Unassociated Document


    Exhibit
10.16

     

    EXECUTION
VERSION

     

    
      
        

      

    

     

    GUARANTEE
AND COLLATERAL AGREEMENT

     

    dated as
of

     

    April 28,
2009,

     

    among

     

    WOLVERINE
TUBE, INC.,

     

    THE
SUBSIDIARIES OF WOLVERINE TUBE, INC.

    IDENTIFIED
HEREIN

     

    and

     

    U.S. BANK
NATIONAL ASSOCIATION,

     

    as
Collateral Agent


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    TABLE OF
CONTENTS

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            	
                                    ARTICLE
      I

                                  
	 
      	 
      
	
                                    Definitions

                                  
	
                                    SECTION
      1.01. Indenture

                                  	
                                    5

                                  
	
                                    SECTION
      1.02. Other Defined Terms

                                  	
                                    5

                                  
	 
      	 
      
	
                                    ARTICLE
      II

                                  
	 
      	 
      
	
                                    Guarantee

                                  
	 
      	 
      
	
                                    SECTION
      2.01. Guarantee

                                  	
                                    10

                                  
	
                                    SECTION
      2.02. Guarantee of Payment

                                  	
                                    10

                                  
	
                                    SECTION
      2.03. No Limitations

                                  	
                                    10

                                  
	
                                    SECTION
      2.04. Reinstatement

                                  	
                                    11

                                  
	
                                    SECTION
      2.05. Agreement To Pay; Subrogation

                                  	
                                    11

                                  
	
                                    SECTION
      2.06. Information

                                  	
                                    12

                                  
	 
      	 
      
	
                                    ARTICLE
      III

                                  
	 
      	 
      
	
                                    Pledge
      of Securities

                                  
	 
      	 
      
	
                                    SECTION
      3.01. Pledge

                                  	
                                    12

                                  
	
                                    SECTION
      3.02. Delivery of the Pledged Collateral

                                  	
                                    13

                                  
	
                                    SECTION
      3.03. Representations, Warranties and Covenants

                                  	
                                    13

                                  
	
                                    SECTION
      3.04. Certification of Limited Liability Company and Limited Partnership
      Interests

                                  	
                                    14

                                  
	
                                    SECTION
      3.05. Registration in Nominee Name; Denominations

                                  	
                                    15

                                  
	
                                    SECTION
      3.06. Voting Rights; Dividends and Interest

                                  	
                                    15

                                  
	 
      	 
      
	
                                    ARTICLE
      IV

                                  
	 
      	 
      
	
                                    Security
      Interests in Personal Property

                                  
	 
      	 
      
	
                                    SECTION
      4.01. Security Interest

                                  	
                                    17

                                  
	
                                    SECTION
      4.02. Representations and Warranties

                                  	
                                    18

                                  
	
                                    SECTION
      4.03. Covenants

                                  	
                                    20

                                  
	
                                    SECTION
      4.04. Other Actions

                                  	
                                    23

                                  
	
                                    SECTION
      4.05. Covenants Regarding Patent, Trademark and Copyright
      Collateral

                                  	
                                    26

                                  


                          

                        

                      

                    

                  

                

              

            

          

        

      

    


    
      
         


      

      
        2

        
          

        

      

      
         


      

    

    


    
      
        
          
            
              
                
                  
                    
                      
                        	
                                ARTICLE
      V

                              
	 
      	 
      
	
                                Remedies

                              
	 
      	 
      
	
                                SECTION
      5.01. Remedies Upon Default

                              	
                                28

                              
	
                                SECTION
      5.02. Application of Proceeds

                              	
                                29

                              
	
                                SECTION
      5.03. Grant of License to Use Intellectual Property

                              	
                                30

                              
	
                                SECTION
      5.04. Securities Act

                              	
                                30

                              
	
                                SECTION
      5.05. Registration

                              	
                                31

                              
	
                                ARTICLE
      VI

                              
	 
      	 
      
	
                                Indemnity,
      Subrogation and Subordination

                              
	 
	
                                SECTION
      6.01. Indemnity and Subrogation

                              	
                                31

                              
	
                                SECTION
      6.02. Contribution and Subrogation

                              	
                                31

                              
	
                                SECTION
      6.03. Subordination

                              	
                                32

                              
	 
      	 
      
	
                                ARTICLE
      VII

                              
	 
      	 
      
	
                                Miscellaneous

                              
	 	 
      
	
                                SECTION
      7.01. Notices

                              	
                                32

                              
	
                                SECTION
      7.02. Waivers; Amendment

                              	
                                32

                              
	
                                SECTION
      7.03. Collateral Agent’s Fees and Expenses;
Indemnification

                              	
                                33

                              
	
                                SECTION
      7.04. Successors and Assigns

                              	
                                34

                              
	
                                SECTION
      7.05. Survival of Agreement

                              	
                                34

                              
	
                                SECTION
      7.06. Counterparts; Effectiveness; Several Agreement

                              	
                                34

                              
	
                                SECTION
      7.07. Severability

                              	
                                34

                              
	
                                SECTION
      7.08. Governing Law; Jurisdiction; Consent to Service of
      Process

                              	
                                35

                              
	
                                SECTION
      7.09. WAIVER OF JURY TRIAL

                              	
                                35

                              
	
                                SECTION
      7.10. Headings

                              	
                                36

                              
	
                                SECTION
      7.11. Security Interest Absolute

                              	
                                36

                              
	
                                SECTION
      7.12. Termination or Release

                              	
                                36

                              
	
                                SECTION
      7.13. Additional Subsidiaries

                              	
                                36

                              
	
                                SECTION
      7.14. Collateral Agent Appointed Attorney-in-Fact

                              	
                                37

                              
	
                                SECTION
      7.15. Entire Agreement

                              	
                                37

                              


                      

                    

                  

                

              

            

          

        

      

    


    
      
         


      

      
        3

        
          

        

      

      
         


      

    


    SCHEDULES:

     

    
      
        
          
            	
                    Schedule
      I

                  	
                    Subsidiary
      Parties

                  
	
                    Schedule
      II

                  	
                    Pledged
      Stock; Debt Securities

                  
	
                    Schedule
      III

                  	
                    Intellectual
      Property

                  
	
                    Schedule
      IV

                  	
                    Insurance
      Requirements

                  


          

        

      

    

    


    EXHIBITS:

     

    
      
        
          
            	
                    Exhibit I

                  	
                    ABA
      Model Form of Deposit Account Control Agreement

                  
	
                    Exhibit
      II

                  	
                    Form
      of Supplement

                  


          

        

      

    


    
      
         


      

      
        4

        
          

        

      

      
         


      

    


    Schedule
I to

    the
Guarantee and

    Collateral
Agreement

     

    GUARANTEE
AND COLLATERAL AGREEMENT (this “Agreement”), dated as
of April 28, 2009, among WOLVERINE TUBE, INC., a Delaware corporation (the
“Company”), the
subsidiaries of the Company identified herein (the “Subsidiaries” and,
each, a “Subsidiary”) and U.S.
BANK NATIONAL ASSOCIATION (“U.S. Bank”), as
Collateral Agent (in such capacity, the “Collateral
Agent”).

     

    Reference
is made to the Indenture, dated as of April __, 2009 (as amended, supplemented
or otherwise modified from time to time, the “Indenture”), among
the Company, the Subsidiaries and U.S. Bank as trustee and collateral
agent.  The Company has agreed to issue the Notes subject to the terms
and conditions set forth in the Indenture, including, among other things, the
execution and delivery of this Agreement.  The Subsidiary Parties (as
defined below) are affiliates of the Company, will derive substantial benefits
from the issuance of the Notes pursuant to the Indenture and are willing to
execute and deliver this Agreement in order to support the issuance of the
Notes.  Accordingly, the parties hereto agree 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.

     

    (a)  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.

     

    “Article 9
Collateral” has the meaning assigned to such term in
Section 4.01.

     

    “CFC Subsidiary” means
any Subsidiary that is a “controlled foreign corporation” within the meaning of
Section 957 of the Internal Revenue Code of 1986, as amended.

     

    “CFC” means a
controlled foreign corporation (as that term is defined in the Internal Revenue
Code of 1986, as amended).


    
      
         


      

      
        5

        
          

        

      

      
         


      

    


    “Collateral” means
Article 9 Collateral and Pledged Collateral.

    “Copyright License”
means any written agreement, now or hereafter in effect, granting any right to
any third party under any copyright now or hereafter owned by any Grantor or
that such Grantor otherwise has the right to license, or granting any right to
any Grantor under any copyright now or hereafter owned by any third party, and
all rights of such Grantor under any such agreement.

     

    “Copyrights” means all
of the following now owned or hereafter acquired by any
Grantor:  (a) all copyright rights in any work subject to the
copyright laws of the United States or any other country, whether as author,
assignee, transferee or otherwise, and (b) all registrations and
applications for registration of any such copyright in the United States or any
other country, including registrations, recordings, supplemental registrations
and pending applications for registration in the United States Copyright Office,
including those listed on Schedule III.

     

    “Equity Interests”
means shares of capital stock, partnership interests, membership interests in a
limited liability company, beneficial interests in a trust or other equity
ownership interests in a Person, and any warrants, options or other rights
entitling the holder thereof to purchase or acquire any such equity
interest.

     

    “Excluded Property”
shall mean and include all of the following assets and properties of any
Indenture Party:

     

    (i)           equipment
that is subject to any “purchase money security interests,” as such term is now
or hereafter defined in the Uniform Commercial Code, or a capital lease, which
in either case (x) constitutes a Lien permitted under the
Indenture  and (y) prohibits the creation by such Indenture Party of a
junior security interest therein, unless the holder thereof has consented to the
creation of such junior security interest;

     

    (ii)           any
contract or instrument in which any Indenture Party has any right, title or
interest if and to the extent such contract or instrument includes a provision
containing a restriction on assignment such that the creation of a security
interest in the right, title or interest of such Indenture Party therein would
be prohibited and would, in and of itself, cause or result in a default
thereunder enabling another person party to such contract or instrument to
enforce any remedy with respect thereto; provided, however, that the foregoing
exclusion shall not apply if (i) such prohibition has been waived or such other
Person has otherwise consented to the creation hereunder of a security interest
in such contract or instrument, or (ii) such prohibition would be rendered
ineffective pursuant to Section 9-318(4) of the Uniform Commercial Code or
Sections 9-407(a) or 9-408(a) of the Uniform Commercial Code, as applicable and
as then in effect in any relevant jurisdiction, or any other applicable law
(including applicable bankruptcy and insolvency law) or principles of equity;
provided further that immediately upon the ineffectiveness, lapse or termination
of any such provision, the term “Collateral” shall include, and each such
Indenture Party shall be deemed to have granted a security interest in, all its
rights, title and interests in and to such contract or instrument as if such
provision had never been in effect; and provided further that the foregoing
exclusion shall in no way be construed so as to limit, impair or otherwise
affect the Collateral Agent’s unconditional continuing security interest in and
to all rights, title and interests of each such Indenture Party in or to any
payment obligations or other rights to receive monies due or to become due under
any such contract or instrument and in any such monies and other proceeds of
such contract or instrument;


    
      
         


      

      
        6

        
          

        

      

      
         


      

    

     

    
      	
               
      

            	
              (iii)

            	
              the
      Equity Interests referred to in Section 3.01(a)(i) and
    (ii);

            


    

     

    (iv)           Equity
Interests of any CFC, solely to the extent that (y) such Equity Interests
represents more than 65% of the total outstanding Voting Stock of any first tier
Subsidiary of an Indenture Party that is a CFC or any of the outstanding
Equity Interests of any Subsidiary of such CFC and (z) hypothecating more than
65% of the total outstanding Voting Stock of such CFC would result in material
adverse tax consequences;

     

    (v)           any
Equity Interests or assets of any Unrestricted Subsidiary;

     

    (vi)          any
assets with respect to which the burden or cost of obtaining or perfecting a
security interest or Lien sufficiently outweighs the benefit to the Secured
Parties, as set forth in an Officers’ Certificate delivered to the Trustee in
accordance with the terms of the Indenture;

     

    (vii)         any
application to register any trademark, service mark or other mark prior to the
filing under applicable law of a verified statement of use (or the equivalent)
for such trademark, service mark or other mark to the extent the creation of a
security interest therein or the grant of a mortgage thereon would void or
invalidate such trademark, service mark or other mark); or

     

    (viii)        any
deposit account maintained to fund taxes, payroll obligations and/or employee
benefit plans (including medical or insurance reimbursement accounts) or any
deposit account which has an average monthly balance of less than
$250,000.

