendment No. 6 to Amended and Restated Credit Agreement, dated as of
November 24, 2015 and Amendment No. 7 to Amended and Restated Credit Agreement,
to be dated on or about the Issue Date), by and among the Company, the lenders
party thereto in their capacities as lenders thereunder and Wells Fargo Bank,
National Association, as Administrative Agent and Swing Line Lender, the other
agents, arrangers and bookrunners from time to time party thereto, including any
guarantees, collateral documents, instruments and agreements executed in
connection therewith, and any amendments, supplements, modifications,
extensions, renewals, restatements, refundings, refinancings or replacements
thereof and any one or more indentures or credit facilities or commercial paper
facilities with banks or other institutional lenders or investors, whether or
not secured, that

 

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replace, refund, supplement or refinance any part of the loans, accordion
facilities, notes, other credit facilities or commitments thereunder, including
any such replacement, refunding or refinancing facility or indenture that
increases the amount borrowable or issuable thereunder or alters the maturity
thereof (provided that such increase in borrowings or issuances is permitted
under Section 4.09 of the Indenture) or adds Restricted Subsidiaries as
additional borrowers or guarantors thereunder and whether by the same or any
other agent, trustee, lender or group of lenders or holders.. Any agreement
which is the “Credit Agreement” for purposes of the Pari Passu Intercreditor
Agreement shall be deemed Existing Senior Credit Facilities for the purposes of
Section 2.02 hereof.

“FCC Licenses” has the meaning assigned to such term in Section 3.01.

“General Intangibles” has the meaning specified in Article 9 of the New York
UCC.

“Grantor” means the Company and each Subsidiary Party.

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

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

“Notes Documents” means the Notes, the Indenture, the Guarantees, the Security
Documents and the Intercreditor Agreements.

“Perfection Certificate” means a certificate substantially in the form of
Exhibit II, completed and supplemented with the schedules and attachments
contemplated thereby, and duly executed by the Company.

“Pledged Collateral” has the meaning assigned to such term in Section 2.01.

“Pledged Debt” has the meaning assigned to such term in Section 2.01.

“Pledged Equity” has the meaning assigned to such term in Section 2.01.

“Pledged Securities” means any promissory notes, stock certificates or other
securities now or hereafter included in the Pledged Collateral, including all
certificates, instruments or other documents representing or evidencing any
Pledged Collateral.

“Secured Obligations” means any principal, premium, interest, fees, expenses
(including any interest, fees and expenses accruing after the commencement of
any bankruptcy, reorganization or similar proceeding by or against any Grantor,
whether or not such interest, fees or expenses are an allowed or allowable claim
in such proceeding), penalties, indemnifications, reimbursements, damages and
other liabilities, and guarantees of payment of such principal, interest,
penalties, fees, indemnifications, reimbursements, damages and other liabilities
(including any fees or expenses owed to the Trustee or the Collateral Agent, in
their respective capacities as such) by any Grantor, payable or arising under
any of the Indenture, the Notes, this Agreement and the other Notes Documents.

 

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“Secured Parties” means, collectively, (i) the Holders, (ii) the Trustee,
(iii) the Collateral Agent and (iv) any successors, indorsees, transferees and
assigns of any of the foregoing.

“Security Agreement Supplement” means an instrument in the form of Exhibit I
hereto.

“Security Interest” has the meaning assigned to such term in Section 3.01(a).

“Subsidiary Parties” means (a) the Restricted Subsidiaries identified on
Schedule I and (b) each other Guarantor that is a Restricted Subsidiary that
becomes a party to this Agreement as a Subsidiary Party after the Issue Date.

ARTICLE II

Pledge of Securities

SECTION 2.01. Pledge. As security for the payment or performance, as the case
may be, in full of the Secured Obligations, including the Guarantees, each
Grantor hereby assigns and pledges to the Collateral Agent, its successors and
assigns, for the benefit of the Secured Parties, and hereby grants to the
Collateral Agent, its successors and assigns, for the benefit of the Secured
Parties, a security interest in, all of such Grantor’s right, title and interest
in, to and under:

(i) all Equity Interests held by it and listed on Schedule II and any other
Equity Interests obtained in the future by such Grantor and the certificates
representing all such Equity Interests (the “Pledged Equity”); provided that the
Pledged Equity shall not include (A) more than 65% of the issued and outstanding
Equity Interests of any Foreign Subsidiary or FSHCO, (B) Equity Interests of
Immaterial Subsidiaries, (C) Equity Interests of Unrestricted Subsidiaries,
(D) Equity Interests of Excluded Receivables Management Subsidiaries pledged to
secure Indebtedness permitted under Section 4.09(b)(21) of the Indenture or if
the creation of a Lien on the Equity Interests of such Excluded Receivables
Management Subsidiary is not permitted or would (including upon foreclosure
thereof) result in a change of control (or similar event), default, termination,
payment, purchase or repurchase obligation pursuant to the terms of any
Receivables Management Financing, any service agreement (or similar arrangement)
required by or entered into in connection with such Receivables Management
Financing or any credit support provided by it in favor of any financier of such
Receivables Management Financing, (E) Equity Interests of any Person that is not
a direct or indirect Wholly-Owned Subsidiary of the Company (F) Equity Interests
of any Restricted Subsidiary pledged to secure Indebtedness permitted under
Section 7.03(g) of the Senior Credit Facilities as in effect on the date hereof,
(G) Equity Interests of any Subsidiary with respect to which the Company and the
Senior Credit Facilities Agent have determined in writing, confirmed in a notice
delivered to the Collateral Agent, where the costs or other consequences
(including adverse tax

 

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consequences) of providing a pledge of its Equity Interests is excessive in view
of the benefits afforded thereby (the assets described in clauses (A) through
(G) of this proviso being the “Excluded Equity”);

(ii) (A) the debt securities owned by it and listed opposite the name of such
Grantor on Schedule II, (B) any debt securities obtained in the future by such
Grantor and (C) the promissory notes and any other instruments evidencing such
debt securities (the “Pledged Debt”);

(iii) all other property that may be delivered to and held by the Collateral
Agent pursuant to the terms of this Section 2.01;

(iv) subject to Section 2.06, all payments of principal or interest, dividends,
cash, instruments and other property from time to time received, receivable or
otherwise distributed in respect of, in exchange for or upon the conversion of,
and all other Proceeds received in respect of, the securities referred to in
clauses (i) and (ii) above;

(v) subject to Section 2.06, all rights and privileges of such Grantor with
respect to the securities and other property referred to in clauses (i), (ii),
(iii) and (iv) above; and

(vi) all Proceeds of any of the foregoing (the items referred to in clauses
(i) through (vi) above being collectively referred to as the “Pledged
Collateral”).

TO HAVE AND TO HOLD the Pledged Collateral, together with all right, title,
interest, powers, privileges and preferences pertaining or incidental thereto,
unto the Collateral Agent, its successors and assigns, for the benefit of the
Secured Parties, forever; subject, however, to the terms, covenants and
conditions hereinafter set forth.

SECTION 2.02. Delivery of the Pledged Collateral. (a) Subject to Section 2.09 of
the Pari Passu Intercreditor Agreement, each Grantor agrees to promptly deliver
or cause to be delivered to the Collateral Agent, for the benefit of the Secured
Parties, any and all Pledged Securities (other than any uncertificated
securities, but only for so long as such securities remain uncertificated) to
the extent such Pledged Securities, in the case of promissory notes or other
instruments evidencing Indebtedness, are required to be delivered pursuant to
paragraph (b) of this Section 2.02.

