Document:

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                                                                    Exhibit 10.5

                                                                  EXECUTION COPY

                             PPSA SECURITY AGREEMENT

                            DATED AS OF JULY 30, 2004

                                      AMONG

                THE CREDIT PARTIES FROM TIME TO TIME PARTY HERETO

                                       AND

                            NATIONAL BANK OF CANADA,
                          AS CANADIAN COLLATERAL AGENT

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                                TABLE OF CONTENTS

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                                                                                                              PAGE
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  Section 1.01       Terms Defined in the Finance Documents......................................................2
  Section 1.02       Terms Defined in the PPSA...................................................................2
  Section 1.03       Additional Definitions......................................................................2
  Section 1.04       Terms Generally.............................................................................9
  Section 2.01       Grant of Security Interests.................................................................9
  Section 2.02       Continuing Liability of Each Canadian Credit Party.........................................10
  Section 2.03       Security Interests Absolute................................................................11
  Section 2.04       Segregation of Proceeds; Cash Proceeds Account.............................................12
  Section 2.05       Reinvestment Funds Account.................................................................13
  Section 2.06       LC Cash Collateral Account.................................................................15
  Section 2.07       Investment of Funds in Collateral Accounts.................................................16
  Section 2.08       Leases; Non-Assignable Contracts...........................................................16
  Section 3.01       Title to Collateral........................................................................16
  Section 3.02       Validity, Perfection and Priority of Security Interests....................................17
  Section 3.03       Receivables................................................................................17
  Section 3.04       No Consents................................................................................18
  Section 3.05       Deposit and Securities Accounts............................................................18
  Section 4.01       Delivery of Perfection Certificate; Initial Perfection and Delivery of Search Reports......18
  Section 4.02       Change of Name, Identity, Structure or Location; Subjection to Other Security Agreements...19
  Section 4.03       Further Actions............................................................................19
  Section 4.04       Collateral in Possession of Other Persons, Leased Real Property Locations..................19
  Section 4.05       Books and Records..........................................................................20
  Section 4.06       Delivery of Instruments, Etc...............................................................20
  Section 4.07       Collection and Verification of Receivables.................................................20
  Section 4.08       Notification to Account Debtors............................................................21
  Section 4.09       Disposition of Collateral..................................................................21
  Section 4.10       Insurance..................................................................................21
  Section 4.11       Information Regarding Collateral...........................................................22
  Section 4.12       Covenants Regarding Intellectual Property..................................................22
  Section 4.13       Deposit Accounts and Securities Accounts...................................................24
  Section 4.14       Modification of Assigned Agreements, Etc...................................................25
  Section 5.01       General Authority..........................................................................25
  Section 5.02       Remedies upon Event of Default.............................................................26
  Section 5.03       Limitation on Duty of Canadian Collateral Agent in Respect of Collateral...................29
  Section 5.04       Application of Proceeds....................................................................30
  Section 5.05       Assigned Agreements........................................................................31
  Section 6.01       Concerning the Canadian Collateral Agent...................................................31
  Section 6.02       Appointment of Co-Agent....................................................................32
  Section 7.01       Notices....................................................................................32
  Section 7.02       No Waivers; Non-Exclusive Remedies.........................................................32
  Section 7.03       Compensation and Expenses of the Canadian Collateral Agent; Indemnification................33
  Section 7.04       Enforcement................................................................................35
  Section 7.05       Amendments and Waivers.....................................................................35
  Section 7.06       Successors and Assigns.....................................................................35
  Section 7.07       Governing Law..............................................................................36
  Section 7.08       Limitation of Law; Severability............................................................36
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  <S>                <C>                                                                                        <C>
  Section 7.09       Counterparts; Effectiveness................................................................36
  Section 7.10       Additional Canadian Credit Parties.........................................................36
  Section 7.11       Termination................................................................................37
  Section 7.12       Entire Agreement...........................................................................37
  Section 7.13       Conflict...................................................................................37
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SCHEDULES:

Schedule 3.05   -      Schedule of Deposit Accounts, Individual Stock Accounts
                       and Securities Accounts
Schedule 4.01   -      Schedule of Filings Made to Perfect Security Interests

EXHIBITS:

Exhibit A       -      Form of Deposit Account Control Agreement
Exhibit B       -      Form of Landlord's Waiver and Consent

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                PPSA SECURITY AGREEMENT dated as of July 30, 2004 (as amended,
        modified or supplemented from time to time, this "AGREEMENT") among the
        Canadian Credit Parties from time to time party hereto and National Bank
        of Canada, as Canadian Collateral Agent for the benefit of the Finance
        Parties referred to herein.

        THE JEAN COUTU GROUP (PJC) INC., a company formed and existing under the
laws of the Province of Quebec (together with its successors and permitted
assigns, the "PARENT BORROWER"), proposes to enter into a Credit Agreement dated
as of July 30, 2004 (as amended, restated, modified or supplemented from time to
time and including any agreement extending the maturity of, refinancing or
otherwise restructuring all or any portion of the obligations of the Parent
Borrower under such agreement or any successor agreement, the "CREDIT
AGREEMENT") among the Parent Borrower, THE JEAN COUTU GROUP (PJC) USA, INC., a
corporation formed and existing under the laws of the State of Delaware (the
"U.S. BORROWER") and, together with the Parent Borrower, the "BORROWERS"), the
banks and other financial institutions from time to time party thereto (the
"LENDERS"), MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, as Global
Transaction Coordinator, DEUTSCHE BANK SECURITIES INC., MERRILL LYNCH, PIERCE,
FENNER & SMITH INCORPORATED and NATIONAL BANK FINANCIAL INC., as U.S. Joint Lead
Arrangers, DEUTSCHE BANK SECURITIES INC. and MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED, as U.S. Joint Bookrunners, NATIONAL BANK FINANCIAL INC.,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and DEUTSCHE BANK SECURITIES
INC., as Canadian Joint Lead Arrangers and as Canadian Joint Bookrunners,
NATIONAL BANK OF CANADA, as the Canadian Administrative Agent, DEUTSCHE BANK
TRUST COMPANY AMERICAS, as the Term B Administrative Agent, MERRILL LYNCH,
PIERCE, FENNER & SMITH INCORPORATED and NATIONAL BANK OF CANADA, as U.S.
Co-Syndication Agents, MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and
DEUTSCHE BANK SECURITIES INC., as Canadian Co-Syndication Agents.

        Certain Lenders and their affiliates acting as Derivatives Creditors (as
defined in the Credit Agreement) may from time to time provide forward rate
agreements, options, swaps, caps, floors and other Derivatives Agreements (as
defined in the Credit Agreement) to the Credit Parties. The Lenders, each
Issuing Lender, each Swingline Lender, the Administrative Agents, the
Co-Syndication Agents, the Global Transaction Coordinator, the U.S. Joint Lead
Arrangers, the Canadian Joint Lead Arrangers, the U.S. Collateral Agent, the
Canadian Collateral Agent, as collateral agent for the benefit of the Lenders
(together with its successor or successors in such capacity, the "CANADIAN
COLLATERAL AGENT"), each Indemnitee and each Derivatives Creditor and their
respective successors and assigns are herein referred to individually as a
"FINANCE PARTY" and collectively as the "FINANCE PARTIES".

        To induce the Lenders to enter into the Credit Agreement and the other
Senior Finance Documents (as defined in the Credit Agreement) and the
Derivatives Creditors to enter into the Derivatives Agreements constituting
Finance Documents under the Credit Agreement (collectively with the Senior
Finance Documents and the Derivatives Agreements evidencing Derivatives
Obligations (as hereinafter defined) permitted under the Credit Agreement, the
"FINANCE DOCUMENTS"), and as a condition precedent to the obligations of the
Finance Parties thereunder, the Parent Borrower and certain of its subsidiaries
(each a "GUARANTOR" and, collectively, the "GUARANTORS") have agreed, jointly
and severally, to provide a guaranty of all obligations of the Borrowers and the
other Credit Parties under or in respect of the Finance Documents.

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        As a further condition precedent to the obligations of the Lenders and
the Derivatives Creditors under the Senior Finance Documents, the Parent
Borrower and each Canadian Subsidiary Guarantor (each a "CANADIAN CREDIT PARTY"
and, together with each other person that becomes a party hereto pursuant to
Section 7.10 hereof and the respective successors and permitted assigns of each
of the foregoing, the "CANADIAN CREDIT PARTIES") has agreed or will agree to
grant a continuing security interest in favor of the Canadian Collateral Agent
in and to the Collateral (as hereinafter defined) to secure the Finance
Obligations (as defined in the Credit Agreement). Accordingly, the parties
hereto agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

        SECTION 1.01   TERMS DEFINED IN THE FINANCE DOCUMENTS

        Capitalized terms defined in the Credit Agreement and not otherwise
defined herein have, as used herein, the respective meanings provided for
therein.

        SECTION 1.02   TERMS DEFINED IN THE PPSA

        Unless otherwise defined herein or in the Credit Agreement or the
context otherwise requires, the following terms, together with any uncapitalized
terms used herein which are defined in the PPSA (as defined below), have the
respective meanings provided in the PPSA: (i) Chattel Paper; (ii) Document of
Title; (iii) Goods; (iv) Instrument; (v) Money; (vi) Proceeds and (vii)
Security.

        SECTION 1.03   ADDITIONAL DEFINITIONS

        Terms defined in the introductory section hereof have the respective
meanings set forth therein. The following additional terms, as used herein, have
the following respective meanings:

        "ACCOUNT CONTROL AGREEMENT" means (i) with respect to a Deposit Account,
a deposit account control agreement, substantially in the form of EXHIBIT A
hereto or otherwise containing similar terms and reasonably acceptable in form
and substance to the Canadian Collateral Agent, among one or more Canadian
Credit Parties, the Canadian Collateral Agent and the Financial Intermediary
which maintains such Deposit Account and (ii) with respect to a Securities
Account, a securities account control agreement, substantially in the form of
EXHIBIT A to the Pledge Agreement or otherwise containing similar terms and
reasonably acceptable in form and substance to the Canadian Collateral Agent,
among one or more Canadian Credit Parties, the Canadian Collateral Agent and the
Financial Intermediary which maintains such Securities Account, in each case as
the same may be amended, restated, modified or supplemented from time to time.

        "ASSIGNED AGREEMENTS" means with respect to each Canadian Credit Party
those contracts and agreements of such Canadian Credit Party identified in or
pursuant to Section VI of such Canadian Credit Party's Perfection Certificate,
as the same may be amended, modified or supplemented from time to time, and all
supporting obligations of any kind given by any Person with respect to all or
any of the foregoing.

        "CANADIAN SUBSIDIARY GUARANTOR" means each Subsidiary of the Parent
Borrower existing on the Closing Date (other than a U.S. Subsidiary Guarantor or
a Foreign Subsidiary) and each Subsidiary

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of the Parent Borrower (other than a U.S. Subsidiary Guarantor or a Foreign
Subsidiary, except to the extent otherwise provided in Section 6.10 of the
Credit Agreement) that becomes a party to a Guaranty guaranteeing the
obligations of the Borrowers after the Closing Date (by execution of an
Accession Agreement referring to such Guaranty or otherwise), and "Canadian
Subsidiary Guarantors" means any two or more of them.

        "CASH PROCEEDS ACCOUNT" has the meaning set forth in Section 2.04(a) of
this Agreement.

        "COLLATERAL" has the meaning set forth in Section 2.01 of this
Agreement.

        "COLLATERAL ACCOUNTS" means one or more of the Cash Proceeds Account,
the LC Cash Collateral Account, the Reinvestment Funds Account and any other
Securities Accounts or Deposit Accounts established with or in the possession or
under the control of the Canadian Collateral Agent (including Individual Store
Accounts) into which cash or cash Proceeds (including cash Proceeds of insurance
policies, awards of condemnation or other compensation) of any Collateral are
deposited from time to time, collectively.

        "COMPUTER HARDWARE" means all computer and other electronic data
processing hardware of a Canadian Credit Party, whether now or hereafter owned,
licensed or leased by such Canadian Credit Party, including, without limitation,
all integrated computer systems, central processing units, memory units, display
terminals, printers, features, computer elements, card readers, tape drives,
hard and soft disk drives, cables, electrical supply hardware, generators, power
equalizers, accessories, peripheral devices and other related computer hardware,
all documentation, flowcharts, logic diagrams, manuals, specifications, training
materials, charts and pseudo codes associated with any of the foregoing and all
options, warranties, services contracts, program services, test rights,
maintenance rights, support rights, renewal rights and indemnifications relating
to any of the foregoing.

        "COPYRIGHT" means any of the following, whether now existing or
hereafter arising, created or acquired:

                (i)    the Canadian and foreign copyrights described on
     SCHEDULE V to any Canadian Credit Party's Perfection Certificate (as each
     such schedule may be amended, modified or supplemented from time to time)
     and any renewals thereof;

                (ii)   all other common law and/or statutory rights in all
     copyrightable subject matter under the Laws of Canada or any other country
     (whether or not the underlying works of authorship have been published);

                (iii)  all registrations and applications for registration of
     any such copyright in Canada or any other country, including registrations,
     recordings, supplemental, derivative or collective work registrations and
     pending applications for registrations in the Copyright Office of the
     Canadian Intellectual Property Office or any other country;

                (iv)   all computer programs, web pages, computer data bases and
     computer program flow diagrams, including all source codes and object codes
     related to any or all of the foregoing;

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                (v)    all tangible property embodying or incorporating any or
     all of the foregoing, whether in completed form or in some lesser state of
     completion, and all masters, duplicates, drafts, versions, variations and
     copies thereof, in all formats;

                (vi)   all claims for, and rights to sue for, past, present and
     future infringement of any of the foregoing;

                (vii)  all income, royalties, damages and payments now or
     hereafter due or payable with respect to any of the foregoing, including,
     without limitation, damages and payments for past, present or future
     infringements thereof and payments and damages under all Copyright Licenses
     in connection therewith;

                (viii) all rights in any of the foregoing, whether arising under
     the Laws of Canadian or any foreign country or otherwise, to copy, record,
     synchronize, broadcast, transmit, perform and/or display any of the
     foregoing or any matter which is the subject of any of the foregoing in any
     manner and by any process now known or hereafter devised; and

                (ix)   the name and title of each Copyright item and all rights
     of any Canadian Credit Party to the use thereof, including, without
     limitation, rights protected pursuant to trademark, service mark, unfair
     competition, anti-cybersquatting and/or the rules and principles of any
     other applicable statute, common law or other rule or principle of law now
     existing or hereafter arising.

        "COPYRIGHT LICENSE" means any agreement now or hereafter in existence
granting to any Canadian Credit Party any rights, whether exclusive or
non-exclusive, to use another Person's copyrights or copyright applications, or
pursuant to which any Canadian Credit Party has granted to any other Person, any
right, whether exclusive or non-exclusive, with respect to any Copyright,
whether or not registered, including, without limitation, the Copyright Licenses
described on SCHEDULE V to any Canadian Credit Party's Perfection Certificate
(as each such schedule may be amended, modified or supplemented from time to
time).

        "DEPOSIT ACCOUNTS" means all demand, time, savings, passbook or similar
accounts maintained by a Canadian Credit Party with a Financial Intermediary,
whether or not evidenced by an Instrument, all cash and other funds held therein
and all passbooks related thereto and all certificates and Instruments, if any,
from time to time representing, evidencing or deposited into such deposit
accounts.

        "DERIVATIVES OBLIGATIONS" of any Person means all obligations
(including, without limitation, any amounts which accrue after the commencement
of any bankruptcy or insolvency proceeding with respect to such Person, whether
or not allowed or allowable as a claim under any bankruptcy or insolvency
proceeding) of such Person in respect of any Derivatives Agreement, excluding
any amounts which such Person is entitled to set-off against its obligations
under applicable Law.

        "DIRECT EXPOSURE" has the meaning set forth in Section 2.06 of this
Agreement.

        "EQUIPMENT" has the meaning set forth in Section 2.01 of this Agreement.

        "EXEMPT DEPOSIT ACCOUNTS" means Deposit Accounts the balance of which
consists exclusively of (i) withheld income taxes, federal, provincial or local
employment taxes in such amounts

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as are required in the reasonable judgment of the Parent Borrower to be paid to
the federal, provincial or local government authorities within the following two
months with respect to employees of any of the Credit Parties or (ii) amounts
required to be paid over to the Canada Pension Plan, Regie des rentes du Quebec
or under the EMPLOYMENT INSURANCE ACT (Canada)

        "FINANCE OBLIGATIONS" means:

                (i)    all Senior Obligations and

                (ii)   all Derivatives Obligations permitted under the Credit
     Agreement owed or owing to any Derivatives Creditor,

in each case whether now or hereafter due, owing or incurred in any manner,
whether actual or contingent, whether incurred solely or jointly with any other
Person and whether as principal or surety (and including all liabilities in
connection with any notes, bills or other instruments accepted by any Finance
Party in connection therewith), together in each case with all renewals,
modifications, consolidations or extensions thereof.

        "FINANCIAL INTERMEDIARY" means a Person, including a bank, other
financial institution or broker, that in the ordinary course of its business
maintains banks accounts or Securities Accounts for others.

        "INDIVIDUAL STORE ACCOUNTS" means Deposit Accounts, the balance of which
consists exclusively of a single retail store's receipts that is in the ordinary
course of the business swept daily into a concentration account.

        "INTELLECTUAL PROPERTY" means all Patents, Trademarks, Copyrights,
Software, Licenses, rights in intellectual property, goodwill, trade names,
service marks, trade secrets, confidential or proprietary technical and business
information, know-how, show-how, domain names, mask works, customer lists,
vendor lists, subscription lists, data bases and related documentation,
registrations, franchises and all other intellectual or other similar property
rights.

        "INVENTORY" has the meaning set forth in Section 2.01 of this Agreement.

        "LICENSE" means any Patent License, Trademark License, Copyright
License, Software License or other license or sublicense as to which any
Canadian Credit Party is a party.

        "LIQUID INVESTMENTS" has the meaning set forth in Section 2.07 of this
Agreement.

        "LC CASH COLLATERAL ACCOUNT" has the meaning set forth in Section 2.06
of this Agreement.

        "MATERIAL REAL PROPERTY" has the meaning given to it in the Credit
Agreement.

        "PATENT" means any of the following:

                (i)    the Canadian and foreign patents described on SCHEDULE V
     to any Canadian Credit Party's Perfection Certificate (as each such
     schedule may be amended, modified or supplemented from time to time) and
     any renewals thereof;

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                (ii)   all other letters patent and design letters patent of
     Canada or any other country;

                (iii)  all applications filed or in preparation for filing for
     letters patent and design letters patent in Canada or any other country
     including, without limitation, applications in the Patent Branch of the
     Canadian Intellectual Property Office or in any similar office or agency of
     Canada or any other country or political subdivision thereof;

                (iv)   all reissues, divisions, continuations,
     continuations-in-part, revisions, renewals or extensions thereof;

                (v)    all claims for, and rights to sue for, past, present or
     future infringement of any of the foregoing;

                (vi)   all income, royalties, damages and payments now or
     hereafter due or payable with respect to any of the foregoing, including,
     without limitation, damages and payments for past, present or future
     infringements thereof and payments and damages under all Patent Licenses in
     connection therewith; and

                (vii)  all rights corresponding to any of the foregoing whether
     arising under the Laws of Canada or any foreign country or otherwise.

        "PATENT LICENSE" means any agreement now or hereafter in existence
granting to any Canadian Credit Party any right, whether exclusive or
non-exclusive, with respect to any Person's patent or any invention now or
hereafter in existence, whether or not patentable, or pursuant to which any
Canadian Credit Party has granted to any other Person, any right, whether
exclusive or non-exclusive, with respect to any Patent or any invention now or
hereafter in existence, whether or not patentable and whether or not a Patent or
application for Patent is in or hereafter comes into existence on such
invention, including, without limitation, the Patent Licenses described on
SCHEDULE V to any Canadian Credit Party's Perfection Certificate (as each such
schedule may be amended, modified or supplemented from time to time).

        "PERFECTION CERTIFICATE" means with respect to each Canadian Credit
Party a certificate, substantially in the form of EXHIBIT F-1 to the Credit
Agreement, completed and supplemented with the schedules and attachments
contemplated thereby.

        "PERMITTED LIEN" means any Lien referred to in, and permitted by,
Section 7.02 of the Credit Agreement.

        "PPSA" means the PERSONAL PROPERTY SECURITY ACT (Ontario) as now enacted
or as the same may from time to time be amended, re-enacted or replaced.

        "RECEIVABLES" has the meaning set forth in Section 2.01 of this
Agreement.

        "RECORDABLE INTELLECTUAL PROPERTY" means Intellectual Property the
transfer of which is required to be recorded in the Canadian Intellectual
Property Office in order to be effective against subsequent third party
transferees; PROVIDED that the following shall not be considered "RECORDABLE
INTELLECTUAL PROPERTY" hereunder: (i) unregistered Canadian Copyrights and (ii)
non-exclusive Licenses.

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        "REINVESTMENT FUNDS" has the meaning set forth in Section 2.05(a) of
this Agreement.

        "REINVESTMENT FUNDS ACCOUNT" has the meaning set forth in Section
2.05(a) of this Agreement.

        "RELEVANT CONTINGENT EXPOSURE" has the meaning set forth in Section
2.06 of this Agreement.

        "REPURCHASE AGREEMENT" means (a) the Sale and Purchase Agreement which
provides that the Parent Borrower will purchase the Preferred Shares the U.S.
Borrower holds in JCG Holdings (USA), Inc. and will grant to the U.S. Borrower a
non-assignable right to repurchase from the Parent Borrower (subject to the Jean
Coutu Group Holdings (USA), LLC's right of first refusal) such Preferred Shares
in whole or in part, at any time for U.S.$1,486,400,000 and any accrued but
unpaid dividends and (b) the Forward Sale Agreement which provides that the U.S.
Borrower will be required to purchase in 10 years from Closing the Preferred
Shares for U.S.$1,486,400,000 and any accrued but unpaid dividends and any board
of director's resolution and proxy statement incident thereto.

        "SECURITIES ACCOUNT" means an account to which Securities or other
financial assets are or may be credited or debited.

        "SECURITY INTERESTS" means the security interests in the Collateral
granted under this Agreement or any other Collateral Documents.

        "SENIOR OBLIGATIONS" means with respect to each Credit Party, without
duplication:

                (i)    in the case of each Borrower, all principal of and
     interest (including, without limitation, any interest which accrues after
     the commencement of any bankruptcy or insolvency proceeding with respect
     to, whether or not allowed or allowable as a claim under any bankruptcy or
     insolvency proceeding) on any Loan made to or LC Obligation or BA
     Reimbursement Obligation under, or any Note issued, pursuant to the Credit
     Agreement or any other Senior Finance Document;

                (ii)   all fees, expenses, indemnification obligations, foreign
     currency exchange obligations and other amounts of whatever nature now or
     hereafter payable by such Credit Party (including, without limitation, any
     amounts which accrue after the commencement of any bankruptcy or insolvency
     proceeding with respect to such Credit Party, whether or not allowed or
     allowable as a claim under any bankruptcy or insolvency proceeding)
     pursuant to the Credit Agreement, this Agreement or any other Senior
     Finance Document;

                (iii)  all expenses of any Finance Party as to which it has a
     right to reimbursement under Section 7.03(a) or Section 7.03(b) of this
     Agreement or under any other similar provision of any other Senior Finance
     Document, including, without limitation, any and all sums advanced by the
     Canadian Collateral Agent to preserve any Collateral or preserve its
     security interests in any Collateral;

                (iv)   all amounts paid by any Indemnitee as to which such
     Indemnitee has the right to reimbursement under Section 7.03(c) of this
     Agreement, Section 10.05 of the Credit Agreement or under any other similar
     provision of any other Senior Finance Document; and

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                (v)    in the case of each Borrower and each Subsidiary
     Guarantor, all amounts now or hereafter payable by such Borrower or such
     Subsidiary Guarantor and all other obligations or liabilities now existing
     or hereafter arising or incurred (including, without limitation, any
     amounts which accrue after the commencement of any bankruptcy or insolvency
     proceeding with respect to any Credit Party, whether or not allowed or
     allowable as a claim under any bankruptcy or insolvency proceeding) on the
     part of such Borrower or such Subsidiary Guarantor pursuant to the Guaranty
     in respect of the Credit Agreement or any other Senior Finance Document;

in each case whether now or hereafter due, owing or incurred in any manner,
whether actual or contingent, whether incurred solely or jointly with any other
Person and whether as principal or surety (and including all liabilities in
connection with any notes, bills or other instruments accepted by any Finance
Party in connection therewith), together in each case with all renewals,
modifications, consolidations or extensions thereof.

        "SOFTWARE" means all software programs, whether now or hereafter owned,
licensed or leased by a Canadian Credit Party, designed for use on Computer
Hardware, including, without limitation, all operating system software,
utilities and application programs in whatever form and whether or not embedded
in Goods, all source code and object code in magnetic tape, disk or hard copy
format or any other listings whatsoever, all firmware associated with any of the
foregoing all documentation, flowcharts, logic diagrams, manuals,
specifications, training materials, charts and pseudo codes associated with any
of the foregoing, and all options, warranties, services contracts, program
services, test rights, maintenance rights, support rights, renewal rights and
indemnifications relating to any of the foregoing.

        "SOFTWARE LICENSE" means any agreement (including any agreement
constituting a Copyright License, Patent License and/or Trademark License) now
or hereafter in existence granting to any Canadian Credit Party any right,
whether exclusive or non-exclusive, to use another Person's Software, or
pursuant to which any Canadian Credit Party has granted to any other Person, any
right, whether exclusive or non-exclusive, to use any Software, whether or not
subject to any registration.

        "TRADEMARK" means any of the following:

                (i)    the Canadian and foreign trademarks described on
     SCHEDULE V to any Canadian Credit Party's Perfection Certificate (as each
     such schedule may be amended, modified or supplemented from time to time)
     and any renewals thereof;

                (ii)   all other trademarks, trade names, corporate names,
     company names, business names, fictitious business names, trade styles,
     service marks, logos, certification marks, collective marks, brand names
     and trade dress which are or have been used in Canada or in any province,
     territory or possession thereof, or in any other place, nation or
     jurisdiction, along with all prints and labels on which any of the
     foregoing have appeared or appear, package and other designs, and any other
     source or business identifiers, and general intangibles of like nature, and
     the rights in any of the foregoing which arise under applicable law;

                (iii)  the goodwill of the business symbolized thereby or
     associated with each of the foregoing;

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                (iv)   all registrations and applications in connection
     therewith, including, without limitation, registrations and applications in
     the Trademarks Office of the Canadian Intellectual Property Office or in
     any similar office or agency of Canada, any province or territory thereof
     or any other country or any political subdivision thereof;

                (v)    all reissues, extensions and renewals thereof;

                (vi)   all claims for, and rights to sue for, past, present or
     future infringements of any of the foregoing;

                (vii)  all income, royalties, damages and payments now or
     hereafter due or payable with respect to any of the foregoing, including,
     without limitation, damages and payments for past, present or future
     infringements thereof and payments and damages under all Trademark Licenses
     in connection therewith; and

                (viii) all rights corresponding to any of the foregoing whether
     arising under the Laws of Canada or any foreign country or otherwise.

