Exhibit 4.2






Exhibit 4.2



EXECUTION VERSION



 

 


PLEDGE AND SECURITY AGREEMENT




by




AMBASSADORS INTERNATIONAL, INC.,




THE SUBSIDIARY GUARANTORS PARTY HERETO,




and




WILMINGTON TRUST FSB,

as Collateral Agent




 






Dated as of November 13, 2009



 

 




 












 









TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page	 
	 
	 	 	 	 
	ARTICLE I DEFINITIONS AND INTERPRETATION
	 	 	1	 
	 
	 	 	 	 
	SECTION 1.1. Definitions
	 	 	1	 
	 
	 	 	 	 
	ARTICLE II GRANT OF SECURITY AND SECURED OBLIGATIONS
	 	 	8	 
	 
	 	 	 	 
	SECTION 2.1. Grant of Security Interest
	 	 	8	 
	SECTION 2.2. Filings
	 	 	9	 
	 
	 	 	 	 
	ARTICLE III PERFECTION; SUPPLEMENTS; FURTHER ASSURANCES; USE OF PLEDGED
COLLATERAL
	 	 	10	 
	 
	 	 	 	 
	SECTION 3.1. Delivery of Certificated Securities Collateral
	 	 	10	 
	SECTION 3.2. Perfection of Uncertificated Securities Collateral
	 	 	10	 
	SECTION 3.3.
Financing Statements and Other Filings; Maintenance of Perfected
Security Interest
	 	 	10	 
	SECTION 3.4. Other Actions
	 	 	11	 
	SECTION 3.5. Joinder of Additional Subsidiary Guarantors
	 	 	14	 
	SECTION 3.6. Supplements; Further Assurances
	 	 	14	 
	 
	 	 	 	 
	ARTICLE IV REPRESENTATIONS, WARRANTIES AND COVENANTS
	 	 	15	 
	 
	 	 	 	 
	SECTION 4.1. Title
	 	 	15	 
	SECTION 4.2. Validity of Security Interest
	 	 	15	 
	SECTION 4.3. Defense of Claims; Transferability of Pledged Collateral
	 	 	15	 
	SECTION 4.4. Other Financing Statements
	 	 	16	 
	SECTION 4.5. Chief Executive Office; Change of Name; Jurisdiction of Organization
	 	 	16	 
	SECTION 4.6. Due Authorization and Issuance
	 	 	16	 
	SECTION 4.7. Consents, etc
	 	 	16	 
	SECTION 4.8. Pledged Collateral
	 	 	17	 
	SECTION 4.9. Insurance
	 	 	17	 
	SECTION 4.10. Defaults, etc
	 	 	17	 
	 
	 	 	 	 
	ARTICLE V CERTAIN PROVISIONS CONCERNING SECURITIES COLLATERAL
	 	 	17	 
	 
	 	 	 	 
	SECTION 5.1. Pledge of Additional Securities Collateral
	 	 	17	 
	SECTION 5.2. Voting Rights; Distributions, etc.
	 	 	17	 
	SECTION 5.3. Certain Agreements of Pledgors As Issuers and Holders of Capital Stock
	 	 	19	 
	 
	 	 	 	 
	ARTICLE VI CERTAIN PROVISIONS CONCERNING INTELLECTUAL PROPERTY COLLATERAL
	 	 	19	 






 


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	 	 	Page	 
	 
	SECTION 6.1. Grant of Intellectual Property License
	 	 	19	 
	SECTION 6.2. Protection of Collateral Agent’s Security
	 	 	19	 
	SECTION 6.3. After-Acquired Property
	 	 	20	 
	SECTION 6.4. Litigation
	 	 	20	 
	 
	 	 	 	 
	ARTICLE VII CERTAIN PROVISIONS CONCERNING RECEIVABLES
	 	 	21	 
	 
	 	 	 	 
	SECTION 7.1. Maintenance of Records
	 	 	21	 
	SECTION 7.2. Legend
	 	 	21	 
	SECTION 7.3. Modification of Terms, etc
	 	 	21	 
	SECTION 7.4. Collection
	 	 	21	 
	 
	 	 	 	 
	ARTICLE VIII TRANSFERS
	 	 	22	 
	 
	 	 	 	 
	SECTION 8.1. Transfers of Pledged Collateral
	 	 	22	 
	 
	 	 	 	 
	ARTICLE IX REMEDIES
	 	 	22	 
	 
	 	 	 	 
	SECTION 9.1. Remedies
	 	 	22	 
	SECTION 9.2. Notice of Sale
	 	 	24	 
	SECTION 9.3. Waiver of Notice and Claims
	 	 	24	 
	SECTION 9.4. Certain Sales of Pledged Collateral
	 	 	24	 
	SECTION 9.5. No Waiver; Cumulative Remedies
	 	 	25	 
	SECTION 9.6. Certain Additional Actions Regarding Intellectual Property
	 	 	26	 
	 
	 	 	 	 
	ARTICLE X APPLICATION OF PROCEEDS
	 	 	26	 
	 
	 	 	 	 
	SECTION 10.1. Application of Proceeds
	 	 	26	 
	 
	 	 	 	 
	ARTICLE XI MISCELLANEOUS
	 	 	27	 
	 
	 	 	 	 
	SECTION 11.1. Concerning Collateral Agent
	 	 	27	 
	SECTION 11.2. Collateral Agent May Perform; Collateral Agent Appointed Attorney-in-Fact
	 	 	29	 
	SECTION 11.3. Continuing Security Interest; Assignment
	 	 	30	 
	SECTION 11.4. Termination; Release
	 	 	30	 
	SECTION 11.5. Modification in Writing
	 	 	30	 
	SECTION 11.6. Notices
	 	 	31	 
	SECTION 11.7. Governing Law
	 	 	31	 
	SECTION 11.8. Consent to Jurisdiction and Service of Process; Waiver of Jury Trial
	 	 	31	 
	SECTION 11.9. Severability of Provisions
	 	 	32	 
	SECTION
11.10. Execution in Counterparts
	 	 	32	 
	SECTION 11.11. Business Days
	 	 	32	 
	SECTION 11.12. No Credit for Payment of Taxes or Imposition
	 	 	32	 
	SECTION 11.13. No Claims Against Collateral Agent
	 	 	32	 
	SECTION 11.14. No Release
	 	 	32	 
	SECTION 11.15. Obligations Absolute
	 	 	33	 






 


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	 	 	Page	 
	 
	SECTION 11.16. Joint and Several Liability
	 	 	33	 
	SECTION 11.17. Intercreditor Agreement
	 	 	34	 
	SECTION 11.18. Post Closing Collateral Matters
	 	 	34	 
	 
	 	 	 	 
	EXHIBIT 1 — Form of Copyright Security Agreement
	 	 	 	 
	 
	 	 	 	 
	EXHIBIT 2 — Form of Joinder Agreement
	 	 	 	 
	 
	 	 	 	 
	EXHIBIT 3 — Form of Patent Security Agreement
	 	 	 	 
	 
	 	 	 	 
	EXHIBIT 4 — Form of Control Agreement Concerning Securities Accounts
	 	 	 	 
	 
	 	 	 	 
	EXHIBIT 5 — Form of Trademark Security Agreement
	 	 	 	 
	 
	 	 	 	 
	EXHIBIT 6 — Form of Issuer’s Acknowledgment
	 	 	 	 
	 
	 	 	 	 
	EXHIBIT 7 — Form of Securities Pledge Amendment
	 	 	 	 
	 
	 	 	 	 
	EXHIBIT 8 — Form of Credit Card Notification
	 	 	 	 
	 
	 	 	 	 







 


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PLEDGE AND SECURITY AGREEMENT




This PLEDGE AND SECURITY AGREEMENT dated as of November 13, 2009 (as amended, amended and
restated, supplemented or otherwise modified from time to time in accordance with the provisions
hereof, this “Agreement”) made by AMBASSADORS INTERNATIONAL, INC., a Delaware corporation
(the “Company”), and the Subsidiary Guarantors (as defined in the Indenture referred to
below) from time to time party hereto, as pledgors, assignors and debtors (the Company and together
with the Subsidiary Guarantors, in such capacities and together with any successors in such
capacities, the “Pledgors,” and each, a “Pledgor”), in favor of WILMINGTON TRUST
FSB, in its capacity as collateral agent (in such capacity, the “Collateral Agent”).



R E C I T A L S:




WHEREAS, the Company, the Subsidiary Guarantors and the Collateral Agent, among other parties,
have, in connection with the execution and delivery of this Agreement, entered into that certain
Indenture, dated as of November 13, 2009 (as amended, amended and restated, supplemented or
otherwise modified from time to time in accordance with its terms, the “Indenture”)
providing for the issuance of the Company’s 10% Senior Secured Notes due 2012 (the
“Notes”);



WHEREAS, it is a condition to the effectuation of the Indenture that each Pledgor execute and
deliver the applicable Note Documents, including this Agreement; and



WHEREAS, this Agreement is given by each Pledgor in favor of the Collateral Agent for the
benefit of the Holders to secure the payment and performance of all of the Obligations.



A G R E E M E N T:




NOW THEREFORE, in consideration of the foregoing premises and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, each Pledgor and the
Collateral Agent hereby agree as follows:



ARTICLE I




DEFINITIONS AND INTERPRETATION





SECTION 1.1. Definitions.



(a) Terms used but not otherwise defined herein that are defined in the Indenture shall have
the meanings given to them in the Indenture.



(b) Unless otherwise defined herein or in the Indenture, capitalized terms used herein that
are defined in the UCC shall have the meanings assigned to them in the UCC; provided that
in any event, the following terms shall have the meanings assigned to them in the UCC:



“Accounts”; “Bank”; “Chattel Paper”; “Commercial Tort Claim”;
“Commodity Account”; “Commodity Contract”; “Commodity Intermediary”;
“Documents”; “Electronic 


 


 









 





Chattel Paper”; “Entitlement Order”; “Equipment”; “Financial
Asset”; “Fixtures”; “Goods”; “Inventory”; “Investment
Property”; “Letter-of-Credit Rights”; “Letters of Credit”; “Money”;
“Payment Intangibles”; “Proceeds”; “Records”; “Securities Account”;
“Securities Intermediary”; “Supporting Obligations”; and “Tangible Chattel
Paper.”




(c) The following terms shall have the following meanings:



“Account Debtor” shall mean each person who is obligated on a Receivable or Supporting
Obligation related thereto.




“Agreement” shall have the meaning assigned to such term in the Preamble hereof.



“Collateral Agent” shall have the meaning assigned to such term in the Preamble
hereof.



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




“Company” shall have the meaning assigned to such term in the Preamble hereof.



“Contracts” shall mean, collectively, with respect to each Pledgor, all sale, service,
performance, equipment or property lease contracts, agreements and grants and all other contracts,
agreements or grants (in each case, whether written or oral, or third party or intercompany),
between such Pledgor and any third party, and all assignments, amendments, restatements,
supplements, extensions, renewals, replacements or modifications thereof.



“Control” shall mean (i) in the case of each Deposit Account, “control,” as such term
is defined in Section 9-104 of the UCC, and (ii) in the case of any Security or Security
Entitlement, “control,” as such term is defined in Section 8-106 of the UCC.



“Control Agreements” shall mean, collectively, any Deposit Account Control Agreements
and any Securities Account Control Agreements.



“Copyrights” shall mean, collectively, with respect to each Pledgor, all copyrights
(whether statutory or common law, whether established or registered in the United States or any
other country or any political subdivision thereof, whether registered or unregistered and whether
published or unpublished) and all copyright registrations and applications for registration made by
such Pledgor, in each case, whether now owned or hereafter created or acquired by or assigned to
such Pledgor, together with any and all (i) rights and privileges arising under applicable law with
respect to such Pledgor’s use of such copyrights, (ii) reissues, renewals, continuations and
extensions thereof and amendments thereto, (iii) income, fees, royalties, damages, claims and
payments now or hereafter due and/or payable with respect thereto, including damages and payments
for past, present or future infringements thereof, (iv) rights corresponding thereto throughout the
world and (v) rights to sue for past, present or future infringements thereof.



“Copyright Security Agreement” shall mean an agreement substantially in the form of
Exhibit 1 hereto.


 


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“Credit Card Issuer” shall mean any Person (other than a Pledgor) who issues or whose
members issue credit cards, including, without limitation, MasterCard or VISA bank credit or debit
cards or other bank credit or debit cards issued through MasterCard International, Inc., Visa,
U.S.A., Inc. or Visa International and American Express, Discover, Diners Club, Carte Blanche and
other non-bank credit or debit cards, including, without limitation, credit or debit cards issued
by or through American Express Travel Related Services Company, Inc. and Novus Services, Inc.



“Credit Card Notification” shall mean a Credit Card Notification substantially in the
form of Exhibit 8 hereto (or such other form as may be reasonably acceptable to the
Collateral Agent).



“Credit Card Processor” shall mean any servicing or processing agent or any factor or
financial intermediary who facilitates, services, processes or manages the credit authorization,
billing transfer and/or payment procedures with respect to any Borrower’s sales transactions
involving credit card or debit card purchases by customers using credit cards or debit cards issued
by any Credit Card Issuer.



“Credit Card Receivables” shall mean, collectively, all present and future rights of
Pledgors to payment from (a) any Credit Card Issuer or Credit Card Processor arising from sales of
goods or rendition of services to customers who have purchased such goods or services using a
credit or debit card, (b) any Credit Card Issuer or Credit Card Processor in connection with the
sale or transfer of Accounts arising pursuant to the sale of goods or rendition of services to
customers who have purchased such goods or services using a credit card or a debit card, including,
but not limited to, all amounts at any time due or to become due from any Credit Card Issuer or
Credit Card Processor pursuant to any arrangement between any Credit Card Processor and any
Pledgor.



“Deposit Accounts” shall mean, collectively, with respect to each Pledgor, (i) all
“deposit accounts” as such term is defined in the UCC of such Pledgor and all accounts and
sub-accounts relating to any of the foregoing accounts and (ii) all cash, funds, checks, notes and
instruments from time to time on deposit in any of the accounts or sub-accounts described in clause
(i) of this definition.



“Deposit Account Control Agreement” shall mean a Deposit Account control agreement
that is reasonably satisfactory to the Collateral Agent establishing the Collateral Agent’s Control
with respect to any Deposit Account.



“Distributions” shall mean, collectively, with respect to each Pledgor, all dividends,
cash, options, warrants, rights, instruments, distributions, returns of capital or principal,
income, interest, profits and other property, interests (debt or equity) or proceeds, including as
a result of a split, revision, reclassification or other like change of the Pledged Securities,
from time to time received, receivable or otherwise distributed to such Pledgor in respect of or in
exchange for any or all of the Pledged Securities or Intercompany Notes.




“Excluded Accounts” shall have the meaning set forth in Section 3.4(c).



“Excluded Deposit Account” shall have the meaning set forth in Section 3.4(b).


 


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“Excluded Securities Account” shall have the meaning set forth in Section
3.4(c).



“Foreign Subsidiary” shall mean a subsidiary that is organized or incorporated, as
appropriate, under the laws of a jurisdiction other than the United States or any state thereof or
the District of Columbia.



“General Intangibles” shall mean, collectively, with respect to each Pledgor, all
“general intangibles,” as such term is defined in the UCC, of such Pledgor and, in any event, shall
include (i) all of such Pledgor’s rights, title and interest in, to and under all Contracts and
insurance policies (including all rights and remedies relating to monetary damages, including
indemnification rights and remedies, and claims for damages or other relief pursuant to or in
respect of any Contract), (ii) all know-how and warranties relating to any of the Pledged
Collateral or the Mortgaged Property, (iii) any and all other rights, claims, choses-in-action and
causes of action of such Pledgor against any other person and the benefits of any and all
collateral or other security given by any other person in connection therewith, (iv) all
guarantees, endorsements and indemnifications on, or of, any of the Pledged Collateral, (v) all
lists, books, records, correspondence, ledgers, printouts, files (whether in printed form or stored
electronically), tapes and other papers or materials containing information relating to any of the
Pledged Collateral or any of the Mortgaged Property, including all customer or tenant lists,
identification of suppliers, data, plans, blueprints, specifications, designs, drawings,
appraisals, recorded knowledge, surveys, studies, engineering reports, test reports, manuals,
standards, processing standards, performance standards, catalogs, research data, computer and
automatic machinery software and programs and the like, accounting information pertaining to such
Pledgor’s operations or any of the Pledged Collateral or any of the Mortgaged Property and all
media in which or on which any of the information or knowledge or data or records may be recorded
or stored and all computer programs used for the compilation or printout of such information,
knowledge, records or data, (vi) all licenses, consents, permits, variances, certifications,
authorizations and approvals, however characterized, now or hereafter acquired or held by such
Pledgor, including building permits, certificates of occupancy, environmental certificates,
industrial permits or licenses and certificates of operation and (vii) all rights to reserves,
deferred payments, deposits, refunds, indemnification of claims and claims for tax or other refunds
against any Governmental Authority.



“Goodwill” shall mean, collectively, with respect to each Pledgor, the goodwill
connected with such Pledgor’s business including all goodwill connected with (i) the use of and
symbolized by any Trademark or Intellectual Property License concerning any Trademark in which such
Pledgor has any interest, (ii) all know-how, trade secrets, customer and supplier lists,
proprietary information, inventions, methods, procedures, formulae, descriptions, compositions,
technical data, drawings, specifications, name plates, catalogs, confidential information and the
right to limit the use or disclosure thereof by any person, pricing and cost information, business
and marketing plans and proposals, consulting agreements, engineering contracts and such other
assets which relate to such goodwill and (iii) all product lines of such Pledgor’s business.



“Indenture” shall have the meaning assigned to such term in the Recitals.


 


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“Instruments” shall mean, collectively, with respect to each Pledgor, all
“instruments,” as such term is defined in Article 9, rather than Article 3, of the UCC, and shall
include all promissory notes, drafts, bills of exchange or acceptances.



“Intellectual Property Collateral” shall mean, collectively, the Patents, Trademarks,
Copyrights, Intellectual Property Licenses and Goodwill.



