Document:

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                               SECURITY AGREEMENT

     THIS SECURITY AGREEMENT (this "Security Agreement") is entered into as of
December 23, 2005 among PRG-SCHULTZ USA, INC., a Georgia corporation (the
"Borrower"), PRG-SCHULTZ INTERNATIONAL, INC., a Georgia corporation (the
"Parent"), certain of the Domestic Subsidiaries of the Parent (such Domestic
Subsidiaries, together with the Parent, individually a "Guarantor" and
collectively the "Guarantors"; the Guarantors together with the Borrower,
individually an "Obligor", and collectively the "Obligors") and Blum Strategic
Partners II, L.P., as the collateral agent for the Lenders referred to below (in
such capacity together with its successors and permitted assigns, the
"Collateral Agent").

                                    RECITALS

     WHEREAS, pursuant to that certain Credit Agreement, dated as of the date
hereof (as amended, modified, extended, renewed or replaced from time to time,
the "Credit Agreement"), among the Borrower, the Guarantors, the lenders from
time to time party thereto (each a "Lender" and collectively, the "Lenders") and
the Collateral Agent, each of the Lenders, severally and not jointly or jointly
and severally, has agreed to make the Loans upon the terms and subject to the
conditions set forth therein; and

     WHEREAS, it is a condition precedent to the effectiveness of the Credit
Agreement and the obligations of the Lenders to make the Loans under the Credit
Agreement that the Obligors shall have executed and delivered this Security
Agreement in favor of the Collateral Agent, for the benefit of the Lenders.

     NOW, THEREFORE, in consideration of these premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

     1. Definitions.

          (a) Unless otherwise defined herein, capitalized terms used herein
     shall have the meanings ascribed to such terms in the Credit Agreement, and
     the following terms which are defined in the Uniform Commercial Code in
     effect in the State of New York on the date hereof (the "UCC") are used
     herein as so defined: Accession, Account, As-Extracted Collateral, Chattel
     Paper, Commercial Tort Claim, Commingled Goods, Consumer Goods, Deposit
     Account, Document, Equipment, Farm Products, Fixtures, General Intangible,
     Goods, Instrument, Inventory, Investment Property, Letter-of-Credit Right,
     Manufactured Home, Proceeds, Software, Standing Timber, Supporting
     Obligation and Tangible Chattel Paper.

          (b) In addition, the following terms shall have the following
     meanings:

          "Collateral" has the meaning provided in Section 2 hereof.

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          "Copyright Licenses": any written agreement, naming any Obligor as
     licensor, granting any right under any Copyright including, without
     limitation, any thereof referred to in Schedule 6.17 to the Credit
     Agreement.

          "Copyrights": (a) all copyrights registered in the United States or
     any other country in all Works, now existing or hereafter created or
     acquired, all registrations and recordings thereof, and all applications in
     connection therewith, including, without limitation, registrations,
     recordings and applications in the United States Copyright office
     including, without limitation, any thereof referred to in Schedule 6.17 to
     the Credit Agreement, and (b) all renewals thereof including, without
     limitation, any thereof referred to in Schedule 6.17 of the Credit
     Agreement.

          "Indemnified Party": has the meaning provided in Section 8(b) hereof.

          "Patent License": all agreements, whether written or oral, providing
     for the grant by or to an Obligor of any right to manufacture, use or sell
     any invention covered by a Patent, including, without limitation, any
     thereof referred to in Schedule 6.17 of the Credit Agreement.

          "Patents": (a) all letters patent of the United States or any other
     country and all reissues and extensions thereof, including, without
     limitation, any thereof referred to in Schedule 6.17 of the Credit
     Agreement, and (b) all applications for letters patent of the United States
     or any other country and all divisions, continuations and
     continuations-in-part thereof, including, without limitation, any thereof
     referred to in Schedule 6.17 of the Credit Agreement.

          "Secured Obligations": means, without duplication, (i) all of the
     obligations of the Credit Parties to the Collateral Agent and the Lenders,
     under the Credit Agreement or any other Credit Document (including, but not
     limited to, any interest accruing after the commencement of a proceeding by
     or against any Credit Party under any Debtor Relief Laws, regardless of
     whether such interest is an allowed claim under such proceeding), whether
     now existing or hereafter arising, due or to become due, direct or
     indirect, absolute or contingent, howsoever evidenced, created, held or
     acquired, whether primary, secondary, direct, contingent, or joint and
     several, as such obligations may be amended, modified, increased, extended,
     renewed or replaced from time to time and (ii) all costs and expenses
     incurred in connection with enforcement and collection of the obligations
     described in the foregoing clause (i), including Attorney Costs.

          "Trademark License": means any agreement, written or oral, providing
     for the grant by or to an Obligor of any right to use any Trademark,
     including, without limitation, any thereof referred to in Schedule 6.17 of
     the Credit Agreement.

          "Trademarks": (a) all trademarks, trade names, corporate names,
     company names, business names, fictitious business names, trade styles,
     service marks, logos and other

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     source or business identifiers, and the goodwill associated therewith, now
     existing or hereafter adopted or acquired, all registrations and recordings
     thereof, and all applications in connection therewith, whether in the
     United States Patent and Trademark Office or in any similar office or
     agency of the United States, any State thereof or any other country or any
     political subdivision thereof, or otherwise, including, without limitation,
     any thereof referred to in Schedule 6.17 to the Credit Agreement, and (b)
     all renewals thereof.

          "Work": any work which is subject to copyright protection pursuant to
     Title 17 of the United States Code.

     2. Grant of Security Interest in the Collateral. To secure the prompt
payment and performance in full when due, whether by lapse of time,
acceleration, mandatory prepayment or otherwise, of the Secured Obligations,
each Obligor hereby grants to the Collateral Agent, for the benefit of the
Lenders, a continuing security interest in, and a right to set off against, any
and all right, title and interest of such Obligor in and to all personal
property of such Obligor of whatever type or description, whether now owned or
existing or owned, acquired, or arising hereafter, including, without
limitation, the following (collectively, the "Collateral"):

          (a) all Accounts;

          (b) all cash and currency;

          (c) all Chattel Paper;

          (d) all Commercial Tort Claims identified on Schedule 2(d) attached
     hereto;

          (e) all Copyrights;

          (f) all Copyright Licenses;

          (g) all Deposit Accounts;

          (h) all Documents;

          (i) all Equipment;

          (j) all Fixtures;

          (k) all General Intangibles;

          (l) all Goods;

          (m) all Instruments;

          (n) all Inventory;

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          (o) all Investment Property;

          (p) all Letter-of-Credit Rights;

          (q) all Patents;

          (r) all Patent Licenses;

          (s) all Software;

          (t) all Supporting Obligations;

          (u) all Trademarks;

          (v) all Trademark Licenses; and

          (w) to the extent not otherwise included, all Accessions and all
     Proceeds of any and all of the foregoing.

     The Obligors and the Collateral Agent, hereby acknowledge and agree that
the security interest created hereby in the Collateral (i) constitutes
continuing collateral security for all of the Secured Obligations, whether now
existing or hereafter arising and (ii) is not to be construed as an assignment
of any Copyrights, Copyright Licenses, Patents, Patent Licenses, Trademarks or
Trademark Licenses.

     3. Provisions Relating to Accounts.

          (a) Anything herein to the contrary notwithstanding, each of the
     Obligors shall remain liable under each of the Accounts to observe and
     perform all the conditions and obligations to be observed and performed by
     it thereunder, all in accordance with the terms of any agreement giving
     rise to each such Account. Neither the Collateral Agent nor any of the
     Lenders shall have any obligation or liability under any Account (or any
     agreement giving rise thereto) by reason of or arising out of this Security
     Agreement or the receipt by the Collateral Agent or any Lender of any
     payment relating to such Account pursuant hereto, nor shall the Collateral
     Agent nor any Lender be obligated in any manner to perform any of the
     obligations of an Obligor under or pursuant to any Account (or any
     agreement giving rise thereto), to make any payment, to make any inquiry as
     to the nature or the sufficiency of any payment received by it or as to the
     sufficiency of any performance by any party under any Account (or any
     agreement giving rise thereto), to present or file any claim, to take any
     action to enforce any performance or to collect the payment of any amounts
     which may have been assigned to it or to which it may be entitled at any
     time or times.

          (b) Once during each calendar year or at any time after the occurrence
     and during the continuation of an Event of Default, the Collateral Agent
     shall have the right, but

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     not the obligation, to make test verifications of the Accounts in any
     manner and through any medium that it reasonably considers advisable, and
     the Obligors shall furnish all such assistance and information as the
     Collateral Agent may require in connection with such test verifications. At
     any time and from time to time, upon the Collateral Agent's reasonable
     request and at the expense of the Obligors, the Obligors shall cause
     independent public accountants or others satisfactory to the Collateral
     Agent to furnish to the Collateral Agent reports showing reconciliations,
     aging and test verifications of, and trial balances for, the Accounts. The
     Collateral Agent in its own name or in the name of others may communicate
     with account debtors on the Accounts to verify with them to the Collateral
     Agent's reasonable satisfaction the existence, amount and terms of any
     Accounts.

     4. Representations and Warranties. Each Obligor hereby represents and
warrants to the Collateral Agent and each of the Lenders that so long as any of
the Secured Obligations remain outstanding or any Credit Document is in effect:

          (a) Legal Name; Chief Executive Office.

               (i) Each Obligor's exact legal name, taxpayer identification
          number, organization identification number, state of incorporation or
          formation, principal place of business and chief executive office are
          (and for the four months prior to the date hereof has been) as set
          forth on Schedule 4(a)(i) attached hereto.

               (ii) Other than as set forth on Schedule 4(a)(ii) attached
          hereto, no Obligor has been party to a merger, consolidation or other
          change in structure or used any tradename in the four months prior to
          the date hereof.

          (b) Ownership. Each Obligor is the legal and beneficial owner of its
     Collateral and has the right to pledge, sell, assign or transfer the same.

          (c) Security Interest/Priority. This Security Agreement creates a
     valid security interest in favor of the Collateral Agent, for the benefit
     of the Lenders, in the Collateral of such Obligor and, when properly
     perfected by filing, shall constitute a valid perfected security interest
     in such Collateral, to the extent such security interest can be perfected
     by filing under the UCC, free and clear of all Liens except for Permitted
     Liens.

          (d) Types of Collateral. None of the Collateral consists of, or is the
     Accessions or the Proceeds of, As-Extracted Collateral, Consumer Goods,
     Farm Products, Manufactured Homes or Standing Timber.

          (e) Accounts. (i) Each Account of the Obligors and the papers and
     documents relating thereto are genuine and in all material respects what
     they purport to be, (ii) each Account arises out of (A) a bona fide sale of
     goods sold and delivered by such Obligor (or is in the process of being
     delivered) or (B) services theretofore actually rendered by such Obligor
     to, the account debtor named therein, (iii) no Account of an Obligor is
     evidenced by any Instrument or Chattel Paper unless such Instrument or
     Chattel Paper has been

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     theretofore endorsed over and delivered to, or submitted to the control of,
     the Collateral Agent or its designee and (iv) no surety bond was required
     or given in connection with any Account of an Obligor or the contracts or
     purchase orders out of which they arose.

          (f) Inventory. No Inventory is held by an Obligor pursuant to
     consignment, sale or return, sale on approval or similar arrangement.

          (g) Copyrights, Patents and Trademarks.

               (i) Schedule 6.17 to the Credit Agreement includes all
          Copyrights, Copyright Licenses, Patents, Patent Licenses, Trademarks
          and Trademark Licenses owned by any Obligor in its own name, or to
          which any Obligor is party, as of the date hereof.

               (ii) To the best of each Obligor's knowledge, each Copyright,
          Patent and Trademark of such Obligor is valid, subsisting, unexpired,
          enforceable and has not been abandoned.

               (iii) Except as set forth in Schedule 6.17 to the Credit
          Agreement, none of such Copyrights, Patents and Trademarks is the
          subject of any licensing or franchise agreement.

               (iv) No holding, decision or judgment has been rendered by any
          Governmental Authority which would limit, cancel or question the
          validity of any Copyright, Patent or Trademark.

               (v) No action or proceeding is pending seeking to limit, cancel
          or question the validity of any Copyright, Patent or Trademark, or
          which would have a material adverse effect on the value of any
          Copyright, Patent or Trademark.

               (vi) All applications pertaining to the Copyrights, Patents and
          Trademarks of each Obligor have been duly and properly filed, and all
          registrations or letters pertaining to such Copyrights, Patents and
          Trademarks have been duly and properly filed and issued, and all of
          such Copyrights, Patents and Trademarks are valid and enforceable.

               (vii) No Obligor has made any assignment or agreement in conflict
          with the security interest in the Copyrights, Patents or Trademarks of
          each Obligor hereunder.

     5. Covenants. Each Obligor covenants that, so long as any of the Secured
Obligations remain outstanding or any Credit Document is in effect, such Obligor
shall:

          (a) Other Liens. Defend the Collateral against the claims and demands
     of all other parties claiming an interest therein, keep the Collateral free
     from all Liens, except for

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     Permitted Liens, and not sell, exchange, transfer, assign, lease or
     otherwise dispose of the Collateral or any interest therein, except as
     permitted under the Credit Agreement.

          (b) Preservation of Collateral. Keep the Collateral in good order,
     condition and repair and not use the Collateral in violation of the
     provisions of this Security Agreement or any other agreement relating to
     the Collateral or any policy insuring the Collateral or any applicable
     statute, law, bylaw, rule, regulation or ordinance.

          (c) Instruments/Tangible Chattel Paper/Documents. If any amount
     payable under or in connection with any of the Collateral shall be or
     become evidenced by any Instrument or Tangible Chattel Paper, or if any
     property constituting Collateral shall be stored or shipped subject to a
     Document, such Obligor shall ensure that (i) such Instrument, Tangible
     Chattel Paper or Document is either in the possession of such Obligor at
     all times or, if requested by the Collateral Agent, is immediately
     delivered to the Collateral Agent or its designee, duly endorsed in a
     manner satisfactory to the Collateral Agent and (ii) any Collateral
     consisting of Tangible Chattel Paper is marked with a legend acceptable to
     the Collateral Agent indicating the Collateral Agent's security interest in
     such Tangible Chattel Paper.