        "TRADEMARK LICENSE" means any agreement now or hereafter in existence
granting to any Canadian Credit Party any right, whether exclusive or
non-exclusive, to use another Person's trademarks or trademark applications, or
pursuant to which any Canadian Credit Party has granted to any other Person, any
right, whether exclusive or non-exclusive, to use any Trademark, whether or not
registered, including, without limitation, the Trademark Licenses described on
SCHEDULE V to any Canadian Credit Party's Perfection Certificate (as each such
schedule may be amended, modified or supplemented from time to time) and the
rights to prepare for sale, sell and advertise for sale, all of the inventory
now or hereafter owned by any Canadian Credit Party and now or hereafter covered
by such license agreements.

        SECTION 1.04   TERMS GENERALLY

        The definitions in Section 1.02 and Section 1.03 shall apply equally to
both the singular and plural forms of the terms defined. Whenever the context
may require, any pronoun shall include the corresponding masculine, feminine and
neuter forms. The words "include", "includes" and "including" shall be deemed to
be followed by the phrase "without limitation". All references herein to
Articles, Sections, Exhibits and Schedules shall be deemed references to
Articles and Sections of, and Exhibits and Schedules to, this Agreement unless
the context shall otherwise require. Unless otherwise expressly provided herein,
the word "day" means a calendar day.

                                   ARTICLE II
                               SECURITY INTERESTS

        SECTION 2.01   GRANT OF SECURITY INTERESTS

        To secure the due and punctual payment of all Finance Obligations,
howsoever created, arising or evidenced, whether direct or indirect, absolute or
contingent, now or hereafter existing or due or to become due, in accordance
with the terms thereof and to secure the performance of all of the obligations
of each Canadian Credit Party hereunder and under the other Finance Documents,
each Canadian Credit Party hereby grants to the Canadian Collateral Agent for
the benefit of the Finance Parties a security interest in, and each Canadian
Credit Party hereby pledges and collaterally assigns to

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the Canadian Collateral Agent for the benefit of the Finance Parties, all of
such Canadian Credit Party's right, title and interest in and to all now owned
or held and after acquired or held personal property, assets and undertakings,
of whatever nature or kind and wheresoever situated, and all Proceeds thereof
and therefrom (all of which is hereinafter collectively called the "COLLATERAL")
including, without limiting the generality of the foregoing:

                (i)    all equipment, including, without limiting the generality
     of the foregoing, machinery, tools, fixtures, furniture, furnishings,
     chattels, motor vehicles, vessels and other tangible personal property that
     is not Inventory, and all parts, components, attachments, accessories,
     accessions, replacements, substitutions, additions and improvements to any
     of the foregoing (all of which is collectively called the "EQUIPMENT");

                (ii)   all inventory, including, without limiting the generally
     of the foregoing, Goods acquired or held for sale or lease or furnished or
     to be furnished under contracts of rental or service, all raw materials,
     work in process, finished Goods, returned Goods, repossessed Goods, and all
     packaging materials, supplies and containers relating to or used or
     consumed in connection with any of the foregoing (all of which is
     collectively called the "INVENTORY");

                (iii)  all debts, accounts, claims, demands, Money and choses in
     action which now are, or which may at any time hereafter be, due, owing to
     or accruing due to the Canadian Credit Party (all of which is collectively
     called the "RECEIVABLES");

                (iv)   all Documents of Title, Chattel Paper, Instruments,
     Securities and Money, and all other Goods of the Canadian Credit Party that
     are not Equipment, Inventory or Receivables;

                (v)    all contractual rights, goodwill, Intellectual Property,
     all other choses in action of the Canadian Credit Party of every kind which
     now are, or which may at any time hereafter be, due or owing to or owed by
     the Canadian Credit Party;

                (vi)   all books, records, documents, papers and electronically
     recorded data recordings evidencing or relating to any of the Collateral;

                (vii)  all other intangible property of the Canadian Credit
     Party not otherwise referred to in this Section 2.01; and

                (viii) all Proceeds of any Collateral in any form derived
     directly or indirectly from any dealing with the Collateral or that
     indemnifies or compensates for the loss of a damage to the Collateral.

PROVIDED, HOWEVER that the Collateral shall not include any Exempt Deposit
Accounts.

        SECTION 2.02   CONTINUING LIABILITY OF EACH CANADIAN CREDIT PARTY

        Anything herein to the contrary notwithstanding, each Canadian Credit
Party shall remain liable to observe and perform all the terms and conditions to
be observed and performed by it under any contract, agreement, warranty or other
obligation with respect to the Collateral. Neither the Canadian Collateral Agent
nor any Finance Party shall have any obligation or liability under any such
contract, agreement, warranty or obligation by reason of or arising out of this
Agreement or the receipt by the

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Canadian Collateral Agent or any Finance Party of any payment relating to any
Collateral, nor shall the Canadian Collateral Agent or any Finance Party be
required to perform or fulfill any of the obligations of any Canadian Credit
Party with respect to any of the Collateral, to make any inquiry as to the
nature or sufficiency of any payment received by it or the sufficiency of the
performance of any party's obligations with respect to any Collateral.
Furthermore, neither the Canadian Collateral Agent nor any Finance Party shall
be required to file any claim or demand to collect any amount due or to enforce
the performance of any party's obligations with respect to the Collateral.

        SECTION 2.03   SECURITY INTERESTS ABSOLUTE

        All rights of the Canadian Collateral Agent, all security interests
hereunder and all obligations of each Canadian Credit Party hereunder are
unconditional and absolute and independent and separate from any other security
for or guaranty of the Finance Obligations, whether executed by such Canadian
Credit Party, any other Credit Party or any other Person. Without limiting the
generality of the foregoing, the obligations of each Canadian Credit Party
hereunder shall not be released, discharged or otherwise affected or impaired
by:

                (i)    any extension, renewal, settlement, compromise,
     acceleration, waiver or release in respect of any obligation of any other
     Credit Party under any Finance Document or any other agreement or
     instrument evidencing or securing any Finance Obligation, by operation of
     law or otherwise;

                (ii)   other than pursuant to Section 7.05 hereof, any change in
     the manner, place, time or terms of payment of any Finance Obligation or
     any other amendment, supplement or modification to any Finance Document or
     any other agreement or instrument evidencing or securing any Finance
     Obligation;

                (iii)  any release, non-perfection or invalidity of any direct
     or indirect security for any Finance Obligation, any sale, exchange,
     surrender, realization upon, offset against or other action in respect of
     any direct or indirect security for any Finance Obligation or any release
     of any other obligor or Credit Parties in respect of any Finance
     Obligation;

                (iv)   any change in the existence, structure or ownership of
     any Credit Party, or any insolvency, bankruptcy, reorganization,
     arrangement, readjustment, composition, liquidation or other similar
     proceeding affecting any Credit Party or its assets or any resulting
     disallowance, release or discharge of all or any portion of any Finance
     Obligation;

                (v)    the existence of any claim, set-off or other right which
     any Credit Party may have at any time against the Borrowers, any other
     Credit Party, any Agent, any other Finance Party or any other Person,
     whether in connection herewith or any unrelated transaction; PROVIDED that
     nothing herein shall prevent the assertion of any such claim by separate
     suit or compulsory counterclaim;

                (vi)   any invalidity or unenforceability relating to or against
     the Borrowers or any other Credit Party for any reason of any Finance
     Document or any other agreement or instrument evidencing or securing any
     Finance Obligation or any provision of applicable Law or regulation
     purporting to prohibit the payment by the Borrowers or any other Credit
     Party of any Finance Obligation;

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                (vii)  any failure by any Finance Party: (A) to file or enforce
     a claim against any Credit Party or its estate (in a bankruptcy or other
     proceeding); (B) to give notice of the existence, creation or incurrence by
     any Credit Party of any new or additional indebtedness or obligation under
     or with respect to the Finance Obligations; (C) to commence any action
     against any Credit Party; (D) to disclose to any Credit Party any facts
     which such Finance Party may now or hereafter know with regard to any
     Credit Party; or (E) to proceed with due diligence in the collection,
     protection or realization upon any collateral securing the Finance
     Obligations;

                (viii) any direction as to application of payment by the
     Borrowers, any other Credit Party or any other Person;

                (ix)   any subordination by any Finance Party of the payment of
     any Finance Obligation to the payment of any other liability (whether
     matured or unmatured) of any Credit Party to its creditors;

                (x)    any act or failure to act by the Canadian Collateral
     Agent or any other Finance Party under this Agreement or otherwise which
     may deprive any Credit Party of any right to subrogation, contribution or
     reimbursement against any other Credit Party or any right to recover full
     indemnity for any payments made by such Credit Party in respect of the
     Finance Obligations; or

                (xi)   any other act or omission to act or delay of any kind by
     any Credit Party or any Finance Party or any other Person or any other
     circumstance whatsoever which might, but for the provisions of this clause,
     constitute a legal or equitable discharge of any Credit Party's obligations
     hereunder.

        Each Canadian Credit Party has irrevocably and unconditionally delivered
this Agreement to the Canadian Collateral Agent, for the benefit of the Finance
Parties, and the failure by any other Person to sign this Agreement or a
security agreement similar to this Agreement or otherwise shall not discharge
the obligations of any Canadian Credit Party hereunder.

        This Agreement shall remain fully enforceable against each Canadian
Credit Party irrespective of any defenses that any other Credit Party may have
or assert in respect of the Finance Obligations, including, without limitation,
failure of consideration, breach of warranty, payment, statute of frauds,
statute of limitations, accord and satisfaction and usury.

        SECTION 2.04   SEGREGATION OF PROCEEDS; CASH PROCEEDS ACCOUNT.

        (a)     CREATION OF CASH PROCEEDS ACCOUNT. There is hereby
established with the Canadian Collateral Agent a collateral account (the "CASH
PROCEEDS ACCOUNT") in the name of "National Bank of Canada, as Canadian
Collateral Agent" and under the exclusive control of the Canadian Collateral
Agent, into which there shall be deposited from time to time the cash Proceeds
of the Collateral required to be delivered to the Canadian Collateral Agent
pursuant to subsection (b) of this Section. Any income received by the Canadian
Collateral Agent with respect to the balance from time to time standing to the
credit of the Cash Proceeds Account, including any interest or capital gains on
Liquid Investments, shall remain, or be deposited, in the Cash Proceeds Account.
All right, title and interest in and to the cash amounts on deposit from time to
time in the Cash Proceeds Account together with any Liquid Investments from time
to time made pursuant to Section 2.07 and any other property or assets from time

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to time deposited in or credited to the Cash Proceeds Account shall vest in and
be under the sole dominion and control of the Canadian Collateral Agent for the
benefit of the Finance Parties, shall constitute part of the Collateral
hereunder and shall not constitute payment of the Finance Obligations until
applied thereto as hereinafter provided.

        (b)     DEPOSITS TO CASH PROCEEDS ACCOUNT. Upon the occurrence and
during the continuance of a Default or an Event of Default, except as otherwise
provided in Section 2.05 and Section 2.06, each Canadian Credit Party, promptly
after receiving written instructions from the Canadian Collateral Agent to do
so, shall instruct all account debtors and other Persons obligated in respect of
its Receivables and other Collateral to make all payments in respect of its
Receivables and other Collateral either (i) directly to the Canadian Collateral
Agent (by instructing that such payments be remitted by direct wire transfer to
the Canadian Collateral Agent at its address referred to in Section 7.01 or to a
post office box which shall be in the name and under the control of the Canadian
Collateral Agent) or (ii) to one or more other banks or financial institutions
in Canada (by instructing that such payments be remitted by direct wire transfer
to, or to a post office box which shall be in the name and under the control of,
such bank or financial institution) under an Account Control Agreement duly
executed by each relevant Canadian Credit Party and such bank or financial
institution or under other arrangements, in form and substance satisfactory to
the Canadian Collateral Agent, pursuant to which each relevant Canadian Credit
Party shall have irrevocably instructed such other bank or financial institution
(and such other bank shall have agreed) to remit all proceeds of such payments
directly to the Canadian Collateral Agent for deposit into the Cash Proceeds
Account or as the Canadian Collateral Agent may otherwise instruct such bank or
financial institution. All such payments made to the Canadian Collateral Agent
shall be deposited in the Cash Proceeds Account. In addition to the foregoing,
each Canadian Credit Party agrees that if the proceeds of any Collateral
hereunder (including the payments made in respect of Receivables) shall be
received by it after the occurrence and during the continuance of a Default or
an Event of Default and receipt of the Canadian Collateral Agent's written
instructions pursuant to the first sentence of this clause (b), such Canadian
Credit Party shall as promptly as possible deposit such Proceeds into the Cash
Proceeds Account. Until so deposited, all such proceeds shall be held in trust
by the relevant Canadian Credit Party for and as the property of the Canadian
Collateral Agent for the benefit of the Finance Parties and shall not be
commingled with any other funds or property of any Canadian Credit Party;
PROVIDED, however, that until a Default or an Event of Default shall occur and
receipt of the Canadian Collateral Agent's written instructions pursuant to the
first sentence of this clause (b), all collected funds on deposit in the Cash
Proceeds Account, or so much thereof as is not required to make payment of the
Finance Obligations which have become due and payable (whether by scheduled
maturity, acceleration or otherwise), shall be withdrawn by the Canadian
Collateral Agent on the next Business Day following the day on which the
Canadian Collateral Agent considers the funds deposited therein to be collected
funds and disbursed to the Borrowers or its order. Each Canadian Credit Party
hereby irrevocably consents and agrees to such disbursement. After satisfaction
of the conditions specified in this clause (b), each Canadian Credit Party
hereby irrevocably authorizes and empowers the Canadian Collateral Agent, its
officers, employees and authorized agents to endorse and sign its name on all
checks, drafts, money orders or other media of payment so delivered, and such
endorsements or assignments shall, for all purposes, be deemed to have been made
by the relevant Canadian Credit Party prior to any endorsement or assignment
thereof by the Canadian Collateral Agent. The Canadian Collateral Agent may use
any convenient or customary means for the purpose of collecting such checks,
drafts, money orders or other media of payment.

        SECTION 2.05   REINVESTMENT FUNDS ACCOUNT.

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        (a)     CREATION OF AND DEPOSITS TO THE REINVESTMENT FUNDS ACCOUNT.
Promptly upon and at all times after the receipt by any Canadian Credit Party of
any Net Cash Proceeds from an Asset Disposition (other than an Excluded Asset
Disposition), Insurance Proceeds or Condemnation Awards or other amounts
required to be paid to the Canadian Collateral Agent pursuant to Section 2.10
(c) or 6.06(b) of the Credit Agreement, Section 4.10 hereof or pursuant to any
similar provision of any other Finance Document (collectively, "REINVESTMENT
FUNDS"), such Canadian Credit Party shall establish and shall thereafter
maintain an additional collateral account (the "REINVESTMENT FUNDS ACCOUNT") at
the offices of the Canadian Collateral Agent or such other bank or other
financial institution as such Canadian Credit Party and the Canadian Collateral
Agent may agree, in the name and under the exclusive control of the Canadian
Collateral Agent. If the Reinvestment Funds Account is not maintained at an
office of the Canadian Collateral Agent, then forthwith upon the establishment
of such account, the applicable Canadian Credit Party shall notify the Canadian
Collateral Agent of the location, account name and account number of such
account and shall deliver to the Canadian Collateral Agent an Account Control
Agreement with respect to such Reinvestment Funds Account duly executed by such
Canadian Credit Party and the Financial Intermediary maintaining such
Reinvestment Funds Account. Each Canadian Credit Party hereby agrees to cause
any Reinvestment Funds received from time to time after the establishment of the
Reinvestment Funds Account to be deposited therein as set forth in this
paragraph. Any Casualty Proceeds or Condemnation Proceeds in excess of
U.S.$5,000,000 (or the Canadian Dollar Equivalent thereof) received from time to
time by the Canadian Collateral Agent in respect of which the Canadian
Collateral Agent is an insured party and loss payee and any other Reinvestment
Funds shall be promptly deposited in the Reinvestment Funds Account as set forth
in this paragraph. Any income received with respect to the balance from time to
time standing to the credit of the Reinvestment Funds Account, including any
interest or capital gains on Liquid Investments, shall remain, or be deposited,
in the Reinvestment Funds Account until withdrawn pursuant to clause (b) below
or applied in accordance with Section 2.10(b) of the Credit Agreement. All
right, title and interest in and to the cash amounts on deposit from time to
time in the Reinvestment Funds Account together with any Liquid Investments from
time to time made pursuant to Section 2.07 and any other property or assets from
time to time deposited in or credited to the Reinvestment Funds Account shall
vest in the Canadian Collateral Agent for the benefit of the Finance Parties,
shall constitute part of the Collateral hereunder and shall not constitute
payment of the Finance Obligations until applied thereto as hereinafter
provided. The Canadian Collateral Agent shall apply to repayment of the Loans
those amounts on deposit in the Reinvestment Funds Account which are required to
be applied to the repayment of the Loans in accordance with Section 2.10(b)(iv)
and 2.10(c) of the Credit Agreement or any other applicable term of any Finance
Document, and, unless a Default or an Event of Default shall have occurred and
be continuing, shall promptly in accordance with subsection (b) below release
to, or upon the order of the Canadian Credit Party in respect of which such
Reinvestment Funds were delivered, those amounts on deposit in the Reinvestment
Funds Account which are not required to be so applied or retained in the
Reinvestment Funds Account pursuant to any other provision of any Finance
Document for application as provided in subsection (b) below.

        (b)     WITHDRAWALS FROM REINVESTMENT FUNDS ACCOUNT. The balance
from time to time standing to the credit of the Reinvestment Funds Account (to
the extent not applied pursuant to the last sentence of Section 2.05(a)) shall
be subject to withdrawal only upon the instructions of the Canadian Collateral
Agent. Except upon the occurrence and continuation of a Default or an Event of
Default, the Canadian Collateral Agent agrees to give instructions to distribute
such amounts to the applicable Canadian Credit Party at such times and in such
amounts as such Canadian Credit Party shall request for the purpose of (i) in
the case of Reinvestment Funds received on account of an Asset Disposition,
reinvesting such Reinvestment Funds in accordance with Section 2.10(c)(i) of the
Credit Agreement or (ii) in the case of Reinvestment Funds received on account
of Casualty or Condemnation, repairing,

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reconstructing or replacing the property in respect of which such Reinvestment
Funds were received or for the purpose of repaying indebtedness secured by a
Permitted Lien on, or meeting other liabilities in respect of, the property in
respect of which such Reinvestment Funds were received, all in accordance with
Section 2.10(c)(ii) of the Credit Agreement. Each Canadian Credit Party hereby
irrevocably consents and agrees to such distribution. To the extent required by
any Finance Document, any such request shall be accompanied by a certificate of
the chief executive officer or chief financial officer of such Canadian Credit
Party setting forth in detail reasonably satisfactory to the Canadian Collateral
Agent the reinvestment, repair, reconstruction or replacement for which such
funds will be expended. If immediately available cash on deposit in the
Reinvestment Funds Account is not sufficient to make any distribution to a
Canadian Credit Party referred to in the previous sentence of this Section
2.05(b), the Canadian Collateral Agent shall cause to be liquidated as promptly
as practicable such Liquid Investments in the Reinvestment Funds Account
designated by such Canadian Credit Party and the Borrowers as are required to
obtain sufficient cash to make such distribution and, notwithstanding any other
provision of this Article II, such distribution shall not be made until such
liquidation has taken place. Upon the occurrence and continuation of an Event of
Default, the Canadian Collateral Agent may apply or cause to be applied (subject
to collection) any or all of the balance from time to time standing to the
credit of the Reinvestment Funds Account in the manner specified in Section 5.04
hereof.

        SECTION 2.06   LC CASH COLLATERAL ACCOUNT

        All amounts required to be deposited by any Canadian Credit Party as
cash collateral for LC Obligations pursuant to Section 2.10(b)(i), (ii) or (iii)
or Section 8.02(c) of the Credit Agreement, any similar provision of any other
Finance Document or pursuant to Section 5.04 hereof shall be deposited in a
collateral account (the "LC CASH COLLATERAL ACCOUNT") established and maintained
by such Canadian Credit Party at the offices of the Canadian Collateral Agent or
such other bank or other financial institution as such Canadian Credit Party and
the Canadian Collateral Agent may agree, in the name and under the exclusive
control of the Canadian Collateral Agent. If the LC Cash Collateral Account is
not maintained at an office of the Canadian Collateral Agent, then forthwith
upon the establishment of such account, the applicable Canadian Credit Party
shall notify the Canadian Collateral Agent of the location, account name and
account number of such account and shall deliver to the Canadian Collateral
Agent an Account Control Agreement with respect to such LC Cash Collateral
Account duly executed by such Canadian Credit Party and the Financial
Intermediary maintaining such LC Cash Collateral Account. Any income received
with respect to the balance from time to time standing to the credit of the LC
Cash Collateral Account, including any interest or capital gains on Liquid
Investments, shall remain, or be deposited, in the LC Cash Collateral Account.
All right, title and interest in and to the cash amounts on deposit from time to
time in the LC Cash Collateral Account together with any Liquid Investments from
time to time made pursuant to Section 2.07 and any other property or assets from
time to time deposited in or credited to the LC Cash Collateral Account shall
vest in and be under the sole dominion and control of the Canadian Collateral
Agent for the benefit of the Finance Parties, shall constitute part of the
Collateral hereunder and shall not constitute payment of the Finance Obligations
until applied thereto as hereinafter provided. If and when any portion of the LC
Obligations on which any deposit in the LC Cash Collateral Account was based
(the "RELEVANT CONTINGENT EXPOSURE") shall become fixed (a "DIRECT EXPOSURE") as
a result of the payment by the Issuing Lender with respect thereto of a draft
presented under any Letter of Credit, the amount of such Direct Exposure (but
not more than the amount in the LC Cash Collateral Account at the time) shall be
withdrawn by the Canadian Collateral Agent from the LC Cash Collateral Account
and shall be paid to the relevant Administrative Agent for application pursuant
to the Credit Agreement, and the Relevant Contingent Exposure shall thereupon be
reduced by such amount. In addition, funds will be released from the LC Cash
Collateral Account at such times and in

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such amounts as provided in Section 2.05(r) of the Credit Agreement. Each
Canadian Credit Party hereby irrevocably consents and agrees to each such
distribution. If a Default or an Event of Default shall have occurred and be
continuing, the excess of the funds in the LC Cash Collateral Account over the
Relevant Contingent Exposure shall be retained in the LC Cash Collateral Account
and, upon the occurrence and continuation of an Event of Default, may be
withdrawn by the Canadian Collateral Agent and applied in the manner specified
in Section 5.04. If immediately available cash on deposit in the LC Cash
Collateral Account is not sufficient to make any distribution to a Canadian
Credit Party referred to in this Section 2.06, the Canadian Collateral Agent
shall cause to be liquidated as promptly as practicable such Liquid Investments
in the Cash Collateral Account designated by such Canadian Credit Party as are
required to obtain sufficient cash to make such distribution and,
notwithstanding any other provision of this Section 2.06, such distribution
shall not be made until such liquidation has taken place.

        SECTION 2.07   INVESTMENT OF FUNDS IN COLLATERAL ACCOUNTS

        Amounts on deposit in the Collateral Accounts shall be invested and
re-invested from time to time in such Liquid Investments as the Parent Borrower
shall determine, which Liquid Investments shall be held in the name and be under
the control of the Canadian Collateral Agent; PROVIDED that, if an Event of
Default has occurred and is continuing, the Canadian Collateral Agent may
liquidate any such Liquid Investments and apply or cause to be applied the
proceeds thereof in the manner specified in Section 5.04. For this purpose,
"LIQUID INVESTMENTS" means Cash Equivalents maturing within 30 days after a Cash
Equivalent is acquired by the Canadian Collateral Agent.

        SECTION 2.08   LEASES; NON-ASSIGNABLE CONTRACTS

        The grant of any Security Interest in respect of the Collateral shall
not include, with respect to any Canadian Credit Party, any item of property to
the extent the grant by such Canadian Credit Party of the Security Interest
pursuant to this Agreement in such Canadian Credit Party's right, title and
interest in such item of property is prohibited by an applicable enforceable
contractual obligation or requirement of Law or would give any other Person the
enforceable right to terminate its obligations with respect to such item of
property and provided, further, that the limitation in the foregoing proviso
shall not affect, limit, restrict or impair the grant by any Canadian Credit
Party of a security interest pursuant to this Agreement in any money or other
amounts due or to become due under any account, contract, agreement or
intangible. In addition, the Security Interests created by this Agreement do not
extend to the last day of the term of any lease or agreement for lease of Real
Property. Such last day shall be held by the applicable Canadian Credit Party in
trust for the Canadian Collateral Agent (for the benefit of the Finance Parties)
and, on the exercise by the Canadian Collateral Agent of any of its rights under
this Agreement following the occurrence and during the continuance of an Event
of Default, will be assigned by such Canadian Credit Party as directed by the
Canadian Collateral Agent.

                                   ARTICLE III
                         REPRESENTATIONS AND WARRANTIES

        Each Canadian Credit Party represents and warrants that:

        SECTION 3.01   TITLE TO COLLATERAL

        Such Canadian Credit Party has good and marketable title to, or valid
license, leasehold or similar interests in, all of the Collateral in which it
has granted a security interest hereunder, free and

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clear of any Liens other than Permitted Liens. Such Canadian Credit Party has
taken all actions necessary under applicable Law to perfect its interest in any
Receivables purchased by or assigned to it, as against its assignors and
creditors of its assignors. Other than financing statements or other similar or
equivalent documents or instruments with respect to the Security Interests,
Permitted Liens and Liens securing indebtedness to be repaid with the proceeds
of the Finance Obligations and in respect of which the Administrative Agents
have received pay-off letters and instruments appropriate under local Law to
effect the termination of such Liens, no financing statement, mortgage, security
agreement or similar or equivalent document or instrument covering all or any
part of the Collateral is on file or of record in any jurisdiction in which such
filing or recording would be effective to perfect a Lien on such Collateral. No
Collateral is in the possession or control of any Person (other than a Canadian
Credit Party) asserting any claim thereto or security interest therein, except
that the Canadian Collateral Agent or its designee may have possession and/or
control of Collateral as contemplated hereby and by the other Finance Documents.

        SECTION 3.02   VALIDITY, PERFECTION AND PRIORITY OF SECURITY INTERESTS.

        (a)     The Security Interests constitute valid security interests
under the applicable Law securing the Finance Obligations.

        (b)     When financing statements shall have been filed in the offices
specified in Schedule 4.01 hereto, the Security Interests will constitute
perfected security interests in all right, title and interest of such Canadian
Credit Party in the Collateral to the extent that a security interest therein
may be perfected by filing pursuant to the PPSA, the PERSONAL PROPERTY SECURITY
ACT (Nova Scotia), the PERSONAL PROPERTY SECURITY ACT (New Brunswick) or the
personal property security legislation of any other Canadian province (other
than the Province of Quebec), prior to all other Liens and rights of others
therein except for Permitted Liens.

        (c)     When a copy of this Agreement or a document evidencing the
assignment made under Section 2.01 has been filed with the Canadian Intellectual
Property, the Security Interests will constitute perfected security interests in
all right, title and interest of such Canadian Credit Party in the Recordable
Intellectual Property therein described to the extent that a security interest
therein may be perfected by such filing pursuant to applicable Law, prior to all
other Liens and rights of others therein except for Permitted Liens.

        SECTION 3.03   RECEIVABLES

        With respect to each material Receivable of such Canadian Credit Party,
all material records, papers and documents relating thereto (if any) are genuine
and in all respects what they purport to be, and all papers and documents (if
any) relating thereto (i) represent legal, valid and binding obligations of the
respective account debtor, subject to adjustments customary in the business of
such Canadian Credit Party, with respect to unpaid indebtedness or other
monetary obligations incurred by such account debtor in respect of the
performance of labor or services, the sale, lease, license, assignment, exchange
and delivery of the merchandise or other property listed therein, the incurrence
of a secondary obligation as set forth therein or the use of a credit or charge
card or information contained on or for use with such a card or any combination
of the foregoing, and (ii) are the only original writings evidencing and
embodying such obligations of the account debtor named therein (other than
copies created for general accounting purposes) and are in compliance in all
material respects with all applicable federal, provincial and local Laws and
applicable Laws of any relevant foreign jurisdiction.

