ex104-tlguarantyandsecur






Execution Version  12445098v4 4/2/2021 9:02 AM 1989.726      122895846v5  GUARANTY AND SECURITY AGREEMENT  This GUARANTY AND SECURITY AGREEMENT (this "Agreement"), dated as of  April 26, 2021, by and among the Persons listed on the signature pages hereof as "Grantors" and  those additional entities that hereafter become parties hereto by executing the form of Joinder  attached hereto as Annex 1 (each, a "Grantor" and collectively, the "Grantors"), and MGG  INVESTMENT GROUP LP, a Delaware limited partnership ("MGG"), in its capacity as  administrative agent for each member of the Lender Group (in such capacity, together with its  successors and assigns in such capacity, "Agent").  W I T N E S S E T H:  WHEREAS, pursuant to that certain Credit Agreement, of even date herewith (as  amended, restated, supplemented, or otherwise modified from time to time, the "Credit  Agreement"), by and among FARMER BROS. CO., a Delaware corporation ("Parent"), and the  Subsidiaries of Parent from time to time party to the Credit Agreement as borrowers in accordance  with the terms thereof (together with Parent, each a "Borrower" and individually and collectively,  jointly and severally, the "Borrowers"), the lenders party thereto as "Lenders" (each of such  Lenders, together with its successors and permitted assigns, is referred to hereinafter as a  "Lender"), and Agent, the Lender Group has agreed to make certain financial accommodations  available to Borrowers from time to time pursuant to the terms and conditions thereof;   WHEREAS, Agent has agreed to act as agent for the benefit of the Lender Group in  connection with the transactions contemplated by the Credit Agreement and this Agreement;  WHEREAS, in order to induce the Lender Group to enter into the Credit Agreement and  the other Loan Documents, extend the Loans thereunder and make financial accommodations to  Borrowers as provided for in the Credit Agreement and the other Loan Documents, (a) each  Grantor (other than any Borrower) has agreed to guaranty the Guarantied Obligations, and (b) each  Grantor has agreed to grant to Agent, for the benefit of the Lender Group, a continuing security  interest in and to the Collateral in order to secure the prompt and complete payment, observance  and performance of, among other things, the Secured Obligations; and  WHEREAS, each Grantor will benefit by virtue of the financial accommodations extended  to Borrowers by the Lender Group.  NOW, THEREFORE, for and in consideration of the recitals made above and other good  and valuable consideration, the receipt, sufficiency and adequacy of which are hereby  acknowledged, the parties hereto agree as follows:  1. Definitions; Construction.  (a) All initially capitalized terms used herein (including in the preamble and  recitals hereof) without definition shall have the meanings ascribed thereto in the Credit  Agreement.  Any terms (whether capitalized or lower case) used in this Agreement that are defined  in the Code (including, without limitation, Account, Account Debtor, Chattel Paper, Commercial  Tort Claims, Deposit Account, Drafts, Documents, Equipment, Farm Products, Fixtures, General  





 






  -2-  122895846v5  Intangibles, Inventory, Investment Property, Instruments, Letters of Credit, Letter of Credit Rights,  Promissory Notes, Proceeds, Securities Account and Supporting Obligations) shall be construed  and defined as set forth in the Code unless otherwise defined herein or in the Credit Agreement;  provided, that to the extent that the Code is used to define any term used herein and if such term  is defined differently in different Articles of the Code, the definition of such term contained in  Article 9 of the Code shall govern.  In addition to those terms defined elsewhere in this Agreement,  as used in this Agreement, the following terms shall have the following meanings:  (i) "Acquisition Documents" means the agreements, instruments and  documents evidencing, or entered into in connection with, an Acquisition (including a Permitted  Acquisition) by a Grantor.  (ii) "Activation Instruction" has the meaning specified therefor in Section  7(k) hereof.  (iii) "Agent" has the meaning specified therefor in the preamble to this  Agreement.  (iv) "Agreement" has the meaning specified therefor in the preamble to  this Agreement.  (v) "Books" means books and records (including each Grantor's Records  indicating, summarizing, or evidencing such Grantor's assets (including the Collateral) or  liabilities, each Grantor's Records relating to such Grantor's business operations or financial  condition, and each Grantor's goods or General Intangibles related to such information).  (vi) "Borrower" and "Borrowers" have the respective meanings specified  therefor in the recitals to this Agreement.  (vii) "Cash Dominion Event" means the occurrence of either of the  following:  (A) the occurrence and continuance of any Event of Default, or (B) Excess Availability  is less than the greater of (x) 12.5% of the Line Cap and (y) $10,000,000 at any time.  (viii) "Cash Dominion Period" means the period commencing after the  occurrence of a Cash Dominion Event and continuing until the date when (A) no Event of Default  shall exist and be continuing, and (B) Excess Availability is greater than $10,000,000 for 30  consecutive days.  (ix) "Code" means the New York Uniform Commercial Code, as in effect  from time to time; provided, that in the event that, by reason of mandatory provisions of law, any  or all of the attachment, perfection, priority, or remedies with respect to Agent's Lien on any  Collateral is governed by the Uniform Commercial Code as enacted and in effect in a jurisdiction  other than the State of New York, the term "Code" shall mean the Uniform Commercial Code as  enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating  to such attachment, perfection, priority, or remedies.  (x) "Collateral" has the meaning specified therefor in Section 3 hereof.  





 






  -3-  122895846v5  (xi) "Collection Account" means a Deposit Account of a Grantor which is  used exclusively for deposits of collections and proceeds of Collateral and not as a disbursement  or operating account upon which checks or other drafts may be drawn.  (xii) "Commercial Tort Claims" means commercial tort claims (as that  term is defined in the Code), and includes those commercial tort claims listed on Schedule 1.  (xiii) "Commodity Exchange Act" means the Commodity Exchange Act (7  U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.  (xiv) "Controlled Account" has the meaning specified therefor in Section  7(k) hereof.  (xv) "Controlled Account Agreements" means those certain cash  management agreements, in form and substance satisfactory to Agent in its Permitted Discretion,  each of which is executed and delivered by a Grantor, Agent, and one of the Controlled Account  Banks.  (xvi) "Controlled Account Bank" has the meaning specified therefor in  Section 7(k) hereof.  (xvii) "Copyrights" means any and all rights in any works of authorship,  including (A) copyrights and moral rights, (B) copyright registrations and recordings thereof and  all applications in connection therewith including those listed on Schedule 2, (C) income, license  fees, royalties, damages, and payments now and hereafter due or payable under and with respect  thereto, including payments under all licenses entered into in connection therewith and damages  and payments for past, present, or future infringements thereof, (D) the right to sue for past,  present, and future infringements thereof, and (E) all of each Grantor's rights corresponding thereto  throughout the world.  (xviii) "Copyright Security Agreement" means each Copyright Security  Agreement executed and delivered by Grantors, or any of them, and Agent, in substantially the  form of Exhibit A.  (xix) "Credit Agreement" has the meaning specified therefor in the recitals  to this Agreement.  (xx) "Excluded Accounts" means (A) Deposit Accounts and Securities  Accounts (x) with an amount on deposit in any individual Deposit Account or Securities Account  of not more than $50,000 at any one time and (y) with an aggregate amount on deposit for all such  Deposit Accounts and Securities Accounts taken together of not more than $250,000 at any one  time, (B) Deposit Accounts specially and exclusively used for payroll, payroll taxes and other  employee wage and benefit payments to or for any Grantor's employees; provided, that the amount  on deposit in the Deposit Accounts of this clause (B) does not exceed the current amount of such  payroll, payroll taxes and other employee wage and benefit obligations, (C) Deposit Accounts  specially and exclusively used for taxes, including sales taxes; provided, that the amount on deposit  in the Deposit Accounts of this clause (C) does not exceed the current amount of such tax  obligations, (D) the Excluded L/C Account; provided that the aggregate amount of cash collateral  





 






  -4-  122895846v5  and cash in Excluded L/C Account does not exceed 105% of the face amount of the Existing  Letters of Credit, (E) the Excluded Banking Services Account; provided that the aggregate amount  of cash collateral and cash in Excluded Banking Services Account does not exceed$250,000.00,  and (F) Deposit Accounts used solely for the hedging of green coffee pricing (including (i) Deposit  Account number 9387 maintained by Parent at StoneX Markets, LLC, (ii) Deposit Account  number MIC-H2601 maintained by Parent at StoneX Financial Inc., and (iii) Deposit Account  number 52319040 maintained by Parent at Macquarie Futures USA LLC), which Deposit  Accounts have a 30-day average balance of less than $250,000 in the aggregate for all such Deposit  Accounts.  (xxi) "Excluded Swap Obligation" means, with respect to any Grantor, any  Swap Obligation if, and to the extent that, all or a portion of the guaranty of such Grantor of  (including by virtue of the joint and several liability provisions of Section 2.15 of the Credit  Agreement with respect to any Grantor that is a Borrower), or the grant by such Grantor of a  security interest to secure, such Swap Obligation (or any guaranty thereof) is or becomes illegal  under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures  Trading Commission (or the application or official interpretation of any thereof) by virtue of such  Grantor's failure for any reason to constitute an "eligible contract participant" as defined in the  Commodity Exchange Act and the regulations thereunder at the time the guaranty of such Grantor  or the grant of such security interest becomes effective with respect to such Swap Obligation.  If a  Swap Obligation arises under a master agreement governing more than one swap, such exclusion  shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such  guaranty or security interest is or becomes illegal.  (xxii) "Foreclosed Grantor" has the meaning specified therefor in Section  2(i)(iv) hereof.  (xxiii) "Gem Note" means that certain Broker Agreement and Note, dated as  of April 1, 2019, by and between Parent, as Seller or Noteholder, and Florida Seminole Coffee  Company, Inc., a Florida corporation, as Broker or Maker.  (xxiv) "General Intangibles" means general intangibles (as that term is  defined in the Code), and includes payment intangibles, software, contract rights, rights to  payment, rights under Hedge Agreements (including the right to receive payment on account of  the termination (voluntarily or involuntarily) of such Hedge Agreements), rights arising under  common law, statutes, or regulations, choses or things in action, goodwill, Intellectual Property,  Intellectual Property Licenses, purchase orders, customer lists, route lists, rights to payment and  other rights under Acquisition Documents, rights to payment and other rights under any royalty or  licensing agreements, including Intellectual Property Licenses, infringement claims, monies due  or recoverable from pension funds, pension plan refunds, pension plan refund claims, insurance  premium rebates, tax refunds, and tax refund claims, interests in a partnership or limited liability  company which do not constitute a security under Article 8 of the Code, and any other personal  property other than Commercial Tort Claims, money, Accounts, Chattel Paper, Deposit Accounts,  goods, Investment Property, Negotiable Collateral, and oil, gas, or other minerals before  extraction.  





 






  -5-  122895846v5  (xxv) "Grantor" and "Grantors" have the respective meanings specified  therefor in the preamble to this Agreement.  (xxvi) "Guarantied Obligations" means all of the Obligations now or  hereafter existing, whether for principal, interest (including any interest that accrues after the  commencement of an Insolvency Proceeding, regardless of whether allowed or allowable in whole  or in part as a claim in any such Insolvency Proceeding), fees (including the fees provided for in  the Fee Letter), Lender Group Expenses (including any fees or expenses payable under the Loan  Documents that accrue after the commencement of an Insolvency Proceeding, regardless of  whether allowed or allowable in whole or in part as a claim in any such Insolvency Proceeding),  or otherwise, and any and all documented expenses (including reasonable and documented counsel  fees and expenses) incurred by Agent or any other member of the Lender Group in enforcing any  rights under the any of the Loan Documents.  Without limiting the generality of the foregoing,  Guarantied Obligations shall include all amounts that constitute part of the Guarantied Obligations  and would be owed by any Borrower to Agent or any other member of the Lender Group but for  the fact that they are unenforceable or not allowable, including due to the existence of a  bankruptcy, reorganization, other Insolvency Proceeding or similar proceeding involving any  Borrower or any guarantor; provided that, anything to the contrary contained in the foregoing  notwithstanding, the Guarantied Obligations shall exclude any Excluded Swap Obligation.  (xxvii) "Guarantor" means each Grantor other than any Borrower.  (xxviii) "Guaranty" means the guaranty set forth in Section 2 hereof.  (xxix) "Intellectual Property" means any and all Patents, Copyrights,  Trademarks, trade secrets, know-how, inventions (whether or not patentable), algorithms, software  programs (including source code and object code), processes, product designs, industrial designs,  blueprints, drawings, data, customer lists, URLs and domain names, specifications,  documentations, reports, catalogs, literature, and any other forms of technology or proprietary  information of any kind, including all rights therein and all applications for registration or  registrations thereof.  (xxx) "Intellectual Property Licenses" means, with respect to any Grantor,  (A) any licenses or other similar rights provided to such Grantor in or with respect to Intellectual  Property owned or controlled by any other Person, and (B) any licenses or other similar rights  provided to any other Person in or with respect to Intellectual Property owned or controlled by  such Grantor, in each case, including (x) any software license agreements (other than license  agreements for commercially available off-the-shelf software that is generally available to the  public which have been licensed to a Grantor pursuant to end-user licenses), (y) the license  agreements listed on Schedule 3, and (z) the right to use any of the licenses or other similar rights  described in this definition in connection with the enforcement of the Lender Group's rights under  the Loan Documents.  (xxxi) "Investment Property" means (A) any and all investment property,  and (B) any and all of the following (regardless of whether classified as investment property under  the Code):  all Pledged Interests, Pledged Operating Agreements, and Pledged Partnership  Agreements.  





 






  -6-  122895846v5  (xxxii) "Joinder" means each Joinder to this Agreement executed and  delivered by Agent and each of the other parties listed on the signature pages thereto, in  substantially the form of Annex 1.  (xxxiii) "Lender" and "Lenders" have the respective meanings specified  therefor in the recitals to this Agreement.  (xxxiv) "Negotiable Collateral" means letters of credit, letter-of-credit rights,  instruments, promissory notes, drafts and documents (as each such term is defined in the Code).  (xxxv) "Parent" has the meaning specified therefor in the recitals to this  Agreement.  (xxxvi) "Patents" means patents and patent applications, including (A) the  patents and patent applications listed on Schedule 4, (B) all continuations, divisionals,  continuations-in-part, re-examinations, reissues, and renewals thereof and improvements thereon,  (C) all income, royalties, damages and payments now and hereafter due or payable under and with  respect thereto, including payments under all licenses entered into in connection therewith and  damages and payments for past, present, or future infringements thereof, (D) the right to sue for  past, present, and future infringements thereof, and (E) all of each Grantor's rights corresponding  thereto throughout the world.  (xxxvii) "Patent Security Agreement" means each Patent Security Agreement  executed and delivered by Grantors, or any of them, and Agent, in substantially the form of  Exhibit B.  (xxxviii) "Pledged Companies" means each Person listed on Schedule 5 as a  "Pledged Company", together with each other Person, all or a portion of whose Equity Interests  are acquired or otherwise owned by a Grantor after the Closing Date and is required to be pledged  pursuant to Section 5.11 of the Credit Agreement.  (xxxix) "Pledged Interests" means all of each Grantor's right, title and interest  in and to all of the Equity Interests now owned or hereafter acquired by such Grantor, regardless  of class or designation, including in each of the Pledged Companies, and all substitutions therefor  and replacements thereof, all proceeds thereof and all rights relating thereto, also including any  certificates representing the Equity Interests, the right to receive any certificates representing any  of the Equity Interests, all warrants, options, share appreciation rights and other rights, contractual  or otherwise, in respect thereof and the right to receive all dividends, distributions of income,  profits, surplus, or other compensation by way of income or liquidating distributions, in cash or in  kind, and all cash, instruments, and other property from time to time received, receivable, or  otherwise distributed in respect of or in addition to, in substitution of, on account of, or in exchange  for any or all of the foregoing.  (xl) "Pledged Interests Addendum" means a Pledged Interests Addendum  substantially in the form of Exhibit C.  (xli) "Pledged Notes" has the meaning specified therefor in Section 6(i)  hereof.  





 






  -7-  122895846v5  (xlii) "Pledged Operating Agreements" means all of each Grantor's rights,  powers, and remedies under the limited liability company operating agreements of each of the  Pledged Companies that are limited liability companies.  (xliii) "Pledged Partnership Agreements" means all of each Grantor's rights,  powers, and remedies under the partnership agreements of each of the Pledged Companies that are  partnerships.  (xliv) "Proceeds" has the meaning specified therefor in Section 3.  (xlv) "PTO" means the United States Patent and Trademark Office.  (xlvi) "Qualified ECP Grantor" means, in respect of any Swap Obligation,  each Grantor that has total assets exceeding $10,000,000 at the time the relevant guaranty,  keepwell, or grant of the relevant security interest becomes effective with respect to such Swap  Obligation or such other person as constitutes an "eligible contract participant" under the  Commodity Exchange Act or any regulations promulgated thereunder and can cause another  person to qualify as an "eligible contract participant" at such time by entering into a keepwell under  Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.  (xlvii) "Real Property" means any estates or interests in real property now  owned or hereafter acquired by any Grantor and the improvements thereto.  (xlviii) "Record" means information that is inscribed on a tangible medium or  which is stored in an electronic or other medium and is retrievable in perceivable form.  (xlix) "Rescission" has the meaning specified therefor in Section 7(k)  hereof.  (l) "Secured Obligations" means each and all of the following:  (A) all of  the present and future obligations of each of the Grantors arising from, or owing under or pursuant  to, this Agreement (including the Guaranty), the Credit Agreement, or any of the other Loan  Documents and (B)  all other Obligations of each Borrower and all other Guarantied Obligations  of each Guarantor (including, in the case of each of clauses (A) and (B), Lender Group Expenses  and any interest, fees, or expenses that accrue after the filing of an Insolvency Proceeding,  regardless of whether allowed or allowable in whole or in part as a claim in any Insolvency  Proceeding); provided that, anything to the contrary contained in the foregoing notwithstanding,  the Secured Obligations shall exclude any Excluded Swap Obligation.  (li) "Security Interest" has the meaning specified therefor in Section 3.  (lii) "Supporting Obligations" means supporting obligations (as such term  is defined in the Code), and includes letters of credit and guaranties issued in support of Accounts,  Chattel Paper, documents, General Intangibles, instruments or Investment Property.  (liii) "Swap Obligation" means, with respect to any Grantor, any obligation  to pay or perform under any agreement, contract or transaction that constitutes a "swap" within the  meaning of section 1a(47) of the Commodity Exchange Act.  





