**Exhibit 10.10** GUARANTEE AND COLLATERAL AGREEMENTmade bySUPERIOR OFFSHORE INTERNATIONAL, L.L.C.in favor ofWILMINGTON TRUST COMPANY,as Collateral AgentDated as of February 27, 2007 

 
TABLE OF CONTENTS           Page        SECTION 1. DEFINED TERMS  1 1.1 Definitions  1 1.2 Other Definitional Provisions  4        SECTION 2. GUARANTEE  4 2.1 Guarantee  4 2.2 Right of Contribution  5 2.3 No Subrogation  5 2.4 Amendments, etc. with respect to the Borrower Obligations  5 2.5 Guarantee Absolute and Unconditional  6 2.6 Reinstatement  6 2.7 Payments  6        SECTION 3. GRANT OF SECURITY INTEREST  6        SECTION 4. REPRESENTATIONS AND WARRANTIES  8 4.1 Title; No Other Liens  8 4.2 Perfected First Priority Liens  8 4.3 Jurisdiction of Organization; Chief Executive Office  8 4.4 RESERVED  8 4.5 Farm Products  8 4.6 Investment Property  8 4.7 Receivables  9 4.8 Intellectual Property  9 4.9 Commercial Tort Claims  9        SECTION 5. COVENANTS  10 5.1 Delivery of Instruments, Certificated Securities and Chattel Paper  10 5.2 Maintenance of Insurance  10 5.3 RESERVED  10 5.4 Maintenance of Perfected Security Interest; Further Documentation  10 5.5 Changes in Name, etc  11 5.6 RESERVED  11 5.7 Investment Property  11 5.8 Receivables  12 5.9 Intellectual Property  12 5.10 Commercial Tort Claims  13 5.11 Foreign Assets  13        SECTION 6. REMEDIAL PROVISIONS  13 6.1 Certain Matters Relating to Receivables  13 6.2 Communications with Obligors; Grantors Remain Liable  14 6.3 Pledged Stock  14 6.4 Proceeds to be Turned Over To Collateral Agent  15 6.5 Application of Proceeds  15 6.6 Code and Other Remedies  16 6.7 Registration Rights  17 
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           Page 6.8 Subordination  17 6.9 Deficiency  18        SECTION 7. THE COLLATERAL AGENT  18 7.1 Collateral Agent’s Appointment as Attorney-in-Fact, etc  18 7.2 Duty of Collateral Agent  19 7.3 Execution of Financing Statements  19 7.4 Authority of Collateral Agent  20        SECTION 8. MISCELLANEOUS  20 8.1 Amendments in Writing  20 8.2 Notices  20 8.3 No Waiver by Course of Conduct; Cumulative Remedies  20 8.4 Enforcement Expenses; Indemnification  20 8.5 Successors and Assigns  21 8.6 Set-Off  21 8.7 Counterparts  21 8.8 Severability  21 8.9 Section Headings  21 8.10 Integration  21 8.11 **GOVERNING LAW**  22 8.12 Submission To Jurisdiction; Waivers  22 8.13 Acknowledgements  22 8.14 Additional Grantors  22 8.15 Releases  23 8.16 **WAIVER OF JURY TRIAL**  23 8.17 Authority Subject to Credit Agreement  23 8.18 Intercreditor Agreement Governs  23        SCHEDULES             Schedule 1 Notice Addresses    Schedule 2 Investment Property    Schedule 3 Perfection Matters    Schedule 4 Jurisdictions of Organization and Chief Executive Offices    Schedule 5 Intellectual Property    
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 GUARANTEE AND COLLATERAL AGREEMENT          GUARANTEE AND COLLATERAL AGREEMENT, dated as of February 27, 2007, made by each of thesignatories hereto (together with any other entity that may become a party hereto as providedherein, the “Grantors”), in favor of WILMINGTON TRUST COMPANY, as Collateral Agent (in suchcapacity, together with its successors and assigns, the “Collateral Agent”) for the banksand other financial institutions or entities (the “Lenders”) from time to time parties tothe Credit Agreement, dated as of February 27, 2007 (as amended, supplemented or otherwise modifiedfrom time to time, the “Credit Agreement”), among SUPERIOR OFFSHORE INTERNATIONAL, L.L.C.,a Louisiana limited liability company (the “Borrower”), the Lenders, JPMorgan Chase Bank,N.A., as Administrative Agent (the “Administrative Agent”), and the Collateral Agent.WITNESSETH:          WHEREAS, pursuant to the Credit Agreement, the Lenders have severally agreed to makeextensions of credit to the Borrower upon the terms and subject to the conditions set forththerein; and          WHEREAS, it is a condition precedent to the obligation of the Lenders to make their respectiveextensions of credit to the Borrower under the Credit Agreement that the Grantors shall haveexecuted and delivered this Agreement to the Administrative Agent for its benefit and for thebenefit of the other Secured Parties;          NOW, THEREFORE, in consideration of the premises and to induce the Collateral Agent, theAdministrative Agent and the Lenders to enter into the Credit Agreement and to induce the Lendersto make their respective extensions of credit to the Borrower thereunder, each Grantor herebyagrees with the Collateral Agent, for its benefit and for the benefit of the other Secured Parties,as follows:SECTION 1. DEFINED TERMS     1.1 Definitions. (a) Unless otherwise defined herein, terms defined in the CreditAgreement and used herein shall have the meanings given to them in the Credit Agreement, and thefollowing terms are used herein as defined in the New York UCC: Accounts, Certificated Security,Chattel Paper, Commercial Tort Claims, Documents, Equipment, Farm Products, General Intangibles,Instruments, Inventory, Letter-of-Credit Rights and Supporting Obligations.     (b) The following terms shall have the following meanings:          “Agreement”: this Guarantee and Collateral Agreement, as the same may be amended,supplemented or otherwise modified from time to time.          “Borrower Obligations”: the collective reference to the unpaid principal of andinterest on the Loans and all other obligations and liabilities of the Borrower (including, withoutlimitation, interest accruing at the then applicable rate provided in the Credit Agreement afterthe maturity of the Loans and interest accruing at the then applicable rate provided in the CreditAgreement after the filing of any petition in bankruptcy, or the commencement of any insolvency,reorganization or like proceeding,relating to the Borrower, whether or not a claim for post-filing or post-petition interest isallowed in such proceeding) to the Collateral Agent, the Administrative Agent or any Lender,whether direct or indirect,*Signature Page to Guarantee and Collateral Agreement*

 

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absolute or contingent, due or to become due, or now existing orhereafter incurred, which may arise under, out of, or in connection with, the Credit Agreement,this Agreement, the other Loan Documents or any other document made, delivered or given inconnection with any of the foregoing, in each case whether on account of principal, interest,reimbursement obligations, fees, indemnities, costs, expenses or otherwise (including, withoutlimitation, all fees and disbursements of counsel to the Collateral Agent, to the AdministrativeAgent or to the Lenders that are required to be paid by the Borrower pursuant to the terms of anyof the foregoing agreements).          “Collateral”: as defined in Section 3.          “Collateral Account”: any collateral account established by the Collateral Agent asprovided in Section 6.1 or 6.4.          “Copyrights”: (i) all copyrights arising under the laws of the United States, anyother country or any political subdivision thereof, whether registered or unregistered and whetherpublished or unpublished (including, without limitation, those listed in Schedule 6), allregistrations and recordings thereof, and all applications in connection therewith, including,without limitation, all registrations, recordings and applications in the United States CopyrightOffice, and (ii) the right to obtain all renewals thereof.          “Copyright Licenses”: any written agreement naming any Grantor as licensor orlicensee (including, without limitation, those listed in Schedule 6), granting any right under anyCopyright, including, without limitation, the grant of rights to manufacture, distribute, exploitand sell materials derived from any Copyright.          “Deposit Account”: as defined in the Uniform Commercial Code of any applicablejurisdiction and, in any event, including, without limitation, any demand, time, savings, passbookor like account maintained with a depositary institution.          “Foreign Subsidiary”: any Subsidiary organized under the laws of any jurisdictionoutside the United States of America.          “Foreign Subsidiary Voting Stock”: the voting Capital Stock of any ForeignSubsidiary.          “Guarantor Obligations”: with respect to any Guarantor, all obligations andliabilities of such Guarantor which may arise under or in connection with this Agreement(including, without limitation, Section 2) or any other Loan Document to which such Guarantor is aparty, in each case whether on account of guarantee obligations, reimbursement obligations, fees,indemnities, costs, expenses or otherwise (including, without limitation, all fees anddisbursements of counsel to the Administrative Agent, to the Collateral Agent or to the Lendersthat are required to be paid by such Guarantor pursuant to the terms of this Agreement or any otherLoan Document).          “Guarantors”: the collective reference to each Grantor other than the Borrower.          “Intellectual Property”: the collective reference to all rights, priorities andprivileges relating to intellectual property, whether arising under United States, multinational orforeign laws or otherwise, including, without limitation, the Copyrights, the Copyright Licenses,the Patents, the Patent Licenses, the Trademarks and the Trademark Licenses, and all rights to sueat law or in equity for any infringement or other impairment thereof, including the right to receive all proceeds anddamages therefrom.

