Document:

Exhibit 10.2

 

EXECUTION
COPY

 

PLEDGE
AND SECURITY AGREEMENT

 

THIS PLEDGE AND SECURITY
AGREEMENT (as the same may be amended, restated, supplemented or otherwise
modified from time to time, this “Security Agreement”) is entered into
as of September 26, 2007 by and among PRICELINE.COM INCORPORATED, a Delaware
corporation (the “Borrower”) and the other Subsidiaries of the Borrower
listed on the signature pages hereto (together with the Borrower, the “Initial
Grantors,” and together with any additional Domestic Subsidiaries, whether
now existing or hereafter formed which become parties to this Security
Agreement by executing a Supplement hereto in substantially the form of Annex
I, the “Grantors”), and JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a
national banking association, in its capacity as administrative agent (the “Administrative
Agent”) for the lenders party to the Credit Agreement referred to below
(collectively, the “Lenders”).

PRELIMINARY STATEMENT

The Borrower, the
Administrative Agent and the Lenders are entering into a Credit Agreement dated
as of the date hereof (as the same may be amended, restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”).  The Grantors are entering into this Security
Agreement in order to induce the Lenders to enter into and extend credit to the
Borrower under the Credit Agreement.

ACCORDINGLY, the Grantors
and the Administrative Agent, on behalf of the Holders of Secured Obligations,
hereby agree as follows:

ARTICLE
I

DEFINITIONS

1.1.          Terms
Defined in the Credit Agreement.  All capitalized terms used herein and not
otherwise defined shall have the meanings assigned to such terms in the Credit
Agreement.

1.2.          Terms
Defined in New York UCC. 
Terms defined in the New York UCC which are not otherwise defined in this
Security Agreement are used herein as defined in the New York UCC.

1.3.          Definitions
of Certain Terms Used Herein. 
As used in this Security Agreement, in addition to the terms defined in
the Preliminary Statement, the following terms shall have the following
meanings:

“Accounts” shall have
the meaning set forth in Article 9 of the New York UCC.

“Article” means a
numbered article of this Security Agreement, unless another document is
specifically referenced.

“Chattel Paper” shall
have the meaning set forth in Article 9 of the New York UCC.

 

“Collateral” all
Accounts, Chattel Paper, Commercial Tort Claims, Copyrights, Deposit Accounts,
Documents, Equipment, Farm Products, Fixtures, General Intangibles, Goods,
Instruments, Inventory, Investment Property, letters of credit,
Letter-of-Credit Rights, Licenses, Patents, Pledged Deposits, Supporting
Obligations, Trademarks and Other Collateral, wherever located, in which any
Grantor now has or hereafter acquires any right or interest, and the proceeds
(including Stock Rights), insurance proceeds and products thereof, together
with all books and records, customer lists, credit files, computer files,
programs, printouts and other computer materials and records related thereto; provided
that, notwithstanding the foregoing, Collateral shall expressly exclude the
Excluded Collateral.

“Commercial Tort Claims”
means those certain currently existing commercial tort claims, as defined in
the New York UCC of any Grantor, including each commercial tort claim specifically
described in Exhibit “F”.

“Control” shall have
the meaning set forth in Article 8 or, if applicable, in Section 9-104, 9-105,
9-106 or 9-107 of Article 9 of the New York UCC.

“Copyrights” means,
with respect to any Person, all of such Person’s right, title, and interest in
and to the following:  (a) all
copyrights, rights and interests in copyrights, works protectable by copyright,
copyright registrations, and copyright applications; (b) all extensions of any
of the foregoing; (c) all income, royalties, damages, and payments now or
hereafter due and/or payable under any of the foregoing, including, without
limitation, damages or payments for past or future infringements for any of the
foregoing; (d) the right to sue for past, present, and future infringements of
any of the foregoing; and (e) all rights corresponding to any of the foregoing
throughout the world.

“Default” means an
event described in Section 5.1 hereof.

“Deposit Accounts”
shall have the meaning set forth in Article 9 of the New York UCC.

“Documents” shall
have the meaning set forth in Article 9 of the New York UCC.

“Equipment” shall
have the meaning set forth in Article 9 of the New York UCC.

“Exhibit” refers to a
specific exhibit to this Security Agreement, unless another document is
specifically referenced.

“Excluded Collateral”
means (i) any fee owned real property with a book value of less than $5,000,000
and all leasehold interests; (ii) motor vehicles and other assets subject to
certificates of title; (iii) pledges and security interests prohibited by law
and agreements permitted under the Loan Documents (including liens, leases and
licenses permitted under the Loan Documents); (iv) assets specifically
requiring perfection through control agreements (e.g., deposit accounts and securities
accounts); (v) assets to the extent a security interest in such assets would
result in material adverse tax consequences; (vi) those assets as to which the
Administrative Agent in consultation with the Borrower reasonably determines
that the burden or cost of obtaining such a security interest, pledge or
perfection thereof outweighs the benefit to the Lenders of the security to be
afforded thereby and (vii) the outstanding voting stock of any Foreign
Subsidiary to the extent a pledge thereof would cause a Deemed Dividend
Problem.

“Farm Products” shall
have the meaning set forth in Article 9 of the New York UCC.

“Fixtures” shall have
the meaning set forth in Article 9 of the New York UCC.

 

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“General Intangibles”
shall have the meaning set forth in Article 9 of the New York UCC and, in any
event, includes payment intangibles, contract rights, rights to payment, rights
arising under common law, statutes, or regulations, choses or things in action,
goodwill (including the goodwill associated with any Trademark), Patents,
Trademarks, Copyrights, URLs and domain names, Industrial Designs, other
industrial or Intellectual Property or rights therein or applications therefor,
whether under license or otherwise, programs, programming materials,
blueprints, drawings, purchase orders, customer lists, monies due or
recoverable from pension funds, route lists, rights to payment and other rights
under any royalty or licensing agreements, including Intellectual Property
Licenses, infringement claims, computer programs, information contained on
computer disks or tapes, software, literature, reports, catalogs, pension plan
refunds, pension plan refund claims, insurance premium rebates, tax refunds,
and tax refund claims, interests in a partnership or limited liability company
which do not constitute a security under Article 8 of the Code, and any other
personal property other than Commercial Tort Claims, money, Accounts, Chattel
Paper, Deposit Accounts, Goods, Investment Related Property, negotiable
Collateral, and oil, gas, or other minerals before extraction.

“Goods” shall have
the meaning set forth in Article 9 of the New York UCC.

“Industrial Designs”
means (i) registered industrial designs and industrial design applications, and
also includes registered industrial designs and industrial design applications
listed on Exhibit “B”, (ii) all renewals, divisions and any industrial
design registrations issuing thereon and any and all foreign applications
corresponding thereto, (iii) all income, royalties, damages and payments now
and hereafter due or payable under and with respect thereto, including payments
under all licenses entered into in connection therewith and damages and
payments for past or future infringements thereof, (iv) the right to sue for
past, present and future infringements thereof, and (v) all of each Grantor’s
rights corresponding thereto throughout the world.

“Instruments” shall
have the meaning set forth in Article 9 of the New York UCC.

“Intellectual Property”
means all Patents, Trademarks, Copyrights and any other intellectual property.

“Inventory” shall
have the meaning set forth in Article 9 of the New York UCC.

“Investment Property”
shall have the meaning set forth in Article 9 of the New York UCC.

“Letter of Credit Rights”
shall have the meaning set forth in Article 9 of the New York UCC.

“Licenses” means,
with respect to any Person, all of such Person’s right, title, and interest in
and to (a) any and all licensing agreements or similar arrangements in and to
its Patents, Copyrights, or Trademarks, (b) all income, royalties, damages,
claims, and payments now or hereafter due or payable under and with respect
thereto, including, without limitation, damages and payments for past and
future breaches thereof, and (c) all rights to sue for past, present, and
future breaches thereof.

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

“Other Collateral”
means any property of the Grantors, not included within the defined terms
Accounts, Chattel Paper, Commercial Tort Claims, Copyrights, Deposit Accounts,
Documents, Equipment, Fixtures, Farm Products, General Intangibles, Goods,
Instruments, Inventory, Investment Property, Letter-of-Credit Rights, Licenses,
Patents, Pledged Deposits, Supporting Obligations and Trademarks, including,
without limitation, all cash on hand, letters of credit, Stock Rights or any
other 

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deposits
(general or special, time or demand, provisional or final) with any bank or
other financial institution, it being intended that the Collateral include all
real and personal property of the Grantors.

“Patents” means, with
respect to any Person, all of such Person’s right, title, and interest in and
to: (a) any and all patents and patent applications; (b) all inventions and
improvements described and claimed therein; (c) all reissues, divisions,
continuations, extensions, and continuations-in-part thereof; (d) all income,
royalties, damages, claims, and payments now or hereafter due or payable under
and with respect thereto, including, without limitation, damages and payments
for past and future infringements thereof; (e) all rights to sue for past,
present, and future infringements thereof; and (f) all rights corresponding to
any of the foregoing throughout the world.

“Pledged Deposits”
means all time deposits of money (other than Deposit Accounts and Instruments),
whether or not evidenced by certificates, which a Grantor may from time to time
designate as pledged to the Administrative Agent or to any Holder of Secured
Obligations as security for any Secured Obligations, and all rights to receive
interest on said deposits.

“Receivables” means
the Accounts, Chattel Paper, Documents, Investment Property, Instruments or
Pledged Deposits, and any other rights or claims to receive money which are
General Intangibles or which are otherwise included as Collateral.

“Section” means a
numbered section of this Security Agreement, unless another document is
specifically referenced.

“Security” has the
meaning set forth in Article 8 of the New York UCC.

“Stock Rights” means
any securities, dividends or other distributions and any other right or
property which any Grantor shall receive or shall become entitled to receive
for any reason whatsoever with respect to, in substitution for or in exchange
for any securities or other ownership interests in a corporation, partnership,
joint venture or limited liability company constituting Collateral and any
securities, any right to receive securities and any right to receive earnings,
in which any Grantor now has or hereafter acquires any right, issued by an
issuer of such securities.

“Supporting Obligation”
shall have the meaning set forth in Article 9 of the New York UCC.

“Trademarks” means,
with respect to any Person, all of such Person’s right, title, and interest in
and to the following:  (a) all trademarks
(including service marks), trade names, trade dress, and trade styles and the
registrations and applications for registration thereof and the goodwill of the
business symbolized by the foregoing; (b) all licenses of the foregoing,
whether as licensee or licensor; (c) all renewals of the foregoing; (d) all
income, royalties, damages, and payments now or hereafter due or payable with
respect thereto, including, without limitation, damages, claims, and payments
for past and future infringements thereof; (e) all rights to sue for past,
present, and future infringements of the foregoing, including the right to
settle suits involving claims and demands for royalties owing; and (f) all
rights corresponding to any of the foregoing throughout the world.

The foregoing definitions
shall be equally applicable to both the singular and plural forms of the
defined terms.

 

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ARTICLE
II

GRANT OF SECURITY INTEREST

Each of the Grantors hereby
pledges, assigns and grants to the Administrative Agent, on behalf of and for
the ratable benefit of the Holders of Secured Obligations and (to the extent
specifically provided herein) their Affiliates, a security interest in all of
such Grantor’s right, title and interest, whether now owned or hereafter
acquired, in and to the Collateral to secure the prompt and complete payment
and performance of the Secured Obligations. 
For the avoidance of doubt, the grant of a security interest herein
shall not be deemed to be an assignment of intellectual property rights owned
by the Grantors.

