Document:

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                          PLEDGE AND SECURITY AGREEMENT

                            DATED AS OF MAY 13, 2002

                                     BETWEEN

                                     EACH OF

                            MARINER HEALTH CARE, INC.

                       AND THE OTHER GRANTORS PARTY HERETO

                                       AND

                         RESIDENTIAL FUNDING CORPORATION

                           DBA GMAC-RFC HEALTH CAPITAL

                          AS THE JOINT COLLATERAL AGENT
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                                TABLE OF CONTENTS

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                                                                                                           PAGE
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SECTION 1.  DEFINITIONS; GRANT OF SECURITY..............................................................      2
   1.1      GENERAL DEFINITIONS.........................................................................      2
   1.2      DEFINITIONS; INTERPRETATION.................................................................     10
SECTION 2.  GRANT OF SECURITY...........................................................................     10
   2.1      GRANT OF SECURITY...........................................................................     10
   2.2      CERTAIN LIMITED EXCLUSIONS..................................................................     11
SECTION 3.  SECURITY FOR OBLIGATIONS; GRANTORS REMAIN LIABLE............................................     12
   3.1      SECURITY FOR OBLIGATIONS....................................................................     12
   3.2      CONTINUING LIABILITY UNDER COLLATERAL.......................................................     12
SECTION 4.  REPRESENTATIONS AND WARRANTIES AND COVENANTS................................................     12
   4.1      GENERALLY...................................................................................     12
   4.2      EQUIPMENT AND INVENTORY.....................................................................     15
   4.3      RECEIVABLES.................................................................................     16
   4.4      INVESTMENT RELATED PROPERTY.................................................................     18
   4.5      MATERIAL CONTRACTS..........................................................................     24
   4.6      LETTER OF CREDIT RIGHTS.....................................................................     25
   4.7      INTELLECTUAL PROPERTY.......................................................................     26
   4.8      COMMERCIAL TORT CLAIMS......................................................................     29
SECTION 5.  ACCESS; RIGHT OF INSPECTION AND FURTHER ASSURANCES; ADDITIONAL GRANTORS.....................     30
   5.1      ACCESS; RIGHT OF INSPECTION.................................................................     30
   5.2      FURTHER ASSURANCES..........................................................................     30
   5.3      ADDITIONAL GRANTORS.........................................................................     31
SECTION 6.  JOINT COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT...........................................     31
   6.1      POWER OF ATTORNEY...........................................................................     31
   6.2      NO DUTY ON THE PART OF JOINT COLLATERAL AGENT OR SECURED PARTIES............................     32
   6.3      RATIFICATION................................................................................     32
SECTION 7.  REMEDIES....................................................................................     32
   7.1      GENERALLY...................................................................................     33
   7.2      APPLICATION OF PROCEEDS.....................................................................     34
   7.3      INVESTMENT RELATED PROPERTY.................................................................     34
   7.4      INTELLECTUAL PROPERTY.......................................................................     35
   7.5      CASH PROCEEDS...............................................................................     37
SECTION 8.  JOINT COLLATERAL AGENT......................................................................     37
SECTION 9.  CONTINUING SECURITY INTEREST; TRANSFER OF LOANS.............................................     37
SECTION 10. STANDARD OF CARE; JOINT COLLATERAL AGENT MAY PERFORM........................................     38
SECTION 11. MISCELLANEOUS...............................................................................     38
   11.1     NOTICE, ASSIGNMENT, ETC.....................................................................     38
   11.2     EFFECT OF  DISCHARGE OF ROLLOVER NOTE INDENTURE.............................................     39
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SCHEDULE  A  -- LIST OF GRANTORS

SCHEDULE 1.1 -- EXCLUDED SUBSIDIARY INTERESTS

SCHEDULE 4.1 -- GENERAL INFORMATION

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SCHEDULE 4.2 -- LOCATION OF EQUIPMENT AND INVENTORY

SCHEDULE 4.4 -- INVESTMENT RELATED PROPERTY

SCHEDULE 4.6 -- DESCRIPTION OF LETTERS OF CREDIT

SCHEDULE 4.7 -- INTELLECTUAL PROPERTY

SCHEDULE 4.8 -- COMMERCIAL TORT CLAIMS

EXHIBIT A -- PLEDGE SUPPLEMENT

EXHIBIT B -- FORM OF UNCERTIFICATED SECURITIES CONTROL AGREEMENT

EXHIBIT C -- FORM OF COLLATERAL ACCOUNT CONTROL AGREEMENT

EXHIBIT D -- FORM OF PERSONAL PROPERTY SECURITY INTEREST OPINION

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                  This PLEDGE AND SECURITY AGREEMENT, dated as of May 13, 2002
(this "AGREEMENT"), between EACH OF THE UNDERSIGNED, whether as an original
signatory hereto or as an Additional Grantor (as herein defined) (each, a
"GRANTOR"), and RESIDENTIAL FUNDING CORPORATION DBA GMAC-RFC HEALTH CAPITAL, as
joint collateral agent for the Secured Parties (as herein defined) (in such
capacity as joint collateral agent, the "JOINT COLLATERAL AGENT").

                                    RECITALS:

         WHEREAS, reference is made to that certain Credit and Guaranty
Agreement, dated as of the date hereof (as it may be amended, restated,
supplemented or otherwise modified from time to time, the "CREDIT AGREEMENT"),
by and among MARINER HEALTH CARE, INC., a Delaware corporation (f/k/a Mariner
Post-Acute Network, Inc., and herein referred to as the "COMPANY"), certain
Subsidiaries of the Company, as Guarantors, the lenders party thereto from time
to time (the "LENDERS"), GOLDMAN SACHS CREDIT PARTNERS L.P., as a Joint Lead
Arranger and as Syndication Agent, UBS AG, STAMFORD BRANCH, as Administrative
Agent (the "ADMINISTRATIVE AGENT") and as Swing Line Lender, UBS WARBURG LLC, as
a Joint Lead Arranger, GENERAL ELECTRIC CAPITAL CORPORATION, as Documentation
Agent and as Collateral Monitoring Agent, and the Joint Collateral Agent;

         WHEREAS, subject to the terms and conditions of the Credit Agreement,
certain Grantors may enter into one or more Hedge Agreements (as herein defined)
with one or more Lender Counterparties;

         WHEREAS, in consideration of the extensions of credit and other
accommodations of Lenders and Lender Counterparties as set forth in the Credit
Agreement and the Hedge Agreements, respectively, each Grantor has agreed to
secure such Grantor's obligations under the Credit Documents and the Hedge
Agreements as set forth herein;

         WHEREAS, reference is made to that certain Indenture, dated as of the
date hereof (as it may be amended, restated, supplemented or otherwise modified
from time to time, the "ROLLOVER NOTE INDENTURE"), by and among the Company,
certain Subsidiaries of the Company, as Guarantors, and THE BANK OF NEW YORK, a
New York banking corporation, as Trustee (together with any successor trustee
appointed in accordance with the Rollover Note Indenture, the "ROLLOVER NOTE
TRUSTEE");

         WHEREAS, in consideration of the purchase of the Rollover Notes by the
Rollover Noteholders as set forth in the Rollover Note Indenture, each Grantor
has agreed to secure such Grantor's obligations under the Rollover Note
Indenture and the Rollover Notes as set forth herein;

         WHEREAS, under that certain Intercreditor and Collateral Agency
Agreement dated as of the date hereof (as it may be amended, restated,
supplemented or otherwise modified from time to time, the "INTERCREDITOR
AGREEMENT") by and among the Company, the Administrative Agent, the Rollover
Note Trustee and the Joint Collateral Agent, the Joint Collateral Agent was
appointed as joint collateral agent for the Secured Parties; and

         NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, each Grantor and the Joint Collateral
Agent agree as follows:
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SECTION 1. DEFINITIONS; GRANT OF SECURITY.

         1.1      GENERAL DEFINITIONS. In this Agreement, the following terms
shall have the following meanings:

                  "ACCOUNT DEBTOR" shall mean each Person who is obligated on a
Receivable or any Supporting Obligation related thereto.

                  "ACCOUNTS" shall mean all "accounts" as defined in Article 9
of the UCC.

                  "AGREEMENT" shall have the meaning set forth in the preamble.

                  "ADDITIONAL GRANTORS" shall have the meaning assigned in
Section 5.3.

                  "AFFILIATE" shall mean, as applied to any Person, any other
Person directly or indirectly controlling, controlled by, or under common
control with, that Person. For the purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power (i) to vote 15% or more of the
Securities having ordinary voting power for the election of directors of such
Person or (ii) to direct or cause the direction of the management and policies
of that Person, whether through the ownership of voting securities or by
contract or otherwise.

                  "ASSIGNED AGREEMENTS" shall mean all agreements and contracts
to which such Grantor is a party as of the date hereof, or to which such Grantor
becomes a party after the date hereof, including, without limitation, each
Material Contract, as each such agreement may be amended, supplemented or
otherwise modified from time to time.

                  "BANKRUPTCY CODE" shall mean Title 11 of the United States
Code entitled "Bankruptcy", as now and hereafter in effect, or any successor
statute.

                  "CASH PROCEEDS" shall have the meaning assigned in Section
7.5.

                  "CHATTEL PAPER" shall mean all "chattel paper" as defined in
Article 9 of the UCC, including, without limitation, "electronic chattel paper"
or "tangible chattel paper", as each term is defined in Article 9 of the UCC.

                  "COLLATERAL" shall have the meaning assigned in Section 2.1.

                  "COLLATERAL RECORDS" shall mean books, records, ledger cards,
files, correspondence, customer lists, blueprints, technical specifications,
manuals, computer software, computer printouts, tapes, disks and related data
processing software and similar items that at any time evidence or contain
information relating to any of the Collateral or are otherwise necessary or
helpful in the collection thereof or realization thereupon.

                  "COLLATERAL SUPPORT" shall mean all property (real or
personal) assigned, hypothecated or otherwise securing any Collateral and shall
include any security agreement or other agreement granting a lien or security
interest in such real or personal property.

                  "COLLECTION ACCOUNT" shall mean any account established at a
financial institution designated by the Joint Collateral Agent in the name of
"Mariner Health Care, Inc. -

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Residential Funding Corporation dba GMAC-RFC HEALTH CAPITAL, as Joint Collateral
Agent", together with any and all successor, replacement or substituted accounts
thereto.

                  "COMMERCIAL TORT CLAIMS" shall mean all "commercial tort
claims" as defined in Article 9 of the UCC, including, without limitation, all
commercial tort claims listed on Schedule 4.8 (as such schedule may be amended
or supplemented from time to time).

                  "COMMODITIES ACCOUNTS" (i) shall mean all "commodity accounts"
as defined in Article 9 of the UCC and (ii) shall include, without limitation,
all of the accounts listed on Schedule 4.4 under the heading "Commodities
Accounts" (as such schedule may be amended or supplemented from time to time).

                  "COMPANY" shall have the meaning set forth in the recitals.

                  "CONCENTRATION ACCOUNT" shall mean any account listed on
Schedule 4.4(A)(8)(a) under the heading "Deposit Accounts: Concentration
Account" (as such schedule may be amended or supplemented from time to time),
together with any and all successor, replacement or substituted accounts
thereto.

                  "CONTROLLED FOREIGN CORPORATION" shall mean "controlled
foreign corporation" as defined in the Tax Code.

                  "COPYRIGHT LICENSES" shall mean any and all agreements
providing for the granting of any right in or to Copyrights (whether such
Grantor is licensee or licensor thereunder) including, without limitation, each
agreement referred to in Schedule 4.7(B) (as such schedule may be amended or
supplemented from time to time).

                  "COPYRIGHTS" shall mean all United States and foreign
copyrights, all mask works fixed in semi-conductor chip products (as defined
under 17 U.S.C. 901 of the U.S. Copyright Act), whether registered or
unregistered, now or hereafter in force throughout the world, all registrations
and applications therefor including, without limitation, the applications
referred to in Schedule 4.7(A) (as such schedule may be amended or supplemented
from time to time), all rights corresponding thereto throughout the world, all
extensions and renewals of any thereof, the right to sue for past, present and
future infringements of any of the foregoing, and all proceeds of the foregoing,
including, without limitation, licenses, royalties, income, payments, claims,
damages, and proceeds of suit.

                  "CREDIT AGREEMENT" shall have the meaning set forth in the
recitals.

                  "DOCUMENTS" shall mean all "documents" as defined in Article 9
of the UCC.

                  "DE MINIMIS SECURITIES ACCOUNTS" shall have the meaning
assigned to such term in Section 4.4.4(a)(iii) hereto.

                  "DE MINIMIS SECURITIES ENTITLEMENTS" shall have the meaning
assigned to such term in Section 4.4.4(a)(iii) hereto.

                  "DEPOSIT ACCOUNTS" (i) shall mean all "deposit accounts" as
defined in Article 9 of the UCC and in any event shall include any demand, time,
savings, passbook or title account maintained with a depository institution and
(ii) shall include, without limitation, all of the

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accounts listed on Schedule 4.4 under the heading "Deposit Accounts" (as such
schedule may be amended or supplemented from time to time).

                  "DIRECTING PARTY" shall have the meaning assigned to it in the
Intercreditor Agreement.

                  "EQUIPMENT" shall mean: (i) all "equipment" as defined in
Article 9 of the UCC, (ii) all machinery, manufacturing equipment, data
processing equipment, computers, office equipment, furnishings, furniture,
appliances, fixtures, tools (in each case, regardless of whether characterized
as equipment under the UCC) and (iii) all accessions or additions thereto, all
parts thereof, whether or not at any time of determination incorporated or
installed therein or attached thereto, and all replacements therefor, wherever
located, now or hereafter existing, including any fixtures.

                  "ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, and any successor thereto.

                  "EVENT OF DEFAULT" shall mean (i) at any time on or prior to
the First Priority Termination Date, an Event of Default as defined in the
Credit Agreement and (ii) at any time after the First Priority Termination Date,
an Event of Default as defined in the Rollover Note Indenture.

                  "EXCLUDED SUBSIDIARY INTERESTS" shall mean any shares of
capital stock, limited liability company interests, partnership interests or
trust interests in any entity listed on Schedule 1.1 hereto (as such schedule
may be amended or supplemented from time to time); provided, that any shares of
capital stock, limited liability company interests, partnership interests or
trust interests in any entity listed on Schedule 1.1 hereto shall automatically
be deemed not to be an Excluded Subsidiary Interest upon a grant of security
interest by the applicable Grantor in such capital stock, limited liability
company interests, partnership interests or trust interests by the delivery to
the Joint Collateral Agent of a Pledge Supplement, substantially in the form of
Exhibit A attached hereto, together with all Supplements to Schedules thereto,
reflecting such Pledged Equity Interests.

                  "EXCLUDED PROPERTY" shall mean (i) all Fixtures located on, in
connection with, relating to the Mariner Health of Jacksonville facility located
in Duval County, Florida, (ii) all Fixtures and Equipment located on, in
connection with, relating to the Jacinto City Healthcare Center facility located
in Harris County, Texas, Southfield HealthCare Center facility located in Harris
County, Texas, The Village Healthcare Center facility located in Harris County,
Texas, Retama Manor Nursing Center/ Corpus Christi North located in Nueces
County, Texas, Spring Branch HealthCare Center located in Harris County, Texas
and Lynn Lodge Nursing Center facility located in Gregg County, Texas and (iii)
all personal property located on, in connection with, relating to or arising out
of the Mariner Health of Westchester facility located in Cook County, Illinois
and the Mainer Health of Palmetto facility located in Manatee County, Florida

                  "EXCLUDED PROPERTY DOCUMENT" shall mean any agreement that
evidences the transfer of the security interest in the Excluded Property by the
applicable Grantor in favor of a Person other than the Joint Collateral Agent.

                  "FIRST PRIORITY OBLIGATIONS" shall mean the Obligations as
defined in the Credit Agreement and all other sums payable by the Grantors to
the Joint Collateral Agent under the Credit Documents; provided that at no time
may the aggregate principal amount of the First

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Priority Obligations exceed the amount of "Senior Indebtedness" as permitted by
and defined in the Rollover Note Indenture as of the date hereof or as amended
from time to time with the consent of Requisite Lenders (as defined in the
Credit Agreement).

                  "FIRST PRIORITY SECURED PARTIES" shall mean the Joint
Collateral Agent, the Agents (as such term is defined in the Credit Agreement),
the Lenders and the Lender Counterparties and shall include, without limitation,
all former Lenders, Lender Counterparties, Agents and Joint Collateral Agent to
the extent that any First Priority Obligations owing to such Persons were
incurred while such Persons were Lenders, Lender Counterparties, Agents or Joint
Collateral Agent and such First Priority Obligations have not been paid or
satisfied in full.

                  "FIRST PRIORITY TERMINATION DATE" shall mean the last day to
occur of (i) the payment in full of all First Priority Obligations, (ii) the
cancellation or termination of the Commitments and (iii) the cancellation or
expiration of all outstanding Letters of Credit.

                  "FIXTURES" shall mean all "fixtures" as defined in Article 9
of the UCC.

                  "GENERAL INTANGIBLES" (i) shall mean all "general intangibles"
as defined in Article 9 of the UCC and (ii) shall include, without limitation,
all interest rate or currency protection or hedging arrangements, all tax
refunds, all licenses, permits, concessions and authorizations, all Assigned
Agreements and all Intellectual Property (in each case, regardless of whether
characterized as general intangibles under the UCC).

                  "GOODS" (i) shall mean all "goods" as defined in Article 9 of
the UCC and (ii) shall include, without limitation, all Inventory and Equipment
(in each case, regardless of whether characterized as goods under the UCC).

                  "GRANTORS" shall have the meaning set forth in the preamble.

                  "INSTRUMENTS" shall mean all "instruments" as defined in
Article 9 of the UCC.

                  "INSURANCE" shall mean: (i) all insurance policies covering
any or all of the Collateral (regardless of whether the Joint Collateral Agent
is the loss payee thereof) and (ii) any key man life insurance policies.

                  "INSURANCE CONCENTRATION ACCOUNT" shall mean any account
listed on Schedule 4.4(A)(8)(b) under the heading "Deposit Account: Insurance
Concentration Account" (as such schedule may be amended or supplemented from
time to time), together with any and all successor, replacement or substituted
accounts.

                  "INTELLECTUAL PROPERTY" shall mean, collectively, the
Copyrights, the Copyright Licenses, the Patents, the Patent Licenses, the
Trademarks, the Trademark Licenses, the Trade Secrets, and the Trade Secret
Licenses and in any event shall include all present and future rights,
priorities and privileges relating to intellectual property arising under United
States, applicable state, multinational or foreign laws or otherwise.

                  "INVENTORY" shall mean: (i) all "inventory" as defined in
Article 9 of the UCC and (ii) all goods held for sale or lease or to be
furnished under contracts of service or so leased or furnished, all raw
materials, work in process, finished goods, and materials used or consumed in
the manufacture, packing, shipping, advertising, selling, leasing, furnishing or
production of such inventory or otherwise used or consumed in any Grantor's
business; all goods in which any

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Grantor has an interest in mass or a joint or other interest or right of any
kind; and all goods which are returned to or repossessed by any Grantor, all
computer programs embedded in any goods and all accessions thereto and products
thereof (in each case, regardless of whether characterized as inventory under
the UCC).

                  "INVESTMENT ACCOUNTS" shall mean the Securities Accounts,
Commodities Accounts and Deposit Accounts.

                  "INVESTMENT RELATED PROPERTY" shall mean: (i) all "investment
property" (as such term is defined in Article 9 of the UCC) other than Excluded
Subsidiary Interests and (ii) all of the following (regardless of whether
classified as investment property under the UCC): all Pledged Equity Interests,
Pledged Debt, the Investment Accounts and certificates of deposit.

                  "JOINT COLLATERAL AGENT" shall have the meaning set forth in
the preamble.

                  "LENDER" shall have the meaning set forth in the recitals.

                  "LETTER OF CREDIT RIGHT" shall mean "letter-of-credit right"
as defined in Article 9 of the UCC.

                  "MONEY" shall mean "money" as defined in the UCC.

                  "NON-ASSIGNABLE CONTRACT" shall mean any agreement, contract
or license to which any Grantor is a party that by its terms purport to restrict
or prevent the assignment or granting of a security interest therein (either by
its terms or by any federal or state statutory prohibition or otherwise,
irrespective of whether such prohibition or restriction is enforceable under
Sections 9-406 through 409 of the UCC).

                  "OUTSTANDING LETTER OF CREDIT" shall mean any Letter of Credit
issued pursuant to the Credit Agreement other than any Letter of Credit
outstanding beyond the Revolving Commitment Termination Date and backed by cash
collateral or a supporting letter of credit in accordance with Section 2.4 of
the Credit Agreement.

                  "PATENT LICENSES" shall mean all agreements providing for the
granting of any right in or to Patents (whether such Grantor is licensee or
licensor thereunder) including, without limitation, each agreement referred to
in Schedule 4.7(D) (as such schedule may be amended or supplemented from time to
time).

                  "PATENTS" shall mean all United States and foreign patents and
applications for letters patent throughout the world, including, but not limited
to each patent and patent application referred to in Schedule 4.7(C) (as such
schedule may be amended or supplemented from time to time), all reissues,
divisions, continuations, continuations-in-part, extensions, renewals, and
reexaminations of any of the foregoing, all rights corresponding thereto
throughout the world, and all proceeds of the foregoing including, without
limitation, licenses, royalties, income, payments, claims, damages, and proceeds
of suit and the right to sue for past, present and future infringements of any
of the foregoing.

                  "PERMITTED LIEN" shall mean (i) at any time on or prior to the
First Priority Termination Date, a Permitted Lien as defined in the Credit
Agreement and (ii) at any time after the First Priority Termination Date, a
Permitted Lien as defined in the Rollover Note Indenture.

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                  "PLEDGED DEBT" shall mean all Indebtedness owed to such
Grantor, including, without limitation, all Indebtedness described on Schedule
4.4(A) under the heading "Pledged Debt" (as such schedule may be amended or
supplemented from time to time), issued by the obligors named therein, the
instruments evidencing such Indebtedness, and all interest, cash, instruments
and other property or proceeds from time to time received, receivable or
otherwise distributed in respect of or in exchange for any or all of such
Indebtedness.

                  "PLEDGED EQUITY INTERESTS" shall mean all Pledged Stock,
Pledged LLC Interests, Pledged Partnership Interests and Pledged Trust
Interests.

                  "PLEDGED LLC INTERESTS" shall mean all interests in any
limited liability company including, without limitation, all limited liability
company interests listed on Schedule 4.4(A) under the heading "Pledged LLC
Interests" (as such schedule may be amended or supplemented from time to time)
and the certificates, if any, representing such limited liability company
interests and any interest of such Grantor on the books and records of such
limited liability company or on the books and records of any securities
intermediary pertaining to such interest and all dividends, distributions, cash,
warrants, rights, options, instruments, securities and other property or
proceeds from time to time received, receivable or otherwise distributed in
respect of or in exchange for any or all of such limited liability company
interests; provided, that Pledged LLC Interests shall not include Excluded
Subsidiary Interests.

                  "PLEDGED PARTNERSHIP INTERESTS" shall mean all interests in
any general partnership, limited partnership, limited liability partnership or
other partnership including, without limitation, all partnership interests
listed on Schedule 4.4(A) under the heading "Pledged Partnership Interests" (as
such schedule may be amended or supplemented from time to time) and the
certificates, if any, representing such partnership interests and any interest
of such Grantor on the books and records of such partnership or on the books and
records of any securities intermediary pertaining to such interest and all
dividends, distributions, cash, warrants, rights, options, instruments,
securities and other property or proceeds from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all of such
partnership interests; provided, that Pledged Partnership Interests shall not
include Excluded Subsidiary Interests.

                  "PLEDGED TRUST INTERESTS" shall mean all interests in a
Delaware business trust or other trust including, without limitation, all trust
interests listed on Schedule 4.4(A) under the heading "Pledged Trust Interests"
(as such schedule may be amended or supplemented from time to time) and the
certificates, if any, representing such trust interests and any interest of such
Grantor on the books and records of such trust or on the books and records of
any securities intermediary pertaining to such interest and all dividends,
distributions, cash, warrants, rights, options, instruments, securities and
other property or proceeds from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of such trust interests;
provided, that Pledged Trust Interests shall not include Excluded Subsidiary
Interests.

                  "PLEDGED STOCK" shall mean all shares of capital stock owned
by such Grantor, including, without limitation, all shares of capital stock
described on Schedule 4.4(A) under the heading "Pledged Stock" (as such schedule
may be amended or supplemented from time to time), and the certificates, if any,
representing such shares and any interest of such Grantor in the entries on the
books of the issuer of such shares or on the books of any securities
intermediary pertaining to such shares, and all dividends, distributions, cash,
warrants, rights, options, instruments, securities and other property or
proceeds from time to time received, receivable or otherwise

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distributed in respect of or in exchange for any or all of such shares;
provided, that Pledged Stock shall not include Excluded Subsidiary Interests.

                  "PLEDGE SUPPLEMENT" shall mean any supplement to this
agreement in substantially the form of Exhibit A.

                  "PROCEEDS" shall mean: (i) all "proceeds" as defined in
Article 9 of the UCC, (ii) payments or distributions made with respect to any
Investment Related Property and (iii) whatever is receivable or received when
Collateral or proceeds are sold, exchanged, collected or otherwise disposed of,
whether such disposition is voluntary or involuntary.

                  "RECEIVABLES" shall mean all rights to payment, whether or not
earned by performance, for goods or other property sold, leased, licensed,
assigned or otherwise disposed of, or services rendered or to be rendered,
including, without limitation all such rights constituting or evidenced by any
Account, Chattel Paper, Instrument, General Intangible or Investment Related
Property, together with all of Grantor's rights, if any, in any goods or other
property giving rise to such right to payment and all Collateral Support and
Supporting Obligations related thereto and all Receivables Records.

                  "RECEIVABLES RECORDS" shall mean (i) all original copies of
all documents, instruments or other writings or electronic records or other
Records evidencing the Receivables, (ii) all books, correspondence, credit or
other files, Records, ledger sheets or cards, invoices, and other papers
relating to Receivables, including, without limitation, all tapes, cards,
computer tapes, computer discs, computer runs, record keeping systems and other
papers and documents relating to the Receivables, whether in the possession or
under the control of Grantor or any computer bureau or agent from time to time
acting for Grantor or otherwise, (iii) all evidences of the filing of financing
statements and the registration of other instruments in connection therewith,
and amendments, supplements or other modifications thereto, notices to other
creditors or secured parties, and certificates, acknowledgments, or other
writings, including, without limitation, lien search reports, from filing or
other registration officers, (iv) all credit information, reports and memoranda
relating thereto and (v) all other written or electronic forms of information
related in any way to the foregoing or any Receivable.

                  "RECORD" shall have the meaning specified in Article 9 of the
UCC.

                  "ROLLOVER NOTES" shall mean the Second Priority Secured Notes
due 2009 issued under the Rollover Note Indenture.

                  "ROLLOVER NOTE INDENTURE" shall have the meaning set forth in
the recitals.

                  "ROLLOVER NOTE TRUSTEE" shall have the meaning set forth in
the recitals.

                  "ROLLOVER NOTEHOLDERS" shall mean those entities from time to
time holding the Rollover Notes.

                  "SECOND PRIORITY OBLIGATIONS" shall mean all obligations of
any nature of any Grantor from time to time owed to the Rollover Note Trustee or
to any Rollover Noteholder under any Rollover Note or the Rollover Note
Indenture, whether for principal, premium, if any, or interest (including
interest which, but for the filing of a petition in bankruptcy with respect to
any Grantor, would have accrued on any Second Priority Obligation, whether or
not a claim is allowed against such Grantor for such interest in the related
bankruptcy proceeding) fees,

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expenses, indemnification or otherwise and all sums payable by the Grantors to
the Joint Collateral Agent under the Senior Note Documents.

                  "SECOND PRIORITY SECURED PARTIES" shall mean the Joint
Collateral Agent, the Rollover Noteholders and the Rollover Note Trustee.

                  "SECURED OBLIGATIONS" shall mean, collectively, the First
Priority Obligations and the Second Priority Obligations.

                  "SECURED PARTIES" shall mean collectively, the First Priority
Secured Parties and the Second Priority Secured Parties.

                  "SECURITIES ACCOUNTS" (i) shall mean all "securities accounts"
as defined in Article 8 of the UCC and (ii) shall include, without limitation,
all of the accounts listed on Schedule 4.4(A) under the heading "Securities
Accounts" (as such schedule may be amended or supplemented from time to time).

                  "SENIOR NOTE DOCUMENTS" shall have the meaning assigned in the
Rollover Note Indenture.

                  "SUPPORTING OBLIGATION" shall mean all "supporting
obligations" as defined in Article 9 of the UCC.

                  "TAX CODE" shall mean the United States Internal Revenue Code
of 1986, as amended from time to time.

                  "TRADEMARK LICENSES" shall mean any and all agreements
providing for the granting of any right in or to Trademarks (whether such
Grantor is licensee or licensor thereunder) including, without limitation, each
agreement referred to in Schedule 4.7(F) (as such schedule may be amended or
supplemented from time to time).

                  "TRADEMARKS" shall mean all United States, state and foreign
trademarks, trade names, corporate names, company names, business names,
fictitious business names, internet domain names, trade styles, service marks,
certification marks, collective marks, logos, other source or business
identifiers, designs and general intangibles of a like nature, all registrations
and applications for any of the foregoing including, but not limited to the
registrations and applications referred to in Schedule 4.7(E) (as such schedule
may be amended or supplemented from time to time), all extensions or renewals of
any of the foregoing, all of the goodwill of the business connected with the use
of and symbolized by the foregoing, the right to sue for past, present and
future infringement or dilution of any of the foregoing or for any injury to
goodwill, and all proceeds of the foregoing, including, without limitation,
licenses, royalties, income, payments, claims, damages, and proceeds of suit.

