EXECUTION COPY

# PLEDGE AND SECURITY
AGREEMENT

# Dated as of June 30,
2003

# among

# ALARIS MEDICAL
SYSTEMS, INC.as a Grantor

# and

# Each Other Grantor From Time to Time
Party Hereto

# and

# CITICORP NORTH
AMERICA, INC. as Administrative Agent

WEIL, GOTSHAL &
MANGES LLP 767 FIFTH AVENUE NEW YORK, NEW YORK
10153-0119

---

PLEDGE
AND SECURITY AGREEMENT,dated as of June 30, 2003, by ALARIS MEDICAL SYSTEMS,
INC. (the Borrower) and each of the other entities listed on the
signature pages hereof or that becomes a party hereto pursuant to Section 7.10
(Additional Grantors) (each a Grantor and, collectively, the
Grantors), in favor of CITICORP NORTH AMERICA, INC.
(Citicorp), as agent for the Secured Parties (as defined in the Credit
Agreement referred to below) (in such capacity, the Administrative
Agent).

W I T N E S S E T H:

WHEREAS,
pursuant to the Credit Agreement, dated as of June 30, 2003 (as the same may be amended,
restated, supplemented or otherwise modified from time to time, the Credit
Agreement), among the Borrower, the Lenders and the Issuers party thereto and
Citicorp, as agent for the Lenders and the Issuers, UBS SECURITIES LLC, as syndication
agent for the Lenders and the Issuers (in such capacity, the Syndication
Agent), and BEAR STEARNS CORPORATE LENDING INC. and CIBC WORLD MARKETS CORP., as
co-documentation agents for the Lenders and the Issuers (in such capacity, each a
Co-Documentation Agent and collectively, the Co-Documentation
Agents), the Lenders and the Issuers have severally agreed to make extensions of
credit to the Borrower upon the terms and subject to the conditions set forth therein;

WHEREAS,
the Grantors other than the Borrower are party to the Guaranty pursuant to which they have
guaranteed the Obligations; and

WHEREAS,
it is a condition precedent to the obligation of the Lenders and the Issuers to make their
respective extensions of credit to the Borrower under the Credit Agreement that the
Grantors shall have executed and delivered this Agreement to the Administrative Agent;

NOW,
THEREFORE, in consideration of the premises and to induce the Lenders, the Issuers and the
Administrative Agent to enter into the Credit Agreement and to induce the Lenders and the
Issuers to make their respective extensions of credit to the Borrower thereunder, each
Grantor hereby agrees with the Administrative Agent as follows:

# ARTICLE I     DEFINED TERMS

Section 1.1
Definitions

(a)    
          Unless otherwise defined herein, terms defined in the Credit Agreement and used
          herein have the meanings given to them in the Credit Agreement.

(b)    
          Terms used herein without definition that are defined in the UCC have the
          meanings given to them in the UCC, including the following terms (which are
          capitalized herein):

| | Account
Debtor AccountsCertificated Security
Chattel Paper Commercial Tort Claim
Commodity Account Deposit Account 
Documents Entitlement Holder Entitlement
Order Equipment Financial Asset 
General Intangibles Instruments 
InventoryInvestment Property 
Letter-of-Credit RightProceeds 
Securities Account Securities Intermediary 
Security Security Entitlement
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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

Additional
Pledged Collateral means any Pledged Collateral acquired by any Grantor after
the date hereof and on which a security interest is granted pursuant to
Section 2.2 (Grant of Security Interest in Collateral), including, to the
extent a security interest is granted thereon pursuant to Section 2.2 (Grant of
Security Interest in Collateral), (i) all Stock and Stock Equivalents of any
Person that are acquired by any Grantor after the date hereof, together with all
certificates, instruments or other documents representing any of the foregoing and all
Security Entitlements of any Grantor in respect of any of the foregoing, (ii) all
additional indebtedness from time to time owed to any Grantor by any obligor on the
Pledged Debt Instruments and the instruments evidencing such indebtedness and
(iii) all interest, cash, instruments and other property or Proceeds from time to
time received, receivable or otherwise distributed in respect of or in exchange for any of
the foregoing. Additional Pledged Collateral may be General Intangibles
or Investment Property.

Agreement
means this Pledge and Security Agreement.

Australian
Copyrights means, with reference to each Grantor, all Copyrights of such Grantor
which are used in Australia, or the subject of a filing, registration or application in IP
Australia; provided, however that any Copyrights deemed by the Stamp Duties Act of
1923 (South Australia) to have a nexus with the State of South Australia shall not
constitute Australian Copyrights for purposes of this Agreement.

Australian
Designs means, with reference to each Grantor, all designs of such Grantor which
are used in Australia, or the subject of a filing, registration or application in IP
Australia; provided, however, that any design deemed by the Stamp Duties Act of
1923 (South Australia) to have a nexus with the State of South Australia shall not
constitute an Australian Design for purposes of this Agreement.

Australian
Intellectual Property means, collectively, all rights, priorities and privileges
of any Grantor relating to intellectual property, whether arising under United States,
Australia , multinational or foreign laws or otherwise, including Australian Designs,
Copyrights, Copyright Licenses, Patents, Patent Licenses, Trademarks, Trademark Licenses,
trade secrets and Internet domain names, and all rights to sue at law or in equity for any
infringement or other impairment thereof, including the right to receive all proceeds and
damages therefrom, which are used in Australia, or the subject of a filing, registration
or application in IP Australia; provided, however that any intellectual property
deemed by the Stamp Duties Act of 1923 (South Australia) to have a nexus with the State of
South Australia shall not constitute Australian Intellectual Property for purposes of this
Agreement.

Australian
Patents means, with reference to each Grantor, all Patents of such Grantor which
are used in Australia, or the subject of a filing, registration or application in IP
Australia; provided, however that any Patent deemed by the Stamp Duties Act of 1923
(South Australia) to have a nexus with the State of South Australia shall not constitute
an Australian Patent for purposes of this Agreement.

Australian
Trademarks means, with reference to each Grantor, all Trademarks of such Grantor
which are used in Australia, or the subject of a filing, registration or application in IP
Australia; provided, however that any Trademarks deemed by the Stamp Duties Act of
1923 (South Australia) to have a nexus with the State of South Australia shall not
constitute Australian Trademarks.

Canadian
Collateralmeans Canadian Intellectual Property and Canadian Pledged Stock.

Canadian Copyrights
means, with reference to each Grantor, all Copyrights of such Grantor which are used in
Canada, or the subject of a filing, registration or application in the Canadian
Intellectual Property Office.

Canadian
Intellectual Property means, collectively, all rights, priorities and privileges
of any Grantor relating to intellectual property, whether arising under United States,
Canadian, multinational or foreign laws or otherwise, including Copyrights, Copyright
Licenses, Patents, Patent Licenses, Trademarks, Trademark Licenses, trade secrets and
Internet domain names, and all rights to sue at law or in equity for any infringement or
other impairment thereof, including the right to receive all proceeds and damages
therefrom, which are used in Canada, or the subject of a filing, registration or
application in the Canadian Intellectual Property Office.

Canadian
Patents means, with reference to each Grantor, all Patents of such Grantor which
are used in Canada, or the subject of a filing, registration or application in the
Canadian Intellectual Property Office.

Canadian
Pledged Stock means all Pledged Certificated Stock and all Pledged
Uncertificated Stock of the Canadian Subsidiary.

Canadian
Subsidiary means ALARIS Medical Canada Ltd., a corporation organized under the
laws of New Brunswick, Canada and a Wholly-Owned Subsidiary of the Borrower.

Canadian
Trademarks means, with reference to each Grantor, all Trademarks of such Grantor
which are used in Canada, or the subject of a filing, registration or application in the
Canadian Intellectual Property Office.

Collateral
has the meaning specified in Section 2.1 (Collateral).

Concentration
Account means any Deposit Account maintained by any Loan Party that is (a) a
concentration account or (b) that maintains, during any calendar month, an average
aggregate overnight available balance in excess of the Dollar Equivalent of $1,000,000.
For the avoidance of doubt, Qualified Permitted Liens Accounts shall not be deemed to be
Concentration Accounts for purposes of this Agreement.

Control
Account Agreement means a letter agreement, substantially in the form of
Annex 2 (Form of Control Account Agreement) or in such other form as
may be required by the applicable Securities Intermediary (provided that each Control
Account Agreement shall be in form and substance reasonably satisfactory to the
Administrative Agent), executed by the relevant Grantor, the Administrative Agent and the
relevant Approved Securities Intermediary and sufficient to perfect the Administrative
Agents security interest in such Securities Account by control within
the meanings of Section 8-106 and 9-106 of the UCC.

Copyright
Licenses means any written agreement naming any Grantor as licensor or licensee
granting any right under any Copyright, including the grant of any right to copy, publicly
perform, create derivative works, manufacture, distribute, exploit or sell materials
derived from any Copyright.

Copyrights
Security Agreement means an agreement, substantially in the form of Annex 5
(Form of Copyright Security Agreement)with such changes as may be agreed to by the
Administrative Agent, executed by the relevant Grantor and the Administrative Agent.

Copyrights
means (a) all copyrights arising under the laws of the United States, any other
country or any political subdivision thereof, whether registered or unregistered and
whether published or unpublished, all registrations and recordings thereof and all
applications in connection therewith, including all registrations, recordings and
applications in the United States Copyright Office or in any foreign counterparts thereof,
and (b) the right to obtain all renewals thereof.

Deposit
Account Bank means a financial institution selected or approved by the
Administrative Agent and with respect to which a Grantor has delivered to the
Administrative Agent an executed Deposit Account Control Agreement.

Deposit
Account Control Agreement means a letter agreement, substantially in the form of
Annex 1 (Form of Deposit Account Control Agreement) or in such other form as
may be required by the applicable Deposit Account Bank (provided that each Deposit Account
Control Agreement shall be in form and substance reasonably satisfactory to the
Administrative Agent), executed by the relevant Grantor, the Administrative Agent and the
relevant financial institution and sufficient to perfect the Administrative Agents
security interest in such Deposit Account by control within the meaning of
Section 9-104 of the UCC.

Excluded
Disposables Increment means, with respect to Instrument Contracts, the amount
included in the price of disposables for payment of equipment, interest, repair and, if
applicable, site license fees and certain other consulting and/or implementation services,
or any thereof, which amount is invoiced by a Grantor to a customer and upon payment
thereof by the customer is required to be remitted by the Grantor to a third-party
financing party.

Excluded
Equity means any Voting Stock of any direct Subsidiary of a Grantor which
Subsidiary is a controlled foreign corporation (a CFC), in excess of 65% (but
only to the extent of such excess) of the total outstanding Voting Stock of such
Subsidiary. In the event that the Grantor is a CFC, then Excluded Equity shall include any
stock or other interest of any direct or indirect Subsidiary held by such Grantor. If the
Grantor is not a CFC, then Excluded Equity shall include the outstanding Voting Stock of
any direct Subsidiary of such Grantor (other than a direct Subsidiary which is a CFC) only
if the direct Subsidiary (a) is not a corporation for United States federal income tax
purposes and (b) owns Voting Stock in a CFC, but only to the extent a pledge of such
direct Subsidiarys Voting Stock would result, for purposes of Section 956 of the
Code, in a pledge in excess of 65% of the Voting Stock of such CFC. Notwithstanding the
foregoing, Excluded Equity may be pledged if (i) the Borrower and Administrative Agent
otherwise agree or (ii) such pledge can be made without resulting in any material adverse
tax consequence for the Loan Parties and their Subsidiaries, taken as a whole.

