Exhibit








Exhibit 10.2


SECURITY AND PLEDGE AGREEMENT


THIS SECURITY AND PLEDGE AGREEMENT (as amended, modified, extended, restated, renewed, replaced, or supplemented from time to time, this “Agreement”) is entered into as of August 23, 2017 among INSEEGO CORP., a Delaware corporation (the “Borrower”), the other parties identified as “Grantors” on the signature pages hereto and such other parties that may become Grantors hereunder after the date hereof (together with the Borrower, each individually a “Grantor”, and collectively, the “Grantors”) and CANTOR FITZGERALD SECURITIES, in its capacity as collateral agent for the Secured Parties (in such capacity, the “Collateral Agent”).
    
RECITALS


WHEREAS, pursuant to that certain Credit Agreement, dated as of the date hereof (as amended, modified, extended, restated, renewed, replaced, or supplemented from time to time, the “Credit Agreement”) among the Borrower, the Guarantors party thereto from time to time, Cantor Fitzgerald Securities, as Administrative Agent and Collateral Agent, and the Lenders party thereto from time to time, the Lenders have agreed to make the Loan upon the terms and subject to the conditions set forth therein; and


WHEREAS, this Agreement is required by the terms of the Credit Agreement.


NOW, THEREFORE, in consideration of these premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:


1.    Definitions.


(a)    Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to such terms in the Credit Agreement.   With reference to this Agreement, unless otherwise specified herein:  (i) the definitions of terms herein shall apply equally to the singular and plural forms of the terms defined, (ii) whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms, (iii) the words “include”, “includes” and “including” shall be deemed to be followed by the phrase “without limitation”, (iv) the word “will” shall be construed to have the same meaning and effect as the word “shall”, (v) any definition of, or reference to, any agreement, instrument or other document herein shall be construed as referring  to  such  agreement,  instrument  or  other  document,  as  from  time  to  time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein), (vi) any reference herein to any Person shall be construed to include such Person’s permitted successors and assigns, (vii) the words “herein”, “hereof” and “hereunder”, and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (viii) all references herein to Sections, Exhibits and Schedules shall be construed to refer to Sections of, and Exhibits and Schedules to, this Agreement, (ix) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer  to  any  and  all  tangible  and  intangible  assets  and  properties,  including  cash, securities, accounts and contract rights, (x) the term “documents” includes any and all instruments, documents, agreements, certificates, notices, reports, financial statements and other writings, however evidenced, whether in physical or electronic form, (xi) in the computation of periods of time from a specified date to a later specified date, the word “from” means “from and including;” the words “to” and “until” each mean “to but excluding;” and the word “through” means “to and including”, (xii) Section headings herein  are  included  for  convenience  of  reference  only  and  shall  not  affect  the interpretation of this Agreement and (xiii) where the context requires, terms relating to the Collateral or any part thereof, when used in relation to a Grantor, shall refer to such Grantor’s Collateral or the relevant 











part thereof.


(b)    The following terms shall have the meanings set forth in the UCC (defined below):  Accession, Account, Account Debtor, Adverse Claim, As-Extracted Collateral, Certificated Security, Chattel Paper, Commercial Tort Claim, Deposit Account, Document,  Electronic  Chattel  Paper,  Equipment,  Farm  Products,  Financial  Asset, Fixtures, General Intangible, Goods, Instrument, Inventory, Investment Company Security, Investment Property, Letter-of-Credit Right, Manufactured Home, Payment Intangible, Proceeds, Securities Account, Securities Intermediary, Security, Software, Supporting Obligation and Tangible Chattel Paper.


(c)    In addition, the following terms shall have the meanings set forth below:


“Assignment of Claims Act” means the Assignment of Claims Act of 1940 (41U.S.C. Section 15, 31 U.S.C.  Section 3737, and 31 U.S.C. Section 3727), including all amendments thereto and regulations promulgated thereunder.


“Collateral” has the meaning provided in Section 2 hereof.


“Control” means the manner in which “control” is achieved under the UCC with respect to any Collateral for which the UCC specifies a method of achieving “control”.


“Copyright License” means any agreement, now or hereafter in existence, providing for the grant by, or to, any Grantor of any rights (including, without limitation, any rights for a party to be designated as an author or owner and/or to enforce, defend, use, display, copy, manufacture, distribute, exploit and sell, make derivative works, and require joinder in suit and/or receive assistance from another party) covered in whole or in part by a Copyright.


“Copyrights” means: (i) all copyrights, rights and interests in such copyrights, works protectable by copyright, copyright registrations and copyright applications anywhere in the world, (ii) all derivative works, counterparts, extensions and renewals of any of the foregoing, (iii) all income, royalties, damages and payments now or hereafter due and/or payable under any of the foregoing or with respect to any of the foregoing, including, without limitation, damages or payments for past, present and future infringements, violations or misappropriations of any of the foregoing, (iv) the right to sue for past, present and future infringements, violations or misappropriations of any of the foregoing and (v) all rights corresponding to any of the foregoing throughout the world.


“Government Contract” means a contract between any Grantor and an agency, department or instrumentality of the United States or any state Governmental Authority located in the United States or all obligations of any such Governmental Authority arising under any Account now or hereafter owing by any such Governmental Authority, as Account Debtor, to any Grantor.


“Intellectual Property” means:  all intellectual and similar property of every kind and nature, including (i) all systems software and applications software (including source code and object code), all documentation for such software, including, without limitation, user manuals, flowcharts, functional specifications, operations manuals, and all formulas, processes, ideas and know-how embodied in any of the foregoing, (ii) concepts, discoveries,  improvements  and  ideas,  know-how,  technology,  reports,  design information,   trade   secrets,   practices,   specifications,   test   procedures,   maintenance manuals, research and development, inventions (whether or not patentable), blueprints, drawings, data, customer lists, catalogs, and all physical embodiments of the foregoing, (iii) Patents, Copyrights, Trademarks, and domain names and (iv) all related registrations for any of the foregoing.


“Intellectual Property License” means any Patent License, Copyright License, Trademark  License  or  other  license  or  sublicense  agreement,  now  or  hereafter  in existence, to which any 











Grantor is a party.


“Intercompany Note” means the intercompany note substantially in the form of Exhibit E or otherwise in form and substance reasonably satisfactory to the Required Lenders.


“Issuer” means (i) with respect to any Pledged Equity, the issuer of such Pledged Equity and (ii) with respect to any Pledged Debt, the debtor in respect of such Pledged Debt.


“Patent License” means any agreement, now or hereafter in existence, providing for the grant by, or to, any Grantor of any rights (including, without limitation, the right for a party to be designated as an owner and/or to enforce, defend, make, have made, make improvements, manufacture, use, sell, import, export, and require joinder in suit and/or receive assistance from another party) covered in whole or in part by a Patent.


“Patents” means: (i) all patents, inventions and patent applications anywhere in the world, (ii) all improvements, counterparts, reissues, divisional, re-examinations, extensions, continuations (in whole or in part) and renewals of any of the foregoing and improvements thereon, (iii) all income, royalties, damages or payments now or hereafter due and/or payable under any of the foregoing or with respect to any of the foregoing, including, without limitation, damages or payments for past, present or future infringements, violations or misappropriations of any of the foregoing, (iv) the right to sue for past, present and future infringements, violations or misappropriations of any of the foregoing and (v) all rights corresponding to any of the foregoing throughout the world.


“Pledged  Collateral”  means,  collectively,  the  Pledged  Debt  and  the  Pledged Equity.


“Pledged Debt” means, with respect to each Grantor, (i) the loans and advances made by, and the debt securities owned by, such Grantor (in each case whether or not evidenced by any promissory note or other instrument), including the Intercompany Note and the other Indebtedness owned by the Grantors as set forth on Schedule 11 to the Perfection Certificate (as updated from time to time in accordance with the Credit Agreement) and (ii) the promissory notes and any other instruments evidencing such loans, advances and debt securities; provided that the Pledged Debt shall not include any Excluded Property.


“Pledged Equity” means, with respect to each Grantor, all Equity Interests (other than Excluded Equity Interests) held by such Grantor, including the Equity Interests owned by such Grantor as set forth on Schedule 14 to the Perfection Certificate (as updated from time to time in accordance with the Credit Agreement), in each case together with the certificates (or other agreements or instruments), if any, representing such  shares,  and  all  options and other rights, contractual or  otherwise,  with respect thereto, including, but not limited to, the following:


(1)    all   Equity   Interests   (other   than   Excluded   Equity   Interests) representing a dividend thereon, or representing a distribution or return of capital upon or in respect thereof, or resulting from a stock split, revision, reclassification or other exchange therefor, and any subscriptions, warrants, rights or options issued to the holder thereof, or otherwise in respect thereof; and


(2)    in the event of any consolidation or merger involving any Issuer and in which such Issuer is not the surviving Person, all shares of each class of the Equity Interests (other than Excluded Equity Interests) of the successor Person formed by or resulting from such consolidation or merger, to the extent that such successor Person is a Subsidiary of a Grantor.


“Registered Intellectual Property” has the meaning provided in Section 3(l)(i) hereof.













“Trademark License” means any agreement, now or hereafter in existence, providing for the grant by, or to, any Grantor of any rights in (including, without limitation, the right for a party to be designated as an owner and/or to enforce, defend, use, mark, police, and require joinder in suit and/or receive assistance from another party) covered in whole, or in part, by a Trademark.


“Trademarks” means: (i) all trademarks, trade names, corporate names, company names, business names, fictitious business names, internet domain names, trade styles, service marks, logos, other business identifiers, whether registered or unregistered, all registrations  and  recordings  thereof,  and  all  applications  in  connection  therewith anywhere in the world, (ii) all counterparts, extensions and renewals of any of the foregoing, (iii) all income, royalties, damages and payments now or hereafter due and/or payable under any of the foregoing or with respect to any of the foregoing, including, without limitation, damages or payments for past, present or future infringements, violations, dilutions or misappropriations of any of the foregoing, (iv) the right to sue for past, present or future infringements, violations, dilutions or misappropriations of any of the foregoing and (v) all rights corresponding to any of the foregoing (including all goodwill connected with the use of and/or symbolized by the foregoing) throughout the world.