                  "TRADE SECRET LICENSES" shall mean any and all agreements
providing for the granting of any right in or to Trade Secrets (whether such
Grantor is licensee or licensor thereunder) including, without limitation, each
agreement referred to in Schedule 4.7(G) (as such schedule may be amended or
supplemented from time to time).

                  "TRADE SECRETS" shall mean all trade secrets and all other
confidential or proprietary information and know-how now or hereafter owned or
used in, or contemplated at any time for use in, the business of such Grantor
that gives the business a competitive advantage (all of

                                       9
<PAGE>

the foregoing being collectively called a "Trade Secret"), whether or not such
Trade Secret has been reduced to a writing or other tangible form, including all
documents and things embodying, incorporating, or referring in any way to such
Trade Secret, the right to sue for past, present and future infringement of any
Trade Secret, and all proceeds of the foregoing, including, without limitation,
licenses, royalties, income, payments, claims, damages, and proceeds of suit;
provided, that Trade Secrets shall not include any patient information.

                  "TRANSACTION DOCUMENTS" shall mean the Credit Documents and
the Senior Note Documents.

                  "UCC" shall mean the Uniform Commercial Code as in effect from
time to time in the State of Delaware or, when the context implies, the Uniform
Commercial Code as in effect from time to time in any other applicable
jurisdiction.

                  "UNITED STATES" shall mean the United States of America.

         1.2      DEFINITIONS; INTERPRETATION.All capitalized terms used herein
(including the preamble and recitals hereto) and not otherwise defined herein
shall have the meanings ascribed thereto in the Credit Agreement or, if not
defined therein, in the UCC. References to "Sections," "Exhibits" and
"Schedules" shall be to Sections, Exhibits and Schedules, as the case may be, of
this Agreement unless otherwise specifically provided. Section headings in this
Agreement are included herein for convenience of reference only and shall not
constitute a part of this Agreement for any other purpose or be given any
substantive effect. Any of the terms defined herein may, unless the context
otherwise requires, be used in the singular or the plural, depending on the
reference. The use herein of the word "include" or "including", when following
any general statement, term or matter, shall not be construed to limit such
statement, term or matter to the specific items or matters set forth immediately
following such word or to similar items or matters, whether or not nonlimiting
language (such as "without limitation" or "but not limited to" or words of
similar import) is used with reference thereto, but rather shall be deemed to
refer to all other items or matters that fall within the broadest possible scope
of such general statement, term or matter. If any conflict or inconsistency
exists at any time on or prior to the First Priority Termination Date between
this Agreement, the Credit Agreement and/or the Rollover Note Indenture, the
Credit Agreement shall govern. If any conflict or inconsistency exists at any
time after the First Priority Termination Date between this Agreement and the
Rollover Note Indenture, the Rollover Note Indenture shall govern. All
references herein to provisions of the UCC shall include all successor
provisions under any subsequent version or amendment to any Article of the UCC.

SECTION 2. GRANT OF SECURITY.

         2.1      GRANT OF SECURITY. Each Grantor hereby assigns and transfers
to the Joint Collateral Agent, and hereby grants to the Joint Collateral Agent,
a security interest and continuing lien on all of such Grantor's right, title
and interest in, to and under all personal property of such Grantor including,
but not limited to the following, in each case whether now owned or existing or
hereafter acquired or arising and wherever located (all of which being
hereinafter collectively referred to as the "COLLATERAL"):

                  (a)      Accounts;

                  (b)      Chattel Paper;

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<PAGE>

                  (c)      Documents;

                  (d)      General Intangibles;

                  (e)      Goods;

                  (f)      Instruments;

                  (g)      Insurance;

                  (h)      Intellectual Property;

                  (i)      Investment Related Property;

                  (j)      Letter of Credit Rights;

                  (k)      Money;

                  (l)      Receivables and Receivable Records;

                  (m)      Commercial Tort Claims;

                  (n)      to the extent not otherwise included above, all
Collateral Records, Collateral Support and Supporting Obligations relating to
any of the foregoing; and

                  (o)      to the extent not otherwise included above, all
Proceeds, products, accessions, rents and profits of or in respect of any of the
foregoing.

         2.2      CERTAIN LIMITED EXCLUSIONS. Notwithstanding anything herein to
the contrary, in no event shall the security interest granted under Section 2.1
hereof attach to, or the term "Collateral" be deemed to include, (a) any
Excluded Property, Government Receivables, Lease, Assignment Agreement, license,
contract, property rights or agreement to which any Grantor is a party or any of
its rights or interests thereunder if, and for so long as, the grant of such
security interest shall constitute or result in (i) the abandonment,
invalidation or unenforceability of any right, title or interest of any Grantor
therein or (ii) a breach or termination pursuant to the terms of, or a default
under, any such Government Receivable, Excluded Property Document, Lease,
Assigned Agreement or other license, contract, property rights or agreement or
the violation of any applicable law (other than to the extent that any such term
would be rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409
of the UCC (or any successor provision or provisions) of any relevant
jurisdiction or any other applicable law (including the Bankruptcy Code) or
principles of equity); provided, however that such security interest shall
attach immediately at such time as the condition causing such abandonment,
invalidation or unenforceability shall be remedied and to the extent severable,
shall attach immediately to any portion of such Excluded Property, Government
Receivables, Lease, Assigned Agreement or other license, contract, property
rights or agreement that does not result in any of the consequences specified in
(i) or (ii) above; or (b) in any of the outstanding capital stock of a
Controlled Foreign Corporation in excess of 65% of the voting power of all
classes of capital stock of such Controlled Foreign Corporation entitled to
vote; provided that immediately upon the amendment of the Tax Code to allow the
pledge of a greater percentage of the voting power of capital stock in a
Controlled Foreign Corporation without adverse tax consequences, the

                                       11
<PAGE>

Collateral shall include, and the security interest granted by each Grantor
shall attach to, such greater percentage of capital stock of each Controlled
Foreign Corporation.

SECTION 3. SECURITY FOR OBLIGATIONS; GRANTORS REMAIN LIABLE.

         3.1      SECURITY FOR OBLIGATIONS.This Agreement secures, and the
Collateral is collateral security for, the prompt and complete payment or
performance in full when due, whether at stated maturity, by required
prepayment, declaration, acceleration, demand or otherwise (including the
payment of amounts that would become due but for the operation of the automatic
stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. ss.362(a) (and any
successor provision thereof)), of all Secured Obligations.

         CONTINUING LIABILITY UNDER COLLATERAL.Notwithstanding anything herein
to the contrary, (i) each Grantor shall remain liable for all obligations under
the Collateral and nothing contained herein is intended or shall be a delegation
of duties to the Joint Collateral Agent or any other Secured Party, (ii) each
Grantor shall remain liable under each of the agreements included in the
Collateral, including, without limitation, any agreements relating to Pledged
Partnership Interests or Pledged LLC Interests, to perform all of the
obligations undertaken by it thereunder all in accordance with and pursuant to
the terms and provisions thereof and neither the Joint Collateral Agent nor any
Secured Party shall have any obligation or liability under any of such
agreements by reason of or arising out of this Agreement or any other document
related thereto nor shall the Joint Collateral Agent nor any Secured Party have
any obligation to make any inquiry as to the nature or sufficiency of any
payment received by it or have any obligation to take any action to collect or
enforce any rights under any agreement included in the Collateral, including,
without limitation, any agreements relating to Pledged Partnership Interests or
Pledged LLC Interests and (iii) the exercise by the Joint Collateral Agent of
any of its rights hereunder shall not release any Grant or from any of its
duties or obligations under the contracts and agreements included in the
Collateral.

SECTION 4. REPRESENTATIONS AND WARRANTIES AND COVENANTS.

         4.1      GENERALLY. (a) Representations and Warranties. Each Grantor
hereby represents and warrants to the Joint Collateral Agent and each other
Secured Party, on the Closing Date (after giving effect to the Reorganization)
and on each Credit Date, that:

                           (i)      with respect to any Collateral in excess of
         $100,000 individually or $1,000,000 in the aggregate, it owns such
         Collateral purported to be owned by it or otherwise has the rights it
         purports to have in each item of such Collateral and, as to all such
         Collateral whether now existing or hereafter acquired, will continue to
         own or have such rights in each item of the Collateral,

                           (ii)     the Collateral granted by such Grantor is
         free and clear of any and all Liens, rights or claims of all other
         Persons other than Permitted Liens, including, without limitation,
         liens arising as a result of such Grantor becoming bound (as a result
         of merger or otherwise) as debtor under a security agreement entered
         into by another Person;

                           (iii)    it has indicated on Schedule 4.1(A)(as such
         schedule may be amended or supplemented from time to time): (w) the
         type of organization of such Grantor, (x) the jurisdiction of
         organization of such Grantor, (y) its organizational identification
         number, to the extent issued by the jurisdiction of organization, and
         (z) the jurisdiction where the chief executive office or its sole place
         of business is (or the

                                       12
<PAGE>

         principal residence if such Grantor is a natural person), and for the
         one-year period preceding the date hereof has been, located.

                           (iv)     the full legal name of such Grantor is as
         set forth on Schedule 4.1(A) and it has not done in the last five (5)
         years, and does not do, business under any other name (including any
         trade-name or fictitious business name) except for those names set
         forth on Schedule 4.1(B) (as such schedule may be amended or
         supplemented from time to time);

                           (v)      except as provided on Schedule 4.1(C), it
         has not changed its name, jurisdiction of organization, chief executive
         office or sole place of business or its corporate structure in any way
         (e.g., by merger, consolidation, change in corporate form or otherwise)
         within the past five (5) years;

                           (vi)     it has not within the last five (5) years
         become bound (whether as a result of merger or otherwise) as debtor
         under a security agreement entered into by another Person, which has
         not heretofore been terminated other than the agreements identified on
         Schedule 4.1(D) hereof (as such schedule may be amended or supplemented
         from time to time);

                           (vii)    with respect to each agreement identified on
         Schedule 4.1(D), it has indicated on Schedule 4.1(A) and Schedule
         4.1(B) the information required pursuant to Section 4.1(a)(ii), (iii)
         and (iv) with respect to the debtor under each such agreement;

                           (viii)   upon the filing of all UCC financing
         statements naming each Grantor as debtor and the Joint Collateral Agent
         as secured party and describing the Collateral in the filing offices
         set forth opposite such Grantor's name on Schedule 4.1(E) hereof (as
         such schedule may be amended or supplemented from time to time) and, to
         the extent not subject to Article 9 of the UCC, upon the recordation of
         the security interests granted hereunder in Patents, Trademarks and
         Copyrights in the applicable intellectual property registries, and the
         registration of all unregistered Copyrights, and other filings
         delivered by each Grantor, and the delivery of an executed control
         agreement for each Concentration Account, Insurance Concentration
         Account and Collection Account listed in Items (a)(8)(A), (a)(8)(B) and
         (a)(8)(C), respectively of Schedule 4.4 hereof (as such schedule may be
         amended or supplemented from time to time) in accordance with Section
         4.4.4 hereof, the security interests granted to the Joint Collateral
         Agent hereunder in the Collateral other than Deposit Accounts not
         listed on Schedule 4.4 hereof (as such schedule may be amended or
         supplemented from time to time), constitute valid and perfected first
         priority Liens (subject only to Permitted Liens and to the rights of
         the United States government (including any agency or department
         thereof) with respect to Government Receivables) on all of the
         Collateral;

                           (ix)     except for the filings contemplated by
         clause (viii) above and as otherwise indicated on Schedule 4.1(F), all
         actions and consents, including all filings, notices, registrations and
         recordings necessary or desirable for the exercise by the Joint
         Collateral Agent of the voting or other rights provided for in this
         Agreement or the exercise of remedies in respect of the Collateral have
         been made or obtained;

                           (x)      other than the financing statements filed in
         favor of the Joint Collateral Agent, no effective UCC financing
         statement, fixture filing or other instrument similar in effect under
         any applicable law covering all or any part of the Collateral is on

                                       13
<PAGE>

         file in any filing or recording office except for (x) financing
         statements identified on Schedule 4.1(G) for which proper termination
         statements have been delivered to the Joint Collateral Agent for
         filing, (y) other Liens being discharged in connection with the
         consummation of the Plan of Reorganization (whether or not termination
         statements have been delivered to the Joint Collateral Agent) and (z)
         financing statements filed in connection with Permitted Liens;

                           (xi)     no authorization, approval or other action
         by, and no notice to or filing with, any Governmental Authority or
         regulatory body is required for either (i) the pledge or grant by any
         Grantor of the Liens purported to be created in favor of the Joint
         Collateral Agent hereunder or (ii) the exercise by Joint Collateral
         Agent of any rights or remedies in respect of any Collateral (whether
         specifically granted or created hereunder or created or provided for by
         applicable law), except (A) for the filings contemplated by clause
         (viii) above and (B) as may be required, in connection with the
         disposition of any Investment Related Property, by laws generally
         affecting the offering and sale of Securities;

                           (xii)    all information supplied by any Grantor with
         respect to any of the Collateral (in each case taken as a whole with
         respect to any particular Collateral) is accurate and complete in all
         material respects;

                           (xiii)   none of the Collateral constitutes, or is
         the Proceeds of, "farm products" (as defined in the UCC);

                           (xiv)    it does not own any "as extracted
         collateral" (as defined in the UCC) or any timber to be cut; and

                           (xv)     such Grantor has been duly organized as an
         entity of the type as set forth opposite such Grantor's name on
         Schedule 4.1(A) solely under the laws of the jurisdiction as set forth
         opposite such Grantor's name on Schedule 4.1(A) and remains duly
         existing as such. Such Grantor has not filed any certificates of
         domestication, transfer or continuance in any other jurisdiction.

                  (b)      Covenants and Agreements. Each Grantor hereby
covenants and agrees with the Joint Collateral Agent and each other Secured
Party that from and after the date of this Agreement until the payment in full
of all Secured Obligations, the cancellation or termination of the Commitments
and the cancellation or expiration of all Outstanding Letters of Credit, that:

                           (i)      except for the security interest created by
         this Agreement, it shall not create or suffer to exist any Lien upon or
         with respect to any of the Collateral, except Permitted Liens, and such
         Grantor shall defend the Collateral against all Persons at any time
         claiming any interest therein;

                           (ii)     it shall not produce, use or permit any
         Collateral to be used unlawfully or in violation of any provision of
         this Agreement or any applicable statute, regulation or ordinance or
         any policy of insurance covering the Collateral;

                           (iii)    it shall not change such Grantor's name,
         identity, corporate structure (e.g., by merger, consolidation, change
         in corporate form or otherwise) sole place of business, chief executive
         office, type of organization or jurisdiction of organization unless it
         shall have (a) notified the Joint Collateral Agent in writing, by

                                       14
<PAGE>

         executing and delivering to the Joint Collateral Agent a completed
         Pledge Supplement, substantially in the form of Exhibit A attached
         hereto, together with all Supplements to Schedules necessary to notify
         the Joint Collateral Agent of changes, additions, dispositions or
         substitutions of the Collateral thereto, at least ten (10) Business
         Days prior to any such change, identifying such new proposed name,
         identity, corporate structure, sole place of business, chief executive
         office or jurisdiction of organization and providing such other
         information in connection therewith as the Joint Collateral Agent may
         reasonably request and (b) taken all actions necessary or advisable to
         maintain the continuous validity, perfection and the same or better
         priority of the Joint Collateral Agent's security interest in the
         Collateral intended to be granted and agreed to hereby; and

                           (iv)     it shall not take or permit any action which
         could materially impair the Joint Collateral Agent's rights in the
         Collateral.

         4.2      EQUIPMENT AND INVENTORY. (a) Representations and Warranties.
Each Grantor represents and warrants to the Joint Collateral Agent and each
other Secured Party, on the Closing Date and on each Credit Date, that:

                           (i)      all of the Equipment and Inventory included
         in the Collateral in excess of $300,000 individually or $2,000,000 in
         the aggregate, is and has been kept for the past five (5) years only at
         the locations specified in Schedule 4.2 (as such schedule may be
         amended or supplemented from time to time) (whether or not listed under
         such Grantor's name); and

                           (ii)     none of the Inventory or Equipment in excess
         of $500,000 in the aggregate is in the possession of an issuer of a
         negotiable document (as defined in Section 7-104 of the UCC) therefor
         or otherwise in the possession of a bailee or a warehouseman.

                  (b)      Covenants and Agreements. Each Grantor hereby
covenants and agrees with the Joint Collateral Agent and each other Secured
Party that from and after the date of this Agreement until the payment in full
of all Secured Obligations, the cancellation or termination of the Commitments
and the cancellation or expiration of all Outstanding Letters of Credit that:

                           (i)      with respect to any Equipment, Inventory and
         any Documents evidencing any Equipment and Inventory in excess of
         $300,000 individually or $2,000,000 in the aggregate, it shall keep
         such Equipment, Inventory and any Documents evidencing any Equipment
         and Inventory at any location specified on Schedule 4.2 (as such
         schedule may be amended or supplemented from time to time) (whether or
         not listed under such Grantor's name) unless it shall have (a) notified
         the Joint Collateral Agent in writing, by executing and delivering to
         the Joint Collateral Agent a completed Pledge Supplement, substantially
         in the form of Exhibit A attached hereto, together with all Supplements
         to Schedules thereto, at least thirty (30) days prior to any change in
         locations, identifying such new locations and providing such other
         information in connection therewith as the Joint Collateral Agent may
         reasonably request and (b) taken all actions necessary or advisable to
         maintain the continuous validity, perfection and the same or better
         priority of the Joint Collateral Agent's security interest in the
         Collateral intended to be granted and agreed to hereby, or to enable
         the Joint Collateral Agent to exercise and enforce its rights and
         remedies hereunder, with respect to such Equipment and Inventory;

                                       15
<PAGE>

                           (ii)     it shall keep correct and accurate records
         of the Inventory, as is customarily maintained under similar
         circumstances by Persons of established reputation engaged in similar
         business, and in any event in conformity with GAAP;

                           (iii)    it shall not deliver any Document evidencing
         any Equipment and Inventory to any Person other than the issuer of such
         Document to claim the Goods evidenced therefor or the Joint Collateral
         Agent;

                           (iv)     if any Equipment or Inventory is in
         possession or control of any third party, each Grantor shall join with
         the Joint Collateral Agent in notifying the third party of the Joint
         Collateral Agent's security interest and obtaining an acknowledgment
         from the third party that it is holding the Equipment and Inventory for
         the benefit of the Joint Collateral Agent; and

                           (v)      with respect to any item of Equipment owned
         by such Grantor which is covered by a certificate of title under a
         statute of any jurisdiction under the law of which indication of a
         security interest on such certificate is required as a condition of
         perfection thereof (A) provide information with respect to any such
         Equipment in excess of $300,000 individually or $2,000,000 in the
         aggregate, (B) execute and file with the registrar of motor vehicles or
         other appropriate authority in such jurisdiction an application or
         other document requesting the notation or other indication of the
         security interest created hereunder on such certificate of title and
         (C) deliver to the Joint Collateral Agent copies of all such
         applications or other documents filed during such calendar quarter and
         copies of all such certificates of title issued during such calendar
         quarter indicating the security interest created hereunder in the items
         of Equipment covered thereby.

         4.3      RECEIVABLES. (a) Representations and Warranties. Each Grantor
represents and warrants to the Joint Collateral Agent and each other Secured
Party, on the Closing Date and on each Credit Date, that, no Receivable is
evidenced by, or constitutes, an Instrument or Chattel Paper which has not been
delivered to, or otherwise subjected to the control of, the Joint Collateral
Agent to the extent required by, and in accordance with, Section 4.3(c).

                  (b)      Covenants and Agreements: Each Grantor hereby
covenants and agrees with the Joint Collateral Agent and each other Secured
Party that from and after the date of this Agreement until the payment in full
of all Secured Obligations, the cancellation or termination of the Commitments
and the cancellation or expiration of all Outstanding Letters of Credit that:

                           (i)      it shall keep and maintain at its own cost
         and expense satisfactory and complete records of the Receivables,
         including, but not limited to, the originals of all documentation with
         respect to all Receivables and records of all payments received and all
         credits granted on the Receivables, all merchandise returned and all
         other dealings therewith;

                           (ii)     it shall promptly transfer or cause to be
         transferred all funds arising from the collection of all Receivables
         (A) to a Deposit Account of any Grantor and (B) in any event, no later
         than two (2) Business Days after transfer to the account in (A) above,
         to a Concentration Account listed on Schedule 4.4(A)(8)(a) hereto (as
         such schedule may be amended or supplemented from time to time) or,
         upon the occurrence of and during the existence of an Event of Default
         at the direction of the Joint Collateral

                                       16
<PAGE>

         Agent, to a Collection Account listed on Schedule 4.4(A)(8)(c) hereto
         (as such schedule may be amended or supplemented from time to time);

                           (iii)    it shall perform in all material respects
         all of its obligations with respect to the Receivables as it deems
         appropriate or advisable in the exercise of its business judgment;

                           (iv)     it shall not amend, modify, terminate or
         waive any provision of any Receivable in any manner which could
         reasonably be expected to have a Material Adverse Effect. Other than in
         the ordinary course of business as generally conducted by it on and
         prior to the date hereof, and except as otherwise provided in
         subsection (v) below, following an Event of Default, such Grantor shall
         not (w) grant any extension or renewal of the time of payment of any
         Receivable, (x) compromise or settle any dispute, claim or legal
         proceeding with respect to any Receivable for less than the total
         unpaid balance thereof, (y) release, wholly or partially, any Person
         liable for the payment thereof or (z) allow any credit or discount
         thereon;

                           (v)      except as otherwise provided in this
         subsection, each Grantor shall continue to collect, or cause to be
         collected, all amounts due or to become due to such Grantor under the
         Receivables and any Supporting Obligation and diligently exercise each
         material right it may have under any Receivable, any Supporting
         Obligation or Collateral Support, as it deems appropriate or advisable
         in the exercise of its business judgment, in each case, at its own
         expense, and in connection with such collections and exercise, such
         Grantor shall take such action as such Grantor or, during the existence
         of an Event of Default, the Joint Collateral Agent may deem necessary
         or advisable. Notwithstanding the foregoing, during the existence of an
         Event of Default, the Joint Collateral Agent shall have the right at
         any time to notify, or require any Grantor to notify (and if so, such
         Grantor shall so notify), any Account Debtor of the Joint Collateral
         Agent's security interest in the Receivables and any Supporting
         Obligation and, in addition, at any time following the occurrence and
         during the continuation of an Event of Default, the Joint Collateral
         Agent may: (1) direct the Account Debtors under any Receivables to make
         payment of all amounts due or to become due to such Grantor thereunder
         directly to the Joint Collateral Agent; (2) notify, or require any
         Grantor to notify, each Person maintaining a lockbox or similar
         arrangement to which Account Debtors under any Receivables have been
         directed to make payment to remit all amounts representing collections
         on checks and other payment items from time to time sent to or
         deposited in such lockbox or other arrangement directly to the Joint
         Collateral Agent; and (3) enforce, at the expense of such Grantor,
         collection of any such Receivables and to adjust, settle or compromise
         the amount or payment thereof, in the same manner and to the same
         extent as such Grantor might have done; provided, the Joint Collateral
         Agent shall not take any of the actions set forth in this sentence if
         and to the extent that such action is prohibited under any federal or
         state law. If the Joint Collateral Agent notifies any Grantor that it
         has elected to collect the Receivables in accordance with the preceding
         sentence, any payments of Receivables received by such Grantor shall be
         forthwith (and in any event within two (2) Business Days) deposited by
         such Grantor in the exact form received, duly indorsed by such Grantor
         to the Joint Collateral Agent if required, in a Collection Account
         maintained under the sole dominion and control of the Joint Collateral
         Agent, and until so turned over, all amounts and proceeds (including
         checks and other instruments) received by such Grantor in respect of
         the Receivables, any Supporting Obligation or Collateral Support shall

                                       17
<PAGE>

         be received in trust for the benefit of the Joint Collateral Agent
         hereunder and shall be segregated from other funds of such Grantor and
         such Grantor shall not adjust, settle or compromise the amount or
         payment of any Receivable, or release wholly or partly any Account
         Debtor or obligor thereof, or allow any credit or discount thereon; and

                           (vi)     it shall use its best efforts to keep in
         full force and effect any Supporting Obligation or Collateral Support
         relating to any Receivable.

                  (c)      Delivery and Control of Receivables. With respect to
any Receivables in excess of $100,000 individually or $1,000,000 in the
aggregate that is evidenced by, or constitutes, Chattel Paper or Instruments,
each Grantor shall cause each originally executed copy thereof to be delivered
to the Joint Collateral Agent (or its agent or designee) appropriately indorsed
to the Joint Collateral Agent or indorsed in blank: (i) with respect to any such
Receivables in existence on the date hereof, on or prior to the date hereof and
(ii) with respect to any such Receivables hereafter arising, within ten (10)
Business Days after such Grantor acquires rights therein. With respect to any
Receivables in excess of $100,000 individually or $1,000,000 in the aggregate
which would constitute "electronic chattel paper" under Article 9 of the UCC,
each Grantor shall take all steps necessary to give the Joint Collateral Agent
control over such Receivables (within the meaning of Section 9-105 of the UCC):
(i) with respect to any such Receivables in existence on the date hereof, on or
prior to the date hereof and (ii) with respect to any such Receivables hereafter
arising, within ten (10) Business Days after such Grantor acquiring rights
therein. Any Receivable not otherwise required to be delivered or subjected to
the control of the Joint Collateral Agent in accordance with this subsection (c)
shall be delivered or subjected to such control upon request of the Joint
Collateral Agent.

         4.4      INVESTMENT RELATED PROPERTY.4.4.1 INVESTMENT RELATED PROPERTY
GENERALLY

                  (a)      Covenants and Agreements. Each Grantor hereby
covenants and agrees with the Joint Collateral Agent and each other Secured
Party from and after the date of this Agreement until the payment in full of all
Secured Obligations, the cancellation or termination of the Commitments and the
cancellation or expiration of all Outstanding Letters of Credit that:

                           (i)      in the event it acquires rights in any
         Investment Related Property which has not otherwise been deposited or
         credited to an Investment Account subject to the Joint Collateral
         Agent's "control" (within the meanings of Sections 8-106, 9-106 or
         9-104, as applicable, of the UCC) in accordance with Section 4.4.4(c)
         herein after the date hereof, it shall deliver to the Joint Collateral
         Agent a completed Pledge Supplement, substantially in the form of
         Exhibit A attached hereto, together with all Supplements to Schedules
         necessary to notify the Joint Collateral Agent of such acquisitions
         thereto, reflecting such new Investment Related Property and all other
         Investment Related Property. Notwithstanding the foregoing, it is
         understood and agreed that the security interest of the Joint
         Collateral Agent shall attach to all Investment Related Property
         immediately upon any Grantor's acquisition of rights therein and shall
         not be affected by the failure of any Grantor to deliver a supplement
         to Schedule 4.4 as required hereby;

                           (ii)     except as provided in the next sentence, in
         the event such Grantor receives any dividends, interest or
         distributions on any Investment Related Property, or any securities or
         other property upon the merger, consolidation, liquidation or
         dissolution of any issuer of any Investment Related Property, then (a)
         such dividends, interest or distributions and securities or other
         property shall be included in the definition of Collateral without
         further action and (b) such Grantor shall take all steps to ensure the
         validity, perfection, priority and, if applicable, control of the Joint
         Collateral Agent over

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<PAGE>

         such Investment Related Property (including, without limitation,
         delivery thereof to the Joint Collateral Agent). Notwithstanding the
         foregoing, so long as no Event of Default shall have occurred and be
         continuing, the Joint Collateral Agent authorizes each Grantor to
         retain all ordinary cash dividends and distributions paid in the normal
         course of the business of the issuer and consistent with the past
         practice of the issuer and all payments of principal and interest; and

                           (iii)    each Grantor consents to the grant by each
         other Grantor of a Security Interest in all Investment Related Property
         to the Joint Collateral Agent.

                  (b)      Delivery and Control.

                           (i)      Each Grantor agrees that (A) with respect to
         any Investment Related Property in which it currently has rights, it
         shall comply with the provisions of this 4.4.1(b) on or before the
         Closing Date or Credit Date, (B) with respect to any Investment Related
         Property hereafter acquired by such Grantor it shall comply with the
         provisions of this Section 4.4.1(b) immediately upon acquiring rights
         therein and (C) with respect to Pledged Debt as set forth in Schedule
         4.4(A)(5)(B) attached hereto, it shall comply with the provisions of
         Section 5.17(h) of the Credit Agreement, in each case in form and
         substance satisfactory to the Joint Collateral Agent. With respect to
         any Investment Related Property that is represented by a certificate or
         that is an "instrument" (other than any Investment Related Property
         credited to a Securities Account), it shall cause such certificate or
         instrument to be delivered to the Joint Collateral Agent, indorsed in
         blank by an "effective indorsement" (as defined in Section 8-107 of the
         UCC), regardless of whether such certificate constitutes a
         "certificated security" for purposes of the UCC. With respect to any
         Investment Related Property that is an "uncertificated security" for
         purposes of the UCC (other than any "uncertificated securities"
         credited to a Securities Account), it shall cause the issuer of such
         uncertificated security to either (i) register the Joint Collateral
         Agent as the registered owner thereof on the books and records of the
         issuer or (ii) execute an agreement substantially in the form of
         Exhibit B hereto, pursuant to which such issuer agrees to comply with
         the Joint Collateral Agent's instructions with respect to such
         uncertificated security without further consent by such Grantor.

                  (c)      Voting and Distributions.