“Intellectual Property Licenses” shall mean, collectively, with respect to each
Pledgor, all license and distribution agreements with, and covenants not to sue, any other party
with respect to any Patent, Trademark or Copyright or any other patent, trademark or copyright,
whether such Pledgor is a licensor or licensee, distributor or distributee under any such license
or distribution agreement, together with any and all (i) renewals, extensions, supplements and
continuations thereof, (ii) income, fees, royalties, damages, claims and payments now and hereafter
due and/or payable thereunder and with respect thereto including damages and payments for past,
present or future infringements or violations thereof, (iii) rights to sue for past, present and
future infringements or violations thereof and (iv) other rights to use, exploit or practice any or
all of the Patents, Trademarks or Copyrights or any other patent, trademark or copyright.



“Intercompany Notes” shall mean, with respect to each Pledgor, all intercompany notes
described in the Perfection Questionnaire and intercompany notes hereafter acquired by such Pledgor
and all certificates, instruments or agreements evidencing such intercompany notes, and all
assignments, amendments, restatements, supplements, extensions, renewals, replacements or
modifications thereof to the extent permitted pursuant to the terms hereof.




“Holders” shall have the meaning assigned to such term in the Indenture.



“Joinder Agreement” shall mean an agreement substantially in the form of Exhibit
2 hereto.



“Material Intellectual Property Collateral” shall mean any Intellectual Property
Collateral that is material (i) to the use and operation of the Pledged Collateral or Mortgaged
Property or (ii) to the business, results of operations, or condition, financial or otherwise, of
any Pledgor.



“Mortgaged Property” means the “Vessels” or the “Mortgaged Property” as defined in the
Mortgages.




“Notes” shall have the meaning assigned to such term in the Recitals.



“Note Documents” shall mean the Indenture, the Notes, this Agreement and the other
Security Documents.



“Organizational Documents” shall mean, with respect to any Person, (i) in the case of
any corporation, the certificate of incorporation or amalgamation and by-laws (or similar
documents) of such Person, (ii) in the case of any limited liability company, the certificate of
formation and operating agreement (or similar documents) of such Person, (iii) in the case of any
limited partnership, the certificate of formation and limited partnership agreement (or similar
documents) of such Person, (iv) in the case of any general partnership, the partnership agreement
(or similar document) of such Person, (v) with respect to any Foreign Subsidiary, the equivalent



 


5









 






of the foregoing in its jurisdiction of incorporation or organization, and (vi) in any other
case, the functional equivalent of the foregoing.



“Patents” shall mean, collectively, with respect to each Pledgor, all patents, and all
patent applications and registrations assigned to, or subject to an obligation that the same be
assigned to such Pledgor (whether established or registered or recorded in the United States or any
other country or any political subdivision thereof), together with any and all (i) rights and
privileges arising under applicable law with respect to such Pledgor’s use of rights under any
patents and/or patent applications, (ii) inventions and improvements described and claimed therein,
(iii) reissues, divisions, continuations, renewals, extensions and continuations-in-part thereof
and amendments thereto, (iv) income, fees, royalties, damages, claims and payments now or hereafter
due and/or payable thereunder and with respect thereto including damages and payments for past,
present or future infringements thereof, (v) rights corresponding thereto throughout the world and
(vi) rights to sue for past, present or future infringements thereof.



“Patent Security Agreement” shall mean an agreement substantially in the form of
Exhibit 3 hereto.



“Perfection Questionnaire” shall mean that certain perfection questionnaire dated
November 13, 2009 executed and delivered by each Pledgor in favor of the Collateral Agent, and each
other perfection questionnaire (which shall be in form and substance reasonably acceptable to the
Collateral Agent) executed and delivered by the applicable Subsidiary Guarantor in favor of the
Collateral Agent contemporaneously with the execution and delivery of each Joinder Agreement
executed in accordance with Section 3.5 hereof, in each case, as the same may be amended,
amended and restated, supplemented or otherwise modified from time to time in accordance with the
Indenture or upon the reasonable request of the Collateral Agent.



“Pledge Amendment” shall have the meaning assigned to such term in Section 5.1
hereof.



“Pledged Collateral” shall have the meaning assigned to such term in Section
2.1 hereof.



“Pledged Securities” shall mean, collectively, with respect to each Pledgor, (i) all
issued and outstanding Capital Stock of each issuer set forth on Schedule 5 to the Perfection
Questionnaire as being owned by such Pledgor and all options, warrants, rights, agreements and
additional Capital Stock of whatever class of any such issuer acquired by such Pledgor (including
by issuance), together with all rights, privileges, authority and powers of such Pledgor relating
to such Capital Stock in each such issuer or under any Organizational Document of each such issuer,
and the certificates, instruments and agreements representing such Capital Stock and any and all
interest of such Pledgor in the entries on the books of any financial intermediary pertaining to
such Capital Stock, (ii) all Capital Stock of any Subsidiary, which Capital Stock is hereafter
acquired by such Pledgor (including by issuance) and all options, warrants, rights, agreements and
additional Capital Stock of whatever class of any such Subsidiary acquired by such Pledgor
(including by issuance), together with all rights, privileges, authority and powers of such Pledgor
relating to such Capital Stock or under any Organizational Document of any such Subsidiary, and the
certificates, instruments and agreements representing such Capital Stock and any and all interest
of such Pledgor in the entries on the books of any financial intermediary pertaining to such
Capital Stock, from time to time acquired by such Pledgor in any manner, and


 


6









 





(iii) all Capital Stock issued in respect of the Capital Stock referred to in clause (i) or
(ii) upon any consolidation or merger of any issuer of such Capital Stock.




“Pledgor” shall have the meaning assigned to such term in the Preamble hereof.



“Receivables” shall mean all (i) Accounts, (ii) Chattel Paper, (iii) Payment
Intangibles, (iv) General Intangibles, (v) Instruments and (vi) to the extent not otherwise covered
above, all other rights to payment, whether or not earned by performance, for goods or other
property sold, leased, licensed, assigned or otherwise disposed of, or services rendered or to be
rendered, regardless of how classified under the UCC together with all of Pledgors’ rights, if any,
in any goods or other property giving rise to such right to payment and all Collateral Support and
Supporting Obligations related thereto and all Records relating thereto.



“Securities Account Control Agreement” shall mean an agreement substantially in the
form of Exhibit 4 hereto or such other form that is reasonably satisfactory to the
Collateral Agent establishing the Collateral Agent’s Control with respect to any Securities
Account.



“Securities Collateral” shall mean, collectively, the Pledged Securities, the
Intercompany Notes and the Distributions.



“Trademarks” shall mean, collectively, with respect to each Pledgor, all trademarks
(including service marks), slogans, logos, certification marks, trade dress, uniform resource
locations (URL’s), domain names, corporate names and trade names, whether registered or
unregistered, owned by or assigned to such Pledgor and all registrations and applications for the
foregoing (whether statutory or common law and whether established or registered in the United
States or any other country or any political subdivision thereof), and all Goodwill associated
therewith, now existing or hereafter adopted or acquired, together with any and all (i) rights and
privileges arising under applicable law with respect to such Pledgor’s use of any trademarks, (ii)
reissues, continuations, extensions and renewals thereof and amendments thereto, (iii) income,
fees, royalties, damages and payments now and hereafter due and/or payable thereunder and with
respect thereto, including damages, claims and payments for past, present or future infringements
thereof, (iv) rights corresponding thereto throughout the world and (v) rights to sue for past,
present and future infringements thereof.



“Trademark Security Agreement” shall mean an agreement substantially in the form of
Exhibit 5 hereto.



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



(d) Interpretation. Any of the terms defined herein may, unless the context otherwise
requires, be used in the singular or the plural, depending on the reference. References herein to


 


7









 






any Section, Appendix, Schedule or Exhibit shall be to a Section, an Appendix, a Schedule or
an Exhibit, as the case may be, hereof unless otherwise specifically provided. The use herein of
the word “include” or “including”, when following any general statement, term or matter, shall not
be construed to limit such statement, term or matter to the specific items or matters set forth
immediately following such word or to similar items or matters, whether or not non-limiting
language (such as “without limitation” or “but not limited to” or words of similar import) is used
with reference thereto, but rather shall be deemed to refer to all other items or matters that fall
within the broadest possible scope of such general statement, term or matter. The terms lease and
license shall include sub-lease and sub-license, as applicable. If any conflict or inconsistency
exists between this Agreement and the Indenture, the Indenture shall govern. All references herein
to provisions of the UCC shall include all successor provisions under any subsequent version or
amendment to any Article of the UCC.



(e) Perfection Questionnaire. The Collateral Agent, the Company and each Pledgor
agree that the Perfection Questionnaire, the schedules thereto, and all descriptions of Pledged
Collateral contained therein, as amended, supplemented or otherwise modified from time to time, are
and shall at all times remain a part of this Agreement.



ARTICLE II




GRANT OF SECURITY AND SECURED OBLIGATIONS




SECTION 2.1. Grant of Security Interest. As collateral security for the payment and
performance in full of all the Obligations, each Pledgor hereby pledges and grants to the
Collateral Agent for the benefit of the Holders, a lien on and security interest in all of the
right, title and interest of such Pledgor in, to and under the following property, wherever
located, and whether now existing or hereafter arising or acquired from time to time (collectively,
the “Pledged Collateral”):




(i) all Accounts, including, without limitation, Credit Card Receivables;




(ii) all Equipment, Goods, Inventory and Fixtures;


(iii) all Documents, Instruments and Chattel Paper;


(iv) all Letters of Credit and Letter-of-Credit Rights;




(v) all Securities Collateral;




(vi) all Investment Property;




(vii) all Intellectual Property Collateral;




(viii) all Commercial Tort Claims described on Schedule 11 to the Perfection
Questionnaire;




(ix) all General Intangibles;


 


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(x) all Money and all Deposit Accounts;




(xi) all Supporting Obligations;




(xii) all books and records relating to the Pledged Collateral; and




(xiii) to the extent not covered by clauses (i) through (xii) of this sentence, all
other personal property of such Pledgor, whether tangible or intangible, and all Proceeds
and products of each of the foregoing and all accessions to, substitutions and replacements
for, and rents, profits and products of, each of the foregoing, and any and all Proceeds of
any insurance, indemnity, warranty or guaranty payable to such Pledgor from time to time
with respect to any of the foregoing;




provided that, notwithstanding anything to the contrary in this Agreement, the
Pledged Collateral shall not include, and this Agreement shall not constitute a grant of a
security interest in, (a) any assets acquired after the Closing Date to the extent that, and
for so long as, granting a security interest in such assets would violate applicable law, or
(b) any assets of any Subsidiary of the Company that is not a Subsidiary Guarantor.



SECTION 2.2. Filings. (a) Each Pledgor hereby irrevocably authorizes the Collateral
Agent at any time and from time to time to file in any relevant jurisdiction any financing
statements (including fixture filings) and amendments thereto that contain the information required
by Article 9 of the Uniform Commercial Code of each applicable jurisdiction for the filing of any
financing statement or amendment relating to the Pledged Collateral, including (i) whether such
Pledgor is an organization, the type of organization and any organizational identification number
issued to such Pledgor, (ii) any financing or continuation statements or other documents without
the signature of such Pledgor where permitted by law, including the filing of a financing statement
describing the Pledged Collateral as “all assets of the Pledgor whether now existing or hereafter
arising” and (iii) in the case of a financing statement filed as a fixture filing or covering
Pledged Collateral constituting minerals or the like to be extracted or timber to be cut, a
sufficient description of the real property to which such Pledged Collateral relates. Each Pledgor
agrees to provide all information described in the immediately preceding sentence to the Collateral
Agent promptly upon request by the Collateral Agent.



(b) Each Pledgor hereby ratifies its authorization for the Collateral Agent to file in any
relevant jurisdiction any financing statements or amendments thereto relating to the Pledged
Collateral if filed prior to the date hereof in compliance with the restrictions set forth above in
Section 2.2(a).



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


 


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ARTICLE III




PERFECTION; SUPPLEMENTS; FURTHER ASSURANCES;

USE OF PLEDGED COLLATERAL




SECTION 3.1. Delivery of Certificated Securities Collateral. Subject to the terms of
any Intercreditor Agreement that may be in effect from time to time, each Pledgor represents and
warrants that all certificates, agreements or instruments representing or evidencing the Securities
Collateral in existence on the date hereof have been delivered to the Collateral Agent in suitable
form for transfer by delivery or accompanied by duly executed instruments of transfer or assignment
in blank and that the Collateral Agent has a perfected first priority security interest therein,
subject to Permitted Liens. Subject to the terms of any Intercreditor Agreement that may be in
effect from time to time, each Pledgor hereby agrees that all certificates, agreements or
instruments representing or evidencing Securities Collateral acquired by such Pledgor after the
date hereof shall promptly (but in any event within ten (10) Business Days after receipt thereof by
such Pledgor) be delivered to and held by or on behalf of the Collateral Agent pursuant hereto.
All certificated Securities Collateral shall be in suitable form for transfer by delivery or shall
be accompanied by duly executed instruments of transfer or assignment in blank, all in form and
substance satisfactory to the Collateral Agent. Subject to the terms of any Intercreditor
Agreement that may be in effect from time to time, the Collateral Agent shall have the right, at
any time upon the occurrence and during the continuance of any Event of Default, (a) to endorse,
assign or otherwise transfer to or to register in its name, its bailee or any of its nominees or
endorse for negotiation any or all of the Securities Collateral, without any indication that such
Securities Collateral is subject to the security interest hereunder, and (b) to exchange
certificates representing or evidencing Securities Collateral for certificates of smaller or larger
denominations.



SECTION 3.2. Perfection of Uncertificated Securities Collateral. Each Pledgor
represents and warrants that the Collateral Agent has a perfected first priority security interest
in all uncertificated Pledged Securities pledged by it hereunder that are in existence on the date
hereof, subject to Permitted Liens. Subject to Permitted Liens, each Pledgor hereby agrees that if
any of the Pledged Securities are at any time not evidenced by certificates of ownership, then each
applicable Pledgor shall, subject to the terms of any Intercreditor Agreement that may be in effect
from time to time, to the extent permitted by applicable law, (i) cause the issuer to execute and
deliver to the Collateral Agent an acknowledgment of the pledge of such Pledged Securities
substantially in the form of Exhibit 6 hereto, and (ii) upon request by the Collateral
Agent, cause such pledge to be recorded on the equityholder register or the books of the issuer,
execute any customary pledge forms or other documents necessary or appropriate to complete the
pledge and give the Collateral Agent the right to transfer such Pledged Securities under the terms
hereof.



SECTION 3.3. Financing Statements and Other Filings; Maintenance of Perfected Security
Interest. Each Pledgor represents and warrants that all financing statements, agreements,
instruments and other documents necessary to perfect the security interest granted by it to the
Collateral Agent in respect of the Pledged Collateral have been delivered to the Collateral Agent
in completed and, to the extent necessary or appropriate, duly executed form for filing in each
governmental, municipal or other office specified in Section 2(a) of the Perfection Questionnaire.
Each Pledgor agrees that at the sole cost and expense of the Pledgors, such



 


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Pledgor will maintain the security interest created by this Agreement in the Pledged
Collateral as a perfected first priority security interest subject only to the Permitted Liens,
except as otherwise expressly permitted by the Indenture and subject to the terms of any
Intercreditor Agreement that may be in effect from time to time.



SECTION 3.4. Other Actions. In order to further ensure the attachment, perfection and
priority of, and the ability of the Collateral Agent to enforce, the Collateral Agent’s security
interest in the Pledged Collateral, each Pledgor represents and warrants (as to itself) as follows
and agrees, in each case at such Pledgor’s own expense, to take the following actions with respect
to the following Pledged Collateral, subject to the terms of any Intercreditor Agreement that may
be in effect from time to time:



(a) Instruments and Chattel Paper. As of the date hereof, no amounts payable under or
in connection with any of the Pledged Collateral are evidenced by any Instrument or Tangible
Chattel Paper other than such Instruments and Tangible Chattel Paper listed in Schedule 6 to the
Perfection Questionnaire. As of the date hereof, each Instrument and each item of Tangible Chattel
Paper listed in Schedule 6 of the Perfection Questionnaire has been properly endorsed, assigned and
delivered to the Collateral Agent, accompanied by instruments of transfer or assignment duly
executed in blank. If any amount then payable under or in connection with any of the Pledged
Collateral shall be evidenced by any Instrument or Tangible Chattel Paper, and such amount,
together with (x) all amounts payable evidenced by any Instrument or Tangible Chattel Paper not
previously delivered to the Collateral Agent, (y) all amounts payable evidenced by Electronic
Chattel Paper or any “transferable record” (as described in subsection (d) below) in which the
Collateral Agent has not been vested control within the meaning of the statutes described in the
second sentence of subsection (d) below and (z) the aggregate amount of all Letters of Credit for
which the actions described in clause (i) and (ii) of subsection (e) below have not been taken
exceeds, $20,000 individually and $75,000 in the aggregate, the Pledgor acquiring such Instrument
or Tangible Chattel Paper shall promptly (but in any event within ten (10) Business Days after
receipt thereof) 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.



(b) Deposit Accounts. As of the date hereof, all Deposit Accounts of each Pledgor are
listed in Schedule 10 to the Perfection Questionnaire other than Deposit Accounts in which such
Pledgor holds less than $20,000 individually and $75,000 in the aggregate (the “Excluded
Deposit Accounts”). The Collateral Agent has a validly attached security interest in each such
Deposit Account, which security interest is a first priority security interest perfected by Control
in each such account other than the Excluded Deposit Accounts, subject to Permitted Liens. No
Pledgor shall hereafter establish and maintain any Deposit Account other than Excluded Deposit
Accounts, unless (i) it shall have given the Collateral Agent prior written notice of its intention
to establish such new Deposit Account with a Bank and (ii) such Bank and such Pledgor shall have
duly executed and delivered to the Collateral Agent a Deposit Account Control Agreement with
respect to such Deposit Account. No Pledgor shall grant Control of any Deposit Account to any
person other than the Collateral Agent, subject to Permitted Liens and the terms of the
Intercreditor Agreement, if any.


