**Exhibit 10.7****EXECUTION COPY****PLEDGE AND SECURITY AGREEMENT****dated as of March 26, 2007****between****EACH OF THE GRANTORS PARTY HERETO****and****WACHOVIA BANK, NATIONAL ASSOCIATION,****as Collateral Agent**
 

 
**TABLE OF CONTENTS**       PAGE SECTION 1. DEFINITIONS; GRANT OF SECURITY  1 **1.1**     **General Definitions**  1 **1.2**     **Definitions; Interpretation**  7      SECTION 2. GRANT OF SECURITY  8 **2.1**     **Grant of Security**  8 **2.2**     **Certain Limited Exclusions**  9      SECTION 3. SECURITY FOR OBLIGATIONS; GRANTORS REMAIN LIABLE  9 **3.1**     **Security for Obligations**  9 **3.2**     **Continuing Liability Under Collateral**  9      SECTION 4. REPRESENTATIONS AND WARRANTIES AND COVENANTS  10 **4.1**     Generally  10 **4.2**     **Equipment and Inventory**  13 **4.3**     **Receivables**  14 **4.4**     **Investment Related Property**  16 **4.5**     **Material Contracts**  22 **4.6**     **Letter of Credit Rights**  23 **4.7**     **Intellectual Property**  24 **4.8**     **Commercial Tort Claims**  27      SECTION 5. ACCESS; RIGHT OF INSPECTION AND FURTHER ASSURANCESADDITIONAL GRANTORS  27 **5.1**     **Access; Right of Inspection**  28 **5.2**     **Further Assurances**  28 **5.3**     **Additional Grantors**  29      SECTION 6. COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT  29 **6.1**     **Power of Attorney**  29 **6.2**     **No Duty on the Part of Collateral Agent or Secured Parties**  30      SECTION 7. REMEDIES  30 **7.1**     **Generally**  30 **7.2**     **Application of Proceeds**  32 **7.3**     **Sales on Credit**  32 **7.4**     **Deposit Accounts**  32 **7.5**     **Investment Related Property**  32 **7.6**     **Intellectual Property**  33 **7.7**     **Cash Proceeds**  35 **7.8**     **Acknowledgement**  35      SECTION 8. COLLATERAL AGENT  35      SECTION 9. CONTINUING SECURITY INTEREST; TRANSFER OF LOANS  36 
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       PAGE SECTION 10. STANDARD OF CARE; COLLATERAL AGENT MAY PERFORM  36      SECTION 11. MISCELLANEOUS  37      SCHEDULE 4.1 — GENERAL INFORMATION         SCHEDULE 4.2 — LOCATION OF EQUIPMENT AND INVENTORY         SCHEDULE 4.4 — INVESTMENT RELATED PROPERTY         SCHEDULE 4.5 — MATERIAL CONTRACTS         SCHEDULE 4.6 — DESCRIPTION OF LETTERS OF CREDIT         SCHEDULE 4.7 — INTELLECTUAL PROPERTY — EXCEPTIONS         SCHEDULE 4.8 — COMMERCIAL TORT CLAIMS         EXHIBIT A — PLEDGE SUPPLEMENT         EXHIBIT B — UNCERTIFICATED SECURITIES CONTROL AGREEMENT         EXHIBIT C — SECURITIES ACCOUNT CONTROL AGREEMENT         EXHIBIT D — DEPOSIT ACCOUNT CONTROL AGREEMENT         EXHIBIT E — TRADEMARK SECURITY AGREEMENT         EXHIBIT F — COPYRIGHT SECURITY AGREEMENT         EXHIBIT G — PATENT SECURITY AGREEMENT    
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          This **PLEDGE AND SECURITY AGREEMENT**, dated as of March 26, 2007 (this **“Agreement”**), between**EACH OF THE UNDERSIGNED**, whether as an original signatory hereto or as an Additional Grantor (asherein defined) (each, a **“Grantor”**), and Wachovia Bank, National Association (**“Wachovia Bank”**), ascollateral agent for the Secured Parties (as herein defined) (in such capacity as collateral agent,the **“Collateral Agent"**).**RECITALS:**     **WHEREAS**, reference is made to that certain Credit and Guaranty Agreement, dated as of the datehereof (as it may be amended, restated, supplemented or otherwise modified from time to time, the**“Credit Agreement”**), by and among **AMERIGROUP CORPORATION**(**“Company”**), a Delaware corporation, asBorrower, certain Subsidiaries of Company, as Guarantors, the lenders party thereto from time totime (the **“Lenders”**), **WACHOVIA CAPITAL MARKETS, LLC**, as joint lead arranger and joint bookrunner,**GOLDMAN SACHS CREDIT PARTNERS L.P.**, as joint lead arranger, joint bookrunner and syndication agent,and Wachovia Bank, as administrative agent and as collateral agent;     **WHEREAS**, subject to the terms and conditions of the Credit Agreement, certain Grantors mayenter into one or more Hedge Agreements with one or more Lender Counterparties;     **WHEREAS**, in consideration of the extensions of credit and other accommodations of Lenders andLender Counterparties as set forth in the Credit Agreement and the Hedge Agreements, respectively,each Grantor has agreed to secure such Grantor’s obligations under the Credit Documents and theHedge Agreements as set forth herein; and     **NOW, THEREFORE**, in consideration of the premises and the agreements, provisions and covenantsherein contained, each Grantor and the Collateral Agent agree as follows:**SECTION 1. DEFINITIONS; GRANT OF SECURITY.**     **1.1 General Definitions**. In this Agreement, the following terms shall have the followingmeanings:          **“Account Debtor”**shall mean each Person who is obligated on a Receivable or any SupportingObligation related thereto.          **“Accounts”**shall mean all “accounts” as defined in Article 9 of the UCC, including Health-CareInsurance Receivables.          **“Additional Grantors”**shall have the meaning assigned in Section 5.3.          **“Agreement”**shall have the meaning set forth in the preamble.          **“Assigned Agreements”**shall mean all agreements and contracts to which such Grantor is a partyas of the date hereof, or to which such Grantor becomes a party after the date hereof, including,without limitation, each Material Contract, as each such agreement may be amended, supplemented orotherwise modified from time to time.          **“Bankruptcy Code”**shall mean Title 11 of the United States Code entitled “Bankruptcy”, as nowand hereafter in effect, or any successor statute.
 

 
          **“Cash Proceeds”**shall have the meaning assigned in Section 7.7.          **“Chattel Paper”**shall mean all “chattel paper” as defined in Article 9 of the UCC, including,without limitation, “electronic chattel paper” or “tangible chattel paper”, as each term is definedin Article 9 of the UCC.          **“Collateral”**shall have the meaning assigned in Section 2.1.          **“Collateral Account”**shall mean any account established by the Collateral Agent.          **“Collateral Agent”**shall have the meaning set forth in the preamble.          **“Collateral Records”**shall mean books, records, ledger cards, files, correspondence, customerlists, blueprints, technical specifications, manuals, computer software, computer printouts, tapes,disks and related data processing software and similar items that at any time evidence or containinformation relating to any of the Collateral or are otherwise necessary or helpful in thecollection thereof or realization thereupon.          **“Collateral Support”**shall mean all property (real or personal) assigned, hypothecated orotherwise securing any Collateral and shall include any security agreement or other agreementgranting a lien or security interest in such real or personal property.          **“Commercial Tort Claims”**shall mean all “commercial tort claims” as defined in Article 9 ofthe UCC, including, without limitation, all commercial tort claims listed on Schedule 4.8 (as suchschedule may be amended or supplemented from time to time).          **“Commodities Accounts”**(i) shall mean all “commodity accounts” as defined in Article 9 of theUCC and (ii) shall include, without limitation, all of the accounts listed on Schedule 4.4 underthe heading “Commodities Accounts” (as such schedule may be amended or supplemented from time totime).          **“Company”**shall have the meaning set forth in the recitals.          **“Controlled Foreign Corporation”**shall mean “controlled foreign corporation” as defined in theTax Code.          **“Copyright Licenses”**shall mean any and all agreements providing for the granting of any rightin or to Copyrights (whether such Grantor is licensee or licensor thereunder) including, withoutlimitation, each agreement referred to in Schedule 4.7(B) (as such schedule may be amended orsupplemented from time to time).          **“Copyrights”**shall mean all United States, and foreign copyrights (including Communitydesigns), including but not limited to copyrights in software and databases, and all Mask Works (asdefined under 17 U.S.C. 901 of the U.S. Copyright Act), whether registered or unregistered, and,with respect to any and all of the foregoing: (i) all registrations and applications thereforincluding, without limitation, the registrations and applications referred to in Schedule 4.7(A)(as such schedule may be amended or supplemented from time to time), (ii) all extensions andrenewals thereof, (iii) all rights corresponding thereto throughout the world, (iv) all rights tosue for past, present and future infringements thereof, and (v) all Proceeds of the
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foregoing, including, without limitation, licenses, royalties, income, payments, claims,damages and proceeds of suit.          **“Credit Agreement”**shall have the meaning set forth in the recitals.          **“Deposit Accounts”**(i) shall mean all “deposit accounts” as defined in Article 9 of the UCCand (ii) shall include, without limitation, all of the accounts listed on Schedule 4.4 under theheading “Deposit Accounts” (as such schedule may be amended or supplemented from time to time).          **“Documents”**shall mean all “documents” as defined in Article 9 of the UCC.          **“Equipment”**shall mean: (i) all “equipment” as defined in Article 9 of the UCC, (ii) allmachinery, manufacturing equipment, data processing equipment, computers, office equipment,furnishings, furniture, appliances, fixtures and tools (in each case, regardless of whethercharacterized as equipment under the UCC) and (iii) all accessions or additions thereto, all partsthereof, whether or not at any time of determination incorporated or installed therein or attachedthereto, and all replacements therefor, wherever located, now or hereafter existing, including anyfixtures.          **“ERISA”**means the Employee Retirement Income Security Act of 1974, as amended from time totime, and any successor thereto.          **“General Intangibles”**(i) shall mean all “general intangibles” as defined in Article 9 of theUCC, including “payment intangibles” also as defined in Article 9 of the UCC and (ii) shallinclude, without limitation, all interest rate or currency protection or hedging arrangements, alltax refunds, all licenses, permits, concessions and authorizations, all Assigned Agreements and allIntellectual Property (in each case, regardless of whether characterized as general intangiblesunder the UCC).          **“Goods”**(i) shall mean all “goods” as defined in Article 9 of the UCC and (ii) shall include,without limitation, all Inventory and Equipment (in each case, regardless of whether characterizedas goods under the UCC).          **“Grantors”**shall have the meaning set forth in the preamble.          **“Health-Care Insurance Receivable”**shall mean all “health-care-insurance receivable” asdefined in Article 9 of the UCC.          **“Indemnitee”**shall mean the Collateral Agent, and its and its Affiliates’ officers, partners,directors, trustees, employees, agents.          **“Instruments”**shall mean all “instruments” as defined in Article 9 of the UCC.          **“Insurance”**shall mean (i) all insurance policies covering any or all of the Collateral(regardless of whether the Collateral Agent is the loss payee thereof) and (ii) any key man lifeinsurance policies.          **“Intellectual Property”**shall mean, collectively, the Copyrights, the Copyright Licenses, thePatents, the Patent Licenses, the Trademarks, the Trademark Licenses, the Trade Secrets, and theTrade Secret Licenses.