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

         (1)      except as otherwise provided under the covenants and
                  agreements relating to investment related property in this
                  Agreement or elsewhere herein or in the Credit Agreement or,
                  at any time after the First Priority Termination Date, in the
                  Rollover Note Indenture, each Grantor shall be entitled to
                  exercise or refrain from exercising any and all voting and
                  other consensual rights pertaining to the Investment Related
                  Property or any part thereof; provided, no Grantor shall
                  exercise or refrain from exercising any such right if the
                  Joint Collateral Agent shall have notified such Grantor that,
                  in the Joint Collateral Agent's reasonable judgment, such
                  action would have a Material Adverse Effect; and

         (2)      the Joint Collateral Agent shall promptly execute and deliver
                  (or cause to be executed and delivered) to each Grantor all
                  proxies, and other instruments as

                                       19
<PAGE>

                  such Grantor may from time to time reasonably request for the
                  purpose of enabling such Grantor to exercise the voting and
                  other consensual rights when and to the extent which it is
                  entitled to exercise pursuant to clause (A) above.

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

         (1)      all rights of each Grantor to exercise or refrain from
                  exercising the voting and other consensual rights which it
                  would otherwise be entitled to exercise pursuant hereto shall
                  cease and all such rights shall thereupon become vested in the
                  Joint Collateral Agent who shall thereupon have the sole right
                  to exercise such voting and other consensual rights;

         (2)      in order to permit the Joint Collateral Agent to exercise the
                  voting and other consensual rights which it may be entitled to
                  exercise pursuant hereto and to receive all dividends and
                  other distributions which it may be entitled to receive
                  hereunder: (1) each Grantor shall promptly execute and deliver
                  (or cause to be executed and delivered) to the Joint
                  Collateral Agent all proxies, dividend payment orders and
                  other instruments as the Joint Collateral Agent may from time
                  to time reasonably request and (2) each Grantor acknowledges
                  that the Joint Collateral Agent may utilize the power of
                  attorney set forth in Section 6; and

         (3)      if the Event of Default is duly waived or otherwise ceases to
                  exist, then all such voting rights will automatically revert
                  to the appropriate Grantor and the Joint Collateral Agent
                  shall so confirm in writing upon any Grantor's written
                  request.

                  4.4.2    PLEDGED EQUITY INTERESTS

                  (a)      Representations and Warranties. Each Grantor hereby
represents and warrants to the Joint Collateral Agent and each other Secured
Party, on the Closing Date and on each Credit Date, that:

                           (i)      Schedule 4.4(A) (as such schedule may be
         amended or supplemented from time to time) sets forth under the
         headings "Pledged Stock, "Pledged LLC Interests," "Pledged Partnership
         Interests" and "Pledged Trust Interests," respectively, all of the
         Pledged Stock, Pledged LLC Interests, Pledged Partnership Interests and
         Pledged Trust Interests owned by any Grantor and such Pledged Equity
         Interests constitute the percentage of issued and outstanding shares of
         stock, percentage of membership interests, percentage of partnership
         interests or percentage of beneficial interest of the respective
         issuers thereof indicated on such Schedule;

                           (ii)     it is the record and beneficial owner of the
         Pledged Equity Interests free of all Liens, rights or claims of other
         Persons other than Permitted Liens, and there are no outstanding
         warrants, options or other rights to purchase, or shareholder, voting
         trust or similar agreements outstanding with respect to, or property
         that is convertible into, or that requires the issuance or sale of, any
         Pledged Equity Interests except as indicated on Schedule 4.4(A) (as
         such Schedule may be amended or supplemented from time to time);

                                       20
<PAGE>

                           (iii)    except as indicated on Schedule 4.1(F) and
         without limiting the generality of Section 4.1(a)(viii), no consent of
         any Person including any other general or limited partner, any other
         member of a limited liability company, any other shareholder or any
         other trust beneficiary is necessary or desirable, and has not been
         obtained, in connection with the creation, perfection or first priority
         status of the security interest of the Joint Collateral Agent in any
         Pledged Equity Interests or the exercise by the Joint Collateral Agent
         of the voting or other rights provided for in this Agreement or the
         exercise of remedies in respect thereof;

                           (iv)     none of the Pledged LLC Interests nor
         Pledged Partnership Interests are or represent interests in issuers
         that are: (a) registered as investment companies, (b) are dealt in or
         traded on securities exchanges or markets or (c) have opted to be
         treated as securities under the uniform commercial code of any
         jurisdiction;

                  (b)      Covenants and Agreements. Each Grantor hereby
covenants and agrees with the Joint Collateral Agent and each other Secured
Party that from and after the date of this Agreement until the payment in full
of all Secured Obligations, the cancellation or termination of the Commitments
and the cancellation or expiration of all Outstanding Letters of Credit that:

                           (i)      without the prior written consent of the
         Joint Collateral Agent, it shall not vote to enable or take any other
         action to: (a) amend or terminate any partnership agreement, limited
         liability company agreement, certificate of incorporation, by-laws or
         other organizational documents in any way that materially and adversely
         changes the rights of such Grantor with respect to any Investment
         Related Property or adversely affects the validity, perfection or
         priority of the Joint Collateral Agent's security interest, (b) permit
         any issuer of any Pledged Equity Interest to issue any additional
         stock, partnership interests, limited liability company interests or
         other equity interests of any nature other than to such Grantor or to
         issue securities convertible into or granting the right of purchase or
         exchange for any stock or other equity interest of any nature of such
         issuer, (c) other than as permitted under the Credit Agreement or, at
         any time after the First Priority Termination Date, the Rollover Note
         Indenture, permit any issuer of any Pledged Equity Interest to dispose
         of all or a material portion of their assets, (d) waive any default
         under or breach of any terms of organizational document relating to the
         issuer of any Pledged Equity Interest or the terms of any Pledged Debt
         except to the extent in such Grantor's business judgment, such
         enforcement is not in such Grantor's best interest, or (e) cause any
         issuer of any Pledged Partnership Interests or Pledged LLC Interests
         which are not securities (for purposes of the UCC) on the date hereof
         to elect or otherwise take any action to cause such Pledged Partnership
         Interests or Pledged LLC Interests to be treated as securities for
         purposes of the UCC; provided, however, notwithstanding the foregoing,
         if any issuer of any Pledged Partnership Interests or Pledged LLC
         Interests takes any such action in violation of the foregoing in this
         clause (e), such Grantor shall promptly notify the Joint Collateral
         Agent in writing of any such election or action and, in such event,
         shall take all steps necessary or advisable to establish the Joint
         Collateral Agent's "control" thereof;

                           (ii)     it shall comply with all of its obligations
         under any partnership agreement or limited liability company agreement
         relating to Pledged Partnership Interests or Pledged LLC Interests,
         other than obligations being contested in good faith or with respect to
         which Grantor believes in good faith that it has a set off claim and
         shall enforce all of its material rights with respect to any Investment
         Related Property except to

                                       21
<PAGE>

         the extent in Grantor's business judgment, such enforcement is not in
         Grantor's best interest; and

                           (iii)    each Grantor consents to the grant by each
         other Grantor of a security interest in all Investment Related Property
         to the Joint Collateral Agent and, without limiting the foregoing,
         consents to the transfer of any Pledged Partnership Interest and any
         Pledged LLC Interest to the Joint Collateral Agent or its nominee
         following an Event of Default and to the substitution of the Joint
         Collateral Agent or its nominee as a partner in any partnership or as a
         member in any limited liability company with all the rights and powers
         related thereto.

                  4.4.3    PLEDGED DEBT

                  (a)      Representations and Warranties. Each Grantor hereby
represents and warrants to the Joint Collateral Agent and each other Secured
Party, on the Closing Date and each Credit Date, that:

                           (i)      Schedule 4.4 (as such schedule may be
         amended or supplemented from time to time) sets forth under the heading
         "Pledged Debt" all of the Pledged Debt owned by any Grantor that is
         evidenced by an Instrument and, to the best of such Grantor's
         knowledge, all of such Pledged Debt has been duly authorized,
         authenticated or issued, and delivered and is the legal, valid and
         binding obligation of the issuers thereof and is not in default and
         constitutes all of the issued and outstanding inter-company
         Indebtedness evidenced by an instrument or certificated security of the
         respective issuers thereof owing to such Grantor.

                  (b)      Covenants and Agreements. Each Grantor hereby
covenants and agrees from and after the date of this Agreement until the payment
in full of all Secured Obligations, the cancellation or termination of the
Commitments and the cancellation or expiration of all Outstanding Letters of
Credit that:

                           (i)      it shall notify the Joint Collateral Agent
         of any default under any Pledged Debt (after the passage of any
         applicable grace or cure period) that has caused, either in any
         individual case or in the aggregate, a Material Adverse Effect.

                  4.4.4    INVESTMENT ACCOUNTS

                  (a)      Representations and Warranties. Each Grantor hereby
represents and warrants to the Joint Collateral Agent and each other Secured
Party, on the Closing Date and each Credit Date, that:

                           (i)      Schedule 4.4 hereto (as such schedule may be
         amended or supplemented from time to time) sets forth under the
         headings "Securities Accounts" and "Commodities Accounts,"
         respectively, all of the Securities Accounts and Commodities Accounts
         in which each Grantor has an interest. Each Grantor is the sole
         entitlement holder of each Securities Account and Commodities Account
         opposite its name, and such Grantor has not consented to, and is not
         otherwise aware of, any Person (other than the Joint Collateral Agent
         pursuant hereto) having "control" (within the meanings of Sections
         8-106 and 9-106 of the UCC) over, or any other interest in, any such
         Securities Account or Commodity Account or any securities or other
         property credited thereto;

                                       22
<PAGE>

                           (ii)     Schedules 4.4(A)(8)(a) and 4.4(A)(8)(b)
         hereto (as such schedules may be amended or supplemented from time to
         time) set forth under the headings "Deposit Accounts: Concentration
         Accounts" and "Deposit Accounts: Insurance Concentration Accounts" all
         of the Concentration Accounts and Insurance Concentration Accounts
         referred to in Schedule 4.29 and Section 5.5(e) of the Credit
         Agreement, respectively, and Schedule 4.4(A)(8)(c) hereto (as such
         schedule may be amended or supplemented from time to time) sets forth
         under the heading "Deposit Accounts: Collection Account," such other
         Deposit Accounts not listed in Schedule 4.4(A)(8)(a) or 4.4(A)(8)(b) in
         which each Grantor has an interest. Each Grantor is the sole account
         holder of each Deposit Account listed on Schedule 4.4(A)(8) opposite
         its name and such Grantor has not consented to, and is not otherwise
         aware of, any Person (other than the Joint Collateral Agent pursuant
         hereto) having either sole dominion and control (within the meaning of
         common law) or "control" (within the meaning of Section 9-104 of the
         UCC) over, or any other interest in, any such Deposit Account or any
         money or other property deposited therein; and

                           (iii)    Except as otherwise in compliance with
         Section 5.17(g) of the Credit Agreement, each Grantor has taken all
         actions necessary or desirable, including those specified in Section
         4.4.4(b) to: (a) establish the Joint Collateral Agent's "control"
         (within the meanings of Sections 8-106 and 9-106 or 9-104, as
         applicable of the UCC) over any portion of the Investment Related
         Property constituting Certificated Securities, Uncertificated
         Securities, Securities Accounts (other than Securities Accounts with
         outstanding fair market value or balance no greater than $50,000 in the
         aggregate at any time for all Grantors (the "De Minimis Securities
         Accounts")), Securities Entitlements (other than Securities
         Entitlements with outstanding fair market value no greater than $50,000
         in the aggregate at any time for all Grantors with respect to which is
         credited to a De Minimis Securities Account (the "De Minimis Securities
         Entitlements")), Concentration Accounts, Insurance Concentration
         Accounts, Collection Accounts or Commodities Accounts; and (b) to
         deliver all Instruments evidencing Pledged Debt to the Joint Collateral
         Agent.

                  (b)      Covenants and Agreement. Each Grantor hereby
covenants and agrees with the Joint Collateral Agent and each other Secured
Party that from and after the date of this Agreement until the payment in full
of all Secured Obligations, the cancellation or termination of the Commitments
and the cancellation or expiration of all Outstanding Letters of Credit that:

                           (i)      it shall not close or terminate any
         Concentration Account, Insurance Concentration Account or Collection
         Account without the prior consent of the Joint Collateral Agent and
         unless a successor or replacement account has been established with the
         consent of the Joint Collateral Agent with respect to which successor
         or replacement account a control agreement has been entered into by the
         appropriate Grantor, Joint Collateral Agent and securities intermediary
         or depository institution at which such successor or replacement
         account is to be maintained in accordance with the provisions of
         Section 4.4.4(c); and

                           (ii)     it shall transfer any and all funds or
         Securities Entitlements held in or credited to any De Minimis
         Securities Account with an outstanding fair market value or balance in
         excess of $50,000 in the aggregate for all Grantors to an Investment
         Account under the "control" of the Joint Collateral Agent (within the
         meaning of 8-106 and 9-106 or 9-104, as applicable of the UCC) in
         accordance with the provisions of Section 4.4.4(c).

                                       23
<PAGE>
                  (c)      Delivery and Control

                           (i)      Each Grantor agrees that with respect to any
         Investment Related Property in which it currently has rights it shall
         comply with the provisions of this Section 4.4.4(c) on or before the
         Credit Date and with respect to any Investment Related Property
         hereafter acquired by such Grantor it shall comply with the provisions
         of this Section 4.4.4(c) immediately upon acquiring rights therein.
         With respect to any Investment Related Property consisting of
         Securities Accounts (other than De Minimis Securities Accounts),
         Securities Entitlements (other than De Minimis Securities
         Entitlements), Concentration Accounts, Insurance Concentration Accounts
         or Collection Accounts, except as otherwise in compliance with Section
         5.17(g) of the Credit Agreement, it shall cause the securities
         intermediary or depositary institution, as the case may be, maintaining
         such Securities Account, Securities Entitlement, Concentration
         Accounts, Government Receivables Concentration Accounts or Collection
         Accounts to enter into an agreement substantially in the form of
         Exhibit C hereto, or otherwise in form and substance reasonably
         satisfactory to the Joint Collateral Agent, pursuant to which it shall
         agree to comply with the Joint Collateral Agent's "entitlement orders"
         or "instructions", as the case may be, without further consent by such
         Grantor. Each Grantor shall have entered into such control agreement or
         agreements with respect to: (i) any Securities Accounts (other than De
         Minimis Securities Accounts), Securities Entitlements (other than De
         Minimis Securities Entitlements), Concentration Accounts, Insurance
         Concentration Accounts or Collection Accounts that exist on the Credit
         Date, as of or prior to the Credit Date, except as otherwise in
         compliance with Section 5.17(g) of the Credit Agreement and (ii) any
         Securities Accounts (other than De Minimis Securities Accounts),
         Securities Entitlements (other than De Minimis Securities
         Entitlements), Concentration Accounts, Insurance Concentration Accounts
         or Collection Accounts that are created or acquired after the Closing
         Date, as of or prior to the deposit or transfer of any such Securities
         Entitlements or funds, whether constituting moneys or investments, into
         such Securities Accounts, Concentration Accounts, Government
         Receivables Concentration Accounts or Collection Accounts.

         In addition to the foregoing, if any issuer of any Investment Related
         Property is located in a jurisdiction outside of the United States,
         each Grantor shall take such additional actions as reasonably requested
         by the Joint Collateral Agent, including, without limitation, causing
         the issuer to register the pledge on its books and records or making
         such filings or recordings, in each case as may be necessary or
         advisable, under the laws of such issuer's jurisdiction to insure the
         validity, perfection and priority of the security interest of the Joint
         Collateral Agent. Upon the occurrence of and during the continuation of
         an Event of Default, the Joint Collateral Agent shall have the right,
         without notice to any Grantor, to transfer all or any portion of the
         Investment Related Property to its name or the name of its nominee or
         agent.

         4.5      MATERIAL CONTRACTS.

                  (a)      Covenants and Agreements. Each Grantor hereby
covenants and agrees from and after the date of this Agreement until the payment
in full of all Secured Obligations, the cancellation or termination of the
Commitments and the cancellation or expiration of all Outstanding Letters of
Credit that:

                                       24
<PAGE>

                           (i)      After the occurrence and during the
         continuance of an Event of Default, each Grantor shall deliver promptly
         to the Joint Collateral Agent a copy of each material demand, notice or
         document received by it relating in any way to any Material Contract;

                           (ii)     each Grantor shall deliver promptly to the
         Joint Collateral Agent, and in any event within ten (10) Business Days,
         after (1) any Material Contract of such Grantor is terminated or
         amended in a manner that is materially adverse to such Grantor or (2)
         any new Material Contract is entered into by such Grantor, a written
         statement describing such event, with copies of such material
         amendments or new contracts, delivered to the Joint Collateral Agent
         (to the extent such delivery is permitted by the terms of any such
         Material Contract, provided, no prohibition on delivery shall be
         effective if it were bargained for by such Grantor with the intent of
         avoiding compliance with this Section 4.5(b)(iii)), and an explanation
         of any actions being taken with respect thereto;

                           (iii)    it shall perform in all material respects
         all of its obligations with respect to the Material Contracts as it
         deems appropriate or advisable in the exercise of its business
         judgment;

                           (iv)     it shall promptly and diligently exercise
         each material right (except the right of termination) it may have under
         any Material Contract, any Supporting Obligation or Collateral Support
         to the extent such Grantor determines in the exercise of its business
         judgment that such enforcement is in its best interests, in each case,
         at its own expense, and in connection with such collections and
         exercise, such Grantor shall take such action as such Grantor or the
         Joint Collateral Agent may deem necessary or advisable;

                           (v)      it shall use its best efforts to keep in
         full force and effect any Supporting Obligation or Collateral Support
         relating to any Material Contract, in accordance with the terms of such
         Material Contract; and

                           (vi)     with respect to any Material Contract (other
         than any agreement, contract license to which any Governmental
         Authority is a counterparty) that prevents the assignment or granting
         of a security interest therein (either by its terms or by any federal
         or state statutory prohibition or otherwise) (any such agreement,
         contract or license, a "NON-ASSIGNABLE CONTRACT"), each Grantor shall,
         within thirty (30) days of the date hereof with respect to any
         Non-Assignable Contract in effect on the date hereof and within thirty
         (30) days after entering into any Non-Assignable Contract after the
         Closing Date, request in writing the consent of the counterparty or
         counterparties to the Non-Assignable Contract pursuant to the terms of
         such Non-Assignable Contract or applicable law to the assignment or
         granting of a security interest in such Non-Assignable Contract to the
         Joint Collateral Agent and use its commercially reasonable best efforts
         to obtain such consent as soon as practicable thereafter.

         4.6      LETTER OF CREDIT RIGHTS. (a) Representations and Warranties.
Each Grantor hereby represents and warrants to the Joint Collateral Agent and
each other Secured Party, on the Closing Date and on each Credit Date, that:

                                       25
<PAGE>

                           (i)      all material letters of credit to which such
         Grantor has rights is listed on Schedule 4.6 (as such schedule may be
         amended or supplemented from time to time) hereto; and

                           (ii)     it has obtained the consent of each issuer
         of any material letter of credit to the assignment of the proceeds of
         the letter of credit to the Joint Collateral Agent.

                  (b)      Covenants and Agreements. Each Grantor hereby
covenants and agrees with the Joint Collateral Agent and each other Secured
Party that from and after the date of this Agreement until the payment in full
of all Secured Obligations, the cancellation or termination of the Commitments
and the cancellation or expiration of all Outstanding Letters of Credit that
with respect to any material letter of credit hereafter arising it shall obtain
the consent of the issuer thereof to the assignment of the proceeds of the
letter of credit to the Joint Collateral Agent and shall deliver to the Joint
Collateral Agent a completed Pledge Supplement, substantially in the form of
Exhibit A attached hereto, together with all Supplements to Schedules necessary
to notify the Joint Collateral Agent of such additional material letter of
credit thereto.

         4.7      INTELLECTUAL PROPERTY.

                  (a)      Representations and Warranties. Except as disclosed
in Schedule 4.7(H) (as such schedule may be amended or supplemented from time to
time), each Grantor hereby represents and warrants to the Joint Collateral Agent
and each other Secured Party, on the Closing Date and on each Credit Date, that:

                           (i)      Schedule 4.7 (as such schedule may be
         amended or supplemented from time to time) sets forth a true and
         complete list of (i) all United States, state and foreign registrations
         of and applications for Patents, Trademarks and Copyrights owned by
         each Grantor and (ii) all Patent Licenses, Trademark Licenses and
         Copyright Licenses material to the business of Grantors, taken as a
         whole;

                           (ii)     it is the sole and exclusive owner of the
         entire right, title, and interest in and to all Intellectual Property
         set forth on Schedule 4.7 (as such schedule may be amended or
         supplemented from time to time) and owns or has the valid right to use
         all other Intellectual Property used in or necessary to conduct its
         business, free and clear of all Liens, except for Permitted Liens and
         the agreements set forth on Schedule 4.7(B), (D), (F) and (G) (as each
         may be amended or supplemented from time to time);

                           (iii)    all Intellectual Property material to the
         business of Grantors, taken as a whole, is subsisting and has not been
         adjudged invalid or unenforceable, in whole or in part, and each
         Grantor has performed all acts and has paid all renewal, maintenance,
         and other fees and taxes required to maintain each and every
         registration and application of Intellectual Property in full force and
         effect;

                           (iv)     all Intellectual Property material to the
         business of Grantors, taken as a whole, is valid and enforceable; no
         holding, decision, or judgment has been rendered in any action or
         proceeding before any court or administrative authority challenging the
         validity of, such Grantor's right to register, or such Grantor's rights
         to own or use, any Intellectual Property and no such action or
         proceeding is pending or, to the best of such Grantor's knowledge,
         threatened;

                                       26
<PAGE>

                           (v)      all registrations and applications for
         Copyrights, Patents and Trademarks are standing in the name of each
         Grantor, and none of the Trademarks, Patents, Copyrights or Trade
         Secret Collateral has been licensed by any Grantor to any affiliate or
         third party that is not a Grantor hereunder, except as disclosed in
         Schedule 4.7(B), (D), (F), or (G) (as each may be amended or
         supplemented from time to time);

                           (vi)     each Grantor has been using appropriate
         statutory notice of registration in connection with its use of
         registered Trademarks, proper marking practices in connection with the
         use of Patents, and appropriate notice of copyright in connection with
         the publication of Copyrights material to the business of Grantors,
         taken as a whole;

                           (vii)    each Grantor uses commercially reasonably
         efforts to provide adequate standards of quality in the manufacture,
         distribution, and sale of all products sold and in the provision of all
         services rendered under or in connection with all Trademark Collateral
         and has taken all commercially reasonable action necessary to insure
         that all licensees of the Trademark Collateral owned by such Grantor
         use such adequate standards of quality;

                           (viii)   to each Grantor's knowledge, the conduct of
         such Grantor's business does not infringe upon any trademark, patent,
         copyright, trade secret or similar intellectual property right owned or
         controlled by a third party; no claim has been made that the use of any
         Intellectual Property owned or used by Grantor (or any of its
         respective licensees) violates the asserted rights of any third party;

                           (ix)     to the best of each Grantor's knowledge, no
         third party is infringing upon any Intellectual Property owned or used
         by such Grantor, or any of its respective licensees;

                           (x)      no settlement or consents, covenants not to
         sue, nonassertion assurances, or releases have been entered into by
         Grantor or to which Grantor is bound that adversely affect Grantor's
         rights to own or use any Intellectual Property; and

                           (xi)     except with regard to Permitted Liens, each
         Grantor has not made a previous assignment, sale, transfer or agreement
         constituting a present or future assignment, sale, transfer or
         agreement of any Intellectual Property that has not been terminated or
         released. There is no effective financing statement or other document
         or instrument now executed, or on file or recorded in any public
         office, granting a security interest in or otherwise encumbering any
         part of the Intellectual Property, other than in favor of the Joint
         Collateral Agent.

                  (b)      Covenants and Agreements. Each Grantor hereby
covenants and agrees with the Joint Collateral Agent and each other Secured
Party that from and after the date of this Agreement until the payment in full
of all Secured Obligations, the cancellation or termination of the Commitments
and the cancellation or expiration of all Outstanding Letters of Credit that:

                           (i)      it shall not do any act or omit to do any
         act whereby any of the Intellectual Property which is material to the
         business of Grantors, taken as a whole, may lapse, or become abandoned,
         dedicated to the public, or unenforceable, or which would adversely
         affect the validity, grant, or enforceability of the security interest
         granted therein;

                                       27
<PAGE>

                           (ii)     it shall not, with respect to any Trademarks
         which are material to the business of Grantors, taken as a whole, cease
         the use of any of such Trademarks or fail to maintain the level of the
         quality of products sold and services rendered under any of such
         Trademark at a level at least substantially consistent with the quality
         of such products and services as of the date hereof, and each Grantor
         shall take all commercially reasonable steps necessary to insure that
         licensees of such Trademarks use such consistent standards of quality;

                           (iii)    it shall, within thirty (30) days of the
         creation or acquisition of any Copyrightable work which is material to
         the business of Grantor, apply to register the Copyright in the United
         States Copyright Office in accordance with such Grantor's past
         practice;

                           (iv)     it shall promptly notify the Joint
         Collateral Agent if it knows, has reason to know, or reasonably
         believes that any item of the Intellectual Property that is material to
         the business of any Grantor may become (a) abandoned or dedicated to
         the public or placed in the public domain, (b) invalid or
         unenforceable, or (c) subject to any adverse determination or
         development (including the institution of proceedings) in any action or
         proceeding in the United States Patent and Trademark Office, the United
         States Copyright Office, and state registry, any foreign counterpart of
         the foregoing, or any court;

                           (v)      it shall take all reasonable steps in the
         United States Patent and Trademark Office, the United States Copyright
         Office, any state registry or any foreign counterpart of the foregoing,
         to pursue any application and maintain any registration of each
         Trademark, Patent, and Copyright owned by any Grantor and material to
         the business of Grantors, taken as a whole, which is now or shall
         become included in the Intellectual Property (except for such works
         with respect to which such Grantor has determined in the exercise of
         its commercially reasonable judgment that it shall not seek
         registration) including, but not limited to, those items on Schedule
         47(A), (C) and (E) (as each may be amended or supplemented from time to
         time);

                           (vi)     in the event that any Intellectual Property
         owned by or exclusively licensed to any Grantor is infringed,
         misappropriated, or diluted by a third party, such Grantor shall
         promptly take all reasonable actions to stop such infringement,
         misappropriation, or dilution and protect its exclusive rights in such
         Intellectual Property including, but not limited to, the initiation of
         a suit for injunctive relief and to recover damages;

                           (vii)    it shall promptly (but in no event more than
         thirty (30) days after any Grantor obtains knowledge thereof) report to
         the Joint Collateral Agent (i) the filing of any application to
         register any Intellectual Property with the United States Patent and
         Trademark Office, the United States Copyright Office, or any state
         registry or foreign counterpart of the foregoing (whether such
         application is filed by such Grantor or through any agent, employee,
         licensee, or designee thereof) and (ii) the registration of any
         Intellectual Property by any such office, in each case by executing and
         delivering to the Joint Collateral Agent a completed Pledge Supplement,
         substantially in the form of Exhibit A attached hereto, together with
         all Supplements to Schedules thereto;

                           (viii)   it shall, promptly upon the reasonable
         request of the Joint Collateral Agent, execute and deliver to the Joint
         Collateral Agent any document required

                                       28
<PAGE>

         to acknowledge, confirm, register, record, or perfect the Joint
         Collateral Agent's interest in any part of the Intellectual Property,
         whether now owned or hereafter acquired;

                           (ix)     except with the prior consent of the Joint
         Collateral Agent or as permitted under the Credit Agreement or, at any
         time after the First Priority Termination Date, under the Rollover Note
         Indenture, each Grantor shall not execute, and there will not be on
         file in any public office, any financing statement or other document or
         instruments, except financing statements or other documents or
         instruments filed or to be filed in favor of the Joint Collateral Agent
         and each Grantor shall not sell, assign, transfer, license, grant any
         option, or create or suffer to exist any Lien upon or with respect to
         the Intellectual Property material to the business of Grantors, taken
         as a whole, except for Permitted Liens and the Lien created by and
         under this Security Agreement and the other Credit Documents;

                           (x)      it shall hereafter use commercially
         reasonable efforts so as not to permit the inclusion in any contract to
         which it hereafter becomes a party of any provision that could or might
         in any way materially impair or prevent the creation of a security
         interest in, or the assignment of, such Grantor's rights and interests
         in any property included within the definitions of any Intellectual
         Property that is material to the business of the Grantors, taken as a
         whole, acquired under such contracts;

                           (xi)     it shall take all steps reasonably necessary
         to protect the secrecy of all Trade Secrets that is material to the
         business of Grantors, taken as a whole, including, without limitation,
         restricting access to trade secret information and documents;

                           (xii)    it shall use proper statutory notice in
         connection with its use of any of the Intellectual Property; and

                           (xiii)   it shall continue to collect, at its own
         expense, all amounts due or to become due to such Grantor in respect of
         the Intellectual Property or any portion thereof. In connection with
         such collections, each Grantor may take (and during an Event of
         Default, at the Joint Collateral Agent's reasonable direction, shall
         take) such action as such Grantor or, during an Event of Default, the
         Joint Collateral Agent may deem reasonably necessary or advisable to
         enforce collection of such amounts. Notwithstanding the foregoing, the
         Joint Collateral Agent shall have the right at any time during an Event
         of Default, to notify, or require any Grantor to notify, any obligors
         with respect to any such amounts of the existence of the security
         interest created hereby.

         4.8      COMMERCIAL TORT CLAIMS

                  (a)      Representations and Warranties. Each Grantor hereby
represents and warrants to the Joint Collateral Agent and each other Secured
Party, on the Closing Date and on each Credit Date, that Schedule 4.8 (as such
schedule may be amended or supplemented from time to time) sets forth all
Commercial Tort Claims of each Grantor in excess of $100,000 individually or
$1,000,000 in the aggregate; and

                  (b)      Covenants and Agreements. Each Grantor hereby
covenants and agrees with the Joint Collateral Agent and each other Secured
Party that from and after the date of this Agreement until the payment in full
of all Secured Obligations, the cancellation or termination of the Commitments
and the cancellation or expiration of all Outstanding Letters of Credit that
with

                                       29
<PAGE>

respect to any Commercial Tort Claim in excess of $100,000 individually or
$1,000,000 in the aggregate hereafter arising it shall deliver to the Joint
Collateral Agent a completed Pledge Supplement, substantially in the form of
Exhibit A attached hereto, together with all Supplements to Schedules thereto,
identifying such new Commercial Tort Claims.