 

3          “Intercompany Note”: any promissory note evidencing loans made by any Grantor toHoldings or any of its Subsidiaries.          “Investment Property”: the collective reference to (i) all “investment property” assuch term is defined in Section 9-102(a)(49) of the New York UCC (other than any Foreign SubsidiaryVoting Stock excluded from the definition of “Pledged Stock”) and (ii) whether or not constituting“investment property” as so defined, all Pledged Notes and all Pledged Stock.          “Issuers”: the collective reference to each issuer of any Investment Property.          “New York UCC”: the Uniform Commercial Code as from time to time in effect in theState of New York.          “Obligations”: (i) in the case of the Borrower, the Borrower Obligations, and (ii) inthe case of each Guarantor, its Guarantor Obligations.          “Patents”: (i) all letters patent of the United States, any other country or anypolitical subdivision thereof, all reissues and extensions thereof and all goodwill associatedtherewith, including, without limitation, any of the foregoing referred to in Schedule 6,(ii) all applications for letters patent of the United States or any other country and alldivisions, continuations and continuations-in-part thereof, including, without limitation, any ofthe foregoing referred to in Schedule 6, and (iii) all rights to obtain any reissues orextensions of the foregoing.          “Patent License”: all agreements, whether written or oral, providing for the grant byor to any Grantor of any right to manufacture, use or sell any invention covered in whole or inpart by a Patent, including, without limitation, any of the foregoing referred to in Schedule6.          “Pledged Notes”: all promissory notes listed on Schedule 2, all IntercompanyNotes at any time issued to any Grantor and all other promissory notes issued to or held by anyGrantor (other than promissory notes issued in connection with extensions of trade credit by anyGrantor in the ordinary course of business).          “Pledged Stock”: the shares of Capital Stock listed on Schedule 2, togetherwith any other shares, stock certificates, options, interests or rights of any nature whatsoever inrespect of the Capital Stock of any Person that may be issued or granted to, or held by, anyGrantor while this Agreement is in effect; provided that in no event shall more than 66% ofthe total outstanding Foreign Subsidiary Voting Stock of any Foreign Subsidiary be required to bepledged (or be pledged) hereunder.          “Proceeds”: all “proceeds” as such term is defined in Section 9-102(a)(64) of the NewYork UCC and, in any event, shall include, without limitation, all dividends or other income fromthe Investment Property, collections thereon or distributions or payments with respect thereto.          “Receivable”: any right to payment for goods sold or leased or for services rendered,whether or not such right is evidenced by an Instrument or Chattel Paper and whether or not it hasbeen earned by performance (including, without limitation, any Account).          “Secured Parties”: the collective reference to the Collateral Agent, theAdministrative Agent, the Lenders and any affiliate of any Lender to which Borrower Obligations orGuarantor Obligations, as applicable, are owed.          “Securities Act”: the Securities Act of 1933, as amended.

 

4          “Trademarks”: (i) all trademarks, trade names, corporate names, company names,business names, fictitious business names, trade styles, service marks, logos and other source orbusiness identifiers, and all goodwill associated therewith, now existing or hereafter adopted oracquired, all registrations and recordings thereof, and all applications in connection therewith,whether in the United States Patent and Trademark Office or in any similar office or agency of theUnited States, any State thereof or any other country or any political subdivision thereof, orotherwise, and all common-law rights related thereto, including, without limitation, any of theforegoing referred to in Schedule 6, and (ii) the right to obtain all renewals thereof.          “Trademark License”: any agreement, whether written or oral, providing for the grantby or to any Grantor of any right to use any Trademark, including, without limitation, any of theforegoing referred to in Schedule 6.     1.2 Other Definitional Provisions. (a) The words “hereof,” “herein”, “hereto” and“hereunder” and words of similar import when used in this Agreement shall refer to this Agreementas a whole and not to any particular provision of this Agreement, and Section and Schedulereferences are to this Agreement unless otherwise specified.     (b) The meanings given to terms defined herein shall be equally applicable to both thesingular and plural forms of such terms.     (c) Where the context requires, terms relating to the Collateral or any part thereof, whenused in relation to a Grantor, shall refer to such Grantor’s Collateral or the relevant partthereof.SECTION 2. GUARANTEE     2.1 Guarantee. (a) Each of the Guarantors hereby, jointly and severally,unconditionally and irrevocably, guarantees to the Collateral Agent, for its benefit and for thebenefit of the other Secured Parties and their respective successors and assigns, the prompt andcomplete payment and performance by the Borrower when due (whether at the stated maturity, byacceleration or otherwise) of the Borrower Obligations.     (b) Anything herein or in any other Loan Document to the contrary notwithstanding, the maximumliability of each Guarantor hereunder and under the other Loan Documents shall in no event exceedthe amount which can be guaranteed by such Guarantor under applicable federal and state lawsrelating to fraudulent transfers or conveyances or the insolvency of debtors (after giving effectto the right of contribution established in Section 2.2).     (c) Each Guarantor agrees that the Borrower Obligations may at any time and from time to timeexceed the amount of the liability of such Guarantor hereunder without impairing the guaranteecontained in this Section 2 or affecting the rights and remedies of the Collateral Agent, theAdministrative Agent or any Lender hereunder.     (d) The guarantee contained in this Section 2 shall remain in full force and effect until thisAgreement terminates pursuant to Section 8.15, notwithstanding that from time to time during theterm of the Credit Agreement the Borrower may be free from any Borrower Obligations.     (e) No payment made by the Borrower, any of the Guarantors, any other guarantor or any otherPerson or received or collected by the Collateral Agent, the Administrative Agent or any Lenderfrom the Borrower, any of the Guarantors, any other guarantor or any other Person by virtue of anyaction or proceeding or any set-off or appropriation or application at any time or from time totime in reduction

 

5of or in payment of the Borrower Obligations shall be deemed to modify, reduce,release or otherwise affect the liability of any Guarantor hereunder which shall, notwithstandingany such payment (other than any payment made by such Guarantor in respect of the BorrowerObligations or any payment received or collected from such Guarantor in respect of the BorrowerObligations), remain liable for the Borrower Obligations up to the maximum liability of suchGuarantor hereunder until this Agreement terminates pursuant to Section 8.15.     2.2 Right of Contribution. Each Guarantor hereby agrees that to the extent that aGuarantor shall have paid more than its proportionate share of any payment made hereunder, suchGuarantor shall be entitled to seek and receive contribution from and against any other Guarantorhereunder which has not paid its proportionate share of such payment. Each Guarantor’s right ofcontribution shall be subject to the terms and conditions of Section 2.3. The provisions of thisSection 2.2 shall in no respect limit the obligations and liabilities of any Guarantor to theAdministrative Agent, the Collateral Agent and the Lenders, and each Subsidiary Guarantor shallremain liable to the Administrative Agent, the Collateral Agent and the Lenders for the full amountguaranteed by such Guarantor hereunder.     2.3 No Subrogation. Notwithstanding any payment made by any Guarantor hereunder orany set-off or application of funds of any Guarantor by the Administrative Agent, the CollateralAgent or any Lender, no Guarantor shall be entitled to be subrogated to any of the rights of theAdministrative Agent, the Collateral Agent or any Lender against the Borrower or any otherGuarantor or any collateral security or guarantee or right of offset held by the AdministrativeAgent, the Collateral Agent or any Lender for the payment of the Borrower Obligations, nor shallany Guarantor seek or be entitled to seek any contribution or reimbursement from the Borrower orany other Guarantor in respect of payments made by such Guarantor hereunder, until this Agreementterminates pursuant to Section 8.15. If any amount shall be paid to any Guarantor on account ofsuch subrogation rights at any time prior to termination of this Agreement pursuant to Section8.15, such amount shall be held by such Guarantor in trust for the Administrative Agent, theCollateral Agent and the Lenders, segregated from other funds of such Guarantor, and shall,forthwith upon receipt by such Guarantor, be turned over to the Collateral Agent in the exact formreceived by such Guarantor (duly indorsed by such Guarantor to the Collateral Agent, if required),to be applied against the Borrower Obligations, whether matured or unmatured, in accordance withSection 6.5.     2.4 Amendments, etc. with respect to the Borrower Obligations. Each Guarantor shallremain obligated hereunder notwithstanding that, without any reservation of rights against anyGuarantor and without notice to or further assent by any Guarantor, any demand for payment of any of the Borrower Obligations made by the Administrative Agent, theCollateral Agent or any Lender may be rescinded by the Administrative Agent, the Collateral Agentor such Lender and any of the Borrower Obligations continued, and the Borrower Obligations, or theliability of any other Person upon or for any part thereof, or any collateral security or guaranteetherefor or right of offset with respect thereto, may, from time to time, in whole or in part, berenewed, extended, amended, modified, accelerated, compromised, waived, surrendered or released bythe Administrative Agent, the Collateral Agent or any Lender, and the Credit Agreement and theother Loan Documents and any other documents executed and delivered in connection therewith may beamended, modified, supplemented or terminated, in whole or in part, as the Administrative Agent (orthe Required Lenders or all Lenders, as the case may be) may deem advisable from time to time, andany collateral security, guarantee or right of offset at any time held by the Administrative Agent,the Collateral Agent or any Lender for the payment of the Borrower Obligations may be sold,exchanged, waived, surrendered or released. None of the Administrative Agent, the Collateral Agentor any Lender shall have any obligation to protect, secure, perfect or insure any Lien at any timeheld by it as security for the Borrower Obligations or for the guarantee contained in this Section2 or any property subject thereto.

