Exhibit 10.8


EXECUTION COPY




 


SECURITY AGREEMENT

(with respect to the Revolving Credit Agreement)



made by



SERVICEMASTER CONSUMER SERVICES LIMITED PARTNERSHIP, 

as Pledgor



and



THE SERVICEMASTER COMPANY 

(with respect to Sections 9.15 and 9.16 only)



in favor of



CITIBANK, N.A., 

as Administrative Agent and as Revolving Credit Collateral Agent


Dated as of July 24, 2007


 





















TABLE OF CONTENTS


	
  

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  SECTION 1

  	
   

  	
  DEFINED TERMS

  	
   

  	
  2

  
	
   

  	
  1.1

  	
   

  	
  Definitions

  	
   

  	
  2

  
	
   

  	
  1.2

  	
   

  	
  Other Definitional Provisions

  	
   

  	
  5

  
	
   

  	
   

  	
   

  
	
  SECTION 2

  	
   

  	
  [RESERVED]

  	
   

  	
  5

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 3

  	
   

  	
  GRANT OF SECURITY INTEREST

  	
   

  	
  5

  
	
   

  	
  3.1

  	
   

  	
  Pledged Collateral

  	
   

  	
  5

  
	
   

  	
  3.2

  	
   

  	
  Limitation on Grant; Certain Exceptions

  	
   

  	
  6

  
	
   

  	
  3.3

  	
   

  	
  Intercreditor Relations

  	
   

  	
  7

  
	
   

  	
   

  	
   

  
	
  SECTION 4

  	
   

  	
  REPRESENTATIONS AND
  WARRANTIES

  	
   

  	
  7

  
	
   

  	
  4.1

  	
   

  	
  Title; No Other Liens

  	
   

  	
  8

  
	
   

  	
  4.2

  	
   

  	
  Perfected Liens.

  	
   

  	
  8

  
	
   

  	
   

  	
   

  
	
  SECTION 5

  	
   

  	
  COVENANTS

  	
   

  	
  9

  
	
   

  	
  5.1

  	
   

  	
  Maintenance of Security Interest

  	
   

  	
  9

  
	
   

  	
  5.2

  	
   

  	
  Maintenance of Value of Collateral

  	
   

  	
  9

  
	
   

  	
   

  	
   

  
	
  SECTION 6

  	
   

  	
  REMEDIAL PROVISIONS

  	
   

  	
  10

  
	
   

  	
  6.1

  	
   

  	
  Proceeds to be Turned Over to the Collateral Agent

  	
   

  	
  10

  
	
   

  	
  6.2

  	
   

  	
  Application of Proceeds

  	
   

  	
  10

  
	
   

  	
  6.3

  	
   

  	
  Code and Other Remedies

  	
   

  	
  11

  
	
   

  	
  6.4

  	
   

  	
  Excess Paid Over

  	
   

  	
  12

  
	
   

  	
   

  	
   

  
	
  SECTION 7

  	
   

  	
  THE COLLATERAL AGENT

  	
   

  	
  12

  
	
   

  	
  7.1

  	
   

  	
  Collateral Agent’s Appointment as Attorney-in-Fact,
  etc.

  	
   

  	
  12

  
	
   

  	
  7.2

  	
   

  	
  Duty of Collateral Agent

  	
   

  	
  13

  
	
   

  	
  7.3

  	
   

  	
  Financing Statements

  	
   

  	
  13

  
	
   

  	
  7.4

  	
   

  	
  Authority of Collateral Agent

  	
   

  	
  14

  
	
   

  	
   

  	
   

  
	
  SECTION 8

  	
   

  	
  NON-LENDER SECURED PARTIES

  	
   

  	
  14

  
	
   

  	
  8.1

  	
   

  	
  Rights to Collateral

  	
   

  	
  14

  
	
   

  	
  8.2

  	
   

  	
  Appointment of Agent

  	
   

  	
  15

  
	
   

  	
  8.3

  	
   

  	
  Waiver of Claims

  	
   

  	
  16

  
	
   

  	
   

  	
   

  
	
  SECTION 9

  	
   

  	
  MISCELLANEOUS

  	
   

  	
  16

  
	
   

  	
  9.1

  	
   

  	
  Amendments in Writing

  	
   

  	
  16

  
	
   

  	
  9.2

  	
   

  	
  Notices

  	
   

  	
  16

  
	
   

  	
  9.3

  	
   

  	
  No Waiver by Course of Conduct; Cumulative Remedies

  	
   

  	
  17

  
	
   

  	
  9.4

  	
   

  	
  Indemnification

  	
   

  	
  17

  
	
   

  	
  9.5

  	
   

  	
  Successors and Assigns

  	
   

  	
  17

  
	
   

  	
  9.6

  	
   

  	
  Counterparts

  	
   

  	
  18

  
	
   

  	
  9.7

  	
   

  	
  [Reserved]

  	
   

  	
  18

  
									



 













 


	
  

  	
  9.8

  	
   

  	
  Severability

  	
   

  	
  18

  
	
   

  	
  9.9

  	
   

  	
  Section Headings

  	
   

  	
  18

  
	
   

  	
  9.10

  	
   

  	
  Integration

  	
   

  	
  18

  
	
   

  	
  9.11

  	
   

  	
  GOVERNING LAW

  	
   

  	
  18

  
	
   

  	
  9.12

  	
   

  	
  Submission to Jurisdiction; Waivers

  	
   

  	
  18

  
	
   

  	
  9.13

  	
   

  	
  Acknowledgments

  	
   

  	
  19

  
	
   

  	
  9.14

  	
   

  	
  WAIVER OF JURY TRIAL

  	
   

  	
  19

  
	
   

  	
  9.15

  	
   

  	
  Additional Pledgors

  	
   

  	
  19

  
	
   

  	
  9.16

  	
   

  	
  Releases

  	
   

  	
  20

  
	
   

  	
  9.17

  	
   

  	
  Judgment

  	
   

  	
  21

  



 


SCHEDULES


1         Notice
Address of Pledgor



 2















SECURITY AGREEMENT


(with respect to
the Revolving Credit Agreement)


SECURITY AGREEMENT, dated as of July 24, 2007, made by
ServiceMaster Consumer Services Limited Partnership (the “Pledgor”) and
(with respect to Sections 9.15 and 9.16 only) the Parent Borrower (as defined
below), in favor of CITIBANK, N.A., as collateral agent (in such capacity, the “Revolving
Credit Collateral Agent”) and administrative agent (in such capacity, the “Administrative
Agent”) for the banks and other financial institutions (collectively, the “Lenders”;
individually, a “Lender”) from time to time parties to the Revolving
Credit Agreement described below.


W I T N E S S E T H
:


WHEREAS, pursuant to that certain Revolving Credit
Agreement, dated as of the date hereof (as amended, amended and restated,
waived, supplemented or otherwise modified from time to time, together with any
agreement extending the maturity of, or restructuring, refunding, refinancing
or increasing the Indebtedness under such agreement or any successor agreements,
the “Revolving Credit Agreement”), among the Parent Borrower, the U.S.
Subsidiary Borrowers (together with the Parent Borrower, the “U.S. Borrowers”),
the Foreign Subsidiary Borrowers (as defined in the Revolving Credit Agreement)
from time to time party thereto (together with the U.S. Borrowers, the “Borrowers”),
the Lenders, Citibank, N.A., as Administrative Agent and Revolving Credit
Collateral Agent, and the other parties party thereto, the Lenders have
severally agreed to make extensions of credit to the Borrowers upon the terms
and subject to the conditions set forth therein;


WHEREAS, pursuant to that certain Credit Agreement,
dated as of the date hereof (as amended, amended and restated, waived,
supplemented or otherwise modified from time to time, together with any
agreement extending the maturity of, or restructuring, refunding, refinancing
or increasing the Indebtedness under such agreement or any successor
agreements, the “Term Loan Credit Agreement”), among the Parent Borrower
(as successor by merger to CDRSVM Acquisition Co., a Delaware corporation), the
several banks and other financial institutions from time to time parties
thereto (as further defined in the Term Loan Credit Agreement, the “Term
Loan Lenders”), Citibank, N.A., as administrative agent (in its specific
capacity as administrative agent, the “Term Loan Administrative Agent”),
and collateral agent (in its specific capacity as collateral agent, the “Term
Loan Collateral Agent”) for the Term Loan Lenders thereunder, and the other
parties party thereto, the Term Loan Lenders have severally agreed to make extensions
of credit to the Parent Borrower upon the terms and subject to the conditions
set forth therein;