     

    “Federal Securities
Laws” has the meaning assigned to such term in
Section 5.04.

     

    “General Intangibles”
means all “General Intangibles” as defined in the New York UCC, including all
choses in action and causes of action and all other intangible personal property
of every kind and nature (other than accounts) now owned or hereafter acquired
by any Grantor, including all rights and interests in partnerships, limited
partnerships, limited liability companies and other unincorporated
entities,  corporate or other business records, indemnification
claims, contract rights (including rights under leases, whether entered into as
lessor or lessee, Interest Rate Agreements, Commodity Agreements, Natural Gas
Agreements, Currency Agreements and other agreements), Intellectual Property,
goodwill, registrations, franchises, tax refund claims and any letter of credit,
guarantee, claim, security interest or other security held by or granted to any
Grantor to secure payment by an Account Debtor of any of the
accounts.


    
      
         


      

      
        7

        
          

        

      

      
         


      

    


    “Grantors” means the
Company and the Subsidiary Parties.

     

    “Guarantors” means the
Subsidiary Parties.

     

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

     

    “Indenture Documents”
means the Indenture, the Notes and the Collateral Agreements.

     

    “Indenture Parties”
means the Company and the Subsidiaries.

     

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

     

    “License” means any
Patent License, Trademark License, Copyright License or other license or
sublicense agreement to which any Grantor is a party, including those listed on
Schedule III.

     

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

     

    “Obligations” means
(a) the due and punctual payment by the Company of (i) the principal of and
interest (including interest accruing during the pendency of any bankruptcy,
insolvency, receivership or other similar proceeding, regardless of whether
allowed or allowable in such proceeding) on the Notes, when and as due, whether
at maturity, by acceleration, upon one or more dates set for prepayment or
otherwise and (ii) all other monetary obligations of the Company to any of the
Secured Parties under the Indenture and each of the other Indenture Documents,
including obligations to pay fees, expense reimbursement obligations and
indemnification obligations, whether primary, secondary, direct, contingent,
fixed or otherwise (including monetary obligations incurred during the pendency
of any bankruptcy, insolvency, receivership or other similar proceeding,
regardless of whether allowed or allowable in such proceeding), (b) the due and
punctual performance of all other obligations of the Company under or pursuant
to the Indenture and each of the other Indenture Documents and (c) the due and
punctual payment and performance of all the obligations of each Subsidiary under
or pursuant to this Agreement and each of the other Indenture
Documents.


    
      
         


      

      
        8

        
          

        

      

      
         


      

    


    “Patent License” means
any written agreement, now or hereafter in effect, granting to any third party
any right to make, use or sell any invention on which a patent, now or hereafter
owned by any Grantor or that any Grantor otherwise has the right to license, is
in existence, or granting to any Grantor any right to make, use or sell any
invention on which a patent, now or hereafter owned by any third party, is in
existence, and all rights of any Grantor under any such agreement.

     

    “Patents” means all of
the following now owned or hereafter acquired by any
Grantor:  (a) all letters patent of the United States or the
equivalent thereof in any other country, all registrations and recordings
thereof, and all applications for letters patent of the United States or the
equivalent thereof in any other country, including registrations, recordings and
pending applications in the United States Patent and Trademark Office or any
similar offices in any other country, including those listed on
Schedule III and (b) all reissues, continuations, divisions,
continuations-in-part, renewals or extensions thereof, and the inventions
disclosed or claimed therein, including the right to make, use and/or sell the
inventions disclosed or claimed therein.

     

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

     

    “Pledged Debt
Securities” has the meaning assigned to such term in Section
3.01.

     

    “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.

     

    “Pledged Stock” has
the meaning assigned to such term in Section 3.01.

     

    “Proceeds” has the
meaning specified in Section 9-102 of the New York UCC.

     

    “Secured Parties”
means (a) the Noteholders, (b) the Trustee, (c) the Collateral Agent,
(d) the beneficiaries of each indemnification obligation undertaken by any
Indenture Party under any Indenture Document, including without limitation the
Trustee, and (e) the permitted successors and assigns of each of the
foregoing.

     

    “Security Interest”
has the meaning assigned to such term in Section 4.01.

     

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

     

    “Trademark License”
means any written agreement, now or hereafter in effect, granting to any third
party any right to use any trademark now or hereafter owned by any Grantor or
that any Grantor otherwise has the right to license, or granting to any Grantor
any right to use any trademark now or hereafter owned by any third party, and
all rights of any Grantor under any such agreement.


    
      
         


      

      
        9

        
          

        

      

      
         


      

    


    “Trademarks” means all
of the following now owned or hereafter acquired by any Grantor: (a) all
trademarks, service marks, trade names, corporate names, company names, business
names, fictitious business names, trade styles, trade dress, logos, other source
or business identifiers, designs and general intangibles of like nature, now
existing or hereafter adopted or acquired, all registrations and recordings
thereof, and all registration and recording applications filed in connection
therewith, including registrations and registration applications in the United
States Patent and Trademark Office or any similar offices in any State of the
United States or any other country or any political subdivision thereof, and all
extensions or renewals thereof, including those listed on Schedule III, (b)
all goodwill associated therewith or symbolized thereby and (c) all other
assets, rights and interests that uniquely reflect or embody such
goodwill.

     

    ARTICLE
II

     

    Guarantee

     

    SECTION
2.01.  Guarantee.  Each
Guarantor unconditionally guarantees, jointly with the other Guarantors and
severally, as a primary obligor and not merely as a surety, the due and punctual
payment and performance of the Obligations.  Each of the Guarantors
further agrees that the Obligations may be extended or renewed, in whole or in
part, without notice to or further assent from it, and that it will remain bound
upon its guarantee notwithstanding any extension or renewal of any
Obligation.  Each of the Guarantors waives presentment to, demand of
payment from and protest to the Company or any other Indenture Party of any of
the Obligations, and also waives notice of acceptance of its guarantee and
notice of protest for nonpayment.

     

    SECTION
2.02.  Guarantee of
Payment.  Each of the Guarantors further agrees that its
guarantee hereunder constitutes a guarantee of payment when due and not of
collection, and waives any right to require that any resort be had by the
Collateral Agent or any other Secured Party to any security held for the payment
of the Obligations or to any balance of any deposit account or credit on the
books of the Collateral Agent or any other Secured Party in favor of the Company
or any other Person.

     

    SECTION
2.03.  No
Limitations.  (a)  Except for termination of a
Guarantor’s obligations hereunder as expressly provided in Section 7.13, the
obligations of each Guarantor hereunder shall not be subject to any reduction,
limitation, impairment or termination for any reason, including any claim of
waiver, release, surrender, alteration or compromise, and shall not be subject
to any defense or set-off, counterclaim, recoupment or termination whatsoever by
reason of the invalidity, illegality or unenforceability of the Obligations or
otherwise.  Without limiting the generality of the foregoing, the
obligations of each Guarantor hereunder shall not be discharged or impaired or
otherwise affected by (i) the failure of the Collateral Agent or any other
Secured Party to assert any claim or demand or to enforce any right or remedy
under the provisions of any Indenture Document or otherwise; (ii) any
rescission, waiver, amendment or modification of, or any release from any of the
terms or provisions of, any Indenture Document or any other agreement, including
with respect to any other Guarantor under this Agreement; (iii) the release
of any security held by the Collateral Agent or any other Secured Party for the
Obligations or any of them; (iv) any default, failure or delay, willful or
otherwise, in the performance of the Obligations; or (v) any other act or
omission that may or might in any manner or to any extent vary the risk of any
Guarantor or otherwise operate as a discharge of any Guarantor as a matter of
law or equity (other than the indefeasible payment in full in cash of all the
Obligations).  Each Guarantor expressly authorizes the Collateral
Agent to take and hold security for the payment and performance of the
Obligations, to exchange, waive or release any or all such security (with or
without consideration), to enforce or apply such security and direct the order
and manner of any sale thereof in its sole discretion or to release or
substitute any one or more other guarantors or obligors upon or in respect of
the Obligations, all without affecting the obligations of any Guarantor
hereunder.


    
      
         


      

      
        10

        
          

        

      

      
         


      

    


    (b)  To
the fullest extent permitted by applicable law, each Guarantor waives any
defense based on or arising out of any defense of the Company or any Indenture
Party or the unenforceability of the Obligations or any part thereof from any
cause, or the cessation from any cause of the liability of the Company or any
other Indenture Party, other than the indefeasible payment in full in cash of
all the Obligations.  The Collateral Agent and the other Secured
Parties may, at their election, foreclose on any security held by one or more of
them by one or more judicial or nonjudicial sales, accept an assignment of any
such security in lieu of foreclosure, compromise or adjust any part of the
Obligations, make any other accommodation with the Company or any other
Indenture Party or exercise any other right or remedy available to them against
the Company or any other Indenture Party, without affecting or impairing in any
way the liability of any Guarantor hereunder, except to the extent the
Obligations have been fully and indefeasibly paid in full in cash.  To
the fullest extent permitted by applicable law, each Guarantor waives any
defense arising out of any such election even though such election operates,
pursuant to applicable law, to impair or to extinguish any right of
reimbursement or subrogation or other right or remedy of such Guarantor against
the Company or any other Indenture Party, as the case may be, or any
security.

     

    SECTION
2.04.  Reinstatement.  Each
of the Guarantors agrees that its guarantee hereunder shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of any Obligation is rescinded or must otherwise be restored by
the Collateral Agent or any other Secured Party upon the bankruptcy or
reorganization of the Company, any other Indenture Party or
otherwise.

     

    SECTION
2.05.  Agreement To Pay;
Subrogation.  In furtherance of the foregoing and not in
limitation of any other right that the Collateral Agent or any other Secured
Party has at law or in equity against any Guarantor by virtue hereof, upon the
failure of the Company or any other Indenture Party to pay any Obligation when
and as the same shall become due, whether at maturity, by acceleration, after
notice of prepayment or otherwise, each Guarantor hereby promises to and will
forthwith pay, or cause to be paid, to the Collateral Agent for distribution to
the applicable Secured Parties in cash the amount of such unpaid
Obligation.  Upon payment by any Guarantor of any sums to the
Collateral Agent as provided above, all rights of such Guarantor against the
Company or any other Indenture Party arising as a result thereof by way of right
of subrogation, contribution, reimbursement, indemnity or otherwise shall in all
respects be subject to Article VI.


