Exhibit 10.8


 


EXECUTION COPY


 




 





FIRST LIEN GUARANTEE AND
COLLATERAL AGREEMENT


 


dated as of


 


June 15, 2007


 


among


 


STR ACQUISITION, INC.,


 


STR HOLDINGS LLC,


 


the Subsidiaries of the
Borrower 

from time to time party hereto


 


and


 


CREDIT SUISSE,


as Collateral Agent




 





[CS&M Ref. No. 5865-531]


 

















 


TABLE OF CONTENTS


 


	
   

  	
   

  	
  Page

  
	
   

  
	
  ARTICLE I

  
	
   

  
	
  Definitions

  
	
   

  
	
  SECTION 1.01.

  	
  Credit Agreement

  	
  1

  
	
  SECTION 1.02.

  	
  Other Defined Terms

  	
  2

  
	
   

  
	
  ARTICLE II

  
	
   

  
	
  Guarantee

  
	
   

  
	
  SECTION 2.01.

  	
  Guarantee

  	
  6

  
	
  SECTION 2.02.

  	
  Guarantee of Payment

  	
  6

  
	
  SECTION 2.03.

  	
  No Limitations, Etc

  	
  7

  
	
  SECTION 2.04.

  	
  Reinstatement

  	
  8

  
	
  SECTION 2.05.

  	
  Agreement To Pay; Subrogation

  	
  8

  
	
  SECTION 2.06.

  	
  Information

  	
  8

  
	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
   

  
	
   

  	
   

  
	
  Pledge of Securities

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 3.01. 

  	
  Pledge

  	
  9

  
	
  SECTION 3.02. 

  	
  Delivery of the Pledged Collateral

  	
  9

  
	
  SECTION 3.03. 

  	
  Representations, Warranties and Covenants

  	
  10

  
	
  SECTION 3.04. 

  	
  Certification of Limited Liability Company Interests
  and Limited Partnership Interests

  	
  11

  
	
  SECTION 3.05.

  	
  Registration in Nominee Name; Denominations

  	
  11

  
	
  SECTION 3.06.

  	
  Voting Rights; Dividends and Interest, Etc

  	
  12

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
   

  
	
   

  	
   

  
	
  Security Interests in
  Personal Property

  	
   

  
	
   

  	
   

  	
   

  
	
  SECTION 4.01.

  	
  Security Interest

  	
  14

  
	
  SECTION 4.02.

  	
  Representations and Warranties

  	
  15

  
	
  SECTION 4.03.

  	
  Covenants

  	
  17

  
	
  SECTION 4.04.

  	
  Other Actions

  	
  20

  
	
  SECTION 4.05.

  	
  Covenants Regarding Patent, Trademark and Copyright
  Collateral

  	
  23

  



 

















 


	
  ARTICLE V

  
	
   

  	
   

  	
   

  
	
  Remedies

  
	
   

  	
   

  	
   

  
	
  SECTION 5.01.

  	
  Remedies Upon Default

  	
  25

  
	
  SECTION 5.02.

  	
  Application of Proceeds

  	
  26

  
	
  SECTION 5.03.

  	
  Grant of License to Use
  Intellectual Property

  	
  27

  
	
  SECTION 5.04.

  	
  Securities Act, Etc

  	
  27

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI

  
	
   

  	
   

  	
   

  
	
  Indemnity, Subrogation
  and Subordination

  
	
   

  	
   

  	
   

  
	
  SECTION 6.01. 

  	
  Indemnity and
  Subrogation

  	
  28

  
	
  SECTION 6.02.

  	
  Contribution and
  Subrogation

  	
  29

  
	
  SECTION 6.03. 

  	
  Subordination

  	
  29

  
	
   

  	
   

  	
   

  



ARTICLE VII


 


Miscellaneous


 


	
  SECTION 7.01.

  	
  Notices

  	
  29

  
	
  SECTION 7.02.

  	
  Security Interest
  Absolute

  	
  30

  
	
  SECTION 7.03.

  	
  Survival of Agreement

  	
  30

  
	
  SECTION 7.04.

  	
  Binding Effect; Several
  Agreement

  	
  30

  
	
  SECTION 7.05.

  	
  Successors and Assigns

  	
  30

  
	
  SECTION 7.06.

  	
  Collateral Agent’s Fees
  and Expenses; Indemnification

  	
  31

  
	
  SECTION 7.07.

  	
  Collateral Agent
  Appointed Attorney-in-Fact

  	
  31

  
	
  SECTION 7.08.

  	
  Applicable Law

  	
  32

  
	
  SECTION 7.09.

  	
  Waivers; Amendment

  	
  32

  
	
  SECTION 7.10.

  	
  WAIVER OF JURY TRIAL

  	
  33

  
	
  SECTION 7.11.

  	
  Severability

  	
  33

  
	
  SECTION 7.12.

  	
  Counterparts

  	
  33

  
	
  SECTION 7.13.

  	
  Headings

  	
  33

  
	
  SECTION 7.14.

  	
  Jurisdiction; Consent
  to Service of Process

  	
  34

  
	
  SECTION 7.15.

  	
  Termination or Release

  	
  34

  
	
  SECTION 7.16.

  	
  Additional Subsidiaries

  	
  35

  
	
  SECTION 7.17.

  	
  Right of Setoff

  	
  35

  



 


ii

















 


Schedules


	
   

  	
   

  	
   

  
	
  Schedule I

  	
  Subsidiary Guarantors

  	
   

  
	
  Schedule II

  	
  Equity Interests;
  Pledged Debt Securities

  	
   

  
	
  Schedule III

  	
  Intellectual Property

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibits

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Exhibit A

  	
  Form of Supplement

  	
   

  
	
  Exhibit B

  	
  Form of Perfection
  Certificate

  	
   

  



 


iii

















 


FIRST LIEN GUARANTEE AND COLLATERAL AGREEMENT dated as
of June 15, 2007 (this “Agreement”), among
STR ACQUISITION, INC., a Delaware corporation, which substantially
simultaneously with the execution hereof shall be merged with and into SPECIALIZED
TECHNOLOGY RESOURCES, INC., a Delaware corporation (“STR”), with STR being the surviving
entity (the “Borrower”), STR
HOLDINGS LLC, a Delaware limited liability company (“Holdings”), the Subsidiaries of the Borrower
from time to time party hereto and CREDIT SUISSE (“Credit Suisse”),  as collateral agent (in such
capacity, the “Collateral Agent”).


 


PRELIMINARY STATEMENT


 


Reference is made
to the First Lien Credit Agreement dated as of June 15, 2007 (as amended,
supplemented or otherwise modified from time to time, the “Credit Agreement”), among the
Borrower, Holdings, the lenders from time to time party thereto (the “Lenders”)  and Credit Suisse,  as 
administrative agent (in such capacity, the “Administrative Agent”)  and Collateral
Agent.


 


The Lenders and
the Issuing Bank (such term and each other capitalized term used but not
defined in this preliminary statement having the meaning given or ascribed to
it in Article I) have agreed to extend credit to the Borrower pursuant to,
and upon the terms and conditions specified in, the Credit Agreement. The
obligations of the Lenders and the Issuing Bank to extend credit to the
Borrower are conditioned upon, among other things, the execution and delivery
of this Agreement by the Borrower and each Guarantor. Each Guarantor is an
affiliate of the Borrower, will derive substantial benefits from the extension
of credit to the Borrower pursuant to the Credit Agreement and is willing to
execute and deliver this Agreement in order to induce the Lenders and the
Issuing Bank to extend such credit. Accordingly, the parties hereto agree as
follows:


 


ARTICLE I 


 


Definitions


 


SECTION 1.01.
Credit Agreement. (a) Capitalized terms used in this
Agreement and not otherwise defined herein have the meanings set forth in the
Credit Agreement. All capitalized terms defined in the New York UCC (as such
term is defined herein) and not defined in this Agreement have the meanings
specified therein. All references to the Uniform Commercial Code shall mean the
New York UCC.


 


(b) The rules 
of construction specified in Section 1.02 
of the Credit Agreement also apply to this Agreement.


 

















 


SECTION 1.02.
Other Defined Terms. As used in this Agreement, the following
terms have the meanings specified below:


 


“Accounts Receivable”  shall mean all Accounts and all right,
title and interest in any returned goods, together with all rights, titles,
securities and guarantees with respect thereto, including any rights to stoppage in
transit, replevin, reclamation and resales, and all related security interests,
liens and pledges, whether voluntary or involuntary, in each case whether now
existing or owned or hereafter arising or acquired.


 


“Administrative Agent”  shall have the meaning assigned to such
term in the preliminary statement.


 


“Article 9 Collateral”
shall have the meaning assigned to such term in Section 4.01.


 


“Assignment of
Distributions” shall mean the assignment of distribution
substantially in the form of Exhibit C.


 


“Borrower” shall have the meaning
assigned to such term in the preamble.


 


“Collateral”  shall mean the Article 9 Collateral and the Pledged
Collateral.


 


“Collateral Agent”  shall have the meaning assigned to such
term in the preamble.


 


“Copyright License”  shall mean any written agreement, now or
hereafter in effect, granting any right to any third person under any copyright
now or hereafter owned by any Grantor or that such Grantor otherwise has the
right to license, or granting any right to any Grantor under any copyright now
or hereafter owned by any third person, and all rights of such Grantor under
any such agreement.


 


“Copyrights” shall mean all of the
following now owned or hereafter acquired by any Grantor: (a) all
copyright rights in any work subject to the copyright laws of the United States
or any other country, whether as author, assignee, transferee or otherwise, and
(b) all registrations and applications for registration of any such
copyright in the United States or any other country, including registrations,
recordings, supplemental registrations and pending applications for
registration in the United States Copyright Office (or any successor office or
any similar office in any other country), including those listed on Schedule
III.


 


“Excluded Assets” shall mean (a) any
lease, license, contract, property right or agreement to which any Grantor is a
party or any of its rights or interests thereunder if and only for so long as
the grant of a security interest hereunder shall constitute or result in a
breach, termination or default under any such lease, license, contract,
property right or agreement (other than to 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 of any relevant jurisdiction or any other applicable law or principles
of equity); provided,


 


2

















 


however, that any portion
of any such lease, license, contract, property right or agreement shall cease
to constitute an Excluded Asset pursuant to this clause at the time and to the
extent that the grant of security interest therein does not result in any of
the consequences specified above, (b) motor vehicles the perfection of a
security interest in which is excluded from the Uniform Commercial Code in the
relevant jurisdiction, (c) interests in real property, (d) any
Equity Interest in an Excluded Entity and (e) any application to register
Trademarks in the U.S. Patent and Trademark Office based upon Grantor’s “intent
to use” such Trademark (but only if the grant of security interest to such
intent-to-use Trademark violates 15 U.S.C. § 1060(a)) unless and until a “Statement
of Use” or “Amendment to Allege Use” is filed in the U.S. Patent and Trademark
Office with respect thereto, at which point the Collateral shall include, and
the security interest granted hereunder shall attach to, such application.


 


“Excluded Entity”  shall mean each of (i) STR-Registrar
LLC, (ii) CTC Asia Ltd. and (iii) Specialized Technology Resources
(India) Pvt Ltd. to the extent that the necessary governmental consents to make
a valid and enforceable pledge of 66% of its issued and outstanding stock to
the Collateral Agent have not been obtained.


 


“Federal Securities Laws”  shall have the meaning assigned to such
term in Section 5.04.


 


“General Intangibles”  shall mean all choses in action and
causes of action and all other intangible personal property of any Grantor of
every kind and nature (other than Accounts) now owned or hereafter acquired by
any Grantor, including all rights and interests in partnerships, limited
partnerships, limited liability companies and other unincorporated entities,
corporate or other business records, indemnification claims, contract rights
(including rights under leases, whether entered into as lessor or lessee,
Hedging Agreements and other agreements), Intellectual Property, goodwill,
registrations, franchises, tax refund claims and any letter of credit,
guarantee, claim, security interest or other security held by or granted to any
Grantor to secure payment by an Account Debtor of any of the Accounts.


 


“Grantors”  shall mean the Borrower and the Guarantors.


 


“Guarantors”  shall mean Holdings and the Subsidiary Guarantors.


 


“Holdings” shall have the meaning assigned to such term in the
preamble.


 


“Intellectual Property”  shall
mean all intellectual and similar property of any Grantor of every kind and
nature now owned or hereafter acquired by any Grantor, including inventions,
designs, Patents, Copyrights, Licenses, Trademarks, trade secrets, confidential
or proprietary technical and business information, know-how, show-how or other
data or information, software and databases and all embodiments or fixations
thereof and related documentation, registrations and franchises, and all
additions, improvements and accessions to, and books and records describing or
used in connection with, any of the foregoing.