 






  -8-  122895846v5  (liv) "Titled Collateral" means all Collateral for which the title to such  Collateral is governed by a Certificate of Title or certificate of ownership, including, without  limitation, all motor vehicles (including, without limitation, all trucks, trailers, tractors, service  vehicles, automobiles and other mobile equipment) for which the title to such motor vehicles is  governed by a Certificate of Title or certificate of ownership.  (lv) "Trademarks" means any and all trademarks, trade names, registered  trademarks, trademark applications, service marks, registered service marks and service mark  applications, including (A) the trade names, registered trademarks, trademark applications,  registered service marks and service mark applications listed on Schedule 6, (B) all renewals  thereof, (C) all income, royalties, damages and payments now and hereafter due or payable under  and with respect thereto, including payments under all licenses entered into in connection  therewith and damages and payments for past, present or future infringements or dilutions thereof,  (D) the right to sue for past, present and future infringements and dilutions thereof, (E) the  goodwill of each Grantor's business symbolized by the foregoing or connected therewith, and  (F) all of each Grantor's rights corresponding thereto throughout the world.  (lvi) "Trademark Security Agreement" means each Trademark Security  Agreement executed and delivered by Grantors, or any of them, and Agent, in substantially the  form of Exhibit D.  (lvii) "URL" means "uniform resource locator," an internet web address.  (lviii) "VIN" has the meaning specified therefor in Section 5(h) hereof.  (b) This Agreement shall be subject to the rules of construction set forth in  Section 1.4 of the Credit Agreement, and such rules of construction are incorporated herein by this  reference, mutatis mutandis.  (c) All of the schedules and exhibits attached to this Agreement shall be  deemed incorporated herein by reference.  2. Guaranty.  (a) In recognition of the direct and indirect benefits to be received by  Guarantors from the proceeds of the Term Loan and by virtue of the financial accommodations to  be made to Borrowers pursuant to the Loan Documents, each of the Guarantors, jointly and  severally, hereby unconditionally and irrevocably guarantees as a primary obligor and not merely  as a surety the full and prompt payment when due, whether upon maturity, acceleration, or  otherwise, of all of the Guarantied Obligations.  If any or all of the Obligations constituting  Guarantied Obligations becomes due and payable, each of the Guarantors, unconditionally and  irrevocably, and without the need for demand, protest, or any other notice or formality, promises  to pay such indebtedness to Agent, for the benefit of the Lender Group, together with any and all  reasonable and documented expenses (including Lender Group Expenses) that may be incurred by  Agent or any other member of the Lender Group in demanding, enforcing, or collecting any of the  Guarantied Obligations (including the enforcement of any collateral for such Guarantied  Obligations or any collateral for the obligations of the Guarantors under this Guaranty).  If claim  is ever made upon Agent or any other member of the Lender Group for repayment or recovery of  





 






  -9-  122895846v5  any amount or amounts received in payment of or on account of any or all of the Guarantied  Obligations and any of Agent or any other member of the Lender Group repays all or part of said  amount by reason of (i) any judgment, decree, or order of any court or administrative body having  jurisdiction over such payee or any of its property, or (ii) any settlement or compromise of any  such claim effected by such payee with any such claimant (including any Borrower or any  Guarantor), then and in each such event, each of the Guarantors agrees that any such judgment,  decree, order, settlement, or compromise shall be binding upon the Guarantors, notwithstanding  any revocation (or purported revocation) of this Guaranty or other instrument evidencing any  liability of any Grantor, and the Guarantors shall be and remain liable to the aforesaid payees  hereunder for the amount so repaid or recovered to the same extent as if such amount had never  originally been received by any such payee.  (b) Additionally, each of the Guarantors unconditionally and irrevocably  guarantees the payment of any and all of the Guarantied Obligations to Agent, for the benefit of  the Lender Group, whether or not due or payable by any Loan Party upon the occurrence of any  of the events specified in Section 8.4 or 8.5 of the Credit Agreement, and irrevocably and  unconditionally promises to pay such indebtedness to Agent, for the benefit of the Lender Group,  without the requirement of demand, protest, or any other notice or other formality, in lawful money  of the United States.  (c) The liability of each of the Guarantors hereunder is primary, absolute, and  unconditional, and is independent of any security for or other guaranty of the Guarantied  Obligations, whether executed by any other Guarantor or by any other Person, and the liability of  each of the Guarantors hereunder shall not be affected or impaired by (i) any payment on, or in  reduction of, any such other guaranty or undertaking (other than payment in full of the Guarantied  Obligations), (ii) any dissolution, termination, or increase, decrease, or change in personnel by any  Grantor, (iii) any payment made to Agent or any other member of the Lender Group on account of  the Obligations which Agent or such other member of the Lender Group repays to any Grantor  pursuant to court order in any bankruptcy, reorganization, arrangement, moratorium or other  debtor relief proceeding (or any settlement or compromise of any claim made in such a proceeding  relating to such payment), and each of the Guarantors waives any right to the deferral or  modification of its obligations hereunder by reason of any such proceeding, (iv) any action or  inaction by Agent or any other member of the Lender Group or (v) any invalidity, irregularity,  avoidability, or unenforceability of all or any part of the Obligations or of any security therefor.  (d) This Guaranty includes all present and future Guarantied Obligations  including any under transactions continuing, compromising, extending, increasing, modifying,  releasing, or renewing the Guarantied Obligations, changing the interest rate, payment terms, or  other terms and conditions thereof, or creating new or additional Guarantied Obligations after prior  Guarantied Obligations have been satisfied in whole or in part.  To the maximum extent permitted  by law, each Guarantor hereby waives any right to revoke this Guaranty as to future Guarantied  Obligations.  If such a revocation is effective notwithstanding the foregoing waiver, each  Guarantor acknowledges and agrees that (i) no such revocation shall be effective until written  notice thereof has been received by Agent, (ii) no such revocation shall apply to any Guarantied  Obligations in existence on the date of receipt by Agent of such written notice (including any  subsequent continuation, extension, or renewal thereof, or change in the interest rate, payment  terms, or other terms and conditions thereof), (iii) no such revocation shall apply to any Guarantied  





 






  -10-  122895846v5  Obligations made or created after such date to the extent made or created pursuant to a legally  binding commitment of any member of the Lender Group in existence on the date of such  revocation, (iv) no payment by any Guarantor, any Borrower, or from any other source, prior to  the date of Agent's receipt of written notice of such revocation shall reduce the maximum  obligation of such Guarantor hereunder, and (v) any payment by any Borrower or from any source  other than such Guarantor subsequent to the date of such revocation shall first be applied to that  portion of the Guarantied Obligations as to which the revocation is effective and which are not,  therefore, guaranteed hereunder, and to the extent so applied shall not reduce the maximum  obligation of such Guarantor hereunder.  This Guaranty shall be binding upon each Guarantor, its  successors and assigns and inure to the benefit of and be enforceable by Agent (for the benefit of  the Lender Group) and its successors, transferees, or assigns.  (e) The guaranty by each of the Guarantors hereunder is a guaranty of payment  when due and not of collection, and each Guarantor waives any right to require that any resort be  made by Agent or any other member of the Lender Group to any Collateral.  The obligations of  each of the Guarantors hereunder are independent of the obligations of any other Guarantor or  Grantor or any other Person and a separate action or actions may be brought and prosecuted against  one or more of the Guarantors whether or not action is brought against any other Guarantor or  Grantor or any other Person and whether or not any other Guarantor or Grantor or any other Person  be joined in any such action or actions.  Each of the Guarantors waives, to the fullest extent  permitted by law, the benefit of any statute of limitations affecting its liability hereunder or the  enforcement hereof.  Any payment by any Grantor or other circumstance which operates to toll  any statute of limitations as to any Grantor shall operate to toll the statute of limitations as to each  of the Guarantors.  (f) Each of the Guarantors authorizes Agent and the other members of the  Lender Group, without notice or demand (other than any notice expressly required to be provided  hereunder or under any other Loan Document), and without affecting or impairing its liability  hereunder, from time to time to:  (i) change the manner, place, or terms of payment of, or change or extend  the time of payment of, renew, increase, accelerate, or alter:  (A) any of the Obligations (including  any increase or decrease in the principal amount thereof or the rate of interest or fees thereon), or  (B) any security therefor or any liability incurred directly or indirectly in respect thereof, and this  Guaranty shall apply to the Obligations as so changed, extended, renewed, or altered;  (ii) take and hold security for the payment of the Obligations and sell,  exchange, release, impair, surrender, realize upon, collect, settle, or otherwise deal with in any  manner and in any order any property at any time pledged or mortgaged to secure the Obligations  or any of the Guarantied Obligations (including any of the obligations of all or any of the  Guarantors under this Guaranty) incurred directly or indirectly in respect thereof or hereof, or any  offset on account thereof;  (iii) exercise or refrain from exercising any rights against any Grantor;  (iv) release or substitute any one or more endorsers, guarantors, any  Grantor, or other obligors;  





 






  -11-  122895846v5  (v) settle or compromise any of the Obligations, any security therefor, or  any liability (including any of those of any of the Guarantors under this Guaranty) incurred directly  or indirectly in respect thereof or hereof, and may subordinate the payment of all or any part thereof  to the payment of any liability (whether due or not) of any Grantor to its creditors;  (vi) apply any sums by whomever paid or however realized to any liability  or liabilities of any Grantor to Agent or any other member of the Lender Group regardless of what  liability or liabilities of such Grantor remain unpaid;  (vii) consent to or waive any breach of, or any act, omission, or default  under, this Agreement, any other Loan Document or any of the instruments or agreements referred  to herein or therein, or otherwise amend, modify, or supplement this Agreement, any other Loan  Document, or any of such other instruments or agreements; or  (viii) take any other action that could, under otherwise applicable principles  of law, give rise to a legal or equitable discharge of one or more of the Guarantors from all or part  of its liabilities under this Guaranty (other than a defense of payment in full of the Guarantied  Obligations).  (g) It is not necessary for Agent or any other member of the Lender Group to  inquire into the capacity or powers of any of the Guarantors or the officers, directors, partners or  agents acting or purporting to act on their behalf, and any Obligations made or created in reliance  upon the professed exercise of such powers shall be guaranteed hereunder.  (h) Each Guarantor jointly and severally guarantees that the Guarantied  Obligations will be paid strictly in accordance with the terms of the Loan Documents, regardless  of any law, regulation, or order now or hereafter in effect in any jurisdiction affecting any of such  terms or the rights of any member of the Lender Group with respect thereto.  The obligations of  each Guarantor under this Guaranty are independent of the Guarantied Obligations, and a separate  action or actions may be brought and prosecuted against each Guarantor to enforce such  obligations, irrespective of whether any action is brought against any other Guarantor or whether  any other Guarantor is joined in any such action or actions.  The liability of each Guarantor under  this Guaranty shall be irrevocable, absolute and unconditional irrespective of, and each Guarantor  hereby irrevocably waives any defense it may now or hereafter have (other than a defense of  payment in full of the Guarantied Obligations) in any way relating to, any or all of the following:  (i) any lack of validity or enforceability of any Loan Document or any  agreement or instrument relating thereto;  (ii) any change in the time, manner, or place of payment of, or in any other  term of, all or any of the Guarantied Obligations, or any other amendment or waiver of or any  consent to departure from any Loan Document, including any increase in the Guarantied  Obligations resulting from the extension of additional credit;  (iii) any taking, exchange, release, or non-perfection of any Lien in and to  any Collateral, or any taking, release, amendment, waiver, supplement, restatements, extension,  novation, renewal, replacements, or continuation of, or consent to departure from any other  guaranty, for all or any of the Guarantied Obligations;  





 






  -12-  122895846v5  (iv) the existence of any claim, set-off, defense, or other right that any  Guarantor may have at any time against any Person, including Agent or any other member of the  Lender Group;  (v) any defense, set-off, counterclaim, or claim, of any kind or nature,  arising directly or indirectly from the present or future lack of perfection, sufficiency, validity, or  enforceability of the Guarantied Obligations or any security therefor;  (vi) any right or defense arising by reason of any claim or defense based  upon an election of remedies by any member of the Lender Group including any defense based  upon an impairment or elimination of such Guarantor's rights of subrogation, reimbursement,  contribution, or indemnity of such Guarantor against any Grantor or any other guarantors or  sureties;  (vii) any change, restructuring, or termination of the corporate, limited  liability company, or partnership structure or existence of any Grantor; or  (viii) any other circumstance (including, without limitation, any statute of  limitations) or any existence of or reliance on any representation by the Agent or any other member  of the Lender Group that might otherwise constitute a defense available to, or a discharge of, any  Grantor or any other guarantor or surety, except a defense that the Guarantied Obligations have  been paid in full.  (i) Waivers.  (i) Each of the Guarantors waives any right (except as shall be required  by applicable statute and cannot be waived) to require Agent ro any other member of the Lender  Group to (i) proceed against any other Grantor or any other Person, (ii) proceed against or exhaust  any security held from any other Grantor or any other Person, or (iii) protect, secure, perfect, or  insure any security interest or Lien on any property subject thereto or exhaust any right to take any  action against any other Grantor, any other Person, or any collateral, or (iv) pursue any other  remedy in any member of the Lender Group's power whatsoever. Each of the Guarantors waives  promptness and diligence and notice of acceptance and any other notice with respect to any of the  Guarantied Obligations. Each of the Guarantors waives any defense based on or arising out of any  defense of any Grantor or any other Person, other than payment of the Guarantied Obligations to  the extent of such payment, based on or arising out of the disability of any Grantor or any other  Person, or the validity, legality, or unenforceability of the Obligations or any part thereof from any  cause, or the cessation from any cause of the liability of any Grantor other than payment of the  Obligations to the extent of such payment.  Agent may, at the election of the Required Lenders  and in accordance with the terms of the relevant Loan Documents, foreclose upon any Collateral  held by Agent by one or more judicial or non-judicial sales or other dispositions, whether or not  every aspect of any such sale is commercially reasonable or otherwise fails to comply with  applicable law or may exercise any other right or remedy Agent or any other member of the Lender  Group may have against any Grantor or any other Person, or any security, in each case, without  affecting or impairing in any way the liability of any of the Guarantors hereunder except to the  extent the Guarantied Obligations have been paid.  





 






  -13-  122895846v5  (ii) Each of the Guarantors waives all presentments, demands for  performance, protests and notices, including notices of nonperformance, notices of protest, notices  of dishonor, notices of acceptance of this Guaranty, and notices of the existence, creation, or  incurring of new or additional Obligations or other financial accommodations, in each case, except  with respect to any notices expressly required or provided pursuant to this Agreement or any other  Loan Document.  Each of the Guarantors waives notice of any Default or Event of Default under  any of the Loan Documents.  Each of the Guarantors assumes all responsibility for being and  keeping itself informed of each Grantor's financial condition and assets and of all other  circumstances bearing upon the risk of nonpayment of the Obligations and the nature, scope, and  extent of the risks which each of the Guarantors assumes and incurs hereunder, and agrees that  neither Agent nor any of the other members of the Lender Group shall have any duty to advise any  of the Guarantors of information known to them regarding such circumstances or risks.  (iii) To the fullest extent permitted by applicable law, each Guarantor  hereby waives:  (A) any right to assert against any member of the Lender Group, any defense (legal  or equitable) (other than the defense that all of the Guarantied Obligations have been paid in full),  set-off, counterclaim, or claim which each Guarantor may now or at any time hereafter have  against any Borrower or any other party liable to any member of the Lender Group, (B) any  defense, set-off, counterclaim, or claim, of any kind or nature, arising directly or indirectly from  the present or future lack of perfection, sufficiency, validity, or enforceability of the Guarantied  Obligations or any security therefor, (C) any right or defense arising by reason of any claim or  defense based upon an election of remedies by any member of the Lender Group including any  defense based upon an impairment or elimination of such Guarantor's rights of subrogation,  reimbursement, contribution, or indemnity of such Guarantor against any Borrower or other  guarantors or sureties, and (D) the benefit of any statute of limitations affecting such Guarantor's  liability hereunder or the enforcement thereof, and any act which shall defer or delay the operation  of any statute of limitations applicable to the Guarantied Obligations shall similarly operate to  defer or delay the operation of such statute of limitations applicable to such Guarantor's liability  hereunder.  (iv) No Guarantor will exercise any rights that it may now or hereafter  acquire against any Grantor or any other guarantor that arise from the existence, payment,  performance or enforcement of such Guarantor's obligations under this Guaranty, including any  right of subrogation, reimbursement, exoneration, contribution or indemnification and any right to  participate in any claim or remedy of Agent or any other member of the Lender Group, against  any Grantor or any other guarantor or any Collateral, whether or not such claim, remedy or right  arises in equity or under contract, statute or common law, including the right to take or receive  from any Grantor or any other guarantor, directly or indirectly, in cash or other property or by set- off or in any other manner, payment or security solely on account of such claim, remedy or right,  unless and until all of the Guarantied Obligations and all other amounts payable under this  Guaranty shall have been paid in full in cash and all of the Commitments have been terminated.   If any amount shall be paid to any Guarantor in violation of the immediately preceding sentence,  such amount shall be held in trust for the benefit of Agent, for the benefit of the Lender Group,  and shall forthwith be paid to Agent to be credited and applied to the Guarantied Obligations and  all other amounts payable under this Guaranty, whether matured or unmatured, in accordance with  the terms of the Credit Agreement, or to be held as Collateral for any Guarantied Obligations or  other amounts payable under this Guaranty thereafter arising.  Notwithstanding anything to the  





 






  -14-  122895846v5  contrary contained in this Guaranty, no Guarantor may exercise any rights of subrogation,  contribution, indemnity, reimbursement or other similar rights against, and may not proceed or  seek recourse against or with respect to any property or asset of, any other Grantor (the "Foreclosed  Grantor"), including after payment in full of the Obligations, if all or any portion of the Obligations  have been satisfied in connection with an exercise of remedies in respect of the Equity Interests of  such Foreclosed Grantor whether pursuant to this Agreement or otherwise.  (v) Each of the Guarantors hereby acknowledges and affirms that it  understands that to the extent the Guarantied Obligations are secured by Real Property located in  California, Guarantors shall be liable for the full amount of the liability hereunder notwithstanding  the foreclosure on such Real Property by trustee sale or any other reason impairing such  Guarantor's right to proceed against any Loan Party.  In accordance with Section 2856 of the  California Civil Code or any similar laws of any other applicable jurisdiction, each of the  Guarantors hereby waives until such time as the Guarantied Obligations have been paid in full:  (1) all rights of subrogation, reimbursement, indemnification,  and contribution and any other rights and defenses that are or may become available to the  Guarantors by reason of Sections 2787 to 2855, inclusive, 2899, and 3433 of the California Civil  Code or any similar laws of any other applicable jurisdiction;  (2) all rights and defenses that the Guarantors may have because  the Guarantied Obligations are secured by Real Property located in California, meaning, among  other things, that:  (A) Agent and the other members of the Lender Group may collect from the  Guarantors without first foreclosing on any real or personal property collateral pledged by any  Borrower or any other Grantor, and (B) if Agent, on behalf of the Lender Group, forecloses on any  Real Property collateral pledged by any Borrower or any other Grantor, (1) the amount of the  Guarantied Obligations may be reduced only by the price for which that collateral is sold at the  foreclosure sale, even if the collateral is worth more than the sale price, and (2) the Lender Group  may collect from the Guarantors even if, by foreclosing on the Real Property collateral, Agent or  the other members of the Lender Group have destroyed or impaired any right the Guarantors may  have to collect from any other Grantor, it being understood that this is an unconditional and  irrevocable waiver of any rights and defenses the Guarantors may have because the Guarantied  Obligations are secured by Real Property (including, without limitation, any rights or defenses  based upon Sections 580a, 580d, or 726 of the California Code of Civil Procedure or any similar  laws of any other applicable jurisdiction); and  (3) all rights and defenses arising out of an election of remedies  by Agent and the other members of the Lender Group, even though that election of remedies, such  as a non-judicial foreclosure with respect to security for the Guarantied Obligations, has destroyed  Guarantors' rights of subrogation and reimbursement against any Grantor by the operation of  Section 580d of the California Code of Civil Procedure or any similar laws of any other applicable  jurisdiction or otherwise.  (vi) Each of the Guarantors represents, warrants, and agrees that each of  the waivers set forth above is made with full knowledge of its significance and consequences and  that if any of such waivers are determined to be contrary to any applicable law or public policy,  such waivers shall be effective to the maximum extent permitted by law.  





 






  -15-  122895846v5  (vii) The provisions in this Section 2 which refer to certain sections of the  California Civil Code or the California Code of Civil Procedure are included in this Guaranty  solely out of an abundance of caution and shall not be construed to mean that any of the above- referenced provisions of California law are in any way applicable to this Guaranty.  3. Grant of Security.  Each Grantor hereby unconditionally grants, collaterally  assigns, and pledges to Agent, for the benefit of each member of the Lender Group, to secure the  Secured Obligations (whether now existing or hereafter arising), a continuing security interest  (hereinafter referred to as the "Security Interest") in all personal property and Fixtures of such  Grantor, wherever located and whether now or hereafter existing and whether now owned or  hereafter acquired, of every kind and description, tangible or intangible, including, without  limitation, the following (the "Collateral"):  (a) all of such Grantor's Accounts;  (b) all of such Grantor's Books;  (c) all of such Grantor's Chattel Paper;  (d) all of such Grantor's Commercial Tort Claims;  (e) all of such Grantor's Deposit Accounts;  (f) all of such Grantor's Equipment;  (g) all of such Grantor's Farm Products;  (h) all of such Grantor's Fixtures;  (i) all of such Grantor's General Intangibles;  (j) all of such Grantor's Inventory;  (k) all of such Grantor's Investment Property;  (l) all of such Grantor's Titled Collateral;  (m) all of such Grantor's Intellectual Property and Intellectual Property  Licenses;  (n) all of such Grantor's Negotiable Collateral (including all of such Grantor's  Pledged Notes);  (o) all of such Grantor's Pledged Interests (including all of such Grantor's  Pledged Operating Agreements and Pledged Partnership Agreements);  (p) all of such Grantor's Securities Accounts;  (q) all of such Grantor's Supporting Obligations;  





 






  -16-  122895846v5  (r) all of such Grantor's money, Cash Equivalents, or other assets of such  Grantor that now or hereafter come into the possession, custody, or control of Agent (or its agent  or designee) or any other member of the Lender Group;   (s) all other tangible and intangible personal property and Fixtures of such  Grantor (whether or not subject to the Code), including, without limitation, all bank and other  accounts and all cash and all investments therein, all proceeds, products, offspring, accessions,  rents, profits, income, benefits, substitutions and replacements of and to any of the property of  such Grantor described in the preceding clauses of this Section 3 (including, without limitation,  any proceeds of insurance thereon and all causes of action, claims and warranties now or hereafter  held by such Grantor in respect of any of the items listed above), and all books, correspondence,  files and other Records, including, without limitation, all tapes, disks, cards, software, data and  computer programs in the possession or under the control of such Grantor or any other Person  from time to time acting for such Grantor that at any time evidence or contain information relating  to any of the property described in the preceding clauses of this Section 3 or are otherwise  necessary or helpful in the collection or realization thereof; and  (t) all of the Proceeds and products, whether tangible or intangible, of any of  the foregoing, including proceeds of insurance or Commercial Tort Claims covering or relating to  any or all of the foregoing, and any and all Accounts, Books, Chattel Paper, Deposit Accounts,  Equipment, Farm Products, Fixtures, General Intangibles, Inventory, Investment Property,  Intellectual Property, Negotiable Collateral, Pledged Interests, Securities Accounts, Supporting  Obligations, money, or other tangible or intangible property resulting from the sale, lease, license,  exchange, collection, or other disposition of any of the foregoing, the proceeds of any award in  condemnation with respect to any of the foregoing, any rebates or refunds, whether for taxes or  otherwise, and all proceeds of any such proceeds, or any portion thereof or interest therein, and  the proceeds thereof, and all proceeds of any loss of, damage to, or destruction of the above,  whether insured or not insured, and, to the extent not otherwise included, any indemnity, warranty,  or guaranty payable by reason of loss or damage to, or otherwise with respect to any of the  foregoing (the "Proceeds").  Without limiting the generality of the foregoing, the term "Proceeds"  includes whatever is receivable or received when Investment Property or proceeds are sold,  exchanged, collected, or otherwise disposed of, whether such disposition is voluntary or  involuntary, and includes proceeds of any indemnity or guaranty payable to any Grantor or Agent  from time to time with respect to any of the Investment Property.  Notwithstanding anything contained in this Agreement to the contrary, the term  "Collateral" shall not include, and the security interest shall not attach to :  (i) any rights or interest  in any contract, lease, permit, license, or license agreement covering real or personal property of  any Grantor if under the terms of such contract, lease, permit, license, or license agreement, or  applicable law with respect thereto, the grant of a security interest or lien therein is prohibited or  restricted as a matter of law or under the terms of such contract, lease, permit, license, or license  agreement, or would violate or invalidate any such contract, lease, permit, license or license  agreement (or create a right of termination in favor of any other party thereto (other than a  Grantor)), and such prohibition or restriction has not been waived or the consent of the other party  to such contract, lease, permit, license, or license agreement has not been obtained (provided, that  (A) the foregoing exclusions of this clause (i) shall in no way be construed (1) to apply to the  extent that any described prohibition or restriction is ineffective under Section 9-406, 9-407, 9- 