ARTICLE
III

REPRESENTATIONS AND WARRANTIES

Each of the Initial Grantors
represents and warrants to the Administrative Agent and the Holders of Secured
Obligations, and each Grantor that becomes a party to this Security Agreement
pursuant to the execution of a Security Agreement Supplement in substantially
the form of Annex I represents and warrants (after giving effect to
supplements to each of the Exhibits hereto with respect to such subsequent
Grantor as attached to such Security Agreement Supplement), that:

3.1.          Title,
Authorization, Validity and Enforceability.  Such Grantor has good and valid rights in or
the power to transfer the Collateral owned by it and title to the Collateral
with respect to which it has purported to grant a security interest hereunder,
free and clear of all Liens except for Liens permitted under Section 4.1.3
hereof, and has full corporate, limited liability company or partnership, as
applicable, power and authority to grant to the Administrative Agent the
security interest in such Collateral pursuant hereto.  The execution and delivery by such Grantor of
this Security Agreement have been duly authorized by proper corporate, limited
liability company or partnership, as applicable, proceedings, and this Security
Agreement constitutes a legal, valid and binding obligation of such Grantor and
creates a security interest which is enforceable against such Grantor in all
Collateral it now owns or hereafter acquires, except as enforceability may be
limited by (i) bankruptcy, insolvency, fraudulent conveyance, reorganization or
similar laws relating to or affecting the enforcement of creditors’ rights
generally, (ii) general equitable principles (whether considered in a
proceeding in equity or at law), and (iii) requirements of reasonableness, good
faith and fair dealing.  When financing
statements have been filed in the appropriate offices against such Grantor in
the locations listed on Exhibit “E”, the Administrative Agent will have
a fully perfected first priority security interest in the Collateral owned by
such Grantor in which a security interest may be perfected by filing of a
financing statement under the UCC, subject only to Liens permitted under Section
4.1.3 hereof.

3.2.          Conflicting
Laws and Contracts. 
Neither the execution and delivery by such Grantor of this Security
Agreement, the creation and perfection of the security interest in the
Collateral granted hereunder, nor compliance with the terms and provisions
hereof will violate (i) any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on such Grantor, or (ii) such Grantor’s
charter, articles, partnership agreement or by-laws (or similar constitutive
documents), or (iii) the provisions of any indenture, instrument or agreement
to which such Grantor is a party or is subject, or by which it, or its property
may be bound or affected, or conflict with or constitute a default thereunder,
or result in or require the creation or imposition of any Lien in, of or on the
property of such Grantor pursuant to the terms of any such indenture,
instrument or agreement (other than any Lien of the Administrative Agent on
behalf of the Holders of Secured Obligations).

 

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3.3.          Principal
Location.  Such Grantor’s
mailing address and the location of its place of business (if it has only one)
or its chief executive office (if it has more than one place of business), is
disclosed in Exhibit “A”.

3.4.          No
Other Names; Etc.. 
Within the last five (5) years, such Grantor has not conducted business
under any name, changed its jurisdiction of formation, merged with or into or
consolidated with any other corporation, except as disclosed in Exhibit A.  The name in which such Grantor has executed
this Security Agreement is the exact name as it appears in such Grantor’s
organizational documents, as amended, as filed with such Grantor’s jurisdiction
of organization as of the Effective Date.

3.5.          Accounts
and Chattel Paper.  The
names of the obligors, amounts owing, due dates and other information with
respect to the Accounts and Chattel Paper owned by such Grantor are and will be
correctly stated in all records of such Grantor relating thereto.

3.6.          Filing
Requirements.  None of
the Collateral owned by such Grantor is of a type for which security interests
or liens may be perfected by filing under any federal statute except for
Patents, Trademarks and Copyrights held by such Grantor and described in Exhibit
“B”.  The legal description, county
and street address of the property on which any Fixtures with a fair market
value in excess of $1,000,000 owned by such Grantor are located is set forth in
Exhibit “C” together with the name and address of the record owner of
each such property.

3.7.          No
Financing Statements. 
No financing statement describing all or any portion of the Collateral
which has not lapsed or been terminated naming such Grantor as debtor has been
filed in any jurisdiction except financing statements (i) naming the
Administrative Agent on behalf of the Holders of Secured Obligations as the
secured party and (ii) in respect of Liens permitted by Section 6.02 of the
Credit Agreement; provided, that, except as contemplated by Section
9.02(d) of the Credit Agreement, nothing herein shall be deemed to constitute
an agreement to subordinate any of the Liens of the Administrative Agent under
the Loan Documents to any Liens otherwise permitted under Section 6.02 of the
Credit Agreement.

3.8.          Federal
Employer Identification Number; State Organization Number; Jurisdiction of
Organization.  Such
Grantor’s federal employer identification number is, and if such Grantor is a
registered organization, such Grantor’s State of organization, type of
organization and State of organization identification number and is listed on Exhibit
“G”.

3.9.          Pledged
Securities and Other Investment Property.  Exhibit “D” sets forth a complete and
accurate list of the Instruments, Securities and other Investment Property
delivered to the Administrative Agent. 
Each Grantor is the direct and beneficial owner of each Instrument,
Security and other type of Investment Property listed on Exhibit “D” as
being owned by it, free and clear of any Liens, except for the security
interest granted to the Administrative Agent for the benefit of the Holders of
Secured Obligations hereunder or as permitted by Section 6.02 of the Credit
Agreement.  Each Grantor further represents
and warrants that (i) all such Instruments, Securities or other types of
Investment Property which are shares of stock in a corporation or ownership
interests in a partnership or limited liability company constitute the
percentage of the issued and outstanding shares of stock (or other equity
interests) of the respective issuers thereof indicated on Exhibit “D”
hereto and (ii) with respect to any certificates delivered to the
Administrative Agent representing an ownership interest in a partnership or
limited liability company, either such certificates are Securities as defined
in Article 8 of the New York UCC of the applicable jurisdiction as a result of
actions by the issuer or otherwise, or, if such certificates are not
Securities, such Grantor has so informed the Administrative Agent so that the
Administrative Agent may take steps to perfect its security interest therein as
a General Intangible.

 

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3.10.        Intellectual Property.

3.10.1  Exhibit “B” contains a complete and
accurate listing as of the Effective Date of all material Intellectual
Property, including, but not limited to the following: (i) state, U.S. and
foreign trademark registrations, applications for trademark registration and
material common law trademarks, (ii) U.S. and foreign patents and patents
applications, together with all reissuances, continuations, continuations in
part, revisions, extensions, and reexaminations thereof, (iii) U.S. and foreign
copyright registrations and applications for registration, (iv) foreign
industrial design registrations and industrial design applications, (v) domain
names, (vi) material proprietary computer software, and (vii) all forms of
Intellectual Property described in clauses (i)-(iii) above that are owned by a
third party and licensed to the Grantors or otherwise used by the Grantors
under contract except where the inability to use such Intellectual Property
could not be reasonably expected to result in a Material Adverse Effect.  All of the U.S. registrations, applications
for registration or applications for issuance of the Intellectual Property are
valid and subsisting, in good standing and are recorded or is in the process of
being recorded in the name of the applicable Grantor.

3.10.2  On the Effective Date, the Intellectual
Property scheduled on Exhibit B, which is registered with a Governmental
Authority, is valid, subsisting and enforceable and has not been abandoned or
adjudged invalid or unenforceable, in whole or in part except as could not be
reasonably expected to result in a Material Adverse Effect.  Each Grantor has good, marketable and
exclusive title to, and the valid and enforceable power and right to sell,
license, transfer, distribute, use and otherwise exploit, such Intellectual Property.

3.10.3  To each Grantor’s knowledge, on the Effective
Date, no Person has violated, infringed upon or breached, or is currently
violating, infringing upon or breaching, any of the rights of the Grantors to
the Intellectual Property or has breached or is breaching any duty or
obligation owed to the Grantors in respect of the Intellectual Property except
where those breaches, individually or in the aggregate, could not be reasonably
expected to result in a Material Adverse Effect.

3.10.4  On the Effective Date, no settlement or
consents, covenants not to sue, nonassertion assurances, or releases have been
entered into by any Grantor or to which any Grantor is bound that adversely
affects its rights to own or use any Intellectual Property except as could not
be reasonably expected to result in a Material Adverse Effect, in each case
individually or in the aggregate.

3.10.5  On the Effective Date, no Grantor has
received any written notice that remains outstanding challenging the validity,
enforceability, or ownership of any Intellectual Property except where those
challenges could not reasonably be expected to result in a Material Adverse
Effect, and to such Grantor’s knowledge at the date hereof there are no facts
upon which such a challenge could be made.

3.10.6  On the Effective Date, the consummation of
the transactions contemplated by Loan Documents will not result in the
termination or material impairment of any of the Intellectual Property which
termination could reasonably be expected to have a Material Adverse Effect.

 

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ARTICLE
IV

COVENANTS

From the date of this
Security Agreement and thereafter until this Security Agreement is terminated,
each of the Initial Grantors agrees, and from and after the effective date of
any Security Agreement Supplement applicable to any Grantor (and after giving
effect to supplements to each of the Exhibits hereto with respect to such
subsequent Grantor as attached to such Security Agreement Supplement) and
thereafter until this Security Agreement is terminated each such subsequent
Grantor agrees:

4.1.          General.

4.1.1  Financing Statements and Other Actions; Defense of Title.  Each Grantor hereby authorizes the
Administrative Agent to file, and if requested will execute and deliver to the
Administrative Agent, all financing statements describing the Collateral owned
by such Grantor and other documents and take such other actions as may from
time to time reasonably be requested by the Administrative Agent in order to
maintain a first priority, perfected security interest in and, if applicable,
Control of, the Collateral owned by such Grantor, subject to Liens permitted
under Section 6.02 of the Credit Agreement, provided that, except as
contemplated by Section 9.02(d) of the Credit Agreement, nothing herein shall
be deemed to constitute an agreement to subordinate any of the Liens of the
Administrative Agent under the Loan Documents to any Liens otherwise permitted
under Section 6.02 of the Credit Agreement. 
Such financing statements may describe the Collateral in the same manner
as described herein or may contain an indication or description of collateral
that describes such property in any other manner as the Administrative Agent
may determine, in its sole discretion, is necessary, advisable or prudent to
ensure that the perfection of the security interest in the Collateral granted
to the Administrative Agent herein, including, without limitation, describing
such property as “all assets” or “all personal property, whether now owned or
hereafter acquired.”  Each Grantor will
take any and all actions necessary to defend title to the Collateral owned by
such Grantor against all persons and to defend the security interest of the
Administrative Agent in such Collateral and the priority thereof against any
Lien not expressly permitted hereunder.

4.1.2  Disposition of Collateral.  No Grantor will sell, lease or otherwise
dispose of the Collateral owned by such Grantor except dispositions permitted
pursuant to Section 6.03 of the Credit Agreement.

4.1.3  Liens. 
No Grantor will create, incur, or suffer to exist any Lien on the
Collateral owned by such Grantor except Liens permitted pursuant to Section
6.02 of the Credit Agreement, provided, that,  except as contemplated by Section 9.02(d) of
the Credit Agreement, nothing herein shall be deemed to constitute an agreement
to subordinate any of the Liens of the Administrative Agent under the Loan
Documents to any Liens otherwise permitted under Section 6.02 of the Credit
Agreement.

4.1.4  Change in Corporate Existence, Type or Jurisdiction of
Organization, Location, Name. 
Each Grantor will:

(i)                                     preserve its
existence and corporate structure as in effect on the Effective Date;

(ii)                                  not change its
jurisdiction of organization; and

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(iii)                               not maintain
its place of business (if it has only one) or its chief executive office (if it
has more than one place of business) at a location other than a location
specified on Exhibit “A”.

unless, in each such case,
such Grantor shall have given the Administrative Agent not less than 30 days’
prior written notice of such event or occurrence and the Administrative Agent
shall have either (x) determined that such event or occurrence will not
adversely affect the validity, perfection or priority of the Administrative
Agent’s security interest in the Collateral, or (y) taken such steps (with the
cooperation of such Grantor to the extent necessary or advisable) as are
necessary or advisable to properly maintain the validity, perfection and
priority of the Administrative Agent’s security interest in the Collateral
owned by such Grantor.

4.1.5  Other Financing Statements.  No Grantor will suffer to exist or authorize
the filing of any financing statement naming it as debtor covering all or any
portion of the Collateral owned by such Grantor, except any financing statement
authorized under Section 4.1.1 hereof.

4.2.          Receivables.

4.2.1  Certain Agreements on Receivables.  During the occurrence and continuation of an
Event of Default and after notice from the Administrative Agent, no Grantor
will make or agree to make any discount, credit, rebate or other reduction in
the original amount owing on a Receivable or accept in satisfaction of a
Receivable less than the original amount thereof.  Prior to the occurrence and continuation of a
Default, such Grantor may reduce the amount of Accounts arising from the sale
of Inventory or the rendering of services in accordance with its policies and
in the ordinary course of business and as otherwise permitted under the Credit
Agreement.

