Document:

Exhibit 4.4

 

EXECUTION COPY

 

SECURITY AGREEMENT

 

dated as of

 

February 2, 2006,

 

among

 

INDALEX HOLDINGS FINANCE,
INC.,

 

INDALEX HOLDING CORP.,

 

THE SUBSIDIARY PARTIES
IDENTIFIED HEREIN

 

and

 

U.S. BANK NATIONAL
ASSOCIATION,

as Collateral Agent

 

THIS SECURITY AGREEMENT IS SUBJECT TO THE
PROVISIONS OF THE INTERCREDITOR AGREEMENT OF EVEN DATE HEREWITH AMONG INDALEX
HOLDINGS FINANCE, INC., INDALEX HOLDING CORP., CERTAIN OF ITS SUBSIDIARIES,
JPMORGAN CHASE BANK, N.A., AS INTERCREDITOR AGENT, AND U.S. BANK NATIONAL
ASSOCIATION, AS TRUSTEE, AS SET FORTH MORE FULLY IN SECTION 6.16 HEREOF.

 

[CS&M No.
6749-649]

 

TABLE OF CONTENTS

ARTICLE I

Definitions

	
  SECTION 1.01. Indenture

  	
   

  	
  1

  
	
  SECTION 1.02. Other Defined Terms

  	
   

  	
  1

  

ARTICLE II

Pledge of Securities

	
  SECTION 2.01. Pledge

  	
   

  	
  5

  
	
  SECTION 2.02. Delivery of the Pledged Collateral

  	
   

  	
  6

  
	
  SECTION 2.03. Representations, Warranties and
  Covenants

  	
   

  	
  7

  
	
  SECTION 2.04. Certification of Limited Liability
  Company and Limited Partnership Interests

  	
   

  	
  8

  
	
  SECTION 2.05. Registration in Nominee Name;
  Denominations

  	
   

  	
  8

  
	
  SECTION 2.06. Voting Rights; Dividends and Interest

  	
   

  	
  9

  

 

ARTICLE III

Security Interests in Personal Property

	
  SECTION 3.01. Security Interest

  	
   

  	
  11

  
	
  SECTION 3.02. Representations and Warranties

  	
   

  	
  13

  
	
  SECTION 3.03. Covenants

  	
   

  	
  14

  
	
  SECTION 3.04. Other Actions

  	
   

  	
  18

  
	
  SECTION 3.05. Covenants Regarding Patent, Trademark
  and Copyright Collateral

  	
   

  	
  21

  

 

ARTICLE IV

Remedies

	
  SECTION 4.01. Remedies Upon Default

  	
   

  	
  23

  
	
  SECTION 4.02. Application of Proceeds

  	
   

  	
  25

  
	
  SECTION 4.03. Grant of License to Use Intellectual
  Property

  	
   

  	
  25

  
	
  SECTION 4.04. Securities Act

  	
   

  	
  25

  
	
  SECTION 4.05. Registration

  	
   

  	
  26

  

 

ARTICLE V

Indemnity, Subrogation and Subordination

	
  SECTION 5.01. Indemnity and Subrogation

  	
   

  	
  27

  

 

 

 

	
  SECTION 5.02. Contribution and Subrogation

  	
   

  	
  27

  
	
  SECTION 5.03. Subordination

  	
   

  	
  27

  

 

ARTICLE VI

Miscellaneous

	
  SECTION 6.01. Notices

  	
   

  	
  28

  
	
  SECTION 6.02. Waivers; Amendment

  	
   

  	
  28

  
	
  SECTION 6.03. Collateral Agent’s Fees and Expenses;
  Indemnification

  	
   

  	
  28

  
	
  SECTION 6.04. Successors and Assigns

  	
   

  	
  29

  
	
  SECTION 6.05. Survival of Agreement

  	
   

  	
  29

  
	
  SECTION 6.06. Counterparts; Effectiveness; Several
  Agreement

  	
   

  	
  29

  
	
  SECTION 6.07. Severability

  	
   

  	
  30

  
	
  SECTION 6.08. [RESERVED]

  	
   

  	
  30

  
	
  SECTION 6.09. Governing Law; Jurisdiction; Consent to
  Service of Process

  	
   

  	
  31

  
	
  SECTION 6.10. WAIVER OF JURY TRIAL

  	
   

  	
  31

  
	
  SECTION 6.11. Headings

  	
   

  	
  32

  
	
  SECTION 6.12. Security Interest Absolute

  	
   

  	
  32

  
	
  SECTION 6.13. Termination or Release

  	
   

  	
  32

  
	
  SECTION 6.14. Additional Subsidiaries

  	
   

  	
  32

  
	
  SECTION 6.15. Collateral Agent Appointed
  Attorney-in-Fact

  	
   

  	
  32

  
	
  SECTION 6.16. Intercreditor Agreement Governs

  	
   

  	
  33

  

 

 

Schedules

	
  Schedule I

  	
   

  	
  Subsidiary Parties

  
	
  Schedule II

  	
   

  	
  Pledged Stock; Debt Securities

  
	
  Schedule III

  	
   

  	
  Intellectual Property

  
	
  Schedule IV

  	
   

  	
  Commercial Tort Claims

  

 

Exhibits

	
  Exhibit A

  	
   

  	
  Form of Supplement

  
	
  Exhibit B

  	
   

  	
  Perfection Certificate

  

 

 

SECURITY AGREEMENT (this “Agreement”)
dated as of February 2, 2006, among INDALEX HOLDINGS FINANCE, INC., a Delaware
corporation (“Parent”), INDALEX HOLDING CORP., a Delaware corporation
and a wholly-owned subsidiary of Parent (the “Company”), the Subsidiary
Parties identified herein and U.S. BANK NATIONAL ASSOCIATION, a national
banking association, as collateral agent (the “Collateral Agent”).

Reference is made to the Indenture dated as of
February 2, 2006, among Parent, the Company, the Subsidiary Guarantors
identified therein and U.S. Bank National Association, as Trustee (as it may be
amended, restated, supplemented or otherwise modified from time to time, the “Indenture”),
pursuant to which the Company issued the Securities (such term, and each other
capitalized term used and not heretofore defined herein, having the meaning
assigned thereto in Article I below). 
The Trustee has agreed to enter into the Indenture, and the Initial
Purchasers and Holders have agreed to purchase the Securities, on the terms and
subject to the conditions set forth in the Indenture and the Purchase Agreement
dated as of January 30, 2006, among Parent, the Company and the Initial
Purchasers.  The obligations of the
Initial Purchasers to purchase the Securities are conditioned upon, among other
things, the execution and delivery of this Agreement by the Grantors.

Accordingly, in consideration of the foregoing and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

Definitions

SECTION 1.01.  Indenture. 
(a)  Capitalized terms used in
this Agreement and not otherwise defined herein have the meanings specified in
the Indenture.  All terms defined in the
New York UCC (as defined herein) and not defined in this Agreement have the
meanings specified therein; the term “instrument” shall have the meaning
specified in Article 9 of the New York UCC.

(b)  The rules of construction
specified in Section 1.04 of the Indenture also apply to this Agreement.

SECTION 1.02.  Other Defined Terms.  As used in this Agreement, the following
terms have the meanings specified below:

“Account Debtor”
means any Person who is or who may become obligated to any Grantor under, with
respect to or on account of an Account.

“Article 9
Collateral” has the meaning assigned to such term in
Section 3.01.

 

“Collateral”
means Article 9 Collateral and Pledged Collateral.

“Collateral Access
Agreement” means any landlord waiver or other agreement between the
Collateral Agent (or, prior to the Discharge of Senior Lender Claims, the
Intercreditor Agent, acting as a sub-agent of the Collateral Agent) and any
third party (including any bailee, consignee, customs broker or other similar
Person) in possession of any Collateral or any landlord of any Grantor for any
real property where any Collateral is located, as such landlord waiver or other
agreement may be amended, restated or otherwise modified from time to time.

“Copyright License”
means any written agreement, now or hereafter in effect, granting any right to
any third party under any copyright now or hereafter owned by any Grantor or
that such Grantor otherwise has the right to license, or granting any right to
any Grantor under any copyright now or hereafter owned by any third party, and
all rights of such Grantor under any such agreement.

“Copyrights”
means all of the following now owned or hereafter acquired by any Grantor:  (a) all copyright rights in any work
subject to the copyright laws of the United States or any other country,
whether as author, assignee, transferee or otherwise, and (b) all
registrations and applications for registration of any such copyright in the
United States or any other country, including registrations, recordings,
supplemental registrations and pending applications for registration in the
United States Copyright Office, including those listed on Schedule III.

“Discharge of Senior Lender Claims” has the
meaning assigned to such term in the Intercreditor Agreement.

“Equity Interests” means shares of capital
stock, partnership interests, membership interests in a limited liability
company, beneficial interests in a trust or other equity ownership interests in
a Person, and any warrants, options or other rights entitling the holder
thereof to purchase or acquire any such equity interest.

“Exclusive Liens” means, collectively, (a)
Liens of the type described in paragraphs (c), (d), (e), (g), (k), (o) and (t)
of Section 6.02 of the Credit Agreement, as in effect on the date hereof,
and (b) Liens on cash and cash equivalents of the type described in paragraphs
(c), (d) and (g) of the definition of the term “Permitted Encumbrances” set
forth in the Credit Agreement, as in effect on the date hereof, provided
that such Liens apply exclusively to such cash and cash equivalents; provided,
further, in each case under clauses (a) and (b) above, that such
Liens are permitted to exist by the Indenture and the Credit Agreement.

“Federal Securities Laws”
has the meaning assigned to such term in Section 4.04.

“General Intangibles”
means all choses in action and causes of action and all other intangible
personal property of every kind and nature (other than Accounts), and all other
“general intangibles”, as defined in the New York UCC (other than Accounts),
now owned or hereafter acquired by any Grantor, including corporate or other
business

 2
 

 

records, indemnification
claims, contract rights (including rights under leases, whether entered into as
lessor or lessee, Interest Rate Agreements, Currency Agreements, Commodity Agreements
and other agreements), Intellectual Property, goodwill, registrations,
franchises, tax refund claims and any letter of credit, guarantee, claim,
security interest or other security held by or granted to any Grantor to secure
payment by an Account Debtor of any of the Accounts.

“Grantors”
means Parent, the Company and the Subsidiary Parties.

“Intellectual Property”
means all intellectual and similar property of every kind and nature now owned
or hereafter acquired by any Grantor, including inventions, designs, Patents,
Copyrights, Licenses, Trademarks, trade secrets, confidential or proprietary
technical and business information, know-how, show-how or other
data or information, software and databases and all embodiments or fixations
thereof and related documentation, registrations and franchises, and all
additions, improvements and accessions to, and books and records describing or
used in connection with, any of the foregoing.

“License”
means any Patent License, Trademark License, Copyright License or other license
or sublicense agreement to which any Grantor is a party, including those listed
on Schedule III.

“New York UCC”
means the Uniform Commercial Code as from time to time in effect in the State
of New York.

“Noteholder Documents” means (a) the Indenture,
the Securities and the Security Documents and (b) the Intercreditor Agreement
and each other document or instrument executed and delivered pursuant to any
Indenture Document described in clause (a) above, evidencing or governing any
Obligations thereunder, in each case, as such agreements may be amended,
restated, supplemented or otherwise modified from time to time.

“Patent License”
means any written agreement, now or hereafter in effect, granting to any third
party any right to make, use or sell any invention on which a Patent, now or
hereafter owned by any Grantor or that any Grantor otherwise has the right to
license, is in existence, or granting to any Grantor any right to make, use or
sell any invention on which a Patent, now or hereafter owned by any third
party, is in existence, and all rights of any Grantor under any such agreement.

“Patents”
means all of the following now owned or hereafter acquired by any Grantor:  (a) all letters patent of the United
States or the equivalent thereof in any other country, all registrations and
recordings thereof, and all applications for letters patent of the United
States or the equivalent thereof in any other country, including registrations,
recordings and pending applications in the United States Patent and Trademark
Office or any similar offices in any other country, including those listed on
Schedule III, and (b) all reissues, continuations, divisions,
continuations-in-part, renewals

 3
 

 

or extensions thereof,
and the inventions disclosed or claimed therein, including the right to make,
use and/or sell the inventions disclosed or claimed therein.

“Perfection Certificate” means a certificate in
the form of Exhibit B, completed and supplemented with the schedules and
attachments contemplated thereby.

“Pledged Collateral”
has the meaning assigned to such term in Section 2.01.

“Pledged Debt Securities”
has the meaning assigned to such term in Section 2.01.

“Pledged Securities”
means any promissory notes, stock certificates or other securities now or
hereafter included in the Pledged Collateral, including all certificates,
instruments or other documents representing or evidencing any Pledged
Collateral.

“Pledged Stock”
has the meaning assigned to such term in Section 2.01.

“Receivables” means the Accounts, Documents,
Investment Property and any other rights or claims to receive money that are
General Intangibles.

“Secured Obligations” means (a) the full and
punctual payment of the principal of and interest on (including additional
interest, if any) on the Securities when due, whether on an interest payment
date, at maturity, by acceleration, redemption or otherwise, and interest on
the overdue principal of and interest (including additional interest, if any)
on the Securities and (b) payment and performance of all other Obligations
of Parent, the Company or any Subsidiary of the Company to the Holders, the
Trustee and the Collateral Agent under the Noteholder Documents according to
the terms thereof.

“Secured Parties” means, collectively, (a) the
Holders, (b) the Trustee, (c) the Collateral Agent, (d) each other Person that
holds, or is an obligee in respect of, any Secured Obligations and (e) the
successors and assigns of each of the foregoing.

“Security Interest”
has the meaning assigned to such term in Section 3.01.

“Short Form Security
Agreement” has the meaning assigned to such term in
Section 3.02(b).

“Subsidiary Parties”
means (a) the Subsidiaries of the Company identified on Schedule I and (b)
each other Subsidiary of the Company that becomes a party to this Agreement as
a Subsidiary Party after the Issue Date.

“Trademark License”
means any written agreement, now or hereafter in effect, granting to any third
party any right to use any Trademark now or hereafter owned by any Grantor or
that any Grantor otherwise has the right to license, or granting to any

 4
 

 

Grantor any right to use
any Trademark now or hereafter owned by any third party, and all rights of any
Grantor under any such agreement.

“Trademarks”
means all of the following now owned or hereafter acquired by any Grantor:  (a) all trademarks, service marks, trade
names, corporate names, company names, business names, fictitious business
names, trade styles, trade dress, logos, other source or business identifiers,
designs and general intangibles of like nature, now existing or hereafter
adopted or acquired, all registrations and recordings thereof, and all
registration and recording applications filed in connection therewith,
including registrations and registration applications in the United States
Patent and Trademark Office or any similar offices in any State of the United
States or any other country or any political subdivision thereof, and all
extensions or renewals thereof, including those listed on Schedule III,
(b) all goodwill associated therewith or symbolized thereby and (c) all other
assets, rights and interests that uniquely reflect or embody such goodwill.

ARTICLE II

Pledge
of Securities

SECTION 2.01.  Pledge. 
As security for the payment or performance, as the case may be, in full
of the Secured Obligations, each Grantor hereby assigns and pledges to the
Collateral Agent, its successors and assigns, for the benefit of the Secured
Parties, and hereby grants to the Collateral Agent, its successors and assigns,
for the benefit of the Secured Parties, a security interest in all of such
Grantor’s right, title and interest in, to and under (a) (i) the
Equity Interests owned by it as of the Issue Date, including the Equity
Interests listed opposite the name of such Grantor on Schedule II,
(ii) any Equity Interests obtained in the future by such Grantor and
(iii) the certificates representing all such Equity Interests (the “Pledged
Stock”), provided that the Pledged Stock shall not include more than
65% (or such greater percentage that, due to a change in applicable law after
the date hereof, (A) could not reasonably be expected to cause the
undistributed earnings of such Foreign Subsidiary as determined for U.S.
Federal income tax purposes to be treated as a deemed dividend to such Foreign
Subsidiary’s U.S. parent and (B) could not reasonably be expected to cause any
material adverse tax consequences) of the issued and outstanding Equity
Interests entitled to vote (within the meaning of Treas. Reg. Section
1.956-2(c)(2) or any successor regulation) of any Foreign Subsidiary (the
provision set forth in this proviso being referred to as the “Deemed
Dividend Provision”), (b)(i) the debt securities owned by it as of the
Issue Date, including the debt securities listed opposite the name of such
Grantor on Schedule II, (ii) any debt securities in the future issued to
such Grantor and (iii) the promissory notes and any other instruments
evidencing such debt securities (the “Pledged Debt Securities”),
(c) all other property that may be delivered to and held by the Collateral
Agent (or the Intercreditor Agent) pursuant to the terms of this Section 2.01,
(d) subject to Section 2.06, all payments of principal or interest,
dividends, cash, instruments and other property from time to time received,
receivable or otherwise distributed in respect of, in exchange for or upon the
conversion of, and all other Proceeds received in respect of, the securities
referred to in clauses (a) and (b) above, (e) subject to Section
2.06, all rights and privileges of such Grantor with respect to the securities
and other property referred to in

 5
 

 

clauses (a),
(b), (c) and (d) above, and (f) all Proceeds of any of the foregoing (the
items referred to in clauses (a) through (f) above being collectively referred
to as the “Pledged Collateral”); provided, however, that
the Equity Interests and other securities issued by the Company or any
Subsidiary of Parent or the Company will constitute Collateral securing the
Securities and Note Guaranties only to the extent that such Equity Interests
and securities can secure such Securities and Note Guaranties without
Rule 3-16 of Regulation S-X (“Rule 3-16”)
under the Securities Act (or any other law, rule or regulation) requiring
separate financial statements of the Company or such Subsidiary to be filed
with the SEC (or any other governmental agency); provided, further
that, in the event that Rule 3-16 requires or is amended, modified
or interpreted by the SEC to require (or is replaced with another rule or
regulation, or any other law, rule or regulation is adopted, which would
require) the filing with the SEC (or any other governmental agency) of separate
financial statements of the Company or any Subsidiary of Parent or the Company
due to the fact that the Company’s or such Subsidiary’s Equity Interests or other
securities secure the Securities and Note Guaranties, then such Equity
Interests and other securities shall automatically be deemed not to be part of
the Collateral securing the Securities and Note Guaranties (but only to the
extent necessary to not be subject to such requirement); provided, further
that, in the event that Rule 3-16 is amended, modified or
interpreted by the SEC to permit (or is replaced with another rule or
regulation, or any other law, rule or regulation is adopted, which would permit)
the Company’s or such Subsidiary’s Equity Interests and other securities to
secure the Securities and Note Guaranties in excess of the amount then pledged
without the filing with the SEC (or any other governmental agency) of separate
financial statements of the Company or such Subsidiary, then the Equity
Interests and other securities of the Company or such Subsidiary shall
automatically be deemed to be a part of the Collateral securing the Securities
and Note Guaranties (but only to the extent the Company or such Subsidiary
would not be subject to any such financial statement requirement) (the
provisions set forth in this proviso and the two immediately proceeding
provisos being collectively referred to as “Rule 3-16 Provisions”).

TO HAVE AND TO HOLD the Pledged Collateral, together
with all right, title, interest, powers, privileges and preferences pertaining
or incidental thereto, unto the Collateral Agent, its successors and assigns,
for the benefit of the Secured Parties, forever; subject, however,
to the terms, covenants and conditions hereinafter set forth.

SECTION 2.02.  Delivery of the Pledged Collateral.  (a) 
Each Grantor agrees promptly to deliver or cause to be delivered to the
Collateral Agent (or, prior to the Discharge of Senior Lender Claims, to the
Intercreditor Agent) any and all Pledged Securities.

(b)  Each Grantor will cause any
Indebtedness for borrowed money (i) in the case of Indebtedness owed to
such Grantor by any Person other than another Grantor, in principal amount in
excess of $100,000, and (ii) in the case of Indebtedness owed to such
Grantor by another Grantor, in any principal amount, to be evidenced by a duly
executed promissory note that is pledged and delivered to the Collateral Agent
(or, prior to the Discharge of Senior Lender Claims, to the Intercreditor
Agent) pursuant to the terms hereof.

 6
 

 

(c)  Upon the delivery thereof to
the Collateral Agent (or, prior to the Discharge of Senior Lender Claims, to
the Intercreditor Agent) by any Grantor, (i) all Pledged Securities shall
be accompanied by stock powers duly executed in blank or other instruments of
transfer satisfactory to the Collateral Agent (or, prior to the Discharge of
Senior Lender Claims, the Intercreditor Agent) and by such other instruments
and documents as the Intercreditor Agent (if prior the Discharge of Senior
Lender Claims) or the Collateral Agent (if after the Discharge of Senior Lender
Claims) may reasonably request and (ii) all other property comprising part
of the Pledged Collateral shall be accompanied by proper instruments of
assignment duly executed by the applicable Grantor and such other instruments
or documents as the Intercreditor Agent (if prior to the Discharge of Senior
Lender Claims) or the Collateral Agent (if after the Discharge of Senior Lender
Claims) may reasonably request.  Each
delivery of Pledged Securities shall be accompanied by a schedule describing
such securities, which schedule shall be attached hereto as a supplement to
Schedule II and made a part hereof, provided that failure to attach any such schedule hereto
shall not affect the validity of such pledge of such Pledged Securities.