    
      
         


      

      
        11

        
          

        

      

      
         


      

    


    SECTION
2.06.  Information.  Each
Guarantor assumes all responsibility for being and keeping itself informed of
the Company’s and each other Indenture Party’s financial condition and assets,
and of all other circumstances bearing upon the risk of nonpayment of the
Obligations and the nature, scope and extent of the risks that such Guarantor
assumes and incurs hereunder, and agrees that none of the Collateral Agent or
the other Secured Parties will have any duty to advise such Guarantor of
information known to it or any of them regarding such circumstances or
risks.

     

    ARTICLE
III

     

    Pledge of
Securities

     

    SECTION
3.01.  Pledge.  As
security for the payment or performance, as the case may be, in full of the
Obligations, each Grantor hereby assigns and pledges to the Collateral Agent,
its successors and assigns, for the ratable benefit of the Secured Parties, and
hereby grants to the Collateral Agent, its successors and assigns, for the
ratable benefit of the Secured Parties, a security interest in, all of such
Grantor’s right, title and interest in, to and under (a) the shares of
capital stock and other Equity Interests owned by it, including but not limited
to those listed on Schedule II and any other Equity Interests obtained in
the future by such Grantor and the certificates, if any, representing all such
Equity Interests (the “Pledged Stock”);
provided, that
the Pledged Stock shall not include (i) Equity Interests of Wolverine China
Investments LLC, or (ii) Equity Interests of any Person of which the Indenture
Parties individually or in the aggregate do not own in excess of 50% of the
issued and outstanding Equity Interests of such Person and the pledge or other
Lien upon such Equity Interest is prohibited pursuant to a bona fide agreement
with any such Person; (b)(i) the debt securities listed opposite the name
of such Grantor on Schedule II, (ii) any debt securities in the future
issued to such Grantor and (iii) the promissory notes and any other
instruments evidencing such debt securities (the “Pledged Debt
Securities”); (c) all other property that may be delivered to and
held by the Collateral Agent pursuant to the terms of this Section 3.01;
(d) subject to Section 3.06, 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 (a) and (b) above; (e) subject to
Section 3.06, all rights and privileges of such Grantor with respect to the
securities and other property referred to in clauses (a), (b), (c) and (d)
above; and (f) all Proceeds of any of the foregoing (the items referred to
in clauses (a) through (f) 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 ratable benefit of the
Secured Parties, forever; subject, however, to the
terms, covenants and conditions hereinafter set forth (including Section
7.13).


    
      
         


      

      
        12

        
          

        

      

      
         


      

    


    SECTION
3.02.  Delivery of the Pledged
Collateral.  (a)  Each Grantor agrees promptly to
deliver or cause to be delivered to the Collateral Agent any and all
certificated Pledged Securities.

     

    (b)  Each
Grantor will cause any Indebtedness for borrowed money owed to such Grantor by
any Person (other than any Subsidiary Parties) in an amount in excess of
$250,000 to be evidenced by a duly executed promissory note that is pledged and
delivered to the Collateral Agent pursuant to the terms hereof.

     

    (c)  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 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, including as reasonably requested by the Holders of a
majority in principal amount of the Notes.  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
3.03.  Representations, Warranties
and Covenants.  The Grantors jointly and severally represent,
warrant and covenant to and with the Collateral Agent, for the benefit of the
Secured Parties, that:

     

    (a)  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 such
Pledged Stock;

     

    (b)  the
Pledged Stock and Pledged Debt Securities have been duly and validly authorized
and issued by the issuers thereof and (i) in the case of Pledged Stock, are
fully paid and nonassessable, and (ii) in the case of Pledged Debt Securities,
are legal, valid and binding obligations of the issuers thereof;

     

    (c)  except
for the security interests granted hereunder, 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 Grantor, (ii) holds
the same free and clear of all Liens, other than Liens created by this
Agreement, Liens permitted under the Indenture and transfers made in compliance
with 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 Liens created by this Agreement, Liens
permitted under the Indenture and transfers made in compliance with the
Indenture and (iv) will defend its title or interest thereto or therein
against any and all Liens (other than the Lien created by this Agreement and
Liens permitted under the Indenture), however arising, of all Persons
whomsoever;


    
      
         


      

      
        13

        
          

        

      

      
         


      

    


    (d)  except
for restrictions and limitations imposed by the Indenture Documents or
securities laws generally, the Pledged Collateral is and will continue to be
freely transferable and assignable, and none of the Pledged Collateral (other
than Pledged Collateral representing less than all of the Equity Interests of a
Person) 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 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 requisite power and authority to pledge the Pledged
Collateral pledged by it hereunder in the manner hereby done or
contemplated;

     

    (f)  no
consent or approval of any Governmental Authority, any securities exchange or
any other Person was or is necessary to the validity of the pledge of the
Pledged Collateral effected hereby (other than such as have been obtained and
are in full force and effect and except with respect to Pledged Collateral in
the form of Equity Interests in joint ventures);

     

    (g)  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, the Collateral Agent will obtain a legal, valid and perfected first
priority lien upon and security interest in such Pledged Securities as security
for the payment and performance of the Obligations;

     

    (h)  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; and

     

    (i)  each
of the Grantors received adequate consideration in exchange for entering into
this Agreement.

     

    SECTION
3.04.  Certification of Limited
Liability Company and Limited Partnership Interests.  On the
date hereof, no Equity Interest in any limited liability company or limited
partnership controlled by any Grantor and pledged hereunder (the “Existing LLC/Partnership
Interests”) is represented by a certificate.  Each Grantor
agrees that (a) if any Existing LLC/Partnership Interest controlled by such
Grantor shall become represented by a certificate, it shall cause such
certificate to be promptly delivered to the Collateral Agent and shall cause the
applicable limited liability company or partnership agreement to be amended so
as to treat the Equity Interest represented by such certificate as a “security”
within the meaning of Article 8 of the UCC and to provide that such security
shall be governed by Article 8 of the UCC and (b) each interest in any limited
liability company or partnership acquired by such Grantor after the date hereof
shall be represented by a certificate (which shall be promptly delivered to the
Collateral Agent after such Grantor’s acquisition thereof), shall be a
“security” within the meaning of Article 8 of the UCC and shall be governed by
Article 8 of the UCC.


    
      
         


      

      
        14

        
          

        

      

      
         


      

    


    SECTION
3.05.  Registration in Nominee
Name; Denominations.  The Collateral Agent, on behalf of the
Secured Parties, shall hold the Pledged Securities in the name of the applicable
Grantor, endorsed or assigned in blank or in favor of the Collateral Agent, but
following the occurrence and during the continuance of an Event of Default shall
have the right (in its sole and absolute discretion) to hold the Pledged
Securities in its own name as pledgee, or in the name of its nominee (as pledgee
or as sub-agent).  Each Grantor will promptly give to the Collateral
Agent copies of any material notices or other communications received by it with
respect to Pledged Securities registered in the name of such
Grantor.  The Collateral Agent shall promptly deliver such material
notices or other communications to the Trustee, who shall mail such notices or
communications to each Holder within 90 days following the receipt of such
notice or communications.  The Collateral Agent shall at all times
have the right to exchange the certificates representing Pledged Securities for
certificates of smaller or larger denominations for any reasonable purpose
consistent with this Agreement.

     

    SECTION
3.06.  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 Grantors that their rights under this Section 3.06 are being
suspended (which notice shall be deemed to have been given immediately upon the
occurrence of an Event of Default with respect to the Company under Section
6.01(7) and Section 6.01(8) of the Indenture):

     

    (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 Indenture Documents; provided, that such
rights and powers shall not be exercised in any manner that could reasonably be
expected to materially and adversely affect the rights inuring to a holder of
any Pledged Securities or the rights and remedies of any of the Collateral Agent
or the other Secured Parties under this Agreement or the Indenture or any other
Indenture Documents or the ability of the Secured Parties to exercise the
same.

     

    (ii) The
Collateral Agent shall promptly 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.


    
      
         


      

      
        15

        
          

        

      

      
         


      

    


    (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 Indenture Documents and applicable laws; provided, that any
noncash dividends, interest, principal or other distributions that would
constitute Pledged Stock or Pledged Debt Securities, 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 shall be forthwith delivered to the Collateral Agent in the same form as so
received (with any necessary endorsement).

     

    (b)  Upon
the occurrence and during the continuance of an Event of Default, after the
Collateral Agent shall have notified (or shall be deemed to have notified) the
Grantors of the suspension of their rights under paragraph (a)(iii) of this
Section 3.06, 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 3.06 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 3.06 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 same form as so received (with any necessary
endorsement).  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 5.02.  After
all Events of Default have been cured or waived and the Company has delivered to
the Collateral Agent a certificate to that effect, 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 3.06 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 (or shall be deemed to have notified) the
Grantors of the suspension of their rights under paragraph (a)(i) of this
Section 3.06, 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 3.06, and the obligations of the
Collateral Agent under paragraph (a)(ii) of this Section 3.06, 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 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.


    
      
         


      

      
        16

        
          

        

      

      
         


      

    


    (d)  Any
notice given by the Collateral Agent to the Grantors suspending the Grantors’
rights under paragraph (a) of this Section 3.06 (i) may be given by
telephone if promptly confirmed in writing, (ii) may be given 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 in its sole and
absolute discretion) 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
IV

     

    Security Interests in
Personal Property

     

    SECTION
4.01.  Security
Interest.  (a)  As security for the payment or
performance, as the case may be, in full of the Obligations, each Grantor hereby
assigns and pledges to the Collateral Agent, its successors and assigns, for the
ratable benefit of the Secured Parties, and hereby grants to the Collateral
Agent, its successors and assigns, for the ratable 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 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 cash and deposit accounts;

            


    

     

    
      	
            	
              (iv)

            	
               
      all documents;

            


    

     

    
      	
            	
              (v)

            	
               
      all equipment;

            


    

     

    
      	
            	
              (vi)

            	
               
      all General Intangibles;

            


    

     

    
      	
            	
              (vii)

            	
               
      all instruments;

            


    

     

    
      	
            	
              (viii)

            	
               
      all inventory;

            


    

     

    
      	
            	
              (ix)

            	
               
      all investment property;

            


    

     

    
      	
            	
              (x)

            	
               
      all letter-of-credit rights;

            


    


    
      
         


      

      
        17

        
          

        

      

      
         


      

    


    
      	
            	
              (xi)

            	
               
      all commercial tort claims;

            


    

     

    
      	
            	
              (xii)

            	
               
      all books and records pertaining to the Article 9 Collateral;
      and

            


    

     

    
      (xiii)  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.

    

     

    Notwithstanding
the foregoing, the Article 9 Collateral shall not include the Excluded
Property.

     

    (b)  Each
Grantor hereby irrevocably authorizes the Collateral Agent 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 and
(ii) contain the information required by Article 9 of the Uniform
Commercial Code of each applicable jurisdiction for the filing of any financing
statement or amendment, 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.

     

    Each
Grantor also ratifies its authorization for the Collateral Agent to file in any
relevant jurisdiction any initial financing statements or amendments thereto if
filed prior to the date hereof.