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          **“Inventory”**shall mean (i) all “inventory” as defined in Article 9 of the UCC and (ii) allgoods held for sale or lease or to be furnished under contracts of service or so leased orfurnished, all raw materials, work in process, finished goods, and materials used or consumed inthe manufacture, packing, shipping, advertising, selling, leasing, furnishing or production of suchinventory or otherwise used or consumed in any Grantor’s business; all goods in which any Grantorhas an interest in mass or a joint or other interest or right of any kind; and all goods which arereturned to or repossessed by any Grantor, all computer programs embedded in any goods and allaccessions thereto and products thereof (in each case, regardless of whether characterized asinventory under the UCC).          **“Investment Accounts”**shall mean the Collateral Account, Securities Accounts, CommoditiesAccounts and Deposit Accounts.          **“Investment Related Property”**shall mean: (i) all “investment property” (as such term isdefined in Article 9 of the UCC) and (ii) all of the following (regardless of whether classified asinvestment property under the UCC): all Pledged Equity Interests, Pledged Debt, the InvestmentAccounts and certificates of deposit.          **“Lender”**shall have the meaning set forth in the recitals.          **“Letter of Credit Right”**shall mean “letter-of-credit right” as defined in Article 9 of theUCC.          **“Lien”**shall mean (i) any lien, mortgage, pledge, assignment, security interest, charge orencumbrance of any kind (including any agreement to give any of the foregoing, any conditional saleor other title retention agreement, and any lease in the nature thereof) and any option, trust orother preferential arrangement having the practical effect of any of the foregoing and (ii) in thecase of Pledged Equity Interests, any purchase option, call or similar right of a third party withrespect to such Pledged Equity Interests.          **“Money”**shall mean “money” as defined in the UCC.          **“Non-Assignable Contract”**shall mean any agreement, contract or license to which any Grantoris a party that by its terms purports to restrict or prevent the assignment or granting of asecurity interest therein (either by its terms or by any federal or state statutory prohibition orotherwise irrespective of whether such prohibition or restriction is enforceable under Section9-406 through 409 of the UCC).          **“Patent Licenses”**shall mean all agreements providing for the granting of any right in or toPatents (whether such Grantor is licensee or licensor thereunder) including, without limitation,each agreement referred to in Schedule 4.7(D) (as such schedule may be amended or supplemented fromtime to time).          **“Patents”**shall mean all United States and foreign patents and certificates of invention, orsimilar industrial property rights, and applications for any of the foregoing, including, but notlimited to: (i) each patent and patent application referred to in Schedule 4.7(C) hereto (as suchschedule may be amended or supplemented from time to time), (ii) all reissues, divisions,continuations, continuations-in-part, extensions, renewals, and reexaminations thereof, (iii) allrights corresponding thereto throughout the world, (iv) all inventions and improvements describedtherein, (v) all rights to sue for past, present and future infringements thereof, (vi) alllicenses, claims, damages, and proceeds of suit arising therefrom, and (vii) all Proceeds of the
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foregoing, including, without limitation, licenses, royalties, income, payments, claims,damages, and proceeds of suit.          **“Pledge Supplement”**shall mean any supplement to this agreement in substantially the form ofExhibit A.          **“Pledged Debt”**shall mean all Indebtedness owed to such Grantor, including, withoutlimitation, all Indebtedness described on Schedule 4.4(A) under the heading “Pledged Debt” (as suchschedule may be amended or supplemented from time to time), issued by the obligors named therein,the instruments evidencing such Indebtedness, and all interest, cash, instruments and otherproperty or proceeds from time to time received, receivable or otherwise distributed in respect ofor in exchange for any or all of such Indebtedness.          **“Pledged Equity Interests”**shall mean all Pledged Stock, Pledged LLC Interests, PledgedPartnership Interests and Pledged Trust Interests.          **“Pledged LLC Interests”**shall mean all limited liability company interests listed on Schedule4.4(A) under the heading “Pledged LLC Interests” (as such schedule may be amended or supplementedfrom time to time) and the certificates, if any, representing such limited liability companyinterests and any interest of such Grantor on the books and records of such limited liabilitycompany or on the books and records of any securities intermediary pertaining to such interest andall dividends, distributions, cash, warrants, rights, options, instruments, securities and otherproperty or proceeds from time to time received, receivable or otherwise distributed in respect ofor in exchange for any or all of such limited liability company interests.          **“Pledged Partnership Interests”**shall mean all interests in any general partnership, limitedpartnership, limited liability partnership or other partnership listed on Schedule 4.4(A) under theheading “Pledged Partnership Interests” (as such schedule may be amended or supplemented from timeto time) and the certificates, if any, representing such partnership interests and any interest ofsuch Grantor on the books and records of such partnership or on the books and records of anysecurities intermediary pertaining to such interest and all dividends, distributions, cash,warrants, rights, options, instruments, securities and other property or proceeds from time to timereceived, receivable or otherwise distributed in respect of or in exchange for any or all of suchpartnership interests.          **“Pledged Stock”**shall mean all shares of capital stock owned by such Grantor described onSchedule 4.4(A) under the heading “Pledged Stock” (as such schedule may be amended or supplementedfrom time to time), and the certificates, if any, representing such shares and any interest of suchGrantor in the entries on the books of the issuer of such shares or on the books of any securitiesintermediary pertaining to such shares, and all dividends, distributions, cash, warrants, rights,options, instruments, securities and other property or proceeds from time to time received,receivable or otherwise distributed in respect of or in exchange for any or all of such shares.          **“Pledged Trust Interests”**shall mean all interests in a Delaware business trust or other trustincluding, without limitation, all trust interests listed on Schedule 4.4(A) under the heading“Pledged Trust Interests” (as such schedule may be amended or supplemented from time to time) andthe certificates, if any, representing such trust interests and any interest of such Grantor on thebooks and records of such trust or on the books and records of any securities intermediarypertaining to such interest and all dividends, distributions, cash, warrants, rights,
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options, instruments, securities and other property or proceeds from time to time received,receivable or otherwise distributed in respect of or in exchange for any or all of such trustinterests.          **“Proceeds”**shall mean: (i) all “proceeds” as defined in Article 9 of the UCC, (ii) paymentsor distributions made with respect to any Investment Related Property and (iii) whatever isreceivable or received when Collateral or proceeds are sold, exchanged, collected or otherwisedisposed of, whether such disposition is voluntary or involuntary.          **“Receivables”**shall mean all rights to payment, whether or not earned by performance, forgoods or other property sold, leased, licensed, assigned or otherwise disposed of, or servicesrendered or to be rendered, including, without limitation all such rights constituting or evidencedby any Account, Chattel Paper, Instrument, General Intangible or Investment Related Property,together with all of Grantor’s rights, if any, in any goods or other property giving rise to suchright to payment and all Collateral Support and Supporting Obligations related thereto and allReceivables Records.          **“Receivables Records”**shall mean (i) all original copies of all documents, instruments orother writings or electronic records or other Records evidencing the Receivables, (ii) all books,correspondence, credit or other files, Records, ledger sheets or cards, invoices, and other papersrelating to Receivables, including, without limitation, all tapes, cards, computer tapes, computerdiscs, computer runs, record keeping systems and other papers and documents relating to theReceivables, whether in the possession or under the control of Grantor or any computer bureau oragent from time to time acting for Grantor or otherwise, (iii) all evidences of the filing offinancing statements and the registration of other instruments in connection therewith, andamendments, supplements or other modifications thereto, notices to other creditors or securedparties, and certificates, acknowledgments, or other writings, including, without limitation, liensearch reports, from filing or other registration officers, (iv) all credit information, reportsand memoranda relating thereto and (v) all other written or nonwritten forms of information relatedin any way to the foregoing or any Receivable.          **“Record”**shall have the meaning specified in Article 9 of the UCC.          **“Secured Obligations”**shall have the meaning assigned in Section 3.1.          **“Secured Parties”**shall mean the Agents, Lenders and the Lender Counterparties and shallinclude, without limitation, all former Agents, Lenders and Lender Counterparties to the extentthat any Obligations owing to such Persons were incurred while such Persons were Agents, Lenders orLender Counterparties and such Obligations have not been paid or satisfied in full.          **“Securities”**shall mean any stock, shares, partnership interests, voting trust certificates,certificates of interest or participation in any profit-sharing agreement or arrangement, options,warrants, bonds, debentures, notes, or other evidences of indebtedness, secured or unsecured,convertible, subordinated or otherwise, or in general any instruments commonly known as“securities” or any certificates of interest, shares or participations in temporary or interimcertificates for the purchase or acquisition of, or any right to subscribe to, purchase or acquire,any of the foregoing.          **“Securities Accounts”**(i) shall mean all “securities accounts” as defined in Article 8 of theUCC and (ii) shall include, without limitation, all of the accounts listed on
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Schedule 4.4(A) under the heading “Securities Accounts” (as such schedule may be amended orsupplemented from time to time).          **“Supporting Obligation”**shall mean all “supporting obligations” as defined in Article 9 of theUCC.          **“Tax Code”**shall mean the United States Internal Revenue Code of 1986, as amended from time totime.          **“Trademark Licenses”**shall mean any and all agreements providing for the granting of any rightin or to Trademarks (whether such Grantor is licensee or licensor thereunder) including, withoutlimitation, each agreement referred to in Schedule 4.7(F) (as such schedule may be amended orsupplemented from time to time).          **“Trademarks”**shall mean all United States, and foreign trademarks, trade names, fictitiousbusiness names, Internet domain names, service marks, certification marks, collective marks, logos,other source or business identifiers, designs and general intangibles of a like nature, allregistrations and applications for any of the foregoing including, but not limited to: (i) theregistrations and applications referred to in Schedule 4.7(E) (as such schedule may be amended orsupplemented from time to time), (ii) all extensions or renewals of any of the foregoing, (iii) allof the goodwill of the business connected with the use of and symbolized by the foregoing, (iv) theright to sue for past, present and future infringement or dilution of any of the foregoing or forany injury to goodwill, and (v) all Proceeds of the foregoing, including, without limitation,licenses, royalties, income, payments, claims, damages, and proceeds of suit.          **“Trade Secret Licenses”**shall mean any and all agreements providing for the granting of anyright in or to Trade Secrets (whether such Grantor is licensee or licensor thereunder) including,without limitation, each agreement referred to in Schedule 4.7(G) (as such schedule may be amendedor supplemented from time to time).          **“Trade Secrets”**shall mean all trade secrets and all other confidential or proprietaryinformation and know-how whether or not such Trade Secret has been reduced to a writing or othertangible form, including all documents and things embodying, incorporating, or referring in any wayto such Trade Secret, including but not limited to: (i) the right to sue for past, present andfuture misappropriation or other violation of any Trade Secret, and (ii) all Proceeds of theforegoing, including, without limitation, licenses, royalties, income, payments, claims, damages,and proceeds of suit.          **“UCC”**shall mean the Uniform Commercial Code as in effect from time to time in the State ofNew York or, when the context implies, the Uniform Commercial Code as in effect from time to timein any other applicable jurisdiction.          **“United States”**shall mean the United States of America.     **1.2 Definitions; Interpretation**. All capitalized terms used herein (including the preambleand recitals hereto) and not otherwise defined herein shall have the meanings ascribed thereto inthe Credit Agreement or, if not defined therein, in the UCC. References to “Sections,” “Exhibits”and “Schedules” shall be to Sections, Exhibits and Schedules, as the case may be, of this Agreementunless otherwise specifically provided. Section headings in this Agreement are included herein forconvenience of reference only and shall not constitute a part of this Agreement for any other purpose or begiven any substantive effect. Any of the terms defined
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herein may, unless the context otherwiserequires, be used in the singular or the plural, depending on the reference. The use herein of theword “include” or “including”, when following any general statement, term or matter, shall not beconstrued to limit such statement, term or matter to the specific items or matters set forthimmediately following such word or to similar items or matters, whether or not nonlimiting language(such as “without limitation” or “but not limited to” or words of similar import) is used withreference thereto, but rather shall be deemed to refer to all other items or matters that fallwithin the broadest possible scope of such general statement, term or matter. If any conflict orinconsistency exists between this Agreement and the Credit Agreement, the Credit Agreement shallgovern. All references herein to provisions of the UCC shall include all successor provisionsunder any subsequent version or amendment to any Article of the UCC.**SECTION 2. GRANT OF SECURITY.**     **2.1 Grant of Security**. Each Grantor hereby grants to the Collateral Agent a security interestin and continuing lien on all of such Grantor’s right, title and interest in, to and under allpersonal property of such Grantor including, but not limited to the following, in each case whethernow owned or existing or hereafter acquired or arising and wherever located (all of which beinghereinafter collectively referred to as the **“Collateral”**):          (a) Accounts;          (b) Chattel Paper;          (c) Documents;          (d) General Intangibles;          (e) Goods;          (f) Instruments;          (g) Insurance;          (h) Intellectual Property;          (i) Investment Related Property;          (j) Letter of Credit Rights;          (k) Money;          (l) Receivables and Receivable Records;          (m) Commercial Tort Claims;          (n) all Collateral Records, Collateral Support and Supporting Obligations relating to any ofthe foregoing; and          (o) all Proceeds, products, accessions, rents and profits of or in respect of any of theforegoing.