SECTION 2.03.  Representations, Warranties and Covenants.  The Grantors jointly and severally represent,
warrant and covenant to and with the Collateral Agent, for the benefit of the
Secured Parties, that:

(a)
Schedule II correctly sets forth the percentage of the issued and
outstanding units of each class of the Equity Interests of the issuer thereof
represented by the Pledged Stock issued by the Company or any other Subsidiary
of Parent and includes all Equity Interests, debt securities and promissory
notes required to be pledged hereunder;

(b) in the
case of Pledged Stock and Pledged Debt Securities issued by the Company or any
other Subsidiary of Parent, such Pledged Stock and Pledged Debt Securities have
been duly and validly authorized and issued by the issuers thereof and (i) in
the case of Pledged Stock, are fully paid and nonassessable and (ii) in the
case of Pledged Debt Securities, are legal, valid and binding obligations of
the issuers thereof, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights generally
and subject to general principles of equity, regardless of whether considered in
a proceeding in equity or at law;

(c) except for
the security interests granted hereunder, each of the Grantors (i) is and,
subject to any transfers made in compliance with the Indenture, will continue
to be the direct owner, beneficially and of record, of the Pledged Securities
indicated on Schedule II as owned by such Grantor, (ii) holds the same
free and clear of all Liens, other than (A) Permitted Collateral Liens and
(B) transfers made in compliance with the Indenture, (iii) will make
no assignment, pledge, hypothecation or transfer of, or create or permit to
exist any security interest in or other Lien on, the Pledged Collateral, other
than (A) Permitted Collateral Liens and (B) transfers made in
compliance with the Indenture, and (iv) will defend its title or interest
thereto or therein against any

 7
 

 

and all Liens (other than Permitted
Collateral Liens), however arising, of all Persons whomsoever;

(d) in the
case of Pledged Stock and Pledged Debt Securities issued by the Company or any
other Subsidiary of Parent, except for restrictions and limitations imposed by
the Noteholder Documents, the Credit Agreement or securities laws generally,
such Pledged Collateral is and will continue to be freely transferable and
assignable, and none of such Pledged Collateral is or will be subject to any
option, right of first refusal, shareholders agreement, charter or by-law
provisions or contractual restriction of any nature that might prohibit,
impair, delay or otherwise affect the pledge of such Pledged Collateral
hereunder, the sale or disposition thereof pursuant hereto or the exercise by
the Collateral Agent of rights and remedies hereunder;

(e) each of
the Grantors has the power and authority to pledge the Pledged Collateral
pledged by it hereunder in the manner hereby done or contemplated;

(f) no consent
or approval of any Governmental Authority, any securities exchange or any other
Person was or is necessary to ensure the validity of the pledge of any Pledged
Collateral issued by the Company or any other Subsidiary of Parent effected
hereby (other than such as have been obtained and are in full force and
effect); and

(g) by virtue
of the execution and delivery by the Grantors of this Agreement, when any
Pledged Securities are delivered to the Collateral Agent (or its sub-agent or
bailee) in accordance with this Agreement, the Collateral Agent will obtain a
legal, valid and perfected Lien upon and security interest in such Pledged
Securities as security for the payment and performance of the Secured
Obligations, prior to any other Lien on any Pledged Securities other than Liens
securing the First-Priority Lien Obligations or Pari Passu Lien Obligations and
Permitted Collateral Liens that have priority as a matter of law.

SECTION 2.04.  Certification of Limited Liability Company and
Limited Partnership Interests. 
Each interest in any limited liability company or limited partnership,
in each case controlled by any Grantor and pledged hereunder, shall be
represented by a certificate (except, at any time prior to the Discharge of
Senior Lender Claims, to the extent the Intercreditor Agent shall have agreed
otherwise), shall be a “security” within the meaning of Article 8 of the
New York UCC and shall be governed by Article 8 of the New York UCC.

SECTION 2.05.  Registration in Nominee Name; Denominations.  The Collateral Agent, on behalf of the
Secured Parties, shall have the right (in its sole and absolute discretion), at
any time after the Discharge of Senior Lender Claims, to hold the Pledged
Securities in its own name as pledgee, the name of its nominee (as pledgee or
as sub-agent) or the name of the applicable Grantor, endorsed or assigned in
blank or in favor of the Collateral Agent. 
After the Discharge of Senior Lender Claims, each Grantor will promptly
give to the Collateral Agent copies of any material notices or other

 8
 

 

communications
received by it with respect to Pledged Securities registered in the name of
such Grantor.  The Collateral Agent
shall, at all times after the Discharge of Senior Lender Claims and upon the
occurrence and during the continuation of an Event of Default, have the right
to exchange the certificates representing Pledged Securities for certificates
of smaller or larger denominations for any purpose consistent with this
Agreement.

SECTION 2.06.  Voting Rights; Dividends and Interest.  (a) 
Unless and until an Event of Default shall have occurred and be
continuing and the Collateral Agent shall have notified the Grantors that their
rights under this Section 2.06 are being suspended:

(i) Each Grantor
shall be entitled to exercise any and all voting and/or other consensual rights
and powers inuring to an owner of Pledged Securities or any part thereof for
any purpose not inconsistent with the terms of this Agreement, the Indenture
and the other Noteholder Documents, provided
that such rights and powers shall not be exercised in any manner that could
materially and adversely affect the rights inuring to a holder of any Pledged
Securities or the rights and remedies of any of the Collateral Agent or the
other Secured Parties under this Agreement, the Indenture or any other
Noteholder Document or the ability of the Secured Parties to exercise the same.

(ii) The
Collateral Agent shall execute and deliver to each Grantor, or cause to be
executed and delivered to such Grantor, all such proxies, powers of attorney
and other instruments as such Grantor may reasonably request for the purpose of
enabling such Grantor to exercise the voting and/or consensual rights and
powers it is entitled to exercise pursuant to paragraph (i) above (including
for the purpose of reinstating any such rights and powers after the cure or
waiver of any Event of Default).

(iii) Each
Grantor shall be entitled to receive and retain any and all dividends,
interest, principal and other distributions paid on or distributed in respect
of the Pledged Securities to the extent and only to the extent that such
dividends, interest, principal and other distributions are permitted by, and
otherwise paid or distributed in accordance with, the terms and conditions of
the Indenture, the other Noteholder Documents and applicable laws, provided that any noncash
dividends, interest, principal or other distributions that would constitute
Pledged Stock or Pledged Debt Securities, whether resulting from a subdivision,
combination or reclassification of the outstanding Equity Interests of the
issuer of any Pledged Securities or received in exchange for Pledged Securities
or any part thereof, or in redemption thereof, or as a result of any merger,
consolidation, acquisition or other exchange of assets to which such issuer may
be a party or otherwise, shall be and become part of the Pledged Collateral
(subject to the Rule 3-16 Provisions), and, if received by any Grantor and
constituting Pledged Collateral, shall not be commingled by such Grantor with
any of its other funds or property but shall be held separate and apart
therefrom, shall be held in trust for the benefit of the Collateral Agent and
shall be

 9
 

 

forthwith delivered to the Collateral Agent
(or, prior to the Discharge of Senior Lender Claims, the Intercreditor Agent)
in the same form as so received (with any necessary endorsement).

(b)  Upon the occurrence and
during the continuance of an Event of Default, after the Collateral Agent shall
have notified the Grantors of the suspension of their rights under paragraph
(a)(iii) of this Section 2.06, all rights of any Grantor to dividends,
interest, principal or other distributions that such Grantor is authorized to
receive pursuant to paragraph (a)(iii) of this Section 2.06 shall
cease, and all such rights shall thereupon become vested in the Intercreditor
Agent (if prior to the Discharge of Senior Lender Claims) or the Collateral
Agent (if after the Discharge of Senior Lender Claims), which shall have the sole
and exclusive right and authority to receive and retain such dividends,
interest, principal or other distributions. 
All dividends, interest, principal or other distributions received by
any Grantor contrary to the provisions of this Section 2.06 shall be held
in trust for the benefit of the Collateral Agent, shall be segregated from
other property or funds of such Grantor and shall be forthwith delivered to the
Collateral Agent (or, prior to the Discharge of Senior Lender Claims, the
Intercreditor Agent) upon demand in the same form as so received (with any
necessary endorsement).  Any and all
money and other property paid over to or received by the Collateral Agent
pursuant to the provisions of this paragraph (b) shall be retained by the
Collateral Agent in an account to be established by the Collateral Agent upon
receipt of such money or other property and shall be applied in accordance with
the provisions of Section 4.02.  After
all Events of Default have been cured or waived and the Company has delivered
to the Collateral Agent a certificate to that effect, the Collateral Agent
shall promptly repay to each Grantor (without interest) all dividends,
interest, principal or other distributions that such Grantor would otherwise be
permitted to retain pursuant to the terms of paragraph (a)(iii) of this Section
2.06 and that remain in such account.

(c)  Upon the occurrence and
during the continuance of an Event of Default, but after the Collateral Agent
shall have notified the Grantors of the suspension of their rights under
paragraph (a)(i) of this Section 2.06, all rights of any Grantor to
exercise the voting and consensual rights and powers it is entitled to exercise
pursuant to paragraph (a)(i) of this Section 2.06 and the obligations
of the Collateral Agent under paragraph (a)(ii) of this Section 2.06
shall cease, and all such rights shall thereupon become, subject to the rights
of the Intercreditor Agent under the Intercreditor Agreement, vested in the
Collateral Agent, which shall have the sole and exclusive right and authority
to exercise such voting and consensual rights and powers, provided that, unless the
Collateral Agent shall have received written objections from Holders of at
least 25% in principal amount of the Securities, the Collateral Agent shall
have the right from time to time following and during the continuance of an
Event of Default to permit the Grantors to exercise such rights.

(d)  Any notice given by the
Collateral Agent to the Grantors suspending their rights under
paragraph (a) of this Section 2.06 (i) may be given by telephone if
promptly confirmed in writing, (ii) may be given to one or more of the Grantors
at the same or different times and (iii) may suspend the rights of the Grantors
under paragraph (a)(i) or paragraph (a)(iii) in part without suspending all
such rights (as specified by the

 10
 

 

Collateral
Agent in its sole and absolute discretion) and without waiving or otherwise
affecting the Collateral Agent’s rights to give additional notices from time to
time suspending other rights so long as an Event of Default has occurred and is
continuing.

ARTICLE III

Security
Interests in Personal Property

SECTION 3.01.  Security Interest.  (a)  As
security for the payment or performance, as the case may be, in full of the
Secured Obligations, each Grantor hereby assigns and pledges to the Collateral
Agent, its successors and permitted assigns, for the benefit of the Secured
Parties, and hereby grants to the Collateral Agent, its successors and assigns,
for the benefit of the Secured Parties, a security interest (the “Security
Interest”) in, all right, title or interest in or to any and all of the
following assets and properties now owned or at any time hereafter acquired by
such Grantor or in which such Grantor now has or at any time in the future may
acquire any right, title or interest (collectively, the “Article 9 Collateral”):

(i) all
Accounts;

(ii) all
Chattel Paper;

(iii) all cash
and Deposit Accounts;

(iv) all
Documents;

(v) all
Equipment;

(vi) all
General Intangibles;

(vii) all
Instruments;

(viii) all
Inventory;

(ix) all
Investment Property;

(x) all
Letter-of-Credit Rights;

(xi) all
Commercial Tort Claims specified on Schedule IV hereto;

(xii) all
books and records pertaining to the Article 9 Collateral; and

(xiii) to the
extent not otherwise included, all Proceeds and products of any and all of the
foregoing and all collateral security and guarantees given by any Person with
respect to any of the foregoing.

(b)  Each Grantor hereby
irrevocably authorizes the Collateral Agent at any time and from time to time
to file in any relevant jurisdiction any initial financing statements
(including fixture filings) with respect to the Article 9 Collateral or
any part

 11
 

 

thereof and
amendments thereto and continuations thereof that (i) indicate the Collateral
as all assets of such Grantor or words of similar effect as being of an equal
or lesser scope or with greater detail and (ii) contain the information
required by Article 9 of the Uniform Commercial Code of each applicable
jurisdiction for the filing of any financing statement or amendment, including
(A) whether such Grantor is an organization, the type of organization and any
organizational identification number issued to such Grantor and (B) in the case
of a financing statement filed as a fixture filing or covering Article 9
Collateral constituting minerals or the like to be extracted or timber to be
cut, a sufficient description of the real property to which such Article 9
Collateral relates.  Each Grantor agrees
to provide such information to the Collateral Agent promptly upon request.

Each Grantor also ratifies its authorization for the
Collateral Agent to file in any relevant jurisdiction any initial financing
statements or amendments thereto if filed prior to the date hereof.

The Collateral Agent is further authorized to file
with the United States Patent and Trademark Office or the United States
Copyright Office (or any successor office or any similar office in any other
country) such documents as may be necessary or advisable for the purpose of
perfecting, confirming, continuing, enforcing or protecting the Security
Interest granted by each Grantor, without the signature of any Grantor, and
naming any Grantor or the Grantors as debtors and the Collateral Agent as
secured party.

(c)  The Security Interest is
granted as security only and shall not subject the Collateral Agent or any
other Secured Party to, or in any way alter or modify, any obligation or
liability of any Grantor with respect to or arising out of the Article 9
Collateral.

(d)  Notwithstanding anything
herein to the contrary, (i) in no event shall the Security Interest
granted hereunder attach to (x) any license, contract or agreement to which a
Grantor is a party or any of its rights or interests thereunder if and for so
long as the grant of such Security Interest shall constitute or result in (A)
the unenforceability of any right of the Grantor therein, (B) a breach or
termination pursuant to the terms of, or a default under, any such license,
contract or agreement (other than to the extent any such term would be rendered
ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the New York
UCC or any other applicable law or principles of equity) or (C) the violation
of any law applicable to such Grantor; or (y) any property or asset of any
Grantor that is subject to an Exclusive Lien but only if and for so long as the
grant of such Security Interest shall constitute or result in a default or
event of default under the agreement governing the Indebtedness or other
obligation secured by such Exclusive Lien; provided, however,
that, in the case of each of clauses (x) and (y) above, such Security
Interest shall attach immediately at such time as the conditions specified
therein for non-attachment of the Security Interest granted hereunder shall be
remedied or shall cease to exist and, to the extent severable, shall attach
immediately to such portion of such license, contract, agreement, property or
asset (including any proceeds of any of the foregoing) as would not result in
any of the consequences set forth in clause (x) or meet the conditions set
forth in clause (y), as applicable; (ii) the Security Interest granted
hereunder shall be subject to the Rule 3-16 Provisions and the Deemed Dividend

 12
 

 

Provision; and
(iii) the term “Article 9 Collateral” shall not include any asset of any
Grantor to which the Security Interest has not (but only for so long as it has
not) attached pursuant to this paragraph.

SECTION 3.02.  Representations and Warranties.  The Grantors jointly and severally represent
and warrant to the Collateral Agent and the other Secured Parties that:

(a)  Each Grantor has rights in
or title to the Article 9 Collateral with respect to which it has
purported to grant a Security Interest hereunder and has full power and authority
to grant to the Collateral Agent, for the benefit of the Secured Parties, the
Security Interest in such Article 9 Collateral pursuant hereto and to
execute, deliver and perform its obligations in accordance with the terms of
this Agreement, without the consent or approval of any other Person other than
any consent or approval that has been obtained.

(b)  The Perfection Certificate
has been duly prepared, completed and executed and the information set forth
therein, including the exact legal name of each Grantor, is correct and
complete as of the Issue Date.  The
Uniform Commercial Code financing statements (including fixture filings, as
applicable) or other appropriate filings, recordings or registrations prepared
by the Collateral Agent based upon the information provided to the Collateral
Agent in the Perfection Certificate for filing in each governmental, municipal
or other office specified in Schedule 2 to the Perfection Certificate (or
specified by notice from the Company to the Collateral Agent after the Issue
Date in the case of filings, recordings or registrations required by Section
3.03 hereof), are all the filings, recordings and registrations (other than
filings required to be made in the United States Patent and Trademark Office
and the United States Copyright Office in order to perfect the Security
Interest in Article 9 Collateral consisting of United States Patents,
Trademarks and Copyrights) that are necessary to publish notice of and protect
the validity of and to establish a legal, valid and perfected security interest
in favor of the Collateral Agent (for the benefit of the Secured Parties) in
respect of all Article 9 Collateral in which the Security Interest may be
perfected by filing, recording or registration in the United States (or any
political subdivision thereof) and its territories and possessions, and no
further or subsequent filing, refiling, recording, rerecording, registration or
reregistration is necessary in any such jurisdiction, except as provided under
applicable law with respect to the filing of continuation statements.  Each Grantor shall ensure that a fully
executed agreement in a form reasonably satisfactory to the Collateral Agent (a
“Short Form Security Agreement”) that contains a description of all
Article 9 Collateral consisting of the applicable type of Intellectual
Property shall have been received by the Collateral Agent (i) within three
months after the execution of this Agreement with respect to United States
Patents and United States Trademarks (and Trademarks for which the United
States registration applications are pending) for recording by the United
States Patent and Trademark Office pursuant to 35 U.S.C. § 261,
15 U.S.C. § 1060 and the regulations thereunder and (ii) within
one month after the execution of this Agreement with respect to the United
States registered Copyrights for recording by the United States Copyright
Office pursuant to 17 U.S.C. § 205 and the regulations
thereunder, in each case, to protect the validity of and to establish a legal,

 13
 

 

valid and
perfected security interest in favor of the Collateral Agent (for the benefit
of the Secured Parties) in respect of all Article 9 Collateral consisting
of Patents, Trademarks and Copyrights in which a security interest may be
perfected by filing, recording or registration in the United States (or any
political subdivision thereof) and its territories and possessions and no
further or subsequent filing, refiling, recording, rerecording, registration or
reregistration is necessary (other than such actions as are necessary to
perfect the Security Interest with respect to any Article 9 Collateral
consisting of Patents, Trademarks and Copyrights (or registration or
application for registration thereof) acquired or developed after the date
hereof).

(c)  The Security Interest
constitutes (i) a legal and valid security interest in all the
Article 9 Collateral securing the payment and performance of the Secured
Obligations, (ii) subject to the filings described in
Section 3.02(b), a perfected security interest in all Article 9
Collateral in which a security interest may be perfected by filing, recording
or registering a financing statement or analogous document in the United States
(or any political subdivision thereof) and its territories and possessions pursuant
to the Uniform Commercial Code and (iii) a security interest that shall be
perfected in all Article 9 Collateral in which a security interest may be
perfected upon the receipt of an executed Short Form Security Agreement from
the applicable Grantor and the recording of such Short Form Security Agreement
by the Collateral Agent with the United States Patent and Trademark Office or
the United States Copyright Office, as applicable, within the three-month
period (commencing as of the date hereof) pursuant to 35 U.S.C. § 261
or 15 U.S.C. § 1060 or the one-month period (commencing as of the
date hereof) pursuant to 17 U.S.C. § 205.  The Security Interest is and shall be prior
to any other Lien on any of the Article 9 Collateral, other than Liens
securing First-Priority Lien Obligations or Pari Passu Lien Obligations and
Permitted Collateral Liens that have priority as a matter of law.

(d)  The Article 9
Collateral is owned by the Grantors free and clear of any Lien, except for
Permitted Collateral Liens.  None of the
Grantors has filed or consented to the filing of (i) any financing
statement or analogous document under the Uniform Commercial Code or any other
applicable laws covering any Article 9 Collateral, (ii) any
assignment in which any Grantor assigns any Collateral or any security
agreement or similar instrument covering any Article 9 Collateral with the
United States Patent and Trademark Office or the United States Copyright Office
or (iii) any assignment in which any Grantor assigns any Article 9
Collateral or any security agreement or similar instrument covering any
Article 9 Collateral with any foreign governmental, municipal or other
office, which financing statement or analogous document, assignment, security
agreement or similar instrument is still in effect, except, in each case, for
Permitted Collateral Liens.

SECTION 3.03.  Covenants. 
(a)   Each Grantor agrees promptly
to notify the Collateral Agent in writing of any change in (i) its legal
name, (ii) the location of its chief executive office, its principal place
of business, any office in which it maintains books or records relating to
Article 9 Collateral owned by it or any office or facility at which
Article 9 Collateral owned by it is located (including the establishment
of any such new office or facility), (iii) its identity or type of
organization or corporate structure,

 14
 

 

(iv) its
Federal Taxpayer Identification Number or organizational identification number
or (v) its jurisdiction of organization. 
Each Grantor agrees to promptly provide the Collateral Agent with
certified organizational documents reflecting any of the changes described in
the first sentence of this paragraph. 
Each Grantor agrees not to effect or permit any change referred to in
the preceding sentence unless all filings have been made under the Uniform
Commercial Code or otherwise that are required in order for the Collateral
Agent to continue at all times following such change to have a valid, legal and
perfected security interest in all the Article 9 Collateral.

(b)  Each Grantor agrees to
maintain, at its own cost and expense, records with respect to the
Article 9 Collateral owned by it in accordance with the prudent and
standard practices used in industries that are the same as or similar to those
in which such Grantor is engaged, but in any event to include accounting
records that are complete in all material respects and indicate all payments
and proceeds received with respect to any part of the Article 9
Collateral, and, at such time or times as the Collateral Agent may reasonably
request, promptly to prepare and deliver to the Collateral Agent a duly
certified schedule or schedules in form and detail satisfactory to the
Collateral Agent showing the identity, amount and location of any and all
Article 9 Collateral; provided that prior to the Discharge of
Senior Lender Claims, the Grantors’ obligations under this paragraph to prepare
and deliver such schedules may be satisfied by the prompt delivery by the
Company to the Collateral Agent of the comparable schedules delivered to the
Intercreditor Agent pursuant to the Credit Agreement.

(c)  Each year, at the time of
delivery of annual financial statements of Parent with respect to the preceding
fiscal year pursuant to the Indenture, Parent shall deliver to the Collateral
Agent a certificate executed by an Officer thereof (i) setting forth the
information required by the Perfection Certificate or confirming that there has
been no change in such information since the date of the Perfection Certificate
delivered on the Issue Date or the date of the certificate most recently
delivered pursuant to this paragraph, as applicable, and (ii) certifying
that all Uniform Commercial Code financing statements (including fixture
filings, as the case may be) or other appropriate filings, recordings or
registrations, including all refilings, rerecordings and reregistrations,
containing a description of the Collateral have been filed of record in each
governmental, municipal or other appropriate office in each jurisdiction
identified pursuant to paragraph (a) of this Section 3.03 to the extent
necessary to protect or perfect the Security Interest for a period of not less
than 18 months after the date of such certificate (except as noted therein
with respect to any continuation statements to be filed within such
period).  Each certificate delivered
pursuant to this paragraph shall identify in the format of Schedule III
all Intellectual Property of any Grantor in existence on the date thereof and
not then listed on such Schedules or previously so identified to the Collateral
Agent.

(d)  Each Grantor shall, at its
own expense, take any and all commercially reasonable actions necessary to
defend title to the Article 9 Collateral against all Persons and to defend
the Security Interest of the Collateral Agent in the Article 9 Collateral
and the priority thereof, in each case, against any Lien other than Permitted
Collateral Liens.

 15
 

 

(e)  Subject to any specific
limitation contained herein, each Grantor agrees, at its own expense, to
execute, acknowledge, deliver and cause to be duly filed all such further
instruments and documents and take all such actions as the Collateral Agent may
from time to time reasonably request to better assure, preserve, protect and
perfect the Security Interest and the rights and remedies created hereby,
including the payment of any fees and taxes required in connection with the
execution and delivery of this Agreement, the granting of the Security Interest
and the filing of any financing statements (including fixture filings) or other
documents in connection herewith or therewith. 
If any amount payable under or in connection with any of the
Article 9 Collateral shall be or become evidenced by any promissory note
or other instrument, such note or instrument shall, subject to the Rule 3-16
Provisions, be immediately pledged and delivered to the Collateral Agent (or,
prior to the Discharge of Senior Lender Claims, the Intercreditor Agent), duly
endorsed in a manner satisfactory to the Collateral Agent (or, prior to the
Discharge of Senior Lender Claims, the Intercreditor Agent).