“UCC” means the Uniform Commercial Code as in effect from time to time in the state of New York except as such term may be used in connection with the perfection of the Collateral and then the applicable jurisdiction with respect to such affected Collateral shall apply.


“USPTO” means the United States Patent and Trademark Office.


“Vehicles” means all cars, trucks, trailers, construction and earth moving equipment and other vehicles covered by a certificate of title under the laws of any state, all tires and all other appurtenances to any of the foregoing.


“Vessel” means any watercraft or other artificial contrivance used, or capable of being used, as a means of transportation on water (including, without limitation, those whose primary purpose is the maritime transportation of cargo or which are otherwise engaged, used or useful in any business activities of the Grantors) which are owned by and registered (or to be owned and registered) in the name of any of the Grantors, including, without limitation, any Vessel leased or otherwise registered in the foregoing parties’ names, pursuant to a lease or other operating agreement constituting a capital lease obligation, in each case together with all related spares, equipment and any additional improvements, vessel owned, bareboat chartered or operated by a Grantor other than Vessels owned by an entity other than a Grantor and which are managed under Vessel management agreements.


2.    Grant of Security Interest in the Collateral.  To secure the prompt payment and performance in full when due, whether by lapse of time, acceleration, mandatory prepayment or otherwise, of the Secured Obligations, each Grantor hereby grants to the Collateral Agent, for the benefit of the Secured Parties, a continuing security interest in any and all right, title and interest of such Grantor in and to all of the following, whether now owned or existing or owned, acquired, or arising hereafter (collectively, the “Collateral”):  (a) all Accounts; (b) all cash, currency and Cash Equivalents; (c) all Chattel Paper (including Electronic Chattel Paper and Tangible Chattel Paper); (d) those certain Commercial Tort Claims set forth on Schedule 3 to the Perfection Certificate (as updated from time to time in accordance with the Credit Agreement); (e) all Deposit Accounts; (f) all Documents; (g) all Equipment; (h) all Fixtures; (i) all General Intangibles;  (j)  all  Goods;  (k)  all  Instruments;  (l)  all  Intellectual  Property  and  Intellectual Property Licenses; (m) all Inventory; (n) all Investment Property; (o) all Letter-of-Credit Rights; (p)  all  Payment  Intangibles;  (q)  all  Pledged  Collateral;  (r)  all  Securities  Accounts;  (s)  all Software; (t) all Supporting Obligations; (u) all Vehicles; (v) all books and records pertaining to the Collateral; (w) all Accessions and all Proceeds and products of any and all of the foregoing and (x) all other personal property of any kind or type whatsoever now or hereafter owned by such Grantor or as to which such Grantor now or hereafter has the power to 











transfer interest therein.


Notwithstanding anything to the contrary contained herein, the security interests granted under this Agreement shall not extend to any Excluded Property; provided, that with respect to any property constituting Excluded Property described in clause (d) of the definition thereof, in the event of the termination or elimination of any prohibition or right or requirement for any consent or other limitation with respect to such property as set forth in such clause (d), to the extent  sufficient  to  permit  any  such  property  to  become  Collateral  hereunder,  or  upon  the granting of any such consent, or waiving or terminating any requirement for such consent or such other limitation, a security interest in such property shall be automatically and simultaneously granted  and  shall  be  included  as  Collateral  hereunder,  and  such  property  shall  no  longer constitute “Excluded Property” hereunder or under the other Loan Documents.


The Grantors and the Collateral Agent, on behalf of the Secured Parties, hereby acknowledge and agree that the security interest created hereby in the Collateral (a) constitutes continuing  collateral  security  for  all  of  the  Secured  Obligations,  whether  now  existing  or hereafter arising and (b) is not to be construed as an assignment of any Intellectual Property.


3.    Representations and Warranties.  Each Grantor hereby represents and warrants to the Collateral Agent, for the benefit of the Secured Parties, that until the Facility Termination Date, that:


(a)    Ownership.    Each  Grantor  is  the  legal  and  beneficial  owner  of  its Collateral, free and clear of all Liens (other than Permitted Liens), and has the right to pledge, sell, assign or transfer the same.  There exists no Adverse Claim with respect to the Pledged Equity of such Grantor.


(b)    Security Interest/Priority.  This Agreement creates a valid security interest in favor of the Collateral Agent, for the benefit of the Secured Parties, in the Collateral of such  Grantor  and,  when  properly  perfected  by  filing,  shall  constitute  a  valid  and perfected, first priority security interest in such Collateral (including all uncertificated Pledged Equity consisting of partnership or limited liability company interests that do not constitute Securities), to the extent such security interest can be perfected by making the filings set forth in Section 4(d) hereof, free and clear of all Liens except for Permitted Liens.   No Grantor has authenticated any agreement authorizing any secured party thereunder to file a financing statement, except to perfect Permitted Liens.  The taking possession by the Collateral Agent of the certificated securities (if any) evidencing the Pledged Equity and all other Instruments constituting Collateral will perfect and establish the first priority of the Collateral Agent’s security interest in all the Pledged Equity evidenced by such certificated securities and such Instruments.  With respect to any Collateral consisting of a Deposit Account, Securities Entitlement or held in a Securities Account, upon execution and delivery by the applicable Grantor, the applicable Securities Intermediary and the Lender of an agreement granting control to the Collateral Agent over such Collateral, the Lender shall have a valid and perfected, first priority security interest in such Collateral.


(c)    Types of Collateral.  None of the Collateral consists of, or is the Proceeds of,  (i)  As-Extracted  Collateral,  (ii)  Farm  Products,  (iii)  Manufactured  Homes,  (iv) standing timber, (v) an aircraft, airframe, aircraft engine or related property, (vi) an aircraft leasehold interest, (vii) a Vessel or (viii) any other interest in or to any of the foregoing.


(d)    Accounts.  (i) Each Account of the Grantors and the papers and documents relating thereto are in all material respects what they purport to be, (ii) each Account arises out of (A) a bona fide sale of goods sold and delivered by such Grantor (or is in the process of being delivered) or (B) services theretofore actually rendered by such Grantor to, the account debtor named therein, (iii) no Account of a Grantor is evidenced by any Instrument or Chattel Paper unless such Instrument or Chattel Paper, to the extent requested by the Collateral Agent or the Required Lenders, has been 











endorsed over and delivered to, or submitted to the control of, the Collateral Agent, (iv) no surety bond was required or given in connection with any Account of a Grantor or the contracts or purchase orders out of which they arose, and (v) to our knowledge, no Account Debtor has any defense, set-off, claim or counterclaim against any Grantor that can be asserted against the Collateral Agent, whether in any proceeding to enforce the Collateral Agent’s rights in the Collateral otherwise, except defenses, setoffs, claims or counterclaims that are not, in the aggregate, material to the value of the Accounts.


(e)    Equipment  and  Inventory.     With  respect  to  any  Equipment  and/or Inventory of a Grantor, each such Grantor has exclusive possession and control of such Equipment  and  Inventory  of  such  Grantor  except  for  (i)  Equipment  leased  by  such Grantor as a lessee, (ii) Equipment or Inventory in transit with common carriers or (iii) Equipment and/or Inventory in the possession or control of a warehouseman, bailee or any agent or processor of such Grantor.  No Inventory of a Grantor is held by a Person other than a Grantor pursuant to consignment, sale or return, sale on approval or similar arrangement.  Collateral consisting of Inventory is of good and merchantable quality, free from material defects.  The completion of the manufacturing process of such Inventory by a Person other than the applicable Grantor would be permitted under any contract to which such Grantor is a party or to which the Inventory is subject.


(f)    Authorization of Pledged Collateral.   All Pledged Equity (i) is duly authorized  and  validly  issued,  (ii)  is  fully  paid  and,  to  the  extent  applicable, nonassessable  and  is  not  subject  to  the  preemptive  rights  of  any  Person,  (iii)  is beneficially owned as of record by a Grantor and (iv) constitutes all the issued and outstanding shares of all classes of the equity of such Issuer issued to such Grantor to the extent required to be pledged hereunder. All Pledged Debt is the legal, valid and binding obligation of the Issuers and any obligors thereof, except to the extent that enforceability of such obligations may be limited by applicable bankruptcy, insolvency, and other similar laws affecting creditor’s rights generally.


(g)    No Other Equity Interests, Instruments, Etc.   As of the Closing Date, (i) no Grantor owns any certificated Equity Interests in any Subsidiary that are required to be pledged and delivered to the Collateral Agent hereunder except as set forth on Schedule 14 to the Perfection Certificate (as updated from time to time in accordance with the Credit Agreement), and (ii) no Grantor holds any Instruments, Documents or Tangible Chattel Paper required to be pledged and delivered to the Lender pursuant to Section 4(c)(i) of this Agreement other than as set forth on Schedule 11 to the Perfection Certificate (as updated from time to time in accordance with the Credit Agreement). All such certificated securities, Instruments, Documents and Tangible Chattel Paper have been delivered to the Collateral Agent to the extent (A) requested by the Collateral Agent or the Required Lenders or (B) as required by the terms of this Agreement and the other Loan Documents.


(h)    Partnership  and  Limited  Liability  Company  Interests.    None  of  the Collateral consisting of an interest in a partnership or a limited liability company (i) is dealt in or traded on a securities exchange or in a securities market, (ii) by its terms expressly provides that it is a Security governed by Article 8 of the UCC, (iii) is an Investment Company Security, (iv) is held in a Securities Account or (v) constitutes a Security or a Financial Asset.