          (d) Change in Structure, Location or Type. Not, without providing 10
     days prior written notice to the Collateral Agent and without authorizing
     the Collateral Agent to file such financing statements and amendments to
     any previously filed financing statements as the Collateral Agent may
     require, change its name or state of formation or be party to a merger,
     consolidation or other change in structure or use any tradename.

          (e) Inspection. Upon reasonable notice, and during reasonable hours,
     at all times allow the Collateral Agent or its representatives to visit and
     inspect the Collateral as set forth in Section 7.10 of the Credit
     Agreement.

          (f) Authorization. Authorize the Collateral Agent to file one or more
     financing statements disclosing the Collateral Agent's security interest in
     the Collateral. Each Obligor agrees to execute and deliver to the
     Collateral Agent such financing statements and other applicable financing
     statements as may be reasonably requested by the Collateral Agent in order
     to perfect and protect the security interest created hereby in the
     Collateral of such Obligor.

          (g) Perfection of Security Interest. Execute and deliver to the
     Collateral Agent or its designee such agreements, assignments or
     instruments (including affidavits, notices, reaffirmations and amendments
     and restatements of existing documents, as the Collateral Agent may
     reasonably request) and do all such other things as the Collateral Agent
     may reasonably deem necessary or appropriate (i) to assure to the
     Collateral Agent the effectiveness and priority of its security interests
     hereunder, including (A) such financing statements (including renewal
     statements) or amendments thereof or supplements thereto or other
     instruments as the Collateral Agent may from time to time reasonably
     request in order to perfect and maintain the security interests granted
     hereunder in accordance with the

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     UCC, (B) with regard to Copyrights, a Notice of Grant of Security Interest
     in Copyrights for filing with the United States Copyright Office in the
     form of Schedule 5(f)(i) attached hereto, (C) with regard to Patents, a
     Notice of Grant of Security Interest in Patents for filing with the United
     States Patent and Trademark Office in the form of Schedule 5(f)(ii)
     attached hereto and (D) with regard to Trademarks, a Notice of Grant of
     Security Interest in Trademarks for filing with the United States Patent
     and Trademark Office in the form of Schedule 5(f)(iii) attached hereto,
     (ii) to consummate the transactions contemplated hereby and (iii) to
     otherwise protect and reasonably assure the Collateral Agent of its rights
     and interests hereunder. To that end, each Obligor agrees that the
     Collateral Agent may file one or more financing statements (with collateral
     descriptions broader, including without limitation, "all assets" and/or
     "all personal property" collateral descriptions, and/or less specific than
     the description of the Collateral contained herein) disclosing the
     Collateral Agent's security interest in any or all of the Collateral of
     such Obligor without, to the extent permitted by law, such Obligor's
     signature thereon, and further each Obligor also hereby irrevocably makes,
     constitutes and appoints the Collateral Agent, its nominee or any other
     Person whom the Collateral Agent may designate, as such Obligor's
     attorney-in-fact with full power and for the limited purpose to sign in the
     name of such Obligor any such financing statements (including renewal
     statements), amendments and supplements to financing statements, renewal
     financing statements, notices or any similar documents which in the
     Collateral Agent's reasonable discretion would be necessary, appropriate or
     convenient in order to perfect and maintain perfection of the security
     interests granted hereunder, such power, being coupled with an interest,
     being and remaining irrevocable and in effect so long as the Credit
     Agreement is in effect or any amounts payable thereunder or under any other
     Credit Document is in effect. Each Obligor hereby agrees that a carbon,
     photographic or other reproduction of this Security Agreement or any such
     financing statement is sufficient for filing as a financing statement by
     the Collateral Agent without notice thereof to such Obligor wherever the
     Collateral Agent may in its reasonable discretion desire to file the same.
     In the event for any reason the law of any jurisdiction other than New York
     becomes or is applicable to the Collateral of any Obligor or any part
     thereof, or to any of the Secured Obligations, such Obligor agrees to
     execute and deliver all such instruments and to do all such other things as
     the Collateral Agent in its sole discretion reasonably deems necessary or
     appropriate to preserve, protect and enforce the security interests of the
     Collateral Agent under the law of such other jurisdiction (and, if an
     Obligor shall fail to do so promptly upon the request of the Collateral
     Agent, then the Collateral Agent or its designee may execute any and all
     such requested documents on behalf of such Obligor pursuant to the power of
     attorney granted hereinabove). If any Collateral is in the possession or
     control of an Obligor's agents and the Collateral Agent so requests, such
     Obligor agrees to notify such agents in writing of the Collateral Agent's
     security interest therein and, upon the Collateral Agent's request,
     instruct them to hold all such Collateral for the Collateral Agent's (or
     its designee's) account and subject to the Collateral Agent's (or its
     designee's) instructions. Each Obligor agrees to mark its books and records
     to reflect the security interest of the Collateral Agent in the Collateral.

          (h) Control. Execute and deliver all agreements, assignments,
     instruments or other documents as the Collateral Agent shall reasonably
     request for the purpose of

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     obtaining and maintaining control within the meaning of the UCC with
     respect to any Collateral consisting of Deposit Accounts, Investment
     Property, Letter-of-Credit Rights and Electronic Chattel Paper.

          (i) Collateral held by Warehouseman, Bailee, etc. If any Collateral is
     at any time in the possession or control of a warehouseman, bailee, agent
     or processor of such Obligor, (i) notify the Collateral Agent of such
     possession or control, (ii) notify such Person of the Collateral Agent's
     security interest in such Collateral, (iii) instruct such Person to hold
     all such Collateral for the Collateral Agent's (or its designee's) account
     and subject to the Collateral Agent's (or its designee's) instructions and
     (iv) use its best efforts to obtain an acknowledgment from such Person that
     it is holding such Collateral for the benefit of the Collateral Agent and
     the Lenders.

          (j) Treatment of Accounts. Not grant or extend the time for payment of
     any Account, or compromise or settle any Account for less than the full
     amount thereof, or release any Person or property, in whole or in part,
     from payment thereof, or allow any credit or discount thereon, other than
     as normal and customary in the ordinary course of an Obligor's business.

          (k) Covenants Relating to Copyrights.

               (i) Employ the Copyright for each Work with such notice of
          copyright as may be required by law to secure copyright protection.

               (ii) Not do any act or knowingly omit to do any act whereby any
          material Copyright may become invalidated and (A) not do any act, or
          knowingly omit to do any act, whereby any material Copyright may
          become injected into the public domain; (B) notify the Collateral
          Agent immediately if it knows that any material Copyright may become
          injected into the public domain or of any adverse determination or
          development (including, without limitation, the institution of, or any
          such determination or development in, any court or tribunal in the
          United States or any other country) regarding an Obligor's ownership
          of any such Copyright or its validity; (C) take all necessary steps as
          it shall deem appropriate under the circumstances, to maintain and
          pursue each application (and to obtain the relevant registration) and
          to maintain each registration of each material Copyright owned by an
          Obligor including, without limitation, filing of applications for
          renewal where necessary; and (D) promptly notify the Collateral Agent
          of any material infringement of any material Copyright of an Obligor
          of which it becomes aware and take such actions as it shall reasonably
          deem appropriate under the circumstances to protect such Copyright,
          including, where appropriate, the bringing of suit for infringement,
          seeking injunctive relief and seeking to recover any and all damages
          for such infringement.

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               (iii) Not make any assignment or agreement in conflict with the
          security interest in the Copyrights of each Obligor hereunder.

          (l) Covenants Relating to Patents and Trademarks.

               (i) (A) Continue to use each Trademark on each and every
          trademark class of goods applicable to its current line as reflected
          in its current catalogs, brochures and price lists in order to
          maintain such Trademark in full force free from any claim of
          abandonment for non-use, (B) maintain as in the past the quality of
          products and services offered under such Trademark, (C) employ such
          Trademark with the appropriate notice of registration, (D) not adopt
          or use any mark which is confusingly similar or a colorable imitation
          of such Trademark unless the Collateral Agent shall obtain a perfected
          security interest in such mark pursuant to this Security Agreement,
          and (E) not (and not permit any licensee or sublicensee thereof to) do
          any act or knowingly omit to do any act whereby any Trademark may
          become invalidated.

               (ii) Not do any act, or omit to do any act, whereby any Patent
          may become abandoned or dedicated.

               (iii) Notify the Collateral Agent immediately if it knows that
          any application or registration relating to any Patent or Trademark
          may become abandoned or dedicated, or of any adverse determination or
          development (including, without limitation, the institution of, or any
          such determination or development in, any proceeding in the United
          States Patent and Trademark Office or any court or tribunal in any
          country) regarding an Obligor's ownership of any Patent or Trademark
          or its right to register the same or to keep and maintain the same.

               (iv) Whenever an Obligor, either by itself or through an agent,
          employee, licensee or designee, shall file an application for the
          registration of any Patent or Trademark with the United States Patent
          and Trademark Office or any similar office or agency in any other
          country or any political subdivision thereof, such Obligor shall
          report such filing to the Collateral Agent within five Business Days
          after the last day of the fiscal quarter in which such filing occurs.
          Upon request of the Collateral Agent, an Obligor shall execute and
          deliver any and all agreements, instruments, documents and papers as
          the Collateral Agent may reasonably request to evidence the Collateral
          Agent's security interest in any Patent or Trademark and the goodwill
          and general intangibles of an Obligor relating thereto or represented
          thereby.

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               (v) Take all reasonable and necessary steps, including, without
          limitation, in any proceeding before the United States Patent and
          Trademark Office, or any similar office or agency in any other country
          or any political subdivision thereof, to maintain and pursue each
          application (and to obtain the relevant registration) and to maintain
          each registration of the Patents and Trademarks, including, without
          limitation, filing of applications for renewal, affidavits of use and
          affidavits of incontestability.

               (vi) Promptly notify the Collateral Agent after it learns that
          any Patent or Trademark included in the Collateral is infringed,
          misappropriated or diluted by a third party and promptly sue for
          infringement, misappropriation or dilution, to seek injunctive relief
          where appropriate and to recover any and all damages for such
          infringement, misappropriation or dilution, or take such other actions
          as it shall reasonably deem appropriate under the circumstances to
          protect such Patent or Trademark.

               (vii) Not make any assignment or agreement in conflict with the
          security interest in the Patents or Trademarks of each Obligor
          hereunder.

          (m) New Patents, Copyrights and Trademarks. Promptly provide the
     Collateral Agent with (i) a listing of all applications, if any, for new
     Copyrights, Patents or Trademarks (together with a listing of the issuance
     of registrations or letters on present applications), which new
     applications and issued registrations or letters shall be subject to the
     terms and conditions hereunder, and (ii) (A) with respect to Copyrights, a
     duly executed Notice of Security Interest in Copyrights, (B) with respect
     to Patents, a duly executed Notice of Security Interest in Patents, (C)
     with respect to Trademarks, a duly executed Notice of Security Interest in
     Trademarks or (D) such other duly executed documents as the Collateral
     Agent may reasonably request in a form acceptable to counsel for the
     Collateral Agent and suitable for recording to evidence the security
     interest in the Copyright, Patent or Trademark which is the subject of such
     new application.

          (n) Insurance. Insure, repair and replace the Collateral of such
     Obligor as set forth in the Credit Agreement. All insurance proceeds shall
     be subject to the security interest of the Collateral Agent hereunder.

          (o) Commercial Tort Claims.

               (i) Promptly notify the Collateral Agent in writing of the
          initiation of any Commercial Tort Claim before any Governmental
          Authority by or in favor of such Obligor or any of its Subsidiaries.

               (ii) Execute and deliver such statements, documents and notices
          and do and cause to be done all such things as the Collateral Agent
          may reasonably deem necessary, appropriate or convenient, or as are
          required by law, to create, perfect and maintain the Collateral
          Agent's security interest in any Commercial Tort Claim.

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     6. Advances by the Collateral Agent. On failure of any Obligor to perform
any of the covenants and agreements contained herein, the Collateral Agent may,
at its sole option and in its sole discretion, perform the same and in so doing
may expend such sums as the Collateral Agent may reasonably deem advisable in
the performance thereof, including, without limitation, the payment of any
insurance premiums, the payment of any taxes, a payment to obtain a release of a
Lien or potential Lien, expenditures made in defending against any adverse claim
and all other expenditures which the Collateral Agent may make for the
protection of the security hereof or which may be compelled to make by operation
of law. All such sums and amounts so expended shall be repayable by the Obligors
on a joint and several basis promptly upon timely notice thereof and demand
therefor, shall constitute additional Secured Obligations and shall bear
interest from the date said amounts are expended at the Default Rate specified
in Section 3.1 of the Credit Agreement. No such performance of any covenant or
agreement by the Collateral Agent on behalf of any Obligor, and no such advance
or expenditure therefor, shall relieve the Obligors of any default under the
terms of this Security Agreement, the other Credit Documents or any other
documents relating to the Secured Obligations. The Collateral Agent may make any
payment hereby authorized in accordance with any bill, statement or estimate
procured from the appropriate public office or holder of the claim to be
discharged without inquiry into the accuracy of such bill, statement or estimate
or into the validity of any tax assessment, sale, forfeiture, tax lien, title or
claim except to the extent such payment is being contested in good faith by an
Obligor in appropriate proceedings and against which adequate reserves are being
maintained in accordance with GAAP.

     7. Events of Default.

     The occurrence of an event which under the Credit Agreement would
constitute an Event of Default shall be an Event of Default hereunder (an "Event
of Default").