Without limiting the generality of the foregoing, each
Grantor hereby authorizes the Collateral Agent, with prompt notice thereof to
the Grantors, to supplement this Agreement by supplementing Schedule III
or adding additional schedules hereto to specifically identify any asset or
item that may constitute Copyrights, Licenses, Patents or Trademarks, provided that any Grantor shall
have the right, exercisable within 10 days after it has been notified by
the Collateral Agent of the specific identification of such Collateral, to
advise the Collateral Agent in writing of any inaccuracy of the representations
and warranties made by such Grantor hereunder with respect to such Collateral.  Each Grantor agrees that it will use its best
efforts to take such action as shall be necessary in order that all
representations and warranties hereunder shall be true and correct with respect
to such Collateral within 30 days after the date it has been notified by
the Collateral Agent of the specific identification of such Collateral.

(f)  At any time after the
Discharge of Senior Lender Claims, at its option, the Collateral Agent may
discharge past due taxes, assessments, charges, fees, Liens, security interests
or other encumbrances at any time levied or placed on the Article 9
Collateral and not permitted under the Indenture, and may pay for the
maintenance and preservation of the Article 9 Collateral to the extent any
Grantor fails to do so as required by this Agreement, and each Grantor jointly
and severally agrees to reimburse the Collateral Agent on demand for any
payment made or any expense incurred by the Collateral Agent pursuant to the
foregoing authorization, provided
that nothing in this paragraph shall be interpreted as excusing any Grantor
from the performance of, or imposing any obligation on the Collateral Agent or
any Secured Party to cure or perform, any covenants or other promises of any
Grantor with respect to taxes, assessments, charges, fees, Liens, security interests
or other encumbrances and maintenance as set forth herein or in the other
Noteholder Documents.

(g)  If at any time any Grantor
shall take a security interest in any property of an Account Debtor or any
other Person with a fair market value in excess of $100,000 to secure payment
and performance of an Account, such Grantor shall promptly assign such security
interest to the Collateral Agent, for the benefit of the Secured Parties.  Such assignment need not be filed of public
record unless necessary to continue the perfected

 16
 

 

status of the
security interest against creditors of and transferees from the Account Debtor
or other Person granting the security interest.

(h)  Each Grantor shall remain
liable to observe and perform all the conditions and obligations to be observed
and performed by it under each contract, agreement or instrument relating to
the Article 9 Collateral, all in accordance with the terms and conditions
thereof, and each Grantor jointly and severally agrees to indemnify and hold harmless
the Collateral Agent and the Secured Parties from and against any and all
liability for such performance.

(i)  None of the Grantors shall
make or permit to be made an assignment, pledge or hypothecation of the Article
9 Collateral or shall grant any other Lien in respect of the Article 9
Collateral, except as permitted by the Indenture.  None of the Grantors shall make or permit to
be made any transfer of the Article 9 Collateral and each Grantor shall remain
at all times in possession of the Article 9 Collateral owned by it, except
to the extent not prohibited by the Indenture.

(j)  The Grantors, at their own
expense, shall maintain, with financially sound and reputable carriers,
insurance in such amounts and against such risks as is customarily maintained by
companies of established repute engaged in the same or similar businesses
operating in the same or similar locations and considered adequate by Parent
and the Company, as well as such insurance as may be required by law.  Each Grantor irrevocably makes, constitutes
and appoints the Collateral Agent (and all officers, employees or agents
designated by the Collateral Agent) as such Grantor’s true and lawful agent
(and attorney-in-fact) for the purpose, upon the occurrence and
during the continuance of an Event of Default at any time after the Discharge
of Senior Lender Claims, of making, settling and adjusting claims in respect of
Article 9 Collateral under policies of insurance, endorsing the name of
such Grantor on any check, draft, instrument or other item of payment for the
proceeds of such policies of insurance and for making all determinations and
decisions with respect thereto.  In the
event that any Grantor at any time or times shall fail to obtain or maintain any
of the policies of insurance required hereby or to pay any premium in whole or
part relating thereto, the Collateral Agent may, without waiving or releasing
any obligation or liability of the Grantors hereunder or any Event of Default,
in its sole discretion, obtain and maintain such policies of insurance and pay
such premium and take any other actions with respect thereto as the Collateral
Agent deems advisable.  All sums
disbursed by the Collateral Agent in connection with this paragraph, including
reasonable attorneys’ fees, court costs, expenses and other charges relating
thereto, shall be payable, upon demand, by the Grantors to the Collateral Agent
and shall be additional Secured Obligations secured hereby.  The Grantors shall, promptly after the Discharge
of Senior Lender Claims, cause the Collateral Agent to be named as loss payee
on all property insurance maintained in respect of the Collateral.

(k)  After the Discharge of
Senior Lender Claims, none of the Grantors will, without the Collateral Agent’s
prior written consent, grant any extension of time of payment of any Accounts
included in the Article 9 Collateral, compromise, compound or settle the same
for less than the full amount thereof, release, wholly or partly, any person
liable for the payment thereof or allow any credit or discount whatsoever
thereon, other

 17
 

 

than
extensions, compromises, settlements, releases, credits or discounts granted or
made in the ordinary course of business and consistent with prudent business
practices.

SECTION 3.04.  Other Actions.  In order to further ensure the attachment,
perfection and priority of, and the ability of the Collateral Agent to enforce,
the Security Interest, each Grantor agrees, in each case at such Grantor’s own
expense, to take the following actions with respect to the following Article 9
Collateral:

(a) Instruments.  If any Grantor shall at any time hold or
acquire any Instrument (other than items deposited for collection) evidencing
an amount in excess of $100,000, such Grantor shall forthwith endorse and
assign the same to the Collateral Agent (and deliver the same to the Collateral
Agent or, prior to the Discharge of Senior Lender Claims, to the Intercreditor
Agent), accompanied by such instruments of transfer or assignment duly executed
in blank as the Collateral Agent or the Intercreditor Agent, as applicable, may
from time to time reasonably request.

(b) Deposit Accounts.  For each deposit account that any Grantor at
any time opens or maintains, such Grantor shall use its commercially reasonable
efforts to cause the depositary bank to agree to comply at any time with
instructions from the Collateral Agent (or, prior to the Discharge of Senior
Lender Claims, the Intercreditor Agent, acting as a sub-agent of the Collateral
Agent) to such depositary bank directing the disposition of funds from time to
time credited to such deposit account, without further consent of such Grantor
or any other Person, pursuant to an agreement in form and substance reasonably
satisfactory to the Collateral Agent (or, prior to the Discharge of Senior Lender
Claims, the Intercreditor Agent).  The
provisions of this paragraph will not apply to (i) any Deposit Account for
which the Collateral Agent (or, prior to the Discharge of Senior Lender Claims,
the Intercreditor Agent) is the depositary and (ii) any Deposit Account
specifically and exclusively used for payroll, payroll taxes or other employee
wage or benefit payments to or for the benefit of the applicable Grantor’s
employees.

(c) Investment Property.  Except to the extent otherwise provided in
Article II (including the Rule 3-16 Provisions thereof), if any Grantor
shall at any time hold or acquire any certificated securities with a value in
excess of $100,000, such Grantor shall forthwith endorse and assign the same to
the Collateral Agent (and deliver the same to the Collateral Agent or, prior to
the Discharge of Senior Lender Claims, to the Intercreditor Agent), accompanied
by such instruments of transfer or assignment duly executed in blank as the
Collateral Agent or the Intercreditor Agent, as applicable, may from time to
time specify.  If any securities now or
hereafter acquired by any Grantor are uncertificated and are issued to such
Grantor or its nominee directly by the issuer thereof, such Grantor shall immediately
notify the Collateral Agent thereof and, at the Intercreditor Agent’s (if prior
to the Discharge of Senior Lender Claims) or the Collateral Agent’s (if after
the Discharge of Senior Lender Claims) reasonable request and option, pursuant
to an agreement in form and substance reasonably satisfactory to

 18
 

 

the Collateral Agent or the Intercreditor
Agent, as applicable, either (i) cause the issuer to agree to comply with
instructions from the Collateral Agent (or, prior to the Discharge of Senior
Lender Claims, the Intercreditor Agent, acting as a sub-agent of the Collateral
Agent) as to such securities, without further consent of any Grantor or such
nominee, (ii) arrange for the Collateral Agent (or, prior to the Discharge
of Senior Lender Claims, the Intercreditor Agent) to become the registered
owner of the securities or (iii) take appropriate steps under applicable
foreign law to effectuate perfection. 
Other than investment property held by any Grantor or its nominee
through a securities intermediary or commodities intermediary that is subject
to a lien described in paragraph (d) of the definition of the term “Permitted
Encumbrances” in the Credit Agreement, as in effect on the date hereof, or in
connection with any hedging agreement permitted under the Credit Agreement and
the Indenture, if any securities with a balance in excess of $100,000, whether
certificated or uncertificated, or other investment property now or hereafter
acquired by any Grantor are held by such Grantor or its nominee through a
securities intermediary or commodity intermediary, such Grantor shall
immediately notify the Collateral Agent thereof and, at the Intercreditor Agent’s
(if prior to the Discharge of Senior Lender Claims) or the Collateral Agent’s
(if after the Discharge of Senior Lender Claims) request and option, pursuant
to an agreement in form and substance reasonably satisfactory to the Collateral
Agent or the Intercreditor Agent, as applicable, either (i) cause such
securities intermediary or commodity intermediary to agree to comply with
entitlement orders or other instructions from the Collateral Agent (or, prior
to the Discharge of Senior Lender Claims, the Intercreditor Agent, acting as a
sub-agent of the Collateral Agent) to such securities intermediary as to such
security entitlements, or to apply any value distributed on account of any
commodity contract as directed by the Collateral Agent (or, prior to the
Discharge of Senior Lender Claims, the Intercreditor Agent, acting as a
sub-agent of the Collateral Agent) to such commodity intermediary, in each case
without further consent of any Grantor or such nominee, or (ii) in the
case of financial assets or other Investment Property held through a securities
intermediary, arrange for the Collateral Agent (or, prior to the Discharge of
Senior Lender Claims, the Intercreditor Agent) to become the entitlement holder
with respect to such investment property, with the Grantor being permitted,
only with the consent of the Collateral Agent or the Intercreditor Agent, as
applicable, to exercise rights to withdraw or otherwise deal with such
investment property.  The Collateral
Agent agrees with each of the Grantors that the Collateral Agent shall not give
any such entitlement orders or instructions or directions to any such issuer,
securities intermediary or commodity intermediary, and shall not withhold its
consent to the exercise of any withdrawal or dealing rights by any Grantor,
unless an Event of Default has occurred and is continuing, or, after giving
effect to any such investment and withdrawal rights, would occur.  The provisions of this paragraph shall not
apply to any financial assets credited to a securities account for which the
Collateral Agent or the Intercreditor Agent is the securities intermediary.

 19
 

 

(d) Electronic
Chattel Paper and Transferable Records.  If any Grantor at any time holds or acquires
an interest in any electronic chattel paper or any “transferable record,” as
that term is defined in Section 201 of the Federal Electronic Signatures
in Global and National Commerce Act, or in Section 16 of the Uniform
Electronic Transactions Act as in effect in any relevant jurisdiction
evidencing an amount in excess of $100,000, such Grantor shall promptly notify
the Collateral Agent thereof and, at the request of the Intercreditor Agent (if
prior to the Discharge of Senior Lender Claims) or the Collateral Agent (if
after the Discharge of Senior Lender Claims), shall take such action as the
Collateral Agent or the Intercreditor Agent, as applicable, may reasonably
request to vest in the Collateral Agent (or, prior to the Discharge of Senior
Lender Claims, the Intercreditor Agent, acting as a sub-agent of the Collateral
Agent) control under New York UCC Section 9-105 of such
electronic chattel paper or control under Section 201 of the Federal
Electronic Signatures in Global and National Commerce Act or, as the case may
be, Section 16 of the Uniform Electronic Transactions Act, as so in effect
in such jurisdiction, of such transferable record.  The Collateral Agent agrees with such Grantor
that, after the Discharge of Senior Lender Claims, the Collateral Agent will
arrange, pursuant to procedures reasonably satisfactory to the Collateral Agent
and so long as such procedures will not result in the Collateral Agent’s loss
of control, for the Grantor to make alterations to the electronic chattel paper
or transferable record permitted under UCC Section 9-105 or, as the case
may be, Section 201 of the Federal Electronic Signatures in Global and
National Commerce Act or Section 16 of the Uniform Electronic Transactions
Act for a party in control to allow alterations without loss of control, unless
an Event of Default has occurred and is continuing or would occur after taking
into account any action by such Grantor with respect to such electronic chattel
paper or transferable record.

(e) Letter-of-Credit Rights.  If any Grantor is at any time a beneficiary
under a letter of credit with a face amount in excess of $100,000, now or
hereafter issued in favor of such Grantor, such Grantor shall promptly notify
the Collateral Agent thereof and, at the request and option of the
Intercreditor Agent (if prior to the Discharge of Senior Lender Claims) or the
Collateral Agent (if after the Discharge of Senior Lender Claims), such Grantor
shall, pursuant to an agreement in form and substance reasonably satisfactory
to the Collateral Agent or the Intercreditor Agent, as applicable, either
(i) arrange for the issuer and any confirmer of such letter of credit to
consent to an assignment to the Collateral Agent (or, prior to the Discharge of
Senior Lender Claims, the Intercreditor Agent) of the proceeds of any drawing
under the letter of credit or (ii) arrange for the Collateral Agent (or,
prior to the Discharge of Senior Lender Claims, the Intercreditor Agent) to
become the transferee beneficiary of the letter of credit,

 20
 

 

with the Collateral Agent agreeing, in each
case, that the proceeds of any drawing under the letter of credit are to be
paid to the applicable Grantor unless an Event of Default has occurred or is
continuing.

(f) Commercial Tort Claims.  If any Grantor shall at any time hold or
acquire (i) a filed Commercial Tort Claim or (ii) to the knowledge of
any Officer of Parent or any of its Subsidiaries, an unfiled Commercial Tort
Claim, in each case in an amount reasonably estimated to exceed $500,000, the
Grantor shall promptly notify the Collateral Agent thereof in a writing signed
by such Grantor including a summary description of such claim and grant to the
Collateral Agent in such writing a security interest therein and in the proceeds
thereof, all upon the terms of this Agreement, with such writing to be in form
and substance reasonably satisfactory to the Collateral Agent.

(g) Collateral Access Agreements.  Each Grantor shall use commercially
reasonable efforts to obtain a Collateral Access Agreement from the lessor of
each leased property, mortgagee of each owned property or bailee or consignee
with respect to each warehouse, processor and converter facility and any other
location where Collateral is stored or located, which agreement shall be
reasonably satisfactory in form and substance to the Collateral Agent (or,
prior to the Discharge of Senior Lender Claims, the Intercreditor Agent).

(h) Federal, State or Municipal Claims.  Each Grantor shall promptly notify the
Collateral Agent of any Collateral which constitutes a claim in excess of
$100,000 against the United States government or any state or local government
or any instrumentality or agency thereof, the assignment of which claim is
restricted by U.S. Federal, state or municipal law.

SECTION 3.05.  Covenants Regarding Patent, Trademark and Copyright
Collateral.  (a)  Each Grantor agrees that it (i) will not
do any act or omit to do any act (and will exercise commercially reasonable
efforts to prevent its licensees from doing any act or omitting to do any act),
whereby any Patent that is material to the conduct of such Grantor’s business
may become invalidated or dedicated to the public and (ii) shall continue
to mark any products covered by a Patent with the relevant patent number as
necessary and sufficient to establish and preserve its maximum rights under
applicable patent laws.

(b)  Each Grantor (either itself
or through its licensees or its sublicensees) will, for each Trademark material
to the conduct of such Grantor’s business, (i) maintain such Trademark in
full force free from any claim of abandonment or invalidity for non-use,
(ii) maintain the quality of products and services offered under such
Trademark, (iii) display such Trademark with notice of Federal or foreign
registration to the extent necessary and sufficient to establish and preserve
its maximum rights under applicable law and (iv) not knowingly use or
knowingly permit the use of such Trademark in violation of any third party
rights.

 21

 

(c)  Each Grantor (either itself
or through its licensees or sublicensees) will, for each work covered by a
material Copyright, continue to publish, reproduce, display, adopt and
distribute the work with appropriate copyright notice as necessary and sufficient
to establish and preserve its maximum rights under applicable copyright laws.

(d)  Each Grantor shall notify
the Collateral Agent promptly if it knows that any Patent, Trademark or
Copyright material to the conduct of its business may become abandoned, lost or
dedicated to the public, or of any materially adverse determination or material
development (including the institution of, or any such determination or
material development in, any proceeding in the United States Patent and
Trademark Office, United States Copyright Office or any court or similar office
of any country) regarding such Grantor’s ownership of any such Patent,
Trademark or Copyright, its right to register the same, or its right to keep
and maintain the same.

(e)  In no event shall any Grantor,
either itself or through any agent, employee, licensee or designee, file an
application for any Patent, Trademark or Copyright (or for the registration of
any Trademark or Copyright) with the United States Patent and Trademark Office,
United States Copyright Office or any office or agency in any political
subdivision of the United States or in any other country or any political
subdivision thereof, unless it promptly informs the Collateral Agent, provides
to the Collateral Agent a revised Schedule III to supplement this Agreement
and, upon request of the Collateral Agent, executes and delivers any and all
agreements, instruments, documents and papers as the Collateral Agent may
reasonably request to evidence the Collateral Agent’s security interest in such
Patent, Trademark or Copyright, and each Grantor hereby appoints the Collateral
Agent as its attorney-in-fact to execute and file such writings for
the foregoing purposes, all acts of such attorney being hereby ratified and
confirmed; such power, being coupled with an interest, is irrevocable.

(f)  Each Grantor will take all
necessary steps that are consistent with the practice in any proceeding before
the United States Patent and Trademark Office, United States Copyright Office
or any office or agency in any political subdivision of the United States or in
any other country or any political subdivision thereof, to maintain and pursue
each material application relating to the Patents, Trademarks and/or Copyrights
(and to obtain the relevant grant or registration) and to maintain each issued
Patent and each registration of the Trademarks and Copyrights that is material
to the conduct of any Grantor’s business, including timely filings of
applications for renewal, affidavits of use, affidavits of incontestability and
payment of maintenance fees, and, if consistent with good business judgment, to
initiate opposition, interference and cancelation proceedings against third
parties.

(g)  In the event that any
Grantor becomes aware that any Article 9 Collateral consisting of a
Patent, Trademark or Copyright material to the conduct of any Grantor’s
business has been or is about to be infringed, misappropriated or diluted by a
third party in any material respect, such Grantor promptly shall notify the
Collateral Agent and shall, if consistent with good business judgment, promptly
sue for infringement, misappropriation or dilution and to recover any and all
damages for such

 22
 

 

infringement,
misappropriation or dilution, and take such other actions as are appropriate
under the circumstances to protect such Article 9 Collateral.

(h)  Upon the occurrence and
during the continuance of an Event of Default, each Grantor shall use its
commercially reasonable efforts to obtain all requisite consents or approvals
by the licensor of each Copyright License, Patent License or Trademark License
to effect the assignment of all such Grantor’s right, title and interest
thereunder to the Collateral Agent or its designee.

ARTICLE IV

Remedies

SECTION 4.01.  Remedies Upon Default.  Upon the occurrence and during the
continuance of an Event of Default, each Grantor agrees to deliver each item of
Collateral to the Collateral Agent on demand, and it is agreed that the
Collateral Agent shall have the right to take any of or all the following
actions at the same or different times: 
(a) with respect to any Article 9 Collateral consisting of
Intellectual Property, on demand, to cause the Security Interest to become an
assignment, transfer and conveyance of any of or all such Article 9 Collateral
by the applicable Grantors to the Collateral Agent, or to license or
sublicense, whether general, special or otherwise, and whether on an exclusive
or nonexclusive basis, any such Article 9 Collateral throughout the world on
such terms and conditions and in such manner as the Collateral Agent shall
determine (other than in violation of any applicable laws or regulations or
then-existing licensing arrangements to the extent that waivers cannot be
obtained), and (b) with or without legal process and with or without prior
notice or demand for performance, to take possession of the Article 9
Collateral and without liability for trespass to enter any premises where the
Article 9 Collateral may be located for the purpose of taking possession of or
removing the Article 9 Collateral and, generally, to exercise any and all
rights afforded to a secured party under the Uniform Commercial Code or other
applicable law (including  giving notice
of sole control or any other instruction under any deposit account control agreement
or any other control agreement with any securities intermediary and take any
action therein with respect to such Collateral).  Without limiting the generality of the
foregoing, each Grantor agrees that the Collateral Agent shall have the right,
subject to the mandatory requirements of applicable law, to sell or otherwise
dispose of all or any part of the Collateral at a public or private sale or at
any broker’s board or on any securities exchange, for cash, upon credit or for
future delivery as the Collateral Agent shall deem appropriate.  The Collateral Agent shall be authorized at
any such sale of securities (if it deems it advisable to do so) to restrict the
prospective bidders or purchasers to Persons who will represent and agree that
they are purchasing the Collateral for their own account for investment and not
with a view to the distribution or sale thereof, and upon consummation of any
such sale the Collateral Agent shall have the right to assign, transfer and
deliver to the purchaser or purchasers thereof the Collateral so sold.  Each such purchaser at any such sale of
Collateral shall hold the property sold absolutely, free from any claim or
right on the part of any Grantor, and each Grantor hereby waives (to the extent
permitted by law) all rights of redemption, stay and appraisal

 23
 

 

which such
Grantor now has or may at any time in the future have under any rule of law or
statute now existing or hereafter enacted.