 

6     2.5 Guarantee Absolute and Unconditional. Each Guarantor waives any and all notice ofthe creation, renewal, extension or accrual of any of the Borrower Obligations and notice of orproof of reliance by the Administrative Agent, the Collateral Agent or any Lender upon theguarantee contained in this Section 2 or acceptance of the guarantee contained in this Section 2;the Borrower Obligations, and any of them, shall conclusively be deemed to have been created,contracted or incurred, or renewed, extended, amended or waived, in reliance upon the guaranteecontained in this Section 2; and all dealings between the Borrower and any of the Guarantors, onthe one hand, and the Administrative Agent, the Collateral Agent and the Lenders, on the otherhand, likewise shall be conclusively presumed to have been had or consummated in reliance upon theguarantee contained in this Section 2. Each Guarantor waives diligence, presentment, protest,demand for payment and notice of default or nonpayment to or upon the Borrower or any of theGuarantors with respect to the Borrower Obligations. Each Guarantor understands and agrees thatthe guarantee of such Guarantor contained in this Section 2 shall be construed as a continuing,absolute and unconditional guarantee of payment without regard to (a) the validity orenforceability of the Credit Agreement or any other Loan Document, any of the Borrower Obligationsor any other collateral security therefor or guarantee or right of offset with respect thereto atany time or from time to time held by the Administrative Agent, the Collateral Agent or any Lender,(b) any defense, set-off or counterclaim (other than a defense of payment or performance) which mayat any time be available to or be asserted by the Borrower or any other Person against theAdministrative Agent, the Collateral Agent or any Lender, or (c) any other circumstance whatsoever(with or without notice to or knowledge of the Borrower or such Guarantor) which constitutes, ormight be construed to constitute, an equitable or legal discharge of the Borrower for the BorrowerObligations, or of such Guarantor under the guarantee of such Guarantor contained in this Section2, in bankruptcy or in any other instance. When making any demand hereunder or otherwise pursuingits rights and remedies hereunder against any Guarantor, the Administrative Agent, the CollateralAgent or any Lender may, but shall be under no obligation to, make a similar demand on or otherwisepursue such rights and remedies as it may have against the Borrower, any other Guarantor or anyother Person or against any collateral security or guarantee for the Borrower Obligations or anyright of offset with respect thereto, and any failure by the Administrative Agent, the CollateralAgent or any Lender to make any such demand, to pursue such other rights or remedies or to collectany payments from the Borrower, any other Guarantor or any other Person or to realize upon any suchcollateral security or guarantee or to exercise any such right of offset, or any release of theBorrower, any other Guarantor or any other Person or any such collateral security, guarantee orright of offset, shall not relieve any Guarantor of any obligation or liability hereunder, andshall not impair or affect the rights and remedies, whether express, implied or available as amatter of law, of the Administrative Agent, the Collateral Agent or any Lender against any Guarantor. For the purposes hereof “demand” shall include thecommencement and continuance of any legal proceedings.     2.6 Reinstatement. The guarantee contained in this Section 2 shall continue to beeffective, or be reinstated, as the case may be, if at any time payment, or any part thereof, ofany of the Borrower Obligations is rescinded or must otherwise be restored or returned by theAdministrative Agent, the Collateral Agent or any Lender upon the insolvency, bankruptcy,dissolution, liquidation or reorganization of the Borrower or any Guarantor, or upon or as a resultof the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for,the Borrower or any Guarantor or any substantial part of its property, or otherwise, all as thoughsuch payments had not been made.     2.7 Payments. Each Guarantor hereby guarantees that payments hereunder will be paidto the Administrative Agent without set-off or counterclaim in Dollars at the Funding Office asspecified in the Credit Agreement.SECTION 3. GRANT OF SECURITY INTEREST

 

7           Each Grantor hereby assigns and transfers to the Collateral Agent, and hereby grants to theCollateral Agent, for its benefit and for the benefit of the other Secured Parties, a securityinterest in all of the following property now owned or at any time hereafter acquired by suchGrantor or in which such Grantor now has or at any time in the future may acquire any right, titleor interest (collectively, the “Collateral”), as collateral security for the prompt andcomplete payment and performance when due (whether at the stated maturity, by acceleration orotherwise) of such Grantor’s Obligations:     (a) all Accounts;     (b) all Chattel Paper;     (c) all Contracts;     (d) all Deposit Accounts;     (e) all Documents (other than title documents with respect to Vehicles);     (f) all Equipment;     (g) all Fixtures;     (h) all General Intangibles;     (i) all Instruments;     (j) all Intellectual Property;     (k) all Inventory;     (l) all Investment Property;     (m) all Letter-of-Credit Rights;     (n) all other property not otherwise described above (except for any property specificallyexcluded from any clause in this section above, and any property specifically excluded from anydefined term used in any clause of this section above);     (o) all books and records pertaining to the Collateral; and     (p) to the extent not otherwise included, all Proceeds, Supporting Obligations and products ofany and all of the foregoing and all collateral security and guarantees given by any Person withrespect to any of the foregoing;provided, however, that notwithstanding any of the other provisions set forth in thisSection 3, this Agreement shall not constitute a grant of a security interest in (i) any propertyto the extent that such grant of a security interest is prohibited by any Requirements of Law of aGovernmental Authority, requires a consent not obtained of any Governmental Authority pursuant tosuch Requirement of Law or is prohibited by, or constitutes a breach or default under or results inthe termination of or requires any consent not obtained under, any contract, license, agreement,instrument or other document evidencing or giving rise to such property or, in the case of anyInvestment Property, Pledged Stock or Pledged Note, any applicable shareholder or similaragreement, except to the extent that such Requirement of Law or the term in such contract, license,agreement, instrument or other document or shareholder or similar

 

8agreement providing for such prohibition, breach, default or termination or requiring such consent is ineffective underapplicable law, (ii) Deposit Accounts exclusively used for payroll, payroll taxes and otheremployee wage and benefit payments to or for the benefit of any of Grantor’s employees or (iii) the“Collateral” as defined in the Collateral Account Agreement.SECTION 4. REPRESENTATIONS AND WARRANTIES          To induce the Administrative Agent, the Collateral Agent and the Lenders to enter into theCredit Agreement and to induce the Lenders to make their respective extensions of credit to theBorrower thereunder, each Grantor hereby represents and warrants to the Administrative Agent, theCollateral Agent and each Lender that:     4.1 Title; No Other Liens. Except for the security interest granted to theAdministrative Agent for the ratable benefit of the Secured Parties pursuant to this Agreement andthe other Liens permitted to exist on the Collateral by the Credit Agreement, such Grantor ownseach item of the Collateral free and clear of any and all Liens or claims of others. No financingstatement or other public notice with respect to all or any part of the Collateral is on file or ofrecord in any public office, except such as have been filed in favor of the Collateral Agent, forits benefit and for the benefit of the other Secured Parties, pursuant to this Agreement or as arepermitted by the Credit Agreement. For the avoidance of doubt, it is understood and agreed thatany Grantor may, as part of its business, grant licenses to third parties to use IntellectualProperty owned or developed by a Grantor. For purposes of this Agreement and the other LoanDocuments, such licensing activity shall not constitute a “Lien” on such Intellectual Property.Each of the Administrative Agent, the Collateral Agent and each Lender understands that any suchlicenses may be exclusive to the applicable licensees, and such exclusivity provisions may limitthe ability of the Collateral Agent to utilize, sell, lease or transfer the related IntellectualProperty or otherwise realize value from such Intellectual Property pursuant hereto.     4.2 Perfected First Priority Liens. The security interests granted pursuant to this Agreement (a) upon completion of thefilings and other actions specified on Schedule 3 (which, in the case of all filings and otherdocuments referred to on said Schedule, have been delivered to the Administrative Agent incompleted and duly executed form) will constitute valid perfected security interests in all of theCollateral in favor of the Collateral Agent, for its benefit and for the benefit of the otherSecured Parties, as collateral security for such Grantor’s Obligations, enforceable in accordancewith the terms hereof against all creditors of such Grantor and any Persons purporting to purchaseany Collateral from such Grantor and (b) are prior to all other Liens on the Collateral inexistence on the date hereof except for Liens permitted by the Credit Agreement; providedthat no representations are made herein with respect to the requirements of any laws of anyjurisdiction other than the United States or any State thereof.     4.3 Jurisdiction of Organization; Chief Executive Office. On the date hereof, suchGrantor’s jurisdiction of organization, identification number from the jurisdiction of organization(if any), and the location of such Grantor’s chief executive office or sole place of business orprincipal residence, as the case may be, are specified on Schedule 4. Such Grantor has furnishedto the Administrative Agent a certified charter, certificate of incorporation or other organizationdocument and long-form good standing certificate as of a date which is recent to the date hereof.     4.4 RESERVED.     4.5 Farm Products. None of the Collateral constitutes, or is the Proceeds of, FarmProducts.     4.6 Investment Property. (a) The shares of Pledged Stock pledged by such Grantorhereunder constitute all the issued and outstanding shares of all classes of the Capital Stock ofeach Issuer

 