WHEREAS, pursuant to that certain Security Agreement,
dated as of the date hereof, (as amended, amended and restated, waived,
supplemented or otherwise modified from time to time, the “Term Loan
Security Agreement”) among the Pledgor, the Term Loan Administrative Agent
and the Term Loan Collateral Agent, the Pledgor has granted a Lien to the Term
Loan Collateral Agent for the benefit of the Secured Parties (as defined
therein) on the Pledged Collateral (as defined therein);


WHEREAS, the Revolving Credit Collateral Agent, the
Administrative Agent, the Term Loan Collateral Agent and the Term Loan
Administrative Agent have entered into an Intercreditor 













Agreement, acknowledged by the Parent Borrower,
Holdings and certain Subsidiaries of the Parent Borrower, dated as of the date
hereof (as amended, amended and restated, waived, supplemented or otherwise
modified from time to time (subject to Section 9.1 hereof), the “Intercreditor
Agreement”);


WHEREAS, the Pledgor is a wholly owned subsidiary of
the Parent Borrower, and the Borrowers and the Pledgor are members of an
affiliated group of companies and are engaged in related businesses, and the
Pledgor will derive substantial direct and indirect benefit from the making of
the extensions of credit under the Revolving Credit Agreement; and


WHEREAS, it is a condition to the obligation of the Lenders
to make their respective extensions of credit under the Revolving Credit
Agreement that the Pledgor shall execute and deliver this Agreement to the
Revolving Credit Collateral Agent for the benefit of the Secured Parties.


NOW, THEREFORE, in consideration of the premises and
to induce the Administrative Agent and the Lenders to enter into the Revolving
Credit Agreement and to induce the Lenders to make their respective extensions
of credit to the Borrowers thereunder, and in consideration of the receipt of
other valuable consideration (which receipt is hereby acknowledged), the
Pledgor hereby agrees with the Administrative Agent and the Revolving Credit
Collateral Agent, for the ratable benefit of the Secured Parties (as defined
below), as follows:


SECTION 1     DEFINED
TERMS


1.1                         Definitions


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


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


“Additional Agent”:  as defined in the Intercreditor Agreement.


“Additional Collateral Documents”:  as defined in the Intercreditor Agreement.


“Additional Obligations”:  as defined in the Intercreditor Agreement.


“Administrative Agent”:  as defined in the preamble hereto.


“Agent”: 
as defined in the Intercreditor Agreement.


“Agreement”: 
this Security Agreement, as the same may be amended, restated, supplemented,
waived or otherwise modified from time to time.


“Applicable Law”:  as defined in Section 9.8 hereof.


“Bank Products Agreement”:  any agreement pursuant to which a bank or
other financial institution agrees to provide treasury or cash management
services (including, without limitation, 



 2
 









controlled disbursements, automated clearinghouse
transactions, return items, netting, overdrafts, debit or purchase cards and
interstate depository network services).


“Bankruptcy Case”:  (i) Holding or any of its Subsidiaries
commencing any case, proceeding or other action (A) under any existing or
future law of any jurisdiction, domestic or foreign, relating to bankruptcy,
insolvency, reorganization, conservatorship or relief of debtors, seeking to
have an order for relief entered with respect to it, or seeking to adjudicate
it a bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with
respect to it or its debts, or (B) seeking appointment of a receiver, trustee,
custodian, conservator or other similar official for it or for all or any substantial
part of its assets, or Holding, the Parent Borrower or any of the Parent
Borrower’s Subsidiaries making a general assignment for the benefit of its
creditors; or (ii) there being commenced against Holding, the Parent Borrower
or any of the Parent Borrower’s Subsidiaries any case, proceeding or other
action of a nature referred to in clause (i) above which (A) results in
the entry of an order for relief or any such adjudication or appointment or
(B) remains undismissed, undischarged or unbonded for a period of 60 days.


“Borrower”: 
as defined in the recitals hereto.


“Code”: 
the Uniform Commercial Code as from time to time in effect in the State
of New York.


“Collateral Account Bank”:  [                                                    ],
an Affiliate thereof or another bank which at all times is a Lender as selected
by the Pledgor and consented to in writing by the Revolving Credit Collateral
Agent (such consent not to be unreasonably withheld or delayed).


“Collateral Proceeds Account”:  shall mean a non-interest bearing cash
collateral account established and maintained by the Pledgor at an office of
the Collateral Account Bank in the name, and in the sole dominion and control
of, the Revolving Credit Collateral Agent for the benefit of the Secured
Parties.


“Credit Agreement”:  has the meaning provided in the recitals
hereto.


“Existing Notes Indenture”:  the Indenture between The ServiceMaster
Company Limited Partnership, as issuer, and ServiceMaster Limited Partnership, as
guarantor, and the Existing Notes Trustee, dated as of August 15, 1997, as
supplemented by the First Supplemental Indenture thereto, between the same
parties, dated as of August 15, 1997, the Second Supplemental Indenture
thereto, between the Parent Borrower, as successor by merger to The
ServiceMaster Company Limited Partnership and ServiceMaster Limited
Partnership, and the Existing Notes Trustee, dated as of January 1, 1998, the
Third Supplemental Indenture thereto, between the Parent Borrower and the
Existing Notes Trustee, dated as of March 2, 1998 and the Fourth Supplemental
Indenture, between the Parent Borrower and the Existing Notes Trustee, dated as
of August 10, 1999, as in effect on the Closing Date.


“Existing Notes Trustee” shall mean  The Bank of New York, successor to Harris
Trust and Savings Bank, as trustee under the Existing Notes Indenture.



 3
 









“first priority”:  with respect to any Lien purported to be
created by this Agreement, that such Lien is the most senior Lien to which such
Collateral is subject (subject to Permitted Liens).


“Holding”: 
CDRSVM Holding, Inc., a Delaware corporation.


“Intercreditor Agreement”:  as defined in the recitals hereto.


“Lender”: 
as defined in the preamble hereto.


“Management Loans”:  Indebtedness (including any extension,
renewal or refinancing thereof) outstanding at any time incurred by any
Management Investors in connection with any purchases by them of Management
Stock, which Indebtedness is entitled to the benefit of any Management
Guarantee of the Parent or any of its Subsidiaries.


“Maximum Aggregate Secured Amount”:  as defined in Section 3.2(a) hereof.


“Maximum Secured Amount”:   the Secured Parties’ pro rata share of the
Maximum Aggregate Secured Amount, determined as of any date according to the
respective outstanding principal amounts of Obligations, Term Loan Obligations
and any Additional Obligations, in each case as of such date, in accordance
with the Intercreditor Agreement.


“Non-Lender Secured Parties”:  the collective reference to any person who,
at the time of entering into any Interest Rate Agreement, Currency Agreement,
Commodities Agreement or Banks Products Agreement or Management Loan secured
hereby, was a Lender or an affiliate of any Lender and their respective successors
and assigns.


“Obligations”: 
as defined in the Guarantee and Collateral Agreement.


“Pledged Collateral”:  the Pledged Note, any amounts on deposit in
the Collateral Proceeds Account from time to time and any Proceeds of any of
the foregoing.


“Pledged Note”: 
(i) that promissory note, dated as of [                    ],
made by The Terminix International Company Limited Partnership in favor of the
Pledgor in an original principal amount of $100,000,000, and (ii) any
promissory note that may be pledged by Pledgor in future pursuant to Section
5.2(b) in substitution for, or in addition to, the promissory note described in
clause (i).


“Pledgor”: 
as defined in the preamble hereto.


“Proceeds”: 
all “proceeds” as such term is defined in Section 9-102(a)(64) of the Uniform
Commercial Code in effect in the State of New York on the date hereof.


“Restricted Assets Collateral Documents”:  as defined in the Intercreditor Agreement.


“Revolving Credit Agreement”:  as defined in the recitals hereto.


“Revolving Credit Collateral Agent”:  as defined in the recitals hereto.



 4
 









“Secured Creditor Collateral Account”:  as defined in subsection 5.2.


“Secured Creditors”: as defined in the
Intercreditor Agreement.


“Secured Parties”:  as defined in the Guarantee and Collateral
Agreement.


“Term Loan Administrative Agent”:  as defined in the recitals hereto.