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     **2.2 Certain Limited Exclusions**. Notwithstanding anything herein to the contrary, in no eventshall the Collateral include or the security interest granted under Section 2.1 hereof attach to(a) any lease, license, contract, property rights or agreement to which any Grantor is a party orany of its rights or interests thereunder if and for so long as the grant of such security interestshall constitute or result in (i) the abandonment, invalidation or unenforceability of any right,title or interest of any Grantor therein or (ii) in a breach or termination pursuant to the termsof, or a default under, any such lease, license, contract property rights or agreement (other thanto the extent that any such term would be rendered ineffective pursuant to Sections 9-406, 9-407,9-408 or 9-409 of the UCC (or any successor provision or provisions) of any relevant jurisdictionor any other applicable law (including the Bankruptcy Code) or principles of equity), providedhowever that the Collateral shall include and such security interest shall attach immediately atsuch time as the condition causing such abandonment, invalidation or unenforceability shall beremedied and to the extent severable, shall attach immediately to any portion of such Lease,license, contract, property rights or agreement that does not result in any of the consequencesspecified in (i) or (ii) above; (b) any of the outstanding capital stock of a Controlled ForeignCorporation in excess of 65% of the voting power of all classes of capital stock of such ControlledForeign Corporation entitled to vote; provided that immediately upon the amendment of the Tax Codeto allow the pledge of a greater percentage of the voting power of capital stock in a ControlledForeign Corporation without adverse tax consequences, the Collateral shall include, and thesecurity interest granted by each Grantor shall attach to, such greater percentage of capital stockof each Controlled Foreign Corporation; (c) any trademark applications filed in the United StatesPatent and Trademark Office on the basis of any Grantor’s “intent-to-use” such trademark pursuantto 15 U.S.C. 1051 Section 1(b), unless and until evidence of use of the Trademark has been filedwith the United States Patent and Trademark Office pursuant to Section 1(c) or Section 1(d) of theLanham Act (15 U.S.C. 1051, et seq.); or (d) cash collateral in an amount not to exceed $50,433,600solely to the extent held by Bank of America, N.A. for the purpose of cash collateralizingoutstanding letter of credit #3085765; provided, that upon the release of such cash collateral tothe Grantors and their Subsidiaries, such cash collateral shall constitute Collateral hereunder andthe security interest granted under Section 2.1 hereof shall attach thereto.**SECTION 3. SECURITY FOR OBLIGATIONS; GRANTORS REMAIN LIABLE.**     **3.1 Security for Obligations**. This Agreement secures, and the Collateral is collateralsecurity for, the prompt and complete payment or performance in full when due, whether at statedmaturity, by required prepayment, declaration, acceleration, demand or otherwise (including thepayment of amounts that would become due but for the operation of the automatic stay under Section362(a) of the Bankruptcy Code, 11 U.S.C. §362(a) (and any successor provision thereof)), of allObligations with respect to every Grantor (the **“Secured Obligations”**).     **3.2 Continuing Liability Under Collateral**. Notwithstanding anything herein to the contrary,(i) each Grantor shall remain liable for all obligations under the Collateral and nothing containedherein is intended or shall be a delegation of duties to the Collateral Agent or any Secured Party,(ii) each Grantor shall remain liable under each of the agreements included in the Collateral, including, without limitation,any agreements relating to Pledged Partnership Interests or Pledged LLC Interests, to perform allof the obligations undertaken by it thereunder all in accordance with and pursuant to the terms andprovisions thereof and neither the Collateral Agent nor any Secured Party shall have any obligationor liability under any of such agreements by reason of or arising out of this Agreement or anyother document related thereto nor shall the Collateral Agent nor any Secured Party have anyobligation to make any inquiry as to the nature or sufficiency of any payment received by it orhave any obligation to take any action to collect or
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enforce any rights under any agreementincluded in the Collateral, including, without limitation, any agreements relating to PledgedPartnership Interests or Pledged LLC Interests, and (iii) the exercise by the Collateral Agent ofany of its rights hereunder shall not release any Grantor from any of its duties or obligationsunder the contracts and agreements included in the Collateral.**SECTION 4. REPRESENTATIONS AND WARRANTIES AND COVENANTS.**     **4.1**Generally.          (a) Representations and Warranties. Each Grantor hereby represents and warrants, onthe Closing Date and on each Credit Date, that:          (i) it owns the Collateral purported to be owned by it or otherwise has the rights itpurports to have in each item of Collateral and, as to all Collateral whether now existingor hereafter acquired, will continue to own or have such rights in each item of theCollateral, in each case free and clear of any and all Liens, rights or claims of all otherPersons, including, without limitation, liens arising as a result of such Grantor becomingbound (as a result of merger or otherwise) as debtor under a security agreement enteredinto by another Person, other than Permitted Liens;          (ii) it has indicated on Schedule 4.1(A)(as such schedule may be amended orsupplemented from time to time): (w) the type of organization of such Grantor, (x) thejurisdiction of organization of such Grantor, (y) its organizational identification numberand (z) the jurisdiction where the chief executive office or its sole place of business is(or the principal residence if such Grantor is a natural person), and for the one-yearperiod preceding the date hereof has been, located.          (iii) the full legal name of such Grantor is as set forth on Schedule 4.1(A) and ithas not done in the last five (5) years, and does not do, business under any other name(including any trade name or fictitious business name) except for those names set forth onSchedule 4.1(B) (as such schedule may be amended or supplemented from time to time);          (iv) except as provided on Schedule 4.1(C), it has not changed its name, jurisdictionof organization, chief executive office or sole place of business (or principal residenceif such Grantor is a natural person) or its corporate structure in any way (e.g., bymerger, consolidation, change in corporate form or otherwise) within the past five (5)years;          (v) it has not within the last five (5) years become bound (whether as a result ofmerger or otherwise) as debtor under a security agreement entered into by another Person,which has not heretofore been terminated other than theagreements identified on Schedule 4.1(D) hereof (as such schedule may be amended orsupplemented from time to time);          (vi) with respect to each agreement identified on Schedule 4.1(D), it has indicated onSchedule 4.1 (A) and Schedule 4.1(B) the information required pursuant to Section4.1(a)(ii), (iii) and (iv) with respect to the debtor under each such agreement;
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          (vii) (u) upon the filing of all UCC financing statements naming each Grantor as“debtor” and the Collateral Agent as “secured party” and describing the Collateral in thefiling offices set forth opposite such Grantor’s name on Schedule 4.1(E) hereof (as suchschedule may be amended or supplemented from time to time) and other filings delivered byeach Grantor, (v) upon delivery of all Instruments, Chattel Paper and certificated PledgedEquity Interests and Pledged Debt, (w) upon sufficient identification of Commercial TortClaims, (x) upon execution of a control agreement establishing the Collateral Agent’s“control” (within the meaning of Section 8-106, 9-106 or 9-104 of the UCC, as applicable)with respect to any Investment Account, (y) upon consent of the issuer with respect toLetter of Credit Rights, and (z) to the extent not subject to Article 9 of the UCC, uponrecordation of the security interests granted hereunder in Patents, Trademarks andCopyrights in the applicable intellectual property registries, including but not limited tothe United States Patent and Trademark Office and the United States Copyright Office, thesecurity interests granted to the Collateral Agent hereunder constitute valid and perfectedFirst Priority Liens (subject in the case of priority only to Permitted Liens and to therights of the United States government (including any agency or department thereof) withrespect to United States government Receivables) on all of the Collateral; provided,however, that additional filings in the United States Patent and Trademark Office andUnited States Copyright Office may be necessary with respect to the perfection of theCollateral Agent’s Lien in United States registrations and applications for Trademarks,Patents and Copyrights which are filed by, issued to, or acquired by a Grantor after thedate hereof and, provided, further, that additional filings and/or other actions may berequired to perfect the Collateral Agent’s Lien in Intellectual Property Collateral whichis created under the laws of a jurisdiction outside the United States;          (viii) all actions and consents, including all filings, notices, registrations andrecordings necessary or desirable for the exercise by the Collateral Agent of the voting orother rights provided for in this Agreement or the exercise of remedies in respect of theCollateral have been made or obtained, subject to Section 7.8, if applicable;          (ix) other than the financing statements filed in favor of the Collateral Agent, noeffective UCC financing statement, fixture filing or other instrument similar in effectunder any applicable law covering all or any part of the Collateral is on file in anyfiling or recording office except for (x) financing statements for which proper terminationstatements have been delivered to the Collateral Agent for filing and (y) financingstatements filed in connection with Permitted Liens;          (x) subject to Section 7.8, if applicable, and other than as has been obtained ormade, no authorization, approval or other action by, and no notice to or filing with, anyGovernmental Authority or regulatory body is required for either (i) the pledge or grant byany Grantor of the Liens purported to be created in favor of the Collateral Agent hereunder or (ii) the exercise by Collateral Agent of any rights orremedies in respect of any Collateral (whether specifically granted or created hereunder orcreated or provided for by applicable law), except (A) for the filings contemplated byclause (vii) above and (B) as may be required, in connection with the disposition of anyInvestment Related Property, by laws generally affecting the offering and sale ofSecurities;
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          (xi) all information supplied by any Grantor with respect to any of the Collateral (ineach case taken as a whole with respect to any particular Collateral) is accurate andcomplete in all material respects;          (xii) none of the Collateral constitutes, or is the Proceeds of, “farm products” (asdefined in the UCC);          (xiii) it does not own any “as extracted collateral” (as defined in the UCC) or anytimber to be cut;          (xiv) Except as described on Schedule 4.1(D), such Grantor has not become bound as adebtor, either by contract or by operation of law, by a security agreement previouslyentered into by another Person; and          (xv) Such Grantor has been duly organized as an entity of the type as set forthopposite such Grantor’s name on Schedule 4.1(A) solely under the laws of the jurisdictionas set forth opposite such Grantor’s name on Schedule 4.1(A) and remains duly existing assuch. Such Grantor has not filed any certificates of domestication, transfer orcontinuance in any other jurisdiction.          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees that:          (i) except for the security interest created by this Agreement, it shall not create orsuffer to exist any Lien upon or with respect to any of the Collateral, except PermittedLiens, and such Grantor shall defend the Collateral against all Persons at any timeclaiming any interest therein;          (ii) it shall not produce, use or permit any Collateral to be used unlawfully or inviolation of any provision of this Agreement or any applicable statute, regulation orordinance or any policy of insurance covering the Collateral;          (iii) it shall not change such Grantor’s name, identity, corporate structure (e.g., bymerger, consolidation, change in corporate form or otherwise) sole place of business (orprincipal residence if such Grantor is a natural person), chief executive office, type oforganization or jurisdiction of organization unless it shall have (a) notified theCollateral Agent in writing, by executing and delivering to the Collateral Agent acompleted Pledge Supplement, substantially in the form of Exhibit A attached hereto,together with all Supplements to Schedules thereto, at least twenty (20) days prior to anysuch change or establishment, identifying such new proposed name, identity, corporatestructure, sole place of business (or principal residence if such Grantor is a naturalperson), chief executive office, jurisdiction of organization or trade name and providingsuch other information in connection therewith as the Collateral Agent may reasonablyrequest and (b) taken all actions necessary or advisable to maintain the continuous validity, perfection and the same or better priority of the CollateralAgent’s security interest in the Collateral intended to be granted and agreed to hereby;          (iv) if the Collateral Agent or any Secured Party gives value to enable Grantor toacquire rights in or the use of any Collateral, it shall use such value for such purposes;
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          (v) [Reserved];          (vi) upon such Grantor or any officer of such Grantor obtaining knowledge thereof, itshall promptly notify the Collateral Agent in writing of any event that may have a MaterialAdverse Effect on the value of the Collateral or any portion thereof, the ability of anyGrantor or the Collateral Agent to dispose of the Collateral or any portion thereof, or therights and remedies of the Collateral Agent in relation thereto, including, withoutlimitation, the levy of any legal process against the Collateral or any portion thereof;          (vii) it shall not take or permit any action, other than as permitted under the CreditAgreement, which would reasonably be expected to materially impair the Collateral Agent’srights in the Collateral; and          (viii) it shall not sell, transfer or assign (by operation of law or otherwise) anyCollateral except as otherwise in accordance with the Credit Agreement.     **4.2 Equipment and Inventory.**          (a) Representations and Warranties. Each Grantor represents and warrants, on theClosing Date and on each Credit Date, that:          (i) substantially all of the Equipment and Inventory, including all of the materialEquipment and Inventory, included in the Collateral is kept only at the locations specifiedin Schedule 4.2 (as such schedule may be amended or supplemented from time to time);          (ii) any Goods now or hereafter produced by any Grantor included in the Collateralhave been and will be produced in compliance with the requirements of the Fair LaborStandards Act, as amended; and          (iii) none of the Inventory or Equipment is in the possession of an issuer of anegotiable document (as defined in Section 7-104 of the UCC) therefor or otherwise in thepossession of a bailee or a warehouseman.          (b) Covenants and Agreements. Each Grantor covenants and agrees that:          (i) it shall keep the Equipment, Inventory and any Documents evidencing any suchEquipment and Inventory in the locations specified on Schedule 4.2 (as such schedule may beamended or supplemented from time to time) unless it shall have (a) promptly notified theCollateral Agent in writing, by executing and delivering to the Collateral Agent acompleted Pledge Supplement, substantially in the form of ExhibitA attached hereto, together with all Supplements to Schedules thereto, identifyingsuch new locations and providing such other information in connection therewith as theCollateral Agent may reasonably request and (b) taken all actions necessary or advisable tomaintain the continuous validity, perfection and the same or better priority of theCollateral Agent’s security interest in the Collateral intended to be granted and agreed tohereby, or to enable the Collateral Agent to exercise and enforce its rights and remedieshereunder, with respect to such Equipment and Inventory;