     

    The
Collateral Agent is further authorized to file with the United States Patent and
Trademark Office or United States Copyright Office (or any successor office or
any similar office in any other country) such documents as may be necessary or
advisable for the purpose of perfecting, confirming, continuing, enforcing or
protecting the Security Interest granted by each Grantor, without the signature
of any Grantor, and naming any Grantor or the Grantors as debtors and the
Collateral Agent as secured party.  The foregoing rights of the
Collateral Agent shall not be construed as a duty of the Collateral Agent, it
being expressly understood and agreed that the Grantors shall bear the
responsibility of all such filings.

     

    (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
4.02.  Representations and
Warranties.  The Grantors jointly and severally represent and
warrant to the Collateral Agent and the Secured Parties, subject to the last
paragraph of this Section 4.02, that:


    
      
         


      

      
        18

        
          

        

      

      
         


      

    


    (a)  Each
Grantor has good and valid rights in and title to the Article 9 Collateral
with respect to which it 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, without the consent or approval of any other Person other than any
consent or approval that has been obtained.

     

    (b)  Uniform
Commercial Code financing statements (including fixture filings, as applicable)
or other appropriate filings, recordings or registrations containing a
description of the Article 9 Collateral prepared by the Collateral Agent based
upon the information provided to the Collateral Agent by the Indenture Parties
are all the filings, recordings and registrations (other than filings required
to be made in the United States Patent and Trademark Office and the United
States Copyright Office in order to perfect the Security Interest in
Article 9 Collateral consisting of Patents, Trademarks and Copyrights) that
are necessary to publish notice of and protect the validity of and to establish
a legal, valid and perfected security interest in favor of the Collateral Agent
(for the ratable 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.  Each Grantor represents and warrants that a fully
executed agreement in the form hereof (or a fully executed short-form agreement
as reasonably determined by the Indenture Parties) and containing a description
of all Article 9 Collateral consisting of Intellectual Property with
respect to United States Patents (and Patents for which United States
registration applications are pending), United States registered Trademarks (and
Trademarks for which United States registration applications are pending) and
United States registered Copyrights (and all pending registrations therefor) has
been delivered to the Collateral Agent for recording by the United States Patent
and Trademark Office and the United States Copyright Office pursuant to
35 U.S.C. § 261, 15 U.S.C. § 1060 or
17 U.S.C. § 205 and the regulations thereunder, as applicable, to
protect the validity of and to establish a legal, valid and perfected security
interest in favor of the Collateral Agent (for the ratable benefit of the
Secured Parties) in respect of all Article 9 Collateral consisting of
Patents, Trademarks and Copyrights in which a security interest may be perfected
by filing, recording or registration in the United States (or any political
subdivision thereof) and its territories and possessions, and no further or
subsequent filing, refiling, recording, rerecording, registration or
reregistration is necessary (other than such actions as are necessary to perfect
the Security Interest with respect to any Article 9 Collateral consisting
of Patents, Trademarks and Copyrights (or registration or application for
registration thereof) acquired or developed after the date
hereof).


    
      
         


      

      
        19

        
          

        

      

      
         


      

    


    (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
Obligations, (ii) subject to the filings described in Section 4.02(b),
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 and (iii) a security interest that shall be perfected in
all Article 9 Collateral in which a security interest may be perfected upon
the receipt and recording of this Agreement (or the short-form agreement
referenced in paragraph (b) above) with the United States Patent and Trademark
Office and the United States Copyright Office, as applicable, within the
three-month period (commencing as of the date hereof) pursuant to 35 U.S.C.
§ 261 or 15 U.S.C. § 1060 or the one month period (commencing as
of the date hereof) pursuant to 17 U.S.C. § 205.  The
Security Interest is and shall be prior to any other Lien on any of the
Article 9 Collateral, other than Liens expressly permitted to be prior to
the Security Interest pursuant to Section 6.02 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 4.11 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, (ii) any assignment in which any Grantor assigns any Collateral
or any security agreement or similar instrument covering any Article 9
Collateral with the United States Patent and Trademark Office or the United
States Copyright Office or (iii) 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 4.11 of the
Indenture.

     

    SECTION
4.03.  Covenants.  (a)   Each
Grantor agrees promptly to notify the Collateral Agent in writing of any change
(i) in corporate name, (ii) in the location of its chief executive
office, its principal place of business, any office in which it maintains books
or records relating to Article 9 Collateral owned by it or any office or
facility at which Article 9 Collateral owned by it is located (including
the establishment of any such new office or facility), (iii) in its
identity or type of organization or corporate structure, (iv) in its
Federal Taxpayer Identification Number or organizational identification number
or (v) in its jurisdiction of organization.  Each Grantor agrees
to promptly provide the Collateral Agent with certified organizational documents
reflecting any of the changes described in the first sentence of this
paragraph.  Each Grantor agrees not to effect or permit any change
referred to in the preceding sentence unless all filings have been made under
the Uniform Commercial Code or otherwise that are required in order for the
Collateral Agent to continue at all times following such change to have a valid,
legal and perfected first priority security interest in all the Article 9
Collateral to the same extent as existed immediately prior to such
change.

     

    (b)  Each
Grantor agrees to maintain, at its own cost and expense, such complete and
accurate records with respect to the Article 9 Collateral owned by it as is
prudent in the conduct of its business, but in any event to include complete
accounting records indicating all payments and proceeds received with respect to
the Article 9 Collateral, and, at such time or times as the Collateral
Agent may reasonably request, promptly to prepare and deliver to the Collateral
Agent a duly certified schedule or schedules in form and detail reasonably
satisfactory to the Collateral Agent showing the identity, amount and location
of any and all Article 9 Collateral.


    
      
         


      

      
        20

        
          

        

      

      
         


      

    


    (c)  Each
year, at the time of delivery of annual financial statements with respect to the
preceding fiscal year pursuant to Section 4.02 of the Indenture, the
Company shall deliver to the Collateral Agent a certificate executed by a
Financial Officer and the chief legal officer of the Company confirming that
there has been no material change in such information since the date of such
certificate or the date of the most recent certificate delivered pursuant to
this Section 4.03(c).  Each certificate delivered pursuant to
this Section 4.03(c) shall identify in the format of Schedule III all
Intellectual Property of any Grantor in existence on the date thereof and not
then listed on such Schedules or previously so identified to the Collateral
Agent.

     

    (d)  Each
Grantor shall, at its own expense, take any and all commercially reasonable
actions necessary to defend title to all material portions of the Article 9
Collateral against all Persons and to defend the Security Interest of the
Collateral Agent in all material portions of the Article 9 Collateral and
the priority thereof against any Lien not expressly permitted pursuant to
Section 4.11 of the Indenture.

     

    (e)  Each
Grantor agrees, 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 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 to any Grantor under or in
connection with any of the Article 9 Collateral shall be or become
evidenced by any promissory note or other instrument, such note or instrument
shall be promptly pledged and delivered to the Collateral Agent, duly endorsed
in a manner consistent with Section 3.02.

     

    Without
limiting the generality of the foregoing, each Grantor hereby authorizes the
Collateral Agent, with prompt notice thereof to the Grantors, to supplement this
Agreement by supplementing Schedule III or adding additional schedules
hereto to specifically identify any asset or item that may constitute
Copyrights, Licenses, Patents or Trademarks; provided, that any
Grantor shall have the right, exercisable within 10 days after it has been
notified by the Collateral Agent of the specific identification of such
Collateral, to advise the Collateral Agent in writing of any inaccuracy of the
representations and warranties made by such Grantor hereunder with respect to
such Collateral.  Each Grantor agrees that it will use its best
efforts to take such action as shall be reasonably necessary in order that all
representations and warranties hereunder shall be true and correct in all
material respects with respect to such Collateral within 30 days after the
date it has been notified by the Collateral Agent of the specific identification
of such Collateral.


    
      
         


      

      
        21

        
          

        

      

      
         


      

    


    (f)  The
Collateral Agent and such Persons as the Collateral Agent may reasonably
designate shall have the right, upon reasonable prior written notice and during
normal business hours (but in no event more than once each fiscal quarter unless
a Default has occurred and is continuing), at the Grantors’ own cost and
expense, to inspect the Article 9 Collateral, all records related thereto
(and to make extracts and copies from such records) and the premises upon which
any of the Article 9 Collateral is located, to discuss the Grantors’
affairs with the officers of the Grantors and their independent accountants and
to verify under reasonable procedures the validity, amount, quality, quantity,
value, condition and status of, or any other matter relating to, the Article 9
Collateral, including, in the case of accounts or Article 9 Collateral in
the possession of any third person, by contacting Account Debtors or the third
person possessing such Article 9 Collateral for the purpose of making such
a verification.  The Collateral Agent shall have the absolute right to
share any information it gains from such inspection or verification with any
Secured Party.

     

    (g)  At
its option, the Collateral Agent may discharge past due taxes, assessments,
charges, fees, Liens, security interests or other encumbrances at any time
levied or placed on the Article 9 Collateral and not expressly permitted
pursuant to Section 4.11 of the Indenture (and shall notify the Company
upon any such discharge), 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 each Grantor jointly and
severally agrees to reimburse the Collateral Agent on demand for any payment
made or any reasonable expense incurred by the Collateral Agent pursuant to the
foregoing authorization; provided, that
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 Indenture
Documents.

     

    (h)  If
at any time any Grantor shall take a security interest in any property of an
Account Debtor or any other Person to secure payment and performance of an
account in excess of $250,000, such Grantor shall promptly assign such security
interest to the Collateral Agent.  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.

     

    (i)  As
between each Grantor, the Collateral Agent and the Secured Parties, each Grantor
shall remain liable 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.


    
      
         


      

      
        22

        
          

        

      

      
         


      

    


    (j)  None
of the Grantors shall make or permit to be made an assignment, pledge or
hypothecation of the Article 9 Collateral or shall grant any other Lien in
respect of the Article 9 Collateral, except as permitted by the
Indenture.  None of the Grantors shall make or permit to be made any
transfer of the Article 9 Collateral and each Grantor shall remain at all times
in possession of the Article 9 Collateral owned by it, except that unless and
until the Collateral Agent shall notify the Grantors that an Event of Default
shall have occurred and be continuing and that during the continuance thereof
the Grantors shall not sell, convey, lease, assign, transfer or otherwise
dispose of any Article 9 Collateral (which notice may be given by telephone if
promptly confirmed in writing), the Grantors may use and dispose of the Article
9 Collateral in any lawful manner not inconsistent with the provisions of this
Agreement, the Indenture or any other Indenture Document.

     

    (k)  None
of the Grantors will, without the Collateral Agent’s prior written consent,
which shall be directed by the Holders of a majority in outstanding principal
amount of the Notes, grant any extension of the time of payment of any accounts
included in the Article 9 Collateral, compromise, compound or settle the
same for less than the full amount thereof, release, wholly or partly, any
Person liable for the payment thereof or allow any credit or discount whatsoever
thereon, other than extensions, compromises, settlements, releases, credits or
discounts granted or made in good faith in the prudent conduct of the business
of such Grantor.

     

    (l)  The
Grantors, at their own expense, shall maintain or cause to be maintained
insurance covering physical loss or damage to the inventory and equipment in
accordance with the requirements set forth in Schedule IV
hereto.  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)
for the purpose, upon the occurrence and during the continuance of an Event of
Default, of 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 of insurance and for making all determinations and decisions with
respect thereto.  In the event that any Grantor at any time or times
shall fail to obtain or maintain any of the policies of insurance required
hereby or under the Indenture or to pay any premium in whole or part relating
thereto, the Collateral Agent may, without waiving or releasing any obligation
or liability of the Grantors hereunder or any Event of Default, in its sole
discretion, obtain and maintain such policies of insurance and pay such premium
and take any other actions with respect thereto as the Collateral Agent deems
advisable.  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, upon demand, by the
Grantors to the Collateral Agent and shall be additional Obligations secured
hereby.