 






  -17-  122895846v5  408, or 9-409 of the Code or other applicable law, or (2) to apply to the extent that any consent or  waiver has been obtained that would permit Agent's security interest or lien to attach  notwithstanding the prohibition or restriction on the pledge of such contract, lease, permit, license,  or license agreement and (B) the foregoing exclusions of this clause (i) shall in no way be  construed to limit, impair, or otherwise affect any of Agent's or any other member of the Lender  Group's continuing security interests in and liens upon any rights or interests of any Grantor in or  to (1) monies due or to become due under or in connection with any described contract, lease,  permit, license, license agreement, or Equity Interests (including any Accounts or Equity  Interests), or (2) any proceeds from the sale, license, lease, or other dispositions of any such  contract, lease, permit, license, license agreement, or Equity Interests); (ii) any United States  intent-to-use trademark applications to the extent that, and solely during the period in which, the  grant of a security interest therein would impair the validity or enforceability of such intent-to-use  trademark applications under applicable federal law; provided, that upon submission and  acceptance by the PTO of an amendment to allege use pursuant to 15 U.S.C. Section 1060(a) (or  any successor provision), such intent-to-use trademark application shall be considered Collateral;  (iii) any Excluded Account or (iv) Houston Assets.  4. Security for Secured Obligations.  The Security Interest created hereby secures the  payment and performance of the Secured Obligations, whether now existing or arising hereafter.   Without limiting the generality of the foregoing, this Agreement secures the payment of all  amounts which constitute part of the Secured Obligations and would be owed by Grantors, or any  of them, to Agent or the Lender Group, but for the fact that they are unenforceable or not allowable  (in whole or in part) as a claim in an Insolvency Proceeding involving any Grantor due to the  existence of such Insolvency Proceeding.  Further, the Security Interest created hereby encumbers  each Grantor's right, title, and interest in all Collateral, whether now owned by such Grantor or  hereafter acquired, obtained,  developed, or created by such Grantor and wherever located.  5. Grantors Remain Liable.  Anything herein to the contrary notwithstanding, (a) each  of the Grantors shall remain liable under the contracts and agreements to which it is a party  included in the Collateral, including the Pledged Operating Agreements and the Pledged  Partnership Agreements, to perform all of the duties and obligations thereunder to the same extent  as if this Agreement had not been executed, (b) the exercise by Agent or any other member of the  Lender Group of any of the rights hereunder shall not release any Grantor from any of its duties  or obligations under such contracts and agreements included in the Collateral, and (c) none of the  members of the Lender Group shall have any obligation or liability under such contracts and  agreements included in the Collateral by reason of this Agreement, nor shall any of the members  of the Lender Group be obligated to perform any of the obligations or duties of any Grantors  thereunder or to take any action to collect or enforce any claim for payment assigned hereunder.   Until an Event of Default shall occur and be continuing, except as otherwise provided in this  Agreement, the Credit Agreement, or any other Loan Document, Grantors shall have the right to  possession and enjoyment of the Collateral, subject to and upon the terms hereof and of the Credit  Agreement and the other Loan Documents.  Without limiting the generality of the foregoing, it is  the intention of the parties hereto that record and beneficial ownership of the Pledged Interests,  including all voting, consensual, dividend, and distribution rights, shall remain in the applicable  Grantor until (i) the occurrence and continuance of an Event of Default, and (ii) Agent has notified  the applicable Grantor of Agent's election to exercise such rights with respect to the Pledged  Interests pursuant to Section 16.  





 






  -18-  122895846v5  6. Representations and Warranties.  In order to induce Agent to enter into this  Agreement for the benefit of the Lender Group, each Grantor makes the following representations  and warranties to the Lender Group which shall be true, correct, and complete, in all material  respects (except that such materiality qualifier shall not be applicable to any representations and  warranties that already are qualified or modified by materiality in the text thereof), as of the  Closing Date, and shall be true, correct, and complete, in all material respects (except that such  materiality qualifier shall not be applicable to any representations and warranties that already are  qualified or modified by materiality in the text thereof), as of the date of the making of the Term  Loan (except to the extent that such representations and warranties relate solely to an earlier date,  in which case such representations and warranties shall be true and correct in all material respects  (except that such materiality qualifier shall not be applicable to any representations and warranties  that already are qualified or modified by materiality in the text thereof) as of such earlier date) and  such representations and warranties shall survive the execution and delivery of this Agreement:  (a) The name (within the meaning of Section 9-503 of the Code) and  jurisdiction of organization of each Grantor is set forth on Schedule 7 (as such Schedule may be  updated from time to time to reflect changes resulting from transactions permitted under the Loan  Documents).  (b) The chief executive office of each Grantor is located at the address indicated  on Schedule 7 (as such Schedule may be updated from time to time to reflect changes resulting  from transactions permitted under the Loan Documents).  (c) Each Grantor's tax identification numbers and organizational identification  numbers, if any, are identified on Schedule 7 (as such Schedule may be updated from time to time  to reflect changes resulting from transactions permitted under the Loan Documents).  (d) As of the Closing Date, no Grantor holds any commercial tort claims that  exceed $1,000,000 in amount, except as set forth on Schedule 1.  (e) Set forth on Schedule 9 (as such Schedule may be updated from time to time  subject to Section 7(k)(iii) with respect to Controlled Accounts and provided that Grantors comply  with Section 7(c) hereof) is a listing of all of Grantors' Deposit Accounts and Securities Accounts,  including, with respect to each bank or securities intermediary (i) the name and address of such  Person, and (ii) the account numbers of the Deposit Accounts or Securities Accounts maintained  with such Person.  (f) Schedule 8 sets forth all Real Property owned by any of the Grantors as of  the Closing Date.  (g) As of the Closing Date: (i) Schedule 2 provides a complete and correct list  of all registered Copyrights owned by any Grantor, all applications for registration of Copyrights  owned by any Grantor, and all other Copyrights owned by any Grantor and material to the conduct  of the business of any Grantor, (ii) Schedule 3 provides a complete and correct list of all  Intellectual Property Licenses entered into by any Grantor pursuant to which (A) any Grantor has  provided any license or other rights in Intellectual Property owned or controlled by such Grantor  to any other Person (other than non-exclusive software licenses granted in the ordinary course of  





 






  -19-  122895846v5  business), or (B) any Person has granted to any Grantor any license or other rights in Intellectual  Property owned or controlled by such Person that is material to the business of such Grantor,  including any Intellectual Property that is incorporated in any Inventory, software, or other product  marketed, sold, licensed, or distributed by such Grantor (other than off-the-shelf, shrink-wrapped  or "click to accept" software licenses or other licenses to generally commercially available  software), (iii) Schedule 4 provides a complete and correct list of all Patents owned by any Grantor  and all applications for Patents owned by any Grantor, and (iv) Schedule 6 provides a complete  and correct list of all registered Trademarks owned by any Grantor, and all applications for  registration of Trademarks owned by any Grantor.  (h) (i) (A) each Grantor owns exclusively or holds licenses in all Intellectual  Property that is necessary in or material to the conduct of the business of the Grantors (taken as a  whole), and (B) all employees and contractors of each Grantor who were involved in the creation  or development of any Intellectual Property for such Grantor that is necessary in or material to the  business of such Grantor have signed agreements containing assignment of Intellectual Property  rights to such Grantor and obligations of confidentiality;  (ii) to each Grantor's knowledge, no Person has infringed or  misappropriated or is currently infringing or misappropriating any Intellectual Property rights  owned by such Grantor that are necessary in or material to the conduct of the business of the  Grantors (taken as a whole);  (iii) (A) to each Grantor's knowledge after reasonable inquiry, (1) such  Grantor has never infringed or misappropriated and is not currently infringing or misappropriating  any Intellectual Property rights of any Person, and (2) no product manufactured, used, distributed,  licensed, or sold by or service provided by such Grantor has ever infringed or misappropriated or  is currently infringing or misappropriating any Intellectual Property rights of any Person, and  (B) there are no infringement or misappropriation claims or proceedings pending, or to any  Grantor's knowledge after reasonable inquiry, threatened in writing against any Grantor, and no  Grantor has received any other written notice or other written communication of any actual or  alleged infringement or misappropriation of any Intellectual Property rights of any Person;  (iv) to each Grantor's knowledge after reasonable inquiry, all registered  Copyrights, registered Trademarks, and issued Patents that are owned by such Grantor and  necessary in or material to the conduct of the business of the Grantors (taken as a whole) are valid,  subsisting and enforceable and in compliance with all legal requirements, filings, and payments  and other actions that are required to maintain such Intellectual Property in full force and effect;  and  (v) each Grantor has taken reasonable steps to maintain the confidentiality  of and otherwise protect and enforce its rights in all trade secrets owned by such Grantor that are  necessary in or material to the conduct of the  business of the Grantors (taken as a whole).  (i) This Agreement creates a valid security interest in the Collateral of each  Grantor, to the extent a security interest therein can be created under the Code, securing the  payment of the Secured Obligations.  Except to the extent a security interest in the Collateral  cannot be perfected by the filing of a financing statement under the Code, all filings and other  





 






  -20-  122895846v5  actions necessary or desirable, in Agent's Permitted Discretion, to perfect and protect such security  interest have been duly taken or will have been taken upon the filing of financing statements listing  each applicable Grantor, as a debtor, and Agent, as secured party, in the jurisdictions listed next to  such Grantor's name on Schedule 11.  Upon the making of such filings, Agent shall have a first  priority (subject only to Permitted Liens to the extent any such Liens would have priority over  Agent's Liens pursuant to any applicable law or an agreement expressly permitted under any of  the Loan Documents to have such senior priority) perfected security interest in the Collateral of  each Grantor to the extent such security interest can be perfected by the filing of a financing  statement under the Code.  Upon filing of any Copyright Security Agreement with the United  States Copyright Office, filing of any Patent Security Agreement and any Trademark Security  Agreement with the PTO, and the filing of appropriate financing statements in the jurisdictions  listed on Schedule 11, all action necessary or desirable, in Agent's Permitted Discretion, to protect  and perfect the Security Interest in and on each Grantor's United States issued and registered  Patents, Trademarks, or Copyrights has been taken and such perfected Security Interest is  enforceable as such as against any and all creditors of and purchasers from any Grantor.  All action  by any Grantor necessary to protect and perfect such security interest on each item of Collateral  has been duly taken, except to the extent expressly not required pursuant to this Agreement or any  other Loan Document.  (j) (i) Except for the Security Interest created hereby, each Grantor is and will  at all times be the sole holder of record and the legal and beneficial owner, free and clear of all  Liens other than Permitted Liens, of the Pledged Interests indicated on Schedule 5 as being owned  by such Grantor and, when acquired by such Grantor, any Pledged Interests acquired after the  Closing Date, (ii) all of the Pledged Interests are duly authorized, validly issued, fully paid and  non-assessable and the Pledged Interests constitute or will constitute the percentage of the issued  and outstanding Equity Interests of the Pledged Companies of such Grantor identified on Schedule  5 as supplemented or modified by any Pledged Interests Addendum or any Joinder to this  Agreement, (iii) such Grantor has the right and requisite authority to pledge, the Investment  Property pledged by such Grantor to Agent as provided herein, (iv) all actions necessary or  desirable, in Agent's Permitted Discretion, to perfect and establish the first priority (subject only  to Permitted Liens to the extent any such Liens would have priority over Agent's Liens pursuant  to any applicable law or an agreement expressly permitted under any of the Loan Documents to  have such senior priority) of, or otherwise protect, Agent's Liens in the Investment Property, and  the proceeds thereof, have been duly taken, upon (A) the execution and delivery of this Agreement,  (B) the taking of possession by Agent (or its agent or designee) of any certificates representing the  Pledged Interests, to the extent such Pledged Interests are represented by certificates, together with  undated powers (or other documents of transfer acceptable to Agent) endorsed in blank by the  applicable Grantor, (C) the filing of financing statements in the applicable jurisdiction set forth on  Schedule 11 for such Grantor with respect to the Pledged Interests of such Grantor that are not  represented by certificates, and (D) with respect to any Securities Accounts, the delivery of Control  Agreements with respect thereto, and (v) each Grantor has delivered to and deposited with Agent  all certificates representing the Pledged Interests owned by such Grantor to the extent such Pledged  Interests are represented by certificates, and undated powers (or other documents of transfer  acceptable to Agent) endorsed in blank with respect to such certificates. None of the Pledged  Interests owned or held by such Grantor has been issued or transferred in violation of any securities  registration, securities disclosure, or similar laws of any jurisdiction to which such issuance or  transfer may be subject.  





 






  -21-  122895846v5  (k) No consent, approval, authorization, or other order or other action by, and  no notice to or filing with, any Governmental Authority or any other Person is required (i) for the  grant of a Security Interest by such Grantor in and to the Collateral pursuant to this Agreement or  for the execution, delivery, or performance of this Agreement by such Grantor, or (ii) for the  exercise by Agent of the voting or other rights provided for in this Agreement with respect to the  Investment Property or the remedies in respect of the Collateral pursuant to this Agreement, except  (A) as may be required in connection with such disposition of Investment Property by laws  affecting the offering and sale of securities generally, (B) for consents, approvals, authorizations,  or other orders or actions that have already been obtained or given (as applicable) and that are still  in force, and (C) the filing of financing statements and other filings necessary to perfect the  Security Interests granted hereby.  No Intellectual Property License of any Grantor that is  necessary in or material to the conduct of such Grantor's business requires any consent of any other  Person that has not been obtained in order for such Grantor to grant the security interest granted  hereunder in such Grantor's right, title or interest in or to such Intellectual Property License.  (l) Schedule 12 sets forth all Titled Collateral owned by Grantors as of the  Closing Date, by model, model year, and vehicle identification number ("VIN").  (m) There is no default, breach, violation, or event of acceleration existing under  any promissory note (as defined in the Code) constituting Collateral and pledged hereunder (each  a "Pledged Note") and no event has occurred or circumstance exists which, with the passage of  time or the giving of notice, or both, would constitute a default, breach, violation, or event of  acceleration under any Pledged Note.  No Grantor that is an obligee under a Pledged Note has  waived any default, breach, violation, or event of acceleration under such Pledged Note.  (n) As to all limited liability company or partnership interests, issued under any  Pledged Operating Agreement or Pledged Partnership Agreement, each Grantor hereby represents  and warrants that the Pledged Interests issued pursuant to such agreement (i) are not dealt in or  traded on securities exchanges or in securities markets, (ii) do not constitute investment company  securities, and (iii) are not held by such Grantor in a Securities Account.  In addition, as of the  Closing Date, none of the Pledged Operating Agreements, the Pledged Partnership Agreements,  or any other agreements governing any of the Pledged Interests issued under any Pledged  Operating Agreement or Pledged Partnership Agreement, provides that such Pledged Interests are  securities governed by Article 8 of the Uniform Commercial Code as in effect in any relevant  jurisdiction. If after the Closing Date any Pledged Operating Agreement, Pledged Partnership  Agreement, or any other agreement governing any of the Pledged Interests issued under any  Pledged Operating Agreement or Pledged Partnership Agreement provides that such Pledged  Interests are securities governed by Article 8 of the Uniform Commercial Code as in effect in any  relevant jurisdiction, such agreement shall require that such Pledged Interests be certificated and  such Grantor shall comply with Section 7(h)(vi) with respect thereto.  7. Covenants.  Each Grantor, jointly and severally, covenants and agrees with Agent  that from and after the date of this Agreement and until the date of termination of this Agreement  in accordance with Section 23:  (a) Possession of Collateral.  In the event that any Collateral, including  Proceeds, is evidenced by or consists of Negotiable Collateral (other than (i) checks received in  





 






  -22-  122895846v5  the ordinary course of business and (ii) the Gem Note to the extent that the aggregate outstanding  principal amount of the Gem Note does not exceed $300,000), Investment Property, or Chattel  Paper having an aggregate value or face amount of $250,000 or more for all such Negotiable  Collateral, Investment Property, or Chattel Paper, the Grantors shall promptly (and in any event  within five Business Days (or such longer period as agreed to by Agent in writing in its sole  discretion) after acquisition thereof), notify Agent thereof, and if and to the extent that perfection  or priority of Agent's Security Interest is dependent on or enhanced by possession, the applicable  Grantor, promptly (and in any event within five Business Days (or such longer period as agreed to  by Agent in writing in its sole discretion)) after request by Agent, shall execute such other  documents and instruments as shall be requested by Agent or, if applicable, endorse (without  recourse, representation or warranty) and deliver physical possession of such Negotiable  Collateral, Investment Property, or Chattel Paper to Agent, together with such undated powers (or  other relevant document of transfer acceptable to Agent) endorsed in blank as shall be requested  by Agent, and shall do such other acts or things deemed necessary or desirable by Agent, in its  Permitted Discretion, to protect Agent's Security Interest therein.  (b) Chattel Paper.  (i) Promptly (and in any event within five Business Days (or such longer  period as agreed to by Agent in writing in its sole discretion)) after request by Agent, each Grantor  shall take all steps reasonably necessary to grant Agent control of all electronic Chattel Paper in  accordance with the Code and all "transferable records" as that term is defined in Section 16 of the  Uniform Electronic Transaction Act and Section 201 of the federal Electronic Signatures in Global  and National Commerce Act as in effect in any relevant jurisdiction, to the extent that the aggregate  value or face amount of such electronic Chattel Paper equals or exceeds $250,000; and  (ii) If any Grantor retains possession of any Chattel Paper or instruments  (which retention of possession shall be subject to the extent permitted hereby and by the Credit  Agreement), promptly upon the request of Agent, such Chattel Paper and instruments shall be  marked with the following legend:  "This writing and the obligations evidenced or secured hereby  are subject to the Security Interest of MGG Investment Group LP, as Agent for the benefit of the  Lender Group".  (c) Control Agreements.  (i) Subject to any applicable time periods provided under the Credit  Agreement (including Schedule 3.6 to the Credit Agreement), each Grantor shall obtain an  authenticated Control Agreement (which may include a Controlled Account Agreement), from  each bank maintaining a Deposit Account or Securities Account for such Grantor (other than with  respect to any Excluded Accounts);  (ii) Each Grantor shall obtain an authenticated Control Agreement, from  each issuer of uncertificated securities, securities intermediary, or commodities intermediary  issuing or holding any financial assets or commodities to or for any Grantor, or maintaining a  Securities Account for such Grantor (other than with respect to any Excluded Accounts); and  





 