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          (ii) it shall keep correct and accurate records of the Inventory, as is customarilymaintained under similar circumstances by Persons of established reputation engaged insimilar business, and in any event in conformity with GAAP;          (iii) it shall not deliver any Document evidencing any Equipment and Inventory to anyPerson other than the issuer of such Document to claim the Goods evidenced therefor or theCollateral Agent;          (iv) if any Equipment or Inventory is in possession or control of any third party,each Grantor shall join with the Collateral Agent in notifying the third party of theCollateral Agent’s security interest and use commercially reasonable efforts to obtain anacknowledgment from the third party that it is holding the Equipment and Inventory for thebenefit of the Collateral Agent; and          (v) with respect to any item of Equipment which is covered by a certificate of titleunder a statute of any jurisdiction under the law of which indication of a securityinterest on such certificate is required as a condition of perfection thereof, upon thereasonable request of the Collateral Agent, (A) provide information with respect to anysuch Equipment in excess of $250,000 individually or $500,000 in the aggregate, (B) executeand file with the registrar of motor vehicles or other appropriate authority in suchjurisdiction an application or other document requesting the notation or other indicationof the security interest created hereunder on such certificate of title, and (C) deliver tothe Collateral Agent copies of all such applications or other documents filed during suchcalendar quarter and copies of all such certificates of title issued during such calendarquarter indicating the security interest created hereunder in the items of Equipmentcovered thereby.     **4.3 Receivables**.          (a) Representations and Warranties. Each Grantor represents and warrants, on theClosing Date and on each Credit Date, that:          (i) to each Grantor’s knowledge, each Receivable (a) is and will be the legal, validand binding obligation of the Account Debtor in respect thereof, representing anunsatisfied obligation of such Account Debtor, (b) is and will be enforceable in accordancewith its terms, (c) is not and will not be subject to any setoffs, defenses, taxes,counterclaims (except with respect to refunds, returns and allowances in the ordinarycourse of business with respect to damaged merchandise) and (d) is and will be incompliance with all applicable laws, whether federal, state, local or foreign;          (ii) no Receivable of such Grantor in excess of $250,000 individually or $500,000 inthe aggregate requires the consent of the Account Debtor in respect thereof in connectionwith the pledge hereunder, except any consent which has been obtained; and          (iii) no Receivable is evidenced by, or constitutes, an Instrument or Chattel Paperwhich has not been delivered to, or otherwise subjected to the control of, the CollateralAgent to the extent required by, and in accordance with Section 4.3(c).          (b) Covenants and Agreements: Each Grantor hereby covenants and agrees that:
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          (i) it shall keep and maintain at its own cost and expense satisfactory and completerecords of the Receivables in accordance with its business practice, including, but notlimited to, the originals or certified copies of all material documentation with respect toall Receivables and records of all material payments received and all material creditsgranted on the Receivables;          (ii) it shall use commercially reasonable efforts to mark conspicuously, in form andmanner reasonably satisfactory to the Collateral Agent, all Chattel Paper, Instruments andother evidence of Receivables (other than any delivered to the Collateral Agent as providedherein), as well as the Receivables Records with an appropriate reference to the fact thatthe Collateral Agent has a security interest therein;          (iii) it shall perform in all material respects all of its obligations with respect tothe Receivables;          (iv) other than in the ordinary course of business as generally conducted by it on andprior to the date hereof, and except as otherwise provided in subsection (v) below andexcept as otherwise permitted under the Credit Agreement, following an Event of Default,such Grantor shall not (w) grant any extension or renewal of the time of payment of anyReceivable, (x) compromise or settle any dispute, claim or legal proceeding with respect toany Receivable for less than the total unpaid balance thereof, (y) release, wholly orpartially, any Person liable for the payment thereof, or (z) allow any credit or discountthereon;          (v) except as otherwise provided in this subsection, each Grantor shall continue tocollect all amounts due or to become due to such Grantor under the Receivables and anySupporting Obligation and diligently exercise each material right it may have under anyReceivable, any Supporting Obligation or Collateral Support, in each case, at its ownexpense, and in connection with such collections and exercise, such Grantor shall take suchaction as such Grantor or the Collateral Agent may deem necessary or advisable.Notwithstanding the foregoing, the Collateral Agent shall have the right following an Eventof Default to notify, or require any Grantor to notify, any Account Debtor of theCollateral Agent’s security interest in the Receivables and any Supporting Obligation and,in addition, at any time following the occurrence and during the continuation of an Eventof Default, the Collateral Agent may: (1) direct the Account Debtors under any Receivablesto make payment of all amounts due or to become due to such Grantor thereunder directly tothe Collateral Agent; (2) notify, or require any Grantor to notify, each Person maintaininga lockbox or similar arrangement to which Account Debtors under any Receivables have beendirected to make payment to remit allamounts representing collections on checks and other payment items from time to timesent to or deposited in such lockbox or other arrangement directly to the Collateral Agent;and (3) enforce, at the expense of such Grantor, collection of any such Receivables and toadjust, settle or compromise the amount or payment thereof, in the same manner and to thesame extent as such Grantor might have done. If the Collateral Agent notifies any Grantorthat it has elected to collect the Receivables in accordance with the preceding sentence,any payments of Receivables received by such Grantor shall be forthwith (and in any eventwithin two (2) Business Days) deposited by such Grantor in the exact form received, dulyindorsed by such Grantor to the Collateral Agent if required, in the Collateral Accountmaintained under the sole dominion and control of the Collateral Agent, and until so turnedover, all amounts and proceeds (including checks and other instruments) received by suchGrantor in respect of the Receivables, any Supporting
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Obligation or Collateral Supportshall be received in trust for the benefit of the Collateral Agent hereunder and shall besegregated from other funds of such Grantor and such Grantor shall not adjust, settle orcompromise the amount or payment of any Receivable, or release wholly or partly any AccountDebtor or obligor thereof, or allow any credit or discount thereon; and          (vi) it shall use its best efforts to keep in full force and effect any SupportingObligation or Collateral Support relating to any Receivable.          (c) Delivery and Control of Receivables. With respect to any Receivables in excess of$100,000 individually or $500,000 in the aggregate that is evidenced by, or constitutes, ChattelPaper or Instruments, each Grantor shall cause each originally executed copy thereof to bedelivered to the Collateral Agent (or its agent or designee) appropriately indorsed to theCollateral Agent or indorsed in blank: (i) with respect to any such Receivables in existence onthe date hereof, on or prior to the date hereof and (ii) with respect to any such Receivableshereafter arising, within fifteen (15) days of such Grantor acquiring rights therein. With respectto any Receivables in excess of $100,000 individually or $500,000 in the aggregate which wouldconstitute “electronic chattel paper” under Article 9 of the UCC, each Grantor shall take all stepsreasonably necessary to give the Collateral Agent control over such Receivables (within the meaningof Section 9-105 of the UCC): (i) with respect to any such Receivables in existence on the datehereof, on or prior to the date hereof and (ii) with respect to any such Receivables hereafterarising, within fifteen (15) days of such Grantor acquiring rights therein. Any Receivable nototherwise required to be delivered or subjected to the control of the Collateral Agent inaccordance with this subsection (c) shall be delivered or subjected to such control after theoccurrence and during the continuance of an Event of Default upon request of the Collateral Agent.     **4.4 Investment Related Property. 4.4.1**          **4.4.1 Investment Related Property Generally**          (a) Covenants and Agreements. Each Grantor hereby covenants and agrees that:          (i) in the event it acquires rights in any Investment Related Property after the datehereof, it shall deliver to the Collateral Agent a completed Pledge Supplement,substantially in the form of Exhibit A attached hereto, together with allSupplements to Schedules thereto, reflecting such new Investment Related Property andall other Investment Related Property. Notwithstanding the foregoing, it is understood andagreed that the security interest of the Collateral Agent shall attach to all InvestmentRelated Property immediately upon any Grantor’s acquisition of rights therein and shall notbe affected by the failure of any Grantor to deliver a supplement to Schedule 4.4 asrequired hereby;          (ii) except as provided in the next sentence, in the event such Grantor receives anydividends, interest or distributions on any Investment Related Property, or any securitiesor other property upon the merger, consolidation, liquidation or dissolution of any issuerof any Investment Related Property, then (a) such dividends, interest or distributions andsecurities or other property shall be included in the definition of Collateral withoutfurther action and (b) such Grantor shall immediately take all steps, if any, necessary oradvisable to ensure the validity, perfection, priority and, if applicable,
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control of theCollateral Agent over such Investment Related Property (including, without limitation,delivery thereof to the Collateral Agent) and pending any such action such Grantor shall bedeemed to hold such dividends, interest, distributions, securities or other property intrust for the benefit of the Collateral Agent and shall segregate such dividends,distributions, Securities or other property from all other property of such Grantor.Notwithstanding the foregoing, to the extent permitted by the Credit Agreement, so long asno Event of Default shall have occurred and be continuing, the Collateral Agent authorizeseach Grantor to retain and dispose of all ordinary cash dividends and distributions paid bythe issuer and all scheduled payments of interest;          (iii) each Grantor consents to the grant by each other Grantor of a Security Interestin all Investment Related Property to the Collateral Agent.          (b) Delivery and Control.          (i) Each Grantor agrees that with respect to any Investment Related Property in whichit currently has rights it shall comply with the provisions of this Section 4.4.1(b) on orbefore the Credit Date and with respect to any Investment Related Property hereafteracquired by such Grantor it shall comply with the provisions of this Section 4.4.1(b)immediately upon acquiring rights therein, in each case in form and substance reasonablysatisfactory to the Collateral Agent. With respect to any Investment Related Property thatis represented by a certificate or that is an “instrument” (other than any InvestmentRelated Property credited to a Securities Account) it shall cause such certificate orinstrument to be delivered to the Collateral Agent, indorsed in blank by an “effectiveindorsement” (as defined in Section 8-107 of the UCC), regardless of whether suchcertificate constitutes a “certificated security” for purposes of the UCC. With respect toany Investment Related Property that is an “uncertificated security” for purposes of theUCC (other than any “uncertificated securities” credited to a Securities Account), itshall cause the issuer of such uncertificated security to either (i) register theCollateral Agent as the registered owner thereof on the books and records of the issuer or(ii) execute an agreement substantially in the form of Exhibit B hereto, pursuant to whichsuch issuer agrees to comply with the Collateral Agent’s instructions with respect to suchuncertificated security without further consent by such Grantor.          (c) Voting and Distributions.          (i) So long as no Event of Default shall have occurred and be continuing: (1) except as otherwise provided under the covenants and agreements relating toinvestment related property in this Agreement or elsewhere herein or in the CreditAgreement, each Grantor shall be entitled to exercise or refrain from exercising anyand all voting and other consensual rights pertaining to the Investment RelatedProperty or any part thereof for any purpose not inconsistent with the terms of thisAgreement or the Credit Agreement; provided, no Grantor shall exercise or refrain fromexercising any such right if the Collateral Agent shall have notified such Grantorthat, in the Collateral Agent’s reasonable judgment, such action would have a MaterialAdverse Effect on the value of the Investment Related Property or any part thereof;and provided further, such Grantor shall give the Collateral Agent at least five (5)Business Days prior written notice of the manner in which it intends to exercise, orthe reasons for
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   refraining from exercising, any such right; it being understood,however, that neither the voting by such Grantor of any Pledged Stock for, or suchGrantor’s consent to, the election of directors (or similar governing body) at aregularly scheduled annual or other meeting of stockholders or with respect toincidental matters at any such meeting, nor such Grantor’s consent to or approval ofany action otherwise permitted under this Agreement and the Credit Agreement, shall bedeemed prohibited by the terms of this Agreement or the Credit Agreement within themeaning of this Section 4.4(c)(i)(1), and no notice of any such voting or consent needbe given to the Collateral Agent; and  (2) the Collateral Agent shall promptly execute and deliver (or cause to beexecuted and delivered) to each Grantor all proxies, and other instruments as suchGrantor may from time to time reasonably request for the purpose of enabling suchGrantor to exercise the voting and other consensual rights when and to the extentwhich it is entitled to exercise pursuant to clause (1) above;  (3) Upon the occurrence and during the continuation of an Event of Default: (A) all rights of each Grantor to exercise or refrain fromexercising the voting and other consensual rights which it would otherwise beentitled to exercise pursuant hereto shall cease and all such rights shallthereupon become vested in the Collateral Agent who shall thereupon have thesole right to exercise such voting and other consensual rights; and  (B) in order to permit the Collateral Agent to exercise thevoting and other consensual rights which it may be entitled to exercisepursuant hereto and to receive all dividends and other distributions which itmay be entitled to receive hereunder: (1) each Grantor shall promptly executeand deliver (or cause to be executed and delivered) to the Collateral Agentall proxies, dividend payment orders and other instruments as the CollateralAgent may from time to time reasonably request and (2) each Grantoracknowledges that the Collateral Agent may utilize the power of attorney setforth in Section 6.1.          **4.4.2 Pledged Equity Interests**          (a) Representations and Warranties. Each Grantor hereby represents and warrants, onthe Closing Date and on each Credit Date, that:          (i) Schedule 4.4(A) (as such schedule may be amended or supplemented from time totime) sets forth under the headings “Pledged Stock, “Pledged LLC Interests,” “PledgedPartnership Interests” and “Pledged Trust Interests,” respectively, all of the PledgedStock, Pledged LLC Interests, Pledged Partnership Interests and Pledged Trust Interestsowned by any Grantor and such Pledged Equity Interests constitute the percentage of issuedand outstanding shares of stock, percentage of membership interests, percentage ofpartnership interests or percentage of beneficial interest of the respective issuersthereof indicated on such Schedule;