Excluded
Property means, collectively, (i) Excluded Equity, (ii) any permit, lease,
license, contract, instrument or other agreement held by any Grantor that prohibits or
requires the consent of any Person other than the Borrower and its Affiliates as a
condition to the creation by such Grantor of a Lien thereon, or any permit, lease, license
contract or other agreement held by any Grantor to the extent that any Requirement of Law
applicable thereto prohibits the creation of a Lien thereon, but only, in each case, to
the extent, and for so long as, such prohibition is not terminated or rendered
unenforceable or otherwise deemed ineffective by the UCC or any other Requirement of Law,
(iii) Equipment owned by any Grantor that is subject to a purchase money Lien or a Capital
Lease if the contract or other agreement in which such Lien is granted (or in the
documentation providing for such Capital Lease) prohibits or requires the consent of any
Person other than the Borrower and its Affiliates as a condition to the creation of any
other Lien on such Equipment; provided, however, Excluded
Property shall not include any Proceeds, substitutions or replacements of
Excluded Property referred to in the foregoing clauses (i), (ii), or (iii) of this
definition (unless such Proceeds, substitutions or replacements would constitute Excluded
Property), (iv) Qualified Hedging Obligations Collateral, (v) Qualified Hedging Contract
Accounts, (vi) Qualified Customary Permitted Liens Accounts, (vii) Excluded Disposables
Increments and (viii) any Intellectual Property deemed by the Stamp Duties Act 1923 (South
Australia) to have a nexus with the State of South Australia.

Intellectual
Property means, collectively, all rights, priorities and privileges of any
Grantor relating to intellectual property, whether arising under United States,
multinational or foreign laws or otherwise, including Copyrights, Copyright Licenses,
Patents, Patent Licenses, Trademarks, Trademark Licenses, trade secrets and Internet
domain names, and all rights to sue at law or in equity for any infringement or other
impairment thereof, including the right to receive all proceeds and damages therefrom.

Intellectual
Property Security Agreement means each Copyright Security Agreement, Patent
Security Agreement and Trademarks Security Agreement.

Intercompany
Note means any promissory note evidencing loans made by any Grantor to any of
its Subsidiaries or another Grantor.

LLC
means each limited liability company in which a Grantor has an interest, including those
set forth on Schedule 2 (Pledged Collateral).

LLC
Agreement means each operating agreement with respect to an LLC, as each
agreement has heretofore been, and may hereafter be, amended, restated, supplemented or
otherwise modified from time to time.

Material
Intellectual Property means Intellectual Property owned by or licensed to a
Grantor and material to any Grantors business.

Partnership
means each partnership in which a Grantor has an interest, including those set forth on
Schedule 2 (Pledged Collateral).

Partnership
Agreement means each partnership agreement governing a Partnership, as each such
agreement has heretofore been, and may hereafter be, amended, restated, supplemented or
otherwise modified.

Patents
means (a) all letters patent of the United States, any other country or any political
subdivision thereof and all reissues and extensions thereof, (b) all applications for
letters patent of the United States or any other country and all divisions, continuations
and continuations-in-part thereof and (c) all rights to obtain any reissues or
extensions of the foregoing.

Patent
License means all agreements, whether written or oral, providing for the grant
by or to any Grantor of any right to manufacture, have manufactured, use, import, sell or
offer for sale any invention covered in whole or in part by a Patent.

Patent
Security Agreementmeans an agreement, substantially in the form of Annex 6
(Form of Patent Security Agreement)with such changes as may be agreed to by the
Administrative Agent, executed by the relevant Grantor and the Administrative Agent.

Pledged
Certificated Stock means all Certificated Securities and any other Stock and
Stock Equivalent of a Person evidenced by a certificate, Instrument or other equivalent
document, in each case owned by any Grantor, including all Stock listed on
Schedule 2 (Pledged Collateral).

Pledged
Collateral means, collectively, the Pledged Stock, Pledged Debt Instruments, any
other Investment Property of any Grantor, chattel paper, all certificates or other
instruments representing any of the foregoing and all Security Entitlements of any Grantor
in respect of any of the foregoing. Pledged Collateral may be General Intangibles or
Investment Property.

Pledged
Debt Instruments means all right, title and interest of any Grantor in
Instruments evidencing any Indebtedness owed to such Grantor, including all Indebtedness
described on Schedule 2 (Pledged Collateral), issued by the obligors named
therein.

Pledged
Stock means all Pledged Certificated Stock and all Pledged Uncertificated Stock.
Pledged Stock shall not include the Stock of any Person (i) that is not a Domestic
Subsidiary, (ii) that is organized under the laws of Australia, Mexico and the United
Kingdom and (iii) the Stock of which shall be pledged pursuant to a Foreign Pledge
Agreement. For purposes of this Agreement, the term Pledged Stock shall
not include any Excluded Equity.

Pledged
Uncertificated Stock means any Stock or Stock Equivalent of any Person that is
not a Pledged Certificated Stock, including all right, title and interest of any Grantor
as a limited or general partner in any Partnership or as a member of any LLC and all
right, title and interest of any Grantor in, to and under any Partnership Agreement or LLC
Agreement to which it is a party.

Qualified
Hedging Contract Accounts means any deposit account, securities account or other
account established and maintained by any Grantor with any bank, securities intermediary
or other Person for the purpose of holding Qualified Hedging Obligations Collateral;
providedthat such Qualified Hedging Contract is permitted to be incurred under
Section 8.17 (No Speculative Transactions) of the Credit Agreement and the Lien on
such Qualified Hedging Obligations Collateral is permitted under Section 8.2 (Liens,
Etc.) of the Credit Agreement.

Qualified
Customary Permitted Liens Accounts means any deposit account, securities account
or other account established and maintained by any Grantor with any bank, securities
intermediary or other Person for the purpose of holding Collateral to secure Customary
Permitted Liens that are permitted under Section 8.2 (Liens, Etc.)of the Credit
Agreement; provided, that the secured party with respect to such Customary
Permitted Lien has required the applicable Grantor to provide collateral security to such
secured party.

Qualified
Hedging Obligations Collateral means any cash or cash equivalents pledged, or in
respect of which a Lien is granted by the Borrower or any of its Subsidiaries to a Person
that is not a Lender or an Affiliate of any Lender at the time such Lien is granted, to
secure any Qualified Hedging Obligation.

Qualified
Hedging Obligations means the obligations of the Borrower or any Subsidiary of
the Borrower under Qualified Hedging Contracts that are not secured by the Collateral
Documents.

Securities
Act means the Securities Act of 1933, as amended.

Trademark
License means any agreement, whether written or oral, providing for the grant by
or to any Grantor of any right to use any Trademark.

Trademarks
Security Agreement means an agreement, substantially in the form of Annex 7
(Form of Trademark Security Agreement)with such changes as may be agreed to by the
Administrative Agent, executed by the relevant Grantor and the Administrative Agent.

Trademarks
means (a) all trademarks, trade names, corporate names, company names, business
names, fictitious business names, trade styles, service marks, logos and other source or
business identifiers, and, in each case, all goodwill associated therewith, whether now
existing or hereafter adopted or acquired, all registrations and recordings thereof and
all applications in connection therewith, in each case whether in the United States Patent
and Trademark Office or in any similar office or agency of the United States, any State
thereof or any other country or any political subdivision thereof, or otherwise, and all
common-law rights related thereto, and (b) the right to obtain all renewals thereof.

UCC
means the Uniform Commercial Code as from time to time in effect in the State of New York;
provided, however, that, in the event that, by reason of mandatory
provisions of law, any of the attachment, perfection or priority of the Administrative
Agents and the Secured Parties security interest in any Collateral is governed
by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New
York, the term UCC shall mean the Uniform Commercial Code as in effect
in such other jurisdiction for purposes of the provisions hereof relating to such
attachment, perfection or priority and for purposes of definitions related to such
provisions.

Vehicles
means all vehicles covered by a certificate of title law of any state.

Section 1.2 Certain
Other Terms

(a)    
          In this Agreement, in the computation of periods of time from a specified date
          to a later specified date, the word from means from and
          including and the words to and until
          each mean to but excluding and the word through
          means to and including.

(b)    
          The terms herein, hereof,
          hereto and hereunder and similar terms
          refer to this Agreement as a whole and not to any particular Article, Section,
          subsection or clause in this Agreement.

(c)    
          References herein to an Annex, Schedule, Article, Section, subsection or clause
          refer to the appropriate Annex or Schedule to, or Article, Section, subsection
          or clause in this Agreement.

(d)    
          The meanings given to terms defined herein shall be equally applicable to both
          the singular and plural forms of such terms.

(e)    
          Where the context requires, provisions relating to any Collateral, when used in
          relation to a Grantor, shall refer to such Grantors Collateral or any
          relevant part thereof.

(f)    
          Any reference in this Agreement to a Loan Document shall include all appendices,
          exhibits and schedules thereto, and, unless specifically stated otherwise all
          amendments, restatements, supplements or other modifications thereto, and as the
          same may be in effect at any time such reference becomes operative.

(g)    
          The term including means including without
          limitation except when used in the computation of time periods.

(h)    
          The terms Lender, Issuer,
          Administrative Agent and Secured Party
          include their respective successors.

(i)    
          References in this Agreement to any statute shall be to such statute as amended
          or modified and in effect from time to time.

# ARTICLE II  GRANT OF
SECURITY INTEREST

Section 2.1
Collateral

For
the purposes of this Agreement, all of the following property now owned or at any time
hereafter acquired by a Grantor or in which a Grantor now has or at any time in the future
may acquire any right, title or interests (other than in each case, any Excluded Property)
is collectively referred to as the Collateral:

(a)    
          all Accounts;

(b)    
          all Chattel Paper;

(c)    
          all Deposit Accounts;

(d)    
          all Documents;

(e)    
          all Equipment;

(f)    
          all General Intangibles (including, without limitation, the Australian
          Intellectual Property and the Canadian Intellectual Property);

(g)    
          all Instruments;

(h)    
          all Inventory;

(i)    
          all Investment Property;

(j)    
          all Letter-of-Credit Rights;

(k)    
          all Vehicles;

(l)    
          the Commercial Tort Claims described on Schedule 7 (Commercial Tort
          Claims) and on any supplement thereto received by the Administrative Agent
          pursuant to Section 4.11 (Notice of Commercial Tort Claims);

(m)    
          all books and records pertaining to the other property described in this
          Section 2.1;

(n)    
          all other goods and personal property of such Grantor, whether tangible or
          intangible and wherever located;

(o)    
          all property of any Grantor held by the Administrative Agent or any other
          Secured Party, including all property of every description, in the possession or
          custody of or in transit to the Administrative Agent or such Secured Party for
          any purpose, including safekeeping, collection or pledge, for the account of
          such Grantor or as to which such Grantor may have any right or power; and

(p)    
          to the extent not otherwise included, all Proceeds.

Section 2.2 Grant of
Security Interest in Collateral

Each
Grantor, as collateral security for the full, prompt and complete payment and performance
when due (whether at stated maturity, by acceleration or otherwise) of the Secured
Obligations of such Grantor, hereby: (a) conveys, mortgages, pledges and hypothecates to
the Administrative Agent for the benefit of the Secured Parties, and grants to the
Administrative Agent for the benefit of the Secured Parties a lien on and security
interest in, all of its right, title and interest in, to and under the Collateral (other
than the Canadian Trademarks) of such Grantor, and (b) grants a security interest to the
Administrative Agent for the benefit of the Secured Parties in and to all of such
Grantors Canadian Trademarks; provided,however, that the foregoing
grants of security interests shall not include a security interest in any Excluded
Property; and provided, further, that, if and when any property shall cease
to be Excluded Property, the Administrative Agent shall have, and at all times from and
after the date hereof be deemed to have had, a security interest in such property.