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<Page>

        SECTION 3.04   NO CONSENTS

        No consent of any other Person (including, without limitation, any
stockholder or creditor of such Canadian Credit Party or any of its
Subsidiaries) and no order, consent, approval, license, authorization or
validation of, or filing, recording or registration with, or exemption by any
Governmental Authority is required to be obtained by such Canadian Credit Party
in connection with the execution, delivery or performance of this Agreement, or
in connection with the exercise of the rights and remedies of the Canadian
Collateral Agent pursuant to this Agreement, except (i) as may be required to
perfect (as described in Schedule 4.01 hereto) and maintain the perfection of
the Security Interests, or (ii) in connection with the disposition of the
Collateral by Laws affecting the offering and sale of Securities generally;
PROVIDED, HOWEVER, that to the extent that recordation of the Security Interests
in the Canadian Intellectual Property Office is necessary to perfect the
Security Interests or to render the Security Interests effective against
subsequent third parties, such recordations will not have been made with respect
to the items that are not Recordable Intellectual Property.

        SECTION 3.05   DEPOSIT AND SECURITIES ACCOUNTS

        Schedule 3.05 sets forth as of the date hereof a complete and correct
list of each Canadian Credit Party's Deposit Accounts, Individual Store Accounts
and Securities Accounts, the name and address of the bank or financial
institution which maintains each such account and the purpose for which such
account is used.

        SECTION 3.06   REPURCHASE AGREEMENT. (i) the Repurchase Agreement has
not been amended or modified, nor has any condition thereof been waived by the
U.S. Borrower or the Parent Borrower in a manner adverse in any material respect
to the rights or interests of the Lenders, and (ii) no event of default has
occurred thereunder.

                                   ARTICLE IV
                                    COVENANTS

        Each Canadian Credit Party covenants and agrees that until the payment
in full of all Finance Obligations and until there is no commitment by any
Finance Party to make further advances, incur obligations or otherwise give
value, such Canadian Credit Party will comply with the following:

        SECTION 4.01   DELIVERY OF PERFECTION CERTIFICATE; INITIAL PERFECTION
AND DELIVERY OF SEARCH REPORTS

        Such Canadian Credit Party has (i) delivered its Perfection Certificate
to the Canadian Collateral Agent, (ii) delivered, or will deliver as required by
Section 6.10(f) of the Credit Agreement, to the Canadian Collateral Agent a
fully executed Account Control Agreement with respect to each of its Deposit
Accounts (other than Deposit Accounts maintained with the Canadian Collateral
Agent, Exempt Deposit Accounts and Individual Store Accounts) and Securities
Accounts, and (iii) cause all filings and recordings specified in Schedule
Section 4.01 hereto to have been completed. The information set forth in the
Perfection Certificate shall be correct and complete as of the Closing Date.

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        SECTION 4.02   CHANGE OF NAME, IDENTITY, STRUCTURE OR LOCATION;
SUBJECTION TO OTHER SECURITY AGREEMENTS

        Except pursuant to Asset Dispositions permitted by the Credit Agreement,
such Canadian Credit Party will not change its name, identity, structure, or the
location of its head office or chief executive office in any manner, and shall
not become bound by a security agreement entered into by another Person, in each
case unless it shall have given the Canadian Collateral Agent not less than 30
days' prior notice thereof. Except pursuant to Asset Dispositions permitted by
the Credit Agreement, such Canadian Credit Party shall not in any event change
the location of any Collateral or its name, identity, structure or the location
of its head office or chief executive office or become bound, by a security
agreement entered into by another Person, if such change would cause the
Security Interests to lapse or cease to be perfected unless such Canadian Credit
Party has taken on or before the date of lapse all actions necessary to ensure
that the Security Interests in the Collateral do not lapse or cease to be
perfected.

        SECTION 4.03   FURTHER ACTIONS

        Such Canadian Credit Party will, from time to time at its expense and in
such manner and form as the Canadian Collateral Agent may reasonably request,
execute, deliver, file and record any financing statement, specific assignment,
instrument, document, agreement or other paper and take any other action
(including, without limitation, any filings of financing or continuation
statements under the PPSA or the personal property security legislation of any
other jurisdiction and any filings with the Canadian Intellectual Property
Office) that from time to time may be necessary or advisable under the PPSA or
with respect to Recordable Intellectual Property, or that the Canadian
Collateral Agent may reasonably request, in order to create, preserve, perfect,
confirm or validate the Security Interests or to enable the Canadian Collateral
Agent and the Finance Parties to obtain the full benefit of this Agreement or to
exercise and enforce any of its rights, powers and remedies created hereunder or
under applicable Law with respect to any of the Collateral it being understood
and agreed that no Account Control Agreements need to be delivered with respect
to the Individual Store Accounts. To the extent permitted by applicable Law,
such Canadian Credit Party hereby authorizes the Canadian Collateral Agent to
file, in the name of such Canadian Credit Party or otherwise and without the
signature or other separate authorization or authentication of such Canadian
Credit Party appearing thereon, such financing statements or continuation
statements as the Canadian Collateral Agent in its sole discretion may deem
necessary or appropriate to further perfect or maintain the perfection of the
Security Interests. Such Canadian Credit Party hereby authorizes the Canadian
Collateral Agent to file financing and continuation statements describing as the
Collateral covered thereby "all of the debtor's personal property and assets" or
words to similar effect, notwithstanding that such description may be broader in
scope than the Collateral described in this Agreement. Such Canadian Credit
Party agrees, where so permitted by applicable Law, that a carbon, photographic,
photostatic or other reproduction of this Agreement or of a financing statement
is sufficient as a financing statement. The Canadian Credit Parties shall pay
the costs of, or incidental to, any recording or filing of any financing or
continuation statements or other assignment documents concerning the Collateral.

        SECTION 4.04   COLLATERAL IN POSSESSION OF OTHER PERSONS, LEASED REAL
PROPERTY LOCATIONS

        If any of such Canadian Credit Party's Collateral is at any time in the
possession or control of any warehouseman, vendor, bailee or any agents or
processors of any Canadian Credit Party,

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such Canadian Credit Party shall (i) notify such warehouseman, vendor, bailee,
agent or processor of the Security Interests, (ii) instruct such warehouseman,
vendor, bailee, agent or processor to hold all such Collateral for the Canadian
Collateral Agent's account and subject to the Canadian Collateral Agent's
instructions and (iii) use commercially reasonable efforts to cause such
warehouseman, vendor, bailee, agent or processor to authenticate a record
acknowledging that it holds possession of such Collateral for the benefit of the
Canadian Collateral Agent and the Finance Parties and make such authenticated
record available to the Canadian Collateral Agent. If any Canadian Credit Party
enters into any lease of Material Real Property after the date hereof, such
Canadian Credit Party will use commercially reasonable efforts to obtain waivers
from the landlords of all such real estate, substantially in the form of Exhibit
B hereto or in such other form as shall be reasonably acceptable to the Canadian
Collateral Agent.

        SECTION 4.05   BOOKS AND RECORDS

        Such Canadian Credit Party shall keep full and accurate books and
records relating to the Collateral, including, but not limited to, the originals
of all documentation with respect thereto, records of all payments received, all
credits granted thereon, all merchandise returned and all other dealings
therewith, and such Canadian Credit Party will make the same available to the
Canadian Collateral Agent for inspection, as required by Section 6.09 of the
Credit Agreement. Upon direction by the Canadian Collateral Agent, such Canadian
Credit Party shall stamp or otherwise mark such books and records in such manner
as the Canadian Collateral Agent may reasonably require in order to reflect the
Security Interests.

        SECTION 4.06   DELIVERY OF INSTRUMENTS, ETC.

        Such Canadian Credit Party will immediately deliver each Instrument and
each certificated security (other than (i) Cash Equivalents held in a Deposit
Account or a Securities Account and subject to an effective Account Control
Agreement as required by Section 4.14 hereof and (ii) instruments or
certificated Securities received in connection with bankruptcy or reorganization
of suppliers and customers and in settlement of delinquent obligations of, and
other disputes with, customers and suppliers in the ordinary course of business
having individually, a face amount of less than U.S.$750,000 (or the Canadian
Equivalent Amount thereof) in the case of instruments or certificated Securities
subject to this CLAUSE (II)) to the Canadian Collateral Agent, appropriately
indorsed to the Canadian Collateral Agent; PROVIDED that so long as no Default
or Event of Default shall have occurred and be continuing, and except as
required by any other Finance Document, such Canadian Credit Party may (unless
otherwise provided in Section 2.04(b)) retain for collection in the ordinary
course of business any checks, drafts and other Instruments received by it in
the ordinary course of business, and the Canadian Collateral Agent shall,
promptly upon request of such Canadian Credit Party, make appropriate
arrangements for making any other instrument or certificated security pledged by
such Canadian Credit Party available to it for purposes of presentation,
collection or renewal (any such arrangement to be effected, to the extent deemed
appropriate to the Canadian Collateral Agent, against trust receipt or like
document).

        SECTION 4.07   COLLECTION AND VERIFICATION OF RECEIVABLES.

        (a)     COLLECTION OF RECEIVABLES. Such Canadian Credit Party shall
not rescind or cancel any material indebtedness or material obligation evidenced
by any material Receivable, modify, make adjustments to, extend, renew,
compromise or settle any material dispute, claim, suit or legal proceeding
relating to, or sell or assign, any material Receivable, or interest therein,
without the prior

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written consent of the Canadian Collateral Agent, except that, subject to the
rights of the Canadian Collateral Agent and the Finance Parties hereunder,
notwithstanding the occurrence and continuance of an Event of Default, such
Canadian Credit Party may allow as adjustments to amounts owing under its
Receivables (i) an extension or renewal of the time or times of payment, or
settlement for less than the total unpaid balance, which such Canadian Credit
Party finds appropriate in accordance with sound business judgment and (ii) a
refund or credit due as a result of returned or damaged merchandise, all in
accordance with such Canadian Credit Party's ordinary course of business
consistent with its historical collection practices. The costs and expenses
(including, without limitation, attorneys' fees) of collection of Receivables,
whether incurred by such Canadian Credit Party or the Canadian Collateral Agent,
shall be borne by the Canadian Credit Parties.

        (b)     VERIFICATION OF RECEIVABLES. Upon the occurrence and during the
continuance of an Event of Default, the Canadian Collateral Agent shall have the
right to make test verifications of Receivables in any manner and through any
medium that it considers advisable, and each Canadian Credit Party agrees to
furnish all such assistance and information as the Canadian Collateral Agent may
require in connection therewith. Upon the occurrence and during the continuance
of an Event of Default, each Canadian Credit Party, at its own expense, will
cause its financial officer to furnish to the Canadian Collateral Agent at any
time and from time to time promptly upon the Canadian Collateral Agent's request
(i) a reconciliation of all Receivables, (ii) an aging of all Receivables, (iii)
trail balances and (iv) a test verification of such Receivables as the Canadian
Collateral Agent may request.

        SECTION 4.08   NOTIFICATION TO ACCOUNT DEBTORS

        Upon the occurrence and during the continuance of any Event of Default
and if so requested by the Canadian Collateral Agent, such Canadian Credit Party
will promptly notify (and such Canadian Credit Party hereby authorizes the
Canadian Collateral Agent so to notify) each account debtor in respect of any
Receivable that such Collateral has been assigned to the Canadian Collateral
Agent hereunder for the benefit of the Finance Parties, and that any payments
due or to become due in respect of such Collateral are to be made by such
account debtor and any other Person via direct wire transfer to the Canadian
Collateral Agent or its designee in accordance with Section 2.04 hereof.

        SECTION 4.09   DISPOSITION OF COLLATERAL

        Such Canadian Credit Party will not sell, lease, exchange, license,
assign or otherwise dispose of, or grant any option with respect to, any
Collateral or create or suffer to exist any Lien (other than the Security
Interests and Permitted Liens) on any Collateral except that, subject to the
rights of the Canadian Collateral Agent and the Finance Parties hereunder if a
Default or an Event of Default shall have occurred and be continuing, such
Canadian Credit Party may sell, lease, exchange, license, assign or otherwise
dispose of, or grant options with respect to, Collateral to the extent expressly
permitted by the Credit Agreement, whereupon, in the case of any such
disposition, the Security Interests created hereby in such item (but not in any
Proceeds arising from such disposition) shall cease immediately without any
further action on the part of the Canadian Collateral Agent.

        SECTION 4.10   INSURANCE

        Prior to the Closing Date, such Canadian Credit Party will cause the
Canadian Collateral Agent (together with the Canadian Collateral Agent) to be
named as an insured party and loss payee, effective at all times on and after
the Closing Date, on each insurance policy covering risks relating to any

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of its Inventory and Equipment. Each such insurance policy shall include
effective waivers by the insurer of all claims for insurance premiums against
the Canadian Collateral Agent and the Finance Parties, provide for coverage to
the Canadian Collateral Agent for the benefit of the Finance Parties regardless
of the breach by such Canadian Credit Party of any warranty or representation
made therein, not be subject to co-insurance, provide that all insurance
proceeds in excess of U.S.$5,000,000 (or the Canadian Equivalent Amount thereof)
per claim shall be adjusted with and payable to the Canadian Collateral Agent
(for payment to the relevant Administrative Agent for application as required by
Section 2.10(b), (c) or 6.06(b) of the Credit Agreement, if then in effect, or
otherwise as contemplated by the other Finance Documents) and provide that no
cancellation, termination or material modification thereof shall be effective
until at least 30 days after receipt by the Canadian Collateral Agent of notice
thereof. Such Canadian Credit Party hereby appoints the Canadian Collateral
Agent as its attorney-in-fact, effective during the continuance of an Event of
Default, to make proof of loss, claims for insurance and adjustments with
insurers, and to execute or endorse all documents, checks or drafts in
connection with payments made as a result of any insurance policies.

        Such Canadian Credit Party assumes all liability and responsibility in
connection with the Collateral acquired by it and the liability of such Canadian
Credit Party to pay the Finance Obligations shall in no way be affected or
diminished by reason of the fact that such Collateral may be lost, destroyed,
stolen, damaged or for any reason whatsoever unavailable to such Canadian Credit
Party.

        SECTION 4.11   INFORMATION REGARDING COLLATERAL

        Such Canadian Credit Party will, promptly upon request, provide to the
Canadian Collateral Agent all information and evidence it may reasonably request
concerning the Collateral to enable the Canadian Collateral Agent to enforce the
provisions of this Agreement.

        SECTION 4.12   COVENANTS REGARDING INTELLECTUAL PROPERTY.

        (a)     Such Canadian Credit Party (either itself or through licensees)
will, for each Patent, not do any act, or omit to do any act, whereby any Patent
may become invalidated or dedicated to the public, and shall continue to mark
any products covered by a Patent with the relevant patent number or indication
that a Patent is pending as required by the patent laws, unless such Canadian
Credit Party shall reasonably and in good faith determine (and notice of such
determination shall have been delivered to the Canadian Collateral Agent) that
any of the Patent is of negligible economic value to such Canadian Credit Party.

        (b)     Such Canadian Credit Party (either itself or, if permitted
by Law, through its licensees or its sublicensees) will, for each Trademark, (i)
maintain such Trademark in full force free from any claim of abandonment or
invalidity from non-use, material alteration, naked licensing or genericide,
(ii) maintain the quality of products and services offered under such Trademark
in a manner substantially consistent with or better than the quality of such
products and services as of the date hereof, (iii) display such Trademark with
proper notice, including notice of federal registration to the extent permitted
by applicable Law, (iv) not knowingly use or knowingly permit the use of such
Trademark in violation of any third party rights, (v) not permit any assignment
in gross of such Trademark, unless such Canadian Credit Party shall reasonably
and in good faith determine (and notice of such determination shall have been
delivered to the Canadian Collateral Agent) that any of the Trademarks is of
negligible economic value to such Canadian Credit Party and (vi) allow the
Canadian Collateral Agent and its designees the right, at any time and from time
to time, to inspect such Canadian Credit Party's premises and to examine

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and observe such Canadian Credit Party's books, records and operations,
including, without limitation, its quality control processes, upon reasonable
notice and at such reasonable times and as often as may be reasonably requested.

        (c)     Such Canadian Credit Party (either itself or through licensees
or sublicensees) will, for each work covered by a Copyright material to the
conduct of its business, continue to publish, reproduce, display, adopt and
distribute the work with appropriate copyright notice.

        (d)     Such Canadian Credit Party shall promptly notify the Canadian
Collateral Agent if a Responsible Officer knows or has reason to know that any
Patent, Trademark or Copyright (or any application or registration relating
thereto) may become abandoned or dedicated to the public, or of any adverse
determination or development (including, without limitation, the institution of,
or any such determination or development in, any proceeding in the Canadian
Intellectual Property Office or any court) regarding such Canadian Credit
Party's ownership of any Patent, Trademark, Copyright or Software, its right to
register the same or to keep, use or maintain the same unless such Canadian
Credit Party shall reasonably and in good faith determine (and notice of such
determination shall have been delivered to the Canadian Collateral Agent) that
any of the Patents, Trademarks and Copyrights is of negligible economic value to
such Canadian Credit Party.

        (e)     Unless such Canadian Credit Party shall reasonably and in good
faith determine (and notice of such determination shall have been delivered to
the Canadian Collateral Agent) that any of the Patents, Trademarks and
Copyrights is of negligible economic value to such Canadian Credit Party, such
Canadian Credit Party Canadian Credit Party will take all necessary steps to
file, maintain and pursue each application relating to the Patents, Trademarks
and/or Copyrights (and to obtain the relevant grant or registration) and to
preserve and maintain all common law rights in any Trademarks and each
registration of the Patents, Trademarks and Copyrights, including filing and
paying fees for applications for renewal, reissues, divisions, continuations,
continuations-in-part, affidavits of use, affidavits of incontestability and
maintenance, and, unless such Canadian Credit Party shall reasonably determine
that any such action would be of negligible economic value, to initiate
opposition, interference, reexamination and cancellation proceedings against
third parties that infringe a Patent, Trademark or Copyright.

        (f)     If any rights to any Patent, Trademark, Copyright, Software or
License relating thereto is believed infringed, misappropriated, breached or
diluted by a third party, such Canadian Credit Party shall notify the Canadian
Collateral Agent promptly after a Responsible Officer obtains knowledge thereof
and shall, unless such Canadian Credit Party shall reasonably determine that any
such action would be of negligible economic value, promptly sue for
infringement, misappropriation, breach or dilution and to recover any and all
damages for such infringement, misappropriation or dilution, and take such other
actions as such Canadian Credit Party shall reasonably deem appropriate under
the circumstances to protect such Patent, Trademark, Copyright, Software or
License unless such Canadian Credit party shall reasonably and in good faith
determine (and notice of such determination shall have been delivered to the
Canadian Collateral Agent) that any of the Patents, Trademarks and Copyrights is
of negligible economic value to such Canadian Credit Party.

        (g)     Within 45 days after the end of each fiscal quarter of the
Parent Borrower, each Canadian Credit Party will (i) inform the Canadian
Collateral Agent of all applications for Patents, Trademarks or Copyrights filed
during such fiscal quarter by such Canadian Credit Party or by any agent,
employee, licensee or delegate on its behalf with the Canadian Intellectual
Property Office or any office or agency in any political subdivision of Canada
or in any other country or any political subdivision

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thereof and (ii) upon request of the Canadian Collateral Agent, execute any and
all agreements, instruments, documents and papers as the Canadian Collateral
Agent may reasonably request to evidence the Security Interests in such
application, any resulting Patent, Trademark or Copyright and the goodwill or
Accounts and general intangibles of such Canadian Credit Party relating thereto
or represented thereby, and such Canadian Credit Party hereby appoints the
Canadian Collateral Agent its attorney-in-fact to execute and file such writings
for the foregoing purposes.

        (h)     As to all material Licenses (excluding non-exclusive Licenses of
Software) entered into after the date hereof with any third party licensor, such
Canadian Credit Party will use commercially reasonable and good faith efforts to
obtain all requisite consents or approvals by the licensor to perfect the
Security Interests therein.

        (i)     Such Canadian Credit Party has taken, and shall take all actions
(and cause all other Persons, including licensees, to the extent such other
Persons are subject to its control) which are necessary or advisable to protect,
preserve and confirm the validity, priority, perfection or enforcement of the
rights granted to the Canadian Collateral Agent under this Agreement and (iii)
give the Canadian Collateral Agent prompt written notice in accordance with
Section 4.12(g) above, if, after the date hereof, such Canadian Credit Party
shall obtain rights to any Trademarks, Patents or Copyrights, or enter into any
new license agreements regarding any of the foregoing, and such Canadian Credit
Party hereby agrees that the provisions of this Agreement shall automatically
apply thereto. Such Canadian Credit Party will use commercially reasonable
efforts so as not to permit the inclusion in any material contract or agreement
governing or relating to any Trademarks, Patents or Copyrights obtained after
the date hereof or any license agreements entered into after the date hereof
relating to any of the foregoing of any provisions that could or might in any
way prevent or materially impair the creation of a security interest in, or the
assignment of, such Canadian Credit Party's rights and interests therein. Such
Canadian Credit Party will execute any and all agreements, instruments,
documents and papers as the Canadian Collateral Agent may request to evidence
the Security Interests in any Patent, Trademark or Copyright (or application
therefor) and the goodwill or accounts and general intangibles of such Canadian
Credit Party relating thereto or represented thereby, and such Canadian Credit
Party hereby appoints the Canadian Collateral Agent its attorney-in-fact to
execute and file such writings for the foregoing purposes.

        SECTION 4.13   DEPOSIT ACCOUNTS AND SECURITIES ACCOUNTS

        No Canadian Credit Party shall establish after the date hereof or permit
to exist any Deposit Account (except for any such account maintained with the
Canadian Collateral Agent, Exempt Deposit Accounts and Individual Store
Accounts) or any Securities Account (except any such account maintained with the
Canadian Collateral Agent or constituting Collateral Accounts) without promptly
delivering to the Canadian Collateral Agent a fully executed Account Control
Agreement with respect to such account. Subject to Section 2.04(b) hereof and
the rights of the Canadian Collateral Agent under Article V hereof, each
Canadian Credit Party shall cause all Proceeds of Collateral hereunder to be
deposited in a Deposit Account maintained with the Canadian Collateral Agent or
with respect to which an effective Account Control Agreement has been delivered
to the Canadian Collateral Agent. No Canadian Credit Party shall permit the
aggregate amount of overnight funds on deposit in all Exempt Deposit Accounts
and Individual Store Accounts to exceed U.S.$5,000,000 (or the Canadian
Equivalent Amount thereof).

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        SECTION 4.14   MODIFICATION OF ASSIGNED AGREEMENTS, ETC.

        Such Canadian Credit Party will not, except with the consent of the
relevant Administrative Agent, terminate any Assigned Agreement, waive any
default under or breach of any Assigned Agreement, compromise or settle any
material dispute, claim, suit or legal proceeding relating to any Assigned
Agreement, sell or assign any Assigned Agreement or interest therein, consent to
or permit or accept any prepayment of amounts to become due under or in
connection with any Assigned Agreement, except as expressly provided therein, or
take any other action in connection with any Assigned Agreement which would
impair the value of the interests or rights of such Canadian Credit Party
thereunder or which would materially impair the interests or rights of the
Canadian Collateral Agent under this Agreement, except that, unless the Canadian
Collateral Agent shall have notified such Canadian Credit Party upon the
occurrence of a Default or an Event of Default that this exception is no longer
applicable, such Canadian Credit Party may modify, make adjustments with respect
to, extend or renew any Assigned Agreements in the ordinary course of business.

                                    ARTICLE V
                           GENERAL AUTHORITY; REMEDIES

        SECTION 5.01   GENERAL AUTHORITY

        Each Canadian Credit Party hereby irrevocably appoints the Canadian
Collateral Agent and any officer or agent duly appointed by the Canadian
Collateral Agent as its true and lawful attorney-in-fact, with full power of
substitution, in the name of such Canadian Credit Party, the Canadian Collateral
Agent, the Finance Parties or otherwise, for the sole use and benefit of the
Canadian Collateral Agent and the Finance Parties, but at such Canadian Credit
Party's expense, to the extent permitted by Law, to exercise at any time and
from time to time while an Event of Default has occurred and is continuing all
or any of the following powers with respect to all or any of the Collateral, all
acts of such attorney being hereby ratified and confirmed; such power, being
coupled with an interest, is irrevocable until the Finance Obligations are paid
in full and until there is no commitment by any Finance Parties to make further
advances, incur obligations or otherwise give value:

                (i)    to take any and all appropriate action and to execute any
     and all documents and instruments which may be necessary or desirable to
     carry out the terms of this Agreement;

                (ii)   to receive, take, indorse, assign and deliver any and all
     checks, notes, drafts, acceptances, documents and other negotiable and
     non-negotiable instruments taken or received by such Canadian Credit Party
     as, or in connection with, Collateral;

                (iii)  to accelerate any Receivable which may be accelerated in
     accordance with its terms, and to otherwise demand, sue for, collect,
     receive and give acquittance for any and all monies due or to become due on
     or by virtue of any Collateral;

                (iv)   to commence, settle, compromise, compound, prosecute,
     defend or adjust any claim, suit, action or proceeding with respect to, or
     in connection with, the Collateral;

                (v)    to sell, transfer, assign or otherwise deal in or with
     the Collateral or the Proceeds or avails thereof, including, without
     limitation, for the implementation of any

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     assignment, lease, License, sublicense, grant of option, sale or other
     disposition of any Patent, Trademark, Copyright or Software or any action
     related thereto, as fully and effectually as if the Canadian Collateral
     Agent were the absolute owner thereof;

                (vi)   to extend the time of payment of any or all of the
     Collateral and to make any allowance and other adjustments with respect
     thereto; and

                (vii)  to do, at its option, but at the expense of such Canadian
     Credit Party, at any time or from time to time, all acts and things which
     the Canadian Collateral Agent reasonably deems necessary to protect or
     preserve the Collateral and to realize upon the Collateral.

        SECTION 5.02   REMEDIES UPON EVENT OF DEFAULT.

        (a)     If any Event of Default has occurred and is continuing, the
Canadian Collateral Agent may, in addition to all other rights and remedies
granted to it in this Agreement and in any other agreement securing, evidencing
or relating to the Finance Obligations: (i) exercise on behalf of the Finance
Parties all rights and remedies of a secured party under the PPSA (whether or
not in effect in the jurisdiction where such rights are exercised) and, in
addition, (ii) without demand of performance or other demand or notice of any
kind (except as herein provided or as may be required by mandatory provisions of
Law) to or upon any Canadian Credit Party or any other Person (all of which
demands and/or notices are hereby waived by each Canadian Credit Party), (A)
withdraw all cash and Liquid Investments in the Collateral Accounts and apply
such cash and Liquid Investments and other cash, if any, then held by it as
Collateral as specified in Section 5.04, (B) give notice and take sole
possession and control of all amounts on deposit in or credited to any
Collateral Account pursuant to the related Account Control Agreement and apply
all such funds as specified in Section 5.04 and (C) if there shall be no such
cash, Liquid Investments or other amounts or if such cash, Liquid Investments
and other amounts shall be insufficient to pay all the Finance Obligations in
full or cannot be so applied for any reason or if the Canadian Collateral
Account determines to do so, collect, receive, appropriate and realize upon the
Collateral and/or sell, assign, give an option or options to purchase or
otherwise dispose of and deliver the Collateral (or contract to do so) or any
part thereof at public or private sale, at any office of the Canadian Collateral
Agent or elsewhere in such manner as is commercially reasonable and as the
Canadian Collateral Agent may deem best, for cash, on credit or for future
delivery, without assumption of any credit risk and at such price or prices as
the Canadian Collateral Agent may deem satisfactory.