“Term Loan Collateral Agent”:  as defined in the recitals hereto.


“Term Loan Lenders”:  as defined in the recitals hereto.


“Term Loan Obligations”:  as defined in the Intercreditor Agreement.


1.2                         Other
Definitional Provisions


(a)                                  The words “hereof”, “herein”,
“hereto” and “hereunder” and words of similar import when used in this
Agreement shall refer to this Agreement as a whole and not to any particular
provision of this Agreement, and Section, Schedule and Annex references are to
this Agreement unless otherwise specified.


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


(c)                                  All references in
this Agreement to any of the property described in the definition of the
term  “Pledged Collateral” or to any
Proceeds thereof, shall be deemed to be references thereto only to the extent
the same constitute Pledged Collateral.


SECTION 2     [Reserved]


 


 


SECTION 3     GRANT
OF SECURITY INTEREST


3.1                         Pledged
Collateral


The Pledgor hereby grants to the Revolving Credit
Collateral Agent, for the ratable benefit of the Secured Parties, a security
interest in the Pledged Note, any amounts on deposit in the Collateral Proceeds
Account from time to time, and any Proceeds of any of the foregoing, as collateral
security for the prompt and complete performance when due (whether at the
stated maturity, by acceleration or otherwise) of the Obligations of the
Pledgor except as provided in (and subject to the limitations of) subsection
3.2.



 5
 









3.2                         Limitation
on Grant; Certain Exceptions


(a)                                  Notwithstanding any
other provision hereof, the maximum aggregate principal or face amount of
Obligations secured by the Pledged Collateral (1) shall not exceed the Maximum
Secured Amount and (2) when aggregated with the aggregate principal or face
amount of all Term Loan Obligations and all Additional Obligations secured by
the Pledged Collateral, shall be limited to the lesser of (A)(i) 10% of
Consolidated Net Worth as defined in, and determined as of the date hereof in
accordance with, the Existing Notes Indenture, less (ii) $10,000,000 and (B)
such amount as is permitted under Section 5.03(b) of the Existing Notes
Indenture to be secured without giving rise to a requirement that the Existing
Notes be equally and ratably secured pursuant to Section 5.03 of the Existing
Notes Indenture (the “Maximum Aggregate Secured Amount”); provided that


(x)                                    if
the Existing Indenture ceases to be in full force and effect as a result of the
satisfaction and discharge thereof in accordance with its terms, then the
principal or face amount of Obligations secured by the Pledged Collateral
hereunder shall be equal to the aggregate principal or face amount of the
Obligations outstanding, and


(y)                                  if
the Pledgor grants a Lien (other than any Lien arising pursuant to or by reason
of any Loan Document) to any Person on the Pledged Collateral resulting in the
Existing Notes being equally and ratably secured by the Pledged Collateral
pursuant to Section 5.03 of the Existing Notes Indenture, then the principal or
face amount of Obligations secured by the Pledged Collateral hereunder shall be
equal to the aggregate principal or face amount of the Obligations outstanding
for so long as the Existing Notes are so equally and ratably secured (provided
that any Lien granted to the Collateral Agent or any other Secured Party as a
result of this clause (y) shall be automatically released once such Lien is no
longer outstanding).


(b)                                 The Pledgor agrees
that it will not knowingly and voluntarily grant any Lien to any Person other
than any Agent or Secured Creditor on the Pledged Collateral that, to the actual
knowledge of a Responsible Officer of the Pledgor at the time of such grant,
would, pursuant to clause (B) of the preceding subsection 3.2(a), result in the
maximum aggregate principal or face amount of Obligations secured by the
Pledged Collateral (when aggregated with the aggregate principal or face amount
of all Term Loan Obligations and all Additional Obligations secured by the
Pledged Collateral) that is permitted under Section 5.03(b) of the Existing
Notes Indenture to be secured without giving rise to a requirement that the
Existing Notes be equally and ratably secured pursuant to Section 5.03 of the Existing
Notes Indenture, to be less than (i) 10% of Consolidated Net Worth as defined
in, and determined as of the date hereof in accordance with, the Existing Notes
Indenture, less (ii) $10,000,000.


(c)                                  It is the express
intention of the Pledgor, the Revolving Credit Collateral Agent, and the other
Secured Parties to comply with Section 5.03 of the Existing Notes Indenture without
triggering the requirement that the Existing Notes be equally and ratably
secured by any of the Pledged Collateral. 
In furtherance of the foregoing, and notwithstanding anything to the contrary
in this Agreement, (x) nothing in this Agreement shall require the Pledgor to
take or cause to be taken any action as a result of which the Existing Notes
would be required to be equally and ratably secured pursuant to Section 5.03 of
the Existing Notes Indenture, (y) any security interest or Lien arising or
existing hereunder that would give rise to such requirement shall be void ab
initio, and shall be of no force or effect, immediately upon any
determination in good 



 6
 









faith by the Pledgor that such requirement would otherwise exist (in
which event the Pledgor shall notify the Revolving Credit Collateral Agent of
such determination), and (z) the Revolving Credit Collateral Agent and each other
Secured Party shall promptly take such actions to evidence the absence or
termination of any security interest or Lien that would give rise to such requirement,
or that arises as a result of any Lien referred to in clause (y) of clause (a)
of this subsection 3.2, as the Pledgor may reasonably request.


3.3                         Intercreditor
Relations


Notwithstanding anything
herein to the contrary, it is the understanding of the parties that the Liens
granted pursuant to subsection 3.1 hereof shall (x) prior to the Discharge
of Term Loan Obligations (as defined in the Intercreditor Agreement), be pari passu and equal in priority to the Liens granted to the
Term Loan Collateral Agent for the benefit of the holders of the Term Loan
Obligations to secure the Term Loan Obligations pursuant to the applicable Term
Loan Document (as defined in the Intercreditor Agreement) and (y) prior to
the Discharge of Additional Obligations (as defined in the Intercreditor
Agreement), be pari passu and equal in priority
to the Liens granted to any Additional Agent for the benefit of the holders of
the applicable Additional Obligations to secure such Additional Obligations
pursuant to the applicable Additional Collateral Documents (as defined in the
Intercreditor Agreement).  The Revolving
Credit Collateral Agent acknowledges and agrees that the relative priority of
such Liens granted to the Revolving Credit Collateral Agent, the Term Loan
Collateral Agent and any Additional Agent may be determined solely pursuant to
the Intercreditor Agreement, and not by priority as a matter of law or
otherwise.  Notwithstanding anything
herein to the contrary, the Liens and security interest granted to the
Revolving Credit Collateral Agent pursuant to this Agreement and the exercise
of any right or remedy by the Revolving Credit Collateral Agent hereunder are
subject to the provisions of the Intercreditor Agreement.  In the event of any conflict between the
terms of the Intercreditor Agreement and this Agreement, the terms of the
Intercreditor Agreement shall govern and control as among the Revolving Credit
Collateral Agent, the Term Loan Collateral Agent and any Additional Agent,
provided that the limitation in subsection 3.2 shall always apply.  Notwithstanding any other provision hereof,
subject to the terms of the Intercreditor Agreement, (x) for so long as any
Term Loan Obligations remain outstanding, any obligation hereunder to
physically deliver to the Revolving Credit Collateral Agent any Pledged
Collateral may be satisfied by causing such Pledged Collateral to be physically
delivered to the Term Loan Collateral Agent to be held in accordance with the
Intercreditor Agreement and (y) for so long as any Additional Obligations
remain outstanding, any obligation hereunder to physically deliver to the Revolving
Credit Collateral Agent any Pledged Collateral may be satisfied by causing such
Pledged Collateral to be physically delivered to any Additional Agent to be
held in accordance with the Intercreditor Agreement.


SECTION 4     REPRESENTATIONS
AND WARRANTIES


To induce the Revolving Credit Collateral Agent, the
Administrative Agent and the Lenders to enter into the Revolving Credit
Agreement and to induce the Lenders to make their respective extensions of
credit to the Borrowers thereunder, the Pledgor hereby represents and warrants
to the Revolving Credit Collateral Agent and each other Secured Party that, in
each case after giving effect to the Transactions:



 7
 









4.1                         Title;
No Other Liens.  The Pledgor is the
record and beneficial owner of, and has good title to, the Pledged Note, free
of any and all Liens or options in favor of, or claims of, any other Person,
except the security interest created by this Agreement and Liens arising by
operation of law or permitted by the Revolving Credit Agreement (or described
in the definition of “Permitted Lien” in the Revolving Credit Agreement).