Section 2.3 Cash
Collateral Accounts

The
Administrative Agent has established a Deposit Account at Citibank, N.A., designated as
Citicorp North America, Inc.  ALARIS Medical Systems Concentration
Account. Such Deposit Account shall be a Cash Collateral Account.

# ARTICLE III 
REPRESENTATIONS AND WARRANTIES

To
induce the Lenders, the Issuers and the Administrative Agent to enter into the Credit
Agreement, each Grantor hereby represents and warrants each of the following to the
Administrative Agent, the Lenders, the Issuers and the other Secured Parties:

Section 3.1 Title;
No Other Liens

Except
for the Lien granted to the Administrative Agent pursuant to this Agreement and the other
Liens permitted to exist on the Collateral under the Credit Agreement, such Grantor (a) is
the (i) record owner of the Pledged Collateral pledged by it hereunder constituting the
Stock of its Subsidiaries and (ii) beneficial owner of the Pledged Collateral pledged by
it hereunder constituting Instruments or Certificated Securities, (b) is the Entitlement
Holder of all such Pledged Collateral constituting Investment Property held in a
Securities Account and (c) has rights in or the power to transfer each other item of
Collateral in which a Lien is granted by it hereunder, free and clear of any other Lien.

Section 3.2
Perfection and Priority

(a)    
          The security interest granted pursuant to this Agreement shall constitute a
          valid and continuing perfected security interest in favor of the Administrative
          Agent in the Collateral for which perfection is governed by the UCC or filing
          with the United States Copyright Office or with the United States Patent and
          Trademark Office upon (i) the completion of the filings and other actions
          specified on Schedule 3 (Filings) (which, in the case of all filings
          and other documents referred to on such schedule, have been delivered to the
          Administrative Agent in completed and duly executed form), (ii) the
          delivery to the Administrative Agent of all Collateral consisting of Instruments
          and Certificated Securities, in each case properly endorsed for transfer to the
          Administrative Agent or in blank, (iii) the execution of Control Account
          Agreements with respect to Collateral that constitutes Securities Accounts of a
          Grantor and any Financial Assets credited to such Securities Accounts,
          (iv) the execution of Deposit Account Control Agreements with respect to
          Collateral that constitutes Financial Assets credited to such Deposit Accounts
          of a Grantor and all deposits therein and (v) all appropriate filings
          having been made with the United States Copyright Office. Such security interest
          shall be prior to all other Liens on the Collateral except for (a) Customary
          Permitted Liens and (b ) purchase money security interests that are Permitted
          Liens.

(b)    
          The security interest granted pursuant to this Agreement shall constitute a
          valid and continuing perfected security interest in favor of the Administrative
          Agent in the Collateral comprised of Australian Intellectual Property for which
          perfection is governed by any personal property security legislation of
          Australia or filing with IP Australia upon (i) the completion of the
          filings and other actions specified on Schedule 3 (Filings) (which,
          in the case of all filings and other documents referred to on such schedule,
          have been delivered to the Administrative Agent in completed and duly executed
          form) and (ii) all appropriate filings having been made with IP Australia.
          Such security interest shall be prior to all other Liens on the Collateral
          except for (a) Customary Permitted Liens and (b ) purchase money security
          interests that are Permitted Liens.

(c)    
          The security interest granted pursuant to this Agreement shall constitute a
          valid and continuing perfected security interest in favor of the Administrative
          Agent in the Canadian Collateral for which perfection is governed by any
          personal property security legislation of Canada, or filing with the Canadian
          Intellectual Property Office upon (i) the completion of the filings and
          other actions specified on Schedule 3 (Filings) (which, in the case
          of all filings and other documents referred to on such schedule, have been
          delivered to the Administrative Agent in completed and duly executed form),
          (ii) the delivery to the Administrative Agent of all Collateral consisting
          of Instruments and Certificated Securities, in each case properly endorsed for
          transfer to the Administrative Agent or in blank and (iii) all appropriate
          filings having been made with the Canadian Intellectual Property Office. Such
          security interest shall be prior to all other Liens on the Collateral except for
          (a) Customary Permitted Liens and (b ) purchase money security interests that
          are Permitted Liens.

Section 3.3
Jurisdiction of Organization; Chief Executive Office

Such
Grantors jurisdiction of organization, legal name, organizational identification
number, if any, and the location of such Grantors chief executive office or sole
place of business, in each case as of the date hereof, is specified on

Schedule 1
(Jurisdiction of Organization; Principal Executive Office) and such

Schedule 1
(Jurisdiction of Organization; Principal Executive Office) also lists all
jurisdictions of incorporation, legal names and locations of such Grantors chief
executive office or sole place of business for the five years preceding the date hereof.

Section 3.4
Inventory and Equipment

On
the date hereof, such Grantors Inventory and Equipment (other than mobile goods,
Inventory or Equipment in transit, Inventory or Equipment subject to Tooling Arrangements
and Inventory or Equipment used for evaluation and demonstration purposes) are kept at the
locations listed on Schedule 4 (Location of Inventory and Equipment)and such
Schedule 4 (Location of Inventory and Equipment) also list the locations of
such Inventory and Equipment for the five years preceding the date hereof.

Section 3.5 Pledged
Collateral

(a)    
          The Pledged Stock pledged hereunder or pursuant to a Foreign Share Pledge
          Agreement by such Grantor is listed on Schedule 2 (Pledged
          Collateral) and constitute that percentage of the issued and outstanding
          equity of all classes of each issuer thereof as set forth on Schedule 2
          (Pledged Collateral).

(b)    
          All of the Pledged Stock has been duly authorized, validly issued and are fully
          paid and nonassessable.

(c)    
          Each of the Pledged Stock constitutes the legal, valid and binding obligation of
          the obligor with respect thereto, enforceable in accordance with its terms,
          subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
          reorganization, moratorium and other similar laws relating to or affecting
          creditors rights generally, and general equitable principles (whether
          considered in a proceeding in equity or at law).

(d)    
          All Pledged Collateral and, if applicable, any Additional Pledged Collateral,
          consisting of Certificated Securities or Instruments has been delivered to the
          Administrative Agent in accordance with Section 4.4(a) (Pledged
          Collateral); provided, that to the extent any Pledged Collateral
          shall not have been delivered to the Administrative Agent on the Closing Date,
          the Borrower shall use its best efforts to deliver such Pledged Collateral to
          the Administrative Agent within 30 days after the date hereof (or such later
          date as may be agreed to by the Administrative Agent).

(e)    
          All Pledged Collateral held by a Securities Intermediary in a Securities Account
          is in a Control Account; provided that Financial Assets having a value in
          the aggregate that is less that $250,000 individually and $1,000,000 in the
          aggregate (taken together with other such Financial Assets) shall not be
          required to be maintained in a Control Account.

(f)    
          Other than (i) Pledged Stock constituting General Intangibles, (ii) Instruments
          having a principal face amount of less than $250,000 individually and $1,000,000
          in the aggregate (taken together with other such Instruments) and (iii) Chattel
          Paper, there is no Pledged Collateral other than that represented by
          Certificated Securities or Instruments in the possession of the Administrative
          Agent or that consisting of Financial Assets held in a Control Account.

Section 3.6 Accounts

No
amount payable to such Grantor under or in connection with any Account is evidenced by any
Instrument (other than bank checks and like instruments received in the ordinary course of
business) in a principal face amount in excess of $250,000 individually and $1,000,000
(taken together with other such Instruments) in the aggregate that has not been delivered
to the Administrative Agent, properly endorsed for transfer, to the extent delivery is
required by Section 4.4 (Pledged Collateral). If any amount payable under or
in connection with any of the Pledged Collateral is evidenced by Chattel Paper, such
Chattel Paper is in the possession of the Grantors.

Section 3.7
Intellectual Property

(a)    
          Part A of Schedule 5 (Intellectual Property)lists all Material
          Intellectual Property of such Grantor on the date hereof and Part B of
          Schedule 5 (Intellectual Property) lists all other Intellectual
          Property of such Grantor on the date hereof, in each case separately identifying
          that owned by such Grantor and that licensed by or to such Grantor and other
          than commercial off the shelf software licenses and trade secrets. The Material
          Intellectual Property set forth on Schedule 5 (Intellectual
          Property) for such Grantor constitutes all of the intellectual property
          rights (other than commercial off the shelf software licenses and trade secrets)
          necessary to conduct its business as currently and as proposed to be conducted.

(b)    
          All Material Intellectual Property owned by such Grantor is valid, in full force
          and effect, subsisting, unexpired and enforceable, has not been adjudged invalid
          and has not been abandoned, and to the Grantors knowledge, the use thereof
          in the business of such Grantor does not infringe, misappropriate, dilute or
          violate the intellectual property rights of any other Person.

(c)    
          Except as set forth in Schedule 5 (Intellectual Property), none of
          the Material Intellectual Property (other than commercial off the shelf software
          licenses) owned by such Grantor is the subject of any licensing or franchise
          agreement pursuant to which such Grantor is the licensor or franchisor.

(d)    
          No holding, decision or judgment has been rendered by any Governmental Authority
          that would limit, cancel or question the validity of, or such Grantors
          rights in, any Material Intellectual Property.

(e)    
          Except as set forth in Schedule 5A (Intellectual Property Matters), no
          action or proceeding seeking to limit, cancel or question the validity of any
          Material Intellectual Property owned by such Grantor or such Grantors
          ownership interest therein is pending or, to the knowledge of such Grantor,
          threatened. There are no claims, judgments or settlements to be paid by such
          Grantor relating to the Material Intellectual Property.

Section 3.8 Deposit
Accounts; Securities Accounts

The
only Deposit Accounts or Securities Accounts maintained by any Grantor on the date hereof
are those listed on Schedule 6 (Deposit Accounts; Securities Accounts), which
sets forth such information separately for each Grantor.

Section 3.9
Commercial Tort Claims

The
only Commercial Tort Claims of any Grantor existing on the date hereof and known to the
Grantors (regardless of whether the amount, defendant or other material facts can be
determined and regardless of whether such Commercial Tort Claim has been asserted,
threatened or has otherwise been made known to the obligee thereof or whether litigation
has been commenced for such claims), if any, are those listed on Schedule 7
(Commercial Tort Claims), which sets forth such information separately for each
Grantor.

# ARTICLE IV  COVENANTS

Each
Grantor agrees with the Administrative Agent to the following, as long as any Obligation
or Commitment remains outstanding and, in each case, unless the Requisite Lenders
otherwise consent in writing:

Section 4.1 Generally

Such
Grantor shall (a) except for the security interest created by this Agreement, not
create or suffer to exist any Lien upon or with respect to any Collateral, except
Permitted Liens, (b) not knowingly use or permit any Collateral to be used unlawfully
or in violation of any provision of this Agreement, any other Loan Document, or any policy
of insurance covering any material portion or amount of the Collateral, (c) not sell,
transfer or assign (by operation of law or otherwise) any Collateral if such sale,
transfer or assignment would be prohibited under the Credit Agreement, (d) not enter
into any agreement or undertaking restricting the right or ability of such Grantor or the
Administrative Agent to sell, assign or transfer any Collateral if such restriction would
have a Material Adverse Effect and (e) promptly notify the Administrative Agent of
its entry into any agreement or assumption of undertaking that restricts the ability to
sell, assign or transfer any material portion or amount of Collateral regardless of
whether or not it has a Material Adverse Effect.