  -23-  122895846v5  (iii) Each Grantor shall obtain an authenticated Control Agreement with  respect to all of such Grantor's investment property.  (d) Letter-of-Credit Rights.  If the Grantors (or any of them) are or become the  beneficiary of letters of credit having a face amount or value of $1,000,000 or more in the  aggregate, then the applicable Grantor or Grantors shall promptly (and in any event within five  Business Days (or such longer period as agreed to by Agent in writing in its sole discretion) after  becoming a beneficiary), notify Agent thereof and, promptly (and in any event within five Business  Days (or such longer period as agreed to by Agent in writing in its sole discretion)) after request  by Agent, enter into a tri-party agreement with Agent and the issuer or confirming bank with  respect to letter-of-credit rights assigning such letter-of-credit rights as part of the Collateral to  Agent and directing all payments thereunder to Agent's Account, all in form and substance  reasonably satisfactory to Agent.  (e) Commercial Tort Claims.  If the Grantors (or any of them) obtain  Commercial Tort Claims having a value, or involving an asserted claim, in the amount of  $1,000,000 or more in the aggregate for all Commercial Tort Claims, then the applicable Grantor  or Grantors shall promptly (and in any event within five Business Days (or such longer period as  agreed to by Agent in writing in its sole discretion) of obtaining such Commercial Tort Claim),  notify Agent upon incurring or otherwise obtaining such Commercial Tort Claims and, promptly  (and in any event within five Business Days (or such longer period as agreed to by Agent in writing  in its sole discretion)) after request by Agent, amend Schedule 1 to describe such Commercial Tort  Claims in a manner that reasonably identifies such Commercial Tort Claims and which is  otherwise reasonably satisfactory to Agent, and hereby authorizes the filing of additional financing  statements or amendments to existing financing statements describing such Commercial Tort  Claims, and agrees to do such other acts or things deemed necessary or desirable by Agent, in its  Permitted Discretion, to give Agent a first priority (subject only to Permitted Liens to the extent  any such Liens would have priority over Agent's Liens pursuant to any applicable law or an  agreement expressly permitted under any of the Loan Documents to have such senior priority),  perfected security interest in any such Commercial Tort Claim.  (f) Government Contracts.  Other than Accounts and Chattel Paper the  aggregate value of which does not at any one time exceed $250,000, if any Account or Chattel  Paper arises out of a contract or contracts with the United States of America or any department,  agency, or instrumentality thereof, Grantors shall promptly (and in any event within five Business  Days (or such longer period as agreed to by Agent in writing in its sole discretion) of the creation  thereof) notify Agent thereof and, promptly (and in any event within five Business Days (or such  longer period as agreed to by Agent in writing in its sole discretion)) after request by Agent,  execute any instruments or take any steps reasonably required by Agent in order that all moneys  due or to become due under such contract or contracts shall be assigned as part of the Collateral to  Agent, for the benefit of the Lender Group, and shall provide written notice thereof under the  Assignment of Claims Act or other applicable law.  (g) Intellectual Property.  (i) Upon the request of Agent, in order to facilitate filings with the PTO  and the United States Copyright Office, each Grantor shall execute and deliver to Agent one or  





 






  -24-  122895846v5  more Copyright Security Agreements, Trademark Security Agreements, or Patent Security  Agreements to further evidence Agent's Lien on such Grantor's United States issued and registered  Patents, Trademarks, or Copyrights, and the General Intangibles of such Grantor relating thereto  or represented thereby;  (ii) Each Grantor shall have the duty, with respect to Intellectual Property  owned by such Grantor that is necessary in or material to the conduct of Grantors' business (taken  as a whole), to protect and diligently enforce and defend at such Grantor's expense its Intellectual  Property, in each case, subject to and in accordance with good business judgment as reasonably  determined by such Grantor, including (A) to diligently enforce and defend, including promptly  suing for infringement, misappropriation, or dilution and to recover any and all damages for such  infringement, misappropriation, or dilution, and filing for opposition, interference, and  cancellation against conflicting Intellectual Property rights of any Person, (B) to prosecute  diligently any trademark application or service mark application that is part of the Trademarks  pending as of the date hereof or hereafter until the termination of this Agreement, (C) to prosecute  diligently any patent application that is part of the Patents pending as of the date hereof or hereafter  until the termination of this Agreement, (D) to take all reasonable and necessary action to preserve  and maintain all of such Grantor's Trademarks, Patents, Copyrights, Intellectual Property Licenses,  and its rights therein, including paying all maintenance fees and filing of applications for renewal,  affidavits of use, and affidavits of noncontestability, and (E) to require all employees, consultants,  and contractors of each Grantor who were involved in the creation or development of such  Intellectual Property to sign agreements containing assignment of Intellectual Property rights and  obligations of confidentiality.  Except with respect to Permitted Dispositions, each Grantor further  agrees not to abandon any Intellectual Property or Intellectual Property License that is necessary  in or material to the conduct of such Grantor's business.  Each Grantor hereby agrees, subject to  its reasonable business judgment, to take the steps described in this Section 7(g)(ii) with respect  to all new or acquired Intellectual Property to which it or any of its Subsidiaries is now or later  becomes entitled that is necessary in or material to the conduct of such Grantor's business;  (iii) Grantors acknowledge and agree that the Lender Group shall have no  duties with respect to any Intellectual Property or Intellectual Property Licenses of any Grantor.   Without limiting the generality of this Section 7(g)(iii), Grantors acknowledge and agree that no  member of the Lender Group shall be under any obligation to take any steps necessary to preserve  rights in the Collateral consisting of Intellectual Property or Intellectual Property Licenses against  any other Person, but any member of the Lender Group may do so at its option from and after the  occurrence and during the continuance of an Event of Default, and all expenses incurred in  connection therewith (including reasonable and documented fees and expenses of attorneys and  other professionals) shall be for the sole account of Borrowers and shall be chargeable to the Loan  Account;  (iv) On each date on which a Compliance Certificate is required to be  delivered pursuant to Section 5.1 of the Credit Agreement in respect of a fiscal quarter (or, if an  Event of Default has occurred and is continuing, more frequently if requested by Agent), each  Grantor shall provide Agent with a written report of all new Patents, Trademarks or Copyrights  that are registered or the subject of pending applications for registrations, and of all Intellectual  Property Licenses that are material to the conduct of such Grantor's business, in each case, which  were acquired, registered, or for which applications for registration were filed by any Grantor  





 






  -25-  122895846v5  during the prior period and any statement of use or amendment to allege use with respect to intent- to-use trademark applications.  In the case of such registrations or applications therefor, which  were acquired by any Grantor, each such Grantor shall file the necessary documents with the  appropriate Governmental Authority identifying the applicable Grantor as the owner (or as a co- owner thereof, if such is the case) of such Intellectual Property.  In each of the foregoing cases,  the applicable Grantor shall promptly cause to be prepared, executed, and delivered to Agent  supplemental schedules to the applicable Loan Documents to identify such Patent, Trademark and  Copyright registrations and applications therefor (with the exception of Trademark applications  filed on an intent-to-use basis for which no statement of use or amendment to allege use has been  filed) and Intellectual Property Licenses as being subject to the security interests created  thereunder;  (v) Anything to the contrary in this Agreement notwithstanding, in no  event shall any Grantor, either itself or through any agent, employee, licensee, or designee, file an  application for the registration of any Copyright with the United States Copyright Office or any  similar office or agency in another country without giving Agent written notice thereof at least five  (5) Business Days prior to such filing and complying with Section 7(g)(i) and, if available, each  such application for registration shall be filed on an "expedited basis".  Upon receipt from the  United States Copyright Office of notice of registration of any Copyright, each Grantor shall  promptly (but in no event later than five Business Days after receipt thereof (or such longer period  as agreed to by Agent in writing in its sole discretion) following such receipt) notify (but without  duplication of any notice required by Section 7(g)(iv)) Agent of such registration by delivering, or  causing to be delivered, to Agent, documentation sufficient for Agent to perfect Agent's Liens on  such Copyright.  If any Grantor acquires from any Person any Copyright registered with the United  States Copyright Office or an application to register any Copyright with the United States  Copyright Office, such Grantor shall promptly (but in no event later than five Business Days (or  such longer period as agreed to by Agent in writing in its sole discretion) following such  acquisition) notify Agent of such acquisition and deliver, or cause to be delivered, to Agent,  documentation sufficient for Agent to perfect Agent's Liens on such Copyright.  In the case of such  Copyright registrations or applications therefor which were acquired by any Grantor, each such  Grantor shall promptly (but in no event later than five Business Days (or such longer period as  agreed to by Agent in writing in its sole discretion) following such acquisition) file the necessary  documents with the appropriate Governmental Authority identifying the applicable Grantor as the  owner (or as a co-owner thereof, if such is the case) of such Copyrights;  (vi) Each Grantor shall take reasonable steps to maintain the  confidentiality of, and otherwise protect and enforce (subject to its reasonable business judgment)  its rights in, the Intellectual Property that is necessary in or material to the conduct of such  Grantor's business, including, as applicable (A) protecting the secrecy and confidentiality of its  confidential information and trade secrets by having and enforcing, subject to its reasonable  business judgment, a policy requiring all current employees, consultants, licensees, vendors and  contractors with access to such information to execute appropriate confidentiality agreements,  (B) taking actions reasonably necessary to ensure that no trade secret falls into the public domain,  and (C) protecting the secrecy and confidentiality of the source code of all software programs and  applications of which it is the owner or licensee by having and enforcing, subject to its reasonable  business judgment, a policy requiring any licensees (or sublicensees) of such source code to enter  into license agreements with commercially reasonable use and non-disclosure restrictions; and  





 






  -26-  122895846v5  (vii) No Grantor shall enter into any Intellectual Property License material  to the conduct of the business to receive any license or rights in any Intellectual Property of any  other Person unless such Grantor has used commercially reasonable efforts to permit the  assignment of or grant of a security interest in such Intellectual Property License (and all rights of  Grantor thereunder) to Agent (and any transferees of Agent).  (h) Investment Property.  (i) If any Grantor shall acquire, obtain, receive or become entitled to  receive any Pledged Interests after the Closing Date, it shall promptly (and in any event within five  Business Days (or such longer period as agreed to by Agent in writing in its sole discretion) of  acquiring or obtaining such Collateral) deliver to Agent a duly executed Pledged Interests  Addendum identifying such Pledged Interests;  (ii) Upon the occurrence and during the continuance of an Event of  Default, following the request of Agent, all sums of money and property paid or distributed in  respect of the Investment Property that are received by any Grantor shall be held by the Grantors  in trust for the benefit of Agent segregated from such Grantor's other property, and such Grantor  shall deliver it forthwith to Agent in the exact form received;  (iii) Each Grantor shall promptly deliver to Agent a copy of each material  notice or other material communication received by it in respect of any Pledged Interests;  (iv) No Grantor shall make or consent to any amendment or other  modification or waiver with respect to any Pledged Interests, Pledged Operating Agreement, or  Pledged Partnership Agreement, or enter into any agreement or permit to exist any restriction with  respect to any Pledged Interests if the same is prohibited pursuant to the Loan Documents;  (v) Each Grantor agrees that it will cooperate with Agent in (A) obtaining  all necessary approvals and making all necessary filings under federal, state, local, or foreign law  to effect the perfection of the Security Interest on the Investment Property or (B) effecting any sale  or transfer thereof; and  (vi) As to all limited liability company or partnership interests owned by  such Grantor and issued under any Pledged Operating Agreement or Pledged Partnership  Agreement, each Grantor hereby covenants that the Pledged Interests issued pursuant to such  agreement (A) are not and shall not be dealt in or traded on securities exchanges or in securities  markets, (B) do not and will not constitute investment company securities, and (C) are not and will  not be held by such Grantor in a securities account.  In addition, as of the Closing Date, none of  the Pledged Operating Agreements, the Pledged Partnership Agreements, or any other agreements  governing any of the Pledged Interests issued under any Pledged Operating Agreement or Pledged  Partnership Agreement, provides or shall provide that such Pledged Interests are securities  governed by Article 8 of the Uniform Commercial Code as in effect in any relevant jurisdiction.  If after the Closing Date any Pledged Operating Agreement, Pledged Partnership Agreement, or  any other agreement governing any of the Pledged Interests issued under any Pledged Operating  Agreement or Pledged Partnership Agreement provides that such Pledged Interests are securities  governed by Article 8 of the Uniform Commercial Code as in effect in any relevant jurisdiction,  





 






  -27-  122895846v5  such agreement shall require that such Pledged Interests be certificated and such Grantor shall  promptly deliver each such certificate to Agent; and  (vii) With regard to any Pledged Interests that are not certificated, any such  Grantor of such non-certificated Pledged Interests (i) agrees promptly to note on its books the  security interests granted to Agent and confirmed under this Agreement, (ii) agrees that after the  occurrence and during the continuation of an Event of Default, it will comply with instructions of  Agent or its nominee with respect to the applicable Pledged Interests without further consent by  the applicable Grantor, (iii) to the extent permitted by law, agrees that the "issuer's jurisdiction"  (as defined in Section 8-110 of the UCC) is the State of New York, (iv) agrees to notify Agent  upon obtaining knowledge of any interest in favor of any person in the applicable Pledged Interests  that is materially adverse to the interest of the Agent therein, other than any Permitted Liens and  (v) waives any right or requirement at any time hereafter to receive a copy of this Agreement in  connection with the registration of any Pledged Interests hereunder in the name of Agent or its  nominee or the exercise of voting rights by Agent or its nominee.  (i) Real Property; Fixtures.  Each Grantor covenants and agrees that upon the  acquisition of any fee interest in Real Property it will promptly (and in any event within five  Business Days (or such longer period as agreed to by Agent in writing in its sole discretion) of  acquisition) notify Agent of the acquisition of such Real Property and, to the extent required under  Section 5.12 of the Credit Agreement, will grant to Agent, for the benefit of the Lender Group, a  first priority (subject only to Permitted Liens to the extent any such Liens would have priority over  Agent's Liens pursuant to any applicable law or an agreement expressly permitted under any of  the Loan Documents to have such senior priority) Mortgage on each fee interest in Real Property  now or hereafter owned by such Grantor and, to the extent required under Section 5.12 of the  Credit Agreement, shall deliver such Additional Documents (including, without limitation, title  insurance policies, financing statements, fixture filings and environmental audits), in form and  substance satisfactory to Agent, in connection with the grant of such Mortgage as Agent shall  request in its Permitted Discretion, and such Grantor shall pay all recording costs, intangible taxes  and other fees and costs (including reasonable and documented attorneys' fees and expenses)  incurred in connection therewith, in each case, to the extent provided for pursuant to the Credit  Agreement and the other Loan Documents.  Each Grantor acknowledges and agrees that, to the  extent permitted by applicable law, all of the Collateral shall remain personal property regardless  of the manner of its attachment or affixation to real property.  (j) Transfers and Other Liens.  Grantors shall not (i) sell, assign (by operation  of law or otherwise) or otherwise dispose of, or grant any option with respect to, any of the  Collateral, except as expressly permitted by the Credit Agreement, or (ii) create or permit to exist  any Lien upon or with respect to any of the Collateral of any Grantor, except for Permitted Liens.   The inclusion of Proceeds in the Collateral shall not be deemed to constitute Agent's consent to  any sale or other disposition of any of the Collateral except as expressly permitted in this  Agreement or the other Loan Documents.  (k) Controlled Accounts; Controlled Investments.  (i) Subject to any applicable time periods provided under the Credit  Agreement (including Schedule 3.6 to the Credit Agreement), each Grantor shall (A) establish and  





 






  -28-  122895846v5  maintain cash management services of a type and on terms reasonably satisfactory to Agent at  Wells Fargo Bank, National Association or one or more of the other banks set forth on Schedule  10 (each a "Controlled Account Bank"), and shall take reasonable steps to ensure that all of its  Account Debtors forward payment of the amounts owed by them directly to a Collection Account  at such Controlled Account Bank that is not an Excluded Account (each, a "Controlled Account")  (by wire transfer to the applicable Controlled Account Bank or to a lockbox maintained by the  applicable Controlled Account Bank for deposit into such Collection Account), and (B) deposit or  cause to be deposited promptly, and in any event no later than the first Business Day after the date  of receipt thereof, all of their Collections (including those sent directly by their Account Debtors  to a Grantor) and proceeds of Collateral into a Controlled Account;  (ii) Subject to any applicable time periods provided under the Credit  Agreement (including Schedule 3.6 to the Credit Agreement), each Grantor shall establish and  maintain with respect to each Collateral Account, Controlled Account Agreements with Agent and  the applicable Controlled Account Bank, in form and substance reasonably acceptable to Agent.   Each such Controlled Account Agreement shall provide, among other things, that (A) the  Controlled Account Bank will comply with any instructions originated by Agent directing the  disposition of the funds in each applicable Controlled Account without further consent by the  applicable Grantor, (B) the Controlled Account Bank waives, subordinates, or agrees not to  exercise any rights of setoff or recoupment or any other claim against each applicable Controlled  Account other than for payment of its service fees and other charges directly related to the  administration of such Controlled Account and for returned checks or other items of payment, and  (C) upon the instruction of Agent (an "Activation Instruction"), the Controlled Account Bank will  forward by daily sweep all amounts in each applicable Controlled Account to the Agent's Account.   Agent agrees not to issue an Activation Instruction with respect to the Controlled Accounts unless  such Activation Instruction is issued during a Cash Dominion Period.  Agent agrees to use  commercially reasonable efforts to promptly rescind an Activation Instruction (the "Rescission")  after any Cash Dominion Period has ended;  (iii) So long as no Default or Event of Default has occurred and is  continuing or would result therefrom, Borrowers may amend Schedule 10 to add or replace a  Controlled Account Bank or Controlled Account and shall upon such addition or replacement  provide to Agent an amended Schedule 10; provided, that (A) such prospective Controlled  Account Bank shall be reasonably satisfactory to Agent, and (B) prior to the time of the opening  of such Controlled Account, the applicable Grantor and such prospective Controlled Account Bank  shall have executed and delivered to Agent a Controlled Account Agreement.  Each Grantor shall  close any of its Controlled Accounts (and establish replacement Controlled Account accounts in  accordance with the foregoing sentence) as promptly as practicable and in any event within 45  days after notice from Agent that the operating performance, funds transfer, or availability  procedures or performance of the Controlled Account Bank with respect to Controlled Account  Accounts or Agent's liability under any Controlled Account Agreement with such Controlled  Account Bank is no longer acceptable in Agent's reasonable judgment; and  (iv) Subject to any applicable time periods provided under the Credit  Agreement (including Schedule 3.6 to the Credit Agreement), other than with respect to Excluded  Accounts, no Grantor will, and no Grantor will permit its Subsidiaries to, make, acquire, or permit  to exist Permitted Investments consisting of cash, Cash Equivalents, or amounts credited to  





 






  -29-  122895846v5  Deposit Accounts or Securities Accounts unless Grantor or its Subsidiary, as applicable, and the  applicable bank or securities intermediary have entered into Control Agreements governing such  Permitted Investments in order to perfect (or further establish) Agent's Liens in such Permitted  Investments.  (l) Name, Etc.  No Grantor will change its name, chief executive office,  organizational identification number, jurisdiction of organization or organizational identity;  provided, that any Grantor may change its name or chief executive office upon at least ten days  prior written notice to Agent of such change.  (m) Account Verification. Each Grantor will, and will cause each of its  Subsidiaries to, permit Agent, after the occurrence and during the continuance of an Event of  Default, in Agent's name or in the name or a nominee of Agent, to verify the validity, amount or  any other matter relating to any Account, by mail, telephone, facsimile transmission or other  electronic means of transmission or otherwise.  Further, at the request of Agent, each Grantor will,  and will cause each of its Subsidiaries to, send requests for verification of Accounts or, after the  occurrence and during the continuance of an Event of Default, send notices of assignment of  Accounts to Account Debtors and other obligors.  (n) Titled Collateral.    (i) Each Grantor shall (A) cause all Collateral, now owned or hereafter  acquired by any Grantor, which under applicable law are required to be registered, to be properly  registered in the name of such Grantor, (B) cause all Titled Collateral, to be properly titled in the  name of such Grantor, and if requested by Agent, with Agent's Lien noted thereon and (C) if  requested by Agent, promptly deliver to Agent (or its custodian) originals of all such Certificates  of Title or certificates of ownership for such Titled Collateral, with Agent's Lien noted thereon.  (ii) Upon the acquisition after the date hereof by any Grantor of any Titled  Collateral (other than Equipment to be acquired that is subject to a purchase money security  interest that constitutes a Permitted Lien under the Credit Agreement), such Grantor shall promptly  (and in any event within 10 Business Days) notify Agent of such acquisition, set forth a description  of such Titled Collateral acquired and a good faith estimate of the current value of such Titled  Collateral, and if so requested by Agent, immediately deliver to Agent (or its custodian) originals  of the Certificates of Title or certificates of ownership for such Titled Collateral, together with the  manufacturer's statement of origin, and an application duly executed by the appropriate Grantor to  evidence Agent's Lien thereon.  (iii) Each Grantor hereby appoints Agent as its attorney-in-fact, effective  the date hereof and terminating upon the termination of this Agreement, for the purpose of (A)  executing on behalf of such Grantor title or ownership applications for filing with appropriate  Governmental Authority to enable Titled Collateral now owned or hereafter acquired by such  Grantor to be amended to reflect Agent listed as lienholder thereof, (B) filing such applications  with such Governmental Authority, and (C) executing such other documents and instruments on  behalf of, and taking such other action in the name of, such Grantor as Agent may deem necessary  or advisable, in its Permitted Discretion, to accomplish the purposes of this Section 7(n) (including,  without limitation, for the purpose of creating in favor of Agent a perfected Lien on such Titled  





 






  -30-  122895846v5  Collateral and exercising the rights and remedies of Agent hereunder).  This appointment as  attorney-in-fact is coupled with an interest and is irrevocable until the Obligations have been paid  in full in accordance with the provisions of the Credit Agreement and the Commitments have  expired or have been terminated.  (iv) So long as no Event of Default shall have occurred and be continuing,  upon the request of any Grantor, Agent shall execute and deliver to such Grantor such instruments  as such Grantor shall reasonably request to remove the notation of Agent as lienholder on any  Certificate of Title or certificate of ownership for any Titled Collateral; provided that any such  instruments shall be delivered, and the release shall be effective, only upon receipt by Agent of a  certificate from such Grantor, stating that the Titled Collateral, the Lien on which is to be released,  is to be sold in accordance with the terms of the Credit Agreement or has suffered a casualty loss  (with title thereto passing to the casualty insurance company therefor in settlement of the claim for  such loss), the amount that such Grantor will receive as sale proceeds or insurance proceeds and  whether or not such sale proceeds or insurance proceeds are required by the Credit Agreement to  be paid to Agent to be applied to the Secured Obligations and, to the extent required by the Credit  Agreement, any proceeds of such sale or casualty loss shall be paid to Agent hereunder to be  applied to the Secured Obligations in accordance with the terms of the Credit Agreement.  (o) Pledged Notes.  With respect to any of the Pledged Notes (other than the  Gem Note to the extent that the aggregate principal amount thereunder does not exceed $300,000),  Grantors (i) without the prior written consent of Agent, will not (A) waive or release any obligation  of any Person that is obligated under any of the Pledged Notes, (B) take or omit to take any action  or knowingly suffer or permit any action to be omitted or taken, the taking or omission of which  would result in any right of offset against sums payable under the Pledged Notes, or (C) other than  Permitted Dispositions, assign or surrender their rights and interests under any of the Pledged  Notes or terminate, cancel, modify, change, supplement or amend the Pledged Notes, and (ii) shall  provide to Agent copies of all material written notices (including notices of default) given or  received with respect to the Pledged Notes promptly after giving or receiving such notice.  (p) Keepwell.  Each Qualified ECP Grantor  hereby jointly and severally  absolutely, unconditionally and irrevocably undertakes to provide such funds or other support as  may be needed from time to time by each other Loan Party to guaranty and otherwise honor all  Obligations in respect of Swap Obligations.  The obligations of each Qualified ECP Grantor under  this Section shall remain in full force and effect until payment in full of the Obligations.  Each  Qualified ECP Grantor intends that this Section 7(p) constitute, and this Section 7(p) shall be  deemed to constitute, a "keepwell, support, or other agreement" for the benefit of each other  Grantor for all purposes of Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.  8. Relation to Other Security Documents.  The provisions of this Agreement shall be  read and construed with the other Loan Documents referred to below in the manner so indicated.  (a) Credit Agreement. In the event of any conflict between any provision in this  Agreement and a provision in the Credit Agreement, such provision of the Credit Agreement shall  control.  