 


3

















 


“License”  shall mean any Patent License, Trademark License, Copyright
License or other license or sublicense agreement relating to Intellectual
Property to which any Grantor is a party, including those listed on Schedule
III.


 


“Loan Document Obligations”  shall mean (a) the due and punctual
payment of (i) the principal of and interest (including interest accruing
during the pendency of any bankruptcy, insolvency, receivership or other
similar proceeding, regardless of whether allowed or allowable in such
proceeding) on the Loans, when and as due, whether at maturity, by
acceleration, upon one or more dates set for prepayment or otherwise, (ii) each
payment required to be made by the Borrower under the Credit Agreement in
respect of any Letter of Credit, when and as due, including payments in respect
of reimbursement of disbursements, interest thereon and obligations to provide
cash collateral, and (iii) all other monetary obligations of the Borrower
to any of the Secured Parties under the Credit Agreement and each of the other
Loan Documents, including fees, costs, expenses and indemnities, whether
primary, secondary, direct, contingent, fixed or otherwise (including monetary
obligations incurred during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), (b) the due and punctual performance of all
other obligations of the Borrower under or pursuant to the Credit Agreement and
each of the other Loan Documents, and (c) the due and punctual payment and
performance of all the obligations of each other Loan Party under or pursuant
to this Agreement and each of the other Loan Documents.


 


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


 


“Obligations” shall mean (a) the
Loan Document Obligations and (b) the due and punctual payment and performance
of all obligations of each Loan Party under each Hedging Agreement that (i) is
in effect on the Closing Date with a counterparty that is the Administrative
Agent or a Lender or an Affiliate of the Administrative Agent or a Lender as of
the Closing Date or (ii) is entered into after the Closing Date with any
counterparty that is the Administrative Agent or a Lender or an Affiliate of
the Administrative Agent or a Lender at the time such Hedging Agreement is
entered into.


 


“Patent License”  shall mean any written agreement, now or
hereafter in effect, granting to any third person any right to make, use or
sell any invention on which a patent, now or hereafter owned by any Grantor or
that any Grantor otherwise has the right to license, is in existence, or
granting to any Grantor any right to make, use or sell any invention on which a
patent, now or hereafter owned by any third person, is in existence, and all
rights of any Grantor under any such agreement.


 


“Patents”  shall mean all of the following now owned or hereafter
acquired by any Grantor: (a) all letters patent of the United States or
the equivalent thereof in any other country, all registrations and recordings
thereof, and all applications for letters patent of the United States or the
equivalent thereof in any other country, including registrations, recordings
and pending applications in the United States Patent and Trademark Office (or
any successor or any similar offices in any other country),


 


4

















 


including those
listed on Schedule III, and (b) all reissues, continuations, divisions,
continuations-in-part, renewals or extensions thereof, and the inventions
disclosed or claimed therein, including the right to make, use and/or sell the
inventions disclosed or claimed therein.


 


‘‘Perfection Certificate” shall mean
a certificate substantially in the form of Exhibit B, completed and
supplemented with the schedules and attachments contemplated thereby, and duly
executed by a Responsible Officer of the Borrower.


 


“Pledged Collateral” shall have the
meaning assigned to such term in Section 3.01.


 


“Pledged Debt Securities” shall have
the meaning assigned to such term in Section 3.01.


 


“Pledged Securities” shall mean any
promissory notes, stock certificates or other securities now or hereafter
included in the Pledged Collateral, including all certificates, instruments or
other documents representing or evidencing any Pledged Collateral.


 


“Pledged Stock” shall have the meaning
assigned to such term in Section 3.01.


 


“Secured Parties”  shall mean (a) the Lenders, (b) the
Administrative Agent, (c) the Collateral Agent, (d) any Issuing Bank,
(e) each counterparty to any Hedging Agreement with a Loan Party that
either (i) is in effect on the Closing Date if such counterparty is the
Administrative Agent, a Lender or an Affiliate of the Administrative Agent or a
Lender as of the Closing Date or (ii) is entered into after the Closing
Date if such counterparty is the Administrative Agent, a Lender or an Affiliate
of the Administrative Agent or a Lender at the time such Hedging Agreement is
entered into, (f) the beneficiaries of each indemnification obligation
undertaken by any Loan Party under any Loan Document and (g) the
successors and assigns of each of the foregoing.


 


“Security Interest”  shall have the meaning assigned to such
term in Section 4.01.


 


“Subsidiary Guarantor”  shall mean (a) the Subsidiaries
identified on Schedule I hereto as Subsidiary Guarantors and (b) each
other Subsidiary that becomes a party to this Agreement as a Subsidiary
Guarantor after the Closing Date; provided,
however, that in no event shall STR-Registrar LLC become a
Subsidiary Guarantor.


 


‘‘Trademark
License” shall mean any written agreement, now or hereafter in effect,
granting to any third person any right to use any trademark now or hereafter
owned by any Grantor or that any Grantor otherwise has the right to license, or
granting to any Grantor any right to use any trademark now or hereafter owned
by any third person, and all rights of any Grantor under any such agreement.


 


5

















 


“Trademarks”  shall mean all of the following now owned
or hereafter acquired by any Grantor: (a) all trademarks, service marks,
trade names, corporate names, company names, business names, fictitious
business names, trade styles, trade dress, logos, other source or business
identifiers, designs and general intangibles of like nature, now existing or
hereafter adopted or acquired, all registrations and recordings thereof, and all
registration and recording applications filed in connection therewith,
including registrations and registration applications in the United States
Patent and Trademark Office (or any successor office) or any similar offices in
any State of the United States or any other country or any political
subdivision thereof, and all extensions or renewals thereof, including those
listed on Schedule III, (b) all goodwill associated therewith or
symbolized thereby and (c) all other assets, rights and interests that uniquely
reflect or embody such goodwill.


 


“Unfunded Advances/Participations”  shall mean (a) with respect to the
Administrative Agent, the aggregate amount, if any (i) made available to
the Borrower on the assumption that each Lender has made its portion of the
applicable Borrowing available to the Administrative Agent as contemplated by Section 2.02(d) of
the Credit Agreement and (ii) with respect to which a corresponding amount
shall not in fact have been returned to the Administrative Agent by the Borrower
or made available to the Administrative Agent by any such Lender, (b) with
respect to the Swingline Lender, the aggregate amount, if any, of
participations in respect of any outstanding Swingline Loan that shall not have
been funded by the Revolving Facility Lenders in accordance with Section 2.22(e) of
the Credit Agreement and (c) with respect to any Issuing Bank, the
aggregate amount, if any, of participations in respect of any outstanding L/C
Disbursement that shall not have been funded by the Revolving Facility Lenders
in accordance with Sections 2.23(d) and 2.02(f) of the Credit
Agreement.


 


ARTICLE II 


 


Guarantee


 


SECTION 2.01.
Guarantee.  Each Guarantor unconditionally
guarantees, jointly with the other Guarantors and severally, as a primary
obligor and not merely as a surety, the due and punctual payment and
performance of the Obligations. Each Guarantor further agrees that the
Obligations may be extended or renewed, in whole or in part, without notice to
or further assent from it, and that it will remain bound upon its guarantee
notwithstanding any extension or renewal of any Obligation for the ratable
benefit of the Secured Parties. Each Guarantor waives presentment to, demand of
payment from and protest to the Borrower or any other Loan Party of any
Obligation, and also waives notice of acceptance of its guarantee and notice of
protest for nonpayment.


 


SECTION 2.02.  Guarantee of Payment.  Each Guarantor further agrees that its
guarantee hereunder constitutes a guarantee of payment when due and not of collection,
and waives any right to require that any resort be had by the Collateral Agent
or any other Secured Party to any security held for the payment of the
Obligations or to


 


6

















 


any balance of any Deposit
Account or credit on the books of the Collateral Agent or any other Secured
Party in favor of the Borrower or any other person.


 


SECTION 2.03.  Nature of Guarantee. (a) If and
to the extent required in order for the Obligations to be enforceable under applicable
federal, state and other laws relating to the insolvency of debtors, the
maximum liability of such Guarantor hereunder shall be limited to the greatest
amount which can lawfully be guaranteed by such Guarantor under such laws,
after giving effect to any rights of contribution, reimbursement and
subrogation arising under Article VI. Each Guarantor acknowledges and
agrees that, to the extent not prohibited by applicable law, (i) such
Guarantor (as opposed to its creditors, representatives of creditors or
bankruptcy trustee, including such Guarantor in its capacity as debtor in
possession exercising any powers of a bankruptcy trustee) has no personal right
under such laws to reduce, or request any judicial relief that has the effect
of reducing, the amount of its liability under this Agreement, (ii) such
Guarantor (as opposed to its creditors, representatives of creditors or
bankruptcy trustee, including such Guarantor in its capacity as debtor in
possession exercising any powers of a bankruptcy trustee) has no personal right
to enforce the limitation set forth in this Section 2.03(a) or to
reduce, or request judicial relief reducing, the amount of its liability under
this Agreement, and (iii) the limitation set forth in this Section 2.03(a) may
be enforced only to the extent required under such laws in order for the
obligations of such Guarantor under this Agreement to be enforceable under such
laws and only by or for the benefit of a creditor, representative of creditors
or bankruptcy trustee of such Guarantor or other person entitled, under such
laws, to enforce the provisions thereof.


 


(b) Except
for termination of a Guarantor’s obligations hereunder as expressly provided in
Section 7.15, the obligations of each Guarantor hereunder shall not be
subject to any reduction, limitation, impairment or termination for any reason,
including any claim of waiver, release, surrender, alteration or compromise,
and shall not be subject to any defense or setoff, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality or
unenforceability of the Obligations or otherwise. Without limiting the
generality of the foregoing, the obligations of each Guarantor hereunder shall
not be discharged or impaired or otherwise affected by (i) the failure of
the Collateral Agent or any other Secured Party to assert any claim or demand
or to enforce any right or remedy under the provisions of any Loan Document or
otherwise, (ii) any rescission, waiver, amendment or modification of, or
any release from any of the terms or provisions of, any Loan Document or any
other agreement, including with respect to any other Guarantor under this
Agreement, (iii) the release of, or any impairment of or failure to
perfect any Lien on or security interest in, any security held by the
Collateral Agent or any other Secured Party for the Obligations or any of them,
(iv) any default, failure or delay, wilful or otherwise, in the
performance of the Obligations, or (v) any other act or omission that may
or might in any manner or to any extent vary the risk of any Guarantor or
otherwise operate as a discharge of any Guarantor as a matter of law or equity
(other than the indefeasible payment in full in cash of all the Obligations).
Subject to the terms of this Agreement, each Guarantor expressly authorizes the
Collateral Agent to take and hold security for the payment and performance of
the Obligations, to exchange, waive or release any or all such security (with
or without consideration), to enforce or apply such security and direct the
order and


 


7














 


manner of any sale
thereof in its sole discretion or to release or substitute any one or more
other guarantors or obligors upon or in respect of the Obligations, all without
affecting the obligations of any Guarantor hereunder.


 


(c) To
the fullest extent permitted by applicable law, each Guarantor waives any
defense based on or arising out of any defense of the Borrower or any other
Loan Party or the unenforceability of the Obligations or any part thereof from
any cause, or the cessation from any cause of the liability of the Borrower or
any other Loan Party, other than the indefeasible payment in full in cash of
all the Obligations. The Collateral Agent and the other Secured Parties may, at
their election, foreclose on any security held by one or more of them by one or
more judicial or nonjudicial sales, accept an assignment of any such security
in lieu of foreclosure, compromise or adjust any part of the Obligations, make
any other accommodation with the Borrower or any other Loan Party or exercise
any other right or remedy available to them against the Borrower or any other
Loan Party, without affecting or impairing in any way the liability of any
Guarantor hereunder except to the extent the Obligations have been fully and
indefeasibly paid in full in cash. To the fullest extent permitted by
applicable law, each Guarantor waives any defense arising out of any such
election even though such election operates, pursuant to applicable law, to
impair or to extinguish any right of reimbursement or subrogation or other
right or remedy of such Guarantor against the Borrower or any other Loan Party,
as the case may be, or any security.


 


SECTION 2.04.
Reinstatement.  Each Guarantor agrees that its guarantee
hereunder shall continue to be effective or be reinstated, as the case may be,
if at any time payment, or any part thereof, of any Obligation is rescinded or
must otherwise be restored by the Collateral Agent or any other Secured Party
upon the bankruptcy or reorganization of the Borrower, any other Loan Party or
otherwise.


