Document:

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                                                                    EXHIBIT 10.6

                           COLLATERAL TRUST AGREEMENT

            COLLATERAL TRUST AGREEMENT, dated as of April 30, 2001 (as amended,
amended and restated, supplemented or otherwise modified from time to time, this
"AGREEMENT"), among U.S. INDUSTRIES, INC. (formerly known as USI, Inc.), a
Delaware corporation ("USI"), USI GLOBAL CORP., a Delaware corporation ("USI
GLOBAL"), USI AMERICAN HOLDINGS, INC., a Delaware Corporation ("USI AMERICAN";
USI, USI Global and USI American are each referred to herein, individually, as a
"BORROWER", and, collectively, as the "BORROWERS"), each Subsidiary (as
hereinafter defined) of USI which is listed on the signature pages of this
Agreement (together with the Borrowers, each, individually, an "INITIAL
PLEDGOR", and, collectively, the "INITIAL Pledgors"), each Subsidiary of USI
which hereafter becomes a party to this Agreement pursuant to Section 9.15
hereof (together with the Initial Pledgors, each, individually, a "PLEDGOR" and,
collectively, the "PLEDGORS"), WILMINGTON TRUST COMPANY, a Delaware banking
corporation (together with any successor corporate trustee appointed pursuant to
Article 7, the "CORPORATE TRUSTEE"), and DAVID A. VANASKEY, an individual
residing in the State of Delaware (together with any successor individual
trustee appointed pursuant to Article 7, the "INDIVIDUAL TRUSTEE"; and, together
with the Corporate Trustee, the "COLLATERAL TRUSTEES"), the foregoing trustees
being trustees for the Secured Holders (as hereinafter defined). Certain
capitalized terms used herein are defined in Article 1 of this Agreement.

                             PRELIMINARY STATEMENTS:

            (1) The Borrowers have entered into (i) a Credit Agreement dated as
of December 12, 1996 (as amended, supplemented or otherwise modified and in
effect on the date hereof and as the same may hereafter be further amended,
amended and restated, supplemented or otherwise modified from time to time, the
"5-YEAR CREDIT AGREEMENT"), with the 5-Year Credit Parties (as hereinafter
defined), and (ii) a Credit Agreement dated as of October 27, 2000 (as amended,
supplemented or otherwise modified and in effect on the date hereof and as the
same may hereafter be further amended, amended and restated, supplemented or
otherwise modified from time to time, the "364-DAY CREDIT AGREEMENT"; and
together with the 5-Year Credit Agreement, collectively, the "CREDIT
AGREEMENTS"), with the 364-Day Credit Parties (as hereinafter defined). Each
Pledgor which is a subsidiary of a Borrower will directly or indirectly benefit
from the credit extended to such Borrower pursuant to the Credit Agreements.

            (2) Pursuant to the Credit Agreements, each Borrower has agreed (i)
to grant to the Collateral Trustees for the benefit of the Credit Parties and
the other Secured Holders pursuant to the Collateral Documents (as hereinafter
defined) liens on and security interests in certain of such Borrower's assets
and property from time to time owned by it and (ii) to cause its domestic
Subsidiaries to grant to the Collateral Trustees for the benefit of the Credit
Parties and the other Secured Holders pursuant to the Collateral Documents liens
on and security interests in certain of such Subsidiary's assets and property
from time to time owned by it.

            (3) USI, USI Global and USI American are joint and several
co-obligors with respect to those certain 7-1/4% Senior Notes due December 1,
2006 (as amended, supplemented or otherwise modified and in effect on the date
hereof and as the same may hereafter be further amended, modified, extended,
renewed, replaced, restated or supplemented from time to time pursuant to the
terms thereof, the "7-1/4% NOTES"), issued pursuant to that certain Indenture,
dated

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as of December 12, 1996 (as amended, supplemented or otherwise modified and in
effect on the date hereof and as the same may hereafter be further amended,
modified, extended, renewed, replaced, restated or supplemented from time to
time pursuant to the terms thereof, the "7-1/4% NOTES INDENTURE").

            (4) USI, USI Global and USI American are also joint and several
co-obligors with respect to those certain 7-?% Senior Notes due October 15,
2003 (as amended, supplemented or otherwise modified and in effect on the
date hereof and as the same may hereafter be further amended, modified,
extended, renewed, replaced, restated or supplemented from time to time
pursuant to the terms thereof, the "7-1/8% NOTES"), issued pursuant to that
certain Indenture, dated as of October 27, 1998 (as amended, supplemented or
otherwise modified and in effect on the date hereof and as the same may
hereafter be further amended, modified, extended, renewed, replaced,
restated, or supplemented from time to time pursuant to the terms thereof,
the "7-1/8% NOTES INDENTURE").

            (5) USI and USI Global have also previously entered into a
Guaranty dated as of March 24, 2000 (as amended, supplemented or otherwise
modified and in effect on the date hereof and as the same may hereafter be
further amended, amended and restated, supplemented or otherwise modified
from time to time pursuant to the terms thereof, the "REXAIR GUARANTY"; the
7-1/4% Notes, the 7-1/4% Notes Indenture, the 7-1/8% Notes, the 7-1/8% Notes
Indenture and the Rexair Guaranty are each referred to herein, individually,
as an "EXISTING INDEBTEDNESS AGREEMENT", and, collectively, as the "EXISTING
INDEBTEDNESS AGREEMENTS"), in favor of the Secured Creditors (as defined in
the Rexair Guaranty, such Secured Creditors being referred to herein as the
"REXAIR CREDITORS") in respect of Rexair, Inc.'s obligation under its Credit
Agreement, dated as of March 24, 2000, as amended.

            (6) Pursuant to each of the Existing Indebtedness Agreements, each
Borrower has agreed not to incur, and not to permit certain of its Subsidiaries
to incur, certain Liens (as therein defined) upon any of its property or assets
to secure certain Debt (as therein defined) without making effective provision
whereby the obligations under such Existing Indebtedness Agreement shall be
secured equally and ratably with the Debt secured by such Liens for so long as
such Debt shall be so secured.

            (7) This Agreement and the other Collateral Documents are intended
to secure the Existing Indebtedness Agreements to the extent required to comply
with the provisions of the Existing Indebtedness Agreements and the Collateral
Trustees have agreed to undertake the rights, powers, duties and
responsibilities set forth in this Agreement and the other Collateral Documents
in order to effect such purpose.

            NOW THEREFORE, in consideration of the premises and in order to
induce the Credit Parties to extend credit to the Borrowers under the Credit
Agreements, each Pledgor hereby agrees with the Collateral Trustees for its
benefit and the equal and ratable benefit of the Secured Holders as follows:

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                                    ARTICLE I

                                   DEFINITIONS

            SECTION 1.01. CERTAIN DEFINED TERMS. The following terms shall have
the following meanings as used herein (such meanings to be equally applicable to
both the singular and plural forms of the terms defined):

            "ACTIONABLE DEFAULT" has the meaning specified in Section 4.01.

            "ACTIONABLE DEFAULT NOTICE" has the meaning specified in Section
4.01.

            "ADDITIONAL COLLATERAL" has the meaning specified in Section 2.01.

            "AFFILIATE" has the meaning specified in the Credit Agreements.

            "AGREEMENT VALUE" means, for each Secured Hedge Agreement, on any
date of determination, an amount determined by the Representative for the Hedge
Bank a party to such Secured Hedge Agreement equal to: (a) in the case of a
Secured Hedge Agreement documented pursuant to the Master Agreement
(Multicurrency-Cross Border) published by the International Swap and Derivatives
Association, Inc. (the "MASTER AGREEMENT"), the amount, if any, that would be
payable by such Hedge Bank to its counterparty to such Secured Hedge Agreement,
as if (i) such Secured Hedge Agreement was being terminated early on such date
of determination, (ii) such Hedge Bank was the sole "Affected Party", and (iii)
such Representative was the sole party determining such payment amount (with
such Representative making such determination pursuant to the provisions of the
form of Master Agreement); or (b) in the case of a Secured Hedge Agreement
traded on an exchange, the mark-to-market value of such Secured Hedge Agreement,
which will be the unrealized loss on such Secured Hedge Agreement to such Hedge
Bank determined by such Representative based on the settlement price of such
Secured Hedge Agreement on such date of determination, or (c) in all other
cases, the mark-to-market value of such Secured Hedge Agreement, which will be
the unrealized loss on such Secured Hedge Agreement to such Hedge Bank
determined by such Representative as the amount, if any, by which (i) the
present value of the future cash flows to be paid by such Hedge Bank exceeds
(ii) the present value of the future cash flows to be received by such Hedge
Bank pursuant to such Secured Hedge Agreement; capitalized terms used and not
otherwise defined in this definition shall have the respective meanings set
forth in the above described Master Agreement.

            "AUTHORIZED OFFICER" means the Chairman, the President, any Vice
President, the Secretary or the Treasurer of a Person or any other officer
designated as an "Authorized Officer" by the Board of Directors (or equivalent
governing body) of such Person.

            "BANKRUPTCY CODE" means Title 11 of the United States Code entitled
"Bankruptcy", as amended from time to time.

            "BORROWERS" has the meaning specified in the recital of parties to
this Agreement.

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            "BUSINESS DAY" means a day of the year on which banks are not
required or authorized by law to close in New York City or the city in which the
Corporate Trustee maintains its corporate trust office.

            "CASH EQUIVALENTS" has the meaning specified in the Credit
Agreements.

            "COLLATERAL" means, collectively, all of the "Collateral" (as
defined in the Pledge and Security Agreement) and all of the Additional
Collateral.

            "COLLATERAL ACCOUNT " has the meaning specified in Section 3.01.

            "COLLATERAL DOCUMENTS" means this Agreement, the Pledge and Security
Agreement and each Successor Collateral Agreement.

            "COLLATERAL TRUST ESTATE" means all of the right, title and interest
of the Collateral Trustees, whether now owned or hereafter acquired, in and to
the Collateral.

            "COLLATERAL TRUSTEES" has the meaning specified in the recital of
parties to this Agreement.

            "COLLATERAL TRUSTEES' FEES" means the fees and other amounts payable
to the Collateral Trustees pursuant to Sections 6.03, 6.04 and 6.05 and amounts
claimed and unpaid pursuant to Section 6.06.

            "CORPORATE TRUSTEE" has the meaning specified in the recital of
parties to this Agreement.

            "CREDIT AGREEMENTS" has the meaning specified in the Preliminary
Statements.

            "CREDIT PARTIES" means the 5-Year Credit Parties and the 364-Day
Credit Parties.

            "DEFAULTED AGREEMENT PARTY" has the meaning specified in Section
4.01.

            "DISTRIBUTION DATE" means any date on which the Collateral Trustees
shall distribute moneys from the Collateral Account pursuant to Section 5.01.

            "EXISTING INDEBTEDNESS AGREEMENTS" has the meaning specified in the
Preliminary Statements and each agreement and instrument delivered by the
Borrowers pursuant thereto, as the same may be supplemented, amended or modified
from time to time in accordance with the provisions thereof.

            "5-YEAR AGENT" means Bank of America, N.A., in its capacity as
administrative agent for the Banks under the 5-Year Credit Agreement, and any
successor administrative agent for such Banks pursuant to the 5-Year Credit
Agreement.

            "5-YEAR CREDIT AGREEMENT" has the meaning specified in the
Preliminary Statements.

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            "5-YEAR CREDIT AGREEMENT AMENDMENT" means that certain Amendment and
Waiver to the 5-Year Credit Agreement dated as of February 16, 2001, among the
Borrowers and the 5-Year Credit Parties.

            "5-YEAR CREDIT PARTIES" means the Banks (as defined under the 5-Year
Credit Agreement) and the 5-Year Agent.

            "GOVERNMENTAL AUTHORITY" has the meaning specified in the Credit
Agreements.

            "HEDGE BANKS" means any Credit Party or Affiliate of a Credit Party
that has entered into a Secured Hedge Agreement.

            "INITIAL PLEDGOR" has the meaning specified in the recitals of
parties to this Agreement.

            "INDIVIDUAL TRUSTEE" has the meaning specified in the recital of
parties to this Agreement.

            "L/C CREDIT PARTY" means any Credit Party or Affiliate of a Credit
Party that has issued or hereafter issues a Permitted Letter of Credit.

            "L/C VALUE" means, for any Permitted Letters of Credit on any date
of determination, the undrawn face amount thereof plus, if any, the then unpaid
reimbursement obligations, with respect thereto.

            "MOODY'S" means Moody's Investor's Service, Inc.

            "PERFECTION DATE" means April 30, 2001.

            "PERMITTED LETTER OF CREDIT" means a letter of credit or bankers
acceptance (other than a Letter of Credit issued under the Credit Agreements)
issued by a L/C Credit Party at the order and for the benefit of a Borrower or a
Subsidiary, which letter of credit or bankers acceptance is outstanding on the
date hereof, or may hereafter be issued solely in replacement or as a
"roll-over" thereof by that or any other L/C Credit Party, PROVIDED that any
such existing, replacement or roll-over letter of credit or bankers acceptance
is at the time of its issuance permitted under the Credit Agreements.

            "PERMITTED LIENS" has the meaning specified in the Credit
Agreements.

            "PERSON" means an individual, partnership, corporation (including a
business trust), limited liability company, joint stock company, trust,
unincorporated association, joint venture or other entity, or a government or
any political subdivision or agency thereof.

            "PLEDGE AND SECURITY AGREEMENT" means a Pledge and Security
Agreement, dated as of the Perfection Date, made by each Initial Pledgor in
favor of the Collateral Trustees.

            "PLEDGORS" has the meaning specified in the recitals of parties to
this Agreement.

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            "REPRESENTATIVES" means at any time, collectively, (a) the 5-Year
Agent, as the representative hereunder for the 5-Year Credit Parties, certain
Hedge Banks (as provided in the next sentence) and certain L/C Banks (as
provided in the next sentence) at such time, (b) the 364-Day Agent, as the
representative hereunder for the 364-Day Credit Parties, the other Hedge
Banks and the other L/C Banks at such time, (c) the 7-1/4% Notes Trustee, as
the representative of the 7-1/4% Notes Holders at such time, (d) the 7-1/8%
Notes Trustee, as the representative hereunder for the 7-1/8% Notes Holders at
such time, and (e) the Rexair Agent, as the representative hereunder for the
Rexair Creditors at such time. For all purposes of this Agreement, (i) the
5-Year Agent will be the Representative for all Hedge Banks and L/C Banks
which are 5-Year Credit Parties or which are an Affiliate of a 5-Year Credit
Party and (ii) the 364-Day Revolver Agent will be the Representative for all
other Hedge Banks and L/C Banks.

            "REQUIRED REPRESENTATIVES" means, (a) at any time that no Actionable
Default has occurred or is continuing, the 5-Year Agent and the 364-Day Agent,
acting jointly, in their own discretion or at the direction of the Majority
Banks (as defined in the 5-Year Credit Agreement) at such time and the Majority
Banks (as defined under the 364-Day Credit Agreement) as such time, or (b) at
any time that an Actionable Default has occurred and is continuing, the
Representatives, on behalf of themselves and the Secured Holders represented
thereby, that own or hold (either by themselves or through their respective
Secured Holders) more than 50% of the aggregate amount of the outstanding
Secured Obligations at such time; PROVIDED, however, that amounts held at such
time by the Collateral Trustees on behalf of a Representative and such
Representative's Secured Holders in an account of the Corporate Trustee
established at the request of such Representative pursuant to Section 5.02
hereof shall be deemed to have been applied to repay the Secured Obligations of
such Secured Holders whether or not such amount has been so applied.

            "REXAIR AGENT" means Bank of America, N.A., in its capacity as
administrative agent for the Rexair Creditors, and any successor administrative
agent for the Rexair Creditors pursuant to the Credit Agreement referred to in
the Rexair Guaranty.

            "REXAIR CREDITORS" has the meaning specified in the Preliminary
Statements.

            "REXAIR GUARANTY" has the meaning specified in the Preliminary
Statements.

            "SECURED AGREEMENTS" means, collectively, the Credit Agreements, the
Existing Indebtedness Agreements, any Secured Hedge Agreements, any Secured L/C
Reimbursement Agreements and each agreement or instrument delivered by the
Borrowers pursuant thereto (including, without limitation, the Collateral
Documents), as the same may be amended from time to time in accordance with the
provisions thereof.

            "SECURED HEDGE AGREEMENT" means any hedge agreement required or
permitted under the Credit Agreements that is entered into by and between a
Borrower and any Hedge Bank.

            "SECURED HOLDERS" means, at any time, the 5-Year Credit Parties, the
364-Day Credit Parties, the 7-1/4% Notes Holders, the 7-1/8% Notes Holders, the
Rexair Creditors and any Hedge Banks and L/C Credit Parties at such time.

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            "SECURED L/C REIMBURSEMENT AGREEMENT" means the obligation of a
Pledgor to reimburse a L/C Credit Party for amounts hereafter paid by such L/C
Credit Party under or in respect of any Permitted Letters of Credit.

            "SECURED OBLIGATIONS" means at any time any obligations, whether
matured or unmatured, contingent or liquidated, of each of the Borrowers arising
out of or evidenced by the Secured Agreements, whether for principal, interest,
expenses, premiums, indemnities, fees or other amounts, whether or not such
obligations are due and payable at such time. For purposes of determining the
"Required Representatives" on any date, the aggregate amount of outstanding
Secured Obligations represented by each Representative on such date shall
include:

            (a) in the case of the Secured Obligations of Secured Holders
      represented by the 5-Year Agent under the 5-Year Credit Agreement, the
      then Aggregate Commitment (as therein defined), or if such Aggregate
      Commitment has then been terminated in full, the then outstanding Loans
      (as therein defined),

            (b) in the case of the Secured Obligations of Secured Holders
      represented by the 364-Day Agent under the 364-Day Credit Agreement, the
      then Aggregate Commitment (as therein defined), or if such Aggregate
      Commitment has then been terminated in full, the then outstanding Loans
      (as therein defined),

            (c) in the case of the Secured Obligations of Secured Holders
      represented by the Rexair Agent under the Rexair Guaranty, (i) the then
      outstanding Term Loans (as therein defined) and (ii) the then aggregate
      Revolving Loan Commitments (as therein defined), or if such Revolving Loan
      Commitments have been terminated in full, the then outstanding Swingline
      Loans (as therein defined), Letter of Credit Outstandings (as therein
      defined) and Revolving Loans (as therein defined),

            (d) in the case of Secured Obligations of Secured Holders
      represented by the 7-1/4% Notes Trustee under the 7-1/4% Notes Indenture,
      the 7-1/4% Notes then Outstanding (as therein defined),

            (e) in the case of the Secured Obligations of Secured Holders
      represented by the 7-1/8% Notes Trustee under the 7-1/8% Notes Indenture,
      the 7-1/8% Notes then Outstanding (as therein defined), and

            (f) in the case of the Secured Obligations of the Secured Holders
      represented by the 5-Year Agent or the 364-Day Agent, as the case may be,
      under any Secured L/C Reimbursement Agreement, the L/C Value of the
      Permitted Letters of Credit thereunder.

            (g) in the case of the Secured Obligations of the Secured Holders
      represented by the 5-Year Agent or the 364-Day Agent, as the case may be,
      under any Secured Hedge Agreement, the Agreement Value of such Secured
      Hedge Agreement.

            "7-1/4% NOTES" has the meaning provided in the Preliminary
Statements.

            "7-1/4% NOTES HOLDERS" means at any time the registered holders of
the 7-1/4% Notes issued under the 7-1/4% Notes Indenture at such time.