(i)    Perfection Certificate and Other Information Regarding Collateral.  The Perfection  Certificate  has  been  duly  prepared,  completed  and  executed  and  the information set forth therein is correct and complete in all material respects as of the date hereof.


(j)    Consents; Etc.   No approval, consent, exemption, authorization or other action by, notice to, or filing with, any Governmental Authority or any other Person (including, without limitation, any stockholder, member or creditor of such Grantor), is necessary or required for (i) the grant by such Grantor of the security interest in the Collateral granted hereby or for the execution, 











delivery or performance of this Agreement by such Grantor, (ii) the perfection of such security interest (to the extent such security interest can be perfected by filing under the UCC, the granting of control (to the extent required under Section 4(c) hereof) or by filing an appropriate notice with the USPTO or the United States Copyright Office) or (iii) the exercise by the Collateral Agent or the Secured Parties of the rights and remedies provided for in this Agreement (including, without limitation, as against any Issuer), except for (A) the filing or recording of UCC financing statements or other filings under the Assignment of Claims Act, (B) the filing of appropriate notices with the USPTO and the United States Copyright Office, (C) obtaining control to perfect the Liens created by this Agreement (to the extent required under Section 4(c) hereof), (D) such actions as may be required by Laws affecting the offering and sale of securities, (E) such actions as may be required by applicable foreign Laws affecting the pledge of the Pledged Equity of Foreign Subsidiaries, (F) consents, authorizations, filings or other actions which have been obtained or made, or the failure of which to obtain are not reasonably likely to cause a Material Adverse Effect and (G) as may be required with respect to Vehicles registered under a certificate of title.


(k)    Commercial Tort Claims.  As of the Closing Date, no Grantor has any Commercial Tort Claims seeking damages in excess of $250,000 other than as set forth on Schedule 3 to the Perfection Certificate (as updated from time to time in accordance with the Credit Agreement).


(l)    Copyrights, Patents and Trademarks.


(i)    All Intellectual Property registered or applied for with any Governmental Authority (“Registered Intellectual Property”) and that are owned by such Grantor is subsisting, and, to the extent registered, is enforceable, and, to such Grantor’s knowledge, is valid.


(ii)    No holding, decision or judgment has been rendered against a Grantor by any Governmental Authority that would limit, cancel or question the validity of any Registered Intellectual Property owned by any Grantor in any material respect.


(iii)    Each Grantor and each of its Subsidiaries, own, or possess the right to use, all of the material Intellectual Property that is reasonably necessary for   the   operation   of   their   respective   businesses,   without   any   material infringement,  misappropriation  or  other  violation  of  the  rights  of  any  other Person.


(iv)    No proceeding, claim or litigation regarding any of the foregoing is pending or, to the knowledge of such Grantor, threatened, which, either individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.


(v)    As  of  the  Closing  Date,  no  Grantor  owns  any  Registered Intellectual  Property  and/or  is  party  to  any  exclusive  Intellectual  Property License  under  which  such  Grantor  is  the  licensee  of  any  registration  or application for any Copyright, except as set forth in Schedule 12 to the Perfection Certificate.


4.    Covenants. Each Grantor covenants that until the Facility Termination Date, that such Grantor shall:


(a)    Maintenance of Perfected Security Interest; Further Information.


(i)    Maintain the security interest created by this Agreement as a first priority perfected security interest (subject only to Permitted Liens) and shall defend such security interest against the claims and demands of all Persons whomsoever (other than the holders of Permitted Liens).













(ii)    From time to time furnish to the Collateral Agent (for distribution to the Lenders) upon the reasonable request of the Collateral Agent or the Required Lenders, statements and schedules further identifying and describing the assets and property of such Grantor and such other reports in connection therewith  as  the  Collateral  Agent  or  the  Required  Lenders  may  reasonably request, all in reasonable detail.


(b)    Required Notifications.  Each Grantor shall promptly notify the Collateral Agent (with such notice provided by the Collateral Agent  to the Lenders) in writing, of: (i) any Lien (other than Permitted Liens) on any of the Collateral which would materially and adversely affect the ability of the Collateral Agent to exercise any of its remedies hereunder and (ii) the occurrence of any other event which could reasonably be expected to have a material impairment on the aggregate value of the Collateral or on the security interests created hereby.


(c)    Perfection through Possession and Control.


(i)    If  any  amount  in  excess  of  $250,000  payable  under  or  in connection with any of the Collateral shall be or become evidenced by any Instrument or Tangible Chattel Paper or Supporting Obligation, ensure that such Instrument, Tangible Chattel Paper or Supporting Obligation is either in the possession of such Grantor at all times or, if requested by the Collateral Agent or the Required Lenders to perfect the security interest provided hereunder in such Collateral, delivered to the Collateral Agent duly endorsed in a manner satisfactory  to  the  Collateral  Agent.     Such  Grantor  shall  ensure  that  any Collateral  consisting  of  Tangible  Chattel  Paper  is  marked  with  a  legend acceptable to the Collateral Agent indicating the Collateral Agent’s security interest  in  such  Tangible  Chattel  Paper.     To  the  extent  the  value  of  all Instruments, Supporting Obligation and Tangible Chattel Paper not in the possession of the Collateral Agent exceeds $250,000, at the request of the Collateral Agent or the Required Lenders, the Grantors shall deliver such Instruments, Supporting Obligations and Tangible Chattel Paper to the Collateral Agent so that the value of all Instruments, Supporting Obligations and Tangible Chattel Paper not in the possession of the Collateral Agent does not exceed $250,000.


(ii)    Deliver to the Collateral Agent promptly upon the receipt thereof by or on behalf of a Grantor, (x) all promissory notes and other instruments constituting Pledged Debt with a value that exceeds, individually, or in the aggregate, $250,000 and (y) all certificates and other instruments constituting Certificated Securities or Pledged Equity hereunder; provided that with respect to the certificates evidencing the Pledged Equity of any Foreign Subsidiary, such certificates shall be delivered to the Collateral Agent in accordance with Section 6.17 of the Credit Agreement.  Prior to delivery to the Collateral Agent, all such promissory notes, certificates and other instruments constituting Pledged Collateral shall be held in trust by such Grantor for the benefit of the Collateral Agent and the Secured Parties pursuant hereto.   All such promissory notes, certificates and other instruments representing such Pledged Collateral shall be delivered in suitable form for transfer by delivery or shall be accompanied by duly executed instruments of transfer or assignment in blank, substantially in the form provided in Exhibit A-1 or A-2, as applicable, hereto.


(iii)    If any Collateral shall consist of Deposit Accounts, Electronic Chattel Paper, Letter-of-Credit Rights, Securities Accounts or uncertificated Investment Property, execute and deliver (and, with respect to any Collateral consisting of uncertificated Investment Property, cause the Issuer with respect to such Investment Property to execute and deliver) to the Collateral Agent all control agreements, assignments, instruments or other documents as reasonably requested by the Collateral Agent or the Required Lenders 











for the purposes of obtaining and maintaining Control of such Collateral.  If any Collateral shall consist of Deposit Accounts or Securities Accounts, comply with Section 6.13(d) of the Credit Agreement with respect to such Collateral.


(d)    Filing of Financing Statements, Notices, etc.  Each Grantor shall execute and deliver to the Collateral Agent and/or file such agreements, assignments or instruments (including affidavits, notices, reaffirmations and amendments and restatements of existing documents, as the Collateral Agent or the Required Lenders may reasonably request) and do all such other things as the Lender may reasonably deem necessary or appropriate (i) to assure the validity and perfection of the Collateral Agent’s security interests hereunder, including (A) such instruments as the Collateral Agent or the Required Lenders may from time to time reasonably request in order to perfect and maintain the security interests granted hereunder in accordance with the UCC, including, without limitation, financing statements (including continuation statements), (B) with regard to Copyrights, a Notice of Grant of Security Interest in Copyrights for filing with the United States Copyright Office substantially in the form of Exhibit B or other form acceptable to the Collateral Agent, (C) with regard to Patents, a Notice of Grant of Security Interest in Patents for filing with the USPTO substantially in the form of Exhibit C or other form acceptable to the Lender and (D) with regard to Trademarks, a Notice of Grant of Security Interest in Trademarks for filing with the USPTO substantially in the form of Exhibit D or other form acceptable to the Collateral Agent, (ii) to consummate the transactions contemplated hereby and (iii) to otherwise protect and assure the Collateral Agent’s rights and interests hereunder.  Furthermore, each Grantor also hereby irrevocably makes, constitutes and appoints the Collateral Agent, its nominee or any other person whom the Collateral Agent may designate, as such Grantor’s attorney in fact with full power and for the limited purpose to prepare and file (and, to the extent applicable, sign) in the name of such Grantor any financing statements, or amendments and supplements to financing statements, renewal financing statements, notices or any similar  documents  which  in  the  Collateral  Agent’s  reasonable  discretion  (or  the reasonable discretion of the Required Lenders) would be necessary or appropriate in order to perfect and maintain perfection of the security interests granted hereunder, such power, being coupled with an interest, being and remaining irrevocable until the Facility Termination Date.  Each Grantor hereby agrees that a carbon, photographic or other reproduction of this Agreement or any such financing statement is sufficient for filing as a financing statement by the Collateral Agent without notice thereof to such Grantor wherever the Collateral Agent or the Required Lenders may in their reasonable discretion desire to file the same.


(e)    Collateral Held By Warehouseman, Bailee, etc.  Perfect and protect such Grantor’s ownership interests in all Inventory stored with a consignee against creditors of the consignee by filing and maintaining financing statements against the consignee reflecting the consignment arrangement filed in all appropriate filing offices, providing any written notices required by the UCC to notify any prior creditors of the consignee of the consignment arrangement, and taking such other actions as may be appropriate to perfect  and  protect  such  Grantor’s  interests  in  such  inventory  under  Section  2-326, Section 9-103, Section 9-324 and Section 9-505 of the UCC or otherwise, which such financing statements filed pursuant to this Section shall be assigned to the Collateral Agent, for the benefit of the Secured Parties.