 


SECTION 2.05. Agreement To Pay; Subrogation.  In furtherance of the foregoing and not
in limitation of any other right that the Collateral Agent or any other Secured
Party has at law or in equity against any Guarantor by virtue hereof, if the
Borrower or any other Loan Party shall fail to pay any Obligation when and as
the same shall become due (after taking into account any applicable grace
period), whether at maturity, by acceleration, after notice of prepayment or
otherwise, each Guarantor hereby promises to and will forthwith pay, or cause
to be paid, to the Collateral Agent for distribution to the applicable Secured
Parties in cash the amount of such unpaid Obligation. Upon payment by any
Guarantor of any sums to the Collateral Agent as provided above, all rights of
such Guarantor against the Borrower or any other Guarantor arising as a result
thereof by way of right of subrogation, contribution, reimbursement, indemnity
or otherwise shall in all respects be subject to Article VI, provided that each Guarantor reserves any
and all other rights of reimbursement, contribution or subrogation at any time
available to it against any other Guarantor.


 


SECTION 2.06. Information.
Each Guarantor assumes all responsibility for being and keeping
itself informed of the Borrower’s and each other Loan Party’s financial
condition and assess and of all other circumstances bearing upon the risk of
nonpayment of the Obligations and the nature, scope and extent of the risks
that such


 


8

















 


Guarantor assumes
and incurs hereunder, and agrees that neither the Collateral Agent nor any
other Secured Party will have any duty to advise such Guarantor of information
known to it or any of them regarding such circumstances or risks.


 


ARTICLE III 


 


Pledge of Securities


 


SECTION 3.01.
Pledge.  As security for the payment or
performance, as the case may be, in full of the Obligations, each Grantor
hereby assigns and pledges to the Collateral Agent, its successors and assigns,
for the ratable benefit of the Secured Parties, and hereby grants to the
Collateral Agent, its successors and assigns, for the ratable benefit of the
Secured Parties, a security interest in, all of such Grantor’s right, title and
interest in, to and under (a)(i) the Equity Interests owned by such
Grantor on the date hereof (including all such Equity Interests listed on
Schedule II), (ii) any other Equity Interests obtained in the future by
such Grantor and (iii) the certificates representing all such Equity
Interests (all the foregoing collectively referred to herein as the “Pledged Stock”); provided,
however, that the Pledged Stock shall not include (x) more
than 66% of the issued and outstanding voting Equity Interests of any Foreign
Subsidiary or (y) an Excluded Asset, (b)(i) the debt securities held
by such Grantor on the date hereof (including all such debt securities listed
opposite the name of such Grantor on Schedule II), (ii) any debt
securities in the future issued to such Grantor and (iii) the promissory
notes and any other instruments evidencing such debt securities (all the
foregoing collectively referred to herein as the “Pledged Debt Securities”), (c) all other property that may be
delivered to and held by the Collateral Agent pursuant to the terms of this Section 3.01,
(d) subject to Section 3.06, all payments of principal or interest,
dividends, cash, instruments and other property from time to time received,
receivable or otherwise distributed in respect of, in exchange for or upon the
conversion of, and all other Proceeds received in respect, of the securities
referred to in clauses (a) and (b) above, (e) subject to Section 3.06,
all rights and privileges of such Grantor with respect to the securities and
other property referred to in clauses (a), (b), (c) and
(d) above, and (f) all Proceeds of any of the foregoing (the items
referred to in clauses (a) through (f) above being collectively
referred to as the “Pledged
Collateral”); provided, however, that
notwithstanding any other provision in this agreement, this Section 3.01
shall not, at any time, constitute a grant of security interest in an Excluded
Asset.


 


TO HAVE AND TO HOLD the Pledged Collateral, together
with all right, title, interest, powers, privileges and preferences pertaining
or incidental thereto, unto the Collateral Agent, its successors and assigns,
for the ratable benefit of the Secured Parties, forever; subject, however, to the terms, covenants
and conditions hereinafter set forth.


 


SECTION 3.02. Delivery of the Pledged Collateral.  (a) Each Grantor agrees promptly to
deliver or cause to be delivered to the Collateral Agent any and all
certificates, instruments or other documents representing or evidencing Pledged
Securities.


 


9

















 


(b)  Each Grantor
agrees promptly to deliver or cause to be delivered to the Collateral Agent any
and all Pledged Debt Securities.


 


(c)   Upon delivery to the Collateral
Agent, (i) any certificate, instrument or document representing or
evidencing Pledged Securities shall be accompanied by undated stock powers duly
executed in blank or other undated instruments of transfer satisfactory to the
Collateral Agent and duly executed in blank and by such other instruments and
documents as the Collateral Agent may reasonably request and (ii) all
other property comprising part of the Pledged Collateral shall be accompanied
by proper instruments of assignment duly executed by the applicable Grantor and
such other instruments or documents as the Collateral Agent may reasonably
request. Each delivery of Pledged Securities shall be accompanied by a schedule
describing the applicable securities, which schedule shall be attached hereto
as Schedule II and made a part hereof; provided that failure to attach any such schedule hereto
shall not affect the validity of the pledge of such Pledged Securities.
Each schedule so delivered shall supplement any prior schedules so delivered.


 


SECTION 3.03. Representations, Warranties and Covenants.  The Grantors jointly and severally
represent, warrant and covenant to and with the Collateral Agent, for the
benefit of the Secured Parties, that:


 


(a)   Schedule
II correctly sets forth in all material respects the percentage of the issued
and outstanding shares of each class of the Equity Interests of the issuer
thereof represented by such Pledged Stock and includes all Equity Interests,
debt securities and promissory notes required to be pledged hereunder;


 


(b)  the
Pledged Stock and Pledged Debt Securities have been duly and validly authorized
and issued by the issuers thereof and (1) in
the case of Pledged Stock, are fully paid and nonassessable and (ii) in
the case of Pledged Debt Securities, are legal, valid and binding obligations
of the issuers thereof;


 


(c)   except
for the security interests granted hereunder (or otherwise permitted under the
Credit Agreement), each Grantor (i) is and, subject to any transfers made
in compliance with the Credit Agreement, will continue to be the direct owner,
beneficially and of record, of the Pledged Securities indicated on Schedule II
as owned by such Grantor, (ii) holds the same free and clear of all Liens,
(iii) will make no assignment, pledge, hypothecation or transfer of, or
create or permit to exist any security interest in or other Lien on, the
Pledged Collateral, other than transfers made in compliance with the Credit
Agreement, and (iv) subject to Section 3.06, will cause any and all
Pledged Collateral, whether for value paid by such Grantor or otherwise, to be
forthwith deposited with the Collateral Agent and pledged or assigned
hereunder;


 


(d)  except
for restrictions and limitations imposed by the Loan Documents or securities
laws generally, the Pledged Collateral is and will continue to be freely
transferable and assignable, and none of the Pledged


 


10

















 


Collateral is or
will be subject to any option, right of first refusal, shareholders agreement,
charter or by-law provisions or contractual restriction of any nature that
might prohibit, impair, delay or otherwise affect the pledge of such Pledged
Collateral hereunder, the sale or disposition thereof pursuant hereto or the
exercise by the Collateral Agent of rights and remedies hereunder;


 


(e)  each
Grantor (i) has the power and authority to pledge the Pledged Collateral
pledged by it hereunder in the manner hereby done or contemplated and (ii) will
defend its title or interest thereto or therein against any and all Liens
(other than any Lien created or permitted by the Loan Documents), however
arising, of all persons whomsoever;


 


(f)   no
consent or approval of any Governmental Authority, any securities exchange or
any other person was or is necessary to the validity of the pledge effected
hereby (other than such as have been obtained and are in full force and effect
or those that, if not obtained, could not reasonably be expected to result in a
Material Adverse Effect,);


 


(g)  by
virtue of the execution and delivery by each Grantor of this Agreement, when
any Pledged Securities are delivered to the Collateral Agent in accordance with
this Agreement, the Collateral Agent will obtain a legal valid and perfected
first priority lien upon and security interest in such Pledged Securities as
security for the payment and performance of the Obligations; and


 


(h) the pledge effected hereby is effective to
vest in the Collateral Agent, for the ratable benefit of the Secured Parties,
the rights of the Collateral Agent in the Pledged Collateral as set forth
herein and all action by any Grantor necessary or desirable to protect and
perfect the Lien on the Pledged Collateral has been duly taken.


 


SECTION 3.04.
Certification of Limited Liability Company
Interests and Limited Partnership Interests.  No interest of any Grantor in any
limited liability company or limited partnership which is a Subsidiary and
pledged hereunder is represented by a certificate. The Grantors shall not,
without the consent of the Administrative Agent, agree to any amendment of the certificate
of formation or limited liability company agreement (or other comparable constituent
document) governing Pledged Stock which has the effect of turning
previously uncertificated capital stock or membership interests into
certificated capital stock or membership interests or which elects to
treat any membership interest that is part of the Pledged Stock as a “security”
under Section 8-103 of the New York UCC.


 


SECTION 3.05.
Registration in Nominee Name; Denominations. The Collateral Agent, on behalf of the Secured
Parties, shall have the right (in its sole and absolute discretion) to hold the
Pledged Securities in its own name as pledgee, the name of its nominee (as
pledgee or as sub-agent) or the name of the applicable Grantor, endorsed or
assigned in blank or in favor of the Collateral Agent. Each Grantor will
promptly give to the Collateral Agent copies of any notices or other
communications


 


11

















 


received by it with
respect to Pledged Securities in its capacity as the registered owner thereof.
The Collateral Agent shall at any time during the occurrence and continuation
of an Event of Default have the right to exchange the certificates representing
Pledged Securities for certificates of smaller or larger denominations for any
purpose consistent with this Agreement.


 


SECTION 3.06.
Voting Right; Dividends and
Interest Etc.  (a) Unless
and until an Event of Default shall have occurred and be continuing and the
Collateral Agent shall have given the Grantors reasonable advance notice of its
intent to exercise its rights under this Agreement (which notice shall be
deemed to have been given immediately upon the occurrence of an Event of
Default under paragraph (g) or (h) of Article VII of the Credit
Agreement):


 


(i)      Each
Grantor shall be entitled to exercise any and all voting and/or other consensual
rights and powers inuring to an owner of Pledged Securities or any part thereof
for any purpose consistent with the terms of this Agreement, the Credit
Agreement and the other Loan Documents; provided,
however, that such rights and powers shall not be exercised in any
manner that could materially and adversely affect the rights inuring to a
holder of any Pledged Securities or the rights and remedies of any of the
Collateral Agent or the other Secured Parties under this Agreement or the
Credit Agreement or any other Loan Document or the ability of the Secured
Parties to exercise the same.


 


(ii)    The
Collateral Agent shall execute and deliver to each Grantor, or cause to be
executed and delivered to each Grantor, all such proxies, powers of attorney
and other instruments as such Grantor may reasonably request for the purpose of
enabling such Grantor to exercise the voting and/or consensual rights and
powers it is entitled to exercise pursuant to paragraph (i) above.


 


(iii)   Each Grantor shall be entitled to receive and retain
any and all dividends, interest, principal and other distributions paid on or
distributed in respect of the Pledged Securities to the extent and only to the
extent that such dividends, interest, principal and other distributions are
permitted by, and otherwise paid or distributed in accordance with, the terms
and conditions of the Credit Agreement, the other Loan Documents and applicable
law; provided, however, that any
noncash dividends, interest, principal or other distributions that would
constitute Pledged Stock or Pledged Debt Securities, whether resulting from a
subdivision, combination or reclassification of the outstanding Equity
Interests of the issuer of any Pledged Securities or received in exchange for
Pledged Securities or any part thereof, or in redemption thereof, or as a
result of any merger, consolidation, acquisition or other exchange of assets to
which such issuer may be a party or otherwise, shall be and become part of the
Pledged Collateral, and, if received by any Grantor, shall not be commingled by
such Grantor with any of its other funds or property but


 


12

















 


shall
be held separate and apart therefrom, shall be held in trust for the ratable
benefit of the Secured Parties and shall be forthwith delivered to the
Collateral Agent in the same form as so received (with any necessary
endorsement or instrument of assignment). This paragraph (iii) shall not
apply to dividends between or among the Borrower, the Guarantors and any Subsidiaries
only of property subject to a perfected security interest under this Agreement;
provided that the Borrower
notifies the Collateral Agent in writing, specifically referring to this Section 3.06
at the time of such
dividend and takes any actions the Collateral Agent specifies to ensure
the continuance of its perfected security interest in such property under this
Agreement.