9owned by such Grantor or, in the case of Foreign Subsidiary Voting Stock, if less, 66%of the outstanding Foreign Subsidiary Voting Stock of each relevant Issuer;     (b) All the shares of the Pledged Stock have been duly and validly issued and are fully paidand nonassessable;     (c) Each of the Pledged Notes constitutes the legal, valid and binding obligation of theobligor with respect thereto, enforceable in accordance with its terms, subject to the effects ofbankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar lawsrelating to or affecting creditors’ rights generally, general equitable principles (whetherconsidered in a proceeding in equity or at law) and an implied covenant of good faith and fairdealing;     (d) Such Grantor is the record and beneficial owner of, and has good title to, the InvestmentProperty pledged by it hereunder, free of any and all Liens or options in favor of, or claims of,any other Person, except the security interest created by this Agreement and Liens permitted by theCredit Agreement; provided that no representations are made herein with respect to therequirements of any laws of any jurisdiction other than the United States or any State thereof.     4.7 Receivables. (a) No amount payable to such Grantor under or in connection with any Receivable isevidenced by any Instrument or Chattel Paper which has not been delivered to the Collateral Agentto the extent required by Section 5.1.     (b) None of the obligors on any Receivables is a Governmental Authority.     (c) The amounts represented by such Grantor to the Lenders from time to time as owing to suchGrantor in respect of the Receivables will at such times be accurate (in all material respects).     4.8 Intellectual Property. (a) Schedule 5 lists all Intellectual Propertyowned by such Grantor in its own name on the date hereof.     (b) On the date hereof, all material Intellectual Property is valid, subsisting, unexpired andenforceable, has not been abandoned and does not infringe the intellectual property rights of anyother Person in any material respect.     (c) Except as set forth in Schedule 5, on the date hereof, none of such IntellectualProperty is the subject of any licensing or franchise agreement pursuant to which such Grantor isthe licensor or franchisor.     (d) No holding, decision or judgment has been rendered by any Governmental Authority whichwould limit, cancel or question the validity of, or such Grantor’s rights in, any such IntellectualProperty in any respect that could reasonably be expected to have a Material Adverse Effect.     (e) No action or proceeding is pending, or, to the knowledge of such Grantor, threatened, onthe date hereof (i) seeking to limit, cancel or question the validity of any Intellectual Propertyor such Grantor’s ownership interest therein, or (ii) which, if adversely determined, would have amaterial adverse effect on the value of any Intellectual Property.     4.9 Commercial Tort Claims     (a) On the date hereof no Grantor has rights in any Commercial Tort Claim with potential valuein excess of $500,000.

 

10     (b) Upon the filing of a financing statement covering any Commercial Tort Claim referred to inSection 5.10 hereof against such Grantor in the jurisdiction specified in Schedule 3 hereto, thesecurity interest granted in such Commercial Tort Claim will constitute a valid perfected securityinterest in favor of the Collateral Agent, for its benefit and for the benefit of the other SecuredParties, as collateral security for such Grantor’s Obligations, enforceable in accordance with theterms hereof against all creditors of such Grantor and any Persons purporting to purchase suchCollateral from Grantor, which security interest shall be prior to all other Liens on suchCollateral except for Liens permitted by the Credit Agreement.SECTION 5. COVENANTS          Each Grantor covenants and agrees with the Administrative Agent, the Collateral Agent and theLenders that, from and after the date of this Agreement until this Agreement terminates inaccordance with Section 8.15:     5.1 Delivery of Instruments, Certificated Securities and Chattel Paper. If any amountpayable under or in connection with any of the Collateral shall be or become evidenced by anyInstrument, Certificated Security or Chattel Paper, such Instrument, Certificated Security orChattel Paper shall be immediately delivered to the Collateral Agent, duly indorsed in a mannersatisfactory to the Administrative Agent, to be held as Collateral pursuant to this Agreement;provided, that the Grantors shall not be obligated to deliver to the Collateral Agent anyInstruments or Chattel Paper held by any Grantor at any time to the extent that (a) the aggregateface amount of all such Instruments and Chattel Paper held by all Grantors at such time does notexceed $5,000,000, and (b) the face amount of any individual Instrument or Chattel Paper held bysuch Grantor at such time does not exceed $1,000,000.     5.2 Maintenance of Insurance. (a) Such Grantor will maintain or cause to bemaintained, with financially sound and reputable companies, insurance as required by Section 5.5 ofthe Credit Agreement.     (b) All such insurance shall (i) provide for at least 30 days’ notice to the AdministrativeAgent of termination, lapse or cancellation and (ii) name the Collateral Agent as insured party orloss payee.     5.3 RESERVED.     5.4 Maintenance of Perfected Security Interest; Further Documentation. (a) SuchGrantor shall maintain the security interest created by this Agreement as a perfected securityinterest having at least the priority described in Section 4.2 and shall defend such securityinterest against the claims and demands of all Persons whomsoever, subject to the rights of suchGrantor under the Loan Documents to dispose of the Collateral.     (b) Such Grantor will furnish to the Administrative Agent, the Collateral Agent and theLenders from time to time statements and schedules further identifying and describing the assetsand property of such Grantor and such other reports in connection therewith as the AdministrativeAgent or the Collateral Agent may reasonably request, all in reasonable detail.     (c) At any time and from time to time, upon the written request of the Administrative Agent orthe Collateral Agent, and at the sole expense of such Grantor, such Grantor will promptly and dulyexecute and deliver, and have recorded, such further instruments and documents and take suchfurther actions as the Administrative Agent or the Collateral Agent may reasonably request for thepurpose of obtaining or preserving the full benefits of this Agreement and of the rights and powersherein granted,

 

11including, without limitation, (i) filing any financing or continuation statementsunder the Uniform Commercial Code (or other similar laws) in effect in any jurisdiction in theUnited States with respect to the security interests created hereby and (ii) in the case ofInvestment Property, Deposit Accounts, and Letter-of-Credit Rights (to the extent not constitutingSupporting Obligations), taking any actions necessary to enable the Collateral Agent to obtain“control” (within the meaning of the applicable Uniform Commercial Code) with respect thereto.     5.5 Changes in Name, etc. Such Grantor will not, except upon 15 days’ prior written notice to the AdministrativeAgent and the Collateral Agent and delivery to the Administrative Agent and the Collateral Agent ofall additional executed financing statements and other documents reasonably requested by theAdministrative Agent to maintain the validity, perfection and priority of the security interestsprovided for herein, (i) change its jurisdiction of organization from that referred to in Section4.3 or (ii) change its name.     5.6 RESERVED.     5.7 Investment Property. (a) If such Grantor shall become entitled to receive orshall receive any certificate (including, without limitation, any certificate representing adividend or a distribution in connection with any reclassification, increase or reduction ofcapital or any certificate issued in connection with any reorganization), option or rights inrespect of the Capital Stock of any Issuer, whether in addition to, in substitution of, as aconversion of, or in exchange for, any shares of the Pledged Stock, or otherwise in respectthereof, such Grantor shall accept the same as the agent of the Collateral Agent, theAdministrative Agent and the Lenders, hold the same in trust for the Collateral Agent, theAdministrative Agent and the Lenders and deliver the same forthwith to the Collateral Agent in theexact form received, duly indorsed by such Grantor to the Collateral Agent, if required, togetherwith an undated stock power covering such certificate duly executed in blank by such Grantor andwith, if the Administrative Agent so requests, signature guaranteed, to be held by the CollateralAgent, subject to the terms hereof, as additional collateral security for the Obligations. Anysums paid upon or in respect of the Investment Property that constitutes Collateral upon theliquidation or dissolution of any Issuer shall be paid over to the Collateral Agent to be held byit hereunder as additional collateral security for the Obligations, and in case any distribution ofcapital shall be made on or in respect of such Investment Property or any property shall bedistributed upon or with respect to such Investment Property pursuant to the recapitalization orreclassification of the capital of any Issuer or pursuant to the reorganization thereof, theproperty so distributed shall, unless otherwise subject to a perfected security interest in favorof the Collateral Agent, be delivered to the Collateral Agent to be held by it hereunder asadditional collateral security for the Obligations. If any sums of money or property so paid ordistributed in respect of the Investment Property that constitutes Collateral shall be received bysuch Grantor, such Grantor shall, until such money or property is paid or delivered to theCollateral Agent, hold such money or property in trust for the Collateral Agent, the AdministrativeAgent and the Lenders, segregated from other funds of such Grantor, as additional collateralsecurity for the Obligations.     (b) Such Grantor will not (i) vote to enable, or take any other action to permit, any Issuerto issue any Capital Stock of any nature or to issue any other securities convertible into orgranting the right to purchase or exchange for any Capital Stock of any nature of any Issuer,unless such securities are delivered to the Collateral Agent, concurrently with the issuancethereof, to be held by the Collateral Agent as Collateral, or (ii) without the prior writtenconsent of the Administrative Agent (x) sell, assign,

 