4.2                         Perfected
Liens.


(a)                                  This Agreement is
effective to create, as collateral security for the Obligations of the Pledgor
to the extent described in subsection 3.2, valid and enforceable Liens on the
Pledgor’s Pledged Collateral in favor of the Revolving Credit Collateral Agent
for the benefit of the Secured Parties, except as enforceability may be
affected by bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditor’s rights
generally, general equitable principles (whether considered in a proceeding in
equity or at law) and an implied covenant of good faith and fair dealing.


(b)                                 Upon completion of the
Filings and the delivery to and continuing possession by the Revolving Credit
Collateral Agent of the Pledged Note, the Lien created in the Pledged Note pursuant
to this Agreement will constitute a valid Lien on and perfected security
interest in the Pledged Collateral in favor of the Revolving Credit Collateral
Agent for the benefit of the Secured Parties, and will be prior to all other
Liens of all other Persons other than Permitted Liens, and enforceable as such
as against all other Persons other than Ordinary Course Transferees, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and by general equitable principles (whether enforcement
is sought by proceedings in equity or at law) or by an implied covenant of good
faith and fair dealing.  As used in this
subsection 4.2, the following terms shall have the following meanings:


“Filings”: 
the filing or recording of (i) the Financing Statements as set forth in Schedule
3 and (ii) any filings after the Closing Date in any other jurisdiction as
may be necessary under any Requirement of Law.


“Financing Statements”:  the financing statements delivered to the
Revolving Credit Collateral Agent by the Pledgor on the Closing Date for filing
in the jurisdictions listed in Schedule 4.


“Ordinary Course Transferees”:  (i) with respect to goods only, buyers in the
ordinary course of business and lessees in the ordinary course of business to
the extent provided in Section 9-320(a) and 9-321 of the Uniform Commercial
Code as in effect from time to time in the relevant jurisdiction, (ii) with
respect to general intangibles only, licensees in the ordinary course of business
to the extent provided in Section 9-321 of the Uniform Commercial Code as in
effect from time to time in the relevant jurisdiction and (iii) any other
Person who is entitled to take free of the Lien pursuant to the Uniform
Commercial Code as in effect from time to time in the relevant jurisdiction.



 8
 









“Permitted
Liens”:  Liens permitted pursuant to
the Loan Documents, including, without limitation, those permitted to exist
pursuant to subsection 7.2 of the Revolving Credit Agreement.


SECTION 5     COVENANTS


5.1                         Maintenance
of Security Interest.  The Pledgor
covenants and agrees with the Revolving Credit Collateral Agent and the other
Secured Parties that, from and after the date of this Agreement until the
earliest to occur of (i) the Loans, any Reimbursement Obligations and all other
Obligations then due and owing shall have been paid in full in cash and no
Letter of Credit shall be outstanding (except for Letters of Credit that have
been cash collateralized in a manner reasonably satisfactory to the Issuing
Bank), (ii) all the Capital Stock of the Pledgor shall have been sold or
otherwise disposed of (to a Person other than the Parent Borrower or a
Restricted Subsidiary) as permitted under the terms of the Revolving Credit
Agreement, (iii) the designation of the Pledgor as an Unrestricted Subsidiary
or (iv) the Liens created pursuant to this agreement are released as
contemplated by subsection 9.16, the Pledgor shall maintain the security
interest created by this Agreement in the Pledgor’s Pledged Collateral as a
security interest having at least the perfection and priority described in
subsection 4.2.  At any time and from
time to time, upon the written request of the Revolving Credit Collateral Agent
and at the sole expense of the Pledgor, the Pledgor will promptly and duly
execute and deliver such further instruments and documents and take such
further actions as the Revolving Credit Collateral Agent may reasonably request
for the purpose of obtaining or preserving the full benefits of this Agreement
and of the rights and powers herein granted by the Pledgor.


5.2                         Maintenance
of Value of Collateral


(a)                                  In the event that the
Pledgor shall receive any payment of principal of the Pledged Note, the Pledgor
may at its election, so long as no Event of Default specified in Section 8(f)
of the Revolving Credit Agreement shall have occurred and be continuing, cause
such amount to be held on deposit in the Collateral Proceeds Account (or any
other account maintained for the benefit of of any Agent or any Secured
Creditor under any other Restricted Assets Collateral Document relating to the
Pledged Note (any such other account, a “Secured Creditor Collateral Account”))
or disbursed (either directly or after having been held in the Collateral
Proceeds Account or such Secured Creditor Collateral Account) to the Pledgor
and used for any purpose not restricted by the Revolving Credit Agreement.  In furtherance of the foregoing, the
Revolving Credit Collateral Agent agrees to cause any amounts to which the
Pledgor may be entitled under this Section 5.2(a) to be released from the
Collateral Proceeds Account promptly upon the Pledgor’s request.


(b)                                 In the event that (i)
the Pledged Note is released pursuant to Section 9.16(b) or (c) or (ii) the
outstanding principal amount of the Pledged Note plus the amount, if any, on
deposit in the Collateral Proceeds Account plus the amount, if any, on deposit
in all Secured Creditor Collateral Accounts, is less than $99,000,000, the
Revolving Credit Collateral Agent shall have the right (subject to Section
9.15) to require the Pledgor to pledge another promissory note of an obligor
Subsidiary reasonably satisfactory to the Revolving Credit Collateral Agent
(or, if the Pledgor so elects, to deposit an additional amount in the
Collateral Proceeds Account or any other Secured Creditor Collateral Account)
in addition to, or in substitution for, the Pledged Note 



 9
 









being held as part of the Pledged Collateral such that, after giving
effect to such pledge (or deposit) and (if applicable) substitution, the outstanding
principal amount of the Pledged Note plus the amount, if any, on deposit in the
Collateral Proceeds Account, plus the amount, if any, on deposit in all Secured
Creditor Collateral Accounts, will be equal to $100,000,000.  Any such pledge shall be effected by the
Pledgor entering into an appropriate supplement to this Agreement, executed by
the Pledgor and describing the newly pledged note, whereupon such note will be
a Pledged Note hereunder.


SECTION 6     REMEDIAL
PROVISIONS


6.1                         Proceeds
to be Turned Over to the Revolving Credit Collateral Agent.  In each case subject to subsection 3.2,  if an Event of Default specified in
subsection 8(f) of the Revolving Credit Agreement shall occur and be
continuing, and the Revolving Credit Collateral Agent shall have instructed the
Pledgor to do so, all Proceeds of Collateral received by the Pledgor consisting
of cash, checks and other Cash Equivalent items up to an amount not to exceed,
when aggregated with all other amounts so held and all other amounts paid, paid
over to or collected or otherwise received by any Agent or any Secured Creditor
at any time (upon the exercise of remedies or otherwise) pursuant to or in
connection with this Agreement, any other Restricted Assets Collateral Document
or the Pledged Collateral, the Maximum Aggregate Secured Amount, shall be held
by the Pledgor in trust for the Revolving Credit Collateral Agent and the other
Secured Parties hereto, or the Term Loan Collateral Agent and the other Secured
Parties (as defined in the Term Loan Security Agreement) or any Additional Agent
and the other applicable Additional Secured Parties (as defined in the
Intercreditor Agreement), as applicable, in accordance with the terms of the
Intercreditor Agreement, segregated from other funds of the Pledgor, and shall,
forthwith upon receipt by the Pledgor, be turned over to the Revolving Credit
Collateral Agent, or the Term Loan Collateral Agent or any Additional Agent, as
applicable, in accordance with the terms of the Intercreditor Agreement (or
their respective agents appointed for purposes of perfection), in the exact
form received by the Pledgor.  All
Proceeds of Pledged Collateral received by the Revolving Credit Collateral
Agent hereunder in an amount not to exceed, when aggregated with all other
amounts paid, paid over to or collected or otherwise received by any Agent or
any Secured Creditor at any time (upon the exercise of remedies or otherwise)
pursuant to or in connection with this Agreement, any other Restricted Assets
Collateral Document or the Pledged Collateral, the Maximum Aggregate Secured
Amount, shall be held by the Revolving Credit Collateral Agent in the relevant
Collateral Proceeds Account, in each case subject to subsection 3.2.  All such Proceeds of Pledged Collateral while
held by the Revolving Credit Collateral Agent in such Collateral Proceeds
Account (or by the Pledgor in trust for the Revolving Credit Collateral Agent
and the other Secured Parties) shall continue to be held as collateral security
for all the Obligations of the Pledgor and shall not constitute payment thereof
until applied as provided in subsection 6.2, in each case subject to subsection
3.2.