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          (ii) except as set forth on Schedule 4.4(B), it has not acquired any equity interestsof another entity or substantially all the assets of another entity within the past five(5) years;          (iii) it is the record and beneficial owner of the Pledged Equity Interests free ofall Liens, rights or claims of other Persons other than Permitted Liens and there are nooutstanding warrants, options or other rights to purchase, or shareholder, voting trust orsimilar agreements outstanding with respect to, or property that is convertible into, orthat requires the issuance or sale of, any Pledged Equity Interests;          (iv) without limiting the generality of Section 4.1(a)(v), subject to restrictions andlimitations in the Credit Documents or under applicable law, no consent of any Personincluding any other general or limited partner, any other member of a limited liabilitycompany, any other shareholder or any other trust beneficiary is necessary or desirable inconnection with the creation, perfection or first priority status of the security interestof the Collateral Agent in any Pledged Equity Interests or the exercise by the CollateralAgent of the voting or other rights provided for in this Agreement or the exercise ofremedies in respect thereof;          (v) none of the Pledged LLC Interests nor Pledged Partnership Interests are orrepresent interests in issuers that: (a) are registered as investment companies or (b) aredealt in or traded on securities exchanges or markets; and          (vi) except as otherwise set forth on Schedule 4.4(C), all of the Pledged LLCInterests and Pledged Partnership Interests are or represent interests in issuers that haveopted to be treated as securities under the uniform commercial code of any jurisdiction.          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees that:          (i) other than as permitted or not prohibited under the Credit Agreement, without theprior written consent of the Collateral Agent (such consent not to be unreasonably withheldor delayed), it shall not vote to enable or take any other action to: (a) amend orterminate any partnership agreement, limited liability company agreement, certificate ofincorporation, by-laws or other organizational documents in any way that materially changesthe rights of such Grantor with respect to any Investment Related Property or adverselyaffects the validity, perfection or priority of the Collateral Agent’s security interest,(b) permit any issuer of any Pledged Equity Interest to issue anyadditional stock, partnership interests, limited liability company interests or otherequity interests of any nature or to issue securities convertible into or granting theright of purchase or exchange for any stock or other equity interest of any nature of suchissuer, (c) other than as permitted or not prohibited under the Credit Agreement, permitany issuer of any Pledged Equity Interest to dispose of all or a material portion of theirassets, (d) waive any default under or breach of any terms of organizational documentrelating to the issuer of any Pledged Equity Interest or the terms of any Pledged Debt, or(e) cause any issuer of any Pledged Partnership Interests or Pledged LLC Interests whichare not securities (for purposes of the UCC) on the date hereof to elect or otherwise takeany action to cause such Pledged Partnership Interests or Pledged LLC Interests to betreated as securities for purposes of the UCC; provided, however, notwithstanding theforegoing, if any issuer of any Pledged Partnership Interests or Pledged LLC Intereststakes any such
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action in violation of the foregoing in this clause (e), such Grantor shallpromptly notify the Collateral Agent in writing of any such election or action and, in suchevent, shall take all steps necessary or advisable to establish the Collateral Agent’s“control” thereof;          (ii) it shall comply with all of its obligations under any partnership agreement orlimited liability company agreement relating to Pledged Partnership Interests or PledgedLLC Interests and shall enforce all of its rights with respect to any Investment RelatedProperty;          (iii) except as permitted or not prohibited by the Credit Agreement, without the priorwritten consent of the Collateral Agent, it shall not permit any issuer of any PledgedEquity Interest to merge or consolidate unless (i) such issuer creates a security interestthat is perfected by a filed financing statement (that is not effective solely undersection 9-508 of the UCC) in collateral in which such new debtor has or acquires rights,and (ii) all the outstanding capital stock or other equity interests of the surviving orresulting corporation, limited liability company, partnership or other entity is, upon suchmerger or consolidation, pledged hereunder and no cash, securities or other property isdistributed in respect of the outstanding equity interests of any other constituentGrantor; provided that if the surviving or resulting Grantors upon any such merger orconsolidation involving an issuer which is a Controlled Foreign Corporation or ForeignSubsidiary, then such Grantor shall only be required to pledge equity interests inaccordance with Section 2.2; and          (iv) each Grantor consents to the grant by each other Grantor of a security interestin all Investment Related Property to the Collateral Agent and, without limiting theforegoing, consents to the transfer of any Pledged Partnership Interest and any Pledged LLCInterest to the Collateral Agent or its nominee following the occurrence and during thecontinuance of an Event of Default and to the substitution of the Collateral Agent or itsnominee as a partner in any partnership or as a member in any limited liability companywith all the rights and powers related thereto.          **4.4.3 Pledged Debt**          (a) Representations and Warranties. Each Grantor hereby represents and warrants, onthe Closing Date and each Credit Date, that:          (i) Schedule 4.4 (as such schedule may be amended or supplemented from time to time)sets forth under the heading “Pledged Debt” all of the Pledged Debt owned by any Grantorand all of such Pledged Debt has been duly authorized, authenticated or issued, and delivered and is the legal, valid and bindingobligation of the issuers thereof and is not in default and constitutes all of the issuedand outstanding inter-company Indebtedness;          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees that:          (i) it shall notify the Collateral Agent of any default under any Pledged Debt thathas caused, either in any individual case or in the aggregate, a Material Adverse Effect.          **4.4.4 Investment Accounts**
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          (a) Representations and Warranties. Each Grantor hereby represents and warrants, onthe Closing Date and each Credit Date, that:          (i) Schedule 4.4 hereto (as such schedule may be amended or supplemented from time totime) sets forth under the headings “Securities Accounts” and “Commodities Accounts,”respectively, all of the Securities Accounts and Commodities Accounts in which each Grantorhas an interest. Each Grantor is the sole entitlement holder of each such SecuritiesAccount and Commodity Account, and such Grantor has not consented to, and is not otherwiseaware of, any Person (other than the Collateral Agent pursuant hereto) having “control”(within the meanings of Sections 8-106 and 9-106 of the UCC) over, or any other interestin, any such Securities Account or Commodity Account or securities or other propertycredited thereto;          (ii) Schedule 4.4 hereto (as such schedule may be amended or supplemented from time totime) sets forth under the headings “Deposit Accounts” all of the Deposit Accounts in whicheach Grantor has an interest. Each Grantor is the sole account holder of each such DepositAccount and such Grantor has not consented to, and is not otherwise aware of, any Person(other than the Collateral Agent pursuant hereto) having sole “control” (within themeanings of Section 9-104 of the UCC) over, or any other interest in, any such DepositAccount or any money or other property deposited therein; and          (iii) Except as otherwise set forth on Schedule 5.21 to the Credit Agreement withrespect solely to the items of Investment Related Property specified therein, each Grantorhas taken all actions necessary or desirable, including those specified in Section4.4.4(c), to: (a) establish Collateral Agent’s “control” (within the meanings of Sections8-106 and 9-106 of the UCC) over any portion of the Investment Related Propertyconstituting Certificated Securities, Uncertificated Securities, Securities Accounts,Securities Entitlements or Commodities Accounts (each as defined in the UCC); (b) establishthe Collateral Agent’s “control” (within the meaning of Section 9-104 of the UCC) over allDeposit Accounts; and (c) deliver all Instruments to the Collateral Agent.          (b) Covenant and Agreement. Each Grantor hereby covenants and agrees with theCollateral Agent and each other Secured Party that it shall not close or terminate any InvestmentAccount without the prior consent of the Collateral Agent (such consent not to be unreasonablywithheld or delayed) and unless a successor or replacement account has been established with theconsent of the Collateral Agent (such consent not to be unreasonablywithheld or delayed) with respect to which successor or replacement account a controlagreement has been entered into by the appropriate Grantor, Collateral Agent and securitiesintermediary or depository institution at which such successor or replacement account is to bemaintained in accordance with the provisions of Section 4.4.4(c).          (c) Delivery and Control          (i) With respect to any Investment Related Property consisting of Securities Accountsor Securities Entitlements, it shall cause the securities intermediary maintaining suchSecurities Account or Securities Entitlement to enter into an agreement substantially inthe form of Exhibit C hereto, or such other agreement acceptable to Collateral Agent,pursuant to which it shall agree to comply with the Collateral Agent’s “entitlement orders”without further consent by such Grantor. With
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respect to any Investment Related Propertythat is a “Deposit Account,” it shall cause the depositary institution maintaining suchaccount to enter into an agreement substantially in the form of Exhibit D hereto, or suchother agreement acceptable to Collateral Agent, pursuant to which the Collateral Agentshall have sole “control” (within the meaning of Section 9-104 of the UCC) over suchDeposit Account. Each Grantor shall have entered into such control agreement or agreementswith respect to: (i) any Securities Accounts, Securities Entitlements or Deposit Accountsthat exist on the Credit Date, as of or prior to the Credit Date and (ii) any SecuritiesAccounts, Securities Entitlements or Deposit Accounts that are created or acquired afterthe Credit Date, as of or prior to the deposit or transfer of any such SecuritiesEntitlements or funds, whether constituting moneys or investments, into such SecuritiesAccounts or Deposit Accounts.In addition to the foregoing, if any issuer of any Investment Related Property is locatedin a jurisdiction outside of the United States, each Grantor shall take such additionalactions, including, without limitation, causing the issuer to register the pledge on itsbooks and records or making such filings or recordings, in each case as may be necessary oradvisable, under the laws of such issuer’s jurisdiction to insure the validity, perfectionand priority of the security interest of the Collateral Agent. Upon the occurrence andduring the continuance of an Event of Default, the Collateral Agent shall have the right,without notice to any Grantor, to transfer all or any portion of the Investment RelatedProperty to its name or the name of its nominee or agent. In addition, the CollateralAgent shall have the right at any time, without notice to any Grantor, to exchange anycertificates or instruments representing any Investment Related Property for certificatesor instruments of smaller or larger denominations.     **4.5 Material Contracts**.          (a) Representations and Warranties. Each Grantor hereby represents and warrants, onthe Closing Date and on each Credit Date, that:          (i) Schedule 4.5 (as such schedule may be amended or supplemented from time to time)sets forth all of the Material Contracts to which such Grantor has rights;          (ii) the Material Contracts, true and complete copies (including any amendments orsupplements thereof) of which have been furnished or made readilyavailable to the Collateral Agent, have, to the knowledge of the relevant Grantor,been duly authorized, executed and delivered by all parties thereto, are in full force andeffect and are binding upon and enforceable against each relevant Grantor (except asenforceability may be limited by applicable bankruptcy, insolvency, reorganization,moratorium, fraudulent transfer or similar laws affecting the enforcement of creditors’rights generally and by general equitable principles (whether enforcement is sought byproceedings in equity or at law)) and all parties thereto in accordance with theirrespective terms. There exists no material default under any Material Contract by anyparty thereto and neither such Grantor, nor to its best knowledge, any other Person partythereto is likely to become in default thereunder and no Person party thereto has anydefenses, counterclaims or right of set-off with respect to any Material Contract. Uponthe occurrence of a Default, each applicable Grantor shall use its commercially reasonablyefforts to obtain an executed consent to the assignment of any Material Contract from eachPerson party to a Material Contract (other than any Grantor) and
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deliver such consent tothe Collateral Agent pursuant to this Agreement if such consent is required pursuant tosuch Material Contract.          (iii) except as provided in clause (ii) above, no Material Contract prohibitsassignment or requires consent of or notice to any Person in connection with the assignmentto the Collateral Agent hereunder, except such as has been given or made or is currentlysought pursuant to Section 4.5 (b)(vii) hereof.          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees that:          (i) in addition to any rights under the Section of this Agreement relating toReceivables, the Collateral Agent may at any time notify, or require any Grantor to sonotify, the counterparty on any Material Contract of the security interest of theCollateral Agent therein. In addition, after the occurrence and during the continuance ofan Event of Default, the Collateral Agent may upon written notice to the applicableGrantor, notify, or require any Grantor to notify, the counterparty to make all paymentsunder the Material Contracts directly to the Collateral Agent;          (ii) each Grantor shall deliver promptly to the Collateral Agent a copy of eachmaterial demand, notice or document received by it relating in any way to any MaterialContract that would reasonably be expected to have a Material Adverse Effect;          (iii) each Grantor shall deliver promptly to the Collateral Agent, after (1) anyMaterial Contract of such Grantor is terminated or amended in a manner that is materiallyadverse to such Grantor or (2) any new Material Contract is entered into by such Grantor,notice thereof as required by Section 5.3 of the Credit Agreement;          (iv) it shall perform in all material respects all of its obligations with respect tothe Material Contracts;          (v) it shall promptly and diligently exercise each material right (except the right oftermination without the consent of the Collateral Agent, such consent not to beunreasonably withheld or delayed) it may have under any Material Contract, any SupportingObligation or Collateral Support, in each case, at its own expense, and inconnection with such collections and exercise, such Grantor shall take such action assuch Grantor or the Collateral Agent may deem necessary or advisable;          (vi) it shall use its best efforts to keep in full force and effect any SupportingObligation or Collateral Support relating to any Material Contract; and          (vii) upon the occurrence and during the continuance of an Event of Default, eachGrantor shall, promptly, with respect to any Non-Assignable Contract in effect on the datehereof, request in writing the consent of the counterparty or counterparties to theNon-Assignable Contract pursuant to the terms of such Non-Assignable Contract or applicablelaw to the assignment or granting of a security interest in such Non-Assignable Contract toSecured Party and use its best efforts to obtain such consent as soon as practicablethereafter.     **4.6 Letter of Credit Rights**.