        (b)     The Canadian Collateral Agent shall give each Canadian Credit
Party not less than 15 days' prior notice of the time and place of any sale or
other intended disposition of any of the Collateral, except any Collateral which
is perishable or threatens to decline speedily in value or is of a type
customarily sold on a recognized market. Any such notice shall (i) in the case
of a public sale, state the time and place fixed for such sale, (ii) in the case
of a private sale, state the day after which such sale may be consummated, (iii)
contain the information specified in the personal property security legislation
of the applicable jurisdiction, (iv) be authenticated and (v) be sent to the
parties required to be notified pursuant to the applicable Law; PROVIDED that,
if the Canadian Collateral Agent fails to comply with this sentence in any
respect, its liability for such failure shall be limited to the liability (if
any) imposed on it as a matter of law under the personal property security
legislation of the applicable jurisdiction. Except as otherwise provided herein,
each Canadian Credit Party hereby waives, to the extent permitted by applicable
Law, notice and judicial hearing in connection with the Canadian Collateral
Agent's taking possession or disposition of any of the Collateral.

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        (c)     The Canadian Collateral Agent or any Finance Party may be the
purchaser of any or all of the Collateral so sold at any public sale (or, if the
Collateral is of a type customarily sold in a recognized market or is of a type
which is the subject of widely distributed standard price quotations, at any
private sale). Each Canadian Credit Party will execute and deliver such
documents and take such other action as the Canadian Collateral Agent reasonably
deems necessary or advisable in order that any such sale may be made in
compliance with Law. Upon any such sale, the Canadian Collateral Agent shall
have the right to deliver, assign and transfer to the purchaser thereof the
Collateral so sold. Each purchaser at any such sale shall hold the Collateral so
sold to it absolutely and free from any claim or right of whatsoever kind. Any
such public sale shall be held at such time or times within ordinary business
hours and at such place or places as the Canadian Collateral Agent may fix in
the notice of such sale. At any such sale, the Collateral may be sold in one lot
as an entirety or in separate parcels, as the Canadian Collateral Agent may
determine. The Canadian Collateral Agent shall not be obligated to make any such
sale pursuant to any such notice. The Canadian Collateral Agent may, without
notice or publication, adjourn any public or private sale or cause the same to
be adjourned from time to time by announcement at the time and place fixed for
the sale, and such sale may be made at any time or place to which the same may
be so adjourned without further notice. In the case of any sale of all or any
part of the Collateral on credit or for future delivery, the Collateral so sold
may be retained by the Canadian Collateral Agent until the selling price is paid
by the purchaser thereof, but the Canadian Collateral Agent shall not incur any
liability in the case of the failure of such purchaser to take up and pay for
the Collateral so sold and, in the case of any such failure, such Collateral may
again be sold upon like notice.

        (d)     For the purpose of enforcing any and all rights and remedies
under this Agreement, the Canadian Collateral Agent may, if any Event of Default
has occurred and is continuing, (i) require each Canadian Credit Party to, and
each Canadian Credit Party agrees that it will, at its expense and upon the
request of the Canadian Collateral Agent, forthwith assemble, store and keep all
or any part of the Collateral as directed by the Canadian Collateral Agent and
make it available at a place designated by the Canadian Collateral Agent which
is, in the Canadian Collateral Agent's opinion, reasonably convenient to the
Canadian Collateral Agent and such Canadian Credit Party, whether at the
premises of such Canadian Credit Party or otherwise, it being understood that
such Canadian Credit Party's obligation so to deliver the Collateral is of the
essence of this Agreement and that, accordingly, upon application to a court of
equity having jurisdiction, the Canadian Collateral Agent shall be entitled to a
decree requiring specific performance by such Canadian Credit Party of such
obligation; (ii) to the extent permitted by applicable Law, enter, with or
without process of law and without breach of the peace, any premise where any of
the Collateral is or may be located, and without charge or liability to any
Canadian Credit Party, seize and remove such Collateral from such premises;
(iii) have access to and use such Canadian Credit Party's books and records
relating to the Collateral; and (iv) prior to the disposition of the Collateral,
store or transfer it without charge in or by means of any storage or
transportation facility owned or leased by such Canadian Credit Party, process,
repair or recondition it or otherwise prepare it for disposition in any manner
and to the extent the Canadian Collateral Agent deems appropriate and, in
connection with such preparation and disposition, use without charge any
Intellectual Property or technical process used by such Canadian Credit Party.
The Canadian Collateral Agent may also render any or all of the Collateral
unusable at any Canadian Credit Party's premises and may dispose of such
Collateral on such premises without liability for rent or costs.

        (e)     Without limiting the generality of the foregoing, if any Event
of Default has occurred and is continuing:

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<Page>

                (i)    the Canadian Collateral Agent may, subject to the express
     terms of any valid and enforceable restriction in favor of a Person who is
     not a Group Company that prohibits, or requires any consent or establishes
     any other conditions for, an assignment thereof, license, or sublicense,
     whether general, special or otherwise, and whether on an exclusive or
     non-exclusive basis, any Patents, Trademarks or Copyrights included in the
     Collateral throughout the world for such term or terms, on such conditions
     and in such manner as the Canadian Collateral Agent shall determine subject
     to the requirements of the PPSA in respect thereof;

                (ii)   the Canadian Collateral Agent may (without assuming any
     obligations or liability thereunder), at any time and from time to time,
     enforce (and shall have the exclusive right to enforce) against any
     Licensee or sublicensee all rights and remedies of any Canadian Credit
     Party in, to and under any License and take or refrain from taking any
     action under any provision thereof, and each Canadian Credit Party hereby
     releases the Canadian Collateral Agent and each of the Finance Parties
     from, and agrees to hold the Canadian Collateral Agent and each of the
     Finance Parties free and harmless from and against any claims arising out
     of, any lawful action so taken or omitted to be taken with respect thereto;

                (iii)  upon request by the Canadian Collateral Agent, each
     Canadian Credit Party will use its commercially reasonable efforts to
     obtain all requisite consents or approvals by the licensor or sublicensor
     of each License to effect the assignment of all of such Canadian Credit
     Party's right, title and interest thereunder to the Canadian Collateral
     Agent or its designee and will execute and deliver to the Canadian
     Collateral Agent a power of attorney, in form and substance reasonably
     satisfactory to the Canadian Collateral Agent, for the implementation of
     any lease, assignment, License, sublicense, grant of option, sale or other
     disposition of a Patent, Trademark or Copyright; and

                (iv)   the Canadian Collateral Agent may direct each Canadian
     Credit Party to refrain, in which event each such Canadian Credit Party
     shall refrain, from using or practicing any Trademark, Patent or Copyright
     in any manner whatsoever, directly or indirectly, and shall, if requested
     by the Canadian Collateral Agent, change such Canadian Credit Party's name
     to eliminate therefrom any use of any Trademark and will execute such other
     and further documents as the Canadian Collateral Agent may request to
     further confirm this change and transfer ownership of the Trademarks,
     Patents, Copyrights and registrations and any pending applications therefor
     to the Canadian Collateral Agent.

        (f)     In the event of any disposition following the occurrence and
during the continuance of any Event of Default of any Patent, Trademark or
Copyright pursuant to this Article V, each Canadian Credit Party shall supply
its know-how and expertise relating to the manufacture and sale of the products
or services bearing Trademarks or the products, services or works made or
rendered in connection with or under Patents, Trademarks or Copyrights, and its
customer lists and other records relating to such Patents, Trademarks or
Copyrights and to the distribution of said products, services or works, to the
Canadian Collateral Agent.

        (g)     If any Event of Default has occurred and is continuing, the
Canadian Collateral Agent, instead of exercising the power of sale conferred
upon it pursuant to this Section 5.02, may proceed by a suit or suits at law or
in equity to foreclose the Security Interests and sell the Collateral, or any
portion thereof, under a judgment or decree of a court or courts of competent
jurisdiction, and may in

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<Page>

addition institute and maintain such suits and proceedings as the Canadian
Collateral Agent may deem appropriate to protect and enforce the rights vested
in it by this Agreement.

        (h)     If any Event of Default has occurred and is continuing, the
Canadian Collateral Agent shall, to the extent permitted by applicable Law,
without notice to any Canadian Credit Party or any party claiming through any
Canadian Credit Party, without regard to the solvency or insolvency at such time
of any Person then liable for the payment of any of the Finance Obligations,
without regard to the then value of the Collateral and without requiring any
bond from any complainant in such proceedings, be entitled as a matter of right
to the appointment of a receiver or receivers (who may be the Canadian
Collateral Agent) of the Collateral or any part thereof, and of the profits,
revenues and other income thereof, pending such proceedings, with such powers as
the court making such appointment shall confer, and to the entry of an order
directing that the profits, revenues and other income of the property
constituting the whole or any part of the Collateral be segregated, sequestered
and impounded for the benefit of the Canadian Collateral Agent and the Finance
Parties, and each Canadian Credit Party irrevocably consents to the appointment
of such receiver or receivers and to the entry of such order.

        (i)     Each Canadian Credit Party agrees, to the extent it may lawfully
do so, that it will not at any time in any manner whatsoever claim or take the
benefit or advantage of, any appraisal, valuation, stay, extension, moratorium,
turnover or redemption Law, or any Law permitting it to direct the order in
which the Collateral shall be sold, now or at any time hereafter in force which
may delay, prevent or otherwise affect the performance or enforcement of this
Agreement, and each Canadian Credit Party hereby waives all benefit or advantage
of all such Laws. Each Canadian Credit Party covenants that it will not hinder,
delay or impede the execution of any power granted to the Canadian Collateral
Agent, the Administrative Agents or any other Finance Party in any Finance
Document.

        (j)     Each Canadian Credit Party, to the extent it may lawfully do so,
on behalf of itself and all who claim through or under it, including, without
limitation, any and all subsequent creditors, vendees, assignees and lienors,
waives and releases all rights to demand or to have any marshalling of the
Collateral upon any sale, whether made under any power of sale granted herein or
pursuant to judicial proceedings or under any foreclosure or any enforcement of
this Agreement, and consents and agrees that all of the Collateral may at any
such sale be offered and sold as an entirety.

        (k)     Each Canadian Credit Party waives, to the extent permitted by
Law, presentment, demand, protest and any notice of any kind (except the notices
expressly required hereunder or in the other Finance Documents) in connection
with this Agreement and any action taken by the Canadian Collateral Agent with
respect to the Collateral.

        SECTION 5.03   LIMITATION ON DUTY OF CANADIAN COLLATERAL AGENT IN
RESPECT OF COLLATERAL

        Beyond the exercise of reasonable care in the custody thereof, neither
the Canadian Collateral Agent nor the Finance Parties shall have any duty to
exercise any rights or take any steps to preserve the rights of any Canadian
Credit Party in the Collateral in its or their possession or control or in the
possession or control of any agent or bailee or any income thereon or as to the
preservation of rights against prior parties or any other rights pertaining
thereto, nor shall the Canadian Collateral Agent or any Finance Party be liable
to any Canadian Credit Party or any other Person for failure to meet any
obligation imposed by the PPSA. Each Canadian Credit Party agrees that the
Canadian Collateral Agent shall at no time be required to, nor shall the
Canadian Collateral Agent be liable to any Canadian Credit

                                       - -
<Page>

Party for any failure to, account separately to any Canadian Credit Party for
amounts received or applied by the Canadian Collateral Agent from time to time
in respect of the Collateral pursuant to the terms of this Agreement. Without
limiting the foregoing, the Canadian Collateral Agent shall be deemed to have
exercised reasonable care in the custody and preservation of the Collateral in
its possession if the Collateral is accorded treatment substantially equal to
that which the Canadian Collateral Agent accords its own property, and shall not
be liable or responsible for any loss or damage to any of the Collateral, or for
any diminution in the value thereof, by reason of the act or omission of any
warehouseman, carrier, forwarding agency, consignee or other agent or bailee
selected by the Canadian Collateral Agent in good faith.

        SECTION 5.04   APPLICATION OF PROCEEDS.

        (a)     PRIORITY OF DISTRIBUTIONS. The Proceeds of any sale of, or other
realization upon, all or any part of the Collateral and any cash held in the
Collateral Accounts shall be applied as provided in Section 8.03 of the Credit
Agreement. The Canadian Collateral Agent may make distributions hereunder in
cash or in kind or, on a ratable basis, in any combination thereof.

        (b)     DISTRIBUTIONS WITH RESPECT TO LETTERS OF CREDIT AND BANKERS'
ACCEPTANCES. Each of the Canadian Credit Parties and the Finance Parties agrees
and acknowledges that if (after all outstanding Loans, LC obligations and BA
Reimbursement Obligations have been paid in full) the Lenders are to receive a
distribution on account of undrawn amounts with respect to Letters of Credit
issued (or deemed issued) or Bankers' Acceptances issued under the Credit
Agreement, such amounts shall be deposited in the applicable LC Cash Collateral
Account (in the case of Letters of Credit), or the relevant cash collateral
account established pursuant to Section 2.06(k) of the Credit Agreement (the "BA
CASH COLLATERAL ACCOUNT") (in the case of Bankers' Acceptances), as cash
security for the repayment of Finance Obligations owing to the Lenders as such.
Upon termination of all outstanding Letters of Credit and Bankers' Acceptances,
all of such cash security shall be applied to the remaining Finance Obligations
of the Lenders. If there remains any excess cash security, such excess cash
shall be withdrawn by the Canadian Collateral Agent or by the U.S. Collateral
Agent, as the case may be, from the U.S. LC Cash Collateral Account or the
Canadian LC Cash Collateral Account, respectively, or by the Canadian Collateral
Agent from the BA Cash Collateral Account, and distributed in accordance with
Section 5.04(a) hereof.

        (c)     RELIANCE BY CANADIAN COLLATERAL AGENT. For purposes of applying
payments received in accordance with this Section 5.04, the Canadian Collateral
Agent shall be entitled to rely upon (i) the relevant Administrative Agent under
the Credit Agreement and (ii) the authorized representative (the
"REPRESENTATIVE") for the Derivatives Creditors for a determination (which the
relevant Administrative Agent, each Representative for any Derivatives Creditor
and the Finance Parties agree (or shall agree) to provide upon request of the
Canadian Collateral Agent) of the outstanding Senior Obligations and Derivatives
Obligations owed to the Finance Parties, and shall have no liability to any
Canadian Credit Party or any other Finance Party for actions taken in reliance
on such information except in the case of its gross negligence or willful
misconduct. Unless it has actual knowledge (including by way of written notice
from a Derivatives Creditor) to the contrary, the Canadian Collateral Agent, in
acting hereunder, shall be entitled to assume that no Derivatives Agreements are
in existence. All distributions made by the Canadian Collateral Agent pursuant
to this Section shall be presumptively correct (except in the event of manifest
error), and the Canadian Collateral Agent shall have no duty to inquire as to
the application by the Finance Parties of any amounts distributed to them.

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<Page>

        (d)     DEFICIENCIES. It is understood that the Canadian Credit Parties
shall remain liable to the extent of any deficiency between the amount of the
proceeds of the Collateral and the amount of the Finance Obligations.

        SECTION 5.05   ASSIGNED AGREEMENTS

        Each Canadian Credit Party hereby irrevocably authorizes and empowers
the Canadian Collateral Agent, in the Canadian Collateral Agent's sole
discretion, if an Event of Default has occurred and is continuing, to assert,
either directly or on behalf of such Canadian Credit Party, any claims such
Canadian Credit Party may have from time to time against any other party to any
Assigned Agreement or to otherwise exercise any right or remedy of such Canadian
Credit Party under any Assigned Agreement (including without limitation, the
right to enforce directly against any party to an Assigned Agreement all of such
Canadian Credit Party's rights thereunder, to make all demands and give all
notices and make all requests required or permitted to be made by such Canadian
Credit Party under any Assigned Agreements) as the Canadian Collateral Agent may
deem proper. Each Canadian Credit Party hereby irrevocably makes, constitutes
and appoints the Canadian Collateral Agent (and all officers, employees or
agents designated by the Canadian Collateral Agent) as such Canadian Credit
Party's true and lawful attorney-in-fact for the purpose of enabling the
Canadian Collateral Agent to assert and collect such claims and to exercise such
rights and remedies.

                                   ARTICLE VI
                                COLLATERAL AGENT

        SECTION 6.01   CONCERNING THE CANADIAN COLLATERAL AGENT

        The provisions of Article IX of the Credit Agreement shall inure to the
benefit of the Canadian Collateral Agent in respect of this Agreement and shall
be binding upon all Canadian Credit Parties and all Finance Parties and upon the
parties hereto in such respect. In furtherance and not in derogation of the
rights, privileges and immunities of the Canadian Collateral Agent therein set
forth:

                (i)    The Canadian Collateral Agent is authorized to take all
     such actions as are provided to be taken by it as Canadian Collateral Agent
     hereunder and all other action reasonably incidental thereto. As to any
     matters not expressly provided for herein (including, without limitation,
     the timing and methods of realization upon the Collateral), the Canadian
     Collateral Agent shall act or refrain from acting in accordance with
     written instructions [from the Required Lenders] or, in the absence of such
     instructions or provisions, in accordance with its discretion.

                (ii)   The Canadian Collateral Agent shall not be responsible
     for the existence, genuineness or value of any of the Collateral or for the
     validity, perfection, priority or enforceability of the Security Interests
     in any of the Collateral, whether impaired by operation of law or by reason
     of any action or omission to act on its part hereunder unless such action
     or omission constitutes gross negligence or willful misconduct. The
     Canadian Collateral Agent shall have no duty to ascertain or inquire as to
     the performance or observance of any of the terms of this Agreement by any
     Canadian Credit Party.

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<Page>

        SECTION 6.02   APPOINTMENT OF CO-AGENT

        At any time or times, in order to comply with any legal requirement in
any jurisdiction, the Canadian Collateral Agent may appoint another bank or
trust company or one or more other persons, either to act as co-agent or
co-agents, jointly with the Canadian Collateral Agent, or to act as separate
agent or agents on behalf of the Finance Parties with such power and authority
as may be necessary for the effectual operation of the provisions hereof and may
be specified in the instrument of appointment (which may, in the discretion of
the Canadian Collateral Agent, include provisions for the protection of such
co-agent or separate agent similar to the provisions of Section 6.01).

                                   ARTICLE VII
                                  MISCELLANEOUS

        SECTION 7.01   NOTICES

        (a)     Unless otherwise expressly provided herein, all notices and
other communications provided for hereunder shall be in writing (including by
facsimile transmission) and mailed, faxed or delivered, to the address,
facsimile number or (subject to SUBSECTION (B) below) electronic mail address
specified for notices: (i) in the case of any Subsidiary Guarantor, as set forth
in Section 5.01 of the Guaranty; (ii) in the case of the Borrowers, the
Administrative Agents or any Lender, as specified in or pursuant to Section
10.01 of the Credit Agreement; (iii) in the case of the Canadian Collateral
Agent, as set forth in the signature pages hereto; (iv) in the case of any
Derivatives Creditor as set forth in any applicable Derivatives Agreement; or
(v) in the case of any party, at such other address as shall be designated by
such party in a notice to the Canadian Collateral Agent and each other party
hereto. All such notices and other communications shall be deemed to be given or
made upon the earlier to occur of: (i) actual receipt by the intended recipient
and (ii)(A) if delivered by hand or by courier, when signed for by the intended
recipient; (B) if delivered by mail, four Business Days after deposit in the
mails, postage prepaid; (C) if delivered by facsimile transmission, when sent
and receipt has been confirmed by telephone; and (D) if delivered by electronic
mail (which form of delivery is subject to the provisions of SUBSECTION (b)
below), when delivered. Rejection or refusal to accept, or the inability to
deliver because of a changed address of which no notice was given, shall not
affect the validity of notice given in accordance with this Section.

        (b)     Except as expressly provided herein or as may be agreed by the
Administrative Agents in their sole discretion, electronic mail and internet and
intranet websites may be used only to distribute routine communications, such as
financial statements and other information, and to distribute Finance Documents
for execution by the parties thereto, to distribute executed Finance Documents
in Adobe PDF format and may not be used for any other purpose.

        SECTION 7.02   NO WAIVERS; NON-EXCLUSIVE REMEDIES

        No failure or delay on the part of the Canadian Collateral Agent or any
Finance Party to exercise, no course of dealing with respect to, and no delay in
exercising, any right, power or privilege under this Agreement or any other
Finance Document or any other document or agreement contemplated hereby or
thereby and no course of dealing between the Canadian Collateral Agent or any
Finance Party and any of the Canadian Credit Parties shall operate as a waiver
thereof nor shall any single or partial exercise of any such right, power or
privilege hereunder or under any Finance Document preclude any other or further
exercise thereof or the exercise of any other right, power or privilege
hereunder or

                                       - -
<Page>

thereunder. The rights and remedies provided herein and in the other Finance
Documents are cumulative and are not exclusive of any other remedies provided by
Law. Without limiting the foregoing, nothing in this Agreement shall impair the
right of any Finance Party to exercise any right of set-off or counterclaim it
may have and to apply the amount subject to such exercise to the payment of
indebtedness of any Canadian Credit Party other than its indebtedness under the
Finance Documents. Each Canadian Credit Party agrees, to the fullest extent it
may effectively do so under applicable Law, that any holder of a participation
in a Finance Obligation, whether or not acquired pursuant to the terms of any
applicable Finance Document, may exercise rights of set-off or counterclaim or
other rights with respect to such participation as fully as if such holder of a
participation were a direct creditor of the Canadian Credit Party in the amount
of such participation.

        SECTION 7.03   COMPENSATION AND EXPENSES OF THE CANADIAN COLLATERAL
AGENT; INDEMNIFICATION.

        (a)     EXPENSES. The Canadian Credit Parties, jointly and severally,
agree (i) to pay or reimburse the Canadian Collateral Agent for all
out-of-pocket costs and expenses incurred in connection with the preparation,
negotiation and execution of this Agreement and any amendment, waiver, consent
or other modification of the provisions hereof (whether or not the transactions
contemplated hereby are consummated), and the consummation of the transactions
contemplated hereby, including all fees, disbursements and other charges of
Fried, Frank, Harris, Shriver & Jacobson LLP, the U.S. counsel for the Canadian
Collateral Agent and McCarthy Tetrault LLP, the Canadian counsel for the
Canadian Collateral Agent, (ii) to pay or reimburse the Canadian Collateral
Agent and the other Finance Parties for all taxes which the Canadian Collateral
Agent or any Finance Party may be required to pay by reason of the security
interests granted in the Collateral (including any applicable transfer taxes) or
to free any of the Collateral from the lien thereof and (iii) to pay or
reimburse each Agent, any Representative of one or more Derivatives Creditors
and each other Finance Party for all reasonable costs and expenses incurred in
connection with the enforcement, attempted enforcement or preservation of any
rights and remedies under this Agreement (including all such costs and expenses
incurred during any "workout" or restructuring in respect of the Finance
Obligations and during any legal proceeding, including any proceeding under any
bankruptcy or insolvency proceeding), including all reasonable fees and
disbursements of counsel (including the allocated charges of internal counsel).
The foregoing costs and expenses shall include all search, filing, recording,
title insurance and appraisal charges and fees and taxes related thereto, and
other out-of-pocket expenses incurred by any Agent and the costs of independent
public accountants and other outside experts retained by or on behalf of the
Agents and the Finance Parties. The agreements in this Section 7.03(a) shall
survive the termination of the Commitments and Derivatives Agreements and
repayment of all Finance Obligations.

        (b)     PROTECTION OF COLLATERAL. If any Canadian Credit Party fails to
comply with the provisions of any Finance Document, such that the value of any
Collateral or the validity, perfection, rank or value of any Security Interest
is thereby diminished or potentially diminished or put at risk, the Canadian
Collateral Agent may, but shall not be required to, effect such compliance on
behalf of such Canadian Credit Party, and the Canadian Credit Parties shall
reimburse the Canadian Collateral Agent for the costs thereof on demand. All
insurance expenses and all expenses of protecting, storing, warehousing,
appraising, handling, maintaining and shipping the Collateral, any and all
excise, property, sales and use taxes imposed by any provincial, federal or
local authority on any of the Collateral, or in respect of periodic appraisals
and inspections of the Collateral (as permitted by the Credit Agreement), or in
respect of the sale or other disposition thereof shall be borne and paid by the
Canadian Credit Parties. If any Canadian Credit Party fails to promptly pay any
portion thereof when due, the Canadian Collateral Agent

                                       - -
<Page>

may, at its option, but shall not be required to, pay the same and charge the
Canadian Credit Parties' account therefor, and the Canadian Credit Parties agree
to reimburse the Canadian Collateral Agent therefor on demand. All sums so paid
or incurred by the Canadian Collateral Agent for any of the foregoing and any
and all other sums for which any Canadian Credit Party may become liable
hereunder and all costs and expenses (including attorneys' fees, legal expenses
and court costs) reasonably incurred by the Canadian Collateral Agent or any
Finance Party in enforcing or protecting the Security Interests or any of their
rights or remedies under this Agreement, shall, together with interest thereon
until paid at the Base Rate (expressed as a rate per annum in accordance with
Section 2.15(c) of the Credit Agreement) applicable to Canadian Revolving Base
Rate Loans plus 2% per annum, be additional Finance Obligations hereunder.

        (c)     INDEMNIFICATION. Whether or not the transactions contemplated
hereby or by the other Finance Documents are consummated, each Canadian Credit
Party, jointly and severally, agrees to indemnify, save and hold harmless each
Indemnitee from and against: (i) any and all claims, demands, actions or causes
of action that may at any time (including at any time following repayment of the
Finance Obligations and the resignation or removal of any Agent or
Representative or the replacement of any Lender) be asserted or imposed against
any Indemnitee, arising out of or in any way relating to or arising out of the
manufacture, ownership, ordering, purchasing, delivery, control, acceptance,
lease, financing, possession, operation, condition, sale, return or other
disposition or use of the Collateral (including, without limitation, latent or
other defects, whether or not discoverable), the violation of the Laws of any
country, state or other Governmental Authority, or any tort (including, without
limitation, any claims, arising or imposed under the doctrine of strict
liability, or for or on account of injury to or the death of any Person
(including any Indemnitee), or property damage) or contract claim;; (ii) any
administrative or investigative proceeding by any Governmental Authority arising
out of or related to a claim, demand, action or cause of action described in
CLAUSE (I) above; and (iii) any and all liabilities (including liabilities under
indemnities), losses, costs or expenses (including fees and disbursements of
counsel) that any Indemnitee suffers or incurs as a result of the assertion of
any foregoing claim, demand, action or cause of action or proceeding, or as a
result of the preparation of any defense in connection with any foregoing claim,
demand, action or cause of action or proceeding, in all cases, and whether or
not an Indemnitee is a party to such claim, demand, action or cause of action,
or proceeding; PROVIDED that no Indemnitee shall be entitled to indemnification
for any claim to the extent such claim is determined by a court of competent
jurisdiction in a final non-appealable judgment to have been caused by its own
gross negligence or willful misconduct; and PROVIDED FURTHER that the Canadian
Credit Parties shall not be required to reimburse the legal fees and expenses of
more than one outside counsel (in addition to up to one local counsel in each
applicable local jurisdiction) for all Indemnitees unless, in the written
opinion of outside counsel reasonably satisfactory to the Canadian Credit
Parties and the Canadian Collateral Agent, representation of all such
Indemnitees would be inappropriate due to the existence of an actual or
potential conflict of interest. In the case of an investigation, litigation or
other proceeding to which the indemnity in this Section 7.03(b) applies, such
indemnity shall be effective whether or not such investigation, litigation or
proceeding is brought by any Canadian Credit Party, its directors, shareholders
or creditors or an Indemnitee or any other Person or any Indemnitee is otherwise
a party thereto and whether or not the transactions contemplated hereby are
consummated. Without prejudice to the survival of any other agreement of the
Canadian Credit Parties hereunder and under the other Finance Documents, the
agreements and obligations of the Canadian Credit Parties contained in this
Section 7.03(b) shall survive the repayment of the Loans, LC Obligations, BA
Reimbursement Obligations and other obligations under the Finance Documents and
the termination of the Commitments. Any amounts paid by any Indemnitee as to
which such Indemnitee has a right to reimbursement hereunder shall constitute
Finance Obligations.