(b) Subject to Section 2.09 of the Pari Passu Intercreditor Agreement, each
Grantor will cause any Indebtedness for borrowed money having an aggregate
principal amount in excess of $5,000,000 owed to such Grantor by any Person that
is evidenced by a duly executed promissory note to be pledged and delivered to
the Collateral Agent, for the benefit of the Secured Parties, pursuant to the
terms hereof.

(c) Subject to Section 2.09 of the Pari Passu Intercreditor Agreement, upon
delivery to the Collateral Agent, (i) any Pledged Securities shall be
accompanied by stock powers duly executed in blank or other instruments of
transfer reasonably satisfactory to the Collateral Agent and by such other
instruments and documents as the

 

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

SECTION 2.03. Representations, Warranties and Covenants. Each Grantor jointly
and severally represents, warrants and covenants, as to itself and the other
Grantors, to and with the Collateral Agent, for the benefit of the Secured
Parties, that:

(a) As of the date hereof, Schedule II correctly sets forth the percentage of
the issued and outstanding units of each class of the Equity Interests of the
issuer thereof represented by the Pledged Equity and includes all Equity
Interests, debt securities and promissory notes outstanding on the date hereof,
other than any excluded from the Collateral pursuant to the proviso to
Section 2.01(i) or proviso to Section 3.01(a), required to be pledged hereunder;

(b) the Pledged Equity and Pledged Debt (solely with respect to Pledged Debt
issued by a Person other than the Company or a Subsidiary of the Company, to the
best of such Grantor’s knowledge) have been duly and validly authorized and
issued by the issuers thereof and (i) in the case of Pledged Equity, are fully
paid and nonassessable and (ii) in the case of Pledged Debt (solely with respect
to Pledged Debt issued by a Person other than the Company or a Subsidiary of the
Company, to the best of the such Grantor’s knowledge), are legal, valid and
binding obligations of the issuers thereof;

(c) except for the security interests granted hereunder and subject to the Pari
Passu Intercreditor Agreement, each of the Grantors (i) is and, subject to any
transfers made in compliance with the Indenture, will continue to be the direct
owner, beneficially and of record, of the Pledged Securities indicated on
Schedule II as owned by such Grantors, (ii) holds the same free and clear of all
Liens, other than (A) Liens created by the Security Documents and (B) Liens
expressly permitted pursuant to Section 4.12 of the Indenture, (iii) will make
no assignment, pledge, hypothecation or transfer of, or create or permit to
exist any security interest in or other Lien on, the Pledged Collateral, other
than (A) Liens created by the Security Documents and (B) Liens expressly
permitted pursuant to Section 4.12 of the Indenture and (C) transfers made in
compliance with the Indenture, (iv) will defend its title or interest thereto or
therein against any and all Liens (other than the Liens permitted pursuant to
this Section 2.03(c)), however arising, of all Persons whomsoever;

(d) except for restrictions and limitations imposed by (i) the Notes Documents,
(ii) securities laws generally, (iii) customary provisions in joint venture
agreements relating to purchase options, rights of first refusal, tag, drag,
call or similar rights of a third party that owns Equity Interests in such joint
venture or (iv) rules and regulations promulgated by the Federal Communications
Commission and other similar

 

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federal and state laws, rules and regulations relating to the telecommunications
industry and except (A) as described in the Perfection Certificate and
(B) transactions otherwise permitted by Sections 4.08 and 4.12 of the Indenture,
the Pledged Collateral is and will continue to be freely transferable and
assignable, and none of the Pledged Collateral is or will be subject to any
option, right of first refusal, shareholders agreement, charter or by-law
provisions or contractual restriction of any nature that might prohibit, impair,
delay or otherwise affect in any manner material and adverse to the Secured
Parties the pledge of such Pledged Collateral hereunder, the sale or disposition
thereof pursuant hereto or the exercise by the Collateral Agent of rights and
remedies hereunder;

(e) each of the Grantors has the power and authority to pledge the Pledged
Collateral pledged by it hereunder in the manner hereby done or contemplated;

(f) by virtue of the execution and delivery by the Grantors of this Agreement,
when any Pledged Securities are delivered to the Collateral Agent in accordance
with this Agreement (subject to Section 2.09 of the Pari Passu Intercreditor
Agreement) or to the Collateral Agent’s bailee pursuant to the Pari Passu
Intercreditor Agreement, the Collateral Agent will obtain a legal, valid and
perfected lien upon and security interest in such Pledged Securities as security
for the payment and performance of the Secured Obligations; and

(g) the pledge effected hereby is effective to vest in the Collateral Agent, for
the benefit of the Secured Parties, the rights of the Collateral Agent in the
Pledged Collateral as set forth herein (subject to Section 2.09 of the Pari
Passu Intercreditor Agreement).

SECTION 2.04. Certification of Limited Liability Company and Limited Partnership
Interests. Subject to Section 2.09 of the Pari Passu Intercreditor Agreement, no
interest in any limited liability company or limited partnership controlled by
any Grantor that constitutes Pledged Equity shall be represented by a
certificate unless (i) the limited liability company agreement or partnership
agreement expressly provides that such interests shall be a “security” within
the meaning of Article 8 of the UCC of the applicable jurisdiction, and
(ii) such certificate shall be delivered to the Collateral Agent in accordance
with Section 2.02 hereof.

SECTION 2.05. Registration in Nominee Name: Denominations. Subject to
Section 2.09 of the Pari Passu Intercreditor Agreement, if an Event of Default
shall occur and be continuing and the Collateral Agent shall give the Company
notice of its intent to exercise such rights, (a) the Collateral Agent, on
behalf of the Secured Parties, shall have the right (acting at the written
direction of the majority of Holders) to hold the Pledged Securities in its own
name as pledgee, the name of its nominee (as pledgee or as sub-agent) or the
name of the applicable Grantor, endorsed or assigned in blank or in favor of the
Collateral Agent and each Grantor will promptly give to the Collateral Agent
copies of any notices or other communications received by it with respect to
Pledged Securities registered in the name of such Grantor and (b) the Collateral
Agent shall have the right to exchange the certificates representing Pledged
Securities for certificates of smaller or larger denominations for any purpose
consistent with this Agreement.

 

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SECTION 2.06. Voting Rights; Dividends and Interest. (a) Unless and until an
Event of Default shall have occurred and be continuing and the Collateral Agent
shall have notified the Company, that the rights of the Grantors under this
Section 2.06 are being suspended:

(i) Each Grantor shall be entitled to exercise any and all voting and/or other
consensual rights and powers inuring to an owner of Pledged Securities or any
part thereof for any purpose consistent with the terms of this Agreement, the
Indenture and the other Notes Documents.

(ii) The Collateral Agent shall execute and deliver to each Grantor, or cause to
be executed and delivered to such Grantor, all such proxies, powers of attorney
and other instruments as such Grantor may reasonably request for the purpose of
enabling such Grantor to exercise the voting and/or consensual rights and powers
it is entitled to exercise pursuant to subparagraph (i) above.

(iii) Each Grantor shall be entitled to receive and retain any and all
dividends, interest, principal and other distributions paid on or distributed in
respect of the Pledged Securities to the extent and only to the extent that such
dividends, interest, principal and other distributions are permitted by, and
otherwise paid or distributed in accordance with, the terms and conditions of
the Indenture, the other Notes Documents and applicable laws; provided that any
noncash dividends, interest, principal or other distributions that would
constitute Pledged Equity or Pledged Debt, whether resulting from a subdivision,
combination or reclassification of the outstanding Equity Interests of the
issuer of any Pledged Securities or received in exchange for Pledged Securities
or any part thereof, or in redemption thereof, or as a result of any merger,
consolidation, acquisition or other exchange of assets to which such issuer may
be a party or otherwise, shall be and become part of the Pledged Collateral,
and, if received by any Grantor, shall not be commingled by such Grantor with
any of its other funds or property but shall be held separate and apart
therefrom, shall be held in trust for the benefit of the Collateral Agent and
the Secured Parties and shall be forthwith delivered to the Collateral Agent in
the same form as so received (with any necessary endorsement reasonably
requested by the Collateral Agent).