 


(b)  Upon the
occurrence and during the continuance of an Event of Default, after the
Collateral Agent shall have notified (or shall be deemed to have notified
pursuant to Section 3.06(a)) the Grantors of the suspension of their
rights under paragraph (a)(iii) of this Section 3.06, then all rights
of any Grantor to dividends, interest, principal or other distributions that
such Grantor is authorized to receive pursuant to paragraph (a)(iii) of
this Section 3.06 shall cease, and all such rights shall thereupon become
vested in the Collateral Agent, which shall have the sole and exclusive right
and authority to receive and retain such dividends, interest, principal or
other distributions. All dividends, interest, principal or other distributions
received by any Grantor contrary to the provisions of this Section 3.06
shall be held in trust for the benefit of the Collateral Agent, shall be
segregated from other property or funds of such Grantor and shall be forthwith
delivered to the Collateral Agent upon demand in the same form as so received
(with any necessary endorsement or instrument of assignment). Any and all money
and other property paid over to or received by the Collateral Agent pursuant to
the provisions of this paragraph (b) shall be retained by the Collateral
Agent in an account to be established by the Collateral Agent upon receipt of
such money or other property and shall be applied in accordance with the
provisions of Section 5.02. After all Events of Default have been cured or
waived and each applicable Grantor has delivered to the Administrative Agent
certificates to that effect, the Collateral Agent shall, promptly after all
such Events of Default have been cured or waived, repay to each applicable
Grantor (without interest) all dividends, interest, principal or other
distributions that such Grantor would otherwise be permitted to retain pursuant
to the terms of paragraph (a)(iii) of this Section 3.06 and that
remain in such account.


 


(c)   Upon the
occurrence and during the continuance of an Event of Default, after the
Collateral Agent shall have notified (or shall be deemed to have notified
pursuant to Section 3.06(a)) the Grantors of the suspension of their
rights under paragraph (a)(i) of this Section 3.06, then all rights
of any Grantor to exercise the voting and consensual rights and powers it is
entitled to exercise pursuant to paragraph (a)(i) of this Section 3.06,
and the obligations of the Collateral Agent under paragraph (a)(ii) of
this Section 3.06, shall cease, and all such rights shall thereupon become
vested in the Collateral Agent, which shall have the sole and exclusive right
and authority to exercise such voting and consensual rights and powers; provided that, unless otherwise directed
by the Required Lenders, the Collateral Agent shall have the right from time to
time following and during the continuance of an Event of Default to permit the
Grantors to exercise such rights.


 


13

















 


(d) Any
notice given by the Collateral Agent to the Grantors exercising its rights
under paragraph (a) of this Section 3.06 (i) may be given by
telephone if promptly confirmed in writing, (ii) may be given to one or
more of the Grantors at the same or different times and (iii) may suspend
the rights of the Grantors under paragraph (a)(i) or paragraph (a)(iii) in
part without suspending all such rights (as specified by the Collateral Agent in
its sole and absolute discretion) and without waiving or otherwise affecting
the Collateral Agent’s rights to give additional notices from time to time
suspending other rights so long as an Event of Default has occurred and is
continuing.


 


ARTICLE IV 


 


Security Interests in Personal
Property


 


SECTION 4.01.  Security Interest. (a) As
security for the payment or performance, as the case may be, in full of the
Obligations, each Grantor hereby assigns and pledges to the Collateral Agent,
its successors and assigns, for the ratable benefit of the Secured Parties, and
hereby grants to the Collateral Agent, its successors and assigns, for the
ratable benefit of the Secured Parties, a security interest (the “Security
Interest”), in
all right, title or interest in or to any and all of the following assets and
properties now owned or at any time hereafter acquired by such Grantor or in
which such Grantor now has or at any time in the future may acquire any right,
title or interest (collectively, the “Article 9 Collateral”):


 


(i)           all
Accounts;


 


(ii)          all
Chattel Paper;


 


(iii)         all cash and Deposit Accounts;


 


(iv)         all
Documents;


 


(v)          all
Equipment;


 


(vi)         all
General Intangibles;


 


(vii)        all Instruments;


 


(viii)       all Inventory;


 


(ix)         all
Investment Property;


 


(x)           all Letter-of-Credit
Rights;


 


(xi)         all
Commercial Tort Claims;


 


(xii)        all
books and records pertaining to the Article 9 Collateral; and


 


14

















 


(xiii) to the extent not otherwise included, all
Proceeds and products of any and all of the foregoing and all collateral
security and guarantees given by any person with respect to any of the
foregoing.


 


Notwithstanding
any provision in this Agreement, this Section 4.01(a) shall not, at
any time, constitute a grant of security interest in an Excluded Asset.


 


(b)  Each
Grantor hereby irrevocably authorizes the Collateral Agent at any time and from
time to time to file in any relevant jurisdiction any initial financing statements
(including fixture filings) with respect to the Article 9 Collateral or
any part thereof and amendments thereto that (i) indicate the Article 9
Collateral as “all assets” of such Grantor or words of similar effect, and (ii) contain
the information required by Article 9 of the Uniform Commercial Code of
each applicable jurisdiction for the filing of any financing statement or
amendment, including (A) whether such Grantor is an organization, the type
of organization and any organizational identification number issued to such
Grantor and (B) in the case of a financing statement filed as a fixture
filing, a sufficient description of the real property to which such Article 9
Collateral relates. Each Grantor agrees to provide such information to the
Collateral Agent promptly upon request.


 


Each Grantor also ratifies its authorization for the
Collateral Agent to file in any relevant jurisdiction any initial financing
statements or amendments thereto if filed prior to the date hereof.


 


The Collateral Agent is further authorized to file
with the United States Patent and Trademark Office or United States Copyright
Office (or any successor office or any similar office in any other country)
such documents as may be necessary or advisable for the purpose of perfecting,
confirming, continuing, enforcing or protecting the Security Interest granted
by each Grantor, without the signature of any Grantor, and naming any Grantor
or the Grantors as debtors and the Collateral Agent as secured party.


 


(c)  The
Security Interest is granted as security only and shall not subject the Collateral
Agent or any other Secured Party to, or in any way alter or modify, any obligation
or liability of any Grantor with respect to or arising out of the Article 9
Collateral.


 


SECTION 4.02. Representations and Warranties.  The Grantors jointly and severally represent
and warrant to the Collateral Agent and the Secured Parties that:


 


(a) Each Grantor has good and valid rights in and
title to the Article 9 Collateral with respect to which it has purported
to grant a Security Interest hereunder and has full power and authority to
grant to the Collateral Agent, for the ratable benefit of the Secured Parties,
the Security Interest in such Article 9 Collateral pursuant hereto and to
execute, deliver and perform its obligations in accordance with the terms of
this Agreement, without the consent or approval of any other person other than (i) any
consent or approval that has been obtained or (ii) those that, if not
obtained, could not reasonably be expected to result in a Material Adverse
Effect.


 


15

















 


(b)  The
Perfection Certificate has been duly prepared, completed and executed and the
information set forth therein (including (x) the exact legal name of each
Grantor and (y) the jurisdiction of organization of each Grantor) is
correct and complete as of the Closing Date. Uniform Commercial Code financing
statements (including fixture filings, as applicable) or other appropriate
filings, recordings or registrations containing a description of the Article 9
Collateral have been prepared by the Collateral Agent based upon the
information provided to the Administrative Agent and the Secured Parties in the
Perfection Certificate for filing in each governmental, municipal or other
office specified in Section 2 of the Perfection Certificate (or specified
by notice from the Borrower to the Administrative Agent after the Closing Date
in the case of filings, recordings or registrations required by Sections 5.06
or 5.11 of the Credit Agreement), which are all the filings, recordings and registrations
(other than filings required to be made in the United States Patent and
Trademark Office and the United States Copyright Office in order to perfect the
Security Interest in the Article 9 Collateral consisting of United States
Patents, Trademarks and Copyrights) that are necessary to publish notice of and
protect the validity of and to establish a legal, valid and perfected security
interest in favor of the Collateral Agent (for the ratable benefit of the
Secured Parties) in respect of all Article 9 Collateral in which the
Security Interest may be perfected by filing, recording or registration in the
United States (or any political subdivision thereof) and its territories and
possessions, and no further or subsequent filing, refiling, recording, rerecording,
registration or reregistration is necessary in any such jurisdiction, except as
provided under applicable law with respect to the filing of continuation
statements. Each Grantor represents and warrants that a fully executed short
form agreement in the form requested by the Collateral Agent and containing a
description of all material Article 9 Collateral consisting of
Intellectual Property with respect to United States Patents and United States
registered Trademarks (and Trademarks for which United States registration
applications are pending) and United States registered Copyrights has been
delivered to the Collateral Agent for recording by the United States Patent and
Trademark Office and the United States Copyright Office pursuant to 35 U.S.C.
§261, 15 U.S.C. §1060 or 17 U.S.C. §205 and the regulations thereunder, as
applicable, and otherwise as may be required pursuant to the laws of any other
necessary jurisdiction, to protect the validity of and to establish a legal,
valid and perfected security interest in favor of the Collateral Agent (for the
ratable benefit of the Secured Parties) in respect of all Article 9
Collateral consisting of Patents, Trademarks and Copyrights in which a security
interest may be perfected by filing, recording or registration in the United
States (or any political subdivision thereof) and its territories and
possessions, and no further or subsequent filing, refiling, recording,
rerecording, registration or reregistration is necessary (other than such
actions as are necessary to perfect the Security Interest with respect to any Article 9
Collateral consisting of Patents, Trademarks and Copyrights (or  registration
or application for registration thereof) acquired or developed after the date
hereof).


 


(c)   The
Security Interest constitutes (i) a legal and valid security interest in all
Article 9 Collateral securing the payment and performance of the


 


16

















 


Obligations,
(ii) upon completion of the filings described in Section 4.02(b), a
perfected security interest in all Article 9 Collateral in which a
security interest may be perfected by filing, recording or registering a
financing statement or analogous document in the United States (or any
political subdivision thereof) and its territories and possessions pursuant to
the Uniform Commercial Code or other applicable law in such jurisdictions and (iii) a
security interest that shall be perfected in all Article 9 Collateral to
the extent that a security interest may be perfected upon the receipt and
recording of this Agreement with the United States Patent and Trademark Office
and the United States Copyright Office, as applicable. The Security Interest is
and shall be prior to any other Lien on any of the Article 9 Collateral,
other than Liens expressly permitted pursuant to Section 6.02 of the
Credit Agreement that have priority as a matter of law.


 


(d) The Article 9 Collateral is owned by the
Grantors free and clear of any Lien, except for Liens expressly permitted
pursuant to Section 6.02 of the Credit Agreement. As of the Closing Date,
no Grantor has filed or consented to the filing of (i) any financing
statement or analogous document under the Uniform Commercial Code or any other
applicable laws covering any Article 9 Collateral, (ii) any
assignment in which any Grantor assigns any Collateral or any security
agreement or similar instrument covering any Article 9 Collateral with the
United States Patent and Trademark Office or the United States Copyright Office,
(iii) any notice under the Assignment of Claims Act, or (iv) any
assignment in which any Grantor assigns any Article 9 Collateral or any
security agreement or similar instrument covering any Article 9 Collateral
with any foreign governmental, municipal or other office, which financing
statement or analogous document, assignment, security agreement or similar
instrument is still in effect, except, in each case, for Liens expressly
permitted pursuant to Section 6.02 of the Credit Agreement and prior
existing Liens no longer in effect. No Grantor holds any Commercial Tort Claims
seeking damages in excess of $250,000 except as indicated on the Perfection
Certificate.


 


SECTION 4.03. Covenants.
(a) Each Grantor agrees promptly to notify the Collateral Agent
in writing of any change in (i) its legal name, (ii) its identity or
type of organization or corporate structure, (iii) its Federal Taxpayer
Identification Number or organizational identification number or (iv) its
jurisdiction of organization. Each Grantor agrees promptly to provide the
Collateral Agent with certified organizational documents reflecting any of the
changes described in the first sentence of this paragraph. Each Grantor agrees
not to effect or permit any change referred to in the preceding sentence unless
all filings have been made under the Uniform Commercial Code or otherwise that
are required in order for the Collateral Agent to continue at all times
following such change to have a valid, legal and perfected first priority
security interest in all the Article 9 Collateral. Each Grantor agrees
promptly to notify the Collateral Agent if any material portion of the Article 9
Collateral owned or held by such Grantor is damaged or destroyed.


 


(b) Each
Grantor agrees to maintain, at its own cost and expense, such complete and
accurate records with respect to the Article 9 Collateral owned by it as
is


 


17

















 


consistent with its
current practices and in accordance with such prudent and standard practices
used in industries that are the same as or similar to those in which such
Grantor is engaged, but in any event to include complete accounting records
indicating all payments and proceeds received with respect to any material part
of the Article 9 Collateral, and, at such time or times as the Collateral
Agent may reasonably request, promptly to prepare and deliver to the Collateral
Agent a duly certified schedule or schedules in form and detail reasonably
satisfactory to the Collateral Agent showing the identity, amount and location
of any material Article 9 Collateral, provided
that, unless an Event of Default has occurred and is continuing, the
Collateral Agent shall be limited to one such requests in each calendar year.


 


(c)   Each Grantor
shall, at its own expense, take any and all actions reasonably necessary to
defend title to the Article 9 Collateral against all persons and to defend the Security Interest of the Collateral
Agent in the Article 9 Collateral and the priority thereof against
any Lien not expressly permitted pursuant to Section 6.02 of the Credit
Agreement.