6.2                         Application
of Proceeds


It is agreed that if an Event of Default specified in
subsection 8(f) of the Revolving Credit Agreement shall occur and be continuing,
any and all Proceeds of the Pledged Collateral received by the Revolving Credit
Collateral Agent (whether from the Pledgor or otherwise) in an amount not to
exceed, when aggregated with all other amounts paid, paid over to or collected
or 



 10
 









otherwise received by any Agent or any Secured
Creditor at any time (upon the exercise of remedies or otherwise)  pursuant to or in connection with this
Agreement, any other Restricted Assets Collateral Document or the Pledged
Collateral, the Maximum Aggregate Secured Amount, shall be held by the
Revolving Credit Collateral Agent for the benefit of the Secured Parties as
collateral security for the Obligations of the Pledgor (whether matured or
unmatured), and/or then or at any time thereafter may, in the sole discretion
of the Revolving Credit Collateral Agent, be applied by the Revolving Credit
Collateral Agent against the Obligations of the Pledgor then due and owing in
the order of priority set forth in the Intercreditor Agreement, in each case
subject to subsection 3.2, with the excess, if any, to be paid over to the
Pledgor.


6.3                         Code
and Other Remedies


In each case subject to subsection 3.2, if an Event of
Default specified in subsection 8(f) of the Revolving Credit Agreement shall
occur and be continuing:


The Revolving
Credit Collateral Agent, on behalf of the Secured Parties, may exercise, in
addition to all other rights and remedies granted to them in this Agreement and
in any other instrument or agreement securing, evidencing or relating to the
Obligations to the extent permitted by applicable law, all rights and remedies
of a secured party under the Code or any other applicable law.  Without limiting the generality of the
foregoing, to the extent permitted by applicable law, the Revolving Credit
Collateral Agent, without demand of performance or other demand, presentment,
protest, advertisement or notice of any kind (except any notice required by law
referred to below) to or upon the Pledgor or any other Person (all and each of
which demands, defenses, advertisements and notices are hereby waived), may in
such circumstances, forthwith (subject to the terms of any documentation
governing any Special Purpose Financing) collect, receive, appropriate and
realize upon the Pledged Collateral, or any part thereof, and/or may forthwith,
subject to any existing reserved rights or licenses, sell, lease, assign, give
option or options to purchase, or otherwise dispose of and deliver the Pledged
Collateral or any part thereof (or contract to do any of the foregoing), in one
or more parcels at public or private sale or sales, at any exchange, broker’s
board or office of the Revolving Credit Collateral Agent or any other Secured
Party or elsewhere upon such terms and conditions as it may deem advisable and
at such prices as it may deem best, for cash or on credit or for future
delivery without assumption of any credit risk. 
The Revolving Credit Collateral Agent or any other Secured Party shall
have the right, to the extent permitted by law, upon any such sale or sales, to
purchase the whole or any part of the Pledged Collateral so sold, free of any
right or equity of redemption in the Pledgor, which right or equity is hereby
waived and released.  The Pledgor further
agrees, at the Revolving Credit Collateral Agent’s request (subject to the
terms of any documentation governing any Special Purpose Financing), to
assemble the Pledged Collateral and make it available to the Revolving Credit
Collateral Agent at places which the Revolving Credit Collateral Agent shall
reasonably select, whether at the Pledgor’s premises or elsewhere.  The Revolving Credit Collateral Agent shall
apply the proceeds of any action taken by it pursuant to this subsection 6.3 up
to an amount not to exceed, when aggregated with all other amounts paid, paid
over to or collected or otherwise received by any Agent or any Secured Creditor
at any time (upon the exercise of remedies or otherwise) pursuant to or in
connection 



 11
 









with this Agreement, any
other Restricted Assets Collateral Document or the Pledged Collateral, the
Maximum Aggregate Secured Amount, to all reasonable costs and expenses of every
kind incurred in connection therewith or incidental to the care or safekeeping
of any of the Pledged Collateral or in any way relating to the Pledged
Collateral or the rights of the Revolving Credit Collateral Agent and the other
Secured Parties hereunder, including, without limitation, reasonable attorneys’
fees and disbursements, and then to the payment in whole or in part of the
Obligations of the Pledgor then due and owing, in the order of priority
specified in subsection 6.2 above, and only after such application and after
the payment by the Revolving Credit Collateral Agent of any other amount
required by any provision of law, including, without limitation, Section 9-615(a)(3)
of the Code, need the Revolving Credit Collateral Agent account for the surplus,
if any, to the Pledgor.  To the extent
permitted by applicable law, (i) the Pledgor waives all claims, damages and
demands it may acquire against the Revolving Credit Collateral Agent or any
other Secured Party arising out of the repossession, retention or sale of the
Pledged Collateral, other than any such claims, damages and demands that may
arise from the gross negligence or willful misconduct of any of the Revolving
Credit Collateral Agent or such other Secured Party, and (ii) if any notice of
a proposed sale or other disposition of the Pledged Collateral shall be
required by law, such notice shall be deemed reasonable and proper if given at
least 10 days before such sale or other disposition.


6.4                         Excess
Paid Over


If at any time the Administrative Agent, the Revolving
Credit Collateral Agent or any other Secured Party is paid, or collects or
receives, at any time (upon the exercise of remedies or otherwise) an amount
that exceeds, when aggregated with all other amounts paid, paid over to or
collected or otherwise received by any Agent or any Secured Creditor at any
time (upon the exercise of remedies or otherwise) pursuant to or in connection
with this Agreement, any other Restricted Assets Collateral Document or the
Pledged Collateral, the Maximum Aggregate Secured Amount, such Agent or such
Secured Party, as the case may be, shall promptly deliver such excess to the
Parent Borrower, for the benefit of the Pledgor.


SECTION 7     THE
COLLATERAL AGENT


7.1                         Collateral
Agent’s Appointment as Attorney-in-Fact, etc.


(a)                                  The Pledgor hereby irrevocably
constitutes and appoints the Revolving Credit Collateral Agent and any
authorized officer or agent thereof, with full power of substitution, as its
true and lawful attorney-in-fact with full irrevocable power and authority in
the place and stead of the Pledgor and in the name of the Pledgor or in its own
name, for the purpose of carrying out the terms of this Agreement, to take any
and all appropriate action and to execute any and all documents and instruments
that may be reasonably necessary or desirable to accomplish the purposes of
this Agreement to the extent permitted by applicable law, subject to subsection
3.2, provided that the Revolving Credit Collateral Agent agrees not to
exercise such power except upon the occurrence and during the continuance of an
Event of Default specified in subsection 8(f) of the Revolving Credit
Agreement.  Without limiting the
generality of the foregoing, at any time when an Event of Default specified in
subsection 8(f) of the Revolving Credit Agreement 



 12
 









has occurred and is continuing (in each case to the extent permitted by
applicable law), subject to subsection 3.2, (x) the Pledgor hereby gives the
Revolving Credit Collateral Agent the power and right, on behalf of the
Pledgor, without notice or assent by the Pledgor, to execute, in connection
with any sale provided for in subsection 6.3, any indorsements, assessments or
other instruments of conveyance or transfer with respect to the Pledged Collateral.


(b)                                 The reasonable
expenses of the Revolving Credit Collateral Agent incurred in connection with actions
undertaken as provided in this subsection 7.1, together with interest thereon
at a rate per annum equal to the rate per annum at which interest would then be
payable on past due ABR Loans, from the date of payment by the Revolving Credit
Collateral Agent to the date reimbursed by the Pledgor, shall be payable by the
Pledgor to the Revolving Credit Collateral Agent on demand.


(c)                                  The Pledgor hereby
ratifies all that said attorney shall lawfully do or cause to be done by virtue
hereof.  All powers, authorizations and
agencies contained in this Agreement are coupled with an interest and are irrevocable
as to the Pledgor until this Agreement is terminated, and the security
interests in the Pledged Collateral of the Pledgor created hereby are released.