(b) Upon the occurrence and during the continuance of an Event of Default, after
the Collateral Agent shall have notified the Company of the suspension of the
rights of the Grantors under paragraph (a)(iii) of this Section 2.6, subject to
the Pari Passu Intercreditor Agreement, then all rights of any Grantor to
dividends, interest, principal or other distributions that such Grantor is
authorized to receive pursuant to paragraph (a)(iii) of this Section 2.06 shall
cease, and all such rights shall thereupon become vested in the Collateral
Agent, which shall have the sole and exclusive right and authority to receive
and retain such dividends, interest, principal or other distributions. All
dividends, interest, principal or other distributions received by any Grantor
contrary to the provisions of this Section 2.06 shall be held in trust for the
benefit of the Collateral Agent, shall be segregated from other property or
funds of such Grantor and shall be forthwith delivered to the Collateral Agent
upon demand in the

 

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same form as so received (with any necessary endorsement reasonably requested by
the Collateral Agent). Subject to the Pari Passu Intercreditor Agreement, any
and all money and other property paid over to or received by the Collateral
Agent pursuant to the provisions of this paragraph (b) shall be retained by the
Collateral Agent in an account to be established by the Collateral Agent upon
receipt of such money or other property and shall be applied in accordance with
the provisions of Section 4.02 hereof. After all Events of Default have been
cured or waived, the Collateral Agent shall promptly repay to each Grantor
(without interest) all dividends, interest, principal or other distributions
that such Grantor would otherwise be permitted to retain pursuant to the terms
of paragraph (a)(iii) of this Section 2.06 and that remain in such account.

(c) Upon the occurrence and during the continuance of an Event of Default, after
the Collateral Agent shall have notified the Company of the suspension of the
rights of the Grantors under paragraph (a)(i) of this Section 2.06, then all
rights of any Grantor to exercise the voting and consensual rights and powers it
is entitled to exercise pursuant to paragraph (a)(i) of this Section 2.06, and
the obligations of the Collateral Agent under paragraph (a)(ii) of this
Section 2.06, shall cease, and all such rights shall thereupon become vested in
the Collateral Agent, which shall have the sole and exclusive right and
authority to exercise such voting and consensual rights and powers; provided
that, unless otherwise directed by the majority of Holders, the Collateral Agent
shall have the right from time to time following and during the continuance of
an Event of Default to permit the Grantors to exercise such rights. After all
Events of Default have been cured or waived, each Grantor shall have the
exclusive right to exercise the voting and/or consensual rights and powers that
such Grantor would otherwise be entitled to exercise pursuant to the terms of
paragraph (a)(i) above.

(d) Any notice given by the Collateral Agent to the Company suspending the
rights of the Grantors under paragraph (a) of this Section 2.06 (i) shall be
given in writing, (ii) may be given with respect to one or more of the Grantors
at the same or different times and (iii) may suspend the rights of the Grantors
under paragraph (a)(i) or paragraph (a)(iii) in part without suspending all such
rights (as specified by the Collateral Agent acting at the direction of a
majority of Holders) and without waiving or otherwise affecting the Collateral
Agent’s rights to give additional notices from time to time suspending other
rights so long as an Event of Default has occurred and is continuing.

ARTICLE III

Security Interests in Personal Property

SECTION 3.01. Security Interest. (a) As security for the payment or performance,
as the case may be, in full of the Secured Obligations, including the Guarantees
of the Grantors, each Grantor hereby assigns and pledges to the Collateral
Agent, its successors and assigns, for the benefit of the Secured Parties, and
hereby grants to the Collateral Agent, its successors and assigns, for the
benefit of the Secured Parties, a security interest (the “Security Interest”)
in, all right, title or interest in or to any and all of the following assets
and properties now owned or at any time hereafter acquired by such Grantor or in
which such Grantor now has

 

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or at any time in the future may acquire any right, title or interest
(collectively, the “Article 9 Collateral”):

(i) all Accounts;

(ii) all Chattel Paper;

(iii) all Documents;

(iv) all Equipment;

(v) all General Intangibles;

(vi) all Instruments;

(vii) all Inventory;

(viii) all Investment Property;

(ix) all Letter-of-Credit Rights;

(x) the Commercial Tort Claims described on Schedule III and on any supplement
thereto received by the Collateral Agent pursuant to Section 3.04(c) hereof;

(xi) all books and records pertaining to the Article 9 Collateral; and

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

provided that notwithstanding anything to the contrary in this Agreement, this
Agreement shall not constitute a grant of a security interest in (A) motor
vehicles or other assets subject to certificates of title, (B) deposit accounts
or securities accounts (other than any Proceeds of other Collateral),
(C) Receivables Management Assets owned by, or owing to, any Person (other than
the Company or a Restricted Subsidiary) or held in trust for the benefit of any
such Person, and the Equity Interests of Excluded Receivables Management
Subsidiaries, (D) any Excluded Equity, (E) any asset with respect to which the
Senior Credit Facilities Agent has confirmed in writing to the Company confirmed
in a notice delivered to the Collateral Agent by the Company, its determination
that the costs or other consequences (including any adverse tax consequences) of
providing a security interest in is excessive in view of the benefits to be
obtained by the holders of First Lien Obligations, (F) any General Intangible,
Investment Property or other property or rights of a Grantor arising under or
evidenced by any contract, lease, instrument, license or other document if (but
only to the extent that) the grant of a security interest therein would
(x) constitute a violation of a valid and enforceable restriction in respect of
such General Intangible, Investment Property or other property or rights in
favor of a third party or under any law, regulation, permit, order or decree of
any Governmental Authority, unless and until all required consents shall have
been obtained (for the avoidance of doubt, the restrictions described

 

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herein are not negative pledges or similar undertakings in favor of a lender or
other financial counterparty) or (y) expressly give any other party in respect
of any such contract, lease, instrument, license or other document, the right to
terminate its obligations thereunder, provided, however, that the limitation set
forth in clause (F) above shall not affect, limit, restrict or impair the grant
by a Grantor of a security interest pursuant to this Agreement in any such
Collateral to the extent that an otherwise applicable prohibition or restriction
on such grant is rendered ineffective by any applicable law, including the UCC,
(G) any license, permit, franchise, authorization, consent, registration or
other approval issued by the Federal Communications Commission (or any
equivalent state agency) (collectively, the “FCC Licenses”) held by any Grantor
to the extent that any requirement of law applicable thereto prohibits the
creation of a Lien thereon, but only to the extent, and for so long as, such
prohibition is not terminated or rendered unenforceable or otherwise deemed
ineffective by any applicable law, including the UCC, (H) Margin Stock unless
the applicable requirements of Regulations T, U and X of the Board of Governors
of the Federal Reserve have been satisfied, (I) any asset with respect to which
the Company and the Senior Credit Facilities Agent have determined, in writing,
confirmed in a notice delivered to the Collateral Agent by the Company, where
the costs, burden or other consequences (including any mortgage, stamp,
intangibles, or other similar tax, titles insurance or similar items) of
obtaining or perfecting a security interest in such assets is excessive in view
of the benefits afforded thereby or (J) those assets that would constitute
Collateral but as to which the Senior Credit Facilities Agent shall not have
required a Lien or a security interest for so long as the Obligations under the
Senior Credit Facilities are outstanding.