 


(d)  Each Grantor
agrees, at its own expense, promptly to execute, acknowledge, deliver and cause
to be duly filed all such further instruments and documents and take all such
actions as the Collateral Agent may from time to time reasonably request to
better assure, obtain, preserve, protect and perfect the Security Interest and
the rights and remedies created hereby, including the payment of any fees and
Taxes required in connection with the execution and delivery of this Agreement,
the granting of the Security Interest and the filing of any financing or
continuation statements (including fixture filings) or other documents in
connection herewith or therewith. If any amount payable to any Grantor under or
in connection with any of the Article 9 Collateral shall be or become
evidenced by any Instrument or Tangible Chattel Paper, in excess of $250,000
individually or $500,000 in the aggregate, then such Instrument or Tangible
Chattel Paper shall be promptly pledged and delivered to the Collateral Agent,
duly endorsed in a manner satisfactory to the Collateral Agent, except to the
extent the costs of such actions are, in the Collateral Agent’s reasonable
judgment, excessive in relation to the value of the security to be afforded
thereby or to the extent prohibited by applicable law (or in the case of an
amount payable by any Foreign Subsidiary, to the extent such actions would, in
the Borrower’s good faith determination, result in adverse tax consequences).


 


Without limiting the generality of the foregoing, each
Grantor hereby authorizes the Collateral Agent, with prompt notice thereof to
the Grantors, to supplement this Agreement by supplementing Schedule III or
adding additional schedules hereto to identify specifically any asset or item
of a Grantor that may, in the Collateral Agent’s reasonable judgment,
constitute material Copyrights, Licenses, Patents or Trademarks; provided that any Grantor shall have the
right, exercisable within 10 days after it has been notified by the Collateral
Agent of the specific identification of such Collateral, to advise the
Collateral Agent in writing of any material inaccuracy of the representations
and warranties made by such Grantor hereunder with respect to such Collateral.
Each Grantor agrees that it will use its commercially reasonable efforts to
take such action as shall be necessary in order that all representations and
warranties hereunder shall be true and correct in all material respects with
respect to such Collateral


 


18














 


within 30 days after the
date it has been notified by the Collateral Agent of the specific
identification of such Collateral.


 


(e)  The Collateral Agent and such
persons as the Collateral Agent may designate shall have the right, at the
applicable Grantor’s own cost and expense, to inspect the Article 9
Collateral, all records related thereto (and to make extracts and copies from
such records) and the premises upon which any of the Article 9 Collateral
is located, to discuss the applicable Grantor’s affairs with the officers of
such Grantor and its independent accountants and to verify the existence,
validity, amount, quality, quantity, value, condition and status of, or any
other matter relating to, the Article 9 Collateral, including, in the case
of Accounts or other Article 9 Collateral in the possession of any third
person, by contacting Account Debtors or the third person possessing such Article 9
Collateral for the purpose of making such a verification. The Collateral Agent
shall have the absolute right to share any information it gains from such
inspection or verification with any Secured Party.


 


(f)  At its option, upon the
occurrence and continuance of an Event of Default, the Collateral Agent may
discharge past due Taxes, assessments, charges, fees, Liens, security interests
or other encumbrances at any time levied or placed on the Article 9
Collateral and not expressly permitted pursuant to Section 5.03 or Section 6.02
of the Credit Agreement, and may pay for the maintenance and preservation of
the Article 9 Collateral to the extent any Grantor fails to do so as
required by the Credit Agreement or this Agreement, and each Grantor jointly
and severally agrees to reimburse the Collateral Agent on demand for any
reasonable and documented payment made or any expense incurred by the
Collateral Agent pursuant to the foregoing authorization; provided, however, that nothing in this
paragraph shall be interpreted as excusing any Grantor from the performance of,
or imposing any obligation on the Collateral Agent or any Secured Party to cure
or perform, any covenants or other promises of any Grantor with respect to
Taxes, assessments, charges, fees, Liens, security interests or other
encumbrances and maintenance as set forth herein or in the other Loan
Documents.


 


(g) If at any time any Grantor
shall take a security interest in any property of an Account Debtor or any
other person to secure payment and performance of an Account, the value of
which exceeds $250,000 individually or $500,000 in the aggregate, such Grantor
shall promptly assign such security interest to the Collateral Agent for the
ratable benefit of the Secured Parties. Such assignment need not be filed of
public record unless necessary to continue the perfected status of the security
interest against creditors of and transferees from the Account Debtor or other
person granting the security interest.


 


(h) Each
Grantor shall remain liable to observe and perform all the material conditions
and obligations to be observed and performed by it under each contract,
agreement or instrument relating to the Article 9 Collateral, all in
accordance with the terms and conditions thereof, and each Grantor jointly and
severally agrees to indemnify and hold harmless the Collateral Agent and the
Secured Parties from and against any and all liability for such performance.


 


19

















 


(i) No
Grantor shall make or permit to be made an assignment, pledge or hypothecation
of the Article 9 Collateral or shall grant any other Lien in respect of
the Article 9 Collateral or permit any notice to be filed under the
Assignment of Claims Act, except, in each case, as expressly permitted by Section 6.02
of the Credit Agreement. No Grantor shall make or permit to be made any
transfer of the Article 9 Collateral and each Grantor shall remain at all
times in possession or otherwise in control of the Article 9 Collateral
owned by it, except as permitted by the Credit Agreement.


 


(j) No
Grantor will, without the Collateral Agent’s prior written consent, grant any
extension of the time of payment of any Accounts included in the Article 9
Collateral, compromise, compound or settle the same for less than the full
amount thereof, release, wholly or partly, any person liable for the payment
thereof or allow any credit or discount whatsoever thereon, other than
extensions, credits, discounts, compromises, compoundings or settlements
granted or made in the ordinary course of business and consistent with its
current practices and in accordance with such prudent and standard practice
used in industries that are the same as or similar to those in which such
Grantor is engaged.


 


(k) In
the event that any Grantor at any time or times shall fail to obtain or
maintain any of the policies of insurance required under the Credit Agreement
or to pay any premium in whole or part relating thereto, the Collateral Agent
may, without waiving or releasing any obligation or liability of any Grantor
hereunder or any Default or Event of Default, in its sole discretion, obtain and
maintain such policies of insurance and pay such premium and take any other
actions with respect thereto as the Collateral Agent deems advisable.  All sums disbursed by the Collateral Agent in
connection with this paragraph, including attorneys’ fees, court costs,
expenses and other charges relating thereto, shall be payable, upon demand, by
the Grantors to the Collateral Agent and shall be additional Obligations
secured hereby.


 


(1) Each
Grantor shall maintain, in form and manner satisfactory to the Collateral Agent,
records of its Chattel Paper and its books, records and documents evidencing or
pertaining thereto.


 


SECTION 4.04. Other Actions.  In order to further insure the attachment, perfection and
priority of, and the ability of the Collateral Agent to enforce, the Security
Interest in the Article 9 Collateral, each Grantor agrees, in each case at
such Grantor’s own expense, to take the following actions with respect to the
following Article 9 Collateral:


 


(a) Instruments.  If any Grantor shall at any time hold or
acquire any Instruments having a value in excess of $250,000, such Grantor
shall forthwith endorse, assign and deliver the same to the Collateral Agent,
accompanied by such undated instruments of endorsement, transfer or assignment
duly executed in blank as the Collateral Agent may from time to time reasonably
specify, except to the extent the costs of such actions are, in the Collateral
Agent’s reasonable judgment, excessive in relation to the value of the security
to be afforded thereby or to the extent prohibited by applicable law (or in the
case of an amount payable


 


20

















 


by any Foreign
Subsidiary, to the extent such actions would, in the Borrower’s good faith
determination, result in adverse tax consequences).


 


(b) Deposit
Accounts.  For each Deposit Account that any
Grantor at any time opens or maintains, other than Deposit Accounts (A) that
are payroll accounts, withholdings tax accounts, petty cash accounts or
flexible spending benefit accounts or trust, escrow or other fiduciary accounts
or (B) which do not hold for any period of five consecutive days, an
aggregate amount in excess of $1,000,000, such Grantor shall, upon the
Collateral Agent’s request, either (i) cause the depositary bank to agree
to comply at any time with instructions from the Collateral Agent to such
depositary bank directing the disposition of funds from time to time credited
to such Deposit Account, without further consent of such Grantor or any other
person, pursuant to an agreement in form and substance satisfactory to the
Collateral Agent, or (ii) arrange for the Collateral Agent to become the
customer of the depositary bank with respect to the Deposit Account, with the
Grantor being permitted, only with the consent of the Collateral Agent, to
exercise rights to withdraw funds from such Deposit Account.  The Collateral Agent agrees with each Grantor
that the Collateral Agent shall not give any such instructions or withhold any
withdrawal rights from any Grantor, unless an Event of Default has occurred and
is continuing, or, after giving effect to any withdrawal, would occur; provided, however, upon the waiver by the
applicable Required Lenders of such Event of Default, so long as no other Event
of Default shall then exist or be continuing, the Collateral Agent shall revoke
any such instruction. The provisions of this paragraph shall not apply to any
Deposit Account for which any Grantor, the depositary bank and the Collateral
Agent have entered into a cash collateral agreement specially negotiated among
such Grantor, the depositary bank and the Collateral Agent for the specific
purpose set forth therein.


 


(c) Investment
Property. If any
securities, whether certificated or uncertificated, or other Investment
Property having a value in excess of $50,000 in the aggregate now or hereafter
acquired by any Grantor are held by such Grantor or its nominee through a
Securities Intermediary or Commodity Intermediary, such Grantor shall promptly
notify the Collateral Agent thereof and, at the Collateral Agent’s request and
option, pursuant to an agreement in form and substance reasonably satisfactory
to the Collateral Agent, either (i) cause such Securities Intermediary or
Commodity Intermediary, as the case may be, to agree to comply with Entitlement
Orders from the Collateral Agent to such Securities Intermediary as to such
securities or other Investment Property, or (as the case may be) to apply any
value distributed on account of any commodity contract as directed by the
Collateral Agent to such Commodity Intermediary, in each case without further
consent of any Grantor or such nominee, or (ii) in the case of Financial Assets (as governed by Article 8
of the New York UCC) or other Investment Property held through a Securities
Intermediary, arrange for the Collateral Agent to become the Entitlement Holder
with respect to such Investment Property, with the Grantor being permitted,
only with the consent of the Collateral Agent, to exercise rights to withdraw
or otherwise deal with such


 


21

















 


Investment
Property. The Collateral Agent agrees with each Grantor that the Collateral Agent shall not give any such
Entitlement Orders or instructions or directions to any such issuer,
Securities Intermediary or Commodity Intermediary, and shall not withhold its
consent to the exercise of any withdrawal or dealing rights by any Grantor,
unless an Event of Default has occurred and is continuing, or, after giving
effect to any such investment and withdrawal rights would occur; provided, however, upon the waiver by the
applicable Required Lenders of such Event of Default, so long as no other Event
of Default shall then exist or be continuing, the Collateral Agent shall revoke
any such instruction. The provisions of this paragraph shall not apply to any
Financial Assets credited to a Securities Account for which the Collateral
Agent is the Securities Intermediary.


 


(d)  Electronic Chattel Paper and
Transferable Records.  If
any Grantor at any time holds or acquires an interest in any Electronic Chattel
Paper or any “transferable record”,  as that term is defined in Section 201
of the Federal Electronic Signatures in Global and National Commerce Act, or in
Section 16 of the Uniform Electronic Transactions Act as in effect in any
relevant jurisdiction, such Grantor shall promptly notify the Collateral Agent
thereof and, at the request of the Collateral Agent, shall take such action as
the Collateral Agent may request to vest in the Collateral Agent control under
New York UCC Section 9-105 of such Electronic Chattel Paper or control
under Section 201 of the Federal Electronic Signatures in Global and
National Commerce Act or, as the case may be, Section 16 of the Uniform
Electronic Transactions Act, as so in effect in such jurisdiction, of such
transferable record. The Collateral Agent agrees with such Grantor that the
Collateral Agent will arrange, pursuant to procedures satisfactory to the
Collateral Agent and so long as such procedures will not result in the
Collateral Agent’s loss of control, for the Grantor to make alterations to the
Electronic Chattel Paper or transferable record permitted under UCC Section 9-105
or, as the case may be, Section 201 of the Federal Electronic Signatures
in Global and National Commerce Act or Section 16 of the Uniform
Electronic Transactions Act for a party in control to allow without loss of
control, unless an Event of Default has occurred and is continuing or would
occur after taking into account any action by such Grantor with respect to such
Electronic Chattel Paper or transferable record.