 


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(c) Investment Property. (i) As of the date hereof, no Pledgor has any Securities
Accounts or Commodity Accounts. No Pledgor shall hereafter establish any Commodity Account. No
Pledgor shall hereafter establish and maintain any Securities Account with any Securities
Intermediary other than Securities Accounts in which less than $20,000 individually and $75,000 in
the aggregate is held (the “Excluded Securities Accounts” and, together with the Excluded
Deposit Accounts, collectively, the “Excluded Accounts”), unless (x) it shall have given
the Collateral Agent prior written notice of its intention to establish such new Securities Account
with such Securities Intermediary, and (y) such Securities Intermediary and such Pledgor shall have
duly executed and delivered a Control Agreement with respect to such Securities Account. Each
Pledgor shall accept any cash and Investment Property in trust for the benefit of the Collateral
Agent and within five (5) Business Day of actual receipt thereof, deposit any and all cash and
Investment Property (other than any Investment Property pledged pursuant to clauses (ii)(1),
(iii)(1) or (iii)(3) below) received by it into a Deposit Account or Securities Account subject to
Collateral Agent’s Control or an Excluded Account. The Collateral Agent agrees with each Pledgor
that the Collateral Agent shall not give any Entitlement Orders or instructions or directions to
any issuer of uncertificated securities or Securities Intermediary, and shall not withhold its
consent to the exercise of any withdrawal or dealing rights by such Pledgor, 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 Section 3.4(c) shall not apply to
any Financial Assets credited to a Securities Account for which the Collateral Agent is the
Securities Intermediary. Subject to Permitted Liens, no Pledgor shall grant Control over any
Investment Property to any person other than the Collateral Agent.




(ii) If any Pledgor shall at any time hold or acquire any certificated securities
constituting Investment Property, such Pledgor shall promptly, but in any event within ten
(10) Business Days, (1) endorse, assign and deliver the same to the Collateral Agent,
accompanied by such instruments of transfer or assignment duly executed in blank, all in
form and substance reasonably satisfactory to the Collateral Agent or (2) deliver such
securities into a Securities Account with respect to which a Securities Account Control
Agreement is in effect in favor of the Collateral Agent.




(iii) If any Pledgor shall at any time own or acquire, directly or through a nominee,
any uncertificated securities constituting Investment Property, such Pledgor shall promptly
notify the Collateral Agent thereof and pursuant to an agreement in form and substance
satisfactory to the Collateral Agent, either (1) cause the issuer to agree to comply with
instructions from the Collateral Agent as to such securities, without further consent of any
Pledgor or such nominee, (2) cause a Security Entitlement with respect to such
uncertificated security to be held in a Securities Account with respect to which the
Collateral Agent has Control or (3) arrange for the Collateral Agent to become the
registered owner of such securities.




(iv) As between the Collateral Agent and the Pledgors, the Pledgors shall bear the
investment risk with respect to the Investment Property and Pledged Securities, and the risk
of loss of, damage to, or the destruction of the Investment Property and Pledged Securities,
whether in the possession of, or maintained as a Security Entitlement or deposit by, or
subject to the Control of, the Collateral Agent, a Securities Intermediary, a Commodity
Intermediary, any Pledgor or any other person; provided, however, that the


 


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foregoing shall not relieve or release any Securities Intermediary of its duties and
obligations to the Pledgors under any applicable Control Agreement or applicable laws.



(d) Electronic Chattel Paper and Transferable Records. As of the date hereof, no
amount under or in connection with any of the Pledged Collateral is evidenced by 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) other than such Electronic
Chattel Paper and transferable records listed in Schedule 6 to the Perfection Questionnaire. If
any amount payable under or in connection with any of the Pledged Collateral shall be evidenced by
any Electronic Chattel Paper or any transferable record exceeds $20,000 individually and $75,000 in
the aggregate, the Pledgor acquiring such Electronic Chattel Paper or transferable record 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 of such Electronic Chattel Paper under
Section 9-105 of the UCC 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 Pledgor that the Collateral Agent will arrange, pursuant to
procedures satisfactory to the Collateral Agent and so long as such procedures will not result in
the Collateral Agent’s loss of control, for the Pledgor to make alterations to the Electronic
Chattel Paper or transferable record permitted under Section 9-105 of the UCC 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 Pledgor with respect to such Electronic Chattel Paper or transferable
record.



(e) Letter-of-Credit Rights. If any Pledgor is at any time a beneficiary under a
Letter of Credit now or hereafter issued in an amount equal to $20,000 individually and $75,000 in
the aggregate, such Pledgor shall promptly notify the Collateral Agent thereof and such Pledgor
shall, at the request of the Collateral Agent, pursuant to an agreement in form and substance
reasonably satisfactory to the Collateral Agent, 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 such 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 applied as
provided in the Indenture.



(f) Commercial Tort Claims. As of the date hereof, each Pledgor hereby represents and
warrants that it holds no Commercial Tort Claims other than those listed in Schedule 11 to the
Perfection Questionnaire. If any Pledgor shall at any time hold or acquire a Commercial Tort Claim
in an amount reasonably estimated to exceed $250,000, such Pledgor shall immediately notify the
Collateral Agent in writing signed by such Pledgor of the brief details thereof 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, with such writing to be in form and substance reasonably satisfactory
to the Collateral Agent.


 


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(g) Motor Vehicles. Upon the request of the Collateral Agent, each Pledgor shall
deliver to the Collateral Agent originals of the certificates of title or ownership for the motor
vehicles (and any other Equipment covered by certificates of title or ownership) owned by it, with
the Collateral Agent listed as lienholder therein; provided, however, that no such
action shall be required if the fair market value of such vehicles or Equipment does not exceed
$20,000 individually and $75,000 in the aggregate.



(h) Intellectual Property. As of the date hereof, each Pledgor hereby represents and
warrants that it holds no Intellectual Property Collateral other than those listed in Schedule 9 to
the Perfection Questionnaire.



(i) Credit Card Receivables. Pledgors will use commercially reasonable efforts to
deliver to the Collateral Agent Credit Card Notifications executed by the Pledgors in respect of
all Credit Card Receivables. No Pledgor shall hereafter enter into any agreement with any Credit
Card Processor and/or Credit Card Issuer unless it shall have used its commercially reasonable
efforts to duly execute and deliver to the Collateral Agent a Credit Card Notification with respect
to such agreement. Unless an Event of Default has occurred and is continuing, the Collateral Agent
shall not deliver any notice or instruction pursuant to any Credit Card Notification.



SECTION 3.5. Joinder of Additional Subsidiary Guarantors. The Pledgors shall cause
each Subsidiary of the Company which, from time to time, after the date hereof shall be required to
pledge any assets to the Collateral Agent for the benefit of the Holders pursuant to the provisions
of the Indenture, to execute and deliver to the Collateral Agent (a) a Joinder Agreement
substantially in the form of Exhibit 2 hereto within thirty (30) days of the date on which
it was acquired or created and (b) a Perfection Questionnaire, in each case, within thirty (30)
days of the date on which it was acquired or created upon such execution and delivery, such
Subsidiary shall constitute a “Subsidiary Guarantor” and a “Pledgor” for all purposes hereunder
with the same force and effect as if originally named as a Subsidiary Guarantor and Pledgor herein.
The execution and delivery of such Joinder Agreement shall not require the consent of any Pledgor
hereunder. The rights and obligations of each Pledgor hereunder shall remain in full force and
effect notwithstanding the addition of any new Subsidiary Guarantor and Pledgor as a party to this
Agreement.



SECTION 3.6. Supplements; Further Assurances. Each Pledgor shall take such further
actions, and execute and/or deliver to the Collateral Agent such additional financing statements,
amendments, assignments, agreements, supplements, powers and instruments, as the Collateral Agent
may in its reasonable judgment deem necessary or appropriate in order to create, perfect, preserve
and protect the security interest in the Pledged Collateral as provided herein and the rights and
interests granted to the Collateral Agent hereunder, to carry into effect the purposes hereof or
better to assure and confirm the validity, enforceability and priority of the Collateral Agent’s
security interest in the Pledged Collateral or permit the Collateral Agent to exercise and enforce
its rights, powers and remedies hereunder with respect to any Pledged Collateral, including the
filing of financing statements, continuation statements and other documents (including this
Agreement) under the Uniform Commercial Code (or other similar laws) in effect in any jurisdiction
with respect to the security interest created hereby and the execution and delivery of Control
Agreements, all in form reasonably satisfactory to the Collateral Agent and in such offices
(including the United States Patent and Trademark Office and the United States



 


14









 






Copyright Office) wherever required by law to perfect, continue and maintain the validity,
enforceability and priority of the security interest in the Pledged Collateral as provided herein
and to preserve the other rights and interests granted to the Collateral Agent hereunder, as
against third parties, with respect to the Pledged Collateral. Without limiting the generality of
the foregoing, each Pledgor shall make, execute, endorse, acknowledge, file or refile and/or
deliver to the Collateral Agent from time to time upon reasonable request by the Collateral Agent,
such lists, schedules, descriptions and designations of the Pledged Collateral, copies of receipts,
bank statements, bills of lading, documents of title, vouchers, invoices, schedules, confirmatory
assignments, supplements, additional security agreements, conveyances, financing statements,
transfer endorsements, powers of attorney, certificates, reports and other assurances or
instruments as the Collateral Agent shall reasonably request. If an Event of Default has occurred
and is continuing, the Collateral Agent may institute and maintain, in its own name or in the name
of any Pledgor, such suits and proceedings as the Collateral Agent may be advised by counsel shall
be necessary or expedient to prevent any impairment of the security interest in or the perfection
thereof in the Pledged Collateral. All of the foregoing shall be at the sole cost and expense of
the Pledgors.



ARTICLE IV




REPRESENTATIONS, WARRANTIES AND COVENANTS




Each Pledgor represents, warrants and covenants as follows, subject to the terms of the
Intercreditor Agreement, if any:



SECTION 4.1. Title. Except for the security interest granted to the Collateral Agent
for the benefit of the Holders pursuant to this Agreement and Permitted Liens, such Pledgor owns
and has rights and, as to Pledged Collateral acquired by it from time to time after the date
hereof, will own and have rights in each item of Pledged Collateral pledged by it hereunder, free
and clear of any and all Liens or claims of others. In addition, no Liens or claims exist on the
Securities Collateral, other than as permitted by the Indenture and the Permitted Liens.



SECTION 4.2. Validity of Security Interest. The security interest in and the Lien on
the Pledged Collateral granted to the Collateral Agent for the benefit of the Holders hereunder
constitutes (a) a legal and valid security interest in all the Pledged Collateral securing the
payment and performance of the Obligations, and (b) a perfected security interest in all the
Pledged Collateral to the extent required hereunder. The security interest and the Lien granted to
the Collateral Agent for the benefit of the Holders pursuant to this Agreement in and on the
Pledged Collateral will at all times constitute a perfected, continuing security interest therein,
prior to all other Liens on the Pledged Collateral except for Permitted Liens.



SECTION 4.3. Defense of Claims; Transferability of Pledged Collateral. Subject to the
Indenture, each Pledgor shall, at its own cost and expense, defend title to the Pledged Collateral
pledged by it hereunder and the security interest therein and Lien thereon granted to the
Collateral Agent and the priority thereof against all claims and demands of all persons, at its own
cost and expense, at any time claiming any interest therein adverse to the Collateral Agent or any
other Holder other than Permitted Liens. There is no agreement, order, judgment or decree by or
against any Pledgor, and no Pledgor shall enter into any agreement or take any other action, that



 


15









 






would restrict the transferability of any of the Pledged Collateral or otherwise impair or
conflict with such Pledgor’s obligations or the rights of the Collateral Agent hereunder, other
than entering into, and as permitted by, the Intercreditor Agreement.



SECTION 4.4. Other Financing Statements. No Pledgor has filed, nor authorized any
third party to file (nor will there be), any valid or effective financing statement (or similar
statement, instrument of registration or public notice under the law of any jurisdiction) covering
or purporting to cover any interest of any kind in the Pledged Collateral, except such as have been
filed in favor of the Collateral Agent pursuant to this Agreement or in favor of any holder of a
Permitted Lien with respect to such Permitted Lien or financing statements or public notices
relating to termination statements. No Pledgor shall execute, authorize or permit to be filed in
any public office any financing statement (or similar statement, instrument of registration or
public notice under the law of any jurisdiction) relating to any Pledged Collateral, except
financing statements and other instruments filed or to be filed in respect of and covering the
security interests granted by such Pledgor to the holder of the Permitted Liens.



SECTION 4.5. Chief Executive Office; Change of Name; Jurisdiction of Organization.
Each Pledgor shall furnish to the Collateral Agent prior written notice of any change (i) in its
corporate, limited liability company or partnership name, (ii) in the location of its chief
executive office or its principal place of business (including the establishment of any such new
office or facility), (iii) in its organizational structure or (iv) in its Federal taxpayer
identification number or state organizational number. The Collateral Agent may rely on advice of
counsel as to whether any or all UCC financing statements of the Pledgors need to be amended as a
result of any of the changes described above. If any Pledgor fails to provide information to the
Collateral Agent about such changes on a timely basis, the Collateral Agent shall not be liable or
responsible to any party for any failure to maintain a perfected security interest in such
Pledgor’s property constituting Pledged Collateral, for which the Collateral Agent needed to have
information relating to such changes. The Collateral Agent shall have no duty to inquire about
such changes if any Pledgor does not inform the Collateral Agent of such changes, the parties
acknowledging and agreeing that it would not be feasible or practical for the Collateral Agent to
search for information on such changes if such information is not provided by any Pledgor.



SECTION 4.6. Due Authorization and Issuance. All of the Pledged Securities existing
on the date hereof have been, and to the extent any Pledged Securities are hereafter issued, such
Pledged Securities will be, upon such issuance, duly authorized, validly issued and, in the case of
Capital Stock of a corporation, fully paid and non-assessable. There is no amount or other
obligation owing by any Pledgor to any issuer of the Pledged Securities in exchange for or in
connection with the issuance of the Pledged Securities or any Pledgor’s status as a partner or a
member of any issuer of the Pledged Securities.



SECTION 4.7. Consents, etc. In the event that the Collateral Agent desires to
exercise any remedies, voting or consensual rights or attorney-in-fact powers set forth in this
Agreement and determines it necessary to obtain any approvals or consents of any Governmental
Authority or any other person therefor, then, upon the reasonable request of the Collateral Agent,
such Pledgor agrees to use its commercially reasonable efforts to assist and aid the Collateral
Agent to obtain as soon as practicable any necessary approvals or consents for the exercise of any
such remedies, rights and powers.


 


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SECTION 4.8. Pledged Collateral. All information set forth herein, including the
schedules hereto, and all information contained in any documents, schedules and lists heretofore
delivered to any Holder or the Collateral Agent, including the Perfection Questionnaire and the
schedules thereto, in connection with this Agreement, in each case, relating to the Pledged
Collateral, is accurate and complete in all material respects.



SECTION 4.9. Insurance. In the event that the proceeds of any insurance claim are
paid to any Pledgor after the Collateral Agent has exercised its right to foreclose after an Event
of Default, such Net Cash Proceeds shall be held in trust for the benefit of the Collateral Agent
and immediately after receipt thereof shall be paid to the Collateral Agent for application in
accordance with Article X of this Agreement.



SECTION 4.10. Defaults, etc. Such Pledgor is not in default in the payment of any
portion of any mandatory capital contribution, if any, required to be made under any agreement to
which such Pledgor is a party relating to the Pledged Securities pledged by it. No Securities
Collateral pledged by such Pledgor is subject to any defense, offset or counterclaim, nor have any
of the foregoing been asserted or alleged against such Pledgor by any person with respect thereto,
and as of the date hereof, there are no certificates, instruments, documents or other writings
(other than the Organizational Documents and certificates representing such Pledged Securities that
have been delivered to the Collateral Agent) which evidence any Pledged Securities of such Pledgor.



ARTICLE V




CERTAIN PROVISIONS CONCERNING SECURITIES COLLATERAL




SECTION 5.1. Pledge of Additional Securities Collateral. Each Pledgor shall, upon
obtaining any Pledged Securities or Intercompany Notes of any Person, accept the same in trust for
the benefit of the Collateral Agent and promptly (but in any event within ten (10) Business Days
after receipt thereof) deliver to the Collateral Agent a pledge amendment, duly executed by such
Pledgor, in substantially the form of Exhibit 7 hereto (each, a “Pledge
Amendment”), and the certificates and other documents required under Section 3.1 and
Section 3.2 hereof in respect of the additional Pledged Securities or Intercompany Notes
which are to be pledged pursuant to this Agreement, and confirming the attachment of the Lien
hereby created on and in respect of such additional Pledged Securities or Intercompany Notes. Each
Pledgor hereby authorizes the Collateral Agent to attach each Pledge Amendment to this Agreement
and agrees that all Pledged Securities or Intercompany Notes listed on any Pledge Amendment
delivered to the Collateral Agent shall for all purposes hereunder be considered Pledged
Collateral.




SECTION 5.2. Voting Rights; Distributions, etc. 




(a) So long as no Event of Default shall have occurred and be continuing:




(i) Each Pledgor shall be entitled to exercise any and all voting and other consensual
rights pertaining to the Securities Collateral or any part thereof for any purpose not
inconsistent with the terms or purposes hereof, the Indenture or any other document
evidencing the Obligations; provided, however, that no Pledgor shall in any


 


17









 






event exercise such rights in any manner which could reasonably be expected to have a
material adverse effect on the value of the Securities Collateral to the Collateral Agent
and the Holders.




(ii) Each Pledgor shall be entitled to receive and retain, and to utilize free and
clear of the Lien hereof, any and all Distributions, but only if and to the extent made in
accordance with the provisions of the Indenture; provided, however, that any
and all such Distributions consisting of rights or interests in the form of securities shall
be forthwith delivered to the Collateral Agent to hold as Pledged Collateral and shall, if
received by any Pledgor, be received in trust for the benefit of the Collateral Agent, be
segregated from the other property or funds of such Pledgor and be promptly (but in any
event within seven (7) Business Days after receipt thereof) delivered to the Collateral
Agent as Pledged Collateral in the same form as so received (with any necessary
endorsement).