12transfer, exchange, or otherwise dispose of, or grant any option with respect to, the Investment Property or Proceeds thereof (except pursuantto a transaction expressly permitted by the Credit Agreement), (y) create, incur or permit to existany Lien or option in favor of, or any claim of any Person with respect to, any of the InvestmentProperty or Proceeds thereof, or any interest therein, except for the security interests created bythis Agreement or Liens permitted by the Credit Agreement or (z) enter into anyagreement or undertaking restricting the right or ability of such Grantor or the CollateralAgent to sell, assign or transfer any of the Investment Property or Proceeds thereof.     (c) In the case of each Grantor which is an Issuer, such Issuer agrees that (i) it will bebound by the terms of this Agreement relating to the Investment Property issued by it and willcomply with such terms insofar as such terms are applicable to it, (ii) it will notify theAdministrative Agent and the Collateral Agent promptly in writing of the occurrence of any of theevents described in Section 5.7(a) with respect to the Investment Property issued by it and (iii)the terms of Sections 6.3(c) and 6.7 shall apply to it, mutatismutandis, withrespect to all actions that may be required of it pursuant to Section 6.3(c) or 6.7 with respect tothe Investment Property issued by it.     5.8 Receivables. Other than in the ordinary course of business consistent with itspast practice or prudent industry practice used in industries that are the same as or similar tothose which such Grantor is engaged or which individually or in the aggregate are not material tosuch Grantor, such Grantor will not (i) grant any extension of the time of payment of anyReceivable, (ii) compromise or settle any Receivable for less than the full amount thereof, (iii)release, wholly or partially, any Person liable for the payment of any Receivable, (iv) allow anycredit or discount whatsoever on any Receivable or (v) amend, supplement or modify any Receivablein any manner that could adversely affect the value thereof.     5.9 Intellectual Property. (a) Such Grantor (either itself or through licensees)will (i) continue to use each Trademark necessary for the conduct of its business as currentlyconducted on each and every trademark class of goods applicable to its current line as reflected inits current catalogs, brochures and price lists in order to maintain such Trademark in full forcefree from any claim of abandonment for non-use, (ii) maintain as in the past substantially the samequality of products and services offered under such Trademark, and (iii) use such Trademark withthe appropriate notice of registration and all other notices and legends required by applicableRequirements of Law.     (b) Such Grantor will not do any act, or omit to do any act, whereby any Patent necessary forthe conduct of its business as currently conducted may become forfeited, abandoned or dedicated tothe public.     (c) Such Grantor (i) will employ each Copyright necessary for the conduct of its business ascurrently conducted and (ii) will not do any act or knowingly omit to do any act whereby anymaterial portion of such Copyrights may become invalidated or otherwise impaired. Such Grantorwill not do any act whereby any material portion of such Copyrights may fall into the publicdomain.     (d) Such Grantor will not do any act that knowingly uses any material Intellectual Propertynecessary for the conduct of its business as currently conducted to infringe the intellectualproperty rights of any other Person.     (e) Such Grantor will notify the Administrative Agent, the Collateral Agent and the Lendersimmediately if it knows, or has reason to know, that any application or registration relating toany Intellectual Property necessary for the conduct of its business as currently conducted maybecome forfeited, abandoned or dedicated to the public, or of any adverse determination ordevelopment (including, without limitation, the institution of, or any such determination ordevelopment in, any

 

13proceeding in the United States Patent and Trademark Office, the United StatesCopyright Office) regarding such Grantor’s ownership of, or the validity of, any such Intellectual Property orsuch Grantor’s right to register the same or to own and maintain the same.     (f) Whenever such Grantor, either by itself or through any agent, employee, licensee ordesignee, shall file an application for the registration of any Intellectual Property necessary forthe conduct of its business as currently conducted with the United States Patent and TrademarkOffice, the United States Copyright Office, such Grantor shall report such filing to theAdministrative Agent within five Business Days after the last day of the fiscal quarter in whichsuch filing occurs. Upon request of the Administrative Agent, such Grantor shall execute anddeliver, and have recorded, any and all agreements, instruments, documents, and papers as theAdministrative Agent or the Collateral Agent may request to evidence the Collateral Agent’s and theLenders’ security interest in any Copyright, Patent or Trademark necessary for the conduct of itsbusiness as currently conducted and the goodwill and general intangibles of such Grantor relatingthereto or represented thereby.     (g) Such Grantor will take all reasonable and necessary steps, including, without limitation,in any proceeding before the United States Patent and Trademark Office, the United States CopyrightOffice, to maintain and pursue each application relating to any Intellectual Property necessary forthe conduct of its business (and to obtain the relevant registration) and to maintain eachregistration of such material Intellectual Property, including, without limitation, filing ofapplications for renewal, affidavits of use and affidavits of incontestability.     (h) In the event that any Intellectual Property necessary for the conduct of its business ascurrently conducted is infringed, misappropriated or diluted by a third party, such Grantor shall(i) take such actions as such Grantor shall reasonably deem appropriate under the circumstances toprotect such Intellectual Property and (ii) if such Intellectual Property is of material economicvalue, promptly notify the Administrative Agent after it learns thereof and take such actions assuch Grantor shall reasonably deem appropriate, including filing suit for infringement,misappropriation or dilution, to seek injunctive relief where appropriate and to recover any andall damages for such infringement, misappropriation or dilution.     5.10 Commercial Tort Claims. If such Grantor shall obtain an interest in anyCommercial Tort Claim which it reasonably deems to have a potential value in excess of $500,000,such Grantor shall within 30 days of obtaining such interest sign and deliver documentationacceptable to the Administrative Agent and the Collateral Agent granting a security interest underthe terms and provisions of this Agreement in and to such Commercial Tort Claim.     5.11 Foreign Assets. Notwithstanding anything herein to the contrary, with respect toany personal property of a Grantor constituting Collateral which is located in or pertaining to ajurisdiction other than the United States or any State thereof, as to which the security interestgranted hereunder may not be perfected by (a) filing financing statements under the UniformCommercial Code, or (b) possession or “control” (as defined in Section 8-106 or Article 9 of theUCC) thereof in the United States, such Grantor will not be required to take any action necessaryto perfect such security interest under the laws of the jurisdiction in which such property islocated or to which such property pertains.SECTION 6. REMEDIAL PROVISIONS     6.1 Certain Matters Relating to Receivables. (a) The Administrative Agent shall have the right, at any time after the occurrence andduring the continuance of an Event of Default, to make test verifications of the Receivables in anymanner and through any medium that it reasonably considers advisable, and each Grantor shallfurnish all such assistance and information as the Administrative Agent

 

14may reasonably require in connection with such test verifications. At any time and from time to time after the occurrenceand during the continuance of an Event of Default, upon the Administrative Agent’s request and atthe expense of the relevant Grantor, such Grantor shall cause independent public accountants orothers satisfactory to the Administrative Agent to furnish to the Administrative Agent reportsshowing reconciliations, aging and test verifications of, and trial balances for, the Receivables.     (b) The Administrative Agent hereby authorizes each Grantor to collect such Grantor’sReceivables, subject to the Administrative Agent’s direction and control, and the AdministrativeAgent may curtail or terminate said authority at any time after the occurrence and during thecontinuance of an Event of Default. If required by the Administrative Agent at any time after theoccurrence and during the continuance of an Event of Default, any payments of Receivables, whencollected by any Grantor, (i) shall be forthwith (and, in any event, within two Business Days)deposited by such Grantor in the exact form received, duly indorsed by such Grantor to theCollateral Agent if required, in a Collateral Account maintained under the sole dominion andcontrol of the Collateral Agent, subject to withdrawal by the Collateral Agent for the account ofthe Secured Parties only as provided in Section 6.5, and (ii) until so turned over, shall be heldby such Grantor in trust for the Collateral Agent, the Administrative Agent and the Lenders,segregated from other funds of such Grantor. Each such deposit of Proceeds of Receivables shall beaccompanied by a report identifying in reasonable detail the nature and source of the paymentsincluded in the deposit.     6.2 Communications with Obligors; Grantors Remain Liable. (a) If an Event of Defaultshall occur and is continuing, the Administrative Agent in its own name or in the name of othersmay communicate with obligors under the Receivables to verify with them to the AdministrativeAgent’s satisfaction the existence, amount and terms of any Receivables.     (b) Upon the request of the Administrative Agent at any time after the occurrence and duringthe continuance of an Event of Default, each Grantor shall notify obligors on the Receivables thatthe Receivables have been assigned to the Collateral Agent for its benefit and for the benefit ofthe other Secured Parties and that payments in respect thereof shall be made directly to theCollateral Agent.     (c) Anything herein to the contrary notwithstanding, each Grantor shall remain liable undereach of the Receivables to observe and perform all the conditions and obligations to be observedand performed by it thereunder, all in accordance with the terms of any agreement giving risethereto. None of the Collateral Agent, the Administrative Agent or any Lender shall have anyobligation or liability under any Receivable (or any agreement giving rise thereto) by reason of orarising out of this Agreement or the receipt by the Collateral Agent, the Administrative Agent orany Lender of any payment relating thereto, nor shall the Collateral Agent, the AdministrativeAgent or any Lender be obligated in any manner to perform any of the obligations of any Grantorunder or pursuant to any Receivable (or any agreement giving rise thereto) or Contract, to make anypayment, to make any inquiry as to the nature or the sufficiency of any payment received by it oras to the sufficiency of any performance by any party thereunder, to present or file any claim, totake any action to enforce any performance or to collect the payment of any amounts which may havebeen assigned to it or to which it may be entitled at any time or times.     6.3 Pledged Stock. (a) Unless an Event of Default shall have occurred and be continuing and theAdministrative Agent shall have given notice to the relevant Grantor of the Administrative Agent’sintent to exercise its corresponding rights pursuant to Section 6.3(b), each Grantor shall bepermitted to receive all cash dividends paid in respect of the Pledged Stock and all payments madein respect of the Pledged Notes, in each case paid in the normal course of business of the relevantIssuer and consistent with past practice, to the extent permitted in the Credit Agreement, and toexercise all voting and corporate or other organizational rights with respect to the InvestmentProperty; provided, however,

 