 


(e)  Letter-of-credit Rights.  If any Grantor is at any time a
beneficiary under a letter of credit having a value in excess of $500,000 now
or hereafter issued in favor of such Grantor (other than Letters of Credit and
Letters of Credit Rights that do not constitute Supporting Obligations in
respect of other Collateral), such Grantor shall promptly notify the Collateral
Agent thereof and, at the request and option of the Collateral Agent, such
Grantor shall, pursuant to an agreement in form and substance satisfactory to
the Collateral Agent, either (i) arrange for the issuer and any confirmer
of such letter of credit to consent to an assignment to the Collateral Agent of
the proceeds of any drawing under the letter of credit or (ii) arrange for
the Collateral Agent to become the transferee beneficiary of the letter of
credit, with the Collateral Agent agreeing, in each case, that the proceeds


 


22

















 


of
any drawing under the letter of credit are to be paid to the applicable Grantor
unless an Event of Default has occurred or is continuing.


 


(f) Commercial
Tort Claims.  If any
Grantor shall at any time hold or acquire a Commercial Tort Claim seeking
damages in an amount reasonably estimated to exceed $250,000, the Grantor shall
promptly notify the Collateral Agent thereof in a writing signed by such
Grantor including a summary description of such claim and grant to the
Collateral Agent, for the ratable benefit of the Secured Parties, in such
writing a security interest therein and in the proceeds thereof, all upon the
terms of this Agreement, with such writing to be in form and substance
satisfactory to the Collateral Agent.


 


SECTION 4.05.
Covenants Regarding Patent,
Trademark and Copyright Collateral. (a) Each Grantor agrees
that it will not, and will not permit any of its licensees to, do any act, or
omit to do any act, whereby any Patent that is material to the conduct of such
Grantor’s business may become abandoned, invalidated or dedicated to the
public, and agrees that it shall use commercially reasonable efforts to
continue to mark any products covered by a material Patent with the relevant
patent number as necessary and sufficient to establish and preserve its maximum
rights under applicable patent laws.


 


(b)  Except as could not reasonably
be expected to result in a Material Adverse Effect, each Grantor (either itself
or through its licensees or its sublicensees) will, for each Trademark material
to the conduct of such Grantor’s business, (i) maintain such Trademark in
full force free from any claim of abandonment or invalidity for non-use, (ii) use commercially reasonable
efforts to maintain the quality of products and services offered under such
Trademark, (iii) display such Trademark with notice of Federal or foreign
registration to the extent necessary and sufficient to establish and preserve
its maximum rights under applicable law and (iv) not knowingly use or
knowingly permit the use of such Trademark in violation of any third party
rights.


 


(c)   Each Grantor (either itself
or through its licensees or sublicensees) will, for each work covered by a
Copyright material to the conduct of such Grantor’s business, continue to
publish, reproduce, display, adopt and distribute the work with appropriate
copyright notice as necessary and sufficient to establish and preserve its
maximum rights under applicable copyright laws.


 


(d)  Each Grantor shall notify the
Collateral Agent promptly if it knows or has reason to know that any Patent,
Trademark or Copyright material to the conduct of its business may become
abandoned, lost or dedicated to the public, or of any adverse determination or
development (including the institution of, or any such determination or
development in, any proceeding in the United States Patent and Trademark
Office, United States Copyright Office or any court or similar office of any
country) regarding such Grantor’s ownership of any Patent, Trademark or
Copyright, its right to register the same, or its right to keep and maintain
the same.


 


23

















 


(e)  Except as could not
reasonably be expected to result in a Material Adverse Effect, no Grantor shall,
either itself or through any agent, employee, licensee or designee, file an
application for any Patent, Trademark or Copyright (or for the registration of
any Trademark or Copyright) with the United States Patent and Trademark Office,
United States Copyright Office or any office or agency in any political
subdivision of the United States or in any other country or any political
subdivision thereof, unless it promptly notifies the Collateral Agent, and,
upon request of the Collateral Agent, executes and delivers any and all
agreements, instruments, documents and papers as the Collateral Agent may
request to evidence the Security Interest in such Patent, Trademark or Copyright,
and each Grantor hereby appoints the Collateral Agent as its attorney-in-fact
to execute and file such writings for the foregoing purposes, all acts of such
attorney being hereby ratified and confirmed; such power, being coupled with an
interest, is irrevocable.


 


(f)   Except as could not
reasonably be expected to result in a Material Adverse Effect, each Grantor
will take all necessary steps that are consistent with the practice in any
proceeding before the United States Patent and Trademark Office, United States
Copyright Office or any office or agency in any political subdivision of the
United States or in any other country or any political subdivision thereof, to
maintain and pursue each material application relating to the Patents,
Trademarks and/or Copyrights (and to obtain the relevant grant or registration)
and to maintain each issued Patent and each registration of the Trademarks and
Copyrights that is material to the conduct of any Grantor’s business, including
timely filings of applications for renewal, affidavits of use, affidavits of
incontestability and payment of maintenance fees, and, if consistent with good business
judgment, to initiate opposition, interference and cancellation proceedings
against third parties.


 


(g)  In the event that any Grantor
knows or has reason to believe that any Article 9 Collateral consisting of
a Patent, Trademark or Copyright material to the conduct of any Grantor’s
business has been or is about to be infringed, misappropriated or diluted by a
third person, such Grantor promptly shall notify the Collateral Agent and
shall, if consistent with good business judgment, promptly sue for
infringement, misappropriation or dilution and to recover any and all damages
for such infringement, misappropriation or dilution, and take such other
actions as are appropriate under the circumstances to protect such Article 9
Collateral.


 


(h) Upon the occurrence and during the continuance
of an Event of Default, each Grantor shall use its commercially reasonable
efforts to obtain all requisite consents or approvals by the licensor of each
Copyright License, Patent License or Trademark License, and each other material
License, to effect the assignment of all such Grantor’s right, title and
interest thereunder to the Collateral Agent, for the ratable benefit of the
Secured Parties, or its designee.


 


SECTION 4.06. Assignment of Distributions.     The
Borrower shall execute the Assignment of Distributions in the form attached
hereto as Exhibit C in favor of the Collateral Agent with respect to its
rights to any distributions of STR-Registrar LLC.


 


24

















 


ARTICLE V 


 


Remedies


 


SECTION 5.01.
Remedies Upon Default.   Upon the occurrence and
during the continuance of an Event of Default, each Grantor agrees to deliver
each item of Collateral to the Collateral Agent on demand, and it is agreed
that the Collateral Agent shall have the right to take any of or all the
following actions at the same or different times: (a) with respect to any Article 9
Collateral consisting of Intellectual Property, on demand, to cause the
Security Interest to become an assignment, transfer and conveyance of any of or
all such Article 9 Collateral by the applicable Grantor to the Collateral
Agent, or to license or sublicense, whether general, special or otherwise, and
whether on an exclusive or nonexclusive basis, any such Article 9
Collateral throughout the world on such terms and conditions and in such manner
as the Collateral Agent shall determine (other than in violation of any
then-existing licensing arrangements to the extent that waivers cannot be
obtained), and (b) with or without legal process and with or without prior
notice (except any notice required by law) or demand for performance, to take
possession of the Article 9 Collateral and without liability for trespass
to enter any premises where the Article 9 Collateral may be located for
the purpose of taking possession of or removing the Article 9 Collateral
and, generally, to exercise any and all rights afforded to a secured party
under the Uniform Commercial Code or other applicable law. Without limiting the
generality of the foregoing, each Grantor agrees that the Collateral Agent
shall have the right, subject to the mandatory requirements of applicable law,
to sell or otherwise dispose of all or any part of the Collateral at a public
or private sale or at any broker’s board or on any securities exchange, for cash,
upon credit or for future delivery as the Collateral Agent shall deem
appropriate. The Collateral Agent shall be authorized at any such sale (if it
deems it advisable to do so) to restrict the prospective bidders or purchasers
to persons who will represent and agree that they are purchasing the Collateral
for their own account for investment and not with a view to the distribution or
sale thereof, and upon consummation of any such sale the Collateral Agent shall
have the right to assign, transfer and deliver to the purchaser or purchasers
thereof the Collateral so sold. Each such purchaser at any such sale shall hold
the property sold absolutely, free from any claim or right on the part of any
Grantor, and each Grantor hereby waives (to the extent permitted by law) all
rights of redemption, stay and appraisal which such Grantor now has or may at
any time in the future have under any rule of law or statute now existing
or hereafter enacted.


 


The
Collateral Agent shall give each applicable Grantor 10 days’ written notice
(which each Grantor agrees is reasonable notice within the meaning of Section 9-611
of the New York UCC or its equivalent in other jurisdictions) of the Collateral
Agent’s intention to make any sale of Collateral. Such notice, in the case of a
public sale, shall state the time and place for such sale and, in the case of a
sale at a broker’s board or on a securities exchange, shall state the board or
exchange at which such sale is to be made and the day on which the Collateral,
or portion thereof, will first be offered for sale at such board or exchange.
Any such public sale shall be held at such time or times within ordinary
business hours and at such place or places as the Collateral Agent may fix and
state in the notice (if any) of such sale. At any such sale, the


 


25

















 


Collateral, or portion
thereof, to be sold may be sold in one lot as an entirety or in separate
parcels, as the Collateral Agent may (in its sole and absolute discretion)
determine. The Collateral Agent shall not be obligated to make any sale of any Collateral if it shall determine not
to do so, regardless of the fact that notice of sale of such Collateral shall
have been given. The Collateral Agent may, without notice or publication,
adjourn any public or private sale or cause the same to be adjourned from time
to time by announcement at the time and place fixed for sale, and such sale may, without further notice, be made
at the time and place to which the same was so adjourned. In case any sale of
all or any part of the Collateral is made on credit or for future delivery, the
Collateral so sold may be retained by the Collateral Agent until the sale price
is paid by the purchaser or purchasers thereof, but the Collateral Agent shall
not incur any liability in case any such purchaser or purchasers shall fail to
take up and pay for the Collateral so sold and, in case of any such failure,
such Collateral may be sold again upon like notice. At any public (or, to the
extent permitted by law, private) sale made pursuant to this Agreement, any
Secured Party may bid for or purchase, free (to the extent permitted by
applicable law) from any right of redemption, stay, valuation or appraisal on
the part of any Grantor (all said rights being also hereby waived and released
to the extent permitted by applicable law), the Collateral or any part thereof
offered for sale and may make payment on account thereof by using any claim
then due and payable to such Secured Party from any Grantor as a credit against
the purchase price, and such Secured Party may, upon compliance with the terms
of sale, hold, retain and dispose of such property without further
accountability to any Grantor therefor. For purposes hereof, a written
agreement to purchase the Collateral or any portion thereof shall be treated as
a sale thereof; the Collateral Agent shall be free to carry out such sale
pursuant to such agreement and no Grantor shall be entitled to the return of
the Collateral or any portion thereof subject thereto, subject to Section 5.02
of this Agreement, notwithstanding the fact that after the Collateral Agent
shall have entered into such an agreement all Events of Default shall have been
remedied and the Obligations paid in full. As an alternative to exercising the
power of sale herein conferred upon it, the Collateral Agent may proceed by a
suit or suits at law or in equity to foreclose this Agreement and to sell the
Collateral or any portion thereof pursuant to a judgment or decree of a court
or courts having competent jurisdiction or pursuant to a proceeding by a
court-appointed receiver. Any sale pursuant to the provisions of this Section 5.01
shall be deemed to conform to the commercially reasonable standards as provided
in Section 9-610(b) of the New York UCC or its equivalent in other
jurisdictions.


 


SECTION 5.02.
Application of Proceeds.  The Collateral Agent shall apply the
proceeds of any collection, sale, foreclosure or other realization upon any
Collateral, including any Collateral consisting of cash, as follows;


 


FIRST, to the payment of all costs and expenses
incurred by the Administrative Agent or the Collateral Agent (in their
respective capacities as such hereunder or under any other Loan Document) in
connection with such collection, sale, foreclosure or realization or otherwise
in connection with this Agreement, any other Loan Document or any of the
Obligations, including all court costs and the fees and expenses of its agents
and legal counsel, the repayment of all advances made by the Administrative Agent
and/or the


 


26

















 


Collateral
Agent hereunder or under any other Loan Document on behalf of any Grantor and
any other costs or expenses incurred in connection with the exercise of any
right or remedy hereunder or under any other Loan Document;


 


SECOND, to the payment in full of Unfunded
Advances/Participations (the amounts so applied to be distributed between or
among the Administrative Agent, the Swingline Lender and any Issuing Bank pro
rata in accordance with the amounts of Unfunded Advances/Participations owed to
them on the date of any such distribution);


 


THIRD, to the payment in full of all other Obligations
(the amounts so applied to be distributed among the Secured Parties pro rata in
accordance with the amounts of the Obligations owed to them on the date of any
such distribution);


 


FOURTH, to the Grantors, their successors or assigns,
or as a court of competent jurisdiction may otherwise direct.