 






  -31-  122895846v5  (b) Patent, Trademark, Copyright Security Agreements.  The provisions of the  Copyright Security Agreements, Trademark Security Agreements, and Patent Security  Agreements are supplemental to the provisions of this Agreement, and nothing contained in the  Copyright Security Agreements, Trademark Security Agreements, or the Patent Security  Agreements shall limit any of the rights or remedies of Agent hereunder.  In the event of any  conflict between any provision in this Agreement and a provision in a Copyright Security  Agreement, Trademark Security Agreement or Patent Security Agreement, such provision of this  Agreement shall control.  9. Further Assurances.  (a) Subject to and in accordance with Section 5.12 of the Credit Agreement,  each Grantor agrees that from time to time, at its own expense, such Grantor will promptly execute  and deliver all further instruments and documents, and take all further action, that Agent may  reasonably request, in order to perfect and protect the Security Interest granted hereby, to create,  perfect or protect the Security Interest purported to be granted hereby or to enable Agent to exercise  and enforce its rights and remedies hereunder with respect to any of the Collateral.  (b) Each Grantor authorizes the filing by Agent of financing or continuation  statements, or amendments thereto, and such Grantor will execute and deliver to Agent such other  instruments or notices, as Agent may reasonably request, in order to perfect and preserve the  Security Interest granted or purported to be granted hereby.  (c) Each Grantor authorizes Agent at any time and from time to time to file,  transmit, or communicate, as applicable, financing statements and amendments (i) describing the  Collateral as "all personal property of debtor" or "all assets of debtor" or words of similar effect,  (ii) describing the Collateral as being of equal or lesser scope or with greater detail, or (iii) that  contain any information required by part 5 of Article 9 of the Code for the sufficiency or filing  office acceptance.  Each Grantor also hereby ratifies any and all financing statements or  amendments previously filed by Agent in connection with the Loan Documents in any jurisdiction.  (d) Each Grantor acknowledges that it is not authorized to file any financing  statement or amendment or termination statement with respect to any financing statement filed in  connection with this Agreement without the prior written consent of Agent, subject to such  Grantor's rights under Section 9-509(d)(2) of the Code.  10. Agent's Right to Perform Contracts, Exercise Rights, etc.  Upon the occurrence and  during the continuance of an Event of Default, Agent (or its designee) (a) may proceed to perform  any and all of the obligations of any Grantor contained in any contract, lease, or other agreement  and exercise any and all rights of any Grantor therein contained as fully as such Grantor itself  could, (b) shall have the right (subject to Section 17(b)) to use any Grantor's rights under  Intellectual Property Licenses in connection with the enforcement of Agent's rights hereunder,  including the right to prepare for sale and sell any and all Inventory and Equipment now or  hereafter owned by any Grantor and now or hereafter covered by such licenses, and (c) shall have  the right to request that any Equity Interests that are pledged hereunder be registered in the name  of Agent or any of its nominees.  





 






  -32-  122895846v5  11. Agent Appointed Attorney-in-Fact.  Each Grantor hereby irrevocably appoints  Agent its attorney-in-fact, with full authority in the place and stead of such Grantor and in the  name of such Grantor or otherwise, at such time as an Event of Default has occurred and is  continuing under the Credit Agreement, to take any action and to execute any instrument which  Agent may reasonably deem necessary or advisable to accomplish the purposes of this Agreement,  including:  (a) to ask, demand, collect, sue for, recover, compromise, receive and give  acquittance and receipts for moneys due and to become due under or in connection with the  Accounts or any other Collateral of such Grantor;  (b) to receive and open all mail addressed to such Grantor and to notify postal  authorities to change the address for the delivery of mail to such Grantor to that of Agent;  (c) to receive, indorse, and collect any drafts or other instruments, documents,  Negotiable Collateral or Chattel Paper;  (d) to file any claims or take any action or institute any proceedings which  Agent may deem necessary or desirable for the collection of any of the Collateral of such Grantor  or otherwise to enforce the rights of Agent with respect to any of the Collateral;  (e) to repair, alter, or supply goods, if any, necessary to fulfill in whole or in  part the purchase order of any Person obligated to such Grantor in respect of any Account of such  Grantor;  (f) to use any Intellectual Property or Intellectual Property Licenses of such  Grantor, including but not limited to any labels, Patents, Trademarks, trade names, URLs, domain  names, industrial designs, Copyrights, or advertising matter, in preparing for sale, advertising for  sale, or selling Inventory or other Collateral and to collect any amounts due under Accounts,  contracts or Negotiable Collateral of such Grantor; and  (g) Agent, on behalf of the Lender Group, shall have the right, but shall not be  obligated, to bring suit in its own name to enforce the Intellectual Property and Intellectual  Property Licenses and, if Agent shall commence any such suit, the appropriate Grantor shall, at  the request of Agent, do any and all lawful acts and execute any and all proper documents  reasonably required by Agent in aid of such enforcement.  To the extent permitted by law, each Grantor hereby ratifies all that such attorney-in-fact  shall lawfully do or cause to be done by virtue hereof.  This power of attorney is coupled with an  interest and shall be irrevocable until this Agreement is terminated.  12. Agent May Perform.  If any Grantor fails to perform any agreement contained  herein, after expiration of any applicable grace or cure period under the Loan Documents and upon  written notice (which shall be prior or concurrent) to the applicable Grantor, Agent may itself  perform, or cause performance of, such agreement, and the reasonable and documented expenses  of Agent incurred in connection therewith shall be payable, jointly and severally, by Grantors in  accordance with the terms of the Credit Agreement.  





 






  -33-  122895846v5  13. Agent's Duties.  The powers conferred on Agent hereunder are solely to protect  Agent's interest in the Collateral, for the benefit of the Lender Group, and shall not impose any  duty upon Agent to exercise any such powers.  Except for the safe custody of any Collateral in its  actual possession and the accounting for moneys actually received by it hereunder, Agent shall  have no duty as to any Collateral or as to the taking of any necessary steps to preserve rights against  prior parties or any other rights pertaining to any Collateral.  Agent shall be deemed to have  exercised reasonable care in the custody and preservation of any Collateral in its actual possession  if such Collateral is accorded treatment substantially equal to that which Agent accords its own  property.  14. Collection of Accounts, General Intangibles and Negotiable Collateral.  At any time  upon the occurrence and during the continuance of an Event of Default, Agent or Agent's designee  may (a) make direct verification from Account Debtors with respect to any or all Accounts that  are part of the Collateral, (b) notify Account Debtors of any Grantor that the Accounts, General  Intangibles, Chattel Paper or Negotiable Collateral of such Grantor have been assigned to Agent,  for the benefit of the Lender Group, or that Agent has a security interest therein, or (c) collect the  Accounts, General Intangibles and Negotiable Collateral of any Grantor directly, and any  collection costs and expenses shall constitute part of such Grantor's Secured Obligations under the  Loan Documents.  15. Disposition of Pledged Interests by Agent.  None of the Pledged Interests existing  as of the date of this Agreement are, and none of the Pledged Interests hereafter acquired on the  date of acquisition thereof will be, registered or qualified under the various federal or state  securities laws of the United States and disposition thereof after an Event of Default has occurred  and is continuing may be restricted to one or more private (instead of public) sales in view of the  lack of such registration.  Each Grantor understands that in connection with such disposition,  Agent may approach only a restricted number of potential purchasers and further understands that  a sale under such circumstances may yield a lower price for the Pledged Interests than if the  Pledged Interests were registered and qualified pursuant to federal and state securities laws and  sold on the open market.  Each Grantor, therefore, agrees that:  (a) if Agent shall, pursuant to the  terms of this Agreement, sell or cause the Pledged Interests or any portion thereof to be sold at a  private sale, Agent shall have the right to rely upon the advice and opinion of any nationally  recognized brokerage or investment firm (but shall not be obligated to seek such advice and the  failure to do so shall not be considered in determining the commercial reasonableness of such  action) as to the best manner in which to offer the Pledged Interest or any portion thereof for sale  and as to the best price reasonably obtainable at the private sale thereof, and (b) such reliance shall  be conclusive evidence that Agent has handled the disposition in a commercially reasonable  manner.  16. Voting and Other Rights in Respect of Pledged Interests.  (a) Upon the occurrence and during the continuation of an Event of Default, (i)  Agent may, at its option, and in addition to all rights and remedies available to Agent under any  other agreement, at law, in equity, or otherwise, exercise all voting rights, or any other ownership  or consensual rights (including any dividend or distribution rights) in respect of the Pledged  Interests owned by such Grantor, but under no circumstances is Agent obligated by the terms of  this Agreement to exercise such rights, and (ii) if Agent duly exercises its right to vote any of such  





 






  -34-  122895846v5  Pledged Interests, each Grantor hereby appoints Agent, such Grantor's true and lawful attorney- in-fact and IRREVOCABLE PROXY to vote such Pledged Interests in any manner Agent deems  advisable for or against all matters submitted or which may be submitted to a vote of shareholders,  partners or members, as the case may be.  The power-of-attorney and proxy granted hereby is  coupled with an interest and shall be irrevocable.  (b) For so long as any Grantor shall have the right to vote the Pledged Interests  owned by it, such Grantor covenants and agrees that it will not, without the prior written consent  of Agent, vote or take any consensual action with respect to such Pledged Interests which would  reasonably be expected to materially adversely affect the rights of Agent or the other members of  the Lender Group, or the value of the Pledged Interests.  17. Remedies.  Upon the occurrence and during the continuance of an Event of Default:  (a) Agent may, and, at the instruction of the Required Lenders, shall exercise  in respect of the Collateral, in addition to other rights and remedies provided for herein, in the  other Loan Documents, or otherwise available to it, all the rights and remedies of a secured party  on default under the Code or any other applicable law.  Without limiting the generality of the  foregoing, each Grantor expressly agrees that, in any such event, Agent without demand of  performance or other demand, advertisement or notice of any kind (except a notice specified below  of time and place of public or private sale) to or upon any Grantor or any other Person (all and  each of which demands, advertisements and notices are hereby expressly waived to the maximum  extent permitted by the Code or any other applicable law), may take immediate possession of all  or any portion of the Collateral and (i) require Grantors to, and each Grantor hereby agrees that it  will at its own expense and upon request of Agent forthwith, assemble all or part of the Collateral  as directed by Agent and make it available to Agent at one or more locations where such Grantor  regularly maintains Inventory, and (ii) without notice except as specified below, sell the Collateral  or any part thereof in one or more parcels at public or private sale, at any of Agent's offices or  elsewhere, for cash, on credit, and upon such other terms as Agent may deem commercially  reasonable.  Each Grantor agrees that, to the extent notification of sale shall be required by law, at  least ten days notification by mail to the applicable Grantor of the time and place of any public  sale or the time after which any private sale is to be made shall constitute reasonable notification  and specifically such notification shall constitute a reasonable "authenticated notification of  disposition" within the meaning of Section 9-611 of the Code.  Agent shall not be obligated to  make any sale of Collateral regardless of notification of sale having been given.  Agent may  adjourn any public sale from time to time by announcement at the time and place fixed therefor,  and such sale may, without further notice, be made at the time and place to which it was so  adjourned.  Each Grantor agrees that (A) the internet shall constitute a "place" for purposes of  Section 9-610(b) of the Code, and (B) to the extent notification of sale shall be required by law,  notification by mail of the URL where a sale will occur and the time when a sale will commence  at least ten days prior to the sale shall constitute a reasonable notification for purposes of Section  9-611(b) of the Code.  Each Grantor agrees that any sale of Collateral to a licensor pursuant to the  terms of a license agreement between such licensor and a Grantor is sufficient to constitute a  commercially reasonable sale (including as to method, terms, manner, and time) within the  meaning of Section 9-610 of the Code.  





 






  -35-  122895846v5  (b) Agent is hereby granted a license or other right to use, without liability for  royalties or any other charge, each Grantor's Intellectual Property, including but not limited to, any  labels, Patents, Trademarks, trade names, URLs, domain names, industrial designs, Copyrights,  and advertising matter, whether owned by any Grantor or with respect to which any Grantor has  rights under license, sublicense, or other agreements (including any Intellectual Property License),  as it pertains to the Collateral, in preparing for sale, advertising for sale and selling any Collateral,  and each Grantor's rights under all licenses and all franchise agreements shall inure to the benefit  of Agent.  (c) Agent may, in addition to other rights and remedies provided for herein, in  the other Loan Documents, or otherwise available to it under applicable law and without the  requirement of notice to or upon any Grantor or any other Person (which notice is hereby expressly  waived to the maximum extent permitted by the Code or any other applicable law), (i) with respect  to any Grantor's Deposit Accounts in which Agent's Liens are perfected by control under Section  9-104 of the Code, instruct the bank maintaining such Deposit Account for the applicable Grantor  to pay the balance of such Deposit Account to or for the benefit of Agent, and (ii) with respect to  any Grantor's Securities Accounts in which Agent's Liens are perfected by control under Section  9-106 of the Code, instruct the securities intermediary maintaining such Securities Account for the  applicable Grantor to (A) transfer any cash in such Securities Account to or for the benefit of  Agent, or (B) liquidate any financial assets in such Securities Account that are customarily sold on  a recognized market and transfer the cash proceeds thereof to or for the benefit of Agent.  (d) Any cash held by Agent as Collateral and all cash proceeds received by  Agent in respect of any sale of, collection from, or other realization upon all or any part of the  Collateral shall be applied against the Secured Obligations in the order set forth in the Credit  Agreement.   In the event the proceeds of Collateral are insufficient to satisfy all of the Secured  Obligations in full, each Grantor shall remain jointly and severally liable for any such deficiency.  (e) Each Grantor hereby acknowledges that the Secured Obligations arise out  of a commercial transaction, and agrees that if an Event of Default shall occur and be continuing  Agent shall have the right to an immediate writ of possession without notice of a hearing.  Agent  shall have the right to the appointment of a receiver for the properties and assets of each Grantor,  and each Grantor hereby consents to such rights and such appointment and hereby waives any  objection such Grantor may have thereto or the right to have a bond or other security posted by  Agent.  18. Remedies Cumulative.  Each right, power, and remedy of Agent or any other  member of the Lender Group as provided for in this Agreement or the other Loan Documents now  or hereafter existing at law or in equity or by statute or otherwise shall be cumulative and  concurrent and shall be in addition to every other right, power, or remedy provided for in this  Agreement and the other Loan Documents now or hereafter existing at law or in equity or by  statute or otherwise, and the exercise or beginning of the exercise by Agent or any other member  of the Lender Group, of any one or more of such rights, powers, or remedies shall not preclude the  simultaneous or later exercise by Agent or such other member of the Lender Group of any or all  such other rights, powers, or remedies.  





 






  -36-  122895846v5  19. Marshaling. Agent  shall not be required to marshal any present or future collateral  security (including but not limited to the Collateral) for, or other assurances of payment of, the  Secured Obligations or any of them or to resort to such collateral security or other assurances of  payment in any particular order, and all of its rights and remedies hereunder and in respect of such  collateral security and other assurances of payment shall be cumulative and in addition to all other  rights and remedies, however existing or arising.  To the extent that it lawfully may, each Grantor  hereby agrees that it will not invoke any law relating to the marshaling of collateral which might  cause delay in or impede the enforcement of Agent's rights and remedies under this Agreement or  under any other instrument creating or evidencing any of the Secured Obligations or under which  any of the Secured Obligations is outstanding or by which any of the Secured Obligations is  secured or payment thereof is otherwise assured, and, to the extent that it lawfully may, each  Grantor hereby irrevocably waives the benefits of all such laws.  20. Indemnity.  Each Grantor agrees to indemnify Agent and the other members of the  Lender Group from and against all claims, lawsuits and liabilities (including reasonable and  documented attorneys' fees) arising out of or resulting from this Agreement (including  enforcement of this Agreement) or any other Loan Document to which such Grantor is a party, in  each case, in accordance with and to the extent set forth in Section 10.3 of the Credit Agreement.   This provision shall survive the termination of this Agreement and the Credit Agreement and the  repayment of the Secured Obligations.  21. Merger, Amendments; Etc.  THIS AGREEMENT, TOGETHER WITH THE  OTHER LOAN DOCUMENTS, REPRESENTS THE FINAL AGREEMENT BETWEEN THE  PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,  CONTEMPORANEOUS OR ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO  UNWRITTEN AGREEMENTS BETWEEN THE PARTIES.  No waiver of any provision of this  Agreement, and no consent to any departure by any Grantor herefrom, shall in any event be  effective unless the same shall be in writing and signed by Agent, and then such waiver or consent  shall be effective only in the specific instance and for the specific purpose for which given.  No  amendment of any provision of this Agreement shall be effective unless the same shall be in  writing and signed by Agent and each Grantor to which such amendment applies.  22. Addresses for Notices.  All notices and other communications provided for  hereunder shall be given in the form and manner and delivered to Agent at its address specified in  the Credit Agreement, and to any of the Grantors at the notice address specified for Loan Parties  in the Credit Agreement, or as to any party, at such other address as shall be designated by such  party in a written notice to the other party.  23. Continuing Security Interest: Assignments under Credit Agreement.  (a) This Agreement shall create a continuing security interest in the Collateral  and shall (i) remain in full force and effect until the Obligations have been paid in full in  accordance with the provisions of the Credit Agreement and the Commitments have expired or  have been terminated, (ii) be binding upon each Grantor, and their respective successors and  assigns, and (iii) inure to the benefit of, and be enforceable by, Agent, and its successors,  transferees and assigns.  Without limiting the generality of the foregoing clause (iii), any Lender  may, in accordance with the provisions of the Credit Agreement, assign or otherwise transfer all  





 






  -37-  122895846v5  or any portion of its rights and obligations under the Credit Agreement to any other Person, and  such other Person shall thereupon become vested with all the benefits in respect thereof granted to  such Lender herein or otherwise.  Upon payment in full of the Secured Obligations in accordance  with the provisions of the Credit Agreement and the expiration or termination of the Commitments,  the Guaranty made and the Security Interest granted hereby shall terminate and all rights to the  Collateral shall revert to Grantors or any other Person entitled thereto.  At such time, upon  Borrowers' request (and at the sole expense of Borrowers), Agent will authorize the filing of  appropriate termination statements to terminate such Security Interest, return any Collateral then  in Agent's possession and execute and deliver any documents, and take any actions, as Borrowers  reasonably request to evidence the termination and release of the Agent's Liens in the Collateral.   No transfer or renewal, extension, assignment, or termination of this Agreement or of the Credit  Agreement, any other Loan Document, or any other instrument or document executed and  delivered by any Grantor to Agent, nor the taking of further security, nor the retaking or re-delivery  of the Collateral to Grantors, or any of them, by Agent, nor any other act of the Lender Group, or  any of them, shall release any Grantor from any obligation, except a release or discharge executed  in writing by Agent in accordance with the provisions of the Credit Agreement.  Agent shall not  by any act, delay, omission or otherwise, be deemed to have waived any of its rights or remedies  hereunder, unless such waiver is in writing and signed by Agent and then only to the extent therein  set forth.  A waiver by Agent of any right or remedy on any occasion shall not be construed as a  bar to the exercise of any such right or remedy which Agent would otherwise have had on any  other occasion.  (b) If any member of the Lender Group repays, refunds, restores, or returns in  whole or in part, any payment or property (including any proceeds of Collateral) previously paid  or transferred to such member of the Lender Group in full or partial satisfaction of any Secured  Obligation or on account of any other obligation of any Loan Party under any Loan Document,  because the payment, transfer, or the incurrence of the obligation so satisfied is asserted or declared  to be void, voidable, or otherwise recoverable under any law relating to creditors' rights, including  provisions of the Bankruptcy Code relating to fraudulent transfers, preferences, or other voidable  or recoverable obligations or transfers (each, a "Voidable Transfer"), or because such member of  the Lender Group elects to do so on the reasonable advice of its counsel in connection with a claim  that the payment, transfer, or incurrence is or may be a Voidable Transfer, then, as to any such  Voidable Transfer, or the amount thereof that such member of the Lender Group elects to repay,  restore, or return (including pursuant to a settlement of any claim in respect thereof), and as to all  reasonable and documented costs, expenses, and attorneys' fees of such member of the Lender  Group related thereto, (i) the liability of the Loan Parties with respect to the amount or property  paid, refunded, restored, or returned will automatically and immediately be revived, reinstated,  and restored and will exist, and (ii) Agent's Liens securing such liability shall be effective, revived,  and remain in full force and effect, in each case, as fully as if such Voidable Transfer had never  been made.  If, prior to any of the foregoing, (A) Agent's Liens shall have been released or  terminated, or (B) any provision of this Agreement shall have been terminated or cancelled,  Agent's Liens, or such provision of this Agreement, shall be reinstated in full force and effect and  such prior release, termination, cancellation or surrender shall not diminish, release, discharge,  impair or otherwise affect the obligation of any Loan Party in respect of such liability or any  Collateral securing such liability.  