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          (a) Representations and Warranties. Each Grantor hereby represents and warrants, onthe Closing Date and on each Credit Date, that:          (i) all material letters of credit to which such Grantor has rights are listed onSchedule 4.6 (as such schedule may be amended or supplemented from time to time) hereto;and          (ii) it has obtained the consent of each issuer of any material letter of credit tothe assignment of the proceeds of the letter of credit to the Collateral Agent.          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees that withrespect to any material letter of credit hereafter arising it shall obtain the consent of theissuer thereof to the assignment of the proceeds of the letter of credit to the Collateral Agentand shall deliver to the Collateral Agent a completed Pledge Supplement, substantially in the formof Exhibit A attached hereto, together with all Supplements to Schedules thereto.     **4.7 Intellectual Property**.          (a) Representations and Warranties. Except as disclosed in Schedule 4.7(H) (as suchschedule may be amended or supplemented from time to time), each Grantor hereby represents andwarrants, on the Closing Date and on each Credit Date, that:          (i) Schedule 4.7 (as such schedule may be amended or supplemented from time to time)sets forth a true and complete list of (i) all United States, state and foreignregistrations of and applications for Patents, Trademarks, and Copyrights owned by eachGrantor and (ii) all Patent Licenses, Trademark Licenses, Trade Secret Licenses andCopyright Licenses material to the business of such Grantor;          (ii) it is the sole and exclusive owner of the entire right, title, and interest inand to all Intellectual Property listed with reference to such Grantor on Schedule 4.7(A),(C) and (E) (as each such schedule may be amended or supplemented from time to time), andowns or has the valid right to use all other Intellectual Propertyused in or necessary to conduct its business, free and clear of all Liens, claims,encumbrances and licenses, except for Permitted Liens and the licenses set forth onSchedule 4.7(B), (D), (F) and (G) (as each may be amended or supplemented from time totime);          (iii) to the best of such Grantor’s knowledge, all Intellectual Property owned by suchGrantor is subsisting and has not been adjudged invalid or unenforceable, in whole or inpart, and such Grantor has performed all acts and has paid all renewal, maintenance, andother fees and taxes required to maintain each and every registration and application ofCopyrights, Patents and Trademarks owned by such Grantor in full force and effect;          (iv) to the best of such Grantor’s knowledge, all Intellectual Property owned by suchGrantor is valid and enforceable and no holding, decision, or judgment has been rendered inany action or proceeding before any court or administrative authority challenging thevalidity of such Grantor’s right to register, or such Grantor’s rights to own or use, anyIntellectual Property and no such action or proceeding is pending or, to the best of suchGrantor’s knowledge, threatened;
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          (v) all registrations and applications for Copyrights, Patents and Trademarks owned bysuch Grantor are standing in the name of such Grantor, and none of the Trademarks, Patents,Copyrights or Trade Secrets has been licensed by any Grantor to any Affiliate or thirdparty, except as disclosed in Schedule 4.7(B), (D), (F), or (G) (as each may be amended orsupplemented from time to time);          (vi) each Grantor has been using appropriate statutory notice of registration inconnection with its use of registered Trademarks material to the business of such Grantor,proper marking practices in connection with the use of Patents material to the business ofsuch Grantor, and appropriate notice of copyright in connection with the publication ofCopyrights material to the business of such Grantor;          (vii) each Grantor uses adequate standards of quality in the manufacture,distribution, and sale of all products sold and in the provision of all services renderedunder or in connection with all Trademark Collateral and has taken all commerciallyreasonable action necessary to insure that all licensees of the Trademark Collateral ownedby such Grantor use such adequate standards of quality;          (viii) to the best of such Grantor’s knowledge, the conduct of such Grantor’s businessdoes not infringe upon or otherwise violate any trademark, patent, copyright, trade secretor other intellectual property right owned or controlled by a third party and no claim hasbeen made that the use of any Intellectual Property owned by such Grantor violates theasserted rights of any third party;          (ix) to the best of such Grantor’s knowledge, no third party is infringing upon orotherwise violating any rights in any Intellectual Property owned by such Grantor;          (x) no settlement or consents, covenants not to sue, nonassertion assurances, orreleases have been entered into by such Grantor or bind such Grantor that adversely affectGrantor’s rights to own or use any Intellectual Property; and          (xi) such Grantor has not made a previous assignment, sale, transfer or agreementconstituting a present or future assignment, sale, transfer or agreement of anyIntellectual Property that has not been terminated or released. There is no effectivefinancing statement or other document or instrument now executed, or on file or recorded inany public office, granting a security interest in or otherwise encumbering any part of theIntellectual Property, other than in favor of the Collateral Agent.          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees as follows:          (i) it shall not do any act or omit to do any act whereby any of the IntellectualProperty owned by such Grantor which is material to the business of Grantor may lapse, orbecome abandoned, dedicated to the public, or unenforceable, or which would adverselyaffect the validity, grant, or enforceability of the security interest granted therein;          (ii) it shall not, with respect to any Trademarks which are owned by such Grantor andmaterial to the business of such Grantor, cease the use of any of such Trademarks or failto maintain the level of the quality of products sold and services
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rendered under any ofsuch Trademark at a level at least substantially consistent with the quality of suchproducts and services as of the date hereof, and such Grantor shall take all commerciallyreasonable steps necessary to insure that licensees of such Trademarks use such consistentstandards of quality;          (iii) it shall, within thirty (30) days of the creation or acquisition of anyCopyrightable work which is material to the business of such Grantor, apply to register theCopyright in the United States Copyright Office;          (iv) it shall promptly notify the Collateral Agent if it knows or has reason to knowthat any item of the Intellectual Property that is material to the business of such Grantoris likely to become (a) abandoned or dedicated to the public or placed in the publicdomain, (b) invalid or unenforceable, or (c) subject to any adverse determination ordevelopment (including the institution of proceedings) in any action or proceeding in theUnited States Patent and Trademark Office, the United States Copyright Office, any stateregistry, any foreign counterpart of the foregoing, or any court;          (v) it shall take all reasonable steps in the United States Patent and TrademarkOffice, the United States Copyright Office, any state registry or any foreign counterpartof the foregoing, to pursue any application and maintain any registration of eachTrademark, Patent, and Copyright owned by any Grantor and material to its business which isnow or shall become included in the Intellectual Property Collateral including, but notlimited to, those items on Schedule 4.7(A), (C) and (E) (as each may be amended orsupplemented from time to time);          (vi) in the event that any Intellectual Property owned by or exclusively licensed tosuch Grantor is infringed, misappropriated, or diluted by a third party in any materialrespect, such Grantor shall promptly take all commercially reasonable actions to stop suchinfringement, misappropriation, or dilution and protect its rights in such IntellectualProperty including, but not limited to, the initiation of a suit for injunctive relief andto recover damages;          (vii) it shall promptly (but in no event more than thirty (30) days after any Grantorobtains knowledge thereof) report to the Collateral Agent (i) the filing of any applicationto register any Intellectual Property with the United States Patent and Trademark Office,the United States Copyright Office, or any state registry or foreign counterpart of theforegoing (whether such application is filed by such Grantor or through any agent,employee, licensee, or designee thereof) and (ii) the registration of any IntellectualProperty by any such office, in each case by executing and delivering to the CollateralAgent a completed Pledge Supplement, substantially in the form of Exhibit A attachedhereto, together with all Supplements to Schedules thereto;          (viii) it shall, promptly upon the reasonable request of the Collateral Agent, executeand deliver to the Collateral Agent any document required to acknowledge, confirm,register, record, or perfect the Collateral Agent’s interest in any part of theIntellectual Property Collateral, whether now owned or hereafter acquired;          (ix) except with the prior consent of the Collateral Agent or as permitted under theCredit Agreement, each Grantor shall not execute, and there will not be on file in anypublic office, any financing statement or other document or instruments,
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except financingstatements or other documents or instruments filed or to be filed in favor of theCollateral Agent and each Grantor shall not sell, assign, transfer, license, grant anyoption, or create or suffer to exist any Lien upon or with respect to the IntellectualProperty, except for the Lien created by and under this Agreement and the other CreditDocuments;          (x) it shall hereafter use best efforts so as not to permit the inclusion in anycontract to which it hereafter becomes a party of any provision that could or might in anyway materially impair or prevent the creation of a security interest in, or the assignmentof, such Grantor’s rights and interests in any property included within the definitions ofany Intellectual Property acquired under such contracts;          (xi) it shall take all steps reasonably necessary to protect the secrecy of all TradeSecrets material to the business of such Grantor, including, without limitation, enteringinto confidentiality agreements with employees and labeling and restricting access tosecret information and documents;          (xii) it shall use proper statutory notice in connection with its use of anyIntellectual Property owned by such Grantor; and          (xiii) it shall continue to collect, at its own expense, all amounts due or to becomedue to such Grantor in respect of the Intellectual Property or any portion thereof. Inconnection with such collections, each Grantor may take (and, at the Collateral Agent’sreasonable direction, shall take) such action as such Grantor or the Collateral Agent maydeem reasonably necessary or advisable to enforce collection of such amounts.Notwithstanding the foregoing, the Collateral Agent shall have the right at any time, tonotify, or require any Grantor to notify, any obligors with respect to any such amounts ofthe existence of the security interest created hereby.     **4.8 Commercial Tort Claims**          (a) Representations and Warranties. Each Grantor hereby represents and warrants, onthe Closing Date and on each Credit Date, that Schedule 4.8 (as such schedule maybe amended or supplemented from time to time) sets forth all Commercial Tort Claims of eachGrantor in excess of $250,000 individually or $500,000 in the aggregate; and          (b) Covenants and Agreements. Each Grantor hereby covenants and agrees that withrespect to any Commercial Tort Claim in excess of $250,000 individually or $500,000 in theaggregate hereafter arising it shall deliver to the Collateral Agent a completed Pledge Supplement,substantially in the form of Exhibit A attached hereto, together with all Supplements to Schedulesthereto, identifying such new Commercial Tort Claims.**SECTION 5.** **ACCESS; RIGHT OF INSPECTION AND FURTHER ASSURANCES;ADDITIONAL GRANTORS.**
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     **5.1 Access; Right of Inspection**. Each Grantor will comply with Section 5.11 of the CreditAgreement. The Collateral Agent and its representatives shall at all times have the right to enterany premises of each Grantor and inspect any property of each Grantor where any of the Collateralof such Grantor granted pursuant to this Agreement is located for the purpose of inspecting thesame, observing its use or otherwise protecting its interests therein.     **5.2 Further Assurances**.          (a) Each Grantor agrees that from time to time, at the expense of such Grantor, that it shallpromptly execute and deliver all further instruments and documents, and take all further action,that may be necessary, or that the Collateral Agent may reasonably request, in order to createand/or maintain the validity, perfection or priority (to the extent provided herein and in theCredit Agreement) of and protect any security interest granted hereby or to enable the CollateralAgent to exercise and enforce its rights and remedies hereunder with respect to any Collateral.Without limiting the generality of the foregoing, each Grantor shall:          (i) file such financing or continuation statements, or amendments thereto, and executeand deliver such other agreements, instruments, endorsements, powers of attorney ornotices, as may be necessary, or as the Collateral Agent may reasonably request, in orderto perfect and preserve the security interests granted or purported to be granted hereby;          (ii) take all actions necessary to ensure the recordation of appropriate evidence ofthe liens and security interest granted hereunder in the Intellectual Property with anyintellectual property registry in which said Intellectual Property is registered or inwhich an application for registration is pending including, without limitation, the UnitedStates Patent and Trademark Office, the United States Copyright Office, the variousSecretaries of State, and the foreign counterparts of any of the foregoing;          (iii) at any reasonable time, upon prior written notice and upon request by theCollateral Agent and subject to Sections 5.11 and 9.2 of the Credit Agreement, assemble theCollateral and allow inspection of the Collateral by the Collateral Agent, or personsdesignated by the Collateral Agent; and          (iv) at the Collateral Agent’s request, appear in and defend any action or proceedingthat may affect such Grantor’s title to or the Collateral Agent’s security interest in allor any part of the Collateral.          (b) Each Grantor hereby authorizes the Collateral Agent to file a Record or Records,including, without limitation, financing or continuation statements, and amendments thereto, in anyjurisdictions and with any filing offices as the Collateral Agent may reasonably determine, in itssole discretion, are necessary or advisable to perfect the security interest granted to theCollateral Agent herein. Such financing statements may describe the Collateral in the same manneras described herein or may contain an indication or description of collateral that describes suchproperty in any other manner as the Collateral Agent may determine, in its sole discretion, isnecessary, advisable or prudent to ensure the perfection of the security interest in the Collateralgranted to the Collateral Agent herein, including, without limitation, describing such property as“all assets” or “all personal property, whether now owned or hereafter acquired.” Each Grantorshall furnish to the Collateral Agent from time to time statements and schedules further
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identifying and describing the Collateral and such other reports in connection with the Collateralas the Collateral Agent may reasonably request, all in reasonable detail.          (c) Each Grantor hereby authorizes the Collateral Agent to modify this Agreement afterobtaining such Grantor’s approval of or signature to such modification by amending Schedule 4.7 (assuch schedule may be amended or supplemented from time to time) to include reference to any right,title or interest in any existing Intellectual Property or any Intellectual Property acquired ordeveloped by any Grantor after the execution hereof or to delete any reference to any right, titleor interest in any Intellectual Property in which any Grantor no longer has or claims any right,title or interest.     **5.3 Additional Grantors**. From time to time subsequent to the date hereof, and pursuant toSection 5.13 of the Credit Agreement, additional Persons may become parties hereto as additionalGrantors (each, an **“Additional Grantor"**), by executing a Counterpart Agreement. Upon delivery ofany such counterpart agreement to the Collateral Agent, notice of which is hereby waived byGrantors, each Additional Grantor shall be a Grantor and shall be as fully a party hereto as ifAdditional Grantor were an original signatory hereto. Each Grantor expressly agrees that itsobligations arising hereunder shall not be affected or diminished by the addition or release of anyother Grantor hereunder, nor by any election of Collateral Agent not to cause any Subsidiary ofCompany to become an Additional Grantor hereunder. This Agreement shall be fully effective as toany Grantor that is or becomes a party hereto regardless of whether any other Person becomes orfails to become or ceases to be a Grantor hereunder.**SECTION 6. COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT.**     **6.1 Power of Attorney**. Each Grantor hereby irrevocably appoints the Collateral Agent (suchappointment being coupled with an interest) as such Grantor’s attorney-in-fact, with full authorityin the place and stead of such Grantor and in the name of such Grantor, the Collateral Agent orotherwise, from time to time in the Collateral Agent’s discretion to take any action and to executeany instrument that the Collateral Agent may deem reasonably necessary or advisable to accomplishthe purposes of this Agreement, including, without limitation, the following:          (a) upon the occurrence and during the continuance of any Event of Default, to obtain andadjust insurance required to be maintained by such Grantor or paid to the Collateral Agent pursuantto the Credit Agreement;          (b) upon the occurrence and during the continuance of any Event of Default, to ask for,demand, collect, sue for, recover, compound, receive and give acquittance and receipts for moneysdue and to become due under or in respect of any of the Collateral;          (c) upon the occurrence and during the continuance of any Event of Default, to receive,endorse and collect any drafts or other instruments, documents and chattel paper in connection withclause (b) above;          (d) upon the occurrence and during the continuance of any Event of Default, to file any claimsor take any action or institute any proceedings that the Collateral Agent may deem necessary ordesirable for the collection of any of the Collateral or otherwise to enforce the rights of theCollateral Agent with respect to any of the Collateral;