 


The Collateral Agent
shall have absolute discretion as to the time of application of any such
proceeds, moneys or balances in accordance with this Agreement. Upon any sale
of Collateral by the Collateral Agent (including pursuant to a power of sale
granted by statute or under a judicial proceeding), the receipt of the
Collateral Agent or of the officer making the sale shall be a sufficient
discharge to the purchaser or purchasers of the Collateral so sold and such
purchaser or purchasers shall not be obligated to see to the application of any
part of the purchase money paid over to the Collateral Agent or such officer or
be answerable in any way for the misapplication thereof.


 


SECTION 5.03.
Grant of License to Use
Intellectual Property.   For the purpose of enabling the
Collateral Agent to exercise rights and remedies under this Agreement at such
time as the Collateral Agent shall be lawfully entitled to exercise such rights
and remedies, each Grantor hereby grants to the Collateral Agent an
irrevocable, nonexclusive license (exercisable without payment of royalty or
other compensation to the Grantors), to use, license or sublicense any of the Article 9
Collateral consisting of Intellectual Property now owned or hereafter acquired
by such Grantor, and wherever the same may be located, and including in such
license access to all media in which any of the licensed items may be recorded
or stored and to all computer software and programs used for the compilation or
printout thereof. The use of such license by the Collateral Agent may be
exercised, at the option of the Collateral Agent, only upon the occurrence and
during the continuation of an Event of Default; provided, however, that any license, sublicense or other
transaction entered into by the Collateral Agent in accordance herewith shall
be binding upon each Grantor notwithstanding any subsequent cure of an Event of
Default.


 


SECTION 5.04. Securities Act, Etc.   In view of the position of the
Grantors in relation to the Pledged Collateral, or because of other current or
future circumstances, a question may arise under the U.S. Securities Act of
1933, as now or hereafter in effect, or any similar statute hereafter enacted
analogous in purpose or effect (such Act and any such similar statute as from
time to time in effect being called the


 


27














 


“Federal Securities Laws”)  with
respect to any disposition of the Pledged Collateral permitted hereunder. Each
Grantor understands that compliance with the Federal Securities Laws might very
strictly limit the course of conduct of the Collateral Agent if the Collateral
Agent were to attempt to dispose of all or any part of the Pledged Collateral,
and might also limit the extent to which or the manner in which any subsequent
transferee of any Pledged Collateral could dispose of the same. Similarly,
there may be other legal restrictions or limitations affecting the Collateral
Agent in any attempt to dispose of all or part of the Pledged Collateral under
applicable “blue sky” or other state securities laws or similar laws analogous
in purpose or effect. Each Grantor recognizes that in light of such
restrictions and limitations the Collateral Agent may, with respect to any sale
of the Pledged Collateral, limit the purchasers to those who will agree, among
other things, to acquire such Pledged Collateral for their own account, for
investment, and not with a view to the distribution or resale thereof. Each
Grantor acknowledges and agrees that in light of such restrictions and
limitations, the Collateral Agent, in its sole and absolute discretion (a) may
proceed to make such a sale whether or not a registration statement for the
purpose of registering such Pledged Collateral or part thereof shall have been
filed under the Federal Securities Laws and (b) may approach and negotiate
with a limited number of potential purchasers (including a single potential
purchaser) to effect such sale. Each Grantor acknowledges and agrees that any
such sale might result in prices and other terms less favorable to the seller
than if such sale were a public sale without such restrictions. In the event of
any such sale, the Collateral Agent shall incur no responsibility or liability
for selling all or any part of the Pledged Collateral at a price that the
Collateral Agent, in its sole and absolute discretion, may in good faith deem
reasonable under the circumstances, notwithstanding the possibility that a
substantially higher price might have been realized if the sale were deferred
until after registration as aforesaid or if more than a limited number of
purchasers (or a single purchaser) were approached. The provisions of this Section 5.04
will apply notwithstanding the existence of a public or private market upon
which the quotations or sales prices may exceed substantially the price at
which the Collateral Agent sells.


 


ARTICLE VI 


 


Indemnity, Subrogation and
Subordination


 


SECTION 6.01. Indemnity and Subrogation. 
 In addition to all such rights of
indemnity and subrogation as the Guarantors may have under applicable law (but
subject to Section 6.03), the Borrower agrees that (a) in the event a
payment shall be made by any Guarantor under this Agreement, the Borrower shall
indemnify such Guarantor for the full amount of such payment and such Guarantor
shall be subrogated to the rights of the person to whom such payment shall have
been made to the extent of such payment and (b) in the event any assets of
any Guarantor shall be sold pursuant to this Agreement or any other Security
Document to satisfy in whole or in part a claim of any Secured Party, the
Borrower shall indemnify such Guarantor in an amount equal to the greater of
the book value or the fair market value of the assets so sold.


 


28

















 


SECTION 6.02.
 Contribution
and Subrogation.  Each Guarantor (a “Contributing Guarantor”)  agrees
(subject to Section 6.03) that, in the event a payment shall be made by
any other Guarantor hereunder in respect of any Obligation, or assets of any
other Guarantor shall be sold pursuant to any Security Document to satisfy any
Obligation owed to any Secured Party, and such other Guarantor (the “Claiming
Guarantor”)  shall not have been fully
indemnified by the Borrower as provided in Section 6.01, the Contributing
Guarantor shall indemnify the Claiming Guarantor in an amount equal to (i) the
amount of such payment or (ii) the greater of the book value or the fair
market value of such assets, as the case may be, in each case multiplied by a
fraction of which the numerator shall be the net worth of the Contributing
Guarantor on the date hereof and the denominator shall be the aggregate net
worth of all the Guarantors on the date hereof (or, in the case of any
Guarantor becoming a party hereto pursuant to Section 7.16, the date of
the supplement hereto executed and delivered by such Guarantor). Any
Contributing Guarantor making any payment to a Claiming Guarantor pursuant to
this Section 6.02 shall be subrogated to the rights of such Claiming
Guarantor under Section 6.01 to the extent of such payment.


 


SECTION 6.03.
 Subordination.  (a) Notwithstanding
any provision of this Agreement to the contrary, all rights of the Guarantors
under Sections 6.01 and 6.02 and all other rights of indemnity, contribution or
subrogation under applicable law or otherwise shall be fully subordinated to
the indefeasible payment in full in cash of the Obligations. No failure on the
part of the Borrower or any Guarantor to make the payments required by Sections
6.01 and 6.02 (or any other payments required under applicable law or
otherwise) shall in any respect limit the obligations and liabilities of any
Guarantor with respect to its obligations hereunder, and each Guarantor shall
remain liable for the full amount of its obligations hereunder.


 


(b) The
Borrower and each Guarantor hereby agree that all Indebtedness and other
monetary obligations owed by it to any Subsidiary that is not a Loan Party (or,
in the case of the Borrower, any Subsidiary) shall be fully subordinated to the
indefeasible payment in full in cash of the Obligations, it being agreed that,
for greater certainty, other than upon the occurrence and during the
continuance of an Event of Default, the Borrower and each Guarantor shall be
allowed to make payments with respect to Indebtedness permitted to be incurred
pursuant to Section 6.01 of the Credit Agreement in accordance with the
terms thereof.


 


ARTICLE VII 


 


Miscellaneous


 


SECTION 7.01.
 Notices.   All communications and notices
hereunder shall (except as otherwise expressly permitted herein) be in writing
and given as provided in Section 9.01 of the Credit Agreement. All
communications and notices hereunder to any Subsidiary Guarantor shall be given
to it in care of the Borrower as provided in Section 9.01 of the Credit
Agreement.


 


29

















 


SECTION 7.02. Security Interest Absolute.  All rights of the Collateral Agent
hereunder, the Security Interest, the grant of a security interest in the
Pledged Collateral and all obligations of each Grantor hereunder shall be
absolute and unconditional irrespective of (a) any lack of validity or
enforceability of the Credit Agreement, any other Loan Document, any agreement
with respect to any of the Obligations or any other agreement or instrument
relating to any of the foregoing, (b) any change in the time, manner or
place of payment of, or in any other term of, all or any of the Obligations, or
any other amendment or waiver of or any consent to any departure from the
Credit Agreement, any other Loan Document or any other agreement or instrument
relating to the foregoing, (c) any exchange, release or non-perfection of
any Lien on other collateral, or any release or amendment or waiver of or
consent under or departure from any guarantee, securing or guaranteeing all or
any of the Obligations, or (d) any other circumstance that might otherwise
constitute a defense available to, or a discharge of, any Grantor in respect of
the Obligations or this Agreement.


 


SECTION 7.03.
Survival of Agreement. All covenants, agreements,
representations and warranties made by the Loan Parties in the Loan Documents and
in the certificates or other instruments prepared or delivered in connection
with or pursuant to this Agreement or any other Loan Document shall be
considered to have been relied upon by the Lenders and the Issuing Bank and
shall survive the execution and delivery of the Loan Documents and the making
of any Loans and issuance of any Letters of Credit, regardless of any
investigation made by any Lender or Issuing Bank or on their behalf and
notwithstanding that the Collateral Agent, any Issuing Bank or any Lender may
have had notice or knowledge of any Default or incorrect representation or
warranty at the time any credit is extended under the Credit Agreement, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any fee or any other amount payable under any
Loan Document is outstanding and unpaid or the aggregate L/C Exposure does not
equal zero and so long as the Commitments have not expired or terminated.


 


SECTION 7.04. Binding Effect; Several Agreement.  This Agreement shall become effective as
to any Loan Party when a counterpart hereof executed on behalf of such Loan
Party shall have been delivered to the Collateral Agent and a counterpart
hereof shall have been executed on behalf of the Collateral Agent, and
thereafter shall be binding upon such Loan Party and the Collateral Agent and
their respective permitted successors and assigns, and shall inure to the
benefit of such Loan Party, the Collateral Agent and the other Secured Parties
and their respective successors and assigns, except that no Loan Party shall
have the right to assign or transfer its rights or obligations hereunder or any
interest herein or in the Collateral (and any such assignment or transfer shall
be void) except as expressly contemplated or permitted by this Agreement or the
Credit Agreement. This Agreement shall be construed as a separate agreement
with respect to each Loan Party and may be amended, modified, supplemented,
waived or released with respect to any Loan Party without the approval of any
other Loan Party and without affecting the obligations of any other Loan Party
hereunder.


 


SECTION 7.05.  Successors and Assigns.  Whenever in this Agreement any of the
parties hereto is referred to, such reference shall be deemed to include the


 


30

















 


permitted successors and
assigns of such party; and all covenants, promises and agreements by or on
behalf of any Grantor or the Collateral Agent that are contained in this
Agreement shall bind and inure to the benefit of their respective successors
and assigns.


 


SECTION 7.06.
Collateral Agent’s Fees and
Expenses; Indemnification.(a) The parties hereto agree that
the Collateral Agent shall be entitled to reimbursement of its expenses
incurred hereunder as provided in Section 9.05 of the Credit Agreement.


 


(b) Without limitation of its indemnification
obligations under the other Loan Documents, each Grantor jointly and severally
agrees to indemnify the Collateral Agent and the other indemnitees against, and
hold each indemnitee harmless from, any and all losses, claims, damages,
liabilities, and related out of pocket expenses, including the fees, charges
and disbursements of any counsel for any indemnitee, incurred by or asserted
against any indemnitee arising out of, in any way connected with, or as a
result of, the execution, delivery or performance of this Agreement or any
agreement or instrument contemplated hereby or any claim, litigation,
investigation or proceeding relating to any of the foregoing or to the
Collateral, regardless of whether any indemnitee is a party thereto or whether
initiated by a third party or by a Loan Party or any Affiliate thereof; provided, however, that such indemnity
shall not, as to any indemnitee, be available to the extent that such losses,
claims, damages, liabilities or related expenses are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted
from the gross negligence or wilful misconduct of such indemnitee. To the
extent permitted by applicable law, no Grantor shall assert, and each Grantor
hereby waives any claim against any indemnitee, on any theory of liability, for
special, indirect, consequential or punitive damages (as opposed to direct or
actual damages) arising out of, in connection with, or as a result of, this
Agreement or any agreement or instrument contemplated hereby, the Transactions,
any Loan or Letter of Credit or the use of proceeds thereof.


 


(c) Any
such amounts payable as provided hereunder shall be additional Obligations
secured hereby and by the other Security Documents. The provisions of this Section 7.06
shall remain operative and in full force and effect regardless of the
termination of this Agreement or any other Loan Document, the consummation of
the transactions contemplated hereby, the repayment of any of the Obligations,
the invalidity or unenforceability of any term or provision of this Agreement
or any other Loan Document, or any investigation made by or on behalf of the
Collateral Agent or any other Secured Party. All amounts due under this Section 7.06
shall be payable on written demand therefor and shall bear interest, on and
from the date of demand, at the rate specified in Section 2.06(a) of
the Credit Agreement.