SECTION 5. ACCESS; RIGHT OF INSPECTION AND FURTHER ASSURANCES; ADDITIONAL
           GRANTORS.

         5.1      ACCESS; RIGHT OF INSPECTION. Each Grantor will, and will cause
each of its Subsidiaries to, permit any authorized representatives designated by
the Joint Collateral Agent to visit and inspect any of the properties of any
Grantor and any of its respective Subsidiaries, to inspect, copy and take
extracts from its and their financial and accounting records, and to discuss its
and their affairs, finances and accounts with its and their officers and
independent public accountants, all upon reasonable notice and at such
reasonable times during normal business hours and as often as may reasonably be
requested, provided that all visits to and inspections shall be conducted in a
manner calculated to minimize any disruption to the Grantors' operations and
consistent with the confidentiality provision set forth in Section 10.17 of the
Credit Agreement.

         5.2      FURTHER ASSURANCES. (a) Each Grantor agrees that from time to
time, at the expense of such Grantor, that it shall promptly execute and deliver
all further instruments and documents, and take all further action, that the
Joint Collateral Agent may reasonably request, in order to create and/or
maintain the validity, perfection or priority of and protect any security
interest granted or purported to be granted hereby or to enable the Joint
Collateral Agent to exercise and enforce its rights and remedies hereunder with
respect to any Collateral. Without limiting the generality of the foregoing,
each Grantor shall:

                           (i)      authorize the Joint Collateral Agent to file
         such financing or continuation statements, or amendments thereto, and
         execute and deliver such other agreements, instruments, endorsements,
         powers of attorney or notices, as may be necessary or desirable, or as
         the Joint Collateral Agent may reasonably request, in order to perfect
         and preserve the security interests granted or purported to be granted
         hereby;

                           (ii)     take all actions reasonably requested by
         Joint Collateral Agent as being necessary to ensure the recordation of
         appropriate evidence of the liens and security interest granted
         hereunder in the Intellectual Property with any intellectual property
         registry in which said Intellectual Property is registered or in which
         an application for registration is pending including, without
         limitation, the United States Patent and Trademark Office, the United
         States Copyright Office, the various Secretaries of State and the
         foreign counterparts on any of the foregoing;

                           (iii)    at any reasonable time, upon request by the
         Joint Collateral Agent, exhibit the Collateral to and allow inspection
         of the Collateral by the Joint Collateral Agent, or persons designated
         by the Joint Collateral Agent subject to the provisions of Section 5.1
         above; and

                           (iv)     at the Joint Collateral Agent's request,
         appear in and defend any action or proceeding that may affect such
         Grantor's title to or the Joint Collateral Agent's security interest in
         all or any part of the Collateral.

                  (b)      Each Grantor hereby authorizes the Joint Collateral
Agent to file a Record or Records, including, without limitation, financing or
continuation statements, and

                                       30
<PAGE>

amendments thereto, in any jurisdictions and with any filing offices as the
Joint Collateral Agent may determine, in its sole discretion, are necessary or
advisable to perfect the security interest granted to the Joint Collateral Agent
herein. 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 Joint Collateral Agent
may determine, in its sole discretion, is necessary, advisable or prudent to
ensure the perfection of the security interest in the Collateral granted to the
Joint Collateral Agent herein, including, without limitation, describing such
property as "all assets" or "all personal property, whether now owned or
hereafter acquired." Each Grantor shall furnish to the Joint Collateral Agent
from time to time statements and schedules further identifying and describing
the Collateral and such other reports in connection with the Collateral as the
Joint Collateral Agent may reasonably request, all in reasonable detail.

                  (c)      Each Grantor hereby authorizes the Joint Collateral
Agent to modify this Agreement after obtaining such Grantor's approval of or
signature to such modification by amending Schedule 4.7 (as such schedule may be
amended or supplemented from time to time) to include reference to any right,
title or interest in any existing Intellectual Property or any Intellectual
Property acquired or developed by any Grantor after the execution hereof or to
delete any reference to any right, title or interest in any Intellectual
Property in which any Grantor no longer has or claims any right, title or
interest.

         5.3      ADDITIONAL GRANTORS. From time to time subsequent to the date
hereof, additional Persons shall, in accordance with the Credit Agreement or the
Rollover Note Indenture, become parties hereto as additional Grantors (each, an
"Additional Grantor"), by executing a Counterpart Agreement. Upon delivery of
any such Counterpart Agreement to the Joint Collateral Agent, notice of which is
hereby waived by Grantors, each Additional Grantor shall be a Grantor. Each
Grantor expressly agrees that its obligations arising hereunder shall not be
affected or diminished by the addition or release of any other Grantor
hereunder, nor by any election of Joint Collateral Agent not to cause any
Subsidiary of Company to become an Additional Grantor hereunder. This Agreement
shall be fully effective as to any Grantor that is or becomes a party hereto
regardless of whether any other Person becomes or fails to become or ceases to
be a Grantor hereunder.

SECTION 6. JOINT COLLATERAL AGENT APPOINTED ATTORNEY-IN-FACT.

         6.1      POWER OF ATTORNEY. Each Grantor hereby irrevocably appoints
the Joint Collateral Agent as such Grantor's attorney-in-fact, with full
authority in the place and stead of such Grantor and in the name of such
Grantor, the Joint Collateral Agent or otherwise, from time to time in the Joint
Collateral Agent's discretion to take any action and to execute any instrument
that the Joint Collateral Agent may deem reasonably necessary or advisable to
accomplish the purposes of this Agreement, including, without limitation, the
following:

                  (a)      upon the occurrence and during the continuance of any
Event of Default, in consultation with the applicable Grantor(s) in order to
ensure the validity, perfection and priority of the Joint Collateral Agent and
any other rights of the Joint Collateral Agent over the Collateral to obtain and
adjust insurance relating to the Collateral required to be maintained by such
Grantor or paid to the Joint Collateral Agent pursuant to the Credit Agreement,
and not so maintained or paid;

                                       31
<PAGE>

                  (b)      upon the occurrence and during the continuance of any
Event of Default, to ask for, demand, collect, sue for, recover, compound,
receive and give acquittance and receipts for moneys due and to become due under
or in respect of any of the Collateral;

                  (c)      upon the occurrence and during the continuance of any
Event of Default, to receive, endorse and collect any drafts or other
instruments, documents and chattel paper in connection with clause (b) above;

                  (d)      upon the occurrence and during the continuance of any
Event of Default, to file any claims or take any action or institute any
proceedings that the Joint Collateral Agent may deem necessary or desirable for
the collection of any of the Collateral or otherwise to enforce the rights of
the Joint Collateral Agent with respect to any of the Collateral;

                  (e)      to prepare and file any UCC financing statements
relating to the Collateral against such Grantor as debtor;

                  (f)      to prepare, sign, and file for recordation in any
intellectual property registry, appropriate evidence of the lien and security
interest granted herein in the Intellectual Property in the name of such Grantor
as assignor;

                  (g)      to take or cause to be taken all actions necessary to
perform or comply or cause performance or compliance with the terms of this
Agreement, including, without limitation, access to pay or discharge taxes or
Liens (other than Permitted Liens) levied or placed upon or threatened against
the Collateral, the legality or validity thereof and the amounts necessary to
discharge the same to be determined by the Joint Collateral Agent in its sole
discretion, any such payments made by the Joint Collateral Agent to become
obligations of such Grantor to the Joint Collateral Agent, due and payable
immediately without demand; and

                  (h)      subject to any Requirement of Law, generally to sell,
transfer, pledge, make any agreement with respect to or otherwise deal with any
of the Collateral as fully and completely as though the Joint Collateral Agent
were the absolute owner thereof for all purposes, and to do, at the Joint
Collateral Agent's option and such Grantor's expense, at any time or from time
to time, upon three (3) Business Days notice to such Grantor, all acts and
things that the Joint Collateral Agent deems reasonably necessary to protect,
preserve or realize upon the Collateral and the Joint Collateral Agent's
security interest therein in order to effect the intent of this Agreement, all
as fully and effectively as such Grantor might do.

         6.2      NO DUTY ON THE PART OF JOINT COLLATERAL AGENT OR SECURED
PARTIES. The powers conferred on the Joint Collateral Agent hereunder are solely
to protect the interests of the Secured Parties in the Collateral and shall not
impose any duty upon the Joint Collateral Agent or any Secured Party to exercise
any such powers. The Joint Collateral Agent and the Secured Parties shall be
accountable only for amounts that they actually receive as a result of the
exercise of such powers, and neither they nor any of their officers, directors,
employees or agents shall be responsible to any Grantor for any act or failure
to act hereunder, except for their own gross negligence or willful misconduct.

         RATIFICATION. Each Grantor hereby ratifies all that said attorneys
shall lawfully do or cause to be done by virtue hereof. All powers,
authorizations and agencies contained in this Agreement are coupled with an
interest and are irrevocable until this Agreement is terminated and the security
interest created hereby are released.

SECTION 7. REMEDIES.

                                       32
<PAGE>

         7.1      GENERALLY.

                  (a)      If any Event of Default shall have occurred and be
continuing, the Joint Collateral Agent may, subject to the terms of and in the
manner contemplated by the Intercreditor Agreement, exercise in respect of the
Collateral, in addition to all other rights and remedies provided for herein or
otherwise available to it at law or in equity, all the rights and remedies of a
secured party on default under the UCC (whether or not the UCC applies to the
affected Collateral) to collect, enforce or satisfy any Secured Obligations then
owing, whether by acceleration or otherwise, and also may pursue any of the
following separately, successively or simultaneously:

                           (i)      require any Grantor to, and each Grantor
         hereby agrees that it shall at its expense and promptly upon request of
         the Joint Collateral Agent forthwith, assemble all or part of the
         Collateral as directed by the Joint Collateral Agent and make it
         available to the Joint Collateral Agent at a place to be designated by
         the Joint Collateral Agent that is reasonably convenient to both
         parties;

                           (ii)     enter onto the property where any Collateral
         is located and take possession thereof with or without judicial
         process, subject to any Requirement of Law;

                           (iii)    prior to the disposition of the Collateral,
         store, process, repair or recondition the Collateral or otherwise
         prepare the Collateral for disposition in any manner to the extent the
         Joint Collateral Agent deems appropriate; and

                           (iv)     without notice except as specified below or
         under the UCC, sell, assign, lease, license (on an exclusive or
         nonexclusive basis) or otherwise dispose of the Collateral or any part
         thereof in one or more parcels at public or private sale, at any of the
         Joint Collateral Agent's offices or elsewhere, for cash, on credit or
         for future delivery, at such time or times and at such price or prices
         and upon such other terms as the Joint Collateral Agent may deem
         commercially reasonable.

                  (b)      The Joint Collateral Agent or any Secured Party may
be the purchaser of any or all of the Collateral at any public or private (to
the extent any portion of the Collateral being privately sold is of a kind that
is customarily sold on a recognized market or the subject of widely distributed
standard price quotations) sale in accordance with the UCC and the Joint
Collateral Agent, as agent for and representative of the Secured Parties, shall
be entitled, at the direction of the Directing Party, for the purpose of bidding
and making settlement or payment of the purchase price for all or any portion of
the Collateral sold at any such sale made in accordance with the UCC, to use and
apply any of the Secured Obligations owing solely to the Secured Parties or
Secured Party for whom such Directing Party is acting at such time as a credit
on account of the purchase price for any Collateral payable by the Joint
Collateral Agent at such sale. Each purchaser at any such sale shall hold the
property sold absolutely free from any claim or right on the part of any
Grantor, and each Grantor hereby waives (to the extent permitted by applicable
law) all rights of redemption, stay and/or appraisal which it now has or may at
any time in the future have under any rule of law or statute now existing or
hereafter enacted. Each Grantor agrees that, to the extent notice of sale shall
be required by law, at least ten (10) days notice to such Grantor of the time
and place of any public sale or the time after which any private sale is to be
made shall constitute reasonable notification. The Joint Collateral Agent shall
not be obligated to make any sale of Collateral regardless of notice of sale
having been given. The Joint Collateral Agent may adjourn any public or private
sale from time to time by announcement at the time and place fixed therefor, and
such sale may, without further notice, be made at the time

                                       33
<PAGE>

and place to which it was so adjourned. Each Grantor agrees that it would not be
commercially unreasonable for the Joint Collateral Agent to dispose of the
Collateral or any portion thereof by using Internet sites that provide for the
auction of assets of the types included in the Collateral or that have the
reasonable capability of doing so, or that match buyers and sellers of assets.
Each Grantor hereby waives any claims against the Joint Collateral Agent arising
by reason of the fact that the price at which any Collateral may have been sold
at such a private sale was less than the price which might have been obtained at
a public sale, even if the Joint Collateral Agent accepts the first offer
received and does not offer such Collateral to more than one offeree. If the
proceeds of any sale or other disposition of the Collateral are insufficient to
pay all the Secured Obligations, Grantors shall be liable for the deficiency and
the reasonable and documented fees of any attorneys employed by the Joint
Collateral Agent to collect such deficiency. Each Grantor further agrees that a
breach of any of the covenants contained in this Section will cause irreparable
injury to the Joint Collateral Agent, that the Joint Collateral Agent has no
adequate remedy at law in respect of such breach and, as a consequence, that
each and every covenant contained in this Section shall be specifically
enforceable against such Grantor, and such Grantor hereby waives and agrees not
to assert any defenses against an action for specific performance of such
covenants except for a defense that no default has occurred giving rise to the
Secured Obligations becoming due and payable prior to their stated maturities.
Nothing in this Section shall in any way alter the rights of the Joint
Collateral Agent hereunder.

                  (c)      The Joint Collateral Agent may sell the Collateral
without giving any warranties as to the Collateral. The Joint Collateral Agent
may specifically disclaim or modify any warranties of title or the like. This
procedure will not be considered to adversely effect the commercial
reasonableness of any sale of the Collateral.

                  (d)      If the Joint Collateral Agent sells any of the
Collateral on credit, the Secured Obligations will be credited only with
payments actually made by the purchaser and received by the Joint Collateral
Agent and applied to the indebtedness of the purchaser. In the event the
purchaser fails to pay for the Collateral, the Joint Collateral Agent may resell
the Collateral.

                  (e)      The Joint Collateral Agent shall have no obligation
to marshal any of the Collateral.

         7.2      APPLICATION OF PROCEEDS. Except as expressly provided
elsewhere in this Agreement, all proceeds received by the Joint Collateral Agent
in respect of any sale, any collection from, or other realization upon all or
any part of the Collateral shall be applied in full or in part by the Joint
Collateral Agent against, the Secured Obligations in the order of priority set
forth in the Intercreditor Agreement.

         7.3      INVESTMENT RELATED PROPERTY.

                  (a)      Each Grantor recognizes that, by reason of certain
prohibitions contained in the Securities Act and applicable state securities
laws, the Joint Collateral Agent may be compelled, with respect to any sale of
all or any part of the Investment Related Property conducted without prior
registration or qualification of such Investment Related Property under the
Securities Act and/or such state securities laws, to limit purchasers to those
who will agree, among other things, to acquire the Investment Related Property
for their own account, for investment and not with a view to the distribution or
resale thereof. Each Grantor acknowledges that any such private sale may be at
prices and on terms less favorable than those obtainable through a public sale
without such restrictions (including a public offering made pursuant to a

                                       34
<PAGE>

registration statement under the Securities Act) and, notwithstanding such
circumstances, each Grantor agrees that any such private sale shall be deemed to
have been made in a commercially reasonable manner and that the Joint Collateral
Agent shall have no obligation to engage in public sales and no obligation to
delay the sale of any Investment Related Property for the period of time
necessary to permit the issuer thereof to register it for a form of public sale
requiring registration under the Securities Act or under applicable state
securities laws, even if such issuer would, or should, agree to so register it.
If the Joint Collateral Agent determines to exercise its right to sell any or
all of the Investment Related Property, upon written request, each Grantor shall
and shall cause each issuer of any Pledged Stock to be sold hereunder, each
partnership and each limited liability company from time to time to furnish to
the Joint Collateral Agent all such information as the Joint Collateral Agent
may request in order to determine the number and nature of interest, shares or
other instruments included in the Investment Related Property which may be sold
by the Joint Collateral Agent in exempt transactions under the Securities Act
and the rules and regulations of the Securities and Exchange Commission
thereunder, as the same are from time to time in effect.

                  (b)      Upon the occurrence and during the continuation of an
Event of Default, the Joint Collateral Agent shall have the right to apply the
balance from any Deposit Account or instruct the bank at which any Deposit
Account is maintained to pay the balance of any Deposit Account to or for the
benefit of the Joint Collateral Agent.

         7.4      INTELLECTUAL PROPERTY.

                  (a)      Anything contained herein to the contrary
notwithstanding, except as otherwise set forth in Section 2.2, upon the
occurrence and during the continuation of an Event of Default:

                           (i)      the Joint Collateral Agent shall have the
         right (but not the obligation) to bring suit or otherwise commence any
         action or proceeding in the name of any Grantor, the Joint Collateral
         Agent or otherwise, in the Joint Collateral Agent's sole discretion, to
         enforce any Intellectual Property, in which event such Grantor shall,
         at the request of the Joint Collateral Agent, do any and all lawful
         acts and execute any and all documents required by the Joint Collateral
         Agent in aid of such enforcement and such Grantor shall promptly, upon
         demand, reimburse and indemnify the Joint Collateral Agent as provided
         in Section 10 hereof in connection with the exercise of its rights
         under this Section, and, to the extent that the Joint Collateral Agent
         shall elect not to bring suit to enforce any Intellectual Property as
         provided in this Section, each Grantor agrees to use all reasonable
         measures, whether by action, suit, proceeding or otherwise, to prevent
         the infringement of any of the Intellectual Property by others and for
         that purpose agrees to diligently maintain any action, suit or
         proceeding against any Person so infringing as shall be reasonably
         necessary to prevent such infringement;

                           (ii)     if the Secured Obligations shall have become
         immediately due and payable, upon written demand from the Joint
         Collateral Agent, each Grantor shall grant, assign, convey or otherwise
         transfer to the Joint Collateral Agent an absolute assignment of all of
         such Grantor's right, title and interest in and to the Intellectual
         Property and shall execute and deliver to the Joint Collateral Agent
         such documents as are necessary or appropriate to carry out the intent
         and purposes of this Agreement subject to the limitation set forth in
         Section 2.2 herein;

                                       35
<PAGE>

                           (iii)    each Grantor agrees that such an assignment
         and/or recording shall be applied to reduce the Secured Obligations
         outstanding only to the extent that the Joint Collateral Agent (or any
         Secured Party) receives cash proceeds in respect of the sale of, or
         other realization upon, the Intellectual Property; and

                           (iv)     the Joint Collateral Agent shall have the
         right to notify, or require each Grantor to notify, any obligors with
         respect to amounts due or to become due to such Grantor in respect of
         the Intellectual Property, of the existence of the security interest
         created herein, to direct such obligors to make payment of all such
         amounts directly to the Joint Collateral Agent, and, upon such
         notification and at the expense of such Grantor, to enforce collection
         of any such amounts and to adjust, settle or compromise the amount or
         payment thereof, in the same manner and to the same extent as such
         Grantor might have done;

         (1)      all amounts and proceeds (including checks and other
                  instruments) received by Grantor in respect of amounts due to
                  such Grantor in respect of the Collateral or any portion
                  thereof shall be received in trust for the benefit of the
                  Joint Collateral Agent hereunder, shall be segregated from
                  other funds of such Grantor and shall be forthwith paid over
                  or delivered to the Joint Collateral Agent in the same form as
                  so received (with any necessary endorsement) to be held as
                  cash Collateral and applied as provided by Section 7.7 hereof;
                  and

         (2)      Grantor shall not adjust, settle or compromise the amount or
                  payment of any such amount or release wholly or partly any
                  obligor with respect thereto or allow any credit or discount
                  thereon without the prior written consent of the Joint
                  Collateral Agent, which consent shall not be unreasonably
                  withheld.

                  (b)      If (i) an Event of Default shall have occurred and,
by reason of cure, waiver, modification, amendment or otherwise, no longer be
continuing, (ii) no other Event of Default shall have occurred and be
continuing, (iii) an assignment or other transfer to the Joint Collateral Agent
of any rights, title and interests in and to the Intellectual Property shall
have been previously made and shall have become absolute and effective, and (iv)
the Secured Obligations shall not have become immediately due and payable or the
acceleration of any Secured Obligations shall have been duly rescinded, then,
upon the written request of any Grantor, the Joint Collateral Agent shall
promptly execute and deliver to such Grantor, at such Grantor's sole cost and
expense, such assignments or other transfer as may be necessary to reassign to
such Grantor any such rights, title and interests as may have been assigned to
the Joint Collateral Agent as aforesaid, subject to any disposition thereof that
may have been made by the Joint Collateral Agent; provided, after giving effect
to such reassignment, the Joint Collateral Agent's security interest granted
pursuant hereto, as well as all other rights and remedies of the Joint
Collateral Agent granted hereunder, shall continue to be in full force and
effect; and provided further, the rights, title and interests so reassigned
shall be free and clear of any Liens granted by or on behalf of the Joint
Collateral Agent and the Secured Parties.

                  (c)      Solely for the purpose of enabling the Joint
Collateral Agent to exercise rights and remedies under this Section 7 and at
such time as the Joint Collateral Agent shall be lawfully entitled to exercise
such rights and remedies, each Grantor hereby grants to the Joint Collateral
Agent, to the extent it has the right to do so, an irrevocable, nonexclusive
license (exercisable without payment of royalty or other compensation to such
Grantor), subject, in the case of Trademarks, to sufficient rights to quality
control and inspection in favor of such Grantor to avoid the risk of
invalidation of said Trademarks, to use, operate under, license, or sublicense

                                       36
<PAGE>

any Intellectual Property now owned or hereafter acquired by such Grantor, and
wherever the same may be located.

         7.5      CASH PROCEEDS. In addition to the rights of the Joint
Collateral Agent specified in Section 4.3 with respect to payments of
Receivables, all proceeds of any Collateral received by any Grantor consisting
of cash, checks and other near-cash items (collectively, "CASH PROCEEDS") shall
be held by such Grantor in trust for the Joint Collateral Agent, segregated from
other funds of such Grantor, and shall, forthwith upon receipt by such Grantor,
unless otherwise provided pursuant to Section 4.4(a)(ii) above or Section
2.14(a) of the Credit Agreement, be turned over to the Joint Collateral Agent in
the exact form received by such Grantor (duly indorsed by such Grantor to the
Joint Collateral Agent, if required) and held by the Joint Collateral Agent in
the Collection Account. Any Cash Proceeds received by the Joint Collateral Agent
(whether from a Grantor or otherwise): (i) if no Event of Default shall have
occurred and be continuing, shall be held by the Joint Collateral Agent for the
ratable benefit of the Secured Parties, as collateral security for the Secured
Obligations (whether matured or unmatured) and (ii) if an Event of Default shall
have occurred and be continuing, may, in the sole discretion of the Joint
Collateral Agent, (A) be held by the Joint Collateral Agent for the ratable
benefit of the Secured Parties, as collateral security for the Secured
Obligations (whether matured or unmatured) and/or (B) then or at any time
thereafter may be applied by the Joint Collateral Agent against the Secured
Obligations then due and owing.

SECTION 8. JOINT COLLATERAL AGENT.

         The Joint Collateral Agent has been appointed to act as Joint
Collateral Agent hereunder (i) by the Administrative Agent pursuant to the
Intercreditor Agreement, (ii) the Rollover Note Trustee pursuant to the
Intercreditor Agreement and (iii) by their acceptance of the benefits hereof, by
the other Secured Parties. The Joint Collateral Agent shall be obligated, and
shall have the right hereunder, to make demands, to give notices, to exercise or
refrain from exercising any rights, to grant or refuses to grant any consent and
to take or refrain from taking any action (including, without limitation, the
release or substitution of Collateral), solely in accordance with the provisions
of the Intercreditor Agreement. In furtherance of the foregoing provisions of
the Intercreditor Agreement, each Secured Party, by its acceptance of the
benefits hereof, agrees that it shall have no right individually to realize upon
any of the Collateral hereunder, it being understood and agreed by such Secured
Party that all rights and remedies hereunder may be exercised solely by the
Joint Collateral Agent for the benefit of all Secured Parties in accordance with
the terms of this Section. The Joint Collateral Agent may resign or be removed
and a successor Joint Collateral Agent may be appointed, all in accordance with
Section 19 of the Intercreditor Agreement.

SECTION 9. CONTINUING SECURITY INTEREST; TRANSFER OF LOANS.

         This Agreement shall create a continuing security interest in the
Collateral and shall remain in full force and effect until the payment in full
of all Secured Obligations, the cancellation or termination of the Commitments
and the cancellation or expiration of all Outstanding Letters of Credit, be
binding upon each Grantor, its successors and assigns, and inure, together with
the rights and remedies of the Joint Collateral Agent hereunder, to the benefit
of the Joint Collateral Agent and its successors, transferees and assigns, for
the benefit and on behalf of the Secured Parties. Without limiting the
generality of the foregoing, any Secured Party may assign or otherwise transfer
any Secured Obligations held by it to any other Person subject to and in
compliance with the terms of the Credit Agreement or the Rollover Note
Indenture, as applicable, and such other Person shall thereupon become vested
with all the benefits in respect

                                       37
<PAGE>

thereof granted to the Secured Parties herein or otherwise. Upon the payment in
full of all Secured Obligations, the cancellation or termination of the
Commitments and the cancellation or expiration of all Outstanding Letters of
Credit, the security interest and Liens granted hereby shall terminate hereunder
and of record and all rights to the Collateral shall revert to Grantors. Upon
any such termination the Joint Collateral Agent shall, at Grantors' expense,
execute and deliver to Grantors such documents as Grantors shall reasonably
request to evidence such termination.

SECTION 10. STANDARD OF CARE; JOINT COLLATERAL AGENT MAY PERFORM.

         The powers conferred on the Joint Collateral Agent hereunder are solely
to protect its interest, for the benefit and on behalf of the Secured Parties,
in the Collateral and shall not impose any duty upon it to exercise any such
powers. Except for the exercise of reasonable care in the custody of any
Collateral in its possession and the accounting for moneys actually received by
it hereunder, the Joint Collateral Agent shall have no duty as to any Collateral
or as to the taking of any necessary steps to preserve rights against prior
parties or any other rights pertaining to any Collateral. The Joint Collateral
Agent shall be deemed to have exercised reasonable care in the custody and
preservation of Collateral in its possession if such Collateral is accorded
treatment substantially equal to that which the Joint Collateral Agent accords
its own property. Neither the Joint Collateral Agent nor any of its directors,
officers, employees or agents shall be liable for failure to demand, collect or
realize upon all or any part of the Collateral or for any delay in doing so or
shall be under any obligation to sell or otherwise dispose of any Collateral
upon the request of any Grantor or otherwise. If any Grantor fails to perform
any agreement contained herein, the Joint Collateral Agent may itself perform,
or cause performance of, such agreement, and the expenses of the Joint
Collateral Agent incurred in connection therewith shall be payable by each
Grantor under Section 10.2 of the Credit Agreement and Section 15 of the
Intercreditor Agreement.

SECTION 11. MISCELLANEOUS. NOTICE, ASSIGNMENT, ETC.Any notice required or
permitted to be given under this Agreement shall be given in accordance with
Section 10.1 of the Credit Agreement and Section 12.2 of the Rollover Note
Indenture, as applicable. No failure or delay on the part of the Joint
Collateral Agent in the exercise of any power, right or privilege hereunder or
under any other Transaction Document shall impair such power, right or privilege
or be construed to be a waiver of any default or acquiescence therein, nor shall
any single or partial exercise of any such power, right or privilege preclude
other or further exercise thereof or of any other power, right or privilege. All
rights and remedies existing under this Agreement and the other Transaction
Documents are cumulative to, and not exclusive of, any rights or remedies
otherwise available. In case any provision in or obligation under this Agreement
shall be invalid, illegal or unenforceable in any jurisdiction, the validity,
legality and enforceability of the remaining provisions or obligations, or of
such provision or obligation in any other jurisdiction, shall not in any way be
affected or impaired thereby. All covenants hereunder shall be given independent
effect so that if a particular action or condition is not permitted by any of
such covenants, the fact that it would be permitted by an exception to, or would
otherwise be within the limitations of, another covenant shall not avoid the
occurrence of a Default or an Event of Default (as each term is defined in the
Credit Agreement or the Rollover Note Indenture) if such action is taken or
condition exists. This Agreement shall be binding upon and inure to the benefit
of the Joint Collateral Agent and Grantors and their respective successors and
assigns. No Grantor shall assign any right, duty or obligation hereunder except
as otherwise permitted under and in accordance with the Credit Agreement or the
Rollover Note Indenture, and any such assignment shall be null and void. This
Agreement and the other Transaction Documents embody the entire agreement and
understanding between Grantors and the Joint Collateral Agent and supersede all

                                       38
<PAGE>

prior agreements and understandings between such parties relating to the subject
matter hereof and thereof. Accordingly, the Transaction Documents may not be
contradicted by evidence of prior, contemporaneous or subsequent oral agreements
of the parties. There are no unwritten oral agreements between the parties. This
Agreement may be executed in one or more counterparts and by different parties
hereto in separate counterparts, each of which when so executed and delivered
shall be deemed an original, but all such counterparts together shall constitute
but one and the same instrument; signature pages may be detached from multiple
separate counterparts and attached to a single counterpart so that all signature
pages are physically attached to the same document.