(b) So long as no Event of Default shall have occurred and be continuing, the Collateral Agent
shall be deemed without further action or formality to have granted to each Pledgor all necessary
consents relating to voting rights and shall, if necessary, upon written request of any Pledgor and
at the sole cost and expense of the Pledgors, from time to time execute and deliver (or cause to be
executed and delivered) to such Pledgor all such instruments as such Pledgor may reasonably request
in order to permit such Pledgor to exercise the voting and other rights which it is entitled to
exercise pursuant to Section 5.2(a)(i) hereof and to receive the Distributions which it is
authorized to receive and retain pursuant to Section 5.2(a)(ii) hereof.



(c) Subject to the terms of any Intercreditor Agreement that may be in effect from time to
time, upon the occurrence and during the continuance of any Event of Default:




(i) Upon written notice from the Collateral Agent, all rights of each Pledgor to
exercise the voting and other consensual rights it would otherwise be entitled to exercise
pursuant to Section 5.2(a)(i) hereof shall immediately cease, and all such rights
shall thereupon become vested in the Collateral Agent, which shall thereupon have the sole
right to exercise such voting and other consensual rights.




(ii) All rights of each Pledgor to receive Distributions which it would otherwise be
authorized to receive and retain pursuant to Section 5.2(a)(ii) hereof shall
immediately cease and all such rights shall thereupon become vested in the Collateral Agent,
which shall thereupon have the sole right to receive and hold as Pledged Collateral such
Distributions.



(d) Each Pledgor shall, at its sole cost and expense, from time to time execute and deliver to
the Collateral Agent appropriate instruments as the Collateral Agent may request in order to permit
the Collateral Agent to exercise the voting and other rights which it may be entitled to exercise
pursuant to Section 5.2(a)(i) hereof and to receive all Distributions which it may be
entitled to receive under Section 5.2(a)(ii) hereof.



(e) All Distributions which are received by any Pledgor contrary to the provisions of
Section 5.2(a)(ii) hereof shall be received in trust for the benefit of the Collateral
Agent, shall be segregated from other funds of such Pledgor and shall promptly, but in any event
within ten (10)



 


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Business Days, be paid over to the Collateral Agent as Pledged Collateral in the same form as
so received (with any necessary endorsement).




SECTION 5.3. Certain Agreements of Pledgors As Issuers and Holders of Capital Stock.



(a) In the case of each Pledgor which is an issuer of Securities Collateral, such Pledgor
agrees to be bound by the terms of this Agreement relating to the Securities Collateral issued by
it and will comply with such terms insofar as such terms are applicable to it.



(b) In the case of each Pledgor which is a partner, shareholder or member, as the case may be,
in a partnership, limited liability company or other entity, such Pledgor hereby consents to the
extent required by the applicable Organizational Document to the pledge by each other Pledgor,
pursuant to the terms hereof, of the Pledged Securities in such partnership, limited liability
company or other entity and, upon the occurrence and during the continuance of an Event of Default,
to the transfer of such Pledged Securities to the Collateral Agent or its nominee and to the
substitution of the Collateral Agent or its nominee as a substituted partner, shareholder or member
in such partnership, limited liability company or other entity with all the rights, powers and
duties of a general partner, limited partner, shareholder or member, as the case may be.



ARTICLE VI




CERTAIN PROVISIONS CONCERNING INTELLECTUAL

PROPERTY COLLATERAL




SECTION 6.1. Grant of Intellectual Property License. Subject to the terms of any
Intercreditor Agreement that may be in effect from time to time, for the purpose of enabling the
Collateral Agent, upon the occurrence and during the continuance of an Event of Default, to
exercise rights and remedies under Article VIII hereof at such time as the Collateral Agent
shall be lawfully entitled to exercise such rights and remedies, and for no other purpose, each
Pledgor hereby grants to the Collateral Agent, to the extent assignable, an irrevocable (for so
long as such Event of Default is continuing), non-exclusive, royalty free, worldwide license or
(for third party rights) sublicense (subject to the Pledgor’s ability to grant such a sublicense)
to use, assign, license or sublicense any of the Intellectual Property Collateral now owned or
hereafter acquired by such Pledgor, wherever the same may be located, effective only upon the
occurrence and during the continuance of an Event of Default. Such license or sublicense shall
include access to all media in which any of the licensed items may be recorded or stored and to all
computer programs used for the compilation or printout hereof.



SECTION 6.2. Protection of Collateral Agent’s Security. On a continuing basis, each
Pledgor shall, at its sole cost and expense, (i) promptly following its becoming aware thereof,
notify the Collateral Agent if any application or registration for any Material Intellectual
Property will become forfeited, abandoned or dedicated to the public, or of any adverse
determination in any proceeding (other than actions issued in the ordinary course of seeking
registration) or the institution of any proceeding in any federal, state, local or foreign court or
administrative body or in the United States Patent and Trademark Office or the United States



 


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Copyright Office regarding any Material Intellectual Property Collateral, such Pledgor’s right
to register such Material Intellectual Property Collateral or its right to keep and maintain such
registration in full force and effect, (ii) not permit to lapse or become abandoned any Material
Intellectual Property Collateral, and not settle or compromise any pending or future litigation or
administrative proceeding with respect to any such Material Intellectual Property Collateral, in
either case except as shall be consistent with commercially reasonable business judgment, (iii)
diligently keep reasonable records respecting all Intellectual Property Collateral and (iv) furnish
to the Collateral Agent from time to time upon the Collateral Agent’s reasonable request therefor
reasonably detailed statements and amended schedules further identifying and describing the
Intellectual Property Collateral and such other materials evidencing or reports pertaining to any
Intellectual Property Collateral as the Collateral Agent may from time to time reasonably request.
Notwithstanding the foregoing, Pledgor may dispose of Intellectual Property Collateral as permitted
under the Indenture.



SECTION 6.3. After-Acquired Property. If any Pledgor shall at any time after the date
hereof (i) obtain any rights to any additional Intellectual Property Collateral or (ii) become
entitled to the benefit of any additional Intellectual Property Collateral or any renewal or
extension thereof, including any reissue, division, continuation, or continuation-in-part of any
Intellectual Property Collateral, or any improvement on any Intellectual Property Collateral, the
provisions hereof shall automatically apply thereto and any such item enumerated in the preceding
clause (i) or (ii) shall automatically constitute Intellectual Property Collateral as if such would
have constituted Intellectual Property Collateral at the time of execution hereof and be subject to
the Lien and security interest created by this Agreement without further action by any party. Each
Pledgor shall promptly provide to the Collateral Agent written notice of any of the foregoing and
confirm the attachment of the Lien and security interest created by this Agreement to any rights
described in clauses (i) and (ii) above by execution of an instrument in form reasonably acceptable
to the Collateral Agent and the filing of any instruments or statements as shall be reasonably
necessary to create, preserve, protect or perfect the Collateral Agent’s security interest in such
Intellectual Property Collateral. Further, each Pledgor authorizes the Collateral Agent to modify
this Agreement by amending Schedule 11 to the Perfection Questionnaire to include any Intellectual
Property Collateral of such Pledgor acquired or arising after the date hereof.



SECTION 6.4. Litigation. Unless there shall occur and be continuing any Event of
Default, each Pledgor shall have the right to commence and prosecute in its own name, as the party
in interest, for its own benefit and at the sole cost and expense of the Pledgors, such
applications for protection of the Intellectual Property Collateral and suits, proceedings or other
actions to prevent the infringement, counterfeiting, unfair competition, dilution, diminution in
value or other damage as are necessary to protect the Intellectual Property Collateral. Upon the
occurrence and during the continuance of any Event of Default, subject to the terms of any
Intercreditor Agreement that may be in effect from time to time, the Collateral Agent shall have
the right but shall in no way be obligated to file applications for protection of the Intellectual
Property Collateral and/or bring suit in the name of any Pledgor, the Collateral Agent or the
Holders to enforce the Intellectual Property Collateral and any license thereunder. In the event
of such suit, each Pledgor shall, at the reasonable request of the Collateral Agent, do any and all
lawful acts and execute any and all documents requested by the Collateral Agent in aid of such
enforcement and the Pledgors shall promptly reimburse and indemnify the Collateral Agent for



 


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all costs and expenses incurred by the Collateral Agent in the exercise of its rights under
this Section 6.4 in accordance with the Indenture. In the event that the Collateral Agent
shall elect not to bring suit to enforce the Intellectual Property Collateral, each Pledgor agrees,
at the reasonable request of the Collateral Agent, to take all commercially reasonable actions
necessary, whether by suit, proceeding or other action, to prevent the infringement,
counterfeiting, unfair competition, dilution, diminution in value of or other damage to any of the
Intellectual Property Collateral by any Person.



ARTICLE VII




CERTAIN PROVISIONS CONCERNING RECEIVABLES




SECTION 7.1. Maintenance of Records. Each Pledgor shall keep and maintain at its own
cost and expense reasonable and adequate records of each Receivable, in a manner consistent with
prudent business practice, including records of all payments received, all credits granted thereon,
all merchandise returned and all other documentation relating thereto. Each Pledgor shall, at such
Pledgor’s sole cost and expense, upon the Collateral Agent’s demand made at any time after the
occurrence and during the continuance of any Event of Default, deliver all tangible evidence of
Receivables, including all documents evidencing Receivables and any books and records relating
thereto to the Collateral Agent or to its representatives (copies of which evidence and books and
records may be retained by such Pledgor). Upon the occurrence and during the continuance of any
Event of Default, the Collateral Agent may transfer a full and complete copy of any Pledgor’s
books, records, credit information, reports, memoranda and all other writings relating to the
Receivables to and for the use by any person that has acquired or is contemplating acquisition of
an interest in the Receivables or the Collateral Agent’s security interest therein without the
consent of any Pledgor.



SECTION 7.2. Legend. Each Pledgor shall legend, at the request of the Collateral
Agent made at any time after the occurrence and during the continuance of an Event of Default and
in form and manner reasonably satisfactory to the Collateral Agent, the Receivables and the other
books, records and documents of such Pledgor evidencing or pertaining to the Receivables with an
appropriate reference to the fact that the Receivables have been assigned to the Collateral Agent
for the benefit of the Holders and that the Collateral Agent has a security interest therein.



SECTION 7.3. Modification of Terms, etc. No Pledgor shall rescind or cancel any
obligations evidenced by any Receivable or modify any term thereof or make any adjustment with
respect thereto except in the ordinary course of business consistent with prudent business
practice, or extend or renew any such obligations except in the ordinary course of business
consistent with prudent business practice or compromise or settle any dispute, claim, suit or legal
proceeding relating thereto or sell any Receivable or interest therein except in the ordinary
course of business consistent with prudent business practice without the prior written consent of
the Collateral Agent and except as otherwise provided in the Indenture. Each Pledgor shall timely
fulfill in all material respects all obligations on its part to be fulfilled under or in connection
with the Receivables.



SECTION 7.4. Collection. Each Pledgor shall cause to be collected from the Account
Debtor of each of the Receivables, as and when due in the ordinary course of business and



 


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consistent with prudent business practice (including Receivables that are delinquent, such
Receivables to be collected in accordance with commercially reasonable collection procedures), any
and all amounts owing under or on account of such Receivable, and apply forthwith upon receipt
thereof all such amounts as are so collected to the outstanding balance of such Receivable, except
that any Pledgor may, with respect to a Receivable, allow in the ordinary course of business (i) a
refund or credit due as a result of returned or damaged or defective merchandise and (ii) such
extensions of time to pay amounts due in respect of Receivables and such other modifications of
payment terms or settlements in respect of Receivables as shall be commercially reasonable in the
circumstances, all in accordance with such Pledgor’s ordinary course of business consistent with
its collection practices as in effect from time to time. The costs and expenses (including
attorneys’ fees) of collection, in any case, whether incurred by any Pledgor, the Collateral Agent
or any Holder, shall be paid by the Pledgors.



ARTICLE VIII




TRANSFERS




SECTION 8.1. Transfers of Pledged Collateral. No Pledgor shall sell, convey, assign
or otherwise dispose of, or grant any option with respect to, any of the Pledged Collateral pledged
by it hereunder except as expressly permitted by the Indenture or otherwise required by the
Intercreditor Agreement, if any.



ARTICLE IX




REMEDIES




SECTION 9.1. Remedies. Subject to the terms of any Intercreditor Agreement that may
be in effect from time to time, upon the occurrence and during the continuance of any Event of
Default, the Collateral Agent may from time to time exercise in respect of the Pledged Collateral,
in addition to the other rights and remedies provided for herein or otherwise available to it, the
following remedies:




(i) Personally, or by agents or attorneys, immediately take possession of the Pledged
Collateral or any part thereof, from any Pledgor or any other person who then has possession
of any part thereof with or without notice or process of law, and for that purpose and/or
sale or other disposition of the Pledged Collateral may enter upon any Pledgor’s premises
where any of the Pledged Collateral is located, remove such Pledged Collateral and/or sell
or otherwise dispose of the Pledged Collateral, remain present at such premises to receive
copies of all communications and remittances relating to the Pledged Collateral and for
other purposes set forth in this clause (i) and use in connection with such removal,
possession, sale or other disposition, any and all services, supplies, equipment, aids and
other facilities of any Pledgor;




(ii) Demand, sue for, collect or receive any money or property at any time payable or
receivable in respect of the Pledged Collateral including instructing the obligor or
obligors on any agreement, instrument or other obligation constituting part of the Pledged
Collateral to make any payment required by the terms of such agreement,


 


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instrument or other obligation directly to the Collateral Agent, and in connection with
any of the foregoing, compromise, settle, extend the time for payment and make other
modifications with respect thereto; provided, however, that in the event
that any such payments are made directly to any Pledgor, prior to receipt by any such
obligor of such instruction, such Pledgor shall segregate all amounts received pursuant
thereto in trust for the benefit of the Collateral Agent and shall promptly (but in no event
later than one (1) Business Day after receipt thereof) pay such amounts to the Collateral
Agent;




(iii) Sell, assign, grant a license to use or otherwise liquidate, or direct any
Pledgor to sell, assign, grant a license to use or otherwise liquidate, any and all
investments made in whole or in part with the Pledged Collateral or any part thereof, and
take possession of the proceeds of any such sale, assignment, license or liquidation;




(iv) Take possession of the Pledged Collateral or any part thereof, by directing any
Pledgor in writing to deliver the same to the Collateral Agent at any place or places so
designated by the Collateral Agent, in which event such Pledgor shall at its own expense:
(A) forthwith cause the same to be moved to the place or places designated by the Collateral
Agent and therewith delivered to the Collateral Agent, (B) store and keep any Pledged
Collateral so delivered to the Collateral Agent at such place or places pending further
action by the Collateral Agent and (C) while the Pledged Collateral shall be so stored and
kept, provide such security and maintenance services as shall be necessary to protect the
same and to preserve and maintain them in good condition. Each Pledgor’s obligation to
deliver the Pledged Collateral as contemplated in this Section 9.1(iv) is of the
essence hereof. Upon application to a court of equity having jurisdiction, the Collateral
Agent shall be entitled to a decree requiring specific performance by any Pledgor of such
obligation;




(v) Withdraw all moneys, instruments, securities and other property in any bank,
financial securities, deposit or other account of any Pledgor constituting Pledged
Collateral for application to the Obligations as provided in Article X hereof;




(vi) Retain and apply the Distributions to the Obligations as provided in Article
X hereof;




(vii) Exercise any and all rights as beneficial and legal owner of the Pledged
Collateral, including perfecting assignment of and exercising any and all voting, consensual
and other rights and powers with respect to any Pledged Collateral; and




(viii) Exercise all the rights and remedies of a secured party on default under the
UCC, and the Collateral Agent may also in its sole discretion, without notice except as
specified in Section 9.2 hereof, sell, assign or grant a license to use the Pledged
Collateral or any part thereof in one or more parcels at public or private sale, at any
exchange, broker’s board or at any of the Collateral Agent’s offices or elsewhere, for cash,
on credit or for future delivery, and at such price or prices and upon such other terms as
the Collateral Agent may deem commercially reasonable. The Collateral Agent or any other
Holder or any of their respective Affiliates may be the purchaser, licensee, assignee or
recipient of the Pledged Collateral or any part thereof at any such sale and shall be


 


23









 






entitled, for the purpose of bidding and making settlement or payment of the purchase
price for all or any portion of the Pledged Collateral sold, assigned or licensed at such
sale, to use and apply any of the Obligations owed to such person as a credit on account of
the purchase price of the Pledged Collateral or any part thereof payable by such person at
such sale. Each purchaser, assignee, licensee or recipient at any such sale shall acquire
the property sold, assigned or licensed absolutely free from any claim or right on the part
of any Pledgor, and each Pledgor hereby waives, to the fullest extent permitted by law, all
rights of redemption, stay and/or appraisal which it now has or may at any time in the
future have under any rule of law or statute now existing or hereafter enacted. The
Collateral Agent shall not be obligated to make any sale of the Pledged Collateral or any
part thereof regardless of notice of sale having been given. The Collateral Agent may
adjourn any public or private sale from time to time by announcement at the time and place
fixed therefor, and such sale may, without further notice, be made at the time and place to
which it was so adjourned. Each Pledgor hereby waives, to the fullest extent permitted by
law, any claims against the Collateral Agent arising by reason of the fact that the price at
which the Pledged Collateral or any part thereof may have been sold, assigned or licensed at
such a private sale was less than the price which might have been obtained at a public sale,
even if the Collateral Agent accepts the first offer received and does not offer such
Pledged Collateral to more than one offeree.



SECTION 9.2. Notice of Sale. Each Pledgor acknowledges and agrees that, to the extent
notice of sale or other disposition of the Pledged Collateral or any part thereof shall be required
by law, ten (10) days’ prior notice to such Pledgor of the time and place of any public sale or of
the time after which any private sale or other intended disposition is to take place shall be
commercially reasonable notification of such matters. No notification need be given to any Pledgor
if it has signed, after the occurrence of an Event of Default, a statement renouncing or modifying
any right to notification of sale or other intended disposition.