Section 4.2
Maintenance of Perfected Security Interest; Further Documentation

(a)    
          Such Grantor shall maintain the security interest created by this Agreement as a
          perfected security interest having at least the priority described in
          Section 3.2 (Perfection and Priority)and shall defend such
          security interest of such priority against the claims and demands of all
          Persons.

(b)    
          Such Grantor shall furnish to the Administrative Agent from time to time
          statements and schedules further identifying and describing the Collateral and
          such other reports in connection with the Collateral as the Administrative Agent
          may reasonably request, all in reasonable detail and in form and substance
          satisfactory to the Administrative Agent.

(c)    
          At any time and from time to time, upon the written request of the
          Administrative Agent, and at the sole expense of such Grantor, such Grantor
          shall promptly and duly execute and deliver, and have recorded, such further
          instruments and documents and take such further action as the Administrative
          Agent 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 the filing of any financing or continuation statement under the UCC
          (or other similar laws, including with respect to the Australian Intellectual
          Property or with respect to the Canadian Collateral, personal property security
          legislation and other laws of Australia or Canada, respectively) in effect in
          any jurisdiction with respect to the security interest created hereby, the
          execution and delivery of Deposit Account Control Agreements and Control Account
          Agreements and the execution and delivery of additional foreign charges, pledge
          agreements, security agreements and other Collateral Documents as may reasonably
          be requested by the Administrative Agent to perfect its Lien on the Stock or
          Stock Equivalents owned by such Grantor in its Foreign Subsidiaries under the
          laws of the jurisdiction of organization of any Foreign Subsidiary organized
          under the laws of Australia, Canada, Mexico, the United Kingdom, Luxembourg, or
          such other jurisdictions as may be reasonably required by the Administrative
          Agent.

Section 4.3 Changes
in Locations, Name, Etc.

|(a) | Except upon 15 days prior written notice to the Administrative Agent and
          delivery to the Administrative Agent of (i) all additional financing
          statements and other documents reasonably requested by the Administrative Agent
          to maintain the validity, perfection and priority of the security interests
          provided for herein and (ii) if applicable, a written supplement to
          Schedule 4 (Location of Inventory and Equipment) showing
          (A) any additional locations at which Inventory or Equipment shall be kept
          or (B) any changes in any location where Inventory or Equipment shall be
          kept that would require the Administrative Agent to take any action to maintain
          a perfected security interest in such Collateral, such Grantor shall not do any
          of the following:
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(i) | permit any Inventory or Equipment having a Fair Market Value in excess of
          $1,000,000 in the aggregate to be kept at a location other than those listed on
          Schedule 4 (Location of Inventory and Equipment), except for
          Inventory or Equipment in transit, Inventory or Equipment subject to Tooling
          Arrangements, and Inventory or Equipment used for evaluation and demonstration
          purposes;
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(ii) | change its jurisdiction of organization or the location of its chief executive
          office, in each case from that referred to in Section 3.3 (Jurisdiction
          of Organization; Chief Executive Office); or
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(iii) | change its name, identity or corporate structure to such an extent that any
          financing statement filed in connection with this Agreement would become
          misleading.
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | Such Grantor shall keep and maintain at its own cost and expense satisfactory
          and complete records of the Collateral, including a record of all payments
          received and all credits granted with respect to the Collateral and all other
          dealings with the Collateral. If requested by the Administrative Agent, the
          security interest of the Administrative Agent shall be noted on the certificate
          of title of each Vehicle; provided that the Grantors shall not be required to
          note the security interest of the Administrative Agent on the certificate of
          title for any Vehicle having a book value of less than $30,000.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Section 4.4 Pledged
Collateral

(a)    
          Such Grantor shall (i) deliver to the Administrative Agent, all
          certificates and Instruments and other documents representing or evidencing any
          Pledged Collateral (including such certificates representing or evidencing the
          Pledged Stock of a Grantor in its foreign Subsidiaries required to be pledged
          hereunder and Additional Pledged Collateral), whether now existing or hereafter
          acquired, in suitable form for transfer by delivery or, as applicable,
          accompanied by such Grantors endorsement, where necessary, or duly
          executed instruments of transfer or assignment in blank, all in form and
          substance satisfactory to the Administrative Agent, together, in respect of any
          Additional Pledged Collateral, with a Pledge Amendment, duly executed by the
          Grantor, in substantially the form of Annex 3 (Form of Pledge
          Amendment), an acknowledgment and agreement to a Joinder Agreement duly
          executed by the Grantor, in substantially the form in the form of
          Annex 4 (Form of Joinder Agreement), or such other documentation
          acceptable to the Administrative Agent and (ii) maintain all other Pledged
          Collateral constituting Investment Property in a Control Account. Such Grantor
          authorizes the Administrative Agent to attach each Pledge Amendment to this
          Agreement. The Administrative Agent shall have the right, at any time in its
          discretion and without notice to the Grantor, to transfer to or to register in
          its name or in the name of its nominees any Pledged Collateral. The
          Administrative Agent shall have the right at any time to exchange any
          certificate or instrument representing or evidencing any Pledged Collateral for
          certificates or instruments of smaller or larger denominations. Notwithstanding
          the foregoing, the Grantors shall not be required to deliver to the
          Administrative Agent any Instrument having a principal face amount of less than
          $250,000 individually and $1,000,000 in the aggregate (taken together with other
          such Instruments).

(b)    
          Except as provided in Article V (Remedial Provisions), such
          Grantor shall be entitled to receive all cash dividends paid in respect of the
          Pledged Collateral (other than liquidating or distributing dividends) with
          respect to the Pledged Collateral. Any sums paid upon or in respect of any
          Pledged Collateral upon the liquidation or dissolution of any issuer of any
          Pledged Collateral, any distribution of capital made on or in respect of any
          Pledged Collateral or any property distributed upon or with respect to any
          Pledged Collateral pursuant to the recapitalization or reclassification of the
          capital of any issuer of Pledged Collateral or pursuant to the reorganization
          thereof shall, unless otherwise subject to a perfected security interest in
          favor of the Administrative Agent, be delivered to the Administrative Agent to
          be held by it hereunder as additional collateral security for the Secured
          Obligations. If any sum of money or property so paid or distributed in respect
          of any Pledged Collateral shall be received by such Grantor, such Grantor shall,
          until such money or property is paid or delivered to the Administrative Agent,
          hold such money or property in trust for the Administrative Agent, segregated
          from other funds of such Grantor, as additional security for the Secured
          Obligations.

(c)    
          Except as provided in Article V (Remedial Provisions), such Grantor shall
          be entitled to exercise all voting, consent and corporate, partnership, limited
          liability company and similar rights with respect to the Pledged Collateral;
          provided, however, that no vote shall be cast, consent given or
          right exercised or other action taken by such Grantor that would impair the
          Collateral, be inconsistent with or result in any violation of any provision of
          the Credit Agreement, this Agreement or any other Loan Document or, without
          prior notice to the Administrative Agent, enable or permit any issuer of Pledged
          Collateral to issue any Stock or other equity Securities of any nature or to
          issue any other securities convertible into or granting the right to purchase or
          exchange for any Stock or other equity Securities of any nature of any issuer of
          Pledged Collateral.

(d)    
          Such Grantor shall not grant control over any Investment Property to any Person
          other than the Administrative Agent.

(e)    
          In the case of each Grantor that is an issuer of Pledged Collateral, such
          Grantor agrees to be bound by the terms of this Agreement relating to the
          Pledged Collateral issued by it and shall comply with such terms insofar as such
          terms are applicable to it. In the case of any Grantor that is a holder of any
          Stock or Stock Equivalent in any Person that is an issuer of Pledged Collateral,
          such Grantor consents to (i) the exercise of the rights granted to the
          Administrative Agent hereunder (including those described in Section 5.3
          (Pledged Collateral)),and (ii) the pledge by each other
          Grantor, pursuant to the terms hereof, of the Pledged Stock in such Person and
          to the transfer of such Pledged Stock to the Administrative Agent or its nominee
          and to the substitution of the Administrative Agent or its nominee as a holder
          of such Pledged Stock with all the rights, powers and duties of other holders of
          Pledged Stock of the same class and, if the Grantor having pledged such Pledged
          Stock hereunder had any right, power or duty at the time of such pledge or at
          the time of such substitution beyond that of such other holders, with all such
          additional rights, powers and duties. Such Grantor agrees to execute and deliver
          to the Administrative Agent such certificates, agreements and other documents as
          may be reasonably necessary to evidence, formalize or otherwise give effect to
          the consents given in this clause (e).

(f)    
          Such Grantor shall not, without the consent of the Agents, agree to any
          amendment of any Constituent Document that in any way adversely affects the
          perfection of the security interest of the Administrative Agent in the Pledged
          Collateral pledged by such Grantor hereunder, including any amendment electing
          to treat any membership interest or partnership interest that is part of the
          Pledged Collateral as a security under Section 8-103 of the UCC, or any
          election to turn any previously uncertificated Stock that is part of the Pledged
          Collateral into certificated Stock, unless such treatment or election would
          adversely affect the perfection of the Administrative Agents security
          interest in such Pledged Collateral.