     8. Remedies.

          (a) General Remedies. Upon the occurrence of an Event of Default and
     during continuation thereof, the Collateral Agent shall have, in addition
     to the rights and remedies provided herein, in the Credit Documents, in any
     other documents relating to the Secured Obligations or by law (including,
     but not limited to, levy of attachment, garnishment, and the rights and
     remedies set forth in the Uniform Commercial Code of the jurisdiction
     applicable to the affected Collateral), the rights and remedies of a
     secured party under the UCC (regardless of whether the UCC is the law of
     the jurisdiction where the rights and remedies are asserted and regardless
     of whether the UCC applies to the affected Collateral), and further, the
     Collateral Agent may, with or without judicial process or the aid and
     assistance of others, (i) enter on any premises on which any of the
     Collateral may be located and, without resistance or interference by the
     Obligors, take possession of the Collateral, (ii) dispose of any Collateral
     on any such premises, (iii) require the Obligors to assemble and make
     available to the Collateral Agent at the expense of the Obligors any
     Collateral at any place and time designated by the Collateral Agent which
     is reasonably convenient to both parties, (iv) remove any Collateral from
     any such premises for the purpose of effecting sale

                                      -12-

<PAGE>

     or other disposition thereof, and/or (v) without demand and without
     advertisement, notice, hearing or process of law, all of which each of the
     Obligors hereby waives to the fullest extent permitted by law, at any place
     and time or times, sell and deliver any or all Collateral held by or for it
     at public or private sale, by one or more contracts, in one or more
     parcels, for cash, upon credit or otherwise, at such prices and upon such
     terms as the Collateral Agent deems advisable, in its sole discretion
     (subject to any and all mandatory legal requirements). Each of the Obligors
     acknowledges that any private sale referenced above may be at prices and on
     terms less favorable to the seller than the prices and terms that might
     have been obtained at a public sale and agrees that such private sale shall
     be deemed to have been made in a commercially reasonable manner. Neither
     the Collateral Agent's compliance with applicable law nor its disclaimer of
     warranties relating to the Collateral shall be considered to adversely
     affect the commercial reasonableness of any sale. In addition to all other
     sums due to the Collateral Agent and the Lenders with respect to the
     Secured Obligations, the Obligors shall pay the Collateral Agent and the
     Lenders all reasonable documented costs and expenses incurred by the
     Collateral Agent and the Lenders, including, but not limited to, reasonable
     attorneys' fees and court costs, in obtaining or liquidating the
     Collateral, in enforcing payment of the Secured Obligations, or in the
     prosecution or defense of any action or proceeding by or against the
     Collateral Agent, any Lender or the Obligors concerning any matter arising
     out of or connected with this Security Agreement, any Collateral or the
     Secured Obligations, including, without limitation, any of the foregoing
     arising in, arising under or related to a case under the Debtor Relief
     Laws. To the extent the rights of notice cannot be legally waived
     hereunder, each Obligor agrees that any requirement of reasonable notice
     shall be met if such notice is personally served on or mailed, postage
     prepaid, to the Borrower in accordance with the notice provisions of
     Section 10.1 of the Credit Agreement at least 10 days before the time of
     sale or other event giving rise to the requirement of such notice. The
     Collateral Agent shall not be obligated to make any sale or other
     disposition of the Collateral regardless of notice having been given. To
     the extent permitted by law, the Collateral Agent and any Lender may be a
     purchaser at any such sale. To the extent permitted by applicable law, each
     of the Obligors hereby waives all of its rights of redemption with respect
     to any such sale. Subject to the provisions of applicable law, the
     Collateral Agent may postpone or cause the postponement of the sale of all
     or any portion of the Collateral by announcement at the time and place of
     such sale, and such sale may, without further notice, to the extent
     permitted by law, be made at the time and place to which the sale was
     postponed, or the Collateral Agent may further postpone such sale by
     announcement made at such time and place.

          (b) Remedies Relating to Accounts. Upon the occurrence of an Event of
     Default and during the continuation thereof, whether or not the Collateral
     Agent has exercised any or all of its rights and remedies hereunder, each
     Obligor will, promptly upon request of the Collateral Agent, instruct all
     account debtors to remit all payments in respect of Accounts to a mailing
     location selected by the Collateral Agent (or its designee). In addition,
     the Collateral Agent or its designee shall have the right to enforce any
     Obligor's rights against its customers and account debtors and may notify
     any of Obligor's customers and account debtors that the Accounts of such
     Obligor have been assigned to the Collateral Agent or of the Collateral
     Agent's security interest therein, and may (either in its own name

                                      -13-

<PAGE>

     or in the name of an Obligor or both) demand, collect (including without
     limitation by way of a lockbox arrangement), receive, take receipt for,
     sell, sue for, compound, settle, compromise and give acquittance for any
     and all amounts due or to become due on any Account, and, in the Collateral
     Agent's discretion, file any claim or take any other action or proceeding
     to protect and realize upon the security interest of the Collateral Agent
     in the Accounts. Each Obligor acknowledges and agrees that the Proceeds of
     its Accounts remitted to or on behalf of the Collateral Agent in accordance
     with the provisions hereof shall be solely for the Collateral Agent's own
     convenience and that such Obligor shall not have any right, title or
     interest in such Accounts or in any such other amounts except as expressly
     provided herein. The Collateral Agent shall have no liability or
     responsibility to any Obligor for acceptance in good faith of a check,
     draft or other order for payment of money bearing the legend "payment in
     full" or words of similar import or any other restrictive legend or
     endorsement or be responsible for determining the correctness of any
     remittance. Each Obligor hereby agrees to indemnify the Collateral Agent
     and each Lender from and against all liabilities, damages, losses, actions,
     claims, judgments, costs, expenses, charges and reasonable attorneys' fees
     suffered or incurred by the Collateral Agent or such Lender (each, an
     "Indemnified Party") because of the maintenance of the foregoing
     arrangements except as relating to or arising out of the gross negligence
     or willful misconduct of an Indemnified Party or its officers, employees or
     agents. In the case of any investigation, litigation or other proceeding,
     the foregoing indemnity shall be effective whether or not such
     investigation, litigation or proceeding is brought by an Obligor, its
     directors, shareholders or creditors or an Indemnified Party or any other
     Person or any other Indemnified Party is otherwise a party thereto.

          (c) Access. In addition to the rights and remedies hereunder, upon the
     occurrence of an Event of Default and during the continuance thereof, the
     Collateral Agent shall have the right to enter and remain upon the various
     premises of the Obligors without cost or charge to the Collateral Agent,
     and use the same, together with materials, supplies, books and records of
     the Obligors for the purpose of collecting and liquidating the Collateral,
     or for preparing for sale and conducting the sale of the Collateral,
     whether by foreclosure, auction or otherwise. In addition, the Collateral
     Agent may remove Collateral, or any part thereof, from such premises and/or
     any records with respect thereto, in order to effectively collect or
     liquidate such Collateral.

          (d) Nonexclusive Nature of Remedies. Failure by the Collateral Agent
     or any Lender to exercise any right, remedy or option under this Security
     Agreement, any other Credit Document, any other document relating to the
     Secured Obligations or as provided by law, or any delay by the Collateral
     Agent or any Lender in exercising the same, shall not operate as a waiver
     of any such right, remedy or option. No waiver hereunder shall be effective
     unless it is in writing, signed by the party against whom such waiver is
     sought to be enforced and then only to the extent specifically stated,
     which in the case of the Collateral Agent shall only be granted as provided
     herein. To the extent permitted by law, neither the Collateral Agent, any
     Lender nor any party acting as attorney for the Collateral Agent or any
     Lender, shall be liable hereunder for any acts or omissions or for any
     error of judgment or mistake of fact or law other than their gross
     negligence or willful misconduct

                                      -14-

<PAGE>

     hereunder. The rights and remedies of the Collateral Agent and the Lenders
     under this Security Agreement shall be cumulative and not exclusive of any
     other right or remedy which the Collateral Agent or any Lender may have.

          (e) Retention of Collateral. The Collateral Agent (for the ratable
     benefit of the Lenders) may, after providing the notices required by
     Sections 9-620 and 9-621 of the UCC or otherwise complying with the
     requirements of applicable law of the relevant jurisdiction, accept or
     retain all or any portion of the Collateral in satisfaction of the Secured
     Obligations. Unless and until the Collateral Agent shall have provided such
     notices, however, the Collateral Agent shall not be deemed to have accepted
     or retained any Collateral in satisfaction of any Secured Obligations for
     any reason.

          (f) Deficiency. In the event that the proceeds of any sale, collection
     or realization are insufficient to pay all amounts to which the Collateral
     Agent and each Lender is legally entitled, the Obligors shall be jointly
     and severally liable for the deficiency, together with interest thereon at
     the Default Rate specified in Section 3.1 of the Credit Agreement, together
     with the costs of collection and the reasonable fees of any attorneys
     employed by the Collateral Agent or any Lender to collect such deficiency.
     Any surplus remaining after the full payment and satisfaction of the
     Secured Obligations shall be returned to the Obligors or to whomsoever a
     court of competent jurisdiction shall determine to be entitled thereto.

     9. Rights of the Collateral Agent.

          (a) Power of Attorney. In addition to other powers of attorney
     contained herein, each Obligor hereby designates and appoints the
     Collateral Agent and each of its designees or agents, as attorney-in-fact
     of such Obligor, irrevocably and with power of substitution, with authority
     to take any or all of the following actions upon the occurrence and during
     the continuance of an Event of Default:

               (i) to demand, collect, settle, compromise, adjust, give
          discharges and releases, all as the Collateral Agent may reasonably
          determine;

               (ii) to commence and prosecute any actions at any court for the
          purposes of collecting any Collateral and enforcing any other right in
          respect thereof;

               (iii) to defend, settle or compromise any action brought and, in
          connection therewith, give such discharge or release as the Collateral
          Agent may deem reasonably appropriate;

               (iv) to receive, open and dispose of mail addressed to an Obligor
          and endorse checks, notes, drafts, acceptances, money orders, bills of
          lading, warehouse receipts or other instruments or documents
          evidencing payment,

                                      -15-
<PAGE>

          shipment or storage of the goods giving rise to the Collateral of such
          Obligor on behalf of and in the name of such Obligor, or securing, or
          relating to such Collateral;

               (iii) to pay or discharge taxes, liens, security interests or
          other encumbrances levied or placed on or threatened against the
          Collateral;

               (iv) to direct any parties liable for any payment in connection
          with any of the Collateral to make payment of any and all monies due
          and to become due thereunder directly to the Collateral Agent or as
          the Collateral Agent shall direct;

               (v) to receive payment of and receipt for any and all monies,
          claims, and other amounts due and to become due at any time in respect
          of or arising out of any Collateral;

               (viii) to sell, assign, transfer, make any agreement in respect
          of, or otherwise deal with or exercise rights in respect of, any
          Collateral or the goods or services which have given rise thereto, as
          fully and completely as though the Collateral Agent were the absolute
          owner thereof for all purposes;

               (ix) to adjust and settle claims under any insurance policy
          relating to the Collateral;

               (x) to execute and deliver all assignments, conveyances,
          statements, financing statements, renewal financing statements,
          security and pledge agreements, affidavits, notices and other
          agreements, instruments and documents that the Collateral Agent may
          reasonably determine necessary in order to perfect and maintain the
          security interests and liens granted in this Security Agreement and in
          order to fully consummate all of the transactions contemplated
          therein;

               (xi) to institute any foreclosure proceedings that the Collateral
          Agent may deem appropriate; and

               (xii) to do and perform all such other acts and things as the
          Collateral Agent may reasonably deem to be necessary, proper or
          convenient in connection with the Collateral.

     This power of attorney is a power coupled with an interest and shall be
     irrevocable for so long as any of the Secured Obligations remain
     outstanding or any Credit Document is in effect. The Collateral Agent shall
     be under no duty to exercise or withhold the exercise of any of the rights,
     powers, privileges and options expressly or implicitly granted to the
     Collateral Agent in this Security Agreement, and shall not be liable for
     any failure to do so

                                      -16-

<PAGE>

     or any delay in doing so. The Collateral Agent shall not be liable for any
     act or omission or for any error of judgment or any mistake of fact or law
     in its individual capacity or its capacity as attorney-in-fact except acts
     or omissions resulting from its gross negligence or willful misconduct.
     This power of attorney is conferred on the Collateral Agent solely to
     protect, preserve and realize upon its security interest in the Collateral.

          (b) Performance by the Collateral Agent of Obligations. If any Obligor
     fails to perform any agreement or obligation contained herein, the
     Collateral Agent itself may perform, or cause performance of, such
     agreement or obligation, and the reasonable expenses of the Collateral
     Agent incurred in connection therewith shall be payable by the Obligors on
     a joint and several basis pursuant to Section 24 hereof.

          (c) Assignment by the Collateral Agent and the Lenders. The Collateral
     Agent and each Lender may from time to time assign the Secured Obligations
     and any portion thereof and/or the Collateral and any portion thereof, and
     the assignee shall be entitled to all of the rights and remedies of the
     Collateral Agent or such Lender under this Security Agreement in relation
     thereto.

          (d) The Collateral Agent's Duty of Care. Other than the exercise of
     reasonable care to assure the safe custody of the Collateral while being
     held by the Collateral Agent hereunder, the Collateral Agent shall have no
     duty or liability to preserve rights pertaining thereto, it being
     understood and agreed that the Obligors shall be responsible for
     preservation of all rights in the Collateral, and the Collateral Agent
     shall be relieved of all responsibility for the Collateral upon
     surrendering it or tendering the surrender of it to the Obligors. The
     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
     Collateral Agent accords its own property, which shall be no less than the
     treatment employed by a reasonable and prudent agent in the industry, it
     being understood that the Collateral Agent shall not have responsibility
     for taking any necessary steps to preserve rights against any parties with
     respect to any of the Collateral.

     10. Application of Proceeds. Upon the occurrence and during the continuance
of an Event of Default, any payments in respect of the Secured Obligations and
any proceeds of the Collateral, when received by the Collateral Agent or the
Lenders in cash or its equivalent, will be applied in reduction of the Secured
Obligations in the order set forth in Section 9.3 of the Credit Agreement or
other document relating to the Secured Obligations, and each Obligor irrevocably
waives the right to direct the application of such payments and proceeds and
acknowledges and agrees that the Collateral Agent and the Lenders shall have the
continuing and exclusive right to apply and reapply any and all such payments
and proceeds in the Collateral Agent's and the Lenders' sole discretion,
notwithstanding any entry to the contrary upon any of its books and records.