     

    (m)  Each
Grantor shall maintain, in form and manner reasonably satisfactory to the
Collateral Agent, records of its chattel paper and its books, records and
documents evidencing or pertaining thereto.

     

    SECTION
4.04.  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:

     

    
      
        
        

      

      
        23

        
          

        

      

      
        
        

      

    

     

    (a)  Instruments.  If
any Grantor shall at any time hold or acquire any instruments, such Grantor
shall forthwith endorse, assign and deliver the same to the Collateral Agent,
accompanied by such instruments of transfer or assignment duly executed in blank
as the Collateral Agent may from time to time reasonably request, other than
instruments that do not individually or in the aggregate exceed
$250,000.

     

    (b)  Pledged
Stock.  Each Grantor shall, within five (5) Business Days of
the date hereof, deliver to the Collateral Agent any and all certificates
representing its Pledged Stock, subject to Section 3.01 and excluding any
Excluded Property.

     

    (c)  Deposit
Accounts.  Except for the Excluded Property, for each deposit
account that any Grantor at any time opens or maintains, such Grantor shall, on
or prior to September 30, 2009, either (i) cause the depositary bank to
agree to comply with instructions from the Collateral Agent to such depositary
bank directing the disposition of funds from time to time credited to such
deposit account, without further consent of such Grantor or any other Person,
pursuant to an agreement substantially in the form attached hereto as Exhibit I
or as otherwise reasonably determined by such Grantor, or (ii) arrange for
the Collateral Agent to become the customer of the depositary bank with respect
to such deposit account, with the Grantor being permitted, only with the
reasonable consent of the Collateral Agent, to exercise rights to withdraw funds
from such deposit account.  The Collateral Agent agrees with each
Grantor that the Collateral Agent shall not give any such instructions or
withhold any withdrawal rights from any Grantor unless an Event of Default has
occurred and is continuing, or, after giving effect to any withdrawal would
occur.

     

    (d)  Investment
Property.  Except to the extent otherwise provided in
Article III, if any Grantor shall at any time hold or acquire any
certificated securities, such Grantor shall forthwith endorse, assign and
deliver the same to the Collateral Agent, accompanied by such instruments of
transfer or assignment duly executed in blank as the Collateral Agent may from
time to time specify.  If any securities now or hereafter acquired by
any Grantor are “uncertificated securities” (as defined in Section 8-102(18) of
the New York UCC) and are issued to such Grantor or its nominee directly by the
issuer thereof, such Grantor shall promptly notify the Collateral Agent thereof
and, at the Collateral Agent’s request and option, either (i) use its best
efforts to cause the issuer to agree to comply with instructions from the
Collateral Agent as to such securities, without further consent of any Grantor
or such nominee or (ii) arrange for the Collateral Agent to become the
registered owner of the securities.  If any securities, whether
certificated or uncertificated, or other investment property now or hereafter
acquired by any Grantor are held by such Grantor or its nominee through a
securities intermediary or commodity intermediary, such Grantor shall promptly
notify the Collateral Agent thereof and, at the Collateral Agent’s request and
option, either (i) use its best efforts to cause such securities
intermediary or (as the case may be) commodity intermediary to agree to comply
with entitlement orders or other instructions from the Collateral Agent to such
securities intermediary as to such security entitlements, or (as the case may
be) to apply any value distributed on account of any commodity contract as
directed by the Collateral Agent to such commodity intermediary, in each case
without further consent of any Grantor or such nominee, or (ii) in the case
of financial assets (as governed by Article 8 of the New York UCC) or other
investment property held through a securities intermediary, arrange for the
Collateral Agent to become the entitlement holder with respect to such
investment property, with the Grantor being permitted, only with the consent of
the Collateral Agent, to exercise rights to withdraw or otherwise deal with such
investment property.  The Collateral Agent agrees with each of the
Grantors that the Collateral Agent shall not give any such entitlement orders or
instructions or directions to any such issuer, securities intermediary or
commodity intermediary, and shall not withhold its consent to the exercise of
any withdrawal or dealing rights by any Grantor, unless an Event of Default has
occurred and is continuing, or, after giving effect to any such investment and
withdrawal rights, would occur.  The provisions of this paragraph
shall not apply to any financial assets credited to a securities account for
which the Collateral Agent is the securities intermediary.


    
      
         


      

      
        24

        
          

        

      

      
         


      

    


    (e)  Electronic Chattel Paper and
Transferable Records.  If any Grantor at any time holds or
acquires an interest in any electronic chattel paper or any “transferable
record,” as that term is defined in Section 201 of the Federal Electronic
Signatures in Global and National Commerce Act, or in Section 16 of the
Uniform Electronic Transactions Act as in effect in any relevant jurisdiction,
such Grantor shall promptly notify the Collateral Agent thereof and shall take
such action as the Collateral Agent may reasonably request to vest in the
Collateral Agent control under New York UCC Section 9-105 of such
electronic chattel paper or control under Section 201 of the Federal
Electronic Signatures in Global and National Commerce Act or, as the case may
be, Section 16 of the Uniform Electronic Transactions Act, as so in effect
in such jurisdiction, of such transferable record.  The Collateral
Agent agrees with such Grantor that the Collateral Agent will arrange, pursuant
to procedures reasonably satisfactory to the Collateral Agent and so long as
such procedures will not result in the Collateral Agent’s loss of control, for
the Grantor to make alterations to the electronic chattel paper or transferable
record permitted under UCC Section 9-105 or, as the case may be,
Section 201 of the Federal Electronic Signatures in Global and National
Commerce Act or Section 16 of the Uniform Electronic Transactions Act for a
party in control to allow without loss of control, unless an Event of Default
has occurred and is continuing or would occur after taking into account any
action by such Grantor with respect to such electronic chattel paper or
transferable record.

     

    (f)  Letter-of-Credit
Rights.  If any Grantor is at any time a beneficiary under a
letter of credit now or hereafter issued in favor of such Grantor, such Grantor
shall promptly notify the Collateral Agent thereof and either (i) arrange
for the issuer and any confirmer of such letter of credit to consent to an
assignment to the Collateral Agent of the proceeds of any drawing under the
letter of credit or (ii) arrange for the Collateral Agent to become the
transferee beneficiary of the letter of credit, with the Collateral Agent
agreeing, in each case, that the proceeds of any drawing under the letter of
credit are to be paid to the applicable Grantor unless an Event of Default has
occurred or is continuing.

     

    (g)  Commercial Tort
Claims.  If any Grantor shall at any time hold or acquire a
commercial tort claim in an amount reasonably estimated to exceed $1,000,000,
the Grantor shall promptly notify the Collateral Agent thereof in a writing
signed by such Grantor, including a summary description of such claim, and grant
to the Collateral Agent in such writing a security interest therein and in the
proceeds thereof, all upon the terms of this Agreement.


    
      
         


      

      
        25

        
          

        

      

      
         


      

    


    SECTION
4.05.  Covenants Regarding Patent,
Trademark and Copyright Collateral.  (a)  Each
Grantor agrees that it will not do any act or omit to do any act (and will
exercise commercially reasonable efforts to prevent its licensees from doing any
act or omitting to do any act) whereby any Patent that is material to the
conduct of such Grantor’s business may become invalidated or dedicated to the
public, and agrees that it shall continue to mark any products covered by a
Patent with the relevant patent number as necessary and sufficient to establish
and preserve its maximum rights under applicable patent laws.

     

    (b)  Each
Grantor (either itself or through its licensees or its sublicensees) will, for
each Trademark material to the conduct of such Grantor’s business,
(i) maintain such Trademark in full force free from any claim of
abandonment or invalidity for non-use, (ii) maintain the quality of
products and services offered under such Trademark, (iii) display such
Trademark with notice of Federal or foreign registration to the extent
applicable and reasonably necessary and sufficient to establish and preserve its
maximum rights under applicable law and (iv) not knowingly use or knowingly
permit the use of such Trademark in violation of any third party
rights.

     

    (c)  Each
Grantor (either itself or through its licensees or sublicensees) will, for each
work covered by a Copyright material to the conduct of such Grantor’s business,
continue to publish, reproduce, display, adopt and distribute the work with
appropriate copyright notice as necessary and sufficient to establish and
preserve its maximum rights under applicable copyright laws.

     

    (d)  Each
Grantor shall notify the Collateral Agent promptly if it knows or reasonably
suspects that any Patent, Trademark or Copyright material to the conduct of such
Grantor’s business may become abandoned, lost or dedicated to the public, or of
any materially adverse determination or development (including the institution
of, or any determination or development in, any proceeding in the United States
Patent and Trademark Office, United States Copyright Office or any court or
similar office of any country) regarding such Grantor’s ownership of any such
Patent, Trademark or Copyright, its right to register the same, or its right to
keep and maintain the same.

     

    (e)  In
no event shall any Grantor, either itself or through any agent, employee,
licensee or designee, file an application for any Patent, Trademark or Copyright
(or for the registration of any Trademark or Copyright) with the United States
Patent and Trademark Office, United States Copyright Office or any office or
agency in any political subdivision of the United States or in any other country
or any political subdivision thereof, unless it promptly informs the Collateral
Agent, and executes and delivers any and all agreements, instruments, documents
and papers to evidence the Collateral Agent’s security interest in such Patent,
Trademark or Copyright, and each Grantor hereby appoints the Collateral Agent as
its attorney-in-fact to execute and file such writings for the foregoing
purposes, all lawful acts of such attorney being hereby ratified and confirmed;
such power, being coupled with an interest, is irrevocable.


    
      
         


      

      
        26

        
          

        

      

      
         


      

    


    (f)  Each
Grantor will take all necessary steps that are consistent with the practice in
any proceeding before the United States Patent and Trademark Office, United
States Copyright Office or any office or agency in any political subdivision of
the United States or in any other country or any political subdivision thereof,
to maintain and pursue each material application relating to the Patents,
Trademarks and/or Copyrights (and to obtain the relevant grant or registration)
and to maintain each issued Patent and each registration of the Trademarks and
Copyrights that is material to the conduct of any Grantor’s business, including
timely filings of applications for renewal, affidavits of use, affidavits of
incontestability and payment of maintenance fees, and, if consistent with such
Grantor’s reasonable business judgment, to initiate opposition, interference and
cancellation proceedings against third parties.

     

    (g)  In
the event that any Grantor knows or reasonably suspects that any Article 9
Collateral consisting of a Patent, Trademark or Copyright material to the
conduct of any Grantor’s business has been or is about to be infringed,
misappropriated or diluted by a third party, such Grantor promptly shall, if
consistent with such Grantor’s reasonable business judgment, promptly sue for
infringement, misappropriation or dilution and to recover any and all damages
for such infringement, misappropriation or dilution, and take such other actions
as are appropriate under the circumstances to protect such Article 9
Collateral.

     

    (h)  Upon
the occurrence and during the continuance of an Event of Default, each Grantor
shall use its commercially reasonable efforts to obtain all requisite consents
or approvals by the licensor of each Copyright License, Patent License or
Trademark License to effect the assignment of all such Grantor’s right, title
and interest thereunder to the Collateral Agent or its designee.