The Collateral Agent shall give the applicable
Grantors 10 days’ written notice (which each Grantor agrees is reasonable
notice within the meaning of Section 9-611 of the New York UCC
or its equivalent in other jurisdictions) of the Collateral Agent’s intention
to make any sale of Collateral.  Such
notice, in the case of a public sale, shall state the time and place for such
sale and, in the case of a sale at a broker’s board or on a securities
exchange, shall state the board or exchange at which such sale is to be made
and the day on which the Collateral, or portion thereof, will first be offered
for sale at such board or exchange.  Any
such public sale shall be held at such time or times within ordinary business
hours and at such place or places as the Collateral Agent may fix and state in
the notice (if any) of such sale.  At any
such sale, the Collateral, or portion thereof, to be sold may be sold in one
lot as an entirety or in separate parcels, as the Collateral Agent may (in its
sole and absolute discretion) determine. 
The Collateral Agent shall not be obligated to make any sale of any
Collateral if it shall determine not to do so, regardless of the fact that
notice of sale of such Collateral shall have been given.  The Collateral Agent may, without notice or
publication, adjourn any public or private sale or cause the same to be adjourned
from time to time by announcement at the time and place fixed for sale, and
such sale may, without further notice, be made at the time and place to which
the same was so adjourned.  In case any
sale of all or any part of the Collateral is made on credit or for future
delivery, the Collateral so sold may be retained by the Collateral Agent until
the sale price is paid by the purchaser or purchasers thereof, but the
Collateral Agent shall not incur any liability in case any such purchaser or
purchasers shall fail to take up and pay for the Collateral so sold and, in
case of any such failure, such Collateral may be sold again upon like
notice.  At any public (or, to the extent
permitted by law, private) sale made pursuant to this Agreement, any Secured
Party may bid for or purchase, free (to the extent permitted by law) from any
right of redemption, stay, valuation or appraisal on the part of any Grantor
(all said rights being also hereby waived and released to the extent permitted
by law), the Collateral or any part thereof offered for sale and may make
payment on account thereof by using any claim then due and payable to such
Secured Party from any Grantor as a credit against the purchase price, and such
Secured Party may, upon compliance with the terms of sale, hold, retain and
dispose of such property without further accountability to any Grantor
therefor.  For purposes hereof, a written
agreement to purchase the Collateral or any portion thereof shall be treated as
a sale thereof; the Collateral Agent shall be free to carry out such sale
pursuant to such agreement and no Grantor shall be entitled to the return of
the Collateral or any portion thereof subject thereto, notwithstanding the fact
that after the Collateral Agent shall have entered into such an agreement all
Events of Default shall have been remedied and the Secured Obligations paid in
full.  As an alternative to exercising
the power of sale herein conferred upon it, the Collateral Agent may proceed by
a suit or suits at law or in equity to foreclose this Agreement and to sell the
Collateral or any portion thereof pursuant to a judgment or decree of a court
or courts having competent jurisdiction or pursuant to a proceeding by a court-appointed
receiver.  Any sale pursuant to the
provisions of this Section 4.01 shall be deemed to conform to the
commercially reasonable standards as

 24
 

 

provided in
Section 9-610(b) of the New York UCC or its equivalent in other
jurisdictions.

SECTION 4.02.  Application of Proceeds.  The Collateral Agent shall pay over the
proceeds of any collection or sale of Collateral, including any Collateral
consisting of cash, to the Trustee, to be applied in the manner set forth in
Section 6.10 of the Indenture, provided
that the Collateral Agent may deduct from any such proceeds amounts
representing, and shall apply such amounts to the payment of, all costs and
expenses incurred by the Collateral Agent in connection with such collection or
sale or otherwise in connection with this Agreement, any other Noteholder
Document or any of the Secured Obligations, including all court costs and the
fees and expenses of its agents and legal counsel, the repayment of all
advances made by the Collateral Agent hereunder or under any other Noteholder
Document on behalf of any Grantor and any other costs or expenses incurred in
connection with the exercise of any right or remedy hereunder or under any
other Noteholder Document.

Upon any sale of Collateral by the Collateral Agent
(including pursuant to a power of sale granted by statute or under a judicial
proceeding), the receipt of the Collateral Agent or of the officer making the
sale shall be a sufficient discharge to the purchaser or purchasers of the
Collateral so sold and such purchaser or purchasers shall not be obligated to
see to the application of any part of the purchase money paid over to the
Collateral Agent or such officer or be answerable in any way for the
misapplication thereof.

SECTION 4.03.  Grant of License to Use Intellectual Property.  For the purpose of enabling the Collateral
Agent to exercise rights and remedies under this Agreement at such time as the
Collateral Agent shall be lawfully entitled to exercise such rights and
remedies, each Grantor hereby grants to the Collateral Agent an irrevocable,
nonexclusive license (exercisable without payment of royalty or other
compensation to the Grantors) to use, license or sublicense any of the
Article 9 Collateral consisting of Intellectual Property now owned or
hereafter acquired by such Grantor, and wherever the same may be located, and
including in such license reasonable access to all media in which any of the
licensed items may be recorded or stored and to all computer software and
programs used for the compilation or printout thereof.  The use of such license by the Collateral
Agent may be exercised, at the option of the Collateral Agent, upon the
occurrence and during the continuation of an Event of Default, provided
that any license, sublicense or other transaction entered into by the
Collateral Agent in accordance herewith shall be binding upon the Grantors
notwithstanding any subsequent cure of an Event of Default.

SECTION 4.04.  Securities Act.  In view of the position of the Grantors in
relation to the Pledged Collateral, or because of other current or future
circumstances, a question may arise under the Securities Act of 1933, as now or
hereafter in effect, or any similar statute hereafter enacted analogous in
purpose or effect (such Act and any such similar statute as from time to time
in effect being called the “Federal Securities Laws”) with respect to
any disposition of the Pledged Collateral permitted hereunder.  Each Grantor understands that compliance with
the Federal Securities Laws might very strictly

 25
 

 

limit the
course of conduct of the Collateral Agent if the Collateral Agent were to
attempt to dispose of all or any part of the Pledged Collateral, and might also
limit the extent to which or the manner in which any subsequent transferee of
any Pledged Collateral could dispose of the same.  Similarly, there may be other legal
restrictions or limitations affecting the Collateral Agent in any attempt to
dispose of all or part of the Pledged Collateral under applicable “blue sky” or
other state securities laws or similar laws analogous in purpose or
effect.  Each Grantor recognizes that in
light of such restrictions and limitations the Collateral Agent may, with
respect to any sale of the Pledged Collateral, limit the purchasers to those
who will agree, among other things, to acquire such Pledged Collateral for
their own account, for investment, and not with a view to the distribution or
resale thereof.  Each Grantor
acknowledges and agrees that in light of such restrictions and limitations, the
Collateral Agent, in its sole and absolute discretion (a) may proceed to
make such a sale whether or not a registration statement for the purpose of
registering such Pledged Collateral or part thereof shall have been filed under
the Federal Securities Laws and (b) may approach and negotiate with a
single potential purchaser to effect such sale. 
Each Grantor acknowledges and agrees that any such sale might result in
prices and other terms less favorable to the seller than if such sale were a
public sale without such restrictions. 
In the event of any such sale, the Collateral Agent shall incur no
responsibility or liability for selling all or any part of the Pledged
Collateral at a price that the Collateral Agent, in its sole and absolute
discretion, may in good faith deem reasonable under the circumstances,
notwithstanding the possibility that a substantially higher price might have
been realized if the sale were deferred until after registration as aforesaid
or if more than a single purchaser were approached.  The provisions of this Section 4.04 will
apply notwithstanding the existence of a public or private market upon which
the quotations or sales prices may exceed substantially the price at which the
Collateral Agent sells.

SECTION 4.05.  Registration.  Each Grantor agrees that, upon the occurrence
and during the continuance of an Event of Default, if for any reason the
Collateral Agent desires to sell any of the Pledged Collateral at a public
sale, it will, at any time and from time to time, upon the written request of
the Collateral Agent, use its best efforts to take or to cause the issuer of
such Pledged Collateral to take such action and prepare, distribute and/or file
such documents, as are required or advisable in the reasonable opinion of
counsel for the Collateral Agent to permit the public sale of such Pledged
Collateral.  Each Grantor further agrees
to indemnify, defend and hold harmless the Collateral Agent, each other Secured
Party, any underwriter and their respective officers, directors, affiliates and
controlling persons from and against all loss, liability, expenses, costs of
counsel (including, without limitation, reasonable fees and expenses of legal
counsel to the Collateral Agent), and claims (including the costs of
investigation) that they may incur insofar as such loss, liability, expense or
claim directly or indirectly arises out of or is based upon any alleged untrue
statement of a material fact contained in any prospectus (or any amendment or
supplement thereto) or in any notification or offering circular, or directly or
indirectly arises out of or is based upon any alleged omission to state a
material fact required to be stated therein or necessary to make the statements
in any thereof not misleading, except insofar as the same may have been caused
by any untrue statement or omission based upon information furnished in writing
to such Grantor or the issuer of such Pledged Collateral by the Collateral
Agent or any

 26
 

 

other Secured
Party expressly for use therein.  Each
Grantor further agrees, upon such written request referred to above, to use its
best efforts to qualify, file or register, or cause the issuer of such Pledged
Collateral to qualify, file or register, any of the Pledged Collateral under
the “blue sky” or other securities laws of such states as may be requested by
the Collateral Agent and keep effective, or cause to be kept effective, all
such qualifications, filings or registrations. 
Each Grantor will bear all costs and expenses of carrying out its
obligations under this Section 4.05. 
Each Grantor acknowledges that there is no adequate remedy at law for
failure by it to comply with the provisions of this Section 4.05 and that
such failure would not be adequately compensable in damages, and therefore
agrees that its agreements contained in this Section 4.05 may be
specifically enforced.

ARTICLE V

Indemnity, Subrogation and Subordination

SECTION 5.01.  Indemnity and Subrogation.  The Company agrees that in the event any
assets of any Grantor shall be sold pursuant to this Agreement or any other
Security Document to satisfy in whole or in part an obligation owed to any
Secured Party, the Company shall indemnify such Grantor in an amount equal to
the greater of the book value or the fair market value of the assets so sold.

SECTION 5.02.  Contribution and Subrogation.  Each Grantor (a “Contributing Party”)
agrees (subject to Section 5.03) that, in the event a payment shall be
made by any other Grantor hereunder in respect of any Secured Obligation or
assets of any other Grantor shall be sold pursuant to any Security Document to
satisfy any Secured Obligation owed to any Secured Party and such other Grantor
(the “Claiming Party”) shall not have been fully indemnified by the
Company as provided in Section 5.01, the Contributing Party shall
indemnify the Claiming Party in an amount equal to the amount of such payment
or the greater of the book value or fair market value of such assets, as the
case may be, in each case multiplied by a fraction of which the numerator shall
be the net worth of the Contributing Party on the date hereof (or, in the case
of any Grantor becoming a party hereto pursuant to Section 6.14, the date of
the supplement hereto executed and delivered by such Grantor) and the
denominator shall be the aggregate net worth of all the Grantors (other than
the Company) on the date hereof (or, in the case of any Guarantor or Grantor
becoming a party hereto pursuant to Section 6.14, the date of the supplement
hereto executed and delivered by such Grantor). 
Any Contributing Party making any payment to a Claiming Party pursuant
to this Section 5.02 shall be subrogated to the rights of such Claiming
Party under Section 5.01 to the extent of such payment.

SECTION 5.03.  Subordination.  (a) 
Notwithstanding any provision of this Agreement to the contrary, all
rights of the Grantors under Sections 5.01 and 5.02 and all other rights
of indemnity, contribution or subrogation under applicable law or otherwise
shall be fully subordinated to the indefeasible payment in full in cash of the
Secured Obligations.  No failure on the part
of any Grantor to make the payments required by Sections 5.01 and 5.02 (or
any other payments required under applicable law

 27
 

 

or otherwise)
shall in any respect limit the obligations and liabilities of any Grantor with
respect to its obligations hereunder, and each Grantor shall remain liable for
the full amount of the obligations of such Grantor hereunder.

(b)  Each Grantor hereby agrees
that all Indebtedness and other monetary obligations owed by it to any other
Grantor or any other Subsidiary shall be fully subordinated to the indefeasible
payment in full in cash of the Secured Obligations.

ARTICLE VI

Miscellaneous

SECTION 6.01.  Notices. 
All communications and notices hereunder shall (except as otherwise
expressly permitted herein) be in writing and given as provided in
Section 12.02 of the Indenture.  All
communications and notices hereunder to any Subsidiary Party shall be given to
it in care of the Company as provided in Section 12.02 of the Indenture.

SECTION 6.02.  Waivers; Amendment.  (a)  No
failure or delay by the Collateral Agent or any other Secured Party in
exercising any right or power hereunder or under any other Noteholder Document
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof
or the exercise of any other right or power. 
The rights and remedies of the Collateral Agent and the Secured Parties
hereunder and under the other Noteholder Documents are cumulative and are not
exclusive of any rights or remedies that they would otherwise have.  No waiver of any provision of this Agreement
or consent to any departure by any Grantor herefrom shall in any event be effective
unless the same shall be permitted by paragraph (b) of this Section 6.02,
and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. 
No notice or demand on any Grantor in any case shall entitle any Grantor
to any other or further notice or demand in similar or other circumstances.

(b)  None of this Agreement or
any provision hereof may be waived, amended or modified except pursuant to an
agreement or agreements in writing entered into by the Collateral Agent and the
Grantor or Grantors with respect to which such waiver, amendment or
modification is to apply, subject to any consent required under the Indenture; provided
that nothing in this paragraph shall affect the agreements set forth in Section
5.3 of the Intercreditor Agreement.

SECTION 6.03.  Collateral Agent’s Fees and Expenses; Indemnification.  (a) 
The Grantors agree to reimburse the Collateral Agent upon request for
all reasonable out-of-pocket expenses incurred or made by it in connection with
the performance of its duties and enforcement of its rights hereunder and
otherwise in connection with the preparation, operation, administration and
enforcement of this Agreement, including reasonable compensation and expenses,
disbursements and advances of the Collateral Agent’s agents, counsel,
accountants and experts.

 28
 

 

(b)  Each Grantor jointly and
severally agrees to indemnify the Collateral Agent, its Affiliates and their
respective officers, directors, employees, agents and representatives (the “Indemnitees”)
against, and hold each Indemnitee harmless from, any and all losses, claims,
damages, penalties, liabilities and related expenses, including the reasonable
fees, charges and disbursements of one counsel for the Indemnitees (in addition
to one local counsel in each relevant jurisdiction, including Canadian local
counsel), incurred by or asserted against any Indemnitee arising out of, in
connection with, or as a result of, the execution, delivery or performance of
this Agreement or any actual or prospective claim, litigation, investigation or
proceeding relating to any of the foregoing agreements or instruments
contemplated hereby, or to the Collateral (including any such claim,
litigation, investigation or proceeding brought by or on behalf of any Grantor
or any Affiliate of a Grantor), whether based on contract, tort or any theory,
regardless of whether or not any Indemnitee is a party thereto, provided that such indemnity
shall not, as to any Indemnitee, be available to the extent that such losses,
claims, damages, penalties, liabilities or related expenses are determined by a
court of competent jurisdiction by final judgment to have resulted from the
gross negligence, bad faith or willful misconduct of such Indemnitee or any of
its Affiliates.

(c)  Any such amounts payable as
provided hereunder shall be additional Secured Obligations secured hereby and
by the other Security Documents.  The
provisions of this Section 6.03 shall remain operative and in full force
and effect regardless of the termination of this Agreement or any other
Noteholder Document, the consummation of the transactions contemplated hereby,
the repayment of any of the Secured Obligations, the invalidity or
unenforceability of any term or provision of this Agreement or any other
Noteholder Document, or any investigation made by or on behalf of the
Collateral Agent or any other Secured Party. 
All amounts due under this Section 6.03 shall be payable on written
demand therefor.

SECTION 6.04.  Successors and Assigns.  Whenever in this Agreement any of the parties
hereto is referred to, such reference shall be deemed to include the permitted
successors and assigns of such party; and all covenants, promises and
agreements by or on behalf of any Grantor or the Collateral Agent that are
contained in this Agreement shall bind and inure to the benefit of their
respective successors and assigns.

SECTION 6.05.  Survival of Agreement.  All covenants, agreements, representations
and warranties made by the Grantors in the Noteholder Documents and in the
certificates or other instruments prepared or delivered in connection with or
pursuant to this Agreement or any other Noteholder Document shall be considered
to have been relied upon by the Secured Parties and shall survive the execution
and delivery of the Noteholder Documents and the issuance of the Securities,
regardless of any investigation made by any Secured Party or on its behalf and
notwithstanding that the Collateral Agent or any Secured Party may have had
notice or knowledge of any Default or incorrect representation or warranty at
the time any Securities are issued under the Indenture, and shall continue in
full force and effect as long as the principal of or any accrued interest on
any Securities or any fee or any other amount payable under any Noteholder
Document is outstanding and unpaid.

 29
 

 

SECTION 6.06.  Counterparts; Effectiveness; Several Agreement.  This Agreement may be executed in
counterparts, each of which shall constitute an original but all of which when
taken together shall constitute a single contract.  Delivery of an executed signature page to
this Agreement by facsimile transmission shall be as effective as delivery of a
manually signed counterpart of this Agreement. 
This Agreement shall become effective as to any Grantor when a
counterpart hereof executed on behalf of such Grantor shall have been delivered
to the Collateral Agent and a counterpart hereof shall have been executed on
behalf of the Collateral Agent, and thereafter shall be binding upon such
Grantor and the Collateral Agent and their respective permitted successors and
assigns, and shall inure to the benefit of such Grantor, the Collateral Agent
and the other Secured Parties and their respective successors and assigns,
except that no Grantor shall have the right to assign or transfer its rights or
obligations hereunder or any interest herein or in the Collateral (and any such
assignment or transfer shall be void) except as expressly contemplated by this
Agreement or the Indenture.  This
Agreement shall be construed as a separate agreement with respect to each
Grantor and may be amended, modified, supplemented, waived or released with
respect to any Grantor without the approval of any other Grantor and without
affecting the obligations of any other Grantor hereunder.  In any action or
proceeding involving any state, provincial or foreign corporate law, or any
federal, state, provincial or foreign bankruptcy, insolvency, reorganization or
other law affecting the rights of creditors generally, if the obligations of
any Grantor under this Agreement would otherwise be held or determined to be
avoidable, invalid or unenforceable on account of the amount of such Grantor’s
liability under this Agreement, then, notwithstanding any other provision of
this Agreement to the contrary, the amount of such liability shall, without any
further action by the Grantors or the Collateral Agent, be automatically
limited and reduced to the maximum amount that can be hereby incurred without
rendering such obligations avoidable, invalid or unenforceable.  The provisions set forth in the immediately
preceding sentence are intended solely to preserve the rights of the Collateral
Agent and the Secured Parties to the maximum extent not subject to avoidance
under applicable law, and no Grantor nor any other person or entity shall have
any right or claim under this Section 6.06 with respect to such maximum
liability, except to the extent necessary so that the obligations of any
Grantor hereunder shall not be rendered voidable under applicable law.  Each
Grantor agrees that the Secured Obligations may at any time and from time to
time exceed such maximum liability of each Grantor without impairing this
Agreement or affecting the rights and remedies of the Collateral Agent and the
Secured Parties hereunder, provided
that nothing in this sentence shall be construed to increase any Grantor’s
obligations hereunder beyond its maximum liability.

SECTION 6.07.  Severability.  Any provision of this Agreement held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such invalidity, illegality or unenforceability
without affecting the validity, legality and enforceability of the remaining
provisions hereof; and the invalidity of a particular provision in a particular
jurisdiction shall not invalidate such provision in any other
jurisdiction.  The parties shall endeavor
in good-faith negotiations to replace the invalid, illegal or
unenforceable provisions with valid provisions the economic effect of which
comes as close as possible to that of the invalid, illegal or unenforceable
provisions.

 30
 

 

SECTION 6.08.  [RESERVED]

SECTION 6.09.  Governing Law; Jurisdiction; Consent to Service of
Process.  (a)  This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.

(b)  Each Grantor hereby
irrevocably and unconditionally submits, for itself and its property, to the
nonexclusive jurisdiction of any U.S. Federal or New York State court sitting
in New York, New York in any action or proceeding arising out of or relating to
this Agreement, or for recognition or enforcement of any judgment, and each of
the parties hereto hereby irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined
in such New York State or, to the extent permitted by law, in such Federal
court.  Each of the parties hereto agrees
that a final judgment in any such action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.  Nothing in this
Agreement or any other Noteholder Document shall affect any right that the
Collateral Agent or any other Secured Party may otherwise have to bring any action
or proceeding relating to this Agreement or any other Noteholder Document
against any Grantor or its properties in the courts of any jurisdiction.

(c)  Each Grantor hereby
irrevocably and unconditionally waives, to the fullest extent it may legally
and effectively do so, any objection which it may now or hereafter have to the
laying of venue of any suit, action or proceeding arising out of or relating to
this Agreement or any other Noteholder Document in any court referred to in
paragraph (b) of this Section 6.09.  Each
of the parties hereto hereby irrevocably waives, to the fullest extent
permitted by law, the defense of an inconvenient forum to the maintenance of
such action or proceeding in any such court.

(d)  Each party to this Agreement
irrevocably consents to service of process in the manner provided for notices
in Section 6.01.  Nothing in this
Agreement or any other Noteholder Document will affect the right of any party
to this Agreement to serve process in any other manner permitted by law.

SECTION 6.10.  WAIVER OF JURY TRIAL. 
EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY
LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS
AGREEMENT, ANY OTHER NOTEHOLDER DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 6.10.

 31
 

 

SECTION 6.11.  Headings. 
Article and Section headings and the Table of Contents used herein are
for convenience of reference only, are not part of this Agreement and are not
to affect the construction of, or to be taken into consideration in interpreting,
this Agreement.

SECTION 6.12.  Security Interest Absolute.  All rights of the Collateral Agent hereunder,
the Security Interest, the grant of a security interest in the Pledged
Collateral and all obligations of each Grantor hereunder shall be absolute and
unconditional irrespective of (a) any lack of validity or enforceability
of the Indenture, any other Noteholder Document, any agreement with respect to
any of the Secured Obligations or any other agreement or instrument relating to
any of the foregoing, (b) any change in the time, manner or place of
payment of, or in any other term of, all or any of the Secured Obligations, or
any other amendment or waiver of or any consent to any departure from the
Indenture, any other Noteholder Document or any other agreement or instrument,
(c) any exchange, release or non-perfection of any Lien on other
collateral, or any release or amendment or waiver of or consent under or
departure from any guarantee, securing or guaranteeing all or any of the
Secured Obligations, or (d) any other circumstance that might otherwise
constitute a defense available to, or a discharge of, any Grantor in respect of
the Secured Obligations or this Agreement.

SECTION 6.13.  Termination or Release.  The termination of this Agreement, the Security
Interest and all other security interests granted hereby shall be governed by
the terms and conditions of the Indenture and the other Noteholder Documents.

SECTION 6.14.  Additional Subsidiaries.  If, pursuant to Section 4.12 of the
Indenture, the Company is required to cause any Subsidiary that is not a
Subsidiary Party to become a Subsidiary Party, upon execution and delivery by
the Collateral Agent and such Subsidiary of an instrument in the form of
Exhibit A hereto, such Subsidiary shall become a Subsidiary Party hereunder
with the same force and effect as if originally named as a Subsidiary Party
herein.  The execution and delivery of
any such instrument shall not require the consent of any other Grantor hereunder.  The rights and obligations of each Grantor
hereunder shall remain in full force and effect notwithstanding the addition of
any new Grantor as a party to this Agreement.