4.2.2  Collection of Receivables.  Except as otherwise provided in this Security
Agreement, each Grantor will endeavor in accordance with reasonable business
practices to cause to be collected from the account debtor named in each of its
Accounts or obligor under any contract and enforce in accordance with generally
accepted lawful collection procedures, at such Grantor’s sole expense, all
amounts due or hereafter due to such Grantor under the Receivables owned by
such Grantor.

4.2.3  Delivery of Invoices.  Each Grantor will deliver to the
Administrative Agent promptly upon its request after the occurrence of an Event
of Default duplicate invoices with respect to each Account owned by such
Grantor bearing such language of assignment as the Administrative Agent shall
specify.

4.3.          Maintenance
of Goods.  Each Grantor
will do all things necessary to maintain, preserve, protect and keep the
Inventory and the Equipment owned by such Grantor in good repair, working order
and saleable condition (ordinary wear and tear excepted) and make all necessary
and proper repairs, renewals and replacements so that its business carried on
in connection therewith may be properly conducted at all times, except where
the failure to do so, individually or in the aggregate, could not reasonably be
expected to have a Material Adverse Effect.

4.4.          Instruments,
Securities, Chattel Paper, Documents and Pledged Deposits.  Each Grantor will (i) deliver to the
Administrative Agent promptly upon execution of this Security Agreement the
originals of all Chattel Paper, Securities (to the extent certificated) and
Instruments constituting Collateral (if any then exist) with a principal amount
in excess of $1,000,000 (provided that such Dollar threshold shall not apply to
Securities and Instruments constituting Investment Property representing Equity
Interests in Subsidiaries), (ii) hold in trust for the Administrative Agent
upon receipt and immediately 

 

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thereafter deliver to the
Administrative Agent any Chattel Paper, Securities and Instruments constituting
Collateral, (iii) upon the designation of any Pledged Deposits (as set forth in
the definition thereof), deliver to the Administrative Agent such Pledged
Deposits which are evidenced by certificates included in the Collateral
endorsed in blank, marked with such legends and assigned as the Administrative
Agent shall specify, and (iv) upon the Administrative Agent’s request, after
the occurrence and during the continuance of an Event of Default, deliver to
the Administrative Agent (and thereafter hold in trust for the Administrative
Agent upon receipt and immediately deliver to the Administrative Agent) any
Document evidencing or constituting Collateral.

4.5.          Uncertificated
Securities and Certain Other Investment Property.  Each Grantor will permit the Administrative
Agent from time to time to cause the appropriate issuers (and, if held with a
securities intermediary, such securities intermediary) of uncertificated
securities or other types of Investment Property not represented by
certificates which are Collateral owned by such Grantor to mark their books and
records with the numbers and face amounts of all such uncertificated securities
or other types of Investment Property not represented by certificates and all
rollovers and replacements therefor to reflect the Lien of the Administrative
Agent granted pursuant to this Security Agreement.  Each Grantor will use all commercially
reasonable efforts, with respect to Investment Property constituting Collateral
owned by such Grantor held with a financial intermediary, to cause such
financial intermediary to enter into a control agreement with the
Administrative Agent in form and substance reasonably satisfactory to the
Administrative Agent.

4.6.          Stock
and Other Ownership Interests.

4.6.1  Changes in Capital Structure of Issuers.  Except as permitted in the Credit Agreement,
no Grantor will (i) permit or suffer any issuer of privately held corporate
securities or other ownership interests in a corporation, partnership, joint
venture or limited liability company constituting Collateral owned by such
Grantor to dissolve, liquidate, retire any of its capital stock or other
Instruments or Securities evidencing ownership, reduce its capital or merge or
consolidate with any other entity, or (ii) vote any of the Instruments,
Securities or other Investment Property in favor of any of the foregoing except
to the extent permitted under Section 6.03 of the Credit Agreement.

4.6.2  Registration of Pledged Securities and other Investment
Property.  Each Grantor
will permit any registrable Collateral owned by such Grantor to be registered
in the name of the Administrative Agent or its nominee at any time at the
option of the Required Lenders following the occurrence and during the
continuance of an Event of Default and without any further consent of such
Grantor.

4.6.3  Exercise of Rights in Pledged Securities and other
Investment Property. 
Each Grantor will permit the Administrative Agent or its nominee at any
time after the continuance of an Event of Default, without notice, to exercise
or refrain from exercising any and all voting and other consensual rights
pertaining to the Collateral owned by such Grantor or any part thereof, and to
receive all dividends and interest in respect of such Collateral.

4.7.          Letter-of-Credit
Rights.  Each Grantor
will, upon the Administrative Agent’s request, cause each issuer of a letter of
credit with a face amount in excess of $1,000,000, to consent to the assignment
of proceeds of the letter of credit in order to give the Administrative Agent
Control of the letter-of-credit rights to such letter of credit.

4.8.          Federal,
State or Municipal Claims. 
Each Grantor will notify the Administrative Agent of any Collateral
owned by such Grantor which constitutes a claim against the United States
government 

 

10

or any state or local
government or any instrumentality or agency thereof, the assignment of which
claim is restricted by federal, state or municipal law.

4.9.          Intellectual Property.

4.9.1  If, after the date hereof, any Grantor
obtains rights to, including, but not limited to filing and acceptance of a
statement of use or an amendment to allege use with the U.S. Patent and
Trademark Office, or applies for or seeks registration of, any new patentable
invention, Trademark or Copyright in addition to the Patents, Trademarks and
Copyrights described in Part C of Exhibit “B”,  which are all of such Grantor’s Patents, Trademarks
and Copyrights as of the Effective Date, then such Grantor shall give the
Administrative Agent notice thereof, as part of each compliance certificate
provided to the Administrative Agent pursuant to the Credit Agreement.  Each Grantor agrees promptly upon request by
the Administrative Agent to execute and deliver to the Administrative Agent any
supplement to this Security Agreement or any other document reasonably
requested by the Administrative Agent to evidence such security interest in a
form appropriate for recording in the applicable federal office.  Each Grantor also hereby authorizes the
Administrative Agent to modify this Security Agreement unilaterally for the
sole purpose of (i) amending Part C of Exhibit “B”  to include any future Patents, Trademarks and/or
Copyrights of which the Administrative Agent receives notification from such
Grantor pursuant hereto and (ii) recording, in addition to and not in
substitution for this Security Agreement, a duplicate original of this Security
Agreement containing in Part C of Exhibit “B” a description of such future Patents, Trademarks
and/or Copyrights.

4.9.2  As of the Effective Date, no Grantor has any
interest in, or title to, any registered Copyrights, material Intellectual
Property Licenses, Patents, or registered Trademarks except as set forth on  Exhibit “B”.  This Agreement is effective to create a valid and
continuing Lien on such registered Copyrights, material Intellectual Property
Licenses, Patents, or registered Trademarks and, upon filing of the
Confirmatory Grant of Security Interest in Copyrights with the United States
Copyright Office and filing of the Confirmatory Grant of Security Interest in
Patents with the United States Patent and Trademark Office, and the filing of
appropriate financing statements in the jurisdictions listed on Exhibit “E”  hereto, all action necessary or desirable
to protect and perfect the security interest in, to and on each Grantor’s
Patents, registered Trademarks, or registered Copyrights has been taken and
such perfected security interest is enforceable as such as against any and all
creditors of and purchasers from any Grantor. 
No Grantor has any interest in any registered Copyright that is
necessary in connection with the operation of such Grantor’s business, except
for those registered Copyrights identified on Exhibit “B”  attached hereto which have been
registered with the United States Copyright Office.

4.10.        Commercial Tort Claims.  If, after the date hereof, any Grantor
identifies the existence of a commercial tort claim in an amount in excess of
$1,000,000 belonging to such Grantor that has arisen in the course of such
Grantor’s business in addition to the commercial tort claims described in  Exhibit “F”, which are all of such Grantor’s commercial
tort claims as of the Effective Date, then such Grantor shall give the
Administrative Agent prompt notice thereof, but in any event not less
frequently than quarterly.  Each Grantor
agrees promptly upon request by the Administrative Agent to execute and deliver
to the Administrative Agent any supplement to this Security Agreement or any
other document reasonably requested by the Administrative Agent to evidence the
grant of a security interest therein in favor of the Administrative Agent.

 

11

 

ARTICLE
V

DEFAULT

5.1.          Default.  The
occurrence of any “Default” and “Event of Default” under, and as defined in,
the Credit Agreement shall constitute a Default and Event of Default,
respectively, hereunder.

5.2.          Acceleration
and Remedies.  Upon the
acceleration of the Obligations under the Credit Agreement pursuant to Article
VII thereof, the Obligations under the Credit Agreement and, to the extent
provided for under the Swap Agreements and the Banking Services Agreements
evidencing the same, the Swap Obligations and the Banking Services Obligations,
shall immediately become due and payable without presentment, demand, protest
or notice of any kind, all of which are hereby expressly waived, and the
Administrative Agent may, with the concurrence or at the direction of the
Required Lenders, exercise any or all of the following rights and remedies:

5.2.1  Those rights and remedies provided in this
Security Agreement, the Credit Agreement, or any other Loan Document, provided that
this Section 5.2.1 shall not be understood to limit any rights or
remedies available to the Administrative Agent and the Holders of Secured
Obligations prior to a Default.

5.2.2  Those rights and remedies available to a
secured party under the New York UCC (whether or not the New York UCC applies
to the affected Collateral) or under any other applicable law (including,
without limitation, any law governing the exercise of a bank’s right of setoff
or bankers’ lien) when a debtor is in default under a security agreement.

5.2.3  Without notice except as specifically
provided in Section 8.1 hereof or elsewhere herein, sell, lease, assign,
grant an option or options to purchase or otherwise dispose of the Collateral
or any part thereof in one or more parcels at public or private sale, for cash,
on credit or for future delivery, and upon such other terms as the
Administrative Agent may deem commercially reasonable.

The Administrative Agent, on
behalf of the secured parties, may comply with any applicable state or federal
law requirements in connection with a disposition of the Collateral, and such
compliance will not be considered to adversely affect the commercial
reasonableness of any sale of the Collateral.

If, after the Credit
Agreement has terminated by its terms and all of the Secured Obligations have
been paid in full, there remain outstanding Swap Obligations or Banking
Services Obligations, the Required Lenders may exercise the remedies provided
in this Section 5.2 upon the occurrence of any event which would allow
or require the termination or acceleration of any Swap Obligations or Banking
Services Obligations.

5.3.          Grantors’
Obligations Upon Default. 
Upon the request of the Administrative Agent after the occurrence of a
Default, each Grantor will:

5.3.1  Assembly of Collateral.  Assemble and make available to the
Administrative Agent the Collateral and all records relating thereto at any
place or places specified by the Administrative Agent.

5.3.2  Secured Party Access.  Permit the Administrative Agent, by the
Administrative Agent’s representatives and agents, to enter any premises where
all or any part of the Collateral, 

 

 

12

or the books and records
relating thereto, or both, are located, to take possession of all or any part
of the Collateral and to remove all or any part of the Collateral.

5.4.          License.  The
Administrative Agent is hereby granted a license or other right to use,
following the occurrence and during the continuance of a Default, without
charge, each Grantor’s labels, patents, copyrights, rights of use of any name,
trade secrets, trade names, trademarks, service marks, customer lists and
advertising matter, or any property of a similar nature, as it pertains to the
Collateral, in completing production of, advertising for sale, and selling any
Collateral, and, following the occurrence and during the continuance of a
Default, such Grantor’s rights under all licenses and all franchise agreements
shall inure to the Administrative Agent’s benefit.  In addition, each Grantor hereby irrevocably
agrees that the Administrative Agent may, following the occurrence and during
the continuance of a Default, sell any of such Grantor’s Inventory directly to
any person, including without limitation persons who have previously purchased
such Grantor’s Inventory from such Grantor and in connection with any such sale
or other enforcement of the Administrative Agent’s rights under this Security
Agreement, may sell Inventory which bears any trademark owned by or licensed to
such Grantor and any Inventory that is covered by any copyright owned by or
licensed to such Grantor and the Administrative Agent may finish any work in
process and affix any trademark owned by or licensed to such Grantor and sell
such Inventory as provided herein.