         11.2     EFFECT OF TERMINATION OF CREDIT DOCUMENTS OR THE ROLLOVER NOTE
                  INDENTURE.

                  (a)      Upon the payment in full of the First Priority
Obligations, the cancellation or termination of the Commitments and the
cancellation or expiration of all Outstanding Letters of Credit, and upon
receipt by the Joint Collateral Agent of notice of the same (which notice shall
be sent by the Administrative Agent in accordance with Section 25 of the
Intercreditor Agreement), the term "Secured Parties" used herein shall be deemed
to mean the Second Priority Secured Parties only; the term "Transaction
Documents" shall be deemed to refer only to the Intercreditor Agreement, the
Collateral Documents (as defined in the Credit Agreement) and the Senior Note
Documents; the term "Secured Obligations" shall be deemed to mean all Secured
Obligations other than the First Priority Obligations; and all references herein
to the Administrative Agent shall be deemed ineffective and of no further force
and effect.

                  (b)      Upon the payment in full of the Second Priority
Obligations and the discharge of the Rollover Note Indenture, and upon receipt
by the Joint Collateral Agent of notice of the same (which notice shall be sent
by the Rollover Note Trustee in accordance with Section 25 of the Intercreditor
Agreement), the term "Secured Parties" used herein shall be deemed to mean the
First Priority Secured Parties only; the term "Transaction Documents" shall be
deemed to refer only to the Intercreditor Agreement and the Credit Documents;
the term "Secured Obligations" shall be deemed to mean only all Secured
Obligations other than the Second Priority Obligations; and all references
herein to the Rollover Notes, the Rollover Note Indenture and the Rollover Note
Trustee shall be deemed ineffective and of no further force and effect.

                  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO ITS
CONFLICTS OF LAW PROVISIONS (OTHER THAN SECTION 2708 OF TITLE 6 OF THE DELAWARE
CODE).

                                       39
<PAGE>

                  IN WITNESS WHEREOF, each Grantor and the Joint Collateral
Agent have caused this Agreement to be duly executed and delivered by their
respective officers thereunto duly authorized as of the date first written
above.

GRANTORS:                      MARINER HEALTH CARE, INC.

                               By: /s/  Boyd P. Gentry
                                   ---------------------------------------------
                                        Name:  Boyd P. Gentry
                                        Title: Sr. Vice President and Treasurer

                               EACH OTHER GRANTOR LISTED ON SCHEDULE A HERETO

                               By: /s/  Brian Grazzini
                                   ---------------------------------------------
                                        Name:  Brian Grazzini
                                        Title: Vice President

                                       40
<PAGE>

JOINT COLLATERAL AGENT:                 RESIDENTIAL FUNDING
                                        CORPORATION DBA GMAC-RFC
                                        HEALTH CAPITAL,
                                        as the Joint Collateral Agent

                                        By: /s/ Lorna Gleason
                                            ------------------------------------
                                                Name:  Lorna Gleason
                                                Title: Managing Director

                                       41
<PAGE>

                                                                      SCHEDULE A

                                LIST OF GRANTORS
<PAGE>
                                                                   SCHEDULE 1.1

                         EXCLUDED SUBSIDIARY INTERESTS

Name of Entity

                                SCHEDULE 4.1-1
<PAGE>

                                                                   SCHEDULE 4.1
                                               TO PLEDGE AND SECURITY AGREEMENT

                              GENERAL INFORMATION

(A)      Full Legal Name, Type of Organization, Jurisdiction of Organization,
         Chief Executive Office/Sole Place of Business (or Residence if Grantor
         is a Natural Person) and Organizational Identification Number of each
         Grantor:

<TABLE>
<CAPTION>
                                                                Chief Executive
                                                                Office/Sole Place of
                                                                Business (or Residence
                      Type of              Jurisdiction of      if Grantor is a Natural
Full Legal Name       Organization         Organization         Person)                    Organization I.D.#
---------------       ------------         ---------------      -----------------------    ------------------
<S>                   <C>                  <C>                  <C>                        <C>

</TABLE>

(B)      Other Names (including any Trade-Name or Fictitious Business Name)
         under which each Grantor has conducted business for the past five (5)
         years:

<TABLE>
<CAPTION>
Name of Grantor                              Description of Agreement
---------------                              ------------------------
<S>                                          <C>

</TABLE>

(C)      Changes in Name, Jurisdiction of Organization, Chief Executive Office
         or Sole Place of Business (or Principal Residence if Grantor is a
         Natural Person) and Corporate Structure within past five (5) years:

<TABLE>
<CAPTION>
Full Legal Name                     Trade Name or Fictitious Business Name
---------------                     --------------------------------------
<S>                                 <C>

</TABLE>

(D)      Agreements pursuant to which any Grantor is found as debtor within
         past five (5) years:

<TABLE>
<CAPTION>
Name of Grantor                     Date of Change                      Description of Change
---------------                     --------------                      ---------------------
<S>                                 <C>                                 <C>

</TABLE>

(E)      Initial Financing Statements:

<TABLE>
<CAPTION>
Name of Grantor                              Filing Jurisdiction(s)
---------------                              ----------------------
<S>                                          <C>

</TABLE>

                                SCHEDULE 4.1-1
<PAGE>

(F)      Consents:

(G)      Existing Financing Statements:

                                SCHEDULE 4.7-2
<PAGE>

                                                                   SCHEDULE 4.2
                                               TO PLEDGE AND SECURITY AGREEMENT

<TABLE>
<CAPTION>
Name of Grantor                     Location of Equipment and Inventory
---------------                     -----------------------------------
<S>                                 <C>

</TABLE>

                                SCHEDULE 4.2-1
<PAGE>

                                                                   SCHEDULE 4.4
                                               TO PLEDGE AND SECURITY AGREEMENT

                          INVESTMENT RELATED PROPERTY

(A)(1)   Pledged Stock:

<TABLE>
<CAPTION>
                                                         STOCK                      NO. OF       % OF OUTSTANDING
                STOCK      CLASS OF     CERTIFICATED     CERTIFICATE     PAR        PLEDGED      STOCK OF THE
GRANTOR         ISSUER     STOCK        (Y/N)            NO.             VALUE      STOCK        STOCK ISSUER
-------         ------     --------     ------------     -----------     -----      -------      ----------------
<S>             <C>        <C>          <C>              <C>             <C>        <C>          <C>

</TABLE>

(2)      Pledged LLC Interests:

<TABLE>
<CAPTION>
                                                                                           % OF OUTSTANDING
                                                                                           LLC INTERESTS OF
            LIMITED LIABILITY                         CERTIFICATE NO.    NO. OF PLEDGED       THE LIMITED
GRANTOR          COMPANY        CERTIFICATED (Y/N)       (IF ANY)             UNITS        LIABILITY COMPANY
-------     -----------------   ------------------    ---------------    --------------    -----------------
<S>         <C>                 <C>                   <C>                <C>               <C>

</TABLE>

(3)      Pledged Partnership Interests:

<TABLE>
<CAPTION>
                                 TYPE OF
                                 PARTNERSHIP                                                        % OF OUTSTANDING
                                 INTERESTS (E.G.,                                                   PARTNERSHIP
                                 GENERAL OR                                  CERTIFICATE NO.        INTERESTS OF THE
GRANTOR       PARTNERSHIP        LIMITED)            CERTIFICATED (Y/N)      (IF ANY)               PARTNERSHIP
-------       -----------        ----------------    ------------------      ---------------        ----------------
<S>           <C>                <C>                 <C>                     <C>                    <C>

</TABLE>

(4)      Pledged Trust Interests:

<TABLE>
<CAPTION>
                               CLASS OF
                                 TRUST                            CERTIFICATE NO.      % OF OUTSTANDING TRUST
GRANTOR         TRUST          INTERESTS    CERTIFICATED (Y/N)        (IF ANY)         INTERESTS OF THE TRUST
-------         -----          ---------    ------------------    ---------------      ----------------------
<S>             <C>            <C>          <C>                   <C>                  <C>

</TABLE>

                                 EXHIBIT 4.4-1
<PAGE>
(5)      Pledged Debt:

<TABLE>
<CAPTION>
                                   ORIGINAL PRINCIPAL           OUTSTANDING
GRANTOR         ISSUER             AMOUNT                       PRINCIPAL BALANCE         ISSUE DATE          MATURITY DATE
-------         ------             ------------------           -----------------         ----------          -------------
<S>             <C>                <C>                          <C>                       <C>                 <C>

</TABLE>

(6)      Securities Account:

<TABLE>
<CAPTION>
                 SHARE OF SECURITIES
GRANTOR          INTERMEDIARY                    ACCOUNT NUMBER                  ACCOUNT NAME
-------          -------------------             --------------                  ------------
<S>              <C>                             <C>                             <C>

</TABLE>

(7)      Commodities Accounts:

<TABLE>
<CAPTION>
                 NAME OF COMMODITIES
GRANTOR          INTERMEDIARY                   ACCOUNT NUMBER                  ACCOUNT NAME
-------          -------------------            --------------                  ------------
<S>              <C>                            <C>                             <C>

</TABLE>

(8)      (a)      Deposit Accounts: Concentration Account

<TABLE>
<CAPTION>
               NAME OF DEPOSITARY
GRANTOR        BANK                           ACCOUNT NUMBER                   ACCOUNT NAME
-------        ------------------             --------------                   ------------
<S>            <C>                            <C>                              <C>

</TABLE>

         (b)      Deposit Accounts:  Insurance Concentration Account

<TABLE>
<CAPTION>
                   NAME OF DEPOSITARY
GRANTOR            BANK                             ACCOUNT NUMBER                  ACCOUNT NAME
-------            ------------------               --------------                  ------------
<S>                <C>                              <C>                             <C>

</TABLE>

         (c)      Deposit Accounts: Collection Account

<TABLE>
<CAPTION>
                     NAME OF DEPOSITARY
GRANTOR              BANK                             ACCOUNT NUMBER                 ACCOUNT NAME
-------              ------------------               --------------                 ------------
<S>                  <C>                              <C>                            <C>

</TABLE>

                                 EXHIBIT 4.4-2
<PAGE>

                                                                   SCHEDULE 4.6
                                               TO PLEDGE AND SECURITY AGREEMENT

<TABLE>
<CAPTION>
Name of Grantor                     Description of Letters of Credit
---------------                     --------------------------------
<S>                                 <C>

</TABLE>

                                SCHEDULE 4.6-1
<PAGE>

                                                                   SCHEDULE 4.7
                                               TO PLEDGE AND SECURITY AGREEMENT

                             INTELLECTUAL PROPERTY

(A)      Copyrights
(B)      Copyright Licenses
(C)      Patents
(D)      Patent Licenses
(E)      Trademarks
(F)      Trademark Licenses
(G)      Trade Secret Licenses
(H)      Intellectual Property Matters

                                SCHEDULE 4.7-1
<PAGE>

                                                                   SCHEDULE 4.8
                                               TO PLEDGE AND SECURITY AGREEMENT

<TABLE>
<CAPTION>
Name of Grantor                              Commercial Tort Claims
---------------                              ----------------------
<S>                                          <C>

</TABLE>

                                SCHEDULE 4.8-1
<PAGE>

                                                                      EXHIBIT A
                                               TO PLEDGE AND SECURITY AGREEMENT

                               PLEDGE SUPPLEMENT

         This PLEDGE SUPPLEMENT, dated [MM/DD/YY], is delivered pursuant to the
Pledge and Security Agreement, dated as of [MM/DD/YY] (as it may be from time
to time amended, restated, modified or supplemented, the "SECURITY AGREEMENT"),
among [NAME OF COMPANY], the other Grantors named therein, and RESIDENTIAL
FUNDING CORPORATION DBA GMAC-RFC HEALTH CAPITAL, as the Joint Collateral Agent.
Capitalized terms used herein not otherwise defined herein shall have the
meanings ascribed thereto in the Security Agreement.

         Grantor hereby confirms the grant to the Joint Collateral Agent set
forth in the Security Agreement of, and does hereby grant to the Joint
Collateral Agent, a security interest in all of Grantor's right, title and
interest in and to all Collateral to secure the Secured Obligations, in each
case whether now or hereafter existing or in which Grantor now has or hereafter
acquires an interest and wherever the same may be located. Grantor represents
and warrants that the attached Supplements to Schedules accurately and
completely set forth all additional information required pursuant to the
Security Agreement and hereby agrees that such Supplements to Schedules shall
constitute part of the Schedules to the Security Agreement.

         IN WITNESS WHEREOF, Grantor has caused this Pledge Supplement to be
duly executed and delivered by its duly authorized officer as of [MM/DD/YY].

                                    [NAME OF GRANTOR]

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

                                  EXHIBIT A-1
<PAGE>

                                               SUPPLEMENT TO SCHEDULE 1.1
                                               TO PLEDGE AND SECURITY AGREEMENT

                         EXCLUDED SUBSIDIARY INTERESTS

Name of Entity:

                                  EXHIBIT 1.1
<PAGE>

                                               SUPPLEMENT TO SCHEDULE 4.1
                                               TO PLEDGE AND SECURITY AGREEMENT

Additional Information:

(A)      Full Legal Name, Type of Organization, Jurisdiction of Organization,
         Chief Executive Office/Sole Place of Business (or Residence if Grantor
         is a Natural Person) and Organizational Identification Number of each
         Grantor:

<TABLE>
<CAPTION>
                                                                           Chief Executive
                                                                           Office/Sole Place of
                                                                           Business (or Residence
                                                      Jurisdiction of      if Grantor is a Natural
Full Legal Name          Type of Organization         Organization         Person)                       Organization I.D.#
---------------          --------------------         ---------------      -----------------------       ------------------
<S>                      <C>                          <C>                  <C>                           <C>

</TABLE>

(B)      Other Names (including any Trade-Name or Fictitious Business Name)
         under which each Grantor has conducted business for the past five (5)
         years:

<TABLE>
<CAPTION>
Name of Grantor                              Description of Agreement
---------------                              ------------------------
<S>                                          <C>

</TABLE>

(C)      Changes in Name, Jurisdiction of Organization, Chief Executive Office
         or Sole Place of Business (or Principal Residence if Grantor is a
         Natural Person) and Corporate Structure within past five (5) years:

<TABLE>
<CAPTION>
Full Legal Name                     Trade Name or Fictitious Business Name
---------------                     --------------------------------------
<S>                                 <C>

</TABLE>

(D)      Agreements pursuant to which any Grantor is found as debtor within
         past five (5) years:

<TABLE>
<CAPTION>
Name of Grantor                     Date of Change                      Description of Change
---------------                     --------------                      ---------------------
<S>                                 <C>                                 <C>

</TABLE>

(E)      Initial Financing Statements:

                                  EXHIBIT 1.2
<PAGE>

<TABLE>
<CAPTION>
Name of Grantor                              Filing Jurisdiction(s)
---------------                              ----------------------
<S>                                          <C>

</TABLE>

(F)      Consents:

(G)      Existing Financing Statements:

                                  EXHIBIT 1.3
<PAGE>

                                                     SUPPLEMENT TO SCHEDULE 4.2
                                               TO PLEDGE AND SECURITY AGREEMENT

Additional Information:

<TABLE>
<CAPTION>
Name of Grantor                              Location of Equipment and Inventory
---------------                              -----------------------------------
<S>                                          <C>

</TABLE>

                                  EXHIBIT 1.4
<PAGE>

                                                     SUPPLEMENT TO SCHEDULE 4.4
                                               TO PLEDGE AND SECURITY AGREEMENT

Additional Information:

(A)

Pledged Stock:

Pledged Partnership Interests:

Pledged LLC Interests:

Pledged Trust Interests:

Pledged Debt:

Securities Account:

Commodities Accounts:

Deposit Accounts:

                                  EXHIBIT 1.5
<PAGE>

                                                     SUPPLEMENT TO SCHEDULE 4.6
                                               TO PLEDGE AND SECURITY AGREEMENT

Additional Information:

<TABLE>
<CAPTION>
Name of Grantor                              Description of Letters of Credit
---------------                              --------------------------------
<S>                                          <C>

</TABLE>

                                  EXHIBIT 1.6
<PAGE>

                                                     SUPPLEMENT TO SCHEDULE 4.7
                                               TO PLEDGE AND SECURITY AGREEMENT

Additional Information:

(A)      Copyrights

(B)      Copyright Licenses

(C)      Patents

(D)      Patent Licenses

(E)      Trademarks

(F)      Trademark Licenses

(G)      Trade Secret Licenses

(H)      Intellectual Property Matters

                                  EXHIBIT 1.7
<PAGE>

                                                     SUPPLEMENT TO SCHEDULE 4.8
                                               TO PLEDGE AND SECURITY AGREEMENT

Additional Information:

<TABLE>
<CAPTION>
Name of Grantor                     Commercial Tort Claims
---------------                     ----------------------
<S>                                 <C>

</TABLE>

                                  EXHIBIT 1.8
<PAGE>

                                                                      EXHIBIT B
                                               TO PLEDGE AND SECURITY AGREEMENT

                  UNCERTIFICATED SECURITIES CONTROL AGREEMENT

         This Uncertificated Securities Control Agreement dated as of
_________, 200_ among ________________ (the "PLEDGOR"), RESIDENTIAL FUNDING
CORPORATION DBA GMAC-RFC HEALTH CAPITAL, as joint collateral agent for the
Secured Parties, (the "JOINT COLLATERAL AGENT") and ____________, a
________corporation (the "ISSUER"). Capitalized terms used but not defined
herein shall have the meaning assigned in the Pledge and Security Agreement
dated as of May [10], 2002 among the Pledgor, the other Grantors party thereto
and the Joint Collateral Agent (the "SECURITY AGREEMENT"). All references
herein to the "UCC" shall mean the Uniform Commercial Code as in effect in the
State of New York.

         SECTION 1.        REGISTERED OWNERSHIP OF SHARES. The Issuer hereby
confirms and agrees that as of the date hereof the Pledgor is the registered
owner of __________ shares of the Issuer's [common] stock (the "PLEDGED
SHARES") and the Issuer shall not change the registered owner of the Pledged
Shares without the prior written consent of the Collateral Agent.

         SECTION 2.        INSTRUCTIONS. If at any time the Issuer shall
receive instructions originated by the Collateral Agent relating to the Pledged
Shares, the Issuer shall comply with such instructions without further consent
by the Pledgor or any other person.

         SECTION 3.        ADDITIONAL REPRESENTATIONS AND WARRANTIES OF THE
ISSUER. The Issuer hereby represents and warrants to the Joint Collateral
Agent:

         (a)      It has not entered into, and until the termination of the
this agreement will not enter into, any agreement with any other person
relating the Pledged Shares pursuant to which it has agreed to comply with
instructions issued by such other person; and

         (b)      It has not entered into, and until the termination of this
agreement will not enter into, any agreement with the Pledgor or the Joint
Collateral Agent purporting to limit or condition the obligation of the Issuer
to comply with Instructions as set forth in Section 2 hereof.

         (c)      Except for the claims and interest of the Joint Collateral
Agent and of the Pledgor in the Pledged Shares, the Issuer does not know of any
claim to, or interest in, the Pledged Shares. If any person asserts any lien,
encumbrance or adverse claim (including any writ, garnishment, judgment,
warrant of attachment, execution or similar process) against the Pledged
Shares, the Issuer will promptly notify the Joint Collateral Agent and the
Pledgor thereof.

         (d)      This Uncertificated Securities Control Agreement is the valid
and legally binding obligation of the Issuer.

         SECTION 4.        CHOICE OF LAW. This Agreement shall be governed by
the laws of the State of [New York].

         SECTION 5.        CONFLICT WITH OTHER AGREEMENTS. In the event of any
conflict between this Agreement (or any portion thereof) and any other
agreement now existing or hereafter entered

                                  Exhibit B-1
<PAGE>

into, the terms of this Agreement shall prevail. No amendment or modification
of this Agreement or waiver of any right hereunder shall be binding on any
party hereto unless it is in writing and is signed by all of the parties
hereto.

         SECTION 6.        VOTING RIGHTS. Until such time as the Joint
Collateral Agent shall otherwise instruct the Issuer in writing, the Pledgor
shall have the right to vote the Pledged Shares.

         SECTION 7.        SUCCESSORS; ASSIGNMENT. The terms of this Agreement
shall be binding upon, and shall inure to the benefit of, the parties hereto
and their respective corporate successors or heirs and personal representatives
who obtain such rights solely by operation of law. The Joint Collateral Agent
may assign its rights hereunder only with the express written consent of the
Issuer and by sending written notice of such assignment to the Pledgor.

         SECTION 8.        INDEMNIFICATION OF ISSUER. The Pledgor and the Joint
Collateral Agent hereby agree that (a) the Issuer is released from any and all
liabilities to the Pledgor and the Joint Collateral Agent arising from the
terms of this Agreement and the compliance of the Issuer with the terms hereof,
except to the extent that such liabilities arise from the Issuer's negligence
and (b) the Pledgor, its successors and assigns shall at all times indemnify
and save harmless the Issuer from and against any and all claims, actions and
suits of others arising out of the terms of this Agreement or the compliance of
the Issuer with the terms hereof, except to the extent that such arises from
the Issuer's negligence, and from and against any and all liabilities, losses,
damages, costs, charges, counsel fees and other expenses of every nature and
character arising by reason of the same, until the termination of this
Agreement.

         SECTION 9.        NOTICES. Any notice, request or other communication
required or permitted to be given under this Agreement shall be in writing and
deemed to have been properly given when delivered in person, or when sent by
telecopy or other electronic means and electronic confirmation of error free
receipt is received or two (2) days after being sent by certified or registered
United States mail, return receipt requested, postage prepaid, addressed to the
party at the address set forth below.

         Pledgor:                   [INSERT ADDRESS]
                                    Attention:
                                    Telecopier:

         Joint Collateral Agent:    [INSERT ADDRESS]
                                    Attention:
                                    Telecopier:

         Issuer:                    [INSERT ADDRESS]
                                    Attention:
                                    Telecopier:

         Any party may change its address for notices in the manner set forth
above.

         SECTION 10.       TERMINATION. The obligations of the Issuer to the
Joint Collateral Agent pursuant to this Control Agreement shall continue in
effect until the security interests of the Joint Collateral Agent in the
Pledged Shares have been terminated pursuant to the terms of the Security
Agreement and the Joint Collateral Agent has notified the Issuer of such
termination in writing. The Joint Collateral Agent agrees to provide Notice of
Termination in substantially the form of Exhibit A hereto to the Issuer upon
the request of the Pledgor on or after the termination of the

                                  Exhibit B-2
<PAGE>

Joint Collateral Agent's security interest in the Pledged Shares pursuant to
the terms of the Security Agreement. The termination of this Control Agreement
shall not terminate the Pledged Shares or alter the obligations of the Issuer
to the Pledgor pursuant to any other agreement with respect to the Pledged
Shares.

         SECTION 11.       COUNTERPARTS. This Agreement may be executed in any
number of counterparts, all of which shall constitute one and the same
instrument, and any party hereto may execute this Agreement by signing and
delivering one or more counterparts.

                                    [NAME OF PLEDGOR]

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

                                    RESIDENTIAL FUNDING CORPORATION dba
                                    GMAC-RFC HEALTH CAPITAL, as Joint
                                    Collateral Agent

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

                                    [NAME OF ISSUER]

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

                                  Exhibit B-3
<PAGE>

                                                                      Exhibit A

                     [Letterhead of Joint Collateral Agent]

                                     [Date]

[Name and Address of Issuer]

Attention:
          --------------------------

                      Re: Termination of Control Agreement

         You are hereby notified that the Uncertificated Securities Control
Agreement between you, [the Pledgor] and the undersigned (a copy of which is
attached) is terminated and you have no further obligations to the undersigned
pursuant to such Agreement. Notwithstanding any previous instructions to you,
you are hereby instructed to accept all future directions with respect to
Pledged Shares (as defined in the Uncertificated Control Agreement) from [the
Pledgor]. This notice terminates any obligations you may have to the
undersigned with respect to the Pledged Shares, however nothing contained in
this notice shall alter any obligations which you may otherwise owe to [the
Pledgor] pursuant to any other agreement.

         You are instructed to deliver a copy of this notice by facsimile
transmission to [insert name of Pledgor].

                                    Very truly yours,

                                    RESIDENTIAL FUNDING CORPORATION dba
                                    GMAC-RFC HEALTH CAPITAL, as Joint
                                    Collateral Agent

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

                                  Exhibit A-1
<PAGE>

                                                                      EXHIBIT C
                                               TO PLEDGE AND SECURITY AGREEMENT

                  FORM OF COLLATERAL ACCOUNT CONTROL AGREEMENT

         This Collateral Account Control Agreement dated as of __________,
200[ ] among ________________ (the "Debtor"), RESIDENTIAL FUNDING CORPORATION
DBA GMAC-RFC HEALTH CAPITAL, as [Joint Collateral Agent for the Secured Parties]
(the "JOINT COLLATERAL AGENT") and ____________ in its capacity as a
"securities intermediary" (as defined in Section 8-102 of the UCC and a "bank"
as defined in Section 9-102 of the UCC (in such capacities, the "Financial
Institution"). Capitalized terms used but not defined herein shall have the
meaning assigned in the Pledge and Security Agreement dated as of _________,
2002 between the Debtor, the other grantors therein and the Joint Collateral
Agent (the "Security Agreement"). All references herein to the "UCC" shall mean
the Uniform Commercial Code as in effect in the State of New York.

1.       ESTABLISHMENT OF COLLATERAL ACCOUNTS. The Financial Institution hereby
         confirms and agrees that:

         (a)      The Financial Institution has established the following
                  accounts:

                  (i)      the "[IDENTIFY EXACT TITLE OF ACCOUNT]" with account
                           number [IDENTIFY ACCOUNT NUMBER] in the name
                           "[IDENTIFY EXACT TITLE OF ACCOUNT]" in the name of
                           "[identify name of account holder]" (the "_____
                           Account");

                  (ii)     the "[identify exact title of account]" with account
                           number [identify account number] in the name
                           "[identify exact title of account]" in the name of
                           "[identify name of account holder]" (the "_____
                           Account"); and

                  (iii)    the "[IDENTIFY EXACT TITLE OF ACCOUNT]" with account
                           number [IDENTIFY ACCOUNT NUMBER] in the name
                           "[IDENTIFY EXACT TITLE OF ACCOUNT]" in the name of
                           "[identify name of account holder]" (the "_____
                           Account").

Each such account and any successor account, being referred to herein
individually as a "Pledged Account" and collectively as the "Pledged Accounts."
The Financial Institution shall not change the name or account number of any
Pledged Account without the prior written consent of the Secured Party(1);

         (b)      Each of the Pledged Accounts are either a "securities
                  account" (as defined in Section 8-501 of the UCC) or a
                  "deposit account" as defined in Section 9-102(a)(29) of the
                  UCC). The Financial Intermediary acknowledges and agrees that
                  the ____ Account[s] are intended to be deposit accounts and
                  the _________ Account[s] are intended to be securities
                  accounts. Notwithstanding such intention, as used herein
                  "Deposit Account" shall mean any Pledged Account which is
                  determined to be a "deposit account" (within

                                  Exhibit C-1
<PAGE>

                  the meaning of Section 9-102(a)(29) of the UCC and
                  "Securities Account" shall mean any Pledged Account which is
                  determined to be a "securities account" (within the meaning
                  of Section 8-501 of the UCC .

         (c)      All securities or other property underlying any financial
                  assets credited to any Securities Account shall be registered
                  in the name of the Financial Institution, indorsed to the
                  Financial Institution or in blank or credited to another
                  securities account maintained in the name of the Financial
                  Institution and in no case will any financial asset credited
                  to any Securities Account be registered in the name of the
                  Debtor, payable to the order of the Debtor or specially
                  indorsed to the Debtor except to the extent the foregoing
                  have been specially indorsed to the Financial Institution or
                  in blank;

         (d)      All property delivered to the Financial Institution pursuant
                  to the Security Agreement will be promptly credited to one of
                  the Pledged Accounts.

2.       "FINANCIAL ASSETS" ELECTION. The Financial Institution hereby agrees
         that each item of property (whether investment property, financial
         asset, security, instrument or cash) credited to any Pledged Account
         that is a Securities Account shall be treated as a "financial asset"
         within the meaning of Section 8-102(a)(9) of the UCC.

3.       CONTROL OF THE PLEDGED ACCOUNTS. If at any time the Financial
         Institution shall receive any order from the Joint Collateral Agent
         directing transfer or redemption of any financial asset relating to a
         Pledged Account or any instruction originated by the Joint Collateral
         Agent directing the disposition of funds in a Pledged Account, the
         Financial Institution shall comply with such entitlement order or
         instruction without further consent by the Debtor or any other person.

4.       SUBORDINATION OF LIEN; WAIVER OF SET-OFF. In the event that the
         Financial Institution has or subsequently obtains by agreement, by
         operation of law or otherwise a security interest in any Pledged
         Account or any security entitlement or cash credited thereto, the
         Financial Institution hereby agrees that such security interest shall
         be subordinate to the security interest of the Joint Collateral Agent.
         The financial assets, money and other items credited to any Pledged
         Account will not be subject to deduction, set-off, banker's lien, or
         any other right in favor of any person other than the Secured Party
         (except that the Financial Institution may set off (i) all amounts due
         to the Financial Institution in respect of customary fees and expenses
         for the routine maintenance and operation of the respective Pledged
         Account and (ii) the face amount of any checks which have been
         credited to such Pledged Account but are subsequently returned unpaid
         because of uncollected or insufficient funds).

5.       CHOICE OF LAW. This Agreement shall each be governed by the laws of
         the State of New York. Regardless of any provision in any other
         agreement, for purposes of the UCC, New York shall be deemed to be the
         Financial Institution's jurisdiction (within the meaning of Section
         9-304 of the UCC and Section 8-110 of the UCC). The Pledged Accounts
         shall be governed by the laws of the State of New York.

