INITIAL PLEDGED DEBT CONSTITUTES ALL OF THE OUTSTANDING
INDEBTEDNESS IN EXCESS OF (I) $100,000 INDIVIDUALLY AND (II) $500,000 IN THE
AGGREGATE, OWED TO SUCH GRANTOR BY THE ISSUERS THEREOF EVIDENCED BY A NOTE OR
OTHER INSTRUMENT AND IS OUTSTANDING IN THE PRINCIPAL AMOUNT INDICATED ON
SCHEDULE I HERETO.
7
(H)
SUCH GRANTOR HAS NO DEPOSIT ACCOUNTS TO THE EXTENT THAT THE
AVERAGE DAILY BALANCE, MEASURABLE OVER A 30-DAY TRAILING PERIOD, ON DEPOSIT IN
EACH SUCH DEPOSIT ACCOUNT DOES NOT EXCEED $50,000 OTHER THAN THE COLLATERAL
ACCOUNT, OR PLEDGED DEPOSIT ACCOUNTS LISTED ON SCHEDULE II HERETO OR OPERATED
SOLELY AS A PAYROLL ACCOUNT, ZERO BALANCE ACCOUNT OR TAX WITHHOLDING ACCOUNT AND
ADDITIONAL PLEDGED DEPOSIT ACCOUNTS AS TO WHICH SUCH GRANTOR HAS COMPLIED WITH
THE APPLICABLE REQUIREMENTS OF SECTION 6.
(I)
THIS AGREEMENT CREATES IN FAVOR OF THE COLLATERAL AGENT FOR THE
BENEFIT OF THE SECURED PARTIES A VALID SECOND PRIORITY SECURITY INTEREST, EXCEPT
AS OTHERWISE PROVIDED FOR UNDER THE NOTE DOCUMENTS, IN THE COLLATERAL GRANTED BY
SUCH GRANTOR, SECURING THE PAYMENT OF THE SECURED OBLIGATIONS. EACH GRANTOR HAS
AGREED TO FILE, AND IF IT FAILS TO FILE, HAS AUTHORIZED THE COLLATERAL AGENT TO
FILE FINANCING AND CONTINUATION STATEMENTS ON ITS BEHALF UNDER THE UCC AND
RECORD INTELLECTUAL PROPERTY SECURITY AGREEMENTS REFERRED TO IN SECTION 14(D)
WITH THE U.S. PATENT AND TRADEMARK OFFICE AND THE U.S. COPYRIGHT OFFICE
NECESSARY TO PERFECT A SECOND PRIORITY SECURITY INTEREST IN THE RESPECTIVE
COLLATERAL, AS APPLICABLE, SUBJECT TO CERTAIN EXCEPTIONS CONTAINED HEREIN AND IN
THE INDENTURE.
(J)
NO AUTHORIZATION OR APPROVAL OR OTHER ACTION BY, AND NO NOTICE TO
OR FILING WITH, ANY GOVERNMENTAL AUTHORITY OR REGULATORY BODY IS REQUIRED (OTHER
THAN AS OTHERWISE PROVIDED FOR UNDER THE INDENTURE OR THIS AGREEMENT) FOR
(I) THE GRANT BY SUCH GRANTOR OF THE SECURITY INTEREST GRANTED HEREUNDER OR FOR
THE EXECUTION, DELIVERY OR PERFORMANCE OF THIS AGREEMENT BY SUCH GRANTOR, (II)
THE PERFECTION (TO THE EXTENT REQUIRED HEREUNDER AND EXCLUDING ANY SECURITY
INTEREST IN CASH) OR MAINTENANCE OF THE SECURITY INTEREST CREATED HEREUNDER
(INCLUDING THE SECOND PRIORITY NATURE OF SUCH SECURITY INTEREST), EXCEPT FOR THE
FILING OF FINANCING AND CONTINUATION STATEMENTS UNDER THE UCC, WHICH UPON FILING
OF THE FINANCING STATEMENTS DELIVERED PURSUANT TO SECTION 12.06 OF THE
INDENTURE, HAVE BEEN DULY FILED AND ARE IN FULL FORCE AND EFFECT, UPON THE
RECORDATION OF THE INTELLECTUAL PROPERTY SECURITY AGREEMENTS REFERRED TO IN
SECTION 14(D) WITH THE U.S. PATENT AND TRADEMARK OFFICE AND THE U.S. COPYRIGHT
OFFICE, ANY FILINGS OUTSIDE THE UNITED STATES REQUIRED TO PERFECT A SECURITY
INTEREST IN INTELLECTUAL PROPERTY COLLATERAL, AND, SUBJECT TO SECTION 3 AND THE
INTERCREDITOR AGREEMENT, THE ACTIONS DESCRIBED IN SECTION 5 WITH RESPECT TO THE
SECURITY COLLATERAL, WHICH ACTIONS, UPON FILING OF THE INTELLECTUAL PROPERTY
SECURITY AGREEMENT EXECUTED BY THE COMPANY OR THE GUARANTORS ON THE ISSUE DATE
HAVE BEEN TAKEN AND ARE IN FULL FORCE AND EFFECT, OR (III) THE EXERCISE BY THE
COLLATERAL AGENT OF ITS VOTING OR OTHER RIGHTS PROVIDED FOR IN THIS AGREEMENT OR
THE REMEDIES IN