Section 4.5 Control
Accounts; Approved Deposit Accounts

|(a) | (i) No Grantor shall establish or maintain any Concentration Account that is not
          subject to a first priority perfected security interest in favor of the
          Administrative Agent for the benefit of the Secured Parties (subject only to
          Permitted Liens). On the Closing Date (or such later date as may be agreed to by
          the Administrative Agent), each Grantor shall have delivered to the
          Administrative Agent a Deposit Account Control Agreement with respect to each
          Concentration Account, in form and substance satisfactory to the Administrative
          Agent.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(ii) | Notwithstanding anything in the foregoing clause (i) to the contrary, to
          the extent that that a Deposit Account Control Agreement with respect to each
          Concentration Account existing on the Closing Date that was established prior to
          the Closing Date shall not have been delivered to the Administrative Agent on
          the Closing Date, the Grantors shall either (i) within 30 days after the Closing
          Date cause the applicable Deposit Account Bank with which such Concentration
          Account is maintained to enter into a Deposit Account Control Agreement
          sufficient to perfect the Administrative Agents security interest in such
          Concentration Account and all deposits therein or (ii) within 60 days after the
          Closing Date, close such Concentration Account; provided, however,
          if such Concentration Account is an account to which any Grantors
          customers have been instructed to make payments (or an account associated with
          an address to which any Grantors customers have been instructed to make
          payments), and within 60 days after the date of this Agreement such customers
          shall have been instructed to make payments thereafter to a new Concentration
          Account that is subject to a Deposit Account Control Agreement, then the 60 day
          period referred to in this clause (ii)shall be extended to 90 days after
          the Closing Date.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(b) | (i) No Grantor shall establish or maintain any Securities Account that is not
          subject to a first priority perfected security interest in favor of the
          Administrative Agent for the benefit of the Secured Parties (subject only to
          Permitted Liens), which security interest shall be perfected by
          control within the meaning of Sections 8-106 and 9-106 of the UCC.
          On the Closing Date (or such later date as may be agreed to by the
          Administrative Agent), each Grantor shall have delivered to the Administrative
          Agent a Control Account Agreement with respect to each Securities Account, in
          form and substance satisfactory to the Administrative Agent.
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(ii) | Notwithstanding anything in the foregoing clause (i) to the contrary, to
          the extent that that a Control Account Agreement with respect to each Securities
          Account existing on the Closing Date that was established prior to the Closing
          Date shall not have been delivered to the Administrative Agent on the Closing
          Date, the Grantors shall either (i) within 30 days after the Closing Date cause
          the Securities Intermediary with which such Securities Account is maintained to
          enter into a Control Account Agreement sufficient to perfect the Administrative
          Agents security interest in such Securities Account and any Financial
          Assets credit to such Securities Account by control within the
          meaning of Sections 8-106 and 9-106 of the UCC, or (ii) within 60 days after the
          date of this Agreement close such Securities Account.
|---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(c) | No Grantor shall permit the amount of cash or Cash Equivalents held by the
          Grantors that is not maintained in a Concentration Account, a Cash Collateral
          Account, or a Securities Account with respect to which the Administrative Agent
          for the benefit of the Secured Parties has a first priority perfected Lien to
          exceed in the aggregate $1,000,000 for any period of more than five consecutive
          Business Days; provided, however, that the Grantors shall use
          commercially reasonable efforts to prevent the amount of cash and Cash
          Equivalents held by the Grantors and not maintained in a Concentration Account,
          a Cash Collateral Account or a Securities Account from exceeding such $1,000,000
          limit.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(d) | Notwithstanding the foregoing provisions of this Section 4.5 (Control
          Accounts; Approved Deposit Accounts), or the provisions of any other
          provision of this Agreement or any other Loan Document, the Grantors shall be
          entitled to maintain Qualified Hedging Contract Accounts which shall not be
          subject to any security interest in favor of the Administrative Agent and with
          respect to which the Grantors shall not be required to obtain Deposit Account
          Control Agreements or Control Account Agreements.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(e) | The Administrative Agent agrees with each Grantor that the Administrative Agent
          shall not give any notice of sole control, notice of exclusive control, blocked
          account notice, blockage notice, notice of termination of withdrawal rights or
          similar notice, instruction, direction, order or request to any Deposit Account
          Bank under any Deposit Account Control Agreement or otherwise, or any Securities
          Intermediary under any Control Account Agreement or otherwise, unless an Event
          of Default has occurred and is continuing.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(f) | Unless an Event of Default has occurred and is continuing, the Grantors shall be
          entitled to use, deal with, make deposits to and make withdrawals from, and
          otherwise direct the disposition of funds in any deposit account that is subject
          to a Deposit Account Control Agreement or otherwise, and to use, deal with, make
          deposits to and make withdrawals from, give entitlement orders with respect to,
          and make dispositions from any securities account that is subject to an Account
          Control Agreement or otherwise.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(g) | The Administrative Agent agrees with each Grantor that unless an Event of
          Default has occurred and is continuing, the Administrative Agent shall not
          request from any Deposit Account Bank under any Deposit Account Control
          Agreement or any Securities Intermediary under any Control Account Agreement any
          account statements, statements of cash balances, reports, or other information
          relating to any deposit account or securities account other than copies of such
          account statements, statements of cash balances, reports or other information
          that are ordinarily provided by the Deposit Account Bank or the Securities
          Intermediary to the applicable Grantor; provided, that nothing in this
          clause (f)shall prohibit, or be deemed to prohibit, the Administrative
          Agent from requesting any such documents, reports or other information from the
          applicable Grantor.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Section 4.6 Accounts

(a)    
          Such Grantor shall not, other than in the ordinary course of business consistent
          with its past practice, (i) grant any extension of the time of payment of
          any Account, (ii) compromise or settle any Account for less than the full
          amount thereof, (iii) release, wholly or partially, any Person liable for
          the payment of any Account, (iv) allow any credit or discount on any
          Account or (v) amend, supplement or modify any Account in any manner that
          could adversely affect the value thereof.

(b)    
          The Administrative Agent shall have the right to make test verifications of the
          Accounts in any manner and through any medium that it reasonably considers
          advisable, and such Grantor shall furnish all such assistance and information as
          the Administrative Agent may reasonably require in connection therewith. Upon
          the Administrative Agents request during the continuance of an Event of
          Default, such Grantor shall, at such Grantors expense, cause independent
          public accountants or others satisfactory to the Administrative Agent to furnish
          to the Administrative Agent reports showing reconciliations, aging and test
          verifications of, and trial balances for, the Accounts.

Section 4.7 Delivery
of Instruments and Chattel Paper

(a)    
          If any amount in excess of $250,000 individually or $1,000,000 in the aggregate
          (taken together with other such Collateral) payable under or in connection with
          any Collateral owned by such Grantor shall be or become evidenced by an
          Instrument, such Grantor shall immediately deliver such Instrument to the
          Administrative Agent, duly indorsed in a manner satisfactory to the
          Administrative Agent, or, if consented to by the Administrative Agent, shall
          mark all such Instruments with the following legend: This writing and the
          obligations evidenced or secured hereby are subject to the security interest of
          Citicorp North America, Inc., as Administrative Agent.

(b)    
          If any amount payable under or in connection with any Collateral owned by the
          Grantors shall be or become evidenced by Chattel Paper, the Grantors shall keep
          such Chattel Paper in the Grantors possession or shall deliver such
          Chattel Paper to the Administrative Agent.

Section 4.8
Intellectual Property

(a)    
          Such Grantor (either itself or through licensees) shall (i) continue to use
          each Trademark that is Material Intellectual Property in order to maintain such
          Trademark in full force and effect with respect to each class of goods for which
          such Trademark is currently used, free from any claim of abandonment for
          non-use, (ii) maintain as in the past the quality of products and services
          offered under such Trademark, (iii) use such Trademark with the appropriate
          notice of registration and all other notices and legends required by applicable
          Requirements of Law, (iv) not adopt or use any mark that is confusingly
          similar or a colorable imitation of such Trademark unless the Administrative
          Agent shall obtain a perfected security interest in such mark pursuant to this
          Agreement and (v) not (and not permit any licensee or sublicensee thereof
          to) do any act or knowingly omit to do any act whereby such Trademark (or any
          goodwill associated therewith) may become destroyed, invalidated, impaired or
          harmed in any way.

(b)    
          Such Grantor (either itself or through licensees) shall not do any act, or omit
          to do any act, whereby any Patent that is Material Intellectual Property may
          become forfeited, abandoned or dedicated to the public.

(c)    
          Such Grantor (either itself or through licensees) (i) shall not (and shall
          not permit any licensee or sublicensee thereof to) do any act or omit to do any
          act whereby any portion of the Copyrights that is Material Intellectual Property
          may become invalidated or otherwise impaired and (ii) shall not (either
          itself or through licensees) do any act whereby any portion of the Copyrights
          that is Material Intellectual Property may fall into the public domain.

(d)    
          Such Grantor (either itself or through licensees) shall not do any act, or omit
          to do any act, whereby any trade secret that is Material Intellectual Property
          may become publicly available or otherwise unprotectable.

(e)    
          Such Grantor (either itself or through licensees) shall not do any act that
          knowingly uses any Material Intellectual Property to infringe, misappropriate,
          dilute or violate the intellectual property rights of any other Person.

(f)    
          Such Grantor shall notify the Administrative Agent immediately if it knows that
          any application or registration relating to any Material Intellectual Property
          is reasonably likely to become forfeited, abandoned or dedicated to the public,
          or of any material adverse determination or development (including the
          institution of, or any such material adverse determination or development in,
          any proceeding in the United States Patent and Trademark Office, the United
          States Copyright Office, the Canadian Intellectual Property Office, IP Australia
          or any court or tribunal in any country, as applicable) regarding such
          Grantors ownership of, right to use, interest in, or the validity of, any
          Material Intellectual Property or such Grantors right to register the same
          or to own and maintain the same.

(g)    
          Whenever such Grantor, either by itself or through any agent, licensee or
          designee, shall file an application for the registration of any Intellectual
          Property with the United States Patent and Trademark Office, the United States
          Copyright Office or any similar office or agency within or outside the United
          States or register any Internet domain name, such Grantor shall report such
          filing to the Administrative Agent on each date on which the Borrower is
          required to deliver to the Administrative Agent the Financial Statements
          required pursuant to Section 6.1(b) (Financial Statements) of the Credit
          Agreement (or, in the case of any Fiscal Quarter ending on or about December 31,
          within 45 days after the last day of such Fiscal Quarter), which report shall
          include a list of all filings made by such Grantor since the date of delivery of
          the immediately preceding report (it being understood that the first such report
          delivered to the Administrative Agent shall include all such filings from and
          after the Closing Date through the date of such delivery). Upon request of the
          Administrative Agent, such Grantor shall execute and deliver, and have recorded,
          all agreements, instruments, documents and papers as the Administrative Agent
          may reasonably request to evidence the Administrative Agents security
          interest in any Copyright, Patent, Trademark or Internet domain name and the
          goodwill and general intangibles of such Grantor relating thereto or represented
          thereby.

(h)    
          Such Grantor shall take all reasonable actions necessary or requested by the
          Administrative Agent, including in any proceeding before (i) in the case of
          Intellectual Property other than Australian Intellectual Property and Canadian
          Intellectual Property, the United States Patent and Trademark Office, the United
          States Copyright Office or any similar office or agency, (ii) in the case of
          Australian Intellectual Property, IP Australia or any similar office or agency,
          and (iii) in the case of Canadian Intellectual Property, the Canadian
          Intellectual Property Office or any similar office or agency, or any court or
          tribunal in Canada, and in each case, before any Internet domain name registrar,
          to maintain and pursue each application (and to obtain the relevant
          registration) and to maintain each registration of any Copyright, Trademark,
          Patent or Internet domain name that is Material Intellectual Property, including
          filing of applications for renewal, affidavits of use, affidavits of
          incontestability and opposition and interference and cancellation proceedings.

(i)    
          In the event that Grantor has knowledge, or a reasonable belief after
          consultation with intellectual property counsel, that any Material Intellectual
          Property has been misappropriated or diluted by a third party, or any such
          Intellectual Property is or has been infringed upon, such Grantor shall notify
          the Administrative Agent promptly after such Grantor learns thereof. Such
          Grantor shall take appropriate action in response to such infringement,
          misappropriation or dilution, including (if such Grantor determines that such
          action is appropriate in its reasonable business judgment or such action is
          reasonably requested by the Administrative Agent) promptly bringing suit for
          infringement, misappropriation or dilution and to recover all damages for such
          infringement, misappropriation of dilution, and shall take such other actions
          may be appropriate in its reasonable judgment under the circumstances to protect
          such Material Intellectual Property.

(j)    
          Unless otherwise agreed to by the Administrative Agent, such Grantor shall
          execute and deliver to the Administrative Agent for filing in (i) the
          United States Copyright Office, IP Australia and the Canadian Intellectual
          Property Office, a short-form copyright security agreement in the form attached
          hereto as Annex 5 (Form of Short Form Copyright Security Agreement),
          (ii) in the United States Patent and Trademark Office and with the
          Secretary of State of all appropriate States of the United States, IP Australia
          and the Canadian Intellectual Property Office, a short-form patent security
          agreement in the form attached hereto as Annex 6 (Form of Short Form
          Patent Security Agreement), (iii) the United States Patent and
          Trademark Office, IP Australia and the Canadian Intellectual Property Office, a
          short-form trademark security agreement in form attached hereto as
          Annex 7 (Form of Short Form Trademark Security Agreement) and
          (iv) with respect to any Internet domain name that is Material Intellectual
          Property, with the appropriate Internet domain name registrar, a duly executed
          form of assignment of such Internet domain name to the Administrative Agent
          (together with appropriate supporting documentation as may be requested by the
          Administrative Agent) in form and substance reasonably acceptable to the
          Administrative Agent. In the case of clause (iv) above, each Grantor
          agrees to perform all appropriate actions (including, without limitation, the
          completion and filing, or delivery to the Administrative Agent for filing, of
          such assignment) deemed necessary by the Administrative Agent for the
          Administrative Agent to ensure such Internet domain name that constitutes
          Material Intellectual Property is registered in the name of the Administrative
          Agent.