                                      -17-

<PAGE>

     11. Costs of Counsel. If at any time hereafter, whether upon the occurrence
of an Event of Default or not, the Collateral Agent [or any Lender employs](1)
[and Lenders employ](1) counsel to prepare or consider amendments, waivers or
consents with respect to this Security Agreement, or to take action or make a
response in or with respect to any legal or arbitral proceeding relating to this
Security Agreement or relating to the Collateral, or to protect the Collateral
or exercise any rights or remedies under this Security Agreement or with respect
to the Collateral, then the Obligors agree to promptly pay upon demand any and
all such reasonable documented costs and expenses of such Person, all of which
costs and expenses shall constitute Secured Obligations hereunder.

     12. Continuing Agreement.

          (a) This Security Agreement shall be a continuing agreement in every
     respect and shall remain in full force and effect so long as any of the
     Secured Obligations remain outstanding and the Credit Document shall have
     not been terminated (other than any obligations with respect to the
     indemnities and the representations and warranties set forth in the Credit
     Documents). Upon such payment and termination, this Security Agreement
     shall be automatically terminated and the Collateral Agent shall, upon the
     request and at the expense of the Obligors, forthwith release all of its
     liens and security interests hereunder and shall execute and deliver all
     UCC termination statements and/or other documents reasonably requested by
     the Obligors evidencing such termination. Notwithstanding the foregoing all
     releases and indemnities provided hereunder shall survive termination of
     this Security Agreement.

          (b) This Security Agreement shall continue to be effective or be
     automatically reinstated, as the case may be, if at any time payment, in
     whole or in part, of any of the Secured Obligations is rescinded or must
     otherwise be restored or returned by the Collateral Agent or any Lender as
     a preference, fraudulent conveyance or otherwise under any bankruptcy,
     insolvency or similar law, all as though such payment had not been made;
     provided that in the event payment of all or any part of the Secured
     Obligations is rescinded or must be restored or returned, all reasonable
     costs and expenses (including without limitation any reasonable legal fees
     and disbursements) incurred by the Collateral Agent or any lender in
     defending and enforcing such reinstatement shall be deemed to be included
     as a part of the Secured Obligations.

     13. Amendments; Waivers; Modifications. This Security Agreement and the
provisions hereof may not be amended, waived, modified, changed, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing entered into by, or approved in writing by, the Collateral Agent and
each of the Obligors.

     14. Successors in Interest. This Security Agreement shall create a
continuing security interest in the Collateral and shall be binding upon each
Obligor, its successors and assigns and shall inure, together with the rights
and remedies of the Collateral Agent hereunder, to the Collateral Agent, for the
ratable benefit of the Lenders and each of their successors and permitted

----------
(1)  To be confirmed.

                                      -18-

<PAGE>

assigns; provided, however, that none of the Obligors may assign its rights or
delegate its duties hereunder without the prior written consent of the Required
Lenders. To the fullest extent permitted by law, each Obligor hereby releases
the Collateral Agent and each Lender, and their respective successors and
assigns and their respective officers, attorneys, employees and agents, from any
liability for any act or omission or any error of judgment or mistake of fact or
of law relating to this Security Agreement or the Collateral, except as set
forth in Section 8(d) hereof and except for any liability arising from the gross
negligence or willful misconduct of the Collateral Agent or any Lender,
respectively, or its officers, employees or agents.

     15. Notices. All notices required or permitted to be given under this
Security Agreement shall be in conformance with Section 10.1 of the Credit
Agreement.

     16. Counterparts. This Security Agreement may be executed in any number of
counterparts, each of which where so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument. It
shall not be necessary in making proof of this Security Agreement to produce or
account for more than one such counterpart.

     17. Headings. The headings of the sections and subsections hereof are
provided for convenience only and shall not in any way affect the meaning or
construction of any provision of this Security Agreement.

     18. Governing Law; Submission to Jurisdiction; Venue.

          (a) THIS SECURITY AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
     ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS
     MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE; PROVIDED THAT THE
     COLLATERAL AGENT AND THE LENDERS SHALL RETAIN ALL RIGHTS ARISING UNDER
     FEDERAL LAW.

          (b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS SECURITY
     AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE
     STATE OF NEW YORK SITTING IN NEW YORK COUNTY, NEW YORK OR OF THE UNITED
     STATES FOR THE SOUTHERN DISTRICT OF SUCH STATE, AND BY EXECUTION AND
     DELIVERY OF THIS SECURITY AGREEMENT, EACH CREDIT PARTY, EACH LENDER AND THE
     COLLATERAL AGENT CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO
     THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH CREDIT PARTY, EACH
     LENDER AND THE COLLATERAL AGENT IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING
     ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON
     CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY
     ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY CREDIT DOCUMENT
     OR OTHER DOCUMENT RELATED THERETO. EACH CREDIT PARTY, EACH LENDER AND THE
     COLLATERAL AGENT

                                      -19-

<PAGE>

     WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH
     MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH STATE.

     19. Waiver of Jury Trial. EACH PARTY TO THIS SECURITY AGREEMENT HEREBY
EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION ARISING UNDER THIS SECURITY AGREEMENT OR ANY OTHER CREDIT
DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS
OF THE PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THIS SECURITY AGREEMENT OR
ANY OTHER CREDIT DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR
TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS SECURITY AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE
CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

     20. Severability. If any provision of this Security Agreement is determined
to be illegal, invalid or unenforceable, such provision shall be fully severable
and the remaining provisions shall remain in full force and effect and shall be
construed without giving effect to the illegal, invalid or unenforceable
provisions.

     21. Entirety. This Security Agreement, the other Credit Documents and the
other documents relating to the Secured Obligations represent the entire
agreement of the parties hereto and thereto, and supersede all prior agreements
and understandings, oral or written, if any, including any commitment letters or
correspondence relating to the Credit Documents, any other documents relating to
the Secured Obligations or the transactions contemplated herein and therein.

     22. Survival. All representations and warranties of the Obligors hereunder
shall survive the execution and delivery of this Security Agreement, the other
Credit Documents and the other documents relating to the Secured Obligations,
the delivery of the Notes and the making of the Loans under the Credit
Agreement.

     23. Other Security. To the extent that any of the Secured Obligations are
now or hereafter secured by property other than the Collateral (including,
without limitation, real property and securities owned by an Obligor), or by a
guarantee, endorsement or property of any other Person, then the Collateral
Agent shall have the right to proceed against such other property, guarantee or
endorsement upon the occurrence of any Event of Default, and the Collateral
Agent has the right, in its sole discretion, to determine which rights,
security, liens, security interests or remedies the Collateral Agent shall at
any time pursue, relinquish, subordinate, modify or take with respect thereto,
without in any way modifying or affecting any of them or any of the Collateral

                                      -20-

<PAGE>

Agent's rights or the Secured Obligations under this Security Agreement, under
any other of the Credit Documents or under any other documents relating to the
Secured Obligations.

     24. Joint and Several Obligations of Obligors.

          (a) Each of the Obligors is accepting joint and several liability
     hereunder in consideration of the financial accommodation to be provided by
     the Collateral Agent and the Lenders under the Credit Agreement, for the
     mutual benefit, directly and indirectly, of each of the Obligors and in
     consideration of the undertakings of each of the Obligors to accept joint
     and several liability for the obligations of each of them.

          (b) Each of the Obligors jointly and severally hereby irrevocably and
     unconditionally accepts, not merely as a surety but also as a co-debtor,
     joint and several liability with the other Obligors with respect to the
     payment and performance of all of the Secured Obligations arising under
     this Security Agreement and the other Credit Documents and any other
     documents relating to the Secured Obligations, it being the intention of
     the parties hereto that all the Secured Obligations shall be the joint and
     several obligations of each of the Obligors without preferences or
     distinction among them.

          (c) Notwithstanding any provision to the contrary contained herein, in
     any other of the Credit Documents or in any other documents relating to the
     Secured Obligations, the obligations of each Guarantor under the Credit
     Agreement, the other Credit Documents and the other documents relating to
     the Secured Obligations shall be limited to an aggregate amount equal to
     the largest amount that would not render such obligations subject to
     avoidance under Section 548 of the United States Bankruptcy Code or any
     comparable provisions of any applicable state law.

     25. Intercreditor Agreement. Notwithstanding anything to the contrary in
this Security Agreement, (i) the rights of the Obligors, the Collateral Agent
and the Lenders under this Security Agreement are subject to the terms of the
Intercreditor Agreement, (ii) any obligation of the Obligors in this Security
Agreement that requires delivery of Collateral to, possession or control of
Collateral with, the pledge, assignment, endorsement or transfer of Collateral
to or the registration of Collateral in the name of, the Collateral Agent shall
be deemed complied with and satisfied if such delivery of Collateral is made to,
such possession or control of Collateral is with, or such Collateral be
assigned, endorsed or transferred to or registered in the name of, the Working
Capital Lender, and (iii) in the event of a direct conflict between the terms
and provisions of this Security Agreement and the terms and provisions of the
Intercreditor Agreement, it is the intention of the Obligors, the Collateral
Agent and the Lenders that such provisions shall be read together and construed,
to the fullest extent possible, to be in concert with each other; however, in
the event of any actual, irreconcilable conflict that cannot be resolved as
aforesaid, the terms and provisions of the Intercreditor Agreement shall control
and, in such case, the Obligors shall not be in breach of their obligations
under this Security Agreement as a result of complying with the terms and
provisions of the Intercreditor Agreement; provided that, notwithstanding the
foregoing, nothing contained in this Section 25

                                      -21-

<PAGE>

shall limit or otherwise adversely effect the grant of a lien on or a security
interest in any Collateral under Section 2 of this Security Agreement.

                  [remainder of page intentionally left blank]

                                      -22-

<PAGE>

     Each of the parties hereto has caused a counterpart of this Security
Agreement to be duly executed and delivered as of the date first above written.

OBLIGORS:                               PRG-SCHULTZ USA, INC.,
                                        a Georgia corporation

                                        By: s/
                                            ------------------------------------
                                        Name: James E. Moylan, Jr.
                                        Title: Executive Vice President -
                                               Finance, Chief Financial Officer
                                               and Treasurer

                                        PRG-SCHULTZ INTERNATIONAL, INC.,
                                        a Georgia corporation

                                        By: s/
                                            ------------------------------------
                                        Name: James E. Moylan, Jr.
                                        Title: Executive Vice President -
                                               Finance, Chief Financial Officer
                                               and Treasurer

                                        PRGFS, INC.,
                                        PRGLS, INC.,
                                        each a Delaware corporation

                                        By: s/
                                            ------------------------------------
                                        Name: James E. Moylan, Jr.
                                        Title: Executive Vice President -
                                               Finance

                                        PRGRS, INC., a Delaware corporation

                                        By: s/
                                            ------------------------------------
                                        Name: James B. McCurry
                                        Title: President

<PAGE>

                                        PRG HOLDING CO. (FRANCE) NO. 1, LLC,
                                        PRG HOLDING CO. (FRANCE) NO. 2, LLC,
                                        each a Delaware limited liability
                                        company

                                        By: s/
                                            ------------------------------------
                                        Name: James E. Moylan, Jr.
                                        Title: Executive Vice President -
                                               Finance, Chief Financial Officer
                                               and Treasurer

<PAGE>

OBLIGORS:                               THE PROFIT RECOVERY GROUP ASIA, INC.,
                                        PRG-SCHULTZ CANADA, INC.,
                                        THE PROFIT RECOVERY GROUP NEW ZEALAND,
                                           INC.,
                                        THE PROFIT RECOVERY GROUP NETHERLANDS,
                                           INC.,
                                        THE PROFIT RECOVERY GROUP MEXICO, INC.
                                        PRG-SCHULTZ FRANCE, INC.,
                                        PRG-SCHULTZ AUSTRALIA, INC.,
                                        PRG-SCHULTZ BELGIUM, INC.,
                                        PRG-SCHULTZ CHILE, INC.,
                                        THE PROFIT RECOVERY GROUP GERMANY, INC.,
                                        PRG INTERNATIONAL, INC.,
                                        PRG-SCHULTZ SWITZERLAND, INC.,
                                        THE PROFIT RECOVERY GROUP SOUTH AFRICA,
                                           INC.,
                                        THE PROFIT RECOVERY GROUP SPAIN, INC.,
                                        THE PROFIT RECOVERY GROUP ITALY, INC.,
                                        PRG-SCHULTZ SCANDINAVIA, INC.,
                                        PRG-SCHULTZ PORTUGAL, INC.,
                                        PRG-SCHULTZ JAPAN, INC.,
                                        THE PROFIT RECOVERY GROUP COSTA RICA,
                                           INC.,
                                        PRG-SCHULTZ PUERTO RICO, INC.,
                                        PRG USA, INC.,
                                        PRG-SCHULTZ EUROPE, INC.,
                                        EACH A GEORGIA CORPORATION

                                        By: s/
                                            ------------------------------------
                                        Name: James E. Moylan, Jr.
                                        Title: Executive Vice President -
                                               Finance, Chief Financial Officer
                                               and Treasurer

                                        HS&A ACQUISITION - UK, INC.,
                                        a Texas corporation

                                        By: s/
                                            ------------------------------------
                                        Name: James E. Moylan, Jr.
                                        Title: Executive Vice President -
                                               Finance, Chief Financial Officer
                                               and Treasurer

<PAGE>

COLLATERAL AGENT:                       BLUM STRATEGIC PARTNERS II, L.P.