SECTION 9.3. Waiver of Notice and Claims. Each Pledgor hereby waives, to the fullest
extent permitted by applicable law, notice or judicial hearing in connection with the Collateral
Agent’s taking possession or the Collateral Agent’s disposition of the Pledged Collateral or any
part thereof, including any and all prior notice and hearing for any prejudgment remedy or remedies
and any such right which such Pledgor would otherwise have under law, and each Pledgor hereby
further waives, to the fullest extent permitted by applicable law: (i) all damages occasioned by
such taking of possession other than those caused by the Collateral Agent or its representatives or
agents, (ii) all other requirements as to the time, place and terms of sale or other requirements
with respect to the enforcement of the Collateral Agent’s rights hereunder and (iii) all rights of
redemption, appraisal, valuation, stay, extension or moratorium now or hereafter in force under any
applicable law. Any sale of, or the grant of options to purchase, or any other realization upon,
any Pledged Collateral shall operate to divest all right, title, interest, claim and demand, either
at law or in equity, of the applicable Pledgor therein and thereto, and shall be a perpetual bar
both at law and in equity against such Pledgor and against any and all Persons claiming or
attempting to claim the Pledged Collateral so sold, optioned or realized upon, or any part thereof,
from, through or under such Pledgor.



SECTION 9.4. Certain Sales of Pledged Collateral.


 


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(a) Each Pledgor recognizes that, by reason of certain prohibitions contained in law, rules,
regulations or orders of any Governmental Authority, the Collateral Agent may be compelled, with
respect to any sale of all or any part of the Pledged Collateral, to limit purchasers to those who
meet the requirements of such Governmental Authority. Each Pledgor acknowledges that any such
sales may be at prices and on terms less favorable to the Collateral Agent than those obtainable
through a public sale without such restrictions, and, notwithstanding such circumstances, agrees
that any such restricted sale shall be deemed to have been made in a commercially reasonable manner
and that, except as may be required by applicable law, the Collateral Agent shall have no
obligation to engage in public sales.



(b) Each Pledgor recognizes that, by reason of certain prohibitions contained in the
Securities Act, and applicable state securities laws, the Collateral Agent may be compelled, with
respect to any sale of all or any part of the Securities Collateral and Investment Property, to
limit purchasers to persons who will agree, among other things, to acquire such Securities
Collateral or Investment Property for their own account, for investment and not with a view to the
distribution or resale thereof. Each Pledgor acknowledges that any such private sales may be at
prices and on terms less favorable to the Collateral Agent than those obtainable through a public
sale without such restrictions (including a public offering made pursuant to a registration
statement under the Securities Act), and, notwithstanding such circumstances, agrees that any such
private sale shall be deemed to have been made in a commercially reasonable manner and that the
Collateral Agent shall have no obligation to engage in public sales and no obligation to delay the
sale of any Securities Collateral or Investment Property for the period of time necessary to permit
the issuer thereof to register it for a form of public sale requiring registration under the
Securities Act or under applicable state securities laws, even if such issuer would agree to do so.



(c) If the Collateral Agent determines to exercise its right to sell any or all of the
Securities Collateral or Investment Property, upon written request, the applicable Pledgor shall
from time to time furnish to the Collateral Agent all such information as the Collateral Agent may
request in order to determine the number of securities included in the Securities Collateral or
Investment Property which may be sold by the Collateral Agent as exempt transactions under the
Securities Act and the rules of the Securities and Exchange Commission thereunder, as the same are
from time to time in effect.



(d) Each Pledgor further agrees that a breach of any of the covenants contained in this
Section 9.4 will cause irreparable injury to the Collateral Agent and the other Holders,
that the Collateral Agent and the other Holders have no adequate remedy at law in respect of such
breach and, as a consequence, that each and every covenant contained in this Section 9.4
shall be specifically enforceable against such Pledgor, and such Pledgor hereby waives and agrees
not to assert any defenses against an action for specific performance of such covenants except for
a defense that no Event of Default has occurred and is continuing.




SECTION 9.5. No Waiver; Cumulative Remedies.



(a) No failure on the part of the Collateral Agent to exercise, no course of dealing with
respect to, and no delay on the part of the Collateral Agent in exercising, any right, power or
remedy hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of



 


25









 






any such right, power, privilege or remedy hereunder preclude any other or further exercise
thereof or the exercise of any other right, power, privilege or remedy; nor shall the Collateral
Agent be required to look first to, enforce or exhaust any other security, collateral or
guaranties. All rights and remedies herein provided are cumulative and are not exclusive of any
rights or remedies provided by law or otherwise available.



(b) In the event that the Collateral Agent shall have instituted any proceeding to enforce any
right, power, privilege or remedy under this Agreement or any other Note Document by foreclosure,
sale, entry or otherwise, and such proceeding shall have been discontinued or abandoned for any
reason or shall have been determined adversely to the Collateral Agent, then and in every such
case, the Pledgors, the Collateral Agent and each other Holder shall be restored to their
respective former positions and rights hereunder with respect to the Pledged Collateral, and all
rights, remedies, privileges and powers of the Collateral Agent and the other Holders shall
continue as if no such proceeding had been instituted.



SECTION 9.6. Certain Additional Actions Regarding Intellectual Property. If any Event
of Default shall have occurred and be continuing, upon the written demand of the Collateral Agent,
each Pledgor shall execute and deliver to the Collateral Agent an assignment or assignments of the
registered Patents, Trademarks and/or Copyrights and Goodwill and such other documents as are
necessary or appropriate to carry out the intent and purposes hereof. Within ten (10) Business
Days of written notice thereafter from the Collateral Agent, each Pledgor shall make available to
the Collateral Agent, to the extent within such Pledgor’s power and authority, such personnel in
such Pledgor’s employ on the date of the Event of Default as the Collateral Agent may reasonably
designate to permit such Pledgor to continue, directly or indirectly, to produce, advertise and
sell the products and services sold by such Pledgor under the registered Patents, Trademarks and/or
Copyrights, and such persons shall be available to perform their prior functions on the Collateral
Agent’s behalf.



ARTICLE X




APPLICATION OF PROCEEDS




SECTION 10.1. Application of Proceeds. The Collateral Agent shall apply the proceeds
received by the Collateral Agent in respect of any sale of, collection from or other realization
upon all or any part of the Pledged Collateral pursuant to the exercise by the Collateral Agent of
its remedies, together with any other sums then held by the Collateral Agent pursuant to this
Agreement, as follows:



FIRST, to the payment of all costs and expenses incurred by the Collateral Agent in connection
with such collection, sale or realization or otherwise in connection with this Agreement, any Note
Document or any of the Obligations, including without limitation 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 Note Document on behalf of any Pledgor, any other costs or
expenses incurred in connection with the exercise of any right or remedy hereunder or under any
other Note Document, and all other fees, indemnities and other amounts owing or reimbursable to the
Collateral Agent under any Note Document in its capacity as Collateral Agent or as Trustee;


 


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SECOND, to interest due in respect of the Obligations which such Pledged Collateral secures;




THIRD, to the principal of the Obligations which such Pledged Collateral secures; and



FOURTH, to the Pledgors, 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 Pledged
Collateral by the Collateral Agent (including pursuant to a power of sale granted by statute or
under a judicial proceeding), the receipt of the purchase money by the Collateral Agent or of the
officer making the sale shall be a sufficient discharge to the purchaser or purchasers of the
Pledged Collateral so sold and such purchaser or purchasers shall not be obligated to see to the
application of any part of the purchase money paid over to the Collateral Agent or such officer or
be answerable in any way for the misapplication thereof.



ARTICLE XI




MISCELLANEOUS





SECTION 11.1. Concerning Collateral Agent.



(a) The Collateral Agent has been appointed as collateral agent pursuant to the Indenture. The
actions of the Collateral Agent hereunder are subject to the provisions of the Indenture. The
Collateral Agent shall have the right hereunder to make demands, to give notices, to exercise or
refrain from exercising any rights, and to take or refrain from taking action (including the
release or substitution of the Pledged Collateral), in accordance with this Agreement and the
Indenture. Notwithstanding anything to the contrary contained herein, the Collateral Agent shall
be accountable only for amounts that it actually receives as a result of the exercise of such
powers, and neither the Collateral Agent or any of its Affiliates, nor any of the representatives
or agents of the Collateral Agent or any such Affiliate, shall be liable to any Pledgor for any
action taken or omitted to be taken by any of them under or in connection with this Agreement in
the absence of gross negligence or willful misconduct on the part of the Collateral Agent such
representative or agent, as determined by a final, non-appealable order of a court of competent
jurisdiction. The Collateral Agent may employ agents and attorneys-in-fact in connection herewith
and shall only be liable for the gross negligence or willful misconduct of any such agents or
attorneys-in-fact selected by it in good faith, as determined by a final, non-appealable order of a
court of competent jurisdiction. The Collateral Agent may resign and a successor Collateral Agent
may be appointed in the manner provided in the Indenture. Upon the acceptance of any appointment
as the Collateral Agent by a successor Collateral Agent, that successor Collateral Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges and duties of the
retiring Collateral Agent under this Agreement, and the retiring Collateral Agent shall thereupon
be discharged from its duties and obligations under this Agreement. After any retiring Collateral
Agent’s resignation, the provisions hereof shall inure to its benefit as to any actions taken or
omitted to be taken by it under this Agreement while it was the Collateral Agent.


 


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(b) The Collateral Agent shall be deemed to have exercised reasonable care in the custody and
preservation of the Pledged Collateral in its possession if such Pledged Collateral is accorded
treatment substantially equivalent to that which the Collateral Agent, in its individual capacity,
accords its own property consisting of similar instruments or interests, it being understood that
neither the Collateral Agent nor any of the Holders shall have responsibility for (i) ascertaining
or taking action with respect to calls, conversions, exchanges, maturities, tenders or other
matters relating to any Securities Collateral, whether or not the Collateral Agent or any other
Holder has or is deemed to have knowledge of such matters or (ii) taking any necessary steps to
preserve rights against any person with respect to any Pledged Collateral.



(c) The Collateral Agent will not be responsible for the existence, genuineness or value of
any of the Pledged Collateral or for the validity, perfection, priority or enforceability of the
Liens in any of the Pledged Collateral, whether impaired by operation of law or by reason of any
action or omission to act on its part hereunder, except to the extent such action or omission
constitutes gross negligence or willful misconduct on the part of the Collateral Agent, as
determined by a final, non-appealable order of a court of competent jurisdiction, for the validity
or sufficiency of the Pledged Collateral or any agreement or assignment contained therein, for the
validity of the title of any Pledgor to the Pledged Collateral, for insuring the Pledged Collateral
or for the payment of taxes, charges, assessments or liens upon the Pledged Collateral or otherwise
as to the maintenance of the Pledged Collateral. The Collateral Agent hereby disclaims any
representation or warranty to the present and future holders of the Obligations concerning the
perfection of the security interests granted hereunder or in the value of any of the Pledged
Collateral.



(d) The Collateral Agent may at any time solicit written confirmatory instructions, in the
form of an Officers’ Certificate in form and substance reasonably satisfactory to the Collateral
Agent, or an order of a court of competent jurisdiction, as to any action that it may be requested
or required to take, or that it may propose to take, in the performance of any of its obligations
under this Agreement.



(e) The Collateral Agent may seek and rely upon, and shall be fully protected in relying upon,
any judicial order or judgment, upon any advice, opinion or statement of legal counsel, independent
consultants and other experts selected by it in good faith and upon any certification, instruction,
notice or other writing delivered to it by any Pledgor in compliance with the provisions of this
Agreement, without being required to determine the authenticity thereof or the correctness of any
fact stated therein or the propriety or validity of service thereof. The Collateral Agent may act
in reliance upon any instrument comporting with the provisions of this Agreement or any signature
reasonably believed by it to be genuine and may assume that any Person purporting to give notice or
receipt or advice or make any statement or execute any document in connection with the provisions
hereof has been duly authorized to do so.



(f) The Collateral Agent will not be required to advance or expend any funds or otherwise
incur any financial liability in the performance of its duties or the exercise of its powers or
rights hereunder unless it has been provided with security or indemnity reasonably satisfactory to
it against any and all liability or expense which may be incurred by it by reason of taking or
continuing to take such action.


 


28









 





(g) Each Pledgor jointly and severally agrees to pay upon demand to the Collateral Agent the
amount of any and all reasonable out-of-pocket expenses, including the reasonable fees,
disbursements and other charges of its counsel and of any experts or agents, which the Collateral
Agent may incur in connection with (i) the administration of this Agreement, (ii) the custody or
preservation of, or the sale of, collection from or other realization upon any of the Pledged
Collateral, (iii) the exercise, enforcement or protection of any rights of the Collateral Agent
hereunder or (iv) the failure of any Pledgor to perform or observe any of the provisions hereof
applicable to it.



(h) Without limitation of its indemnification obligations under the other Note Documents, each
Pledgor shall jointly and severally indemnify the Collateral Agent against, and hold it harmless
from, any and all loss, liability, claim, damage, or expense, including reasonable attorneys’ fees
and expenses, charges and disbursements, incurred by or asserted against the Collateral Agent
arising out of, in connection with, or as a result of (i) the execution, delivery or performance of
this Agreement or any other Note Document or any Intercreditor Agreement that may be in effect from
time to time or any agreement or instrument contemplated hereby or thereby, the performance by the
parties hereto and thereto of their respective obligations hereunder or thereunder or the
consummation of the transactions contemplated hereby or thereby or (ii) any claim, litigation,
investigation or proceeding relating to any of the foregoing, or to the Pledged Collateral, whether
or not the Collateral Agent is a party thereto, including the costs and expenses of enforcing this
Agreement or any of the Security Documents or any Intercreditor Agreement that may be in effect
from time to time; provided that such indemnity shall not be available to the extent that such
losses, claims, damages, liabilities or related expenses are determined by final and nonappealable
judgment by a court of competent jurisdiction to have resulted from the gross negligence or willful
misconduct of the Collateral Agent.



(i) Any such amounts payable as pursuant to paragraphs (g) or (h) under this Section 11.1
shall be additional Obligations secured hereby and by the other Security Documents. The provisions
of paragraphs (g), (h) and this paragraph (i) under this Section 11.1 shall survive and
remain operative and in full force and effect regardless of the termination of this Agreement, any
Intercreditor Agreement that may be in effect from time to time or any Note Document, the
consummation of the transactions contemplated hereby or thereby, the repayment of any of the
Obligations, the invalidity or unenforceability of any term or provision of this Agreement, any
Intercreditor Agreement that may be in effect from time to time or any Note Document, or any
investigation made by or on behalf of the Collateral Agent or any other Holder. All amounts due
under paragraphs (g), (h) and this paragraph (i) under this Section 11.1 shall be payable
on written demand therefor. Notwithstanding anything to the contrary herein or in this Section
11.1, no Pledgor shall be under any obligation to reimburse any expense or indemnify against
any Claim arising from the Collateral Agent’s own willful misconduct, negligence or bad faith.



SECTION 11.2. Collateral Agent May Perform; Collateral Agent Appointed
Attorney-in-Fact. If any Pledgor shall fail to perform any covenants contained in this
Agreement (including such Pledgor’s covenants to (i) pay the premiums in respect of all required
insurance policies hereunder, (ii) pay and discharge any taxes, assessments and special
assessments, levies, fees and governmental charges imposed upon or assessed against, and
landlords’, carriers’, mechanics’, workmen’s, repairmen’s, laborers’, materialmen’s, suppliers’ and
warehousemen’s Liens and other claims arising by operation of law against, all or any portion of
the Pledged



 


29









 






Collateral, (iii) make repairs, (iv) discharge Liens or (v) pay or perform any obligations of
such Pledgor under any Pledged Collateral) or if any representation or warranty on the part of any
Pledgor contained herein shall be breached, upon the occurrence and during the continuance of an
Event of Default, the Collateral Agent may (but shall not be obligated to) do the same or cause it
to be done or remedy any such breach, and may expend funds for such purpose; provided,
however, that the Collateral Agent shall in no event be bound to inquire into the validity
of any tax, Lien, imposition or other obligation which such Pledgor fails to pay or perform as and
when required hereby and which such Pledgor does not contest in accordance with the provisions of
the Indenture. Any and all amounts so expended by the Collateral Agent shall be paid by the
Pledgors in accordance with paragraphs (g) and (h) of Section 11.1. Neither the provisions
of this Section 11.2 nor any action taken by the Collateral Agent pursuant to the
provisions of this Section 11.2 shall prevent any such failure to observe any covenant
contained in this Agreement nor any breach of representation or warranty from constituting an Event
of Default. Each Pledgor hereby appoints the Collateral Agent its attorney-in-fact, with full
power and authority in the place and stead of such Pledgor and in the name of such Pledgor, or
otherwise, from time to time upon the occurrence and during the continuance of an Event of Default
in the Collateral Agent’s discretion to take any action and to execute any instrument, without the
consent of such Pledgor, consistent with the terms of the Indenture, this Agreement and the other
Security Documents which the Collateral Agent may deem necessary or advisable to accomplish the
purposes hereof (but the Collateral Agent shall not be obligated to and shall have no liability to
such Pledgor or any third party for failure to so do or take action). The foregoing grant of
authority is a power of attorney coupled with an interest and such appointment shall be irrevocable
for the term hereof.



SECTION 11.3. Continuing Security Interest; Assignment. This Agreement shall create a
continuing security interest in the Pledged Collateral and shall (i) be binding upon the Pledgors,
their respective successors and assigns and (ii) inure, together with the rights and remedies of
the Collateral Agent hereunder, to the benefit of the Collateral Agent and the other Holders and
each of their respective successors, transferees and assigns. No other persons (including any
other creditor of any Pledgor) shall have any interest herein or any right or benefit with respect
hereto. Without limiting the generality of the foregoing clause (ii), any Holder may assign or
otherwise transfer any indebtedness held by it secured by this Agreement to any other Person, and
such other Person shall thereupon become vested with all the benefits in respect thereof granted to
such Holder, herein or otherwise, subject however, to the provisions of the Indenture.