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<Page>

        (d)     CONTRIBUTION. If and to the extent that the obligations of any
Canadian Credit Party under this Section 7.03 are unenforceable for any reason,
each Canadian Credit Party hereby agrees to make the maximum contribution to the
payment and satisfaction of such obligations which is permissible under
applicable Law.

        SECTION 7.04   ENFORCEMENT

        The Finance Parties agree that this Agreement may be enforced only by
the action of the Canadian Collateral Agent, acting upon the instructions of the
Required Lenders (or, after the date on which all Senior Obligations have been
paid in full and all Commitments with respect thereto terminated, the holders of
at least 51% of the outstanding Derivatives Obligations) and that no other
Finance Party shall have any right individually to seek to enforce this
Agreement or to realize upon the security to be granted hereby, it being
understood and agreed that such rights and remedies may be exercised by the
Canadian Collateral Agent or the holders of at least 51% of the outstanding
Derivatives Obligations, as the case may be, for the benefit of the Finance
Parties upon the terms of this Agreement and the other Finance Documents.

        SECTION 7.05   AMENDMENTS AND WAIVERS

        Any provision of this Agreement may be amended, changed, discharged,
terminated or waived if, but only if, such amendment or waiver is in writing and
is signed by each Canadian Credit Party directly affected by such amendment,
change, discharge, termination or waiver (it being understood that the addition
or release of any Canadian Credit Party hereunder shall not constitute an
amendment, change, discharge, termination or waiver affecting any Canadian
Credit Party other than the Canadian Credit Party so added or released) and
either (i) the Canadian Collateral Agent (with the consent of the Required
Lenders or, to the extent required by Section 10.06 of the Credit Agreement, all
or other required percentage of the Lenders), at all times prior to the time on
which all Finance Obligations have been paid in full and all Commitments with
respect thereto have been terminated or (ii) the holders of at least 51% of all
Derivatives Obligations then outstanding, at all times after the time at which
the Finance Obligations have been paid in full and all Commitments with respect
thereto have been terminated; PROVIDED, HOWEVER, that no such amendment, change,
discharge, termination or waiver shall be made to Section 5.04 hereof or this
Section 7.05 without the consent of each Finance Party adversely affected
thereby; and PROVIDED further that any amendment, change, discharge, termination
or waiver adversely affecting the rights and benefits of a single Class of
Finance Parties (and not all Finance Parties in a like or similar manner) shall
require the written consent of the Required Finance Parties of such Class of
Finance Parties. For the purposes of this Section 7.05, the term "CLASS" means
each class of Finance Parties, i.e., whether (x) the Lenders, as holders of the
Senior Obligations or (y) the Derivatives Creditors, as holders of the
Derivatives Obligations. For the purposes of this Section 7.05, the term
"REQUIRED FINANCE PARTIES" of any Class means each of (x) with respect to the
Senior Obligations, the Required Lenders (as defined in the Senior Credit
Agreement), (y) with respect to the Derivatives Obligations, the holders of 51%
of all Derivatives Obligations outstanding from time to time.

        SECTION 7.06   SUCCESSORS AND ASSIGNS

        This Agreement shall be binding upon each of the parties hereto and
inure to the benefit of the Canadian Collateral Agent and the Finance Parties
and their respective successors and assigns. In the event of an assignment of
all or any of the Finance Obligations, the rights hereunder, to the extent
applicable to the indebtedness so assigned, may be transferred with such
indebtedness. No Canadian

                                       - -
<Page>

Credit Party shall assign or delegate any of its rights and duties hereunder
without the prior written consent of the Required Lenders or all of the Lenders
as provided in Section 10.03 of the Credit Agreement.

        SECTION 7.07   GOVERNING LAW

        This Agreement shall be governed by and construed in accordance with the
laws of the Province of Ontario and the laws of Canada applicable therein.

        SECTION 7.08   LIMITATION OF LAW; SEVERABILITY.

                (i)    All rights, remedies and powers provided in this
     Agreement may be exercised only to the extent that the exercise thereof
     does not violate any applicable provision of Law, and all the provisions of
     this Agreement are intended to be subject to all applicable mandatory
     provisions of Law which may be controlling and be limited to the extent
     necessary so that they will not render this Agreement invalid,
     unenforceable in whole or in part, or not entitled to be recorded,
     registered or filed under the provisions of any applicable Law.

                (ii)   If any provision hereof is invalid or unenforceable in
     any jurisdiction, then, to the fullest extent permitted by Law, (i) the
     other provisions hereof shall remain in full force and effect in such
     jurisdiction and shall be liberally construed in favor of the Canadian
     Collateral Agent and the Finance Parties in order to carry out the
     intentions of the parties hereto as nearly as may be possible, and (ii) the
     invalidity or unenforceability of any provision hereof in any jurisdiction
     shall not affect the validity or enforceability of such provisions in any
     other jurisdiction.

        SECTION 7.09   COUNTERPARTS; EFFECTIVENESS

        This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument. This Agreement shall become effective
with respect to each Canadian Credit Party when the Canadian Collateral Agent
shall receive counterparts hereof executed by itself and such Canadian Credit
Party.

        SECTION 7.10   ADDITIONAL CANADIAN CREDIT PARTIES

        It is understood and agreed that any Affiliate of any Borrower that is
required by any Finance Document to execute a counterpart of this Agreement
after the date hereof shall automatically become a Canadian Credit Party
hereunder with the same force and effect as if originally named as a Canadian
Credit Party hereunder by executing an instrument of accession or joinder
satisfactory in form and substance to the Canadian Collateral Agent and
delivering the same to the Canadian Collateral Agent. Concurrently with the
execution and delivery of such instrument, such Affiliate shall take all such
actions and deliver to the Canadian Collateral Agent all such documents and
agreements as such Affiliate would have been required to deliver to the Canadian
Collateral Agent on or prior to the date of this Agreement had such Affiliate
been a party hereto on the date of this Agreement. Such additional materials
shall include, among other things, supplements to SCHEDULES 3.05 and 4.01 hereto
(which Schedules shall thereupon automatically be amended and supplemented to
include all information contained in such supplements) such that, after giving
effect to the joinder of such Affiliate, each of SCHEDULES 3.05 and 4.01 hereto
is true, complete and correct with respect to such Affiliate as of the effective
date of such

                                       - -
<Page>

joinder. The execution and delivery of any such instrument of accession or
joinder, and the amendment and supplementation of the Schedules hereto as
provided in the immediately preceding sentence, shall not require the consent of
any other Canadian Credit Party hereunder. The rights and obligations of each
Canadian Credit Party hereunder shall remain in full force and effect
notwithstanding the addition of any new Canadian Credit Party as a party to this
Agreement.

        SECTION 7.11   TERMINATION

        Upon the full, final and irrevocable payment and performance of all
Finance Obligations, the cancellation or expiration of all outstanding LC
Obligations, BA Reimbursement Obligations and Derivatives Agreements and the
termination of all Commitments under the Finance Documents, the Security
Interests shall terminate and all rights to the Collateral shall revert to the
Canadian Credit Parties. In addition, at any time and from time to time prior to
such termination of the Security Interests, the Canadian Collateral Agent may
release any of the Collateral with the prior written consent of the Required
Lenders; PROVIDED that the release of all or substantially all of the Collateral
shall require the consent of all of the Lenders. Upon any such termination of
the Security Interests or release of Collateral, the Canadian Collateral Agent
will, upon request by and at the expense of any Canadian Credit Party, execute
and deliver to such Canadian Credit Party such documents as such Canadian Credit
Party shall reasonably request to evidence the termination of the Security
Interests or the release of such Collateral, as the case may be. Any such
documents shall be without recourse to or warranty by the Canadian Collateral
Agent or the Finance Parties. The Canadian Collateral Agent shall have no
liability whatsoever to any Finance Party as a result of any release of
Collateral by it as permitted by this Section 7.11. Upon any release of
Collateral pursuant to this Section 7.11, none of the Finance Parties shall have
any continuing right or interest in such Collateral or the Proceeds thereof.

        SECTION 7.12   ENTIRE AGREEMENT

        This Agreement and the other Finance Documents and, in the case of the
Derivatives Creditors, the Derivatives Agreements, constitute the entire
agreement and understanding among the parties hereto and supersede any and all
prior agreements and understandings, oral or written, and any contemporaneous
oral agreements and understandings relating to the subject matter hereof and
thereof.

        SECTION 7.13   CONFLICT

        To the extent that there is a conflict or inconsistency between any
provision hereof, on the one hand, and any provision of the Credit Agreement, on
the other hand, the Credit Agreement shall control.

                            [Signature Pages Follow]

                                       - -
<Page>

        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first written above.

CANADIAN CREDIT PARTIES:                    THE JEAN COUTU GROUP (PJC) INC.

                                            By:
                                               ------------------------------
                                               Name:
                                               Title:

                                            SERVICES SECURIVOL INC.

                                            By:
                                               ------------------------------
                                               Name:
                                               Title:

                                            RX INFORMATION CENTRE LTD.

                                            By:
                                               ------------------------------
                                               Name:
                                               Title:

                                            PATERSON'S PHARMACIES LIMITED

                                            By:
                                               ------------------------------
                                               Name:
                                               Title:

                                            3090671 NOVA SCOTIA COMPANY

                                            By:
                                               ------------------------------
                                               Name:
                                               Title:

                                            3090672 NOVA SCOTIA COMPANY

                                            By:
                                               ------------------------------
                                               Name:
                                               Title:

                                       S-
<Page>

COLLATERAL AGENT:                           NATIONAL BANK OF CANADA
                                               as Canadian Collateral Agent

                                            By:
                                               ------------------------------
                                               Name:
                                               Title:

                                            1155 Metcalfe Street, 5th Floor
                                            Montreal, Quebec H3B 4S9
                                            Attention: Syndication Canada
                                            Telecopier: (514) 390-7860

                                       S-<Page>

                                                                    Exhibit 10.6

                                                                  EXECUTION COPY

                                PLEDGE AGREEMENT

                            DATED AS OF JULY 30, 2004

                                      AMONG

                THE CREDIT PARTIES FROM TIME TO TIME PARTY HERETO

                                       AND

                      DEUTSCHE BANK TRUST COMPANY AMERICAS,
                            AS U.S. COLLATERAL AGENT

<Page>

                               TABLE OF CONTENTS*

<Table>
<Caption>
                                                                                        PAGE
                                                                                        ----
<S>                  <C>                                                                  <C>
                                    ARTICLE I
                                   DEFINITIONS

Section 1.01         Terms Defined in the Finance Documents................................2
Section 1.02         Terms Defined in the UCC..............................................2
Section 1.03         Additional Definitions................................................2
Section 1.04         Terms Generally.......................................................8

                                   ARTICLE II
                             THE SECURITY INTERESTS

Section 2.01         Grant of Security Interests...........................................8
Section 2.02         Security Interests Absolute...........................................9
Section 2.03         Continuing Liability of the Credit Parties...........................10

                                   ARTICLE III
                         REPRESENTATIONS AND WARRANTIES

Section 3.01         Title to Collateral..................................................11
Section 3.02         Validity, Perfection and Priority of Security Interests..............11
Section 3.03         Collateral...........................................................11
Section 3.04         No Consents..........................................................12

                                   ARTICLE IV
                                    COVENANTS

Section 4.01         Delivery of Collateral...............................................12
Section 4.02         Delivery of Perfection Certificate; Filing of Financing Statements
                     and Delivery of Search Reports.......................................12
Section 4.03         Change of Name, Identity, Structure or Location; Subjection to Other
                     Security Agreements..................................................13
Section 4.04         Further Actions......................................................13
Section 4.05         Disposition of Collateral............................................13
Section 4.06         Additional Collateral................................................13
Section 4.07         Information Regarding Collateral.....................................14

                                    ARTICLE V
                       DISTRIBUTIONS ON COLLATERAL; VOTING

Section 5.01         Right to Receive Distributions on Collateral; Voting.................14

                                   ARTICLE VI
                           GENERAL AUTHORITY; REMEDIES

Section 6.01         General Authority....................................................16
</Table>

----------
*    The Table of Contents is not a part of the Pledge Agreement.

<Page>

                            TABLE OF CONTENTS (CONT.)

<Table>
<Caption>
                                                                                        PAGE
                                                                                        ----
<S>                  <C>                                                                  <C>
Section 6.02         Remedies upon Event of Default.......................................16
Section 6.03         Securities Act; Registration Rights..................................18
Section 6.04         Other Rights of the U.S. Collateral Agent............................19
Section 6.05         Limitation on Duty of U.S. Collateral Agent in Respect of
                     Collateral...........................................................20
Section 6.06         Waiver and Estoppel..................................................20
Section 6.07         Application of Proceeds..............................................21

                                   ARTICLE VII
                            THE U.S. COLLATERAL AGENT

Section 7.01         Concerning the U.S. Collateral Agent.................................22
Section 7.02         Appointment of Co-Collateral Agent...................................22
Section 7.03         Appointment of Sub-Agents............................................22

                                  ARTICLE VIII
                                  MISCELLANEOUS

Section 8.01         Notices..............................................................22
Section 8.02         No Waivers; Non-Exclusive Remedies...................................23
Section 8.03         Compensation and Expenses of the U.S. Collateral Agent;
                     Indemnification......................................................23
Section 8.04         Enforcement..........................................................25
Section 8.05         Amendments and Waivers...............................................25
Section 8.06         Successors and Assigns...............................................25
Section 8.07         Governing Law........................................................26
Section 8.08         Limitation of Law; Severability......................................26
Section 8.09         Counterparts; Effectiveness..........................................26
Section 8.10         Additional Credit Parties............................................26
Section 8.11         Termination; Release of Credit Parties...............................27
Section 8.12         Entire Agreement.....................................................27
Section 8.13         Defined Terms; Conflict..............................................27
</Table>

SCHEDULES:
     Schedule I   -  List of Pledged Shares
     Schedule II  -  List of Pledged Notes
     Schedule III -  List of Pledged LLC Interests
     Schedule IV  -  List of Pledged Partnership Interests
     Schedule V   -  Schedule of Filings to Perfect Security Interests

EXHIBITS:

     Exhibit A    -  Form of Issuer Control Agreement
     Exhibit B    -  Form of Securities Account Control Agreement

                                      -ii-
<Page>

                      PLEDGE AGREEMENT dated as of July 30, 2004 (as amended,
                modified or supplemented from time to time, this "AGREEMENT")
                among the CREDIT PARTIES from time to time party hereto and
                DEUTSCHE BANK TRUST COMPANY AMERICAS, as U.S. Collateral Agent
                for benefit of the Finance Parties referred to herein.

                THE JEAN COUTU GROUP (PJC) INC., a corporation formed and
existing under the laws of the Province of Quebec (together with its successors
and permitted assigns, the "PARENT BORROWER"), proposes to enter into a Credit
Agreement dated as of July 30, 2004 (as amended, restated, modified or
supplemented from time to time and including any agreement extending the
maturity of, refinancing or otherwise restructuring all or any portion of the
obligations of the Parent Borrower under such agreement or any successor
agreement, the "CREDIT AGREEMENT") among the Parent Borrower, THE JEAN COUTU
GROUP (PJC) USA, INC., a corporation formed and existing under the laws of the
State of Delaware (the "U.S. BORROWER" and, together with the Parent Borrower,
the "BORROWERS"), the banks and other financial institutions form time to time
party hereto (the "LENDERS"), MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED, as Global Transaction Coordinator, DEUTSCHE BANK SECURITIES INC.,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and NATIONAL BANK FINANCIAL
INC., as U.S. Joint Lead Arrangers, DEUTSCHE BANK SECURITIES INC. and MERRILL
LYNCH, PIERCE, FENNER & SMITH INCORPORATED, as U.S. Joint Bookrunners, NATIONAL
BANK FINANCIAL INC., MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and
DEUTSCHE BANK SECURITIES INC., as Canadian Joint Lead Arrangers and as Canadian
Joint Bookrunners, NATIONAL BANK OF CANADA, as the Canadian Administrative
Agent, DEUTSCHE BANK TRUST COMPANY AMERICAS, as the Term B Administrative Agent,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED and NATIONAL BANK OF CANADA,
as U.S. Co-Syndication Agents, MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED and DEUTSCHE BANK SECURITIES INC., as Canadian Co-Syndication
Agents.

                Certain Lenders and their affiliates acting as Derivatives
Creditors (as defined in the Credit Agreement) may from time to time provide
forward rate agreements, options, swaps, caps, floors and other Derivatives
Agreements (as defined in the Credit Agreement) to the Credit Parties (as
defined below). The Lenders, each Issuing Lender, each Swingline Lender, the
Administrative Agents, the Co-Syndication Agents, the Global Transaction
Coordinator, the U.S. Joint Lead Arrangers, the Canadian Joint Lead Arrangers,
the Canadian Collateral Agent, the U.S. Collateral Agent, as collateral agent
for the benefit of the Lenders (together with its successor or successors in
such capacity, the "U.S. COLLATERAL AGENT"), each Indemnitee and each
Derivatives Creditor and their respective successors and assigns are herein
referred to individually as a "FINANCE PARTY" and collectively as the "FINANCE
PARTIES".

                To induce the Lenders to enter into the Credit Agreement and the
other Senior Finance Documents (as defined in the Credit Agreement) and the
Derivatives Creditors to enter into the Derivatives Agreements constituting
Finance Documents under the Credit Agreement (collectively with the Senior
Finance Documents and the Derivatives Agreements evidencing Derivatives
Obligations (as hereinafter defined) permitted under the Credit Agreement, the
"FINANCE DOCUMENTS"), and as a condition precedent to the obligations of the
Finance Parties thereunder, the Parent Borrower and certain of its subsidiaries
(each a "GUARANTOR" and, collectively, the "GUARANTORS") have agreed, jointly
and severally, to provide a guaranty of all obligations of the Borrowers and the
other Credit Parties under or in respect of the Finance Documents.

As a further condition precedent to the obligations of the Lenders and the
Derivatives Creditors under the Senior Finance Documents, each Borrower and each
Subsidiary Guarantor (each a "CREDIT PARTY" and, together with each other person
that becomes a party hereto pursuant to SECTION 7.10 hereof and the respective
successors and permitted assigns of each of the foregoing, the "CREDIT PARTIES")
has agreed or

<Page>

will agree to grant a continuing security interest in favor of the U.S.
Collateral Agent in and to the Collateral (as hereinafter defined) to secure the
Finance Obligations (as defined in the Credit Agreement). Accordingly, the
parties hereto agree as follows:

                                    ARTICLE I
                                   DEFINITIONS

                SECTION 1.01     TERMS DEFINED IN THE FINANCE DOCUMENTS.
Capitalized terms defined in the Credit Agreement and not otherwise defined
herein have, as used herein, the respective meanings provided for therein.

                SECTION 1.02     TERMS DEFINED IN THE UCC. Unless otherwise
defined herein or in the Credit Agreement or the context otherwise requires, the
following terms, together with any uncapitalized terms used herein which are
defined in the UCC (as defined below), have the respective meanings provided in
the UCC: (i) Certificated Security; (ii) Financial Asset; (iii) Investment
Property; (iv) Payment Intangibles; (v) Proceeds; (vi) Securities Account; (vii)
Securities Intermediary; (viii) Security; (ix) Security Certificate; and (x)
Uncertificated Security; and (xi) Security Entitlement.

                SECTION 1.03     ADDITIONAL DEFINITIONS. Terms defined in the
introductory section hereof have the respective meanings set forth therein. The
following additional terms, as used herein, have the following respective
meanings:

                "ACCOUNT CONTROL AGREEMENT" means (i) with respect to a Deposit
Account, a deposit account control agreement, substantially in the form of
EXHIBIT C to the U.S. Security Agreement or otherwise containing substantially
similar terms and acceptable in form and substance to the U.S. Collateral Agent,
among one or more Credit Parties, the U.S. Collateral Agent and the bank which
maintains such Deposit Account and (ii) with respect to a Securities Account, a
securities account control agreement, substantially in the form of EXHIBIT B
hereto or otherwise containing substantially similar terms and acceptable in
form and substance to the U.S. Collateral Agent, among one or more Credit
Parties, the U.S. Collateral Agent and the Securities Intermediary which
maintains such Securities Account, in each case as the same may be amended,
restated, modified or supplemented from time to time.

                "COLLATERAL" has the meaning set forth in SECTION 2.01 of this
Agreement.

                "CREDIT PARTY" means each of the Borrowers and each Subsidiary
Guarantor, and "Credit Parties" means all of them, collectively.

                "DELIVERY" and the corresponding term "DELIVERED" when used with
respect to Collateral means:

                        (i)      in the case of Collateral constituting
        Certificated Securities, transfer thereof to the U.S. Collateral Agent
        or its nominee or custodian by physical delivery to the U.S. Collateral
        Agent or its nominee or custodian, such Collateral to be in suitable
        form for transfer by delivery, or accompanied by undated instruments of
        transfer or assignment duly executed in blank, with signatures
        appropriately guaranteed;

                        (ii)     in the case of Collateral constituting
        Uncertificated Securities, (A) registration thereof on the books and
        records of the issuer thereof in the name of the U.S. Collateral Agent
        or its nominee or custodian (who may not be a Securities Intermediary)
        or (B) the execution and delivery by the issuer thereof of an effective
        agreement, substantially in the

                                       -2-
<Page>

        form of EXHIBIT A hereto, pursuant to which such issuer agrees that it
        will comply with instructions originated by the U.S. Collateral Agent or
        such nominee or custodian without further consent of the registered
        owner of such Collateral or any other Person;

                        (iii)    in the case of Collateral constituting Security
        Entitlements or other Financial Assets deposited in or credited to a
        Securities Account, (A) completion of all actions necessary to
        constitute the U.S. Collateral Agent or its nominee or custodian the
        entitlement holder with respect to each such Security Entitlement or (B)
        the execution and delivery by the relevant Securities Intermediary of an
        effective Account Control Agreement pursuant to which such Securities
        Intermediary agrees to comply with all entitlement orders originated by
        the U.S. Collateral Agent or such nominee or custodian without further
        consent by the relevant entitlement holder or any other Person;

                        (iv)     in the case of LLC Interests and Partnership
        Interests which do not constitute Securities, (A) compliance with the
        provisions of CLAUSE (i) above for each such item of Collateral which is
        represented by a certificate and (B) compliance with the provisions of
        CLAUSE (ii) above for each such item of Collateral which is not
        evidenced by a certificate;

                        (v)      in the case of Collateral which constitute
        Instruments, transfer thereof to the U.S. Collateral Agent or its
        nominee or custodian by physical delivery to the U.S. Collateral Agent
        or its nominee or custodian indorsed to, or registered in the name of,
        the U.S. Collateral Agent or its nominee or custodian or indorsed in
        blank;

                        (vi)     in the case of cash, transfer thereof to the
        U.S. Collateral Agent or its nominee or custodian by physical delivery
        to the U.S. Collateral Agent or its nominee or custodian; and

                        (vii)    in each case such additional or alternative
        procedures as may hereafter become appropriate to grant control of, or
        otherwise perfect a security interest in, any Collateral in favor of the
        U.S. Collateral Agent or its nominee or custodian, consistent with
        changes in applicable Law or regulations or the interpretation thereof.

                "DERIVATIVES OBLIGATIONS" of any Person means all obligations
(including, without limitation, any amounts which accrue after the commencement
of any bankruptcy or insolvency proceeding with respect to such Person, whether
or not allowed or allowable as a claim under any bankruptcy or insolvency
proceeding) of such Person in respect of any Derivatives Agreement, excluding
any amounts which such Person is entitled to set-off against its obligations
under applicable Law.

                "FINANCE OBLIGATIONS" means:

                        (i)      all Senior Obligations; and

                        (ii)     all Derivatives Obligations permitted under the
        Credit Agreement owed or owing to any Derivatives Creditor.

in each case whether now or hereafter due, owing or incurred in any manner,
whether actual or contingent, whether incurred solely or jointly with any other
Person and whether as principal or surety (and including all liabilities in
connection with any notes, bills or other instruments accepted by any Finance
Party in connection therewith), together in each case with all renewals,
modifications, consolidations or extensions thereof.

                                       -3-
<Page>

                "GENERAL INTANGIBLES" means all "general intangibles" (as
defined in the UCC), including, without limitation, (i) all Payment Intangibles
and other obligations and indebtedness owing to any Credit Party in respect of
Collateral and (ii) all interests in limited liability companies and/or
partnerships which interests do not constitute Securities.

                "INSTRUMENTS" means:

                        (i)      the promissory notes described on SCHEDULE II
        hereto, as such Schedule may be amended, supplemented or modified from
        time to time (the "PLEDGED NOTES"), and all interest, distributions,
        cash, instruments and other property, income, profits and proceeds from
        time to time received or receivable or otherwise made upon or
        distributed in respect of or in exchange for any or all of the Pledged
        Notes;

                        (ii)     all additional or substitute promissory notes
        from time to time issued to or otherwise acquired by any Credit Party in
        any manner in respect of Pledged Notes or otherwise, and all interest,
        distributions, cash, instruments and other property, income, profits and
        proceeds from time to time received or receivable or otherwise made upon
        or distributed in respect of such additional or substitute notes;

                        (iii)    all promissory notes, bankers' acceptances,
        commercial paper, negotiable certificates of deposit and other
        obligations constituting "instruments" within the meaning of the UCC;
        and

to the extent not otherwise included in the foregoing, all cash and non-cash
Proceeds thereof.