                                        By: s/
                                            ------------------------------------
                                        Name: Jose Medeiros
                                        Title: Partner

<PAGE>

                                    SCHEDULES

<TABLE>
<S>                  <C>
Schedule 2(d)        Commercial Tort Claims

Schedule 4(a)        Mergers, Consolidations, Changes in Structure, Use of
                     Tradenames

Schedule 5(f)(i)     Notice of Grant of Security Interest in Copyrights

Schedule 5(f)(ii)    Notice of Grant of Security Interest in Patents

Schedule 5(f)(iii)   Notice of Grant of Security Interest in Trademarks
</TABLE>

<PAGE>

                                SCHEDULE 5(f)(i)

                                     NOTICE

                                       OF

                           GRANT OF SECURITY INTEREST

                                       IN

                                   COPYRIGHTS

United States Copyright Office

Ladies and Gentlemen:

     Please be advised that pursuant to the Security Agreement dated as of
December ___, 2005 (as the same may be amended, modified, extended or restated
from time to time, the "Security Agreement") by and among the Obligors party
thereto (each an "Obligor" and collectively, the "Obligors") and Blum Strategic
Partners II, L.P. (the "Collateral Agent"), the undersigned Obligor has granted
a continuing security interest in and continuing lien upon, the copyrights and
copyright applications shown below to the Collateral Agent, for the benefit of
the Lenders:

                                   COPYRIGHTS

<TABLE>
<CAPTION>
                                            Date of
Copyright No.   Description of Copyright   Copyright
-------------   ------------------------   ---------
<S>             <C>                        <C>

</TABLE>

                             Copyright Applications

<TABLE>
<CAPTION>
    Copyright      Description of Copyright   Date of Copyright
Applications No.          Applied For            Applications
----------------   ------------------------   -----------------
<S>                <C>                        <C>

</TABLE>

<PAGE>

     The Obligors and the Collateral Agent hereby acknowledge and agree that the
security interest in the foregoing copyrights and copyright applications (i) may
only be terminated in accordance with the terms of the Security Agreement and
(ii) is not to be construed as an assignment of any copyright or copyright
application.

                                        Very truly yours,

                                        _______________________________________,

                                        a _________________ corporation

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

                                        Obligor's Address:

                                        ----------------------------------------

                                        ----------------------------------------

Acknowledged and Accepted:

Blum Strategic Partners II, L.P., as Collateral Agent

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

<PAGE>

                                SCHEDULE 5(f)(ii)

                                     NOTICE

                                       OF

                           GRANT OF SECURITY INTEREST

                                       IN

                                     PATENTS

United States Patent and Trademark Office

Ladies and Gentlemen:

     Please be advised that pursuant to the Security Agreement dated as of
December ___, 2005 (the "Security Agreement") by and among the Obligors party
thereto (each an "Obligor" and collectively, the "Obligors") and Blum Strategic
Partners II, L.P. (the "Collateral Agent"), the undersigned Obligor has granted
a continuing security interest in and continuing lien upon, the patents and
patent applications shown below to the Collateral Agent, for the benefit of the
Lenders:

                                     PATENTS

<TABLE>
<CAPTION>
             Description of Patent   Date of
Patent No.            Item            Patent
----------   ---------------------   -------
<S>          <C>                     <C>

</TABLE>

                               Patent Applications

<TABLE>
<CAPTION>
    Patent         Description of Patent   Date of Patent
Applications No.        Applied For         Applications
----------------   ---------------------   --------------
<S>                <C>                     <C>

</TABLE>

<PAGE>

     The Obligors and the Collateral Agent hereby acknowledge and agree that the
security interest in the foregoing patents and patent applications (i) may only
be terminated in accordance with the terms of the Security Agreement and (ii) is
not to be construed as an assignment of any patent or patent application.

                                        Very truly yours,

                                        _______________________________________,

                                        a _________________ corporation

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

                                        Obligor's Address:

                                        ----------------------------------------

                                        ----------------------------------------

Acknowledged and Accepted:

Blum Strategic Partners II, L.P., as Collateral Agent

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

<PAGE>

                               SCHEDULE 5(f)(iii)

                                     NOTICE

                                       OF

                           GRANT OF SECURITY INTEREST

                                       IN

                                   TRADEMARKS

United States Patent and Trademark Office

Ladies and Gentlemen:

     Please be advised that pursuant to the Security Agreement dated as of
December ___, 2005 (the "Security Agreement") by and among the Obligors party
thereto (each an "Obligor" and collectively, the "Obligors") and Blum Strategic
Partners II, L.P. (the "Collateral Agent"), the undersigned Obligor has granted
a continuing security interest in and continuing lien upon, the trademarks and
trademark applications shown below to the Collateral Agent, for the benefit of
the Lenders:

                          TRADEMARKS

<TABLE>
<CAPTION>
                Description of Trademark    Date of
Trademark No.             Item             Trademark
-------------   ------------------------   ---------
<S>             <C>                        <C>

</TABLE>

                             Trademark Applications

<TABLE>
<CAPTION>
   Trademark       Description of Trademark   Date of Trademark
Applications No.         Applied For             Applications
----------------   ------------------------   -----------------
<S>                <C>                        <C>

</TABLE>

<PAGE>

     The Obligors and the Collateral Agent hereby acknowledge and agree that the
security interest in the foregoing trademarks and trademark applications (i) may
only be terminated in accordance with the terms of the Security Agreement and
(ii) is not to be construed as an assignment of any trademark or trademark
application.

                                        Very truly yours,

                                        _______________________________________,

                                        a ___________ corporation

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

                                        Obligor's Address:

                                        ----------------------------------------

                                        ----------------------------------------

Acknowledged and Accepted:

Blum Strategic Partners II, L.P., as
Collateral Agent

By:
    ---------------------------------
Name:
      -------------------------------
Title:
       ------------------------------<PAGE>

                                PLEDGE AGREEMENT

          THIS PLEDGE AGREEMENT (this "Pledge Agreement") is entered into as of
December 23, 2005 among PRG-SCHULTZ USA, INC., a Georgia corporation (the
"Borrower"), PRG-SCHULTZ INTERNATIONAL, INC., a Georgia corporation (the
"Parent"), certain of the Domestic Subsidiaries of the Parent (such Domestic
Subsidiaries, together with the Parent, individually a "Guarantor", and
collectively the "Guarantors"; the Guarantors together with the Borrower,
individually a "Pledgor", and collectively the 'Pledgors") and Blum Strategic
Partners II, L.P., as the collateral agent for the Lenders referred to below (in
such capacity together with its successors and permitted assigns, the
"Collateral Agent").

                                    RECITALS

          WHEREAS, pursuant to that certain Credit Agreement dated as of the
date hereof (as amended, modified, extended, renewed or replaced from time to
time, the "Credit Agreement"), among the Borrower, the Guarantors, the lenders
from time to time party thereto (each a "Lender" and collectively, the
"Lenders") and the Collateral Agent, each of the Lenders, severally and not
jointly or jointly and severally, has agreed to make the Loans upon the terms
and subject to the conditions set forth therein; and

          WHEREAS, it is a condition precedent to the effectiveness of the
Credit Agreement and the obligations of the Lenders to make the Loans under the
Credit Agreement that the Pledgors shall have executed and delivered this Pledge
Agreement to the Collateral Agent for the benefit of the Lenders.

          NOW, THEREFORE, in consideration of these premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:

          1. Definitions.

               (a) Unless otherwise defined herein, capitalized terms used
          herein shall have the meanings ascribed to such terms in the Credit
          Agreement, and the following terms which are defined in the Uniform
          Commercial Code as in effect in the State of New York on the date
          hereof (the "UCC"), are used herein as so defined: Accession,
          Financial Asset, Proceeds and Security.

               (b) In addition, the following term shall have the following
          meaning:

          "Secured Obligations": means, without duplication, (i) all of the
obligations of the Credit Parties to the Collateral Agent and the Lenders, under
the Credit Agreement or any other Credit Document (including, but not limited
to, any interest accruing after the commencement of a proceeding by or against
any Credit Party under any Debtor Relief Laws, regardless of whether such
interest is an allowed claim under such proceeding), whether now existing or
hereafter arising, due or to become due, direct or indirect, absolute or
contingent, howsoever evidenced, created, held or acquired, whether primary,
secondary, direct, contingent,

<PAGE>

or joint and several, as such obligations may be amended, modified, increased,
extended, renewed or replaced from time to time and (ii) all costs and expenses
incurred in connection with enforcement and collection of the obligations
described in the foregoing clause (i), including Attorney Costs.

          2. Pledge and Grant of Security Interest. To secure the prompt payment
and performance in full when due, whether by lapse of time, acceleration,
mandatory prepayment or otherwise, of the Secured Obligations, each Pledgor
hereby pledges and assigns to the Collateral Agent, and grants to the Collateral
Agent, in each case, for the benefit of the Lenders, a continuing security
interest in, and a right to set-off against, any and all right, title and
interest of such Pledgor in and to the following, whether now owned or existing
or owned, acquired, or arising hereafter (collectively, the "Pledged
Collateral"):

               (a) Pledged Shares. (i) 100% (or, if less, the full amount owned
          by such Pledgor) of the issued and outstanding Capital Stock owned by
          such Pledgor of each Domestic Subsidiary of such Pledgor set forth on
          Schedule 2(a) attached hereto and (ii) 66% of the issued and
          outstanding shares of Capital Stock entitled to vote (within the
          meaning of Treas. Reg. Section 1.956-2(c)(2)) ("Voting Equity") and
          100% (or, if less, the full amount owned by such Pledgor) of the
          issued and outstanding Capital Stock not entitled to vote (within the
          meaning of Treas. Reg. Section 1.956-2(c)(2)) ("Non-Voting Equity")
          owned by such Pledgor of each Material Foreign Subsidiary set forth on
          Schedule 2(a) attached hereto, in each case together with the
          certificates (or other agreements or instruments), if any,
          representing such Capital Stock, and all options and other rights,
          contractual or otherwise, with respect thereto (collectively, together
          with the Capital Stock described in Section 2(b) and 2(c) below, the
          "Pledged Shares"), including, but not limited to, the following:

                    (A) all shares, securities, membership interests or other
               equity interests representing a dividend on any of the Pledged
               Shares, or representing a distribution or return of capital upon
               or in respect of the Pledged Shares, or resulting from a stock
               split, revision, reclassification or other exchange therefor, and
               any subscriptions, warrants, rights or options issued to the
               holder of, or otherwise in respect of, the Pledged Shares; and

                    (B) without affecting the obligations of the Pledgors under
               any provision prohibiting such action hereunder or under the
               Credit Agreement, in the event of any consolidation or merger
               involving the issuer of any Pledged Shares and in which such
               issuer is not the surviving entity, all Capital Stock of the
               successor entity formed by or resulting from such consolidation
               or merger.

               (b) Additional Shares. 100% (or, if less, the full amount owned
          by such Pledgor) of the issued and outstanding Capital Stock owned by
          such Pledgor of any Person which hereafter becomes a Domestic
          Subsidiary of such Pledgor and 66% of the Voting Equity and 100% (or,
          if less, the full amount owned by such Pledgor) of the Non-Voting
          Equity owned by such Pledgor of any Person which hereafter becomes a
          Material Foreign Subsidiary of such Pledgor,

                                        2

<PAGE>

          including, without limitation, the certificates (or other agreements
          or instruments) representing such Capital Stock.

               (c) Accessions and Proceeds. All Accessions and Proceeds of the
          foregoing, however and whenever acquired and in whatever form.

          Without limiting the generality of the foregoing, it is hereby
specifically understood and agreed that a Pledgor may from time to time
hereafter deliver additional Capital Stock to the Collateral Agent (or its
designee) as collateral security for the Secured Obligations. Upon delivery to
the Collateral Agent (or its designee), such additional Capital Stock shall be
deemed to be part of the Pledged Collateral of such Pledgor and shall be subject
to the terms of this Pledge Agreement whether or not Schedule 2(a) is amended to
refer to such additional Capital Stock.

          3. Security for Secured Obligations. The security interest created
hereby in the Pledged Collateral of each Pledgor constitutes continuing
collateral security for all of the Secured Obligations.

          4. Delivery of the Pledged Collateral. Each Pledgor hereby agrees
that:

               (a) Delivery of Certificates. Each Pledgor shall, deliver to the
          Collateral Agent (or its designee) (i) simultaneously with or prior to
          the execution and delivery of this Pledge Agreement, all certificates
          representing the Pledged Shares of such Pledgor and (ii) promptly upon
          the receipt thereof by or on behalf of a Pledgor, all other
          certificates and instruments constituting Pledged Collateral of a
          Pledgor. Prior to delivery to the Collateral Agent (or its designee),
          all such certificates and instruments constituting Pledged Collateral
          of a Pledgor shall be held in trust by such Pledgor for the benefit of
          the Collateral Agent pursuant hereto. All such certificates shall be
          delivered in suitable form for transfer by delivery or shall be
          accompanied by duly executed instruments of transfer or assignment in
          blank, substantially in the form provided in Exhibit 4(a) attached
          hereto.

               (b) Additional Securities. If such Pledgor shall receive by
          virtue of its being or having been the owner of any Pledged
          Collateral, any (i) certificate, including without limitation, any
          certificate representing a dividend or distribution in connection with
          any increase or reduction of capital, reclassification, merger,
          consolidation, sale of assets, combination of shares, or other equity
          interests, stock splits, spin-off or split-off, promissory notes or
          other instruments; (ii) option or right, whether as an addition to,
          substitution for, or an exchange for, any Pledged Collateral or
          otherwise; (iii) dividends payable in securities; or (iv)
          distributions of securities in connection with a partial or total
          liquidation, dissolution or reduction of capital, capital surplus or
          paid-in surplus, then such Pledgor shall receive such certificate,
          instrument, option, right or distribution in trust for the benefit of
          the Collateral Agent, shall segregate it from such Pledgor's other
          property and shall deliver it forthwith to the Collateral Agent (or
          its designee) in the exact form received together with any necessary
          endorsement and/or appropriate stock power duly executed in blank,
          substantially in the form provided in Exhibit 4(a), to be held by the
          Collateral

                                        3

<PAGE>

          Agent (or its designee) as Pledged Collateral and as further
          collateral security for the Secured Obligations.