                                  Exhibit C-2
<PAGE>

6.       CONFLICT WITH OTHER AGREEMENTS.

         (a)      In the event of any conflict between this Agreement (or any
                  portion thereof) and any other agreement now existing or
                  hereafter entered into, the terms of this Agreement shall
                  prevail;

         (b)      No amendment or modification of this Agreement or waiver of
                  any right hereunder shall be binding on any party hereto
                  unless it is in writing and is signed by all of the parties
                  hereto;

         (c)      The Financial Institution hereby confirms and agrees that:

                  (i)      There are no other agreements entered into between
                           the Financial Institution and the Debtor with
                           respect to any Pledged Account [EXCEPT FOR [IDENTIFY
                           OTHER AGREEMENTS] (THE "ACCOUNT AGREEMENTS")];

                  (ii)     It has not entered into, and until the termination
                           of the this agreement will not enter into, any
                           agreement with any other person relating the Pledged
                           Accounts and/or any financial assets credited
                           thereto pursuant to which it has agreed to comply
                           with entitlement orders (as defined in Section
                           8-102(a)(8) of the UCC) or instructions (within the
                           meaning of Section 9-104 of the UCC) of such other
                           person; and

                  (iii)    It has not entered into, and until the termination
                           of this agreement will not enter into, any agreement
                           with the Debtor or the Joint Collateral Agent
                           purporting to limit or condition the obligation of
                           the Financial Institution to comply with entitlement
                           orders or instructions.

7.       ADVERSE CLAIMS. Except for the claims and interest of the Joint
         Collateral Agent and of the Debtor in the Pledged Accounts, the
         Financial Institution does not know of any lien on or claim to, or
         interest in, any Pledged Account or in any "financial asset" (as
         defined in Section 8-102(a) of the UCC) credited thereto. If any
         person asserts any lien, encumbrance or adverse claim (including any
         writ, garnishment, judgment, warrant of attachment, execution or
         similar process) against the Pledged Accounts or in any financial
         asset carried therein, the Financial Institution will promptly notify
         the Joint Collateral Agent and the Debtor thereof.

8.       MAINTENANCE OF ACCOUNTS. In addition to, and not in lieu of, the
         obligation of the Financial Institution to honor entitlement orders
         and instructions as set forth in Section 3 hereof, the Financial
         Institution agrees to maintain the Pledged Accounts as follows:

         (a)      Notice of Sole Control. If at any time the Joint Collateral
                  Agent delivers to the Financial Institution a Notice of Sole
                  Control in substantially the form set forth in Exhibit A
                  hereto,

                                  Exhibit C-3
<PAGE>

                  the Financial Institution agrees that after receipt of such
                  notice, it will take all instruction with respect to the
                  Pledged Accounts solely from the Joint Collateral Agent and
                  shall not comply with instructions or entitlement orders of
                  any other person.

         (b)      Statements and Confirmations. The Financial Institution will
                  promptly send copies of all statements, confirmations and
                  other correspondence concerning (i) any Securities Account
                  and/or any financial assets credited thereto and (ii) any
                  Deposit Account, simultaneously to each of the Debtor and the
                  Joint Collateral Agent at the address for each set forth in
                  Section 12 of this Agreement.

         (c)      Tax Reporting. All items of income, gain, expense and loss
                  recognized in any Securities Account and all interest, if
                  any, relating to any Deposit Account, shall be reported to
                  the Internal Revenue Service and all state and local taxing
                  authorities under the name and taxpayer identification number
                  of the Debtor.

         (d)      Voting Rights. Until such time as the Financial Institution
                  receives a Notice of Sole Control pursuant to subsection (a)
                  of this Section 8, the Debtor shall direct the Financial
                  Institution with respect to the voting of any financial
                  assets credited to the Pledged Accounts.

         (e)      Permitted Investments. Until such time as the Financial
                  Institution receives a Notice of Sole Control signed by the
                  Joint Collateral Agent, the Debtor shall direct the Financial
                  Institution with respect to the selection of investments to
                  be made for any Pledged Account that is a securities account;
                  provided, however, that the Financial Institution shall not
                  honor any instruction to purchase any investments other than
                  investments of a type describe on Exhibit B hereto.

9.       REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE FINANCIAL
         INSTITUTION. The Financial Institution hereby makes the following
         representations, warranties and covenants:

         (a)      The Pledged Accounts have each been established as set forth
                  in Section 1 and such Pledged Accounts will be maintained in
                  the manner set forth herein until termination of this
                  Agreement; and

         (b)      This Collateral Account Control Agreement is the valid and
                  legally binding obligations of the Financial Institution.

10.      INDEMNIFICATION OF FINANCIAL INSTITUTION. The Debtor and the Joint
         Collateral Agent hereby agree that (a) the Financial Institution is
         released from any and all liabilities to the Debtor and the Joint
         Collateral Agent arising from the terms of this agreement and the
         compliance of the Financial Institution with the terms hereof, except
         to the extent that such liabilities arise from the Financial
         Institution's negligence and (b) the Debtor, its successors and
         assigns shall at all times indemnify and save harmless the Financial
         Institution from and against any and all claims, actions and suits of
         others arising out of the terms of this agreement or the compliance of
         the Financial Institution with the terms hereof, except to the extent
         that such arises from the Financial Institution's negligence, and from
         and against any and all liabilities, losses, damages, costs,

                                  Exhibit C-4
<PAGE>

         charges, counsel fees and other expenses of every nature and character
         arising by reason of the same, until the termination of this
         agreement.

11.      SUCCESSORS; ASSIGNMENT. The terms of this Agreement shall be binding
         upon, and shall inure to the benefit of, the parties hereto and their
         respective corporate successors or heirs and personal representatives
         who obtain such rights solely by operation of law. The Joint
         Collateral Agent may assign its rights hereunder only with the express
         written consent of the Financial Institution and by sending written
         notice of such assignment to the Debtor.

12.      NOTICES. Any notice, request or other communication required or
         permitted to be given under this Agreement shall be in writing and
         deemed to have been properly given when delivered in person, or when
         sent by telecopy or other electronic means and electronic confirmation
         of error free receipt is received or two days after being sent by
         certified or registered United States mail, return receipt requested,
         postage prepaid, addressed to the party at the address set forth
         below.

         Debtor:

         Joint Collateral Agent:

         Financial Institution:

                  Any party may change his address for notices in the manner
                  set forth above.

13.      TERMINATION. The obligations of the Financial Institution to the Joint
         Collateral Agent pursuant to this Control Agreement shall continue in
         effect until the security interests of the Joint Collateral Agent in
         each of the Pledged Accounts have been terminated pursuant to the
         terms of the Security Agreement and the Joint Collateral Agent has
         notified the Financial Institution of such termination in writing. The
         Joint Collateral Agent agrees to provide Notice of Termination in
         substantially the form of Exhibit C hereto to the Financial
         Institution upon the request of the Debtor on or after the termination
         of the Joint Collateral Agent's security interest in the Pledged
         Accounts pursuant to the terms of the Security Agreement. The
         termination of this Control Agreement shall not terminate the Pledged
         Accounts or alter the obligations of the Financial Institution to the
         Debtor pursuant to any other agreement with respect to the Pledged
         Accounts.

                                  Exhibit C-5
<PAGE>

14.      COUNTERPARTS. This Agreement may be executed in any number of
         counterparts, all of which shall constitute one and the same
         instrument, and any party hereto may execute this Agreement by signing
         and delivering one or more counterparts.

                                    [NAME OF DEBTOR]

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

                                    RESIDENTIAL FUNDING CORPORATION DBA
                                    GMAC-RFC HEALTH CAPITAL, as Joint
                                    Collateral Agent

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

                                    [NAME OF INSTITUTION SERVING AS FINANCIAL
                                    INSTITUTION]

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

                                  Exhibit C-6
<PAGE>

                                                                      Exhibit A

                     [Letterhead of Joint Collateral Agent]

                                     [Date]

[Name and Address of Financial Institution]

Attention: _____________________

                  Re:  Notice of Sole Control

Ladies and Gentlemen:

                  As referenced in the Collateral Account Control Agreement,
dated _______, 200_, among [insert name of the Debtor], you and the undersigned
(a copy of which is attached) we hereby give you notice of our sole control
over each of the Pledged Accounts and all financial assets or funds credited
thereto. You are hereby instructed not to accept any direction, instructions or
entitlement orders or instructions with respect to the Pledged Accounts or the
financial assets or funds credited thereto from any person other than the
undersigned, unless otherwise ordered by a court of competent jurisdiction.

                  You are instructed to deliver a copy of this notice by
facsimile transmission to [insert name of the Debtor].

                                    Very truly yours,

                                    RESIDENTIAL FUNDING CORPORATION dba
                                    GMAC-RFC HEALTH CAPITAL, as Joint
                                    Collateral Agent

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

cc:  [Name of Debtor]

                                 Exhibit C-A-1
<PAGE>

                                                                      Exhibit B

                             Permitted Investments

                                 Exhibit C-B-1
<PAGE>

                                                                      Exhibit C

                     [Letterhead of Joint Collateral Agent]

                                     [Date]

[Name and Address of Financial Institution]

Attention:

                  Re:     Termination of Collateral Account
                          Control Agreement

                  You are hereby notified that the Collateral Account Control
Agreement between you, [THE DEBTOR] and the undersigned (a copy of which is
attached) is terminated and you have no further obligations to the undersigned
pursuant to such Agreement. Notwithstanding any previous instructions to you,
you are hereby instructed to accept all future directions with respect to
account number(s) ___________ from [THE DEBTOR]. This notice terminates any
obligations you may have to the undersigned with respect to such account,
however nothing contained in this notice shall alter any obligations which you
may otherwise owe to [THE DEBTOR] pursuant to any other agreement.

                  You are instructed to deliver a copy of this notice by
facsimile transmission to [insert name of Debtor].

                                    Very truly yours,

                                    RESIDENTIAL FUNDING CORPORATION dba
                                    GMAC-RFC HEALTH CAPITAL, as Joint
                                    Collateral Agent

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

cc:  [Name of Debtor]

                                 Exhibit C-C-1
<PAGE>

                                                                      EXHIBIT D
                                               TO PLEDGE AND SECURITY AGREEMENT

              FORM OF PERSONAL PROPERTY SECURITY INTEREST OPINION

                                 [INSERT DATE]

[INSERT FULL NAME AND ADDRESS OF THE JOINT COLLATERAL AGENT]

                  RE:  MARINER HEALTH CARE, INC.

Ladies and Gentlemen:

                  We have acted as special counsel to Mariner Health Care,
Inc., a Delaware corporation (the "Borrower"), each of the Borrower's
subsidiaries listed on Schedule 1 hereto (each of the Borrower and such other
loan parties, a "Grantor" and, collectively, the "Grantors"), in connection
with the preparation, execution and delivery of the Pledge and Security
Agreement, dated [the date hereof] (the "Security Agreement"), between each of
the Grantors and Residential Funding Corporation dba GMAC-RFC HEALTH CAPITAL,
as [Joint Collateral Agent] for the [Secured Parties] (as defined in the
Security Agreement) (the "Joint Collateral Agent"). This opinion is being
delivered pursuant to Section [ ] of the Security Agreement.

                  In our examination we have assumed the genuineness of all
signatures including endorsements, the legal capacity of natural persons, the
authenticity of all documents submitted to us as originals, the conformity to
original documents of all documents submitted to us as facsimile, electronic,
certified or photostatic copies, and the authenticity of the originals of such
copies. As to any facts material to this opinion which we did not independently
establish or verify, we have relied upon statements and representations of the
Grantors and their officers and other representatives and of public officials,
including the facts and conclusions set forth therein.

                  In rendering the opinions set forth herein, we have examined
and relied on originals or copies of the following:

                  (a)      the Security Agreement;

                  (b)      [ the letter, dated [INSERT DATE] from each Grantor
to the Joint Collateral Agent authorizing the filing of UCC financing
statements (the "Authorization Letter");]

                  (c)      an acknowledgment copy of a financing statement
bearing file date _____ and file number _____ [ALTERNATIVELY: an unfiled copy
of a financing statement]

                                  Exhibit D-1
<PAGE>

[ALTERNATIVELY: a print out of a confirmation of an electronic data
transmission of financing statement information, bearing file date_____ and
file number_____] identifying the name of each Grantor listed on Schedule 2
hereto, as debtor and "Residential Funding Corporation dba GMAC-RFC HEALTH
CAPITAL, as Joint Collateral Agent", as secured party, which was filed
[ALTERNATIVELY: we understand will be filed within ten (10) days of the
transfer of the security interest] in the filing office identified opposite
each Grantor's name on Schedule 2 hereto (such filing office(s), the "Filing
Office(s)" and such financing statement, the "Financing Statement(s)");

                  (d)      the account agreement dated as of ________ between
[IDENTIFY NAME OF APPLICABLE GRANTOR] and the Financial Institution pursuant to
which the Pledged Account (as such terms are defined below) was established;

                  (e)      a certified copy of the organization document
identified on Schedule 3 hereto as to each Grantor's existence in such state
(the "Secretary of State Certificates"); and

                  (f)      such other documents as we have deemed necessary or
appropriate as a basis for the opinions set forth below.

                  Capitalized terms used herein and not otherwise defined
herein shall have the same meanings as set forth in the Security Agreement. As
used herein:

                  (i)      "UCC" means (a) the New York UCC, (b) the Filing
State UCC, and (c) the [IDENTIFY NAME OF STATE OF FINANCIAL INSTITUTION'S
JURISDICTION AS IDENTIFIED IN (VIII) BELOW] UCC (in each case as such term is
defined below), as applicable.

                  (ii)     "UCC Collateral" means the Collateral (as such term
is defined in the Security Agreement) to the extent such collateral is of a
type subject to Article 9 of the UCC.

                  (iii)    "Delaware UCC" means the Uniform Commercial Code as
in effect on the date hereof in the State of Delaware (without regard to laws
referenced in Section 9-201 thereof).

                  (iv)     "New York UCC" means the Uniform Commercial Code as
in effect on the date hereof in the State of New York (without regard to laws
referenced in Section 9-201 thereof).

                  (v)      "Filing State" means [IDENTIFY NAME OF STATE(S)
WHERE THE FINANCING STATEMENTS ARE FILED].

                  (vi)     "Filing State UCC" means the Uniform Commercial Code
as in effect on the date hereof in the Filing State (without regard to laws
referenced in Section 9-201 thereof).

                  (vii)    "Possessory Certificates" means the certificates
identified on Schedule 4 hereto.

                                  Exhibit D-2
<PAGE>

                  (viii)   "[IDENTIFY NAME OF STATE OF FINANCIAL INSTITUTION'S
JURISDICTION] UCC" means the Uniform Commercial Code as in effect on the date
hereof in the State of [IDENTIFY NAME OF STATE OF FINANCIAL INSTITUTION'S
JURISDICTION] (without regard to laws referenced in Section 9-201 thereof).

                 (ix)      "Pledged Account" means account number [INSERT
ACCOUNT NUMBER] established at [INSERT NAME OF FINANCIAL INSTITUTION THAT
ESTABLISHED THE PLEDGED ACCOUNT] in the name of [INSERT EXACT NAME ON ACCOUNT].

                  (X)      "Financial Institution" means [INSERT NAME OF
FINANCIAL INSTITUTION THAT ESTABLISHED THE PLEDGED ACCOUNT].

                  We express no opinion with respect to any laws other than the
UCC and, for purposes of opinion paragraph 5, [INSERT CORPORATE LAW OF FILING
STATE, E.G., THE DELAWARE GENERAL CORPORATION LAW].

                  We have this date delivered to you our opinion with respect
to the enforceability of the Security Agreement and certain other transaction
agreements. We call to your attention that the opinions set forth herein with
respect to the security interest of the Joint Collateral Agent are subject to
the qualifications contained in such other opinion.

                  Based upon the foregoing and subject to the limitations,
qualifications, exceptions and assumptions set forth herein, we are of the
opinion that:

                  1.       Under the Delaware UCC, the provisions of the
Security Agreement are effective to create a valid security interest in each
Grantor's rights in the UCC Collateral in favor of the Joint Collateral Agent
to secure the Secured Obligations (as defined in the Security Agreement).

                  2.       [TO BE GIVEN BY LOCAL COUNSEL, IF APPROPRIATE]
Pursuant to the [Authorization Letter][Security Agreement], each Grantor has
authorized for purposes of Section 9-509 of the Filing State UCC the filing of
the Financing Statement naming such Grantor as debtor and identifying the UCC
Collateral.

                  3.       [TO BE GIVEN BY LOCAL COUNSEL, IF APPROPRIATE] Each
of the Financing Statements includes not only all of the types of information
required by Section 9-502(a) of the Filing State UCC but also the types of
information without which the Filing Office may refuse to accept the Financing
Statements pursuant to Section 9-516 of the Filing State UCC.

                  4.       [TO BE GIVEN BY LOCAL COUNSEL, IF APPROPRIATE] Under
the Filing State UCC, the security interest of the Joint Collateral Agent will
be perfected in each of the Grantor's rights in all UCC Collateral upon the
later of the attachment of the security interest and the filing

                                  Exhibit D-3
<PAGE>

of the Financing Statements in the Filing Office, we express no opinion, with
respect to (i) money, (ii) deposit accounts, (iii) letter of credit rights (iv)
goods covered by a certificate of title statute, (v) as-extracted collateral,
timber to be cut, (vi) any property subject to a statute, regulation or treaty
of the United States whose requirements for a security interest's obtaining
priority over the rights of a lien creditor with respect to the property
preempt Section 9-310(a) of the Filing State UCC or (vii) any goods subject to
a negotiable document of title.

                  5.       [TO BE GIVEN BY LOCAL COUNSEL, IF APPROPRIATE] You
have asked whether each Grantor is a "registered organization" as defined in
the Filing State UCC. Pursuant to [IDENTIFY SECTION REFERENCE OF APPLICABLE
CORPORATE LAW, E.G., SS.SS.101(A) AND 103(6) OF THE DELAWARE GENERAL
CORPORATION LAW], the [SECRETARY OF STATE] of the Filing State is required to
maintain a public record showing each Grantor to have been organized. Based on
our review of the Secretary of State Certificates, we are of the opinion that
under the Filing State UCC and the [INSERT CORPORATE LAW OF FILING STATE], each
Grantor is a "registered organization."

                  6.       Assuming that none of the Joint Collateral Agent or
any Secured Party has notice of any adverse claims with respect to the
Possessory Certificates and that such certificates are indorsed in blank or by
an effective indorsement to the Joint Collateral Agent, the Joint Collateral
Agent will acquire such Possessory Certificates (and the shares represented
thereby) free of any adverse claims under Section 8-303 of the New York UCC
upon the later of the attachment of the security interest and the delivery of
such Possessory Certificates to the Joint Collateral Agent. As used herein,
"notice of adverse claim" has the meaning set forth in Section 8-105 of the UCC
and includes, without limitation, any adverse claim that the Joint Collateral
Agent or any Secured Party would discover upon any investigation which such
person has a duty, imposed by statute or regulation, to investigate.

                  7.       Under the [IDENTIFY NAME OF STATE OF FINANCIAL
INSTITUTION'S JURISDICTION] UCC, the provisions of the Control Agreement are
effective to perfect the security interest of the Joint Collateral Agent in
[IDENTIFY NAME OF APPLICABLE GRANTOR]'s rights in the Pledged Account.

                  Our opinions are subject to the following qualifications:

                  (a)      We have assumed that each Grantor owns, or with
respect to after-acquired property will own, the UCC Collateral granted by it,
and we express no opinion as to the nature or extent of each Grantor's rights
in any of the applicable UCC Collateral and we note that with respect to any
after-acquired property, the security interest will not attach until such
Grantor acquires ownership thereof.

                  (b)      Our opinion with respect to proceeds is subject to
the limitations set forth in Section 9-315 of the UCC and, in addition, we call
to your attention that in the case of certain types of proceeds, other parties
such as holders in due course, protected purchasers of securities, persons who
obtain control over securities entitlements and buyers in the ordinary course
of

                                  Exhibit D-4
<PAGE>

business may acquire a superior interest or may take their interest free of the
security interest of a secured party.

                  (c)      We express no opinion with respect to commercial
tort claims.

                  (d)      We express no opinion with respect to any goods
which are accessions to, or commingled or processed with, other goods to the
extent that the security interest is limited by Section 9-335 or 9-336 of the
UCC.

                  (e)      We note that we have delivered to you our opinion
with respect to each Grantor's status as a "registered organization." Except to
the extent that this determination is an element of your choice of law
analysis, we express no opinion with respect to the choice of law governing
perfection, the effect of perfection and non-perfection or priority of the
security interest.

                  (f)      For purposes of our opinion paragraph 5, we have
assumed that each Grantor is and will remain "organized solely" (within the
meaning of Section 9-102(a)(70) of the UCC) under the laws of the State of the
Filing State.

                  (g)      We express no opinion with respect to the nature or
extent of the securities intermediary's rights in, or title to, the securities
or other financial assets underlying any "security entitlement" now or
hereafter credited to a securities account. Furthermore, we express no opinion
with respect to any property or assets now or hereafter credited to a
securities account that is not a "financial asset" and we express no opinion
whether or to what extent any particular item of property credited to such
securities account is a "financial asset". We note that to the extent the
securities intermediary maintains any financial asset in a "clearing
corporation" (as defined in Section 8-102(5) of the UCC), pursuant to Section
8-111 of the UCC, the rules of such clearing corporation may affect the rights
of the securities intermediary.

                  (h)      We have assumed that the Control Agreement is the
legal, valid, binding and enforceable obligation of each of the parties thereto
other than the applicable Grantor.

                  (i)      We have assumed that the Pledged Account is either a
"deposit account" (as defined in the UCC) and the Financial Institution is an
organization that is engaged in the business of banking or (ii) is a
"securities account"(as defined in the UCC) and the Financial Institution in
the ordinary course of its business maintains securities accounts for customers
and is acting in that capacity.

                  (j)      We call to your attention that pursuant to Section
9-340 of the UCC, a bank with which a deposit account is maintained may
continue to exercise any right of recoupment or set-off against a secured party
that holds a security interest in the deposit account.

         This opinion is being furnished only to you in connection with the
Security Agreement and is solely for your benefit and is not to be used,
circulated, quoted or otherwise referred to for any other purpose or relied
upon by any other person or entity for any purpose without our prior written
consent except that Loan Parties who subsequently become assignees pursuant to
Section __ of the Credit Agreement may rely on it as if it was addressed to the
collateral Agent for their benefit.

                                    Very truly yours,

                                  Exhibit D-5
<PAGE>

                                   SCHEDULE 1

               List of Subsidiaries of Mariner Health Care, Inc.

<TABLE>
<CAPTION>
FULL NAME OF GRANTOR                                  Jurisdiction of Organization
--------------------                                  ----------------------------
<S>                                                   <C>

</TABLE>

                                 Exhibit D-S-1
<PAGE>

                                   SCHEDULE 2

              Schedule Information on face of Financial Statements

<TABLE>
<CAPTION>
Full Name of         Full Name of                                        Filing
  Grantor           Secured Party            Filing Office            Jurisdiction            File Number              File Date
<S>                 <C>                      <C>                      <C>                     <C>                      <C>

</TABLE>

                                 Exhibit D-S-2
<PAGE>

                                   SCHEDULE 3

                          Certificates of Organization

<TABLE>
<CAPTION>
Full Name of        Type of Organization                                                                         Public Office(r)
  Grantor                 Document               State of Organization           Date of Certificates         Issuing Certificates
<S>                 <C>                          <C>                             <C>                          <C>

</TABLE>

                                 Exhibit D-S-3
<PAGE>

                                   SCHEDULE 4

                            Possessory Certificates

<TABLE>
<CAPTION>
Issuer            Certificate Numbers        Registered Owner           Number of Shares           Certificate Date
<S>               <C>                        <C>                        <C>                        <C>

</TABLE>

                                 Exhibit D-S-4<PAGE>
                  INTERCREDITOR AND COLLATERAL AGENCY AGREEMENT, dated as of
May 13, 2002, among (i) RESIDENTIAL FUNDING CORPORATION DBA GMAC-RFC HEALTH
CAPITAL ("GMAC"), as joint collateral agent hereunder (in such capacity,
together with its successors and assigns, the "Joint Collateral Agent"); (ii)
UBS AG, STAMFORD BRANCH ("UBS"), in its capacity as Administrative Agent (as
defined in the Credit Agreement referred to below); (iii) THE BANK OF NEW YORK,
a New York banking corporation, as trustee under the Rollover Note Indenture
referred to below (in such capacity, together with its successors and assigns,
the "Rollover Note Trustee"), and (iv) MARINER HEALTH CARE, INC. a Delaware
corporation ("Company") (the "Agreement").

INTRODUCTORY STATEMENT

                  WHEREAS, reference is made to that certain Credit and
Guaranty Agreement, dated as of the date hereof (as it may be amended,
restated, reframed supplemented or otherwise modified from time to time, the
"Credit Agreement"), by and among the Company, certain Subsidiaries of the
Company, as guarantors, the lenders party thereto from time to time (the
"Lenders"), Goldman Sachs Credit Partners L.P., as a Joint Lead Arranger and as
Syndication Agent, UBS Warburg LLC, as a Joint Lead Arranger, UBS, as
Administrative Agent and as Swing Line Lender, General Electric Capital
Corporation, as Documentation Agent, and as Collateral Monitoring Agent, and
for certain limited purposes, GMAC, as Joint Collateral Agent;

                  WHEREAS, reference is made to that certain Indenture, dated
as of the date hereof (as it may be amended restated, supplemented or otherwise
modified from time to time, the "Rollover Note Indenture"), by and among the
Company, certain Subsidiaries of the Company, as guarantors, and the Rollover
Note Trustee pursuant to which the Company has issued up to $150,000,000 of its
Second Priority Secured Notes due 2009 (the "Rollover Notes");

                  WHEREAS, in consideration of the extensions of credit and
other accommodations of Lenders and Lender Counterparties as set forth in the
Credit Agreement and the Hedge Agreements respectively, each Credit Party has
agreed to secure such Credit Party's obligations under the Credit Documents and
the Hedge Agreement as set forth in the Collateral Documents;

                  WHEREAS, in consideration of the purchase of the Rollover
Notes by the Rollover Noteholders as set forth in the Rollover Note Indenture,
each Credit Party has agreed to secure such Credit Party's obligations under
the Rollover Note Indenture and the Rollover Notes as set forth in the
Collateral Documents;

<PAGE>

                  WHEREAS, the execution of this Agreement is required by the
terms of the Credit Agreement and the Rollover Note Indenture; and

                  WHEREAS, the parties hereto desire to enter into this
Agreement to set forth the relative rights, remedies and options of the
respective parties under the aforementioned documents.

                  NOW, THEREFORE, the parties hereto agree as follows:

                  Section 1.        Definitions. (a) The following terms as
used herein (including, without limitation, in the introductory statement
hereof) shall have the following meanings:

                  "Administrative Agent" shall mean "Administrative Agent" as
such term is defined in the Credit Agreement.

                  "Authorized Officer" means, as applied to any Person, any
individual holding the position of chairman of the board (if an officer), chief
executive officer, president or one of its vice presidents (or the equivalent
thereof), and such Person's chief financial officer, chief accounting officer
or treasurer.

                   "Capital Stock" means any and all shares, interests,
participations or other equivalents (however designated) of capital stock of a
corporation, any and all equivalent ownership interests in a Person (other than
a corporation), including, without limitation, partnership interests and
membership interests, and any and all warrants, rights or options to purchase
or other arrangements or rights to acquire any of the foregoing.

                  "Cash Equivalents" shall mean any of the following: (i) full
faith and credit obligations of the United States of America, or fully
guaranteed as to interest and principal by the full faith and credit of the
United States of America, maturing in not more than one year from the date such
investment is made; (ii) time deposits and certificates of deposit having a
final maturity of not more than one year after the date of issuance thereof of
any commercial bank incorporated under the laws of the United States of America
or any state thereof or the District of Columbia, which bank is a member of the
Federal Reserve System and has a combined capital and surplus of not less than
$1,000,000,000.00 and with a senior unsecured debt credit rating of at least
"A" by Moody's Investors Service, Inc., or "A" by Standard & Poor's Ratings
Services; (iii) commercial paper of companies, banks, trust companies or
national banking associations incorporated or doing business under the laws of
the United States of America or one of the States thereof, in each case having
a remaining term until maturity of not more than one hundred eighty (180) days
from the date such investment is made and rated at least P-1 by Moody's
Investors Service, Inc. or at least A-1 by Standard & Poor's Ratings Group;
(iv) repurchase agreements with any financial institution having combined
capital and surplus of not less than $1,000,000,000.00 with a term of not more
than seven (7) days for underlying securities of the type referred to in clause
(i) above; and (v) money market funds which invest primarily in the Cash
Equivalents set forth in the preceding clauses (i)-(iv).

                                       2
<PAGE>

                  "Collateral" means, collectively, all the real, personal, and
mixed property (including Capital Stock) in which Liens are purported to be
granted pursuant to the Collateral Documents as security for the Secured
Obligations.

                  "Collateral Document" means the Pledge and Security
Agreement, the Mortgages, the Landlord Consent and Estoppel Agreements, if any,
and all other instruments, documents and agreements delivered by any Credit
Party pursuant to this Agreement or any of the other Credit Documents in order
to grant to Joint Collateral Agent, for the benefit of the Secured Parties, a
Lien on any real, personal or mixed property of that Credit Party as security
for the Secured Obligations.

                  "Credit Agreement" shall have the meaning given such term in
the introductory statement hereof.

                  "Credit Document" shall have the meaning given such term in
the Credit Agreement.

                  "Credit Party" shall mean the Company and each Guarantor.

                   "Directing Party" shall mean (i) until the First Priority
Termination Date, the Administrative Agent and (ii) at any time thereafter, so
long as any of the Rollover Notes remain Outstanding, the Rollover Note
Trustee.

                  "Event of Default" shall mean (i) at any time on or prior to
the First Priority Termination Date, an Event of Default as defined in the
Credit Agreement, and (ii) at any time after the First Priority Termination
Date, an Event of Default as defined in the Rollover Note Indenture.