(f)    Treatment of Accounts.  Not grant or extend the time for payment of any Account, or compromise or settle any Account for less than the full amount thereof, or release any person or property, in whole or in part, from payment thereof, or amend, supplement or modify any Account in any manner that could reasonably be likely to adversely affect the value thereof, or allow any credit or discount thereon, other than, in the case of any of the foregoing, in the ordinary course of a Grantor’s business.


(g)    Commercial   Tort   Claims.      Execute   and   deliver   such   statements, documents and notices and do and cause to be done all such things as may be required by the Collateral Agent, 











or required by Law, to create, preserve, perfect and maintain the Collateral Agent’s security interest in any Commercial Tort Claims seeking damages in excess of $250,000 initiated by or in favor of any Grantor.


(h)    Inventory. With respect to the Inventory of each Grantor:


(i)    At all times maintain inventory records in the ordinary course of business.


(ii)    Produce, use, store and maintain the Inventory in accordance in all  material  respects  with  applicable  standards  of  any  insurance  and  in compliance in all material respects with applicable Laws (including the requirements of the Federal Fair Labor Standards Act of 1938, as amended and all rules, regulations and orders related thereto).


(i)    Reserved.


(j)    Nature of Collateral.   At all times maintain the Collateral as personal property and not affix any material portion of the Collateral to any real property in a manner which would change its nature from personal property to real property or a Fixture to real property, unless the Lender shall have a perfected Lien on such Fixture or real property.


(k)    Issuance or Acquisition of Equity Interests in Partnerships or Limited Liability Companies.


(i)    Not without executing and delivering, or causing to be executed and delivered, to the Collateral Agent such agreements, documents and instruments as the Collateral Agent or the Required Lenders may reasonably require,  issue  or  acquire  any  Pledged  Equity  consisting  of  an  interest  in  a partnership or a limited liability company that (A) is dealt in or traded on a securities exchange or in a securities market, (B) by its terms expressly provides that it is a Security governed by Article 8 of the UCC, (C) is an investment company  security,  (D)  is  held  in  a  Securities  Account  or  (E)  constitutes  a Security or a Financial Asset.


(ii)    Without the prior written consent of the Collateral Agent, no Grantor will (A) vote to enable, or take any other action to permit, any applicable Issuer  to  issue  any  Investment  Property  or  Equity  Interests  constituting partnership or limited liability company interests, except for those additional Investment  Property  or  Equity  Interests  constituting  partnership  or  limited liability company interests that will be subject to the security interest granted herein in favor of the Secured Parties, or (B) enter into any agreement or undertaking, except in connection with a Disposition permitted under Section 7.5 of the Credit Agreement, restricting the right or ability of such Grantor or the Collateral Agent to sell, assign or transfer any Investment Property or Pledged Equity or Proceeds thereof.  The Grantors will defend the right, title and interest of the Collateral Agent in and to any Investment Property and Pledged Equity against the claims and demands of all Persons whomsoever.


(iii)    If any Grantor shall become entitled to receive or shall receive (A) any Certificated Securities (including, without limitation, any certificate representing a stock dividend or a distribution in connection with any reclassification, increase or reduction of capital or any certificate issued in connection with any reorganization), option or rights in respect of the ownership interests of any Issuer, whether in addition to, in substitution of, as a conversion of, or in exchange for, any Investment Property, or otherwise in respect thereof, or (B) any sums paid upon or in respect of any Pledged Collateral or any Investment Property upon the liquidation or dissolution of any Issuer, to the extent required to be paid 











to the Lenders in accordance with Section 2.5(b) of the Credit Agreement, such Grantor shall accept the same as the agent of the Secured Parties, hold the same in trust for the Secured Parties, segregated from other funds of such Grantor, and promptly deliver the same to the Collateral Agent, on behalf of the Secured parties, in accordance with the terms hereof.


(l)    Intellectual Property.


(i)    Not do any act or omit to do any act whereby any material Copyright may become invalidated and (A) not do any act, or omit to do any act, whereby any material Copyright may become injected into the public domain, except for occasional releases of software code not material to the operation of such Grantor’s business as open source software, subject to such Grantor’s reasonable business judgment; (B) notify the Collateral Agent (who shall notify the Lenders) immediately if it knows that any material Copyright may become injected into the public domain or of any materially adverse determination or development (including, without limitation, the institution of, or any such determination or development in, any court or tribunal in the United States or any other country) regarding a Grantor’s ownership of any such Copyright or its validity; (C) take all necessary steps as such Grantor shall reasonably deem appropriate to maintain and pursue each application (and to obtain the relevant registration) of each material Copyright owned by a Grantor and to maintain each registration of each material Copyright owned by a Grantor including, without limitation, filing of applications for renewal where necessary; and (D) promptly notify the Collateral Agent (who shall notify the Lenders) of any material infringement, misappropriation, dilution or impairment of any Copyright of a Grantor of which it becomes aware and take such actions as it shall reasonably deem appropriate under the circumstances to protect such Copyright, including, where appropriate, the bringing of suit for infringement, dilution or impairment or seeking injunctive relief and seeking to recover any and all damages for such infringement, misappropriation, dilution or impairment.


(ii)    Grant  to  the  Collateral  Agent  a  non-exclusive,  royalty-free license to use, license or sublicense such Grantor’s Intellectual Property (with respect to Trademarks, subject to reasonable quality control) for the purpose of enabling to exercise the Collateral Agent’s rights hereunder, exercisable only after the occurrence and during the continuance of an Event of Default; provided, however, that (i) no such license or agreement granting such Grantor rights in third party’s Intellectual Property shall be deemed granted to the extent granting such license is prohibited according to the terms of any license agreement to which the Grantor is a party or otherwise bound and (ii) such license will terminate on the termination of this agreement and the indefeasible payment in full of all Secured Obligations.


(iii)    (A) Subject to such Grantor’s reasonable business judgment, continue to use each material Trademark of such Grantor on each and every trademark class of goods applicable to its current line as reflected in its current catalogs, brochures and price lists in order to maintain such Trademark in full force free from any claim of abandonment for non-use, (B) subject to such Grantor’s reasonable business judgment, maintain as in the past the quality of products and services offered under each such Trademark, (C) employ each such Trademark with the appropriate notice of registration, if applicable, (D) not adopt or use any mark that is confusingly similar or a colorable imitation of any such Trademark unless the Collateral Agent, for the benefit of the Secured Parties, shall obtain a perfected security interest in such mark pursuant to this Agreement, and (E) subject to such Grantor’s reasonable business judgment, not (and not permit any licensee or sublicensee thereof to) do any act or omit to do any act whereby any such Trademark may become invalidated.













(iv)    Not knowingly do any act, or omit to do any act, whereby any material Patent may become abandoned or dedicated.


(v)    Promptly  notify  the  Collateral  Agent  (who  shall  notify  the Lenders) immediately if it knows that any application or registration relating to any material Patent or Trademark may become abandoned or dedicated, or of any materially adverse determination or development (including, without limitation, the institution of, or any such determination or development in, any proceeding in the USPTO or any court or tribunal in any country) regarding such Grantor ownership of any Patent or Trademark or its right to register the same or to keep and maintain the same.


(vi)    Take all necessary steps as such Grantor shall deem appropriate under the circumstances, including, without limitation, in any proceeding before the USPTO, or any similar office or agency in any other country or any political subdivision thereof, to maintain and pursue each application (and to obtain the relevant registration) and to maintain each registration of each material Patent and Trademark, including, without limitation, filing of applications for renewal, affidavits of use and affidavits of incontestability.


(vii)    Promptly  notify  the  Collateral  Agent  (who  shall  notify  the Lenders)  after  such  Grantor  learns  that  any  material  Patent  or  Trademark included in the Collateral is infringed, misappropriated, diluted or impaired by a third party and promptly sue for infringement, misappropriation, dilution or impairment, to seek injunctive relief where appropriate and to recover any and all damages for such infringement, misappropriation, dilution  or impairment, or to take such other actions as such Grantor or the Required Lenders shall reasonably deem appropriate under the circumstances to protect such Patent or Trademark.


(viii)    In the event that such Grantor, either directly or through any agent, employee, licensee or designee, (A) files an application for the registration of (or otherwise becomes the owner of) any Patent, Trademark or Copyright with the USPTO, United States Copyright Office or other applicable Governmental Authority, (B) acquires any registration or application for registration of any Patent, Trademark or Copyright or (C) acquires or becomes a party to any exclusive Intellectual Property License under which such Grantor is the licensee of any registration or application for any Copyright, provide the Collateral Agent written notice thereof each fiscal quarter, concurrently with delivery of the Compliance Certificate as required under Section 6.2(b) of the Credit Agreement, and, upon request of the Collateral Agent, promptly execute and deliver any and all security agreements or other instruments as the Collateral Agent may reasonably request to evidence the Collateral Agent’s security interest in such Patent, Trademark, Copyright or exclusive Intellectual Property License, and the General Intangibles of such Grantor relating thereto or represented thereby.


(ix)    Not  make  any  assignment  or  agreement  in  conflict  with  the security interest in the Copyrights, Patents or Trademarks of each Grantor hereunder (except as permitted by the Credit Agreement).


Notwithstanding the foregoing, the Grantors may, in their reasonable business judgment, to the extent consistent with past practice, fail to maintain, pursue, preserve or protect any Copyright, Patent or Trademark which is not material to their businesses.


(m)    Equipment.  Maintain each item of Equipment in good working order and condition (reasonable wear and tear and obsolescence excepted).