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            "7-1/4% NOTES INDENTURE" has the meaning provided in thE Preliminary
Statements.

            "7-1/4% NOTES TRUSTEE" means The Chase Manhattan Bank, as Trustee
for the 7-1/4% Notes Holders, and any successor trustee for the 7-1/4% Notes
Holders appointed under the 7-1/4% Notes Indenture.

            "7-1/8% NOTES" has the meaning provided in the Preliminary
Statements.

            "7-1/8% NOTES HOLDERS" means at any time the registered holders of
the 7-1/8% Notes issued under the 7-1/8% Notes Indenture at such time.

            "7-1/8% NOTES INDENTURE" has the meaning provided in the Preliminary
Statements.

            "7-1/8% NOTES TRUSTEE" means Bank One Trust Company, N.A. (successor
in interest to The First National Bank of Chicago), as Trustee for the 7-1/8%
Notes Holders, and any successor trustee for the 7-1/8% Notes Holders appointed
under the 7-1/8% Notes Indenture.

            "S&P" means Standard & Poors, a division of The McGraw-Hill
Companies, Inc.

            "SUBSIDIARY" has the meaning provided in the Credit Agreements.

            "SUCCESSOR COLLATERAL" means, with respect to each Pledgor, any
property and assets of such Pledgor (or any of its successors and assigns) as
such Pledgor (or any such successor or any such assign) may, from time to time,
upon notice to the Collateral Trustees, pursuant to the Credit Agreements or
otherwise, grant to the Collateral Trustees as additional collateral for their
benefit and in trust for the equal and ratable benefit of the Representatives,
on their behalf and on behalf of the Secured Holders.

            "SUCCESSOR COLLATERAL AGREEMENTS" means all Security Instruments and
other documents creating, evidencing or relating to any of the Successor
Collateral.

            "364-DAY AGENT" means Bank of America, N.A., in its capacity as
administrative agent for the Banks under the 364-Day Credit Agreement, and any
successor administrative agent for such Banks pursuant to the 364-Day Credit
Agreement.

            "364-DAY CREDIT AGREEMENT" has the meaning specified in the
Preliminary Statements.

            "364-DAY CREDIT PARTIES" means the Banks (as defined under the
364-Day Credit Agreement) and the 364-Day Agent.

            "UNRESTRICTED SECURED HOLDERS" means, at any time, the 5-Year Credit
Parties, the 364-Day Credit Parties, the Rexair Creditors and any Hedge Banks
and L/C Credit Parties at such time.

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            "UNRESTRICTED SUBSIDIARY PLEDGORS" means, at any time, any
Subsidiary that is an Unrestricted Subsidiary under the terms of the 7-1/4%
Notes Indenture and the 7-1/8% Notes Indenture.

            "UNRESTRICTED SUBSIDIARY PLEDGORS PROCEEDS" means any proceeds from
the sale or other disposition of any Collateral belonging to any Unrestricted
Subsidiary Pledgor.

            "USI" has the meaning specified in the recitals of parties to this
Agreement.

            "USI AMERICAN" has the meaning specified in the recitals of parties
to this Agreement.

            "USI GLOBAL" has the meaning specified in the recitals of parties to
this Agreement.

            SECTION 1.02. CERTAIN REFERENCES. In this Agreement, the words
"hereof," "herein" and "hereunder", and words of similar import, shall refer to
this Agreement as a whole and not to any particular provision of this Agreement.
All section, schedule and exhibit references set forth in this Agreement are,
unless otherwise specified, references to such section in, or schedule or
exhibit to, this Agreement.

                                   ARTICLE II

                 CONFIRMATION AND CREATION OF SECURITY INTERESTS

            SECTION 2.01. COLLATERAL TRUST ESTATE. Each Pledgor hereby confirms
that, pursuant to the terms of the Pledge and Security Agreement, such Pledgor
has pledged and assigned to the Collateral Trustees for their benefit and in
trust for the equal and ratable benefit of the Representatives and the Secured
Holders, and has granted the Collateral Trustees for their benefit and in trust
for the equal and ratable benefit of the Representatives and the Secured Holders
a lien on and security interest in, the Collateral described therein. Each
Pledgor hereby further pledges and assigns to the Collateral Trustees for their
benefit and in trust for the equal and ratable benefit of the Representatives,
on their behalf and on behalf of the Secured Holders, and hereby grants to the
Collateral Trustees for their benefit and in trust for the equal and ratable
benefit of the Representatives, on their behalf and on behalf of the Secured
Holders, a lien on and security interest in, the following (collectively,
together with any Successor Collateral, the "ADDITIONAL COLLATERAL"):

            (i) the Collateral Account established pursuant to Section 3.01(a)
      with the Corporate Trustee at its offices at its corporate trust
      department in the State of Delaware and is, and shall at all times remain,
      under the sole dominion and control of the Corporate Trustee, all funds
      held therein and all certificates and instruments, if any, from time to
      time representing each Collateral Account;

            (ii) all Cash Equivalents held in the Collateral Account from time
      to time and all certificates and instruments, if any, from time to time
      representing or evidencing such Cash Equivalents;

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            (iii) all notes, certificates of deposit, deposit accounts, checks
      and other instruments from time to time delivered to or otherwise
      possessed by the Collateral Trustees for or on behalf of such Pledgor in
      substitution for or in addition to any or all of the then existing
      Additional Collateral;

            (iv) all interest, income, dividends, instruments and other property
      and assets from time to time received, receivable or otherwise distributed
      in respect of or in exchange for any or all of the then existing
      Additional Collateral referred to in clauses (i) through (iii) of this
      Section 2.01(a); and

            (v) all proceeds of any and all of the foregoing Additional
      Collateral (including, without limitation, proceeds that constitute
      property and assets of the types described in clauses (i) through (iv) of
      this Section 2.01(a)) and, to the extent not otherwise included, all (A)
      payments under any indemnity, warranty or guaranty payable with respect to
      any of the foregoing Additional Collateral, and (B) cash.

            SECTION 2.02. SECURITY FOR SECURED OBLIGATIONS. All of the right,
title and interest of the Collateral Trustees in and to the Collateral Trust
Estate secures the payment of all of the Secured Obligations now or hereafter
existing under or in respect of the Secured Agreements and the performance of,
and the compliance with, all of the covenants and conditions of this Agreement,
the other Collateral Documents and the Secured Agreements. Without limiting the
generality of the foregoing, the Collateral Trust Estate secures the payment of
all amounts that constitute part of the Secured Obligations and would be owed by
any Borrower to the Collateral Trustees, any Representative or any Secured
Holder under the Collateral Documents or the Secured Agreements but for the fact
that they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving such Borrower.

                                  ARTICLE III

                               COLLATERAL ACCOUNT

            SECTION 3.01. COLLATERAL ACCOUNT. (a) So long as any Secured
Obligations remain outstanding under any Secured Agreement, a non-interest
bearing cash collateral account (the "COLLATERAL ACCOUNT") for the
Representatives and the Secured Holders shall be maintained by the Corporate
Trustee at its offices at its corporate trust department in the State of
Delaware in accordance with the terms of this Agreement. All moneys that are
received by the Collateral Trustees upon the occurrence and during the
continuance of an Actionable Default, upon liquidation or otherwise in respect
of the Collateral shall be deposited in the Collateral Account and, thereafter,
shall be held and applied by the Corporate Trustee all in accordance with the
terms of this Agreement.

            (b) The Corporate Trustee shall, subject to the provisions of
Article IV and Article VIII, from time to time (i) invest amounts on deposit in
the Collateral Account in Cash Equivalents and (ii) invest interest paid on such
Cash Equivalents, and reinvest other proceeds of any such Cash Equivalents that
may mature or be sold, in additional Cash Equivalents, in each case at the
direction of USI so long as no Actionable Default shall have occurred and be
continuing and at the direction of the Required Representatives if an Actionable
Default shall

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have occurred and be continuing. Interest and proceeds that are not invested or
reinvested in Cash Equivalents as provided in the immediately preceding sentence
shall be deposited and held in the Collateral Account. Notwithstanding the
foregoing, the Corporate Trustee shall, to the extent possible, invest any funds
to be distributed on a Distribution Date in Cash Equivalents that shall mature
or become liquid on or prior to such Distribution Date. All Cash Equivalents
made in respect of the Collateral Account and all interest and income received
thereon and therefrom and the net proceeds realized on the maturity or sale
thereof shall be held in the Collateral Account as part of the Collateral Trust
Estate pursuant to the terms hereof.

            (c) The Collateral Account shall be subject to such applicable laws,
and such applicable regulations of the Board of Governors of the Federal Reserve
System and of any other appropriate banking or Regulatory Authority, as are in
effect from time to time.

                                   ARTICLE IV

                          ACTIONABLE DEFAULTS; REMEDIES

            SECTION 4.01. ACTIONABLE DEFAULT NOTICE. (a) If, at any time, a
default under any Secured Agreement shall have occurred and be continuing and,
as a result thereof, any Representative or any Secured Holder under, or the
percentage of Secured Holders specified in, such Secured Agreement (any such
party or percentage of Secured Holders being a "DEFAULTED AGREEMENT Party") has
the right thereunder (without the delivery of any further notice or the
requirement that any further time elapse) to declare all of the Secured
Obligations of the Borrowers under such Secured Agreement to be due and payable
prior to the stated maturity thereof (any such default being an "ACTIONABLE
DEFAULT"), and if such Defaulted Agreement Party gives the Collateral Trustees,
with a copy to USI, a notice (an "ACTIONABLE DEFAULT NOTICE") stating:

            (i) the nature of the Actionable Default;

            (ii) the action requested to be taken by the Collateral Trustees
      with respect to the Collateral and the Collateral Documents (which action
      may include, without limitation, the calling of a meeting of the
      Representatives or the institution of any remedies provided by law or this
      Agreement or any Collateral Document); and

            (iii) that such Defaulted Agreement Party requests the Collateral
      Trustees to poll the Representatives with respect to such action,

then the Collateral Trustees shall forthwith send a copy of the Actionable
Default Notice to each Representative and poll the Representatives as to whether
they favor the Collateral Trustees taking such action. If the Required
Representatives shall have directed the Collateral Trustees to commence the
action set forth in the Actionable Default Notice (whether or not such poll
shall have been taken or completed), then, subject to Section 4.01(b) and the
right of the Collateral Trustees to commence such action under the Collateral
Documents, the Collateral Trustees shall forthwith undertake such action. The
Collateral Trustees shall, subject to Section 4.01(b) and Section 4.08, follow
the directions of the Required Representatives with respect to the time, method
and place of taking any action requested in an Actionable Default Notice. Each

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Collateral Trustee shall be entitled to assume conclusively that no Actionable
Default has occurred and is continuing until it receives an Actionable Default
Notice.

            (b) If the Actionable Default which was the basis for the giving of
an Actionable Default Notice shall be cured or waived in accordance with the
terms of the applicable Secured Agreement, the Defaulted Agreement Party which
gave such Actionable Default Notice shall promptly notify the Collateral
Trustees in writing of such cure or waiver, whereupon (i) such Actionable
Default Notice shall be deemed withdrawn, (ii) the Collateral Trustees shall
deliver to each Representative such writing evidencing the withdrawal of a
Default Notice as it may have received pursuant to this Section (b) and (iii)
any direction to the Collateral Trustees to take any action in connection with
such Actionable Default Notice shall be deemed rescinded. If in connection
solely with such withdrawn Actionable Default Notice the Collateral Trustees
shall have been directed to take, and shall have commenced taking but shall not
have completed, any action, the Collateral Trustees shall promptly terminate any
such action which they shall not also have been directed to take in connection
with an Actionable Default Notice other than that withdrawn.

            SECTION 4.02. DIRECTION BY REQUIRED REPRESENTATIVES. As to any
matters not expressly provided for under this Agreement or the other Collateral
Documents (including, without limitation, matters relating to enforcement and
collection of the Secured Obligations), the Collateral Trustees shall not be
required to exercise any discretion or to take any action under this Agreement
or the other Collateral Documents, or in respect of the Collateral, but shall be
required to act or to refrain from acting (and shall be fully protected in
acting or refraining from acting) in accordance with the instructions of the
Required Representatives.

            SECTION 4.03. RIGHT TO INITIATE JUDICIAL PROCEEDINGS, ETC. (a) Upon
the occurrence of and during the continuance of any Actionable Default, the
Corporate Trustee, and if the Corporate Trustee deems necessary or desirable,
the Individual Trustee, jointly or individually as the Corporate Trustee my
determine, (i) shall have the right and power to institute and maintain such
suits and proceedings as it or they, as the case may be, or the Required
Representatives may deem appropriate to protect and enforce the rights vested in
them by this Agreement and the other Collateral Documents and (ii) may either,
after entry or without entry, proceed by suit or suits at law or in equity to
enforce such rights and to foreclose upon the Collateral and to dispose of,
collect or otherwise realize upon, all or any portion of the Collateral Trust
Estate under the judgment or decree of a court of competent jurisdiction.

            (b) If a receiver of the Collateral Trust Estate shall be appointed
in judicial proceedings, the Collateral Trustees may be appointed as such
receiver. Notwithstanding the appointment of a receiver, the Collateral Trustees
shall be entitled to retain possession and control of all cash held by or
deposited with them or their agents or co-trustees pursuant to any provision of
this Agreement or any other Collateral Document.

            SECTION 4.04. REMEDIES NOT EXCLUSIVE. (a) No remedy conferred upon
or reserved to the Collateral Trustees herein or in the Collateral Documents is
intended to be a limitation 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 Collateral Documents or now or hereafter existing at
law or in equity or by statute.

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<PAGE>

            (b) No delay or omission of either of the Collateral Trustees to
exercise any right, remedy or power accruing upon any Actionable Default shall
impair any such right, remedy or power or shall be construed to be a waiver of
any such Actionable Default or any acquiescence therein; and every right, power
and remedy given by this Agreement or any Collateral Document to the Collateral
Trustees may be exercised from time to time and as often as may be deemed
expedient by the Collateral Trustees.

            (c) In case either of the Collateral Trustees shall have proceeded
to enforce any right, remedy or power under this Agreement or any Collateral
Document and the proceeding for the enforcement thereof shall have been
discontinued or abandoned for any reason or shall have been determined adversely
to such Collateral Trustee, then and in every such case each Pledgor, the
Collateral Trustees, the Representatives and Secured Holders shall, subject to
any determination in such proceeding, severally be restored to their former
positions and rights hereunder and under such Collateral Document with respect
to the Collateral Trust Estate, the Collateral Account and in all other
respects, and thereafter all rights, remedies and powers of such Collateral
Trustee shall continue as though no such proceeding had been taken.

            (d) Each Pledgor expressly agrees that all rights of action and
rights to assert claims upon or under this Agreement and the Collateral
Documents may be enforced by the Collateral Trustees without the possession of
any debt instrument or the production thereof in any trial or other proceeding
relative thereto, and any such suit or proceeding instituted by the Collateral
Trustees shall be brought in either of their names as Collateral Trustee and any
recovery of judgment shall be held as part of the Collateral Trust Estate;
PROVIDED that nothing in this Section 4.04(d) shall constitute a waiver of any
right that each Pledgor may have or may hereafter acquire to challenge the
amounts outstanding under the Secured Agreements.

            SECTION 4.05. WAIVER OF CERTAIN RIGHTS. Each Pledgor, on behalf of
itself and all who may claim through or under it, including, without limitation,
any and all subsequent Affiliates, creditors, vendees, assignees and lienors,
expressly waives and releases, to the fullest extent permitted by law, any,
every and all rights to demand or to have any marshalling of the Collateral
Trust Estate upon any enforcement of any Collateral Document, including, without
limitation, upon any sale, whether made under any power of sale herein granted
or pursuant to judicial proceedings or upon any foreclosure or any enforcement
of any Collateral Document or this Agreement and consents and agrees that all
the Collateral Trust Estate and any such sale may be offered and sold as an
entirety.

            SECTION 4.06. LIMITATION ON COLLATERAL TRUSTEES' DUTIES IN RESPECT
OF COLLATERAL. Beyond the duties set forth in this Agreement, the Collateral
Trustees shall not have any duty to any Pledgor or the Representatives as to any
Collateral in the Collateral Trustees' possession or control or in the
possession or control of any agent or nominee of the Collateral Trustees or any
income thereon or as to the preservation of rights against prior parties or any
other rights pertaining thereto, except that each Collateral Trustee shall be
liable for its failure to exercise ordinary care in the handling of moneys and
securities and other property actually received by it.

            SECTION 4.07. LIMITATION BY LAW. All rights, remedies and powers
provided by this Article 4 may be exercised only to the extent that the exercise
thereof does not violate any applicable provision of law, and all the provisions
of this Article 4 are intended to be subject to

                                       13
<PAGE>

all applicable mandatory provisions of law which may be controlling and to be
limited to the extent necessary so that they will not render this Agreement
invalid, unenforceable in whole or in part or, if the Representatives elect that
this Agreement should be recorded, registered or filed, not entitled to be
recorded, registered, or filed under the provisions of any applicable law.

            SECTION 4.08. ABSOLUTE RIGHTS OF SECURED HOLDERS AND
REPRESENTATIVES. Notwithstanding any other provision of this Agreement or any of
the other Collateral Documents, each of the Representatives and each of the
Secured Holders has an absolute and unconditional right to receive payment of
all of the Secured Obligations owing to such Representative or such Secured
Holder, as the case may be, when the same becomes due and payable and at the
time and place and otherwise in the manner set forth in the applicable Secured
Agreements, and the right of each such Representative and each such Secured
Holder to institute proceedings for the enforcement of such payment on or after
the date such payment becomes due and to assert its position as a secured
creditor in a proceeding under the Bankruptcy Code in which any Borrower is a
debtor, and the obligation of each Borrower to pay all of the Secured
Obligations owing to each of the Representatives and each of the Secured Holders
at the time and place expressed therein, shall not be impaired or affected
without the consent of such Representative or such Secured Holder. In addition,
the right of any Secured Holder or any Representative, on behalf of itself or on
behalf of any such Secured Holder, to receive payment or security from sources
other than the Collateral shall not be, and is not hereby, impaired or affected
in any manner. Without limiting the generality of the foregoing provisions of
this Section 4.08, no Secured Holder and no Representative, on behalf of itself
or on behalf of any Secured Holder, shall be obligated to share with any other
Secured Holder or any other Representative any proceeds of any collateral,
guaranty or right of setoff other than pursuant to, and to the extent expressly
required under, this Agreement and the other Secured Agreements; nor shall any
Secured Holder's or any Representative's right to receive its ratable share of
any amounts maintained in the Collateral Account, if any, or any proceeds of any
of the Collateral, or any part thereof, under the terms of this Agreement and
the other Collateral Documents be diminished or affected in any way by its right
to receive proceeds of any other collateral or right of setoff, or payment upon
a guaranty or from any other source.

            SECTION 4.09. EQUAL AND RATABLE SECURITY. This Agreement is intended
solely to comply with the provisions of the Existing Indebtedness Agreements to
secure the unpaid Secured Obligations arising thereunder, equally and ratably
with the Secured Obligations arising under the Credit Agreements. To the extent
that the rights and benefits herein conferred on the Secured Holders or the
Representative under any Existing Indebtedness Agreement shall be held to exceed
the rights and benefits required so to be conferred by such provisions of such
Existing Indebtedness Agreement, such rights and benefits shall be limited so as
to provide to such Secured Holders and such Representative only those rights and
benefits that are required by such provisions of such Existing Indebtedness
Agreement. Any and all rights not herein expressly given to the Representatives
under any Existing Indebtedness Agreement are expressly reserved to the Credit
Parties under the Credit Agreements, it being understood that in the absence of
a requirement to provide equal and ratable security set forth in the Existing
Indebtedness Agreements, this Agreement would not have been accepted by the
Credit Parties.