                  "First Priority Obligations" shall mean the "Obligations" as
such term is defined in the Credit Agreement together with the Joint Collateral
Agent Fees, provided that at no time may the aggregate principal amount of the
First Priority Obligations exceed the amount of "Senior Indebtedness" as
permitted by and defined in the Rollover Note Indenture as of the date hereof
or as amended from time to time with the consent of Requisite Lenders as
defined in the Credit Agreement.

                  "First Priority Secured Parties" shall mean the Joint
Collateral Agent, the Agents, the Lenders and the Lender Counterparties and
shall include, without limitation, all former Lenders, Lender Counterparties,
Agents and Joint Collateral Agent to the extent that any First Priority
Obligations owing to such Persons were incurred while such Persons were
Lenders, Lender Counterparties, Agents (as such term is defined in the Credit
Agreement) or Joint Collateral Agent and such First Priority Obligations have
not been paid or satisfied in full.

                  "First Priority Termination Date" shall mean the last day to
occur of (i) the payment in full of all First Priority Obligations, (ii) the
cancellation or termination of all commitments under the Credit Agreement and
(iii) the cancellation or expiration of all outstanding Letters of Credit.

                                       3
<PAGE>

                  "Guarantors" shall have the meaning ascribed to such term in
the Credit Agreement.

                  "Joint Collateral Agent" shall have the meaning set forth in
the preamble.

                  "Joint Collateral Agent Fees" shall mean all fees, costs,
indemnification and expenses of the Joint Collateral Agent of the types
described in Sections 15 and 16 hereof.

                   "Landlord Consent and Estoppel Agreement" shall have the
meaning ascribed to such term in the Credit Agreement.

                  "Lien" means (i) any lien, mortgage, pledge, assignment,
security interest, charge or encumbrance of any kind (including any agreement
to give any of the foregoing, any conditional sale or other title retention
agreement, and any lease in the nature thereof) and any option, trust or other
preferential arrangement having the practical effect of any of the foregoing
and (ii) in the case of Securities, any purchase option, call or similar right
of a third party with respect to such Securities.

                  "Lenders" shall mean, collectively, the lenders set forth on
the signature pages to the Credit Agreement and their respective successors and
assigns.

                  "Lender Counterparties" shall have the meaning given such
term in the Credit Agreement.

                  "Lender Notes" shall mean "Notes" as such term is defined in
the Credit Agreement.

                  "Loans" shall have the meaning ascribed thereto in the Credit
Agreement.

                  "Mortgage" shall mean a Mortgage, Security Agreement,
Assignment of Rents and Leases and Fixture Filing, Open End Mortgage, Deed of
Trust, Trust Deed, Deed to Secure Debt, Credit Line Deed of Trust, Indemnity
Deed of Trust or similar or equivalent instrument secured by real property,
executed by the applicable Credit Party in favor of the Joint Collateral Agent,
as such document may be amended, supplemented, or otherwise modified from time
to time.

                   "Outstanding" shall mean, when used with respect to the
Secured Obligations, any Secured Obligations then or theretofore issued or
incurred by any Credit Party, including without limitation, an uncancelled
commitment under the Credit Agreement and any obligation under the Credit
Agreement to provide cash collateral in respect of outstanding letters of
credit or drafts drawn thereunder.

                  "Person" shall mean any natural person, corporation,
partnership, trust, joint venture, association, company, estate, business
entity, unincorporated organization or government or any agency or political
subdivision thereof.

                                       4
<PAGE>

                  "Pledge and Security Agreement" means that certain Pledge and
Security Agreement of even date herewith executed by each Guarantor and the
Company in favor of the Joint Collateral Agent, as it may be amended,
supplemented or otherwise modified from time to time.

                  "Proceeding" means any and each of (i) any insolvency or
bankruptcy case or proceeding, or any receivership, liquidation, reorganization
or other similar case or proceeding in connection therewith, relative to the
Credit Party or its assets, (ii) any liquidation, dissolution or other winding
up of the Credit Party, whether voluntary or involuntary involving insolvency
or bankruptcy or (iii) any assignment for the benefit of creditors or any other
marshaling of assets or liabilities of the Credit Party.

                  "Real Estate Assets" shall have the meaning given to such
term in the Credit Agreement.

                  "Responsible Officer" shall mean, with respect to the Company
or any other Credit Party, the president, vice president, chief financial
officer, chief accounting officer, secretary, treasurer or the general partner
or managing partner of such entity (or of the general partner or managing
partner of such entity, if not a natural person), as the case may be.

                   "Rollover Note Indenture" shall have the meaning given to
such term in the introductory statement hereof.

                  "Rollover Note Trustee" shall have the meaning set forth in
the preamble.

                  "Rollover Noteholders" shall mean those entities from time to
time holding Rollover Notes.

                  "Rollover Notes" shall have the meaning given to such term in
the introductory statement hereof.

                  "Second Priority Obligations" shall mean all obligations of
any nature of any Guarantor or the Company from time to time owed to the
Rollover Note Trustee or to any Rollover Noteholder under any Rollover Note or
the Rollover Note Indenture, whether for principal, premium, if any, or
interest (including interest which, but for the filing of a petition in
bankruptcy with respect to the Company or any Guarantor (as the case may be),
would have accrued on any Second Priority Obligation, whether or not a claim is
allowed against the Company or any Guarantor (as the case may be) for such
interest in the related bankruptcy proceeding) fees, expenses, indemnification
or otherwise together with the Joint Collateral Agent Fees.

                  "Second Priority Secured Parties" shall mean the Joint
Collateral Agent, the Rollover Noteholders and the Rollover Note Trustee.

                  "Secured Documents" shall mean (i) the Credit Agreement and
the Lender Notes if any and (ii) the Rollover Note Indenture and Rollover
Notes.

                                       5
<PAGE>

                  "Secured Obligations" shall mean, collectively, the First
Priority Obligations and the Second Priority Obligations.

                  "Secured Parties" shall mean collectively, the First Priority
Secured Parties and the Second Priority Secured Parties.

                   "Subsidiary" means, with respect to any Person, any
corporation, partnership, limited liability company, association, joint venture
or other business entity of which more than 50% of the total voting power of
shares of stock or other ownership interests entitled (without regard to the
occurrence of any contingency) to vote in the election of the Person or Persons
(whether directors, managers, trustees or other Persons performing similar
functions) having the power to direct or cause the direction of the management
and policies thereof is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person or a combination thereof; provided, in determining the percentage of
ownership interests of any Person controlled by another Person, no ownership
interest in the nature of a "qualifying share" of the former Person shall be
deemed to be outstanding.

                  The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and section and
subsection references are of this Agreement unless otherwise specified.

                  Section 2.        Appointment As Joint Collateral Agent.

                           (a)      The Administrative Agent has been appointed
to act as agent hereunder for the Lenders and Lender Counterparties pursuant to
the Credit Agreement. The Rollover Note Trustee has been appointed to act as
agent hereunder for the Rollover Noteholders pursuant to the Rollover Note
Indenture. The Administrative Agent on behalf of the Lenders, and the Rollover
Note Trustee on behalf of the Rollover Noteholders, hereby appoint and
authorize the Joint Collateral Agent to act as their agent in entering into the
Collateral Documents, enforcing their respective rights in respect of the
Collateral and administering the Collateral in accordance with the terms and
provisions of this Agreement.

                           (b)      The Joint Collateral Agent may exercise the
rights and remedies provided in this Agreement and in the Collateral Documents
in accordance at all times with the directions of the Directing Party as
provided herein and therein. In exercising rights and remedies with respect to
the Collateral, the Joint Collateral Agent at the direction of the Directing
Party shall enforce the provisions of the Collateral Documents and exercise
remedies thereunder, all in such order and in such manner as they may in their
sole discretion determine. Such exercise and enforcement shall include, without
limitation, the rights of an agent appointed by them to sell or otherwise
dispose of Collateral upon foreclosure, to incur expenses in connection with
such sale or disposition, and to exercise all the rights and remedies of a
secured lender under the UCC (as such term is defined in the Credit Agreement)
of any applicable jurisdiction and of a secured creditor under bankruptcy or
similar laws of any applicable jurisdiction.

                                       6
<PAGE>

                           (c)      The Joint Collateral Agent appointment
hereunder is subject to the following provisions and conditions:

                                    (i)      all rights, powers, duties and
         obligations conferred upon the Joint Collateral Agent in respect of
         the custody, control and management of moneys, papers or securities
         shall be exercised solely by the Joint Collateral Agent upon the
         directions of the Directing Party (which, at anytime, if requested by
         the Joint Collateral Agent shall henceforth be in writing executed and
         delivered by the Directing Party to the Joint Collateral Agent);

                                    (ii)     all rights, powers, duties and
         obligations conferred or imposed upon the Joint Collateral Agent
         hereunder and under the Collateral Documents shall be conferred or
         imposed and exercised or performed by the Joint Collateral Agent upon
         the directions of the Directing Party (which, at anytime, if requested
         by the Joint Collateral Agent shall henceforth be in writing executed
         and delivered by the Directing Party to the Joint Collateral Agent);

                                    (iii)    no power given hereby or by any of
         the Collateral Documents to the Joint Collateral Agent shall be
         exercised hereunder or thereunder by the Joint Collateral Agent except
         with the consent of the Directing Party (which, at any time, if
         requested by the Joint Collateral Agent shall henceforth be in writing
         executed and delivered by the Directing Party to the Joint Collateral
         Agent), anything contained herein to the contrary notwithstanding;

                                    (iv)     the Joint Collateral Agent shall
         not be personally liable by reason of any act or omission of any
         Directing Party or any act or omission of the Joint Collateral Agent
         acting or not acting in accordance with directions of any Directing
         Party; and

                                    (v)      at all times that the Directing
         Party is the Administrative Agent, the Directing Party shall provide
         to the Rollover Note Trustee a copy, extract or summary of any written
         direction, request or instruction given by it to the Joint Collateral
         Agent (in such capacity only) at the same time as such direction,
         request or instruction is delivered to the Joint Collateral Agent.

                           (d)      Notwithstanding the generality of Section
2(c) above, the Directing Party shall have the right, by instrument in writing
executed and delivered to the Joint Collateral Agent (unless such requirement
is waived by the Joint Collateral Agent in its sole discretion), to direct the
time, method and place of conducting any proceeding for any right or remedy
available to the Joint Collateral Agent, or of exercising any trust or power
conferred on the Joint Collateral Agent, or the appointment of a receiver, or
to direct the taking or the refraining from taking of any action authorized by
this Agreement or the Collateral Documents; provided, that such direction shall
not

                                       7
<PAGE>

conflict with the provisions of any law or of this Agreement or the Collateral
Documents. In the absence of such direction, the Joint Collateral Agent shall
have no duty to take or refrain from taking any action unless explicitly
required herein.

                           (e)      The Joint Collateral Agent may at any time
request directions from the Directing Party as to any course of action or other
matter relating hereto. Directions given by the Directing Party hereunder that
are consistent with the rights of the Secured Parties under the Secured
Documents shall be binding on all Secured Parties and their successors and
assigns for all purposes and the Joint Collateral Agent shall not be liable to
any party by reason of the Joint Collateral Agent acting (or not acting) in
accordance with any directions given by the Directing Party.

                           (f)      So long as the First Priority Obligations
are Outstanding, (i) the parties hereto agree that, after the date hereof, if
the Rollover Note Trustee shall hold any Lien on any assets of Company or any
of its Subsidiaries securing the Second Priority Obligations, the Rollover Note
Trustee, upon demand by the Joint Collateral Agent, shall assign it to the
Joint Collateral Agent as security for the Secured Obligations, or if such
assignment is not possible, shall subordinate such lien to the satisfaction of
Joint Collateral Agent acting on instructions of the Directing Party or shall
release such lien and (ii) the Company agrees not to grant any Lien on any of
its assets, or permit any Subsidiary of the Company to grant a Lien on any of
its assets, in favor of the Rollover Noteholders other than to the Joint
Collateral Agent as security for the Secured Obligations pursuant to the
Collateral Documents.

                           (g)      So long as the Second Priority Obligations
are Outstanding, (i) the parties hereto agree that, after the date hereof, if
the Administrative Agent shall hold any Lien on any assets of the Company or
any of its Subsidiaries securing the First Priority Obligations (other than in
respect of the Cash Collateral Accounts (as defined in the Credit Agreement as
of the date hereof)), the Administrative Agent, upon demand by the Joint
Collateral Agent shall assign it to the Joint Collateral Agent as security for
the Secured Obligations, or if such assignment is not possible, shall
subordinate such lien to the satisfaction of Joint Collateral Agent acting on
instructions of the Directing Party or shall release such lien and (ii) the
Company agrees not to grant any Lien on any of its assets, or permit any
Subsidiary of the Company to grant a Lien on any of its assets (other than the
Cash Collateral Accounts), in favor of the Lenders other than to the Joint
Collateral Agent as security for the Secured Obligations pursuant to the
Collateral Documents.

                           (h)      So long as the First Priority Obligations
are Outstanding, whether or not any Proceeding has been commenced by or against
any Credit Party, (i) the Rollover Note Trustee and the Rollover Noteholders
will not exercise or seek to exercise any rights or remedies (including setoff)
solely with respect to any Collateral, institute any action or proceeding with
respect to such rights or remedies, including, without limitation, any action
of foreclosure, contest, protest or object to any foreclosure proceeding or
action brought by the Joint Collateral Agent, or any other exercise by any such
party, of any rights and remedies relating to the Collateral under the
Collateral Documents or otherwise, or object to the forbearance by the Lenders,
Administrative

                                       8
<PAGE>

Agent or Joint Collateral Agent from bringing or pursuing any foreclosure
proceeding or action or any other exercise of any rights or remedies relating
to the Collateral and (ii) the Joint Collateral Agent shall have the exclusive
right to enforce rights, exercise remedies (including, without limitation,
setoff and the right to credit bid their debt) and make determinations
regarding release, disposition, or restrictions with respect to the Collateral
without any consultation with or the consent of the Rollover Note Trustee or
any Rollover Noteholder; provided, however, that (without prejudice to any
other rights the Rollover Note Trustee may have) in any Proceeding commenced by
or against any Credit Party, the Rollover Note Trustee may file a claim or
statement of interest with respect to the Second Priority Obligations.

                           (i)      The Rollover Note Trustee, on behalf of
itself and the Rollover Noteholders, agrees that it will not take or receive
any Collateral or any proceeds of Collateral in connection with the exercise of
any right or remedy (including setoff) with respect to any Collateral, for so
long as the First Priority Obligations are Outstanding. Without limiting the
generality of the foregoing, for so long as the First Priority Obligations are
Outstanding, except as expressly provided in the proviso in Section 2(h) above,
the sole right of the Rollover Note Trustee and the Rollover Noteholders with
respect to the Collateral is to be a silent beneficiary of the Lien on the
Collateral granted to the Joint Collateral Agent pursuant to the Collateral
Documents for the period and to the extent granted therein and to receive a
share of the proceeds thereof, if any, after the First Priority Obligations
have been indefeasibly paid in full and are no longer Outstanding.

                           (j)      Any Collateral or proceeds thereof received
by the Administrative Agent, the Rollover Note Trustee, any Lender or any
Rollover Noteholder in connection with the exercise of any right or remedy
(including setoff) relating to the Collateral in contravention of this
Agreement shall be segregated and held in trust and forthwith paid over to the
Joint Collateral Agent for application in accordance with the terms of this
Agreement in the same form as received, with any necessary endorsements or as a
court of competent jurisdiction may otherwise direct. The Joint Collateral
Agent is hereby authorized to make any such endorsements as agent for
Administrative Agent, the Rollover Note Trustee or any such Lender or Rollover
Noteholder. This authorization is coupled with an interest and is irrevocable.

                           (k)      The Joint Collateral Agent shall have the
sole and exclusive right, under the circumstances provided in Section 5.5(a) of
the Credit Agreement and Section 6.1(a) of the Pledge and Security Agreement
(and subject to the express rights of the Credit Party thereunder), to adjust
settlement for any insurance policy covering the Collateral in the event of any
loss thereunder and to approve any award granted in any condemnation or similar
proceeding affecting the Collateral. All proceeds of any such policy and any
such award shall be paid to the Joint Collateral Agent for distribution in
accordance with Section 8 hereof. If the Administrative Agent, the Rollover
Note Trustee, any Lender or any Rollover Noteholder shall, at any time, receive
any proceeds of any such insurance policy or any such award in contravention of
this Agreement, it shall pay such proceeds over to the Joint Collateral Agent
in accordance with the terms of this Agreement.

                                       9
<PAGE>

                           (l)      To the maximum extent permitted by law,
each Second Priority Secured Party waives any claim it might have against the
First Priority Secured Parties with respect to, or arising out of or in
connection with, any action or failure to act or any error of judgment,
negligence, mistake or oversight whatsoever on the part of any First Priority
Secured Party or its directors, officers, employees, attorneys or agents with
respect to any exercise of rights or remedies under the Credit Documents, other
than any claims resulting from the gross negligence or willful misconduct of
any First Priority Secured Party. No First Priority Secured Party nor any of
its directors, officers, employees, attorneys or agents shall be (a) liable for
failure to demand, collect or realize upon any of the Collateral or for any
delay in doing so or (b) under any obligation to sell or otherwise dispose of
any Collateral upon the request of any Credit Party or any Second Priority
Secured Party or any other Person or to take any other action whatsoever with
regard to the Collateral or any part thereof. Without limiting the generality
of the foregoing, the Joint Collateral Agent shall not have any duty to the
Secured Parties with respect to the perfection of the liens and security
interests created pursuant to the Collateral Documents and the maintenance of
the validity, effectiveness and priority thereof other than to act in
accordance with the written direction of the Directing Party with respect to
the same.

                  Section 3.        Remedies Not Exclusive. (a) No remedy
conferred upon or reserved to the Joint Collateral Agent or Directing Party
herein or in the Secured Documents or the Collateral Documents is intended to
be exclusive of any other remedy or remedies, but every such remedy shall be
cumulative and shall be in addition to every other remedy conferred herein or
in the Secured Documents or the Collateral Documents or now or hereafter
existing at law or in equity or by statute.

                           (b)      No delay or omission by the Joint
Collateral Agent or Directing Party to exercise any right, remedy or power
hereunder or under the Collateral Documents shall impair any such right, remedy
or power or shall be construed to be a waiver thereof or an acquiescence
therein, and every right, power and remedy given by this Agreement or the
Collateral Documents to the Joint Collateral Agent or Directing Party may be
exercised from time to time and as often as may be deemed expedient by the
Joint Collateral Agent or Directing Party.

                           (c)      If the Joint Collateral Agent shall have
proceeded to enforce any right, remedy or power under this Agreement or the
Collateral Documents and the proceeding for the enforcement thereof shall have
been discontinued or abandoned for any reason or shall have been determined
adversely to the Joint Collateral Agent, then the Credit Parties, the Joint
Collateral Agent and the Secured Parties shall, subject to any determination in
such proceeding, severally and respectively be restored to their former
positions and rights hereunder and under the Collateral Documents with respect
to the Collateral and in all other respects, and thereafter all rights,
remedies and powers of the Joint Collateral Agent and Directing Party shall
continue as though no such proceeding had been taken.

                           (d)      All rights of action and of asserting
claims upon or under this Agreement and the Collateral Documents may be
enforced by the Joint Collateral Agent

                                      10
<PAGE>

without the possession of the Collateral Documents or any instrument evidencing
any Secured Obligation or the production thereof at any trial or other
proceeding relative thereto, and any suit or proceeding instituted by the Joint
Collateral Agent shall be, subject to Section 11 hereof, brought in its name as
Joint Collateral Agent and any recovery of a judgment shall be held as part of
the Collateral.

                  Section 4.        Waiver and Estoppel. (a) The Company on
behalf of the Credit Parties agrees, to the extent it may lawfully do so, that
it will not, at any time in any manner whatsoever, claim or take the benefit or
advantage of any appraisement, valuation, stay, extension, moratorium, turnover
or redemption law, or any law permitting it to direct the order in which the
Collateral shall be sold, now or at any time hereafter in force, which may
delay, prevent or otherwise affect the performance or enforcement of this
Agreement or the Collateral Documents and hereby waives all benefit or
advantage of all such laws and covenants that it will not hinder, delay or
impede the execution of any power granted to the Joint Collateral Agent or
Directing Party in this Agreement or the Collateral Documents but will suffer
and permit the execution of every such power as though no such law were in
force.

                           (b)      Each of the Company on behalf of the Credit
Parties, the Administrative Agent on behalf of the Lenders and the Rollover
Note Trustee on behalf of the Rollover Noteholders waives and releases, to the
extent it may lawfully do so, on behalf of itself and all who claim through or
under it, including without limitation, any and all subsequent creditors,
vendees, assignees and lienors, all rights to demand or to have any marshaling
of the Collateral upon any sale, whether made under any power of sale granted
herein or in the Collateral Documents or pursuant to judicial proceedings or
upon foreclosure or any enforcement of this Agreement or the Collateral
Documents and consents and agrees that all the Collateral may at any such sale
be offered and sold as an entirety.

                           (c)      Each of the Company on behalf of the Credit
Parties, the Administrative Agent on behalf of the Lenders and the Rollover
Note Trustee on behalf of the Rollover Noteholders waives any rights, to the
extent permitted by applicable law, to presentment, demand, protest and any
notice of any kind (except notices explicitly required hereunder or under the
Secured Documents or the Collateral Documents) in connection with this
Agreement and the Collateral Documents and any action taken by the Joint
Collateral Agent with respect to the Collateral.

                  Section 5.        Limitation on Joint Collateral Agent's Duty
in Respect of Collateral. Beyond its duties as to the custody thereof expressly
provided herein or in the Collateral Documents and to account to the Secured
Parties and the Credit Parties for moneys and other property received by it
hereunder or under the Collateral Documents, the Joint Collateral Agent shall
not have any duty to the Credit Parties or to the Secured Parties as to any
Collateral in the possession or control of any of its agents or nominees, or
any income thereon or as to the preservation of rights against prior parties or
any other rights pertaining thereto.

                                      11
<PAGE>

                  Section 6.        Limitation by Law. All rights, remedies,
powers and waivers provided by this Agreement may be exercised only to the
extent that the exercise thereof does not violate any applicable provision of
law, and all the provisions hereof are intended to be subject to all applicable
mandatory provisions of law which may be controlling and to be limited by the
extent necessary so that they will not render this Agreement, the Secured
Documents or any Collateral Document invalid, unenforceable in whole or in part
or not entitled to be recorded, registered or filed under provisions of any
applicable law.

                  Section 7.        Rights of Secured Parties under Secured
Documents. Notwithstanding any other provision of this Agreement or the
Collateral Documents, as between each Secured Party on the one hand and the
Company on the other hand, the right of such Secured Party to receive payment
of the Secured Obligations held by such Secured Party when due (whether at the
stated maturity thereof, by acceleration or otherwise) as expressed in the
related Secured Document or other instrument evidencing, or agreement
governing, a Secured Obligation, and to institute suit against any Credit Party
for the enforcement of such payment on or after such due date, and the
obligation of the Credit Parties to pay such Secured Obligation when due, shall
not be impaired or affected by this Agreement. It is acknowledged and agreed by
all parties hereto that notwithstanding any provision or implication to the
contrary herein, the Second Priority Obligations are not subordinated in right
of payment to the First Priority Obligations.

                  Section 8.        Distributions

                           (a)      All proceeds of Collateral held or received
by the Joint Collateral Agent shall, to the extent available for distribution
at any time (it being understood that the Joint Collateral Agent may liquidate
investments prior to maturity in order to make a distribution pursuant to this
Section 8), be distributed by the Joint Collateral Agent in the following order
of priority:

                  First: to the Joint Collateral Agent for any unpaid Joint
Collateral Agent Fees; provided, however, that nothing herein is intended to
relieve the Company of its obligations to pay such costs, fees, expenses or
liabilities from funds other than funds representing proceeds of the
Collateral;

                  Second: to the Administrative Agent, in an amount equal to
all reasonable costs, expenses and disbursements of the Administrative Agent;

                  Third: to the Administrative Agent, in an amount equal to the
unpaid amount of all other First Priority Obligations then Outstanding in such
order of priority as may be provided in the Credit Agreement;

                  Fourth: to the Rollover Note Trustee, in an amount equal to
all reasonable costs, expenses and disbursements of the Rollover Note Trustee;

                                      12
<PAGE>

                  Fifth: to the Rollover Note Trustee, in an amount equal to
the unpaid amount of Second Priority Obligations then Outstanding in such order
of priority as may be provided in the Rollover Note Indenture; and

                  Sixth: any surplus then remaining shall be paid to the
Company or its successors or assigns or to whomsoever may be lawfully entitled
to receive the same or as a court of competent jurisdiction may direct.

                           (b)      The Joint Collateral Agent shall make all
payments and distributions under this Section 8: (i) on account of First
Priority Obligations, to the Administrative Agent for redistribution in
accordance with the provisions of the Credit Agreement and (ii) on account of
the Second Priority Obligations, to the Rollover Note Trustee for
redistribution in accordance with the provisions of the Rollover Note
Indenture.

                           (c)      In making the determinations and
allocations required by Section 8(a) hereof, the Joint Collateral Agent may
rely upon information supplied by the Administrative Agent as to the amounts
payable with respect to First Priority Obligations and upon information
supplied by the Rollover Note Trustee as to the amounts payable with respect to
the Second Priority Obligations, and the Joint Collateral Agent shall have no
liability to the Credit Parties or any of the Secured Parties for actions taken
in reliance on such information. The Joint Collateral Agent shall supply copies
of such information to the Company promptly upon receipt thereof. All
distributions made by the Joint Collateral Agent pursuant to Section 8(a)
hereof shall be (subject to any decree of any court of competent jurisdiction)
final, and the Joint Collateral Agent shall have no duty to inquire as to the
application by the Administrative Agent or the Rollover Note Trustee of any
amounts distributed to them.

                           (d)      If, through the operation of any
bankruptcy, reorganization, insolvency or other laws or otherwise, the Joint
Collateral Agent's security interest under any of the Collateral Documents is
enforced with respect to some, but not all, of the Secured Obligations then
Outstanding, the Joint Collateral Agent shall nonetheless apply the proceeds of
the Collateral for the benefit of the Secured Parties in the proportions and
subject to the priorities specified herein.

                  Section 9.        Delegation of Duties. The Joint Collateral
Agent may execute any of the powers hereof and perform any duty hereunder
either directly or by or through agents or attorneys-in-fact, who may include
officers and employees of the Company; provided, that the Joint Collateral
Agent shall so execute and perform any such duty by or through such Person
(including, prior to the First Priority Termination Date, the Administrative
Agent and thereafter, so long as any of the Rollover Notes are then
outstanding, the Rollover Note Trustee) as the Directing Party may direct. The
Joint Collateral Agent shall be entitled to the advice of counsel selected by
the Directing Party concerning all matters pertaining to such powers and
duties. The Joint Collateral Agent shall not be responsible for the negligence
or misconduct of any agents or attorneys-in-fact selected by it without bad
faith, gross negligence or willful misconduct.

                                      13
<PAGE>

                  Section 10.       Reliance by Joint Collateral Agent. (a)
Whenever in the administration of this Agreement or the Collateral Documents
the Joint Collateral Agent shall deem it necessary or desirable that a factual
matter be proved or established in connection with the Joint Collateral Agent
taking, suffering or omitting any action hereunder, such matter (unless other
evidence in respect thereof is herein specifically prescribed) may be deemed to
be conclusively proved or established by a certificate of an Authorized Officer
of the Company delivered to the Joint Collateral Agent, and such certificate
shall be full warranty to the Joint Collateral Agent for any action taken,
suffered or omitted in reliance thereon in compliance with the Agreement and
any Secured Document, subject, however, to the provisions of Section 11 hereof.

                           (b)      Irrespective of any direction from the
Directing Party, the Joint Collateral Agent may consult with counsel,
accountants, or other experts, and any opinion of counsel or opinion of
accountants or other experts shall be full and complete authorization and
protection in respect of any action taken or suffered by it hereunder or under
the Collateral Documents in accordance therewith. The Joint Collateral Agent
shall have the right at any time to seek instructions concerning the
administration of this Agreement and the Secured Documents from any court of
competent jurisdiction.

                           (c)      The Joint Collateral Agent may rely, and
shall be fully protected in acting, upon any resolution, statement,
certificate, instrument, opinion, report, notice, request, consent, order, bond
or other paper or document which it has no reason to believe to be other than
genuine and to have been signed or presented by the proper party or parties or,
in the case of cables, telecopies and telexes, to have been sent by the proper
party or parties. In the absence of its gross negligence or willful misconduct,
the Joint Collateral Agent may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Joint Collateral Agent and conforming
to the requirements of this Agreement or the Collateral Documents.

                           (d)      Irrespective of any direction from the
Directing Party, the Joint Collateral Agent shall not be under any obligation
to exercise any of the rights or powers vested in the Joint Collateral Agent by
this Agreement (including, without limitation, Section 8(a) or 11(b) hereof)
and the Collateral Documents unless the Joint Collateral Agent shall have been
provided adequate security and indemnity against the costs, expenses and
liabilities that may be incurred by it in connection therewith, including such
reasonable advances as may be requested by the Joint Collateral Agent.

                           (e)      Upon any application or demand by the
Company to the Joint Collateral Agent to take or permit any action under any of
the provisions of this Agreement or the Collateral Documents, the Joint
Collateral Agent may require that the Company furnish to the Joint Collateral
Agent a certificate of an Authorized Officer stating that all conditions
precedent, if any, provided for in this Agreement, the Secured Documents or in
the Collateral Documents relating to the proposed application or demand have
been satisfied.