ARTICLE
VI

WAIVERS, AMENDMENTS AND REMEDIES

No delay or omission of the
Administrative Agent or any Holder of Secured Obligations to exercise any right
or remedy granted under this Security Agreement shall impair such right or
remedy or be construed to be a waiver of any Default or an acquiescence
therein, and any single or partial exercise of any such right or remedy shall
not preclude any other or further exercise thereof or the exercise of any other
right or remedy.  No waiver, amendment or
other variation of the terms, conditions or provisions of this Security
Agreement whatsoever shall be valid unless in writing signed by the
Administrative Agent with the concurrence or at the direction of the (a)  Required Lenders and (b) each Grantor, and
then only to the extent in such writing specifically set forth, provided that
the addition of any Domestic Subsidiary as a Grantor hereunder by execution of
a Security Agreement Supplement in the form of Annex I (with such
modifications as shall be acceptable to the Administrative Agent) shall not
require receipt of any consent from or execution of any documentation by any
other Grantor party hereto.  All rights
and remedies contained in this Security Agreement or by law afforded shall be
cumulative and all shall be available to the Administrative Agent and the
Holders of Secured Obligations until the Secured Obligations have been paid in
full.

ARTICLE
VII

PROCEEDS; COLLECTION OF RECEIVABLES

7.1.          Lockboxes.  Upon request of the Administrative Agent
after the occurrence and during the continuance of an Event of Default, each
Grantor shall execute and deliver to the Administrative Agent irrevocable
lockbox agreements in the form provided by or otherwise reasonably acceptable
to the Administrative Agent, which agreements shall be accompanied by an
acknowledgment by the bank where the lockbox is located of the Lien of the
Administrative Agent granted hereunder and of irrevocable instructions to wire
all amounts collected therein to a special collateral account at the Administrative
Agent.

 

13

7.2.          Collection
of Receivables.  The
Administrative Agent may at any time after the occurrence of a Default, by
giving each Grantor written notice, elect to require that the Receivables be
paid directly to the Administrative Agent for the benefit of the Holders of
Secured Obligations.  In such event, each
Grantor shall, and shall permit the Administrative Agent to, promptly notify
the account debtors or obligors under the Receivables owned by such Grantor of
the Administrative Agent’s interest therein and direct such account debtors or
obligors to make payment of all amounts then or thereafter due under such
Receivables directly to the Administrative Agent.  Upon receipt of any such notice from the
Administrative Agent, each Grantor shall thereafter hold in trust for the
Administrative Agent, on behalf of the Holders of Secured Obligations, all
amounts and proceeds received by it with respect to the Receivables and Other
Collateral and promptly and at all times thereafter deliver to the
Administrative Agent all such amounts and proceeds in the same form as so
received, whether by cash, check, draft or otherwise, with any necessary
endorsements.  The Administrative Agent
shall hold and apply funds so received as provided by the terms of Sections
7.3 and 7.4 hereof.

7.3.          Special
Collateral Account. 
The Administrative Agent may require all cash proceeds of the Collateral
to be deposited in a special non-interest bearing cash collateral account with
the Administrative Agent and held there as security for the Secured
Obligations.  No Grantor shall have any
control whatsoever over said cash collateral account.  If no Default has occurred or is continuing,
the Administrative Agent shall from time to time deposit the collected balances
in said cash collateral account into the applicable Grantor’s general operating
account with the Administrative Agent. 
If any Event of Default has occurred and is continuing, the
Administrative Agent may (and shall, at the direction of the Required Lenders),
from time to time, apply the collected balances in said cash collateral account
to the payment of the Secured Obligations whether or not the Secured
Obligations shall then be due.

7.4.          Application
of Proceeds.  The
proceeds of the Collateral shall be applied by the Administrative Agent to
payment of the Secured Obligations as provided under Section 2.18 of the
Credit Agreement.

ARTICLE
VIII

GENERAL PROVISIONS

8.1.          Notice
of Disposition of Collateral; Condition of Collateral.  Each Grantor hereby waives notice of the time
and place of any public sale or the time after which any private sale or other
disposition of all or any part of the Collateral may be made.  To the extent such notice may not be waived
under applicable law, any notice made shall be deemed reasonable if sent to the
Borrower, addressed as set forth in Article IX, at least ten (10) days
prior to (i) the date of any such public sale or (ii) the time after which any
such private sale or other disposition may be made.  The Administrative Agent shall have no
obligation to clean-up or otherwise prepare the Collateral for sale.

8.2.          Compromises
and Collection of Collateral. 
Each Grantor and the Administrative Agent recognize that setoffs,
counterclaims, defenses and other claims may be asserted by obligors with
respect to certain of the Receivables, that certain of the Receivables may be
or become uncollectible in whole or in part and that the expense and
probability of success in litigating a disputed Receivable may exceed the
amount that reasonably may be expected to be recovered with respect to a
Receivable.  In view of the foregoing,
each Grantor agrees that the Administrative Agent may at any time and from time
to time, if an Event of Default has occurred and is continuing, compromise with
the obligor on any Receivable, accept in full payment of any Receivable such
amount as the Administrative Agent in its sole discretion shall determine or
abandon any Receivable, and any such action by the Administrative Agent shall
be commercially reasonable so long as the Administrative Agent acts in good
faith based on information known to it at the time it takes any such action.

 

14

8.3.          Secured
Party Performance of Grantor’s Obligations.  Without having any obligation to do so, if a
Grantor fails to do so after notice by the Administrative Agent, the
Administrative Agent may perform or pay any obligation which any Grantor has
agreed to perform or pay in this Security Agreement and such Grantor shall
reimburse the Administrative Agent for any reasonable amounts paid by the
Administrative Agent pursuant to this Section 8.3.  Each Grantor’s obligation to reimburse the
Administrative Agent pursuant to the preceding sentence shall be a Secured
Obligation payable on demand.

8.4.          Authorization
for Secured Party to Take Certain Action.  Each Grantor irrevocably authorizes the
Administrative Agent at any time and from time to time in the sole discretion
of the Administrative Agent and appoints the Administrative Agent as its
attorney in fact (i) to execute on behalf of such Grantor as debtor and to file
financing statements necessary or desirable in the Administrative Agent’s sole
discretion to perfect and to maintain the perfection and priority of the
Administrative Agent’s security interest in the Collateral, (ii) during the
continuance of an Event of Default to indorse and collect any cash proceeds of
the Collateral, (iii) to file a carbon, photographic or other reproduction of
this Security Agreement or any financing statement with respect to the
Collateral as a financing statement and to file any other financing statement
or amendment of a financing statement (which does not add new collateral or add
a debtor) in such offices as the Administrative Agent in its sole discretion
deems necessary or desirable to perfect and to maintain the perfection and
priority of the Administrative Agent’s security interest in the Collateral,
(iv) during the continuance of an Event of Default to contact and enter into
one or more agreements with the issuers of uncertificated securities which are
Collateral owned by such Grantor and which are Securities or with financial
intermediaries holding other Investment Property as may be necessary or
advisable to give the Administrative Agent Control over such Securities or
other Investment Property, (v) subject to the terms of Section 4.1.2
hereof, during the continuance of an Event of Default to enforce payment of the
Instruments, Accounts and Receivables in the name of the Administrative Agent
or such Grantor, (vi) during the continuance of an Event of Default to apply
the proceeds of any Collateral received by the Administrative Agent to the
Secured Obligations as provided in Article VII and (vii) during the
continuance of an Event of Default to discharge past due taxes, assessments,
charges, fees or Liens on the Collateral (except for such Liens as are
specifically permitted hereunder or under any other Loan Document), and each
Grantor agrees to reimburse the Administrative Agent on demand for any
reasonable payment made or any reasonable expense incurred by the
Administrative Agent in connection therewith, provided that this authorization
shall not relieve any Grantor of any of its obligations under this Security Agreement
or under the Credit Agreement.

8.5.          Specific
Performance of Certain Covenants.  Each Grantor acknowledges and agrees that a
breach of any of the covenants contained in Sections 4.1.2, 4.1.3,
4.4, 5.3, or 8.7 or in Article VII hereof will
cause irreparable injury to the Administrative Agent and the Holders of Secured
Obligations, that the Administrative Agent and Holders of Secured Obligations
have no adequate remedy at law in respect of such breaches and therefore
agrees, without limiting the right of the Administrative Agent or the Holders
of Secured Obligations to seek and obtain specific performance of other
obligations of the Grantors contained in this Security Agreement, that the
covenants of the Grantors contained in the Sections referred to in this Section
8.5 shall be specifically enforceable against the Grantors.

8.6.          Use
and Possession of Certain Premises.  During the continuance of an Event of
Default, the Administrative Agent shall be entitled to occupy and use any
premises owned or leased by the Grantors where any of the Collateral or any
records relating to the Collateral are located until the Secured Obligations
are paid or the Collateral is removed therefrom, whichever first occurs,
without any obligation to pay any Grantor for such use and occupancy.

8.7.          Dispositions
Not Authorized.  No
Grantor is authorized to sell or otherwise dispose of the Collateral except as
set forth in Section 4.1.2 hereof and notwithstanding any course of
dealing between 

 

15

any Grantor and the
Administrative Agent or other conduct of the Administrative Agent, no
authorization to sell or otherwise dispose of the Collateral (except as set
forth in Section 4.1.2 hereof) shall be binding upon the Administrative
Agent or the Holders of Secured Obligations unless such authorization is in
writing signed by the Administrative Agent with the consent or at the direction
of the Required Lenders.

8.8.          Benefit
of Agreement.  The
terms and provisions of this Security Agreement shall be binding upon and inure
to the benefit of the Grantors, the Administrative Agent and the Holders of
Secured Obligations and their respective successors and assigns (including all
persons who become bound as a debtor to this Security Agreement), except that
the Grantors shall not have the right to assign their rights or delegate their
obligations under this Security Agreement or any interest herein, without the
prior written consent of the Administrative Agent.

8.9.          Survival
of Representations. 
All representations and warranties of the Grantors contained in this
Security Agreement shall survive the execution and delivery of this Security
Agreement.

8.10.        Taxes
and Expenses.  Any
taxes (including income taxes) payable or ruled payable by a Federal or State
authority in respect of this Security Agreement shall be paid by the Grantors,
together with interest and penalties, if any. 
The Grantors shall reimburse the Administrative Agent for any and all
reasonable out-of-pocket expenses (including reasonable fees, charges and
disbursements of counsel) paid or incurred by the Administrative Agent in
connection with the preparation, execution, delivery, administration,
collection and enforcement of this Security Agreement and in the audit,
analysis, administration, collection, preservation or sale of the Collateral
(including the expenses and charges associated with any periodic or special
audit of the Collateral).  Any and all
costs and expenses incurred by the Grantors in the performance of actions
required pursuant to the terms hereof shall be borne solely by the Grantors.

8.11.        Headings.  The title of and section headings in this
Security Agreement are for convenience of reference only, and shall not govern
the interpretation of any of the terms and provisions of this Security
Agreement.

8.12.        Termination.  This Security Agreement shall continue in
effect (notwithstanding the fact that from time to time there may be no Secured
Obligations outstanding) until (i) the Credit Agreement has terminated pursuant
to its express terms and (ii) all of the Secured Obligations (other than Swap
Obligations and Cash Management Obligations not yet then due and payable) have
been indefeasibly paid in cash and performed in full and no commitments of the
Administrative Agent or the Holders of Secured Obligations which would give
rise to any Obligations are outstanding.

8.13.        Entire
Agreement.  This
Security Agreement embodies the entire agreement and understanding between the
Grantors and the Administrative Agent relating to the Collateral and supersedes
all prior agreements and understandings among the Grantors and the
Administrative Agent relating to the Collateral.

8.14.        Governing Law; Jurisdiction; Waiver
of Jury Trial.

8.14.1  THIS SECURITY AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

8.14.2  Each Grantor hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of the Supreme Court of the State of New York sitting in New York
County and of the United States District Court of the Southern District of New 

 

16

York, and any appellate
court from any thereof, in any action or proceeding arising out of or relating
to this Security Agreement or any other Loan Document, or for recognition or
enforcement of any judgment, and each Grantor 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 Grantor 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 Security Agreement or any
other Loan Document shall affect any right that the Administrative Agent, the
Issuing Bank or any Lender may otherwise have to bring any action or proceeding
relating to this Security Agreement or any other Loan Document against any
Grantor or its properties in the courts of any jurisdiction.