 






  -38-  122895846v5  (c) In connection with any Disposition of Collateral permitted pursuant to  Section 6.4 of the Credit Agreement, Agent hereby acknowledges and agrees in accordance with  Section 15.11(a) of the Credit Agreement to promptly release Agent's Lien in such Collateral and  to promptly execute and deliver, upon the applicable Grantor's reasonable written request therefor  (and at the sole expense of such Grantor), such documents, releases or other evidence of  termination of the Agent's Lien in such Collateral.  24. Survival.  All representations and warranties made by the Grantors in this  Agreement and in the certificates or other instruments delivered in connection with or pursuant to  this Agreement shall be considered to have been relied upon by the other parties hereto and shall  survive the execution and delivery of this Agreement and the making of any loans and issuance of  any Letters of Credit, regardless of any investigation made by any such other party or on its behalf  and notwithstanding that Agent, Issuing Lender, or any Lender may have had notice or knowledge  of any Default or Event of 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 the  Credit Agreement is outstanding and unpaid or any Letter of Credit is outstanding and so long as  the Commitments have not expired or terminated.  25. CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER; JUDICIAL  REFERENCE PROVISION.  (a) THE VALIDITY OF THIS AGREEMENT, THE CONSTRUCTION,  INTERPRETATION, AND ENFORCEMENT HEREOF, THE RIGHTS OF THE PARTIES  HERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR RELATED  HERETO, AND ANY CLAIMS, CONTROVERSIES OR DISPUTES ARISING HEREUNDER  OR RELATED HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND  CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.  (b) THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS  ARISING IN CONNECTION WITH THIS AGREEMENT SHALL BE TRIED AND  LITIGATED ONLY IN THE STATE OF NEW YORK AND, TO THE EXTENT PERMITTED  BY APPLICABLE LAW, FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK,  STATE OF NEW YORK; PROVIDED, THAT ANY SUIT SEEKING ENFORCEMENT  AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT AGENT'S  OPTION, IN THE COURTS OF ANY JURISDICTION WHERE AGENT ELECTS TO BRING  SUCH ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE  FOUND.  EACH GRANTOR AND AGENT WAIVE, TO THE EXTENT PERMITTED UNDER  APPLICABLE LAW, ANY RIGHT EACH MAY HAVE TO ASSERT THE DOCTRINE OF  FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE EXTENT ANY  PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 25(b).  (c) TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW,  EACH GRANTOR AND AGENT HEREBY WAIVE THEIR RESPECTIVE RIGHTS, IF ANY,  TO A JURY TRIAL OF ANY CLAIM, CONTROVERSY, DISPUTE OR CAUSE OF ACTION  DIRECTLY OR INDIRECTLY BASED UPON OR ARISING OUT OF THIS AGREEMENT  OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING CONTRACT  





 






  -39-  122895846v5  CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON  LAW OR STATUTORY CLAIMS (EACH A "CLAIM").  EACH GRANTOR AND AGENT  REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY  AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION  WITH LEGAL COUNSEL.  IN THE EVENT OF LITIGATION, A COPY OF THIS  AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.  (d) EACH GRANTOR HEREBY IRREVOCABLY AND  UNCONDITIONALLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE STATE  AND FEDERAL COURTS LOCATED IN THE COUNTY OF NEW YORK AND THE STATE  OF NEW YORK, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING  TO THIS AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT OF ANY  JUDGMENT.  EACH OF THE PARTIES 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 SHALL  AFFECT ANY RIGHT THAT AGENT MAY OTHERWISE HAVE TO BRING ANY ACTION  OR PROCEEDING RELATING TO THIS AGREEMENT AGAINST ANY GRANTOR OR ITS  PROPERTIES IN THE COURTS OF ANY JURISDICTION.  (e) NO CLAIM MAY BE MADE BY ANY GRANTOR, ON THE ONE  HAND, OR ANY MEMBER OF THE LENDER GROUP, ON THE OTHER, AGAINST EACH  OTHER, OR ANY OF THEIR RESPECTIVE AFFILIATES, DIRECTORS, OFFICERS,  EMPLOYEES, COUNSELS, REPRESENTATIVES, AGENTS, OR ATTORNEYS-IN-FACT  FOR ANY SPECIAL, INDIRECT, CONSEQUENTIAL, OR PUNITIVE DAMAGES IN  RESPECT OF ANY CLAIM FOR BREACH OF CONTRACT OR ANY OTHER THEORY OF  LIABILITY ARISING OUT OF OR RELATED TO THE TRANSACTIONS CONTEMPLATED  BY THIS AGREEMENT, OR ANY ACT, OMISSION, OR EVENT OCCURRING IN  CONNECTION HEREWITH, AND EACH SUCH PERSON HEREBY WAIVES, RELEASES,  AND AGREES NOT TO SUE UPON ANY CLAIM FOR SUCH DAMAGES, WHETHER OR  NOT ACCRUED AND WHETHER OR NOT KNOWN OR SUSPECTED TO EXIST IN ITS  FAVOR.  (f) IN THE EVENT ANY LEGAL PROCEEDING IS FILED IN A COURT  OF THE STATE OF CALIFORNIA (THE "COURT") BY OR AGAINST ANY PARTY  HERETO IN CONNECTION WITH ANY CLAIM AND THE WAIVER SET FORTH IN  SECTION 25(c) ABOVE IS NOT ENFORCEABLE IN SUCH PROCEEDING, THE PARTIES  HERETO AGREE AS FOLLOWS:  (i) WITH THE EXCEPTION OF THE MATTERS SPECIFIED IN  SUBCLAUSE (ii) BELOW, ANY CLAIM SHALL BE DETERMINED BY A GENERAL  REFERENCE PROCEEDING IN ACCORDANCE WITH THE PROVISIONS OF  CALIFORNIA CODE OF CIVIL PROCEDURE SECTIONS 638 THROUGH 645.1.  THE  PARTIES INTEND THIS GENERAL REFERENCE AGREEMENT TO BE SPECIFICALLY  ENFORCEABLE.  VENUE FOR THE REFERENCE PROCEEDING SHALL BE IN THE  COUNTY OF LOS ANGELES, CALIFORNIA.  





 






  -40-  122895846v5  (ii) THE FOLLOWING MATTERS SHALL NOT BE SUBJECT TO A  GENERAL REFERENCE PROCEEDING: (A) NON-JUDICIAL FORECLOSURE OF ANY  SECURITY INTERESTS IN REAL OR PERSONAL PROPERTY, (B) EXERCISE OF SELF- HELP REMEDIES (INCLUDING SET-OFF OR RECOUPMENT), (C) APPOINTMENT OF A  RECEIVER, AND (D) TEMPORARY, PROVISIONAL, OR ANCILLARY REMEDIES  (INCLUDING WRITS OF ATTACHMENT, WRITS OF POSSESSION, TEMPORARY  RESTRAINING ORDERS, OR PRELIMINARY INJUNCTIONS).  THIS AGREEMENT DOES  NOT LIMIT THE RIGHT OF ANY PARTY TO EXERCISE OR OPPOSE ANY OF THE  RIGHTS AND REMEDIES DESCRIBED IN CLAUSES (A) THROUGH (D) AND ANY SUCH  EXERCISE OR OPPOSITION DOES NOT WAIVE THE RIGHT OF ANY PARTY TO  PARTICIPATE IN A REFERENCE PROCEEDING PURSUANT TO THIS AGREEMENT  WITH RESPECT TO ANY OTHER MATTER.  (iii) UPON THE WRITTEN REQUEST OF ANY PARTY, THE  PARTIES SHALL SELECT A SINGLE REFEREE, WHO SHALL BE A RETIRED JUDGE OR  JUSTICE.  IF THE PARTIES DO NOT AGREE UPON A REFEREE WITHIN TEN DAYS OF  SUCH WRITTEN REQUEST, THEN, ANY PARTY SHALL HAVE THE RIGHT TO  REQUEST THE COURT TO APPOINT A REFEREE PURSUANT TO CALIFORNIA CODE  OF CIVIL PROCEDURE SECTION 640(B).  THE REFEREE SHALL BE APPOINTED TO SIT  WITH ALL OF THE POWERS PROVIDED BY LAW.  PENDING APPOINTMENT OF THE  REFEREE, THE COURT SHALL HAVE THE POWER TO ISSUE TEMPORARY OR  PROVISIONAL REMEDIES.  (iv) EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT,  THE REFEREE SHALL DETERMINE THE MANNER IN WHICH THE REFERENCE  PROCEEDING IS CONDUCTED INCLUDING THE TIME AND PLACE OF HEARINGS,  THE ORDER OF PRESENTATION OF EVIDENCE, AND ALL OTHER QUESTIONS THAT  ARISE WITH RESPECT TO THE COURSE OF THE REFERENCE PROCEEDING.  ALL  PROCEEDINGS AND HEARINGS CONDUCTED BEFORE THE REFEREE, EXCEPT FOR  TRIAL, SHALL BE CONDUCTED WITHOUT A COURT REPORTER, EXCEPT WHEN ANY  PARTY SO REQUESTS A COURT REPORTER AND A TRANSCRIPT IS ORDERED, A  COURT REPORTER SHALL BE USED AND THE REFEREE SHALL BE PROVIDED A  COURTESY COPY OF THE TRANSCRIPT.  THE PARTY MAKING SUCH REQUEST  SHALL HAVE THE OBLIGATION TO ARRANGE FOR AND PAY THE COSTS OF THE  COURT REPORTER; PROVIDED, THAT SUCH COSTS, ALONG WITH THE REFEREE'S  FEES, SHALL ULTIMATELY BE BORNE BY THE PARTY WHO DOES NOT PREVAIL, AS  DETERMINED BY THE REFEREE.  (v) THE REFEREE MAY REQUIRE ONE OR MORE PREHEARING  CONFERENCES.  THE PARTIES HERETO SHALL BE ENTITLED TO DISCOVERY, AND  THE REFEREE SHALL OVERSEE DISCOVERY IN ACCORDANCE WITH THE RULES OF  DISCOVERY, AND SHALL ENFORCE ALL DISCOVERY ORDERS IN THE SAME  MANNER AS ANY TRIAL COURT JUDGE IN PROCEEDINGS AT LAW IN THE STATE OF  CALIFORNIA.  (vi) THE REFEREE SHALL APPLY THE RULES OF EVIDENCE  APPLICABLE TO PROCEEDINGS AT LAW IN THE STATE OF CALIFORNIA AND SHALL  





 






  -41-  122895846v5  DETERMINE ALL ISSUES IN ACCORDANCE WITH CALIFORNIA SUBSTANTIVE AND  PROCEDURAL LAW.  THE REFEREE SHALL BE EMPOWERED TO ENTER EQUITABLE  AS WELL AS LEGAL RELIEF AND RULE ON ANY MOTION WHICH WOULD BE  AUTHORIZED IN A TRIAL, INCLUDING MOTIONS FOR DEFAULT JUDGMENT OR  SUMMARY JUDGMENT.  THE REFEREE SHALL REPORT HIS OR HER DECISION,  WHICH REPORT SHALL ALSO INCLUDE FINDINGS OF FACT AND CONCLUSIONS OF  LAW.  THE REFEREE SHALL ISSUE A DECISION AND PURSUANT TO CALIFORNIA  CODE OF CIVIL PROCEDURE, SECTION 644, THE REFEREE'S DECISION SHALL BE  ENTERED BY THE COURT AS A JUDGMENT IN THE SAME MANNER AS IF THE  ACTION HAD BEEN TRIED BY THE COURT.  THE FINAL JUDGMENT OR ORDER FROM  ANY APPEALABLE DECISION OR ORDER ENTERED BY THE REFEREE SHALL BE  FULLY APPEALABLE AS IF IT HAS BEEN ENTERED BY THE COURT.  (vii) THE PARTIES RECOGNIZE AND AGREE THAT ALL CLAIMS  RESOLVED IN A GENERAL REFERENCE PROCEEDING PURSUANT HERETO WILL BE  DECIDED BY A REFEREE AND NOT BY A JURY.  AFTER CONSULTING (OR HAVING  HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR OWN CHOICE,  EACH PARTY HERETO KNOWINGLY AND VOLUNTARILY AND FOR THEIR MUTUAL  BENEFIT AGREES THAT THIS REFERENCE PROVISION SHALL APPLY TO ANY  DISPUTE BETWEEN THEM THAT ARISES OUT OF OR IS RELATED TO THIS  AGREEMENT.  26. New Subsidiaries.  Pursuant to Section 5.11 of the Credit Agreement, certain  Subsidiaries (whether by acquisition or creation) of any Grantor are required to enter into this  Agreement by executing and delivering in favor of Agent a Joinder to this Agreement in  substantially the form of Annex 1.  Upon the execution and delivery of Annex 1 by any such new  Subsidiary, such Subsidiary shall become a Guarantor and/or Grantor hereunder with the same  force and effect as if originally named as a Guarantor and/or Grantor herein.  The execution and  delivery of any instrument adding an additional Guarantor or Grantor as a party to this Agreement  shall not require the consent of any Guarantor or Grantor hereunder.  The rights and obligations of  each Guarantor and Grantor hereunder shall remain in full force and effect notwithstanding the  addition of any new Guarantor or Grantor hereunder.  27. Agent.  Each reference herein to any right granted to, benefit conferred upon or  power exercisable by the "Agent" shall be a reference to Agent, for the benefit of each member of  the Lender Group.  28. Miscellaneous.  (a) This Agreement is a Loan Document.  This Agreement may be executed in  any number of counterparts and by different parties on separate counterparts, each of which, when  executed and delivered, shall be deemed to be an original, and all of which, when taken together,  shall constitute but one and the same Agreement.  Delivery of an executed counterpart of this  Agreement by telefacsimile or other electronic method of transmission shall be equally as effective  as delivery of an original executed counterpart of this Agreement.  Any party delivering an  executed counterpart of this Agreement by telefacsimile or other electronic method of transmission  also shall deliver an original executed counterpart of this Agreement but the failure to deliver an  





 






  -42-  122895846v5  original executed counterpart shall not affect the validity, enforceability, and binding effect of this  Agreement.  The foregoing shall apply to each other Loan Document mutatis mutandis.  (b) Any provision of this Agreement which is prohibited or unenforceable shall  be ineffective to the extent of such prohibition or unenforceability without invalidating the  remaining provisions hereof in that jurisdiction or affecting the validity or enforceability of such  provision in any other jurisdiction.  Each provision of this Agreement shall be severable from  every other provision of this Agreement for the purpose of determining the legal enforceability of  any specific provision.  (c) Headings and numbers have been set forth herein for convenience only.   Unless the contrary is compelled by the context, everything contained in each Section applies  equally to this entire Agreement.  (d) Neither this Agreement nor any uncertainty or ambiguity herein shall be  construed against any member of the Lender Group or any Grantor, whether under any rule of  construction or otherwise.  This Agreement has been reviewed by all parties and shall be construed  and interpreted according to the ordinary meaning of the words used so as to accomplish fairly the  purposes and intentions of all parties hereto.  29. Intercreditor Agreement.  (a) Notwithstanding anything herein to the contrary, in the event of any conflict  between any provision in this Agreement and any provision in the Intercreditor Agreement, such  provision in the Intercreditor Agreement shall control.  (b) Without limiting the generality of the foregoing, and notwithstanding  anything herein to the contrary, any obligation of any Grantor hereunder with respect to the  delivery or control of any Collateral that constitutes ABL Priority Collateral shall be deemed to be  satisfied if such Grantor delivers or provides control of such ABL Priority Collateral to the ABL  Agent in accordance with the requirements of the corresponding provision of the applicable ABL  Loan Document.  Any representation, warranty, covenant or other obligation of any Grantor  hereunder to create a "first priority" security interest in any Collateral that constitutes ABL Priority  Collateral shall be first priority other than any Lien in favor of the ABL Agent.  [Signature pages follow]    





 






IN WITNESS WHEREOF, the undersigned parties hereto have caused this Agreement to be executed and delivered as of the day and year first above written. "Grantors" FARMER BROS. CO., a Delaware corporation By: Name: Title: BOYD ASSETS CO., a Delaware corporation By: Name: Title: clue F,- n a..n of FBC FINANCE COMPANY, a California COFFEE BEAN HOLDING CO., INC., a corporation By: Name: Title: Delaware corporation By: Name: Title: chit e hhoth kW 0 Ph COFFEE BEAN INTERNATIONAL, INC., CHINA MIST BRANDS, INC., a Delaware an Oregon corporation corporation By: Name: Title: Signature Page to Guaranty and Security Agreement By: Name: 510H- e. chTitle:  e' '  •0 y pro cet- 





 






 





 






      122895846v5  SCHEDULE 1    COMMERCIAL TORT CLAIMS    None.    





 






      122895846v5  SCHEDULE 2    COPYRIGHTS    UNITED STATES COPYRIGHTS  Registrations:   OWNER TITLE  REGISTRATION  NUMBER  Farmer Bros. Co.1 Farmer Brothers route  accounting  TXU000082758  Farmer Bros. Co.2 The Brewmatic/Daw  prescription for success  TX0001130633  China Mist Brands,  Inc.3  Oasis Design VA0000746115  China Mist Brands,  Inc.4  Why switch to China  Mist?  TX0003332425  Boyd Assets Co.5 Expresso Cleaning  Ticket  for Reneka 123.  TXu001061982  Boyd Assets Co.6 COFFEE HOUSE  ROASTERS HI-REV  COFFEE.  VA0001626268  Boyd Assets Co. Hewlett-Packard master  job scheduler controller;  DS version  TX0001884754      Applications:  OWNER  APPLICATION  NUMBER                                                    1  Copyright owned by “Farmer Brothers Company”  2  Copyright owned by “Farmer Brothers Company”  3  Copyright owned by “China Mist Tea Company”  4  Copyright owned by “Restaurant Tea Service, Inc., d.b.a. Mist Tea Company”  5  Copyright owned by “Boyd Assets Company”  6  Copyright owned by “Boyd Assets Company”  





 






      122895846v5  None       OTHER (NON-UNITED STATES) COPYRIGHTS  Registrations:  OWNER  REGISTRATION  NUMBER COUNTRY/STATE TITLE  None          Applications:  OWNER  APPLICATION  NUMBER COUNTRY/STATE  None             





 






      122895846v5  SCHEDULE 3    INTELLECTUAL PROPERTY LICENSES  LICENSEE LICENSOR COUNTRY/STATE  REGISTRATION/  APPLICATION  NUMBER, IF ANY DESCRIPTION  Farmer Bros. Co. NuZee, Inc. World-wide  License to use all specifications,  formulas, recipes, blends, brands,  trademarks, service marks, trade  names, logos and other intellectual  property of NuZee Co-Packing  Single Serve Coffee Filters owned  by Licensor in order for Licensee  to perform its obligations under the  Equipment Bailment and Contract  Manufacturing Agreement, dated  as of October 23, 2020, between  Licensor and Licensee.      