(b) Each Grantor hereby irrevocably authorizes the Collateral Agent for the
benefit of the Secured Parties at any time and from time to time to file in any
relevant jurisdiction any initial financing statements (including fixture
filings) with respect to the Article 9 Collateral or any part thereof and
amendments thereto that (i) indicate the Collateral as all assets of such
Grantor or words of similar effect as being of an equal or lesser scope or with
greater detail and (ii) contain the information required by Article 9 of the
Uniform Commercial Code or the analogous legislation of each applicable
jurisdiction for the filing of any financing statement or amendment, including
(A) whether such Grantor is an organization, the type of organization and any
organizational identification number issued to such Grantor and (B) in the case
of a financing statement filed as a fixture filing, a sufficient description of
the real property to which such Article 9 Collateral relates. Each Grantor
agrees to provide such information to the Collateral Agent promptly upon
request.

(c) The Security Interest is granted as security only and shall not subject the
Collateral Agent or any other Secured Party to, or in any way alter or modify,
any obligation or liability of any Grantor with respect to or arising out of the
Article 9 Collateral.

SECTION 3.02. Representations and Warranties. Each Grantor jointly and severally
represents and warrants, as to itself and the other Grantors, to the Collateral
Agent and the Secured Parties that:

(a) Subject to Liens permitted by Section 4.12 of the Indenture, each Grantor
has good and valid rights in and title to the Article 9 Collateral with respect
to which it

 

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has purported to grant a Security Interest hereunder and has full power and
authority to grant to the Collateral Agent the Security Interest in such Article
9 Collateral pursuant hereto and to execute, deliver and perform its obligations
in accordance with the terms of this Agreement.

(b) The Perfection Certificate has been duly prepared, completed and executed
and the information set forth therein is correct and complete in all material
respects (except the information therein with respect to the exact legal name of
each Grantor shall be correct and complete in all respects) as of the Issue
Date. The Uniform Commercial Code financing statements (including fixture
filings, as applicable) or other appropriate filings, recordings or
registrations based upon the information in the Perfection Certificate for
filing in each governmental, municipal or other office specified in Schedule 2
to the Perfection Certificate (or specified by notice from the Company to the
Collateral Agent after the Issue Date), are all the filings, recordings and
registrations that are necessary to establish a legal, valid and perfected
security interest in favor of the Collateral Agent (for the benefit of the
Secured Parties) in respect of all Article 9 Collateral in which the Security
Interest may be perfected by filing, recording or registration in the United
States (or any political subdivision thereof) and its territories and
possessions, and no further or subsequent filing, refiling, recording,
rerecording, registration or reregistration is necessary in any such
jurisdiction, except as provided under applicable law with respect to the filing
of continuation statements.

(c) The Security Interest constitutes (i) a legal and valid security interest in
all the Article 9 Collateral securing the payment and performance of the Secured
Obligations and (ii) subject to the filings described in Section 3.02(b) hereof,
a perfected security interest in all Article 9 Collateral in which a security
interest may be perfected by filing, recording or registering a financing
statement or analogous document in the United States (or any political
subdivision thereof) and its territories and possessions pursuant to the Uniform
Commercial Code. The Security Interest is and shall be prior to any other Lien
on any of the Article 9 Collateral, other than (i) any Lien that is expressly
permitted pursuant to Section 4.12 of the Indenture and has priority as a matter
of law and (ii) Liens expressly permitted pursuant to Section 4.12 of the
Indenture.

(d) The Article 9 Collateral is owned by the Grantors free and clear of any
Lien, except for Liens expressly permitted pursuant to Section 4.12 of the
Indenture. None of the Grantors has filed or consented to the filing of (i) any
financing statement or analogous document under the Uniform Commercial Code or
any other applicable laws covering any Article 9 Collateral or (ii) any
assignment in which any Grantor assigns any Article 9 Collateral or any security
agreement or similar instrument covering any Article 9 Collateral with any
foreign governmental, municipal or other office, which financing statement or
analogous document, assignment, security agreement or similar instrument is
still in effect, except, in each case, for Liens expressly permitted pursuant to
Section 4.12 of the Indenture.

 

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(e) The only Commercial Tort Claims of any Grantor existing on the Issue Date in
excess of $5,000,000 are those listed on Schedule III which sets forth such
information separately for each Grantor.

SECTION 3.03. Covenants. (a) The Company agrees to notify the Collateral Agent
in writing promptly, but in any event within ten (10) Business Days, after any
change (i) in the legal name of any Grantor, (ii) in the identity or type of
organization or corporate structure of any Grantor or (iii) in the jurisdiction
of organization of any Grantor and take all actions, including the filing of UCC
financing statement amendments, required to continue the perfection of the
Collateral Agent’s security interest in the Collateral of such Grantor at all
times following such change.

(b) Each Grantor shall, at its own expense, take any and all commercially
reasonable actions necessary to defend title to the Article 9 Collateral against
all Persons and to defend the Security Interest of the Collateral Agent in the
Article 9 Collateral and the priority thereof against any Lien not expressly
permitted pursuant to Section 4.12 of the Indenture; provided that, nothing in
this Agreement shall prevent any Grantor from discontinuing the operation or
maintenance of any of its assets or properties if such discontinuance is
(x) determined by such Grantor to be desirable in the conduct of its business
and (y) permitted by the Indenture.

(c) Each year, at the time of delivery of annual financial statements with
respect to the preceding fiscal year pursuant to Section 4.03 of the Indenture,
the Company shall deliver to the Collateral Agent a certificate executed by the
Company setting forth the information required pursuant to Schedules 1(a), 1(c),
1(e), 1(f) and 2(b) of the Perfection Certificate or confirming that there has
been no change in such information since the date of such certificate or the
date of the most recent certificate delivered pursuant to this Section 3.03(c).

(d) Each Grantor agrees, on its own behalf and on behalf of each other Grantor,
at its own expense, to execute, acknowledge, deliver and cause to be duly filed
all such further instruments and documents and take all such actions necessary
or as the Collateral Agent (acting at the direction of a majority of Holders)
may from time to time reasonably request to better assure, preserve, protect and
perfect the Security Interest and the rights and remedies created hereby,
including the payment of any fees and taxes required in connection with the
execution and delivery of this Agreement, the granting of the Security Interest
and the filing of any financing statements (including fixture filings) or other
documents in connection herewith or therewith. If any amount payable under or in
connection with any of the Article 9 Collateral that is in excess of $5,000,000
shall be or become evidenced by any promissory note or other instrument, subject
to Section 2.09 of the Pari Passu Intercreditor Agreement, such note or
instrument shall be promptly pledged and delivered to the Collateral Agent, for
the benefit of the Secured Parties, duly endorsed.

(e) At its option, subject to the Pari Passu Intercreditor Agreement, the
Collateral Agent (acting at the written direction of a majority of Holders) may
discharge past due taxes, assessments, charges, fees, Liens, security interests
or other

 

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encumbrances at any time levied or placed on the Article 9 Collateral and not
permitted pursuant to Section 4.12 of the Indenture, and may pay for the
maintenance and preservation of the Article 9 Collateral to the extent any
Grantor fails to do so as required by the Indenture or this Agreement and within
a reasonable period of time after the Collateral Agent has requested that it do
so, and each Grantor jointly and severally agrees to reimburse the Collateral
Agent within ten (10) days after demand for any payment made or any reasonable
expense incurred by the Collateral Agent pursuant to the foregoing
authorization. Nothing in this paragraph shall be interpreted as excusing any
Grantor from the performance of, or imposing any obligation on the Collateral
Agent or any Secured Party to cure or perform, any covenants or other promises
of any Grantor with respect to taxes, assessments, charges, fees, Liens,
security interests or other encumbrances and maintenance as set forth herein or
in the other Notes Documents.