Section 4.9 Vehicles

Upon
the written request of the Administrative Agent, within 45 days after the date of such
request and, with respect to any Vehicle acquired by such Grantor subsequent to the date
of any such request, within 45 days after the date of acquisition thereof, such Grantor
shall file all applications for certificates of title or ownership indicating the
Administrative Agents security interest in the Vehicle covered by such certificate
and any other necessary documentation, in each office in each jurisdiction that the
Administrative Agent shall deem advisable to perfect its security interests in the
Vehicles; provided that the Grantors shall not be required to file any such applications
or other documentation for any Vehicle having a book value of less than $30,000.

Section 4.10 Payment
of Obligations

Such
Grantor shall pay and discharge or otherwise satisfy at or before maturity or before they
become delinquent, as the case may be, all taxes, assessments and governmental charges or
levies imposed upon the Collateral or in respect of income or profits therefrom, as well
as all claims of any kind (including claims for labor, materials and supplies) against or
with respect to the Collateral, except that no such charge need be paid if the amount or
validity thereof is currently being contested in good faith by appropriate proceedings,
reserves in conformity with GAAP with respect thereto have been provided on the books of
such Grantor and such proceedings could not reasonably be expected to result in the sale,
forfeiture or loss of any material portion of the Collateral or any interest therein.

Section 4.11 Notice
of Commercial Tort Claims

Such
Grantor agrees that, if it shall acquire any interest in any Commercial Tort Claim
(whether from another Person or because such Commercial Tort Claim shall have come into
existence), in an amount in excess of $1,000,000, (i) such Grantor shall, immediately
upon such acquisition, deliver to the Administrative Agent, in each case in form and
substance satisfactory to the Administrative Agent, a notice of the existence and nature
of such Commercial Tort Claim and deliver a supplement to Schedule 7 (Commercial
Tort Claims) containing a specific description of such Commercial Tort Claim,
(ii) the provision of Section 2.1 (Collateral) shall apply to such
Commercial Tort Claim and (iii) such Grantor shall execute and deliver to the
Administrative Agent, in each case in form and substance satisfactory to the
Administrative Agent, any certificate, agreement and other document, and take all other
action, deemed by the Administrative Agent to be reasonably necessary or appropriate for
the Administrative Agent to obtain, on behalf of the Lenders, a first-priority, perfected
security interest in all such Commercial Tort Claims. Any supplement to Schedule 7
(Commercial Tort Claims) delivered pursuant to this Section 4.11 (Notice of
Commercial Tort Claims) shall, after the receipt thereof by the Administrative Agent,
become part of Schedule 7 (Commercial Tort Claims) for all purposes hereunder
other than in respect of representations and warranties made prior to the date of such
receipt. No Grantor shall be deemed to hold or to have acquired any Commercial Tort Claim
unless and until such Grantor shall have filed such Commercial Tort Claim in a court or
tribunal having jurisdiction over such Commercial Tort Claim.

Section 4.12
Acknowledgement of Security Interest

The
Grantors and the Administrative Agent acknowledge and agree that this Agreement is
intended to grant to the Administrative Agent for the benefit of the Secured Parties a
security interest in the Collateral and shall not constitute a present assignment of any
of the Collateral.

# ARTICLE V  REMEDIAL
PROVISIONS

Section 5.1 Code and
Other Remedies

(a)    
          During the continuance of an Event of Default, the Administrative Agent may
          exercise, in addition to all other rights and remedies granted to it in this
          Agreement and in any other instrument or agreement securing, evidencing or
          relating to the Secured Obligations, all rights and remedies of a secured party
          under the UCC or any other applicable Requirements of Law (including, with
          respect to the Australian Intellectual Property or with respect to the Canadian
          Collateral, personal property security legislations and other laws of Australia
          or Canada as the case may be). Without limiting the generality of the foregoing,
          the Administrative Agent, without demand of performance or other demand,
          presentment, protest, advertisement or notice of any kind (except any notice
          required by law referred to below) to or upon any Grantor or any other Person
          (all and each of which demands, defenses, advertisements and notices are hereby
          waived), may in during the continuation of an Event of Default forthwith
          collect, receive, appropriate and realize upon any Collateral, and may forthwith
          sell, lease, assign, give option or options to purchase, or otherwise dispose of
          and deliver any Collateral (or contract to do any of the foregoing), in one or
          more parcels at public or private sale or sales, at any exchange, brokers
          board or office of the Administrative Agent or any Lender or elsewhere upon such
          terms and conditions as it may deem advisable and at such prices as it may deem
          best, for cash or on credit or for future delivery without assumption of any
          credit risk. The Administrative Agent shall have the right upon any such public
          sale or sales, and, to the extent permitted by law, upon any such private sale
          or sales, to purchase the whole or any part of the Collateral so sold, free of
          any right or equity of redemption in any Grantor, which right or equity is
          hereby waived and released. Each Grantor further agrees, at the Administrative
          Agents request, to assemble the Collateral and make it available to the
          Administrative Agent at places that the Administrative Agent shall reasonably
          select, whether at such Grantors premises or elsewhere. The Administrative
          Agent shall apply the net proceeds of any action taken by it pursuant to this
          Section 5.1, after deducting all reasonable costs and expenses of
          every kind incurred in connection therewith or incidental to the care or
          safekeeping of any Collateral or in any way relating to the Collateral or the
          rights of the Administrative Agent and any other Secured Party hereunder,
          including reasonable attorneys fees and disbursements, to the payment in
          whole or in part of the Secured Obligations, in such order as the Credit
          Agreement shall prescribe, and only after such application and after the payment
          by the Administrative Agent of any other amount required by any provision of
          law, need the Administrative Agent account for the surplus, if any, to any
          Grantor. To the extent permitted by applicable law, each Grantor waives all
          claims, damages and demands it may acquire against the Administrative Agent or
          any other Secured Party arising out of the exercise by them of any rights
          hereunder. If any notice of a proposed sale or other disposition of Collateral
          shall be required by law, such notice shall be deemed reasonable and proper if
          given at least 10 days before such sale or other disposition.

(b)    
          During the occurrence and continuance of an Event of Default, the Administrative
          Agent may appoint or reappoint by instrument in writing, any Person or Persons,
          whether an officer or officers or an employee or employees of the Administrative
          Agent or not, to be an interim receiver, receiver or receivers (hereinafter
          called a Receiver) of the Canadian Collateral (including any
          interest, income or profits therefrom) and may remove any Receiver so appointed
          and appoint another in such Persons stead. Any such Receiver shall, so far
          as concerns responsibility for such Persons acts, be deemed the agent of
          Grantors and not of the Administrative Agent or any of the Secured Parties, and
          neither the Administrative Agent nor any of the Secured Parties shall be in any
          way responsible for any misconduct, negligence or non-feasance on the part of
          any such Receiver or such Persons servants, agents, officers or employees.
          The Receiver may exercise any or all of the powers and rights given to the
          Administrative Agent under this Article V (Remedial Provisions).

Section 5.2 Accounts
and Payments in Respect of General Intangibles

(a)    
          In addition to, and not in substitution for, any similar requirement in the
          Credit Agreement, if required by the Administrative Agent at any time during the
          continuance of an Event of Default, any payment of Accounts or payment in
          respect of General Intangibles, when collected by any Grantor, 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 the
          Administrative Agent, in an Approved Deposit Account or a Cash Collateral
          Account, subject to withdrawal by the Administrative Agent as provided in
          Section 5.4 (Proceeds to be Turned Over To Administrative Agent).
          Until so turned over or turned over, such payment shall be held by such Grantor
          in trust for the Administrative Agent, segregated from other funds of such
          Grantor. Each such deposit of Proceeds of Accounts and payments in respect of
          General Intangibles shall be accompanied by a report identifying in reasonable
          detail the nature and source of the payments included in the deposit.

(b)    
          At the Administrative Agents request, during the continuance of an Event
          of Default, each Grantor shall deliver to the Administrative Agent all original
          and other documents evidencing, and relating to, the agreements and transactions
          that gave rise to the Accounts or payments in respect of General Intangibles,
          including all original orders, invoices and shipping receipts.

(c)    
          The Administrative Agent may, without notice, at any time during the continuance
          of an Event of Default, limit or terminate the authority of a Grantor to collect
          its Accounts or amounts due under General Intangibles or any thereof.

(d)    
          The Administrative Agent in its own name or in the name of others may at any
          time during the continuance of an Event of Default communicate with Account
          Debtors to verify with them to the Administrative Agents satisfaction the
          existence, amount and terms of any Account or amounts due under any General
          Intangible.

(e)    
          Upon the request of the Administrative Agent at any time during the continuance
          of an Event of Default, each Grantor shall notify Account Debtors that the
          Accounts or General Intangibles have been collaterally assigned to the
          Administrative Agent and that payments in respect thereof shall be made directly
          to the Administrative Agent. In addition, the Administrative Agent may at any
          time during the continuance of an Event of Default enforce such Grantors
          rights against such Account Debtors and obligors of General Intangibles.

(f)    
          Anything herein to the contrary notwithstanding, each Grantor shall remain
          liable under each of the Accounts and payments in respect of General Intangibles
          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 thereto. Neither the Administrative Agent nor any other Secured
          Party shall have any obligation or liability under any agreement giving rise to
          an Account or a payment in respect of a General Intangible by reason of or
          arising out of this Agreement or the receipt by the Administrative Agent nor any
          other Secured Party of any payment relating thereto, nor shall the
          Administrative Agent nor any other Secured Party be obligated in any manner to
          perform any obligation of any Grantor under or pursuant to any agreement giving
          rise to an Account or a payment in respect of a General Intangible, 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
          thereunder, to present or file any claim, to take any action to enforce any
          performance or to collect the payment of any amounts that may have been assigned
          to it or to which it may be entitled at any time or times.

Section 5.3 Pledged
Collateral

(a)    
          During the continuance of an Event of Default, upon notice by the Administrative
          Agent to the relevant Grantor or Grantors, (i) the Administrative Agent
          shall have the right to receive any Proceeds of the Pledged Collateral and make
          application thereof to the Obligations in the order set forth in the Credit
          Agreement and (ii) the Administrative Agent or its nominee may exercise
          (A) any voting, consent, corporate and other right pertaining to the
          Pledged Collateral at any meeting of shareholders, partners or members, as the
          case may be, of the relevant issuer or issuers of Pledged Collateral or
          otherwise and (B) any right of conversion, exchange and subscription and
          any other right, privilege or option pertaining to the Pledged Collateral as if
          it were the absolute owner thereof (including the right to exchange at its
          discretion any of the Pledged Collateral upon the merger, amalgamation,
          consolidation, reorganization, recapitalization or other fundamental change in
          the corporate structure of any issuer of Pledged Stock, the right to deposit and
          deliver any Pledged Collateral with any committee, depositary, transfer agent,
          registrar or other designated agency upon such terms and conditions as the
          Administrative Agent may determine), all without liability except to account for
          property actually received by it; provided, however, that the
          Administrative Agent shall have no duty to any Grantor to exercise any such
          right, privilege or option and shall not be responsible for any failure to do so
          or delay in so doing.