15that no vote shall be cast or corporate or other organizational rightexercised or other action taken which would be inconsistent with or result in any violation of anyprovision of the Credit Agreement, this Agreement or any other Loan Document.     (b) If an Event of Default shall occur and be continuing and the Administrative Agent shallgive notice of its intent to exercise such rights to the relevant Grantor or Grantors, (i) theCollateral Agent shall have the right to receive any and all cash dividends, payments or otherProceeds paid in respect of the Investment Property and make application thereof to the Obligationsin accordance with Section 6.5, and (ii) any or all of the Investment Property shall be registeredin the name of the Collateral Agent or its nominee, and the Collateral Agent or its nominee maythereafter exercise (x) all voting, corporate and other rights pertaining to such InvestmentProperty at any meeting of shareholders of the relevant Issuer or Issuers or otherwise and (y) anyand all rights of conversion, exchange and subscription and any other rights, privileges or optionspertaining to such Investment Property as if it were the absolute owner thereof (including, withoutlimitation, the right to exchange at its discretion any and all of the Investment Property upon themerger, consolidation, reorganization, recapitalization or other fundamental change in thecorporate or other organizational structure of any Issuer, or upon the exercise by any Grantor orthe Collateral Agent of any right, privilege or option pertaining to such Investment Property, andin connection therewith, the right to deposit and deliver any and all of the Investment Propertywith any committee, depositary, transfer agent, registrar or other designated agency upon suchterms and conditions as the Administrative Agent may determine), all without liability except toaccount for property actually received by it, but neither the Collateral Agent nor theAdministrative Agent shall have any duty to any Grantor to exercise any such right, privilege oroption and shall not be responsible for any failure to do so or delay in so doing.     (c) Each Grantor hereby authorizes and instructs each Issuer of any Investment Propertypledged by such Grantor or the Administrative Agent hereunder to (i) comply with any instructionreceived by it from the Collateral Agent in writing that (x) states that an Event of Default hasoccurred and is continuing and (y) is otherwise in accordance with the terms of this Agreement,without any other or further instructions from such Grantor, and each Grantor agrees that eachIssuer shall be fully protected in so complying, and (ii) unless otherwise expressly permittedhereby, pay any dividends or other payments with respect to the Investment Property directly to theCollateral Agent.     6.4 Proceeds to be Turned Over To Collateral Agent. In addition to the rights of theAdministrative Agent, the Collateral Agent and the Lenders specified in Section 6.1 with respect topayments of Receivables, if an Event of Default shall occur and be continuing, all Proceedsreceived by any Grantor consisting of cash, checks and Instruments shall be held by such Grantor intrust for the Collateral Agent, the Administrative Agent and the Lenders, segregated from otherfunds of such Grantor, and shall, forthwith upon receipt by such Grantor, be turned over to theCollateral Agent in the exact form received by such Grantor (duly indorsed by such Grantor to theCollateral Agent, if required). All Proceeds received by the Collateral Agent hereunder shall beheld by the Collateral Agent in a Collateral Account maintained under its sole dominion andcontrol. All Proceeds while held in trust for the Secured Parties by the Collateral Agent in aCollateral Account (or by such Grantor in trust for the Collateral Agent, the Administrative Agentand the Lenders) shall continue to be held as collateral security for all the Obligations and shall not constitute paymentthereof until applied as provided in Section 6.5.     6.5 Application of Proceeds. At such intervals as may be agreed upon by the Borrowerand the Administrative Agent, or, if an Event of Default shall have occurred and be continuing, atany time at the Administrative Agent’s election, the Collateral Agent may apply all or any part ofProceeds constituting Collateral, whether or not held in any Collateral Account, and any proceedsof the guarantee set forth in Section 2, in payment of the Obligations in the following order:

 

16          First, to pay incurred and unpaid fees and expenses of the Administrative Agentand the Collateral Agent under the Loan Documents, including, without limitation, fees andexpenses of counsel to the Administrative Agent and the Collateral Agent;          Second, to the Administrative Agent, for application by it towards payment ofamounts then due and owing and remaining unpaid in respect of the Obligations, prorata among the Secured Parties according to the amounts of the Obligations then dueand owing and remaining unpaid to the Secured Parties;          Third, to the Administrative Agent, for application by it towards prepayment ofthe Obligations, prorata among the Secured Parties according to the amountsof the Obligations then held by the Secured Parties; and          Fourth, any balance remaining after the Obligations shall have been paid infull and the Commitments shall have terminated shall be paid over to the Borrower or towhomsoever may be lawfully entitled to receive the same.     6.6 Code and Other Remedies. If an Event of Default shall occur and be continuing,the Collateral Agent, on behalf of itself, the Collateral Agent, the Administrative Agent and theLenders, may exercise, in addition to all other rights and remedies granted to them in thisAgreement and in any other instrument or agreement securing, evidencing or relating to theObligations, all rights and remedies of a secured party under the New York UCC or any otherapplicable law. Without limiting the generality of the foregoing, the Collateral Agent, withoutdemand of performance or other demand, presentment, protest, advertisement or notice of any kind(except notice pursuant to 6.3(b) and any notice required by law referred to below) to or upon anyGrantor or any other Person (all and each of which demands, defenses, advertisements and noticesare hereby waived), may in such circumstances forthwith collect, receive, appropriate and realizeupon the Collateral, or any part thereof, and/or may forthwith sell, lease, assign, give option oroptions to purchase, or otherwise dispose of and deliver the Collateral or any part thereof (orcontract to do any of the foregoing), in one or more parcels at public or private sale or sales, atany exchange, broker’s board or office of the Collateral Agent, the Administrative Agent or anyLender or elsewhere upon such terms and conditions as it may deem advisable and at such prices asit may deem best, for cash or on credit or for future delivery without assumption of any creditrisk. The Collateral Agent, the Administrative Agent or any Lender shall have the right upon anysuch public sale or sales, and, to the extent permitted by law, upon any such private sale orsales, to purchase the whole or any part of the Collateral so sold, free of any right or equity ofredemption in any Grantor, which right or equity is hereby waived and released. Each Grantorfurther agrees, at the Collateral Agent’s request, to assemble the Collateral and make it availableto the Collateral Agent at places which the Collateral Agent shall reasonably select, whether atsuch Grantor’s premises or elsewhere. The Collateral Agent shall apply the net proceeds of anyaction taken by it pursuant to Section 6.5 with respect to any Grantor’s Collateral, after deducting allreasonable costs and expenses of every kind incurred in connection therewith or incidental to thecare or safekeeping of any of the Collateral of such Grantor or in any way relating to theCollateral of such Grantor or the rights of the Collateral Agent, the Administrative Agent and theLenders hereunder, including, without limitation, reasonable attorneys’ fees and disbursements, tothe payment in whole or in part of the Obligations, and only after such application and after thepayment by the Collateral Agent of any other amount required by any provision of law, including,without limitation, Section 9-615(a)(3) of the New York UCC, need the Collateral Agent account forthe surplus, if any, to any Grantor. To the extent permitted by applicable law, each Grantorwaives all claims, damages and demands it may acquire against the Collateral Agent, theAdministrative Agent or any Lender arising out of the exercise by them of any rights hereunder, tothe extent such exercise does not constitute gross negligence or willful misconduct. If any noticeof a proposed sale or other disposition of Collateral shall

 

17be required by law, such notice shall be deemed reasonable and proper if given at least 10 days before such sale or other disposition.     6.7 Registration Rights. (a) If the Collateral Agent and the Administrative Agentshall determine to exercise the Collateral Agent’s right to sell any or all of the Pledged Stockpursuant to Section 6.6, and if in the opinion of the Collateral Agent or the Administrative Agentit is necessary or advisable to have the Pledged Stock, or that portion thereof to be sold,registered under the provisions of the Securities Act, the relevant Grantor will cause the Issuerthereof to (i) execute and deliver, and cause the directors and officers of such Issuer to executeand deliver, all such instruments and documents, and do or cause to be done all such other acts asmay be, in the opinion of the Collateral Agent or the Administrative Agent, necessary or advisableto register the Pledged Stock, or that portion thereof to be sold, under the provisions of theSecurities Act, (ii) use its best efforts to cause the registration statement relating thereto tobecome effective and to remain effective for a period of one year from the date of the first publicoffering of the Pledged Stock, or that portion thereof to be sold, and (iii) make all amendmentsthereto and/or to the related prospectus which, in the opinion of the Collateral Agent or theAdministrative Agent, are necessary or advisable, all in conformity with the requirements of theSecurities Act and the rules and regulations of the Securities and Exchange Commission applicablethereto. Each Grantor agrees to cause such Issuer to comply with the provisions of the securitiesor “Blue Sky” laws of any and all jurisdictions which the Collateral Agent or the Administrativeshall designate and to make available to its security holders, as soon as practicable, an earningsstatement (which need not be audited) which will satisfy the provisions of Section 11(a) of theSecurities Act.     (b) Each Grantor recognizes that the Collateral Agent may be unable to effect a public sale ofany or all the Pledged Stock, by reason of certain prohibitions contained in the Securities Act andapplicable state securities laws or otherwise, and may be compelled to resort to one or moreprivate sales thereof to a restricted group of purchasers which will be obliged to agree, amongother things, to acquire such securities for their own account for investment and not with a viewto the distribution or resale thereof. Each Grantor acknowledges and agrees that any such privatesale may result in prices and other terms less favorable than if such sale were a public sale and,notwithstanding such circumstances, agrees that any such private sale shall be deemed to have beenmade in a commercially reasonable manner. Neither the Collateral Agent nor the AdministrativeAgent shall be under any obligation to delay a sale of any of the Pledged Stock for the period oftime necessary to permit the Issuer thereof to register such securities for public sale under theSecurities Act, or under applicable state securities laws, even if such Issuer would agree to doso.     (c) Each Grantor agrees to use its best efforts to do or cause to be done all such other actsas may be necessary to make such sale or sales of all or any portion of the Pledged Stock pursuantto this Section 6.7 valid and binding and in compliance with any and all other applicableRequirements of Law.Each Grantor further agrees that a breach of any of the covenants contained in this Section6.7 will cause irreparable injury to the Collateral Agent, the Administrative Agent and theLenders, that the Collateral Agent, the Administrative Agent and the Lenders have no adequateremedy at law in respect of such breach and, as a consequence, that each and every covenantcontained in this Section 6.7 shall be specifically enforceable against such Grantor, and suchGrantor hereby waives and agrees not to assert any defenses against an action for specificperformance of such covenants except for a defense that no Event of Default has occurred under theCredit Agreement.     6.8 Subordination. Each Grantor hereby agrees that, upon the occurrence and duringthe continuance of an Event of Default, unless otherwise agreed by the Administrative Agent, allIndebtedness owing by it to any Subsidiary of the Borrower shall be fully subordinated to theindefeasible payment in full in cash of such Grantor’s Obligations.
 