(f) If at any time any Grantor shall take a security interest in any property of
an Account Debtor or any other Person the value of which is in excess of
$5,000,000 to secure payment and performance of an Account, such Grantor shall
promptly assign such security interest to the Collateral Agent for the benefit
of the Secured Parties. Such assignment need not be filed of public record
unless necessary to continue the perfected status of the security interest
against creditors of and transferees from the Account Debtor or other Person
granting the security interest.

(g) Each Grantor (rather than the Collateral Agent or any Secured Party) shall
remain liable (as between itself and any relevant counterparty) to observe and
perform all the conditions and obligations to be observed and performed by it
under each contract, agreement or instrument relating to the Article 9
Collateral, all in accordance with the terms and conditions thereof, and each
Grantor jointly and severally agrees to indemnify and hold harmless the
Collateral Agent and the Secured Parties from and against any and all liability
for such performance.

SECTION 3.04. Other Actions. In order to further insure the attachment,
perfection and priority of, and the ability of the Collateral Agent to enforce,
the Security Interest, each Grantor agrees, in each case at such Grantor’s own
expense, to take the following actions with respect to the following Article 9
Collateral:

(a) Instruments. If any Grantor shall at any time hold or acquire any
Instruments constituting Collateral and evidencing an amount in excess of
$5,000,000, such Grantor shall forthwith, subject to Section 2.09 of the Parri
Passu Intercreditor Agreement, endorse, assign and deliver the same to the
Collateral Agent for the benefit of the Secured Parties, accompanied by such
instruments of transfer or assignment duly executed in blank.

(b) Investment Property. Except to the extent otherwise provided in Article II
hereof, if any Grantor shall at any time hold or acquire any certificated
securities that constitute Collateral, such Grantor shall forthwith, subject to
Section 2.09 of the Parri Passu Intercreditor Agreement, endorse, assign and
deliver the same to the Collateral Agent for the benefit of the Secured Parties,
accompanied by such instruments of transfer or assignment duly executed in
blank.

 

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(c) Commercial Tort Claims. If any Grantor shall at any time commence a suit,
action or proceeding with respect to any Commercial Tort Claim held by it with a
value which such Grantor reasonably believes to be of $5,000,000 or more, such
Grantor shall, within forty-five (45) days after the end of the fiscal quarter
in which such complaint was filed, notify the Collateral Agent thereof in a
writing signed by such Grantor and describing the details thereof and shall
grant to the Collateral Agent for the benefit of the Secured Parties in such
writing a security interest therein and in the proceeds thereof, all upon the
terms of this Agreement.

SECTION 3.05. Post-Closing Actions. Within 10 Business Days (or such later date
acceptable to the Senior Credit Facilities Agent in its sole discretion) after
receipt by the Company of a “Lost Stock Affidavit” executed by the Senior Credit
Facilities Agent, the Company shall deliver to the Senior Credit Facilities
Agent all original certificated Equity Interests (as defined in the Existing
Senior Credit Facilities) required to be delivered to the Senior Credit
Facilities Agent pursuant to the provisions of the Existing Senior Credit
Facilities, together with transfer powers duly executed in blank; provided that
the Company shall deliver a list of all original certificated Equity Interests
it has delivered to the Administrative Agent prior to the date hereof within 10
Business Days after the Issue Date. For the avoidance of doubt, this
Section 3.05 shall in no event alter or modify the Company’s obligations under
Section 6.11 of the Existing Senior Credit Facilities with respect to any new
direct or indirect wholly owned Domestic Restricted Subsidiary (as defined
therein).

ARTICLE IV

Remedies

SECTION 4.01. Remedies Upon Default. Subject to the terms of the Pari Passu
Intercreditor Agreement, upon the occurrence and during the continuance of an
Event of Default, it is agreed that the Collateral Agent shall have the right to
exercise any and all rights afforded to a secured party with respect to the
Secured Obligations under the Uniform Commercial Code or other applicable law
and also may (i) require each Grantor to, and each Grantor agrees that it will
at its expense and upon request of the Collateral Agent forthwith, assemble all
or part of the Collateral as directed by the Collateral Agent and make it
available to the Collateral Agent at a place and time to be designated by the
Collateral Agent that is reasonably convenient to both parties; (ii) occupy any
premises owned or, to the extent lawful and permitted, leased by any of the
Grantors where the Collateral or any part thereof is assembled or located for a
reasonable period in order to effectuate its rights and remedies hereunder or
under law, without obligation to such Grantor in respect of such occupation;
provided that the Collateral Agent shall provide the applicable Grantor with
notice thereof prior to or promptly after such occupancy; (iii) exercise any and
all rights and remedies of any of the Grantors under or in connection with the
Collateral, or otherwise in respect of the Collateral; provided that the
Collateral Agent shall provide the applicable Grantor with notice thereof prior
to or promptly after such exercise; and (iv) subject to the mandatory
requirements of applicable law and the notice requirements described below, sell
or otherwise dispose of all or any part of the Collateral securing the Secured
Obligations at a

 

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

The Collateral Agent shall give the applicable Grantors ten (10) days’ written
notice (which each Grantor agrees is reasonable notice within the meaning of
Section 9-611 of the New York UCC or its equivalent in other jurisdictions) of
the Collateral Agent’s intention to make any sale of Collateral. Such notice, in
the case of a public sale, shall state the time and place for such sale and, in
the case of a sale at a broker’s board or on a securities exchange, shall state
the board or exchange at which such sale is to be made and the day on which the
Collateral, or portion thereof, will first be offered for sale at such board or
exchange. Any such public sale shall be held at such time or times within
ordinary business hours and at such place or places as the Collateral Agent may
fix and state in the notice (if any) of such sale. At any such sale, the
Collateral, or portion thereof, to be sold may be sold in one lot as an entirety
or in separate parcels, as the Collateral Agent may determine. The Collateral
Agent shall not be obligated to make any sale of any Collateral if it shall
determine not to do so, regardless of the fact that notice of sale of such
Collateral shall have been given. The Collateral Agent may, without notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for
sale, and such sale may, without further notice, be made at the time and place
to which the same was so adjourned. In case any sale of all or any part of the
Collateral is made on credit or for future delivery, the Collateral so sold may
be retained by the Collateral Agent until the sale price is paid by the
purchaser or purchasers thereof, but the Collateral Agent shall not incur any
liability in case any such purchaser or purchasers shall fail to take up and pay
for the Collateral so sold and, in case of any such failure, such Collateral may
be sold again upon like notice. At any public (or, to the extent permitted by
law, private) sale made pursuant to this Agreement, any Secured Party may bid
for or purchase, free (to the extent permitted by law) from any right of
redemption, stay, valuation or appraisal on the part of any Grantor (all said
rights being also hereby waived and released to the extent permitted by law),
the Collateral or any part thereof offered for sale and may make payment on
account thereof by using any claim then due and payable to such Secured Party
from any Grantor as a credit against the purchase price, and such Secured Party
may, upon compliance with the terms of sale, hold, retain and dispose of such
property without further accountability to any Grantor therefor. For purposes
hereof, a written agreement to purchase the Collateral or any portion thereof
shall be treated as a sale thereof; the Collateral Agent shall be free to carry
out such sale pursuant to such agreement and no Grantor shall be entitled to the
return of the Collateral or any portion thereof subject thereto, notwithstanding
the fact that after the Collateral Agent shall have entered into such an
agreement all Events of Default shall have been remedied and the Secured
Obligations paid in full. As an alternative to exercising the power of sale
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conferred upon it, the Collateral Agent may proceed by a suit or suits at law or
in equity to foreclose this Agreement and to sell the Collateral or any portion
thereof pursuant to a judgment or decree of a court or courts having competent
jurisdiction or pursuant to a proceeding by a court-appointed receiver. Any sale
pursuant to the provisions of this Section 4.01 shall be deemed to conform to
the commercially reasonable standards as provided in Section 9-610(b) of the New
York UCC or its equivalent in other jurisdictions.