                "LLC INTERESTS" means:

                        (i)      the limited liability company membership
        interests described on SCHEDULE III hereto, as such Schedule may be
        amended, supplemented or modified from time to time (the "PLEDGED LLC
        INTERESTS"), and all dividends, distributions, cash, instruments and
        other property, income, profits and proceeds from time to time received
        or receivable or otherwise made upon or distributed in respect of or in
        exchange for any or all of the Pledged LLC Interests;

                        (ii)     all additional or substitute limited liability
        company membership interests from time to time issued to or otherwise
        acquired by any Credit Party in any manner in respect of Pledged LLC
        Interests or otherwise, and all dividends, distributions, cash,
        instruments and other property, income, profits and proceeds from time
        to time received or receivable or otherwise made upon or distributed in
        respect of such additional or substitute membership interests;

                        (iii)    all right, title and interest of any Credit
        Party in each limited liability company to which any Pledged LLC
        Interest relates, including, without limitation:

                                 (A)   all interests of such Credit Party in the
                capital of such limited liability company and in all profits,
                losses and assets, whether tangible or intangible and whether
                real, personal or mixed, of such limited liability company, and
                all other distributions to which such Credit Party shall at any
                time be entitled in respect of such Pledged LLC Interests;

                                 (B)   all other payments due or to become due
                to such Credit Party in respect of Pledged LLC Interests,
                whether under any limited liability company agreement

                                       -4-
<Page>

                or operating agreement or otherwise and whether as contractual
                obligations, damages, insurance proceeds or otherwise;

                                 (C)   all of such Credit Party's claims,
                rights, powers, privileges, authority, options, security
                interests, liens and remedies, if any, under any limited
                liability company agreement or operating agreement, or at Law or
                otherwise in respect of such Pledged LLC Interests;

                                 (D)   all present and future claims, if any, of
                such Credit Party against any such limited liability company for
                moneys loaned or advanced, for services rendered or otherwise;
                and

                                 (E)   all of such Credit Party's rights under
                any limited liability company agreement or operating agreement
                or at Law to exercise and enforce every right, power, remedy,
                authority, option and privilege of such Credit Party relating to
                such Pledged LLC Interests, including any power to terminate,
                cancel or modify any limited liability company agreement or
                operating agreement, to execute any instruments and to take any
                and all other action on behalf of and in the name of such Credit
                Party in respect of such Pledged LLC Interests and any such
                limited liability company, to make determinations, to exercise
                any election (including, without limitation, election of
                remedies) or option to give or receive any notice, consent,
                amendment, waiver or approval, together with full power and
                authority to demand, receive, enforce, collect or give receipt
                for any of the foregoing or for any assets of any such limited
                liability company, to enforce or execute any checks or other
                instruments or orders, to file any claims and to take any other
                action in connection with any of the foregoing; and

to the extent not otherwise included in the foregoing, all cash and non-cash
Proceeds thereof.

                "PARTNERSHIP INTERESTS" means:

                        (i)      the partnership interests described on SCHEDULE
        IV hereto, as such Schedule may be amended, supplemented or modified
        from time to time (the "PLEDGED PARTNERSHIP INTERESTS"), and all
        dividends, distributions, cash, instruments and other property, income,
        profits and proceeds from time to time received or receivable or
        otherwise made upon or distributed in respect of or in exchange for any
        or all of the Pledged Partnership Interests;

                        (ii)     all additional or substitute partnership
        interests from time to time issued to or otherwise acquired by any
        Credit Party in any manner in respect of Pledged Partnership Interests
        or otherwise, and all dividends, distributions, cash, instruments and
        other property, income, profits and proceeds from time to time received
        or receivable or otherwise made upon or distributed in respect of such
        additional or substitute partnership interests;

                        (iii)    all right, title and interest of any Credit
        Party in each partnership to which any Pledged Partnership Interest
        relates, including, without limitation:

                                 (A)   all interests of such Credit Party in the
                capital of such partnership and in all profits, losses and
                assets, whether tangible or intangible and whether real,
                personal or mixed, of such partnership, and all other
                distributions to which such Credit Party shall at any time be
                entitled in respect of such Pledged Partnership Interests;

                                       -5-
<Page>

                                 (B)   all other payments due or to become due
                to such Credit Party in respect of Pledged Partnership
                Interests, whether under any partnership agreement or otherwise
                and whether as contractual obligations, damages, insurance
                proceeds or otherwise;

                                 (C)   all of such Credit Party's claims,
                rights, powers, privileges, authority, options, security
                interests, liens and remedies, if any, under any partnership
                agreement, or at Law or otherwise in respect of such Pledged
                Partnership Interests;

                                 (D)   all present and future claims, if any, of
                such Credit Party against any such partnership for moneys loaned
                or advanced, for services rendered or otherwise; and

                                 (E)   all of such Credit Party's rights under
                any partnership agreement or at Law to exercise and enforce
                every right, power, remedy, authority, option and privilege of
                such Credit Party relating to such Pledged Partnership
                Interests, including any power to terminate, cancel or modify
                any partnership agreement, to execute any instruments and to
                take any and all other action on behalf of and in the name of
                such Credit Party in respect of such Pledged Partnership
                Interests and any such partnership, to make determinations, to
                exercise any election (including, without limitation, election
                of remedies) or option to give or receive any notice, consent,
                amendment, waiver or approval, together with full power and
                authority to demand, receive, enforce, collect or give receipt
                for any of the foregoing or for any assets of any such
                partnership, to enforce or execute any checks or other
                instruments or orders, to file any claims and to take any other
                action in connection with any of the foregoing; and

to the extent not otherwise included in the foregoing, all cash and non-cash
Proceeds thereof.

                "PERFECTION CERTIFICATE" means a certificate, substantially in
the form of EXHIBIT F-1 to the Credit Agreement, completed and supplemented with
the schedules and attachments contemplated thereby.

                "PERMITTED LIEN" means any Lien referred to in, and permitted
by, SECTION 7.02 of the Credit Agreement.

                "PLEDGE AGREEMENT" means this Agreement, as the same may be
amended, supplemented or modified from time to time.

                "PLEDGED LLC INTERESTS" has the meaning set forth in CLAUSE (i)
of the definition of "LLC Interests".

                "PLEDGED NOTES" has the meaning set forth in CLAUSE (i) of the
definition of "Instruments".

                "PLEDGED PARTNERSHIP INTERESTS" has the meaning set forth in
CLAUSE (i) of the definition of "Partnership Interests".

                "PLEDGED SHARES" has the meaning set forth in CLAUSE (i) of the
definition of "Stock".

                "SECURITY INTERESTS" means the security interests in the
Collateral granted under this Agreement securing the Finance Obligations.

                                       -6-
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                "SECURITIES LAWS" has the meaning set forth in SECTION 6.03(a)
of this Agreement.

                "SENIOR OBLIGATIONS" means with respect to each Credit Party,
without duplication:

                        (i)      in the case of each Borrower, all principal of
        and interest (including, without limitation, any interest which accrues
        after the commencement of any bankruptcy or insolvency proceeding with
        respect to any Credit Party, whether or not allowed or allowable as a
        claim under any bankruptcy or insolvency proceeding) on any Loan made
        to, or LC Obligation under, or BA Reimbursement Obligation, or any Note
        issued pursuant to, the Credit Agreement or any other Senior Finance
        Document;

                        (ii)     all fees, expenses, indemnification
        obligations, foreign currency exchange, obligations, and other amounts
        of whatever nature now or hereafter payable by any Credit Party
        (including, without limitation, any amounts which accrue after the
        commencement of any bankruptcy or insolvency proceeding with respect to
        any Credit Party, whether or not allowed or allowable as a claim under
        any bankruptcy or insolvency proceeding) pursuant to the Credit
        Agreement, this Agreement or any other Senior Finance Document;

                        (iii)    all expenses of any Finance Party as to which
        it has a right to reimbursement under SECTION 8.03(a) or (b) of this
        Agreement or under any other similar provision of any other Senior
        Finance Document, including, without limitation, any and all sums
        advanced by the U.S. Collateral Agent to preserve any Collateral or
        preserve its security interests in any Collateral;

                        (iv)     all amounts paid by any Indemnitee as to which
        such Indemnitee has the right to reimbursement under SECTION 8.03(c) of
        this Agreement, SECTION 10.05 of the Credit Agreement or under any other
        similar provision of any other Senior Finance Document; and

                        (i)      in the case of each Borrower and each
        Subsidiary Guarantor, all amounts now or hereafter payable by such
        Borrower or such Subsidiary Guarantor and all other obligations or
        liabilities now existing or hereafter arising or incurred (including,
        without limitation, any amounts which accrue after the commencement of
        any bankruptcy or insolvency proceeding with respect to any Credit
        Party, whether or not allowed or allowable as a claim under any
        bankruptcy or insolvency proceeding) on the part of the such Borrower or
        such Subsidiary Guarantor pursuant to the Guaranty in respect of the
        Credit Agreement or any other Senior Finance Document;

in each case whether now or hereafter due, owing or incurred in any manner,
whether actual or contingent, whether incurred solely or jointly with any other
Person and whether as principal or surety (and including all liabilities in
connection with any notes, bills or other instruments accepted by any Finance
Party in connection therewith, together in each case with all renewals,
modifications, consolidations or extensions thereof.

                "STOCK" means:

                        (i)      the shares of capital stock and other
        Securities described on SCHEDULE I hereto, as such Schedule may be
        amended, supplemented or modified from time to time (the "PLEDGED
        SHARES"), and all dividends, interest, distributions, cash, instruments
        and other property, income, profits and proceeds from time to time
        received, receivable or otherwise made upon or distributed in respect of
        or in exchange for any or all of the Pledged Shares; and

                                       -7-
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                        (ii)     all additional or substitute shares of capital
        stock or other equity interests of any class of any issuer from time to
        time issued to or otherwise acquired by any Credit Party in any manner
        in respect of Pledged Shares or otherwise, the certificates representing
        such additional or substitute shares, and all dividends, interest,
        distributions, cash, instruments and other property, income, profits and
        proceeds from time to time received, receivable or otherwise made upon
        or distributed in respect of or in exchange for any or all of such
        additional or substitute shares; and

to the extent not otherwise included in the foregoing, all cash and non-cash
Proceeds thereof.

                "UCC" means the Uniform Commercial Code as in effect from time
to time in the State of New York; PROVIDED that if by reason of mandatory
provisions of Law, the perfection, the effect of perfection or non-perfection or
the priority of the Security Interests in any Collateral is governed by the
Uniform Commercial Code or any other Law as in effect in a jurisdiction other
than New York, "UCC" means the Uniform Commercial Code or such other Law as in
effect in such other jurisdiction for purposes of the provisions hereof relating
to such perfection, effect of perfection or non-perfection or priority.

                "U.S. COLLATERAL AGENT" means Deutsche Bank Trust Company
Americas, in its capacity as collateral agent for the Finance Parties, and its
successors or successors in such capacity.

                SECTION 1.04     TERMS GENERALLY. The definitions in SECTIONS
1.02 and 1.03 shall apply equally to both the singular and plural forms of the
terms defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words "include",
"includes" and "including" shall be deemed to be followed by the phrase "without
limitation". All references herein to Articles, Sections, Exhibits and Schedules
shall be deemed references to Articles and Sections of, and Exhibits and
Schedules to, this Agreement unless the context, shall otherwise require. Unless
otherwise expressly provided herein, the word "day" means a calendar day.

                                   ARTICLE II
                             THE SECURITY INTERESTS

                SECTION 2.01     GRANT OF SECURITY INTERESTS. To secure the due
and punctual payment of all Finance Obligations, howsoever created, arising or
evidenced, whether direct or indirect, absolute or contingent, now or hereafter
existing or due or to become due, in accordance with the terms thereof and to
secure the performance of all of the obligations of each Credit Party hereunder
and under the other Finance Documents, each Credit Party hereby grants to the
U.S. Collateral Agent for the benefit of the Finance Parties a security interest
in, and each Credit Party hereby pledges and collaterally assigns to the U.S.
Collateral Agent for the benefit of the Finance Parties, all of such Credit
Party's right, title and interest in, to and under the following, whether now
owned or existing or hereafter acquired, created or arising, whether tangible or
intangible, and regardless of where located (all of which are herein
collectively called the "COLLATERAL"):

                        (i)      Stock;

                        (ii)     Instruments;

                        (iii)    LLC Interests;

                        (iv)     Partnership Interests;

                                       -8-
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                        (v)      Investment Property;

                        (vi)     Financial Assets;

                        (vii)    all General Intangibles; and

                        (viii)   all Proceeds of all or any of the Collateral
        described in CLAUSES (i) through (vi) hereof;

PROVIDED, HOWEVER, that the Collateral shall not include except as otherwise
required by SECTION 6.10(d) of the Credit Agreement, shares of capital stock
having voting power in excess of 65% of the voting power of all classes of
capital stock of a Foreign Subsidiary of any Credit Party if, and solely to the
extent that, the inclusion of such shares of capital stock hereunder would cause
the undistributed earnings of such Foreign Subsidiary as determined for United
States federal income tax purposes to be treated as a deemed repatriation of the
earnings of such Foreign Subsidiary to such Foreign Subsidiary's United States
parent for Untied States federal income tax purposes.

                SECTION 2.02     SECURITY INTERESTS ABSOLUTE. All rights of the
U.S. Collateral Agent, all security interests hereunder and all obligations of
each Credit Party hereunder are unconditional and absolute and independent and
separate from any other security for or guaranty of the Finance Obligations,
whether executed by such Credit Party, any other Credit Party or any other
Person. Without limiting the generality of the foregoing, the obligations of
each Credit Party hereunder shall not be released, discharged or otherwise
affected or impaired by:

                        (i)      any extension, renewal, settlement, compromise,
        acceleration, waiver or release in respect of any obligation of any
        other Credit Party under any Finance Document or any other agreement or
        instrument evidencing or securing any Finance Obligation, by operation
        of Law or otherwise;

                        (ii)     other than pursuant to SECTION 8.05 hereof, any
        change in the manner, place, time or terms of payment of any Finance
        Obligation or any other amendment, supplement or modification to any
        Finance Document or any other agreement or instrument evidencing or
        securing any Finance Obligation;

                        (iii)    any release, non-perfection or invalidity of
        any direct or indirect security for any Finance Obligation, any sale,
        exchange, surrender, realization upon, offset against or other action in
        respect of any direct or indirect security for any Finance Obligation or
        any release of any other obligor or Finance Parties in respect of any
        Finance Obligation;

                        (iv)     any change in the existence, structure or
        ownership of any Credit Party, or any insolvency, bankruptcy,
        reorganization, arrangement, readjustment, composition, liquidation or
        other similar proceeding affecting any Credit Party or its assets or any
        resulting disallowance, release or discharge of all or any portion of
        any Finance Obligation;

                        (v)      the existence of any claim, set-off or other
        right which any Credit Party may have at any time against the Borrowers,
        any other Credit Party, any Agent, any other Finance Party or any other
        Person, whether in connection herewith or any unrelated transaction;
        PROVIDED that nothing herein shall prevent the assertion of any such
        claim by separate suit or compulsory counterclaim;

                                       -9-
<Page>

                        (vi)     any invalidity or unenforceability relating to
        or against the Borrowers or any other Credit Party for any reason of any
        Finance Document or any other agreement or instrument evidencing or
        securing any Finance Obligation or any provision of applicable Law or
        regulation purporting to prohibit the payment by the Borrowers or any
        other Credit Party of any Finance Obligation;

                        (vii)    any failure by any Finance Party: (A) to file
        or enforce a claim against any Credit Party or its estate (in a
        bankruptcy or other proceeding); (B) to give notice of the existence,
        creation or incurrence by any Credit Party of any new or additional
        indebtedness or obligation under or with respect to the Finance
        Obligations; (C) to commence any action against any Credit Party; (D) to
        disclose to any Credit Party any facts which such Finance Party may now
        or hereafter know with regard to any Credit Party; or (E) to proceed
        with due diligence in the collection, protection or realization upon any
        collateral securing the Finance Obligations;

                        (viii)   any direction as to application of payment by
        the Borrowers, any other Credit Party or any other Person;

                        (ix)     any subordination by any Finance Party of the
        payment of any Finance Obligation to the payment of any other liability
        (whether matured or unmatured) of any Credit Party to its creditors;

                        (x)      any act or failure to act by the U.S.
        Collateral Agent or any other Finance Party under this Agreement or
        otherwise which may deprive any Credit Party of any right to
        subrogation, contribution or reimbursement against any other Credit
        Party or any right to recover full indemnity for any payments made by
        such Credit Party in respect of the Finance Obligations; or

                        (xi)     any other act or omission to act or delay of
        any kind by any Credit Party or any Finance Party or any other Person or
        any other circumstance whatsoever which might, but for the provisions of
        this clause, constitute a legal or equitable discharge of any Credit
        Party's obligations hereunder.

                Each Credit Party has irrevocably and unconditionally delivered
this Agreement to the U.S. Collateral Agent, for the benefit of the Finance
Parties, and the failure by any other Person to sign this Agreement or a pledge
agreement similar to this Agreement or otherwise shall not discharge the
obligations of any Credit Party hereunder.

                This Agreement shall remain fully enforceable against each
Credit Party irrespective of any defenses that any other Credit Party may have
or assert in respect of the Finance Obligations, including, without limitation,
failure of consideration, breach of warranty, payment, statute of frauds,
statute of limitations, accord and satisfaction and usury.

                SECTION 2.03     CONTINUING LIABILITY OF THE CREDIT PARTIES. The
Security Interests are granted as security only and shall not subject the U.S.
Collateral Agent or any Finance Party to, or transfer or in any way affect or
modify, any obligation or liability of any Credit Party with respect to any of
the Collateral or any transaction in connection therewith.

                                   ARTICLE III
                         REPRESENTATIONS AND WARRANTIES

                Each Credit Party represents and warrants that:

                                      -10-
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                SECTION 3.01     TITLE TO COLLATERAL. Such Credit Party is the
legal, record and beneficial owner of, and has good and marketable title to, all
of the Collateral pledged by it hereunder, free and clear of any Liens other
than Permitted Liens and Liens securing indebtedness to be repaid with the
proceeds of the Finance Obligations and in respect of which the Administrative
Agents have received pay-off letters and instruments appropriate under local Law
to effect the termination of such Liens. Other than financing statements or
other similar or equivalent documents or instruments with respect to the
Security Interests and Permitted Liens, no financing statement, mortgage,
security agreement or similar or equivalent document or instrument covering all
or any part of the Collateral is on file or of record in any jurisdiction in
which such filing or recording would be effective to perfect a Lien on such
Collateral. No Collateral is in the possession or control of any Person
asserting any claim thereto or security interest therein, except that the U.S.
Collateral Agent or its nominee, custodian or a Securities Intermediary acting
on its behalf may have possession and/or control of Collateral as contemplated
hereby and by the other Finance Documents.

                SECTION 3.02     VALIDITY, PERFECTION AND PRIORITY OF SECURITY
INTERESTS. The Security Interests constitute valid security interests under the
UCC securing the Finance Obligations. Upon Delivery of all Collateral to the
U.S. Collateral Agent in accordance with the provisions hereof and filing of UCC
financing statements stating that the same covers "all assets of the Debtor",
"all personal property of the Debtor" or words of similar import in the offices
specified in SCHEDULE V hereto, the Security Interests shall constitute
perfected security interests in all right, title and interest of such Credit
Party in the Collateral (subject to the requirements of Section 9-315 of the UCC
with respect to any proceeds of Collateral and to the further requirement that
additional steps may be necessary to perfect the Security Interests in dividends
or other distributions in kind), in each case prior to all other Liens and
rights of others therein except for Permitted Liens, and, to the extent control
of such Collateral may be obtained pursuant to Article 8 and/or 9 of the UCC,
the U.S. Collateral Agent will have control of the Collateral subject to no
adverse claims of any other Person. On and as of the date hereof no
registration, recordation or filing with any Governmental Authority is required
in connection with the execution or delivery of this Agreement, or necessary for
the validity or enforceability hereof or for the perfection of the Security
Interests.

                SECTION 3.03     COLLATERAL.

                (a)     SCHEDULES I, II, III AND IV hereto (as such schedules
may be amended, supplemented or modified from time to time) set forth (i) the
name and jurisdiction of organization of, and the ownership interest (including
percentage owned and number of shares, units or other equity interests) of such
Credit Party in the Shares, LLC Interests and Partnership Interests issued by
each of such Credit Party's direct Subsidiaries which are required to be
included in the Collateral and pledged hereunder, (ii) all other Shares, LLC
Interests and Partnership Interests directly owned by such Credit Party that are
required to be included in the Collateral and pledged hereunder and (iii) the
issuer, date of issuance and amount of all promissory notes directly owned or
held by such Credit Party that are required to be included in the Collateral and
pledged hereunder. Such Credit Party holds all such Collateral directly (i.e.,
not through a Subsidiary, Securities Intermediary or any other Person).

                (b)     All Collateral consisting of Pledged Shares, Pledged LLC
Interests and Pledged Partnership Interests has been duly authorized and validly
issued, is fully paid and non-assessable and is subject to no options to
purchase or similar rights of any Person. Except as set forth on SCHEDULES I,
III and IV hereto, (i) such Collateral constitutes 100% of the issued and
outstanding shares of capital stock or other equity interests of the respective
issuers thereof, (ii) no issuer of Collateral has outstanding any security
convertible into or exchangeable for any shares of its capital stock or other
equity interests or any warrant, option, convertible security, instrument or
other interest entitling the holder thereof to acquire any such shares or any
security convertible into or exchangeable for such shares, (iii) there are no
voting

                                      -11-
<Page>

trusts, stockholder agreements, proxies or other agreements in effect with
respect to the voting or transfer of such shares of its capital stock and (iv)
there are no Liens or agreements, arrangements or obligations to create or give
any Lien relating to any such shares of capital stock. No Credit Party is now
and or will become a party to or otherwise bound by any agreement, other than
this Agreement, which restricts in any manner the rights of the U.S. Collateral
Agent or any other present or future holder of any Collateral with respect
thereto.

                SECTION 3.04     NO CONSENTS. No consent of any other Person
(including, without limitation, any stockholder or creditor of such Credit Party
or any of its Subsidiaries) and no order, consent, approval, license,
authorization or validation of, or filing, recording or registration with, or
exemption by any Governmental Authority is required to be obtained by such
Credit Party in connection with the execution, delivery or performance of this
Agreement, or in connection with the exercise of the rights and remedies of the
U.S. Collateral Agent pursuant to this Agreement, except as may be required in
connection with the disposition of the Collateral by Laws affecting the offering
and sale of securities generally.

                                   ARTICLE IV
                                    COVENANTS

                Each Credit Party covenants and agrees that until the payment in
full of all Finance Obligations and until there is no commitment by any Finance
Party to make further advances, incur obligations or otherwise give value, such
Credit Party will comply with the following:

                SECTION 4.01     DELIVERY OF COLLATERAL. All Collateral shall be
Delivered to and held by or on behalf of the U.S. Collateral Agent pursuant
hereto; PROVIDED that so long as no Event of Default shall have occurred and be
continuing, and except as required by the U.S. Security Agreement, Canadian
Security Agreement, Quebec Hypothec or any other Finance Document, each Credit
Party may retain any Collateral (i) consisting of checks, drafts and other
Instruments (other than Pledged Notes and any additional or substitute
promissory notes issued to or otherwise acquired by such Credit Party in respect
of Pledged Notes) received by it in the ordinary course of business or (ii)
which it is otherwise entitled to receive and retain pursuant to SECTION 5.01
hereof, and the U.S. Collateral Agent shall, promptly upon request of any Credit
Party, make appropriate arrangements for making any U.S. Collateral consisting
of an Instrument or a Certificated Security pledged by such Credit Party
available to it for purposes of presentation, collection or renewal (any such
arrangement to be effected, to the extent deemed appropriate to the U.S.
Collateral Agent, against trust receipt or like document). All Collateral
Delivered hereunder shall be accompanied by any required transfer tax stamps.
The U.S. Collateral Agent shall have the right at any time upon the request of
the Required Lenders, and upon notice to any Credit Party, to cause any or all
of the Collateral to be transferred of record into the name of the U.S.
Collateral Agent or its nominee. Each Credit Party will promptly give the U.S.
Collateral Agent copies of any notices or other communications received by it
with respect to Collateral registered in the name of such Credit Party, and the
U.S. Collateral Agent will promptly give each Credit Party copies of any notices
and communications received by the U.S. Collateral Agent with respect to
Collateral registered in the name of the U.S. Collateral Agent or its nominee or
custodian.

                SECTION 4.02     DELIVERY OF PERFECTION CERTIFICATE; FILING OF
FINANCING STATEMENTS AND DELIVERY OF SEARCH REPORTS. Not less than five Business
Days prior to the Closing Date, such Credit Party shall deliver its Perfection
Certificate to the U.S. Collateral Agent and shall cause all filings and
recordings and other actions specified in SCHEDULE V hereto to have been
completed. The information set forth in the Perfection Certificate shall be
correct and complete as of the Closing Date.

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                SECTION 4.03     CHANGE OF NAME, IDENTITY, STRUCTURE OR
LOCATION; SUBJECTION TO OTHER SECURITY AGREEMENTS. Except pursuant to Asset
Dispositions permitted by the Credit Agreement, such Credit Party will not
change the location of any Collateral or its name, identity, structure or
location (determined as provided in Section 9-307 of the UCC) in any manner, and
shall not become bound, as provided in Section 9-203(d) of the UCC, by a
security agreement entered into by another Person, in each case unless it shall
have given the U.S. Collateral Agent not less than 30 days' prior notice
thereof. Except pursuant to Asset Dispositions permitted by the Credit
Agreement, such Credit Party shall not in any event change the location of any
Collateral or its name, identity, structure or location (determined as provided
in Section 9-307 of the UCC), or become bound, as provided in Section 9-203(d)
of the UCC, by a security agreement entered into by another Person, if such
change would cause the Security Interests in any Collateral to lapse or cease to
be perfected unless such Credit Party has taken on or before the date of lapse
all actions necessary to ensure that the Security Interests in the Collateral do
not lapse or cease to be perfected.

                SECTION 4.04     FURTHER ACTIONS. Such Credit Party will, from
time to time at its expense and in such manner and form as the U.S. Collateral
Agent may reasonably request, execute, deliver, file and record any financing
statement, specific assignment, instrument, document, agreement or other paper
and take any other action (including, without limitation, any filings of
financing or continuation statements under the UCC) that from time to time may
be necessary or advisable, or that the U.S. Collateral Agent may reasonably
request, in order to create, preserve, perfect, confirm or validate the Security
Interests or to enable the U.S. Collateral Agent and the Finance Parties to
obtain the full benefit of this Agreement or to exercise and enforce any of its
rights, powers and remedies created hereunder or under applicable Law with
respect to any of the Collateral. To the extent permitted by applicable Law,
such Credit Party hereby authorizes the U.S. Collateral Agent to file, in the
name of such Credit Party or otherwise and without the signature or other
separate authorization or authentication of such Credit Party appearing thereon,
such UCC financing statements, continuation statements or other financing
statements as the U.S. Collateral Agent in its sole discretion may deem
necessary or appropriate to further perfect or maintain the perfection of the
Security Interests. Such Credit Party agrees that a carbon, photographic,
photostatic or other reproduction of this Agreement or of a financing statement
is sufficient as a financing statement. The Credit Parties shall pay the costs
of, or incidental to, any recording or filing of any financing or continuation
statements concerning the Collateral.

                SECTION 4.05     DISPOSITION OF COLLATERAL. Such Credit Party
will not sell, exchange, assign or otherwise dispose of, or grant any option
with respect to, any Collateral or create or suffer to exist any Lien (other
than the Security Interests and Permitted Liens) on any Collateral except that,
subject to the rights of the U.S. Collateral Agent and the Finance Parties
hereunder if a Default or an Event of Default shall have occurred and be
continuing, such Credit Party may sell, exchange, assign or otherwise dispose
of, or grant options with respect to, Collateral to the extent expressly
permitted by the Credit Agreement whereupon, in the case of any such
disposition, the Security Interests created hereby in such item (but not in any
Proceeds arising from such disposition) shall cease immediately without any
further action on the part of the U.S. Collateral Agent.