7.2                         Duty
of Collateral Agent


The Revolving Credit Collateral Agent’s sole duty with
respect to the custody, safekeeping and physical preservation of the Pledged
Collateral in its possession, under Section 9-207 of the Code or otherwise,
shall be to deal with it in the same manner as the Revolving Credit Collateral
Agent deals with similar property for its own account.  None of the Revolving Credit Collateral
Agent, any other Secured Party nor any of their respective officers, directors,
employees or agents shall be liable for failure to demand, collect or realize
upon any of the Pledged Collateral or for any delay in doing so or shall be
under any obligation to sell or otherwise dispose of any Pledged Collateral
upon the request of the Pledgor or any other Person or, except as otherwise
provided herein, to take any other action whatsoever with regard to the Pledged
Collateral or any part thereof.  The
powers conferred on the Revolving Credit Collateral Agent and the other Secured
Parties hereunder are solely to protect the Revolving Credit Collateral Agent’s
and the other Secured Parties’ interests in the Pledged Collateral and shall
not impose any duty upon the Revolving Credit Collateral Agent or any other
Secured Party to exercise any such powers. 
The Revolving Credit Collateral Agent and the other Secured Parties
shall be accountable only for amounts that they actually receive as a result of
the exercise of such powers, and neither they nor any of their officers,
directors, employees or agents shall be responsible to the Pledgor for any act
or failure to act hereunder, except as otherwise provided herein or for their
own gross negligence or willful misconduct.


7.3                         Financing
Statements


Pursuant to any applicable law, the Pledgor authorizes
the Revolving Credit Collateral Agent to file or record financing statements
and other filing or recording documents or instruments with respect to the
Pledged Collateral without the signature of the Pledgor in such form and in
such filing offices as the Revolving Credit Collateral Agent reasonably
determines appropriate to perfect the security interests of the Revolving Credit
Collateral Agent under this Agreement. 
The Pledgor authorizes the Revolving Credit Collateral Agent to use the
collateral 



 13
 









description “all personal property” or “all assets” in
any such financing statements.  The Revolving
Credit Collateral Agent agrees to notify the Pledgor of any financing or
continuation statement filed by it; provided that any failure to give such
notice shall not affect the validity or effectiveness of any such filing.


7.4                         Authority
of Collateral Agent


The Pledgor acknowledges that the rights and
responsibilities of the Revolving Credit Collateral Agent under this Agreement
with respect to any action taken by the Revolving Credit Collateral Agent or
the exercise or non-exercise by the Revolving Credit Collateral Agent of any option,
voting right, request, judgment or other right or remedy provided for herein or
resulting or arising out of this Agreement or any amendment, supplement or
other modification of this Agreement shall, as between the Revolving Credit
Collateral Agent and the Secured Parties, be governed by the Revolving Credit
Agreement and by such other agreements with respect thereto as may exist from
time to time among them, but, as between the Revolving Credit Collateral Agent
and the Pledgor, the Revolving Credit Collateral Agent shall be conclusively presumed
to be acting as agent for the Secured Parties with full and valid authority so
to act or refrain from acting, and the Pledgor shall not shall be under any
obligation, or entitlement, to make any inquiry respecting such authority.


SECTION 8     NON-LENDER
SECURED PARTIES


8.1                         Rights
to Collateral


(a)                                  The Non-Lender
Secured Parties shall not have any right whatsoever to do any of the following:  (i) exercise any rights or remedies with
respect to the Collateral (such term, as used in this Section 8, having the
meaning assigned to it in the Revolving Credit Agreement), including, without
limitation, the right to (A) enforce any Liens or sell or otherwise foreclose
on any portion of the Collateral, (B) request any action, institute any
proceedings, exercise any voting rights, give any instructions, make any election,
notice account debtors or make collections with respect to all or any portion
of the Collateral or (C) release any Collateral from the Liens of any Security
Document or consent to or otherwise approve any such release; (ii) demand,
accept or obtain any Lien on any Collateral (except for Liens arising under,
and subject to the terms of, this Agreement); (iii) vote in any Bankruptcy Case
or similar proceeding in respect of Holding 
or any of its Subsidiaries (any such proceeding, for purposes of this
clause (a), a “Bankruptcy”) with respect to, or take any other actions
concerning, the Collateral; (iv) receive any proceeds from any sale, transfer
or other disposition of any of the Collateral (except in accordance with this
Agreement); (v) oppose any sale, transfer or other disposition of the Collateral;
(vi) object to any debtor-in-possession financing in any Bankruptcy which is provided
by one or more Lenders among others (including on a priming basis under Section
364(d) of the Bankruptcy Code); (vii) object to the use of cash collateral in
respect of the Collateral in any Bankruptcy; or (viii) seek, or object to the
Lenders seeking on an equal and ratable basis, any adequate protection or
relief from the automatic stay with respect to the Collateral in any Bankruptcy.


(b)                                 Each Non-Lender
Secured Party, by its acceptance of the benefits of this Agreement and the
other Security Documents, agrees that in exercising rights and remedies with respect
to the Collateral, the Revolving Credit Collateral Agent and the Lenders, with
the consent 



 14
 









of the Revolving Credit Collateral Agent, may enforce the provisions of
the Security Documents and exercise remedies thereunder and under any other
Loan Documents (or refrain from enforcing rights and exercising remedies), all
in such order and in such manner as they may determine in the exercise of their
sole business judgment.  Such exercise
and enforcement shall include, without limitation, the rights to collect, sell,
dispose of or otherwise realize upon all or any part of the Collateral, to
incur expenses in connection with such collection, sale, disposition or other
realization and to exercise all the rights and remedies of a secured lender
under the Uniform Commercial Code of any applicable jurisdiction.  The Non-Lender Secured Parties by their acceptance
of the benefits of this Agreement and the other Security Documents hereby agree
not to contest or otherwise challenge any such collection, sale, disposition or
other realization of or upon all or any of the Collateral.  Whether or not a Bankruptcy Case has been
commenced, the Non-Lender Secured Parties shall be deemed to have consented to
any sale or other disposition of any property, business or assets of Holding or
any of its Subsidiaries and the release of any or all of the Collateral from
the Liens of any Security Document in connection therewith.


(c)                                  Notwithstanding any
provision of this subsection 8.1, the Non-Lender Secured Parties shall be
entitled to file any necessary responsive or defensive pleadings in opposition
to any motion, claim, adversary proceeding or other pleadings (A) in order to
prevent any Person from seeking to foreclose on the Collateral or supersede the
Non-Lender Secured Parties’ claim thereto or (B) in opposition to any motion,
claim, adversary proceeding or other pleading made by any Person objecting to
or otherwise seeking the disallowance of the claims of the Non-Lender Secured
Parties.


(d)                                 Each Non-Lender
Secured Party, by its acceptance of the benefit of this Agreement, agrees that
the Revolving Credit Collateral Agent and the Lenders may deal with the Collateral,
including any exchange, taking or release of Collateral, may change or increase
the amount of the Borrower Obligations and/or the Guarantor Obligations (as
defined in the Guarantee and Collateral Agreement), and may release the Pledgor
from its Obligations hereunder, all without any liability or obligation (except
as may be otherwise expressly provided herein) to the Non-Lender Secured Parties.


8.2                         Appointment
of Agent


Each Non-Lender Secured Party, by its acceptance of
the benefits of this Agreement and the other Security Documents, shall be
deemed irrevocably to make, constitute and appoint the Revolving Credit
Collateral Agent, as agent under the Revolving Credit Agreement (and all officers,
employees or agents designated by the Revolving Credit Collateral Agent) as
such Person’s true and lawful agent and attorney-in-fact, and in such capacity,
the Revolving Credit Collateral Agent shall have the right, with power of
substitution for the Non-Lender Secured Parties and in each such Person’s name
or otherwise, to effectuate any sale, transfer or other disposition of the
Collateral.  It is understood and agreed
that the appointment of the Revolving Credit Collateral Agent as the agent and
attorney-in-fact of the Non-Lender Secured Parties for the purposes set forth
herein is coupled with an interest and is irrevocable.  It is understood and agreed that the
Revolving Credit Collateral Agent has appointed the Administrative Agent as its
agent for purposes of perfecting certain of the security interests created
hereunder and for otherwise carrying out certain of its obligations hereunder.