8.14.3  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 Security
Agreement or any other Loan Document in any court referred to in Section
8.14.2.  Each Grantor 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.

8.14.4  Each party to this Security Agreement
irrevocably consents to service of process in the manner provided for notices
in Article IX of this Security Agreement, and each of the Grantors hereby
appoints the Company as its agent for service of process.  Nothing in this Security Agreement or any
other Loan Document will affect the right of any party to this Security
Agreement to serve process in any other manner permitted by law.

8.14.5  WAIVER
OF JURY TRIAL.  EACH
GRANTOR 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 SECURITY AGREEMENT OR ANY OTHER
LOAN DOCUMENT (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH GRANTOR (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER GRANTOR HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER GRANTOR WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER GRANTORS HAVE BEEN INDUCED TO ENTER INTO THIS SECURITY AGREEMENT
AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION.

8.15.        Indemnity.  Each Grantor hereby agrees, jointly with the
other Grantors and severally, to indemnify the Administrative Agent and the
Holders of Secured Obligations (collectively, the “Indemnitees”), and
their respective successors, assigns, agents and employees, from and against
any and all liabilities, damages, penalties, suits, costs, and expenses of any
kind and nature  (including, without
limitation, all expenses of litigation or preparation therefor whether or not
any Indemnitee is a party thereto) imposed on, incurred by or asserted against
any Indemnitee, or their respective successors, assigns, agents and employees,
in any way relating to or arising out of this Security Agreement or any other
Loan Document, or the manufacture, purchase, acceptance, rejection, ownership,
delivery, lease, possession, use, operation, condition, sale, return or other
disposition of any Collateral (including, without limitation, latent and other
defects, whether or not discoverable by any Indemnitee or any Grantor, and any
claim for patent, trademark or copyright infringement); provided that
such indemnity shall not, as to any Indemnitee, be available to the extent that
such losses, claims, damages, liabilities or related expenses 

 

17

are determined by a court of
competent jurisdiction to have resulted from (A) the willful misconduct, bad
faith, fraud or gross negligence of such Indemnitee, its controlled affiliates
or any of their respective officers, directors, employees, agents and
controlling persons (each officer, director, employee, agent or controlling
person of any such Indemnitee or any of such entity’s controlled affiliates, a “related
party” of such entity) (B) any material breach of the express obligations
of such Indemnitee or any of its affiliates or related parties under the Credit
Agreement, or (C) any dispute solely among Indemnitees (not arising as a result
of any act or omission by any Grantor or any of its affiliates).

8.16.        Subordination of Intercompany Indebtedness.  Each Grantor agrees that any and all claims
of such Grantor against any other Grantor (each an “Obligor”) with
respect to any “Intercompany Indebtedness” (as hereinafter defined), any
endorser, obligor or any other guarantor of all or any part of the Secured
Obligations, or against any of its properties shall be subordinate and subject
in right of payment to the prior payment, in full and in cash, of all Secured
Obligations, provided that, and not in contravention of the foregoing, so long
as no Event of Default has occurred and is continuing and notice of an Event of
Default has been given by the Administrative Agent, such Grantor may make loans
to and receive payments with respect to such Intercompany Indebtedness from
each such Obligor to the extent not prohibited by the terms of this Security
Agreement and the other Loan Documents. 
Notwithstanding any right of any Grantor to ask, demand, sue for, take
or receive any payment from any Obligor, all rights, liens and security
interests of such Grantor, whether now or hereafter arising and howsoever
existing, in any assets of any other Obligor shall be and are subordinated to
the rights of the Holders of Secured Obligations and the Administrative Agent
in those assets.  No Grantor shall have
any right to possession of any such asset or to foreclose upon any such asset,
whether by judicial action or otherwise, unless and until all of the Secured
Obligations (other than contingent indemnity obligations) shall have been fully
paid and satisfied (in cash) and all Commitments and Letters of Credit issued
under the Credit Agreement have terminated or expired.  If all or any part of the assets of any
Obligor, or the proceeds thereof, are subject to any distribution, division or
application to the creditors of such Obligor, whether partial or complete,
voluntary or involuntary, and whether by reason of liquidation, bankruptcy,
arrangement, receivership, assignment for the benefit of creditors or any other
action or proceeding, or if the business of any such Obligor is dissolved or if
substantially all of the assets of any such Obligor are sold, then, and in any
such event (such events being herein referred to as an “Insolvency Event”),
any payment or distribution of any kind or character, either in cash,
securities or other property, which shall be payable or deliverable upon or
with respect to any indebtedness of any Obligor to any Grantor (“Intercompany
Indebtedness”) shall be paid or delivered directly to the Administrative
Agent for application on any of the Secured Obligations, due or to become due,
until such Secured Obligations (other than contingent indemnity obligations)
shall have first been fully paid and satisfied (in cash).  Should any payment, distribution, security or
instrument or proceeds thereof be received by the applicable Grantor upon or
with respect to the Intercompany Indebtedness after any Insolvency Event and
prior to the satisfaction of all of the Secured Obligations (other than
contingent indemnity obligations) and the termination or expiration of all
Commitments of the Lenders and Letters of Credit issued pursuant to the Credit
Agreement, such Grantor shall receive and hold the same in trust, as trustee,
for the benefit of the Holders of Secured Obligations and shall forthwith
deliver the same to the Administrative Agent, for the benefit of the Holders of
Secured Obligations, in precisely the form received (except for the endorsement
or assignment of the Grantor where necessary), for application to any of the
Secured Obligations, due or not due, and, until so delivered, the same shall be
held in trust by the Grantor as the property of the Holders of Secured
Obligations.  If any such Grantor fails
to make any such endorsement or assignment to the Administrative Agent, the
Administrative Agent or any of its officers or employees is irrevocably
authorized to make the same.  Each
Grantor agrees that until the Secured Obligations (other than the contingent
indemnity obligations) have been paid in full (in cash) and satisfied and all
Commitments and Letters of Credit issued under the Credit Agreement have
terminated or expired, no Grantor will assign or transfer to any Person (other
than the Administrative Agent or the Borrower or another Grantor) any claim any
such Grantor has or may have against any Obligor.

 

18

8.17.        Severability. 
Any provision in this Security Agreement that is held to be inoperative,
unenforceable, or invalid in any jurisdiction shall, as to that jurisdiction,
be inoperative, unenforceable, or invalid without affecting the remaining
provisions in that jurisdiction or the operation, enforceability, or validity
of that provision in any other jurisdiction, and to this end the provisions of
this Security Agreement are declared to be severable.

8.18.        Counterparts. 
This Security Agreement may be executed in counterparts (and by
different parties hereto in different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a
single contract.  Delivery of an executed
counterpart of a signature page of this Security Agreement by telecopy shall be
effective as delivery of a manually executed counterpart of this Security
Agreement.

ARTICLE
IX

NOTICES

9.1.          Sending
Notices.  Any notice
required or permitted to be given under this Security Agreement shall be sent
(and deemed received) in the manner and to the addresses set forth in Section
9.01 of the Credit Agreement.  Any notice
delivered to the Borrower shall be deemed to have been delivered to all of the
Grantors.

9.2.          Change
in Address for Notices. 
Each of the Grantors, the Administrative Agent and the Lenders may
change the address for service of notice upon it by a notice in writing to the
other parties.

ARTICLE
X

THE ADMINISTRATIVE AGENT

JPMorgan Chase Bank,
National Association has been appointed Administrative Agent for the Holders of
Secured Obligations hereunder pursuant to Article VIII of the Credit Agreement.  It is expressly understood and agreed by the
parties to this Security Agreement that any authority conferred upon the
Administrative Agent hereunder is subject to the terms of the delegation of
authority made by the Holders of Secured Obligations to the Administrative
Agent pursuant to the Credit Agreement, and that the Administrative Agent has
agreed to act (and any successor Administrative Agent shall act) as such
hereunder only on the express conditions contained in such Article VIII.  Any successor Administrative Agent appointed
pursuant to Article VIII of the Credit Agreement shall be entitled to all the
rights, interests and benefits of the Administrative Agent hereunder.

[Signature Pages Follow]

19

IN WITNESS WHEREOF, each of
the Grantors and the Administrative Agent have executed this Security Agreement
as of the date first above written.

	
   

  	
  PRICELINE.COM
  INCORPORATED,

  as a Grantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert J. Mylod, Jr.

  	
   

  
	
   

  	
  Name:  Robert
  J. Mylod, r.

  
	
   

  	
  Title:    Chief
  Executive Officer

  

 

	
   

  	
  WALKAWAY, INC., as a
  Grantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Hennessy

  	
   

  
	
   

  	
  Name: 
  Paul Hennessy

  
	
   

  	
  Title:   
  President

  

 

	
   

  	
  PRICELINE.COM AUTO
  SERVICES, LLC, as a 

  Grantor

  
	
   

  	
  by PRICELINE.COM
  INCORPORATED, as 

  Managing Member

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert J. Mylod, Jr.

  	
   

  
	
   

  	
  Name: 
  Robert J. Mylod, Jr.

  
	
   

  	
  Title:   
  Chief Executive Officer

  

 

	
   

  	
  ALLPRICE HOLDINGS, INC.,
  as a Grantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Glenn Fogel

  	
   

  
	
   

  	
  Name: 
  Glenn Fogel

  
	
   

  	
  Title:   
  President

  

 

	
   

  	
  PRICELINE.COM EUROPE
  HOLDCO, INC., as a 

  Grantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Glenn Fogel

  	
   

  
	
   

  	
  Name: 
  Glenn Fogel

  
	
   

  	
  Title:   
  Chief Executive Officer

  

 

	
   

  	
  MTG.COM, INC., as a
  Grantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Hennessy

  	
   

  
	
   

  	
  Name: 
  Paul Hennessy

  
	
   

  	
  Title:   
  President

  

 

	
   

  	
  PCLN ASIA, INC., as a
  Grantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Glenn Fogel

  	
   

  
	
   

  	
  Name: 
  Glenn Fogel

  
	
   

  	
  Title:   
  President

  

 

SIGNATURE
PAGE TO PLEDGE AND SECURITY AGREEMENT

 

 

	
   

  	
  PRICELINE.COM CANADA,
  INC., as a Grantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chris Soder

  	
   

  
	
   

  	
  Name: 
  Chris Soder

  
	
   

  	
  Title:   
  President

  

 

	
   

  	
  LOWESTFARE.COM
  INCORPORATED, as a 

  Grantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chris Soder

  	
   

  
	
   

  	
  Name: 
  Chris Soder

  
	
   

  	
  Title:   
  President

  

 

 

	
   

  	
  TRAVELWEB LLC, as a
  Grantor

  
	
   

  	
  By LOWESTFARE.COM
  INCORPORATED, as 

  Managing Member

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chris Soder

  	
   

  
	
   

  	
  Name: 
  Chris Soder

  
	
   

  	
  Title:   
  President

  

 

SIGNATURE
PAGE TO PLEDGE AND SECURITY AGREEMENT

 

 

	
  JPMORGAN CHASE BANK, NATIONAL

  	
   

  
	
  ASSOCIATION, as Administrative Agent

  	
   

  
	
   

  	
   

  
	
  By: 

  	
  /s/ Edmond F. Thompson

  	
   

  	
   

  
	
  Name: 

  	
  Edmond F. Thompson

  	
   

  
	
  Title:

  	
  SVP

  	
   

  
					

 

SIGNATURE
PAGE TO PLEDGE AND SECURITY AGREEMENTExhibit 10.3

EXECUTION COPY

GUARANTY

THIS GUARANTY (as the same
may be amended, restated, supplemented or otherwise modified from time to time,
this “Guaranty”) is made as of September 26, 2007 by each of the
Subsidiaries of priceline.com Incorporated (the “Borrower”) listed on
the signature pages hereto (each an “Initial Guarantor”) and those
additional Subsidiaries of the Borrower which become parties to this Guaranty
by executing a supplement hereto (a “Guaranty Supplement”) in the form
attached hereto as Annex I (such additional Subsidiaries, together with
the Initial Guarantors, the “Guarantors”), in favor of JPMorgan Chase
Bank, National Association, as Administrative Agent (the “Administrative
Agent”), for the benefit of the Holders of Secured Obligations under the
Credit Agreement described below.  Unless
otherwise defined herein, capitalized terms used herein and not defined herein
shall have the meanings ascribed to such terms in the Credit Agreement.