SECTION 6.15.  Collateral Agent Appointed Attorney-in-Fact.  Each Grantor hereby appoints the Collateral
Agent the attorney-in-fact of such Grantor for the purpose of carrying out the
provisions of this Agreement and taking any action and executing any instrument
that the Collateral Agent may deem necessary or advisable to accomplish the
purposes hereof, which appointment is irrevocable until the payment in full of
the Secured Obligations and coupled with an interest.  Without limiting the generality of the
foregoing, the Collateral Agent shall have the right, upon the occurrence and
during the continuance of an Event of Default, with full power of substitution
either in the Collateral Agent’s name or in the name of such Grantor
(a) to receive, endorse, assign and/or deliver any and all notes,
acceptances, checks, drafts, money orders or other evidences of payment relating
to the Collateral or any part thereof, (b) to demand, collect, receive
payment of, give receipt for and give discharges and releases of all or any of
the

 32
 

 

Collateral,
(c) to sign the name of any Grantor on any invoice or bill of lading
relating to any of the Collateral, (d) to send verifications of
Receivables to any Account Debtor, (e) to commence and prosecute any and
all suits, actions or proceedings at law or in equity in any court of competent
jurisdiction to collect or otherwise realize on all or any of the Collateral or
to enforce any rights in respect of any Collateral, (f) to settle,
compromise, compound, adjust or defend any actions, suits or proceedings
relating to all or any of the Collateral, (g) to notify, or to require any
Grantor to notify, Account Debtors to make payment directly to the Collateral
Agent, and (h) to use, sell, assign, transfer, pledge, make any agreement
with respect to or otherwise deal with all or any of the Collateral, and to do
all other acts and things necessary to carry out the purposes of this
Agreement, as fully and completely as though the Collateral Agent were the
absolute owner of the Collateral for all purposes, provided that nothing
herein contained shall be construed as requiring or obligating the Collateral
Agent to make any commitment or to make any inquiry as to the nature or
sufficiency of any payment received by the Collateral Agent, or to present or
file any claim or notice, or to take any action with respect to the Collateral
or any part thereof or the moneys due or to become due in respect thereof or
any property covered thereby.  The
Collateral Agent and the other Secured Parties shall be accountable only for
amounts actually received as a result of the exercise of the powers granted to
them herein, and neither they nor their officers, directors, employees or
agents shall be responsible to any Grantor for any act or failure to act
hereunder, except for their own gross negligence, bad faith or willful
misconduct.

SECTION
6.16.  Intercreditor
Agreement Governs.  

NOTWITHSTANDING
ANYTHING HEREIN TO THE CONTRARY, (A) THE LIENS AND SECURITY INTERESTS
GRANTED TO THE COLLATERAL AGENT PURSUANT TO THIS AGREEMENT ARE EXPRESSLY
SUBJECT AND SUBORDINATE TO THE LIENS AND SECURITY INTERESTS GRANTED IN FAVOR OF
THE SENIOR LENDERS (AS DEFINED IN THE INTERCREDITOR AGREEMENT REFERRED TO
BELOW), INCLUDING LIENS AND SECURITY INTERESTS GRANTED TO JPMORGAN CHASE BANK,
N.A., AS ADMINISTRATIVE AGENT, PURSUANT TO OR IN CONNECTION WITH THE CREDIT
AGREEMENT DATED AS OF FEBRUARY 2, 2006 (AS AMENDED, RESTATED, SUPPLEMENTED
OR OTHERWISE MODIFIED FROM TIME TO TIME), AMONG INDALEX HOLDINGS FINANCE, INC.,
THE “BORROWERS” NAMED THEREIN, JPMORGAN CHASE BANK, N.A., AS ADMINISTRATIVE
AGENT, THE LENDERS PARTY THERETO AND THE OTHER PARTIES PARTY THERETO, AND
(B) THE EXERCISE OF ANY RIGHT OR REMEDY BY THE COLLATERAL AGENT HEREUNDER
IS SUBJECT TO THE LIMITATIONS AND PROVISIONS OF THE INTERCREDITOR AGREEMENT
DATED AS OF FEBRUARY 2, 2006 (AS AMENDED, RESTATED, SUPPLEMENTED OR OTHERWISE
MODIFIED FROM TIME TO TIME), AMONG JPMORGAN CHASE BANK, N.A., AS INTERCREDITOR
AGENT, U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE UNDER THE INDENTURE AND AS
COLLATERAL AGENT UNDER THIS AGREEMENT, INDALEX HOLDINGS FINANCE, INC. AND ITS
SUBSIDIARIES PARTY THERETO.  IN THE EVENT
OF ANY CONFLICT BETWEEN THE TERMS OF THE INTERCREDITOR

 33
 

 

AGREEMENT
AND THE TERMS OF THIS AGREEMENT, THE TERMS OF THE INTERCREDITOR AGREEMENT SHALL
GOVERN.

 34
 

 

IN WITNESS
WHEREOF, the parties hereto have duly executed this Agreement as of the day and
year first above written.

	
  

  	
   

  	
  INDALEX HOLDINGS FINANCE, INC.,

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  /s/ Michael E. Alger

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Michael E. Alger

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Executive Vice President,
    Secretary, Treasurer and Chief   Financial Officer

  

 

	
  

  	
   

  	
  INDALEX HOLDING CORP.,

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  /s/ Michael E. Alger

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Michael E. Alger

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Executive Vice President,
    Secretary, Treasurer and Chief   Financial Officer

  

 

	
  

  	
   

  	
  INDALEX, INC.,

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  /s/ Michael E. Alger

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Michael E. Alger

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Executive Vice President,
    Secretary, Treasurer and Chief   Financial Officer

  

 

	
  

  	
   

  	
  CARADON LEBANON INC.,

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  /s/ Michael E. Alger

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Michael E. Alger

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Executive Vice President,
    Secretary, Treasurer and Chief   Financial Officer

  

 

	
  

  	
   

  	
  DOLTON ALUMINUM COMPANY, INC.,

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  /s/ Michael E. Alger

  
	
   

  	
   

  	
   

  	
   

  	
  Name: Michael E. Alger

  
	
   

  	
   

  	
   

  	
   

  	
  Title: Executive Vice President,
    Secretary, Treasurer and Chief   Financial Officer

  

 

 35
 

 

 

	
  

  	
   

  	
  U.S. BANK NATIONAL ASSOCIATION,

  AS COLLATERAL AGENT,

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
    /s/ Raymond S. Haverstock

  
	
   

  	
   

  	
   

  	
   

  	
    Name: Raymond S. Haverstock

  
	
   

  	
   

  	
   

  	
   

  	
    Title: Vice President

  

 

 36

Schedule I to

the Security
Agreement

SUBSIDIARY
PARTIES

 

Schedule II to

the Security
Agreement

EQUITY INTERESTS

 

 

 

DEBT SECURITIES

 

 

Schedule III to

the Security
Agreement

 

INTELLECTUAL
PROPERTY

 

Schedule IV to

the Security
Agreement

COMMERCIAL TORT
CLAIMS

Exhibit A to the

Security Agreement

SUPPLEMENT NO.      dated as of [·]
(this “Supplement”), to the Security Agreement dated as of
February 2, 2006 (the “Security Agreement”), among INDALEX HOLDINGS
FINANCE, INC., a Delaware corporation (“Parent”), INDALEX HOLDING CORP., a Delaware corporation and
a wholly owned subsidiary of Parent (the “Company”), each subsidiary of the Company listed on Schedule
I thereto (each such subsidiary individually a “Subsidiary Party” and collectively, the “Subsidiary Parties”; the
Subsidiary Grantors, Parent and the Company are referred to collectively herein
as the “Grantors”) and
U.S. BANK NATIONAL ASSOCIATION, a national banking association corporation, as
Collateral Agent (in such capacity, the “Collateral Agent”).

A.  Reference is
made to the Indenture dated as of February 2, 2006 (as amended, restated,
supplemented or otherwise modified from time to time, the “Indenture”),
among Parent, the Company, the Subsidiary Parties and U.S. Bank National
Association, as Trustee.

B.  Capitalized
terms used herein and not otherwise defined herein shall have the meanings
assigned to such terms in the Indenture and the Security Agreement.

C.  The Grantors
have entered into the Security Agreement in order to induce the Trustee to
enter into the Indenture and the Initial Purchasers to purchase the
Securities.  Section 6.14 of
Security Agreement provides that additional Subsidiaries of the Company may
become Subsidiary Parties under the Security Agreement by execution and
delivery of an instrument in the form of this Supplement.  The undersigned Subsidiary (the “New
Subsidiary”) is executing this Supplement in accordance with the
requirements of the Indenture to become a Subsidiary Party under the Security
Agreement as consideration for credit previously extended to the Company.

Accordingly,
the Collateral Agent and the New Subsidiary agree as follows:

SECTION 1.  In
accordance with Section 6.14 of the Security Agreement, the New Subsidiary
by its signature below becomes a Subsidiary Party and Grantor under the
Security Agreement with the same force and effect as if originally named
therein as a Subsidiary Party, and the New Subsidiary hereby (a) agrees to all
the terms and provisions of the Security Agreement applicable to it as a
Subsidiary Party and Grantor thereunder and (b) represents and warrants
that the representations and warranties made by it as a Grantor thereunder are
true and correct on and as of the date hereof. 
In furtherance of the foregoing, the New Subsidiary, as security for the
payment and performance in full of the Secured Obligations, does hereby create
and grant to the Collateral Agent, its successors and assigns, for the benefit
of the Secured Parties, their successors and assigns, a security interest in
and lien on all of the New Subsidiary’s right,

 

title and interest in and
to the Collateral of the New Subsidiary. 
Each reference to a “Grantor” in the Security Agreement shall be deemed
to include the New Subsidiary.  The
Security Agreement is hereby incorporated herein by reference.

SECTION 2.  The
New Subsidiary represents and warrants to the Collateral Agent and the other
Secured Parties that this Supplement has been duly authorized, executed and
delivered by it and constitutes its legal, valid and binding obligation, enforceable
against it in accordance with its terms.

SECTION 3.  This
Supplement may be executed in counterparts (and by different parties hereto on
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract.  This Supplement shall become effective when
the Collateral Agent shall have received a counterpart of this Supplement that
bears the signature of the New Subsidiary and the Collateral Agent has executed
a counterpart hereof.  Delivery of an
executed signature page to this Supplement by facsimile transmission shall be
as effective as delivery of a manually signed counterpart of this Supplement.

SECTION 4.  The
New Subsidiary hereby represents and warrants that (a) set forth on
Schedule I attached hereto is a true and correct schedule of the location
of any and all Collateral of the New Subsidiary, (b) set forth on
Schedule II attached hereto is a true and correct schedule of all the
Pledged Securities of the New Subsidiary, (c) set forth on
Schedule III attached hereto is a true and correct schedule of all
Intellectual Property of the New Subsidiary and (d) set forth under its
signature hereto, is the true and correct legal name of the New Subsidiary, its
jurisdiction of formation and the location of its chief executive office.

SECTION 5. 
Except as expressly supplemented hereby, the Security Agreement shall
remain in full force and effect.

SECTION 6. 
THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK.

SECTION 7.  In
case any one or more of the provisions contained in this Supplement should be
held invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein and in the
Security Agreement shall not in any way be affected or impaired thereby (it
being understood that the invalidity of a particular provision in a particular
jurisdiction shall not in and of itself affect the validity of such provision in
any other jurisdiction). The parties hereto shall endeavor in good-faith
negotiations to replace the invalid, illegal or unenforceable provisions with
valid provisions the economic effect of which comes as close as possible to
that of the invalid, illegal or unenforceable provisions.

SECTION 8.  All
communications and notices hereunder shall be in writing and given as provided
in Section 6.01 of the Security Agreement.

 2
 

 

SECTION 9.  The
New Subsidiary agrees to reimburse the Collateral Agent for its reasonable
out-of-pocket expenses in connection with this Supplement, including the
reasonable fees, other charges and disbursements of counsel for the Collateral
Agent.

IN
WITNESS WHEREOF, the New Subsidiary and the Collateral Agent have duly executed
this Supplement to the Security Agreement as of the day and year first above
written.

	
  

  	
  [NAME OF NEW SUBSIDIARY],

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Legal Name:

  
	
   

  	
   

  	
  Jurisdiction of
  Formation:

  
	
   

  	
   

  	
  Location of Chief
  Executive office:

  

 

 

	
  

  	
  U.S. BANK NATIONAL ASSOCIATION,

  AS COLLATERAL AGENT,

  
	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 3

Schedule I

to the Supplement No.     
to the

Security Agreement

LOCATION OF
COLLATERAL

 

 

Schedule II

to the Supplement No.     
to the

Security Agreement

PLEDGED SECURITIES

 

 

Schedule III

to the Supplement No.     
to the

Security Agreement

INTELLECTUAL
PROPERTY

 

Exhibit B

to the Security
Agreement

[PERFECTION
CERTIFICATE]Exhibit
4.5

EXECUTION COPY

INTERCREDITOR AGREEMENT dated as of
February 2, 2006, among JPMORGAN CHASE BANK, N.A. (“JPMCB”),
as the Intercreditor Agent (as defined in Section 1 below), U.S. BANK
NATIONAL ASSOCIATION,
as the Trustee (as defined in Section 1 below), INDALEX HOLDINGS
FINANCE, INC., a Delaware corporation (the “Company”),
and each Subsidiary listed on Schedule I hereto.

A.  The Company and certain Subsidiaries (such
term and each other capitalized term used herein and not heretofore defined
having the meanings set forth in Section 1 below) have entered into the Credit
Agreement dated as of February 2, 2006 (the “Credit
Agreement”), with the lenders party thereto and JPMCB, as
administrative agent;

B.  The Obligations of the Company and the Subsidiaries
under the Credit Agreement are secured on a first-priority basis by various
assets of the Company and certain Subsidiaries;

C.  The Issuer, the Company, certain other
Subsidiaries and the Trustee have entered into the Indenture dated as of
February 2, 2006 (the “Indenture”),
pursuant to which the Notes shall be issued and governed;

D.  The Obligations of the Issuer, the Company
and certain other Subsidiaries under the Indenture and the Notes are secured on
a second-priority basis by various assets of the Company and certain
Subsidiaries;

E.  The Issuer, the Company, certain other
Subsidiaries, the Intercreditor Agent and the Trustee are entering into this
Agreement to set forth, among other things, certain rights and priorities with
respect to the Senior Lender Collateral and the Noteholder Collateral;

Accordingly, in
consideration of the foregoing, the mutual covenants and obligations herein set
forth and for other good and valuable consideration, the sufficiency and
receipt of which are hereby acknowledged, the parties hereto, intending to be
legally bound, hereby agree as follows:

Section 1.         Definitions.

1.1           Defined Terms.  As used in this Agreement, the following
terms have the meanings specified below:

“Agreement”
shall mean this Agreement.

“Bankruptcy Law” shall mean Title 11 of the
United States Code and any similar Federal, state or foreign law for the relief
of debtors.

“Business Day” shall mean any day other than a
Saturday, a Sunday or a day that is a legal holiday under the laws of the State
of New York or on which banking institutions in the State of New York are
required or authorized by law or other governmental action to close.

“Cash
Management Obligations” shall mean, with respect to any Person,
any and all obligations of such Person, whether absolute or contingent and
howsoever and whensoever created, arising, evidenced or acquired (including all
renewals, extensions and modifications thereof and substitutions therefor) in
connection with each and any of the following bank services provided to such
Person: (a) commercial credit cards, (b) stored value cards and (c) treasury
management services (including controlled disbursement, currency, automated
clearinghouse transactions, return items, overdrafts and interstate depository
network services).

“Common Collateral” shall mean all of the
assets of any Grantor, whether real, personal or mixed, constituting both
Senior Lender Collateral and Noteholder Collateral.

“Company”
shall have the meaning set forth in the preamble.

“Comparable Noteholder Collateral Document”
shall mean, in relation to any Common Collateral subject to any Lien created
under any Senior Collateral Document, that Noteholder Collateral Document that
creates a Lien on the same Common Collateral, granted by the same Grantor.

“Credit
Agreement” shall have the meaning set forth in the recitals.

“Deposit
Account” shall have the meaning set forth in the Uniform
Commercial Code.

“Deposit
Account Collateral” shall mean that part of the Common
Collateral comprised of or contained in Deposit Accounts or Securities
Accounts.

“DIP
Financing” shall have the meaning set forth in Section 6.1.

“Discharge of Senior Lender Claims” shall
mean, subject to Section 5.6,
payment in full in cash (or, to the extent acceptable to each Senior Lender,
cash equivalents or other consideration) of (a) all principal, interest and
other Senior Lender Claims under the Senior Credit Agreement (or, with respect
to letters of credit or letter of credit guaranties outstanding thereunder,
either termination thereof or delivery of cash collateral or backstop letters
of credit in respect thereof in compliance with the Senior Credit Agreement),
in each case after or concurrently with the termination of all commitments to
extend credit thereunder (other than any commitment to satisfy drawings under
any outstanding letter of credit or letter of credit guaranties in accordance
with the terms thereof), and (b) all other Senior Lender Claims that are due
and payable or otherwise accrued and owing at or prior to the time such principal
and interest are paid, in each case, other than contingent indemnities and
costs and reimbursement obligations to the extent no claim has been made.

“Domestic
Subsidiary” shall mean any Subsidiary that is organized under
the laws of the United States of America, any State thereof or the District of
Columbia.

“Grantors”
shall mean the Company and each of the Domestic Subsidiaries that has executed
and delivered a Noteholder Collateral Document or a Senior Collateral Document.

“Incur”
shall have the meaning set forth in the Indenture.

 2
 

“Indebtedness” shall mean and include all
obligations that constitute “Indebtedness” within the meaning of the Senior
Credit Agreement or the Indenture.

“Indenture” shall have the meaning set forth
in the recitals.

“Insolvency or Liquidation Proceeding” shall
mean (a) any voluntary or involuntary case or proceeding under any Bankruptcy
Law with respect to any Grantor, (b) any other voluntary or involuntary
insolvency, reorganization or bankruptcy case or proceeding, or any
receivership, liquidation, reorganization or other similar case or proceeding
with respect to any Grantor or with respect to any of its assets, (c) any
liquidation, dissolution, reorganization or winding up of any Grantor whether
voluntary or involuntary and whether or not involving insolvency or bankruptcy
or (d) any assignment for the benefit of creditors or any other marshalling of
assets and liabilities of any Grantor.

“Intellectual
Property” shall have the meaning assigned to such term in the
Senior Collateral Documents and the Noteholder Collateral Documents.

“Intercreditor
Agent” shall mean JPMCB, in its capacity as administrative agent
for the Senior Lenders under the Senior Credit Agreement, and any successor
thereto in such capacity (including, if there is more than one Senior Credit
Agreement, such agent, representative or trustee as is designated “Intercreditor
Agent” by Senior Lenders holding a majority of the aggregate amount of the
Senior Lender Claims then outstanding).

“Issuer”
shall mean Indalex Holding Corp., a Delaware corporation.

“Lien”
shall mean, with respect to any asset, (a) any mortgage, deed of trust,
lien, pledge, hypothecation, encumbrance, charge or security interest in, on or
of such asset, (b) the interest of a vendor or a lessor under any
conditional sale agreement, capital lease or title retention agreement (or any
financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities owned
by the applicable Person, any purchase option, call or similar right of a third
party with respect to such securities.

“Noteholder Claims” shall mean all Obligations
in respect of the Notes or arising under the Noteholder Documents or any of
them, including all fees and expenses of the Trustee thereunder.

“Noteholder Collateral” shall mean all of the
assets of any Grantor, whether real, personal or mixed, with respect to which a
Lien is granted or purported to be granted as security for any Noteholder
Claim.

“Noteholder Collateral Documents” shall mean
the Noteholder Security Agreement and all other agreements, documents and
instruments pursuant to which a Lien is now or hereafter granted (or purported
to be granted) by any Grantor to secure any Noteholder Claims or under which
rights or remedies with respect to any such Lien are governed.

“Noteholder
Documents” shall mean (a) the Indenture, the Notes, the
Noteholder Collateral Documents and (b) any other related document or
instrument executed and delivered pursuant to any Noteholder Document described
in clause (a) above evidencing or governing any

 3
 

Obligations
thereunder.

“Noteholder
Security Agreement” shall mean the Security Agreement dated as
of February 2, 2006, among the Company, the Issuer, certain other Grantors
and the Trustee.

“Noteholders”
shall mean, collectively, each Person that holds, or is an obligee in respect
of, any Noteholder Claim.

“Notes”
shall mean (a) the 111⁄2% Second-Priority Senior Secured Notes due 2014 to
be issued by the Issuer pursuant to the Indenture, (b) the exchange notes
issued in exchange therefor as contemplated by the Registration Rights
Agreement dated as of February 2, 2006, among the Company, the Issuer, the
other Subsidiaries listed therein and the initial purchasers party thereto and
(c) any additional notes issued under the Indenture by the Issuer, to the
extent permitted by the Indenture and the Senior Credit Agreement.

“Obligations” shall mean any and all
obligations, whether now owing or hereafter arising, with respect to the payment
of (a) any principal of or interest or premium on any Indebtedness,
including any reimbursement obligation in respect of any letter of credit or
letter of credit guaranty, (b) any fees, penalties, indemnification
obligations, expense reimbursement obligations or other liabilities payable
under the documentation governing such Indebtedness and (c) any obligation
to post cash collateral in respect of letters of credit, letter of credit
guaranties or any other obligations.

“Officers’
Certificate” shall have the meaning set forth in the Indenture.

“Pari
Passu Lien Obligation” shall have the meaning set forth in the
Indenture.

“Person”
shall mean any natural person, corporation, limited liability company, trust,
joint venture, association, company, partnership, entity or other party,
including any government and any political subdivision, agency or
instrumentality thereof.

“Pledged or Controlled Collateral” shall have
the meaning set forth in Section 5.5.

“Recovery” shall have the meaning set forth in
Section 6.4.

“Refinance”
shall mean, in respect of any Indebtedness, to refinance, extend, renew,
refund, repay, prepay, purchase, redeem, defease or retire, or to issue other
Indebtedness in exchange or replacement for, such Indebtedness. “Refinanced” and “Refinancing” shall have correlative
meanings.

“Refinancing
Noteholder Claims” shall mean any Obligations that Refinance any
Noteholder Claims and that are permitted by the Senior Credit Agreement.

“Required Lenders” shall mean, with respect to
any Senior Credit Agreement, those Senior Lenders the approval of which is
required to approve an amendment or modification of, termination or waiver of
any provision of or consent to any departure from such Senior Credit Agreement
(or would be required to effect such consent under this Agreement if such
consent

 4
 

were treated as an
amendment of the Senior Credit Agreement).