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<PAGE>

                                   ARTICLE V

                             APPLICATION OF PROCEEDS

            SECTION 5.01. APPLICATION OF PROCEEDS. (a) If, following the
acceleration of the principal amount of the Secured Obligations under any
Secured Agreement and pursuant to the exercise of any remedy set forth in any
Collateral Documents, any Collateral is sold or otherwise realized upon by the
Collateral Trustees, the proceeds received by the Collateral Trustees in respect
of such Collateral shall be deposited in the Collateral Account, and all moneys
held by the Corporate Trustee in the Collateral Account shall, to the extent
available for distribution, be distributed by the Corporate Trustee on each date
upon which a distribution is made (each, a "DISTRIBUTION DATE") as follows:

            FIRST, to the payment (in such priority as the Corporate Trustee
      shall elect, but without duplication) of all reasonable legal fees and
      expenses and other reasonable costs or expenses or other liabilities of
      any kind incurred by the Collateral Trustees as secured parties under any
      Collateral Document or otherwise in connection with any Collateral
      Document or this Agreement (including, without limitation, any reasonable
      costs or expenses or liabilities incurred in connection with the sale of
      any assets covered by any Collateral Document, or in the operation or
      maintenance of any of the assets covered by any Collateral Document),
      including the reimbursement to any Representative of any amounts
      theretofore advanced by such Representative for the payment of such fees,
      costs and expenses, except only for any such fees, expenses, costs or
      liabilities incurred by any Collateral Trustee as a result of its gross
      negligence or willful misconduct in performing or failing to perform any
      of its duties to the parties hereto expressly set forth herein; PROVIDED,
      HOWEVER, that nothing herein is intended to relieve any Borrower of its
      duties to pay such costs, fees, expenses and liabilities otherwise payable
      to the Collateral Trustees from funds outside of the Collateral Account,
      as required by this Agreement;

            SECOND, to the Collateral Trustees (without duplication) in an
      amount equal to the Collateral Trustees' Fees which are unpaid as of the
      Distribution Date and to any Representative which has theretofore advanced
      or paid any such Collateral Trustees' Fees in an amount equal to the
      amount thereof so advanced or paid by such Representative prior to such
      Distribution Date; PROVIDED, HOWEVER, that nothing herein is intended to
      relieve any Borrower of its duties to pay such fees and claims from funds
      outside of the Collateral Account, as required by this Agreement;

            THIRD, pursuant to paragraph (b) below, (1) with respect to any
      proceeds other than Unrestricted Subsidiary Pledgor Proceeds, ratably to
      the Representatives on behalf of the respective Secured Holders for
      application to the Secured Obligations of such Secured Holders, and (2)
      with respect to any Unrestricted Subsidiary Pledgor Proceeds, ratably to
      the Representatives of Unrestricted Secured Holders on behalf of the
      respective Unrestricted Secured Holders, or, in each case, to be held by
      such Representative (or by the Corporate Trustee on behalf of such
      Representative pursuant to Section 5.02 or otherwise) pending such
      application;

            FOURTH, any surplus remaining after the payment in full in cash of
      the Secured Obligations shall, pursuant to the provisions of Section 8.02,
      be paid to the Borrowers,

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<PAGE>

      their successors or assigns, or to whomsoever may be lawfully entitled to
      receive the same, or as a court of competent jurisdiction may direct.

            (b) In order to determine the ratable amount to be distributed to
each of the Representatives pursuant to clause THIRD above on each Distribution
Date, unless otherwise directed in writing by the Representatives, the Corporate
Trustee may rely on a certificate of an Authorized Officer of USI setting forth
the Secured Obligations (identified by type and amount) outstanding under each
Secured Agreement on such Distribution Date. The ratable portion of the
aggregate amount available for distribution hereunder on any Distribution Date
which shall be distributed to each Representative entitled to such distribution
on such Distribution Date shall be a fraction, (i) the numerator of which shall
be the aggregate amount of Secured Obligations of the Secured Holders
represented by such Representative, and (ii) the denominator of which shall be
(A) with respect to the distribution of any proceeds other than Unrestricted
Subsidiary Pledgor Proceeds, the aggregate amount of Secured Obligations of all
the Secured Holders represented by all Representatives and (B) with respect to
the distribution of any Unrestricted Subsidiary Pledgor Proceeds, the aggregate
amount of Secured Obligations of all the Unrestricted Secured Holders
represented by the Representatives of such Unrestricted Secured Holders;
PROVIDED, HOWEVER, that the aggregate amount distributable to such
Representative on such Distribution Date shall not exceed the aggregate amount
of Secured Obligations of the Borrowers which are then due and payable by the
Borrowers to the Secured Holders of such Representative; and, PROVIDED, FURTHER,
that, for such purposes, amounts distributable to a Representative on a prior
Distribution Date and held on behalf of such Representative and the Secured
Holders of such Representative pursuant to Section 5.02 of this Agreement shall
be deemed to have been applied to the Secured Obligations of the Secured Holders
represented by such Representative, regardless of whether such application has
occurred.

            SECTION 5.02. APPLICATION OF WITHHELD AMOUNTS. If on any
Distribution Date any amounts on deposit to the Collateral Account are
distributable pursuant to Section 5.01 to any Representative, and if such
Representative shall have given notice to the Collateral Trustees on or prior to
such Distribution Date that all or a portion of such proceeds which are
otherwise distributable to such Representative pursuant to Section 5.01 shall be
held by the Collateral Trustees on behalf of such Representative for the benefit
of the Secured Holders of such Representative, then the Collateral Trustees
shall hold such amount in a separate non-interest bearing cash collateral
account of the Corporate Trustee for the benefit of such Representative and such
Secured Holders, until such time as such Representative shall deliver a written
request for the delivery thereof from such account to such Representative or as
such Representative may otherwise direct in such notice. If thereafter the
Secured Obligations of the Secured Holders represented by any such
Representative shall have been repaid in full in cash on any date, then (a) upon
the written request of USI (or any other Representative) certifying as to such
payment in full, and (b) after delivery of such notice by the Collateral
Trustees to such Representative, the Collateral Trustees shall not have received
a written notice of objection from such Representative within 30 days such
Representative's receipt of such notice, promptly following such 30th day (or
the earlier receipt by the Collateral Trustees of the written consent of such
Representative), any amounts held on account for such Representative pursuant to
this Section 5.02 shall be again deposited by the Collateral Trustee to the
Collateral Account and thereafter distributed as provided in Section 5.01. The
Corporate Trustee shall invest amounts on deposit

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<PAGE>

to any such account in such Cash Equivalents as the applicable Representative
may direct from time to time.

            SECTION 5.03. RELEASE OF AMOUNTS IN COLLATERAL ACCOUNT. Amounts
distributable to a Representative on any Distribution Date pursuant to Section
5.01 shall either be paid to such Representative for the benefit of such
Representative and its Secured Holders by the Corporate Trustee (or deposited to
an account for the benefit of such Representative and its Secured Holders
pursuant to Section 5.02) upon receipt by the Corporate Trustee of a certificate
of such Representative setting forth appropriate payments instructions for such
Representative. If no such notice is delivered by a Representative within 10
Business Days thereafter, the Corporate Trustee shall deposit amounts otherwise
distributable to such Representative to an account for the benefit of such
Representative and its Secured Holders pursuant to Section 5.02 hereof.

            SECTION 5.04. DISTRIBUTION DATE. Upon the occurrence and during the
continuance of an Actionable Default, any amounts on deposit in the Collateral
Account shall, at the written request of a Defaulted Agreement Party (with a
copy to USI), and with the written consent of the Required Representatives, be
distributed as provided in this Article V.

                                   ARTICLE VI

                     AGREEMENTS WITH THE COLLATERAL TRUSTEE

            SECTION 6.01. DELIVERY OF AGREEMENTS. On the Perfection Date, the
Borrowers will deliver to the Collateral Trustees a true and complete copy of
each Secured Agreement, including each Collateral Document, as in effect on the
Perfection Date. Each Pledgor agrees that, promptly upon the execution thereof,
such Pledgor will deliver to the Collateral Trustees a true and complete copy of
any and all Collateral Documents entered into subsequent to the date hereof and
a true and complete copy of any and all amendments, modifications or supplements
to any of the foregoing.

            SECTION 6.02. INFORMATION AS TO REPRESENTATIVES. Each Borrower
agrees that it shall deliver to the Collateral Trustees from time to time upon
request of the Collateral Trustees a list setting forth, for each Secured
Agreement, (a) the aggregate principal amount outstanding thereunder, (b) the
accrued and unpaid interest thereunder, (c) the accrued and unpaid fees (if any)
thereunder, (d) the names of the Representatives and of the Secured Holders (to
the extent known to the Borrowers) thereunder, and all other unpaid amounts
thereunder known to the Borrowers, owing to each such Representative, for its
own account and on behalf of such Secured Holders and (e) such other information
regarding the Representatives, such Secured Holders and the Secured Agreements
as the Collateral Trustees may reasonably request. In addition, the Borrowers
shall deliver to the Collateral Trustees, each time a distribution from the
Collateral Trust Estate or, the Collateral Account is to be made pursuant to the
terms hereof, not later than two Business Days after receipt of a copy of the
applicable distribution request delivered by a Defaulted Agreement Party
pursuant to Section 5.04 hereof, a certificate of an Authorized Officer, setting
forth the amounts to be distributed and the Persons to whom such distributions
are to be made, including appropriate payment instructions therefor, PROVIDED,
that if any distribution is directed to be made to any Representative, if such
Representative shall have notified the Collateral Trustees in writing that such
Representative is unable to accept such

                                       17
<PAGE>

distribution, such distribution shall be made instead to an account established
pursuant to Section 5.02 hereof for the benefit of such Representative and its
Secured Holders. The Borrowers will furnish to the Collateral Trustees, with a
copy to each Representative, on the Perfection Date a list setting forth the
name and address of each Representative and each Person to whom notices must be
sent under the Secured Agreements and each Borrower agrees to furnish promptly
to the Collateral Trustees any changes or additions to such list of which the
Borrowers are made aware. Unless otherwise specified herein, the Collateral
Trustees may for all purposes hereunder, rely on such information given by the
Borrowers unless (i) the Collateral Trustees shall have actual knowledge of an
inaccuracy or (ii) any Representative shall provide contrary information with
respect to such Representative in which case, unless such Representative and the
Borrowers can reach an agreement on such issue within a period of 10 days, the
Collateral Trustees shall appoint an independent arbitrator (who shall be
reasonably acceptable to the Borrowers and such Representative) to resolve the
dispute (at the expense of the Borrowers).

            SECTION 6.03. COMPENSATION AND EXPENSES. The Borrowers agree,
jointly and severally, to pay to the Collateral Trustees and any co-trustees or
successor trustees appointed hereunder, from time to time upon demand, (a) such
compensation for their services hereunder and under the Collateral Documents and
for administering the Collateral Trust Estate, the Collateral Account and any
account or accounts established pursuant to Section 5.02 hereof as set forth on
the fee schedule attached hereto as Schedule 1, as such Schedule 1 may be
amended, supplemented or otherwise modified by the written agreement of the
Borrowers and the Collateral Trustees from time to time and (b) all the
reasonable fees, costs and expenses incurred by any of them (including, without
limitation, the reasonable fees and disbursements of counsel) (i) arising in
connection with the preparation, execution, delivery, modification and
termination of this Agreement and each Collateral Document or the enforcement of
any of the provisions hereof or thereof or (ii) incurred or required to be
advanced in connection with the administration of the Collateral Trust Estate,
the Collateral Account, any account or accounts established pursuant to Section
5.02 hereof, the sale or other disposition of Collateral pursuant to any
Collateral Document and the preservation, protection or defense of their rights
under this Agreement and in and to the Collateral, the Collateral Account, any
account or accounts established pursuant to Section 5.02 hereof and the
Collateral Trust Estate. As security for such payment, the Collateral Trustees
shall have a prior lien upon all Collateral and other property and funds held or
collected by the Collateral Trustees as part of the Collateral Trust Estate.
Each Borrower's obligations under this Section 6.03 shall survive the
termination of this Agreement.

            SECTION 6.04. STAMP AND OTHER SIMILAR TAXES. Each Borrower agrees to
indemnify and hold harmless the Collateral Trustees, each Representative and
each Secured Holder from any present or future claim for liability for any stamp
or other similar tax and any penalties or interest with respect thereto, which
may be assessed, levied or collected by any jurisdiction in connection with this
Agreement, any Collateral Document, the Collateral Trust Estate, the Collateral
Account, any account or accounts established pursuant to Section 5.02 hereof or
any Collateral. The obligations of each Borrower under this Section 6.04 shall
survive the termination of this Agreement.

            SECTION 6.05. FILING FEES, EXCISE TAXES, ETC. Each Borrower agrees
to pay or to reimburse the Collateral Trustees for any and all amounts in
respect of all reasonable search, filing, recording and registration fees,
taxes, excise taxes and other similar imposts which may be

                                       18
<PAGE>

payable or determined to be payable in respect of the execution, delivery,
performance and enforcement of this Agreement and each Collateral Document. The
obligations of each Borrower under this Section 6.05 shall survive the
termination of this Agreement.

            SECTION 6.06. INDEMNIFICATION. (a) Each Borrower agrees to pay,
indemnify, and hold harmless the Collateral Trustees and each of the agents of
either thereof from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever (including, without limitation, the costs and
expenses of defending any claim against any of them) with respect to the
execution, delivery, enforcement, performance and administration of this
Agreement and the Collateral Documents unless and to the extent arising from the
gross negligence or willful misconduct of such of the Collateral Trustees or
such of the agents thereof as are seeking indemnification or any failure of any
Collateral Trustee or any such agent to exercise ordinary care in the handling
of moneys and securities and other property actually received by any such
Collateral Trustee or any such agent. As security for such payment, any such
Collateral Trustee shall have a prior lien upon all Collateral and other
property and funds held or collected by the Collateral Trustees as part of the
Collateral Trust Estate.

            (b) In any suit, proceeding or action brought by the Collateral
Trustees under or with respect to any Collateral Document or the Collateral for
any amount owing thereunder, or to enforce any provisions thereof, each Borrower
will save, indemnify and hold harmless the Collateral Trustees, the
Representatives and the Secured Holders from and against all expense, loss or
damage suffered by reason of any defense, set-off, counterclaim, recoupment or
reduction of liability whatsoever of the obligee thereunder (unless and to the
extent that such expense, loss or damage is caused by the gross negligence or
willful misconduct of the such Collateral Trustee or the failure of any
Collateral Trustee to exercise ordinary care in the handling of moneys and
securities and other property actually received by such Collateral Trustee),
arising out of a breach by any Pledgor 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 any Pledgor and all such
obligations of each Pledgor shall be and remain enforceable against and only
against such Pledgor and shall not be enforceable against the Collateral
Trustees, any Representative or any Secured Holder. The agreements in this
Section 6.06 shall survive the termination of this Agreement.

            SECTION 6.07. FURTHER ASSURANCES. (a) Each Borrower agrees, from
time to time, at its own expense to execute, acknowledge, deliver, record,
re-record, file, re-file, register and re-register, and cause its Subsidiaries,
if any, to promptly execute, acknowledge, deliver, record, re-record, file,
re-file, register and re-register any and all such further acts, financing
statements and continuations thereof, notices of assignment, transfers,
certificates, assurances and other instruments as may be reasonably necessary or
desirable, or as any Collateral Trustee, any Representative, any Secured Holder
through its Representative, may reasonably request from time to time in order
(i) to carry out more effectively the purposes or this Agreement, (ii) to
subject to the liens and security interests created by any of the Collateral
Documents any of the properties, rights or interests of any Pledgor covered or
now or hereafter intended to be covered by any of the Collateral Documents,
(iii) to perfect and maintain the validity, effectiveness and priority of any of
the Collateral Documents and the liens and security interests intended to be
created thereby, (iv) to better assure, convey, grant, assign, transfer,
preserve, protect and

                                       19
<PAGE>

confirm unto the Collateral Trustees, the Representatives and the Secured
Holders the rights granted or now or hereafter intended to be granted to the
Collateral Trustees, the Representatives and the Secured Holders under any
Collateral Document or under any other instrument executed in connection with
any Collateral Document to which it is or may become a party, and (v) to enable
the Collateral Trustees to exercise and enforce their rights and remedies
hereunder and under each Collateral Document with respect to any Collateral;
PROVIDED, HOWEVER, that this Section 6.07 shall not be construed to require any
Pledgor to grant any interest in Collateral other than pursuant to this
Agreement, the Credit Agreements or any Collateral Document. Without limiting
the generality of the foregoing, each Pledgor will take any such action required
to be taken by it pursuant to any Collateral Document.

            (b) Each Pledgor hereby authorizes the Collateral Trustees to file
one or more financing or continuation statements, and amendments thereto,
relative to all or any part of the Collateral without the signature of such
Pledgor where permitted by law. A photocopy or other reproduction of this
Agreement, any Collateral Document or any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing statement
where permitted by law.

            (c) Each Pledgor will furnish such information about the Collateral
as the Collateral Trustees may reasonably request from time to time.

                                  ARTICLE VII

                             THE COLLATERAL TRUSTEE

            SECTION 7.01. DECLARATION OF TRUST. Each of the Corporate Trustee
and the Individual Trustee, for itself and its successors, hereby accepts the
trusts created by this Agreement upon the terms and conditions hereof, including
those contained in this Article VII. Further, each of the Corporate Trustee and
the Individual Trustee, for itself and its successors, does hereby declare that
it will hold all of the estate, right, title and interest in (a) the Collateral
Trust Estate and the Collateral Account for the equal and ratable benefit of the
Representatives and the Secured Holders as provided herein, and (b) each account
as may be established pursuant to Section 5.02 at the request of a
Representative upon the trust herein set forth and for the benefit of such
Representative on behalf of its applicable Secured Holders as provided herein.

            SECTION 7.02. EXCULPATORY PROVISIONS. (a) The Collateral Trustees
shall not be responsible in any manner whatsoever for the correctness of any
recitals, statements, representations or warranties contained herein or in the
Collateral Documents, all of which are made solely by the Pledgors which are a
party thereto. The Collateral Trustees make no representations as to the value
or condition of the Collateral Trust Estate, the Collateral Account or any part
thereof, or as to the title of any Pledgor thereto or as to the security
afforded by the Collateral Documents or this Agreement, or as to the validity,
execution (except its own execution), enforceability, legality or sufficiency of
this Agreement, any Collateral Document or any Secured Agreement, and the
Collateral Trustees shall incur no liability or responsibility in respect of any
such matters. The Collateral Trustees shall not be responsible for insuring the
Collateral Trust Estate or for the payment of taxes, charges, assessments or
liens upon the Collateral Trust Estate or otherwise as to the maintenance of the
Collateral Trust Estate or the Collateral Account, except that in any event that
any Collateral Trustee enters into possession of

                                       20
<PAGE>

a part or all of the Collateral Trust Estate, the Collateral Account, such
Collateral Trustee, shall preserve the part in its possession.

            (b) The Collateral Trustees shall not be required to ascertain or
inquire as to the performance by the Borrowers of any of the covenants or
agreements contained herein, in any other Collateral Document or in any Secured
Agreement.