(b)    
          In order to permit the Administrative Agent to exercise the voting and other
          consensual rights that it may be entitled to exercise pursuant hereto and to
          receive all dividends and other distributions that it may be entitled to receive
          hereunder, (i) each Grantor shall promptly execute and deliver (or cause to
          be executed and delivered) to the Administrative Agent all such proxies,
          dividend payment orders and other instruments as the Administrative Agent may
          from time to time reasonably request and (ii) without limiting the effect
          of clause (i)above, such Grantor hereby grants to the
          Administrative Agent an irrevocable proxy to vote all or any part of the Pledged
          Collateral and to exercise all other rights, powers, privileges and remedies to
          which a holder of the Pledged Collateral would be entitled (including giving or
          withholding written consents of shareholders, partners or members, as the case
          may be, calling special meetings of shareholders, partners or members, as the
          case may be, and voting at such meetings), which proxy shall be effective,
          automatically and without the necessity of any action (including any transfer of
          any Pledged Collateral on the record books of the issuer thereof) by any other
          person (including the issuer of such Pledged Collateral or any officer or agent
          thereof) during the continuance of an Event of Default and which proxy shall
          only terminate upon the payment in full of the Secured Obligations.

(c)    
          Each Grantor hereby expressly authorizes and instructs each issuer of any
          Pledged Collateral pledged hereunder by such Grantor to (i) comply with any
          instruction received by it from the Administrative Agent in writing that
          (A) states that an Event of Default has occurred and is continuing and
          (B) is otherwise in accordance with the terms of this Agreement, without
          any other or further instructions from such Grantor, and each Grantor agrees
          that such issuer shall be fully protected in so complying and (ii) unless
          otherwise expressly permitted hereby, pay any dividend or other payment with
          respect to the Pledged Collateral directly to the Administrative Agent

Section 5.4 Proceeds
to be Turned Over To Administrative Agent

Unless
otherwise expressly provided in the Credit Agreement, all Proceeds received by the
Administrative Agent hereunder in cash or Cash Equivalents shall be held by the
Administrative Agent in a Cash Collateral Account. All Proceeds while held by the
Administrative Agent in a Cash Collateral Account (or by such Grantor in trust for the
Administrative Agent) shall continue to be held as collateral security for the Secured
Obligations and shall not constitute payment thereof until applied as provided in the
Credit Agreement. Unless an Event of Default has occurred and is continuing or the release
thereof would constitute an Event of Default, all Proceeds held by the Administrative
Agent shall be released to the Grantors immediately upon request.

Section 5.5 Sale of
Collateral

(a)    
          Each Grantor recognizes that the Administrative Agent may be unable to effect a
          public sale of any Pledged Collateral by reason of certain prohibitions
          contained in the Securities Act or, with respect to Canadian Pledged Stock, the
          applicable Requirements of Law in Canada (the Canadian Securities
          Laws) and applicable state securities laws or otherwise or may
          determine that a public sale is impracticable or not commercially reasonable
          and, accordingly, may resort to one or more private sales thereof to a
          restricted group of purchasers that shall be obliged 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. Each Grantor acknowledges and
          agrees that any such private sale 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 been
          made in a commercially reasonable manner. The Administrative Agent shall be
          under no obligation to delay a sale of any Pledged Collateral for the period of
          time necessary to permit the issuer thereof to register such securities for
          public sale under the Securities Act or the Canadian Securities Laws, or under
          applicable state securities laws, even if such issuer would agree to do so.

(b)    
          Each Grantor agrees to use its best 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 Pledged Collateral pursuant to this Section 5.5valid and binding
          and in compliance with all other applicable Requirements of Law. Each Grantor
          further agrees that a breach of any covenant contained in this Section 5.5will cause irreparable injury to the Administrative Agent and other Secured
          Parties, that the Administrative 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 5.5 shall be
          specifically enforceable against such Grantor, and such Grantor hereby waives
          and agrees not to assert any defense against an action for specific performance
          of such covenants except for a defense that no Event of Default has occurred
          under the Credit Agreement.

Section 5.6
Deficiency

Each
Grantor shall remain liable for any deficiency if the proceeds of any sale or other
disposition of the Collateral are insufficient to pay the Secured Obligations and the fees
and disbursements of any attorney employed by the Administrative Agent or any other
Secured Party to collect such deficiency.

# ARTICLE VI  THE
ADMINISTRATIVE AGENT

Section 6.1
Administrative Agents Appointment as Attorney-in-Fact

|(a) | Each Grantor hereby irrevocably constitutes and appoints the Administrative
          Agent and any officer or agent thereof, with full power of substitution, as its
          true and lawful attorney-in-fact with full irrevocable power and authority in
          the place and stead of such Grantor and in the name of such Grantor or in its
          own name, for the purpose of carrying out the terms of this Agreement, to take
          any appropriate action and to execute any document or instrument that may be
          necessary or desirable to accomplish the purposes of this Agreement, and,
          without limiting the generality of the foregoing, each Grantor hereby gives the
          Administrative Agent the power and right, on behalf of such Grantor, without
          notice to or assent by such Grantor, to do any of the following:
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(i) | in the name of such Grantor or its own name, or otherwise, take possession of
          and indorse and collect any check, draft, note, acceptance or other instrument
          for the payment of moneys due under any Account or General Intangible or with
          respect to any other Collateral and file any claim or take any other action or
          proceeding in any court of law or equity or otherwise deemed appropriate by the
          Administrative Agent for the purpose of collecting any such moneys due under any
          Account or General Intangible or with respect to any other Collateral whenever
          payable;
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(ii) | in the case of any Intellectual Property, execute and deliver, and have
          recorded, any agreement, instrument, document or paper as the Administrative
          Agent may request to evidence the Administrative Agents security interest
          in such Intellectual Property and the goodwill and General Intangibles of such
          Grantor relating thereto or represented thereby;
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(iii) | pay or discharge taxes and Liens levied or placed on or threatened against the
          Collateral, effect any repair or pay any insurance called for by the terms of
          this Agreement (including all or any part of the premiums therefor and the costs
          thereof);
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(iv) | execute, in connection with any sale provided for in Section 5.1 (Code
          and Other Remedies) or Section 5.5 (Sale of Collateral), any
          endorsement, assignment or other instrument of conveyance or transfer with
          respect to the Collateral; or
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|(v) | (A) direct any party liable for any payment under any Collateral to make
          payment of any moneys due or to become due thereunder directly to the
          Administrative Agent or as the Administrative Agent shall direct, (B) ask
          or demand for, collect, and receive payment of and receipt for, any moneys,
          claims and other amounts due or to become due at any time in respect of or
          arising out of any Collateral, (C) sign and indorse any invoice, freight or
          express bill, bill of lading, storage or warehouse receipt, draft against
          debtors, assignment, verification, notice and other document in connection with
          any Collateral, (D) commence and prosecute any suit, action or proceeding
          at law or in equity in any court of competent jurisdiction to collect any
          Collateral and to enforce any other right in respect of any Collateral,
          (E) defend any suit, action or proceeding brought against such Grantor with
          respect to any Collateral, (F) settle, compromise or adjust any such suit,
          action or proceeding and, in connection therewith, give such discharges or
          releases as the Administrative Agent may deem appropriate, (G) assign any
          Copyright, Patent or Trademark (along with the goodwill of the business to which
          any such Trademark pertains) throughout the world for such term or terms, on
          such conditions, and in such manner as the Administrative Agent shall in its
          sole discretion determine, including the execution and filing of any document
          necessary to effectuate or record such assignment and (H) generally, sell,
          transfer, pledge and make any agreement with respect to or otherwise deal with
          any Collateral as fully and completely as though the Administrative Agent were
          the absolute owner thereof for all purposes, and do, at the Administrative
          Agents option and such Grantors expense, at any time, or from time
          to time, all acts and things that the Administrative Agent deems necessary to
          protect, preserve or realize upon the Collateral and the Administrative
          Agents and the other Secured Parties security interests therein and
          to effect the intent of this Agreement, all as fully and effectively as such
          Grantor might do.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Anything in this
clause (a) to the contrary notwithstanding, the Administrative Agent agrees
that it shall not exercise any right under the power of attorney provided for in this
clause (a) unless an Event of Default shall be continuing, and that if the
Administrative Agent does exercise any such right under such power of attorney, the
Administrative Agent shall exercise such right in a commercially reasonable manner to the
extent required to do so by the applicable Requirements of Law.

(b)    
          If any Grantor fails to perform or comply with any of its agreements contained
          herein, the Administrative Agent, at its option, but without any obligation so
          to do, may, in a commercially reasonable manner to the extent required to do so
          by the applicable Requirement of Law, perform or comply, or otherwise cause
          performance or compliance, with such agreement.

(c)    
          The expenses of the Administrative Agent incurred in connection with actions
          undertaken as provided in this Section 6.1, together with interest
          thereon at a rate per annum equal to the rate per annum at which interest would
          then be payable on past due Revolving Loans that are Base Rate Loans under the
          Credit Agreement, from the date of payment by the Administrative Agent to the
          date reimbursed by the relevant Grantor, shall be payable by such Grantor to the
          Administrative Agent on demand.

(d)    
          Each Grantor hereby ratifies all that said attorneys shall lawfully do or cause
          to be done by virtue hereof. All powers, authorizations and agencies contained
          in this Agreement are coupled with an interest and are irrevocable until this
          Agreement is terminated and the security interests created hereby are released.

Section 6.2 Duty of
Administrative Agent

The
Administrative Agents sole duty with respect to the custody, safekeeping and
physical preservation of the Collateral in its possession shall be to deal with it in the
same manner as the Administrative Agent deals with similar property for its own account.
Neither the Administrative Agent, any other Secured Party nor any of their respective
officers, directors, employees or agents shall be liable for failure to demand, collect or
realize upon any Collateral or for any delay in doing so or shall be under any obligation
to sell or otherwise dispose of any Collateral upon the request of any Grantor or any
other Person or to take any other action whatsoever with regard to any Collateral. The
powers conferred on the Administrative Agent hereunder are solely to protect the
Administrative Agents interest in the Collateral and shall not impose any duty upon
the Administrative Agent or any other Secured Party to exercise any such powers. The
Administrative Agent and the other Secured Parties shall be accountable only for amounts
that they actually receive as a result of the exercise of such powers, and neither they
nor any of their respective officers, directors, employees or agents shall be responsible
to any Grantor for any act or failure to act hereunder, except for their own gross
negligence or willful misconduct. The Administrative Agent acknowledges and agrees that it
shall not re-pledge or otherwise create a security interest in the Collateral,
provided, that the foregoing shall not prevent or preclude, in any respect, the
Administrative Agent or any Lender from assigning its rights under the Loan Documents in
accordance with Section 11.2(f) (Assignments and Participations) of the Credit
Agreement.

Section 6.3
Authorization of Financing Statements

Each
Grantor authorizes the Administrative Agent and its Affiliates, counsel and other
representatives, at any time and from time to time, to file or record financing
statements, amendments to financing statements, and other filing or recording documents or
instruments with respect to the Collateral without the signature of such Grantor in such
form and in such offices as the Administrative Agent reasonably determines appropriate to
perfect the security interests of the Administrative Agent under this Agreement, and such
financing statements and amendments may described the Collateral covered thereby as
all assets of the debtor, all personal property of the debtor or
words of similar effect. Each Grantor hereby also authorizes the Administrative Agent and
its Affiliates, counsel and other representatives, at any time and from time to time, to
file continuation statements with respect to previously filed financing statements.