SECTION 11.4. Termination; Release. This Agreement and the security interests granted
hereby shall terminate upon payment in full of the Obligations and satisfaction and discharge of
the Indenture and consistent with any Intercreditor Agreement that may be in effect from time to
time. Upon such termination of this Agreement the Pledged Collateral shall be released from the
Lien of this Agreement in accordance with the provisions of the Indenture. Upon such release or
any release of Pledged Collateral or any part thereof in accordance with the provisions of the
Indenture, the Collateral Agent shall, upon the request and at the sole cost and expense of the
Pledgors, do or cause to be done all acts reasonably necessary to release any Pledged Collateral
permitted to be released hereunder or under the Indenture.



SECTION 11.5. Modification in Writing. No amendment, modification, supplement,
termination or waiver of or to any provision hereof, nor consent to any departure by any Pledgor



 


30









 






therefrom, shall be effective unless the same shall be made in accordance with the terms of
the Indenture and unless in writing and signed by the Collateral Agent. Any amendment,
modification or supplement of or to any provision hereof, any waiver of any provision hereof and
any consent to any departure by any Pledgor from the terms of any provision hereof in each case
shall be effective only in the specific instance and for the specific purpose for which made or
given. Except where notice is specifically required by this Agreement or any other document
evidencing the Obligations, no notice to or demand on any Pledgor in any case shall entitle any
Pledgor to any other or further notice or demand in similar or other circumstances.



SECTION 11.6. Notices. Unless otherwise provided herein or in the Indenture, any
notice or other communication herein required or permitted to be given shall be given in the manner
and become effective as set forth in the Indenture, as to any Pledgor, addressed to it at the
address of the Company set forth in the Indenture and as to the Collateral Agent, addressed to it
at the address set forth in the Indenture, or in each case at such other address as shall be
designated by such party in a written notice to the other party complying as to delivery with the
terms of this Section 11.6.



SECTION 11.7. Governing Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of New York, without regard to conflict of laws principles
thereof (other than Sections 5-1401 and 5-1402 of the New York General Obligations Law).



SECTION 11.8. Consent to Jurisdiction and Service of Process; Waiver of Jury Trial.
ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY PERSON ARISING OUT OF OR RELATING TO THIS AGREEMENT
MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE, COUNTY AND
CITY OF NEW YORK. BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH PARTY, FOR ITSELF AND ON BEHALF
OF THE SECURED PARTIES (IN THE CASE OF THE COLLATERAL AGENT), IRREVOCABLY:




(i) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF
SUCH COURTS;




(ii) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS IN SUCH COURTS;




(iii) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY
BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE APPLICABLE PERSON
IN ACCORDANCE WITH SECTION 11.6); AND




(iv) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (iii) ABOVE IS SUFFICIENT TO CONFER
PERSONAL JURISDICTION OVER THE APPLICABLE PERSON IN ANY SUCH PROCEEDING IN ANY SUCH COURT,
AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT.




(v) WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO
A TRIAL BY JURY IN


 


31









 






RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS AGREEMENT. EACH OF THE PARTIES 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
11.8.



SECTION 11.9. Severability of Provisions. Any provision hereof which is invalid,
illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the
extent of such invalidity, illegality or unenforceability without invalidating the remaining
provisions hereof or affecting the validity, legality or enforceability of such provision in any
other jurisdiction.



SECTION 11.10. Execution in Counterparts. This Agreement and any amendments, waivers,
consents or supplements hereto may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed and delivered, whether in
original or by facsimile or other electronic transmission, shall be deemed to be an original, and
all such counterparts together shall constitute one and the same agreement.



SECTION 11.11. Business Days. In the event any time period or any date provided in
this Agreement ends or falls on a day other than a Business Day, then such time period shall be
deemed to end and such date shall be deemed to fall on the next succeeding Business Day, and
performance herein may be made on such Business Day, with the same force and effect as if made on
such other day.



SECTION 11.12. No Credit for Payment of Taxes or Imposition. No Pledgor shall be
entitled to any credit against the principal, premium, if any, or interest payable under the
Indenture, and no Pledgor shall not be entitled to any credit against any other sums which may
become payable under the terms thereof or hereof, by reason of the payment of any Tax on the
Pledged Collateral or any part thereof.



SECTION 11.13. No Claims Against Collateral Agent. Nothing contained in this
Agreement shall constitute any consent or request by the Collateral Agent, express or implied, for
the performance of any labor or services or the furnishing of any materials or other property in
respect of the Pledged Collateral or any part thereof, nor as giving any Pledgor any right, power
or authority to contract for or permit the performance of any labor or services or the furnishing
of any materials or other property in such fashion as would permit the making of any claim against
the Collateral Agent in respect thereof or any claim that any Lien based on the performance of such
labor or services or the furnishing of any such materials or other property is prior to the Lien
hereof.



SECTION 11.14. No Release. Nothing set forth in this Agreement or any other Note
Document, nor the exercise by the Collateral Agent of any of the rights or remedies hereunder,
shall relieve any Pledgor from the performance of any term, covenant, condition or agreement on



 


32









 






such Pledgor’s part to be performed or observed under or in respect of any of the Pledged
Collateral or from any liability to any person under or in respect of any of the Pledged Collateral
or shall impose any obligation on the Collateral Agent or any other Holder to perform or observe
any such term, covenant, condition or agreement on such Pledgor’s part to be so performed or
observed or shall impose any liability on the Collateral Agent or any other Holder for any act or
omission on the part of such Pledgor relating thereto or for any breach of any representation or
warranty on the part of such Pledgor contained in this Agreement, the Indenture or the other Note
Documents, or under or in respect of the Pledged Collateral or made in connection herewith or
therewith. Anything herein to the contrary notwithstanding, neither the Collateral Agent nor any
other Holder shall have any obligation or liability under any contracts, agreements and other
documents included in the Pledged Collateral by reason of this Agreement, nor shall the Collateral
Agent or any other Holder be obligated to perform any of the obligations or duties of any Pledgor
thereunder or to take any action to collect or enforce any such contract, agreement or other
document included in the Pledged Collateral hereunder. The obligations of each Pledgor contained
in this Section 11.14 shall survive the termination hereof and the discharge of such
Pledgor’s other obligations under this Agreement, the Indenture and the other Note Documents.



SECTION 11.15. Obligations Absolute. All obligations of each Pledgor hereunder shall
be absolute and unconditional irrespective of:



(a) any bankruptcy, insolvency, reorganization, arrangement, readjustment, composition,
liquidation or the like of any other Pledgor;



(b) any lack of validity or enforceability of the Indenture or any other Note Document, or any
other agreement or instrument relating thereto;



(c) 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 or any other Note Document or any other agreement or instrument relating thereto;



(d) any pledge, exchange, release or non-perfection of any other collateral, or any release or
amendment or waiver of or consent to any departure from any guarantee, for all or any of the
Obligations;



(e) any exercise, non-exercise or waiver of any right, remedy, power or privilege under or in
respect hereof, the Indenture or any other Note Document except as specifically set forth in a
waiver granted pursuant to the provisions of Section 11.5 hereof; or



(f) any other circumstances which might otherwise constitute a defense available to, or a
discharge of, any Pledgor.



SECTION 11.16. Joint and Several Liability. All of the obligations of the Pledgors
hereunder are joint and several. The Collateral Agent may, in its sole and absolute discretion,
enforce the provisions hereof against any of the Pledgors and shall not be required to proceed
against all Pledgors jointly or seek payment from the Pledgors ratably. In addition, the
Collateral Agent may, in its sole and absolute discretion, select the Pledged Collateral of any one
or more of the Pledgors for sale or application to the Obligations, without regard to the ownership
of such



 


33









 






Pledged Collateral, and shall not be required to make such selection ratably from the Pledged
Collateral owned by all of the Pledgors. The release or discharge of any Pledgors by the
Collateral Agent shall not release or discharge any other Pledgors from the obligations of such
Person hereunder.




SECTION 11.17. Intercreditor Agreement.



(a) Notwithstanding anything herein to the contrary, the liens and security interests granted
to the Collateral Agent and the Holders pursuant to this Agreement and the exercise of any right or
remedy by the Collateral Agent or the Holders hereunder, are subject to the terms of any
Intercreditor Agreement that may be in effect from time to time by and among a working capital
lender to the Company, the Collateral Agent, the Company and the Pledgors from time to time party
thereto entered into in accordance with the Indenture. In the event of any conflict between the
terms of the Intercreditor Agreement, if any, and the terms of this Agreement, the terms of the
Intercreditor Agreement shall govern and control.



(b) From and after the effectiveness of the Intercreditor Agreement, if any, and for so long
as the Intercreditor Agreement remains in effect, all requirements hereunder for physical
possession of Pledged Collateral by the Collateral Agent or Control of Pledged Collateral by the
Collateral Agent shall be satisfied for all purposes hereunder by physical possession by or Control
of such Pledged Collateral by the working capital lender to the Company in accordance with the
terms of any Intercreditor Agreement that may be in effect from time to time.



SECTION 11.18. Post Closing Collateral Matters. (a) Notwithstanding anything
contained herein to the contrary, each Pledgor shall use its commercially reasonable efforts to
deliver the following items within the periods of time set forth below (unless extended by the
Collateral Agent in its reasonable discretion):




(i) an executed Account Control Agreement with respect to the Deposit Accounts listed
on Schedule 10 to the Perfection Questionnaire other than Excluded Accounts within 30 days
from the date hereof;




(ii) executed Credit Card Notifications with First Data and American Express within 60
days from the date hereof;




(iii) evidence of the good standing of Wind Spirit Limited, Wind Star Limited and Wind
Star Sail Cruises Limited within 30 days of the date hereof; and




(iv) delivery to the Collateral Agent the intercompany note listed on Schedule 6 to the
Perfection Questionnaire within 30 days of the date hereof.



(b) The Collateral Agent and the applicable Pledgor shall enter into any applicable
intercreditor arrangement in form and substance satisfactory to the Collateral Agent and take any
other actions reasonably necessary or advisable to cause the Liens securing the Obligations to
become junior to the lien described in clause (ix) of the definition of Permitted Liens in the
Indenture.



[Remainder of Page Intentionally Left Blank]



 


34









 






IN WITNESS WHEREOF, each Pledgor and the Collateral Agent have caused this Agreement to be
duly executed and delivered by their duly authorized officers as of the date first above written.



	 	 	 	 	 
	 	AMBASSADORS INTERNATIONAL, INC.,

as a Pledgor

 	 
	 	By:  	/s/ Arthur A. Rodney
 	 
	 	 	Name:  	Arthur A. Rodney 	 
	 	 	Title:  	Chief Executive Officer 	 
	 
	 	AMBASSADORS CRUISE GROUP, LLC,

MQ BOAT, LLC,

DQ BOAT, LLC,

CONTESSA BOAT, LLC,

CQ BOAT, LLC,

AMBASSADORS INTERNATIONAL CRUISE GROUP (USA), LLC,

AMERICAN WEST STEAMBOAT COMPANY LLC,

QW BOAT COMPANY LLC,

AMBASSADORS INTERNATIONAL 

HOLDINGS MARSHALL ISLANDS, LLC,

AMBASSADORS INTERNATIONAL CRUISE GROUP, LLC,

AMBASSADORS INTERNATIONAL INVESTMENTS, LLC,

WINDSTAR SAIL CRUISES LIMITED,

WIND STAR LIMITED,

WIND SPIRIT LIMITED, and

DEGREES LIMITED,

each as Subsidiary Guarantors and as Pledgors

 	 
	 	By:  	/s/ Arthur A. Rodney
 	 
	 	 	Name:  	Arthur A. Rodney 	 
	 	 	Title:  	Authorized Signatory 	 



[Signature page to Pledge and Security Agreement]




 


 









 







	 	 	 	 	 
	 	WILMINGTON TRUST FSB,

as Collateral Agent

 	 
	 	By:  	/s/ Michael G. Oller, Jr.
 	 
	 	 	Name:  	Michael G. Oller, Jr. 	 
	 	 	Title:  	Assistant Vice President	 



[Signature page to Pledge and Security Agreement]





 


 









 










EXHIBIT 1




[Form of]




Copyright Security Agreement






Copyright Security Agreement, dated as of [                    
 _____, 20____] by [                    ] and

[                    ] (individually, a “Pledgor”, and, collectively, the “Pledgors”), in favor of
WILMINGTON TRUST FSB, in its capacity as collateral agent (in such capacity, the “Collateral
Agent”).



W I T N E S S E T H




WHEREAS, the Pledgors are party to a Pledge and Security Agreement dated as of November 13,
2009 (the “Security Agreement”) in favor of the Collateral Agent pursuant to which the
Pledgors are required to execute and deliver this Copyright Security Agreement;



NOW, THEREFORE, in consideration of the premises and to induce the Collateral Agent, for the
benefit of the Holders, to enter into the Indenture, the Pledgors hereby agree with the Collateral
Agent as follows:



SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the
Security Agreement and used herein have the meaning given to them in the Security Agreement.



SECTION 2. Grant of Security Interest in Copyright Collateral. Each Pledgor hereby
pledges and grants to the Collateral Agent for the benefit of the Holders a lien on and security
interest in and to all of its right, title and interest in, to and under all the following now
owned or hereafter acquired Pledged Collateral of such Pledgor:



(a) Copyrights of such Pledgor and any Intellectual Property Licenses concerning such
Copyrights listed on Schedule I attached hereto; and




(b) all Proceeds of any and all of the foregoing.



SECTION 3. Security Agreement. The security interest granted pursuant to this
Copyright Security Agreement is granted in conjunction with the security interest granted to the
Collateral Agent pursuant to the Security Agreement and Pledgors hereby acknowledge and affirm that
the rights and remedies of the Collateral Agent with respect to the security interest in the
Copyrights made and granted hereby are more fully set forth in the Security Agreement, the terms
and provisions of which are incorporated by reference herein as if fully set forth herein. In the
event that any provision of this Copyright Security Agreement is deemed to conflict with the
Security Agreement, the provisions of the Security Agreement shall control.



SECTION 4. Termination. Upon the payment in full of the Obligations and termination
of the Security Agreement, the Collateral Agent shall execute, acknowledge, and deliver to the
Pledgors an instrument in writing in recordable form releasing the collateral pledge, grant,
assignment, lien and security interest in the Copyrights under this Copyright Security Agreement.


 


Ex. 1-1









 





SECTION 5. Counterparts. This Copyright Security Agreement may be executed in any
number of counterparts, all of which shall constitute one and the same instrument, and any party
hereto may execute this Copyright Security Agreement by signing and delivering one or more
counterparts.



[Remainder of Page Intentionally Left Blank]




 


Ex. 1-2









 









IN WITNESS WHEREOF, each Pledgor has caused this Copyright Security Agreement to be executed and
delivered by its duly authorized offer as of the date first set forth above.



	 	 	 	 	 
	 	Very truly yours,



[AMBASSADORS CRUISE GROUP, LLC,

MQ BOAT, LLC,

DQ BOAT, LLC,

CONTESSA BOAT, LLC,

CQ BOAT, LLC,

AMBASSADORS INTERNATIONAL CRUISE GROUP (USA), LLC,

AMERICAN WEST STEAMBOAT COMPANY LLC,

QW BOAT COMPANY LLC,

AMBASSADORS INTERNATIONAL 

HOLDINGS MARSHALL
ISLANDS, LLC,

AMBASSADORS INTERNATIONAL CRUISE GROUP, LLC,

AMBASSADORS INTERNATIONAL INVESTMENTS, LLC,

WINDSTAR SAIL CRUISES LIMITED,

WIND STAR LIMITED,

WIND SPIRIT LIMITED, and

DEGREES LIMITED,] [AS APPLICABLE]

each as Subsidiary Guarantor and as Pledgor

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



 


Ex. 1-3









 






	 	 	 	 	 



	 	 	 	 	 
	AGREED TO AND ACCEPTED:	 	 
	 
	 	 	 	 
	WILMINGTON TRUST FSB,
as Collateral	 	 
	 Agent	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 






 


Ex. 1-4









 






SCHEDULE I




to




COPYRIGHT SECURITY AGREEMENT

COPYRIGHT REGISTRATIONS AND COPYRIGHT APPLICATIONS




Copyright Registrations:




	 	 	 	 	 	 	 	 	 
	 	 	REGISTRATION	 	 	 	 
	OWNER	 	NUMBER	 	 	TITLE	 
	 
	 	 	 	 	 	 	 	 






Copyright Applications:




	 	 	 	 	 
	OWNER	 	TITLE	 
	 
	 	 	 	 






Copyright Intellectual Property Licenses:




	 	 	 	 	 	 	 	 	 
	LICENSOR	 	LICENSEE	 	 	DESCRIPTION	 
	 
	 	 	 	 	 	 	 	 







 


Ex. 1-5









 







EXHIBIT 2




[Form of]




JOINDER AGREEMENT




[Name of New Pledgor]

[Address of New Pledgor]




[Date]




                                        

 

                                        

 

                                        

 

                                        

 

                                        




Ladies and Gentlemen:



Reference is made to the Pledge and Security Agreement (as amended, amended and restated,
supplemented or otherwise modified from time to time, the “Security Agreement;” capitalized
terms used but not otherwise defined herein shall have the meanings assigned to such terms in the
Security Agreement), dated as of November 13, 2009, made by made by AMBASSADORS INTERNATIONAL,
INC., a Delaware corporation (the “Company”), and the Subsidiary Guarantors (as defined in
the Indenture referred to below) from to time to time party hereto), as pledgors, assignors and
debtors (the Company, together with the Subsidiary Guarantors, in such capacities and together with
any successors in such capacities, the “Pledgors,” and each, a “Pledgor”), in favor
of WILMINGTON TRUST FSB, in its capacity as collateral agent (in such capacity and together with
any successors in such capacity, the “Collateral Agent”).