 






      122895846v5  SCHEDULE 4    PATENTS  UNITED STATES PATENTS:  Registrations:  OWNER  REGISTRATION  NUMBER DESCRIPTION  Boyd Assets Co. 6786138 Device For Preparing  Milk Froth For  Cappuccino      Applications:  OWNER  APPLICATION  NUMBER DESCRIPTION  None        OTHER (NON-UNITED STATES) PATENTS:  Registrations:  OWNER  REGISTRATION  NUMBER COUNTRY/STATE DESCRIPTION  None         Applications:  OWNER  APPLICATION  NUMBER COUNTRY/STATE DESCRIPTION  None         





 






      122895846v5  SCHEDULE 5    PLEDGED COMPANIES    Name of Grantor  Name of Pledged  Company  Number of  Shares/Units  Class of  Interests  Percentage of  Class Owned  Percentage of  Class Pledged  Certificate  Nos.  Farmer Bros. Co. Boyd Assets Co. 100 Common 100%    100% 3  Farmer Bros. Co. China Mist Brands,  Inc.   100 Common 100% 100% C-02  Farmer Bros. Co. Coffee Bean  Holding Co., Inc.  1,000 Common 100% 100% 11  Farmer Bros. Co. FBC Finance  Company  10,000 Common 100% 100% 2  Coffee Bean  Holding Co., Inc.  Coffee Bean  International, Inc.  100 Common 100% 100% 2    





 






      122895846v5  SCHEDULE 6    TRADEMARKS    





 






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      122895846v5  SCHEDULE 7    NAME; CHIEF EXECUTIVE OFFICE; TAX IDENTIFICATION NUMBERS AND  ORGANIZATIONAL NUMBERS  Name Chief Executive Office  Tax Identification  Number  Organizational  Number  Farmer Bros. Co.  1912 Farmer Brothers Drive  Northlake, Texas 76262  95-0725980 3742785  Boyd Assets Co.  1912 Farmer Brothers Drive  Northlake, Texas 76262  82-2659061 6498468  China Mist Brands, Inc.  1912 Farmer Brothers Drive  Northlake, Texas 76262  81-3861172 61339189  Coffee Bean Holding Co., Inc.  1912 Farmer Brothers Drive  Northlake, Texas 76262  56-2488947 3781157  Coffee Bean International, Inc.  1912 Farmer Brothers Drive  Northlake, Texas 76262  93-0714098 129369-10  FBC Finance Company  1912 Farmer Brothers Drive  Northlake, Texas 76262  95-3428785 0905697      





 






      122895846v5  SCHEDULE 8    OWNED REAL PROPERTY  Address City State Zip  Code        1105 Aviation Dr. Lake Havasu City AZ 86404   3818 S. Evans Blvd Tucson AZ 85714   480 Ryan Ave.  Chico CA 95973   8802 Swigert Ct. Bakersfield CA 93311   9373 Remick Ave   Los Angeles CA 91331   11460 Commercial Pky Castroville CA 95012   2450 Boatman Ave  West Sacramento CA 95691   4243 Arch Rd  Stockton CA 95215   470 E. Todd Rd  Santa Rosa CA 95407   3217 Nebraska Ave Council Bluffs IA 51501   3074 84th Lane N.E. Blaine MN 55449   9 N.E. Skyline Dr. Lee's Summit MO 64086   12832 Pennridge Dr. Bridgeton MO 63044   5911 Office Blvd NE Albuquerque NM 87109   3880 Technology Way Carson City NV 89706   13131 Broadway Ext.  Oklahoma City OK 73114  1912 Farmer Brothers Dr. Northlake TX 76262   2230 S. 2000 West  West Valley City UT 84119  7855 Ostrow St. San Diego CA 92111   2385 N. Walgreens St. Flagstaff AZ 86004   4576 N. Bendel Avenue Fresno CA 93722  17190 Yuma Street Victorville CA 92395   2848 Chipeta Avenue Grand Junction CO 81501   2625 Enterprise Ave Billings MT 59102   460 S. A St. Elko NV 89801  7515 NE 33rd Dr. Portland OR 97211   5753 E. Shelby Dr. Memphis TN 38141   1325 Don Haskins Dr.  El Paso TX 79936   1312 E. Laurel  McAllen TX 78501   10915 E Montgomery Dr. Spokane Valley WA 99206   2301 S. 18th St Union Gap WA 98903  3921 W. Segerstrom Ave. Santa Ana CA 92704  72205 Corporate Way Thousand Palms CA 92276   9901 Bell Ranch Dr. Santa Fe Springs CA 90670  2751 S Lilac Ave Bloomington CA 92316  4930 Center Park Blvd. San Antonio TX 78218  





 






      122895846v5  805 S. Saturn Ave. Idaho Falls ID 83402  2030 Creek Dr. Rapid City SD 57703        





 






      122895846v5  SCHEDULE 9    DEPOSIT ACCOUNTS AND SECURITIES ACCOUNTS  Owner Type of Account  Bank or  Intermediary Account Number  Farmer Bros. Co. Operating Account JP Morgan Chase  Bank, N.A.  687795299  Farmer Bros. Co. Lockbox Account JP Morgan Chase  Bank, N.A.  626513415  Farmer Bros. Co. Lockbox Account JP Morgan Chase  Bank, N.A.  473379837  Farmer Bros. Co. Operating Account Wells Fargo Bank,  N.A.  2000042721280  Farmer Bros. Co. Customer Deposit  Account  Wells Fargo Bank,  N.A.  2000042673105  Farmer Bros. Co. Customer EFT/ACH  Payments  Wells Fargo Bank,  N.A.  2000042721345  Farmer Bros. Co. Excluded Account -  Cash Collateral  Account—Existing  Letters of Credit –  Clause (D) of the  definition of  “Excluded Accounts”  JP Morgan Chase  Bank, N.A.  715323769  Farmer Bros. Co. Excluded Account –  Cash Collateral  Account—Existing  Banking Services  Obligations – Clause  (E) of the definition of  “Excluded Accounts”  JP Morgan Chase  Bank, N.A.  715323835  Farmer Bros.  Co./West Coast  Coffee  West Coast Coffee  Deposit Account  JP Morgan Chase  Bank, N.A.  110838205  Farmer Bros.  Co./West Coast  Coffee  West Coast Coffee  Receivables Account  JP Morgan Chase  Bank, N.A.  115990357  Farmer Bros.  Co./Boyd’s Coffee  Boyd’s Coffee  Operating Account   JP Morgan Chase  Bank, N.A.  206235597  Farmer Bros.  Co./Boyd’s Coffee  Boyd’s Coffee  Depository Account  JP Morgan Chase  Bank, N.A.  206221159  China Mist Brands,  Inc.  Operating Account Wells Fargo Bank,  N.A.  7560074580  





 






      122895846v5  Owner Type of Account  Bank or  Intermediary Account Number  China Mist Brands,  Inc.  Deposit/Retail  Account  Wells Fargo Bank,  N.A.  7560074598  Farmer Bros. Co. Excluded Account –  Hedge Agreement –  Clause (F) of the  definition of  “Excluded Accounts”  StoneX Markets, LLC 9837  Farmer Bros. Co. Excluded Account –  Hedge Agreement –  Clause (F) of the  definition of  “Excluded Accounts”  StoneX Financial Inc. MIC-H2601  Farmer Bros. Co. Excluded Account –  Hedge Agreement –  Clause (F) of the  definition of  “Excluded Accounts”  Macquarie Futures  USA LLC  52319040  Farmer Bros. Co. Excluded Account –  Workers  Compensation –  Clause (B) of the  definition of  “Excluded Accounts”  JP Morgan Chase  Bank, N.A.  687795307  Farmer Bros. Co. Excluded Account –  dormant account –  Clause (A) of the  definition of  “Excluded Accounts”  JP Morgan Chase  Bank, N.A.  3729172891  Farmer Bros. Co. Excluded Account –  payroll account –  Clause (B) of the  definition of  “Excluded Accounts”  JP Morgan Chase  Bank, N.A.  687795315  Farmer Bros. Co. Excluded Account –  disbursement account  – Clause (A) of the  definition of  “Excluded Accounts”  JP Morgan Chase  Bank, N.A.  687795323    





 






      122895846v5  SCHEDULE 10    CONTROLLED ACCOUNT BANKS    1. Wells Fargo Bank, National Association  2. JPMorgan Chase Bank, N.A.      





 






      122895846v5  SCHEDULE 11    LIST OF UNIFORM COMMERCIAL CODE FILING JURISDICTIONS    Grantor Jurisdictions  Farmer Bros. Co. Delaware  Boyd Assets Co. Delaware  China Mist Brands, Inc. Delaware  Coffee Bean Holding Co., Inc. Delaware  Coffee Bean International, Inc. Oregon  FBC Finance Company California    





 






      122895846v5  SCHEDULE 12    TITLED COLLATERAL    





 






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  Annex I - 1    122895846v5  ANNEX 1 TO GUARANTY AND SECURITY AGREEMENT  FORM OF JOINDER  Joinder No. ____ (this "Joinder"), dated as of ____________ 20___, to the Guaranty and  Security Agreement, dated as of April 26, 2021 (as amended, restated, supplemented, or otherwise  modified from time to time, the "Guaranty and Security Agreement"), by and among each of the  parties listed on the signature pages thereto and those additional entities that thereafter become  parties thereto (collectively, jointly and severally, "Grantors" and each, individually, a "Grantor")  and MGG INVESTMENT GROUP LP, a Delaware limited partnership, in its capacity as  administrative agent for each member of the Lender Group (in such capacity, together with its  successors and assigns in such capacity, "Agent").  W I T N E S S E T H:  WHEREAS, pursuant to that certain Credit Agreement dated as of April 26, 2021 (as  amended, restated, supplemented, or otherwise modified from time to time, the "Credit  Agreement") by and among FARMER BROS. CO., a Delaware corporation ("Parent"), and the  Subsidiaries of Parent from time to time party to the Credit Agreement as borrowers in accordance  with the terms thereof (collectively with Parent, each a "Borrower" and individually and  collectively, jointly and severally, the "Borrowers"), the lenders party thereto as "Lenders" (each  of such Lenders, together with its successors and permitted assigns, is referred to hereinafter as a  "Lender"), and Agent, the Lender Group has agreed to make certain financial accommodations  available to Borrowers from time to time pursuant to the terms and conditions thereof;  WHEREAS, initially capitalized terms used herein and not otherwise defined herein shall  have the meanings assigned to such terms in the Guaranty and Security Agreement or, if not  defined therein, in the Credit Agreement, and this Joinder shall be subject to the rules of  construction set forth in Section 1(b) of the Guaranty and Security Agreement, which rules of  construction are incorporated herein by this reference, mutatis mutandis;  WHEREAS, Grantors have entered into the Guaranty and Security Agreement in order to  induce the Lender Group to make certain financial accommodations to Borrowers as provided for  in the Credit Agreement and the other Loan Documents;  WHEREAS, pursuant to Section 5.11 of the Credit Agreement and Section 26 of the  Guaranty and Security Agreement, certain Subsidiaries of the Loan Parties, must execute and  deliver certain Loan Documents, including the Guaranty and Security Agreement, and the joinder  to the Guaranty and Security Agreement by the undersigned new Grantor or Grantors (collectively,  the "New Grantors") may be accomplished by the execution of this Joinder in favor of Agent, for  the benefit of the Lender Group; and  WHEREAS, each New Grantor (a) is [an Affiliate] [a Subsidiary] of Borrowers and, as  such, will benefit by virtue of the financial accommodations extended to Borrowers by the Lender  Group and (b) by becoming a Grantor will benefit from certain rights granted to the Grantors  pursuant to the terms of the Loan Documents.  





 






  Annex I - 2      122895846v5  NOW, THEREFORE, for and in consideration of the foregoing and other good and  valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each New  Grantor hereby agrees as follows:  1. In accordance with Section 26 of the Guaranty and Security Agreement, each New  Grantor, by its signature below, becomes a "Grantor" [and "Guarantor"] under the Guaranty and  Security Agreement with the same force and effect as if originally named therein as a "Grantor"  [and "Guarantor"] and each New Grantor hereby (a) agrees to all of the terms and provisions of  the Guaranty and Security Agreement applicable to it as a "Grantor" [or "Guarantor"]  thereunder, and (b) represents and warrants that the representations and warranties made by it as a  "Grantor" [or "Guarantor"] thereunder are true and correct in all material respects (except that  such materiality qualifier shall not be applicable to any representations and warranties that are  already qualified or modified by materiality in the text thereof) on and as of the date hereof (except  to the extent that such representations and warranties relate solely to an earlier date, in which case  such representations and warranties shall be true and correct in all material respects (except that  such materiality qualifier shall not be applicable to any representations and warranties that already  are qualified or modified by materiality in the text thereof) as of such earlier date).  In furtherance  of the foregoing, each New Grantor hereby [(i) jointly and severally unconditionally and  irrevocably guarantees as a primary obligor and not merely as a surety the full and prompt  payment when due, whether upon maturity, acceleration, or otherwise, of all of the  Guarantied Obligations, and (ii)] unconditionally grants, assigns, and pledges to Agent, for the  benefit of the Lender Group, to secure the Secured Obligations, a continuing security interest in  and to all of such New Grantor's right, title and interest in and to the Collateral.  Each reference to  a "Grantor" [or "Guarantor"] in the Guaranty and Security Agreement shall be deemed to include  each New Grantor.  The Guaranty and Security Agreement is incorporated herein by reference.  2. Schedule 1, "Commercial Tort Claims", Schedule 2, "Copyrights", Schedule 3,  "Intellectual Property Licenses", Schedule 4, "Patents", Schedule 5, "Pledged Companies",  Schedule 6, "Trademarks", Schedule 7, Name; Chief Executive Office; Tax Identification  Numbers and Organizational Numbers, Schedule 8, "Owned Real Property", Schedule 9, "Deposit  Accounts and Securities Accounts", Schedule 10, "Controlled Account Banks", Schedule 11, "List  of Uniform Commercial Code Filing Jurisdictions", and Schedule 12, "Titled Collateral" attached  hereto supplement Schedule 1, Schedule 2, Schedule 3, Schedule 4, Schedule 5, Schedule 6,  Schedule 7, Schedule 8, Schedule 9, Schedule 10, Schedule 11, and Schedule 12 respectively, to  the Guaranty and Security Agreement and shall be deemed a part thereof for all purposes of the  Guaranty and Security Agreement.  3. Each New Grantor authorizes Agent at any time and from time to time to file,  transmit, or communicate, as applicable, financing statements and amendments thereto  (a) describing the Collateral as "all personal property of debtor" or "all assets of debtor" or words  of similar effect, (b) describing the Collateral as being of equal or lesser scope or with greater  detail, or (c) that contain any information required by part 5 of Article 9 of the Code for the  sufficiency or filing office acceptance.  Each New Grantor also hereby ratifies any and all financing  statements or amendments previously filed by Agent in any jurisdiction in connection with the  Loan Documents.  





 






  Annex I - 3      122895846v5  4. Each New Grantor represents and warrants to Agent and the Lender Group that this  Joinder has been duly executed and delivered by such New Grantor and constitutes its legal, valid,  and binding obligation, enforceable against it in accordance with its terms, except as enforceability  thereof may be limited by bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium,  or other similar laws affecting creditors' rights generally and general principles of equity  (regardless of whether such enforceability is considered in a proceeding at law or in equity).  5. This Joinder is a Loan Document.  This Joinder may be executed in any number of  counterparts and by different parties on separate counterparts, each of which, when executed and  delivered, shall be deemed to be an original, and all of which, when taken together, shall constitute  but one and the same Joinder.  Delivery of an executed counterpart of this Joinder by telefacsimile  or other electronic method of transmission shall be equally as effective as delivery of an original  executed counterpart of this Joinder.  Any party delivering an executed counterpart of this Joinder  by telefacsimile or other electronic method of transmission also shall deliver an original executed  counterpart of this Joinder but the failure to deliver an original executed counterpart shall not affect  the validity, enforceability, and binding effect of this Joinder.  6. The Guaranty and Security Agreement, as supplemented hereby, shall remain in  full force and effect.  7. THIS JOINDER SHALL BE SUBJECT TO THE PROVISIONS REGARDING  CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE  SET FORTH IN SECTION 25 OF THE GUARANTY AND SECURITY AGREEMENT, AND  SUCH PROVISIONS ARE INCORPORATED HEREIN BY THIS REFERENCE, MUTATIS  MUTANDIS.    [Signature pages follow]  





 






  [SIGNATURE PAGE TO JOINDER NO. ___ TO GUARANTY AND SECURITY AGREEMENT]    122895846v5  IN WITNESS WHEREOF, the parties hereto have caused this Joinder to the Guaranty and  Security Agreement to be executed and delivered as of the day and year first above written.  NEW GRANTORS: [NAME OF NEW GRANTOR]      By: ____________________________________   Name: _________________________________   Title: __________________________________     [NAME OF NEW GRANTOR]      By: ____________________________________   Name: _________________________________   Title: __________________________________     AGENT: MGG INVESTMENT GROUP LP, a Delaware  limited partnership,     By:  MGG GP LLC, its general partner      By: ____________________________________   Name: _________________________________    Its Authorized Signatory    





 






      122895846v5  EXHIBIT A  COPYRIGHT SECURITY AGREEMENT    This COPYRIGHT SECURITY AGREEMENT (this "Copyright Security Agreement") is  made this ___ day of ___________, 20__, by and among Grantors listed on the signature pages  hereof (collectively, jointly and severally, "Grantors" and each individually "Grantor"), and MGG  INVESTMENT GROUP LP, a Delaware limited partnership ("MGG"), in its capacity as  administrative agent for each member of the Lender Group (in such capacity, together with its  successors and assigns in such capacity, "Agent").  W I T N E S S E T H:  WHEREAS, pursuant to that certain Credit Agreement dated as of April 26, 2021 (as  amended, restated, supplemented, or otherwise modified from time to time, the "Credit  Agreement"), by and among FARMER BROS. CO., a Delaware corporation ("Parent"), and the  Subsidiaries of Parent from time to time party to the Credit Agreement as borrowers in accordance  with the terms thereof (collectively with Parent, each a "Borrower" and individually and  collectively, jointly and severally, the "Borrowers"), the lenders party thereto as "Lenders" (each  of such Lenders, together with its successors and permitted assigns, is referred to hereinafter as a  "Lender"), the Lender Group has agreed to make certain financial accommodations available to  Borrowers from time to time pursuant to the terms and conditions thereof;  WHEREAS, the members of the Lender Group are willing to make the financial  accommodations to Borrowers as provided for in the Credit Agreement, the other Loan  Documents, but only upon the condition, among others, that Grantors shall have executed and  delivered to Agent, for the benefit of the Lender Group, that certain Guaranty and Security  Agreement, dated as of April 26, 2021 (including all annexes, exhibits or schedules thereto, as  from time to time amended, restated, supplemented or otherwise modified, the "Guaranty and  Security Agreement"); and  WHEREAS, pursuant to the Guaranty and Security Agreement, Grantors are required to  execute and deliver to Agent, for the benefit of the Lender Group, this Copyright Security  Agreement.  NOW, THEREFORE, in consideration of the premises and mutual covenants herein  contained and for other good and valuable consideration, the receipt and sufficiency of which are  hereby acknowledged, Grantors hereby agree as follows:  1. DEFINED TERMS.  All initially capitalized terms used but not otherwise defined  herein have the meanings given to them in the Guaranty and Security Agreement or, if not defined  therein, in the Credit Agreement, and this Copyright Security Agreement shall be subject to the  rules of construction set forth in Section 1(b) of the Guaranty and Security Agreement, which rules  of construction are incorporated herein by this reference, mutatis mutandis.  2. GRANT OF SECURITY INTEREST IN COPYRIGHT COLLATERAL.  Each  Grantor hereby unconditionally grants, assigns, and pledges to Agent, for the benefit each member  





 






    122895846v5  of the Lender Group, to secure the Secured Obligations, a continuing security interest (referred to  in this Copyright Security Agreement as the "Security Interest") in all of such Grantor's right, title  and interest in and to the following, whether now owned or hereafter acquired or arising  (collectively, the "Copyright Collateral"):  (a) all of such Grantor's Copyrights and Copyright Intellectual Property  Licenses to which it is a party including those referred to on Schedule I;  (b) all renewals or extensions of the foregoing; and  (c) all products and Proceeds of the foregoing, including any claim by such  Grantor against third parties for past, present or future infringement of any Copyright or any  Copyright exclusively licensed under any Intellectual Property License, including the right to  receive damages, or the right to receive license fees, royalties, and other compensation under any  Copyright Intellectual Property License.  3. SECURITY FOR SECURED OBLIGATIONS.  This Copyright Security  Agreement and the Security Interest created hereby secures the payment and performance of the  Secured Obligations, whether now existing or arising hereafter.  Without limiting the generality of  the foregoing, this Copyright Security Agreement secures the payment of all amounts which  constitute part of the Secured Obligations and would be owed by Grantors, or any of them, to  Agent, the other members of the Lender Group or any of them, whether or not they are  unenforceable or not allowable due to the existence of an Insolvency Proceeding involving any  Grantor.  4. SECURITY AGREEMENT.  The Security Interest granted pursuant to this  Copyright Security Agreement is granted in conjunction with the security interests granted to  Agent, for the benefit of the Lender Group, pursuant to the Guaranty and Security Agreement.   Each Grantor hereby acknowledges and affirms that the rights and remedies of Agent with respect  to the Security Interest in the Copyright Collateral made and granted hereby are more fully set  forth in the Guaranty and Security Agreement, the terms and provisions of which are incorporated  by reference herein as if fully set forth herein.  To the extent there is any inconsistency between  this Copyright Security Agreement and the Guaranty and Security Agreement, the Guaranty and  Security Agreement shall control.  5. AUTHORIZATION TO SUPPLEMENT.  Grantors shall give Agent prior written  notice of no less than five Business Days before filing any additional application for registration  of any copyright and prompt notice in writing of any additional copyright registrations granted  therefor after the date hereof. Without limiting Grantors' obligations under this Section, Grantors  hereby authorize Agent unilaterally to modify this Copyright Security Agreement by amending  Schedule I to include any future United States registered copyrights or applications therefor of  each Grantor.  Notwithstanding the foregoing, no failure to so modify this Copyright Security  Agreement or amend Schedule I shall in any way affect, invalidate or detract from Agent's  continuing security interest in all Collateral, whether or not listed on Schedule I.  6. COUNTERPARTS.  This Copyright Security Agreement is a Loan Document.   This Copyright Security Agreement may be executed in any number of counterparts and by  