(n)    Further  Assurances.     Promptly  upon  the  reasonable  request  of  the Collateral Agent or the Required Lenders and at the sole expense of the Grantors, duly execute and deliver, and have recorded, such further instruments and documents and take such further actions as the Collateral Agent or the Required Lenders may reasonably request for the purpose of obtaining or preserving the full benefits of this Agreement and of the rights and powers herein granted, including, without limitation, (A) with respect to Government Contracts, assignment agreements and notices of assignment, in form and substance satisfactory to the Required Lenders, duly executed by any Grantors party to such Government Contract in compliance with the Assignment of Claims Act (or analogous state applicable Law), and (B) all applications, certificates, instruments, registration statements, and all other documents and papers the Collateral Agent or the Required Lenders may reasonably request and as may be required by law in connection with the obtaining of any consent, approval, registration, qualification, or authorization of any Person deemed necessary or appropriate for the effective exercise of any rights under this Agreement; provided that no Grantor shall be required to take any action to perfect a security interest in any Collateral if the costs and burdens to the Grantors of perfecting a security interest in such Collateral (including any applicable stamp, intangibles or other taxes) are excessive in relation to value to the Lenders afforded thereby as determined by the Required Lenders in their reasonable discretion.


5.    Authorization to File Financing Statements.  Each Grantor hereby authorizes the Collateral Agent and the Lenders to prepare and file such financing statements (including continuation statements) or amendments thereof or supplements thereto or other instruments as the Collateral Agent or the Required Lenders may from time to time deem necessary or appropriate  in  order  to  perfect  and  maintain  the  security  interests  granted  hereunder  in accordance with the UCC, which such financing statements may describe the Collateral in the same manner as described herein or may contain an indication or description of Collateral that describes such property in any other manner as the Collateral Agent or the Required Lenders may  determine,  in  their  sole  discretion,  is  necessary,  advisable  or  prudent  to  ensure  the perfection of the security interest in the Collateral granted herein, including, without limitation, describing  such  property  as  “all  assets,  whether  now  owned  or  hereafter  acquired”  or  “all personal property, whether now owned or hereafter acquired.”


6.    Advances.    On  failure  of  any  Grantor  to  perform  any  of  the  covenants  and agreements contained herein or in any other Loan Document, the Required Lenders may, at their option and in their sole discretion, instruct the Collateral Agent to perform the same and in so doing may expend such sums as the Required Lenders may reasonably deem advisable in the performance thereof, including, without limitation, the payment of any insurance premiums, the payment of any taxes, a payment to obtain a release of a Lien or potential Lien, expenditures made in defending against any adverse claim and all other expenditures which the Collateral Agent and the Required Lenders may make for the protection of the security hereof or which may be compelled to make by operation of Law.  All such sums and amounts so expended shall be repayable by the Grantors on a joint and several basis promptly upon timely notice thereof and demand therefor, shall constitute additional Secured Obligations and shall bear interest from the date said amounts are expended at the Default Rate.  No such performance of any covenant or agreement by the Collateral Agent on behalf of any Grantor, and no such advance or expenditure therefor, shall relieve the Grantors of any Default or Event of Default.  The Required Lenders may instruct the Collateral Agent to make any payment hereby authorized in accordance with any bill, statement or estimate procured from the appropriate public office or holder of the claim to be discharged without inquiry into the accuracy of such bill, statement or estimate or into the validity of any tax assessment, sale, forfeiture, tax lien, title or claim except to the extent such payment is being contested in good faith by a Grantor in appropriate proceedings and against which adequate reserves are being maintained in accordance with GAAP.





















7.    Remedies.


(a)    General Remedies.   Upon the occurrence of an Event of Default and during continuation thereof, the Collateral Agent on behalf of the Secured Parties shall have, in addition to the rights and remedies provided herein, in the Loan Documents, in any other documents relating to the Secured Obligations, or by any applicable Law (including,  but  not  limited  to,  levy  of  attachment,  garnishment  and  the  rights  and remedies set forth in the UCC of the jurisdiction applicable to the affected Collateral), the rights and remedies of a secured party under the UCC (regardless of whether the UCC is the law of the jurisdiction where the rights and remedies are asserted and regardless of whether the UCC applies to the affected Collateral), and further, the Collateral Agent may, with or without judicial process or the aid and assistance of others, (i) enter on any premises on which any of the Collateral may be located and, without resistance or interference by the Grantors, take possession of the Collateral, (ii) dispose of any Collateral on any such premises, (iii) require the Grantors to assemble and make available to the Collateral Agent at the expense of the Grantors any Collateral at any place and time designated by the Collateral Agent which is reasonably convenient to the parties, (iv) remove any Collateral from any such premises for the purpose of effecting the sale or other disposition thereof, or (v) without demand and without advertisement, notice, hearing or process of law, all of which each of the Grantors hereby waives to the fullest extent permitted by Law, at any place and time or times, sell, lease, assign, give option or options to purchase, or otherwise dispose of and deliver the Collateral or any part thereof (or contract to do any of the foregoing), in one or more parcels any or all Collateral held by or for it at public or private sale (which in the case of a private sale of Pledged Equity, shall be to a restricted group of purchasers who will be obligated to agree, among other things, to acquire such securities for their own account, for investment and not with a view  to  the  distribution  or  resale  thereof),  at  any  exchange  or  broker’s  board  or elsewhere, by one or more contracts, in one or more parcels, for money, upon credit or otherwise, at such prices and upon such terms as the Collateral Agent deems advisable, in its sole discretion (subject to any and all mandatory legal requirements). Each Grantor acknowledges that any such private sale may be at prices and on terms less favorable to the seller than the prices and other terms which might have been obtained at a public sale and, notwithstanding the foregoing, agrees that such private sale shall be deemed to have been made in a commercially reasonable manner and, in the case of a sale of Pledged Equity, that the Collateral Agent shall have no obligation to delay sale of any such securities for the period of time necessary to permit the Issuer of such securities to register such securities for public sale under the Securities Act of 1933.  The Collateral Agent and the Lenders shall have the right upon any such public sale or sales, and, to the extent permitted by applicable Law, upon any such private sale or sales, to purchase the whole or any part of the Collateral so sold.  Neither the Collateral Agent’s compliance with applicable Law nor its disclaimer of warranties relating to the Collateral shall be considered to adversely affect the commercial reasonableness of any sale.  To the extent the rights of notice cannot be legally waived hereunder, each Grantor agrees that any requirement of reasonable notice shall be met if such notice, specifying the place of any public sale or the time after which any private sale is to be made, is personally served on or mailed, postage prepaid, to the Borrower in accordance with the notice provisions of Section 10.2 of the Credit Agreement at least 10 days before the time of sale or other event giving rise to the requirement of such notice.  Each Grantor further acknowledges and agrees that any offer to sell any Pledged Equity which has been (A) publicly advertised on a bona fide basis in a newspaper or other publication of general circulation in the financial community of New York, New York (to the extent that such offer may be advertised without prior registration under the Securities Act of 1933), or (B) made privately in the manner described above shall be deemed to involve a “public sale” under the UCC, notwithstanding that such sale may not constitute a “public offering” under the Securities Act of 1933, and the Collateral Agent and the Lenders may, in such event, bid for the purchase of such securities.  The Collateral Agent shall not be obligated to make any sale or other disposition of the Collateral regardless of notice having been given.  To the extent permitted by applicable Law, any Secured Party may be a purchaser at any such sale.   To the extent permitted by applicable Law, each of the Grantors hereby waives 











all of its rights of redemption with respect to any such sale.  Subject to the provisions of applicable Law, the Collateral Agent may postpone or cause the postponement of the sale of all or any portion of the Collateral by announcement at the time and place of such sale, and such sale may, without further notice, to the extent permitted by Law, be made at the time and place to which the sale was postponed, or the Collateral Agent may further postpone such sale by announcement made at such time and place.  To the extent permitted by applicable Law, each Grantor waives all claims, damages and demands it may acquire against the Collateral Agent or any other Secured Party arising out of the exercise by them of any rights hereunder except to the extent (a) any such claims, damages or demands result solely from the gross negligence or willful misconduct of the Collateral Agent or such other Secured Party as determined by a final non-appealable judgment of a court of competent jurisdiction, in each case against whom such claim is asserted, or (b) arise from a dispute among such parties (other than such disputes involving claims against the Collateral Agent in its capacity as such) that do not involve an act or omission by the Borrower or any other Grantor.  Each Grantor agrees that the internet shall constitute a “place” for purposes of Section 9-610(b) of the UCC and that any sale of Collateral to a licensor pursuant to the terms of a license agreement between such licensor and a Grantor is sufficient to constitute a commercially reasonable sale (including as to method, terms, manner, and time) within the meaning of Section 9-610 of the UCC.


(b)    Remedies Relating to Accounts.  Upon the occurrence and during the continuation of an Event of Default:


(i)    Whether or not the Collateral Agent or any other Secured Party has exercised any or all of its rights and remedies hereunder, (A) at the request of the Collateral Agent each Grantor shall notify (such notice to be in form and substance satisfactory to the Required Lenders) its Account Debtors that such Accounts have been assigned to the Collateral Agent, for the benefit of Secured Parties, and promptly upon the request of the Collateral Agent (acting on the written instructions of the Required Lenders), instruct all Account Debtors to remit all payments in respect of Accounts to a mailing location selected by the Collateral Agent and the Required Lenders and (B) the Collateral Agent (acting on  the  written  instructions  of  the  Required  Lenders)  shall  have  the  right  to enforce any Grantor’s rights against its customers and account debtors, and the Collateral Agent (acting on the written instructions of the Required Lenders) or its designee may notify any Grantor’s customers and account debtors that the Accounts of such Grantor have been assigned to the Collateral Agent or of the Collateral Agent’s security interest therein, and may (either in its own name or in the name of a Grantor or both) demand, collect (including without limitation by way of a lockbox arrangement), receive, take receipt for, sell, sue for, compound, settle,  compromise  and  give  acquittance  for  any  and  all  amounts  due  or  to become due on any Account, and, the Collateral Agent (acting on the written instructions of the Required Lenders) may file any claim or take any other action or proceeding to protect and realize upon the security interest granted hereunder.