            SECTION 7.03. DELEGATION OF DUTIES. The Collateral Trustees may
execute any of the trusts or powers hereof and perform any duty hereunder either
directly or by or through agents or attorneys-in-fact (which shall not include
officers and employees of any Pledgor or any Affiliate of any Pledgor). The
Collateral Trustees shall be entitled to rely upon advice of counsel and other
professionals concerning all matters pertaining to such trusts, powers and
duties. The Collateral Trustees shall not be responsible for the negligence or
misconduct of any agents or attorneys-in-fact reasonably selected by them in
good faith.

            SECTION 7.04. RELIANCE BY COLLATERAL TRUSTEES. (a) Whenever in the
administration of the trusts of this Agreement or, pursuant to any other
Collateral Document, the Collateral Trustees shall deem it necessary or
desirable that a matter be proved or established in connection with the taking,
suffering or omitting any action hereunder by the Collateral Trustees unless
otherwise provided herein, such matter (unless other evidence in respect thereof
be 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 Collateral Trustees and the Representatives, and such certificate shall
constitute a full warranty to the Collateral Trustees for any action taken,
suffered or omitted in reliance thereon unless (i) the Collateral Trustees shall
have actual knowledge of an inaccuracy therein or (ii) any Representative shall
provide contrary information with respect to such matter within 10 days of
receipt thereof by such Representative, in which case unless such Representative
and USI can reach agreement on such issue within a period of 10 days, the
Collateral Trustees shall appoint, at the expense of the Borrowers, an
independent arbitrator (who shall be reasonably acceptable to USI and such
Representative) to resolve the dispute.

            (b) The Collateral Trustees may consult with independent counsel
(excluding, counsel to or any employee of any Pledgor or any Affiliate of any
Pledgor), and any opinion of such counsel shall be full and complete
authorization and protection in respect of any action taken or suffered by them
hereunder in accordance therewith unless such Collateral Trustee has actual
knowledge of a reason to question the validity or accuracy of such opinion or of
any assumptions expressed therein as the basis for such opinion. The Collateral
Trustees shall have the right at any time to seek instructions concerning the
administration of the Collateral Trust Estate or the Collateral Account or any
account established pursuant to Section 5.02 hereof from any court of competent
jurisdiction.

            (c) The Collateral Trustees 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
they reasonably believe to be genuine and to have been signed or presented by
the proper party or parties or, in the case of telecopies and telexes, to have
been sent by the proper party or parties. In the absence of its gross negligence
or willful misconduct, each Collateral Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed therein,
upon any notices, certificates or opinions

                                       21
<PAGE>

furnished to such Collateral Trustee that conform to the requirements of this
Agreement or any Collateral Document.

            SECTION 7.05. LIMITATIONS ON DUTIES OF THE TRUSTEES. (a) The
Collateral Trustees undertake to perform only the duties expressly set forth
herein and no implied covenant or obligation shall be read into this Agreement
against the Collateral Trustees.

            (b) The Collateral Trustees may exercise the rights and powers
granted to them by this Agreement and the Collateral Documents, but only
pursuant to the terms of this Agreement, and the Collateral Trustees shall not
be liable with respect to any action taken or omitted by them in accordance with
the direction of the Required Representatives.

            (c) Except as herein otherwise expressly provided, the Collateral
Trustees shall not be under any obligation to take any action which is
discretionary with the Collateral Trustees under the provisions hereof or under
any Collateral Document except upon the written request of the Required
Representatives. The Collateral Trustees shall make available for inspection and
copying by each Representative each certificate or other paper furnished to the
Collateral Trustees by any Pledgor, by any Representative, or by any other
Person, under or in respect of this Agreement, any Collateral Document or any of
the Collateral Trust Estate.

            (d) The Collateral Trustees shall be under no obligation to exercise
any of the rights or powers vested in them by this Agreement or any other
Collateral Document at the request or direction of any Representatives pursuant
to this Agreement, unless such Representatives shall have offered to the
Collateral Trustees security or indemnity satisfactory to the Collateral
Trustees against the costs, expenses and liabilities which might be incurred by
them in compliance with such request or direction.

            SECTION 7.06. MONEYS TO BE HELD IN TRUST. All moneys received by the
Corporate Trustee under or pursuant to any provision of this Agreement or any
Collateral Document shall be segregated and held in trust for the purposes for
which they were paid or are held and the Corporate Trustee shall exercise
ordinary care in the handling of any such moneys actually received by it. The
Individual Trustee shall promptly turn over to the Corporate Trustee any
Collateral, or any part thereof, delivered to or received by the Individual
Trustee.

            SECTION 7.07. RESIGNATION AND REMOVAL OF COLLATERAL TRUSTEES. (a)
Each or both of the Collateral Trustees may at any time, by giving 30 days'
prior written notice to USI and the Representatives, resign and be discharged of
their responsibilities hereby created, such resignation to become effective upon
the appointment of a successor trustee or trustees by the Required
Representatives, the acceptance of such appointment by such successor trustee or
trustees and, unless an Actionable Default has occurred and is continuing, the
consent to the appointment of such successor trustee or trustees by USI. Either
or both of the Collateral Trustees may be removed at any time (with or without
cause) and a successor trustee or trustees appointed by the affirmative vote of
the Required Representatives, subject to, unless an Actionable Default has
occurred and is continuing, the consent of USI, PROVIDED that the Collateral
Trustees or either of them shall be entitled to their fees and expenses accrued
to the date of removal. If either or both of the Collateral Trustees resigns or
is removed as provided in this Section 7.07 the consent to the appointment of a
successor trustee or trustees shall not be unreasonably withheld and shall be
deemed to have been given if USI shall not have reasonably

                                       22
<PAGE>

objected to any proposed successor trustee or trustees within five Business Days
of receipt of notice of the identity thereof from the Representatives. If no
successor trustee or trustees shall be appointed and approved within 30 days
from the date of the giving of the aforesaid notice of resignation or within 30
days from the date of such vote for removal, the Collateral Trustees, shall, or
any Representative may, apply to any court of competent jurisdiction to appoint
a successor trustee or trustees to act until such time, if any, as a successor
trustee or trustees shall have been appointed as above provided. Any successor
trustee or trustees so appointed by such court shall immediately and without
further act be superseded by any successor trustee or trustees approved by the
Representatives as above provided.

            (b) If at any time either or both of the Collateral Trustees shall
become incapable of acting, or if at any time a vacancy shall occur in the
office of the Collateral Trustees for any other cause, a successor trustee or
trustees shall be appointed by the Required Representatives, subject to, unless
an Actionable Default has occurred and is continuing, the consent of USI, which
consent shall not be unreasonably withheld, and the powers, duties, authority
and title of the predecessor trustee or trustees terminated and cancelled
without procuring the resignation of such predecessor trustee or trustees, and
without any formality (except as may be required by applicable law) other than
appointment and designation of a successor trustee or trustees in writing, duly
acknowledged, delivered to the predecessor trustee or trustees and USI and filed
for record in each public office, if any, in which this Agreement is required to
be filed.

            (c) The appointment and designation referred to in Section 7.07(b)
shall, after any required filing, be full evidence of the right and authority to
make the same and of all the facts therein recited, and this Agreement shall
vest in such successor trustee or trustees, without any further act, deed or
conveyance, all of the estate and title of its predecessor, and upon such filing
for record the successor trustee or trustees shall become fully vested with 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 Required Representatives, USI or its successor trustee or
trustees, 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 shall deliver all securities and moneys held by
it or them to such successor trustee or trustees. Should any deed, conveyance or
other instrument in writing from any Pledgor be required by any successor
trustee or trustees for more fully and certainly vesting in such successor
trustee or trustees the estates, properties, rights, powers, trusts, duties,
authority and title vested or intended to be vested in the predecessor trustee
or trustees, any and all such deeds, conveyances and other instruments in
writing shall, on request of such successor trustee or trustees, be executed,
acknowledged and delivered by such Pledgor.

            (d) Any required filing for record of the instrument appointing a
successor trustee or trustees as hereinabove provided shall be at the expense of
the Borrowers. The resignation of any trustee or trustees and the instrument
removing any trustee or trustees, together with all other instruments, deeds and
conveyances provided for in this Article VII shall, if permitted by law, be
forthwith recorded, registered and filed by and at the expense of the Borrowers,
wherever this Agreement is recorded, registered and filed.

            SECTION 7.08. STATUS OF SUCCESSORS TO TRUSTEE. Every successor to
the Corporate Trustee appointed pursuant to Section 7.07 shall be a bank or
trust company in good standing and having power so to act, incorporated under
the laws of the United States or any

                                       23
<PAGE>

State thereof or the District of Columbia and having its principal corporate
trust office within the State of Delaware, or another state acceptable to the
Required Representatives, and shall also have capital, surplus and undivided
profits of not less than $100,000,000, if there be such an institution with such
capital, surplus and undivided profits willing, qualified and able to accept the
trust upon reasonable or customary terms. Any successor to the Individual
Trustee appointed pursuant to Section 7.07 shall be an individual residing in
the State of Delaware, the State of New York or another state of the United
States acceptable to the Required Representatives.

            SECTION 7.09. MERGER OF THE CORPORATE TRUSTEE. Any corporation into
which the Corporate Trustee may be merged, or with which it may be consolidated,
or any corporation resulting from any merger or consolidation to which the
Corporate Trustee shall be a party, shall be the Corporate Trustee under this
Agreement without the execution or filing of any paper or any further act on the
part of the parties hereto.

            SECTION 7.10. POWERS OF INDIVIDUAL TRUSTEE. The Individual Trustee
has been joined as a party hereunder so that if, by any present or future
applicable law in any jurisdiction in which it may be necessary to perform any
act in the execution or enforcement of the trusts hereby created, the Corporate
Trustee may be incompetent, unqualified or unable to act as a Collateral
Trustee, then all of the acts required to be performed in such jurisdiction, in
the execution or enforcement of the trusts hereby created, shall and will be
performed by the Individual Trustee, acting alone. Notwithstanding any other
term or provision of this Agreement to the contrary, the Corporate Trustee alone
shall have and exercise the rights and powers granted herein and shall be solely
charged with the performance of the duties herein declared on the part of the
Collateral Trustees to be had and exercised or to be performed without any
action taken by the Individual Trustee; PROVIDED, HOWEVER, that if the Corporate
Trustee or the Required Representatives deem it necessary or desirable for the
Individual Trustee to act in a particular jurisdiction, the Individual Trustee
shall have and exercise the rights and powers granted herein (but no greater
powers) and shall be charged with the performance of the duties herein declared
on the part of the Collateral Trustees to be had and exercised or to be
performed, but only in such particular jurisdiction.

            SECTION 7.11. ADDITIONAL CO-TRUSTEES; SEPARATE TRUSTEES. (a) If at
any time or times it shall be necessary or prudent in order to conform to any
law of any jurisdiction in which any of the Collateral shall be located, or the
Collateral Trustees shall be advised by counsel satisfactory to them that it is
so necessary or prudent in the interest of the Representatives on behalf of the
Secured Holders, or the Representatives shall in writing so request by notice to
the Collateral Trustees and USI, or the Collateral Trustees shall deem it
desirable for their own protection in the performance of their duties hereunder,
or USI shall in writing so request by notice to the Collateral Trustees with the
consent of the Representatives, the Collateral Trustees and USI shall execute
and deliver all instruments and agreements necessary or proper to constitute
another bank or trust company, or one or more persons approved by the Collateral
Trustees, USI and the Representatives, either to act as co-trustee or
co-trustees of all or any of the Collateral, jointly with the Collateral
Trustees originally named herein or any successor, or to act as separate trustee
of any such property. In the event USI shall not have joined in the execution of
such instruments and agreements within 10 days after the receipt of a written
request from the Collateral Trustees so to do, or in case an Actionable Default
shall have occurred and be continuing, the Collateral Trustees may act under the
foregoing provisions of

                                       24
<PAGE>

this Section 7.11 without the concurrence of USI or any other Pledgor (but with
the concurrence of the Required Representatives), and each Pledgor hereby
appoints the Collateral Trustees as its agents and attorneys to act for it under
the foregoing provisions of this Section 7.11 in either of such contingencies.

            (b) Any separate trustee and any co-trustee (other than any trustee
which may be appointed as successor to the Corporate Trustee or the Individual
Trustee pursuant to Section 7.07) shall, to the extent permitted by law, be
appointed and act and be such, subject to the following provisions and
conditions, namely:

            (i) all rights, powers, duties and obligations conferred upon the
      trustees in respect of the custody, control and management of moneys,
      papers or securities shall be exercised solely by the Collateral Trustees
      originally named herein or their successors appointed pursuant to Section
      7.07;

            (ii) all rights, powers, duties and obligations conferred or imposed
      upon the Collateral Trustees hereunder shall be conferred or imposed and
      exercised or performed by the Collateral Trustees and such separate
      trustee or co-trustee, jointly, as shall be provided in the instrument
      appointing such separate trustee or co-trustee, except to the extent that
      under any law of any jurisdiction in which any particular act or acts are
      to be performed the Collateral Trustees shall be incompetent or
      unqualified to perform such act or acts, in which event such rights,
      powers, duties and obligations shall be exercised and performed by such
      separate trustee or co-trustee;

            (iii) no power given hereby to, or which it is provided hereby may
      be exercised by, any such co-trustee or separate trustee, shall be
      exercised hereunder by such co-trustee or separate trustee, except jointly
      with, or with the consent in writing of, the Collateral Trustees, anything
      herein contained to the contrary notwithstanding;

            (iv) no trustee hereunder shall be personally liable by reason of
      any act or omission of any other trustee hereunder; and

            (v) USI and the Collateral Trustees, at any time, by an instrument
      in writing, executed by them jointly, may accept the resignation of or
      remove any such separate trustee, and in that case, by an instrument in
      writing executed by USI and the Collateral Trustees jointly, may appoint a
      successor (who shall be acceptable to the Required Representatives) to
      such a separate trustee or co-trustee, as the case may be, anything herein
      contained to the contrary notwithstanding. In the event that USI shall not
      have joined in the execution of any such instrument within 10 days after
      the receipt of a written request from the Collateral Trustees so to do, or
      in case an Actionable Default shall have occurred and be continuing, the
      Collateral Trustees shall have the power to accept the resignation of or
      remove any such separate trustee or co-trustee and to appoint (with the
      consent of the Required Representatives) a successor without the
      concurrence of USI or any other Pledgor and each Pledgor hereby appoints
      the Collateral Trustees its agents and attorneys to act for it in such
      connection in either of such contingencies. In the event that the
      Collateral Trustees shall have appointed a separate trustee or co-trustee
      or as above provided, they may at any time, by an instrument in writing,
      accept the resignation of or remove any such separate trustee, the
      successor to any such separate

                                       25
<PAGE>

      trustee to be appointed by USI and the Collateral Trustees, or by the
      Collateral Trustees alone, as hereinbefore provided in this Section 7.11.

            SECTION 7.12. TRUSTEES APPOINTED ATTORNEYS-IN-FACT. Each Pledgor
hereby irrevocably constitutes and appoints the Collateral Trustees and any
officer or agent thereof, with full power of substitution, as its true and
lawful attorneys-in-fact with full power and authority in the name of such
Pledgor or their own name and in the place and stead of such Pledgor and in the
name of such Pledgor, from time to time at the direction of the Required
Representatives, to take, subject to Section 4.09, any action and to execute any
instrument which the same may deem necessary or advisable to accomplish the
purposes of this Agreement, including, without limitation, to receive, endorse
and collect all instruments made payable to such Pledgor representing any
dividend, interest payment or other distribution in respect of the Collateral or
any part thereof and to give full discharge for the same. Each Pledgor
acknowledges and agrees that the foregoing power of attorney is coupled with an
interest and may not be revoked or modified except with the consent of the
Collateral Trustees or as otherwise provided herein.

            SECTION 7.13. ORDINARY CARE. The Collateral Trustees shall be deemed
to have exercised ordinary care in the custody and preservation of the
Collateral in their possession if the Collateral is accorded treatment
substantially equal to that which the Collateral Trustees accord their own
property and reasonable care is exercised by the Collateral Trustees in handling
any moneys or securities or other property actually received by them, it being
understood that the Collateral Trustees shall not have any responsibility for
(i) ascertaining or taking action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relative to any Collateral, whether or not
the Collateral Trustees have or are deemed to have knowledge of such matters, or
(ii) taking any necessary steps to preserve rights against any parties with
respect to any Collateral.

                                  ARTICLE VIII

                              RELEASE OF COLLATERAL

            SECTION 8.01. PARTIAL RELEASE OF COLLATERAL. (a) Each Pledgor may,
from time to time so long as no Actionable Default shall have occurred and be
continuing, request the release of the lien and security interest of the
Collateral Documents in any portion of the Collateral of such Pledgor proposed
to be sold or otherwise disposed of by such Pledgor to any Person which is not a
Pledgor hereunder, upon notice to the Collateral Trustees (with a copy to the
5-Year Agent) from an Authorized Officer of USI (a "NOTICE OF PARTIAL RELEASE"),
which Notice of Partial Release shall be delivered to the Collateral Trustees at
least ten Business Days prior to the date of the proposed sale or other
disposition of such Collateral (unless a shorter period of time is acceptable to
the Collateral Trustees and the 5-Year Agent) and shall

            (i) specify the Collateral to be so sold or otherwise disposed of
      and the proposed date of such sale or other disposition, and

            (ii) certify that the sale of other disposition of such Collateral
      is permitted under the terms of the Credit Agreements, and the Borrowers
      are not, and after giving effect to such release, would not be, in default
      under any of the Secured Agreements.

                                       26
<PAGE>

If a Notice of Partial Release is delivered to the Collateral Trustees in
accordance with the immediately preceding sentence and the 5-Year Agent, on
behalf of the 5-Year Credit Parties, shall not have objected thereto prior to
the date of the proposed release, the Collateral Trustees shall execute and
deliver to USI, on the date of the proposed release (or as promptly thereafter
as possible), a release or releases (including, without limitation, Uniform
Commercial Code release statements and instruments of satisfaction, discharge
and/or reconveyance) in recordable form as to the Collateral specified in such
Notice of Partial Release from the liens, security interests, conveyances and
assignments evidenced by the Collateral Documents, which release shall state
that it is effective as of the date of such disposition; PROVIDED, HOWEVER,
that, if prior to the time that the Collateral Trustees deliver a release
pursuant to this Section 8.01(a), the Collateral Trustees shall have received
either (A) an Actionable Default Notice that shall not have been withdrawn prior
to such time and the Required Representatives shall have directed the Collateral
Trustees either not to deliver such a release or not to deliver releases
generally or (B) a written objection from the 5-Year Agent stating that such
sale or other disposition is not permitted under the Credit Agreements, then, in
either case, the Collateral Trustees shall so notify USI and shall not sign any
release or releases in connection with such disposition.

            (b) If, at any time, the Collateral Trustees shall receive a notice
from an Authorized Officer of USI, (i) stating that any promissory note or other
similar or related instrument evidencing obligations payable to any Pledgor and
included in the Collateral has been paid in full in accordance with its terms
(or will be so paid concurrently with the surrender thereof), and (ii)
identifying such note or other instrument in reasonable detail (including,
without limitation, by its date of issuance, the name of its payee and the
principal amount thereof), then the Collateral Trustees shall promptly deliver a
copy of each such notice to each Representative and, unless any Representative
shall have disputed the accuracy of such notice within five Business Days of the
delivery of such notice, the Collateral Trustees shall promptly deliver such
note or other instrument to USI, and execute and deliver a release or releases
(including, without limitation, Uniform Commercial Code release statements) in
recordable form as to any such note or other instrument from the liens, security
interests, conveyances and assignments evidenced by the Collateral Documents,
which release shall state that it is effective as of the date of its delivery.