W  I  T  N  E  S  S  E  T
H :

WHEREAS, the Borrower, the
financial institutions party thereto (collectively, the “Lenders”), and
the Administrative Agent have entered into that certain Credit Agreement of
even date herewith (as the same may be amended, restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”), which
Credit Agreement provides, subject to the terms and conditions thereof, for
extensions of credit and other financial accommodations to be made by the
Lenders to or for the benefit of the Borrower;

WHEREAS, it is a condition
precedent to the extensions of credit by the Lenders under the Credit Agreement
that each of the Guarantors (constituting all of the Subsidiaries of the
Borrower required to execute this Guaranty pursuant to Section 5.09 of
the Credit Agreement) execute and deliver this Guaranty, whereby each of the
Guarantors, without limitation and with full recourse, shall guarantee the
payment when due of all Secured Obligations, including, without limitation, all
principal, interest, letter of credit reimbursement obligations and other
amounts that shall be at any time payable by the Borrower under the Credit
Agreement or the other Loan Documents; and

WHEREAS, in consideration of
the direct and indirect financial and other support and benefits that the
Borrower has provided, and such direct and indirect financial and other support
and benefits as the Borrower may in the future provide, to the Guarantors, and
in consideration of the increased ability of each Guarantor that is a
Subsidiary of the Borrower to receive funds through contributions to capital,
and for each Guarantor to receive funds through intercompany advances or
otherwise, from funds provided to the Borrower pursuant to the Credit Agreement
and the flexibility provided by the Credit Agreement for each Guarantor to do
so which significantly facilitates the business operations of the Borrower and
each Guarantor and in order to induce the Lenders and the Administrative Agent
to enter into the Credit Agreement, and to make the Loans and the other
financial accommodations to the Borrower and to issue the Letters of Credit
described in the Credit Agreement, each of the Guarantors is willing to
guarantee the Secured Obligations under the Credit Agreement and the other Loan
Documents;

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

SECTION 1.           Representations,
Warranties and Covenants.  Each
of the Guarantors represents and warrants to each Lender and the Administrative
Agent as of the date of this Guaranty, giving effect to 

 

 

the
consummation of the transactions contemplated by the Loan Documents on the
Effective Date, and thereafter on each date as required by Section 4.02
of the Credit Agreement that:

(a)           It (i) is a corporation, partnership
or limited liability company duly incorporated or organized, as the case may
be, validly existing and in good standing under the laws of its jurisdiction of
incorporation or organization, (ii) is duly qualified to do business as a
foreign entity and is in good standing (to the extent such concept is
applicable) under the laws of each jurisdiction where the business conducted by
it makes such qualification necessary, and (iii) has all requisite corporate,
partnership or limited liability company power and authority, as the case may
be, to own, operate and encumber its property and to conduct its business in
each jurisdiction in which its business is conducted or proposed to be conducted,
except to the extent failure to do so could not reasonably be expected to
result in a Material Adverse Effect.

(b)           It has the requisite corporate,
limited liability company or partnership, as applicable, power and authority
and legal right to execute and deliver this Guaranty and to perform its
obligations hereunder.  The execution and
delivery by it of this Guaranty and the performance by each of its obligations
hereunder have been duly authorized by proper corporate, limited liability
company or partnership proceedings, including any required shareholder, member
or partner approval, and this Guaranty constitutes a legal, valid and binding
obligation of such Guarantor, enforceable against such Guarantor, in accordance
with its terms, except as enforceability may be limited by (i) bankruptcy,
insolvency, fraudulent conveyances, reorganization or similar laws relating to
or affecting the enforcement of creditors’ rights generally, (ii) general
equitable principles (whether considered in a proceeding in equity or at law),
and (iii) requirements of reasonableness, good faith and fair dealing.

(c)           Neither the execution and delivery by
it of this Guaranty, nor the consummation by it of the transactions herein
contemplated, nor compliance by it with the terms and provisions hereof, will
(i) conflict with the charter or other organizational documents of such
Guarantor, (ii) conflict with, result in a breach of or constitute (with or
without notice or lapse of time or both) a default under any law, rule, regulation,
order, writ, judgment, injunction, decree or award (including, without
limitation, any environmental property transfer laws or regulations) applicable
to such Guarantor or any provisions of any indenture, instrument or agreement
to which such Guarantor or any of such Guarantor’s Subsidiaries is party or is
subject or by which it or its property is bound or affected, or require
termination of any such indenture, instrument or agreement, (iii) result in the
creation or imposition of any Lien whatsoever upon any of the property or
assets of such Guarantor, other than Liens permitted or created by the Loan
Documents, or (iv) require any approval of such Guarantor’s board of directors,
shareholders, members, partners or unitholders except such as have been
obtained.  The execution, delivery and
performance by such Guarantor of each of the Loan Documents to which such
Guarantor is a party do not and will not require any registration with, consent
or approval of, or notice to, or other action to, with or by any Governmental
Authority, including under any environmental property transfer act or
environmental laws or regulations, except filings, consents or notices which
have been made.

                In addition to the foregoing, each of the Guarantors
covenants that, so long as any Lender has any Commitment or Letter of Credit
outstanding under the Credit Agreement or any amount payable under the Credit
Agreement or any other Secured Obligations shall remain unpaid, it will, and,
if necessary, will cause the Borrower to, fully comply with those covenants and
agreements of the Borrower applicable to such Guarantor set forth in the Credit
Agreement.

SECTION 2.           The Guaranty.  Each of the Guarantors hereby unconditionally
guarantees, jointly and severally with the other Guarantors, the full and
punctual payment and performance when due (whether at stated maturity, upon
acceleration or otherwise) of the Secured Obligations, including, without
limitation, (i) the principal of and interest on each Loan made to the Borrower
pursuant to the

 

 

2

 

Credit
Agreement, (ii) obligations owing under or in connection with Letters of
Credit, (iii) all other amounts payable by the Borrower under the Credit
Agreement and the other Loan Documents, and including, without limitation, all
Swap Obligations and Banking Services Obligations, and (iv) the punctual and
faithful performance, keeping, observance, and fulfillment by the Borrower of
all of the agreements, conditions, covenants, and obligations of the Borrower
contained in the Loan Documents (all of the foregoing being referred to
collectively as the “Guaranteed Obligations”).  Upon the failure by the Borrower, or any of
its Affiliates, as applicable, to pay punctually any such amount or perform such
obligation, subject to any applicable grace or notice and cure period, each of
the Guarantors agrees that it shall forthwith on demand pay such amount or
perform such obligation at the place and in the manner specified in the Credit
Agreement or the relevant other Loan Document, as the case may be.  Each of the Guarantors hereby agrees that
this Guaranty is an absolute, irrevocable and unconditional guaranty of payment
and is not a guaranty of collection.

SECTION 3.           Guaranty
Unconditional.  The
obligations of each of the Guarantors hereunder shall be unconditional and
absolute and, without limiting the generality of the foregoing, shall not be
released, discharged or otherwise affected by:

(i)            any
extension, renewal, settlement, indulgence, compromise, waiver or release of or
with respect to the Guaranteed Obligations or any part thereof or any agreement
relating thereto, or with respect to any obligation of any other guarantor of
any of the Guaranteed Obligations, whether (in any such case) by operation of
law or otherwise, or any failure or omission to enforce any right, power or
remedy with respect to the Guaranteed Obligations or any part thereof or any
agreement relating thereto, or with respect to any obligation of any other
guarantor of any of the Guaranteed Obligations;

(ii)           any
modification or amendment of or supplement to the Credit Agreement, any Swap
Agreement, any Banking Services Agreement or any other Loan Document,
including, without limitation, any such amendment which may increase the amount
of, or the interest rates applicable to, any of the Guaranteed Obligations
guaranteed hereby;

(iii)          any
release, surrender, compromise, settlement, waiver, subordination or
modification, with or without consideration, of any collateral securing the
Guaranteed Obligations or any part thereof, any other guaranties with respect
to the Guaranteed Obligations or any part thereof, or any other obligation of
any person or entity with respect to the Guaranteed Obligations or any part
thereof, or any nonperfection or invalidity of any direct or indirect security
for the Guaranteed Obligations;

(iv)          any
change in the corporate, partnership, limited liability company or other
existence, structure or ownership of the Borrower or any other guarantor of any
of the Guaranteed Obligations, or any insolvency, bankruptcy, reorganization or
other similar proceeding affecting the Borrower or any other guarantor of the
Guaranteed Obligations, or any of their respective assets or any resulting
release or discharge of any obligation of the Borrower or any other guarantor
of any of the Guaranteed Obligations;

(v)           the
existence of any claim, setoff or other rights which the Guarantors may have at
any time against the Borrower, any other guarantor of any of the Guaranteed
Obligations, the Administrative Agent, any Holder of Secured Obligations or any
other Person, whether in connection herewith or in connection with any
unrelated transactions, provided that nothing herein shall prevent the
assertion of any such claim by separate suit or compulsory counterclaim;

 

3

(vi)          the
enforceability or validity of the Guaranteed Obligations or any part thereof or
the genuineness, enforceability or validity of any agreement relating thereto
or with respect to any collateral securing the Guaranteed Obligations or any
part thereof, or any other invalidity or unenforceability relating to or
against the Borrower or any other guarantor of any of the Guaranteed
Obligations, for any reason related to the Credit Agreement, any Swap
Agreement, any Banking Services Agreement or any other Loan Document, or any
provision of applicable law, decree, order or regulation purporting to prohibit
the payment by the Borrower or any other guarantor of the Guaranteed Obligations,
of any of the Guaranteed Obligations or otherwise affecting any term of any of
the Guaranteed Obligations;

(vii)         the
failure of the Administrative Agent to take any steps to perfect and maintain
any security interest in, or to preserve any rights to, any security or
collateral for the Guaranteed Obligations, if any;

(viii)        the
election by, or on behalf of, any one or more of the Holders of Secured
Obligations, in any proceeding instituted under Chapter 11 of Title 11 of the
United States Code (11 U.S.C. 101 et seq.) (or any successor statute, the “Bankruptcy
Code”), of the application of Section 1111(b)(2) of the Bankruptcy Code;

(ix)           any
borrowing or grant of a security interest by the Borrower, as
debtor-in-possession, under Section 364 of the Bankruptcy Code;

(x)            the
disallowance, under Section 502 of the Bankruptcy Code, of all or any portion
of the claims of the Holders of Secured Obligations or the Administrative Agent
for repayment of all or any part of the Guaranteed Obligations;

(xi)           the
failure of any other guarantor to sign or become party to this Guaranty or any
amendment, change, or reaffirmation hereof; or

(xii)          any
other act or omission to act or delay of any kind by the Borrower, any other
guarantor of the Guaranteed Obligations, the Administrative Agent, any Holder
of Secured Obligations or any other Person or any other circumstance whatsoever
which might, but for the provisions of this Section 3, constitute a
legal or equitable discharge of any Guarantor’s obligations hereunder.

SECTION 4.           Discharge Only
Upon Payment In Full; Reinstatement In Certain Circumstances.  Each of the Guarantors’ obligations hereunder
shall remain in full force and effect until all Guaranteed Obligations shall
have been paid in full in cash (other than Unliquidated Obligations that have
not yet arisen) and the Commitments and all Letters of Credit issued under the
Credit Agreement shall have terminated or expired or, in the case of all
Letters of Credit, are fully collateralized on terms reasonably acceptable to
the Administrative Agent, at which time, subject to all the foregoing
conditions, the guarantees made hereunder shall be terminated.  If at any time any payment of the principal
of or interest on any Loan, Secured Obligation or any other amount payable by
the Borrower or any other party under the Credit Agreement, any Swap Agreement,
any Banking Services Agreement or any other Loan Document is rescinded or must
be otherwise restored or returned upon the insolvency, bankruptcy or
reorganization of the Borrower or otherwise, each of the Guarantors’
obligations hereunder with respect to such payment shall be reinstated as
though such payment had been due but not made at such time.  The parties hereto acknowledge and agree that
each of the Guaranteed Obligations shall be due and payable in the same
currency as such Guaranteed Obligation is denominated, but if currency control
or exchange regulations are imposed in the country which issues such currency
with the result that such currency (the “Original Currency”) no longer
exists or the relevant Guarantor is not able to make payment in such 

 

 

4

Original
Currency, then all payments to be made by such Guarantor hereunder in such
currency shall instead be made when due in Dollars in an amount equal to the
Dollar Amount (as of the date of payment) of such payment due, it being the
intention of the parties hereto that each Guarantor takes all risks of the
imposition of any such currency control or exchange regulations.