               (c) Financing Statements. Each Pledgor authorizes the Collateral
          Agent to file one or more financing statements disclosing the
          Collateral Agent's security interest in the Pledged Collateral
          (including any financing statement indicating that the Collateral is
          "all assets" or "all personal property" or words of similar effect or
          describing or identifying the Collateral by type or in any manner as
          the Collateral Agent may determine). Each Pledgor agrees to execute
          and deliver to the Collateral Agent such financing statements and
          other applicable financing statements as may be reasonably requested
          by the Collateral Agent in order to perfect and protect the security
          interest created hereby in the Pledged Collateral of such Pledgor.

          5. Representations and Warranties. Each Pledgor hereby represents and
warrants to the Collateral Agent and each Lender, that so long as any of the
Secured Obligations remain outstanding or any Credit Document is in effect:

               (a) Authorization of Pledged Shares. The Pledged Shares are duly
          authorized and validly issued, are fully paid and, except for Pledged
          Shares which are shares (the "ULC Shares") in PRG-Schultz Canada Corp.
          ("PRG-Schultz Canada"), a Nova Scotia unlimited liability company (the
          "ULC"), nonassessable and are not subject to the preemptive rights of
          any Person. All other Capital Stock constituting Pledged Collateral
          will be duly authorized and validly issued, fully paid and, except for
          Pledged Shares which are ULC Shares, nonassessable and not subject to
          the preemptive rights of any Person.

               (b) Title. Each Pledgor has good and indefeasible title to the
          Pledged Collateral of such Pledgor and will at all times be the legal
          and beneficial owner of such Pledged Collateral free and clear of any
          Lien, other than Permitted Liens. There exists no "adverse claim"
          within the meaning of Section 8-102 of the Uniform Commercial Code as
          in effect in the State of New York (the "UCC") with respect to the
          Pledged Shares of such Pledgor.

               (c) Exercising of Rights. Neither the exercise by the Collateral
          Agent or any Lender of its rights and remedies hereunder nor the
          execution, delivery or performance of this Agreement by the Pledgor
          will violate any law or governmental regulation or any material
          contractual restriction binding on or affecting a Pledgor or any of
          its property.

               (d) Pledgor's Authority. No authorization, approval or action by,
          and no notice or filing with any Governmental Authority or with the
          issuer of any Pledged Shares is required either (i) for the pledge
          made by a Pledgor or for the granting of the security interest by a
          Pledgor pursuant to this Pledge Agreement (except as have already been
          obtained) or (ii) for the exercise by the Collateral Agent or any
          Lender of its rights and remedies hereunder (except as may be required
          by laws affecting the offering and sale of securities).

                                        4

<PAGE>

               (e) Security Interest/Priority. This Pledge Agreement creates a
          valid security interest in favor of the Collateral Agent, for the
          benefit of the Lenders, in the Pledged Collateral. The delivery to the
          Collateral Agent (or its designee) of certificates evidencing the
          Pledged Collateral, together with duly executed stock powers in
          respect thereof, will perfect and establish the first priority
          (subject in priority solely to the Liens in favor of the Working
          Capital Lender) of the Collateral Agent's security interest in any
          certificated Pledged Collateral that constitutes a Security. The
          filing of appropriate UCC financing statements in the appropriate
          filing offices in the jurisdiction of organization of the applicable
          Pledgor or obtaining "control" over such interests in accordance with
          the provisions of Section 8-106 of the UCC will perfect and establish
          the first priority (subject in priority solely to the Liens in favor
          of the Working Capital Lender) of the Collateral Agent's security
          interest in any uncertificated Pledged Collateral that constitutes a
          Security. The filing of appropriate UCC financing statements in the
          appropriate filing offices in the jurisdiction of organization of the
          applicable Pledgor will perfect and establish the first priority
          (subject in priority solely to the Liens in favor of the Working
          Capital Lender) of the Collateral Agent's security interest in any
          Pledged Collateral that does not constitute a Security. Except as set
          forth in this Section 5(e), no action is necessary to perfect or
          otherwise protect such security interest.

               (f) Partnership and Membership Interests. Except as previously
          disclosed to the Lenders, none of the Pledged Shares consisting of
          partnership or limited liability company interests (i) is dealt in or
          traded on a securities exchange or in a securities market, (ii) by its
          terms expressly provides that it is a security governed by Article 8
          of the UCC, (iii) is an investment company security, (iv) is held in a
          securities account or (v) constitutes a Security or a Financial Asset.

               (g) No Other Interests. No Pledgor owns any Capital Stock in any
          Subsidiary other than as set forth on Schedule 2(a) attached hereto.

          6. Covenants. Each Pledgor hereby covenants, that so long as any of
the Secured Obligations remain outstanding or any Credit Document is in effect,
such Pledgor shall:

               (a) Books and Records. Mark its books and records (and shall
          cause the issuer of the Pledged Shares of such Pledgor to mark its
          books and records) to reflect the security interest granted to the
          Collateral Agent pursuant to this Pledge Agreement.

               (b) Defense of Title. Warrant and defend title to and ownership
          of the Pledged Collateral of such Pledgor at its own expense against
          the claims and demands of all other parties claiming an interest
          therein, keep the Pledged Collateral free from all Liens, except for
          Permitted Liens, and not sell, exchange, transfer, assign, lease or
          otherwise dispose of Pledged Collateral of such Pledgor or any
          interest therein, except as permitted under the Credit Agreement and
          the other Credit Documents.

                                        5

<PAGE>

               (c) Further Assurances. Promptly execute and deliver at its
          expense all further instruments and documents and take all further
          action that may be reasonably necessary and desirable or that the
          Collateral Agent may reasonably request in order to (i) perfect and
          protect the security interest created hereby in the Pledged Collateral
          of such Pledgor (including without limitation any and all action
          necessary to reasonably satisfy the Collateral Agent that the
          Collateral Agent has obtained a first priority (subject in priority
          solely to the Liens in favor of the Working Capital Lender) perfected
          security interest in any Capital Stock); (ii) enable the Collateral
          Agent or any Lender to exercise and enforce its rights and remedies
          hereunder in respect of the Pledged Collateral of such Pledgor; and
          (iii) otherwise effect the purposes of this Pledge Agreement,
          including, without limitation, and if requested by the Collateral
          Agent, delivering to the Collateral Agent (or its designees)
          irrevocable proxies in respect of the Pledged Collateral of such
          Pledgor upon the occurrence of and during the continuation of an Event
          of Default.

               (d) Amendments. Not make or consent to any amendment or other
          modification or waiver with respect to any of the Pledged Collateral
          of such Pledgor or enter into any agreement or allow to exist any
          restriction with respect to any of the Pledged Collateral of such
          Pledgor other than pursuant hereto.

               (e) Compliance with Securities Laws. File all reports and other
          information now or hereafter required to be filed by such Pledgor with
          the United States Securities and Exchange Commission and any other
          state, federal or foreign agency in connection with the ownership of
          the Pledged Collateral of such Pledgor.

               (f) Issuance or Acquisition of Capital Stock. Not, without
          executing and delivering, or causing to be executed and delivered, to
          the Collateral Agent (or its designees) such agreements, documents and
          instruments as the Collateral Agent may reasonably require, issue or
          acquire any Capital Stock consisting of an interest in a partnership
          or a limited liability company that (i) is dealt in or traded on a
          securities exchange or in a securities market, (ii) by its terms
          expressly provides that it is a security governed by Article 8 of the
          UCC, (iii) is an investment company security, (iv) is held in a
          securities account or (v) constitutes a Security or a Financial Asset.

               (g) Authorization. Authorize the Collateral Agent to prepare and
          file such financing statements (including renewal statements),
          amendments and supplements or such other instruments as the Collateral
          Agent may from time to time reasonably deem necessary, appropriate or
          convenient in order to perfect and maintain the security interests
          granted hereunder in accordance with the UCC.

          7. Advances by Collateral Agent. On failure of any Pledgor to perform
any of the covenants and agreements contained herein, the Collateral Agent may,
at its sole option and in its sole discretion, perform the same and in so doing
may expend such sums as the Collateral Agent may reasonably deem advisable in
the performance thereof, including, without limitation, the payment of any
insurance premiums, the payment of any taxes, a payment to obtain a release

                                        6

<PAGE>

of a Lien or potential Lien, expenditures made in defending against any adverse
claim and all other expenditures which the Collateral Agent may make for the
protection of the security hereof or which may be compelled to make by operation
of law. All such sums and amounts so expended shall be repayable by the Pledgors
on a joint and several basis promptly upon timely notice thereof and demand
therefor, shall constitute additional Secured Obligations and shall bear
interest from the date said amounts are expended at the Default Rate specified
in Section 3.1 of the Credit Agreement. No such performance of any covenant or
agreement by the Collateral Agent on behalf of any Pledgor, and no such advance
or expenditure therefor, shall relieve the Pledgors of any default under the
terms of this Pledge Agreement, the other Credit Documents or any other
documents relating to the Secured Obligations. The Collateral Agent may make any
payment hereby authorized in accordance with any bill, statement or estimate
procured from the appropriate public office or holder of the claim to be
discharged without inquiry into the accuracy of such bill, statement or estimate
or into the validity of any tax assessment, sale, forfeiture, tax lien, title or
claim except to the extent such payment is being contested in good faith by a
Pledgor in appropriate proceedings and against which adequate reserves are being
maintained in accordance with GAAP.

          8. Events of Default. The occurrence of an event which under the
Credit Agreement would constitute an Event of Default shall be an Event of
Default hereunder (an "Event of Default").

          9. Remedies.

               (a) General Remedies. Upon the occurrence of an Event of Default
          and during the continuation thereof, the Collateral Agent shall have,
          (i) in respect of the Pledged Collateral of any Pledgor, except for
          Pledged Collateral consisting of ULC Shares, in addition to the rights
          and remedies provided herein, in any other documents relating to the
          Secured Obligations, in the Credit Documents or by law, the rights and
          remedies of a secured party under the UCC or any other applicable law
          and (ii) in respect of any PRG-Schultz Canada's Pledged Collateral
          consisting of ULC Shares, the rights and remedies described in this
          Section 9.

               (b) Sale of Pledged Collateral. Upon the occurrence of an Event
          of Default and during the continuation thereof, without limiting the
          generality of this Section 9 and without notice, the Collateral Agent
          may, in its sole discretion, sell or otherwise dispose of or realize
          upon the Pledged Collateral, or any part thereof, in one or more
          parcels, at public or private sale, at any exchange or broker's board
          or elsewhere, at such price or prices and on such other terms as the
          Collateral Agent may deem commercially reasonable, for cash, credit or
          for future delivery or otherwise in accordance with applicable law. To
          the extent permitted by law, the Collateral Agent and any Lender may
          in such event, bid for the purchase of such securities. Each Pledgor
          agrees that, to the extent notice of sale shall be required by law and
          has not been waived by such Pledgor, any requirement of reasonable
          notice shall be met if notice, specifying the place of any public sale
          or the time after which any private sale is to be made, is personally
          served on or mailed, postage prepaid, to such Pledgor, in accordance
          with the notice provisions of Section 10.1 of the Credit Agreement at
          least 10

                                        7

<PAGE>

          days before the time of such sale. The Collateral Agent shall not be
          obligated to make any sale of Pledged Collateral of such Pledgor
          regardless of notice of sale having been given. The Collateral Agent
          may adjourn any public or private sale from time to time by
          announcement at the time and place fixed therefor, and such sale may,
          without further notice, be made at the time and place to which it was
          so adjourned.

               (c) Private Sale. Upon the occurrence of an Event of Default and
          during the continuation thereof, the Pledgors recognize that the
          Collateral Agent may deem it impracticable to effect a public sale of
          all or any part of the Pledged Shares or any of the securities
          constituting Pledged Collateral and that the Collateral Agent may,
          therefore, determine to make one or more private sales of any such
          securities to a restricted group of purchasers who will be obligated
          to agree, among other things, to acquire such securities for their own
          account, for investment and not with a view to the distribution or
          resale thereof. Each Pledgor acknowledges that any such private sale
          may be at prices and on terms less favorable to the seller than the
          prices and other terms which might have been obtained at a public sale
          and, notwithstanding the foregoing, agrees that such private sale
          shall be deemed to have been made in a commercially reasonable manner
          and that the Collateral Agent shall have no obligation to delay sale
          of any such securities for the period of time necessary to permit the
          issuer of such securities to register such securities for public sale
          under the Securities Act of 1933. Each Pledgor further acknowledges
          and agrees that any offer to sell such securities which has been (i)
          publicly advertised on a bona fide basis in a newspaper or other
          publication of general circulation in the financial community of New
          York, New York (to the extent that such offer may be advertised
          without prior registration under the Securities Act of 1933), or (ii)
          made privately in the manner described above shall be deemed to
          involve a "public sale" under the UCC, notwithstanding that such sale
          may not constitute a "public offering" under the Securities Act of
          1933, and the Collateral Agent may, in such event, bid for the
          purchase of such securities.

               (d) Retention of Pledged Collateral. In addition to the rights
          and remedies hereunder, upon the occurrence of an Event of Default,
          the Collateral Agent (for the ratable benefit of the Lenders) may,
          after providing the notices required by Sections 9-620 and 9-621 of
          the UCC or otherwise complying with the requirements of applicable law
          of the relevant jurisdiction, accept or retain all or any portion of
          the Pledged Collateral in satisfaction of the Secured Obligations.
          Unless and until the Collateral Agent shall have provided such
          notices, however, the Collateral Agent shall not be deemed to have
          accepted or retained any Pledged Collateral in satisfaction of any
          Secured Obligations for any reason.