            SECTION 8.02. FULL RELEASE OF COLLATERAL UPON SATISFACTION OF
CERTAIN SECURED OBLIGATIONS. (a) Unless an Actionable Default shall then have
occurred and be continuing, the Collateral Trustees shall promptly release in
accordance with Section 8.03 all the Collateral upon the cash payment in full of
the Secured Obligations arising under the Credit Agreements and the other Loan
Documents (as defined in the Credit Agreements).

            (b) In furtherance of the undertaking set forth above in Section
8.02(a), the Collateral Trustees shall, upon the request of USI accompanied by a
certificate of an Authorized Officer of USI, upon which the Collateral Trustees
may conclusively rely without independent verification, to the effect that all
Secured Obligations under the Credit Agreements and the other Loan Documents (as
defined in the Credit Agreements) have been, or will, concurrently with the
release of the Collateral be, paid in full in cash and all commitment thereunder
terminated (and if such Secured Obligations have not previously been so paid,
describing the source(s) of funds for such repayment), deliver a notice to the
5-Year Agent and the 364-Day Agent (with a copy to each other Representative)
containing the following:

                                       27
<PAGE>

            (i) a statement as to the total amount of moneys in the Collateral
      Account and any account which has been established at the request of any
      Representative pursuant to Section 5.02; and

            (ii) a statement that the Collateral Trustees intend to release all
      the Collateral unless they receive a notice from the 5-Year Agent or the
      364-Day Agent within 10 days saying that it has not received cash payment
      in full of all the Secured Obligations owed to the 5-Year Credit Parties
      under the 5-Year Credit Agreement or the 364-Day Credit Parties under the
      364-Day Credit Agreement, as the case may be, and that all commitments of
      such Credit Parties thereunder have not been terminated, or, if such
      Secured Obligations are to be repaid and such commitments terminated
      concurrently with such release, a statement that the Collateral Trustees
      will release such Collateral only upon receipt from the 5-Year Agent
      and/or the 364-Day Agent of instructions to do so.

If the Collateral Trustees do not receive a certificate from the 5-Year Agent or
the 364-Day Agent within 10 days after the delivery of such notice stating that
such Secured Obligations have not been indefeasibly paid in full in cash (or
such commitments have not been terminated), or the Collateral Trustees receive a
direction from the 5-Year Agent and the 364-Day Agent so to release such
Collateral, as the case may be (and the Collateral Trustees shall not have
received any notice that an Actionable Default has occurred or is continuing),
then the Collateral Trustees shall release all the Collateral from the security
interest in their favor and deliver to the Pledgors all Collateral in the
possession of the Collateral Trustees promptly after the expiration of such 10
day period or as specified in such instruction, as the case may be; PROVIDED,
HOWEVER, that the Borrowers shall have made adequate provision for the expenses
of the Collateral Trustees associated with such release of Collateral and all
other expenses of, or payable to, the Collateral Trustees hereunder; and
PROVIDED, FURTHER, that the failure of the 5-Year Agent or the 364-Day Agent to
provide a certificate to the Collateral Trustees pursuant to this Section 8.02
shall in no way be deemed a waiver of, or otherwise impair in any way, its
rights to receive payment in respect of unpaid Secured Obligations. If the
Collateral Trustees shall have received such a certificate from the 5-Year Agent
or the 364-Day Agent within such 10 day period, or shall not have received an
instruction so to release such Collateral, (or shall have received an Actionable
Default Notice which has not been withdrawn), as the case may be, the Collateral
Trustees shall not release the Collateral unless and until the 5-Year Agent and
the 364-Day Agent or a court of competent jurisdiction so directs the Collateral
Trustees pursuant to a final, non-appealable judgment (including a judgment that
becomes non-appealable by reason of expiration of any period of time limiting
the right to appeal therefrom).

            SECTION 8.03. EFFECT OF RELEASE OF COLLATERAL. Upon the
effectiveness of the release of the Collateral pursuant to Section 8.02, all
right, title and interest of the Collateral Trustees and the Representatives on
behalf of the Secured Holders in, to and under the Collateral Trust Estate, the
Collateral and the Collateral Documents shall terminate and shall revert to the
applicable Pledgor and its successors and assigns, and the estate, right, title
and interest of the Collateral Trustees therein shall thereupon cease; and in
such case, upon the written request of USI, its successors or assigns, and at
the cost and expense of the Borrowers, their successors or assigns, the
Collateral Trustees shall execute and deliver a satisfaction of the Collateral
Documents and such instruments as are necessary or desirable to terminate and
remove of record any documents constituting public notice of the Collateral
Documents and the security interests

                                       28
<PAGE>

granted thereunder and shall transfer, or cause to be transferred, and shall
deliver or cause to be delivered to USI on behalf of the Pledgors, all property,
including all moneys, instruments and securities of the Pledgors then held by
the Collateral Trustees. The cancellation and satisfaction of the Collateral
Documents shall be without prejudice to the rights of the Collateral Trustees or
any successor trustee or trustees to charge and be reimbursed for any
expenditures which they may thereafter incur in connection therewith.

                                   ARTICLE IX

                                  MISCELLANEOUS

            SECTION 9.01. AMENDMENTS, SUPPLEMENTS AND WAIVERS. (a) (i) With the
written consent of the 5-Year Agent, the 364-Day Agent and the Corporate
Trustee, the Pledgors may, from time to time, enter into written agreements
supplemental hereto for the purpose of adding to or waiving any provision of
this Agreement or any of the Collateral Documents or changing in any manner the
rights of the Collateral Trustees, the Representatives, the Secured Holders and
the Pledgors hereunder or thereunder.

            (i) No such amendment, waiver or consent shall, unless in writing
and signed by the Individual Trustee, amend, waive or otherwise modify any
provision of Section 7.10.

            (ii) Any such supplemental agreement shall be binding upon the
Pledgors, the Representatives, the Secured Holders and the Collateral Trustees
and their respective successors.

            (iii) The Collateral Trustees shall not enter into any such
supplemental agreement unless they shall have received a certificate of an
Authorized Officer of USI to the effect that such supplemental agreement will
not result in a breach of any provision or covenant contained in any of the
Secured Agreements.

            (b) Notwithstanding the provisions of paragraph (a), the Collateral
Trustees and USI may, at any time and from time to time, without the consent of
the 5-Year Agent, the 364-Day Agent and any other Representative or any Secured
Holders, enter into additional Collateral Documents or one or more agreements
supplemental hereto or to any Collateral Document, in form satisfactory to the
Collateral Trustees,

            (i) to add to the covenants of the Pledgors, for the benefit of the
      Representatives or any Secured Holder, or to surrender any right or power
      herein conferred upon any Pledgor;

            (ii) to mortgage, pledge or grant a security interest in favor of
      the Collateral Trustees as additional security for the Secured Obligations
      any property or assets which are required to be mortgaged or pledged, or
      in which a security interest is required to be granted, to the Collateral
      Trustees pursuant to any Collateral Document or otherwise; or

            (iii) to cure any ambiguity, to correct or supplement any provision
      herein which may be inconsistent with any other provision herein, or to
      make any other provisions with respect to matters or questions arising
      under this Agreement which shall

                                       29
<PAGE>

      not be inconsistent with the provisions of this Agreement, provided such
      action shall not adversely affect the interests of the Secured Holders.

            SECTION 9.02. ADDITIONAL ACTIONS OF REPRESENTATIVES. Whether or not
there shall be an Actionable Default, the Collateral Trustees shall comply and
shall be fully protected in complying with any reasonable request of (a) the
Required Representatives, to take or refrain from taking certain actions with
respect to the Collateral or the Representatives, and (b) more than 50% of the
Secured Holders represented by any Representative which has requested that an
account be opened pursuant to Section 5.02, to take or refrain from taking
certain actions with respect to such account, PROVIDED, in each case, that the
Collateral Trustees shall not take or refrain from taking such actions if to do
so would violate applicable law or the terms of this Agreement, the Collateral
Documents or the applicable Secured Agreements or if the Collateral Trustees
shall not be indemnified as provided in Section 6.06(b).

            SECTION 9.03. NOTICES. All notices, requests, demands and other
communications provided for or permitted hereunder shall, unless otherwise
stated herein, be in writing (including telex and telecopy communications) and
shall be sent by mail (by registered or certified mail, return receipt
requested), telex, telecopier or hand delivery:

            (a) If to USI or any other Pledgor, to its address at 101 Wood
      Avenue, South Iselin, NJ 08830, Attention: Chief Financial Officer
      (telecopy no. (732)-767-2390) with a copy to Cadwalader, Wickersham & Taft
      at 100, Maiden Lane, New York N.Y. 10038, attention to Dennis J. Block
      Esq. (telecopy no. (212) 504-6666) or at such other address as shall be
      designated by it in a written notice to the Collateral Trustees;

            (b) If to the Corporate Trustee, at Rodney Square North, 1100 North
      Market St., Wilmington, DE 19890, Attention: Corporate Trust Division, or
      at such other address as shall be designated by it in a written notice to
      USI and each Representative, with a copy to the Individual Trustee, at
      1100 North Market St. Rodney Square North Wilmington, DE 19890, or at such
      other address as shall be designated by him in a written notice to USI and
      each Representative; PROVIDED that failure to send a copy of any notice to
      the Individual Trustee shall not render any notice to the Collateral
      Trustees ineffective; and

            (c) If to any Representative, to it at the address specified from
      time to time in the list provided by USI to the Collateral Trustees
      pursuant to Section 6.02 with copies to whomever (other than USI) is
      specified by USI pursuant to Section 6.02 as a Person to whom notice must
      be sent under the Secured Agreements, PROVIDED that in the case that no
      address is known for a Representative, notice shall be given to it in the
      manner specified by the related Secured Agreement, and, in the absence of
      any such specified means of giving notice, by such notice in the national
      edition of THE WALL STREET JOURNAL or as the Collateral Trustees shall
      determine to be reasonable. For purposes of notice by publication, one
      notice is sufficient and shall be deemed made on the date of its
      publication.

All such notices, requests, demands and communications shall be deemed to have
been duly given or made, (i) when delivered by hand, (ii) five Business Days
after being deposited in the mail, postage prepaid, (iii) when telexed with
answerback received, (iv) when telecopied or (v)

                                       30
<PAGE>

when published in THE WALL STREET JOURNAL or such other publication; PROVIDED,
HOWEVER, that any notice, request, demand or other communication to the
Collateral Trustees shall not be effective until received by the Corporate
Trustee and, PROVIDED, FURTHER, that any notice to the Collateral Trustees from
any Pledgor shall be signed by an Authorized Officer, unless otherwise
specifically set forth herein.

            SECTION 9.04. HEADINGS. Section, subsection and other headings used
in this Agreement are for convenience only and shall not affect the construction
of this Agreement.

            SECTION 9.05. 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 9.06. TREATMENT OF PAYEE OR INDORSEE BY TRUSTEES. (a) The
Collateral Trustees may treat the registered Secured Holder of any registered
note, and the payee or indorsee of any note or debenture which is not
registered, as the absolute owner thereof for all purposes hereunder and shall
not be affected by any notice to the contrary, whether such promissory note or
debenture shall be past due or not.

            (b) Any person, firm, corporation or other entity which shall be
designated as the duly authorized representative of one or more Representatives
to act as such in connection with any matters pertaining to this Agreement or
any Collateral Document or the Collateral shall present to the Collateral
Trustees such documents, including, without limitation, opinions of counsel, as
the Collateral Trustees may reasonably require, in order to demonstrate to the
Collateral Trustees the authority of such person, firm, corporation or other
entity to act as the representative of such Representatives.

            SECTION 9.07. DEALINGS WITH THE PLEDGORS. (a) Upon any application
or demand by USI to the Collateral Trustees to take or permit any action under
any of the provisions of this Agreement, USI shall (unless otherwise waived by
the Collateral Trustees in writing) furnish to the Collateral Trustees a
certificate signed by an Authorized Officer stating that all conditions
precedent, if any, provided for in this Agreement relating to the proposed
action have been complied with, except that in the case of any such application
or demand as to which the furnishing of such documents is specifically required
by any provision of this Agreement relating to such particular application or
demand, no additional certificate or opinion need be furnished.

            (b) Any opinion of counsel may be based, insofar as it relates to
factual matters which were not independently established by counsel, upon a
certificate of USI furnished to the Collateral Trustees.

            SECTION 9.08. CLAIMS AGAINST TRUSTEE. This Agreement is made for the
benefit of the Representatives on behalf of the Secured Holders, and the
Representatives may from time to time enforce their rights as explicit
beneficiaries hereunder.

            SECTION 9.09. BINDING EFFECT. This Agreement shall be binding upon
and inure to the benefit of each of the parties hereto and shall inure to the
benefit of the Representatives on behalf of the Secured Holders and their
respective successors and assigns and nothing herein or

                                       31
<PAGE>

in any Collateral Document is intended or shall be construed to give any other
Person any right, remedy or claim under, to or in respect of this Agreement, any
Collateral Document, the Collateral, the Collateral Account or the Collateral
Trust Estate or any part thereof.

            SECTION 9.10. GOVERNING LAW. The provisions of this Agreement
creating a trust for the benefit of the Representatives on behalf of the Secured
Holders and setting forth the rights, duties, obligations and responsibilities
of the Collateral Trustees hereunder shall be governed by and construed in
accordance with the laws of the State of Delaware, so long as Wilmington Trust
Company shall serve as Corporate Trustee hereunder. In all other respects,
including, without limitation, all matters governed by the Uniform Commercial
Code, and if Wilmington Trust Company shall cease to serve as Corporate Trustee
hereunder, this Agreement shall be governed by and construed in accordance with
the laws of the State of New York, except as otherwise required by mandatory
provisions of law.

            SECTION 9.11. EFFECTIVENESS. This Agreement shall become effective
on the execution and delivery hereof and shall remain in effect so long as the
Collateral Trustees shall have any obligations hereunder.

            SECTION 9.12. REEXECUTION OF AGREEMENT. This Agreement shall be
reexecuted at any time and from time to time, at the request of the Required
Representatives, with such changes in the form hereof (including, without
limitation, changes on the cover page and adding supplemental signatures and
notary statements) as may be necessary to comply with the filing or recording
requirements of any jurisdiction where this Agreement is to be filed.

            SECTION 9.13. EFFECT ON CREDIT AGREEMENTS. Nothing in this Agreement
shall operate or be deemed to prevent any amendment, modification or waiver of
the Credit Agreements or other Loan Documents (as defined in the Credit
Agreements) by the parties thereto in accordance with the terms thereof.

            SECTION 9.14. COUNTERPARTS. This Agreement may be executed in
separate counterparts, each of which shall be an original and all of which taken
together shall constitute one and the same instrument.

            SECTION 9.15. ADDITIONAL PLEDGORS. Upon the execution and delivery
by any Subsidiary of USI of a supplement to this Agreement in substantially the
form of Exhibit A hereto pursuant to Section 7.13 of either Credit Agreement or
otherwise, (a) such Subsidiary shall be referred to as an additional "Pledgor"
hereunder, and each reference herein and in the other Collateral Documents to a
"Pledgor" shall also mean and be a reference to such Subsidiary of USI, and (b)
each reference to this "Agreement", "hereunder", "hereof" or words of like
import referring to this Agreement, and each reference in the other Collateral
Documents to the "Collateral Trust Agreement", "thereunder", "thereof" or words
of like import referring to this Agreement, shall mean and be a reference to
this Agreement as supplemented by such supplement.

                                      * * *

                                       32
<PAGE>

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

Corporate Trustee:                        WILMINGTON TRUST COMPANY

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

Individual Trustee:
                                          ------------------------------------
                                          David A. Vanaskey

                                          AMES TRUE TEMPER PROPERTIES, INC.
                                          AMES TRUE TEMPER, INC.
                                          ARCHITECTURAL AREA LIGHTING, INC.
                                          ARROW CONSOLIDATED CORPORATION
                                          ASTERIA COMPANY
                                          BATHCRAFT INC.
                                          BAYLIS BROTHERS, INC.
                                          BRUCKNER MANUFACTURING CORP.
                                          CARLSBAD CORP.
                                          COLUMBIA LIGHTING, INC.
                                          COLUMBIA LIGHTING-LCA, INC.
                                          COLUMBIA LIGHTING MFG., CO.
                                          COLUMBIA LIGHTING PROPERTIES, INC.
                                          COLUMBIA MATERIALS, LLC
                                          COMPAX CORP.
                                          DUAL-LITE  INC.
                                          DUAL-LITE MANUFACTURING, INC.
                                          ELJER INDUSTRIES, INC.
                                          ELJER PLUMBINGWARE, INC.
                                          ENVIRONMENTAL ENERGY COMPANY
                                          EZ HOLDINGS, INC.
                                          GARY CONCRETE PRODUCTS, INC.
                                          GATSBY SPAS, INC.
                                          HL CAPITAL CORP.
                                          IXL MANUFACTURING COMPANY, INC.
                                          JACUZZI INC.
                                          JACUZZI WHIRLPOOL BATH, INC.
                                          JUSI HOLDINGS, INC.
                                          KIM LIGHTING INC.
                                          KLI, INC.
                                          LCA GROUP INC.
                                          LCA (NS) INC.
                                          LIGHTING CORPORATION OF AMERICA, INC.
                                          LOKELANI DEVELOPMENT CORPORATION

                                       33
<PAGE>

                                          LUXOR INDUSTRIES, INC.
                                          MAILI KAI LAND DEVELOPMENT CORPORATION
                                          MOBILITE INC.
                                          NEPCO OF AUSTRALIA, INC.
                                          NEPCO OF CANADA, INC.
                                          NEPCO OF FORD HEIGHTS, INC.
                                          NEPCO OF FULTON, INC.
                                          NEPCO OF PAKISTAN, INC.
                                          NISSEN UNIVERSAL HOLDINGS INC.
                                          OUTDOOR PRODUCTS LLC
                                          PH PROPERTY DEVELOPMENT COMPANY
                                          PRESCOLITE  LITE  CONTROLS, INC.
                                          PRESCOLITE, INC.
                                          PROGRESS LIGHTING, INC.
                                          PROGRESSIVE LIGHTING, INC. (NC)
                                          PROGRESSIVE LIGHTING, INC. (SC)
                                          PROGRESS LIGHTING PROPERTIES, INC.
                                          REDMONT, INC.
                                          SANITARY-DASH MANUFACTURING CO., INC
                                          SELKIRK CANADA U.S.A., INC.
                                          SELKIRK EUROPE U.S.A., INC.
                                          SELKIRK, INC.
                                          SPAULDING LIGHTING, INC.
                                          STRATEGIC CAPITAL MANAGEMENT, INC.
                                          STREAMWOOD CORPORATION
                                          SUNDANCE SPAS, INC.
                                          TA LIQUIDATION CORP.
                                          TRIMFOOT CO.
                                          TT LIQUIDATION CORP.
                                          UGE LIQUIDATION INC.
                                          UNITED STATES BRASS CORP.
                                          U.S. INDUSTRIES, INC.
                                          USI AMERICAN HOLDINGS, INC.
                                          USI ATLANTIC CORP.
                                          USI CAPITAL, INC.
                                          USI FUNDING, INC.
                                          USI GLOBAL CORP.
                                          USI PROPERTIES, INC.
                                          USI REALTY CORP.
                                          ZURCO, INC.
                                          ZURNACQ OF CALIFORNIA, INC.
                                          ZURN (CAYMAN ISLANDS), INC.
                                          ZURN CONSTRUCTORS, INC.
                                          ZURN DEVCO, INC.

                                       34
<PAGE>

                                          ZURN EPC SERVICES, INC.
                                          ZURN GOLF HOLDING CORPORATION
                                          ZURN INDUSTRIES, INC.