 15
 









8.3                         Waiver
of Claims


To the maximum extent permitted by law, each
Non-Lender Secured Party waives any claim it might have against the Revolving
Credit Collateral Agent or the Lenders with respect to, or arising out of, any
action or failure to act or any error of judgment, negligence, or mistake or
oversight whatsoever on the part of the Revolving Credit Collateral Agent or
the Lenders or their respective directors, officers, employees or agents with
respect to any exercise of rights or remedies under the Loan Documents or any
transaction relating to the Collateral (including, without limitation, any such
exercise described in subsection 8.1(b) above), except for any such action or
failure to act which constitutes willful misconduct or gross negligence of such
Person.  None of the Revolving Credit
Collateral Agent or any Lender or any of their respective directors, officers,
employees or agents shall be liable for failure to demand, collect or realize
upon any of the Collateral or for any delay in doing so or shall be under any
obligation to sell or otherwise dispose of any Collateral upon the request of
Holding, any Subsidiary of Holding, any Non-Lender Secured Party or any other
Person or to take any other action or forbear from doing so whatsoever with
regard to the Collateral or any part thereof, except for any such action or
failure to act which constitutes willful misconduct or gross negligence of such
Person.


SECTION 9     MISCELLANEOUS


9.1                         Amendments
in Writing


None of the terms or provisions of this Agreement may
be waived, amended, supplemented or otherwise modified except by a written
instrument executed by the Pledgor and the Revolving Credit Collateral Agent;
provided that (a) any provision of this Agreement imposing obligations on the
Pledgor may be waived by the Revolving Credit Collateral Agent in a written
instrument executed by the Revolving Credit Collateral Agent and (b)
notwithstanding anything to the contrary in subsection 10.1 of the Revolving
Credit Agreement, no such waiver and no such amendment or modification shall
amend, modify or waive the definition of “Secured Party” or subsection 6.2 if
such waiver, amendment, or modification would adversely affect a Secured Party
without the written consent of each such affected Secured Party.  For the avoidance of doubt, it is understood
and agreed that any amendment, amendment and restatement, waiver, supplement or
other modification of or to the Intercreditor Agreement that would have the
effect, directly or indirectly, through any reference herein to the
Intercreditor Agreement or otherwise, of waiving, amending, supplementing or
otherwise modifying this Agreement, or any term or provision hereof, or any
right or obligation of the Pledgor hereunder or in respect hereof, shall not be
given such effect except pursuant to a written instrument executed by the
Pledgor and the Revolving Credit Collateral Agent in accordance with this subsection
9.1.


9.2                         Notices


All notices, requests and demands to or upon the
Revolving Credit Collateral Agent or the Pledgor hereunder shall be effected in
the manner provided for in subsection 10.2 of the Revolving Credit Agreement;
provided that any such notice, request or demand to or upon the Pledgor shall
be addressed to the Pledgor at its notice address set forth on Schedule 1,
unless and until the Pledgor shall change such address by notice to the
Revolving Credit Collateral Agent 



 16
 









and the Administrative Agent given in accordance with
subsection 10.2 of the Revolving Credit Agreement.


9.3                         No
Waiver by Course of Conduct; Cumulative Remedies


None of the Revolving Credit Collateral Agent or any
other Secured Party shall by any act (except by a written instrument pursuant
to subsection 9.1), delay, indulgence, omission or otherwise be deemed to have
waived any right or remedy hereunder or to have acquiesced in any Default or
Event of Default.  No failure to
exercise, nor any delay in exercising, on the part of the Revolving Credit
Collateral Agent or any other Secured Party, any right, power or privilege
hereunder shall operate as a waiver thereof. 
No single or partial exercise of any right, power or privilege hereunder
shall preclude any other or further exercise thereof or the exercise of any
other right, power or privilege.  A
waiver by the Revolving Credit Collateral Agent or any other Secured Party of
any right or remedy hereunder on any one occasion shall not be construed as a
bar to any right or remedy which the Revolving Credit Collateral Agent or such
other Secured Party would otherwise have on any future occasion.  The rights and remedies herein provided are
cumulative, may be exercised singly or concurrently and are not exclusive of
any other rights or remedies provided by law.


9.4                         Indemnification


Each Grantor jointly and severally agrees to pay, and
to save the Revolving Credit Collateral Agent, the Administrative Agent and the
other Secured Parties harmless from, (x) any and all liabilities with respect
to, or resulting from any delay in paying, any and all stamp, excise, sales or
other similar taxes which may be payable or determined to be payable with
respect to any of the Pledged Collateral or in connection with any of the
transactions contemplated by this Agreement and (y) any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever with respect to the
execution, delivery, enforcement, performance and administration of this
Agreement (collectively, the “indemnified liabilities”), in each case to
the extent the Parent Borrower would be required to do so pursuant to
subsection 10.5 of the Revolving Credit Agreement, and in any event excluding
any taxes or other indemnified liabilities arising from gross negligence, bad
faith or willful misconduct of the Revolving Credit Collateral Agent, the
Administrative Agent or any other Secured Party.  The agreements in this subsection 9.4 shall
survive repayment of the obligations and all other amounts payable under the
Revolving Credit Agreement and the other Loan Documents.


9.5                         Successors
and Assigns


This Agreement shall be binding upon and shall inure
to the benefit of the Pledgor, the Revolving Credit Collateral Agent and the
Secured Parties and their respective successors and assigns; provided that the
Pledgor may not assign, transfer or delegate any of its rights or obligations under
this Agreement without the prior written consent of the Revolving Credit
Collateral Agent.



 17
 









9.6                         Counterparts


This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts, and all of
said counterparts taken together shall be deemed to constitute one and the same
instrument.


9.7                         [Reserved]


9.8                         Severability


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


9.9                         Section
Headings


The Section headings used in this Agreement are for
convenience of reference only and are not to affect the construction hereof or
be taken into consideration in the interpretation hereof.


9.10                   Integration


This Agreement and the other Loan Documents represent
the entire agreement of the Pledgor, the Revolving Credit Collateral Agent, the
Administrative Agent and the other Secured Parties with respect to the subject
matter hereof, and there are no promises, undertakings, representations or
warranties by the Pledgor, the Revolving Credit Collateral Agent or any other Secured
Party relative to subject matter hereof not expressly set forth or referred to
herein or in the other Loan Documents.


9.11                   GOVERNING
LAW


THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.


9.12                   Submission
to Jurisdiction; Waivers


Each party hereto hereby irrevocably and
unconditionally:


(a)                                  submits for itself
and its property in any legal action or proceeding relating to this Agreement
and the other Loan Documents to which it is a party, or for recognition and
enforcement of any judgment in respect thereof, to the non-exclusive
general jurisdiction of the courts of the State of New York, the courts of the
United States of America for the Southern District of New York, and
appellate courts from any thereof;


(b)                                 consents that any such
action or proceeding may be brought in such courts and waives any objection
that it may now or hereafter have to the venue of any such action or 



 18
 









proceeding in any such court or that such action or proceeding was
brought in an inconvenient court and agrees not to plead or claim the same;


(c)                                  agrees that service
of process in any such action or proceeding may be effected by mailing a copy
thereof by registered or certified mail (or any substantially similar form of
mail), postage prepaid, to such party at its address referred to in subsection
9.2 or at such other address of which the Revolving Credit Collateral Agent and
the Administrative Agent (in the case of any other party hereto) or the Parent
Borrower (in the case of the Revolving Credit Collateral Agent and the
Administrative Agent) shall have been notified pursuant thereto;


(d)                                 agrees that nothing
herein shall affect the right to effect service of process in any other manner
permitted by law or shall limit the right to sue in any other jurisdiction; and


(e)                                  waives, to the
maximum extent not prohibited by law, any right it may have to claim or recover
in any legal action or proceeding referred to in this Section any punitive damages.


9.13                   Acknowledgments


The Pledgor hereby acknowledges that:


(a)                                  it has been advised
by counsel in the negotiation, execution and delivery of this Agreement and the
other Loan Documents to which it is a party;


(b)                                 none of the Revolving
Credit Collateral Agent, the Administrative Agent or any other Secured Party
has any fiduciary relationship with or duty to any Guarantor arising out of or
in connection with this Agreement or any of the other Loan Documents, and the
relationship between the Guarantors, on the one hand, and the Revolving Credit
Collateral Agent, the Administrative Agent and the other Secured Parties, on
the other hand, in connection herewith or therewith is solely that of debtor
and creditor; and


(c)                                  no joint venture is
created hereby or by the other Loan Documents or otherwise exists by virtue of
the transactions contemplated hereby among the Secured Parties or among the
Guarantors and the Secured Parties.