Each Grantor irrevocably makes, constitutes and appoints the Collateral Agent
(and all officers, employees or agents designated by the Collateral Agent) as
such Grantor’s true and lawful agent (and attorney-in-fact) during the
continuance of an Event of Default and after notice to the Company of its intent
to exercise such rights, for the purpose of (i) making, settling and adjusting
claims in respect of Article 9 Collateral under policies of insurance, endorsing
the name of such Grantor on any check, draft, instrument or other item of
payment for the proceeds of such policies if insurance, (ii) making all
determinations and decisions with respect thereto and (iii) obtaining or
maintaining the policies of insurance required by Section 11.02 of the Indenture
or to pay any premium in whole or in part relating thereto. All sums disbursed
by the Collateral Agent in connection with this paragraph, including reasonable
attorneys’ fees, court costs, expenses and other charges relating thereto, shall
be payable, within 10 days of demand, by the Grantors to the Collateral Agent
and shall be additional Secured Obligations secured hereby.

SECTION 4.02. Application of Proceeds. Subject to the Pari Passu Intercreditor
Agreement, the Collateral Agent shall apply the proceeds of any collection or
sale of Collateral, including any Collateral consisting of cash, in accordance
with the Indenture.

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

ARTICLE V

Indemnity, Subrogation and Subordination

SECTION 5.01. Indemnity. In addition to all rights of indemnity and subrogation
as the Grantors may have under applicable law (but subject to Section 5.03
hereof), the Company agrees that, in the event any assets of any Grantor (other
than the Company) shall be sold pursuant to this Agreement or any other Security
Document to satisfy in whole or in part an Obligation owed to any Secured Party,
the Company shall indemnify such Grantor in an amount equal to the greater of
the book value or the fair market value of the assets so sold.

SECTION 5.02. Contribution and Subrogation. Each Subsidiary Party (a
“Contributing Party”) agrees (subject to Section 5.03 hereof) that, in the event
assets of any

 

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other Subsidiary Party shall be sold pursuant to any Security Document to
satisfy any Secured Obligation owed to any Secured Party and such other
Subsidiary Party (the “Claiming Party”) shall not have been fully indemnified by
the Company as provided in Section 5.01 hereof, the Contributing Party shall
indemnify the Claiming Party in an amount equal to the greater of the book value
or the fair market value of such assets, in each case multiplied by a fraction
of which the numerator shall be the net worth of the Contributing Party on the
date hereof and the denominator shall be the aggregate net worth of all the
Contributing Parties together with the net worth of the Claiming Party on the
date hereof (or, in the case of any Grantor becoming a party hereto pursuant to
Section 6.14 hereof, the date of the Security Agreement Supplement hereto
executed and delivered by such Grantor). Any Contributing Party making any
payment to a Claiming Party pursuant to this Section 5.02 shall be subrogated to
the rights of such Claiming Party to the extent of such payment.

SECTION 5.03. Subordination. (a) Notwithstanding any provision of this Agreement
to the contrary, all rights of the Grantors under Sections 5.01 and 5.02 hereof
and all other rights of indemnity, contribution or subrogation under applicable
law or otherwise shall be fully subordinated to the indefeasible payment in full
in cash of the Secured Obligations. No failure on the part of the Grantors to
make the payments required by Sections 5.01 and 5.02 hereof (or any other
payments required under applicable law or otherwise) shall in any respect limit
the obligations and liabilities of any Grantor with respect to its obligations
hereunder, and each Grantor shall remain liable for the full amount of the
obligations of such Grantor hereunder.

(b) Each Grantor hereby agrees that upon the occurrence and during the
continuance of an Event of Default and after notice from the Collateral Agent
(which notice states that it is delivered pursuant to this Section 5.03(b)), all
Indebtedness owed by it to any Subsidiary that is not a Grantor shall be fully
subordinated to the indefeasible payment in full in cash of the Secured
Obligations.

ARTICLE VI

Miscellaneous

SECTION 6.01. Notices. All communications and notices hereunder shall (except as
otherwise expressly permitted herein) be in writing and given as provided in
Section 13.02 of the Indenture. All communications and notices hereunder to any
Grantor shall be given to it in care of the Company as provided in Section 13.02
of the Indenture.

SECTION 6.02. Waivers, Amendment. (a) No failure or delay by the Collateral
Agent in exercising any right or power hereunder or under any other Notes
Document shall operate as a waiver thereof, nor shall any single or partial
exercise of any such right or power, or any abandonment or discontinuance of
steps to enforce such a right or power, preclude any other or further exercise
thereof or the exercise of any other right or power. The rights and remedies of
the Collateral Agent and under the other Notes Documents are cumulative and are
not exclusive of any rights or remedies that they would otherwise have. No
waiver of any provision of this Agreement or consent to any departure by any
Grantor therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) of this Section 6.02, and then such waiver or consent
shall be effective only in the specific instance and for the purpose for which
given. No notice or demand on any Grantor in any case shall entitle any Grantor
to any other or further notice or demand in similar or other circumstances.

 

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(b) Neither this Agreement nor any provision hereof may be waived, amended or
modified except pursuant to an agreement or agreements in writing entered into
by the Collateral Agent and the Grantor or Grantors with respect to which such
waiver, amendment or modification is to apply, subject to any consent required
in accordance with Section 9.02 of the Indenture.

SECTION 6.03. Collateral Agent’s Fees and Expenses; Indemnification. (a) The
parties hereto agree that the Collateral Agent shall be reimbursed of its
reasonable out-of-pocket expenses incurred hereunder as provided in the
Indenture.

(b) Without limitation of its indemnification obligations under the other Notes
Documents, each Grantor agrees to indemnify and hold harmless the Collateral
Agent in accordance with Section 7.07 of the Indenture.

(c) Any such amounts payable as provided hereunder shall be additional Secured
Obligations secured hereby and by the other Security Documents. The provisions
of this Section 6.03 shall remain operative and in full force and effect
regardless of the termination of this Agreement or any other Notes Document, the
consummation of the transactions contemplated hereby, the repayment of any of
the Secured Obligations, the invalidity or unenforceability of any term or
provision of this Agreement or any other Notes Document, or any investigation
made by or on behalf of the Collateral Agent or any other Secured Party. All
amounts due under this Section 6.03 shall be payable within 10 days of written
demand therefor.

SECTION 6.04. Successors and Assigns. Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the
permitted successors and assigns of such party; and all covenants, promises and
agreements by or on behalf of any Grantor or the Collateral Agent that are
contained in this Agreement shall bind and inure to the benefit of their
respective successors and assigns.