               (e) Deficiency. In the event that the proceeds of any sale,
          collection or realization are insufficient to pay all amounts to which
          the Collateral Agent and the Lenders are legally entitled, the
          Pledgors shall be jointly and severally liable for the deficiency,
          together with interest thereon at the Default Rate specified in
          Section 3.1 of the Credit Agreement, together with the costs of

                                        8

<PAGE>

          collection and the reasonable fees of any attorneys employed by the
          Collateral Agent or any Lender to collect such deficiency. Any surplus
          remaining after the full payment and satisfaction of the Secured
          Obligations shall be returned to the Pledgors or to whomsoever a court
          of competent jurisdiction shall determine to be entitled thereto.

          10. Rights of the Collateral Agent.

               (a) Power of Attorney. In addition to other powers of attorney
          contained herein, each Pledgor hereby designates and appoints the
          Collateral Agent and each of its designees or agents as
          attorney-in-fact of such Pledgor, irrevocably and with power of
          substitution, with authority to take any or all of the following
          actions (in the case of PRG-Schultz Canada's Pledged Collateral
          consisting of ULC Shares, such actions to be taken in the name of
          PRG-Schultz Canada and not in the Collateral Agent's own behalf) upon
          the occurrence and during the continuance of an Event of Default:

                         (i) to demand, collect, settle, compromise, adjust and
                    give discharges and releases concerning the Pledged
                    Collateral of such Pledgor, all as the Collateral Agent may
                    reasonably determine;

                         (ii) to commence and prosecute any actions at any court
                    for the purposes of collecting any of the Pledged Collateral
                    of such Pledgor and enforcing any other right in respect
                    thereof;

                         (iii) to defend, settle or compromise any action
                    brought and, in connection therewith, give such discharge or
                    release as the Collateral Agent may deem reasonably
                    appropriate;

                         (iv) to pay or discharge taxes, liens, security
                    interests, or other encumbrances levied or placed on or
                    threatened against the Pledged Collateral of such Pledgor;

                         (v) to direct any parties liable for any payment under
                    any of the Pledged Collateral to make payment of any and all
                    monies due and to become due thereunder directly to the
                    Collateral Agent or as the Collateral Agent shall direct;

                         (vi) to receive payment of and receipt for any and all
                    monies, claims, and other amounts due and to become due at
                    any time in respect of or arising out of any Pledged
                    Collateral of such Pledgor;

                         (vii) to sign and endorse any drafts, assignments,
                    proxies, stock powers, verifications, notices and other
                    documents relating to the Pledged Collateral of such
                    Pledgor;

                                        9

<PAGE>

                    (viii) to settle, compromise or adjust any suit, action or
               proceeding described above and, in connection therewith, to give
               such discharges or releases as the Collateral Agent may deem
               reasonably appropriate;

                    (ix) to execute and deliver all assignments, conveyances,
               statements, financing statements, renewal financing statements,
               pledge agreements, affidavits, notices and other agreements,
               instruments and documents that the Collateral Agent may
               reasonably determine necessary in order to perfect and maintain
               the security interests and liens granted in this Pledge Agreement
               and in order to fully consummate all of the transactions
               contemplated therein;

                    (x) to exchange any of the Pledged Collateral of such
               Pledgor or other property upon any merger, consolidation,
               reorganization, recapitalization or other readjustment of the
               issuer thereof and, in connection therewith, deposit any of the
               Pledged Collateral of such Pledgor with any committee,
               depository, transfer agent, registrar or other designated agency
               upon such terms as the Collateral Agent may reasonably determine;

                    (xi) to vote for a shareholder resolution, or to sign an
               instrument in writing, sanctioning the transfer of any or all of
               the Pledged Collateral of such Pledgor into the name of the
               Collateral Agent into the name of any transferee to whom the
               Pledged Collateral of such Pledgor or any part thereof may be
               sold pursuant to Section 9 hereof; and

                    (xii) to do and perform all such other acts and things as
               the Collateral Agent may reasonably deem to be necessary or
               proper in connection with the Pledged Collateral of such Pledgor.

          This power of attorney is a power coupled with an interest and shall
be irrevocable for so long as any of the Secured Obligations remain outstanding
or any Credit Document is in effect. The Collateral Agent shall be under no duty
to exercise or withhold the exercise of any of the rights, powers, privileges
and options expressly or implicitly granted to the Collateral Agent in this
Pledge Agreement, and shall not be liable for any failure to do so or any delay
in doing so. The Collateral Agent shall not be liable for any act or omission or
for any error of judgment or any mistake of fact or law in its individual
capacity or its capacity as attorney-in-fact except acts or omissions resulting
from its gross negligence or willful misconduct. This power of attorney is
conferred on the Collateral Agent solely to protect, preserve and realize upon
its security interest in Pledged Collateral.

               (b) Performance by the Collateral Agent of Pledgor's Obligations.
          If any Pledgor fails to perform any agreement or obligation contained
          herein, the Collateral Agent itself may perform, or cause performance
          of, such agreement or obligation, and the expenses of the Collateral
          Agent incurred in connection

                                       10

<PAGE>

          therewith shall be payable by the Pledgors on a joint and several
          basis pursuant to Section 26 hereof.

               (c) Assignment by the Collateral Agent and the Lenders. The
          Collateral Agent and each Lender may from time to time assign the
          Secured Obligations and any portion thereof in accordance with the
          Credit Agreement and/or the Pledged Collateral and any portion
          thereof, and the assignee shall be entitled to all of the rights and
          remedies of the Collateral Agent or such Lender, as applicable, under
          this Pledge Agreement in relation thereto.

               (d) The Collateral Agent's Duty of Care. Other than the exercise
          of reasonable care to assure the safe custody of the Pledged
          Collateral while being held by the Collateral Agent hereunder, the
          Collateral Agent shall have no duty or liability to preserve rights
          pertaining thereto, it being understood and agreed that the Pledgors
          shall be responsible for preservation of all rights in the Pledged
          Collateral of such Pledgor, and the Collateral Agent shall be relieved
          of all responsibility for Pledged Collateral upon surrendering it or
          tendering the surrender of it to the Pledgors. The Collateral Agent
          shall be deemed to have exercised reasonable care in the custody and
          preservation of the Pledged Collateral in its possession if such
          Pledged Collateral is accorded treatment substantially equal to that
          which the Collateral Agent accords its own property, which shall be no
          less than the treatment employed by a reasonable and prudent agent in
          the industry, it being understood that the Collateral Agent shall not
          have responsibility for (i) ascertaining or taking action with respect
          to calls, conversions, exchanges, maturities, tenders or other matters
          relating to any Pledged Collateral, whether or not the Collateral
          Agent has or is deemed to have knowledge of such matters; or (ii)
          taking any necessary steps to preserve rights against any parties with
          respect to any Pledged Collateral.

               (e) Voting Rights in Respect of the Pledged Collateral.

                         (i) So long as no Event of Default shall have occurred
                    and be continuing, to the extent permitted by law, each
                    Pledgor may exercise any and all voting and other consensual
                    rights pertaining to the Pledged Collateral of such Pledgor
                    or any part thereof for any purpose not inconsistent with
                    the terms of this Pledge Agreement or the Credit Agreement;
                    and

                         (ii) Upon the occurrence and during the continuance of
                    an Event of Default, all rights of a Pledgor to exercise the
                    voting and other consensual rights which it would otherwise
                    be entitled to exercise pursuant to paragraph (i) of this
                    subsection shall cease and all such rights shall thereupon
                    become vested in the Collateral Agent which shall then have
                    the sole right to exercise such voting and other consensual
                    rights.

               (f) Dividend Rights in Respect of the Pledged Collateral.

                                       11

<PAGE>

                         (i) So long as no Event of Default shall have occurred
                    and be continuing and subject to Section 4(b) hereof, each
                    Pledgor may receive and retain any and all dividends (other
                    than stock dividends and other dividends constituting
                    Pledged Collateral which are addressed hereinabove) or
                    interest paid in respect of the Pledged Collateral to the
                    extent they are allowed under the Credit Agreement.

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

                              (A) all rights of a Pledgor to receive the
                         dividends and interest payments which it would
                         otherwise be authorized to receive and retain pursuant
                         to paragraph (i) of this subsection shall cease and all
                         such rights shall thereupon be vested in the Collateral
                         Agent (or its designee) which shall then have the sole
                         right to receive and hold as Pledged Collateral such
                         dividends and interest payments; and

                              (B) all dividends and interest payments which are
                         received by a Pledgor contrary to the provisions of
                         paragraph (A) of this subsection shall be received in
                         trust for the benefit of the Collateral Agent, shall be
                         segregated from other property or funds of such
                         Pledgor, and shall be forthwith paid over to the
                         Collateral Agent (or its designee) as Pledged
                         Collateral in the exact form received, to be held by
                         the Collateral Agent (or its designee) as Pledged
                         Collateral and as further collateral security for the
                         Secured Obligations.

               (g) Release of Pledged Collateral. The Collateral Agent may
          release any of the Pledged Collateral from this Pledge Agreement or
          may substitute any of the Pledged Collateral for other Pledged
          Collateral without altering, varying or diminishing in any way the
          force, effect, lien, pledge or security interest of this Pledge
          Agreement as to any Pledged Collateral not expressly released or
          substituted, and this Pledge Agreement shall continue as a first
          priority lien (subject in priority solely to the Liens in favor of the
          Working Capital Lender) on all Pledged Collateral not expressly
          released or substituted.

          11. Exception for Unlimited Liability Company Shares. Notwithstanding
anything contained in this Pledge Agreement to the contrary, with respect to the
Pledged Collateral that constitutes the ULC Shares, subsections 10(e) and 10(f)
shall not apply to such ULC Shares, and neither the Collateral Agent nor any
person other than the PRG-Schultz Canada shall become or deemed to become
members or shareholders of the ULC for the purposes of the Companies Act (Nova
Scotia) pursuant to this Pledge Agreement until such time as notice is given to
the PRG-Schultz Canada and further steps are taken under this Pledge Agreement
to register the Collateral Agent or its nominee as holder of the ULC Shares. No
provision in this Pledge Agreement or actions taken by the Collateral Agent
pursuant to this

                                       12
<PAGE>

Pledge Agreement which might provide or be deemed to provide otherwise than as
set forth above or which might provide or be deemed to provide the Collateral
Agent any other ownership or indicia of ownership of the ULC shall apply in
respect of ULC Shares except as set forth in the final sentence of this Section
11. To the extent that any provision of this Pledge Agreement would have the
effect of constituting the Collateral Agent as a member of the ULC prior to the
time of the re-registration of the shares in its name or that of its nominee,
such provision shall be severed herefrom and rendered ineffective with respect
to (but only with respect to) Pledged Collateral comprising the ULC Shares and
without otherwise invalidating or rendering unenforceable this Pledge Agreement
or invalidating or rendering unenforceable such provision insofar as it relates
to Pledged Collateral that is not comprised of the ULC Shares. Without limiting
the generality of the foregoing and notwithstanding anything to the contrary in
this Pledge Agreement with respect to the ULC Shares only, neither PRG-Schultz
Canada nor the ULC, the issuer of the ULC Shares, shall, or shall be obliged to,
cause or permit the Collateral Agent to be, or to be deemed to be or entitled
to, (i) be registered as shareholder or member, or apply to be registered as
shareholder or member of the ULC other than upon the enforcement of rights'
described in the final sentence of this Section 11 upon the giving of notice;
(ii) be referred to in any notation entered in any share register in respect of
ULC Shares; (iii) be held out as shareholder or member of the ULC; or (iv) to
act as shareholder or member of the ULC, or obtain, exercise or attempt to
exercise any rights of a shareholder or member including, without limitation,
the right to attend a meeting of, or to vote the shares of, the ULC or to
receive (other than to hold as Pledged Collateral), any dividend or other
distribution in respect of ULC Shares. The foregoing limitations shall not
restrict the Collateral Agent from exercising the rights, powers and remedies
which it is entitled to exercise under Section 9 of this Pledge Agreement in
respect of any Pledged Collateral constituting the ULC Shares at any time that
the Collateral Agent shall be entitled to realize on all or any portion of the
Pledged Collateral pursuant to the security interests and pledges granted by
this Pledge Agreement, provided that no such exercise shall occur, or be deemed
to have occurred, prior to the provision to PRG-Schultz Canada by the Collateral
Agent of prior written notice of the Collateral Agent's intention to exercise
such rights, powers and remedies.

          12. Application of Proceeds. Upon the occurrence and during the
continuance of an Event of Default, any payments in respect of the Secured
Obligations and any proceeds of any Pledged Collateral, when received by the
Collateral Agent or the Lenders in cash or its equivalent, will be applied in
reduction of the Secured Obligations in the order set forth in Section 9.3 of
the Credit Agreement, and each Pledgor irrevocably waives the right to direct
the application of such payments and proceeds and acknowledges and agrees that
the Collateral Agent and the Lenders shall have the continuing and exclusive
right to apply and reapply any and all such payments and proceeds in the
Collateral Agent's and the Lenders' sole discretion, notwithstanding any entry
to the contrary upon any of its books and records.

          13. Costs of Counsel. At all times hereafter, the Pledgors agree to
promptly pay upon demand any and all reasonable costs and expenses of (a) the
Collateral Agent and each Lender, as required under Section 10.4 of the Credit
Agreement and (b) of the Collateral Agent as the incurrence of such costs and
expenses are reasonably necessary to protect the Pledged Collateral or to
exercise any rights or remedies under this Pledge Agreement or with respect to
any Pledged Collateral. All of the foregoing costs and expenses shall constitute
Secured Obligations hereunder.

                                       13

<PAGE>

          14. Continuing Agreement.

               (a) This Pledge Agreement shall be a continuing agreement in
          every respect and shall remain in full force and effect so long as any
          of the Secured Obligations remain outstanding and the Credit Document
          shall not have been terminated (other than any obligations with
          respect to the indemnities and the representations and warranties set
          forth in the Credit Documents). Upon such payment and termination,
          this Pledge Agreement shall be automatically terminated and the
          Collateral Agent shall, upon the request and at the expense of the
          Pledgors, forthwith promptly release all of its liens and security
          interests hereunder and shall execute and deliver all UCC termination
          statements and/or other documents reasonably requested by the Pledgors
          evidencing such termination. Notwithstanding the foregoing all
          releases and indemnities provided hereunder shall survive termination
          of this Pledge Agreement.