9.14                   WAIVER OF
JURY TRIAL


EACH PARTY HERETO HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING
TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY COUNTERCLAIM THEREIN.


9.15                   Additional Pledgors.  In the event that the Pledgor is required or
requested to furnish additional or substitute Pledged Collateral pursuant to
Section 5.2(b), the Parent Borrower shall have the right, at its election, to
cause another Subsidiary (in lieu of the Pledgor) to enter into a Security
Agreement, in a form substantially identical to this Security Agreement (with
such changes as shall be reasonably satisfactory to the Revolving Credit
Collateral Agent 



 19
 









pledging a promissory note of an obligor
Subsidiary reasonably satisfactory to the Revolving Credit Collateral Agent
(or, if the new pledgor so elects, causing to be deposited an amount in the “Collateral
Proceeds Account” maintained under such Security Agreement) such that, after
giving effect to such pledge (or deposit) and (if applicable) substitution, the
outstanding principal amount of the new pledgor’s “Pledged Note” plus the
amount, if any, on deposit in its “Collateral Proceeds Account” will, when
added to the outstanding principal amount of the Pledged Note plus the amount,
if any, on deposit in the Collateral Proceeds Account constituting Pledged
Collateral hereunder plus the amount, if any, on deposit in any Secured
Creditor Collateral Account, be equal to $100,000,000.  In the event that the Parent Borrower elects
to exercise such election, it shall promptly deliver notice of such election in
writing to the Revolving Credit Collateral Agent and the Pledgor hereunder, and
upon compliance with the foregoing requirements, Pledgor shall be relieved of
any further obligation to furnish additional or substitute Pledged Collateral
under Section 5.2(b).


9.16                   Releases


(a)                                  At such time as the
Loans and the other Obligations (other than any Obligations owing to a
Non-Lender Secured Party) then due and owing shall have been paid in full and
the Revolving Commitments have been terminated and no Letter of Credit shall be
outstanding (except for Letters of Credit that have been cash collateralized in
a manner reasonably satisfactory to the Issuing Bank), all Pledged Collateral
shall be automatically released from the Liens created hereby, and this
Agreement and all obligations (other than those expressly stated to survive
such termination) of the Revolving Credit Collateral Agent and the Pledgor
hereunder shall terminate, all without delivery of any instrument or performance
of any act by any party, and all rights to the Pledged Collateral shall revert
to the Pledgor.  At the request and sole
expense of the Pledgor following any such termination, the Revolving Credit
Collateral Agent shall deliver to the Pledgor any Pledged Collateral held by
the Revolving Credit Collateral Agent hereunder, and the Revolving Credit
Collateral Agent and the Administrative Agent shall execute and deliver to the
Pledgor such documents (including without limitation UCC termination
statements) as the Pledgor shall reasonably request to evidence such termination.


(b)                                 In connection with any
sale or other disposition of all of the Capital Stock of the Pledgor (other
than to the Parent Borrower or a Restricted Subsidiary) permitted under the Revolving
Credit Agreement, the Revolving Credit Collateral Agent shall, upon receipt
from the Parent Borrower of a written request for the release of the Pledged
Collateral subject to such sale or other disposition, identifying the terms of
the sale or other disposition in reasonable detail, including the price thereof
and any expenses in connection therewith, together with a certification by the
Parent Borrower stating that such transaction is in compliance with the
Revolving Credit Agreement and the other Loan Documents, deliver to the Parent
Borrower or the Pledgor any of the Pledged Collateral held by the Revolving
Credit Collateral Agent hereunder and the Revolving Credit Collateral Agent and
the Administrative Agent shall execute and deliver to the Pledgor (at the sole
cost and expense of the Pledgor) all releases or other documents (including
without limitation UCC termination statements) necessary or reasonably
desirable for the release of the Liens created hereby on the Pledged
Collateral, as applicable, as the Pledgor may reasonably request.



 20
 









(c)                                  Upon the designation
of the Pledgor as an Unrestricted Subsidiary in accordance with the provisions
of the Revolving Credit Agreement, the Lien pursuant to this Agreement on all
Pledged Collateral of the Pledgor shall be automatically released, and all
obligations of the Pledgor hereunder shall terminate, all without delivery of
any instrument or performance of any act by any party and the Revolving Credit
Collateral Agent shall, upon the request of the Parent Borrower, deliver to the
Pledgor any Pledged Collateral held by the Revolving Credit Collateral Agent
hereunder and the Revolving Credit Collateral Agent and the Administrative
Agent shall execute and deliver the Pledgor (at the sole cost and expense of
the Pledgor) all releases or other documents (including without limitation UCC
termination statements) necessary or reasonably desirable for the release of
the Liens created hereby on the Pledged Collateral as the Pledgor may
reasonably request.


(d)                                 If at any time any
Agent or any other Secured Party is paid, or collects or receives, at any time
(upon the exercise of remedies or otherwise) an amount that exceeds, when
aggregated with all other amounts paid, paid over to or collected or otherwise
received by any Agent or any Secured Creditor at any time (upon the exercise of
remedies or otherwise) pursuant to or in connection with this Agreement, any other
Restricted Assets Collateral Document or the Pledged Collateral, the Maximum
Aggregate Secured Amount, all Pledged Collateral shall be automatically
released from the Liens created hereby, and this Agreement and all obligations
(other than those expressly stated to survive such termination) of the
Revolving Credit Collateral Agent and the Pledgor hereunder shall terminate,
all without delivery of any instrument or performance of any act by any party,
and all rights to the Pledged Collateral shall revert to the Pledgor, provided
that (i) the foregoing release and termination shall not occur if the Existing
Indenture ceases to be in full force and effect as a result of the satisfaction
and discharge thereof in accordance with its terms and (ii) the foregoing
release and termination shall not occur if the Pledgor shall have granted a
Lien to any Person on the Pledged Collateral resulting in the Existing Notes
being equally and ratably secured by the Pledged Collateral pursuant to Section
5.03 of the Existing Notes Indenture, for so long as the Existing Notes are so
equally and ratably secured.  At the
request and sole expense of the Pledgor following any such termination, the Revolving
Credit Collateral Agent shall deliver to the Pledgor any Pledged Collateral
held by the Revolving Credit Collateral Agent hereunder, and the Revolving
Credit Collateral Agent and the Administrative Agent shall execute and deliver
to the Pledgor such documents (including without limitation UCC termination
statements or amendments to financing statements in form and substance
reasonably satisfactory to the Pledgor) as the Pledgor shall reasonably request
to evidence such termination.


9.17                   Judgment


(a)                                  If for the purpose of
obtaining judgment in any court it is necessary to convert a sum due hereunder
in one currency into another currency, the parties hereto agree, to the fullest
extent that they may effectively do so, that the rate of exchange used shall be
that at which in accordance with normal banking procedures the Revolving Credit
Collateral Agent could purchase the first currency with such other currency on
the Business Day preceding the day on which final judgment is given.



 21
 









[Remainder
of page left blank intentionally; Signature pages follow.]



 22















IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be duly executed, all as of the
date first written above.


	
   

  	
  SERVICEMASTER CONSUMER SERVICES

  
	
   

  	
  LIMITED PARTNERSHIP

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  SERVICEMASTER CONSUMER SERVICES,

  
	
   

  	
   

  	
   

  	
  INC., its general partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Ernest J. Mrozek

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
  Ernest J. Mrozek

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
  President & Chief Operating

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Eric Zarnikow

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
  Eric Zarnikow

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
  Treasurer

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  THE SERVICEMASTER COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Ernest J. Mrozek

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
  Ernest J. Mrozek

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
  Chief Financial Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Eric Zarnikow

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
   

  	
  Eric Zarnikow

  
	
   

  	
   

  	
   

  	
  Title:

  	
   

  	
  Senior Vice President & Treasurer

  
									



 













Acknowledged and
Agreed to as of


the date hereof by:



CITIBANK, N.A.,

as Administrative Agent and Collateral Agent


	
  By:

  	
  /s/ Edward T. Crook

  	
   

  
	
   

  	
  Name: Edward T. Crook

  
	
   

  	
  Title: Managing Director

  



 



 2