IN
RESPECT OF OR IN EXCHANGE FOR ANY OF THE FOREGOING, ALL PRESENT AND FUTURE
RIGHTS TO SUBSCRIBE FOR SECURITIES, SHARES, CAPITAL STOCK, INVESTMENT PROPERTY
OR OTHER OWNERSHIP INTERESTS INCIDENT TO OR ARISING FROM OWNERSHIP OF ANY OF THE
FOREGOING, ALL PRESENT AND FUTURE CASH, INTEREST, STOCK OR
2
OTHER DIVIDENDS OR DISTRIBUTIONS PAID OR PAYABLE ON ANY OF THE FOREGOING, AND
ALL PRESENT AND FUTURE BOOKS AND RECORDS (WHETHER PAPER, ELECTRONIC OR ANY OTHER
MEDIUM) PERTAINING TO ANY OF THE FOREGOING, INCLUDING, WITHOUT LIMITATION, ALL
STOCK RECORD AND TRANSFER BOOKS AND (III) WHATEVER IS RECEIVED WHEN ANY OF THE
FOREGOING IS SOLD, EXCHANGED, REPLACED OR OTHERWISE DISPOSED OF, INCLUDING ALL
PROCEEDS, AS SUCH TERM IS DEFINED IN THE CODE, THEREOF. NOTWITHSTANDING THE
FOREGOING, IN THE EVENT THAT RULE 3-16 OF REGULATION S-X UNDER THE SECURITIES
ACT REQUIRES (OR IS REPLACED WITH ANOTHER RULE OR REGULATION, OR ANY OTHER LAW,
RULE OR REGULATION IS ADOPTED, WHICH WOULD REQUIRE) THE FILING WITH THE SEC OF
SEPARATE FINANCIAL STATEMENTS OF ANY GUARANTOR THAT ARE NOT OTHERWISE REQUIRED
TO BE FILED, THEN THE CAPITAL STOCK OR OTHER SECURITIES OF SUCH GUARANTOR SHALL
AUTOMATICALLY BE DEEMED RELEASED AND NOT TO BE AND NOT TO HAVE BEEN PART OF THE
PLEDGED COLLATERAL BUT ONLY TO THE EXTENT NECESSARY TO NOT BE SUBJECT TO SUCH
REQUIREMENT. IN SUCH EVENT, THIS AGREEMENT MAY BE AMENDED OR MODIFIED, WITHOUT
THE CONSENT OF ANY NOTEHOLDER, TO THE EXTENT NECESSARY TO EVIDENCE THE RELEASE
OF THE LIEN CREATED HEREBY ON THE SHARES OF CAPITAL STOCK OR OTHER SECURITIES
THAT ARE SO DEEMED TO NO LONGER CONSTITUTE PART OF THE PLEDGED COLLATERAL.
(K)
"SECURED OBLIGATIONS" SHALL MEAN AND INCLUDE
ALL NOW EXISTING AND HEREAFTER ARISING SECOND PRIORITY LIEN OBLIGATIONS OF THE
ISSUER AND EACH AND EVERY OTHER PLEDGOR AND GUARANTOR, TOGETHER WITH ANY
EXTENSIONS, RENEWALS, REPLACEMENTS OR REFUNDINGS THEREOF.
(L)
"SECURITY AGREEMENT" SHALL MEAN THE
SECOND LIEN SECURITY AGREEMENT DATED AS OF THE DATE HEREOF AMONG THE ISSUER, HOV
AND CERTAIN OF THEIR RESPECTIVE SUBSIDIARIES AND THE SECURED PARTY, AS AMENDED,
SUPPLEMENTED, AMENDED AND RESTATED OR OTHERWISE MODIFIED FROM TIME TO TIME.
(M)
"SENIOR LENDER CLAIMS" HAS THE MEANING SET
FORTH IN THE INTERCREDITOR AGREEMENT.
2.
GRANT OF SECURITY INTERESTS.
(A)
TO SECURE ON A SECOND PRIORITY PERFECTED
BASIS THE PAYMENT AND PERFORMANCE OF ALL SECURED OBLIGATIONS, IN FULL, EACH
PLEDGOR HEREBY GRANTS TO THE SECURED PARTY A CONTINUING SECOND PRIORITY SECURITY
INTEREST UNDER THE CODE IN AND HEREBY PLEDGES TO SECURED PARTY, IN EACH CASE FOR
ITS BENEFIT AND THE BENEFIT OF THE TRUSTEE AND EACH NOTEHOLDER AND THEIR
RESPECTIVE AFFILIATES, ALL OF SUCH PLEDGOR'S NOW EXISTING AND HEREAFTER ACQUIRED
OR ARISING RIGHT, TITLE AND INTEREST IN, TO, AND UNDER THE PLEDGED COLLATERAL,
WHETHER NOW OR HEREAFTER EXISTING AND WHEREVER LOCATED.
(B)
UPON THE EXECUTION AND DELIVERY OF THIS
AGREEMENT, EACH PLEDGOR SHALL DELIVER TO AND DEPOSIT WITH THE PERFECTION AGENT
(OR WITH A PERSON DESIGNATED BY THE PERFECTION AGENT TO HOLD THE PLEDGED
COLLATERAL ON BEHALF OF THE