     

    (i)  Each
Grantor shall file with the United States Patent and Trademark Office or United
States Copyright Office (or any successor office or any similar office in any
other country) such documents as may be necessary or advisable for the purpose
of perfecting, confirming, continuing, enforcing or protecting the Security
Interest granted by each Grantor, naming any Grantor or the Grantors as debtors
and the Collateral Agent as secured party.  Each Grantor acknowledges
and agrees that the Collateral Agent shall have no duties with respect to making
any filings with the United States Patent and Trademark Office or United States
Copyright Office (or any successor office or any similar office in any other
country).


    
      
         


      

      
        27

        
          

        

      

      
         


      

    


    ARTICLE
V

     

    Remedies

     

    SECTION
5.01.  Remedies Upon
Default.  Upon the occurrence and during the continuance of an
Event of Default, it is agreed that the Collateral Agent shall have the right to
take any of or all the following actions at the same or different
times:  (a) with respect to any Article 9 Collateral
consisting of Intellectual Property, on demand, to cause the Security Interest
to become an assignment, transfer and conveyance of any of or all such Article 9
Collateral by the applicable Grantors to the Collateral Agent, or to license or
sublicense, whether general, special or otherwise, and whether on an exclusive
or nonexclusive basis, any such Article 9 Collateral throughout the world on
such terms and conditions and in such manner as the Collateral Agent shall
determine (other than in violation of any then-existing licensing arrangements
to the extent that waivers cannot be obtained), and (b) with or without
legal process and with or without prior notice or demand for performance, to
take possession of the Article 9 Collateral and without liability for trespass
to enter any premises where the Article 9 Collateral may be located for the
purpose of taking possession of or removing the Article 9 Collateral and,
generally, to exercise any and all rights afforded to a secured party under the
Uniform Commercial Code or other applicable law.  Without limiting the
generality of the foregoing, each Grantor agrees that the Collateral Agent shall
have the right, subject to the mandatory requirements of applicable law, to sell
or otherwise dispose of all or any part of the Collateral at a public or private
sale or at any broker’s board or on any securities exchange, for cash, upon
credit or for future delivery as the 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 without
representation, warranty or recourse.  Each such purchaser at any such
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.


    
      
         


      

      
        28

        
          

        

      

      
         


      

    


    The
Collateral Agent shall give the applicable Grantors 10 days’ written notice
(which each Grantor agrees is reasonable notice within the meaning of
Section 9-611 of the New York UCC or its equivalent in other
jurisdictions) of the 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 in its sole and absolute discretion
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, subject to
Section 5.02, 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 Obligations paid in full.  As an alternative to exercising the
power of sale herein 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 5.01 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.

     

    SECTION
5.02.  Application of
Proceeds.  The Collateral Agent shall apply the proceeds of any
collection or sale of, or foreclosure or other realization upon, any Collateral,
including any Collateral consisting of cash, as follows:

     

    FIRST, to the
payment of all costs and expenses incurred by the Collateral Agent in connection
with such collection or sale or otherwise in connection with this Agreement, any
other Indenture Document or any of the Obligations, including all court costs
and the fees and expenses of its agents and legal counsel, the repayment of all
advances made by the Collateral Agent hereunder or under any other Indenture
Document on behalf of any Grantor and any other costs or expenses incurred in
connection with the exercise of any right or remedy hereunder or under any other
Indenture Document;

     

    SECOND, to the
Trustee for any unpaid fees, expenses or indemnities;

     

    THIRD,
the payment in full of the Obligations (the amounts so applied to be distributed
among the Secured Parties pro rata in accordance with the amounts of the
Obligations owed to them on the date of any such distribution);
and


    
      
         


      

      
        29

        
          

        

      

      
         


      

    


    FOURTH, to the
Grantors, their successors or assigns, or as a court of competent jurisdiction
may otherwise direct.

     

    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.

     

    SECTION
5.03.  Grant
of License to Use Intellectual Property.  For the purpose of
enabling the Collateral Agent to exercise rights and remedies under this
Agreement at such time as the Collateral Agent shall be lawfully entitled to
exercise such rights and remedies, each Grantor hereby grants to the Collateral
Agent an irrevocable, nonexclusive license (exercisable without payment of
royalty or other compensation to the Grantors) to use, license or sublicense any
of the Article 9 Collateral consisting of Intellectual Property now owned
or hereafter acquired by such Grantor, and wherever the same may be located, and
including in such license access to all media in which any of the licensed items
may be recorded or stored and to all computer software and programs used for the
compilation or printout thereof.  The use of such license by the
Collateral Agent may be exercised, at the option of the Collateral Agent, only
upon the occurrence and during the continuation of an Event of Default; provided, that any
license, sublicense or other transaction entered into by the Collateral Agent in
accordance herewith shall be binding upon the Grantors notwithstanding any
subsequent cure of an Event of Default.

     

    SECTION
5.04.  Securities
Act.  In view of the position of the Grantors in relation to
the Pledged Collateral, or because of other current or future circumstances, a
question may arise under the Securities Act of 1933, as amended, as now or
hereafter in effect, or any similar statute hereafter enacted analogous in
purpose or effect (such Act and any such similar statute as from time to time in
effect being called the “Federal Securities
Laws”) with respect to any disposition of the Pledged Collateral
permitted hereunder.  Each Grantor understands that compliance with
the Federal Securities Laws might very strictly limit the course of conduct of
the Collateral Agent if the Collateral Agent were to attempt to dispose of all
or any part of the Pledged Collateral, and might also limit the extent to which
or the manner in which any subsequent transferee of any Pledged Collateral could
dispose of the same.  Similarly, there may be other legal restrictions
or limitations affecting the Collateral Agent in any attempt to dispose of all
or part of the Pledged Collateral under applicable “blue sky” or other state
securities laws or similar laws analogous in purpose or effect.  Each
Grantor recognizes that in light of such restrictions and limitations the
Collateral Agent may, with respect to any sale of the Pledged Collateral, limit
the purchasers to those who will agree, among other things, to acquire such
Pledged Collateral for their own account, for investment, and not with a view to
the distribution or resale thereof.  Each Grantor acknowledges and
agrees that in light of such restrictions and limitations, the Collateral Agent,
in its sole and absolute discretion (a) may proceed to make such a sale
whether or not a registration statement for the purpose of registering such
Pledged Collateral or part thereof shall have been filed under the Federal
Securities Laws and (b) may approach and negotiate with a single potential
purchaser to effect such sale.  Each Grantor acknowledges and agrees
that any such sale might result in prices and other terms less favorable to the
seller than if such sale were a public sale without such
restrictions.  In the event of any such sale, the Collateral Agent
shall incur no responsibility or liability for selling all or any part of the
Pledged Collateral at a price that the Collateral Agent, in its sole and
absolute discretion, may in good faith deem reasonable under the circumstances,
notwithstanding the possibility that a substantially higher price might have
been realized if the sale were deferred until after registration as aforesaid or
if more than a single purchaser were approached.  The provisions of
this Section 5.04 will apply notwithstanding the existence of a public or
private market upon which the quotations or sales prices may exceed
substantially the price at which the Collateral Agent sells.


    
      
         


      

      
        30

        
          

        

      

      
         


      

    

    SECTION
5.05.  Registration.  Each
Grantor agrees that, upon the occurrence and during the continuance of an Event
of Default, if for any reason the Collateral Agent desires to sell any of the
Pledged Collateral at a public sale, it will, at any time and from time to time,
upon the written request of the Collateral Agent, use its best efforts to
cooperate in any public sale effectuated by the Collateral Agent to permit the
public sale of such Pledged Collateral.  Each Grantor will bear all
costs and expenses of carrying out its obligations under this
Section 5.05.  Each Grantor acknowledges that there is no
adequate remedy at law for failure by it to comply with the provisions of this
Section 5.05 and that such failure would not be adequately compensable in
damages, and therefore agrees that its agreements contained in this
Section 5.05 may be specifically enforced.

     

    ARTICLE
VI

     

    Indemnity, Subrogation and
Subordination

     

    SECTION
6.01.  Indemnity and
Subrogation.  In addition to all such rights of indemnity and
subrogation as the Guarantors may have under applicable law (but subject to
Section 6.03), the Company agrees that (a) in the event a payment shall be
made by any Guarantor under this Agreement, the Company shall indemnify such
Guarantor for the full amount of such payment and such Guarantor shall be
subrogated to the rights of the Person to whom such payment shall have been made
to the extent of such payment and (b) in the event any assets of any
Grantor shall be sold pursuant to this Agreement or any other Collateral
Agreement 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
6.02.  Contribution and
Subrogation.  Each Guarantor and Grantor (a “Contributing Party”)
agrees (subject to Section 6.03) that, in the event a payment shall be made
by any other Guarantor hereunder in respect of any Obligation or assets of any
other Grantor shall be sold pursuant to any Collateral Agreement to satisfy any
Obligation owed to any Secured Party and such other Guarantor or Grantor (the
“Claiming
Party”) shall not have been fully indemnified by the Company as provided
in Section 6.01, the Contributing Party shall indemnify the Claiming Party
in an amount equal to the amount of such payment or the greater of the book
value or the fair market value of such assets, as the case may be, 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 Guarantors and Grantors on the date hereof (or, in the case
of any Guarantor or Grantor becoming a party hereto pursuant to
Section 7.14, the date of the supplement hereto executed and delivered by
such Guarantor or Grantor).  Any Contributing Party making any payment
to a Claiming Party pursuant to this Section 6.02 shall be subrogated to
the rights of such Claiming Party under Section 6.01 to the extent of such
payment.


    
      
         


      

      
        31

        
          

        

      

      
         


      

    

     

    SECTION
6.03.  Subordination.  (a)  Notwithstanding
any provision of this Agreement to the contrary, all rights of the Guarantors
and Grantors under Sections 6.01 and 6.02 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
Obligations.  No failure on the part of the Company or any Guarantor
or Grantor to make the payments required by Sections 6.01 and 6.02 (or any
other payments required under applicable law or otherwise) shall in any respect
limit the obligations and liabilities of any Guarantor or Grantor with respect
to its obligations hereunder, and each Guarantor and Grantor shall remain liable
for the full amount of the obligations of such Guarantor or Grantor
hereunder.

     

    (b)  Each
Guarantor and Grantor hereby agrees that all Indebtedness and other monetary
obligations owed by it to any other Guarantor, Grantor or any other Subsidiary
shall be fully subordinated to the indefeasible payment in full in cash of the
Obligations.

     

    ARTICLE
VII

     

    Miscellaneous

     

    SECTION
7.01.  Notices.  All
communications and notices hereunder shall (except as otherwise expressly
permitted herein) be in writing and given as provided in Section 12.02 of
the Indenture.  All communications and notices hereunder to any
Subsidiary Party shall be given to it in care of the Company as provided in
Section 12.02 of the Indenture.

     

    SECTION
7.02.  Waivers;
Amendment.  (a)  No failure or delay by the
Collateral Agent or any Noteholder in exercising any right or power hereunder or
under any other Indenture 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 the
Noteholders hereunder and under the other Indenture 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 Indenture Party shall in any event be effective unless the same
shall be permitted by paragraph (b) of this Section 7.02, 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 Indenture Party
in any case shall entitle any Indenture Party to any other or further notice or
demand in similar or other circumstances.