 


SECTION 7.07.
Collateral Agent Appointed
Attorney-in-Fact.  Each
Grantor hereby appoints the Collateral Agent as the attorney-in-fact of such
Grantor for the purpose of carrying out the provisions of this Agreement and
taking any action and executing any instrument that the Collateral Agent may
deem necessary or advisable to accomplish the purposes hereof, which
appointment is irrevocable and coupled with an interest. Without limiting the
generality of the foregoing, the Collateral Agent shall have the right, upon
the occurrence and during the continuance of an Event of Default, with


 


31

















 


full power of
substitution either in the Collateral Agent’s name or in the name of such
Grantor (a) to receive, endorse, assign and/or deliver any and all notes,
acceptances, checks, drafts, money orders or other evidences of payment
relating to the Collateral or any part thereof, (b) to demand, collect,
receive payment of, give receipt for and give discharges and releases of all or
any of the Collateral, (c) to sign the name of any Grantor on any invoice
or bill of lading relating to any of the Collateral, (d) to send
verifications of Accounts Receivable to any Account Debtor, (e) to
commence and prosecute any and all suits, actions or proceedings at law or in
equity in any court of competent jurisdiction to collect or otherwise realize
on all or any of the Collateral or to enforce any rights in respect of any
Collateral, (f) to settle, compromise, compound, adjust or defend any actions,
suits or proceedings relating to all or any of the Collateral, (g) to
notify, or to require any Grantor to notify, Account Debtors to make payment
directly to the Collateral Agent, and (h) to use, sell, assign, transfer,
pledge, make any agreement with respect to or otherwise deal with all or any of
the Collateral, and to do all other acts and things necessary to carry out the
purposes of this Agreement in accordance with its terms, as fully and
completely as though the Collateral Agent were the absolute owner of the
Collateral for all purposes; provided,
however, that nothing herein contained shall be construed as
requiring or obligating the Collateral Agent to make any commitment or to make
any inquiry as to the nature or sufficiency of any payment received by the Collateral
Agent, or to present or file any claim or notice, or to take any action with
respect to the Collateral or any part thereof or the moneys due or to become
due in respect thereof or any property covered thereby. The Collateral Agent
and the other Secured Parties shall be accountable only for amounts actually
received as a result of the exercise of the powers granted to them herein, and
neither they nor their officers, directors, employees or agents shall be
responsible to any Grantor for any act or failure to act hereunder, except for
their own gross negligence, wilful misconduct or bad faith. Notwithstanding
anything to the contrary in this Section 7.07, the Collateral Agent agrees
that it will not exercise any rights under the power of attorney provided for
herein unless an Event of Default shall have occurred and be continuing.


 


SECTION 7.08.
 Applicable Law.   THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.


 


SECTION 7.09.
Waivers; Amendment.  (a) No failure or delay by the
Collateral Agent, the Administrative Agent, any Issuing Bank or any Lender in
exercising any right or power hereunder or under any other Loan Document shall
operate as a waiver hereof or thereof, nor shall any single or partial exercise
of any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof
or the exercise of any other right or power. The rights and remedies of the
Collateral Agent, the Administrative Agent, the Issuing Banks and the Lenders
hereunder and under the other Loan Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have. No waiver
of any provision of any Loan Document or consent to any departure by any Loan
Party therefrom shall in any event be effective unless the same shall be
permitted by paragraph (b) of this Section 7.09, and then such waiver
or consent shall be effective only in the specific instance and for the purpose
for which given.  Without limiting the


 


32

















 


generality of the
foregoing, the making of a Loan or issuance of a Letter of Credit shall not be
construed as a waiver of any Default, regardless of whether the Collateral
Agent, any Lender or any Issuing Bank may have had notice or knowledge of such
Default at the time. No notice or demand on any Loan Party in any case shall
entitle any Loan Party to any other or further notice or demand in similar or
other circumstances.


 


(b) Neither
this Agreement nor any provision hereof may be waived, amended or modified
except pursuant to an agreement or agreements in writing entered into by the
Collateral Agent and the Loan Party or Loan Parties with respect to which such waiver,
amendment or modification is to apply, subject to any consent required in
accordance with Section 9.08 of the Credit Agreement.


 


SECTION 7.10.
WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT
OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT
SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE
FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO
HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS, AS
APPLICABLE, BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN
THIS SECTION 7.10.


 


SECTION 7.11.
Severability. In the event any one or more of the
provisions contained in this Agreement or in any other Loan Document should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and therein
shall not in any way be affected or impaired thereby (it  being understood that the invalidity of a
particular provision in a particular jurisdiction shall not in and of itself
affect the validity of such provision in any other jurisdiction). The parties
shall endeavor in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.


 


SECTION 7.12.
Counterparts.  This Agreement may be executed in
counterparts (and by different parties hereto on different counterparts), each
of which shall constitute an original but all of which when taken together
shall constitute a single contract, and shall become effective as provided in Section 7.04.
Delivery of an executed signature page to this Agreement by facsimile
transmission shall be as effective as delivery of a manually signed counterpart
of this Agreement.


 


SECTION 7.13.
Headings.  Article and Section headings
and the Table of Contents used herein are for convenience of reference only,
are not part of this


 


33

















 


Agreement and are not to
affect the construction of, or to be taken into consideration in interpreting,
this Agreement.


 


SECTION 7.14.
Jurisdiction; Consent to Service
of Process.  (a) Each party hereto hereby
irrevocably and unconditionally submits, for itself and its property, to the
exclusive jurisdiction of any New York State court or Federal court of the
United States of America, sitting in New York City, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to
this Agreement or any other Loan Document, or for recognition or enforcement of
any judgment, and each party hereto hereby irrevocably and unconditionally
agrees that all claims in respect of any such action or proceeding may be heard
and determined in such New York State or, to the extent permitted by law, in
such Federal court. Each party hereto agrees that a final judgment in any such
action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
Nothing in this Agreement or any other Loan Document shall affect any right
that the Collateral Agent, the Administrative Agent, any Issuing Bank or any
Lender may otherwise have to bring any action or proceeding relating to this
Agreement or any other Loan Document against any Grantor or its properties in
the courts of any jurisdiction.


 


(b)  Each party hereto hereby
irrevocably and unconditionally waives, to the fullest extent it may legally
and effectively do so, any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to
this Agreement or any other Loan Document in any court referred to in paragraph
(a) of this Section 7.14. Each party hereto hereby irrevocably
waives, to the fullest extent permitted by law, the defense of an inconvenient
forum to the maintenance of such action or proceeding in any such court.


 


(c)  Each party hereto hereby
irrevocably consents to service of process in the manner provided for notices
in Section 7.01. Nothing in this Agreement or any other Loan Document will
affect the right of the Collateral Agent to serve process in any other manner
permitted by law.


 


SECTION 7.15.
Termination or Release.  (a) This Agreement, the guarantees
made herein, the Security Interest, the pledge of the Pledged Collateral and
all other security interests granted hereby shall terminate when all the Loan
Document Obligations have been indefeasibly paid in full and the Lenders have
no further commitment to lend under the Credit Agreement, the aggregate L/C
Exposure has been reduced to zero (or cash collateralized on terms reasonably
acceptable to the Administrative Agent and the Issuing Bank) and the Issuing
Banks have no further obligations to issue Letters of Credit under the Credit
Agreement.


 


(b) A
Subsidiary Guarantor shall automatically be released from its obligations
hereunder and the Security Interests created hereunder in the Collateral of
such Subsidiary Guarantor shall be automatically released upon the consummation
of any transaction permitted by the Credit Agreement as a result of which such
Subsidiary Guarantor ceases to be a Subsidiary.


 


34

















 


(c) Upon any sale or other transfer by any
Grantor of any Collateral that is permitted under the Credit Agreement
to any person that is not the Borrower or a Guarantor, or, upon the
effectiveness of any written consent to the release of the Security Interest
granted hereby in any Collateral pursuant to Section 9.08 of the Credit
Agreement, the Security Interest in such Collateral shall be automatically
released.


 


(d) In
connection with any termination or release pursuant to paragraph (a), (b) or
(c) above, the Collateral Agent shall promptly execute and deliver to any
Grantor, at such Grantor’s expense, all Uniform Commercial Code termination
statements and similar documents that such Grantor shall reasonably request to
evidence such termination or release. Any execution and delivery of documents
pursuant to this Section 7.15 shall be without recourse to or
representation or warranty by the Collateral Agent or any Secured Party.
Without limiting the provisions of Section 7.06, the Borrower shall
reimburse the Collateral Agent upon demand for all costs and out of pocket
expenses, including the fees, charges and expenses of counsel, incurred by it
in connection with any action contemplated by this Section 7.15.


 


SECTION 7.16.
Additional Subsidiaries.  Any Subsidiary that is required to become
a party hereto pursuant to Section 5.11 of the Credit Agreement shall
enter into this Agreement as a Subsidiary Guarantor and a Grantor upon becoming
such a Subsidiary. Upon execution and delivery by the Collateral Agent and such
Subsidiary of a supplement in the form of Exhibit A hereto, such Subsidiary
shall become a Subsidiary Guarantor and a Grantor hereunder with the same force
and effect as if originally named as a Subsidiary Guarantor and a Grantor
herein The execution and delivery of any such instrument shall not require the
consent of any other Loan Party hereunder. The rights and obligations of each
Loan Party hereunder shall remain in full force and effect notwithstanding the
addition of any new Loan Party as a party to this Agreement.


 


SECTION 7.17.
Right of Setoff. If an Event of Default shall have
occurred and is continuing, each Secured Party is hereby authorized at any time
and from time to time, to the fullest extent permitted by law, to set off and
apply any and all Collateral (including any deposits (general or special, time
or demand, provisional or final)) at any time held and other obligations at any
time owing by such Secured Party to or for the credit or the account of any Grantor
against any and all of the obligations of such Grantor now or hereafter
existing under this Agreement and the other Loan Documents held by such Secured
Party, irrespective of whether or not such Secured Party shall have made any
demand under this Agreement or any other Loan Document and although such
obligations may be unmatured.  The rights
of each Secured Party under this Section 7.17 are in addition to other
rights and remedies (including other rights of setoff) which such Secured Party
may have.


 


[Remainder of page intentionally left blank]


 


35

















 


IN WITNESS WHEREOF, the parties hereto have duly
executed this Agreement as of the day and year first above written.


 


	
   

  	
  STR
  ACQUISITION, INC.,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Jason Metakis

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Jason
  Metakis

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  STR
  HOLDINGS LLC, 

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Jason Metakis

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Jason
  Metakis

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Treasurer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SPECIALIZED
  TECHNOLOGY 

  RESOURCES, INC.,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Barry
  A. Morris

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Secretary

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  CAL
  SAFETY COMPLIANCE 

  CORPORATION,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Barry
  A. Morris

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Assistant
  Secretary

  



 


[First Lien Guarantee and Collateral Agreement]


 

















 


	
   

  	
  SPECIALIZED
  TECHNOLOGY

  RESOURCES (INTERNATIONAL), INC.,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Barry
  A. Morris

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Secretary

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SHUSTER
  LABORATORIES, INC.,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Barry
  A. Morris

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Secretary

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SUPPLY
  CHAIN CONSULTING 

  SERVICES CORPORATION,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SPECIALIZED
  TECHNOLOGY 

  RESOURCES (FLORIDA), INC.,

  
	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Barry
  A. Morris

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Secretary

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  STR
  MATERIALS SCIENCE, INC.,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Barry A. Morris

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Barry
  A. Morris

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Secretary

  



 


[First Lien Guarantee and Collateral Agreement]


 

















 


	
   

  	
  SUPPLY
  CHAIN CONSULTING 

  SERVICES CORPORATION

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Thomas D. Vitro

  
	
   

  	
   

  	
   

  	
  Name:
  Thomas D. Vitro

  
	
   

  	
   

  	
   

  	
  Title: Assistant
  Secretary

  



 


[First Lien Guarantee and Collateral Agreement]


 

















 


	
   

  	
  CREDIT
  SUISSE, CAYMAN ISLANDS 

  BRANCH, as Collateral Agent,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ Rianka Mohan

  
	
   

  	
   

  	
   

  	
  Name:

  	
  RIANKA
  MOHAN

  
	
   

  	
   

  	
   

  	
  Title:

  	
  VICE
  PRESIDENT

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ James Neira

  
	
   

  	
   

  	
   

  	
  Name:  JAMES
  NEIRA

  
	
   

  	
   

  	
   

  	
  Title:   ASSOCIATE

  



 


[First Lien Guarantee and Collateral Agreement]