Section 6.4
Authority of Administrative Agent

Each
Grantor acknowledges that the rights and responsibilities of the Administrative Agent
under this Agreement with respect to any action taken by the Administrative Agent or the
exercise or non-exercise by the Administrative Agent of any option, voting right, request,
judgment or other right or remedy provided for herein or resulting or arising out of this
Agreement shall, as between the Administrative Agent and the other Secured Parties, be
governed by the Credit Agreement and by such other agreements with respect thereto as may
exist from time to time among them, but, as between the Administrative Agent and the
Grantors, the Administrative Agent shall be conclusively presumed to be acting as agent
for the Administrative Agent and the other Secured Parties with full and valid authority
so to act or refrain from acting, and no Grantor shall be under any obligation, or
entitlement, to make any inquiry respecting such authority.

# ARTICLE VII  MISCELLANEOUS

Section 7.1
Amendments in Writing

None
of the terms or provisions of this Agreement may be waived, amended, supplemented or
otherwise modified except in accordance with Section 11.1 (Amendments, Waivers,
Etc.) of the Credit Agreement; provided, however, that annexes to this
Agreement may be supplemented (but no existing provisions may be modified and no
Collateral may be released) through Pledge Amendments and Joinder Agreements, in
substantially the form of Annex 3 (Form of Pledge Amendment) and
Annex 4 (Form of Joinder Agreement) respectively, in each case duly executed
by the Administrative Agent and each Grantor directly affected thereby.

Section 7.2 Notices

All
notices, requests and demands to or upon the Administrative Agent or any Grantor hereunder
shall be effected in the manner provided for in Section 11.8 (Notices, Etc.)of the Credit Agreement; provided, however, that any such notice,
request or demand to or upon any Grantor shall be addressed in case of the Borrower at the
Borrowers notice address set forth in such Section 11.8.

Section 7.3 No
Waiver by Course of Conduct; Cumulative Remedies

Neither
the Administrative Agent nor any other Secured Party shall by any act (except by a written
instrument pursuant to Section 7.1 (Amendments in Writing)), delay,
indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder
or to have acquiesced in any Default or Event of Default. No failure to exercise, nor any
delay in exercising, on the part of the Administrative Agent or any other Secured Party,
any right, power or privilege hereunder shall operate as a waiver thereof. No single or
partial exercise of any right, power or privilege hereunder shall preclude any other or
further exercise thereof or the exercise of any other right, power or privilege. A waiver
by the Administrative Agent or any other Secured Party of any right or remedy hereunder on
any one occasion shall not be construed as a bar to any right or remedy that the
Administrative Agent or such other Secured Party would otherwise have on any future
occasion. The rights and remedies herein provided are cumulative, may be exercised singly
or concurrently and are not exclusive of any other rights or remedies provided by law.

Section 7.4
Successors and Assigns

This
Agreement shall be binding upon the successors and assigns of each Grantor and shall inure
to the benefit of the Administrative Agent and each other Secured Party and their
successors and assigns; provided, however, that no Grantor may assign,
transfer or delegate any of its rights or obligations under this Agreement without the
prior written consent of the Administrative Agent.

Section 7.5
Counterparts

This
Agreement may be executed by one or more of the parties to this Agreement on any number of
separate counterparts (including by telecopy), each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one and the same
agreement. Signature pages may be detached from multiple counterparts and attached to a
single counterpart so that all signature pages are attached to the same document. Delivery
of an executed counterpart by telecopy shall be effective as delivery of a manually
executed counterpart.

Section 7.6
Severability

Any
provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

Section 7.7 Section
Headings

The
Article and Section titles contained in this Agreement are, and shall be, without
substantive meaning or content of any kind whatsoever and are not part of the agreement of
the parties hereto.

Section 7.8 Entire
Agreement

This
Agreement together with the other Loan Documents represents the entire agreement of the
parties and supersedes all prior agreements and understandings relating to the subject
matter hereof.

Section 7.9
Governing Law

This
Agreement and the rights and obligations of the parties hereto shall be governed by, and
construed and interpreted in accordance with, the law of the State of New York.

Section 7.10
Additional Grantors

If,
pursuant toSection 7.11 (Additional Collateral and Guaranties)of the Credit
Agreement, the Borrower shall be required to cause any Subsidiary that is not a Grantor to
become a Grantor hereunder, such Subsidiary shall execute and deliver to the
Administrative Agent a Joinder Agreement substantially in the form of Annex 4
(Form of Joinder Agreement) and shall thereafter for all purposes be a party hereto
and have the same rights, benefits and obligations as a Grantor party hereto on the
Closing Date.

Section 7.11 Release
of Collateral

(a)    
          At the time provided in Section 10.8(b)(i) (Concerning the
          Collateral and the Collateral Documents) of the Credit Agreement, the
          Collateral shall be released from the Lien created hereby and this Agreement and
          all obligations (other than those expressly stated to survive such termination)
          of the Administrative Agent and each Grantor hereunder shall terminate, all
          without delivery of any instrument or performance of any act by any party, and
          all rights to the Collateral shall revert to the Grantors. At the request and
          sole expense of any Grantor following any such termination, the Administrative
          Agent shall deliver to such Grantor any Collateral of such Grantor held by the
          Administrative Agent hereunder and execute and deliver to such Grantor such
          documents as such Grantor shall reasonably request to evidence such termination.

(b)    
          If the Administrative Agent shall be directed or permitted pursuant to
          Section 10.8(b)(ii)or (iii) (Concerning the Collateral
          and the Collateral Documents) of the Credit Agreement to release any Lien
          created hereby upon any Collateral (including any Collateral sold or disposed of
          by any Grantor in a transaction permitted by the Credit Agreement), such
          Collateral shall be released from the Lien created hereby to the extent provided
          under, and subject to the terms and conditions set forth in,
          Section 10.8(b)(ii)or (iii) (Concerning the Collateral
          and the Collateral Documents) of the Credit Agreement. In connection
          therewith, the Administrative Agent, at the request and sole expense of the
          Borrower, shall execute and deliver to the Borrower all releases or other
          documents reasonably necessary or desirable for the release of the Lien created
          hereby on such Collateral. At the request and sole expense of the Borrower, a
          Grantor shall be released from its obligations hereunder in the event that all
          the capital stock of such Grantor shall be so sold or disposed; provided,
          however, that the Borrower shall have delivered to the Administrative
          Agent, at least ten Business Days prior to the date of the proposed release, a
          written request for release identifying the relevant Grantor and the terms of
          the sale or other disposition in reasonable detail, including the price thereof
          and any expenses in connection therewith, together with a certification by the
          Borrower in form and substance satisfactory to the Administrative Agent stating
          that such transaction is in compliance with the Credit Agreement and the other
          Loan Documents.

Section 7.12
Reinstatement

Each
Grantor further agrees that, if any payment made by any Loan Party or other Person and
applied to the Obligations is at any time annulled, avoided, set aside, rescinded,
invalidated, declared to be fraudulent or preferential or otherwise required to be
refunded or repaid, or the proceeds of Collateral are required to be returned by any
Secured Party to such Loan Party, its estate, trustee, receiver or any other party,
including any Grantor, under any bankruptcy law, state or federal law, common law or
equitable cause, then, to the extent of such payment or repayment, any Lien or other
Collateral securing such liability shall be and remain in full force and effect, as fully
as if such payment had never been made or, if prior thereto the Lien granted hereby or
other Collateral securing such liability hereunder shall have been released or terminated
by virtue of such cancellation or surrender), such Lien or other Collateral shall be
reinstated in full force and effect, and such prior cancellation or surrender shall not
diminish, release, discharge, impair or otherwise affect any Lien or other Collateral
securing the obligations of any Grantor in respect of the amount of such payment.

[SIGNATURE PAGES FOLLOW]

---

IN
WITNESS WHEREOF, each of the undersigned has caused this Pledge and Security Agreement to
be duly executed and delivered as of the date first above written.

| |  | ALARIS MEDICAL SYSTEMS, INC.,
as Grantor
By: /s/ Stuart E. Rickerson
Name: Stuart E. RickersonTitle: Vice President, General Counsel & Secretary
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | ALARIS RELEASE CORPORATION,as Grantor
By: /s/ Stuart E. Rickerson
Name: Stuart E. RickersonTitle: Vice President, Treasurer & Secretary
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------

| |  | ALARIS CONSENT CORPORATION,as Grantor By: /s/ Stuart E. Rickerson
Name: Stuart E. RickersonTitle: Vice President, Treasurer & Secretary
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------

| |  | RIVER MEDICAL, INC,as Grantor By: /s/ David L. Schlotterbeck
 Name: David L. SchlotterbeckTitle: President & CEO
| |  | ------------------------------------------------------------------------------------------------------------------------------

| |  | IVAC OVERSEAS HOLDINGS, INC.,as Grantor By: /s/ Stuart E. Rickerson
Name: Stuart E. RickersonTitle: Secretary
| |  | ---------------------------------------------------------------------------------------------------------------------------

[SIGNATURE PAGE TO
PLEDGE AND SECURITY AGREEMENT]

|ACCEPTED AND AGREED
as of the date first above written: CITICORP NORTH AMERICA, INC.,as Administrative Agent By: /s/ Myles Kassin
Name: Myles Kassin
Title: Vice President |  | 
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | 

[SIGNATURE PAGE TO
PLEDGE AND SECURITY AGREEMENT]

---

|TABLE OF CONTENTS
|-----------------
|Article I        
|Section 1.1      
|Section 1.2      
|Article II       
|Section 2.1      
|Section 2.2      
|Section 2.3      
|Article III      
|Section 3.1      
|Section 3.2      
|Section 3.3      
|Section 3.4      
|Section 3.5      
|Section 3.6      
|Section 3.7      
|Section 3.8      
|Section 3.9      
|Article IV       
|Section 4.1      
|Section 4.2      
|Section 4.3      
|Section 4.4      
|Section 4.5      
|Section 4.6      
|Section 4.7      
|Section 4.8      
|Section 4.9      
|Section 4.10     
|Section 4.11     
|Section 4.12     
|Article V        
|Section 5.1      
|Section 5.2      
|Section 5.3      
|Section 5.4      
|Section 5.5      
|Section 5.6      
|Article VI       
|Section 6.1      
|Section 6.2      
|Section 6.3      
|Section 6.4      

---

|             |                                                     | Page
|------------ | --------------------------------------------------- | ----
|Article VII  | MISCELLANEOUS                                       | 29  
|Section 7.1  | Amendments in Writing                               | 29  
|Section 7.2  | Notices                                             | 29  
|Section 7.3  | No Waiver by Course of Conduct; Cumulative Remedies | 29  
|Section 7.4  | Successors and Assigns                              | 30  
|Section 7.5  | Counterparts                                        | 30  
|Section 7.6  | Severability                                        | 30  
|Section 7.7  | Section Headings                                    | 30  
|Section 7.8  | Entire Agreement                                    | 30  
|Section 7.9  | Governing Law                                       | 30  
|Section 7.10 | Additional Grantors                                 | 31  
|Section 7.11 | Release of Collateral                               | 31  
|Section 7.12 | Reinstatement                                       | 31  

---

|TABLE OF CONTENTS(continued)ANNEXES AND SCHEDULES | 
|------------------------------------------------- | 
|
|Annex 1                                           | 
|Annex 2                                           | 
|Annex 3                                           | 
|Annex 4                                           | 
|Annex 5                                           | 
|Annex 6A                                          | 
|Annex 7A                                          | 
|Schedule 1                                        | 
|Schedule 2                                        | 
|Schedule 3                                        | 
|Schedule 4                                        | 
|Schedule 5                                        | 
|Schedule 5A                                       | 
|Schedule 6                                        | 
|Schedule 7                                        |