This Joinder Agreement supplements the Security Agreement and is delivered by the undersigned,
[                    ] (the “New Pledgor”), pursuant to Section 3.5 of the Security
Agreement. The New Pledgor hereby agrees to be bound as a Subsidiary Guarantor and as a Pledgor
party to the Security Agreement by all of the terms, covenants and conditions set forth in the
Security Agreement to the same extent that it would have been bound if it had been a signatory to
the Security Agreement on the date of the Security Agreement. The New Pledgor also hereby agrees
to be bound as a party by all of the terms, covenants and conditions applicable to it set forth in
the Indenture, if any, to the same extent that it would have been bound if it had been a signatory
to the Indenture on the execution date of the Indenture. Without limiting the generality of the
foregoing, the New Pledgor hereby grants and pledges to the Collateral Agent, as collateral
security for the full, prompt and complete payment and performance when due (whether at stated
maturity, by acceleration or otherwise) of the Obligations (as defined in the Indenture), a Lien on
and security interest in, all of its right, title and interest in, to and under the Pledged
Collateral and expressly assumes all obligations and liabilities of a Subsidiary Guarantor and
Pledgor thereunder. The New Pledgor hereby makes each of the representations and


 


Ex. 2-1









 





warranties and agrees to each of the covenants applicable to the Pledgors contained in the
Security Agreement and the Indenture.



Concurrent with the execution of this Joinder Agreement, the New Pledgor shall deliver to the
Collateral Agent a Perfection Questionnaire and supplements to each of the schedules to the
Security Agreement and the Indenture, as applicable, with respect to the New Pledgor. Such
supplements shall be deemed to be part of the Security Agreement or the Indenture, as applicable.



This Joinder Agreement and any amendments, waivers, consents or supplements hereto may be
executed in any number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed and delivered shall be deemed to be an original, but all such
counterparts together shall constitute one and the same agreement.



In acting under and by virtue of this Joinder Agreement, the Collateral Agent shall have all
of the rights, protections and immunities granted to it under the Security Agreement, all of which
are incorporated herein mutatis mutandis.



This Joinder Agreement shall be construed in accordance with and governed by the laws of the
State of New York, without regard to conflict of laws principles thereof (other than Sections
5-1401 and 5-1402 of the New York General Obligations Law).


 


Ex. 2-2









 






IN WITNESS WHEREOF, the New Pledgor has caused this Joinder Agreement to be executed and
delivered by its duly authorized officer as of the date first above written.



	 	 	 	 	 
	 	[NEW PLEDGOR]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 




	 	 	 	 	 
	AGREED TO AND ACCEPTED:	 	 
	 
	 	 	 	 
	WILMINGTON TRUST FSB,
as Collateral	 	 
	 Agent	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 






[Schedules to be attached]




 


Ex. 2-3









 









EXHIBIT 3




[Form of]




Patent Security Agreement





Patent Security Agreement, dated as of [__________
_____, 20
 ____________] by [____________] and [____________]
(individually, a “Pledgor”, and, collectively, the “Pledgors”), in favor of WILMINGTON
TRUST FSB, in its capacity as collateral agent (in such capacity, the “Collateral Agent”).



W I T N E S S E T H:




WHEREAS, the Pledgors are party to a Pledge and Security Agreement of dated as of November 13,
2009 (the “Security Agreement”) in favor of the Collateral Agent pursuant to which the
Pledgors are required to execute and deliver this Patent Security Agreement;



NOW, THEREFORE, in consideration of the premises and to induce the Collateral Agent, for the
benefit of the Holders, to enter into the Indenture, the Pledgors hereby agree with the Collateral
Agent as follows:



SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the
Security Agreement and used herein have the meaning given to them in the Security Agreement.



SECTION 2. Grant of Security Interest in Patent Collateral. Each Pledgor hereby
pledges and grants to the Collateral Agent for the benefit of the Holders a lien on and security
interest in and to all of its right, title and interest in, to and under all the following now
owned or hereafter acquired Pledged Collateral of such Pledgor:



(a) Patents of such Pledgor and Intellectual Property Licenses concerning such Patents listed
on Schedule I attached hereto; and




(b) all Proceeds of any and all of the foregoing.



SECTION 3. Security Agreement. The security interest granted pursuant to this Patent
Security Agreement is granted in conjunction with the security interest granted to the Collateral
Agent pursuant to the Security Agreement and Pledgors hereby acknowledge and affirm that the rights
and remedies of the Collateral Agent with respect to the security interest in the Patents made and
granted hereby are more fully set forth in the Security Agreement, the terms and provisions of
which are incorporated by reference herein as if fully set forth herein. In the event that any
provision of this Patent Security Agreement is deemed to conflict with the Security Agreement, the
provisions of the Security Agreement shall control.



SECTION 4. Termination. Upon the payment in full of the Obligations and termination
of the Security Agreement, the Collateral Agent shall execute, acknowledge, and deliver to the
Pledgors an instrument in writing in recordable form releasing the collateral pledge, grant,
assignment, lien and security interest in the Patents under this Patent Security Agreement.


 


Ex. 3-1









 





SECTION 5. Counterparts. This Patent Security Agreement may be executed in any number
of counterparts, all of which shall constitute one and the same instrument, and any party hereto
may execute this Patent Security Agreement by signing and delivering one or more counterparts.



[Remainder of Page Intentionally Left Blank]




 


Ex. 3-2









 









IN WITNESS WHEREOF, each Pledgor has caused this Patent Security Agreement to be executed and
delivered by its duly authorized offer as of the date first set forth above.



	 	 	 	 	 
	 	Very truly yours,



[AMBASSADORS CRUISE GROUP, LLC,

MQ BOAT, LLC,

DQ BOAT, LLC,

CONTESSA BOAT, LLC,

CQ BOAT, LLC,

AMBASSADORS INTERNATIONAL CRUISE GROUP (USA), LLC,

AMERICAN WEST STEAMBOAT COMPANY LLC,

QW BOAT COMPANY LLC,

AMBASSADORS INTERNATIONAL 

HOLDINGS MARSHALL
ISLANDS, LLC,

AMBASSADORS INTERNATIONAL CRUISE GROUP, LLC,

AMBASSADORS INTERNATIONAL INVESTMENTS, LLC,

WINDSTAR SAIL CRUISES LIMITED,

WIND STAR LIMITED,

WIND SPIRIT LIMITED, and

DEGREES LIMITED,] [AS APPLICABLE]

each as Subsidiary Guarantor and as Pledgor

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



 


Ex. 3-3









 






	 	 	 	 	 



	 	 	 	 	 
	AGREED TO AND ACCEPTED:	 	 
	 
	 	 	 	 
	WILMINGTON TRUST FSB,
as Collateral	 	 
	 Agent	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 






 


Ex. 3-4









 







SCHEDULE I




to




PATENT SECURITY AGREEMENT

PATENT REGISTRATIONS AND PATENT APPLICATIONS




Patent Registrations:




	 	 	 	 	 	 	 	 	 
	 	 	REGISTRATION	 	 	 	 
	OWNER	 	NUMBER	 	 	NAME	 
	 
	 	 	 	 	 	 	 	 






Patent Applications:




	 	 	 	 	 	 	 	 	 
	 	 	APPLICATION	 	 	 	 
	OWNER	 	NUMBER	 	 	NAME	 
	 
	 	 	 	 	 	 	 	 






Patent Intellectual Property Licenses:




	 	 	 	 	 	 	 	 	 
	LICENSOR	 	LICENSEE	 	 	DESCRIPTION	 
	 
	 	 	 	 	 	 	 	 







 


Ex. 3-5









 










EXHIBIT 4




[Form of]




CONTROL AGREEMENT CONCERNING SECURITIES ACCOUNTS




This Control Agreement Concerning Securities Accounts (this “Control Agreement”),
dated as of [________ _____, 20_____] by and among [_____________] (the “Pledgor”), WILMINGTON
TRUST FSB, as collateral agent (the “Collateral Agent”) and [_____________] (the
“Securities Intermediary”), is delivered pursuant to Section 3.4(c) of that certain
Pledge and Security Agreement (as amended, amended and restated, supplemented or otherwise modified
from time to time, the “Security Agreement”), dated as of November 13, 2009 made by the
Pledgor and each of the other parties listed on the signature pages thereto in favor of the
Collateral Agent, as pledgee, assignee and secured party. This Control Agreement is for the
purpose of perfecting the security interests of the Holders granted by the Pledgor in the
Designated Accounts described below. All references herein to the “UCC” shall mean the Uniform
Commercial Code as in effect from time to time in the State of New York. Capitalized terms used
but not defined herein shall have the meanings assigned to such terms in the Security Agreement.



Section 1. Confirmation of Establishment and Maintenance of Designated
Accounts. The Securities Intermediary hereby confirms and agrees that (i) the Securities
Intermediary has established for the Pledgor and maintains the account(s) listed in Schedule
I annexed hereto (such account(s), together with each such other securities account maintained
by the Pledgor with the Securities Intermediary collectively, the “Designated Accounts” and
each a “Designated Account”), (ii) each Designated Account will be maintained in the manner
set forth herein until termination of this Control Agreement, (iii) this Control Agreement is the
valid and legally binding obligation of the Securities Intermediary, (iv) the Securities
Intermediary is a “securities intermediary” as defined in Article 8-102(a)(14) of the UCC, (v) each
of the Designated Accounts is a “securities account” as such term is defined in Section 8-501(a) of
the UCC and (vi) all securities or other property underlying any financial assets which are
credited to any Designated Account shall be registered in the name of the Securities Intermediary,
endorsed to the Securities Intermediary or in blank or credited to another securities account
maintained in the name of the Securities Intermediary and in no case will any financial asset
credited to any Designated Account be registered in the name of the Pledgor, payable to the order
of the Pledgor or specially endorsed to the Pledgor, except to the extent the foregoing have been
specially endorsed to the Securities Intermediary or in blank.



Section 2. “Financial Assets” Election. All parties hereto agree that each item of
Investment Property and all other property held in or credited to any Designated Account (the
“Account Property”) shall be treated as a “financial asset” within the meaning of Section
8-102(a)(9) of the UCC.



Section 3. Entitlement Order. If at any time the Securities Intermediary shall
receive an “entitlement order” (within the meaning of Section 8-102(a)(8) of the UCC) issued by the
Collateral Agent and relating to any financial asset maintained in one or more of the Designated
Accounts, the Securities Intermediary shall comply with such entitlement order



 


Ex. 4-1









 





without further consent by the Pledgor or any other person. The Securities Intermediary shall
also comply with instructions directing the Securities Intermediary with respect to the sale,
exchange or transfer of any Account Property held in each Designated Account originated by a
Pledgor, or any representative of, or investment manager appointed by, a Pledgor until such time as
the Collateral Agent delivers a Notice of Sole Control pursuant to Section 9(i) to the Securities
Intermediary. The Securities Intermediary shall comply with, and is fully entitled to rely upon,
any entitlement order from the Collateral Agent, even if such entitlement order is contrary to any
entitlement order that the Pledgor may give or may have given to the Securities Intermediary.



Section 4. Subordination of Lien; Waiver of Set-Off. The Securities Intermediary
hereby agrees that any security interest in, lien on, encumbrance, claim or (except as provided in
the next sentence) right of setoff against, any Designated Account or any Account Property it now
has or subsequently obtains shall be subordinate to the security interest of the Collateral Agent
in the Designated Accounts and the Account Property therein or credited thereto. The Securities
Intermediary agrees not to exercise any present or future right of recoupment or set-off against
any of the Designated Accounts or to assert against any of the Designated Accounts any present or
future security interest, banker’s lien or any other lien or claim (including claim for penalties)
that the Securities Intermediary may at any time have against or in any of the Designated Accounts
or any Account Property therein or credited thereto; provided, however, that the
Securities Intermediary may set off all amounts due to the Securities Intermediary in respect of
its customary fees and expenses for the routine maintenance and operation of the Designated
Accounts, including overdraft fees and amounts advanced to settle authorized transactions.



Section 5. Choice of Law. Both this Control Agreement and the Designated Accounts
shall be governed by the laws of the State of New York. Regardless of any provision in any other
agreement, for purposes of the UCC, New York shall be deemed to be the Securities Intermediary’s
jurisdiction and the Designated Accounts (as well as the security entitlements related thereto)
shall be governed by the laws of the State of New York.



Section 6. Conflict with Other Agreements; Amendments. As of the date hereof, there
are no other agreements entered into between the Securities Intermediary and the Pledgor with
respect to any Designated Account or any security entitlements or other financial assets credited
thereto (other than standard and customary documentation with respect to the establishment and
maintenance of such Designated Accounts). The Securities Intermediary and the Pledgor will not
enter into any other agreement with respect to any Designated Account unless the Collateral Agent
shall have received prior written notice thereof. The Securities Intermediary and the Pledgor have
not and will not enter into any other agreement with respect to (i) creation or perfection of any
security interest in or (ii) control of security entitlements maintained in any of the Designated
Accounts or purporting to limit or condition the obligation of the Securities Intermediary to
comply with entitlement orders with respect to any Account Property held in or credited to any
Designated Account as set forth in Section 3 hereof without the prior written consent of
the Collateral Agent acting in its sole discretion. In the event of any conflict with respect to
control over any Designated Account between this Control Agreement (or any portion hereof) and any
other agreement now existing or hereafter entered into, the terms of this Control Agreement shall
prevail. No amendment or modification of this Control



 


Ex. 4-2









 






Agreement or waiver of any rights hereunder shall be binding on any party hereto unless it is
in writing and is signed by all the parties hereto.




Section 7. Certain Agreements.




(i) As of the date hereof, the Securities Intermediary has furnished to the Collateral
Agent the most recent account statement issued by the Securities Intermediary with respect
to each of the Designated Accounts and the financial assets and cash balances held therein,
identifying the financial assets held therein in a manner acceptable to the Collateral
Agent. Each such statement accurately reflects the assets held in such Designated Account
as of the date thereof.




(ii) The Securities Intermediary will, upon its receipt of each supplement to the
Security Agreement signed by the Pledgor and identifying one or more financial assets as
“Pledged Collateral,” enter into its records, including computer records, with respect to
each Designated Account a notation with respect to any such financial asset so that such
records and reports generated with respect thereto identify such financial asset as
“Pledged.”



Section 8. Notice of Adverse Claims. Except for the claims and interest of the
Collateral Agent and of the Pledgor in the Account Property held in or credited to the Designated
Accounts, the Securities Intermediary on the date hereof does not know of any claim to, security
interest in, lien on, or encumbrance against, any Designated Account or Account Property held in or
credited thereto and does not know of any claim that any person or entity other than the Collateral
Agent has been given “control” (within the meaning of Section 8-106 of the UCC) of any Designated
Account or any such Account Property. If the Securities Intermediary becomes aware that any person
or entity is asserting any lien, encumbrance, security interest or adverse claim (including any
writ, garnishment, judgment, warrant of attachment, execution or similar process or any claim of
control) against any of the Account Property held in or credited to any Designated Account, the
Securities Intermediary shall promptly notify the Collateral Agent and the Pledgor thereof.



Section 9. Maintenance of Designated Accounts. In addition to the obligations of the
Securities Intermediary in Section 3 hereof, the Securities Intermediary agrees to maintain
the Designated Accounts as follows:




(i) Notice of Sole Control. If at any time the Collateral Agent delivers to
the Securities Intermediary a notice instructing the Securities Intermediary to terminate
Pledgor’s access to any Designated Account (the “Notice of Sole Control”), the
Securities Intermediary agrees that, after receipt of such notice, it will take all
instructions with respect to such Designated Account solely from the Collateral Agent,
terminate all instructions and orders originated by the Pledgor with respect to the
Designated Accounts or any Account Property therein, and cease taking instructions from
Pledgor, including, without limitation, instructions for investment, distribution or
transfer of any financial asset maintained in any Designated Account. Permitting settlement
of trades pending at the time of receipt of such notice shall not constitute a violation of
the immediately preceding sentence. The Collateral Agent hereby agrees with the Pledgor to


 


Ex. 4-3









 






only deliver a Notice of Sole Control upon the occurrence and during the continuation
of an Event of Default and that it will revoke such Notice of Sole Control when such Event
of Default is no longer continuing.




(ii) Voting Rights. Until such time as the Securities Intermediary receives a
Notice of Sole Control, the Pledgor, or an investment manager on behalf of the Pledgor,
shall direct the Securities Intermediary with respect to the voting of any financial assets
credited to any Designated Account.




(iii) Statements and Confirmations. The Securities Intermediary will send
copies of all statements and other correspondence (excluding routine confirmations)
concerning any Designated Account or any financial assets credited thereto simultaneously to
each of the Pledgor and the Collateral Agent at the address set forth in Section 11
hereof. The Securities Intermediary will provide to the Collateral Agent, upon the
Collateral Agent’s request therefor from time to time and, in any event, as of the last
business day of each calendar month, a statement of the market value of each financial asset
maintained in each Designated Account. The Securities Intermediary shall not change the
name or account number of any Designated Account without the prior written consent of the
Collateral Agent.




(iv) Perfection in Certificated Securities. The Securities Intermediary
acknowledges that, in the event that it should come into possession of any certificate
representing any security or other Account Property held in or credited to any of the
Designated Accounts, the Securities Intermediary shall retain possession of the same on
behalf and for the benefit of the Collateral Agent and such act shall cause the Securities
Intermediary to be deemed holding such certificate for the Collateral Agent, if necessary to
perfect the Collateral Agent’s security interest in such securities or assets. The
Securities Intermediary hereby acknowledges its receipt of a copy of the Security Agreement,
which shall also serve as notice to the Securities Intermediary of a security interest in
collateral held on behalf and for the benefit of the Collateral Agent.



Section 10. Successors; Assignment. The terms of this Control Agreement shall be
binding upon, and shall inure to the benefit of, the parties hereto and their respective corporate
successors and permitted assignees.


 


Ex. 4-4









 







Section 11. Notices. Any notice, request or other communication required or permitted to be given
under this Control Agreement shall be in writing and deemed to have been properly given when
delivered in person, or when sent by telecopy or other electronic means and electronic confirmation
of error free receipt is received or two (2) days after being sent by certified or registered
United States mail, return receipt requested, postage prepaid, addressed to the party at the
address set forth below.