 

18     6.9 Deficiency. Each Grantor shall remain liable for any deficiency if theproceeds of any sale or other disposition of the Collateral are insufficient to pay its Obligationsand the fees and disbursements of any attorneys employed by the Administrative Agent, theCollateral Agent or any Lender to collect such deficiency.SECTION 7. THE COLLATERAL AGENT     7.1 Collateral Agent’s Appointment as Attorney-in-Fact, etc. (a) Each Grantor herebyirrevocably constitutes and appoints the Collateral Agent and any officer or agent thereof, withfull power of substitution, as its true and lawful attorney-in-fact with full irrevocable power andauthority in the place and stead of such Grantor and in the name of such Grantor or in its ownname, for the purpose of carrying out the terms of this Agreement, to take any and all appropriateaction and to execute any and all documents and instruments which may be necessary or desirable toaccomplish the purposes of this Agreement, and, without limiting the generality of the foregoing,each Grantor hereby gives the Collateral Agent the power and right, on behalf of such Grantor,without notice to or assent by such Grantor, to do any or all of the following:     (i) in the name of such Grantor or its own name, or otherwise, take possession of andindorse and collect any checks, drafts, notes, acceptances or other instruments for the paymentof moneys due under any Receivable or with respect to any other Collateral and file any claim ortake any other action or proceeding in any court of law or equity or otherwise deemedappropriate by the Administrative Agent or the Collateral Agent for the purpose of collectingany and all such moneys due under any Receivable or with respect to any other Collateralwhenever payable;     (ii) in the case of any material Intellectual Property, execute and deliver, and haverecorded, any and all agreements, instruments, documents and papers as the Administrative Agentmay request to evidence the Collateral Agent’s, the Administrative Agent’s and the Lenders’security interest in such Intellectual Property and the goodwill and general intangibles of suchGrantor relating thereto or represented thereby;     (iii) pay or discharge taxes and Liens levied or placed on or threatened against theCollateral, effect any repairs or any insurance called for by the terms of this Agreement andpay all or any part of the premiums therefor and the costs thereof;     (iv) execute, in connection with any sale provided for in Section 6.6 or 6.7, anyindorsements, assignments or other instruments of conveyance or transfer with respect to theCollateral; and     (v) (1) direct any party liable for any payment under any of the Collateral to makepayment of any and all moneys due or to become due thereunder directly to the Collateral Agentor as the Administrative Agent or the Collateral Agent shall direct; (2) ask or demand for,collect, and receive payment of and receipt for, any and all moneys, claims and other amountsdue or to become due at any time in respect of or arising out of any Collateral; (3) sign andindorse any invoices, freight or express bills, bills of lading, storage or warehouse receipts,drafts against debtors, assignments, verifications, notices and other documents in connectionwith any of the Collateral; (4) commence and prosecute any suits, actions or proceedings at lawor in equity in any court of competent jurisdiction to collect the Collateral or any portionthereof and to enforce any other right in respect of any Collateral; (5) defend any suit, actionor proceeding brought against such Grantor with respect to any Collateral; (6) settle,compromise or adjust any such suit, action or proceeding and, inconnection therewith, give such discharges or releases as the Administrative Agent or theCollateral Agent may deem appropriate; (7) assign any Copyright, Patent or Trademark (along withthe goodwill of the business to which any such Copyright, Patent or Trademark pertains),throughout the world for

 

19such term or terms, on such conditions, and in such manner, as theAdministrative Agent or the Collateral Agent shall in its sole discretion determine; and (8)generally, sell, transfer, pledge and make any agreement with respect to or otherwise deal withany of the Collateral as fully and completely as though the Collateral Agent were the absoluteowner thereof for all purposes, and do, at the Administrative Agent’s option and such Grantor’sexpense, at any time, or from time to time, all acts and things which the Administrative Agentand/or the Collateral Agent deems necessary to protect, preserve or realize upon the Collateraland the Collateral Agent’s, the Administrative Agent’s and the Lenders’ security intereststherein and to effect the intent of this Agreement, all as fully and effectively as such Grantormight do.     Anything in this Section 7.1(a) to the contrary notwithstanding, each of the Collateral Agentand the Administrative Agent agrees that it will not exercise any rights under the power ofattorney provided for in this Section 7.1(a) unless an Event of Default shall have occurred and becontinuing.     (b) If any Grantor fails to perform or comply with any of its agreements contained herein,each of the Collateral Agent and the Administrative Agent, at its option, but without anyobligation so to do, may perform or comply, or otherwise cause performance or compliance, with suchagreement.     (c) The expenses of the Administrative Agent and the Collateral Agent incurred in connectionwith actions undertaken as provided in this Section 7.1, together with interest thereon at a rateper annum equal to the highest rate per annum at which interest would then be payable on anycategory of past due ABR Loans under the Credit Agreement, from the date of payment by theCollateral Agent and the Administrative Agent, as the case may be, to the date reimbursed by therelevant Grantor, shall be payable by such Grantor to the Collateral Agent and the AdministrativeAgent, as the case may be, on demand.     (d) Each Grantor hereby ratifies all that said attorneys shall lawfully do or cause to be doneby virtue hereof. All powers, authorizations and agencies contained in this Agreement are coupledwith an interest and are irrevocable until this Agreement is terminated and the security interestscreated hereby are released.     7.2 Duty of Collateral Agent. The Collateral Agent’s sole duty with respect to thecustody, safekeeping and physical preservation of the Collateral in its possession, under Section9-207 of the New York UCC or otherwise, shall be to deal with it in the same manner as theCollateral Agent deals with similar property for its own account. Neither the Collateral Agent,the Administrative Agent, any Lender nor any of their respective officers, directors, employees oragents shall be liable for failure to demand, collect or realize upon any of the Collateral or forany delay in doing so or shall be under any obligation to sell or otherwise dispose of anyCollateral upon the request of any Grantor or any other Person or to take any other actionwhatsoever with regard to the Collateral or any part thereof. The powers conferred on theCollateral Agent, the Administrative Agent and the Lenders hereunder are solely to protect theCollateral Agent’s, the Administrative Agent’s and the Lenders’ interests in the Collateral andshall not impose any duty upon the Collateral Agent or any Lender to exercise any such powers. TheCollateral Agent, the Administrative Agent and the Lenders shall be accountable only for amountsthat they actually receive as a result of the exercise of such powers, and neither they nor any oftheir officers, directors, employees or agents shall be responsible to any Grantor for any act orfailure to act hereunder, except for their own gross negligence or willful misconduct.     7.3 Execution of Financing Statements. Pursuant to any applicable law, each Grantorauthorizes the Administrative Agent to file or record financing statements and other filing orrecording documents or instruments with respect to the Collateral without the signature of suchGrantor in such form and in such offices as the Administrative Agent determines appropriate toperfect the security

 

20interests of the Collateral Agent and the Administrative Agent under thisAgreement. Each Grantor authorizes the Collateral Agent to use the collateral description “allpersonal property” in any such financing statements. Each Grantor hereby ratifies and authorizesthe filing by the Administrative Agent of any financing statement with respect to the Collateralmade prior to the date hereof.     7.4 Authority of Collateral Agent. Each Grantor acknowledges that the rights andresponsibilities of the Collateral Agent under this Agreement with respect to any action taken bythe Collateral Agent or the exercise or non-exercise by the Collateral Agent of any option, votingright, request, judgment or other right or remedy provided for herein or resulting or arising outof this Agreement shall, as between the Collateral Agent, the Administrative Agent and the Lenders,be governed by the Credit Agreement and by such other agreements with respect thereto as may existfrom time to time among them, but, as between the Collateral Agent and the Grantors, the CollateralAgent shall be conclusively presumed to be acting as agent for the Secured Parties with full andvalid authority so to act or refrain from acting, and no Grantor shall be under any obligation, orentitlement, to make any inquiry respecting such authority.SECTION 8. MISCELLANEOUS     8.1 Amendments in Writing. None of the terms or provisions of this Agreement may bewaived, amended, supplemented or otherwise modified except in accordance with Section 9.1 of theCredit Agreement.     8.2 Notices. All notices, requests and demands to or upon the Collateral Agent or anyGrantor hereunder shall be effected in the manner provided for in Section 9.2 of the CreditAgreement; provided that any such notice, request or demand to or upon any Guarantor shall beaddressed to such Guarantor at its notice address set forth on Schedule 1.     8.3 No Waiver by Course of Conduct; Cumulative Remedies. None of the CollateralAgent, the Administrative Agent or any Lender shall by any act (except by a written instrumentpursuant to Section 8.1), delay, indulgence, omission or otherwise be deemed to have waived anyright or remedy hereunder or to have acquiesced in any Default or Event of Default. No failure toexercise, nor any delay in exercising, on the part of the Collateral Agent, the AdministrativeAgent or any Lender, any right, power or privilege hereunder shall operate as a waiver thereof. Nosingle or partial exercise of any right, power or privilege hereunder shall preclude any other orfurther exercise thereof or the exercise of any other right, power or privilege. A waiver by theCollateral Agent, the Administrative Agent or any Lender of any right or remedy hereunder on anyone occasion shall not be construed as a bar to any right or remedy which the Collateral Agent, theAdministrative Agent or such Lender would otherwise have on any future occasion. The rights andremedies herein provided are cumulative, may be exercised singly or concurrently and are notexclusive of any other rights or remedies provided by law.     8.4 Enforcement Expenses; Indemnification. (a) Each Guarantor agrees to pay orreimburse each Lender, the Administrative Agent and the Collateral Agent for all its costs andexpenses incurred in collecting against such Guarantor under the guarantee contained in Section 2or otherwise enforcing or preserving any rights under this Agreement and the other Loan Documentsto which such Guarantor is a party, including, without limitation, the fees and disbursements ofcounsel (including the allocated fees and expenses of in-house counsel) to each Lender and ofcounsel to the Administrative Agent and the Collateral Agent.     (b) Each Guarantor agrees to pay, and to save the Collateral Agent, the Administrative Agentand the Lenders harmless from, any and all liabilities with respect to, or resulting from any delayin paying, any and all stamp, excise, sales or other taxes which may be payable or determined to be payable