SECTION 6.05. Survival of Agreement. All covenants, agreements, representations
and warranties made by the Grantors hereunder and in the other Notes Documents
and in the certificates or other instruments prepared or delivered in connection
with or pursuant to this Agreement or any other Notes Document shall be
considered to have been relied upon by the Holders and shall survive the
execution and delivery of the Notes Documents, regardless of any investigation
made by any Holder or on its behalf and notwithstanding that the Collateral
Agent may have had notice or knowledge of any Default or incorrect
representation or warranty, and shall continue in full force and effect as long
as the principal of or any accrued interest on any Note or any fee or any other
amount payable under any Notes Document is outstanding and unpaid (other than
contingent indemnification obligations to the extent not asserted).

SECTION 6.06. Counterparts; Effectiveness; Several Agreement. This Agreement may
be executed in one or more counterparts, each of which shall be deemed an

 

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original, but all of which together shall constitute one and the same
instrument. Delivery by telecopier of an executed counterpart of a signature
page to this Agreement shall be effective as delivery of an original executed
counterpart of this Agreement. This Agreement shall become effective as to any
Grantor when a counterpart hereof executed on behalf of such Grantor shall have
been delivered to the Collateral Agent and a counterpart hereof shall have been
executed on behalf of the Collateral Agent, and thereafter shall be binding upon
such Grantor and the Collateral Agent and their respective permitted successors
and assigns, and shall inure to the benefit of such Grantor, the Collateral
Agent and the other Secured Parties and their respective successors and assigns,
except that no Grantor shall have the right to assign or transfer its rights or
obligations hereunder or any interest herein or in the Collateral (and any such
assignment or transfer shall be void) except as expressly contemplated by this
Agreement or the Indenture. This Agreement shall be construed as a separate
agreement with respect to each Grantor and may be amended, modified,
supplemented, waived or released with respect to any Grantor without the
approval of any other Grantor and without affecting the obligations of any other
Grantor hereunder.

SECTION 6.07. Severability. If any provision of this Agreement is held to be
illegal, invalid or unenforceable, the legality, validity and enforceability of
the remaining provisions of this Agreement shall not be affected or impaired
thereby. The invalidity of a provision in a particular jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction. The
parties shall endeavor in good-faith negotiations to replace the invalid,
illegal or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the invalid, illegal or
unenforceable provisions.

SECTION 6.08. [Reserved].

SECTION 6.09. GOVERNING LAW. (a) THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.

(b) ANY LEGAL ACTION OR PROCEEDING ARISING UNDER ANY NOTES DOCUMENT OR IN ANY
WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES
HERETO OR ANY OF THEM WITH RESPECT TO ANY NOTES DOCUMENT, OR THE TRANSACTIONS
RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, MAY BE
BROUGHT IN THE COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK CITY OR OF
THE UNITED STATES FOR THE SOUTHERN DISTRICT OF SUCH STATE, AND BY EXECUTION AND
DELIVERY OF THIS AGREEMENT, EACH GRANTOR CONSENTS, FOR ITSELF AND IN RESPECT OF
ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH GRANTOR
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE
OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT
OF ANY NOTES DOCUMENT OR OTHER DOCUMENT RELATED THERETO.

 

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SECTION 6.10. WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY TO THIS AGREEMENT
HEREBY EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION
OR CAUSE OF ACTION ARISING UNDER ANY NOTES DOCUMENT OR IN ANY WAY CONNECTED WITH
OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM
WITH RESPECT TO ANY NOTES DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH
CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT
OR TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION 6.10 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF
THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

SECTION 6.11. Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and are not to affect the construction of, or to be taken into
consideration in interpreting, this Agreement.

SECTION 6.12. Security Interest Absolute. All rights of the Collateral Agent
hereunder, the Security Interest, the grant of a security interest in the
Pledged Collateral and all obligations of each Grantor hereunder shall be
absolute and unconditional irrespective of (a) any lack of validity or
enforceability of the Indenture, any other Notes Document, any agreement with
respect to any of the Secured Obligations or any other agreement or instrument
relating to any of the foregoing, (b) any change in the time, manner or place of
payment of, or in any other term of, all or any of the Secured Obligations, or
any other amendment or waiver of or any consent to any departure from the
Indenture, any other Notes Document or any other agreement or instrument,
(c) any exchange, release or non-perfection of any Lien on other collateral, or
any release or amendment or waiver of or consent under or departure from any
guarantee, securing or guaranteeing all or any of the Secured Obligations or
(d) any other circumstance that might otherwise constitute a defense available
to, or a discharge of, any Grantor in respect of the Secured Obligations or this
Agreement.

SECTION 6.13. Termination or Release.

(a) This Agreement, the Security Interest and all other security interests
granted hereby shall terminate with respect to all Secured Obligations when all
the outstanding Secured Obligations under the Notes Documents (other than
contingent indemnification obligations to the extent not asserted) have been
paid in full.

(b) A Subsidiary Party shall automatically be released from its obligations
hereunder and the Security Interest in the Collateral of such Subsidiary Party
shall be automatically released upon the release of a Subsidiary Party from its
Guarantee in accordance with the provisions of the Indenture; provided that such
portion of the Holders as shall be required by the terms of the Indenture to
have consented to such transaction (to the extent such consent is required by
the Indenture) shall have consented thereto and the terms of such consent did
not provide otherwise.

 

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(c) Upon any sale or other transfer by any Grantor of any Collateral (other than
to another Grantor) that is permitted under Section 4.10 of the Indenture and
the Security Documents, or upon the effectiveness of any written consent to the
release of the security interest granted hereby in any Collateral pursuant to
the Indenture, the security interest in such Collateral shall be automatically
released; provided, that such portion of the Holders as shall be required by the
terms of the Indenture to have consented to such transaction (to the extent such
consent is required by the Indenture) shall have consented thereto and the terms
of such consent did not provide otherwise.

(d) In connection with any termination or release pursuant to paragraph (a),
(b) or (c), the Collateral Agent shall execute and deliver to any Grantor, at
such Grantor’s expense, all documents that such Grantor shall reasonably request
to evidence such termination or release and shall perform such other actions
reasonably requested by such Grantor to effect such release, including delivery
of certificates, securities and instruments. Any execution and delivery of
documents pursuant to this Section 6.13 or pursuant to the Indenture shall be
without recourse to or warranty by the Collateral Agent.

SECTION 6.14. Intercreditor Agreements Govern. Notwithstanding anything herein
to the contrary, the lien and security interest granted to the Collateral Agent,
for the benefit of the Secured Parties, pursuant to this Agreement and the
exercise of any right or remedy by the Collateral Agent and the other Secured
Parties hereunder are subject to the provisions of the Intercreditor Agreements.
In the event of any conflict or inconsistency between a provision of the Pari
Passu Intercreditor Agreement and this Agreement that relates solely to the
rights or obligations of, or relationships between, the Secured Parties and any
other First Lien Secured Parties (as such term is defined in the Pari Passu
Intercreditor Agreement), the provisions of the Pari Passu Intercreditor
Agreement shall control. So long as the Pari Passu Intercreditor Agreement is in
effect, any requirement in this Agreement to deliver any Collateral to the
Collateral Agent shall be satisfied by delivery of Collateral to the Applicable
Authorized Representative (as defined in the Pari Passu Intercreditor
Agreement). In the event of a conflict between the Pari Passu Intercreditor
Agreement and the other Intercreditor Agreements, the Pari Passu Intercreditor
Agreement shall control as between the holders of the First Lien Obligation
thereunder and holders of indebtedness governed by the other Intercreditor
Agreements.