	 	 	 	 	 
	 

	 	Pledgor:
	 	[                               ]
	 

	 	 	 	[Address]
	 

	 	 	 	Attention:
	 

	 	 	 	Telecopy:
	 

	 	 	 	Telephone:
	 
	 	 	 	 
	 

	 	 	 	with copy to:
	 
	 	 	 	 
	 

	 	 	 	[                               ]
	 

	 	 	 	[Address]
	 

	 	 	 	Attention:
	 

	 	 	 	Telecopy:
	 

	 	 	 	Telephone:
	 
	 	 	 	 
	 

	 	Securities Intermediary:
	 	[                               ]
	 

	 	 
	 	[Address]
	 

	 	 	 	Attention:
	 

	 	 	 	Telecopy:
	 

	 	 	 	Telephone:
	 
	 	 	 	 
	 

	 	Collateral Agent:
	 	Wilmington Trust FSB
	 

	 	 
	 	[                               ]
	 

	 	 	 	Attention: Corporate Trust Office
	 

	 	 	 	Telecopy: [                                        ]
	 
	 	 	 	 
	 

	 	 	 	with a copy to:
	 
	 	 	 	 
	 

	 	 	 	[                                ]
	 

	 	 	 	[                                ]
	 

	 	 	 	[                                ]
	 

	 	 	 	Attention: [                                ]
	 

	 	 	 	Telecopy: [                                ]






Any party may change its address for notices in the manner set forth above.


 


Ex. 4-5









 






Section 12. Termination.




(i) Except as otherwise provided in this Section 12, the obligations of the Securities
Intermediary hereunder and this Control Agreement shall continue in effect until the
security interests of the Collateral Agent in the Designated Accounts and any and all
Account Property held therein or credited thereto have been terminated pursuant to the terms
of the Security Agreement and the Collateral Agent has notified the Securities Intermediary
of such termination in writing.




(ii) The Securities Intermediary, acting alone, may terminate this Control Agreement at
any time and for any reason by written notice delivered to the Collateral Agent and the
Pledgor not less than thirty (30) days prior to the effective termination date.




(iii) Prior to any termination of this Control Agreement pursuant to this Section 12,
the Securities Intermediary hereby agrees that it shall promptly take, at Pledgor’s sole
cost and expense, all reasonable actions necessary to facilitate the transfer of any Account
Property in or credited to the Designated Accounts as follows: (i) in the case of a
termination of this Control Agreement under Section 12(i), to the institution
designated in writing by Pledgor; and (ii) in all other cases, to the institution designated
in writing by the Collateral Agent.



Section 13. Fees and Expenses. The Securities Intermediary agrees to look solely to
the Pledgor for payment of any and all fees, costs, charges and expenses incurred or otherwise
relating to the Designated Accounts and services provided by the Securities Intermediary hereunder
(collectively, the “Account Expenses”), and the Pledgor agrees to pay such Account Expenses
to the Securities Intermediary on demand therefor. The Pledgor acknowledges and agrees that it
shall be, and at all times remains, solely liable to the Securities Intermediary for all Account
Expenses.



Section 14. Severability. If any term or provision set forth in this Control
Agreement shall be invalid or unenforceable, the remainder of this Control Agreement, other than
those provisions held invalid or unenforceable, shall be construed in all respects as if such
invalid or unenforceable term or provision were omitted.



Section 15. Counterparts. This Control Agreement may be executed in any number of
counterparts, all of which shall constitute one and the same instrument, and any party hereto may
execute this Control Agreement by signing and delivering one or more counterparts.



[Remainder of Page Intentionally Left Blank]




 


Ex. 4-6









 







	 	 	 	 	 
	 	[PLEDGOR],

as Pledgor

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	WILMINGTON TRUST FSB, as Collateral Agent

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	[SECURITIES INTERMEDIARY],

as Securities Intermediary

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



 


Ex. 4-7









 






	 	 	 	 	 



SCHEDULE
I



Designated Account(s)





 


Ex. 4-8









 









EXHIBIT 5




[Form of]




Trademark Security Agreement






Trademark Security Agreement, dated as of
[_________
_____, 20____], by [_____________] and [_____________]
(individually, a “Pledgor”, and, collectively, the “Pledgors”), in favor of WILMINGTON
TRUST FSB, in its capacity as collateral agent (in such capacity, the “Collateral Agent”).



W I N E S S E T H:




WHEREAS, the Pledgors are party to a Pledge and Security Agreement dated as of November 13,
2009 (the “Security Agreement”) in favor of the Collateral Agent pursuant to which the
Pledgors are required to execute and deliver this Trademark Security Agreement;



NOW, THEREFORE, in consideration of the premises and to induce the Collateral Agent, for the
benefit of the Holders, to enter into the Indenture, the Pledgors hereby agree with the Collateral
Agent as follows:



SECTION 1. Defined Terms. Unless otherwise defined herein, terms defined in the
Security Agreement and used herein have the meaning given to them in the Security Agreement.



SECTION 2. Grant of Security Interest in Trademark Collateral. Each Pledgor hereby
pledges and grants to the Collateral Agent for the benefit of the Holders a lien on and security
interest in and to all of its right, title and interest in, to and under all the following now
owned or hereafter acquired Pledged Collateral of such Pledgor:



(a) Trademarks of such Pledgor and Intellectual Property Licenses concerning such Trademarks
listed on Schedule I attached hereto; and




(b) all Proceeds of any and all of the foregoing.



SECTION 3. Security Agreement. The security interest granted pursuant to this
Trademark Security Agreement is granted in conjunction with the security interest granted to the
Collateral Agent pursuant to the Security Agreement and Pledgors hereby acknowledge and affirm that
the rights and remedies of the Collateral Agent with respect to the security interest in the
Trademarks made and granted hereby are more fully set forth in the Security Agreement, the terms
and provisions of which are incorporated by reference herein as if fully set forth herein. In the
event that any provision of this Trademark Security Agreement is deemed to conflict with the
Security Agreement, the provisions of the Security Agreement shall control.



SECTION 4. Termination. Upon the payment in full of the Obligations and termination
of the Security Agreement, the Collateral Agent shall execute, acknowledge, and deliver to the
Pledgors an instrument in writing in recordable form releasing the collateral pledge, grant,
assignment, lien and security interest in the Trademarks under this Trademark Security Agreement.


 


Ex. 5-1









 





SECTION 5. Counterparts. This Trademark Security Agreement may be executed in any
number of counterparts, all of which shall constitute one and the same instrument, and any party
hereto may execute this Trademark Security Agreement by signing and delivering one or more
counterparts.



[Remainder of Page Intentionally Left Blank]




 


Ex. 5-2









 








IN WITNESS WHEREOF, each Pledgor has caused this Trademark Security Agreement to be executed
and delivered by its duly authorized offer as of the date first set forth above.



	 	 	 	 	 
	 	Very truly yours,



[AMBASSADORS CRUISE GROUP, LLC,

MQ BOAT, LLC,

DQ BOAT, LLC,

CONTESSA BOAT, LLC,

CQ BOAT, LLC,

AMBASSADORS INTERNATIONAL CRUISE GROUP (USA), LLC,

AMERICAN WEST STEAMBOAT COMPANY LLC,

QW BOAT COMPANY LLC,

AMBASSADORS INTERNATIONAL 

HOLDINGS MARSHALL
ISLANDS, LLC,
AMBASSADORS INTERNATIONAL CRUISE GROUP, LLC,

AMBASSADORS INTERNATIONAL INVESTMENTS, LLC,

WINDSTAR SAIL CRUISES LIMITED,

WIND STAR LIMITED,

WIND SPIRIT LIMITED, and

DEGREES LIMITED,] [AS APPLICABLE]

each as Subsidiary Guarantor and as Pledgor

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



 


Ex. 5-3









 






	 	 	 	 	 



	 	 	 	 	 
	AGREED TO AND ACCEPTED:	 	 
	 
	 	 	 	 
	WILMINGTON TRUST FSB,
as Collateral	 	 
	 Agent	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 






 


Ex. 5-4









 






SCHEDULE I




to




TRADEMARK SECURITY AGREEMENT

TRADEMARK REGISTRATIONS AND TRADEMARK APPLICATIONS




Trademark Registrations:




	 	 	 	 	 	 	 	 	 
	 	 	REGISTRATION	 	 	 	 
	OWNER	 	NUMBER	 	 	TRADEMARK	 
	 
	 	 	 	 	 	 	 	 






Trademark Applications:




	 	 	 	 	 	 	 	 	 
	 	 	APPLICATION	 	 	 	 
	OWNER	 	NUMBER	 	 	TRADEMARK	 
	 
	 	 	 	 	 	 	 	 






Trademark Intellectual Property Licenses:




	 	 	 	 	 	 	 	 	 
	LICENSOR	 	LICENSEE	 	 	DESCRIPTION	 
	 
	 	 	 	 	 	 	 	 







 


Ex. 5-5









 







EXHIBIT 6




[Form of]




ISSUER’S ACKNOWLEDGMENT




The undersigned hereby (i) acknowledges receipt of the Pledge and Security Agreement (as
amended, amended and restated, supplemented or otherwise modified from time to time, the
“Security Agreement;” capitalized terms used but not otherwise defined herein shall have
the meanings assigned to such terms in the Security Agreement), dated as of November 13, 2009 made
by AMBASSADORS INTERNATIONAL, INC., a Delaware corporation (the “Company”), and the
Subsidiary Guarantors (as defined in the Indenture referred to below) from to time to time party
hereto), as pledgors, assignors and debtors (the Company, together with the Subsidiary Guarantors,
in such capacities and together with any successors in such capacities, the “Pledgors,” and
each, a “Pledgor”), in favor of WILMINGTON TRUST FSB, in its capacity as collateral agent
(in such capacity and together with any successors in such capacity, the “Collateral
Agent”), (ii) agrees promptly to note on its books the security interests granted to the
Collateral Agent and confirmed under the Security Agreement, (iii) agrees that it will comply with
instructions of the Collateral Agent with respect to the applicable Securities Collateral without
further consent by the applicable Pledgor, (iv) agrees to notify the Collateral Agent upon
obtaining knowledge of any interest in favor of any person in the applicable Securities Collateral
that is adverse to the interest of the Collateral Agent therein and (v) waives any right or
requirement at any time hereafter to receive a copy of the Security Agreement in connection with
the registration of any Securities Collateral thereunder in the name of the Collateral Agent or its
nominee or the exercise of voting rights by the Collateral Agent or its nominee.



	 	 	 	 	 
	 	[ISSUER]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 




 


Ex. 6-1









 










EXHIBIT 7




[Form of]




SECURITIES PLEDGE AMENDMENT






This Securities Pledge Amendment, dated as of
[________ _____, 20_____] is delivered pursuant to
Section 5.1 of the Pledge and Security Agreement (as amended, amended and restated,
supplemented or otherwise modified from time to time, the “Security Agreement;” capitalized
terms used but not otherwise defined herein shall have the meanings assigned to such terms in the
Security Agreement), dated as of November 13, 2009, made by made by AMBASSADORS INTERNATIONAL,
INC., a Delaware corporation (the “Company”), and the Subsidiary Guarantors (as defined in
the Indenture referred to below) from to time to time party hereto), as pledgors, assignors and
debtors (the Company, together with the Subsidiary Guarantors, in such capacities and together with
any successors in such capacities, the “Pledgors,” and each, a “Pledgor”), in favor
of WILMINGTON TRUST FSB, in its capacity as collateral agent (in such capacity and together with
any successors in such capacity, the “Collateral Agent”). The undersigned hereby agrees
that this Securities Pledge Amendment may be attached to the Security Agreement and that the
Pledged Securities and/or Intercompany Notes listed on this Securities Pledge Amendment shall be
deemed to be and shall become part of the Pledged Collateral and shall secure all Obligations. In
acting under and by virtue of this Securities Pledge Amendment, the Collateral Agent shall have all
of the rights, protections and immunities granted to it under the Security Agreement, all of which
are incorporated herein mutatis mutandis.



PLEDGED SECURITIES




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	CLASS	 	 	 	 	 	 	 	 	 	 	NUMBER OF	 	 	 	 
	 	 	OF STOCK	 	 	 	 	 	 	 	 	 	 	SHARES	 	 	PERCENTAGE OF	 
	 	 	OR	 	 	PAR	 	 	CERTIFICATE	 	 	OR	 	 	ALL ISSUED CAPITAL	 
	ISSUER	 	INTERESTS	 	 	VALUE	 	 	NO(S).	 	 	INTERESTS	 	 	STOCK OF ISSUER	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 






 


Ex. 7-1









 






INTERCOMPANY NOTES




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	PRINCIPAL	 	 	DATE OF	 	 	INTEREST	 	 	MATURITY	 
	ISSUER	 	AMOUNT	 	 	ISSUANCE	 	 	RATE	 	 	DATE	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 






	 	 	 	 	 
	 	[PLEDGOR],

as Pledgor

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 




	 	 	 	 	 
	AGREED TO AND ACCEPTED:	 	 
	 
	 	 	 	 
	WILMINGTON TRUST FSB,
as Collateral	 	 
	 Agent	 	 
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title:	 	 







 


Ex. 7-2









 








EXHIBIT 8




[Form of]




CREDIT CARD NOTIFICATION

PREPARE ON PLEDGOR LETTERHEAD — ONE FOR EACH PROCESSOR




[____________ ____, 20___]




BY CERTIFIED MAIL — RETURN RECEIPT REQUESTED



To:    [Name and Address of Processor]




	 	 	 	 
	 

	Re:
	 	
                                        
                                         . The credit card processing agreement between [name of Pledgor] and
[name of Processor] (the “Processor”) dated                                          (the
“Processing Agreement”).







Dear Sir/Madam:



Under various agreements among [insert name of applicable Pledgor] (the “Pledgor”) and
WILMINGTON TRUST FSB, as collateral agent (in such capacity, herein the “Collateral Agent”)
for the benefit of the Holders of notes issued by Ambassadors International, Inc. (the
“Company”), the Pledgor has granted to the Collateral Agent, for the benefit of the
Holders, a security interest in and to, among other things, the Pledgor’s inventory, credit card
receivables, certain accounts, books and records relating to the foregoing, and proceeds therefrom,
including without limitation, all amounts due or to become due from the Processor to the Pledgor
pursuant to the Processing Agreement between the Processor and the Pledgor.



Under the terms and provisions of the agreements with the Collateral Agent, the Pledgor has
pledged all proceeds of the Pledgor’s accounts, accounts receivable and inventory to the Collateral
Agent. Such proceeds include all credit card charges (the “Charges”) submitted by the
Pledgor to the Processor for processing and the amounts which the Processor owes to the Pledgor on
account thereof (the “Credit Card Proceeds”) and all other amounts due or to become due to
the Pledgor under the Processing Agreement.



Upon receipt by the Processor of notification from the Collateral Agent as provided below, the
Processor shall transfer all amounts due from time to time from the Processor to the Pledgor
(including Credit Card Proceeds, payment from any reserve account or the like or other payments)
only as follows:



By ACH, Depository Transfer Check, or Electronic Depository Transfer to:



	 	 	 	 	 
	 

	 	Bank Name:
	 	[                    ]
	 

	 	Location:
	 	[                    ]
	 

	 	ABA Routing No.:
	 	[                    ]
	 

	 	Credit Account No.:
	 	[                    ]
	 

	 	Reference:
	 	[                    ]






 


Ex. 8-1









 





After the Processor receives notification from the Collateral Agent, all amounts shall be
transferred as the Processor may be instructed from time to time in writing by the Collateral
Agent. After the Processor receives notification from the Collateral Agent that all obligations of
the Pledgor to the Holders have been paid in full, all amounts shall be transferred as the
Processor may be instructed from time to time in writing by the Pledgor.



Upon request of the Collateral Agent, a copy of each periodic statement provided by the
Processor to the Pledgor shall be provided to the Collateral Agent at the following address (which
address may be changed upon seven (7) days written notice given to the Processor by the Collateral
Agent):



	 	 	 	 	 
	 

	 	Wilmington Trust FSB
	 	 
	 

	 	[                    ]
	 	 
	 

	 	[                    ]
	 	 
	 

	 	Attention: [                    ]
	 	 
	 

	 	Facsimile No.: [                    ]
	 	 






The Processor shall be fully protected by Company in acting on any written order or direction
by the Collateral Agent given in accordance with the terms of this letter respecting the Charges
and the Credit Card Proceeds without making any inquiry whatsoever as to the Collateral Agent’s
right or authority to give such order or direction or as to the application of any payment made
pursuant thereto, provided that the Processor does not act with gross negligence, bad faith or
willful misconduct.



The Pledgor and the Processor each hereby confirm and agree that a true and correct copy of
the Processing Agreement as in effect on the date hereof is attached hereto as Exhibit A
and that no default has occurred and is continuing thereunder or circumstances exist which would
mature into a default thereunder upon notice, lapse of time or both.



This letter may be amended only by notice in writing signed by the Pledgor, the Collateral
Agent, and the Processor, and may be terminated solely by written notice signed by the Collateral
Agent.



Please acknowledge your receipt and agreement to the terms and provisions of this letter by
executing this letter in the space provided on the following page.



[Remainder of Page Intentionally Left Blank]




 


Ex. 8-2









 








	 	 	 	 	 	 
	 	 	Very truly yours,	 
	 
	 	 	[name of applicable Pledgor]	 
	 
	 	 	 	 	 
	 

	 	By:  	 	 	 
	 

	 	 	 	 
	 

	 	 	Name:  	 	 
	 

	 	 	 	 	 
	 

	 	 	Title:	 	 
	 

	 	 	 	 	 
	 
	 	 	 	 	 
	 	 	WILMINGTON TRUST FSB, as Collateral Agent	 
	 
	 	 	 	 	 
	 

	 	By:	 	 	 
	 

	 	 	 	 
	 

	 	 	Name:	 	 
	 

	 	 	 	 	 
	 

	 	 	Title:	 	 
	 

	 	 	 	 	 






	 	 	 	 	 
	Acknowledged and Agreed to	 	 
	this [___] day of [                    , 20___]	 	 
	 
	 	 	 	 
	[PROCESSOR]	 	 
	 
	 	 	 	 
	By:  
	 	 	 	 
	 

	 

	 	 
	 	Name:  
	 	 	 
	 

	 	 

	 	 
	 	Title:
	 	 	 
	

	 	 

	 	 






 


Ex. 8-3









 





Exhibit A to Credit Card Notification




PROCESSOR AGREEMENT





 


Ex. 8-4