(ii)    Each Grantor acknowledges and agrees that the Proceeds of its Accounts remitted to or on behalf of the Collateral Agent in accordance with the provisions hereof shall be solely for the Collateral Agent’s own convenience and that such Grantor shall not have any right, title or interest in such Accounts or in any such other amounts except as expressly provided herein.   Neither the Collateral Agent nor the other Secured Parties shall have any liability or responsibility to any Grantor for acceptance of a check, draft or other order for payment of money bearing the legend “payment in full” or words of similar import or any other restrictive legend or endorsement or be responsible for determining the correctness of any remittance.


(iii)    (A)  the  Collateral  Agent  shall  have  the  right,  but  not  the obligation, to make test verifications of the Accounts in any manner and through any medium that it 











reasonably considers advisable, and the Grantors shall furnish all such assistance and information as the Collateral Agent (acting on the written instructions of the Required Lenders) may require in connection with such test verifications, (B) upon the Required Lender’s request and at the expense of the Grantors, the Grantors shall cause independent public accountants or others satisfactory to the Required Lenders to furnish to the Collateral Agent for distribution to the Lenders, reports showing reconciliations, aging and test verifications of, and trial balances for, the Accounts and (C) the Collateral Agent (acting on the written instructions of the Required Lenders) in its own name or in the name of others may communicate with account debtors on the Accounts to verify with them to the Collateral Agent’s satisfaction the existence, amount and terms of any Accounts.


(iv)    Upon  the  request  of  the  Collateral  Agent,  each  Grantor  shall forward to the Collateral Agent for distribution to the Lenders, on the last Business Day of each week, deposit slips related to all cash, money, checks or any other similar items of payment received by the Grantor during such week, and, if requested by the Collateral Agent (acting on the written instructions of the Required Lenders), copies of such checks or any other similar items of payment, together with a statement showing the application of all payments on the Collateral during such week and a collection report with regard thereto, in form and substance satisfactory to the Required Lenders.


(c)    Deposit Accounts/Securities Accounts.  Upon the occurrence of an Event of Default and during continuation thereof, the Collateral Agent may prevent withdrawals or other dispositions of funds in Deposit Accounts and Securities Accounts subject to control agreements or held with any Secured Party.


(d)    Investment Property/Pledged Collateral.  Upon the occurrence of an Event of Default and during the continuation thereof:  at the request of the Collateral Agent, the Collateral Agent shall have the right to receive any and all cash dividends, interest, principal, other payments or distributions made in respect of any Investment Property or Pledged Collateral or other Proceeds paid in respect of any Investment Property or Pledged Collateral, and any or all of any Investment Property or Pledged Collateral may, at the option of the Required Lenders, be registered in the name of the Collateral Agent or its nominee, and the Collateral Agent or its nominee may thereafter exercise (in each case subject to the consent of the Required Lenders) (i) all voting, corporate and other rights pertaining to such Investment Property, or any such Pledged Equity at any meeting of shareholders, partners or members of the relevant Issuers or otherwise and (ii) any and all rights of conversion, exchange and subscription and any other rights, privileges or options pertaining to such Investment Property or Pledged Collateral as if it were the absolute owner thereof (including, without limitation, the right to exchange at its discretion any and all of the Investment Property or Pledged Collateral upon the merger, consolidation, reorganization, recapitalization or other fundamental change in the corporate, partnership or limited liability company structure of any Issuer or upon the exercise  by  any  Grantor  or  the  Collateral  Agent  of  any  right,  privilege  or  option pertaining  to  such  Investment  Property  or  Pledged  Collateral,  and  in  connection therewith, the right to deposit and deliver any and all of the Investment Property or Pledged Collateral with any committee, depositary, transfer agent, registrar or other designated agency upon such terms and conditions as the Collateral Agent may determine), all without liability except to account for property actually received by the Collateral Agent; provided that no Secured Party shall have any duty to any Grantor to exercise  any  such  right,  privilege  or  option  and  the  Collateral  Agent  and  the  other Secured Parties shall not be responsible for any failure to do so or delay in so doing.  In furtherance thereof, each Grantor hereby authorizes and instructs each Issuer with respect to any Collateral consisting of Investment Property and/or Pledged Collateral to (A) comply with any instruction received by it from the Collateral Agent in writing that (1) states that an Event of Default has occurred and is continuing and (2) is otherwise in accordance with the terms of this Agreement, without any other or further instructions from such Grantor, and each Grantor agrees that each Issuer shall be fully 











protected in so complying following receipt of such notice and prior to notice that such Event of Default is no longer continuing, and (B) except as otherwise expressly permitted hereby, upon the request of the Collateral Agent, pay any dividends, interest, principal or other payments or distributions with respect to any Investment Property or Pledged Collateral directly to the Collateral Agent.  Unless an Event of Default shall have occurred and be continuing and the Collateral Agent shall have given notice to the relevant Grantor of the intent to exercise the rights pursuant to this Section 7, each Grantor shall be permitted to receive all cash dividends, interest, principal, or other payments or distributions made in respect of any Investment Property and any Pledged Collateral to the extent permitted in the Credit  Agreement,  and  to  exercise  all  voting  and  other  corporate,  company  and partnership rights with respect to any Investment Property and Pledged Collateral to the extent not inconsistent with the terms of this Agreement and the other Loan Documents; provided further that all dividends, interest, principal or other payments or distributions received by any Grantor contrary to the provisions of this Section 7(d) shall be held in trust for the benefit of the Collateral Agent and the Secured Parties, shall be segregated from other property or funds of such Grantor and shall be promptly (and in any event within three days or such longer period as the Required Lenders may agree in their reasonable discretion) delivered to the Collateral Agent upon demand in the same form as so received (with any necessary endorsement reasonably requested by the Collateral Agent or the Required Lenders).


(e)    Access.   In addition to the rights and remedies hereunder, upon the occurrence of an Event of Default and during the continuance thereof, the Collateral Agent (acting on the written instructions of the Required Lenders) shall have the right to enter and remain upon the various premises of the Grantors without cost or charge to the Secured Parties, and use the same, together with materials, supplies, books and records of the Grantors for the purpose of collecting and liquidating the Collateral, or for preparing for sale and conducting the sale of the Collateral, whether by foreclosure, auction or otherwise.  In addition, the Collateral Agent may remove Collateral, or any part thereof, from such premises and/or any records with respect thereto, in order to effectively collect or liquidate such Collateral.  If the Collateral Agent exercises the right to take possession of the Collateral, each Grantor shall also at its expense perform any and all other steps reasonably requested by the Collateral Agent (acting on the written instructions of the Required Lenders) to preserve and protect the security interest hereby granted in the Collateral, such as placing and maintaining signs indicating the security interest of the Collateral Agent, appointing overseers for the Collateral and maintaining inventory records.


(f)    Nonexclusive Nature of Remedies.  Failure by the Collateral Agent or any of the other Secured Parties to exercise any right, remedy or option under this Agreement, any other Loan Document, any other document relating to the Secured Obligations, or as provided by Law, or any delay by the Collateral Agent or such other Secured Parties in exercising the same, shall not operate as a waiver of any such right, remedy or option. No waiver hereunder shall be effective unless it is in writing, signed by the party against whom such waiver is sought to be enforced and then only to the extent specifically stated, which in the case of the Collateral Agent or such other Secured Parties shall only be granted as provided herein.  To the extent permitted by Law, neither the Collateral Agent, the other Secured Parties, nor any party acting as attorney for the Collateral Agent or such other Secured Parties, shall be liable hereunder for any acts or omissions or for any error of judgment or mistake of fact or law other than (i) such Person’s gross negligence or willful misconduct hereunder as determined by a final non-appealable judgment of a court of competent jurisdiction or (ii) in connection with a dispute among such parties (other than such disputes involving claims against the Collateral Agent in its capacity as such) that do not involve an act or omission by the Borrower or any other Grantor.  The rights and remedies of the Collateral Agent and the other Secured Parties under this Agreement shall be cumulative and not exclusive of any other right or remedy which the Collateral Agent or the other Secured Parties may have.















(g)    Retention of Collateral.  In addition to the rights and remedies hereunder, Collateral Agent may, in compliance with Sections 9-620 and 9-621 of the UCC or otherwise complying with the requirements of applicable Law of the relevant jurisdiction, accept or retain the Collateral in satisfaction of the Secured Obligations.  Unless and until the Collateral Agent shall have provided such notices, however, no Secured Party shall be deemed to have retained any Collateral in satisfaction of any Secured Obligations for any reason.


(h)    Waiver; Deficiency.  Each Grantor hereby waives, to the extent permitted by applicable Laws, all rights of redemption, appraisement, valuation, stay, extension or moratorium now or hereafter in force under any applicable Laws in order to prevent or delay the enforcement of this Agreement or the absolute sale of the Collateral or any portion thereof.  In the event that the proceeds of any sale, collection or realization are insufficient to pay all amounts to which the Collateral Agent and the other Secured Parties are legally entitled, the Grantors shall be jointly and severally liable for the deficiency, together with interest thereon at the Default Rate, together with the costs of collection and the fees, charges and disbursements of counsel.   Any surplus remaining after the full payment and satisfaction of the Secured Obligations shall be returned to the Grantors  or  to  whomsoever  a  court  of  competent  jurisdiction  shall  determine  to  be entitled thereto.