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          (e) to prepare and file any UCC financing statements against such Grantor as debtor;          (f) to prepare, sign, and file for recordation in any intellectual property registry,appropriate evidence of the lien and security interest granted herein in the Intellectual Propertyin the name of such Grantor as debtor;          (g) to take or cause to be taken all actions necessary to perform or comply or causeperformance or compliance with the terms of this Agreement, including, without limitation, accessto pay or discharge taxes or Liens (other than Permitted Liens) levied or placed upon or threatenedagainst the Collateral, the legality or validity thereof and the amounts necessary to discharge thesame to be determined by the Collateral Agent in its sole discretion, any such payments made by theCollateral Agent to become obligations of such Grantor to the Collateral Agent, due and payableimmediately without demand; and          (h) upon the occurrence and during the continuance of an Event of Default to sell, transfer,pledge, make any agreement with respect to or otherwise deal with any of the Collateral as fullyand completely as though the Collateral Agent were the absolute owner thereof for all purposes, andto do, at the Collateral Agent’s option and such Grantor’s expense, at any time or from time totime, all acts and things that the Collateral Agent deems reasonably necessary to protect, preserveor realize upon the Collateral and the Collateral Agent’s security interest therein in order toeffect the intent of this Agreement, all as fully and effectively as such Grantor might do.     **6.2 No Duty on the Part of Collateral Agent or Secured Parties**. The powers conferred on theCollateral Agent hereunder are solely to protect the interests of the Secured Parties in theCollateral and shall not impose any duty upon the Collateral Agent or any Secured Party to exerciseany such powers. The Collateral Agent and the Secured Parties shall be accountable only foramounts that they actually receive as a result of the exercise of such powers, and neither they norany of their officers, directors, employees or agents shall be responsible to any Grantor for anyact or failure to act hereunder, except for their own gross negligence or willful misconduct.**SECTION 7. REMEDIES.**     **7.1 Generally**.          (a) If any Event of Default shall have occurred and be continuing, the Collateral Agent mayexercise in respect of the Collateral, in addition to all other rights and remedies provided forherein or otherwise available to it at law or in equity, all the rights and remedies of theCollateral Agent on default under the UCC (whether or not the UCC applies to the affectedCollateral) to collect, enforce or satisfy any Secured Obligations then owing, whether byacceleration or otherwise, and also may pursue any of the following separately, successively orsimultaneously:          (i) require any Grantor to, and each Grantor hereby agrees that it shall at itsexpense and promptly upon request of the Collateral Agent forthwith, assemble all or partof the Collateral as directed by the Collateral Agent and make it available to theCollateral Agent at a place to be designated by the Collateral Agent that is reasonablyconvenient to both parties;
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          (ii) enter onto the property where any Collateral is located and take possessionthereof with or without judicial process;          (iii) prior to the disposition of the Collateral, store, process, repair orrecondition the Collateral or otherwise prepare the Collateral for disposition in anymanner to the extent the Collateral Agent deems appropriate; and          (iv) without notice except as specified below or under the UCC, sell, assign, lease,license (on an exclusive or nonexclusive basis) or otherwise dispose of the Collateral orany part thereof in one or more parcels at public or private sale, at any of the CollateralAgent’s offices or elsewhere, for cash, on credit or for future delivery, at such time ortimes and at such price or prices and upon such other terms as the Collateral Agent maydeem commercially reasonable.          (b) The Collateral Agent or any Secured Party may be the purchaser of any or all of theCollateral at any public or private (to the extent to the portion of the Collateral being privatelysold is of a kind that is customarily sold on a recognized market or the subject of widelydistributed standard price quotations) sale in accordance with the UCC and the Collateral Agent, ascollateral agent for and representative of the Secured Parties, shall be entitled, for the purposeof bidding and making settlement or payment of the purchase price for all or any portion of theCollateral sold at any such sale made in accordance with the UCC, to use and apply any of theSecured Obligations as a credit on account of the purchase price for any Collateral payable by theCollateral Agent at such sale. Each purchaser at any such sale shall hold the property soldabsolutely free from any claim or right on the part of any Grantor, and each Grantor hereby waives(to the extent permitted by applicable law and in accordance with the UCC) all rights ofredemption, stay and/or appraisal which it now has or may at any time in the future have under anyrule of law or statute now existing or hereafter enacted. Each Grantor agrees that, to the extentnotice of sale shall be required by law, at least ten (10) days notice to such Grantor of the timeand place of any public sale or the time after which any private sale is to be made shallconstitute reasonable notification. The Collateral Agent shall not be obligated to make any saleof Collateral regardless of notice of sale having been given. The Collateral Agent may adjourn anypublic or private sale from time to time by announcement at the time and place fixed therefor, andsuch sale may, without further notice, be made at the time and place to which it was soadjourned. Each Grantor agrees that it would not be commercially unreasonable for theCollateral Agent to dispose of the Collateral or any portion thereof by using Internet sites thatprovide for the auction of assets of the types included in the Collateral or that have thereasonable capability of doing so, or that match buyers and sellers of assets. Each Grantor herebywaives any claims against the Collateral Agent arising by reason of the fact that the price atwhich any Collateral may have been sold at such a private sale was less than the price which mighthave been obtained at a public sale, even if the Collateral Agent accepts the first offer receivedand does not offer such Collateral to more than one offeree. If the proceeds of any sale or otherdisposition of the Collateral are insufficient to pay all the Secured Obligations, Grantors shallbe liable for the deficiency and the fees of any attorneys employed by the Collateral Agent tocollect such deficiency. Each Grantor further agrees that a breach of any of the covenantscontained in this Section will cause irreparable injury to the Collateral Agent, that theCollateral Agent has no adequate remedy at law in respect of such breach and, as a consequence,that each and every covenant contained in this Section shall be specifically enforceable againstsuch Grantor, and such Grantor hereby waives and agrees not to assert any defenses against anaction for specific performance of such covenants except for a defense that no default has occurredgiving rise to the Secured Obligations becoming due and payable prior to their stated maturities.Nothing in this Section shall in any way alter the rights of the Collateral Agent hereunder.
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          (c) The Collateral Agent may sell the Collateral without giving any warranties as to theCollateral. The Collateral Agent may specifically disclaim or modify any warranties of title orthe like. This procedure will not be considered to adversely affect the commercial reasonablenessof any sale of the Collateral.          (d) The Collateral Agent shall have no obligation to marshal any of the Collateral.     **7.2 Application of Proceeds**. Except as expressly provided elsewhere in this Agreement,following the occurrence and during the continuance of an Event of Default or during the exerciseof remedies available to the Collateral Agent, all proceeds received by the Collateral Agent inrespect of any sale, any collection from, or other realization upon all or any part of theCollateral shall be applied in full or in part by the Collateral Agent against, the SecuredObligations in the following order of priority: first, to the payment of all costs and expenses ofsuch sale, collection or other realization, including reasonable compensation to the CollateralAgent and its agents and counsel, and all other reasonable expenses, liabilities and advances madeor incurred by the Collateral Agent in connection therewith, and all amounts for which theCollateral Agent is entitled to indemnification hereunder (in its capacity as the Collateral Agentand not as a Lender) and all advances made by the Collateral Agent hereunder for the account of theapplicable Grantor, and to the payment of all costs and expenses paid or incurred by the CollateralAgent in connection with the exercise of any right or remedy hereunder or under the CreditAgreement, all in accordance with the terms hereof or thereof; second, to the extent of any excessof such proceeds, to the payment of all other Secured Obligations for the ratable benefit of theSecured Parties; and third, to the extent of any excess of such proceeds, to the payment to or uponthe order of such Grantor or to whosoever may be lawfully entitled to receive the same or as acourt of competent jurisdiction may direct.     **7.3 Sales on Credit**. If Collateral Agent sells any of the Collateral upon credit, Grantor will be credited onlywith payments actually made by purchaser and received by Collateral Agent and applied toindebtedness of the purchaser. In the event the purchaser fails to pay for the Collateral,Collateral Agent may resell the Collateral and Grantor shall be credited with proceeds of the sale.     **7.4 Deposit Accounts**.     If any Event of Default shall have occurred and be continuing, the Collateral Agent may applythe balance from any Deposit Account or instruct the bank at which any Deposit Account ismaintained to pay the balance of any Deposit Account to or for the benefit of the Collateral Agent.     **7.5 Investment Related Property**.     Each Grantor recognizes that, by reason of certain prohibitions contained in the SecuritiesAct and applicable state securities laws, the Collateral Agent may be compelled, with respect toany sale of all or any part of the Investment Related Property conducted without prior registrationor qualification of such Investment Related Property under the Securities Act and/or such statesecurities laws, to limit purchasers to those who will agree, among other things, to acquire theInvestment Related Property for their own account, for investment and not with a view to thedistribution or resale thereof. Each Grantor acknowledges that any such private sale may be atprices and on terms less favorable than those obtainable through a public sale without suchrestrictions (including a public offering made pursuant to a registration statement under the
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Securities Act) and, notwithstanding such circumstances, each Grantor agrees that any such privatesale shall be deemed to have been made in a commercially reasonable manner and that the CollateralAgent shall have no obligation to engage in public sales and no obligation to delay the sale of anyInvestment Related Property for the period of time necessary to permit the issuer thereof toregister it for a form of public sale requiring registration under the Securities Act or underapplicable state securities laws, even if such issuer would, or should, agree to so register it.If the Collateral Agent determines to exercise its right to sell any or all of the InvestmentRelated Property, upon written request, each Grantor shall and shall cause each issuer of anyPledged Stock to be sold hereunder, each partnership and each limited liability company from timeto time to furnish to the Collateral Agent all such information as the Collateral Agent may requestin order to determine the number and nature of interest, shares or other instruments included inthe Investment Related Property which may be sold by the Collateral Agent in exempt transactionsunder the Securities Act and the rules and regulations of the Securities and Exchange Commissionthereunder, as the same are from time to time in effect.     **7.6 Intellectual Property**.          (a) Anything contained herein to the contrary notwithstanding, upon the occurrence and duringthe continuation of an Event of Default:          (i) the Collateral Agent shall have the right (but not the obligation) to bring suitor otherwise commence any action or proceeding in the name of any Grantor, the CollateralAgent or otherwise, in the Collateral Agent’s sole discretion, to enforce any IntellectualProperty, in which event such Grantor shall, at the request of the Collateral Agent, do anyand all lawful acts and execute any and all documents required by the Collateral Agent inaid of such enforcement and such Grantor shall promptly, upon demand, reimburse andindemnify the Collateral Agent as provided in Section 10 hereof in connection with theexercise of its rights under this Section, and, tothe extent that the Collateral Agent shall elect not to bring suit to enforce anyIntellectual Property as provided in this Section, each Grantor agrees to use allreasonable measures, whether by action, suit, proceeding or otherwise, to prevent theinfringement or other violation of any of such Grantor’s rights in the IntellectualProperty material to the business of such Grantor by others and for that purpose agrees todiligently maintain any action, suit or proceeding against any Person so infringing asshall be necessary to prevent such infringement or violation;          (ii) upon written demand from the Collateral Agent, each Grantor shall grant, assign,convey or otherwise transfer to the Collateral Agent or such Collateral Agent’s designeeall of such Grantor’s right, title and interest in and to the Intellectual Property andshall execute and deliver to the Collateral Agent such documents as are necessary orappropriate to carry out the intent and purposes of this Agreement;          (iii) each Grantor agrees that such an assignment and/or recording shall be applied toreduce the Secured Obligations outstanding only to the extent that the Collateral Agent (orany Secured Party) receives cash proceeds in respect of the sale of, or other realizationupon, the Intellectual Property;          (iv) within five (5) Business Days after written notice from the Collateral Agent,each Grantor shall make available to the Collateral Agent, to the extent within suchGrantor’s power and authority and applicable law, such personnel in such