                                          By
                                            ----------------------------------
                                             Name: Steven C. Barre
                                             Title:   Vice President

                                       35
<PAGE>

                                                                       Exhibit A

                      Collateral Trust Agreement Supplement

              [To be agreed on terms reasonably satisfactory to the
                           Required Representatives.]

<PAGE>

                           COLLATERAL TRUST AGREEMENT

                           dated as of April 30, 2001,

                                      among

                             U.S. INDUSTRIES, INC.,
                                USI GLOBAL CORP.,
                        USI AMERICAN HOLDINGS, INC., and
                    EACH OF THEIR SUBSIDIARIES PARTY HERETO,
                                  as Pledgors,

                                       and

                            WILMINGTON TRUST COMPANY
                              as Corporate Trustee

                                       and

                                DAVID A. VANASKEY
                              as Individual Trustee

<PAGE>

                                TABLE OF CONTENTS

                                    ARTICLE I

                                   DEFINITIONS

   SECTION 1.01. Certain Defined Terms.......................................3
   SECTION 1.02. Certain References..........................................8

                                   ARTICLE II

                 CONFIRMATION AND CREATION OF SECURITY INTERESTS

   SECTION 2.01. Collateral Trust Estate.....................................8
   SECTION 2.02. Security for Secured Obligations............................9

                                   ARTICLE III

                               COLLATERAL ACCOUNT

   SECTION 3.01. Collateral Account..........................................9

                                   ARTICLE IV

                          ACTIONABLE DEFAULTS; REMEDIES

   SECTION 4.01. Actionable Default Notice..................................10
   SECTION 4.02. Direction by Required Representatives......................11
   SECTION 4.03. Right to Initiate Judicial Proceedings, Etc................11
   SECTION 4.04. Remedies Not Exclusive.....................................12
   SECTION 4.05. Waiver of Certain Rights...................................12
   SECTION 4.06. Limitation on Collateral Trustees' Duties in Respect of
                Collateral..................................................13
   SECTION 4.07. Limitation by Law..........................................13
   SECTION 4.08. Absolute Rights of Secured Holders and Representatives.....13
   SECTION 4.09. Equal and Ratable Security.................................14

                                    ARTICLE V

                             APPLICATION OF PROCEEDS

   SECTION 5.01. Application of Proceeds....................................14
   SECTION 5.02. Application of Withheld Amounts............................15
   SECTION 5.03. Release of Amounts in Collateral Account...................16
   SECTION 5.04. Distribution Date..........................................16

                                        i
<PAGE>

                                   ARTICLE VI

                     AGREEMENTS WITH THE COLLATERAL TRUSTEE

   SECTION 6.01. Delivery of Agreements.....................................16
   SECTION 6.02. Information as to Representatives..........................16
   SECTION 6.03. Compensation and Expenses..................................17
   SECTION 6.04. Stamp and Other Similar Taxes..............................17
   SECTION 6.05. Filing Fees, Excise Taxes, Etc.............................18
   SECTION 6.06. Indemnification............................................18
   SECTION 6.07. Further Assurances.........................................18

                                   ARTICLE VII

                             THE COLLATERAL TRUSTEE

   SECTION 7.01. Declaration of Trust.......................................19
   SECTION 7.02. Exculpatory Provisions.....................................19
   SECTION 7.03. Delegation of Duties.......................................20
   SECTION 7.04. Reliance by Collateral Trustees............................20
   SECTION 7.05. Limitations on Duties of the Trustees......................21
   SECTION 7.06. Moneys to Be Held in Trust.................................21
   SECTION 7.07. Resignation and Removal of Collateral Trustees.............21
   SECTION 7.08. Status of Successors to Trustee............................23
   SECTION 7.09. Merger of the Corporate Trustee............................23
   SECTION 7.10. Powers of Individual Trustee...............................23
   SECTION 7.11. Additional Co-Trustees; Separate Trustees..................23
   SECTION 7.12. Trustees Appointed Attorneys-in-Fact.......................25
   SECTION 7.13. Ordinary Care..............................................25

                                  ARTICLE VIII

                              RELEASE OF COLLATERAL

   SECTION 8.01. Partial Release of Collateral..............................25
   SECTION 8.02. Full Release of Collateral Upon Satisfaction of Certain
                Secured Obligations.........................................26
   SECTION 8.03. Effect of Release of Collateral............................28

                                   ARTICLE IX

                                  MISCELLANEOUS

   SECTION 9.01. Amendments, Supplements and Waivers........................28
   SECTION 9.02. Additional Actions of Representatives......................29
   SECTION 9.03. Notices....................................................29
   SECTION 9.04. Headings...................................................30
   SECTION 9.05. Severability...............................................30
   SECTION 9.06. Treatment of Payee or Indorsee by Trustees.................30

                                       ii
<PAGE>

   SECTION 9.07. Dealings with the Pledgors.................................30
   SECTION 9.08. Claims Against Trustee.....................................31
   SECTION 9.09. Binding Effect.............................................31
   SECTION 9.10. Governing Law..............................................31
   SECTION 9.11. Effectiveness..............................................31
   SECTION 9.12. Reexecution of Agreement...................................31
   SECTION 9.13. Effect on Credit Agreements................................31
   SECTION 9.14. Counterparts...............................................31
   SECTION 9.15. Additional Pledgors........................................31

                                       iii<PAGE>

                                                                    EXHIBIT 10.7

                                                                       S&S DRAFT

                                                                         4/30/01

                          PLEDGE AND SECURITY AGREEMENT

            This PLEDGE AND SECURITY AGREEMENT dated as of April 30, 2001 (as
amended, amended and restated, supplemented or otherwise modified from time to
time, this "AGREEMENT"), among U.S. INDUSTRIES, INC. (formerly known as USI,
Inc.), a Delaware corporation ("USI"), USI GLOBAL CORP., a Delaware corporation
("USI GLOBAL"), USI AMERICAN HOLDINGS, INC., a Delaware corporation ("USI
AMERICAN"; USI, USI Global and USI American are each referred to herein,
individually, as a "BORROWER", and, collectively, as the "BORROWERS"), each
Subsidiary (as hereinafter defined) of USI which is listed on the signature
pages of this Agreement (together with the Borrowers, each, individually, an
"INITIAL PLEDGOR", and, collectively, the "INITIAL Pledgors"), each Subsidiary
of USI which hereafter becomes a party to this Agreement pursuant to Section
19(b) hereof (together with the Initial Pledgors, each, individually, a
"PLEDGOR" and, collectively, the "PLEDGORS"), [WILMINGTON TRUST COMPANY], a
Delaware banking corporation (together with any successor corporate trustee
appointed pursuant to Article 7 of the Collateral Trust Agreement referred to
below, the "CORPORATE TRUSTEE"), and [NAME OF INDIVIDUAL TRUSTEE], an individual
residing in the State of [Delaware] (together with any successor individual
trustee appointed pursuant to Article 7 of the Collateral Trust Agreement, the
"INDIVIDUAL TRUSTEE"; and, together with the Corporate Trustee, the "COLLATERAL
TRUSTEES"), the foregoing trustees being trustees for the Secured Holders (as
hereinafter defined).

                             PRELIMINARY STATEMENTS:

            (1) The Borrowers have entered into (i) a Credit Agreement dated as
of December 12, 1996 (as amended, supplemented or otherwise modified and in
effect on the date hereof and as the same may hereafter be further amended,
amended and restated, supplemented or otherwise modified from time to time, the
"5-YEAR CREDIT AGREEMENT"), with the 5-Year Credit Parties (as defined in the
Collateral Trust Agreement referred to below), and (ii) a Credit Agreement dated
as of the date hereof (as amended, supplemented or otherwise modified and in
effect on the date hereof and as the same may hereafter be further amended,
amended and restated, supplemented or otherwise modified from time to time, the
"364-DAY CREDIT AGREEMENT"; and together with the 5-Year Credit Agreement,
collectively, the "CREDIT AGREEMENTS"), with the 364-Day Credit Parties (as
defined in the Collateral Trust Agreement; and together with the 5-Year Credit
Parties, collectively, the "CREDIT Parties"). Each Pledgor which is a Subsidiary
of a Borrower will derive substantial direct or indirect benefit from the credit
extended to such Borrower pursuant to the Credit Agreements.

            (2) Pursuant to the Credit Agreements, each Borrower has agreed (i)
to grant to the Collateral Trustees for the benefit of the Credit Parties and
the other Secured Holders pursuant to the Collateral Documents (as defined in
the Collateral Trust Agreement) liens on and security interests in certain of
such Borrower's assets and property from time to time owned by it and (ii) to
cause its domestic Subsidiaries to grant to the Collateral Trustees for the
benefit of the Credit Parties and the other Secured Holders pursuant to the
Collateral Documents liens on and security interests in certain of such
Subsidiaries' assets and property from time to time owned by them.

<PAGE>
                                       2

            (3) USI, USI Global and USI American are joint and several
co-obligors with respect to those certain 7-1/4% Senior Notes due December 1,
2006 (as amended, supplemented or otherwise modified and in effect on the date
hereof and as the same may hereafter be further amended, modified, extended,
renewed, replaced, restated or supplemented from time to time pursuant to the
terms thereof, the "7-1/4% NOTES"), issued pursuant to that certain Indenture,
dated as of December 12, 1996 (as amended, supplemented or otherwise modified
and in effect on the date hereof and as the same may hereafter be further
amended, modified, extended, renewed, replaced, restated or supplemented from
time to time pursuant to the terms thereof, the "7-1/4% NOTES INDENTURE").

            (4) USI, USI Global and USI American are joint and several
co-obligors with respect to those certain 7-1/8% Senior Notes due October 15,
2003 (as amended, supplemented or otherwise modified and in effect on the
date hereof and as the same may hereafter be further amended, modified,
extended, renewed, replaced, restated or supplemented from time to time
pursuant to the terms thereof, the "7-1/8% NOTES"), issued pursuant to that
certain Indenture, dated as of October 27, 1998 (as amended, supplemented or
otherwise modified and in effect on the date hereof and as the same may
hereafter be further amended, modified, extended, renewed, replaced,
restated, or supplemented from time to time pursuant to the terms thereof,
the "7-1/8% NOTES INDENTURE").

            (5) USI and USI Global have also previously entered into a
Guaranty dated as of March 24, 2000 (as amended, supplemented or otherwise
modified and in effect on the date hereof and as the same may hereafter be
further amended, amended and restated, supplemented or otherwise modified
from time to time pursuant to the terms thereof, the "REXAIR GUARANTY"; the
7-1/4% Notes, the 7-1/4% Indenture, the 7-1/8% Notes, the 7-1/8% Notes
Indenture And the Rexair Guaranty are each referred to herein, individually,
as an "EXISTING INDEBTEDNESS AGREEMENT", and, collectively, as the "EXISTING
INDEBTEDNESS AGREEMENTS"), in favor of the Secured Creditors (as defined in
the Rexair Guaranty, such Secured Creditors being referred to herein as the
"REXAIR CREDITORS") in respect of Rexair, Inc.'s obligation under its Credit
Agreement, dated as of March 24, 2000, as amended.

            (6) Pursuant to each of the Existing Indebtedness Agreements, each
Borrower has agreed not to incur, and not to permit certain of its Subsidiaries
to incur, certain Liens (as therein defined) upon any of its property or assets
to secure certain Debt (as therein defined) without making effective provision
whereby the obligations under such Existing Indebtedness Agreement shall be
secured equally and ratably with the Debt secured by such Liens for so long as
such Debt shall be so secured.

            (7) Each Borrower and each other Initial Pledgor are entering into
this Agreement and that certain Collateral Trust Agreement dated as of the date
hereof (as amended, amended and restated, supplemented or otherwise modified
from time to time, the "COLLATERAL TRUST AGREEMENT"), with the Collateral
Trustees, in order to grant to the Collateral Trustees for their benefit and in
trust for the equal and ratable benefit of the Representatives and the Secured
Holders (each as defined in the Collateral Trust Agreement) a lien on and
security interest in all of their respective personal properties and fixtures
now owned or hereafter acquired.

            (8) Each Pledgor is the owner of the shares (the "INITIAL PLEDGED
SHARES") of stock set forth opposite such Pledgor's name on and as otherwise
described in Part A of Schedule I hereto and issued by the corporations named
therein and of the indebtedness (the "INITIAL PLEDGED Debt") set forth opposite
such Pledgor's name on and as otherwise described in Part B of Schedule I hereto
and issued by the obligors named therein.

            (9) Each Pledgor has security entitlements (the "PLEDGED SECURITY
ENTITLEMENTS") with respect to all the financial assets (the "PLEDGED FINANCIAL
ASSETS") credited from time to time to each securities account (each a
"SECURITIES ACCOUNT") set forth opposite such Pledgor's name on and as

<PAGE>
                                       3

otherwise described in Part C of Schedule I hereto, as such schedule may
hereafter be supplemented pursuant to Section 4(c) hereof.

            (10) The Pledgors have opened the Collateral Account (as defined in
the Collateral Trust Agreement) with the Corporate Trustee.

            (11) Each Pledgor has the operating and other deposit accounts (each
a "PLEDGED ACCOUNT") set forth opposite such Pledgor's name on and as otherwise
described in Schedule V hereto, as such schedule may hereafter be supplemented
pursuant to Section 5(c) hereof.

            (12) As a condition to the agreement of the Credit Parties to
continue to make Loans to the Borrowers under the Credit Agreements and issue
Letters of Credit for the account of the Borrowers under the 5-Year Credit
Agreement and the entry into Secured Hedge Agreements by the Hedge Banks (each
as defined in the Collateral Trust Agreement) from time to time, the Pledgors
shall have granted the assignment and security interest and made the pledge and
assignment contemplated by this Agreement.

            (13) Terms defined in the Collateral Trust Agreement and not
otherwise defined in this Agreement are used in this Agreement as defined in the
Collateral Trust Agreement. Further, unless otherwise defined in this Agreement
or the Collateral Trust Agreement, terms defined in Article 8 or 9 of the
Uniform Commercial Code in effect in the State of New York ("N.Y. UNIFORM
COMMERCIAL CODE") are used in this Agreement as such terms are defined in such
Article 8 or 9.

            NOW, THEREFORE, in consideration of the premises and in order to
induce the Credit Parties to continue to make Loans to the Borrowers under the
Credit Agreements and issue Letters of Credit for the account of the Borrowers
under the 5-Year Credit Agreement and to induce the Hedge Banks to enter into
Secured Hedge Agreements from time to time, each Pledgor hereby agrees with the
Collateral Trustees for the equal and ratable benefit of the Representatives and
the Secured Holders as follows:

            SECTION 1. GRANT OF SECURITY. Each Pledgor hereby assigns and
pledges to the Collateral Trustees for their benefit and in trust for the equal
and ratable benefit of the Representatives and the Secured Holders to the extent
set forth in Section 2 of this Agreement, and hereby grants to the Collateral
Trustees for their benefit and in trust for the equal and ratable benefit of the
Representatives and the Secured Holders, a lien on and a security interest in,
such Pledgor's right, title and interest in and to the following, in each case,
as to each type of property described below, whether now owned or hereafter
acquired by such Pledgor, wherever located, and whether now or hereafter
existing or arising (collectively, the "COLLATERAL"):

            (a) all equipment in all of its forms (including, without
      limitation, all manufacturing equipment, all office equipment and all
      motor vehicles and other distribution equipment), all fixtures and all
      parts thereof and all accessions thereto (any and all such equipment,
      fixtures, parts and accessions being the "EQUIPMENT");

            (b) all inventory in all of its forms, (including, without
      limitation, (i) all raw materials and work in process therefor, finished
      goods thereof and materials used or consumed in the manufacture,
      production, preparation or shipping thereof, (ii) goods in which such
      Pledgor has an interest in mass or a joint or other interest or right of
      any kind (including, without limitation, goods in which such Pledgor has
      an interest or right as consignee) and (iii) goods that are returned to or
      repossessed or stopped in transit by such Pledgor), and all accessions
      thereto

<PAGE>
                                       4

      and products thereof and documents therefor (any and all such inventory,
      accessions, products and documents being the "INVENTORY");

            (c) all accounts, chattel paper, instruments, deposit accounts,
      general intangibles and other obligations of any kind, whether or not
      arising out of or in connection with the sale or lease of goods or the
      rendering of services and whether or not earned by performance (including,
      without limitation, (i) all rights of such Pledgor to receive moneys due
      and to become due under or pursuant to any contract or agreement, (ii) all
      rights of such Pledgor to receive proceeds of any insurance, indemnity,
      warranty or guaranty with respect to any such contract or agreement, (iii)
      claims of such Pledgor for damages arising out of or for breach of or
      default under any such contract or agreement, and (iv) the right of such
      Pledgor to terminate any such contract or agreement, to perform thereunder
      and to compel performance and otherwise exercise all remedies thereunder),
      and all rights now or hereafter existing in and to all security
      agreements, leases and other contracts securing or otherwise relating to
      any such accounts, chattel paper, instruments, deposit accounts, general
      intangibles or obligation (any and all such accounts, chattel paper,
      instruments, deposit accounts, general intangibles and obligations, to the
      extent not referred to in clause (d), (e) or (f)(vi) below, being the
      "Receivables", and any and all such security agreements, leases and other
      contracts being the "RELATED CONTRACTS");

            (d) the following (the "SECURITY COLLATERAL"):

                  (i) the Initial Pledged Shares and the certificates, if any,
            representing the Initial Pledged Shares, and all dividends, cash,
            instruments and other property from time to time received,
            receivable or otherwise distributed in respect of or in exchange for
            any or all of the Initial Pledged Shares;

                  (ii) the Initial Pledged Debt and the instruments, if any,
            evidencing the Initial Pledged Debt, and all interest, cash,
            instruments and other property from time to time received,
            receivable or otherwise distributed in respect of or in exchange for
            any or all of the Initial Pledged Debt;

                  (iii) all additional shares of stock or other equity interests
            in any Person from time to time acquired by such Pledgor in any
            manner (such shares and other interests, together with the Initial
            Pledged Shares, being the "PLEDGED SHARES"), and the certificates,
            if any, representing such additional shares or other interests, and
            all dividends, cash, instruments and other property from time to
            time received, receivable or otherwise distributed in respect of or
            in exchange for any or all of such shares or other interests;
            PROVIDED that such Pledgor shall not be required to pledge, and the
            terms "PLEDGED SHARES" and "SECURITY COLLATERAL" used in this
            Agreement shall not include, any shares of stock in any Foreign
            Corporation (as hereinafter defined) owned or otherwise held thereby
            which, when aggregated with all of the other shares of stock in such
            Foreign Corporation pledged by such Pledgor, would result in 66% or
            more of the shares of stock in such Foreign Corporation entitled to
            vote (within the meaning of Treasury Regulation Section
            1.956-2(c)(2) promulgated under the Internal Revenue Code) (the
            "VOTING FOREIGN STOCK") (on a fully diluted basis) being pledged to
            the Secured Holders under this Agreement (although all of the shares
            of stock in such Foreign Corporation not entitled to vote (within
            the meaning of Treasury Regulation Section 1.956-2(c)(2) promulgated
            under the Internal Revenue Code) (the "NON-VOTING FOREIGN STOCK")
            shall be pledged by the Pledgor); PROVIDED FURTHER that, if, as a
            result of any change in the tax laws of the United States of America
            after the date of this Agreement, the pledge by the Pledgors of any
            additional shares of stock in any such