     

    
      
        
        

      

      
        32

        
          

        

      

      
        
        

      

    

     

    (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, the Indenture Party or Indenture Parties with respect to which
such waiver, amendment or modification is to apply, subject to any consent
required in accordance with Section 9.01 of the Indenture.

     

    SECTION
7.03.  Collateral Agent’s Fees and
Expenses; Indemnification.  (a)  The parties hereto
agree that the Collateral Agent shall be entitled to reimbursement of its
expenses incurred hereunder as provided in Section 7.07 of the
Indenture.

     

    (b)  Without
limitation of its indemnification obligations under the other Indenture
Documents, each Grantor and each Guarantor jointly and severally agrees to
indemnify the Collateral Agent against, and hold the Collateral Agent harmless
from, any and all losses, claims, damages, liabilities and related expenses,
including the reasonable fees, charges and disbursements of counsel for the
Collateral Agent, incurred by or asserted against the Collateral Agent arising
out of, in connection with, or as a result of, the execution, delivery or
performance of this Agreement or any claim, litigation, investigation or
proceeding relating to any of the foregoing agreement or instrument contemplated
hereby, or to the Collateral, whether or not the Collateral Agent is a party
thereto; provided, that such
indemnity shall not, as to the Collateral Agent, be available to the extent that
such losses, claims, damages, liabilities or related expenses are determined by
a court of competent jurisdiction by final and nonappealable judgment to have
resulted from the gross negligence or willful misconduct of the Collateral
Agent.

     

    (c)  Any
such amounts payable as provided hereunder shall be additional Obligations
secured hereby and by the other Collateral Agreements.  The provisions
of this Section 7.03 shall remain operative and in full force and effect
regardless of the termination of this Agreement or any other Indenture Document,
the consummation of the transactions contemplated hereby, the repayment of any
of the Obligations, the invalidity or unenforceability of any term or provision
of this Agreement or any other Indenture Document, or any investigation made by
or on behalf of the Collateral Agent or any other Secured Party.  All
amounts due under this Section 7.03 shall be payable on written demand
therefor.

     

    (d)  The
Collateral Agent shall be under no obligation to exercise any of the rights or
powers vested in it by this Agreement at the request or direction of the Trustee
(on behalf of Holders of a majority in principal amount of the Notes) or the
Holders of a majority in principal amount of the Notes, directly, unless the
Holders of a majority in principal amount of the Notes have offered to the
Collateral Agent security or indemnity satisfactory to the Collateral Agent
against the costs, expenses and liabilities that might be incurred by it in
compliance with such request or direction.

     

    
      
        
        

      

      
        33

        
          

        

      

      
        
        

      

    

     

    SECTION
7.04.  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 Guarantor, 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
7.05.  Survival of
Agreement.  All covenants, agreements, representations and
warranties made by the Indenture Parties in the Indenture Documents and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Indenture Document shall be considered
to have been relied upon by the Noteholders and the other Secured Parties at the
time made and shall survive the execution and delivery of the Indenture
Documents, regardless of any investigation made by any Noteholder or other
Secured Party or on its behalf at the time of the issuance of the Notes, and
shall continue in full force and effect as long as the principal of or any
accrued interest on the Notes or any fee or any other amount payable under any
Indenture Document is outstanding and unpaid.

     

    SECTION
7.06.  Counterparts; Effectiveness;
Several Agreement.  This Agreement may be executed in
counterparts, each of which shall constitute an original but all of which when
taken together shall constitute a single contract.  Delivery of an
executed signature page to this Agreement by facsimile or pdf (portable data
format) transmission shall be as effective as delivery of a manually signed
counterpart of this Agreement.  This Agreement shall become effective
as to any Indenture Party when a counterpart hereof executed on behalf of such
Indenture Party 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 Indenture Party and the Collateral
Agent and their respective permitted successors and assigns, and shall inure to
the benefit of such Indenture Party, the Collateral Agent and the other Secured
Parties and their respective successors and assigns, except that no Indenture
Party 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 Indenture Party and may be amended, modified,
supplemented, waived or released with respect to any Indenture Party without the
approval of any Indenture Party and without affecting the obligations of any
other Indenture Party hereunder.

     

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

     

    
      
        
        

      

      
        34

        
          

        

      

      
        
        

      

    

     

    SECTION
7.08.  Governing Law; Jurisdiction;
Consent to Service of Process.  (a)  This Agreement
shall be construed in accordance with and governed by the law of the State of
New York.


    (b)  Each
of the Indenture Parties hereby irrevocably and unconditionally submits, for
itself and its property, to the nonexclusive jurisdiction of the Supreme Court
of the State of New York sitting in New York County and of the United States
District Court of the Southern District of New York, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to this
Agreement or any other Indenture Document, or for recognition or enforcement of
any judgment, and each of the parties hereto hereby irrevocably and
unconditionally agrees that all claims in respect of any such action or
proceeding may be heard and determined in such New York State or, to the
extent permitted by law, in such Federal court.  Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law.  Nothing in this Agreement or any
other Indenture Document shall affect any right that the Collateral Agent or any
Noteholder may otherwise have to bring any action or proceeding relating to this
Agreement or any other Indenture Document against any Grantor or Guarantor, or
its properties in the courts of any jurisdiction.

     

    (c)  Each
of the Indenture Parties hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or any other Indenture Document in
any court referred to in paragraph (b) of this Section 7.08.  Each of
the parties hereto hereby irrevocably waives, to the fullest extent permitted by
law, the defense of an inconvenient forum to the maintenance of such action or
proceeding in any such court.

     

    (d)  Each
party to this Agreement irrevocably consents to service of process in the manner
provided for notices in Section 7.01.  Nothing in this Agreement
or any other Indenture Document will affect the right of any party to this
Agreement to serve process in any other manner permitted by law.

     

    SECTION
7.09.  WAIVER OF JURY
TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY
LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
AGREEMENT, ANY OTHER INDENTURE DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY
HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT,
IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION 7.09.


    
      
         


      

      
        35

        
          

        

      

      
         


      

    

     

    SECTION
7.10.  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
7.11.  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 and Guarantor hereunder shall be, subject to
the last paragraph of clause (a) of Section 4.01, absolute and unconditional
irrespective of (a) any lack of validity or enforceability of the
Indenture, any other Indenture Document, any agreement with respect to any of
the 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 Obligations, or any other amendment or
waiver of or any consent to any departure from the Indenture, any other
Indenture Document or any other agreement or instrument, (c) any exchange,
release or nonperfection 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 Obligations or (d) any other
circumstance that might otherwise constitute a defense available to, or a
discharge of, any Grantor or Guarantor in respect of the Obligations or this
Agreement.

     

    SECTION
7.12.  Termination or
Release.  (a)  This Agreement, the Guarantees made
herein, the Security Interest and all other security interests granted hereby
shall terminate as provided in the Indenture or when all the Obligations have
been indefeasibly paid in full.  In connection with any termination or
release pursuant to this paragraph, 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.  Any execution and delivery of documents pursuant to this
Section 7.13 shall be without recourse to or warranty by the Collateral
Agent.

     

    (b)  Release
of any Subsidiary Party from its obligations hereunder and of the Security
Interest in any Collateral shall be governed by Section 10.06 of the
Indenture.

     

    SECTION
7.13.  Additional
Subsidiaries.  Each Subsidiary of a Indenture Party that was
not in existence or not a Subsidiary on the date of the Indenture and is not a
Foreign Subsidiary is, unless otherwise provided in the Indenture, required to
enter in this Agreement as a Subsidiary Party upon becoming such a
Subsidiary.  Upon execution and delivery by the Collateral Agent and a
Subsidiary of an instrument in the form of Exhibit II hereto, such
Subsidiary shall become a Subsidiary Party hereunder with the same force and
effect as if originally named as a Subsidiary Party herein.  The
execution and delivery of any such instrument shall not require the consent of
any other Indenture Party hereunder.  The rights and obligations of
each Indenture Party hereunder shall remain in full force and effect
notwithstanding the addition of any new Indenture Party as a party to this
Agreement.


    
      
         


      

      
        36

        
          

        

      

      
         


      

    


    SECTION
7.14.  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 the Collateral Agent may deem necessary or advisable to accomplish the
purposes hereof, 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, 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 receivable 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; and (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; 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 accountable only for amounts actually received as a result of
the exercise of the powers granted to them herein, and neither they nor their
officers, directors, employees or agents shall be responsible to any Grantor for
any act or failure to act hereunder, except for their own gross negligence or
willful misconduct.

     

    SECTION
7.15.  Entire
Agreement.  In the event that the terms and provisions of this
Agreement conflict with any term or provision contained in the Indenture
Documents, the terms and provisions of the Indenture Documents shall govern and
control.

     

    [Signature
Page Follows]


    
      
         


      

      
        37

        
          

        

      

      
         


      

    


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

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  
                                                    
                                                      
                                                        
                                                          
                                                            
                                                              
                                                                
                                                                  
                                                                    
                                                                      
                                                                        	
                                                                                WOLVERINE
      TUBE, INC.

                                                                              
	 
      	 
      	 
      
	
                                                                                By:

                                                                              	/s/ 
      Harold M. Karp
	 
      	
                                                                                Name:  Harold
      M. Karp

                                                                              
	 
      	
                                                                                Title:  President
      and Chief

                                                                              
	Operating
      Officer 
	 
      	 
      	 
      
	
                                                                                U.S. BANK
      NATIONAL

                                                                                ASSOCIATION, as
      Collateral

                                                                                Agent

                                                                              
	 
      	 
      	 
      
	
                                                                                By:

                                                                              	/s/ 
      Paul L. Henderson  
	 
      	
                                                                                Name:
      Paul L. Henderson

                                                                              
	 
      	
                                                                                Title:
      Assistant Vice President

                                                                              
	 
      	 
      	 
      
	
                                                                                TF
      INVESTOR, INC.

                                                                              
	 
      	 
      	 
      
	
                                                                                By:

                                                                              	/s/ 
      Harold M. Karp  
	 
      	
                                                                                Name:  Harold
      M. Karp

                                                                              
	 
      	
                                                                                Title:  President

                                                                              
	 
      	 
      	 
      
	
                                                                                TUBE
      FORMING, L.P.

                                                                              
	
                                                                                By:
      Wolverine Tube, Inc. as General

                                                                                Partner

                                                                              
	 	 	 
	 
      	
                                                                                By:

                                                                              	/s/ 
      Harold M. Karp  
	 
      	 
      	
                                                                                Name:  Harold
      M. Karp

                                                                              
	 
      	 
      	
                                                                                Title:  President
      and Chief 

                                                                              
	Operating
      Officer
	 
      	 
      	 
      
	
                                                                                TUBE
      FORMING HOLDINGS,

                                                                                INC.