                                      14
<PAGE>

                           (f)      In any case in which the Joint Collateral
Agent shall be required or permitted to determine whether any proceeds of the
sale or other disposition of any property shall be proceeds of Collateral, or
otherwise to make any determination as to the extent to which the Collateral
Documents secures any Secured Obligations, the Joint Collateral Agent is
authorized, at the cost and expense of the Company and without any direction
from, or requirements for consent of or authorization by any Secured Party to
institute proceedings in a court of competent jurisdiction for the obtaining of
any authoritative determination of such matter. If the Joint Collateral Agent
institutes any such proceeding, it shall give prompt written notice thereof to
the Administrative Agent, the Rollover Note Trustee and the Company and shall
afford each of them the opportunity to participate in such proceeding.

                  Section 11.       Limitations and Duties of Joint Collateral
Agent. (a) The Joint Collateral Agent shall be obligated to perform such duties
and only such duties as are specifically set forth in this Agreement and the
Collateral Documents, and no implied covenants or obligations shall be read
into this Agreement or the Collateral Documents against the Joint Collateral
Agent. The Joint Collateral Agent shall exercise the rights and powers vested
in it by this Agreement and the Collateral Documents, and the Joint Collateral
Agent shall not be liable with respect to any action taken by it or omitted to
be taken by it, in accordance with the direction of the Directing Party.

                           (b)      Except as herein otherwise expressly
provided, the Joint Collateral Agent shall not be under any obligation to take
any action which is discretionary under the provisions hereof or of the
Collateral Documents except upon the written direction of the Directing Party.
Upon written request by the Administrative Agent or the Rollover Note Trustee,
the Joint Collateral Agent shall make available for inspection and copying by
the Administrative Agent or the Rollover Note Trustee, as applicable, each
certificate or other paper furnished to the Joint Collateral Agent by the
Company under or in respect of this Agreement, the Collateral Documents or the
Collateral.

                           (c)      No provision of this Agreement or of the
Collateral Documents shall be deemed to impose any duty or obligation on the
Joint Collateral Agent to perform any act or acts or exercise any right, power,
duty or obligation conferred or imposed on it in any jurisdiction in which it
shall be illegal, or in which the Joint Collateral Agent shall be legally
unqualified or incompetent, to perform any such act or acts or to exercise any
such right, power, duty or obligation or if such performance or exercise would
constitute doing business by the Joint Collateral Agent in such jurisdiction or
imposes a tax on the Joint Collateral Agent by reason thereof.

                  Section 12.       Moneys to be Held in Trust. All moneys
received by the Joint Collateral Agent under or pursuant to any provision of
this Agreement or the Collateral Documents (except Joint Collateral Agent Fees)
shall be held in trust for the purposes for which they were paid or are held.

                  Section 13.       Delivery of Secured Documents. On or before
the time of the making of the initial Credit Extensions pursuant to (and as
defined in) the Credit

                                      15
<PAGE>

Agreement, the Company shall deliver to Joint Collateral Agent true and
complete copies of all Collateral Documents as in effect at such time. The
Company shall deliver to the Joint Collateral Agent, promptly upon the
execution thereof, a true and complete copy of any amendment, modification or
supplement to any Collateral Document, entered into after such time.

                  Section 14.       Information as to the Secured Parties,
Administrative Agent and Rollover Noteholders. The Company shall promptly
deliver to the Joint Collateral Agent, from time to time upon request of the
Joint Collateral Agent, a list setting forth as of a date not more than 30 days
prior to the date of such delivery, (i) the amount and type of the Outstanding
First Priority Obligations (it being agreed that unless otherwise specifically
requested, in the case of such obligations in respect of Hedge Agreements (as
defined in the Credit Agreement), a good faith estimate shall suffice) and the
name and address of the Administrative Agent and (ii) the amount and type of
Outstanding Second Priority Obligations and the name and address of the
Rollover Note Trustee and the Rollover Noteholders.

                  Section 15.       Compensation; Expenses. The Company agrees
to pay to the Joint Collateral Agent, from time to time upon demand, (i)
reasonable compensation (which shall not be limited by any provision of law in
regard to compensation of fiduciaries or of a trustee of an express trust) for
its services hereunder and under the Collateral Documents and for administering
the Collateral as set forth in the Credit Documents and the Rollover Note
Indenture and as separately agreed in writing between the Joint Collateral
Agent and the Company and (ii) all of the reasonable fees, costs and expenses
of the Joint Collateral Agent (including, without limitation, any reasonable
and documented fees and disbursements of its counsel and such special counsel,
accountants or other experts as the Joint Collateral Agent may elect to retain
in the exercise of its reasonable judgment) (A) arising in connection with the
preparation, execution, delivery, modification, restatement, amendment or
termination of this Agreement and the Collateral Documents or the enforcement
of any of the provisions hereof or thereof or the exercise of any rights
hereunder or thereunder or (B) incurred or required to be advanced in
connection with the administration of the Collateral, the sale or other
disposition or the custody or release of Collateral pursuant to the Collateral
Documents and the preservation, protection or defense of the Joint Collateral
Agent's rights under this Agreement and the Collateral Documents and in and to
the Collateral.

                  Section 16.       Indemnification. The Company agrees to pay,
indemnify, and hold the Joint Collateral Agent harmless from and against any
and all liabilities, obligations, losses, damages, penalties, actions,
judgments, suits, costs or expenses (including without limitation or
duplication, the reasonable and documented fees and disbursements of counsel)
incurred by the Joint Collateral Agent with respect to the execution, delivery,
enforcement, performance and administration of this Agreement and the
Collateral Documents, unless arising from the gross negligence or willful
misconduct of the Joint Collateral Agent (including, without limitation,
indemnification of the Joint

                                      16
<PAGE>

Collateral Agent for liabilities of the Joint Collateral Agent for the net
amount of taxes (after taking account of any deduction, credit or other tax
reduction or benefit available by reason of the imposition of any such tax) in
any jurisdiction in which the Joint Collateral Agent would not otherwise be
subject to tax except by reason of its acting under this Agreement or the
Collateral Documents (directly or through agents); provided, that such
indemnification for taxes (a) shall apply only (i) in respect of taxes
attributable to the performance of the Joint Collateral Agent's obligations as
Joint Collateral Agent hereunder and (ii) to the extent that the Joint
Collateral Agent, using reasonable efforts, shall have been unable to avoid or
minimize the same as contemplated by Section 18 hereof and (b) shall in no
event cover any federal, state, local or other taxes imposed upon the Joint
Collateral Agent with respect to or measured by its net income or profits. In
any suit, proceeding or action brought by the Joint Collateral Agent under or
with respect to any contract, agreement, interest or obligation constituting
part of the Collateral for any sum owing thereunder, or to enforce any
provisions thereof or of any of the Collateral Documents or this Agreement, the
Company will save, indemnify and keep the Joint Collateral Agent harmless from
and against all expense, loss or damage suffered by reason of any defense,
setoff, counterclaim, recoupment or reduction of liability whatsoever of the
obligor thereunder, arising out of a breach by any Credit Party of any
obligation thereunder or arising out of any other agreement, indebtedness or
liability at any time owing to or in favor of such obligee or its successors
from such Credit Party, and all such obligations of such Credit Party shall be
and remain enforceable against and only against such Credit Party and shall not
be enforceable against the Joint Collateral Agent.

                  Section 17.       Releases. (a) Sales or other dispositions
of Collateral which are not prohibited by the Credit Agreement and the Rollover
Note Indenture shall not require any written or oral release or consent of the
Joint Collateral Agent. Nevertheless, the Company shall be entitled to request
upon presentation of a certificate from the Company that a sale is being
consummated in accordance with the Credit Agreement and the Rollover Note
Indenture, that the Joint Collateral Agent (i) execute and deliver to the
Company or any purchaser of Collateral, a written release, termination,
disclaimer or quitclaim of the Joint Collateral Agent's interest in any
Collateral hereunder and under the Collateral Documents, and the Company or
such purchaser, as the case may be, shall be entitled to rely conclusively on
such release, termination, disclaimer or quitclaim and/or (ii) redeliver any
such Collateral then in the possession of the Joint Collateral Agent or any
agent or nominee thereof. Such request shall be in writing signed by an
Authorized Officer of the Company, shall describe the property to be released
in reasonable detail and shall state (with reference to applicable Sections of
the Credit Agreement and the Rollover Note Indenture) that such release is or
will be in accordance with the Credit Agreement and the Rollover Note
Indenture. The cancellation and satisfaction of all or any part of the Secured
Documents shall be without prejudice to the rights of the Joint Collateral
Agent to charge and be reimbursed for any expenditures which it may thereafter
incur in connection therewith and for which it is entitled to reimbursement
hereunder.

                           (b)      Sales or other dispositions of Collateral
which are prohibited by either the Credit Agreement or the Rollover Note
Indenture shall require the written consent of the Joint Collateral Agent. Such
consent shall be given by the Joint Collateral Agent (i) at the direction of
the Administrative Agent and/or such of the Lenders as may

                                      17
<PAGE>

be required under the Credit Agreement, if such sale or disposition is
permitted by the Rollover Note Indenture but not the Credit Agreement, (ii) at
the direction of the Rollover Note Trustee or Rollover Noteholders holding a
majority in principal amount of the Rollover Notes then Outstanding, if such
sale or disposition is permitted by the Credit Agreement but not the Rollover
Note Indenture and (iii) at the direction of both of the Administrative Agent
and/or such of the Lenders as may be required under the Credit Agreement, on
the one hand, and of the Rollover Note Trustee and/or such of the Rollover
Noteholders as may be required under the Rollover Note Indenture, on the other,
if such sale or disposition is prohibited by both the Credit Agreement and the
Rollover Note Indenture.

                           (c)      The notices, statements, directions and
certificates requested under or required by this Section 17 (together with any
required certificate of a Authorized Officer) shall be full authority for and
direction to the Joint Collateral Agent to execute and deliver the releases,
disclaimers, quitclaims and other instruments referred to in this Section 17.
The Joint Collateral Agent in so doing shall have no liability to any Person.

                  Section 18.       Exculpatory Provisions. (a) The Joint
Collateral Agent shall not be responsible in any manner whatsoever for any
recitals, statements, representations or warranties herein or in the Collateral
Documents, all of which are made solely by the Credit Parties or made in any
written or oral statements or in any financial or other statements,
instruments, reports or certificates or any other documents furnished or made
by any Joint Collateral Agent to any Secured Party or by or on behalf of any
Credit Party to any Secured Party in connection with the Secured Documents or
Collateral Documents and the transactions contemplated thereby or for the
financial condition or business affairs of any Credit Party or any other Person
liable for the payment of any Secured Obligations, nor shall the Joint
Collateral Agent be required to ascertain or inquire as to the performance or
observance of any of the terms, conditions, provisions, covenants or agreements
contained in any of the Secured Documents or Collateral Documents or as to the
existence or possible existence of any Event of Default or to make any
disclosures with respect to the foregoing. The Joint Collateral Agent makes no
representations as to the value or condition of the Collateral or any part
thereof, or as to the title of the Credit Parties thereto or as to the security
afforded by this Agreement or the Collateral Documents, or as to the
genuineness, validity, execution (except its own execution), effectiveness,
enforceability, legality, collectability or sufficiency of this Agreement, the
Collateral Documents or the Secured Obligations, and the Joint Collateral Agent
shall incur no liability or responsibility in respect of any such matters. The
Joint Collateral Agent shall not be responsible for insuring the Collateral or
for the payment of taxes, charges or assessments or discharging of liens upon
the Collateral or otherwise as to the maintenance of the Collateral, except
that if the Joint Collateral Agent takes possession of any Collateral, the
Joint Collateral Agent shall use reasonable care in the preservation of the
Collateral in its possession.

                           (b)      The Joint Collateral Agent shall not be
required to ascertain or inquire as to the performance by the Credit Parties of
any of the covenants or agreements contained herein, in the Collateral
Documents or in any Secured Document.

                                      18
<PAGE>

Whenever it is necessary, or in the reasonable opinion of the Joint Collateral
Agent advisable, for the Joint Collateral Agent to ascertain the amount of
Secured Obligations then held by Secured Parties, the Joint Collateral Agent
may rely on a certificate of the Rollover Note Trustee in the case of Second
Priority Obligations, or a certificate of the Administrative Agent in the case
of First Priority Obligations, and if the Rollover Note Trustee or the
Administrative Agent shall not give such information to the Joint Collateral
Agent, the Rollover Note Trustee or the Administrative Agent (as the case may
be) shall not be entitled to receive distributions hereunder.

                           (c)      The Joint Collateral Agent shall be under
no obligation or duty to take any action under this Agreement or the Collateral
Documents if taking such action (i) would subject the Joint Collateral Agent to
a tax in any jurisdiction where it is not then subject to a tax or would
require the Joint Collateral Agent to qualify to do business in any
jurisdiction where it is not then so qualified, unless the Joint Collateral
Agent receives security or indemnity satisfactory to it against such tax (or
equivalent liability), or any liability resulting from such qualification, in
each case that results from the taking of such action under this Agreement or
the Collateral Documents or (ii) would subject the Joint Collateral Agent to in
personam jurisdiction in any location where it is not then so subject.

                           (d)      Notwithstanding any other provision of this
Agreement, the Joint Collateral Agent shall not be personally liable for any
action taken or omitted to be taken by it in connection with this Agreement or
the Collateral Documents except for its own gross negligence or willful
misconduct.

                           (e)      The Joint Collateral Agent shall have the
same rights with respect to any Secured Obligation held by it as any other
Secured Party and may exercise such rights as though it were not the Joint
Collateral Agent hereunder, and may accept deposits from, lend money to and
generally engage in any kind of banking or trust business with the Credit
Parties as if it were not the Joint Collateral Agent.

                           (f)      Subject to the provisions of this Agreement
and the Collateral Documents concerning the Joint Collateral Agent's duty of
care with respect to Collateral in the Joint Collateral Agent's possession, the
Joint Collateral Agent shall not be personally liable for any acts, omissions,
errors of judgment or mistakes of fact or law made, taken or omitted to be made
or taken by it in connection with this Agreement or any Collateral Documents
(including, without limitation, acts, omissions, errors or mistakes with
respect to the Collateral including failure to take or to record or otherwise
perfect for any reason or for no reason any lien or security interest, exercise
or delay in or refrain from exercising any right or remedy against any Credit
Party or any Security or any Person) except for those arising out of or in
connection with the Joint Collateral Agent's gross negligence or willful
misconduct. Without prejudice to the generality of the foregoing, (i) the Joint
Collateral Agent shall be entitled to rely, and shall be fully protected in
relying, upon any communication, instrument or document believed by it to be
genuine and correct and to have been signed or sent by the proper Person or
Persons, and shall be entitled to rely and shall be protected in relying on
opinions and judgments of attorneys (who may be attorneys for any Credit
Party), accountants, experts and other

                                      19
<PAGE>

professional advisors selected by it; and (ii) no Secured Party shall have any
right of action whatsoever against the Joint Collateral Agent as a result of
the Joint Collateral Agent acting or (where so instructed) refraining from
acting hereunder or any of the other Collateral Documents in accordance with
the instructions of the Directing Party.

                  Section 19.       Resignation and Removal of the Joint
Collateral Agent. (a) The Joint Collateral Agent may at any time, by giving
written notice to the Company, the Administrative Agent and the Rollover Note
Trustee, resign and be discharged of the responsibilities hereby created, such
resignation to become effective upon (i) the appointment of a successor Joint
Collateral Agent (reasonably acceptable to the Rollover Note Trustee if at such
time the Directing Party is the Administrative Agent) by the Directing Party,
and (ii) the acceptance of such appointment by such successor Joint Collateral
Agent. If no successor Joint Collateral Agent shall be appointed and shall have
accepted such appointment within 45 days after the date the Joint Collateral
Agent gives the aforesaid notice of resignation, the Joint Collateral Agent may
apply to any court of competent jurisdiction to appoint a successor Joint
Collateral Agent to act until such time, if any, as a successor Joint
Collateral Agent shall have been appointed as provided in this Section 19. Any
successor so appointed by such court shall immediately and without further act
be superseded by any successor Joint Collateral Agent appointed by the
Directing Party. The Directing Party may, at any time, remove the Joint
Collateral Agent and appoint a successor Joint Collateral Agent (reasonably
acceptable to the Rollover Note Trustee if at such time the Directing Party is
the Administrative Agent), such removal to be effective upon the acceptance of
such appointment by the successor Joint Collateral Agent. Any resigning or
removed Joint Collateral Agent shall be entitled to Joint Collateral Agent Fees
to the extent incurred or arising, or relating to events occurring, before such
resignation or removal.

                           (b)      If at any time the Joint Collateral Agent
shall resign or be removed or otherwise become incapable of acting, or if at
any time a vacancy shall occur in the office of the Joint Collateral Agent for
any other cause, a successor Joint Collateral Agent (reasonably acceptable to
the Rollover Note Trustee if at such time the Directing Party is the
Administrative Agent) may be appointed by the Directing Party, and the powers,
duties, authority and title, of the predecessor Joint Collateral Agent shall be
terminated and canceled without procuring the resignation of such predecessor
and without any formality (except as may be required by applicable law) other
than appointment and designation of a successor by the Directing Party in
writing duly acknowledged and delivered to the predecessor and (if the
Directing Party is the Administrative Agent) the Rollover Note Trustee. Such
appointment and designation shall be full evidence of the right and authority
to make the same and of all the facts therein recited, and this Agreement and
the Collateral Documents shall vest in such successor, without any further act,
deed or conveyance, all the estates, properties, rights, powers, trusts,
duties, authority and title of its predecessor; but such predecessor shall,
nevertheless, on the written request of the Directing Party, the Credit Parties
or the successor Joint Collateral Agent execute and deliver an instrument
transferring to such successor all the estates, properties, rights, powers,
trusts, duties, authority and title of such predecessor hereunder and under the
Collateral Documents and shall deliver all

                                      20
<PAGE>

Collateral held by it or its agents to such successor Joint Collateral Agent.
Should any deed, conveyance or other instrument in writing from the Credit
Parties be required by any successor Joint Collateral Agent for more fully and
certainly vesting in such successor the estates, properties, rights, powers,
trusts, duties, authority and title vested or intended to be vested in the
predecessor Joint Collateral Agent, the Company agrees to procure that any and
all such deeds, conveyances and other instruments in writing shall, on request
of such successor, be executed, acknowledged and delivered by the Credit
Parties. If the Credit Parties shall not have executed and delivered any such
deed, conveyance or other instrument within 10 days after it received a written
request from the successor Joint Collateral Agent to do so, the predecessor
Joint Collateral Agent may execute the same on behalf of the Credit Parties.
The Company on behalf of the Credit Parties hereby appoints any predecessor
Joint Collateral Agent as their agent and attorney to act for them as provided
in the preceding sentence.

                  Section 20.       Status of Successor Joint Collateral Agent.
Every successor Joint Collateral Agent appointed pursuant to Section 19 hereof
shall be a bank or trust company in good standing and having power to act as
Joint Collateral Agent hereunder, shall be incorporated under the laws of the
United States of America or any State thereof or the District of Columbia and
having its principal corporate office within the 48 contiguous States and shall
also have capital, surplus and undivided profits of not less than $100,000,000,
provided that such conditions shall only apply if there be such an institution
with such capital, surplus and undivided profits willing, qualified and able to
accept the duties hereunder upon reasonable or customary terms.

                  Section 21.       Treatment of Payee or Endorsee by Joint
Collateral Agent; Representatives of Secured Parties

                           (a)      The Joint Collateral Agent may treat the
registered holder or, if none, the actual holder of any promissory note or
debenture evidencing a Secured Obligation as the absolute owner thereof for all
purposes and shall not be affected by any notice to the contrary, whether or
not such promissory note or debenture shall be past due.

                           (b)      Any Person (other than the Administrative
Agent or the Rollover Note Trustee), which shall be designated as the duly
authorized representative of one or more Secured Parties to act as such in
connection with any matters pertaining to this Agreement, the Collateral
Documents or the Collateral shall present to the Administrative Agent and the
Rollover Note Trustee (as the case may be) such documents as the Joint
Collateral Agent may reasonably require in order to demonstrate to the Joint
Collateral Agent the authority of such Person to act as the representative of
such Secured Party.

                  Section 22.       Notices. Unless otherwise specified herein,
all notices, requests, demands or other communications given to the Credit
Parties, the Joint Collateral Agent, the Administrative Agent or Rollover Note
Trustee shall be given in writing (including telecopy or similar writing) and
shall be addressed at its address specified on the signature pages hereof or
any other address designated by notice given in

                                      21
<PAGE>

accordance with this Section 22 to the party sending such communication. Each
such notice, request or other communication shall be effective and deemed
received (i) if given by telecopy, when such telecopy is transmitted to the
telecopy number specified on the signature pages hereof, (ii) if given by mail,
the third Business Day after such communication is deposited in the mail with
first class postage prepaid, addressed as aforesaid or (iii) if given by any
other means, when delivered at the address specified on the signature pages
hereof; provided, that any notice, request or demand to the Joint Collateral
Agent shall not be effective until actually received by the Joint Collateral
Agent at the office designated by it pursuant to this Section 22. In addition,
any notice to Rollover Noteholders shall be sufficiently given to them if given
to the Rollover Note Trustee and any notice to the Lenders shall be
sufficiently given to them if given to the Administrative Agent.

                  Section 23.       No Waivers. No failure on the part of the
Joint Collateral Agent, the Administrative Agent, the Rollover Note Trustee or
any Secured Party to exercise, no course of dealing with respect to and no
delay in exercising, any right, power or privilege under this Agreement or the
Collateral Documents shall operate as a waiver thereof nor shall any single or
partial exercise of any such right, power or privilege preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege. As between the Secured Parties, the provisions of this Agreement
shall continue in full force and effect notwithstanding the occurrence of any
Proceeding and all references herein to the Company and the Credit Parties
shall be deemed to include the Company and the Credit Parties in their capacity
as a debtor or debtor in possession in a Proceeding, all references herein to
First Priority Obligations and Second Priority Obligations of any Secured Party
shall be deemed to include any such obligations arising on or after the
commencement of any Proceeding, and all references herein to Collateral shall
be deemed to include any assets of any kind acquired by any Credit Party after
the commencement of a Proceeding.

                  Section 24.       Amendments, Supplements and Waivers. (a)
With the written consent of (i) the Administrative Agent and (ii) either the
Rollover Note Trustee and/or such Rollover Noteholders as may be required under
the Rollover Note Indenture, the Joint Collateral Agent and the Company may, at
any time and from time to time, enter into written agreements supplemental
hereto for the purpose of adding to or waiving any provision of this Agreement
or changing in any manner the rights of the Joint Collateral Agent, the Secured
Parties or the Credit Parties hereunder. Any such supplemental agreement shall
be binding upon the Credit Parties, the Administrative Agent, the Rollover Note
Trustee, the Secured Parties and the Joint Collateral Agent and their
respective successors.

                  Without the consent of the Secured Parties, the Joint
Collateral Agent and any of the Credit Parties may, at any time and from time
to time, enter into one or more additional Collateral Documents or one or more
agreements supplemental hereto or to the Collateral Documents, in form
satisfactory to the Joint Collateral Agent, (i) to add to the covenants of the
Credit Parties for the benefit of the Secured Parties or to surrender any right
or power herein conferred upon the Credit Parties, (ii) to mortgage to the
Joint Collateral Agent any property or assets as additional security for the
Secured Obligations,

                                      22
<PAGE>

or (iii) to cure any ambiguity, to correct or supplement any provision herein
or in the Collateral Documents which may be defective or inconsistent with any
other provision herein or therein, or to make any other provision with respect
to matters or questions arising hereunder which other provision shall not be
inconsistent with any provision hereof; provided, however, that any such action
contemplated by this clause (iii) shall not adversely affect the interests of
the first Priority Secured Parties or the Second Priority Secured Parties.

                  Section 25.       Termination. (a) The Rollover Note Trustee
shall notify the Joint Collateral Agent within 30 days after payment in full of
the Second Priority Obligations. Upon receipt by the Joint Collateral Agent of
satisfactory evidence that all the Second Priority Obligations have been paid,
all rights of the Rollover Note Trustee and each Rollover Noteholder hereunder
shall automatically terminate. At such time the Company agrees that it will
execute and deliver such amendments hereto, if any, as the Administrative Agent
shall request to reflect (i) that the only Secured Parties shall be the First
Priority Secured Parties and (ii) the Joint Collateral Agent shall at all times
act in accordance with the directions of the Administrative Agent acting in
accordance with the terms of the Credit Agreement.

(b)      The Administrative Agent shall notify the Joint Collateral Agent
within 30 days after payment in full of the First Priority Obligations. Upon
receipt by the Joint Collateral Agent of satisfactory evidence that all First
Priority Obligations have been paid, all rights of the Administrative Agent
hereunder shall automatically terminate. At such time, if the Second Priority
Obligations remain Outstanding, the Company agrees that it will execute and
deliver such amendments hereto, if any, as the Rollover Note Trustee shall
request to reflect (i) that the only Secured Parties shall be the Second
Priority Secured Parties and (ii) the Joint Collateral Agent shall at all times
act in accordance with the directions of the Rollover Note Trustee acting in
accordance with the terms of the Rollover Note Indenture. The Joint Collateral
Agent may at any time after the payment in full of the First Priority
Obligations, by giving written notice to the Company and the Rollover Note
Trustee, resign and be discharged of the responsibilities hereby created, such
resignation to become effective upon (i) the appointment of a successor Joint
Collateral Agent by the Directing Party and the acceptance of such appointment
by such successor Joint Collateral Agent or (ii) if no successor Joint
Collateral Agent shall be appointed and shall have accepted such appointment
within 45 days after the payment in full of the First Priority Obligations, the
Rollover Note Trustee shall become successor Joint Collateral Agent on such
45th day. Such resigning Joint Collateral Agent shall, on the written request
of the Directing Party or the successor Joint Collateral Agent, execute and
deliver an instrument transferring to such successor all the estates,
properties, rights, powers, trusts, duties, authority and title of such
resigning hereunder and under the Collateral Documents and shall deliver all
Collateral held by it or its agents to such successor Joint Collateral Agent.
Any resigning Joint Collateral Agent shall be entitled to Joint Collateral
Agent Fees to the extent incurred or arising, or relating to events occurring,
before such resignation or removal. The Rollover Note Trustee shall be entitled
to receive such compensation as shall be agreed upon in writing at such time
between the Rollover Note Trustee and the Company for its duties as

                                      23
<PAGE>

successor Joint Collateral Agent. The Rollover Note Trustee, in its capacity as
successor Joint Collateral Agent, shall be entitled to the rights, privileges,
immunities and benefits, including without limitation, the right to be
indemnified, found in the Indenture.

                  Section 26.       Headings. Headings of Sections and
subsections have been included herein and in the Collateral Documents for
convenience only and should not be considered in interpreting this Agreement or
the Collateral Documents.

                  Section 27.       Severability. Any provision of this
Agreement which is prohibited or unenforceable in any jurisdiction shall not
invalidate the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

                  Section 28.       Successors and Assigns. This Agreement
shall be binding upon and inure to the benefit of each of the parties hereto
and shall inure to the benefit of each of the Secured Parties and their
respective successors and assigns, and nothing herein is intended or shall be
construed to give any other Person any right, remedy or claim under, to or in
respect of this Agreement, the Collateral Documents or any Collateral.

                  Section 29.       Governing  Law. Except as otherwise
required by mandatory provisions of law, this Agreement shall be governed by
and construed in accordance with the laws of the State of New York.

                  Section 30.       Counterparts. This Agreement may be signed
in any number of counterparts with the same effect as if the signatures thereto
and hereto were upon the same instrument.

                  Section 31.       Interpleader. If at any time the Joint
Collateral Agent determines it to be appropriate, the Joint Collateral Agent
may commence an action in interpleader in order to obtain a judicial resolution
of the relevant issues which are in dispute. Such interpleader action shall be
brought in the courts of the State of New York unless the Joint Collateral
Agent is advised by independent counsel retained by the Joint Collateral Agent
that, due to the pendency of an action in another jurisdiction with respect to
which the Joint Collateral Agent is a party and which relates to this
Agreement, the Collateral Documents or the Collateral, such action should be
brought in such other jurisdiction.

                  Section 32.       Powers Coupled with an Interest. All
powers, authorizations and agencies contained in this Agreement are coupled
with an interest and are irrevocable until the Secured Obligations are paid in
full and the commitments under the Credit Agreement are terminated.

                  Section 33.       Company. Notwithstanding the Company's
execution and delivery of this Agreement, the Company shall be deemed to be a
party hereto solely for the express purposes and to the extent of its rights
and obligations under Sections 2(f)(ii), 13, 14, 15, 16, 17(a), 25(a) and (b)
(in each case, to the extent of the last sentence thereof), the sixth caption
in Section 8(a) (but only to the extent of its right to receive surplus
proceeds pursuant thereto) and Section 10 (but only to the extent of its
obligations to deliver the certificate of an Authorized Officer). Except as
expressly specified in the immediately preceding sentence, the Company and each
Credit Party shall have no rights, obligations or interests under this
Agreement.

                            [SIGNATURE PAGES FOLLOW]

                                      24
<PAGE>

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

                           RESIDENTIAL FUNDING CORPORATION dba GMAC-RFC
                           HEALTH CAPITAL, as Joint Collateral Agent

                           By /s/ Lorna Gleeson
                             --------------------------------------------------
                           Name:    Lorna Gleeson
                           Title:   Managing Director
                           Address:

                                      25
<PAGE>

                           UBS AG STAMFORD BRANCH, as Administrative Agent

                           By: /s/  Patricia O'Kicki
                             --------------------------------------------------
                           Name:    Patricia O'Kicki
                           Title:   Director
                           Address:

                                      26
<PAGE>

                           THE BANK OF NEW YORK, as Rollover Note Trustee

                           By /s/   Mary LaGumina
                             --------------------------------------------------
                           Name:    Mary LaGumina
                           Title:   Vice President
                           Address:

                                      27
<PAGE>

                           MARINER HEALTH CARE, INC., as the Company on
                           behalf of itself and the Credit Parties

                           By       /s/ Boyd Gentry
                             --------------------------------------------------
                           Name:    Boyd Gentry
                           Title:   Senior Vice President and Treasurer
                           Address:

                                      28

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