(i)    Registration Rights. Upon the occurrence and during the continuation of an Event of Default:


(i)    If the Required Lenders shall determine, as set forth  in a written notice to the Collateral Agent and the Borrower, that in order to exercise the right to sell any or all of the Collateral it is necessary or advisable to have such Collateral registered under the provisions of the Securities Act (any such Collateral, the “Restricted Securities Collateral”), the relevant Grantor will cause each applicable Issuer (and the officers and directors thereof) that is a Grantor or a Subsidiary of a Grantor to (A) execute and deliver all such instruments and documents, and do or cause to be done all such other acts as may be, in the opinion of the Required Lenders, necessary or advisable to register such Restricted Securities Collateral, or that portion thereof to be sold, under the provisions of the Securities Act, (B) use its commercially reasonable efforts to cause  the  registration  statement  relating  thereto  to  become  effective  and  to remain effective for a period of one year from the date of the first public offering of such Restricted Securities Collateral, or that portion thereof to be sold, and (C) make all amendments thereto and/or to the related prospectus which, in the opinion of the Required Lenders, are necessary or advisable, all in conformity with the requirements of the Securities Act and the rules and regulations of the Securities and Exchange Commission applicable thereto.  Each Grantor agrees to cause each applicable Issuer (and the officers and directors thereof) to comply with the provisions of the securities or “Blue Sky” laws of any and all jurisdictions which the Required Lenders shall designate and to make available to its security holders, as soon as practicable, an earnings statement (which need not be audited) which will satisfy the provisions of the Securities Act.


(ii)    Each Grantor agrees to use its commercially reasonable efforts to do or cause to be done all such other acts as may be necessary to make such sale or sales of all or any portion of the Restricted Securities Collateral valid and binding and in compliance with any and all other applicable Laws.  Each Grantor further agrees that a breach of any of the covenants contained in this Section 7 will  cause  irreparable  injury  to  the  Collateral  Agent  and  the  other  Secured Parties, that the Collateral Agent and the other Secured Parties have no adequate remedy at law in respect of such breach and, as a consequence, that each and every covenant contained in this Section 7 shall be specifically enforceable against such Grantor, and such Grantor 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 under the Credit Agreement.













8.    Rights of the Collateral Agent.


(a)    Power of Attorney.   In addition to other powers of attorney contained herein, each Grantor hereby designates and appoints the Collateral Agent, on behalf of the Secured Parties, and each of its designees or agents, as attorney-in-fact of such Grantor, irrevocably and with power of substitution, with authority to take any or all of the following actions upon the occurrence and during the continuance of an Event of Default:


(i)    to demand, collect, settle, compromise, adjust, give discharges and releases, all as the Collateral Agent (acting on the written instructions of the Required Lenders) may reasonably determine;


(ii)    to  commence  and  prosecute  any  actions  at  any  court  for  the purposes of collecting any Collateral and enforcing any other right in respect thereof;


(iii)    to defend, settle or compromise any action brought and, in connection therewith, give such discharge or release as the Collateral Agent (acting  on  the  written  instructions  of  the  Required  Lenders)  may  deem reasonably appropriate;


(iv)    to receive, open and dispose of mail addressed to a Grantor and endorse checks, notes, drafts, acceptances, money orders, bills of lading, warehouse receipts or other instruments or documents evidencing payment, shipment or storage of the goods giving rise to the Collateral of such Grantor on behalf of and in the name of such Grantor, or securing, or relating to such Collateral;


(v)    to sell, assign, transfer, make any agreement in respect of, or otherwise deal with or exercise rights in respect of, any Collateral or the goods or services which have given rise thereto, as fully and completely as though the Collateral Agent were the absolute owner thereof for all purposes;


(vi)    to adjust and settle claims under any insurance policy relating thereto;


(vii)    to execute and deliver all assignments, conveyances, statements, financing statements, continuation financing statements, security agreements, affidavits, notices and other agreements, instruments and documents that the Collateral Agent may determine necessary in order to perfect and maintain the security interests and liens granted pursuant to this Agreement and in order to fully consummate all of the transactions contemplated herein;


(viii)    to  institute  any  foreclosure  proceedings  that  the  Lender  may deem appropriate;


(ix)    to  sign  and  endorse  any  drafts,  assignments,  proxies,  stock powers, verifications, notices and other documents relating to the Collateral;


(x)    to exchange any of the Pledged Collateral or other property upon any merger, consolidation, reorganization, recapitalization or other readjustment of the Issuer thereof and, in connection therewith, deposit any of the Pledged Collateral with any committee, depository, transfer agent, registrar or other designated agency upon such terms as the Collateral Agent may reasonably deem appropriate;


(xi)    to vote for a shareholder resolution, or to sign an instrument in writing, 











sanctioning the transfer of any or all of the Pledged Collateral into the name of the Collateral Agent or one or more of the Secured Parties or into the name of any transferee to whom the Pledged Collateral or any part thereof may be sold pursuant to Section 7 hereof;


(xii)    to pay or discharge taxes, liens, security interests or other encumbrances levied or placed on or threatened against the Collateral;


(xiii)    to direct any parties liable for any payment in connection with any of the Collateral to make payment of any and all monies due and to become due thereunder directly to the Collateral Agent or as the Required Lenders shall direct;


(xiv)    to receive payment of and receipt for any and all monies, claims, and other amounts due and to become due at any time in respect of or arising out of any Collateral;


(xv)    in the case of any Intellectual Property, execute and deliver, and have recorded, any and all agreements, instruments, documents and papers as the Lender may request to evidence the security interests created hereby in such Intellectual Property and the goodwill and General Intangibles of such Grantor relating thereto or represented thereby; and


(xvi)    do and perform all such other acts and things as the Collateral Agent or the Required Lenders may reasonably deem to be necessary, proper or convenient in connection with the Collateral.


This power of attorney is a power coupled with an interest and shall be irrevocable until the Facility Termination Date.  Neither the Collateral Agent nor any of the other Secured Parties shall be under any duty to exercise or withhold the exercise of any of the rights, powers, privileges and options expressly or implicitly granted to the Collateral Agent or such other Secured Parties under this Agreement, and shall not be liable for any failure to do so or any delay in doing so.  Neither the Collateral Agent nor any of the other Secured Parties shall be liable for any act or omission or for any error of judgment or any mistake of fact or law in its individual capacity or its capacity as attorney-in-fact except acts or omissions resulting from its gross negligence or willful misconduct as determined by a final non-appealable judgment of a court of competent jurisdiction.   This power of attorney is conferred on the Collateral Agent solely to protect, preserve and realize upon the security interest in the Collateral provided hereunder and shall not impose any duty upon the Collateral Agent or any other Secured Party to exercise any such powers.


(b)    Assignment by the Lender. The Collateral Agent may from time to time assign the Secured Obligations to a successor Collateral Agent to the extent permitted by, and appointed in accordance with, the Credit Agreement and such successor shall be entitled to all of the rights and remedies of the Collateral Agent under this Agreement and the other Loan Documents in relation thereto.


(c)    The  Collateral  Agent’s  Duty  of  Care.     Other  than  the  exercise  of reasonable care to assure the safe custody of the Collateral while being held by the Collateral  Agent  hereunder,  the  Collateral  Agent  shall  have  no  duty  or  liability  to preserve rights pertaining thereto, it being understood and agreed that the Grantors shall be responsible for preservation of all rights in the Collateral, and the Collateral Agent shall be relieved of all responsibility for the Collateral upon surrendering it or tendering the surrender of it to the Grantors.  The Collateral Agent shall be deemed to have exercised reasonable care in the custody and preservation of the Collateral in its possession if the Collateral is accorded treatment substantially equal to that which the Collateral Agent accords its own property, which shall be no less than the treatment employed by a reasonable and prudent agent in the industry, it being understood that the Collateral Agent shall not have responsibility for 











taking any necessary steps to preserve rights against any parties with respect to any of the Collateral.  In the event of a public or private sale of Collateral pursuant to Section 7 hereof, the Collateral Agent shall have no responsibility for (i) ascertaining or taking action with respect to calls, conversions, exchanges, maturities, tenders or other matters relating to any Collateral, whether or not the Collateral Agent has or is deemed to have knowledge of such matters, or (ii) taking any steps to clean, repair or otherwise prepare the Collateral for sale.


(d)    Liability with Respect to Accounts.   Anything herein to the contrary notwithstanding, each of the Grantors shall remain liable under each of the Accounts to observe and perform all the conditions and obligations to be observed and performed by it thereunder, all in accordance with the terms of any agreement giving rise to each such Account.  Neither the Collateral Agent nor any other Secured Party shall have any obligation or liability under any Account (or any agreement giving rise thereto) by reason of or arising out of this Agreement or the receipt by the Collateral Agent or any other Secured Party of any payment relating to such Account pursuant hereto, nor shall the Collateral Agent or any other Secured Party be obligated in any manner to perform any of the obligations of a Grantor under or pursuant to any Account (or any agreement giving rise thereto), to make any payment, to make any inquiry as to the nature or the sufficiency of any payment received by it or as to the sufficiency of any performance by any party under any Account (or any agreement giving rise thereto), to present or file any claim, to take any action to enforce any performance or to collect the payment of any amounts which may have been assigned to it or to which it may be entitled at any time or times.


(e)    Releases of Collateral.


(i)    If any Collateral shall be sold, transferred or otherwise disposed of by any Grantor in a transaction permitted by the Credit Agreement (other than to a Person that is, or that is required to be, in each case, at the time of such sale, transfer or other disposition, a Loan Party (but disregarding the grace period provided for therein)), then, subject to Section 11.11 of the Credit Agreement, the Collateral Agent shall promptly, and at the request and sole expense of such Grantor, execute and deliver to such Grantor all releases and other documents, and take such other action, reasonably necessary for the release of the Liens created hereby or by any other Collateral Document on such Collateral.