                                                                              
	 
      	 
      	 
      
	
                                                                                By:

                                                                              	/s/ 
      Harold M. Karp  
	 
      	 
      	
                                                                                Name:
      Harold M. Karp

                                                                              
	 
      	 
      	
                                                                                Title:
      President

                                                                              


                                                                      

                                                                    

                                                                  

                                                                

                                                              

                                                            

                                                          

                                                        

                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    


    
      
         


      

      
        38

        
          

        

      

      
         


      

    

     

    
      
        
          
            
              
                
                  
                    
                      	
                              WOLVERINE
      FINANCE, LLC

                            
	 
      	 
      
	
                              By:

                            	/s/ 
      Harold M. Karp  
	 
      	
                              Name:  Harold
      M. Karp

                            
	 
      	
                              Title:  Chief
      Manager

                            
	 
      	 
      
	
                              WOLVERINE
      PA, LLC

                            
	 
      	 
      
	
                              By:

                            	/s/ 
      Harold M. Karp  
	 
      	
                              Name:  Harold
      M. Karp

                            
	 
      	
                              Title:  President

                            
	 
      	 
      
	
                              WOLVERINE
      JOINING

                              TECHNOLOGIES,
      LLC

                            
	 
      	 
      
	
                              By:

                            	/s/ 
      Harold M. Karp  
	 
      	
                              Name:  Harold
      M. Karp

                            
	 
      	
                              Title:  President

                            


                    

                  

                

              

            

          

        

      

    


    
      
         


      

      
        39

        
          

        

      

      
         


      

    


    Schedule
I to

    the Gaurantee and

    Collateral Agreement

     

    SUBSIDIARY
PARTIES

     

    
      	
              1.

            	
              TF
      Investor, Inc.

            


    

    
      	
              2.

            	
              Tube
      Forming, L.P.

            


    

    
      	
              3.

            	
              Tube
      Forming Holdings, Inc.

            


    

    
      	
              4.

            	
              Wolverine
      Finance, LLC

            


    

    
      	
              5.

            	
              Wolverine
      PA, LLC

            


    

    
      	
              6.

            	
              Wolverine
      Joining Technologies, LLC

            


    

        

    
      
         


      

      
         


        
          

        

      

      
         


      

    


    
      Schedule
II to

      the
Guarantee and

      Collateral
Agreement

    

     

    EQUITY
INTERESTS

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  
                                    
                                      
                                        
                                          
                                            
                                              
                                                
                                                  

                                                    
                                                      
                                                         


                                                      

                                                      
                                                         


                                                        
                                                          

                                                        

                                                      

                                                      
                                                         


                                                      

                                                    

                                                  

                                                

                                              

                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

     

    
      Schedule
III to

      the
Guarantee and

      Collateral
Agreement

    

     

    INTELLECTUAL
PROPERTY

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Schedule
IV to

    the
Guarantee and

    Collateral
Agreement


    INSURANCE
REQUIREMENTS

     

    (a)  The
Company will, and will cause each Subsidiary Party to, maintain (or cause to be
maintained on its behalf), with financially sound and reputable insurance
companies:

     

                   (i)fire, boiler and machinery, and extended
coverage insurance, on a replacement cost basis, with respect to all personal
property and improvements to real property (in each case constituting
Collateral), in such amounts as are customarily maintained by companies in the
same or similar business operating in the same or similar
locations;

     

                   (ii)commercial general
liability insurance against claims for bodily injury, death or property damage
occurring upon, about or in connection with the use of any properties owned,
occupied or controlled by it, providing coverage on an occurrence basis with a
combined single limit of not less than $1,000,000 and including the broad form
CGL endorsement;

     

                   (iii)business
interruption insurance, insuring against loss of gross earnings for the agreed
upon aggregate amount of not less than $50,000,000 arising from any risks or
occurrences required to be covered by insurance pursuant to clause (i) above;
and

     

                   (iv)such other insurance as may be required by
law.

     

    Deductibles
or self-insured retention shall not exceed $250,000 for fire, boiler and
machinery and extended coverage policies, $250,000 for commercial general
liability policies or 2 times average daily value plus a 24-hour waiting period
for business interruption policies.

     

    (b)  Fire,
boiler and machinery and extended coverage policies maintained with respect to
any Collateral shall be endorsed or otherwise amended to include (i) a Secured
Party’s loss payable clause in favor of the Collateral Agent and providing for
losses thereunder to be payable to the Collateral Agent or its designee, (ii) a
provision to the effect that neither any Indenture Party, the Collateral Agent
nor any other party shall be a coinsurer and (iii) such other provisions as the
Collateral Agent may reasonably require from time to time to protect the
interests of the Secured Parties.  Commercial general liability
policies shall be endorsed to name the Collateral Agent as an additional
insured.  Business interruption policies shall name the Collateral
Agent as loss payee.  Each such policy referred to in this paragraph
also shall provide that it shall not be canceled, modified or not renewed (i) by
reason of nonpayment of premium except upon not less than 10 days’ prior written
notice thereof by the insurer to the Collateral Agent (giving the Collateral
Agent the right to cure defaults in the payment of premiums) or (ii) for any
other reason except upon not less than 30 days’ prior written notice thereof by
the insurer to the Collateral Agent.  The Company shall deliver to the
Collateral Agent, prior to the cancellation, modification or nonrenewal of any
such policy of insurance, evidence of the renewal or replacement policy (or
other evidence of renewal of a policy previously delivered to the Collateral
Agent) together with evidence reasonably satisfactory to the Collateral Agent of
payment of the premium therefore at such time payment is made.


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    
       

      Exhibit I
to

      the
Guarantee and

      Collateral
Agreement

    

     

    ABA MODEL
FORM OF DEPOSIT ACCOUNT CONTROL AGREEMENT

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
       

      Exhibit
II to the

      Guarantee
and

      Collateral
Agreement

    

     

    SUPPLEMENT
NO. __ dated as of
[           ] (this
“Supplement”),
to the Guarantee and Collateral Agreement, dated as of April 28, 2009, among
WOLVERINE TUBE, INC., a Delaware corporation (the “Company”), the
subsidiaries of the Company listed on Schedule I thereto (each such subsidiary
individually a “Subsidiary Guarantor”
and collectively, the “Subsidiary
Guarantors”; the Subsidiary Guarantors and the Company are referred to
collectively herein as the “Grantors”), and U.S.
BANK NATIONAL ASSOCIATION (“U.S. BANK”), as
Collateral Agent (in such capacity, the “Collateral
Agent”).

     

    A.  Reference
is made to the Indenture, dated as of April __, 2009 (as amended, supplemented
or otherwise modified from time to time, the “Indenture”), among
the Company, the Subsidiaries and U.S. BANK, as trustee and collateral
agent.

     

    B.  Capitalized
terms used herein and not otherwise defined herein shall have the meanings
assigned to such terms in the Indenture and the Security Agreement referred to
therein.

     

    C.  The
Grantors have entered into the Security Agreement in order to support the
issuance of the Notes.  Section 7.13 of Security Agreement provides
that additional Subsidiaries may become Subsidiary Parties under the Security
Agreement by execution and delivery of an instrument in the form of this
Supplement.  The undersigned Subsidiary (the “New Subsidiary”) is
executing this Supplement in accordance with the requirements of the Indenture
to become a Subsidiary Party under the Security Agreement in order to support
the issuance of the Notes.

     

    Accordingly,
the Collateral Agent and the New Subsidiary agree as follows:

     

    SECTION
1.  In accordance with Section 7.13 of the Security
Agreement, the New Subsidiary by its signature below becomes a Subsidiary Party
(and accordingly, becomes a Guarantor and Grantor), Grantor and Guarantor under
the Security Agreement with the same force and effect as if originally named
therein as a Subsidiary Party and the New Subsidiary hereby (a) agrees to all
the terms and provisions of the Security Agreement applicable to it as a
Subsidiary Party, Grantor and Guarantor thereunder and (b) represents and
warrants that the representations and warranties made by it as a Grantor and
Guarantor thereunder are true and correct in all material respects on and as of
the date hereof.  In furtherance of the foregoing, the New Subsidiary,
as security for the payment and performance in full of the Obligations (as
defined in the Security Agreement), does hereby create and grant to the
Collateral Agent, its successors and assigns, for the benefit of the Secured
Parties, their successors and assigns, a security interest in and lien on all of
the New Subsidiary’s right, title and interest in and to the Collateral (as
defined in the Security Agreement) of the New Subsidiary.  Each
reference to a “Guarantor” or “Grantor” in the Security Agreement shall be
deemed to include the New Subsidiary.  The Security Agreement is
hereby incorporated herein by reference.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    SECTION
2.  The New Subsidiary represents and warrants to the
Collateral Agent and the other Secured Parties that this Supplement has been
duly authorized, executed and delivered by it and constitutes its legal, valid
and binding obligation, enforceable against it in accordance with its
terms.

     

    SECTION
3.  This Supplement may be executed in counterparts (and by
different parties hereto on different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract. This Supplement shall become effective when the Collateral
Agent shall have received a counterpart of this Supplement that bears the
signature of the New Subsidiary and the Collateral Agent has executed a
counterpart hereof.  Delivery of an executed signature page to this
Supplement by facsimile transmission shall be as effective as delivery of a
manually signed counterpart of this Supplement.

     

    SECTION
4.  The New Subsidiary hereby represents and warrants that
(a) set forth on Schedule I attached hereto is a true and correct
schedule of the location of any and all Collateral of the New Subsidiary and
(b) set forth under its signature hereto, is the true and correct legal
name of the New Subsidiary, its jurisdiction of formation and the location of
its chief executive office.

     

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

     

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

     

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

     

    SECTION
8.  All communications and notices hereunder shall be in
writing and given as provided in Section 7.01 of the Security
Agreement.

     

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

     

    IN
WITNESS WHEREOF, the New Subsidiary and the Collateral Agent have duly executed
this Supplement to the Security Agreement as of the day and year first above
written.


    
      
         


      

      
        2

        
          

        

      

      
         


      

    

     

    
      
        
          	 	
                  [NAME
      OF NEW SUBSIDIARY],

                
	 	 
	 	
                  By:

                	 
      
	 	 
      	
                  Name:

                
	 	 
      	
                  Title:

                
	 	 
      	 
      
	 	 
      	
                  Legal
      Name:

                
	 	 
      	
                  Jurisdiction
      of Formation:

                
	 	 
      	
                  Location
      of Chief Executive
office:

                


        

      

    

     

    
      
        	 	
                U.S.
      BANK NATIONAL ASSOCIATION,

                as
      Collateral Agent

                 

              
	 	
                By:

              	 
      
	 	 
      	
                Name:

              
	 	 
      	
                Title:

              


      

    


    
      
         


      

      
        3

        
          

        

      

      
         


      

    

     

    Schedule
I

    to the
Supplement No. __ to the

    Guarantee
and

    Collateral
Agreement


    LOCATION
OF COLLATERAL

     

    
      
        
          
            
              
                
                  	
                          Description

                        	 	
                          Location

                        
	 
      	 	 
      
	 
      	 	 
      


                

              

            

          

        

      

    

    


    EQUITY
INTERESTS

     

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            	
                                    Issuer

                                  	 	
                                    Number
      of

                                    Certificate

                                  	 	
                                    Registered

                                    Owner

                                  	 	
                                    Number
      and

                                    Class
      of

                                    Equity Interests

                                  	 	
                                    Percentage

                                    of Equity Interests

                                  
	 
      	 	 
      	 	 
      	 	 
      	 	 
      
	 
      	 	 
      	 	 
      	 	 
      	 	 
      


                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    


    DEBT
SECURITIES

     

    
      
        
          
            
              
                
                  
                    
                      
                        	
                                Issuer

                              	 	
                                Principal

                                Amount

                              	 	
                                Date of Note

                              	 	
                                Maturity Date

                              
	 
      	 	 
      	 	 
      	 	 
      
	 
      	 	 
      	 	 
      	 	 
      


                      

                    

                  

                

              

            

          

        

      

    

    


    INTELLECTUAL
PROPERTY