               (b) This Pledge Agreement shall continue to be effective or be
          automatically reinstated, as the case may be, if at any time payment,
          in whole or in part, of any of the Secured Obligations is rescinded or
          must otherwise be restored or returned by the Collateral Agent or any
          Lender as a preference, fraudulent conveyance or otherwise under any
          bankruptcy, insolvency or similar law, all as though such payment had
          not been made; provided that in the event payment of all or any part
          of the Secured Obligations is rescinded or must be restored or
          returned, all reasonable costs and expenses (including without
          limitation any reasonable legal fees and disbursements) incurred by
          the Collateral Agent or any Lender in defending and enforcing such
          reinstatement shall be deemed to be included as a part of the Secured
          Obligations.

          15. Amendments; Waivers: Modifications. This Pledge Agreement and the
provisions hereof may not be amended, waived, modified, changed, discharged or
terminated unless such amendment, change, waiver, discharge or termination is in
writing entered into by, or approved in writing by, the Collateral Agent and
each of the Obligors.

          16. Successors in Interest. This Pledge Agreement shall create a
continuing security interest in the Collateral and shall be binding upon each
Pledgor, its successors and assigns and shall inure, together with the rights
and remedies of the Collateral Agent hereunder, to the Collateral Agent, for the
ratable benefit of the Lenders and each of their respective successors and
permitted assigns; provided, however, that none of the Pledgors may assign its
rights or delegate its duties hereunder without the prior written consent of the
Required Lenders. To the fullest extent permitted by law, each Pledgor hereby
releases the Collateral Agent and each Lender, and their successors and assigns
and their respective officers, attorneys, employees and agents, from any
liability for any act or omission or any error of judgment or mistake of fact or
of law relating to this Pledge Agreement or the Collateral, except as set forth
in Section 10 hereof and except for any liability arising from the gross
negligence or willful misconduct of the Collateral Agent or any Lender,
respectively, or its officers, employees or agents.

                                       14

<PAGE>

          17. Notices. All notices required or permitted to be given under this
Pledge Agreement shall be in conformance with Section 10.1 of the Credit
Agreement.

          18. Counterparts. This Pledge Agreement may be executed in any number
of counterparts, each of which where so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument. It
shall not be necessary in making proof of this Pledge Agreement to produce or
account for more than one such counterpart.

          19. Headings. The headings of the sections and subsections hereof are
provided for convenience only and shall not in any way affect the meaning or
construction of any provision of this Pledge Agreement.

          20. Governing Law; Submission to Jurisdiction; Venue.

               (a) THIS PLEDGE AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
          ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK APPLICABLE TO
          AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE;
          PROVIDED THAT THE COLLATERAL AGENT AND THE LENDERS SHALL RETAIN ALL
          RIGHTS ARISING UNDER FEDERAL LAW.

               (b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS PLEDGE
          AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF
          THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY, NEW YORK OR OF THE
          UNITED STATES FOR THE SOUTHERN DISTRICT OF SUCH STATE, AND BY
          EXECUTION AND DELIVERY OF THIS PLEDGE AGREEMENT, EACH CREDIT PARTY,
          EACH LENDER AND THE COLLATERAL AGENT CONSENTS, FOR ITSELF AND IN
          RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE
          COURTS. EACH CREDIT PARTY, EACH LENDER AND THE COLLATERAL AGENT
          IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE
          LAYING OF VENUE OR BASED ON THE GROUNDS OF FORUM NON CON VENIENS,
          WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION OR
          PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY CREDIT DOCUMENT OR
          OTHER DOCUMENT RELATED THERETO. EACH CREDIT PARTY, EACH LENDER AND THE
          COLLATERAL AGENT WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR
          OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE
          LAW OF SUCH STATE.

          21. Waiver of Jury Trial. EACH PARTY TO THIS PLEDGE AGREEMENT HEREBY
EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION ARISING UNDER THIS PLEDGE AGREEMENT OR ANY OTHER CREDIT DOCUMENT
OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE
PARTIES HERETO OR ANY OF THEM WITH RESPECT TO THIS PLEDGE AGREEMENT OR ANY OTHER
CREDIT DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE

                                       15
<PAGE>

WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR
TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS PLEDGE AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE
CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

          22. Severability. If any provision of this Pledge Agreement is
determined to be illegal, invalid or unenforceable, such provision shall be
fully severable and the remaining provisions shall remain in full force and
effect and shall be construed without giving effect to the illegal, invalid or
unenforceable provisions.

          23. Entirety. This Pledge Agreement, the other Credit Documents and
the other documents relating to the Secured Obligations represent the entire
agreement of the parties hereto and thereto, and supersede all prior agreements
and understandings, oral or written, if any, including any commitment letters or
correspondence relating to the Credit Documents, any other documents relating to
the Secured Obligations or the transactions contemplated herein and therein.

          24. Survival. All representations and warranties of the Pledgors
hereunder shall survive the execution and delivery of this Pledge Agreement, and
the other Credit Documents.

          25. Other Security. To the extent that any of the Secured Obligations
are now or hereafter secured by property other than the Pledged Collateral
(including, without limitation, real and other personal property owned by a
Pledgor), or by a guarantee, endorsement or property of any other Person, then
the Collateral Agent shall, subject in priority solely to the Liens in favor of
the Working Capital Lender, have the right to proceed against such other
property, guarantee or endorsement upon the occurrence of any Event of Default,
and the Collateral Agent has the right, in its sole discretion, to determine
which rights, security, liens, security interests or remedies the Collateral
Agent shall at any time pursue, relinquish, subordinate, modify or take with
respect thereto, without in any way modifying or affecting any of them or any of
the Collateral Agent's rights or the Secured Obligations under this Pledge
Agreement, under any other of the Credit Documents or under any other documents
relating to the Secured Obligations.

          26. Joint and Several Obligations of Pledgors.

               (a) Each of the Pledgors is accepting joint and several liability
          hereunder in consideration of the financial accommodation to be
          provided by the Collateral Agent and the Lenders under the Credit
          Agreement, for the mutual benefit, directly and indirectly, of each of
          the Pledgors and in consideration of the undertakings of each of the
          Pledgors to accept joint and several liability for the obligations of
          each of them.

               (b) Each of the Pledgors jointly and severally hereby irrevocably
          and unconditionally accepts, not merely as a surety but also as a
          co-debtor, joint and several liability with the other Pledgors with
          respect to the payment and

                                       16

<PAGE>

          performance of all of the Secured Obligations arising under this
          Pledge Agreement, and the other Credit Documents, it being the
          intention of the parties hereto that all the Secured Obligations shall
          be the joint and several obligations of each of the Pledgors without
          preferences or distinction among them.

               (c) Notwithstanding any provision to the contrary contained
          herein, in any other of the Credit Documents, the obligations of each
          Guarantor under the Credit Agreement, the other Credit Documents and
          the documents relating to the Secured Obligations shall be limited to
          an aggregate amount equal to the largest amount that would not render
          such obligation subject to avoidance under Section 548 of the United
          States Bankruptcy Code or any comparable provisions of any applicable
          state law.

          27. Intercreditor Agreement. Notwithstanding anything to the contrary
in this Pledge Agreement, (i) the rights of each Pledgor, the Collateral Agent
and the Lenders under this Pledge Agreement are subject to the terms of the
Intercreditor Agreement, (ii) any obligation of any Pledgor in this Pledge
Agreement that requires delivery of Pledged Collateral to, possession or control
of Pledged Collateral with, the pledge, assignment, endorsement or transfer of
Pledged Collateral to or the registration of Pledged Collateral in the name of,
the Collateral Agent shall be deemed complied with and satisfied if such
delivery of Pledged Collateral is made to, such possession or control of Pledged
Collateral is with, or such Pledged Collateral be assigned, endorsed or
transferred to or registered in the name of, the Working Capital Lender, and
(iii) in the event of a direct conflict between the terms and provisions of this
Pledge Agreement and the terms and provisions of the Intercreditor Agreement, it
is the intention of each Pledgor, the Collateral Agent and the Lenders that such
provisions shall be read together and construed, to the fullest extent possible,
to be in concert with each other; however, in the event of any actual,
irreconcilable conflict that cannot be resolved as aforesaid, the terms and
provisions of the Intercreditor Agreement shall control and, in such case, no
Pledgor shall be in breach of its obligations under this Pledge Agreement as a
result of complying with the terms and provisions of the Intercreditor
Agreement; provided that, notwithstanding the foregoing, nothing contained in
this Section 27 shall limit or otherwise adversely effect the grant of a lien on
or a security interest in any Pledged Collateral under Section 2 of this Pledge
Agreement.

                  [remainder of page intentionally left blank]

                                       17

<PAGE>

          Each of the parties hereto has caused a counterpart of this Pledge
Agreement to be duly executed and delivered as of the date first above written.

PLEDGORS:                               PRG-SCHULTZ USA, INC.,
                                        a Georgia corporation

                                        By: s/
                                            ------------------------------------
                                        Name: James E. Moylan, Jr.
                                        Title: Executive Vice President
                                               - Finance, Chief Financial
                                               Officer and Treasurer

                                        PRG SCHULTZ INTERNATIONAL, INC.,
                                        a Georgia corporation

                                        By: s/
                                            ------------------------------------
                                        Name: James E. Moylan, Jr.
                                        Title: Executive Vice President
                                               - Finance, Chief Financial
                                               Officer and Treasurer

                                        PRGFS, INC.,
                                        PRGLS, INC.
                                        Each a Delaware corporation

                                        By: s/
                                            ------------------------------------
                                        Name: James E. Moylan, Jr.
                                        Title: Executive Vice President
                                               - Finance

                                        PRGFS, INC., a Delaware corporation

                                        By: s/
                                            ------------------------------------
                                        Name: James B. McCurry
                                        Title: President

                                        PRG HOLDING CO. (FRANCE) NO. 1, LLC,
                                        PRG HOLDING CO. (FRANCE) NO.2, LLC,
                                        Each a Delaware limited liability
                                        company

                                        By: s/
                                            ------------------------------------
                                        Name: James E. Moylan, Jr.
                                        Title: Executive Vice President
                                               - Finance, Chief Financial
                                               Officer and Treasurer

                                       18

<PAGE>

                                        THE PROFIT RECOVERY GROUP ASIA, INC.,
                                        PRG-SCHULTZ CANADA, INC.,
                                        THE PROFIT RECOVERY GROUP NEW ZEALAND,
                                           INC.,
                                        THE PROFIT RECOVERY GROUP NETHERLANDS,
                                           INC.,
                                        THE PROFIT RECOVERY GROUP MEXICO, INC.
                                        PRG-SCHULTZ FRANCE, INC.,
                                        PRG-SCHULTZ AUSTRALIA, INC.,
                                        PRG-SCHULTZ BELGIUM, INC.,
                                        PRG-SCHULTZ CHILE, INC.,
                                        THE PROFIT RECOVERY GROUP GERMANY, INC.,
                                        PRG INTERNATIONAL, INC.,
                                        PRG-SCHULTZ SWITZERLAND, INC.,
                                        THE PROFIT RECOVERY GROUP SOUTH AFRICA,
                                           INC.,
                                        THE PROFIT RECOVERY GROUP SPAIN, INC.,
                                        THE PROFIT RECOVERY GROUP ITALY, INC.,
                                        PRG-SCHULTZ SCANDINAVIA, INC.,
                                        PRG-SCHULTZ PORTUGAL, INC.,
                                        PRG-SCHULTZ JAPAN, INC.,
                                        THE PROFIT RECOVERY GROUP COSTA RICA,
                                           INC.,
                                        PRG-SCHULTZ PUERTO RICO, INC.,
                                        PRG USA, INC.,
                                        PRG-SCHULTZ EUROPE, INC.,
                                        EACH A GEORGIA CORPORATION

                                        By: s/
                                            ------------------------------------
                                        Name: James E. Moylan, Jr.
                                        Title: Executive Vice President
                                               - Finance, Chief Financial
                                               Officer and Treasurer

                                        HS&A ACQUISITION - UK, INC.,
                                        a Texas corporation

                                        By: s/
                                            ------------------------------------
                                        Name: James E. Moylan, Jr.
                                        Title: Executive Vice President
                                               - Finance, Chief Financial
                                               Officer and Treasurer

                                       19

<PAGE>

COLLATERAL AGENT:                       BLUM STRATEGIC PARTNERS II, L.P.

                                        By: s/
                                            ------------------------------------
                                        Name: Jose Medeiros
                                        Title: Partner

                                       20

<PAGE>

                                  Schedule 2(a)

                                       to

                                Pledge Agreement

                          dated as of December __, 2005

                           in favor of [____________]

                               as Collateral Agent

                                  PLEDGED STOCK

PLEDGOR: [EACH PLEDGOR]

<TABLE>
<CAPTION>
                     Number of   Certificate   Percentage
Name of Subsidiary     Shares       Number      Ownership
------------------   ---------   -----------   ----------
<S>                  <C>         <C>           <C>

</TABLE>

[EACH SUBSIDIARY OF
SUCH PLEDGOR]

<PAGE>

                                  Exhibit 4(b)

                                       to

                                Pledge Agreement

                          dated as of December __, 2005

                           in favor of [____________]

                               as Collateral Agent

                             IRREVOCABLE STOCK POWER

          FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers to __________________________________ the following shares of capital
stock of ________________________ - ______________ corporation:

<TABLE>
<CAPTION>
No. of Shares   Certificate No.
-------------   ---------------
<S>             <C>

</TABLE>

and irrevocably appoints ____________________________________ its agent and
attorney-in-fact to transfer all or any part of such capital stock and to take
all necessary and appropriate action to effect any such transfer. The agent and
attorney-in-fact may substitute and appoint one or more persons to act for him.

                                        a _______________________ corporation

                                        _________________________,

                                        a ________________________ corporation

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

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