                SECTION 4.06     ADDITIONAL COLLATERAL. Such Credit Party will
cause each issuer of the Collateral not to issue any stock, other securities,
limited liability company membership interests, partnership interests,
promissory notes or other instruments in addition to or in substitution for the
Pledged Shares, Pledged LLC Interests, Pledged Partnership Interests and Pledged
Notes issued by such issuer, except to such Credit Party and, in the event that
any issuer of Collateral at any time issues any additional or substitute stock,
other securities, limited liability company membership interests, partnership
interests, promissory notes or other instruments to such Credit Party, such
Credit Party will immediately Deliver all such items to the U.S. Collateral
Agent to hold as Collateral hereunder and will promptly thereafter deliver to
the U.S. Collateral Agent a certificate executed by an authorized officer of
such

                                      -13-
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Credit Party describing such Pledged Shares, Pledged LLC Interests, Pledged
Partnership Interests and/or Pledged Notes, attaching such supplements to
SCHEDULES I THROUGH V hereto as are necessary to cause such Schedules to be
complete and accurate at such time and certifying that such Pledged Shares,
Pledged LLC Interests, Pledged Partnership Interests and/or Pledged Notes have
been duly pledged with the U.S. Collateral Agent hereunder.

                SECTION 4.07     INFORMATION REGARDING COLLATERAL. Such Credit
Party will, promptly upon request, provide to the U.S. Collateral Agent all
information and evidence it may reasonably request concerning the Collateral to
enable the U.S. Collateral Agent to enforce the provisions of this Agreement.

                                    ARTICLE V
                       DISTRIBUTIONS ON COLLATERAL; VOTING

                SECTION 5.01     RIGHT TO RECEIVE DISTRIBUTIONS ON COLLATERAL;
VOTING.

                (a)     So long as no Event of Default shall have occurred and
be continuing:

                        (i)      Each Credit Party shall be entitled to exercise
        any and all voting, management, administration and other consensual
        rights pertaining to the Collateral or any part thereof for any purpose
        not inconsistent with the terms of this Agreement and the other Finance
        Documents; PROVIDED, HOWEVER, that each Credit Party shall give the U.S.
        Collateral Agent at least five days' written notice of the manner in
        which it intends to exercise, or the reasons for refraining from
        exercising, any such right, and no Credit Party shall exercise or
        refrain from exercising any such right if, in the U.S. Collateral
        Agent's judgment, such action would violate or be inconsistent with any
        of the terms of this Agreement, any other Finance Document or any
        Derivatives Agreement, or would have the effect of impairing the
        position or interests of the U.S. Collateral Agent or any other Finance
        Party hereunder or thereunder.

                        (ii)     Each Credit Party shall be entitled to receive
        and retain any and all dividends, interest, distributions, cash,
        instruments and other payments and distributions made upon or in respect
        of the Collateral; PROVIDED, HOWEVER, that any and all:

                                 (A)   dividends, interest and other payments
                and distributions paid or payable other than in cash in respect
                of, and instruments and other property received, receivable or
                otherwise distributed in respect of, or in exchange for, any
                Collateral;

                                 (B)   dividends and other payments and
                distributions paid or payable in cash in respect of any
                Collateral in connection with a partial or total liquidation or
                dissolution or in connection with a reduction of capital,
                capital surplus or paid-in-surplus;

                                 (C)   additional stock, other securities,
                limited liability company membership interests, partnership
                interests, promissory notes or other instruments or property
                paid or distributed in respect of any Pledged Shares, Pledged
                LLC Interests or Pledged Partnership Interests by way of
                share-split, spin-off, split-up, reclassification, combination
                of shares or similar rearrangement;

                                 (D)   all other or additional stock, other
                securities, limited liability company membership interests,
                partnership interests, promissory notes or other instruments or
                property which may be paid in respect of the Collateral by
                reason of any consolidation, merger, exchange of shares,
                conveyance of assets, liquidation or similar reorganization; and

                                      -14-
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                                 (E)   cash paid, payable or otherwise
                distributed in respect of principal of, in redemption of, or in
                exchange for, any Collateral;

        shall be forthwith (i) Delivered to the U.S. Collateral Agent or its
        nominee or custodian to hold as Collateral hereunder or (ii) in the case
        of any amount referred to in this SECTION 5.01(a)(ii) paid or
        distributed in cash, forthwith deposited in a Deposit Account maintained
        with the U.S. Collateral Agent or with respect to which an effective
        Account Control Agreement as contemplated by SECTION 4.14 of the U.S.
        Security Agreement has been delivered to the U.S. Collateral Agent and
        shall, if received by any Credit Party, be received in trust for the
        benefit of the U.S. Collateral Agent and the Finance Parties, be
        segregated from the other property or funds of such Credit Party and be
        forthwith Delivered, in the same form as so received, to the U.S.
        Collateral Agent or its nominee or custodian to hold as Collateral or
        deposited in a Deposit Account as contemplated by CLAUSE (ii) above.

                        (iii)    The U.S. Collateral Agent shall, upon receiving
        a written request from any Credit Party accompanied by a certificate
        signed by an authorized officer of such Credit Party stating that no
        Default or Event of Default has occurred and is continuing, execute and
        deliver (or cause to be executed and delivered) to such Credit Party or
        as specified in such request all proxies, powers of attorney, consents,
        ratifications and waivers and other instruments as such Credit Party may
        reasonably request for the purpose of enabling such Credit Party to
        exercise the voting and other rights which it is entitled to exercise
        pursuant to PARAGRAPH (i) above and to receive the dividends, interest,
        distributions, cash, instruments or other payments or distributions
        which it is authorized to receive and retain pursuant to PARAGRAPH (ii)
        above in respect of any of the Collateral which is registered in the
        name of the U.S. Collateral Agent or its nominee.

                (b)     Upon the occurrence and during the continuance of an
Event of Default:

                        (i)      All rights of each Credit Party to receive the
        dividends, interest, distributions, cash, instruments and other payments
        and distributions which it would otherwise be authorized to receive and
        retain pursuant to SECTION 5.01(a)(ii) shall cease, and all such rights
        shall thereupon become vested in the U.S. Collateral Agent, which shall
        thereupon have the sole right to receive and hold as Collateral such
        dividends, interest, distributions, cash, instruments and other payments
        and distributions.

                        (ii)     All dividends, interest, distributions, cash,
        instruments and other payments and distributions which are received by
        any Credit Party contrary to the provisions of paragraph (i) of this
        SECTION 5.01(b) shall be received in trust for the benefit of the U.S.
        Collateral Agent and the Finance Parties, shall be segregated from other
        property or funds of such Credit Party and shall be forthwith Delivered,
        in the same form as so received to the U.S. Collateral Agent or its
        nominee or custodian to hold as Collateral.

                (c)     Upon the occurrence and during the continuance of an
Event of Default, all rights of such Credit Party to exercise the voting,
management, administration and other consensual rights which it would otherwise
be entitled to exercise pursuant to SECTION 5.01(a)(i) shall cease, all such
rights shall thereupon become vested in the U.S. Collateral Agent, who shall
thereupon have the sole right to exercise such voting and other consensual
rights, and such Credit Party shall take all actions as may be necessary or
appropriate to effect such right of the U.S. Collateral Agent.

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                                   ARTICLE VI
                           GENERAL AUTHORITY; REMEDIES

                SECTION 6.01     GENERAL AUTHORITY. Each Credit Party hereby
irrevocably appoints the U.S. Collateral Agent and any officer or agent duly
appointed by the U.S. Collateral Agent as its true and lawful attorney-in-fact,
with full power of substitution, in the name of such Credit Party, the U.S.
Collateral Agent, the Finance Parties or otherwise, for the sole use and benefit
of the U.S. Collateral Agent and the Finance Parties, but at such Credit Party's
expense, to the extent permitted by Law, to exercise at any time and from time
to time while an Event of Default has occurred and is continuing, all or any of
the following powers with respect to all or any of the Collateral, all acts of
such attorney being hereby ratified and confirmed; such power, being coupled
with an interest, is irrevocable until the Finance Obligations are paid in full
and until there is no commitment by any Finance Party to make further advances,
incur obligations or otherwise give value:

                        (i)      to take any and all appropriate action and to
        execute any and all documents and instruments which may be necessary or
        desirable to carry out the terms of this Agreement;

                        (ii)     to receive, take, indorse, assign and deliver
        any and all checks, notes, drafts, acceptances, documents and other
        negotiable and non-negotiable Instruments taken or received by such
        Credit Party as, or in connection with, the Collateral;

                        (iii)    to accelerate any Pledged Note which may be
        accelerated in accordance with its terms, and to otherwise demand, sue
        for, collect, receive and give acquittance for any and all monies due or
        to become due on or by virtue of any Collateral;

                        (iv)     to commence, settle, compromise, compound,
        prosecute, defend or adjust any claim, suit, action or proceeding with
        respect to, or in connection with, the Collateral;

                        (v)      to sell, transfer, assign or otherwise deal in
        or with the Collateral or the Proceeds or avails thereof, as fully and
        effectually as if the U.S. Collateral Agent were the absolute owner
        thereof;

                        (vi)     to extend the time of payment of any or all of
        the Collateral and to make any allowance and other adjustments with
        respect thereto;

                        (vii)    to vote all or any part of the Pledged Shares,
        Pledged LLC Interests, Pledged Partnership Interests and/or Pledged
        Notes (whether or not transferred into the name of the U.S. Collateral
        Agent) and give all consents, waivers and ratifications in respect of
        the Collateral; and

                        (viii)   to do, at its option, but at the expense of
        such Credit Party, at any time or from time to time, all acts and things
        which the U.S. Collateral Agent reasonably deems necessary to protect or
        preserve the Collateral and to realize upon the Collateral.

                SECTION 6.02     REMEDIES UPON EVENT OF DEFAULT.

                (a)     If any Event of Default has occurred and is continuing,
the U.S. Collateral Agent may, in addition to all other rights and remedies
granted to it in this Agreement and in any other agreement securing, evidencing
or relating to the Finance Obligations: (i) exercise on behalf of the Finance
Parties all rights and remedies of a secured party under the UCC (whether or not
in effect in the

                                      -16-
<Page>

jurisdiction where such rights are exercised) and, in addition, (ii)
without demand of performance or other demand or notice of any kind (except as
herein provided or as may be required by mandatory provisions of Law) to or upon
any Credit Party or any other Person (all of which demands and/or notices are
hereby waived by each Credit Party), (A) apply all cash, if any, then held by it
as Collateral as specified in SECTION 6.07 and (B) if there shall be no such
cash or if such cash shall be insufficient to pay all the Finance Obligations in
full or cannot be so applied for any reason or if the U.S. Collateral Agent
determines to do so, collect, receive, appropriate and realize upon the
Collateral and/or sell, assign, give an option or options to purchase or
otherwise dispose of and deliver the Collateral (or contract to do so) or any
part thereof in one or more parcels (which need not be in round lots) at public
or private sale or at broker's board or on any securities exchange, at any
office of the U.S. Collateral Agent or elsewhere in such manner as is
commercially reasonable and as the U.S. Collateral Agent may deem best, for
cash, on credit or for future delivery, without assumption of any credit risk
and at such price or prices as the U.S. Collateral Agent may deem satisfactory.

                (b)     The U.S. Collateral Agent shall give each Credit Party
not less than 10 days' prior notice of the time and place of any sale or other
intended disposition of any of the Collateral, except any Collateral which
threatens to decline speedily in value or is of a type customarily sold on a
recognized market. Any such notice shall (i) in the case of a public sale, state
the time and place fixed for such sale, (ii) in the case of a sale at a broker's
board or on a securities exchange, state the board or exchange at which such
sale is to be made and the day on which the Collateral, or the portion thereof
being sold, will first be offered for sale, (iii) in the case of a private sale,
state the day after which such sale may be consummated, (iv) contain the
information specified in Section 9-613 of the UCC, (v) be authenticated and (vi)
be sent to the parties required to be notified pursuant to Section 9-611(c) of
the UCC; PROVIDED that, if the U.S. Collateral Agent fails to comply with this
sentence in any respect, its liability for such failure shall be limited to the
liability (if any) imposed on it as a matter of Law under the UCC. The
Collateral Agent and each Credit Party agree that such notice constitutes
reasonable notification within the meaning of Section 9-611 of the UCC. Except
as otherwise provided herein, each Credit Party hereby waives, to the extent
permitted by applicable Law, notice and judicial hearing in connection with the
U.S. Collateral Agent's taking possession or disposition of any of the
Collateral.

                (c)     The U.S. Collateral Agent or any Finance Party may be
the purchaser of any or all of the Collateral so sold at any public sale (or, if
the Collateral is of a type customarily sold in a recognized market or is of a
type which is the subject of widely distributed standard price quotations, at
any private sale). Each Credit Party will execute and deliver such documents and
take such other action as the U.S. Collateral Agent reasonably deems necessary
or advisable in order that any such sale may be made in compliance with Law.
Upon any such sale, the U.S. Collateral Agent shall have the right to deliver,
assign and transfer to the purchaser thereof the Collateral so sold. Each
purchaser at any such sale shall hold the Collateral so sold to it absolutely
and free from any claim or right of whatsoever kind. Any such public sale shall
be held at such time or times within ordinary bankers hours and at such place or
places as the U.S. Collateral Agent may fix in the notice of such sale. At any
such sale, the Collateral may be sold in one lot as an entirety or in separate
parcels, as the U.S. Collateral Agent may determine. The U.S. Collateral Agent
shall not be obligated to make any such sale pursuant to any such notice. The
U.S. Collateral Agent may, without notice or publication, adjourn any public or
private sale or cause the same to be adjourned from time to time by announcement
at the time and place fixed for the sale, and such sale may be made at any time
or place to which the same may be so adjourned without further notice. In the
case of any sale of all or any part of the Collateral on credit or for future
delivery, the Collateral so sold may be retained by the U.S. Collateral Agent
until the selling price is paid by the purchaser thereof, but the U.S.
Collateral Agent shall not incur any liability in the case of the failure of
such purchaser to take up and pay for the Collateral so sold and, in the case of
any such failure, such Collateral may again be sold upon like notice.

                                      -17-
<Page>

                SECTION 6.03     SECURITIES ACT; REGISTRATION RIGHTS.

                (a)     SECURITIES ACT. In view of the position of the Credit
Parties in relation to the Collateral, or because of other present or future
circumstances, a question may arise under the Securities Act of 1933, as now or
hereafter in effect, or any similar statute in effect in Canada or hereafter
enacted analogous in purpose or effect (such Act and any such similar statute as
from time to time in effect being herein called the "SECURITIES LAWS") with
respect to any disposition of the Collateral permitted hereunder. Each Credit
Party understands that compliance with the Securities Laws might very strictly
limit the course of conduct of the U.S. Collateral Agent if the U.S. Collateral
Agent were to attempt to dispose of all or any part of the Collateral, and might
also limit the extent to which or the manner in which any subsequent transferee
of any Collateral could dispose of the same. Similarly, there may be other legal
restrictions or limitations affecting the U.S. Collateral Agent in any attempt
to dispose of all or part of the Collateral under applicable Blue Sky or other
state securities Laws or similar Laws analogous in purpose or effect. Without
limiting the generality of the foregoing, the provisions of this SECTION 6.03
would apply if, for example, the U.S. Collateral Agent were to place all or any
part of the Collateral for private placement by an investment banking firm, or
if such investment banking firm purchased all or any part of the Collateral for
its own account, or if the U.S. Collateral Agent placed all or any part of the
Collateral privately with a purchaser or purchasers.

                Accordingly, each Credit Party expressly agrees that the U.S.
Collateral Agent is authorized, in connection with any sale of any Collateral,
if it deems it advisable so to do, (i) to restrict the prospective bidders on or
purchasers of any of the Collateral to a limited number of sophisticated
investors who will represent and agree that they are purchasing for their own
account for investment and not with a view to the distribution or sale of any of
such Collateral, (ii) to cause to be placed on certificates for any or all of
the Collateral or on any other securities pledged hereunder a legend to the
effect that such security has not been registered under any Securities Law and
may not be disposed of in violation of the provision of said Act and (iii) to
impose such other limitations or conditions in connection with any such sale as
the U.S. Collateral Agent deems necessary or advisable in order to comply with
any Law. Each Credit Party covenants and agrees that it will execute and deliver
such documents and take such other action as the U.S. Collateral Agent
reasonably deems necessary or advisable in order that any such sale may be made
in compliance with any Securities Law and all other applicable Laws. Each Credit
Party acknowledges and agrees that such limitations may result in prices and
other terms less favorable to the seller than if such limitations were not
imposed, and, notwithstanding such limitations, agrees that any such sale shall
be deemed to have been made in a commercially reasonable manner, it being the
agreement of the Credit Parties and the U.S. Collateral Agent that the
provisions of this SECTION 6.03 will apply notwithstanding the existence of a
public or private market upon which the quotations or sales prices may exceed
substantially the price at which the U.S. Collateral Agent sells the Collateral.
Except as required by applicable Law, the U.S. Collateral Agent shall be under
no obligation to delay a sale of any Collateral for a period of time necessary
to permit the issuer of any securities contained therein to register such
securities under the Securities Laws, or under applicable state securities Laws,
even if the issuer would agree to do so. Furthermore, each Credit Party
acknowledges that it is aware that Section 9-610 of the UCC provides that the
U.S. Collateral Agent or a Finance Party may purchase Collateral if it is sold
at a public sale. Each Credit Party also acknowledges that it is aware that
staff personnel of the United States Securities and Exchange Commission have,
over a period of years, issued various No-Action Letters that describe
procedures which, in the view of the SEC staff, permit a foreclosure sale of
securities to occur in a manner that is public for purposes of Part 6 of Article
9 of the UCC, yet not public for purposes of Section 4(2) of the Securities Act.
Each Credit Party is also aware that the U.S. Collateral Agent or one or more
Finance Parties may wish to purchase Collateral that is sold at a foreclosure
sale, and such Credit Party believes that such purchases would be appropriate in
circumstances in which the Collateral Securities are sold in conformity with the
principles set forth in the No-Action Letters. Accordingly, each Credit Party
specifically agrees that a foreclosure sale conducted in

                                      -18-
<Page>

conformity with the principles set forth in the No-Action Letters: (i) shall be
considered to be a "public" sale for purposes of Section 9-610 of the UCC; (ii)
will be considered commercially reasonable notwithstanding that the U.S.
Collateral Agent or other Finance Party has not registered or sought to register
the Collateral under the Securities Laws, even if one or more Credit Parties
agrees to pay all costs of the registration process; and (iii) shall be
considered to be commercially reasonable notwithstanding that the U.S.
Collateral Agent or one or more other Finance Parties purchases Collateral at
such a sale.

                (b)     REGISTRATION RIGHTS. If the U.S. Collateral Agent shall
determine to exercise its right to sell all or any of the Collateral and if in
the opinion of counsel for the U.S. Collateral Agent it is necessary, or if in
the opinion of the U.S. Collateral Agent it is advisable, to have all or any of
the securities included in the Collateral or the portion thereof to be sold
registered under the provisions of any Securities Laws, each Credit Party
agrees, at its own expense (including, without limitation, expenses relating to
brokers commissions), (i) to execute and deliver, and to use its commercially
reasonable efforts to cause each corporation whose securities are to be sold and
their respective directors and officers to execute and deliver, all such
instruments and documents, and to do or cause to be done all other such acts and
things, as may be necessary or, in the opinion of the U.S. Collateral Agent,
advisable to register such securities under the provisions of the Securities
Laws and to cause the registration statement relating thereto to become
effective and to remain effective for such period as prospectuses are required
by Law to be furnished, and to make or cause to be made all amendments and
supplements thereto and to the related prospectus which, in the opinion of the
U.S. Collateral Agent, are necessary or advisable, all in conformity with the
requirements of the Securities Laws and the rules and regulations of all
applicable Securities Commissions, (ii) to use its best efforts to cause the
corporation whose securities are to be sold to agree to prepare, and to make
available to its security holders as soon as practicable, an earnings statement
(which need not be audited) covering the period of at least 12 months beginning
with the first month after the effective date of any such registration
statement, which earning statement will satisfy the provisions of Section 11(a)
of the Securities Act of 1933 or of any other similar provision of applicable
Securities Laws, (iii) to use its commercially reasonable efforts to qualify
such securities under state Blue Sky or securities Laws and to obtain the
approval of any Governmental Authorities for the sale of such securities as
requested by the U.S. Collateral Agent and (iv) at the request of the U.S.
Collateral Agent, to indemnify and hold harmless the U.S. Collateral Agent and
any underwriters (and any person controlling any of the foregoing) from and
against any loss, liability, claim, damage and expense (and reasonable counsel
fees incurred in connection therewith) under the Securities Act of 1933 or
otherwise insofar as such loss, liability, claim, damage or expense arises out
of or is based upon any untrue statement or alleged untrue statement of a
material fact contained in such registration statement or prospectus or in any
preliminary prospectus or any amendment or supplement thereto, or arises out of
or is based upon any omission or alleged omission to state therein a material
fact required to be stated or necessary to make the statements therein not
misleading, such indemnification to remain operative regardless of any
investigation made by or on behalf of the U.S. Collateral Agent or any
underwriters (or any person controlling any of the foregoing); PROVIDED that no
Credit Party shall be liable in any case to the extent that any such loss,
liability, claim, damage or expense arises out of or is based on an untrue
statement or alleged untrue statement or an omission or an alleged omission made
in reliance upon and in conformity with written information furnished to such
Credit Party by the U.S. Collateral Agent or any underwriter expressly for use
in such registration statement or prospectus.

                SECTION 6.04     OTHER RIGHTS OF THE U.S. COLLATERAL AGENT.

                (a)     If any Event of Default has occurred and is continuing,
the U.S. Collateral Agent, instead of exercising the power of sale conferred
upon it pursuant to SECTION 6.02, may proceed by a suit or suits at Law or in
equity to foreclose the Security Interests and sell the Collateral, or any
portion thereof, under a judgment or decree of a court or courts of competent
jurisdiction, and may in addition

                                      -19-
<Page>

institute and maintain such suits and proceedings as the U.S. Collateral Agent
may deem appropriate to protect and enforce the rights vested in it by this
Agreement.

                (b)     If any Event of Default has occurred and is continuing,
the U.S. Collateral Agent shall, to the extent permitted by applicable Law,
without notice to any Credit Party or any party claiming through any Credit
Party, without regard to the solvency or insolvency at such time of any Person
then liable for the payment of any of the Finance Obligations, without regard to
the then value of the Collateral and without requiring any bond from any
complainant in such proceedings, be entitled as a matter of right to the
appointment of a receiver or receivers (who may be the U.S. Collateral Agent) of
the Collateral or any part thereof, and of the profits, revenues and other
income thereof, pending such proceedings, with such powers as the court making
such appointment shall confer, and to the entry of an order directing that the
profits, revenues and other income of the property constituting the whole or any
part of the Collateral be segregated, sequestered and impounded for the benefit
of the U.S. Collateral Agent and the Finance Parties, and each Credit Party
irrevocably consents to the appointment of such receiver or receivers and to the
entry of such order.

                SECTION 6.05     LIMITATION ON DUTY OF U.S. COLLATERAL AGENT IN
RESPECT OF COLLATERAL. Beyond the exercise of reasonable care in the custody
thereof, neither the U.S. Collateral Agent nor any Finance Party shall have any
duty to exercise any rights or take any steps to preserve the rights of any
Credit Party in the Collateral in its or their possession or control or in the
possession or control of any agent or bailee or any income thereon or as to the
preservation of rights against prior parties or any other rights pertaining
thereto, nor shall the U.S. Collateral Agent or any Finance Party be liable to
any Credit Party or any other Person for failure to meet any obligation imposed
by Section 9-207 of the UCC or any successor provision. Each Credit Party agrees
that the U.S. Collateral Agent shall at no time be required to, nor shall the
U.S. Collateral Agent be liable to any Credit Party for any failure to, account
separately to any Credit Party for amounts received or applied by the U.S.
Collateral Agent from time to time in respect of the Collateral pursuant to the
terms of this Agreement. Without limiting the foregoing, the U.S. Collateral
Agent shall be deemed to have exercised reasonable care in the custody and
preservation of the Collateral in its possession or control if the Collateral is
accorded treatment substantially equal to that which the U.S. Collateral Agent
accords its own property, and (i) shall not be liable or responsible for any
loss or damage to any of the Collateral, or for any diminution in the value
thereof, by reason of the act or omission of any agent or bailee selected by the
U.S. Collateral Agent in good faith or (ii) shall not have any duty or
responsibility for ascertaining or taking action with respect to calls,
conversions, exchanges, maturities, tenders or other matters relative to any
Collateral, whether or not the U.S. Collateral Agent has or is deemed to have
knowledge of such matters.

                SECTION 6.06     WAIVER AND ESTOPPEL.

                (a)     Each Credit Party agrees, to the extent it may lawfully
do so, that it will not at any time in any manner whatsoever claim or take the
benefit or advantage of, any appraisal, valuation, stay, extension, moratorium,
turnover or redemption Law, or any Law permitting it to direct the order in
which the Collateral shall be sold, now or at any time hereafter in force which
may delay, prevent or otherwise affect the performance or enforcement of this
Agreement, and each Credit Party hereby waives all benefit or advantage of all
such Laws. Each Credit Party covenants that it will not hinder, delay or impede
the execution of any power granted to the U.S. Collateral Agent, the
Administrative Agents or any other Finance Party in any Finance Document.

                (b)     Each Credit Party, to the extent it may lawfully do so,
on behalf of itself and all who claim through or under it, including without
limitation any and all subsequent creditors, vendees, assignees and lienors,
waives and releases all rights to demand or to have any marshalling of the
Collateral upon any sale, whether made under any power of sale granted herein or
pursuant to judicial

                                      -20-
<Page>

proceedings or under any foreclosure or any enforcement of this
Agreement, and consents and agrees that all of the Collateral may at any such
sale be offered and sold as an entirety.

                (c)     Each Credit Party waives, to the extent permitted by
Law, presentment, demand, protest and any notice of any kind (except the notices
expressly required hereunder or in the other Finance Documents) in connection
with this Agreement and any action taken by the U.S. Collateral Agent with
respect to the Collateral.

                SECTION 6.07     APPLICATION OF PROCEEDS.

                (a)     PRIORITY OF DISTRIBUTIONS. The proceeds of any sale of,
or other realization upon, all or any part of the Collateral (including any
proceeds received and held pursuant to SECTION 5.01) and any cash held by the
U.S. Collateral Agent or its nominee or custodian hereunder shall be applied as
provided in SECTION 8.03 of the Credit Agreement. The U.S. Collateral Agent may
make distributions hereunder in cash or in kind or, on a ratable basis, in any
combination thereof.

                (b)     DISTRIBUTIONS WITH RESPECT TO LETTERS OF CREDIT AND
BANKERS' ACCEPTANCES. Each of the Credit Parties and the Finance Parties agrees
and acknowledges that if (after all outstanding Loans, LC obligations and BA
Reimbursement Obligations have been paid in full) the Lenders are to receive a
distribution on account of undrawn amounts with respect to Letters of Credit
issued (or deemed issued) or Bankers' Acceptances issued under the Credit
Agreement, such amounts shall be deposited in the applicable LC Cash Collateral
Account (in the case of Letters of Credit), or the relevant cash collateral
account established pursuant to SECTION 2.06(k) of the Credit Agreement (the "BA
CASH COLLATERAL ACCOUNT") (in the case of Bankers' Acceptances), as cash
security for the repayment of Finance Obligations owing to the Lenders as such.
Upon termination of all outstanding Letters of Credit and Bankers' Acceptances,
all of such cash security shall be applied to the remaining Finance Obligations
of the Lenders. If there remains any excess cash security, such excess cash
shall be withdrawn by the U.S. Collateral Agent or by the Canadian Collateral
Agent, as the case may be, from the U.S. LC Cash Collateral Account or the
Canadian LC Cash Collateral Account, respectively, or by the Canadian Collateral
Agent from the BA Cash Collateral Account, and distributed in accordance with
SECTION 6.07(a) hereof.