“Securities
Account” shall have the meaning set forth in the Uniform
Commercial Code.

“Senior
Collateral Documents” shall mean the Senior Security Agreement
and all other agreements, documents and instruments pursuant to which a Lien is
now or hereafter granted (or purported to be granted) by any Grantor to secure
any Senior Lender Claims or under which rights or remedies with respect to any
such Lien are governed.

“Senior
Credit Agreement” shall mean the Credit Agreement, together with
the related documents thereto (including any term loans and revolving loans
thereunder, any guarantees and the Senior Collateral Documents), as amended,
extended, renewed, restated, supplemented or otherwise modified (in whole or in
part, and without limitation as to amount, terms, conditions, covenants and
other provisions) from time to time, and any agreement (and related document)
governing Indebtedness Incurred to Refinance (including one or more debt
facilities, receivables financing facilities or commercial paper facilities or
indentures with banks or other institutional lenders or a trustee providing for
revolving credit loans, term loans, receivables financing (including through
the sale of receivables to such lenders or to special purpose entities formed
to borrow from such lenders against such receivables) or letters of credit or
issuance of debt securities to institutional investors), in whole or in part,
the borrowings and commitments then outstanding or permitted to be outstanding
under such Senior Credit Agreement or a successor Senior Credit Agreement,
whether by the same or any other lender or group of lenders.

“Senior Lender Cash Management
Obligations” shall mean any Cash Management Obligations
secured by any Common Collateral under the Senior Credit Agreement.

“Senior Lender Claims” shall mean (a) all
Indebtedness of the Issuer, the Company and the other Grantors Incurred under
the provisions described under clause (b)(1) of Section 4.03 of the
Indenture, (b) all other Obligations (not constituting Indebtedness) of
the Issuer, the Company and the other Grantors under the Senior Credit
Agreement and (c) all other Obligations of the Issuer, the Company and the
other Grantors in respect of Senior Lender Cash Management Obligations or
Senior Lender Swap Obligations.  Senior
Lender Claims shall include all interest and expenses accrued or accruing (or
that would, absent the commencement of an Insolvency or Liquidation Proceeding,
accrue) after the commencement of an Insolvency or Liquidation Proceeding in
accordance with and at the rate specified in the relevant Senior Lender
Document, whether or not the claim for such interest or expenses is allowed or
allowable as a claim in such Insolvency or Liquidation Proceeding.

“Senior Lender Collateral” shall mean all of
the assets of any Grantor, whether real, personal or mixed, with respect to
which a Lien is granted or purported to be granted as security for any Senior Lender
Claim.

“Senior Lender Documents” shall mean the
Senior Credit Agreement and each agreement, document or instrument providing
for or evidencing a Senior Lender Cash

 5
 

Management
Obligation or Senior Lender Swap Obligation.

“Senior Lender Swap Obligations” shall mean
any Swap Obligations secured by any Common Collateral under the Senior Credit
Agreement.

“Senior Lenders” shall mean, collectively,
each Person that holds, or is an obligee in respect of, any Senior Lender
Claim, including the Intercreditor Agent.

“Senior Security Agreement” shall mean the
Domestic Security Agreement dated as of February 2, 2006, among the
Issuer, the Company, each other Grantor and the Intercreditor Agent.

“subsidiary”
shall have the meaning assigned to such term in the Credit Agreement, as in
effect on the date hereof.

“Subsidiary”
shall mean any subsidiary of the Company.

“Swap Agreement” shall mean, with respect to
any Person, any agreement with respect to any swap, forward, future or
derivative transaction or option or similar agreement involving, or settled by
reference to, one or more rates, currencies, commodities, equity or debt
instruments or securities, or economic, financial or pricing indices or
measures of economic, financial or pricing risk or value or any similar
transaction or any combination of these transactions, provided
that no phantom stock or similar plan providing for payments only on account of
services provided by current or former directors, officers, employees or
consultants of such Person shall be a Swap Agreement.

“Swap Obligations” shall mean, with respect to
any Person, any and all obligations of such Person, whether absolute or
contingent and howsoever and whensoever created, arising, evidenced or acquired
(including all renewals, extensions and modifications thereof and substitutions
therefor), under (a) any and all Swap Agreements and (b) any and all
cancelations, buy backs, reversals, terminations or assignments of any Swap
Agreement transaction.

“Trustee”
shall mean U.S. Bank National Association, in its capacity as trustee under the
Indenture and collateral agent under the Noteholder Collateral Documents, and
its successors in such capacities.

“Uniform Commercial Code” or “UCC”
shall mean the Uniform Commercial Code as from time to time in effect in the
State of New York or, for purposes of Sections 2.1 and 3.1(a), any other
applicable State.

1.2           Terms Generally.  The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun
shall include the corresponding masculine, feminine and neuter forms.  The words “include,” “includes” and “including”
shall be deemed to be followed by the phrase “without limitation.”  The word “will” shall be construed to have
the same meaning and effect as the word “shall.”  Unless the context requires otherwise (a) any
definition of or reference to any agreement, instrument or other document
herein shall be construed as referring to such

 6
 

agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified in accordance with this Agreement, (b) any
reference herein to any Person shall be construed to include such Person’s
successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and
words of similar import, shall be construed to refer to this Agreement in its
entirety and not to any particular provision hereof, (d) all references herein
to Sections shall be construed to refer to Sections of this Agreement, (e) the
words “asset” and “property” shall be construed to have the same meaning and
effect and to refer to any and all tangible and intangible assets and
properties, including cash, securities, accounts and contract rights and (f)
any reference to any statute, law, rule, regulation, order, or other
requirement of law shall, unless otherwise specified, refer to such requirement
of law as in effect from time to time.

Section
2.         Lien Priorities.

2.1           Subordination.  Notwithstanding the date, time, manner or
order of filing or recordation of any document or instrument or grant,
attachment or perfection of any Liens granted to the Trustee or the Noteholders
on the Common Collateral or of any Liens granted to the Intercreditor Agent or
the Senior Lenders on the Common Collateral (or any actual or alleged defect in
any of the foregoing) and notwithstanding any provision of the UCC, any
applicable law, any Noteholder Document or any Senior Lender Document or any
other circumstance whatsoever, the Trustee, on behalf of itself and each Noteholder,
hereby agrees that (a) any Lien on the Common Collateral securing any Senior
Lender Claims now or hereafter held by or on behalf of the Intercreditor Agent
or any Senior Lender or any agent or trustee therefor, regardless of how
acquired, whether by grant, statute, operation of law, subrogation or
otherwise, shall have priority over and be senior in all respects and prior to
any Lien on the Common Collateral securing any Noteholder Claims and (b) any
Lien on the Common Collateral securing any Noteholder Claims now or hereafter
held by or on behalf of the Trustee or any Noteholder or any agent or trustee
therefor, regardless of how acquired, whether by grant, statute, operation of
law, subrogation or otherwise, shall be junior and subordinate in all respects
to all Liens on the Common Collateral securing any Senior Lender Claims.  All Liens on the Common Collateral securing
any Senior Lender Claims shall be and remain senior in all respects and prior
to all Liens on the Common Collateral securing any Noteholder Claims for all
purposes, whether or not such Liens securing any Senior Lender Claims are
subordinated to any Lien securing any other obligation of the Company, any
Subsidiary or any other Person or otherwise subordinated, voided, avoided,
invalidated or lapsed.

2.2           Nature
of Senior Lender Claims. 
The Trustee, on behalf of itself and each Noteholder, acknowledges that
(a) a portion of the Senior Lender Claims is revolving in nature and that the
amount thereof that may be outstanding at any time or from time to time may be
increased or reduced and subsequently reborrowed, (b) the terms of the Senior
Lender Claims may be amended, supplemented or otherwise modified, and the
Senior Lender Claims, or a portion thereof, may, subject to the limitations set
forth in the Indenture, be Refinanced, from time to time and (c) the aggregate
amount of the Senior Lender Claims may be increased, in each case, without
notice to or consent by the Trustee or the Noteholders and without affecting
the provisions hereof.  The Lien
priorities provided for in Section 2.1 shall not be altered or otherwise
affected by any amendment, supplement or other modification, or any
Refinancing, of either the Senior Lender Claims or the Noteholder Claims, or
any portion thereof.

 7
 

2.3           Prohibition on Contesting Liens.  Each of the Trustee, for itself and on behalf
of each Noteholder, and the Intercreditor Agent, for itself and on behalf of
each Senior Lender, agrees that it shall not (and hereby waives any right to)
contest or support any other Person in contesting, in any proceeding (including
any Insolvency or Liquidation Proceeding), the validity, extent, perfection,
priority or enforceability of (a) any Lien securing any Senior Lender
Claims held (or purported to be held) by or on behalf of the Intercreditor
Agent or any of the Senior Lenders or any agent or trustee therefor in any
Senior Lender Collateral or (b) any Lien securing any Noteholder Claims
held (or purported to be held) by or on behalf of the Trustee or any of the
Noteholders in the Noteholder Collateral, as the case may be; provided, however,
that nothing in this Agreement shall be construed to prevent or impair the
rights of the Intercreditor Agent or any Senior Lender to enforce this
Agreement (including the priority of the Liens securing the Senior Lender
Claims as provided in Section 2.1) or any of the Senior Lender Documents.

2.4           No New Liens.  The parties hereto agree that, so long as the
Discharge of Senior Lender Claims has not occurred (a) none of the Grantors
shall (i) grant or permit any additional Liens on any asset or property of
any Grantor to secure any Noteholder Claim unless it has granted, or
concurrently therewith grants, a Lien on such asset or property of such Grantor
to secure the Senior Lender Claims or (ii) subject to Section 11.01(b) of
the Indenture and other than with respect to any Grantor (other than the
Company and the Issuer) that is not a Note Guarantor (as defined in the
Indenture), grant or permit any additional Liens on any asset or property to secure
any Senior Lender Claims unless it has granted, or concurrently therewith
grants, a Lien on such asset to secure the Noteholder Claims, with each such
Lien to be subject to the provisions of this Agreement; and (b) if the Trustee
or any Noteholder shall hold any Lien on any assets or property of any Grantor
securing any Noteholder Claims that are not also subject to the first-priority
Lien securing Senior Lender Claims under the Senior Lender Documents, the
Trustee or the applicable Noteholder (i) shall notify the Intercreditor
Agent promptly upon becoming aware thereof and, unless such Grantor shall
promptly grant a similar Lien on such assets or property to the Intercreditor
Agent as security for the Senior Lender Claims, shall assign such Lien to the
Intercreditor Agent as security for the Senior Lender Claims (but may retain a
junior lien on such assets or property subject to the terms hereof) and (ii)
until such assignment or such grant of a similar Lien to the Intercreditor
Agent, shall be deemed to hold and have held such Lien for the benefit of the
Intercreditor Agent as security for the Senior Lender Claims.

2.5           Perfection
of Liens.  Except
for the agreements of the Intercreditor Agent pursuant to Section 5.5
hereof, neither the Intercreditor Agent nor the Senior Lenders shall be
responsible for perfecting and maintaining the perfection of Liens with respect
to the Common Collateral for the benefit of the Trustee and the
Noteholders.  The provisions of this Agreement
are intended solely to govern the respective Lien priorities as between the
Senior Lenders and the Noteholders and shall not impose on the Intercreditor
Agent, the Senior Lenders, the Trustee, the Noteholders or any agent or trustee
therefor any obligations in respect of the disposition of proceeds of any
Common Collateral which would conflict with prior perfected claims therein in
favor of any other Person or any order or decree of any court or governmental
authority or any applicable law.

 8
 

Section 3.         Enforcement.

3.1           Exercise
of Remedies.  

(a)           So
long as the Discharge of Senior Lender Claims has not occurred, whether or not
any Insolvency or Liquidation Proceeding has been commenced by or against the
Company or any other Grantor, (i) neither the Trustee nor any Noteholder
will (x) exercise or seek to exercise any rights or remedies (including
setoff) with respect to any Common Collateral in respect of any Noteholder
Claims, or institute any action or proceeding with respect to such rights or
remedies (including any action of foreclosure), (y) contest, protest or
object to any foreclosure proceeding or action brought with respect to the
Common Collateral or any other Senior Lender Collateral by the Intercreditor
Agent or any Senior Lender in respect of the Senior Lender Claims, the exercise
of any right by the Intercreditor Agent or any Senior Lender (or any agent or
sub-agent on their behalf) in respect of the Senior Lender Claims under any
lockbox agreement, control agreement, landlord waiver or bailee’s letter or
similar agreement or arrangement to which the Intercreditor Agent or any Senior
Lender either is a party or may have rights as a third party beneficiary, or
any other exercise by any such party of any rights and remedies relating to the
Common Collateral under the Senior Lender Documents or otherwise in respect of
the Senior Lender Collateral or the Senior Lender Claims, or (z) object to
the forbearance by the Senior Lenders from bringing or pursuing any foreclosure
proceeding or action or any other exercise of any rights or remedies relating
to the Common Collateral in respect of Senior Lender Claims and
(ii) except as otherwise provided herein, the Intercreditor Agent and the
Senior Lenders shall have the exclusive right to enforce rights, exercise
remedies (including setoff and the right to credit bid their debt) and make
determinations regarding the release, disposition or restrictions with respect
to the Common Collateral without any consultation with or the consent of the
Trustee or any Noteholder; provided, however, that
(A) in any Insolvency or Liquidation Proceeding commenced by or against
the Company or any other Grantor, the Trustee may file a claim or statement of
interest with respect to the Noteholder Claims, (B) the Trustee may take
any action (not adverse to the prior Liens on the Common Collateral securing
the Senior Lender Claims or the rights of the Intercreditor Agent or the Senior
Lenders to exercise remedies in respect thereof) in order to create, prove,
perfect, preserve or protect (but not enforce) its rights in, and perfection
and priority of its Lien on, the Common Collateral, (C) the Trustee and
the Noteholders may exercise their rights and remedies as unsecured creditors,
as provided in Section 5.4, and (D) the Trustee may exercise the rights
and remedies provided for in Section 6.3. 
In exercising rights and remedies with respect to the Senior Lender
Collateral, the Intercreditor Agent and the Senior Lenders may enforce the
provisions of the Senior Lender Documents and exercise remedies thereunder, all
in such order and in such manner as they may determine in the exercise of their
sole discretion.  Such exercise and
enforcement shall include the rights of an agent appointed by them to sell or
otherwise dispose of Common Collateral upon foreclosure, to incur expenses in
connection with such sale or disposition and to exercise all the rights and
remedies of a secured lender under the Uniform Commercial Code of any
applicable jurisdiction and of a secured creditor under Bankruptcy Laws of any
applicable jurisdiction.

(b)           So
long as the Discharge of Senior Lender Claims has not occurred, the Trustee, on
behalf of itself and each Noteholder, agrees that it will not, in the context
of its role as secured creditor, take or receive any Common Collateral or any
proceeds of Common

 9
 

Collateral in connection with the exercise of any right or remedy
(including setoff) with respect to any Common Collateral in respect of
Noteholder Claims.  Without limiting the
generality of the foregoing, unless and until the Discharge of Senior Lender
Claims has occurred, except as expressly provided in the proviso in clause (ii)
of Section 3.1(a), the sole right of the Trustee and the Noteholders with
respect to the Common Collateral is to hold a Lien on the Common Collateral in
respect of Noteholder Claims pursuant to the Noteholder Documents for the
period and to the extent granted therein and to receive a share of the proceeds
thereof, if any, after the Discharge of the Senior Lender Claims has occurred.

(c)           Subject
to the proviso in clause (ii) of Section 3.1(a), (i) the Trustee, for
itself and on behalf of each Noteholder, agrees that neither the Trustee nor
any Noteholder will take any action that would hinder any exercise of remedies
undertaken by the Intercreditor Agent or the Senior Lenders with respect to the
Common Collateral under the Senior Lender Documents, including any sale, lease,
exchange, transfer or other disposition of the Common Collateral, whether by
foreclosure or otherwise, and (ii) the Trustee, for itself and on behalf of
each Noteholder, hereby waives any and all rights it or any Noteholder may have
as a junior lien creditor or otherwise to object to the manner in which the
Intercreditor Agent or the Senior Lenders seek to enforce or collect the Senior
Lender Claims or the Liens granted on any of the Senior Lender Collateral,
regardless of whether any action or failure to act by or on behalf of the
Intercreditor Agent or any other Senior Lender is adverse to the interests of
the Noteholders.

(d)           The
Trustee
hereby acknowledges and agrees that no covenant, agreement or restriction
contained in any Noteholder Document shall be deemed to restrict in any way the
rights and remedies of the Intercreditor Agent or the Senior Lenders with
respect to the Senior Lender Collateral as set forth in this Agreement and the
Senior Lender Documents.

3.2           Cooperation.  Subject to the proviso in clause (ii) of Section
3.1(a), the Trustee, on behalf of itself and each
Noteholder, agrees that, unless and until the Discharge of Senior Lender Claims
has occurred, it will not commence, or join with any Person (other than the
Senior Lenders and the Intercreditor Agent upon the request thereof) in
commencing, any enforcement, collection, execution, levy or foreclosure action
or proceeding with respect to any Lien held by it in the Common Collateral
under any of the Noteholder Documents or otherwise in respect of the Noteholder
Claims.

3.3           Actions upon Breach.  Should the Trustee or any Noteholder,
contrary to this Agreement, in any way take, attempt to take or threaten to
take any action with respect to the Common Collateral (including any attempt to
realize upon or enforce any remedy with respect to this Agreement) or fail to
take any action required by this Agreement, the Intercreditor Agent or any
other Senior Lender (in its or their own name or in the name of the Company or
any other Grantor) or the Company may obtain relief against the Trustee or such
Noteholder by injunction, specific performance or other appropriate equitable
relief.  The Trustee, on behalf of itself
and each Noteholder, hereby (i) agrees that the Senior Lenders’ damages from
the actions of the Trustee or any Noteholder may at that time be difficult to
ascertain and may be irreparable and waives any defense that the Company, any
other Grantor or the Senior Lenders cannot demonstrate damage or be made whole
by the awarding of damages and (ii) irrevocably waives any defense based on the
adequacy of a remedy at law and any other defense that might be asserted to bar
the remedy of specific performance in any action that may be brought by the

 10
 

Intercreditor Agent.

Section 4.         Payments.

4.1           Application of Proceeds.  After an event of default under any Senior
Credit Agreement has occurred and until such event of default is cured or waived,
so long as the Discharge of Senior Lender Claims has not occurred, the Common
Collateral or proceeds thereof received in connection with the sale or other
disposition of, or collection on, such Common Collateral upon the exercise of
remedies shall be applied by the Intercreditor Agent to the Senior Lender
Claims in such order as specified in the relevant Senior Lender Documents until
the Discharge of Senior Lender Claims has occurred.  Upon the Discharge of the Senior Lender
Claims, the Intercreditor Agent shall deliver promptly to the Trustee any
Common Collateral or proceeds thereof held by it in the same form as received,
with any necessary endorsements, or as a court of competent jurisdiction may
otherwise direct, to be applied by the Trustee to the Noteholder Claims in such
order as specified in the relevant Noteholder Documents.

4.2           Payments Over.  Any Common Collateral or
proceeds thereof received by the Trustee or any Noteholder in connection with
the exercise of any right or remedy (including setoff) relating to the Common
Collateral in contravention of this Agreement shall be segregated and held in
trust for the benefit of and forthwith paid over to the Intercreditor Agent for
the benefit of the Senior Lenders in the same form as received, with any
necessary endorsements, or as a court of competent jurisdiction may otherwise
direct.  The Intercreditor Agent is
hereby authorized to make any such endorsements as agent for the Trustee or any
such Noteholder.  This authorization is
coupled with an interest and is irrevocable.

 11
 

Section 5.         Other Agreements.

5.1           Releases.

(a)           Trustee,
for itself and on behalf of each Noteholder, agrees that, in the event of a
sale, transfer or other disposition of any specified item of Common Collateral
(including all or substantially all of the equity interests of any subsidiary
of the Issuer), the Liens granted to the Trustee upon such Common Collateral to
secure Noteholder Claims shall terminate and be released, automatically and
without any further action, concurrently with the termination and release of
(i) all Liens granted upon such Common Collateral to secure Senior Lender
Claims and (ii) if any Pari Passu Lien Obligations shall be designated as such,
all Liens granted upon such Common Collateral to secure Pari Passu Lien
Obligations.  Upon delivery to the
Trustee of an Officer’s Certificate stating that any such termination and
release of Liens securing the Senior Lender Claims and, if applicable, the Pari
Passu Lien Obligations has become effective (or shall become effective
concurrently with such termination and release of the Liens granted to the
Trustee) and any necessary or proper instruments of termination or release
prepared by the Company or any other Grantor, the Trustee will promptly
execute, deliver or acknowledge, at the Company’s or the other Grantors’ sole
cost and expense, such instruments to evidence such termination and release of
the Liens granted to the Trustee. 
Nothing in this Section 5.1(a) shall be deemed to affect the agreement
of the Trustee, for itself and on behalf of each holder of Notes, to release
the Liens on the Noteholder Collateral as set forth in the Indenture.

(b)           The
Trustee, for itself and on behalf of each Noteholder, hereby irrevocably
constitutes and appoints the Intercreditor Agent and any officer or agent of
the Intercreditor Agent, with full power of substitution, as its true and
lawful attorney-in-fact with full irrevocable power and authority in the place
and stead of the Trustee or such holder or in the Intercreditor Agent’s own
name, from time to time in the Intercreditor Agent’s discretion, for the
purpose of carrying out the terms of Section
5.1(a), to take any and all appropriate action and to execute any and
all documents and instruments that may be necessary or desirable to accomplish
the purposes of Section 5.1(a),
including any termination statements, endorsements or other instruments of
transfer or release.

(c)           Unless
and until the Discharge of Senior Lender Claims has occurred, the Trustee, for
itself and on behalf of each Noteholder, hereby consents to the application,
whether prior to or after an event of default under the Senior Credit
Agreement, of Deposit Account Collateral or proceeds of Common Collateral to
the repayment of Senior Lender Claims pursuant to the Senior Credit Agreement, provided that nothing in this Section 5.1(c) shall be
construed to prevent or impair the rights of the Trustee or the Noteholders to
receive proceeds in connection with the Noteholder Claims not otherwise in
contravention of this Agreement.