<PAGE>
                                       5

            Foreign Corporation to the Secured Holders under this Agreement
            would not result in an increase in the net tax liabilities of such
            Pledgors, then, promptly after the change in such laws, all such
            additional shares of stock shall be so pledged under this Agreement
            (for purposes of this Section 1(d)(iii), "FOREIGN CORPORATION"
            means, at any time, any direct or indirect Subsidiary of each
            Pledgor organized outside of the laws of the United States or any
            state or other political subdivision thereof at such time that
            constitutes a "controlled foreign corporation" under Section 957 of
            the Internal Revenue Code);

                  (iv) all additional indebtedness from time to time owed to
            such Pledgor (such indebtedness, together with the Initial Pledged
            Debt, being the "PLEDGED DEBT") and the instruments, if any,
            evidencing such indebtedness, and all interest, cash, instruments
            and other property from time to time received, receivable or
            otherwise distributed in respect of or in exchange for any or all of
            such indebtedness;

                  (v) all Securities Accounts of such Pledgor, all Pledged
            Security Entitlements with respect to all Pledged Financial Assets
            from time to time credited to such Securities Accounts, and all
            Pledged Financial Assets, and all dividends, interest, cash,
            instruments and other property from time to time received,
            receivable or otherwise distributed in respect of or in exchange for
            any or all of such Pledged Security Entitlements or such Pledged
            Financial Assets; and

                  (vi) all other investment property (including, without
            limitation, all (A) securities, whether certificated or
            uncertificated, (B) security entitlements, (C) securities accounts,
            (D) commodity contracts and (E) commodity accounts) in which such
            Pledgor has now, or acquires from time to time hereafter, any right,
            title or interest in any manner, and the certificates or
            instruments, if any, representing or evidencing such investment
            property, and all dividends, interest, distributions, value, cash,
            instruments and other property from time to time received,
            receivable or otherwise distributed in respect of or in exchange for
            any or all of such investment property;

            (e) the following (collectively, the "ACCOUNT COLLATERAL"):

                  (i) the Collateral Account, all financial assets from time to
            time credited to the Collateral Account (including, without
            limitation, all Cash Equivalents from time to time credited to the
            Collateral Account), and all dividends, interest, cash, instruments
            and other property from time to time received, receivable or
            otherwise distributed in respect of or in exchange for any or all of
            such financial assets;

                  (ii) all Pledged Accounts of such Pledgor, all funds held
            therein and all certificates and instruments, if any, from time to
            time representing or evidencing such Pledged Accounts;

                  (iii) all other deposit accounts of such Pledgor from time to
            time, all funds held therein and all certificates and instruments,
            if any, from time to time representing or evidencing such deposit
            accounts;

                  (iv) all notes, certificates of deposit, deposit accounts,
            checks and other instruments from time to time delivered to or
            otherwise possessed by the Collateral Trustees for or on behalf of
            such Pledgor, including, without limitation, those delivered or
            possessed in substitution for or in addition to any or all of the
            then existing Account Collateral; and

<PAGE>
                                       6

                  (v) all interest, dividends, cash, instruments and other
            property from time to time received, receivable or otherwise
            distributed in respect of or in exchange for any or all of the then
            existing Account Collateral;

            (f) the following (collectively, the "INTELLECTUAL PROPERTY
      COLLATERAL"):

                  (i) all United States, international and foreign patents,
            patent applications and statutory invention registrations,
            including, without limitation, the patents and patent applications
            set forth in Part A of Schedule IV hereto (as such Schedule IV may
            be supplemented from time to time by supplements to this Agreement,
            each such supplement being in substantially the form of Exhibit F
            hereto (an "IP SECURITY AGREEMENT SUPPLEMENT"), executed and
            delivered by such Pledgor to the Collateral Trustees from time to
            time), together with all reissues, divisions, continuations,
            continuations-in-part, extensions and reexaminations thereof, all
            inventions therein, all rights therein provided by international
            treaties or conventions and all improvements thereto, and all other
            rights of any kind whatsoever of such Pledgor accruing thereunder or
            pertaining thereto (the "PATENTS");

                  (ii) all trademarks (including, without limitation, service
            marks), certification marks, collective marks, trade dress, logos,
            domain names, product configurations, trade names, business names,
            corporate names and other source identifiers, whether or not
            registered, whether currently in use or not, including, without
            limitation, all common law rights and registrations and applications
            for registration thereof, including, without limitation, the
            trademark registrations and trademark applications set forth in Part
            B of Schedule IV hereto (as such Schedule IV may be supplemented
            from time to time by IP Security Agreement Supplements executed and
            delivered by such Pledgor to the Collateral Trustees from time to
            time), and all other marks registered in the U.S. Patent and
            Trademark Office or in any office or agency of any State or
            Territory of the United States or any foreign country (but excluding
            any United States intent-to-use trademark application prior to the
            filing and acceptance of a Statement of Use or an Amendment to
            allege use in connection therewith to the extent that a valid
            security interest may not be taken in such an intent-to-use
            trademark application under applicable law), and all rights therein
            provided by international treaties or conventions, all reissues,
            extensions and renewals of any of the foregoing, together in each
            case with the goodwill of the business connected therewith and
            symbolized thereby, and all rights corresponding thereto throughout
            the world and all other rights of any kind whatsoever of such
            Pledgor accruing thereunder or pertaining thereto (the
            "TRADEMARKS");

                  (iii) all copyrights, copyright applications, copyright
            registrations and like protections in each work of authorship,
            whether statutory or common law, whether published or unpublished,
            any renewals or extensions thereof, all copyrights of works based
            on, incorporated in, derived from, or relating to works covered by
            such copyrights, including, without limitation, the copyright
            registrations and copyright applications set forth in Part C of
            Schedule IV hereto (as such Schedule IV may be supplemented from
            time to time by IP Security Agreement Supplements executed and
            delivered by such Pledgor to the Collateral Trustees from time to
            time), together with all rights corresponding thereto throughout the
            world and all other rights of any kind whatsoever of such Pledgor
            accruing thereunder or pertaining thereto (the "Copyrights");

                  (iv) all confidential and proprietary information, including,
            without limitation, know-how, trade secrets, manufacturing and
            production processes and

<PAGE>
                                       7

            techniques, inventions, research and development information,
            technical data, financial, marketing and business data, pricing and
            cost information, business and marketing plans and customer and
            supplier lists and information (the "TRADE SECRETS");

                  (v) all computer software programs and databases (including,
            without limitation, source code, object code and all related
            applications and data files), firmware, and documentation and
            materials relating thereto, and all rights with respect to the
            foregoing, together with any and all options, warranties, service
            contracts, program services, test rights, maintenance rights,
            improvement rights, renewal rights and indemnifications and any
            substitutions, replacements, additions or model conversions of any
            of the foregoing (the "COMPUTER SOFTWARE");

                  (vi) all license agreements, permits, authorizations and
            franchises, whether with respect to the Patents, Trademarks,
            Copyrights, Trade Secrets or Computer Software, or with respect to
            the patents, trademarks, copyrights, trade secrets, computer
            software or other proprietary right of any other Person, including,
            without limitation, the license agreements set forth in Part D of
            Schedule IV hereto (as such Schedule IV may be supplemented from
            time to time by IP Security Agreement Supplements executed and
            delivered by such Pledgor to the Collateral Trustees from time to
            time), and all income, royalties and other payments now or hereafter
            due and/or payable with respect thereto, subject, in each case, to
            the terms of such license agreements, permits, authorizations and
            franchises, (the "LICENSES"); and

                  (vii) any and all claims for damages for past, present and
            future infringement, misappropriation or breach with respect to the
            Patents, Trademarks, Copyrights, Trade Secrets, Computer Software or
            Licenses, with the right, but not the obligation, to sue for and
            collect, or otherwise recover, such damages; and

            (g) all proceeds of any and all of the Collateral (including,
      without limitation, proceeds that constitute property of the types
      described in clauses (a) through (f) of this Section 1 and this clause
      (g)) and, to the extent not otherwise included, all (i) payments under
      insurance (whether or not the Collateral Trustees are the loss payee
      thereof), or any indemnity, warranty or guaranty, payable by reason of
      loss or damage to or otherwise with respect to any of the foregoing
      Collateral and (ii) cash.

            Notwithstanding anything to the contrary contained in this Section
1, the following property shall be excluded from the lien and security interest
granted hereunder:

            (i) any contract, agreement or other document (and any contract
      rights arising thereunder) to which any of the Pledgors is a party on the
      date hereof and any similar contract or agreement entered into by any
      Pledgor after the date hereof with the prior written consent of the
      Required Representatives, in each case, shall be excluded from the lien
      and security interest granted by such Pledgor under this Section 1 to the
      extent that the assignment thereof, or the creation of a lien and security
      interest therein, would constitute a breach of the terms of such contract,
      agreement or other document, or would permit any party to such contract,
      agreement or other document to terminate such contract rights or agreement
      (all such contracts, agreements and other documents being the "EXCLUDED
      AGREEMENTS"); PROVIDED, HOWEVER, that (1) the exclusion from the lien and
      security interest granted by such Pledgor hereunder of any contract rights
      of any of the Pledgors under one or more of the Excluded Agreements shall
      not limit, restrict or impair the grant by such Pledgor of the lien and
      security interest in any accounts or receivables arising under any such
      Excluded Agreement or any payments due or to become due thereunder, and

<PAGE>
                                       8

      (2) any of the Excluded Agreements shall cease to be excluded from this
      Section 1, if, at any time, (A) the prohibition of assignment or of the
      creation of a lien and security interest in such agreement is no longer in
      effect, or (B) the applicable Pledgor has obtained the consent of the
      other parties to such agreement to the assignment of, or creation of a
      lien and security interest in, the contract rights of such Pledgor
      thereunder;

            (ii) any license, permit or authorization from any Governmental
      Authority in favor of any Pledgor shall be excluded from the lien and
      security interest granted by such Pledgor under this Section 1 to the
      extent that the assignment thereof or the creation of a lien and security
      interest therein would constitute a breach of the terms of such license,
      permit or authorization or would require any separate license, permit or
      authorization or would otherwise terminate such license, permit or
      authorization (all of the licenses, permits and authorizations referred to
      herein being the "EXCLUDED AUTHORIZATIONS"); PROVIDED, HOWEVER, that any
      of the Excluded Authorizations shall cease to be excluded from this
      Section 1, if, at any time (1) the prohibition of assignment or of the
      creation of a lien and security interest in such license, permit or
      authorization is no longer in effect or (2) the applicable Pledgor has
      obtained the consent of the applicable Governmental Authority to the
      assignment of, or creation of a lien and security interest in, such
      license, permit or authorization of such Pledgor; and

            (iii) any property of a Pledgor which is subject to any Lien which
      such Pledgor is permitted to enter into pursuant to the terms of Section
      8.01(h) of the 5-Year Credit Agreement, to the extent that such Pledgor
      has agreed not to further encumber such property (all such property being
      "OTHER EXCLUDED PROPERTY"), shall be excluded from the lien and security
      interest granted by such Pledgor under this Section 1; PROVIDED, HOWEVER,
      that any such Other Excluded Property shall cease to be excluded from this
      Section 1, if, at any time, the prohibition of assignment or the creation
      of a lien and security interest in such property is no longer in effect by
      reason of an amendment, waiver or other modification of the applicable
      Security Instrument or the release or satisfaction of such Security
      Instrument.

            In addition, nothing in this Agreement shall be deemed to require
any Pledgor to seek the consent of any Person or Governmental Authority to the
assignment of, or the creation of a lien on or a security interest in, any
Excluded Agreement, Excluded Authorization or Other Excluded Property.

            SECTION 2. SECURITY FOR SECURED OBLIGATIONS. This Agreement secures,
(a) in the case of each Pledgor that is not an Unrestricted Subsidiary Pledgor,
the payment of all the Secured Obligations by the Borrowers now or hereafter
existing under the Secured Agreements and (b) in the case of each Unrestricted
Subsidiary Pledgor, the payment of all the Secured Obligations by the Borrowers
now or hereafter existing under the Secured Agreements other than Secured
Obligations arising under the 7-1/4% Notes and the 7-1/8% Notes.

            SECTION 3. PLEDGORS REMAIN LIABLE. Anything herein to the contrary
notwithstanding, (a) each Pledgor shall remain liable under the contracts and
agreements included in such Pledgor's Collateral to the extent set forth therein
to perform all of its duties and obligations thereunder to the same extent as if
this Agreement had not been executed, (b) the exercise by the Collateral
Trustees of any of the rights hereunder shall not release any Pledgor from any
of its duties or obligations under the contracts and agreements included in the
Collateral and (c) neither the Collateral Trustees nor any Secured Holder shall
have any obligation or liability under the contracts and agreements included in
the Collateral by reason of this Agreement or any Secured Agreement, nor shall
the Collateral Trustees or any Secured Holder be obligated to perform any of the
obligations or duties of any Pledgor thereunder or to take any action to collect
or enforce any claim for payment assigned hereunder.

<PAGE>
                                       9

            SECTION 4. DELIVERY AND CONTROL OF SECURITY COLLATERAL. (a) All
certificates or instruments representing or evidencing Security Collateral shall
be delivered to and held by or on behalf of the Collateral Trustees pursuant
hereto and shall be in suitable form for transfer by delivery, or shall be
accompanied by duly executed instruments of transfer or assignment in blank, all
in form and substance satisfactory to the Collateral Trustees. Upon the
occurrence and during the continuance of an Actionable Default, the Collateral
Trustees shall have the right, at any time in their discretion and without
notice to any Pledgor, to transfer to or to register in the name of the
Collateral Trustees or any of their nominees any or all of the Security
Collateral, subject only to the revocable rights specified in Section 12(a). In
addition, the Collateral Trustees shall have the right at any time to exchange
certificates or instruments representing or evidencing Security Collateral for
certificates or instruments of smaller or larger denominations. Also, the
Collateral Trustees shall have the right at any time to convert Security
Collateral consisting of financial assets credited to any Securities Account of
any Pledgor to Security Collateral consisting of financial assets held directly
by the Collateral Trustees, and to convert Security Collateral consisting of
financial assets held directly by the Collateral Trustees to Security Collateral
consisting of financial assets credited to such Securities Account.

            (b) Subject to Section 5(e)(ii) of the 5-year Credit Agreement
Amendment, with respect to any Security Collateral in which any Pledgor has any
right, title or interest and that constitutes an uncertificated security, such
Pledgor will cause the issuer thereof either (i) to register the Collateral
Trustees as the registered owner of such security or (ii) to agree in writing
with such Pledgor and the Collateral Trustees that such issuer will comply with
instructions with respect to such security originated by the Collateral Trustees
without further consent of such Pledgor, such agreement to be in form and
substance satisfactory to the Collateral Trustees. Each Pledgor which has issued
any Security Collateral to any other Pledgor hereby agrees with such other
Pledgor and the Collateral Trustees that it will comply with instructions with
respect to such Security Collateral originated by the Collateral Trustees
without further consent of such other Pledgor.

            (c) Subject to Section 5(e)(ii) of the 5-year Credit Agreement
Amendment, with respect to any Security Collateral in which any Pledgor has any
right, title or interest and that constitutes a security entitlement, such
Pledgor will cause the securities intermediary with respect to such security
entitlement either (i) to identify in its records the Collateral Trustees as the
entitlement holder of such security entitlement against such securities
intermediary or (ii) to agree in writing with such Pledgor and the Collateral
Trustees that such securities intermediary will comply with entitlement orders
(that is, notifications communicated to such securities intermediary directing
transfer or redemption of the financial asset to which such Pledgor has a
security entitlement) originated by the Collateral Trustees without further
consent of such Pledgor, such agreement to be in substantially the form of
Exhibit D hereto or otherwise in form and substance satisfactory to the
Collateral Trustees (such agreement being a "SECURITIES ACCOUNT CONTROL
AGREEMENT"). Each Pledgor agrees that it will not establish or open any
additional securities account in addition to those listed in Part C of Schedule
I hereto, unless the Collateral Trustee shall have received at least 10 days'
prior written notice of such addition and shall have received a Securities
Account Control Agreement (or a supplement to an existing Securities Account
Control Agreement) covering such new securities account, and upon the receipt by
the Collateral Trustees of such Securities Account Control Agreement (or
supplement), Part C of Schedule I hereto shall be automatically amended to
include such securities account. Each Pledgor agrees that it will not terminate
any Securities Account unless the Collateral Trustees and the Required
Representatives shall have received at least 10 days' prior written notice of
such termination (and, upon such termination, Part C of Schedule I hereto shall
be automatically amended to delete such Securities Account.)

            (d) No Pledgor will change or add any securities intermediary that
maintains any securities account in which any of the Collateral is credited or
carried, or change or add any such

<PAGE>
                                       10

securities account, in each case without first complying with the above
provisions of this Section 4 in order to perfect the security interest granted
hereunder in such Collateral.

            SECTION 5. MAINTAINING THE PLEDGED ACCOUNTS. (a) At the written
request of the Required Representatives delivered after the occurrence and
during the continuance of one of the events specified in Section 6 of the 5-Year
Credit Agreement Amendment, each Pledgor will maintain all deposit accounts
including, without limitation, the Pledged Accounts, only with banks (the
"PLEDGED ACCOUNT BANKS") that have entered into letter agreements in
substantially the form of Exhibit B hereto (or otherwise in form and substance
satisfactory to the Required Representatives) with such Pledgor and the
Collateral Trustees (the "PLEDGED ACCOUNT LETTERS").

            (b) At the request of the Collateral Trustees after the occurrence
and during the continuance of an Actionable Default, each Pledgor will instruct
each Pledged Account Bank to transfer to the Collateral Account, at the end of
each Business Day, in same day funds, an amount equal to the credit balance of
each Pledged Account in such Pledged Account Bank. If any Pledgor shall fail to
give any such instructions to any Pledged Account Bank, the Collateral Trustees
may do so without further notice to any Pledgor.

            (c) At all times after a request has been delivered as provided in
subsection (a) of this Section 5, each Pledgor agrees that it will not add any
bank as a Pledged Account Bank or add any account as a Pledged Account to those
listed in Schedule V hereto, unless the Collateral Trustees shall have received
at least 10 days' prior written notice of such addition and in accordance with
the provisions of Section 6 of the 5-Year Credit Agreement Amendment shall have
received a Pledged Account Letter executed by such new Pledged Account Bank and
such Pledgor or a supplement to an existing Pledged Account Letter covering such
new Pledged Account, as the case may be (and, upon the receipt by the Collateral
Trustees of such Pledged Account Letter or supplement, Schedule V hereto shall
be automatically amended to include such Pledged Account Bank or Pledged
Account); and each Pledgor agrees that it will not terminate any bank as a
Pledged Account Bank or terminate any account as a Pledged Account, unless the
Collateral Trustees and the Required Representatives shall have received at
least 10 days' prior written notice of such termination (and, upon such
termination, Schedule V hereto shall be automatically amended to delete such
Pledged Account Bank or Pledged Account).