                (c)     RELIANCE BY U.S. COLLATERAL AGENT. For purposes of
applying payments received in accordance with this SECTION 6.07, the U.S.
Collateral Agent shall be entitled to rely upon (i) the relevant Administrative
Agent under the Credit Agreement and (ii) the authorized representative (the
"REPRESENTATIVE") for the Derivatives Creditors for a determination (which the
relevant Administrative Agent, each Representative for any Derivatives Creditor
and the Finance Parties agree (or shall agree) to provide upon request of the
U.S. Collateral Agent) of the outstanding Senior Obligations, and Derivatives
Obligations owed to the Finance Parties, and shall have no liability to any
Credit Party or any other Finance Party for actions taken in reliance on such
information except in the case of its gross negligence or willful misconduct.
Unless it has actual knowledge (including by way of written notice from a
Derivatives Creditor) to the contrary, the U.S. Collateral Agent, in acting
hereunder, shall be entitled to assume that no Derivatives Agreements are in
existence. All distributions made by the U.S. Collateral Agent pursuant to this
Section shall be presumptively correct (except in the event of manifest error),
and the U.S. Collateral Agent shall have no duty to inquire as to the
application by the Finance Parties of any amounts distributed to them.

                (d)     DEFICIENCIES. It is understood that the Credit Parties
shall remain jointly and severally liable to the extent of any deficiency
between the amount of the proceeds of the Collateral and the amount of the
Finance Obligations.

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                                   ARTICLE VII
                            THE U.S. COLLATERAL AGENT

                SECTION 7.01     CONCERNING THE U.S. COLLATERAL AGENT. The
provisions of ARTICLE IX of the Credit Agreement shall inure to the benefit of
the U.S. Collateral Agent in respect of this Agreement and shall be binding upon
all Credit Parties and all Finance Parties and upon the parties hereto in such
respect. In furtherance and not in derogation of the rights, privileges and
immunities of the U.S. Collateral Agent therein set forth:

                        (i)      The U.S. Collateral Agent is authorized to take
        all such actions as are provided to be taken by it as U.S. Collateral
        Agent hereunder and all other action reasonably incidental thereto. As
        to any matters not expressly provided for herein (including, without
        limitation, the timing and methods of realization upon the Collateral),
        the U.S. Collateral Agent shall act or refrain from acting in accordance
        with written instructions from the Required Lenders or, in the absence
        of such instructions or provisions, in accordance with its discretion.

                        (ii)     The U.S. Collateral Agent shall not be
        responsible for the existence, genuineness or value of any of the
        Collateral or for the validity, perfection, priority or enforceability
        of the Security Interests in any of the Collateral, whether impaired by
        operation of Law or by reason of any action or omission to act on its
        part hereunder unless such action or omission constitutes gross
        negligence or willful misconduct. The U.S. Collateral Agent shall have
        no duty to ascertain or inquire as to the performance or observance of
        any of the terms of this Agreement by any Credit Party.

                SECTION 7.02     APPOINTMENT OF CO-COLLATERAL AGENT. At any time
or times, in order to comply with any legal requirement in any jurisdiction, the
U.S. Collateral Agent may appoint another bank or trust company or one or more
other persons, either to act as co-agent or co-agents, jointly with the U.S.
Collateral Agent, or to act as separate agent or agents on behalf of the Finance
Parties with such power and authority as may be necessary for the effectual
operation of the provisions hereof and may be specified in the instrument of
appointment (which may, in the discretion of the U.S. Collateral Agent, include
provisions for the protection of such co-agent or separate agent similar to the
provisions of SECTION 7.01).

                SECTION 7.03     APPOINTMENT OF SUB-AGENTS. The U.S. Collateral
Agent shall have the right to appoint one or more sub-agents for the purpose of
retaining physical possession of the Pledged Shares, Pledged LLC Interests,
Pledged Partnership Interests and Pledged Notes, which may be held (in the
discretion of the U.S. Collateral Agent) in the name of the relevant Credit
Party, indorsed or assigned in blank or in favor of the U.S. Collateral Agent or
any nominee or custodian of the U.S. Collateral Agent or a sub-agent appointed
by the U.S. Collateral Agent.

                                  ARTICLE VIII
                                  MISCELLANEOUS

                SECTION 8.01     NOTICES. (a) Unless otherwise expressly
provided herein, all notices and other communications provided for hereunder
shall be in writing (including by facsimile transmission) and mailed, faxed or
delivered, to the address, facsimile number or (subject to SUBSECTION (b) below)
electronic mail address specified for notices: (i) in the case of any Subsidiary
Guarantor, as set forth in SECTION 5.01 of the Guaranty; (ii) in the case of the
Borrowers, the Administrative Agents or any Lender, as specified in or pursuant
to SECTION 10.01 of the Credit Agreement; (iii) in the case of the U.S.
Collateral Agent, as set forth in the signature pages hereto; (iv) in the case
of any Derivatives Creditor as set forth in any applicable Derivatives
Agreement; or (v) in the case of any party, at such other address as

                                      -22-
<Page>

shall be designated by such party in a notice to the U.S. Collateral Agent and
each other party hereto. All such notices and other communications shall be
deemed to be given or made upon the earlier to occur of: (i) actual receipt by
the intended recipient and (ii)(A) if delivered by hand or by courier, when
signed for by the intended recipient; (B) if delivered by mail, four Business
Days after deposit in the mails, postage prepaid; (C) if delivered by facsimile
transmission, when sent and receipt has been confirmed by telephone; and (D) if
delivered by electronic mail (which form of delivery is subject to the
provisions of SUBSECTION (b) below), when delivered. Rejection or refusal to
accept, or the inability to deliver because of a changed address of which no
notice was given, shall not affect the validity of notice given in accordance
with this Section.

                (b)     Except as expressly provided herein or as may be agreed
by the Administrative Agents in their sole discretion, electronic mail and
internet and intranet websites may be used only to distribute routine
communications, such as financial statements and other information, and to
distribute Finance Documents for execution by the parties thereto, to distribute
executed Finance Documents in Adobe PDF format and may not be used for any other
purpose.

                SECTION 8.02     NO WAIVERS; NON-EXCLUSIVE REMEDIES. No failure
or delay on the part of the U.S. Collateral Agent or any Finance Party to
exercise, no course of dealing with respect to, and no delay in exercising, any
right, power or privilege under this Agreement or any other Finance Document or
any other document or agreement contemplated hereby or thereby and no course of
dealing between the U.S. Collateral Agent or any Finance Party and any of the
Credit Parties shall operate as a waiver thereof nor shall any single or partial
exercise of any such right, power or privilege hereunder or under any Finance
Document preclude any other or further exercise thereof or the exercise of any
other right, power or privilege hereunder or thereunder. The rights and remedies
provided herein and in the other Finance Documents are cumulative and are not
exclusive of any other remedies provided by Law. Without limiting the foregoing,
nothing in this Agreement shall impair the right of any Finance Party to
exercise any right of set-off or counterclaim it may have and to apply the
amount subject to such exercise to the payment of indebtedness of any Credit
Party other than its indebtedness under the Finance Documents. Each Credit Party
agrees, to the fullest extent it may effectively do so under applicable Law,
that any holder of a participation in a Finance Obligation, whether or not
acquired pursuant to the terms of any applicable Finance Document, may exercise
rights of set-off or counterclaim or other rights with respect to such
participation as fully as if such holder of a participation were a direct
creditor of the Credit Party in the amount of such participation.

                SECTION 8.03     COMPENSATION AND EXPENSES OF THE U.S.
COLLATERAL AGENT; INDEMNIFICATION.

                (a)     EXPENSES. The Credit Parties, jointly and severally,
agree (i) to pay or reimburse the U.S. Collateral Agent for all out-of-pocket
costs and expenses incurred in connection with the preparation, negotiation and
execution of this Agreement and any amendment, waiver, consent or other
modification of the provisions hereof (whether or not the transactions
contemplated hereby are consummated), and the consummation of the transactions
contemplated hereby, including all fees, disbursements and other charges of
Fried, Frank, Harris, Shriver & Jacobson LLP, counsel for the U.S. Collateral
Agent and McCarthy Tetrault LLP, the Canadian counsel for the U.S. Collateral
Agent, (ii) to pay or reimburse the U.S. Collateral Agent and the other Finance
Parties for all taxes which the U.S. Collateral Agent or any Finance Party may
be required to pay by reason of the security interests granted in the Collateral
(including any applicable transfer taxes) or to free any of the Collateral from
the lien thereof and (iii) to pay or reimburse each Agent, any Representative of
one or more Derivatives Creditors and each other Finance Party for all
reasonable costs and expenses incurred in connection with the enforcement,
attempted enforcement or preservation of any rights and remedies under this
Agreement (including all such costs and expenses incurred during any "workout"
or restructuring in respect of the

                                      -23-
<Page>

Finance Obligations and during any legal proceeding, including any proceeding
under any bankruptcy or insolvency proceeding), including all reasonable fees
and disbursements of counsel (including the allocated charges of internal
counsel). The foregoing costs and expenses shall include all search, filing,
recording, title insurance and appraisal charges and fees and taxes related
thereto, and other out-of-pocket expenses incurred by any Agent and the costs of
independent public accountants and other outside experts retained by or on
behalf of the Agents and the Finance Parties. The agreements in this SECTION
8.03(a) shall survive the termination of the Commitments and Derivatives
Agreements and repayment of all Finance Obligations.

                (b)     PROTECTION OF COLLATERAL. If any Credit Party fails to
comply with the provisions of any Finance Document, such that the value of any
Collateral or the validity, perfection, rank or value of any Security Interest
is thereby diminished or potentially diminished or put at risk, the U.S.
Collateral Agent may, but shall not be required to, effect such compliance on
behalf of such Credit Party, and the Credit Parties shall reimburse the U.S.
Collateral Agent for the costs thereof on demand. Any and all excise, property,
sales and use taxes imposed by any state, federal, provincial or local authority
on any of the Collateral, or in respect of periodic appraisals of the Collateral
(as permitted by the Credit Agreement), or in respect of the sale or other
disposition thereof shall be borne and paid by the Credit Parties. If any Credit
Party fails to promptly pay any portion thereof when due, the U.S. Collateral
Agent may, at its option, but shall not be required to, pay the same and charge
the Credit Parties' account therefor, and the Credit Parties agree to reimburse
the U.S. Collateral Agent therefor on demand. All sums so paid or incurred by
the U.S. Collateral Agent for any of the foregoing and any and all other sums
for which any Credit Party may become liable hereunder and all costs and
expenses (including attorneys' fees, legal expenses and court costs) reasonably
incurred by the U.S. Collateral Agent or any Finance Party in enforcing or
protecting the Security Interests or any of their rights or remedies under this
Agreement, shall, together with interest thereon until paid at the rate
applicable to Revolving Base Rate Loans plus 2%, be additional Finance
Obligations hereunder.

                (c)     INDEMNIFICATION. Whether or not the transactions
contemplated hereby or by the other Finance Documents are consummated, each
Credit Party, jointly and severally, agrees to indemnify, save and hold harmless
each Indemnitee from and against: (i) any and all claims, demands, actions or
causes of action that may at any time (including at any time following repayment
of the Finance Obligations and the resignation or removal of any Agent or
Representative or the replacement of any Lender) be asserted or imposed against
any Indemnitee, arising out of or in any way relating to or arising out of the
ownership, purchasing, delivery, control, acceptance, financing, possession,
sale, return or other disposition of the Collateral, the violation of the Laws
of any country, state or other governmental body or unit, or any tort or
contract claim; (ii) any administrative or investigative proceeding by any
Governmental Authority arising out of or related to a claim, demand, action or
cause of action described in CLAUSE (i) above; and (iii) any and all liabilities
(including liabilities under indemnities), losses, costs or expenses (including
fees and disbursements of counsel) that any Indemnitee suffers or incurs as a
result of the assertion of any foregoing claim, demand, action or cause of
action or proceeding, or as a result of the preparation of any defense in
connection with any foregoing claim, demand, action or cause of action or
proceeding, in all cases, and whether or not an Indemnitee is a party to such
claim, demand, action or cause of action, or proceeding; PROVIDED that no
Indemnitee shall be entitled to indemnification for any claim to the extent such
claim is determined by a court of competent jurisdiction in a final
non-appealable judgment to have been caused by its own gross negligence or
willful misconduct. In the case of an investigation, litigation or other
proceeding to which the indemnity in this SECTION 8.03(b) applies, such
indemnity shall be effective whether or not such investigation, litigation or
proceeding is brought by any Credit Party, its directors, shareholders or
creditors or an Indemnitee or any other Person or any Indemnitee is otherwise a
party thereto and whether or not the transactions contemplated hereby are
consummated. Without prejudice to the survival of any other agreement of the
Credit Parties hereunder and under the other Finance Documents, the agreements
and obligations of the Credit Parties contained in

                                      -24-
<Page>

this SECTION 8.03(b) shall survive the repayment of the Loans, LC Obligations,
BA Reimbursement Obligations and other obligations under the Finance Documents
and the termination of the Commitments. Any amounts paid by any Indemnitee as to
which such Indemnitee has a right to reimbursement hereunder shall constitute
Finance Obligations.

                (d)     CONTRIBUTION. If and to the extent that the obligations
of any Credit Party under this SECTION 8.03 are unenforceable for any reason,
each Credit Party hereby agrees to make the maximum contribution to the payment
and satisfaction of such obligations which is permissible under applicable Law.

                SECTION 8.04     ENFORCEMENT. The Finance Parties agree that
this Agreement may be enforced only by the action of the U.S. Collateral Agent,
acting upon the instructions of the Required Lenders (or, after the date on
which all Senior Obligations have been paid in full and all Commitments with
respect thereto terminated, the holders of at least 51% of the outstanding
Derivatives Obligations) and that no other Finance Party shall have any right
individually to seek to enforce this Agreement or to realize upon the security
to be granted hereby, it being understood and agreed that such rights and
remedies may be exercised by the U.S. Collateral Agent or the holders of at
least 51% of the outstanding Derivatives Obligations, as the case may be, for
the benefit of the Finance Parties upon the terms of this Agreement and the
other Finance Documents.

                SECTION 8.05     AMENDMENTS AND WAIVERS. Any provision of this
Agreement may be amended, changed, discharged, terminated or waived if, but only
if, such amendment or waiver is in writing and is signed by each Credit Party
directly affected by such amendment, change, discharge, termination or waiver
(it being understood that the addition or release of any Credit Party hereunder
shall not constitute an amendment, change, discharge, termination or waiver
affecting any Credit Party other than the Credit Party so added or released) and
either (i) the U.S. Collateral Agent (with the consent of the Required Lenders
or, to the extent required by SECTION 10.03 of the Credit Agreement, all of the
Lenders), at all times prior to the time on which all Finance Obligations have
been paid in full and all Commitments with respect thereto have been terminated
or (ii) the holders of at least 51% of all Derivatives Obligations then
outstanding, at all times after the time at which the Finance Obligations have
been paid in full and all Commitments with respect thereto have been terminated;
PROVIDED, HOWEVER, that no such amendment, change, discharge, termination or
waiver shall be made to SECTION 6.07 hereof or this SECTION 8.05 without the
consent of each Finance Party adversely affected thereby; and PROVIDED, FURTHER,
that any amendment, change, discharge, termination or waiver adversely affecting
the rights and benefits of a single Class of Finance Parties (and not all
Finance Parties in a like or similar manner) shall require the written consent
of the Required Finance Parties of such Class of Finance Parties. For the
purposes of this SECTION 8.05, the term "Class" means each class of Finance
Parties, i.e., whether (x) the Senior Lenders, as holders of the Senior
Obligations, (y) the Derivatives Creditors, as holders of the Derivatives
Obligations. For the purposes of this SECTION 8.05, the term "Required Finance
Parties" of any Class means each of (x) with respect to the Senior Obligations,
the Required Lenders (as defined in the Credit Agreement) or (y) with respect to
the Derivatives Obligations, the holders of 51% of all Derivatives Obligations
outstanding from time to time.

                SECTION 8.06     SUCCESSORS AND ASSIGNS. This Agreement shall be
binding upon each of the parties hereto and inure to the benefit of the U.S.
Collateral Agent and the Finance Parties and their respective successors and
assigns. In the event of an assignment of all or any of the Finance Obligations,
the rights hereunder, to the extent applicable to the indebtedness so assigned,
may be transferred with such indebtedness. No Credit Party shall assign or
delegate any of its rights and duties hereunder without the prior written
consent of the Required Lenders or all of the Lenders as provided in Section
10.03 of the Credit Agreement.

                                      -25-
<Page>

                SECTION 8.07     GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
(INCLUDING, WITHOUT LIMITATION, SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF
THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES, EXCEPT
AS OTHERWISE REQUIRED BY MANDATORY PROVISIONS OF LAW AND EXCEPT TO THE EXTENT
THAT REMEDIES PROVIDED BY THE LAWS OF ANY JURISDICTIONS OTHER THAN NEW YORK ARE
GOVERNED BY THE LAWS OF SUCH JURISDICTIONS.

                SECTION 8.08     LIMITATION OF LAW; SEVERABILITY.

                (a)     All rights, remedies and powers provided in this
Agreement may be exercised only to the extent that the exercise thereof does not
violate any applicable provision of Law, and all the provisions of this
Agreement are intended to be subject to all applicable mandatory provisions of
Law which may be controlling and be limited to the extent necessary so that they
will not render this Agreement invalid, unenforceable in whole or in part, or
not entitled to be recorded, registered or filed under the provisions of any
applicable Law.

                (b)     If any provision hereof is invalid or unenforceable in
any jurisdiction, then, to the fullest extent permitted by Law, (i) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in favor of the U.S. Collateral Agent and the
Finance Parties in order to carry out the intentions of the parties hereto as
nearly as may be possible and (ii) the invalidity or unenforceability of any
provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provisions in any other jurisdiction.

                SECTION 8.09     COUNTERPARTS; EFFECTIVENESS. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective with respect to each Credit
Party when the U.S. Collateral Agent shall receive counterparts hereof executed
by itself and such Credit Party; provided that, for greater certainty, this
Agreement shall become effective with respect to each of Eckerd Corporation,
Eckerd Fleet, Inc., EDC Drug Stores, Inc., EDC Licensing, Inc. Genovese Drug
Stores, Inc., Thrift Drug Inc. and Thrift Drug Services, Inc., notwithstanding
the fact that such Credit Parties shall be deemed to have executed the
counterpart of this Agreement at 11:59 p.m. on July 31, 2004, upon consummation
of the Acquisition.

                SECTION 8.10     ADDITIONAL CREDIT PARTIES. It is understood and
agreed that any Affiliate of the Borrower that is required by any Finance
Document to execute a counterpart of this Agreement after the date hereof shall
automatically become a Credit Party hereunder with the same force and effect as
if originally named as a Credit Party hereunder by executing an instrument of
accession or joinder satisfactory in form and substance to the U.S. Collateral
Agent and delivering the same to the U.S. Collateral Agent. Concurrently with
the execution and delivery of such instrument of accession or joinder, such
Affiliate shall take all such actions and deliver to the U.S. Collateral Agent
all such documents and agreements as such Affiliate would have been required to
deliver to the U.S. Collateral Agent on or prior to the date of this Agreement
had such Affiliate been a party hereto on the date of this Agreement. Such
additional materials shall include, among other things, supplements to SCHEDULES
I, II, III, IV and V hereto (which Schedules shall thereupon automatically be
amended and supplemented to include all information contained in such
supplements) such that, after giving effect to the accession or joinder of such
Affiliate, each of SCHEDULES I, II, III, IV and V hereto is true, complete and
correct with respect to such Affiliate as of the effective date of such
accession or joinder. The execution and delivery of any such instrument of
accession or joinder, and the amendment and supplementation of the Schedules
hereto as provided in the immediately preceding sentence, shall not require the
consent of any other

                                      -26-
<Page>

Credit Party hereunder. The rights and obligations of each Credit Party
hereunder shall remain in full force and effect notwithstanding the addition of
any new Credit Party as a party to this Agreement.

                SECTION 8.11     TERMINATION; RELEASE OF CREDIT PARTIES.

                (a)     TERMINATION. Upon the full, final and irrevocable
payment and performance of all Finance Obligations, the cancellation or
expiration of all outstanding LC Obligations, BA Reimbursement Obligations and
Derivatives Agreements and the termination of all Commitments under the Finance
Documents, the Security Interests shall terminate and all rights to the
Collateral shall revert to the Credit Parties. In addition, at any time and from
time to time prior to such termination of the Security Interests, the U.S.
Collateral Agent may release any of the Collateral with the prior written
consent of the Required Lenders; PROVIDED that the release of all or
substantially all of the Collateral shall require the consent of all of the
Lenders. Upon any such termination of the Security Interests or release of
Collateral, the U.S. Collateral Agent will, upon request by and at the expense
of any Credit Party, execute and deliver to such Credit Party such documents as
such Credit Party shall reasonably request to evidence the termination of the
Security Interests or the release of such Collateral, as the case may be. Any
such documents shall be without recourse to or warranty by the U.S. Collateral
Agent or the Finance Parties. The U.S. Collateral Agent shall have no liability
whatsoever to any Finance Party as a result of any release of Collateral by it
as permitted by this SECTION 8.11. Upon any release of Collateral pursuant to
this SECTION 8.11, none of the Finance Parties shall have any continuing right
or interest in such Collateral or the Proceeds thereof.

                (b)     RELEASE OF CREDIT PARTIES. If any part of the Collateral
is sold or otherwise disposed of or liquidated in compliance with the
requirements of the Finance Documents (or such sale, other disposition or
liquidation has been approved in writing by those Finance Parties whose approval
is required by the applicable Finance Documents and the proceeds of such sale,
disposition or liquidation are applied in accordance with the provisions of the
Finance Documents, to the extent applicable, the U.S. Collateral Agent, at the
request and expense of such Credit Party, will duly release from the security
interest created hereby and assign, transfer and deliver to such Credit Party
(without recourse and without representation or warranty) such of the Collateral
as is then being (or has been) so sold, disposed of or liquidated as may be in
the possession or control of the U.S. Collateral Agent and has not theretofore
been released pursuant to this Agreement.

                SECTION 8.12     ENTIRE AGREEMENT. This Agreement and the other
Finance Documents and, in the case of the Derivatives Creditors, the Derivatives
Agreements, constitute the entire agreement and understanding among the parties
hereto and supersede any and all prior agreements and understandings, oral or
written, and any contemporaneous oral agreements and understandings relating to
the subject matter hereof and thereof.

                SECTION 8.13     CONFLICT.

                (a)     To the extent that there is a conflict or inconsistency
between any provision hereof, on the one hand, and any provision of the Credit
Agreement, on the other hand, the Credit Agreement shall control.

                (b)     The Credit Parties acknowledge that the Borrowers are,
concurrent with this Agreement, entering into the PPSA Security Agreement and
the Quebec Hypothec (together, the "CANADIAN SECURITY DOCUMENTS"); and the
Credit Parties further acknowledge and agree that, to the extent performance is
required under the Canadian Security Documents by a Credit Party and such
performance prevents such Credit Party from performing its obligations under
this Agreement, such Credit Party, to the

                                      -27-
<Page>

extent its performance under the Canadian Security Documents is duly performed,
shall be deemed to have performed under this Agreement.

                            [Signature Pages Follow]

                                      -28-
<Page>

        IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first written above.

CREDIT PARTIES:               THE JEAN COUTU GROUP (PJC) INC.

                              By:
                                 ----------------------------------------
                                 Name:
                                 Title:

                                BROOKS PHARMACY, INC.
                                ECKERD CORPORATION
                                ECKERD FLEET, INC.
                                EDC DRUG STORES, INC.
                                EDC LICENSING, INC.
                                GENOVESE DRUG STORES, INC.
                                JCG HOLDINGS (USA), INC.
                                JEAN COUTU ACQUISITION ONE, INC.
                                JEAN COUTU ACQUISITION TWO, INC.
                                JEAN COUTU ACQUISITION THREE, INC.
                                MAXI DRUG NORTH, INC.
                                MAXI DRUG, INC.
                                MAXI GREEN INC.
                                MC WOONSOCKET, INC.
                                P.J.C. DISTRIBUTION, INC.
                                P.J.C. OF VERMONT INC.
                                P.J.C. REALTY CO., INC.
                                PJC LEASE HOLDINGS, INC.
                                PJC OF CRANSTON, INC.
                                PJC OF EAST PROVIDENCE, INC.
                                PJC OF MASSACHUSETTS, INC.
                                PJC OF RHODE ISLAND, INC.
                                PJC OF WEST WARWICK, INC.
                                PJC REALTY MA, INC.
                                PJC SPECIAL REALTY HOLDINGS, INC.
                                THE JEAN COUTU GROUP (PJC) USA, INC.
                                THRIFT DRUG, INC.
                                THRIFT DRUG SERVICES, INC.

                                By:
                                   --------------------------------------
                                 Michel Coutu, as President of each

[Signature page to
Pledge Agreement]

                                       S-1
<Page>

                                PJC ARLINGTON REALTY LLC
                                PJC DORCHESTER REALTY LLC
                                PJC ESSEX REALTY LLC
                                PJC HAVERHILL REALTY LLC
                                PJC HYDE PARK REALTY LLC
                                PJC MANCHESTER REALTY LLC
                                PJC MANSFIELD REALTY LLC
                                PJC NEW LONDON REALTY LLC
                                PJC NORWICH REALTY LLC
                                PJC PETERBOROUGH REALTY LLC
                                PJC PROVIDENCE REALTY LLC
                                PJC REVERE REALTY LLC

                                By: PJC SPECIAL REALTY HOLDINGS, INC., a
                                    Delaware corporation, as Sole Member of each

                                    By:
                                       --------------------------------------
                                       Michel Coutu, as President

                                MAXI DRUG SOUTH, L.P.

                                By: MAXI DRUG, INC., a Delaware corporation, its
                                    General Partner

                                    By:
                                       --------------------------------------
                                       Michel Coutu, as President

                                PJC REALTY N.E. LLC
                                JEAN COUTU GROUP HOLDINGS (USA), LLC

                                By: THE JEAN COUTU GROUP (PJC) USA, INC., a
                                    Delaware corporation, its Sole Member

                                    By:
                                       --------------------------------------
                                       Michel Coutu, as President of each

                                SERVICES SECURIVOL INC.

                                By:
                                   --------------------------------------
                                   Name:
                                   Title:

[Signature page to
Pledge Agreement]

                                       S-2
<Page>

                                RX INFORMATION CENTRE LTD.

                                By:
                                   --------------------------------------
                                   Name:
                                   Title:

                                PATERSON'S PHARMACIES LIMITED

                                By:
                                   --------------------------------------
                                   Name:
                                   Title:

                                3090671 NOVA SCOTIA COMPANY

                                By:
                                   --------------------------------------
                                   Name:
                                   Title:

                                3090672 NOVA SCOTIA COMPANY

                                By:
                                   --------------------------------------
                                   Name:
                                   Title:

COLLATERAL AGENT:               DEUTSCH BANK TRUST COMPANIES
                                AMERICAS,
                                   as U.S. Collateral Agent

                                By:
                                   --------------------------------------
                                   Name:
                                   Title:

                                60 Wall Street
                                New York, NY 10005
                                Attention: Mary Kay Coyle
                                Telecopier No.: (212) 797-5690

[Signature page to
Pledge Agreement]

                                       S-3

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