SECTION
5.           General
Waivers; Additional Waivers.

(a)           General Waivers. 
Each of the Guarantors irrevocably waives acceptance hereof,
presentment, demand or action on delinquency, protest, the benefit of any
statutes of limitations and, to the fullest extent permitted by law, any notice
not provided for herein or under the other Loan Documents, as well as any
requirement that at any time any action be taken by any Person against the
Borrower, any other guarantor of the Guaranteed Obligations, or any other Person.

(b)           Additional Waivers. 
Notwithstanding anything herein to the contrary, each of the Guarantors
hereby absolutely, unconditionally, knowingly, and expressly waives, to the
fullest extent permitted by law:

(i)            any
right it may have to revoke this Guaranty as to future indebtedness or notice
of acceptance hereof;

(ii)           (1)
notice of acceptance hereof; (2) notice of any Loans, Letters of Credit or
other financial accommodations made or extended under the Loan Documents or the
creation or existence of any Guaranteed Obligations; (3) notice of the
amount of the Guaranteed Obligations, subject, however, to each Guarantor’s
right to make inquiry of the Administrative Agent and the Holders of Secured
Obligations to ascertain the amount of the Guaranteed Obligations at any
reasonable time; (4) notice of any adverse change in the financial
condition of the Borrower or of any other fact that might increase such
Guarantor’s risk hereunder; (5) notice of presentment for payment, demand,
protest, and notice thereof as to any instruments among the Loan Documents;
(6) notice of any Default or Event of Default; and (7) all other
notices (except if such notice is specifically required to be given to such
Guarantor hereunder or under the Loan Documents) and demands to which each
Guarantor might otherwise be entitled;

(iii)          its
right, if any, to require the Administrative Agent and the other Holders of
Secured Obligations to institute suit against, or to exhaust any rights and
remedies which the Administrative Agent and the other Holders of Secured
Obligations has or may have against, the other Guarantors or any third party,
or against any Collateral provided by the other Guarantors, or any third party;
and each Guarantor further waives any defense arising by reason of any disability
or other defense (other than the defense that the Guaranteed Obligations shall
have been fully and finally performed and indefeasibly paid in full in cash) of
the other Guarantors or by reason of the cessation from any cause whatsoever of
the liability of the other Guarantors in respect thereof;

(iv)          (a)
any rights to assert against the Administrative Agent and the other Holders of
Secured Obligations any defense (legal or equitable), set-off, counterclaim, or
claim which such Guarantor may now or at any time hereafter have against the
other Guarantors or any other party liable to the Administrative Agent and the
other Holders of Secured Obligations; (b) any defense, set-off, counterclaim,
or claim, of any kind or nature, arising directly or indirectly from the
present or future lack of perfection, sufficiency, validity, or enforceability
of the Guaranteed Obligations or any security therefor; (c) any defense such
Guarantor has to performance hereunder, and any right such Guarantor has to be
exonerated, arising by reason of:  (1)
the impairment or suspension of the Administrative Agent’s and the other
Holders of Secured Obligations’ rights or remedies against the other guarantor
of the Guaranteed Obligations; (2) the 

 

 

5

alteration
by the Administrative Agent and the other Holders of Secured Obligations of the
Guaranteed Obligations; (3) any discharge of the other Guarantors’ obligations
to the Administrative Agent and the other Holders of Secured Obligations by
operation of law as a result of the Administrative Agent’s and the other
Holders of Secured Obligations’ intervention or omission; or (4) the acceptance
by the Administrative Agent and the other Holders of Secured Obligations of
anything in partial satisfaction of the Guaranteed Obligations; and (d) the
benefit of any statute of limitations affecting such Guarantor’s liability
hereunder or the enforcement thereof, and any act which shall defer or delay
the operation of any statute of limitations applicable to the Guaranteed
Obligations shall similarly operate to defer or delay the operation of such
statute of limitations applicable to such Guarantor’s liability hereunder; and

(v)           any
defense arising by reason of or deriving from (a) any claim or defense based
upon an election of remedies by the Administrative Agent and the Holders of
Secured Obligations; or (b) any election by the Administrative Agent and the
other Holders of Secured Obligations under the Bankruptcy Code, to limit the
amount of, or any collateral securing, its claim against the Guarantors.

SECTION 6.           Subordination
of Subrogation.  Until the
Guaranteed Obligations have been fully and finally performed and indefeasibly
paid in full in cash (other than Unliquidated Obligations), the Guarantors (i)
shall have no right of subrogation with respect to such Guaranteed Obligations
and (ii) waive any right to enforce any remedy which the Issuing Bank, any of
the Holders of Secured Obligations or the Administrative Agent now have or may
hereafter have against the Borrower, any endorser or any guarantor of all or
any part of the Secured Obligations or any other Person, and until such time
the Guarantors waive any benefit of, and any right to participate in, any
security or collateral given to the Holders of Secured Obligations, the Issuing
Bank and the Administrative Agent to secure the payment or performance of all
or any part of the Guaranteed Obligations or any other liability of the
Borrower to the Holders of Secured Obligations, the Issuing Bank or the
Administrative Agent.  Should any
Guarantor have the right, notwithstanding the foregoing, to exercise its
subrogation rights, each Guarantor hereby expressly and irrevocably (A)
subordinates any and all rights at law or in equity to subrogation, reimbursement,
exoneration, contribution, indemnification or set off that such Guarantor may
have to the payment in full in cash of the Guaranteed Obligations until the
Guaranteed Obligations are indefeasibly paid in full in cash (other than
Unliquidated Obligations) and (B) waives any and all defenses available to a
surety, guarantor or accommodation co-obligor until the Guaranteed Obligations
are indefeasibly paid in full in cash (other than Unliquidated Obligations that
have not yet arisen).  Each Guarantor acknowledges
and agrees that this subordination is intended to benefit the Administrative
Agent and the Holders of Secured Obligations and shall not limit or otherwise
affect such Guarantor’s liability hereunder or the enforceability of this
Guaranty, and that the Administrative Agent, the Holders of Secured Obligations
and their respective successors and assigns are intended third party
beneficiaries of the waivers and agreements set forth in this Section 6.

SECTION 7.           Contribution
with Respect to Guaranteed Obligations.

(a)           To the extent that any Guarantor
shall make a payment under this Guaranty (a “Guarantor Payment”) which,
taking into account all other Guarantor Payments then previously or
concurrently made by any other Guarantor, exceeds the amount which otherwise
would have been paid by or attributable to such Guarantor if each Guarantor had
paid the aggregate Guaranteed Obligations satisfied by such Guarantor Payment
in the same proportion as such Guarantor’s “Allocable Amount” (as defined
below) (as determined immediately prior to such Guarantor Payment) bore to the
aggregate Allocable Amounts of each of the Guarantors as determined immediately
prior to the making of such Guarantor Payment, then, following
indefeasible payment in full in cash of the Guarantor Payment and the
Guaranteed Obligations (other than Unliquidated Obligations that have not yet
arisen), and all Commitments and 

 

 

6

 

Letters
of Credit have terminated or expired or, in the case of all Letters of Credit,
are fully collateralized on terms reasonably acceptable to the Administrative
Agent, and the Credit Agreement, the Swap Agreements and the Banking Services
Agreements have terminated, such Guarantor shall be entitled to receive contribution
and indemnification payments from, and be reimbursed by, each other Guarantor
for the amount of such excess, pro  rata based upon their
respective Allocable Amounts in effect immediately prior to such Guarantor
Payment.

(b)           As of any date of determination, the “Allocable
Amount” of any Guarantor shall be equal to the maximum amount of the claim
which could then be recovered from such Guarantor under this Guaranty without
rendering such claim voidable or avoidable under Section 548 of Chapter 11 of
the Bankruptcy Code or under any applicable state Uniform Fraudulent Transfer
Act, Uniform Fraudulent Conveyance Act or similar statute or common law.

(c)           This Section 7 is intended
only to define the relative rights of the Guarantors, and nothing set forth in
this Section 7 is intended to or shall impair the obligations of the
Guarantors, jointly and severally, to pay any amounts as and when the same
shall become due and payable in accordance with the terms of this Guaranty.

(d)           The parties hereto acknowledge that
the rights of contribution and indemnification hereunder shall constitute
assets of the Guarantor or Guarantors to which such contribution and
indemnification is owing.

(e)           The rights of the indemnifying
Guarantors against other Guarantors under this Section 7 shall be
exercisable upon the full and indefeasible payment of the Guaranteed
Obligations in cash (other than Unliquidated Obligations that have not yet
arisen) and the termination or expiry (or in the case of all Letters of Credit
full collateralization), on terms reasonably acceptable to the Administrative
Agent, of the Commitments and all Letters of Credit issued under the Credit
Agreement and the termination of the Credit Agreement, the Swap Agreements and
the Banking Services Agreements.

SECTION 8.           Stay of
Acceleration.  If
acceleration of the time for payment of any amount payable by the Borrower
under the Credit Agreement, any counterparty to any Swap Agreement, any Banking
Services Agreement or any other Loan Document is stayed upon the insolvency,
bankruptcy or reorganization of the Borrower or any of its Affiliates, all such
amounts otherwise subject to acceleration under the terms of the Credit
Agreement, any Swap Agreement, any Banking Services Agreement or any other Loan
Document shall nonetheless be payable by each of the Guarantors hereunder
forthwith on demand by the Administrative Agent.

SECTION 9.           Notices.  All notices, requests and other
communications to any party hereunder shall be given in the manner prescribed
in Section 9.01 of the Credit Agreement with respect to the
Administrative Agent at its notice address therein and, with respect to any
Guarantor, in the care of the Borrower at the address of the Borrower set forth
in the Credit Agreement, or such other address or telecopy number as such party
may hereafter specify for such purpose in accordance with the provisions of Section
9.01 of the Credit Agreement.

SECTION
10.         No Waivers.  No failure or delay by the Administrative
Agent or any Holder of Secured Obligations in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.  The rights and remedies provided in this
Guaranty, the Credit Agreement, any Swap Agreement, any Banking Services
Agreement and the other Loan Documents shall be cumulative and not exclusive of
any rights or remedies provided by law.

 

7

SECTION
11.         Successors and Assigns.  This Guaranty is for the benefit of the
Administrative Agent and the Holders of Secured Obligations  and
their respective successors and permitted assigns, provided, that no
Guarantor shall have any right to assign its rights or obligations hereunder
without the consent of the Administrative Agent, and any such assignment in
violation of this Section 11 shall be null and void; and in the event of
an assignment of any amounts payable under the Credit Agreement, any Swap
Agreement, any Banking Services Agreement or the other Loan Documents in
accordance with the respective terms thereof, the rights hereunder, to the
extent applicable to the indebtedness so assigned, may be transferred with such
indebtedness. This Guaranty shall be binding upon each of the Guarantors and
their respective successors and assigns.

SECTION
12.         Changes in Writing.  Other than in connection with the addition of
additional Subsidiaries, which become parties hereto by executing a Guaranty
Supplement hereto in the form attached as Annex I, neither this Guaranty
nor any provision hereof may be changed, waived, discharged or terminated
orally, but only in writing signed by each of the Guarantors and the
Administrative Agent with the consent of the Required Lenders under the Credit
Agreement.

SECTION 13.         Governing Law;
Jurisdiction.

(a)           THIS GUARANTY SHALL BE
CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

(b)           Each Guarantor hereby irrevocably and unconditionally
submits, for itself and its property, to the nonexclusive jurisdiction of the
Supreme Court of the State of New York sitting in New York County and of the
United States District Court of the Southern District of New York, and any
appellate court from any thereof, in any action or proceeding arising out of or
relating to this Guaranty or any other Loan Document, or for recognition or
enforcement of any judgment, and each Guarantor 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 Guarantor 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 Guaranty or any other Loan
Document shall affect any right that the Administrative Agent, the Issuing Bank
or any Lender may otherwise have to bring any action or proceeding relating to
this Guaranty or any other Loan Document against any Guarantor or its
properties in the courts of any jurisdiction.