 

21with respect to any of the Collateral or in connection with any of the transactionscontemplated by this Agreement.     (c) Each Guarantor agrees to pay, and to save the Collateral Agent, the Administrative Agentand the Lenders harmless from, any and all liabilities, obligations, losses, damages, penalties,actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever withrespect to the execution, delivery, enforcement, performance and administration of this Agreementto the extent the Borrower would be required to do so pursuant to Section 9.5 of the CreditAgreement.     (d) The agreements in this Section 8.4 shall survive repayment of the Obligations and allother amounts payable under the Credit Agreement and the other Loan Documents.     8.5 Successors and Assigns. This Agreement shall be binding upon the successors andassigns of each Grantor and shall inure to the benefit of the Collateral Agent, the AdministrativeAgent and the Lenders and their successors and assigns; provided that no Grantor may assign,transfer or delegate any of its rights or obligations under this Agreement without the priorwritten consent of the Administrative Agent.     8.6 Set-Off. In addition to any rights and remedies of the Secured Parties providedby law, each Lender shall have the right at any time and from time to time while an Event ofDefault shall have occurred and be continuing, without notice to any Grantor, any such notice beingexpressly waived by each Grantor to the extent permitted by applicable law, upon any Obligationsbecoming due and payable by any Grantor (whether at the stated maturity, by acceleration orotherwise), to apply to the payment of such Obligations, by setoff or otherwise, any and alldeposits (general or special, time or demand, provisional or final), in any currency, and any othercredits, indebtedness or claims, in any currency, in each case whether direct or indirect, absoluteor contingent, matured or unmatured, at any time held or owing by such Secured Parties, to or forthe credit or the account of such Grantor. Each Secured Party agrees promptly to notify therelevant Grantor and the Administrative Agent after any such application made by such SecuredParty, provided that the failure to give such notice shall not affect the validity of suchapplication.     8.7 Counterparts. This Agreement may be executed by one or more of the parties tothis Agreement on any number of separate counterparts (including by telecopy), and all of saidcounterparts taken together shall be deemed to constitute one and the same instrument.     8.8 Severability. Any provision of this Agreement which is prohibited orunenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent ofsuch prohibition or unenforceability without invalidating the remaining provisions hereof, and anysuch prohibition or unenforceability in any jurisdiction shall not invalidate or renderunenforceable such provision in any other jurisdiction.     8.9 Section Headings. The Section headings used in this Agreement are for convenienceof reference only and are not to affect the construction hereof or be taken into consideration inthe interpretation hereof.     8.10 Integration. This Agreement and the other Loan Documents represent the agreementof the Grantors, the Collateral Agent, the Administrative Agent and the Lenders with respect to thesubject matter hereof and thereof, and there are no promises, undertakings, representations orwarranties by the Collateral Agent, the Administrative Agent or any Lender relative to subjectmatter hereof and thereof not expressly set forth or referred to herein or in the other LoanDocuments.

 

22     **8.11****GOVERNING LAW****. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED ANDINTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.**     8.12 Submission To Jurisdiction; Waivers. Each Grantor hereby irrevocably andunconditionally:     (a) submits for itself and its property in any legal action or proceeding relating to thisAgreement and the other Loan Documents to which it is a party, or for recognition and enforcementof any judgment in respect thereof, to the non-exclusive general jurisdiction of the courts of theState of New York, the courts of the United States of America for the Southern District of NewYork, and appellate courts from any thereof;     (b) consents that any such action or proceeding may be brought in such courts and waives anyobjection that it may now or hereafter have to the venue of any such action or proceeding in anysuch court or that such action or proceeding was brought in an inconvenient court and agrees not toplead or claim the same;     (c) agrees that service of process in any such action or proceeding may be effected by mailinga copy thereof by registered or certified mail (or any substantially similar form of mail), postageprepaid, to such Grantor at its address referred to in Section 8.2 or at such other address ofwhich the Administrative Agent shall have been notified pursuant thereto;     (d) agrees that nothing herein shall affect the right to effect service of process in anyother manner permitted by law or shall limit the right to sue in any other jurisdiction; and     (e) waives, to the maximum extent not prohibited by law, any right it may have to claim orrecover in any legal action or proceeding referred to in this Section any special, exemplary,punitive or consequential damages.     8.13 Acknowledgements. Each Grantor hereby acknowledges that:     (a) it has been advised by counsel in the negotiation, execution and delivery of thisAgreement and the other Loan Documents to which it is a party;     (b) none of the Collateral Agent, the Administrative Agent or any Lender has any fiduciaryrelationship with or duty to any Grantor arising out of or in connection with this Agreement or anyof the other Loan Documents, and the relationship between the Grantors, on the one hand, and theCollateral Agent, the Administrative Agent and Lenders, on the other hand, in connection herewithor therewith is solely that of debtor and creditor; and     (c) no joint venture is created hereby or by the other Loan Documents or otherwise exists byvirtue of the transactions contemplated hereby among the Lenders or among the Grantors and theLenders.     8.14 Additional Grantors. Each Subsidiary of the Borrower that is required to becomea party to this Agreement pursuant to Section 5.9 of the Credit Agreement shall become a Grantorfor all purposes of this Agreement upon execution and delivery by such Subsidiary of an AssumptionAgreement in the form of Annex 1 hereto.

 

23     8.15 Releases. (a) At such time as the Loans and the other Obligations shall havebeen paid in full and the Commitments have been terminated, the Collateral shall be released fromthe Liens created hereby, and this Agreement and all obligations (other than those expressly statedto survive such termination) of the Collateral Agent, the Administrative Agent and each Grantorhereunder shall terminate, all without delivery of any instrument or performance of any act by anyparty, and all rights to the Collateral shall revert to the Grantors. At the request and soleexpense of any Grantor following any such termination, the Collateral Agent shall deliver to suchGrantor any Collateral held by the Collateral Agent hereunder, and execute and deliver to suchGrantor such documents as such Grantor shall reasonably request to evidence such termination.     (b) If any of the Collateral shall be sold, transferred or otherwise disposed of by anyGrantor in a transaction permitted by the Credit Agreement, then the Collateral Agent, at therequest and sole expense of such Grantor (and the request of the Administrative Agent), shallexecute and deliver to such Grantor all releases or other documents reasonably necessary ordesirable for the release of the Liens created hereby on such Collateral. At the request and soleexpense of the Borrower, a Subsidiary Guarantor shall be released from its obligations hereunder inthe event that all the Capital Stock of such Subsidiary Guarantor shall be sold, transferred orotherwise disposed of in a transaction permitted by the Credit Agreement.     **8.16****WAIVER OF JURY TRIAL**.          **EACH GRANTOR HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGALACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIMTHEREIN.**     8.17 Authority Subject to Credit Agreement. (a) Wilmington Trust Company has beenappointed the Collateral Agent hereunder pursuant to Section 8 of the Credit Agreement. It isexpressly understood and agreed by the parties to this Agreement that any authority conferred uponthe Collateral Agent hereunder is subject to the terms of the delegation of authority made by theSecured Parties (other than the Collateral Agent) to the Collateral Agent pursuant to the CreditAgreement and that the Collateral Agent has agreed to act (and any successor Collateral Agent shallact) as such hereunder only on the express conditions contained in the Credit Agreement (including,without limitation, Section 8.2 thereof). Any successor Collateral Agent appointed in accordancewith Section 8.2 of the Credit Agreement shall be entitled to all the rights, interests andbenefits of the Collateral Agent hereunder.     (b) In the event of a conflict between this Agreement and the Credit Agreement, the CreditAgreement will govern and control.     8.18 Intercreditor Agreement Governs. Notwithstanding any other provision containedherein, this Agreement, the Liens created hereby and the rights, remedies, duties and obligationsprovided for herein are subject in all respects to the provisions of the Intercreditor Agreement.In the event of any conflict or inconsistency between the provisions of this Agreement and theIntercreditor Agreement, the provisions of the Intercreditor Agreement shall govern and control forall purposes.

 

      IN WITNESS WHEREOF, each of the undersigned has caused this Guarantee and Collateral Agreementto be duly executed and delivered as of the date first above written.      SUPERIOR OFFSHORE INTERNATIONAL, L.L.C.