 






    122895846v5  different parties on separate counterparts, each of which, when executed and delivered, shall be  deemed to be an original, and all of which, when taken together, shall constitute but one and the  same Copyright Security Agreement.  Delivery of an executed counterpart of this Copyright  Security Agreement by telefacsimile or other electronic method of transmission shall be equally  as effective as delivery of an original executed counterpart of this Copyright Security Agreement.   Any party delivering an executed counterpart of this Copyright Security Agreement by  telefacsimile or other electronic method of transmission also shall deliver an original executed  counterpart of this Copyright Security Agreement but the failure to deliver an original executed  counterpart shall not affect the validity, enforceability, and binding effect of this Copyright  Security Agreement.  7. CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL  REFERENCE PROVISION.  THIS COPYRIGHT SECURITY AGREEMENT SHALL BE  SUBJECT TO THE PROVISIONS REGARDING CHOICE OF LAW AND VENUE, JURY  TRIAL WAIVER, AND JUDICIAL REFERENCE SET FORTH IN SECTION 25 OF THE  GUARANTY AND SECURITY AGREEMENT, AND SUCH PROVISIONS ARE  INCORPORATED HEREIN BY THIS REFERENCE, MUTATIS MUTANDIS.    [signature page follows]  





 






  Signature Page to Copyright Security Agreement    122895846v5  IN WITNESS WHEREOF, the parties hereto have caused this Copyright Security  Agreement to be executed and delivered as of the day and year first above written.    GRANTORS: [NAME OF GRANTOR]      By: ____________________________________   Name: _________________________________   Title: __________________________________     [NAME OF GRANTOR]      By: ____________________________________   Name: _________________________________   Title: __________________________________      ACCEPTED AND ACKNOWLEDGED BY:  AGENT: MGG INVESTMENT GROUP LP    By:  MGG GP LLC, its general partner      By: ____________________________________   Name: _________________________________    Its Authorized Signatory    





 






      122895846v5  SCHEDULE I  to  COPYRIGHT SECURITY AGREEMENT  Copyright Registrations  Grantor Country Copyright Registration No. Registration Date                                                    Copyright Licenses    





 






        122895846v5  EXHIBIT B  PATENT SECURITY AGREEMENT    This PATENT SECURITY AGREEMENT (this "Patent Security Agreement") is made  this ___ day of ___________, 20__, by and among the Grantors listed on the signature pages  hereof (collectively, jointly and severally, "Grantors" and each individually "Grantor"), and MGG  INVESTMENT GROUP LP, a Delaware limited partnership ("MGG"), in its capacity as  administrative agent for each member of the Lender Group (in such capacity, together with its  successors and assigns in such capacity,  "Agent").  W I T N E S S E T H:  WHEREAS, pursuant to that certain Credit Agreement dated as of April 26, 2021 (as  amended, restated, supplemented, or otherwise modified from time to time, the "Credit  Agreement"), by and among FARMER BROS. CO., a Delaware corporation ("Parent"), and the  Subsidiaries of Parent from time to time party to the Credit Agreement as borrowers in accordance  with the terms thereof (collectively with Parent, each a "Borrower" and individually and  collectively, jointly and severally, the "Borrowers"), the lenders party thereto as "Lenders" (each  of such Lenders, together with its successors and permitted assigns, is referred to hereinafter as a  "Lender"), the Lender Group has agreed to make certain financial accommodations available to  Borrowers from time to time pursuant to the terms and conditions thereof;  WHEREAS, the members of the Lender Group are willing to make the financial  accommodations to Borrowers as provided for in the Credit Agreement and the other Loan  Documents, but only upon the condition, among others, that the Grantors shall have executed and  delivered to Agent, for the benefit of the Lender Group, that certain Guaranty and Security  Agreement, dated as of April 26, 2021 (including all annexes, exhibits or schedules thereto, as  from time to time amended, restated, supplemented or otherwise modified, the "Guaranty and  Security Agreement"); and  WHEREAS, pursuant to the Guaranty and Security Agreement, Grantors are required to  execute and deliver to Agent, for the benefit of the Lender Group, this Patent Security Agreement.  NOW, THEREFORE, in consideration of the premises and mutual covenants herein  contained and for other good and valuable consideration, the receipt and sufficiency of which are  hereby acknowledged, each Grantor hereby agrees as follows:  1. DEFINED TERMS.  All initially capitalized terms used but not otherwise defined  herein have the meanings given to them in the Guaranty and Security Agreement or, if not defined  therein, in the Credit Agreement, and this Patent Security Agreement shall be subject to the rules  of construction set forth in Section 1(b) of the Guaranty and Security Agreement, which rules of  construction are incorporated herein by this reference, mutatis mutandis.  2. GRANT OF SECURITY INTEREST IN PATENT COLLATERAL. Each Grantor  hereby unconditionally grants, assigns, and pledges to Agent, for the benefit each member of the  





 






  -2-  122895846v4    122895846v5  Lender Group, to secure the Secured Obligations, a continuing security interest (referred to in this  Patent Security Agreement as the "Security Interest") in all of such Grantor's right, title and interest  in and to the following, whether now owned or hereafter acquired or arising (collectively, the  "Patent Collateral"):  (a) all of its Patents and Patent Intellectual Property Licenses to which it is a  party including those referred to on Schedule I;  (b) all divisionals, continuations, continuations-in-part, reissues,  reexaminations, or extensions of the foregoing; and  (c) all products and Proceeds of the foregoing, including any claim by such  Grantor against third parties for past, present or future infringement of any Patent or any Patent  exclusively licensed under any Intellectual Property License, including the right to receive  damages, or right to receive license fees, royalties, and other compensation under any Patent  Intellectual Property License.  3. SECURITY FOR SECURED OBLIGATIONS.  This Patent Security Agreement  and the Security Interest created hereby secures the payment and performance of the Secured  Obligations, whether now existing or arising hereafter.  Without limiting the generality of the  foregoing, this Patent Security Agreement secures the payment of all amounts which constitute  part of the Secured Obligations and would be owed by Grantors, or any of them, to Agent or the  other members of the Lender Group, whether or not they are unenforceable or not allowable due  to the existence of an Insolvency Proceeding involving any Grantor.  4. SECURITY AGREEMENT.  The Security Interest granted pursuant to this Patent  Security Agreement is granted in conjunction with the security interests granted to Agent, for the  benefit of the Lender Group, pursuant to the Guaranty and Security Agreement.  Each Grantor  hereby acknowledges and affirms that the rights and remedies of Agent with respect to the Security  Interest in the Patent Collateral made and granted hereby are more fully set forth in the Guaranty  and Security Agreement, the terms and provisions of which are incorporated by reference herein  as if fully set forth herein.  To the extent there is any inconsistency between this Patent Security  Agreement and the Guaranty and Security Agreement, the Guaranty and Security Agreement shall  control.  5. AUTHORIZATION TO SUPPLEMENT.  If any Grantor shall obtain rights to any  new patent application or issued patent or become entitled to the benefit of any patent application  or patent for any divisional, continuation, continuation-in-part, reissue, or reexamination of any  existing patent or patent application, the provisions of this Patent Security Agreement shall  automatically apply thereto. Grantors shall give prompt notice in writing to Agent with respect to  any such new patent rights.  Without limiting Grantors' obligations under this Section, Grantors  hereby authorize Agent unilaterally to modify this Patent Security Agreement by amending  Schedule I to include any such new patent rights of each Grantor.  Notwithstanding the foregoing,  no failure to so modify this Patent Security Agreement or amend Schedule I shall in any way affect,  invalidate or detract from Agent's continuing security interest in all Collateral, whether or not listed  on Schedule I.  





 






  -3-  122895846v4    122895846v5  6. COUNTERPARTS.  This Patent Security Agreement is a Loan Document.  This  Patent Security Agreement may be executed in any number of counterparts and by different parties  on separate counterparts, each of which, when executed and delivered, shall be deemed to be an  original, and all of which, when taken together, shall constitute but one and the same Patent  Security Agreement.  Delivery of an executed counterpart of this Patent Security Agreement by  telefacsimile or other electronic method of transmission shall be equally as effective as delivery of  an original executed counterpart of this Patent Security Agreement.  Any party delivering an  executed counterpart of this Patent Security Agreement by telefacsimile or other electronic method  of transmission also shall deliver an original executed counterpart of this Patent Security  Agreement but the failure to deliver an original executed counterpart shall not affect the validity,  enforceability, and binding effect of this Patent Security Agreement.  7. CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL  REFERENCE PROVISION.  THIS PATENT SECURITY AGREEMENT SHALL BE SUBJECT  TO THE PROVISIONS REGARDING CHOICE OF LAW AND VENUE, JURY TRIAL  WAIVER, AND JUDICIAL REFERENCE SET FORTH IN SECTION 25 OF THE GUARANTY  AND SECURITY AGREEMENT, AND SUCH PROVISIONS ARE INCORPORATED  HEREIN BY THIS REFERENCE, MUTATIS MUTANDIS.    [signature page follows]  





 






  Signature Page to Patent Security Agreement  122895846v4    122895846v5  IN WITNESS WHEREOF, the parties hereto have caused this Patent Security Agreement  to be executed and delivered as of the day and year first above written.    GRANTORS: [NAME OF GRANTOR]      By: ____________________________________   Name: _________________________________   Title: __________________________________     [NAME OF GRANTOR]      By: ____________________________________   Name: _________________________________   Title: __________________________________      ACCEPTED AND ACKNOWLEDGED BY:  AGENT: MGG INVESTMENT GROUP LP    By:  MGG GP LLC, its general partner      By: ____________________________________   Name: _________________________________    Its Authorized Signatory    





 






    122895846v4    122895846v5  SCHEDULE I  to  PATENT SECURITY AGREEMENT  Patents  Grantor Country Patent  Application/  Patent No.  Filing Date                                                    Patent Licenses    





 






    122895846v4    122895846v5  EXHIBIT C  PLEDGED INTERESTS ADDENDUM    This Pledged Interests Addendum, dated as of _________ __, 20___ (this "Pledged  Interests Addendum"), is delivered pursuant to Section 7 of the Guaranty and Security Agreement  referred to below.  The undersigned hereby agrees that this Pledged Interests Addendum may be  attached to that certain Guaranty and Security Agreement, dated as of April 26, 2021, (as amended,  restated, supplemented, or otherwise modified from time to time, the "Guaranty and Security  Agreement"), made by the undersigned, together with the other Grantors named therein, to MGG  INVESTMENT GROUP LP, a Delaware limited partnership, as Agent.  Initially capitalized  terms used but not defined herein shall have the meaning ascribed to such terms in the Guaranty  and Security Agreement or, if not defined therein, in the Credit Agreement, and this Pledged  Interests Addendum shall be subject to the rules of construction set forth in Section 1(b) of the  Guaranty and Security Agreement, which rules of construction are incorporated herein by this  reference, mutatis mutandis.  The undersigned hereby agrees that the additional interests listed on  Schedule I shall be and become part of the Pledged Interests pledged by the undersigned to Agent  in the Guaranty and Security Agreement and any pledged company set forth on Schedule I shall  be and become a "Pledged Company" under the Guaranty and Security Agreement, each with the  same force and effect as if originally named therein.  This Pledged Interests Addendum is a Loan Document.  Delivery of an executed  counterpart of this Pledged Interests Addendum by telefacsimile or other electronic method of  transmission shall be equally as effective as delivery of an original executed counterpart of this  Pledged Interests Addendum.  If the undersigned delivers an executed counterpart of this Pledged  Interests Addendum by telefacsimile or other electronic method of transmission, the undersigned  shall also deliver an original executed counterpart of this Pledged Interests Addendum but the  failure to deliver an original executed counterpart shall not affect the validity, enforceability, and  binding effect of this Pledged Interests Addendum.  The undersigned hereby certifies that the representations and warranties set forth in Section  6 of the Guaranty and Security Agreement of the undersigned are true and correct as to the Pledged  Interests listed herein on and as of the date hereof.  THIS PLEDGED INTERESTS ADDENDUM SHALL BE SUBJECT TO THE  PROVISIONS REGARDING CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND  JUDICIAL REFERENCE SET FORTH IN SECTION 25 OF THE GUARANTY AND  SECURITY AGREEMENT, AND SUCH PROVISIONS ARE INCORPORATED HEREIN BY  THIS REFERENCE, MUTATIS MUTANDIS.    [signature page follows]  





 






  -2-  122895846v4    122895846v5  IN WITNESS WHEREOF, the undersigned has caused this Pledged Interests Addendum  to be executed and delivered as of the day and year first above written.    ______________________________      By: ____________________________________   Name: _________________________________   Title: __________________________________     





 






    122895846v4    122895846v5  SCHEDULE I  to  PLEDGED INTERESTS ADDENDUM  Pledged Interests    Name of Grantor  Name of Pledged  Company  Number of  Shares/Units  Class of  Interests  Percentage  of Class  Owned  Certificate  Nos.                         





 






  -1-  122895846v4    122895846v5  EXHIBIT D  TRADEMARK SECURITY AGREEMENT    This TRADEMARK SECURITY AGREEMENT (this "Trademark Security Agreement")  is made this ___ day of ___________, 20__, by and among Grantors listed on the signature pages  hereof (collectively, jointly and severally, "Grantors" and each individually "Grantor"), and MGG  INVESTMENT GROUP LP, a Delaware limited partnership ("MGG"), in its capacity as  administrative agent for each member of the Lender Group (in such capacity, together with its  successors and assigns in such capacity, "Agent").  W I T N E S S E T H:  WHEREAS, pursuant to that certain Credit Agreement dated as of April 26, 2021 (as  amended, restated, supplemented, or otherwise modified from time to time, the "Credit  Agreement"), by and among FARMER BROS. CO., a Delaware corporation ("Parent"), and the  Subsidiaries of Parent from time to time party to the Credit Agreement as borrowers in accordance  with the terms thereof (collectively with Parent, each a "Borrower" and individually and  collectively, jointly and severally, the "Borrowers"), the lenders party thereto as "Lenders" (each  of such Lenders, together with its successors and permitted assigns, is referred to hereinafter as a  "Lender"), the Lender Group has agreed to make certain financial accommodations available to  Borrowers from time to time pursuant to the terms and conditions thereof;  WHEREAS, the members of the Lender Group are willing to make the financial  accommodations to Borrowers as provided for in the Credit Agreement and the other Loan  Documents, but only upon the condition, among others, that Grantors shall have executed and  delivered to Agent, for the benefit of Lender Group, that certain Guaranty and Security Agreement,  dated as of April 26, 2021 (including all annexes, exhibits or schedules thereto, as from time to  time amended, restated, supplemented or otherwise modified, the "Guaranty and Security  Agreement"); and  WHEREAS, pursuant to the Guaranty and Security Agreement, Grantors are required to  execute and deliver to Agent, for the benefit of the Lender Group, this Trademark Security  Agreement.  NOW, THEREFORE, in consideration of the premises and mutual covenants herein  contained and for other good and valuable consideration, the receipt and sufficiency of which are  hereby acknowledged, each Grantor hereby agrees as follows:  1. DEFINED TERMS.  All initially capitalized terms used but not otherwise defined  herein have the meanings given to them in the Guaranty and Security Agreement or, if not defined  therein, in the Credit Agreement, and this Trademark Security Agreement shall be subject to the  rules of construction set forth in Section 1(b) of the Guaranty and Security Agreement, which rules  of construction are incorporated herein by this reference, mutatis mutandis.  





 






  -2-  122895846v4    122895846v5  2. GRANT OF SECURITY INTEREST IN TRADEMARK COLLATERAL.  Each  Grantor hereby unconditionally grants, assigns, and pledges to Agent, for the benefit each member  of the Lender Group, to secure the Secured Obligations, a continuing security interest (referred to  in this Trademark Security Agreement as the "Security Interest") in all of such Grantor's right, title  and interest in and to the following, whether now owned or hereafter acquired or arising  (collectively, the "Trademark Collateral"):  (a) all of its Trademarks and Trademark Intellectual Property Licenses to which  it is a party including those referred to on Schedule I;  (b) all goodwill of the business connected with the use of, and symbolized by,  each Trademark and each Trademark Intellectual Property License; and  (c) all products and Proceeds (as that term is defined in the Code) of the  foregoing, including any claim by such Grantor against third parties for past, present or future  (i) infringement or dilution of any Trademark or any Trademarks exclusively licensed under any  Intellectual Property License, including right to receive any damages, (ii) injury to the goodwill  associated with any Trademark, or (iii) right to receive license fees, royalties, and other  compensation under any Trademark Intellectual Property License.  3. SECURITY FOR SECURED OBLIGATIONS.  This Trademark Security  Agreement and the Security Interest created hereby secures the payment and performance of the  Secured Obligations, whether now existing or arising hereafter.  Without limiting the generality of  the foregoing, this Trademark Security Agreement secures the payment of all amounts which  constitute part of the Secured Obligations and would be owed by Grantors, or any of them, to  Agent or the other members of the Lender Group, whether or not they are unenforceable or not  allowable due to the existence of an Insolvency Proceeding involving any Grantor.  4. SECURITY AGREEMENT.  The Security Interest granted pursuant to this  Trademark Security Agreement is granted in conjunction with the security interests granted to  Agent, for the benefit of the Lender Group, pursuant to the Guaranty and Security Agreement.   Each Grantor hereby acknowledges and affirms that the rights and remedies of Agent with respect  to the Security Interest in the Trademark Collateral made and granted hereby are more fully set  forth in the Guaranty and Security Agreement, the terms and provisions of which are incorporated  by reference herein as if fully set forth herein.  To the extent there is any inconsistency between  this Trademark Security Agreement and the Guaranty and Security Agreement, the Guaranty and  Security Agreement shall control.  5. AUTHORIZATION TO SUPPLEMENT.  If any Grantor shall obtain rights to any  new trademarks, the provisions of this Trademark Security Agreement shall automatically apply  thereto. Grantors shall give prompt notice in writing to Agent with respect to any such new  trademarks or renewal or extension of any trademark registration.   Without limiting Grantors'  obligations under this Section, Grantors hereby authorize Agent unilaterally to modify this  Trademark Security Agreement by amending Schedule I to include any such new trademark rights  of each Grantor.  Notwithstanding the foregoing, no failure to so modify this Trademark Security  





 






  -3-  122895846v4    122895846v5  Agreement or amend Schedule I shall in any way affect, invalidate or detract from Agent's  continuing security interest in all Collateral, whether or not listed on Schedule I.  6. COUNTERPARTS.  This Trademark Security Agreement is a Loan Document.   This Trademark Security Agreement may be executed in any number of counterparts and by  different parties on separate counterparts, each of which, when executed and delivered, shall be  deemed to be an original, and all of which, when taken together, shall constitute but one and the  same Trademark Security Agreement.  Delivery of an executed counterpart of this Trademark  Security Agreement by telefacsimile or other electronic method of transmission shall be equally  as effective as delivery of an original executed counterpart of this Trademark Security Agreement.   Any party delivering an executed counterpart of this Trademark Security Agreement by  telefacsimile or other electronic method of transmission also shall deliver an original executed  counterpart of this Trademark Security Agreement but the failure to deliver an original executed  counterpart shall not affect the validity, enforceability, and binding effect of this Trademark  Security Agreement.  7. CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL  REFERENCE PROVISION.  THIS TRADEMARK SECURITY AGREEMENT SHALL BE  SUBJECT TO THE PROVISIONS REGARDING CHOICE OF LAW AND VENUE, JURY  TRIAL WAIVER, AND JUDICIAL REFERENCE SET FORTH IN SECTION 25 OF THE  GUARANTY AND SECURITY AGREEMENT, AND SUCH PROVISIONS ARE  INCORPORATED HEREIN BY THIS REFERENCE, MUTATIS MUTANDIS.    [signature page follows]  





 






  Signature Page to Trademark Security Agreement  122895846v4    122895846v5  IN WITNESS WHEREOF, the parties hereto have caused this Trademark Security  Agreement to be executed and delivered as of the day and year first above written.    GRANTORS: [NAME OF GRANTOR]      By: ____________________________________   Name: _________________________________   Title: __________________________________     [NAME OF GRANTOR]      By: ____________________________________   Name: _________________________________   Title: __________________________________      ACCEPTED AND ACKNOWLEDGED BY:  AGENT: MGG INVESTMENT GROUP LP    By:  MGG GP LLC, its general partner      By: ____________________________________   Name: _________________________________    Its Authorized Signatory    





 






    122895846v4    122895846v5  SCHEDULE I  to  TRADEMARK SECURITY AGREEMENT    Trademark Registrations/Applications  Grantor Country Mark  Application/  Registration No.  App/Reg Date                                                      Trade Names    Common Law Trademarks    Trademarks Not Currently In Use    Trademark Licenses