(d)           Notwithstanding
anything to the contrary in any Noteholder Collateral Document, in the event
the terms of a Senior Collateral Document and a Noteholder Collateral Document
each require any Grantor (i) to make payment in respect of any item of Common
Collateral, (ii) to deliver or afford control over any item of Common
Collateral to, or deposit any item of Common Collateral with, (iii) to register
ownership of any item of Common Collateral in the name of or make an assignment
of ownership of any Common Collateral or the rights

 12
 

thereunder to,
(iv) cause any securities intermediary, commodity intermediary or other Person
acting in a similar capacity to agree to comply, in respect of any item of
Common Collateral, with instructions or orders from, or to treat, in respect of
any item of Common Collateral, as the entitlement holder, (v) hold any
item of Common Collateral in trust for (to the extent such item of Common
Collateral cannot be held in trust for multiple parties under applicable law),
(vi) obtain the agreement of a bailee or other third party to hold any
item of Common Collateral for the benefit of or subject to the control of or,
in respect of any item of Common Collateral, to follow the instructions of or
(vii) obtain the agreement of a landlord with respect to access to leased
premises where any item of Common Collateral is located or waivers or
subordination of rights with respect to any item of Common Collateral in favor
of, in any case, both the Intercreditor Agent and the Trustee, such Grantor
may, until the applicable Discharge of Senior Lender Claims has occurred,
comply with such requirement under the Noteholder Collateral Document as it
relates to such Common Collateral by taking any of the actions set forth above
only with respect to, or in favor of, the Intercreditor Agent.

5.2           Insurance and Condemnation Awards.  Unless and until the Discharge of Senior
Lender Claims has occurred, the Intercreditor Agent and the Senior Lenders
shall have the sole and exclusive right, subject to the rights of the Grantors
under the Senior Lender Documents, (a) to be named as additional insured and
loss payee under any insurance policies maintained from time to time by any
Grantor, (b) to adjust settlement for any insurance policy covering the Common
Collateral in the event of any loss thereunder and (c) to approve any award
granted in any condemnation or similar proceeding affecting the Common
Collateral.  Unless and until the
Discharge of Senior Lender Claims has occurred, all proceeds of any such policy
and any such award, if in respect of the Common Collateral, shall be paid (i) first,
prior to the occurrence of the Discharge of Senior Lender Claims, to the
Intercreditor Agent for the benefit of Senior Lenders pursuant to the terms of
the Senior Lender Documents, (ii) second, after the occurrence of
the Discharge of Senior Lender Claims, to the Trustee for the benefit of the
Noteholders pursuant to the terms of the applicable Noteholder Documents and
(iii) third, if no Noteholder Claims are outstanding, to the owner
of the subject property, such other Person as may be entitled thereto or as a
court of competent jurisdiction may otherwise direct.  If the Trustee or any Noteholder shall, at
any time, receive any proceeds of any such insurance policy or any such award in
contravention of this Agreement, it shall pay such
proceeds over to the Intercreditor Agent in accordance with the terms of Section
4.2.

5.3           Amendments
to Noteholder Collateral Documents.

(a)           Without
the prior written consent of the Intercreditor Agent and the Required Lenders,
no Noteholder Collateral Document may be amended, supplemented or otherwise
modified or entered into to the extent such amendment, supplement or
modification, or the terms of any new Noteholder Collateral Document, would be
prohibited by or inconsistent with any of the terms of this Agreement.  The Company agrees to deliver to the
Intercreditor Agent copies of (i) any amendments, supplements or other
modifications to the Noteholder Collateral Documents and (ii) any new
Noteholder Collateral Documents promptly after effectiveness thereof.  The Trustee, on behalf of itself and each
Noteholder, agrees that each Noteholder Collateral Document (other than any
account control or similar agreement with third parties) shall include the
following language (or language to similar effect approved by the Intercreditor
Agent):

 13
 

“Notwithstanding anything
herein to the contrary, (i) the liens and security interests granted to
the Trustee pursuant to this Agreement are expressly subject and subordinate to
the liens and security interests granted in favor of the Senior Lenders (as
defined in the Intercreditor Agreement referred to below), including liens and
security interests granted to JPMorgan Chase Bank, N.A., as administrative agent,
pursuant to or in connection with the Credit Agreement dated as of
February 2, 2006 (as amended, restated, supplemented or otherwise modified
from time to time), among Indalex Holdings Finance, Inc., the “Borrowers” named
therein, JPMorgan Chase Bank, N.A., as administrative agent, the lenders party
thereto and the other parties party thereto, and (ii) the exercise of any
right or remedy by the Trustee hereunder is subject to the limitations and
provisions of the Intercreditor Agreement dated as of February 2, 2006 (as
amended, restated, supplemented or otherwise modified from time to time, the “Intercreditor Agreement”), among
JPMorgan Chase Bank, N.A., as Intercreditor Agent, U.S. Bank National
Association, as Trustee, Indalex Holdings Finance, Inc. and its subsidiaries
party thereto.  In the event of any
conflict between the terms of the Intercreditor Agreement and the terms of this
Agreement, the terms of the Intercreditor Agreement shall govern.”

(b)           In
the event that the Intercreditor Agent or the Senior Lenders enter into any
amendment, waiver or consent in respect of any of the Senior Collateral
Documents for the purpose of adding to or deleting from, or waiving or
consenting to any departures from any provisions of, any Senior Collateral
Document or changing in any manner the rights of the Intercreditor Agent, the
Senior Lenders, the Company or any other Grantor thereunder (including the
release of any Liens in Senior Lender Collateral), then such amendment, waiver
or consent shall apply automatically to any comparable provision of the
Comparable Noteholder Collateral Document without the consent of the Trustee or
any Noteholder and without any action by the Trustee, the Company or any other
Grantor; provided, however,
that (A) if such
amendment, waiver or consent materially adversely affect the rights of the
Noteholders or the interests of the Noteholders in the Noteholder Collateral,
it shall similarly affect comparable rights and interests of holders of Pari
Passu Lien Obligations, if any are then outstanding, and (B) written
notice of such amendment, waiver or consent shall have been given to the
Trustee within 10 Business Days after the effectiveness of such amendment,
waiver or consent.

5.4           Rights as Unsecured Creditors.  Notwithstanding anything to the contrary in
this Agreement, the Trustee and the Noteholders may exercise rights and
remedies as unsecured creditors against the Company and any other Grantor in
accordance with the terms of the Noteholder Documents and applicable law.  Nothing in this Agreement shall prohibit the
receipt by the Trustee or any Noteholder of the required payments of principal,
premium, interest, fees and other amounts due under the Noteholders Documents
so long as such receipt is not the direct or indirect result of the exercise by
the Trustee or any Noteholder of rights or remedies as a secured creditor in
respect of Common Collateral.  In the
event the Trustee or any Noteholder becomes a judgment lien creditor in respect
of Common Collateral as a result of its enforcement of its rights as an
unsecured creditor in respect of Noteholder Claims, such judgment lien shall be
subordinated to the Liens securing Senior Lender Claims on the same basis as
the other Liens securing the Noteholder Claims are so subordinated to such
Liens securing Senior Lender Claims under this Agreement.  Nothing in this Agreement shall impair or

 14
 

otherwise
adversely affect any rights or remedies the Intercreditor Agent or the Senior
Lenders may have with respect to the Senior Lender Collateral.

5.5           Gratuitous
Bailee for Perfection.

(a)           The
Intercreditor Agent acknowledges and agrees that if it shall at any time hold a
Lien securing any Senior Lender Claims on any Common Collateral that can be
perfected by the possession or control of such Common Collateral or of any
account in which such Common Collateral is held, and if such Common Collateral
or any such account is in fact in the possession or under the control of the
Intercreditor Agent, or of agents or bailees of the Intercreditor Agent (such Common
Collateral being referred to herein as the “Pledged or Controlled Collateral”), or if it shall any
time obtain any landlord waiver or bailee’s letter or any similar agreement or
arrangement granting it rights or access to Common Collateral, the Intercreditor
Agent shall also hold such Pledged or Controlled Collateral, or take such
actions with respect to such landlord waiver, bailee’s letter or similar
agreement or arrangement, as sub-agent or gratuitous bailee for the Trustee, in
each case solely for the purpose of perfecting the Liens granted under the
Noteholder Collateral Documents and subject to the terms and conditions of this
Section 5.5.

(b)           In
the event that the Intercreditor Agent (or its agents or bailees) has Lien
filings against Intellectual Property that is part of the Common Collateral
that are necessary for the perfection of Liens in such Common Collateral, the
Intercreditor Agent agrees to hold such Liens as sub-agent and gratuitous
bailee for the Trustee and any assignee thereof, solely for the purpose of
perfecting the security interest granted in such Liens pursuant to the
Noteholder Collateral Documents, subject to the terms and conditions of this
Section 5.5.

(c)           Except
as otherwise specifically provided herein, until the Discharge of Senior Lender
Claims has occurred, the Intercreditor Agent shall be entitled to deal with the
Pledged or Controlled Collateral in accordance with the terms of the Senior
Lender Documents as if the Liens under the Noteholder Collateral Documents did
not exist.  The rights of the Trustee and
the Noteholders with respect to the Pledged or Controlled Collateral shall at
all times be subject to the terms of this Agreement.

(d)           The
Intercreditor Agent shall have no obligation whatsoever to the Trustee or any Noteholder
to assure that any of the Pledged or Controlled Collateral is genuine or owned
by the Grantors or to protect or preserve rights or benefits of any Person or
any rights pertaining to the Common Collateral, except as expressly set forth
in this Section 5.5.  The duties or responsibilities of the
Intercreditor Agent under this Section 5.5 shall be limited solely to holding
or controlling the Common Collateral and the related Liens referred to in
paragraphs (a) and (b) of this Section 5.5 as sub-agent and gratuitous bailee
for the Trustee for purposes of perfecting the Lien held by the Trustee.

(e)           The
Intercreditor Agent shall not have by reason of the Noteholder Collateral
Documents or this Agreement, or any other document, a fiduciary relationship in
respect of the Trustee or any Noteholder, and the Trustee, on behalf of itself
and each Noteholder, hereby waives and releases the Intercreditor Agent from
all claims and liabilities arising pursuant to the Intercreditor Agent’s role
under this Section 5.5 as sub-agent and

 15
 

gratuitous bailee with respect to the Common Collateral.

(f)            Upon
the Discharge of Senior Lender Claims, the Intercreditor Agent shall, at the
Grantors’ sole cost and expense, (i) (A) deliver to the Trustee, to the extent
that it is legally permitted to do so, all Common Collateral, including all
proceeds thereof, held or controlled by the Intercreditor Agent or any of its
agents or bailees, including the transfer of possession and control, as
applicable, of the Pledged or Controlled Collateral, together with any
necessary endorsements and notices to depositary banks, securities
intermediaries and commodities intermediaries, and assign its rights under any
landlord waiver or bailee’s letter or any similar agreement or arrangement
granting it rights or access to Common Collateral (including pursuant to the
delivery of change of agent notices under deposit account control agreements
and similar agreements), or (B) direct and deliver such Common Collateral as a
court of competent jurisdiction may otherwise direct, (ii) notify any
applicable insurance carrier that it is no longer entitled to be a loss payee
or additional insured under the insurance policies of any Grantor issued by
such insurance carrier and (iii) notify any governmental authority involved in
any condemnation or similar proceeding involving any Grantor that the Trustee
is entitled to approve any awards granted in such proceeding.  The Company and the other Grantors shall take
such further action as is required to effectuate the transfer contemplated
hereby and shall indemnify the Intercreditor Agent for loss or damage suffered
by the Intercreditor Agent as a result of such transfer, except for loss or
damage suffered by the Intercreditor Agent as a result of its own wilful misconduct,
gross negligence or bad faith.  The
Intercreditor Agent has no obligation to follow instructions from the Trustee
in contravention of this Agreement.

(g)           Neither
the Intercreditor Agent nor the Senior Lenders shall be required to marshal any
present or future collateral security for any obligations of the Company or any
Subsidiary to the Intercreditor Agent or the Senior Lenders under the Senior
Lender Documents or any assurance of payment in respect thereof, or to resort
to such collateral security or other assurances of payment in any particular
order, and all of their rights in respect of such collateral security or any
assurance of payment in respect thereof shall be cumulative and in addition to
all other rights, however existing or arising.

5.6           When Discharge of Senior Lender Claims Deemed to Not Have
Occurred.  If, at any time after the Discharge of Senior
Lender Claims has occurred, the Company or any Subsidiary Incurs any Senior
Lender Claims (other than any Senior Lender Claims referred to in clause
(c) of the definition thereof), then such Discharge of Senior Lender
Claims shall automatically be deemed not to have occurred for all purposes of
this Agreement (other than with respect to any actions taken prior to the date
of such designation as a result of the occurrence of such first Discharge of
Senior Lender Claims) and the applicable agreement governing such Senior Lender
Claims shall automatically be treated as a Senior Credit Agreement for all
purposes of this Agreement, including for purposes of the Lien priorities and
rights in respect of Common Collateral set forth herein and the granting by the
Intercreditor Agent of amendments, waivers and consents hereunder and the
agent, representative or trustee for the holders of such Senior Lender Claims
shall be the Intercreditor Agent for all purposes of this Agreement.  Upon receipt of notice of such Incurrence
(including the identity of the new Intercreditor Agent), the Trustee shall
promptly (a) enter into such documents and agreements (at the expense of
the Company), including amendments or supplements to this Agreement, as the
Company or such new Intercreditor Agent shall reasonably request in writing in
order to provide

 16
 

the new Intercreditor Agent the rights of the
Intercreditor Agent contemplated hereby, (b) deliver to the Intercreditor
Agent, to the extent that it is legally permitted to do so, all Common
Collateral, including all proceeds thereof, held or controlled by the Trustee
or any of its agents or bailees, including the transfer of possession and
control, as applicable, of the Pledged or Controlled Collateral, together with
any necessary endorsements and notices to depositary banks, securities
intermediaries and commodities intermediaries, and assign its rights under any
landlord waiver or bailee’s letter or any similar agreement or arrangement
granting it rights or access to Common Collateral, (c) notify any
applicable insurance carrier that it is no longer entitled to be a loss payee
or additional insured under the insurance policies of any Grantor issued by
such insurance carrier and (d) notify any governmental authority involved
in any condemnation or similar proceeding involving a Grantor that the new
Intercreditor Agent is entitled to approve any awards granted in such proceeding.

5.7           No Release if Event of Default.  Notwithstanding any other provision contained
in this Agreement, if an Event of Default (as defined in the Indenture) exists
on the date on which the Discharge of Senior Lender Claims has occurred, the
Liens securing Noteholder Claims will not be released, except to the extent the
Noteholder Collateral or any portion thereof was disposed of in order to repay
the Senior Lender Claims secured by such Noteholder Collateral, and following
the Discharge of Senior Lender Claims, the Trustee will have the right to
foreclose upon such Noteholder Collateral (but in such event, the Liens on such
Noteholder Collateral securing the Noteholder Claims will be released when such
Event of Default and all other Events of Default under the Indenture cease to
exist).

Section
6.         Insolvency or Liquidation
Proceedings.

6.1           Financing Issues.  Until the Discharge of Senior Lender Claims
has occurred, if the Company or any other Grantor shall be subject to any
Insolvency or Liquidation Proceeding and the Intercreditor Agent or any Senior
Lender shall desire to consent (or not object) to the sale, use or lease of
cash or other collateral or to consent (or not object) to the Company’s or any
other Grantor’s obtaining financing under Section 363 or Section 364 of Title
11 of the United States Code or any similar provision of any other Bankruptcy
Law (“DIP Financing”),
then the Trustee, on behalf of itself and each Noteholder, agrees that it will
raise no (a) objection to and will not otherwise contest such sale, use or
lease of such cash or other collateral or such DIP Financing and, except to the
extent permitted by the proviso in clause (ii) of Section 3.1(a)
and Section
6.3, will not request adequate protection or any other
relief in connection therewith and, to the extent the Liens securing the Senior
Lender Claims under the Senior Credit Agreement or, if no Senior Credit
Agreement exists, under the other Senior Lender Documents are subordinated or pari passu with
such DIP Financing, will subordinate (and will be deemed hereunder to have
subordinated) its Liens in the Common Collateral to (x) such DIP Financing (and
all Obligations relating thereto) on the same basis as the Liens securing the
Noteholder Claims are so subordinated to Liens securing Senior Lender Claims
under this Agreement and (y) to any “carve-out” for professional and United
States Trustee fees agreed to by the Intercreditor Agent or the Senior Lenders,
(b) objection and will not otherwise contest any motion for relief from the automatic
stay or from any injunction against foreclosure or enforcement in respect of
Senior Lender Claims made by Intercreditor Agent or any other Senior Lender,
(c) objection to (and will not otherwise contest) any lawful exercise by any
Senior Lender of the right to credit bid Senior Lender Claims at any sale in

 17
 

foreclosure of Senior Lender Collateral,
(d) objection to (and will not otherwise contest) any other request for
judicial relief made in any court by any Senior Lender relating to the lawful
enforcement of any Lien on Senior Lender Collateral or (e) objection to (and
will not otherwise contest or oppose) any order relating to a sale or other
disposition of assets of any Grantor for which the Intercreditor Agent has
consented that provides, to the extent such sale or other disposition is to be
free and clear of Liens, that the Liens securing the Senior Lender Claims and
the Noteholder Claims will attach to the proceeds of the sale on the same basis
of priority as the Liens on the Common Collateral securing the Senior Lender
Claims rank to the Liens on the Common Collateral securing the Noteholder
Claims pursuant to this Agreement.  The
Trustee, on behalf of itself and the Noteholders, agrees that notice received
two Business Days prior to the entry of an order approving such usage of cash
or other collateral or approving such financing shall be adequate notice.

6.2           Relief from the Automatic Stay.  Until the Discharge of Senior Lender Claims
has occurred, the Trustee, on behalf of itself and each Noteholder, agrees that
none of them shall seek relief from the automatic stay or any other stay in any
Insolvency or Liquidation Proceeding or take any action in derogation thereof,
in each case in respect of any Common Collateral, without the prior written consent
of the Intercreditor Agent.

6.3           Adequate Protection.  The Trustee, on behalf of itself and each
Noteholder, agrees that none of them shall object, contest or support any other
Person objecting to or contesting (a) any request by the Intercreditor Agent or
the Senior Lenders for adequate protection, (b) any objection by the
Intercreditor Agent or the Senior Lenders to any motion, relief, action or
proceeding based on the Intercreditor Agent’s or any Senior Lender’s claiming a
lack of adequate protection or (c) the payment of interest, fees, expenses or
other amounts of the Intercreditor Agent or any other Senior Lender under
Section 506(b) or 506(c) of Title 11 of the United States Code or any similar
provision of any other Bankruptcy Law. 
Notwithstanding anything contained in this Section 6.3 or in Section
6.1, in any Insolvency or Liquidation Proceeding, (i) if the Senior Lenders (or
any subset thereof) are granted adequate protection in the form of additional
collateral in connection with any DIP Financing or use of cash collateral under
Section 363 or 364 of Title 11 of the United States Code or any similar
provision of any other Bankruptcy Law and the Intercreditor Agent and the other
Senior Lenders do not object to the adequate protection being provided to the
Senior Lenders, then the Trustee, on behalf of itself and any Noteholder, may
seek or request adequate protection in the form of a replacement Lien on such
additional collateral, which Lien is subordinated to the Liens securing the
Senior Lender Claims and such DIP Financing (and all Obligations relating
thereto) on the same basis as the other Liens securing the Noteholder Claims
are so subordinated to the Liens securing Senior Lender Claims under this
Agreement and (ii) in the event the Trustee, on behalf of itself and each
Noteholder, seeks or requests adequate protection and such adequate protection
is granted in the form of additional collateral, then the Trustee, on behalf of
itself or each Noteholder, agrees that the Intercreditor Agent shall also be
granted a senior Lien on such additional collateral as security for the Senior
Lender Claims and any such DIP Financing and that any Lien on such additional
collateral securing the Noteholder Claims shall be subordinated to the Liens on
such collateral securing the Senior Lender Claims and any such DIP Financing
(and all Obligations relating thereto) and any other Liens granted to the
Senior Lenders as adequate protection on the same basis as the other Liens
securing the Noteholder Claims are so subordinated to such Liens securing
Senior Lender Claims under this Agreement.

 18
 

6.4           Preference Issues.  If any Senior Lender is required in any
Insolvency or Liquidation Proceeding or otherwise to disgorge, turn over or
otherwise pay any amount to the estate of the Company or any other Grantor (or
any trustee, receiver or similar Person therefor), because the payment of such
amount was declared to be fraudulent or preferential in any respect or for any
other reason, any amount (a “Recovery”),
whether received as proceeds of security, enforcement of any right of setoff or
otherwise, then the Senior Lender Claims shall be reinstated to the extent of
such Recovery and deemed to be outstanding as if such payment had not occurred
and the Senior Lenders shall be entitled to a Discharge of Senior Lender Claims
with respect to all such recovered amounts. 
If this Agreement shall have been terminated prior to such Recovery,
this Agreement shall be reinstated in full force and effect, and such prior
termination shall not diminish, release, discharge, impair or otherwise affect
the obligations of the parties hereto. 
The Trustee, on behalf of itself and each Noteholder, hereby agrees that
none of them shall be entitled to benefit from any avoidance action affecting
or otherwise relating to any distribution or allocation made in accordance with
this Agreement, whether by preference or otherwise, it being understood and
agreed that the benefit of such avoidance action otherwise allocable to them
shall instead be allocated and turned over for application in accordance with
the priorities set forth in this Agreement.

6.5           Separate
Grants of Security and Separate Classifications.  The Trustee, on behalf of itself and each
Noteholder, acknowledges and agrees that (a) the grants of Liens pursuant to
the Senior Collateral Documents and the Noteholder Collateral Documents
constitute two separate and distinct grants of Liens and (b) because of, among
other things, their differing rights in the Common Collateral, the Noteholder
Claims are fundamentally different from the Senior Lender Claims and must be
separately classified in any plan of reorganization proposed or adopted in an
Insolvency or Liquidation Proceeding.  To
further effectuate the intent of the parties as provided in the immediately
preceding sentence, if it is held that the claims of the Senior Lenders and the
Noteholders in respect of the Common Collateral constitute only one secured
claim (rather than separate classes of senior and junior secured claims), then
the Trustee, on behalf of itself and each Noteholder, hereby acknowledges and
agrees that all distributions shall be made as if there were separate classes
of senior and junior secured claims against the Grantors in respect of the
Common Collateral (with the effect being that, to the extent that the aggregate
value of the Common Collateral is sufficient (for this purpose ignoring all
claims held by the Noteholders), the Senior Lenders shall be entitled to
receive, in addition to amounts distributed to them in respect of principal,
pre-petition interest and other claims, all amounts owing in respect of
post-petition interest (whether or not allowed or allowable) before any
distribution is made in respect of the Noteholder Claims, with the Trustee, on
behalf of itself and each Noteholder, hereby acknowledging and agreeing to turn
over to the Intercreditor Agent amounts otherwise received or receivable by
them to the extent necessary to effectuate the intent of this sentence, even if
such turnover has the effect of reducing the claim or recovery of the
Noteholders.