SECTION 6.15. Additional Grantors. Each Restricted Subsidiary of the Company
that is required to enter into this Agreement pursuant to Section 4.15 of the
Indenture shall, upon execution and delivery by the Collateral Agent and such
Restricted Subsidiary of a Security Agreement Supplement, become a Grantor
hereunder with the same force and effect as if originally named as a Grantor
herein. The execution and delivery of any such instrument shall not require the
consent of any other Grantor hereunder. The rights and obligations of each
Grantor hereunder shall remain in full force and effect notwithstanding the
addition of any new Grantor as a party to this Agreement.

 

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SECTION 6.16. Collateral Agent Appointed Attorney-in-Fact. Each Grantor hereby
appoints the Collateral Agent the attorney-in-fact of such Grantor for the
purpose of carrying out the provisions of this Agreement and taking any action
and executing any instrument that may be necessary or advisable to accomplish
the purposes hereof at any time after and during the continuance of an Event of
Default, which appointment is irrevocable and coupled with an interest. Without
limiting the generality of the foregoing, the Collateral Agent shall have the
right, upon the occurrence and during the continuance of an Event of Default and
notice by the Collateral Agent to the Company of its intent to exercise such
rights, with full power of substitution either in the Collateral Agent’s name or
in the name of such Grantor (a) to receive, endorse, assign and/or deliver any
and all notes, acceptances, checks, drafts, money orders or other evidences of
payment relating to the Collateral or any part thereof; (b) to demand, collect,
receive payment of, give receipt for and give discharges and releases of all or
any of the Collateral; (c) to sign the name of any Grantor on any invoice or
bill of lading relating to any of the Collateral; (d) to send verifications of
Accounts to any Account Debtor; (e) to commence and prosecute any and all suits,
actions or proceedings at law or in equity in any court of competent
jurisdiction to collect or otherwise realize on all or any of the Collateral or
to enforce any rights in respect of any Collateral; (f) to settle, compromise,
compound, adjust or defend any actions, suits or proceedings relating to all or
any of the Collateral; (g) to notify, or to require any Grantor to notify,
Account Debtors to make payment directly to the Collateral Agent; (h) to use,
sell, assign, transfer, pledge, make any agreement with respect to or otherwise
deal with all or any of the Collateral, and to do all other acts and things
necessary to carry out the purposes of this Agreement, as fully and completely
as though the Collateral Agent were the absolute owner of the Collateral for all
purposes and (i) to make, settle and adjust claims in respect of Article 9
Collateral under policies of insurance, endorsing the name of such Grantor on
any check, draft, instrument or other item of payment for the proceeds of such
policies and to make all determinations and decisions with respect thereto;
provided that nothing herein contained shall be construed as requiring or
obligating the Collateral Agent to make any commitment or to make any inquiry as
to the nature or sufficiency of any payment received by the Collateral Agent, or
to present or file any claim or notice, or to take any action with respect to
the Collateral or any part thereof or the moneys due or to become due in respect
thereof or any property covered thereby. The Collateral Agent and the other
Secured Parties shall be indemnified in accordance with the provisions of the
Indenture.

SECTION 6.17. General Authority of the Collateral Agent. Each Secured Party
(whether or not a signatory hereto) shall be deemed irrevocably (a) to consent
to the appointment of the Collateral Agent as its agent hereunder and under such
other Security Documents, (b) to confirm that the Collateral Agent shall have
the authority to act as the exclusive agent of such Secured Party for the
enforcement of any provisions of this Agreement and such other Security
Documents against any Grantor, the exercise of remedies hereunder or thereunder
and the giving or withholding of any consent or approval hereunder or thereunder
relating to any Collateral or any Grantor’s obligations with respect thereto,
(c) to agree that it shall not take any action to enforce any provisions of this
Agreement or any other Security Document against any Grantor, to exercise any
remedy hereunder or thereunder or to give any consents or approvals hereunder or
thereunder except as expressly provided in this Agreement or any other Security
Document and (d) to agree to be bound by the terms of this Agreement and any
other Security Documents.

 

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SECTION 6.18. Rights of Collateral Agent in Respect of Collateral. In acting
under this Agreement, the Collateral Agent is entitled to all rights,
privileges, protections, immunities, benefits and indemnities provided to it
under the Indenture. As of the Issue Date, the Collateral Agent holds no
Collateral in its possession.

SECTION 6.19. FCC Licenses. Each Grantor agrees that, upon the occurrence and
during the continuance of an Event of Default and at the Collateral Agent
request (acting at the written direction of a majority of the Holders), such
Grantor will promptly file, or cause to be filed, such applications for approval
with the Federal Communications Commission (or any equivalent state agency) and
shall take such other actions as are necessary for the assignment or transfer of
control of the FCC Licenses.

 

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

 

WEST CORPORATION By:  

/s/ Jan D. Madsen

Name:   Jan D. Madsen Title:   Chief Financial Officer and Treasurer CLIENTTELL,
INC. CORPORATE CARE WORKS, INC. HEALTH ADVOCATE, INC. HUMAN MANAGEMENT SERVICES,
INC. NORTHERN CONTACT, INC. RELIANCE HOLDING, INC. RELIANCE INTERMEDIATE, INC.
RX ADVOCATE, INC. TWENTY FIRST CENTURY COMMUNICATIONS OF CANADA, INC. WELLCALL,
INC. WEST COMMAND SYSTEMS, INC. WEST INTERACTIVE CORPORATION WEST INTERACTIVE
SERVICES CORPORATION WEST IP COMMUNICATIONS, INC. WEST RECEIVABLE SERVICES, INC.
WEST SAFETY COMMUNICATIONS OF VIRGINIA INC. WEST SAFETY SERVICES, INC. WEST
SAFETY SOLUTIONS CORP. WEST UNIFIED COMMUNICATIONS SERVICES, INC. By:  

/s/ Jan D. Madsen

Name:   Jan D. Madsen Title:   Chief Financial Officer and Treasurer ANNEX
HOLDINGS HC, LLC By: Rubik Acquisition Company, LLC, its Member By: West
Corporation, its Member By:  

/s/ Jan D. Madsen

Name:   Jan D. Madsen Title:   Chief Financial Officer and Treasurer

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CLIENTTELL LAB, LLC By: ClientTell, Inc., its Member By:  

/s/ Jan D. Madsen

Name:   Jan D. Madsen Title:   Chief Financial Officer and Treasurer RELIANCE
COMMUNICATIONS, LLC By: Reliance Intermediate, Inc., its Member By:  

/s/ Jan D. Madsen

Name:   Jan D. Madsen Title:   Chief Financial Officer and Treasurer RUBIK
ACQUISITION COMPANY, LLC WEST FACILITIES, LLC WEST REVENUE GENERATION SERVICES,
LLC By: Reliance Intermediate, Inc., its Member By:  

/s/ Jan D. Madsen

Name:   Jan D. Madsen Title:   Chief Financial Officer and Treasurer WEST CLAIMS
RECOVERY SERVICES, LLC By: Reliance Intermediate, Inc., its Member By:  

/s/ Jan D. Madsen

Name:   Jan D. Madsen Title:   Chief Financial Officer and Treasurer WEST
TELECOM SERVICES HOLDINGS, LLC By Rubik Acquisition Company, LLC, its Member By
West Corporation, its Member By:  

/s/ Jan D. Madsen

Name:   Jan D. Madsen Title:   Chief Financial Officer and Treasurer

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By Annex Holdings HC, LLC, its Member By Rubik Acquisition Company, LLC, its
Member By West Corporation, its Member By:  

/s/ Jan D. Madsen

Name:   Jan D. Madsen Title:   Chief Financial Officer and Treasurer

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U.S. BANK NATIONAL ASSOCIATION, as Collateral Agent By:  

/s/ Richard Prokosch

Name:   Richard Prokosch Title:   Vice President