(ii)    Subject to Section 11.11 of the Credit Agreement, the Collateral Agent may release any of the Pledged Equity from this Agreement or may substitute any of the Pledged Equity for other Pledged Equity without altering, varying or diminishing in any way the force, effect, lien, pledge or security interest of this Agreement as to any Pledged Equity not expressly released or substituted, and this Agreement shall continue as a first priority lien, subject only to Permitted Liens, on all Pledged Equity not expressly released or substituted.


9.    Application of Proceeds.  After the exercise of remedies provided for in Section 8.2 of the Credit Agreement (or after the Loan has automatically become immediately due and payable as set forth in Section 8.2 of the Credit Agreement) any payments in respect of the Secured Obligations and any proceeds of the Collateral, when received by the Lender or any Secured  Party  in  cash  or  Cash  Equivalents  will  be  applied  in  reduction  of  the  Secured Obligations in the order set forth in Section 8.3 of the Credit Agreement.


10.    Continuing Agreement.


(a)    This Agreement shall remain in full force and effect until the Facility Termination Date, at which time this Agreement shall be automatically terminated (other than obligations under this Agreement which expressly survive such termination) and the Collateral Agent shall, upon the 











request and at the expense of the Grantors, forthwith release all of its liens and security interests hereunder and shall execute and deliver all UCC  termination  statements  and/or  other  documents  reasonably  requested  by  the Grantors evidencing such termination.


(b)    This  Agreement  shall  continue  to  be  effective  or  be  automatically reinstated, as the case may be, if at any time payment, in whole or in part, of any of the Secured Obligations is rescinded or must otherwise be restored or returned by the Collateral Agent or by any other Secured Party as a preference, fraudulent conveyance or otherwise under any Debtor Relief Law, all as though such payment had not been made; provided that in the event payment of all or any part of the Secured Obligations is rescinded or must be restored or returned, all reasonable costs and expenses (including without limitation any reasonable legal fees and disbursements) incurred by the Collateral Agent or by any other Secured Party in defending and enforcing such reinstatement shall be deemed to be included as a part of the Secured Obligations.


11.    Amendments; Waivers; Modifications, etc.   This Agreement and the provisions hereof may not be amended, waived, modified, changed, discharged or terminated except as set forth in Section 10.1 of the Credit Agreement.


12.    Successors in Interest.  This Agreement shall be binding upon each Grantor, its permitted successors and assigns and shall inure, together with the rights and remedies of the Lender and the Secured Parties hereunder, to the benefit of the Lender and the Secured Parties and their successors and permitted assigns.


13.    Notices.  All notices required or permitted to be given under this Agreement shall be in conformance with Section 10.2 of the Credit Agreement; provided that notices and communications to the Grantors shall be directed to the Grantors, at the address of the Borrower set forth in Section 10.2 of the Credit Agreement.


14.    Counterparts.   This Agreement may be executed in any number of counterparts, each of which where so executed and delivered shall be an original, but all of which shall constitute one and the same instrument.  It shall not be necessary in making proof of this Agreement to produce or account for more than one such counterpart.  Delivery of an executed counterpart of a signature page of this Agreement by fax transmission or other electronic mail transmission  (e.g.  “pdf”  or  “tif”)  shall  be  effective  as  delivery  of  a  manually  executed counterpart of this Agreement.  Without limiting the foregoing, to the extent a manually executed counterpart is not specifically required to be delivered, upon the request of any party, such fax transmission  or  electronic  mail  transmission  shall  be  promptly  followed  by  such  manually executed counterpart.


15.    Headings.  The headings of the sections hereof are provided for convenience only and shall not in any way affect the meaning or construction of any provision of this Agreement.


16.    Governing Law; Submission to Jurisdiction; Venue; WAIVER OF JURY TRIAL. The terms of Sections 10.13 and 10.14 of the Credit Agreement with respect to governing law, submission to jurisdiction, venue and waiver of jury trial are incorporated herein by reference, mutatis mutandis, and the parties hereto agree to such terms.


17.    Severability.  If any provision of this Agreement is determined to be illegal, invalid or unenforceable, such provision shall be fully severable and the remaining provisions shall remain in full force and effect and shall be construed without giving effect to the illegal, invalid or unenforceable provisions.


18.    Entirety.   This Agreement, the other Loan Documents and the other documents relating to the Secured Obligations represent the entire agreement of the parties hereto and thereto, and supersede all prior agreements and understandings, oral or written, if any, including any commitment letters or 











correspondence relating to the Loan Documents, any other documents relating to the Secured Obligations, or the transactions contemplated herein and therein.


19.    Other Security.   To the extent that any of the Secured Obligations are now or hereafter  secured  by  property  other  than  the  Collateral  (including,  without  limitation,  real property and securities owned by a Grantor), or by a guarantee, endorsement or property of any other  Person,  then  the  Collateral  Agent  shall  have  the  right  to  proceed  against  such  other property, guarantee or endorsement upon the occurrence and during the continuation of any Event of Default, and the Collateral Agent (acting on the written instructions of the Required Lenders) shall have the right, in its sole discretion, to determine which rights, security, liens, security interests or remedies the Collateral Agent shall at any time pursue, relinquish, subordinate, modify or take with respect thereto, without in any way modifying or affecting any of them or the Secured Obligations or any of the rights of the Collateral Agent or the other Secured Parties under this Agreement or under any other of the Loan Documents.


20.    Joinder.   At any time after the date of this Agreement, one or more additional Persons may become party hereto by executing and delivering to the Collateral Agent a Joinder Agreement in the form of Exhibit B to the Credit Agreement or such other form acceptable to the Required Lenders.  Immediately upon such execution and delivery of such Joinder Agreement (and without any further action), each such additional Person will become a party to this Agreement as a “Grantor” and have all of the rights and obligations of a Grantor hereunder and this Agreement and the schedules referred to herein shall be deemed amended by such Joinder Agreement.


21.    Consent of Issuers of Pledged Equity.   Notwithstanding any anti-assignment or other provisions in any operating agreement, limited partnership agreement or similar organizational or governance documents of any Loan Party that is an Issuer, such Loan Party hereby acknowledges, consents and agrees to (a) the grant of the security interests in such Pledged Equity by the applicable Grantors pursuant to this Agreement, together with all rights and remedies accompanying such security interest as provided by this Agreement and applicable Law and (b) waives any rights of first refusal or restrictions on transfer contained therein.


22.    Joint and Several Obligations of Grantors.


(a)    Each of the Grantors is accepting joint and several liability hereunder in consideration of the financial accommodations to be provided by the Lenders under the Credit Agreement, for the mutual benefit, directly and indirectly, of each of the Grantors and in consideration of the undertakings of each of the Grantors to accept joint and several liability for the obligations of each of them.


(b)    Each of the Grantors jointly and severally hereby irrevocably and unconditionally accepts, not merely as a surety but also as a primary obligor, joint and several liability with the other Grantors with respect to the payment and performance of all of the Secured Obligations, it being the intention of the parties hereto that (i) all the Secured Obligations shall be the joint and several obligations of each of the Grantors without preferences or distinction among them and (ii) a separate action may be brought against each Grantor to enforce this Agreement whether or not the Borrower, any other Grantor or any other person or entity is joined as a party.


(c)    Notwithstanding any provision to the contrary contained herein, in any other of the Loan Documents, to the extent the obligations of a Grantor shall be adjudicated to be invalid or unenforceable for any reason (including, without limitation, because of any applicable state or federal law relating to fraudulent conveyances or transfers) then the obligations of such Grantor hereunder shall be limited to the maximum amount that is permissible under applicable law (whether federal or state and including, without limitation, Debtor Relief Laws).













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


24.    Injunctive Relief.


(a)    Each Grantor recognizes that, in the event such Grantor fails to perform, observe or discharge any of its obligations or liabilities under this Agreement or any other Loan Document, any remedy of law may prove to be inadequate relief to the Lender and the other Secured Parties.  Therefore, each Grantor agrees that the Collateral Agent and the other Secured Parties, at the option of the Collateral Agent and the other Secured Parties, shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual damages.


(b)    The Collateral Agent, the other Secured Parties and each Grantor hereby agree that no such Person shall have a remedy of punitive or exemplary damages against any other party to a Loan Document and each such Person hereby waives any right or claim to punitive or exemplary damages that they may now have or may arise in the future in connection with any dispute under this Agreement or any other Loan Document, whether such dispute is resolved through arbitration or judicially.


[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]













Each of the parties hereto has caused a counterpart of this Agreement to be duly executed and delivered as of the date first above written.


		
	GRANTORS:
	INSEEGO CORP.




By:    /s/ Stephen Smith         
Name:    Stephen Smith
Title:    Chief Financial Officer




NOVATEL WIRELESS, INC.


By:    /s/ Stephen Smith         
Name:    Stephen Smith
Title:    Chief Financial Officer




ENFORA, INC.


By:    /s/ Stephen Smith         
Name:    Stephen Smith
Title:    Chief Financial Officer




R.E.R. ENTERPRISES, INC.


By:    /s/ Stephen Smith             
Name:    Stephen Smith
Title:    Chief Financial Officer




INSEEGO NORTH AMERICA, LLC


By:    /s/ Stephen Smith             
Name:    Stephen Smith
Title:    Chief Financial Officer




NOVATEL WIRELESS SOLUTIONS, INC.


By:    /s/ Stephen Smith             
Name:    Stephen Smith
Title:    Chief Financial Officer




FEENEY WIRELESS IC-DISC, INC.


By:    /s/ Stephen Smith             
Name:    Stephen Smith
Title:    Chief Financial Officer





















Accepted and agreed to as of the date first above written.


CANTOR FITZGERALD SECURITIES, as Collateral Agent


By:    /s/ Nils Horning        
Name:    Nils Horning
Title:    Vice President