6.6           No
Waivers of Rights of Senior Lenders.  Nothing contained herein shall, except as
expressly provided herein, prohibit or in any way limit the Intercreditor Agent
or any other Senior Lender from objecting in any Insolvency or Liquidation
Proceeding or otherwise to any action taken by any Noteholder, including the
seeking by any Noteholder of adequate protection or the asserting by any
Noteholder of any of its rights and remedies under the Noteholder Documents or
otherwise.

 19
 

6.7           Application.  This Agreement, which the parties hereto
expressly acknowledge is a “subordination agreement” under Section 510(a) of
Title 11 of the United States Code or any similar provision of any other
Bankruptcy Law, shall be effective before, during and after the commencement of
any Insolvency or Liquidation Proceeding. 
The relative rights as to the Common Collateral and proceeds thereof
shall continue after the commencement of any Insolvency or Liquidation
Proceeding on the same basis as prior to the date of the petition therefor,
subject to any court order approving the financing of, or use of cash
collateral by, any Grantor.  All
references herein to any Grantor shall include such Grantor as a
debtor-in-possession and any receiver or trustee for such Grantor.

6.8           Other
Matters.  To the extent
that the Trustee or any Noteholder has or acquires rights under Section 363 or
Section 364 of Title 11 of the United States Code or any similar provision of
any other Bankruptcy Law with respect to any of the Common Collateral, the
Trustee, on behalf of itself and each Noteholder, agrees not to assert any such
rights without the prior written consent of the Intercreditor Agent, provided that if requested by the
Intercreditor Agent, the Trustee shall timely exercise such rights in the
manner requested by the Intercreditor Agent, including any rights to payments
in respect of such rights.

6.9           506(c) Claims.  Until the Discharge of Senior Lender Claims
has occurred, the Trustee, on behalf of itself and each Noteholder, will not
assert or enforce any claim under Section 506(c) of Title 11 of the United
States Code or any similar provision of any other Bankruptcy Law senior to or
on a parity with the Liens securing the Senior Lender Claims for costs or
expenses of preserving or disposing of any Common Collateral.

6.10         Reorganization Securities.  If, in any Insolvency or Liquidation
Proceeding, debt obligations of the reorganized debtor secured by Liens upon
any property of the reorganized debtor are distributed, pursuant to a plan of
reorganization or similar dispositive restructuring plan, on account of both
the Senior Lender Claims and the Noteholder Claims, then, to the extent the
debt obligations distributed on account of the Senior Lender Claims and on
account of the Noteholder Claims are secured by Liens upon the same assets or
property, the provisions of this Agreement will survive the distribution of
such debt obligations pursuant to such plan and will apply with like effect to
the Liens securing such debt obligations.

Section 7.         Reliance; etc.

7.1           Reliance.  The consent by the Senior Lenders to the
execution and delivery of the Noteholder Documents to which the Senior Lenders
have consented and all loans and other extensions of credit made or deemed made
on and after the date hereof by the Senior Lenders to the Company or any
Subsidiary shall be deemed to have been given and made in reliance upon this
Agreement.  The Trustee, on behalf of
itself and each Noteholder, acknowledges that it and the Noteholders have,
independently and without reliance on the Intercreditor Agent or any Senior
Lender, and based on documents and information deemed by them appropriate, made
their own credit analysis and decision to enter into the Indenture, this
Agreement and the transactions contemplated hereby and thereby, and they will
continue to make their own credit decision in taking or not taking any action
under the Indenture or this Agreement.

 20
 

7.2           No Warranties or Liability.  The Trustee, on behalf of itself and each
Noteholder, acknowledges and agrees that neither the Intercreditor Agent nor
any Senior Lender has made any express or implied representation or warranty,
including with respect to the execution, validity, legality, completeness,
collectibility or enforceability of any of the Senior Lender Documents, the
ownership of any Common Collateral or the perfection or priority of any Liens
thereon.  The Senior Lenders will be
entitled to manage and supervise their respective loans and extensions of
credit under the Senior Lender Documents in accordance with law and as they may
otherwise, in their sole discretion, deem appropriate, and the Senior Lenders
may manage their loans and extensions of credit without regard to any rights or
interests that the Trustee or any of the Noteholders have in the Common
Collateral or otherwise, except as otherwise provided in this Agreement.  Neither the Intercreditor Agent nor any
Senior Lender shall have any duty to the Trustee or any Noteholder to act or
refrain from acting in a manner that allows, or results in, the occurrence or
continuance of an event of default or default under any agreement with the
Company or any Subsidiary (including the Noteholder Documents), regardless of
any knowledge thereof that they may have or be charged with.  Except as expressly set forth in this
Intercreditor Agreement, the Intercreditor Agent, the Senior Lenders, the
Trustee and the Noteholders have not otherwise made to each other, nor do they
hereby make to each other, any warranties, express or implied, nor do they
assume any liability to each other with respect to (a) the enforceability,
validity, value or collectibility of any of the Senior Lender Claims, the
Noteholder Claims or any guarantee or security which may have been granted to
any of them in connection therewith, (b) any Grantor’s title to or right
to transfer any of the Common Collateral or (c) any other matter except as
expressly set forth in this Intercreditor Agreement.

7.3           Obligations Unconditional.  All rights, interests, agreements and
obligations of the Intercreditor Agent, the Senior Lenders, the Trustee and the
Noteholders hereunder shall remain in full force and effect irrespective of:

(a)           any
lack of validity or enforceability of any Senior Lender Document or any
Noteholder Document;

(b)           any
change in the time, manner or place of payment of, or in any other terms of,
all or any of the Senior Lender Claims or Noteholder Claims, or any amendment
or waiver or other modification, including any increase in the amount thereof,
whether by course of conduct or otherwise, of the terms of the Senior Credit
Agreement or any other Senior Lender Document or of the terms of the Indenture
or any other Noteholder Document;

(c)           any
exchange of any security interest in any Common Collateral or any other
collateral or any amendment, waiver or other modification, whether in writing
or by course of conduct or otherwise, of all or any of the Senior Lender Claims
or Noteholder Claims or any guarantee thereof;

(d)           the
commencement of any Insolvency or Liquidation Proceeding in respect of the
Company or any other Grantor; or

(e)           any
other circumstances that otherwise might constitute a defense available to, or
a discharge of, (i) the Company or any other Grantor in respect of the Senior
Lender Claims or (ii) the Trustee or any Noteholder in respect of this
Agreement.

 21
 

Section 8.         Miscellaneous.

8.1           Conflicts.  Subject to Section 8.18, in the event of
any conflict between the provisions of this Agreement and the provisions of any
Senior Lender Document or any Noteholder Document, the provisions of this
Agreement shall govern.

8.2           Continuing Nature of this Agreement; Severability.  Subject to Section 6.4, this Agreement
shall continue to be effective until the Discharge of Senior
Lender Claims shall have occurred.  This
is a continuing agreement of Lien subordination, and the Senior Lenders may
continue, at any time and without notice to the Trustee or any Noteholder, to
extend credit and other financial accommodations and lend monies to or for the
benefit of the Company or any Subsidiary constituting Senior Lender Claims in
reliance hereon.  The terms of this
Agreement shall survive and continue in full force and effect in any Insolvency
or Liquidation Proceeding.  Any provision
of this Agreement that is prohibited or unenforceable in any jurisdiction shall
not invalidate the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

8.3           Amendments; Waivers.  No amendment, modification or waiver of any
of the provisions of this Agreement by the Intercreditor Agent or the Trustee
shall be deemed to have been made unless the same shall be in writing signed on
behalf of the party making the same or its authorized agent and each waiver, if
any, shall be a waiver only with respect to the specific instance involved and
shall in no way impair the rights of the parties making such waiver or the
obligations of the other parties to such party in any other respect or at any
other time.  The Company and the other
Grantors shall not have any right to consent to or approve any amendment,
modification or waiver of any provision of this Agreement except to the extent
their rights are affected.  Notwithstanding
anything in this Section 8.3 to the contrary, the Intercreditor Agent and
the Trustee shall enter, at the Company’s or the other Grantors’ sole expense,
into such amendments, supplements or other modifications of this Agreement as
may be reasonably requested by the Company (a) to add as parties hereto Persons
(or any agent, representative or trustee therefor) holding a new series of
Senior Lender Claims or Persons (or any agent, representative or trustee
therefor) holding Refinancing Noteholder Claims or Pari Passu Lien Obligations,
in each case, to the extent such Indebtedness or other Obligations are not
prohibited by the Senior Credit Agreement and the Indenture, (b) in the
case of any Refinancing Noteholder Claims or Pari Passu Lien Obligations,
(i) to establish that the Liens on the Common Collateral securing such
Refinancing Noteholder Claims or Pari Passu Lien Obligations shall be junior
and subordinate in all respects to all Liens on the Common Collateral securing
any Senior Lender Claims and shall share in the benefits of the Common
Collateral equally and ratably with all Liens on the Common Collateral securing
any Noteholder Claims in accordance with the terms of this Agreement and
(ii) to provide to the holders of such Refinancing Noteholder Claims or
Pari Passu Lien Obligations (or any agent, representative or trustee thereof)
rights and benefits substantially identical to those provided to the Trustee
and the Noteholders under this Agreement, and to place upon the holders of such
Refinancing Noteholder Claims or Pari Passu Lien Obligations (or any agent,
representative or trustee thereof) obligations and limitations substantially
identical to those placed on the Trustee and the Noteholders under this
Agreement, and (c) in the case of a new series of Senior Lender Claims,
(i) to establish that the Lien on the Common Collateral securing such
Senior Lender Claims shall be superior in all respects to all

 22
 

Liens on the Common Collateral securing any Noteholder Claims,
Refinancing Noteholder Claims and Pari Passu Lien Obligations and shall share
in the benefits of the Common Collateral equally and ratably with all Liens on
the Common Collateral securing any other Senior Lender Claims and (ii) to
provide to the holders of such Senior Lender Claims (or any agent,
representative or trustee thereof) rights and benefits substantially identical
to those provided to the Senior Lenders under this Agreement, and to place upon
the holders of such Senior Lender Claims (or any agent, representative or
trustee thereof) obligations and limitations substantially identical to those
placed on the Intercreditor Agent and the Senior Lenders under this Agreement,
in each case under clauses (a), (b) and (c) above, so long as (x) such
amendment, supplement or other modification does not expressly violate the
provisions of the Senior Credit Agreement and the Indenture or the intent of
this Agreement (it being acknowledged that it is the intent of the parties
hereto that Senior Lender Claims of any series be treated under this Agreement
in the manner substantially identical to the treatment of the Senior Lender
Claims of each other series and that any Refinancing Noteholder Claims and Pari
Passu Lien Obligations be treated under this Agreement in the manner
substantially identical to the treatment of the Noteholder Claims) and (y) the
Company delivers to each of the Intercreditor Agent and the Trustee an Officers’
Certificate to the effect that such amendment, supplement or other modification
complies with the provisions of this paragraph. 
Any such Person becoming a party hereto, the Intercreditor Agent and the
Trustee shall be entitled to rely on such Officers’ Certificate; provided, however,
that nothing in such Officers’ Certificate shall affect whether or not the
Company or any Subsidiary has complied with its undertakings in the Senior
Credit Agreement, the other Senior Lender Documents, the Indenture, the other
Noteholder Documents or this Agreement.

8.4           Information Concerning Financial Condition of the Company and the Subsidiaries.  The
Intercreditor Agent, the Senior Lenders, the Trustee and the Noteholders shall
each be responsible for keeping themselves informed of (a) the financial
condition of the Company and the Subsidiaries and all endorsers or guarantors
of the Senior Lender Claims or the Noteholder Claims and (b) all other
circumstances bearing upon the risk of nonpayment of the Senior Lender Claims
or the Noteholder Claims.  The
Intercreditor Agent, the Senior Lenders, the Trustee and the Noteholders shall
have no duty to advise any other party hereunder of information known to it or
them regarding such condition or any such circumstances or otherwise.  In the event that the Intercreditor Agent,
any Senior Lender, the Trustee or any Noteholder, in its or their sole discretion,
undertakes at any time or from time to time to provide any such information to
any other party, it or they shall be under no obligation to (i) make, and the
Intercreditor Agent, the Senior Lenders, the Trustee and the Noteholders shall
not make, any express or implied representation or warranty, including with
respect to the accuracy, completeness, truthfulness or validity of any such
information so provided, (ii) provide any additional information or to provide
any such information on any subsequent occasion, (iii) undertake any
investigation or (iv) disclose any information that, pursuant to accepted or
reasonable commercial finance practices, such party wishes to maintain
confidential or is otherwise required to maintain confidential.

 23
 

8.5           Subrogation.  The Trustee, on behalf of itself and each
Noteholder, hereby waives any rights of subrogation it may acquire as a result
of any payment hereunder until the Discharge of Senior Lender Claims has
occurred.

8.6           Application of Payments.  Except as otherwise provided herein, all
payments received by the Senior Lenders may be applied, reversed and reapplied,
in whole or in part, to such part of the Senior Lender Claims as the Senior
Lenders, in their sole discretion, deem appropriate, consistent with the terms
of the Senior Lender Documents.  Except
as otherwise provided herein, the Trustee, on behalf of itself and each
Noteholder, assents to any such extension or postponement of the time of
payment of the Senior Lender Claims or any part thereof and to any other
indulgence with respect thereto, to any substitution, exchange or release of
any security that may at any time secure any part of the Senior Lender Claims
and to the addition or release of any other Person primarily or secondarily
liable therefor.

8.7           Consent to Jurisdiction; Waivers.  The parties hereto consent to the exclusive
jurisdiction of any state or federal court located in New York, New York, and
consent that all service of process may be made by registered mail directed to
such party as provided in Section 8.8 for
such party.  Service so made shall be
deemed to be completed three days after the same shall be posted as
aforesaid.  The parties hereto waive any
objection to any action instituted hereunder in any such court based on forum non conveniens,
and any objection to the venue of any action instituted
hereunder in any such court.  Each of the
parties hereto waives any right it may have to trial by jury in respect of any
litigation based on, or arising out of, under or in connection with this
Agreement, or any course of conduct, course of dealing, verbal or written
statement or action of any party hereto in connection with the subject matter
hereof.

8.8           Notices.  All notices to the Senior Lenders and the
Noteholders permitted or required under this Agreement may be sent to the
Intercreditor Agent and the Trustee as provided in the applicable Senior Credit
Agreement and the Indenture, respectively. 
All notices to any Grantor shall be sent as provided in the applicable
Senior Credit Agreement or the Indenture, as the case may be.  Unless otherwise specifically provided
herein, any notice or other communication herein required or permitted to be
given shall be in writing and may be personally served, telecopied,
electronically mailed or sent by courier service or U.S. mail and shall be
deemed to have been given when delivered in person or by courier service, upon
receipt of a telecopy or electronic mail or upon receipt via U.S. mail
(registered or certified, with postage prepaid and properly addressed).  For the purposes hereof, the addresses of the
parties hereto shall be as set forth below each party’s name on the signature
pages hereto, or, as to each party, at such other address as may be designated
by such party in a written notice to all of the other parties.  The Intercreditor Agent hereby agrees to
promptly notify the Trustee upon the Discharge of Senior Lender Claims.

8.9           Further Assurances.  Each of the Intercreditor Agent, on behalf of
itself and each Senior Lender, and the Trustee, on behalf of itself and each
Noteholder, agrees that each of them shall take such further action and shall
execute and deliver to the Intercreditor Agent, the Senior Lenders, the
Trustee, the Noteholders and the Company such additional documents and instruments
(in recordable form, if requested) as the other parties hereto may reasonably
request to effectuate the terms of and the lien priorities contemplated by this
Agreement.

 24
 

8.10         Governing Law.  This Agreement has been delivered and
accepted at and shall be deemed to have been made at New York, New York and
shall be interpreted, and the rights and liabilities of the parties bound
hereby determined, in accordance with the laws of the State of New York.

8.11         Binding on Successors and Assigns.  This Agreement shall be binding upon the
Intercreditor Agent, the Senior Lenders, the
Trustee, the Noteholders, the Company, the Subsidiaries party hereto and their
respective successors and assigns.

8.12         Section Titles.  The section titles contained in this
Agreement are and shall be without substantive meaning or content of any kind
whatsoever and are not a part of this Agreement.

8.13         Counterparts.  This Agreement may be executed in one or more
counterparts, including by means of facsimile, each of which shall be an original
and all of which shall together constitute one and the same document.

8.14         Authorization.  By its signature, each Person executing this
Agreement on behalf of a party hereto represents and warrants to the other
parties hereto that it is duly authorized to execute this Agreement.  The Intercreditor Agent represents and
warrants that this Agreement is binding upon the Senior Lenders.  The Trustee represents and warrants that this
Agreement is binding upon the Noteholders.

8.15         No Third Party Beneficiaries; Successors and Assigns.  The lien priorities set forth in this
Agreement and the rights and benefits hereunder in respect of such lien
priorities shall inure solely to the benefit of the Intercreditor Agent, the
other Senior Lenders, the Trustee and the Noteholders, and their respective
permitted successors and assigns, and no other Person (including the Grantors,
or any trustee, receiver, debtor in possession or bankruptcy estate in a
bankruptcy or like proceeding) shall have or be entitled to assert such rights.

8.16         Effectiveness.  This Agreement shall become effective when
executed and delivered by the parties hereto.

8.17         Intercreditor Agent and Trustee.  It is understood and agreed that
(a) JPMCB is entering into this Agreement in its capacity as Administrative
Agent under the Credit Agreement and the provisions of Article VIII of the
Credit Agreement applicable to JPMCB as administrative agent thereunder shall
also apply to JPMCB as Intercreditor Agent hereunder and (b) U.S. Bank National
Association is entering in this Agreement in its capacity as Trustee and the
provisions of Article 7 of the Indenture applicable to the Trustee thereunder
shall also apply to the Trustee hereunder.

8.18         Relative
Rights.  Notwithstanding anything in this
Agreement to the contrary (except to the extent contemplated by
Section 5.1(a), 5.1(d) or 5.3(b)), nothing in this Agreement is intended
to or will (a) amend, waive or otherwise modify the provisions of the Senior
Credit Agreement or the Indenture or any other Senior Lender Documents or
Noteholder Documents, or permit the Company or any Subsidiary to take any
action, or fail to take any action, to the extent such action or failure would
otherwise constitute a breach of, or default

 25
 

under, the Senior Credit Agreement or any other Senior Lender Documents
or the Indenture or any other Noteholder Documents, (b) change the relative
priorities of the Senior Lender Claims or the Liens granted under the Senior
Lender Documents on the Common Collateral (or any other assets) as among the
Senior Lenders, (c) otherwise change the relative rights of the Senior Lenders
in respect of the Common Collateral as among such Senior Lenders or (d)
obligate the Company or any Subsidiary to take any action, or fail to take any
action, that would otherwise constitute a breach of, or default under, the
Senior Credit Agreement or any other Senior Lender Document or the Indenture or
any other Noteholder Document.

8.19         Indenture Reference.  Notwithstanding anything to the contrary in
this Agreement, any references contained herein to any Section, clause,
paragraph, definition or other provision of the Indenture (including any
definition contained therein) shall be deemed to be a reference to such
Section, clause, paragraph, definition or other provision as in effect on the
date of this Agreement, provided
that any such reference to any such Section, clause, paragraph or other
provision shall refer to such Section, clause, paragraph or other provision of
the Indenture (including any definition contained therein), as amended or
modified from time to time, if such amendment or modification has been made in
accordance with the Indenture and approved in writing by, or on behalf of, the
Required Lenders.

 26
 

IN WITNESS WHEREOF, the parties hereto have
executed this Agreement as of the date first written above.

	
  

  	
  INTERCREDITOR AGENT:

  
	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE BANK, N.A.,

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  	
   

  
	
   

  	
       /s/ Peter S. Predun

  	
   

  
	
   

  	
  Name: Peter S. Predun

  
	
   

  	
  Title: Vice President

  

 

	
  

  	
  TRUSTEE:

  
	
   

  	
   

  
	
   

  	
  U.S. BANK NATIONAL ASSOCIATION,

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  	
   

  
	
   

  	
       /s/ Raymond S.
  Haverstock

  	
   

  
	
   

  	
  Name: Raymond S. Haverstock

  
	
   

  	
  Title: Vice President

  

 

	
  

  	
  COMPANY:

  
	
   

  	
   

  
	
   

  	
  INDALEX HOLDINGS FINANCE, INC.,

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  	
   

  
	
   

  	
       /s/ Michael E. Alger

  	
   

  
	
   

  	
  Name: Michael E. Alger

  
	
   

  	
  Title: Executive Vice President, Secretary,

  Treasurer and Chief Financial Officer

  

 

	
  

  	
  SUBSIDIARIES:

  
	
   

  	
   

  
	
   

  	
  INDALEX HOLDING CORP.,

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  	
   

  
	
   

  	
       /s/ Michael E. Alger

  	
   

  
	
   

  	
  Name: Michael E. Alger

  
	
   

  	
  Title: Executive Vice President, Secretary,

  Treasurer and Chief Financial Officer

  

 

 

 

 27
 

 

	
  

  	
  INDALEX INC.,

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  	
   

  
	
   

  	
       /s/ Michael E. Alger

  	
   

  
	
   

  	
  Name: Michael E. Alger

  
	
   

  	
  Title: Executive Vice President, Secretary,

  Treasurer and Chief Financial Officer

  

 

	
  

  	
  DOLTON ALUMINUM COMPANY, INC.,

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  	
   

  
	
   

  	
       /s/ Michael E. Alger

  	
   

  
	
   

  	
  Name: Michael E. Alger

  
	
   

  	
  Title: Executive Vice President, Secretary,

  Treasurer and Chief Financial Officer

  

 

	
  

  	
  CARADON LEBANON INC.,

  
	
   

  	
   

  
	
   

  	
   

  	
  By

  	
   

  	
   

  
	
   

  	
       /s/ Michael E. Alger

  	
   

  
	
   

  	
  Name: Michael E. Alger

  
	
   

  	
  Title: Executive Vice President, Secretary, 

  Treasurer and Chief Financial Officer

  

 

 28

SCHEDULE I

Subsidiary
Grantors

Caradon Lebanon Inc., a
Tennessee corporation

Dolton Aluminum Company,
Inc., a Wisconsin corporation

Indalex Holding Corp., a
Delaware corporation

Indalex Inc., a Delaware
corporation

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00114-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00114-of-00352.parquet"}]]