(c)           Each Guarantor 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 Guaranty or any
other Loan Document in any court referred to in paragraph (b) of this Section.  Each Guarantor 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 Guaranty irrevocably consents to
service of process in the manner provided for notices in Section 9 of
this Guaranty, and each of the Guarantors hereby appoints the Borrower as its
agent for service of process.  Nothing in
this Guaranty or any other Loan Document will affect the right of any party to
this Guaranty to serve process in any other manner permitted by law.

SECTION 14.         WAIVER
OF JURY TRIAL.  EACH
GUARANTOR 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 GUARANTY OR ANY OTHER LOAN 

 

 

8

DOCUMENT
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH GUARANTOR (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER GUARANTOR HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER GUARANTOR WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT
AND THE OTHER GUARANTORS HAVE BEEN INDUCED TO ENTER INTO THIS GUARANTY BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

SECTION 15.         No Strict
Construction.  The parties
hereto have participated jointly in the negotiation and drafting of this
Guaranty.  In the event an ambiguity or question
of intent or interpretation arises, this Guaranty shall be construed as if
drafted jointly by the parties hereto and no presumption or burden of proof
shall arise favoring or disfavoring any party by virtue of the authorship of
any provisions of this Guaranty.

SECTION 16.         Taxes, Expenses
of Enforcement, Etc.

(a)           Taxes.

(i)            All
payments by any Guarantor to or for the account of any Lender, the Issuing
Bank, the Administrative Agent or any other Holder of Secured Obligations
hereunder or under any promissory note or application for a Letter of Credit
shall be made free and clear of and without deduction for any and all
Taxes.  If any Guarantor shall be
required by law to deduct any Taxes from or in respect of any sum payable
hereunder to any Lender, the Issuing Bank, the Administrative Agent or any
other Holder of Secured Obligations, (a) the sum payable shall be increased as
necessary so that after making all required deductions (including deductions
applicable to additional sums payable under this Section 16(a)) such
Lender, the Issuing Bank, the Administrative Agent or any other Holder of
Secured Obligations (as the case may be) receives an amount equal to the sum it
would have received had no such deductions been made, (b) such Guarantor shall
make such deductions, (c) such Guarantor shall pay the full amount deducted to
the relevant authority in accordance with applicable law and (d) such Guarantor
shall furnish to the Administrative Agent the original copy of a receipt
evidencing payment thereof within thirty (30) days after such payment is made.

(ii)           In
addition, the Guarantors hereby agree to pay any present or future stamp or
documentary taxes and any other excise or property taxes, charges or similar
levies which arise from any payment made hereunder or under any promissory note
or application for a Letter of Credit or from the execution or delivery of, or
otherwise with respect to, this Guaranty or any promissory note or application
for a Letter of Credit (“Other Taxes”).

(iii)          The
Guarantors hereby agree to indemnify the Administrative Agent, the Issuing
Bank, each Lender and any other Holder of Secured Obligations for the full
amount of Taxes or Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed on amounts payable under this Section 16(a)) paid by
the Administrative Agent, the Issuing Bank, such Lender or such other Holder of
Secured Obligations and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto.  Payments due under this indemnification shall
be made within thirty (30) days of the date the Administrative Agent, the
Issuing Bank, such Lender or such other Holder of Secured Obligations makes
demand therefor.

(iv)          By
accepting the benefits hereof, each Foreign Lender agrees that it will comply
with Section 2.17(e) of the Credit Agreement.

 

9

(b)           Expenses of Enforcement, Etc.  Subject to the terms of the Credit Agreement,
after the occurrence of an Event of Default the Lenders shall have the right at
any time to direct the Administrative Agent to commence enforcement proceedings
with respect to the Guaranteed Obligations. 
The Guarantors agree to reimburse the Administrative Agent and the
Holders of Secured Obligations for any costs and out-of-pocket
expenses (including reasonable attorneys’ fees and time charges of attorneys
for the Administrative Agent and the Holders of Secured Obligations, which
attorneys may be employees of the Administrative Agent or the Holders of Secured
Obligations) paid or incurred by the Administrative Agent or any Holders of
Secured Obligations in connection with the collection and enforcement of
amounts due under the Loan Documents, including, without limitation, this
Guaranty.  The Administrative Agent
agrees to distribute payments received from any of the Guarantors hereunder to
the Holders of Secured Obligations on a pro rata basis for application in
accordance with the terms of the Credit Agreement.

SECTION 17.         Setoff.  At any time after all or any part of the
Guaranteed Obligations have become due and payable (by acceleration or
otherwise), each Holder of Secured Obligations and the Administrative Agent
may, without notice to any Guarantor and regardless of the acceptance of any
security or collateral for the payment hereof, set off and apply toward the
payment of all or any part of the Guaranteed Obligations any and all deposits
(general or special, time or demand, provisional or final and in whatever
currency denominated at any time held) and other obligations at any time owing
by such Holder of Secured Obligations or the Administrative Agent or any of
their Affiliates to or for the credit or the account of any Guarantor against
any of and all the Guaranteed Obligations, irrespective of whether or not such
Holder of Secured Obligations or the Administrative Agent shall have made any
demand under this Guaranty and although such obligations may be unmatured.  The rights of each Holder of Secured
Obligations or the Administrative Agent under this Section are in addition to
other rights and remedies (including other rights of setoff) which such Holder
of Secured Obligations or the Administrative Agent may have.

SECTION 18.         Financial
Information.  Each
Guarantor hereby assumes responsibility for keeping itself informed of the
financial condition of the Borrower, the other Guarantors and any and all
endorsers and/or other guarantors of all or any part of the Guaranteed
Obligations, and of all other circumstances bearing upon the risk of nonpayment
of the Guaranteed Obligations, or any part thereof, that diligent inquiry would
reveal, and each Guarantor hereby agrees that none of the Holders of Secured
Obligations or the Administrative Agent shall have any duty to advise such
Guarantor of information known to any of them regarding such condition or any
such circumstances.  In the event any
Holder of Secured Obligations or the Administrative Agent, in its sole
discretion, undertakes at any time or from time to time to provide any such
information to a Guarantor, such Holder of Secured Obligations or the
Administrative Agent shall be under no obligation (i) to undertake any
investigation not a part of its regular business routine, (ii) to disclose any
information which such Holder of Secured Obligations or the Administrative
Agent, pursuant to accepted or reasonable commercial finance or banking
practices, wishes to maintain confidential or (iii) to make any other or future
disclosures of such information or any other information to such Guarantor.

SECTION 19.         Severability.  Wherever possible, each provision of this
Guaranty shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Guaranty shall be prohibited by or
invalid under such law, such provision shall be ineffective to the extent of
such prohibition or invalidity without invalidating the remainder of such
provision or the remaining provisions of this Guaranty.

SECTION 20.         Merger.  This Guaranty represents the final agreement
of each of the Guarantors with respect to the matters contained herein and may
not be contradicted by evidence of prior or 

 

 

10

contemporaneous
agreements, or subsequent oral agreements, between each such Guarantor and any
Holder of Secured Obligations or the Administrative Agent.

SECTION 21.         Headings.  Section headings in this Guaranty are for
convenience of reference only and shall not govern the interpretation of any
provision of this Guaranty.

SECTION
22.         Judgment Currency.  for the purposes of obtaining judgment in any
court it is necessary to convert a sum due from any Guarantor hereunder in the
currency expressed to be payable herein (the “Specified Currency”) into
another currency, the parties hereto agree, to the fullest extent that they may
effectively do so, that the rate of exchange used shall be that at which in
accordance with normal banking procedures the Administrative Agent could
purchase the Specified Currency with such other currency at the Administrative
Agent’s main New York office on the Business Day preceding that on which final,
non-appealable judgment is given.  The
obligations of each Guarantor in respect of any sum due hereunder shall,
notwithstanding any judgment in a currency other than the Specified Currency,
be discharged only to the extent that on the Business Day following receipt by
any Holder of Secured Obligations (including the Administrative Agent), as the
case may be, of any sum adjudged to be so due in such other currency such
Holder of Secured Obligations (including the Administrative Agent), as the case
may be, may in accordance with normal, reasonable banking procedures purchase
the Specified Currency with such other currency.  If the amount of the Specified Currency so
purchased is less than the sum originally due to such Holder of Secured
Obligations (including the Administrative Agent), as the case may be, in the
Specified Currency, each Guarantor agrees, to the fullest extent that it may
effectively do so, as a separate obligation and notwithstanding any such
judgment, to indemnify such Holder of Secured Obligations (including the
Administrative Agent), as the case may be, against such loss, and if the amount
of the Specified Currency so purchased exceeds (a) the sum originally due to
any Holder of Secured Obligations (including the Administrative Agent), as the
case may be, in the Specified Currency and (b) amounts shared with other
Holders of Secured Obligations as a result of allocations of such excess as a
disproportionate payment to such other Holder of Secured Obligations under Section
2.18 of the Credit Agreement, such Holder of Secured Obligations (including
the Administrative Agent), as the case may be, agrees, by accepting the
benefits hereof, to remit such excess to such Guarantor.

 

[SIGNATURE
PAGES TO FOLLOW]

 

11

 

	
   

  	
  WALKAWAY, INC., as an
  Initial Guarantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Hennessy

  	
   

  
	
   

  	
  Name:

  	
  Paul Hennessy

  
	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  
	
   

  	
  PRICELINE.COM AUTO
  SERVICES, LLC, as an

  Initial Guarantor

  
	
   

  	
  by PRICELINE.COM
  INCORPORATED, as

  Managing Member

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert J. Mylod, Jr.

  	
   

  
	
   

  	
  Name:

  	
  Robert J. Mylod, Jr.

  
	
   

  	
  Title:

  	
  Chief Financial Officer

  
	
   

  	
   

  
	
   

  	
  ALLPRICE HOLDINGS, INC.,
  as an Initial

  Guarantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Glenn Fogel

  	
   

  
	
   

  	
  Name:

  	
  Glenn Fogel

  
	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  
	
   

  	
  PRICELINE.COM EUROPE
  HOLDCO, INC., as an

  Initial Guarantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Glenn Fogel

  	
   

  
	
   

  	
  Name:

  	
  Glenn Fogel

  
	
   

  	
  Title:

  	
  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
  MTG.COM, INC., as an
  Initial Guarantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul Hennessy

  	
   

  
	
   

  	
  Name:

  	
  Paul Hennessy

  
	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  
	
   

  	
  PCLN ASIA, INC., as an
  Initial Guarantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Glenn Fogel

  	
   

  
	
   

  	
  Name:

  	
  Glenn Fogel

  
	
   

  	
  Title:

  	
  President

  
							

 

SIGNATURE PAGE TO GUARANTY

 

 

	
   

  	
  PRICELINE.COM CANADA,
  INC., as an Initial

  Guarantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chris Soder

  	
   

  
	
   

  	
  Name:

  	
  Chris Soder

  
	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  
	
   

  	
  LOWESTFARE.COM
  INCORPORATED, as an

  Initial Guarantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chris Soder

  	
   

  
	
   

  	
  Name:

  	
   Chris Soder

  
	
   

  	
  Title:

  	
   President

  
	
   

  	
   

  
	
   

  	
  TRAVELWEB LLC, as an
  Initial Guarantor

  
	
   

  	
  By LOWESTFARE.COM
  INCORPORATED, as

  Managing Member

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Chris Soder

  	
   

  
	
   

  	
  Name:

  	
   Chris Soder

  
	
   

  	
  Title:

  	
   President

  
							

 

SIGNATURE PAGE TO GUARANTY

 

 

	
  JPMORGAN CHASE BANK, NATIONAL

  
	
  ASSOCIATION, as Administrative Agent

  
	
   

  
	
  By: 

  	
  /s/ Edmond F. Thompson

  	
   

  
	
  Name:

  	
  Edmond F. Thompson

  
	
  Title:

  	
  SVP

  
				

 

SIGNATURE PAGE TO GUARANTY

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