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Grantor’s employon the date of such Event of Default as the Collateral Agent may reasonably designate, byname, title or job responsibility, to permit such Grantor to continue, directly orindirectly, to produce, advertise and sell the products and services sold or delivered bysuch Grantor under or in connection with the Trademarks, Trademark Licenses, such personsto be available to perform their prior functions on the Collateral Agent’s behalf and to becompensated by the Collateral Agent at such Grantor’s expense on a per diem, pro-rata basisconsistent with the salary and benefit structure applicable to each as of the date of suchEvent of Default; and          (v) the Collateral Agent shall have the right to notify, or require each Grantor tonotify, any obligors with respect to amounts due or to become due to such Grantor inrespect of the Intellectual Property, of the existence of the security interest createdherein, to direct such obligors to make payment of all such amounts directly to theCollateral Agent, and, upon such notification and at the expense of such Grantor, toenforce collection of any such amounts and to adjust, settle or compromise the amount orpayment thereof, in the same manner and to the same extent as such Grantor might have done; (1) all amounts and proceeds (including checks and other instruments) received byGrantor in respect of amounts due to such Grantor in respect of the Collateral or anyportion thereof shall be received in trust for the benefit of the Collateral Agenthereunder, shall be segregated from other funds of such Grantor and shall be forthwithpaid over or delivered to the Collateral Agent in the same form as so received (withany necessary endorsement) to be held as cash Collateral and applied as provided bySection 7.7 hereof; and  (2) Grantor shall not adjust, settle or compromise the amount or payment of anysuch amount or release wholly or partly any obligor with respect thereto or allow anycredit or discount thereon, except with the Collateral Agent’s consent.          (b) If (i) an Event of Default shall have occurred and, by reason of cure, waiver,modification, amendment or otherwise, is no longer be continuing, (ii) no other Event of Defaultshall have occurred and be continuing, (iii) an assignment or other transfer to the CollateralAgent of any rights, title and interests in and to the Intellectual Property shall have beenpreviously made and shall have become absolute and effective, and (iv) the Secured Obligationsshall not have become immediately due and payable, upon the written request of any Grantor, theCollateral Agent shall promptly execute and deliver to such Grantor, at such Grantor’s sole costand expense, such assignments or other transfer as may be necessary to reassign to such Grantor anysuch rights, title and interests as may have been assigned to the Collateral Agent as aforesaid,subject to any disposition thereof that may have been made by the Collateral Agent; provided, aftergiving effect to such reassignment, the Collateral Agent’s security interest granted pursuanthereto, as well as all other rights and remedies of the Collateral Agent granted hereunder, shallcontinue to be in full force and effect; and provided further, the rights, title and interests soreassigned shall be free and clear of any other Liens granted by or on behalf of the CollateralAgent and the Secured Parties.          (c) Solely for the purpose of enabling the Collateral Agent to exercise rights and remediesunder this Section 7 and at such time as the Collateral Agent shall be lawfully entitled toexercise such rights and remedies, each Grantor hereby grants to the Collateral Agent, to theextent it has the right to do so, an irrevocable, nonexclusive license (exercisable without paymentof royalty or other compensation to such Grantor), subject, in the case of Trademarks, to
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qualitycontrol and quality standards then in effect and inspection rights in favor of such Grantor toavoid the risk of invalidation of said Trademarks, to use, operate under, license, or sublicenseany Intellectual Property now owned or hereafter acquired by such Grantor, and wherever the samemay be located.     **7.7 Cash Proceeds**. In addition to the rights of the Collateral Agent specified in Section 4.3with respect to payments of Receivables, all proceeds of any Collateral received by any Grantorconsisting of cash, checks and other non-cash items (collectively, “**Cash Proceeds**”) shall be heldby such Grantor in trust for the Collateral Agent, segregated from other funds of such Grantor, andshall, forthwith upon receipt by such Grantor, unless otherwise provided pursuant to Section4.4(a)(ii), be turned over to the Collateral Agent in the exact form received by such Grantor (dulyindorsed by such Grantor to the Collateral Agent, if required) and held by the Collateral Agent inthe Collateral Account. Any Cash Proceeds received by the Collateral Agent (whether from a Grantoror otherwise): (i) if no Event of Default shall have occurred and be continuing, shall be held bythe Collateral Agent for the ratable benefit of the Secured Parties, as collateral security for theSecured Obligations (whether matured or unmatured) and (ii) if an Event of Default shall haveoccurred and be continuing, may, in the sole discretion of the Collateral Agent, (A) be held by theCollateral Agent for the ratable benefit of the Secured Parties, as collateral security for theSecured Obligations (whether matured or unmatured) and/or (B) then or at any time thereafter may beapplied by the Collateral Agent against the Secured Obligations then due and owing.     **7.8 Acknowledgement**. Notwithstanding the foregoing, the Collateral Agent and the Lenders expressly acknowledgeand agree that any transfer of the Pledged Equity Interests, or any exercise of control withrespect thereto, is subject to, and shall be effected solely in compliance with, applicableregulatory requirements.     Notwithstanding the foregoing or anything herein to the contrary, the Collateral Agent, foritself and on behalf of the Secured Parties, and the Lenders expressly acknowledge and agree thatany exercise by the Collateral Agent or a Secured Party of their rights and remedies hereunder,including any transfer of the Pledged Equity Interests, or any exercise of control by theCollateral Agent with respect thereto, is subject to, and shall be effected solely in compliancewith, applicable regulatory requirements.**SECTION 8. COLLATERAL AGENT.**     The Collateral Agent has been appointed to act as Collateral Agent hereunder by Lenders and,by their acceptance of the benefits hereof, the other Secured Parties. The Collateral Agent shallbe obligated, and shall have the right hereunder, to make demands, to give notices, to exercise orrefrain from exercising any rights, and to take or refrain from taking any action (including,without limitation, the release or substitution of Collateral), solely in accordance with thisAgreement and the Credit Agreement; provided, the Collateral Agent shall, after payment in full ofall Obligations under the Credit Agreement and the other Credit Documents, exercise, or refrainfrom exercising, any remedies provided for herein in accordance with the instructions of theholders of a majority of the aggregate notional amount (or, with respect to any Hedge Agreementthat has been terminated in accordance with its terms, the amount then due and payable (exclusiveof expenses and similar payments but including any early termination payments then due) under suchHedge Agreement) under all Hedge Agreements. In furtherance of the foregoing provisions of thisSection, each Secured Party, by its acceptance of the benefits hereof, agrees that it shall have noright individually to realize upon any of the Collateral hereunder, it being understood and agreedby such Secured Party that all rights and remedies
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hereunder may be exercised solely by theCollateral Agent for the benefit of Secured Parties in accordance with the terms of this Section.Collateral Agent may resign at any time by giving thirty (30) days’ prior written notice thereof toLenders and the Grantors, and Collateral Agent may be removed at any time with or without cause byan instrument or concurrent instruments in writing delivered to the Grantors and Collateral Agentsigned by the Requisite Lenders. Upon any such notice of resignation or any such removal,Requisite Lenders shall have the right, upon five (5) Business Days’ notice to the AdministrativeAgent, to appoint a successor Collateral Agent. Upon the acceptance of any appointment asCollateral Agent hereunder by a successor Collateral Agent, that successor Collateral Agent shallthereupon succeed to and become vested with all the rights, powers, privileges and duties of theretiring or removed Collateral Agent under this Agreement, and the retiring or removed CollateralAgent under this Agreement shall promptly (i) transfer to such successor Collateral Agent all sums,Securities and other items of Collateral held hereunder, together with all records and otherdocuments necessary or appropriate in connection with the performance of the duties of thesuccessor Collateral Agent under this Agreement, and (ii) execute and deliver to such successorCollateral Agent or otherwise authorize the filing of such amendments to financing statements, andtake such other actions, as may be necessary or appropriate in connection with the assignment tosuch successor Collateral Agent of the security interests created hereunder, whereupon suchretiring or removed Collateral Agent shall be discharged from its duties and obligations under thisAgreement. After any retiring or removed Collateral Agent’s resignation or removal hereunder asthe Collateral Agent, the provisions of this Agreement shall inure to its benefit as to any actionstaken or omitted to be taken by it under this Agreement while it was the Collateral Agenthereunder.**SECTION 9. CONTINUING SECURITY INTEREST; TRANSFER OF LOANS.**     This Agreement shall create a continuing security interest in the Collateral and shall remainin full force and effect until the payment in full of all Secured Obligations, the cancellation ortermination of the Commitments and the cancellation or expiration of all outstanding Letters ofCredit, be binding upon each Grantor, its successors and assigns, and inure, together with therights and remedies of the Collateral Agent hereunder, to the benefit of the Collateral Agent andits successors, transferees and assigns. Without limiting the generality of the foregoing, butsubject to the terms of the Credit Agreement, any Lender may assign or otherwise transfer any Loansheld by it to any other Person, and such other Person shall thereupon become vested with all thebenefits in respect thereof granted to Lenders herein or otherwise. Upon the payment in full ofall Secured Obligations, the cancellation or termination of the Commitments and the cancellation orexpiration of all outstanding Letters of Credit, the security interest granted hereby shallautomatically terminate hereunder and of record and all rights to the Collateral shall revert toGrantors. Upon any such termination the Collateral Agent shall, at Grantors’ expense, execute anddeliver to Grantors or otherwise authorize the filing of such documents as Grantors shallreasonably request, including financing statement amendments to evidence such termination. Uponany disposition of property permitted or not prohibited by the Credit Agreement, the Liens grantedherein shall be deemed to be automatically released and such property shall automatically revert tothe applicable Grantor with no further action on the part of any Person. The Collateral Agentshall, at Grantor’s expense, execute and deliver or otherwise authorize the filing of suchdocuments as Grantors shall reasonably request, in form and substance reasonably satisfactory tothe Collateral Agent, including financing statement amendments to evidence such release.**SECTION 10. STANDARD OF CARE; COLLATERAL AGENT MAY PERFORM.**
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     The powers conferred on the Collateral Agent hereunder are solely to protect its interest inthe Collateral and shall not impose any duty upon it to exercise any such powers. Except for theexercise of reasonable care in the custody of any Collateral in its possession and the accountingfor moneys actually received by it hereunder, the Collateral Agent shall have no duty as to anyCollateral or as to the taking of any necessary steps to preserve rights against prior parties orany other rights pertaining to any Collateral. The Collateral Agent shall be deemed to haveexercised reasonable care in the custody and preservation of Collateral in its possession if suchCollateral is accorded treatment substantially equal to that which the Collateral Agent accords itsown property. Neither the Collateral Agent nor any of its directors, officers, employees or agentsshall be liable for failure to demand, collect or realize upon all or any part of the Collateral orfor any delay in doing so or shall be under any obligation to sell or otherwise dispose of anyCollateral upon the request of any Grantor or otherwise. If any Grantor fails to perform anyagreement contained herein, the Collateral Agent may itself perform, or cause performance of, suchagreement, and the expenses of the Collateral Agent incurred in connection therewith shall bepayable by each Grantor under Section 10.2 of the Credit Agreement.**SECTION 11. MISCELLANEOUS.**     Any notice required or permitted to be given under this Agreement shall be given in accordancewith Section 10.1 of the Credit Agreement. No failure or delay on the part of the Collateral Agentin the exercise of any power, right or privilege hereunder or under any other Credit Document shallimpair such power, right or privilege or be construed to be a waiver of any default or acquiescencetherein, nor shall any single or partial exercise of any such power, right or privilege precludeother or further exercise thereof or of any other power, right or privilege. Allrights and remedies existing under this Agreement and the other Credit Documents arecumulative to, and not exclusive of, any rights or remedies otherwise available. In case anyprovision in or obligation under this Agreement shall be invalid, illegal or unenforceable in anyjurisdiction, the validity, legality and enforceability of the remaining provisions or obligations,or of such provision or obligation in any other jurisdiction, shall not in any way be affected orimpaired thereby. All covenants hereunder shall be given independent effect so that if aparticular action or condition is not permitted by any of such covenants, the fact that it would bepermitted by an exception to, or would otherwise be within the limitations of, another covenantshall not avoid the occurrence of a Default or an Event of Default if such action is taken orcondition exists. This Agreement shall be binding upon and inure to the benefit of the CollateralAgent and Grantors and their respective successors and assigns. No Grantor shall, without theprior written consent of the Collateral Agent given in accordance with the Credit Agreement, assignany right, duty or obligation hereunder. This Agreement and the other Credit Documents embody theentire agreement and understanding between Grantors and the Collateral Agent and supersede allprior agreements and understandings between such parties relating to the subject matter hereof andthereof. Accordingly, the Credit Documents may not be contradicted by evidence of prior,contemporaneous or subsequent oral agreements of the parties. There are no unwritten oralagreements between the parties. This Agreement may be executed in one or more counterparts and bydifferent parties hereto in separate counterparts, each of which when so executed and deliveredshall be deemed an original, but all such counterparts together shall constitute but one and thesame instrument; signature pages may be detached from multiple separate counterparts and attachedto a single counterpart so that all signature pages are physically attached to the same document.     **THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY,AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW**
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**YORK, WITHOUTREGARD TO ITS CONFLICTS OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 AND SECTION 5-1402 OF THE NEWYORK GENERAL OBLIGATION LAWS).**          **ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY GRANTOR ARISING OUT OF OR RELATING HERETO OR ANYOTHER CREDIT DOCUMENT, OR ANY OF THE OBLIGATIONS, SHALL BE BROUGHT IN ANY STATE OR FEDERAL COURT OFCOMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK. BY EXECUTING AND DELIVERING THISAGREEMENT, EACH GRANTOR, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (A) ACCEPTSGENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS; (B) WAIVESANY DEFENSE OF FORUM NON CONVENIENS; (C) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDINGIN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THEAPPLICABLE GRANTOR AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 10.1 OF THE CREDIT AGREEMENT;(D) AGREES THAT SERVICE AS PROVIDED IN CLAUSE (C) ABOVE IS SUFFICIENT TO CONFER PERSONALJURISDICTION OVER THE APPLICABLE GRANTOR IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISECONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT; AND (E) AGREES THAT THE COLLATERALAGENT RETAINS THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRINGPROCEEDINGS AGAINST ANY GRANTOR IN THE COURTS OF ANY OTHER JURISDICTION.**          **EACH OF THE PARTIES HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANYCLAIM OR CAUSE OF ACTION BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER CREDIT DOCUMENTSOR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN TRANSACTION OR THELENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED. THE SCOPE OF THIS WAIVER IS INTENDED TO BEALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THESUBJECT MATTER OF THIS TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMSAND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER ISA MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS ALREADY RELIED ON THISWAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN ITSRELATED FUTURE DEALINGS. EACH PARTY HERETO FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWEDTHIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIALRIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAYNOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLYREFERRING TO THIS SECTION 11 AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER SHALLAPPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THEOTHER CREDIT DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADEHEREUNDER.**
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**IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIALBY THE COURT.**
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          IN WITNESS WHEREOF, each Grantor and the Collateral Agent have caused this Agreement to beduly executed and delivered by their respective officers thereunto duly authorized as of the datefirst written above.         **AMERIGROUP CORPORATION**,    as Grantor           By:      Name:      Title:                    **PHP HOLDINGS, INC.**,    as Grantor           By:      Name:      Title:           [Signature Page to Pledge and Security Agreement]
 

 
         **WACHOVIA BANK, NATIONAL ASSOCIATION**,    as the Collateral Agent           By:      Name:      Title:           [Signature Page to Pledge and Security Agreement]
 

 
SCHEDULE 4.1