            SECTION 6. REPRESENTATIONS AND WARRANTIES. Each Pledgor represents
and warrants as follows:

            (a) All of the Equipment and Inventory of such Pledgor are located
      at the places specified in Schedule II hereto, as such Schedule II may be
      amended from time to time pursuant to Section 8(a). Set forth in Part A of
      Schedule II for each Pledgor is a complete and accurate list of all real
      property owned by such Pledgor, showing as of the date hereof the street
      address, county or other relevant jurisdiction, state, record owner and
      book value thereof. Set forth in Part B of Schedule II for each Pledgor is
      a complete and accurate list of all leases of real property under which
      any Pledgor is the lessee, showing as of the date hereof the street
      address, county or other relevant jurisdiction, state, lessor, lessee,
      expiration date and annual rental cost thereof. Set forth in Part C of
      Schedule II for each Pledgor is a complete and accurate list of all
      warehouses and other locations (other than as set forth in Parts A or B of
      such Schedule II) where such Pledgor stores any of its Inventory or
      Equipment, showing as of the date hereof the street address, county or
      other relevant jurisdiction, for such warehouseman or other bailee, and
      the nature of its contractual or other relationship with such Pledgor. The
      chief executive office of such Pledgor and the original copies of each
      Related Contract to which such Pledgor is a party (to the extent possessed
      by such Pledgor) and all originals of all chattel paper that evidence
      Receivables of such Pledgor, are located at the address specified therefor
      in Schedule III hereto, as such Schedule III

<PAGE>
                                       11

      may be amended from time to time pursuant to Section 10(a). Such Pledgor's
      state of organization and its federal tax identification number are set
      forth opposite such Pledgor's name in Schedule III hereto. All Security
      Collateral consisting of certificated securities and instruments have been
      delivered to the Collateral Trustees. None of the Receivables or Related
      Contract is evidenced by a promissory note or other instrument that has
      not been delivered to the Collateral Trustees.

            (b) Such Pledgor is the legal and beneficial owner of the Collateral
      of such Pledgor free and clear of any Lien, claim, option or right of
      others, except for the security interest created under this Agreement and
      other Liens permitted to exist under the Credit Agreements. No effective
      financing statement or other instrument similar in effect covering all or
      any part of such Collateral or listing such Pledgor or any trade name of
      such Pledgor as debtor is on file in any recording office, except such as
      may have been filed in favor of the Collateral Trustees relating to the
      Collateral Documents. Such Pledgor has the trade names listed on Part B of
      Schedule IV hereto.

            (c) Such Pledgor has exclusive possession and control of the
      Equipment and Inventory, other than Inventory and Equipment stored at any
      locations specified in Part B and C of Schedule II (as such Schedule II
      may be amended from time to time pursuant to Section 8(a)), in which case
      such Pledgor shall seek to obtain a landlord's or warehouseman's agreement
      substantially in the form of Exhibit C hereto (or otherwise in form and
      substance satisfactory to the Required Representatives) in accordance with
      the provisions of Sections 5 or 6 of the 5-Year Credit Agreement
      Amendment, if such an agreement has been requested by the Required
      Representatives.

            (d) The Pledged Shares issued by Affiliates of such Pledgor and
      pledged by such Pledgor hereunder have been duly authorized and validly
      issued and are fully paid and non-assessable. The Pledged Debt issued by
      Affiliates of such Pledgor and pledged by such Pledgor hereunder has been
      duly authorized, authenticated or issued and delivered, is the legal,
      valid and binding obligation of the issuers thereof, is evidenced by one
      or more promissary notes (which notes have been delivered to the
      Collateral Trustees) and is not in default.

            (e) The Initial Pledged Shares constitute the percentage of the
      issued and outstanding shares of stock of the issuers thereof indicated on
      Schedule I hereto as of the date hereof. The Initial Pledged Debt
      constitutes all of the outstanding indebtedness owed to such Pledgor by
      the issuers thereof and is outstanding, as of the date hereof, in the
      principal amount indicated on Schedule I hereto as of the date hereof.

            (f) All of the investment property owned by such Pledgor as of the
      date hereof is listed on Schedule I hereto.

            (g) As of the date hereof, such Pledgor has no Pledged Accounts or
      other deposit accounts other than the Pledged Accounts listed on Schedule
      V hereto and the Collateral Account.

            (h) All filings and other actions necessary or reasonably desirable
      to perfect and protect the security interest in the Collateral of such
      Pledgor created under this Agreement have been duly made or taken and are
      in full force and effect, or shall be duly made or taken or instruments
      therefore shall have been delivered to the Collateral Trustee and shall be
      in full force and effect within the time period specified in Sections 5, 6
      or 7 of the 5-Year Credit Agreement Amendment, and this Agreement creates
      in favor of the Collateral Trustees for the equal and

<PAGE>
                                       12

      ratable benefit of the Secured Holders a valid and, together with such
      filings and other actions, perfected security interest in the Collateral
      of such Pledgor, securing the payment of the Secured Obligations, subject
      only to Permitted Liens.

            (i) No authorization or approval or other action by, and no notice
      to or filing with, any governmental authority or regulatory body or any
      other third party is required for (i) the grant by such Pledgor of the
      assignment, pledge and security interest granted hereunder or for the
      execution, delivery or performance of this Agreement and the Collateral
      Trust Agreement by such Pledgor, (ii) the perfection or maintenance of the
      assignment, pledge and security interest created hereunder (including the
      first priority nature of such assignment, pledge or security interest),
      except for (A) the filing of financing and continuation statements under
      the Uniform Commercial Code, which financing statements have been duly
      filed and are in full force and effect, or shall be duly filed or
      instruments therefor shall have been provided to the Collateral Trustee
      and shall be in full force and effect within the time period specified in
      Section 5 of the 5-Year Credit Agreement Amendment, (B) the recordation of
      the Intellectual Property Security Agreements referred to in Section 11(f)
      with the U.S. Patent and Trademark Office and the U.S. Copyright Office,
      which Agreements have been duly recorded and are in full force and effect,
      or shall have been provided to the Collateral Trustee and shall be duly
      recorded and shall be in full force and effect within the time period
      specified in Section 5 of the 5-Year Credit Agreement Amendment, (C) the
      actions described in Section 4 with respect to Security Collateral, which
      actions have been taken and are in full force and effect or shall be taken
      within the time period specified in Section 5 of the 5-Year Credit
      Agreement Amendment, and (D) the execution of Pledged Account Letters by
      the Pledged Account Banks, which actions shall be taken within the time
      period specified in Section 6 of the 5-Year Credit Agreement Amendment, or
      (iii) for the exercise by the Collateral Trustees of their voting or other
      rights provided for in this Agreement or the remedies in respect of the
      Collateral pursuant to this Agreement, except as may be required in
      connection with the disposition of any portion of the Security Collateral
      by laws affecting the offering and sale of securities generally.

            (j) The Inventory that has been produced or distributed by such
      Pledgor has been produced in all material respects in compliance with all
      requirements of applicable law, including, without limitation, to the
      extent applicable, the Fair Labor Standards Act.

            (k) As to itself and its Intellectual Property Collateral:

                  (i) Except with respect to any Immaterial IP Collateral (as
            hereinafter defined), the rights of such Pledgor in or to the
            Intellectual Property Collateral do not conflict with,
            misappropriate or infringe upon the intellectual property rights of
            any third party, and no claim has been asserted that the use of such
            Intellectual Property Collateral does or may infringe upon the
            intellectual property rights of any third party.

                  (ii) Such Pledgor is the exclusive owner of the entire and
            unencumbered right, title and interest in and to its Intellectual
            Property Collateral, as described on Schedule IV hereto, and is
            entitled to use all such Intellectual Property Collateral without
            limitation, subject only to the license terms of the Licenses.

                  (iii) The Intellectual Property Collateral set forth on
            Schedule IV hereto includes all of the patents, patent applications,
            trademark registrations and applications, copyright registrations
            and applications and Licenses owned by such Pledgor.

<PAGE>
                                       13

                  (iv) The Intellectual Property Collateral is subsisting and
            has not been adjudged invalid or unenforceable in whole or part, and
            to the best of such Pledgor's knowledge, is valid and enforceable.
            Such Pledgor is not aware of any uses of any item of Intellectual
            Property Collateral that could be expected to lead to such item
            becoming invalid or unenforceable.

                  (v) Except with respect to (A) any Immaterial IP Collateral or
            (B) any other Intellectual Property Collateral as to which the
            Required Representatives have determined pursuant to Section 5 of
            the 5-Year Credit Agreement Amendment or otherwise that the cost and
            expense of perfecting and maintaining the lien hereunder is
            disproportionately high relative to the fair market value of such
            Intellectual Property Collateral as determined in good faith by USI,
            such Pledgor has made or performed, or shall have made or performed
            within the time period specified in Section 5 of the 5-Year Credit
            Agreement Amendment, all filings, recordings and other acts and has
            paid, or shall have paid within such time period, all required fees
            and taxes to maintain and protect its interest in each and every
            item of Intellectual Property Collateral in full force and effect
            throughout the world, and to protect and maintain its interest
            therein including, without limitation, recordations of any of its
            interests in the Patents and Trademarks with the U.S. Patent and
            Trademark Office and in corresponding national and international
            patent offices, and recordation of any of its interests in the
            Copyrights with the U.S. Copyright Office and in corresponding
            national and international copyright offices. Such Pledgor has used
            proper statutory notice in connection with its use of each patent,
            trademark and copyright of the Intellectual Property Collateral.

                  (vi) Except with respect to any Immaterial IP Collateral, no
            action, suit, investigation, litigation or proceeding has been
            asserted or is pending or threatened against such Pledgor (i) based
            upon or challenging or seeking to deny or restrict the use of any of
            the Intellectual Property Collateral, or (ii) alleging that any
            services provided by, processes used by, or products manufactured or
            sold by, such Pledgor infringe upon or misappropriate any patent,
            trademark, copyright or any other proprietary right of any third
            party. To the best of such Pledgor's knowledge, no Person is
            engaging in any activity that infringes upon or misappropriates the
            Intellectual Property Collateral, other than any Immaterial IP
            Collateral, or upon the rights of such Pledgor therein. Except as
            set forth on Schedule IV hereto, such Pledgor has not granted any
            license, release, covenant not to sue, non-assertion assurance, or
            other right to any Person with respect to any part of the
            Intellectual Property Collateral. The consummation of the
            transactions contemplated by the Collateral Trust Agreement will not
            result in the termination or impairment of any of the Intellectual
            Property Collateral, other than any Immaterial IP Collateral.

                  (vii) Standardized Commercial licenses not subject to
            substantial negotiation or with respect to each License, other than
            any such License that constitutes or exists in respect of Immaterial
            IP Collateral: (A) to the best of such Pledgor's knowledge, such
            License is valid and binding and in full force and effect and
            represents the entire agreement between the respective licensor and
            licensee with respect to the subject matter of such License; (B)
            with respect only to each License entered into after the date
            hereof, except Standardized Commercial licenses not subject to
            substantial negotiation or as otherwise may be agreed to in writing
            by the Required Representatives, such License is not an Excluded
            Agreement or Other Excluded Property and such License will not cease
            to be valid and binding and in full force and effect on terms
            identical to those currently in effect as a result of the rights and
            interest granted herein, nor will the grant of such rights

<PAGE>
                                       14

            and interest constitute a breach or default under such License or
            otherwise give the licensor or licensee a right to terminate such
            License; (C) such Pledgor has not received any notice of termination
            or cancellation under such License; (D) such Pledgor has not
            received any notice of a breach or default under such License, which
            breach or default has not been cured; (E) such Pledgor has not
            granted to any other third party any rights, adverse or otherwise,
            under such License; and (F) neither such Pledgor nor any other party
            to such License is in breach or default in any material respect, and
            no event has occurred that, with notice or lapse of time or both,
            would constitute such a breach or default or permit termination,
            modification or acceleration under such License.

                  (viii) To the best of such Pledgor's knowledge, (A) none of
            the Trade Secrets of such Pledgor has been used, divulged, disclosed
            or appropriated to the detriment of such Pledgor for the benefit of
            any other Person other than such Pledgor; (B) no employee,
            independent contractor or agent of such Pledgor has misappropriated
            any trade secrets of any other Person in the course of the
            performance of his or her duties as an employee, independent
            contractor or agent of such Pledgor; and (C) no employee,
            independent contractor or agent of such Pledgor is in default or
            breach of any term of any employment agreement, non-disclosure
            agreement, assignment of inventions agreement or similar agreement
            or contract relating in any way to the protection, ownership,
            development, use or transfer of such Pledgor's Intellectual Property
            Collateral.

                  (ix) Certain items of Intellectual Property Collateral, the
            fair market value of which does not individually exceed $25,000 or
            in the aggregate exceed $500,000 (as reasonably determined in good
            faith by USI as of the date hereof, and as of each date on which
            Schedule IV is supplemented pursuant to the terms hereof), have been
            designated as such on Schedule IV hereto, such items, together with
            such other Intellectual Property Collateral as the 5-Year Agent and
            USI agree are not material (the "IMMATERIAL IP COLLATERAL"). The
            Immaterial IP Collateral, both individually and in the aggregate, is
            not necessary in any material respect to the continued conduct by
            any Pledgor of its business as such business is conducted on the
            date hereof or as the same may hereafter be conducted from time to
            time.

            SECTION 7. FURTHER ASSURANCES. (a) Each Pledgor agrees that from
time to time, at the expense of such Pledgor, such Pledgor will promptly execute
and deliver all further instruments and documents, and take all further action,
that may be necessary or reasonably desirable, or that the Collateral Trustees
may reasonably request, in order to perfect and protect any pledge, assignment
or security interest granted or purported to be granted by such Pledgor
hereunder or to enable the Collateral Trustees to exercise and enforce their
rights and remedies hereunder with respect to any Collateral of such Pledgor.
Without limiting the generality of the foregoing, each Pledgor will promptly
with respect to Collateral of such Pledgor: (i) mark conspicuously each document
included in Inventory, each chattel paper included in Receivables, each Related
Contract and, at the request of the Collateral Trustees or the Required
Representatives, each of its records pertaining to such Collateral with a
legend, in form and substance satisfactory to the Collateral Trustees,
indicating that such document, chattel paper, Related Contract or Collateral is
subject to the security interest granted hereby; (ii) if any such Collateral
shall be evidenced by a promissory note or other instrument, deliver and pledge
to the Collateral Trustees hereunder such note or instrument duly indorsed and
accompanied by duly executed instruments of transfer or assignment, all in form
and substance satisfactory to the Collateral Trustees; (iii) execute and file
such financing or continuation statements, or amendments thereto, and such other
instruments or notices, as may be necessary or reasonably desirable, or as the
Collateral Trustees may reasonably request, in order to perfect and preserve the
security interest granted or purported to be granted by such Pledgor hereunder;
(iv) deliver and pledge to the Collateral Trustees for benefit of the Secured
Holders

<PAGE>
                                       15

certificates representing Security Collateral that constitutes certificated
securities, accompanied by undated stock or bond powers executed in blank; and
(v) deliver to the Collateral Trustees evidence that all other action that the
Collateral Trustees may deem reasonably necessary or desirable in order to
perfect and protect the security interest created by such Pledgor under this
Agreement has been taken.

            (b) Each Pledgor hereby authorizes the Collateral Trustees to file
one or more financing or continuation statements, and amendments thereto,
relating to all or any part of the Collateral of such Pledgor without the
signature of such Pledgor where permitted by law. A photocopy or other
reproduction of this Agreement or any financing statement covering the
Collateral or any part thereof shall be sufficient as a financing statement
where permitted by law.

            (c) Each Pledgor will furnish to the Collateral Trustees from time
to time statements and schedules further identifying and describing the
Collateral of such Pledgor and such other reports in connection with such
Collateral as the Collateral Trustees may reasonably request, all in reasonable
detail.

            (d) The Borrowers will furnish to the Collateral Trustees, on or
prior to each of the first and the fifth anniversary of the Perfection Date (but
not more than six months prior thereto), an opinion of counsel acceptable to the
Required Representatives to the effect that all financing or continuation
statements have been filed, and all other action has been taken, to perfect
continuously from the date which is 90 days from the date hereof the security
interest granted hereunder.

            SECTION 8. AS TO EQUIPMENT AND INVENTORY. (a) Each Pledgor will keep
the Equipment and Inventory of such Pledgor (other than Inventory sold in the
ordinary course of business) at the places therefor specified in Section 6(a)
or, upon 30 days' prior written notice to the Collateral Trustees, at such other
places in a jurisdiction where all action required by Section 7 shall have been
taken with respect to such Equipment and Inventory (and, upon the taking of such
action in such jurisdiction, Schedule II hereto shall be automatically amended
to include such other places).

            (b) Each Pledgor will cause the Equipment of such Pledgor to be
maintained and preserved in the same condition, repair and working order as when
new, ordinary wear and tear excepted, and in accordance with any manufacturer's
manual, and will forthwith, or in the case of any loss or damage to any of such
Equipment as soon as practicable after the occurrence thereof, make or cause to
be made all repairs, replacements and other improvements in connection therewith
that are necessary or desirable to such end. Each Pledgor will promptly furnish
to the Collateral Trustees and the Representatives a statement respecting any
loss or damage exceeding $5,000,000 to any of the Equipment or Inventory of such
Pledgor.

            (c) Each Pledgor will pay promptly when due all property and other
taxes, assessments and governmental charges or levies imposed upon, and all
claims (including, without limitation, claims for labor, materials and supplies)
against, the Equipment and Inventory of such Pledgor, except to the extent
payment thereof is not required by Section 7.06 the 5-Year Credit Agreement. In
producing its Inventory, each Pledgor will comply with all requirements of
applicable law, including, without limitation, to the extent applicable, the
Fair Labor Standards Act.

            SECTION 9. INSURANCE. (a) Each Pledgor will, at its own expense,
maintain insurance with respect to the Equipment and Inventory of such Pledgor
in such amounts, against such risks, in such form and with such insurers, as is
customarily maintained by companies similarly situated to such Pledgor. Each
such policy shall within a reasonable time follows the Perfection Date as
defined in the 5-Year Credit Agreement Amendment (i) name such Pledgor and the
Collateral Trustees as insured parties thereunder (without any representation or
warranty by or obligation upon the Collateral Trustees) as their interests may
appear, (ii) contain the agreement by the insurer that any loss thereunder shall
be payable to

<PAGE>
                                       16

the Collateral Trustees following notice from the Collateral Trustees of an
Actionable Default, notwithstanding any action, inaction or breach of
representation or warranty by such Pledgor, (iii) provide that there shall be no
recourse against the Collateral Trustees for payment of premiums or other
amounts with respect thereto and (iv) provide that at least 30 days' prior
written notice of cancellation or of lapse shall be given to the Collateral
Trustees by the insurer. Each Pledgor will, if so requested by the Collateral
Trustees, deliver to the Collateral Trustees original or duplicate policies of
such insurance and, as often as the Collateral Trustees may reasonably request,
a report of a reputable insurance broker with respect to such insurance.
Further, each Pledgor will, at the request of the Collateral Trustees, duly
execute and deliver instruments of assignment of such insurance policies to
comply with the requirements of Section 7 and cause the insurers to acknowledge
notice of such assignment.

            (b) Reimbursement under any liability insurance maintained by any
Pledgor pursuant to this Section 9 may be paid directly to the Person who shall
have incurred liability covered by such insurance. In case of any loss involving
damage to Equipment or Inventory when subsection (c) of this Section 9 is not
applicable, the applicable Pledgor will make or cause to be made the necessary
repairs to or replacements of such Equipment or Inventory, and any proceeds of
insurance properly received by or released to such Pledgor shall be used by such
Pledgor, except as otherwise required hereunder or by the Credit Agreements, to
pay or as reimbursement for the costs of such repairs or replacements.

            (c) So long as no Actionable Default shall have occurred and be
continuing, all insurance payments received by the Collateral Trustees in
connection with any loss, damage or destruction of any Inventory or Equipment
will be released by the Collateral Trustees to the applicable Pledgor. Upon the
occurrence and during the continuance of any Actionable Default, all insurance
payments in respect of such Equipment or Inventory shall be paid to the
Collateral Trustees and shall, in the Collateral Trustees' sole discretion, (i)
be released to the applicable Pledgor to be applied as set forth in the first
sentence of this subsection (c) or (ii) be held as additional Collateral
hereunder or applied as specified in Section 17(b).

            SECTION 10. PLACE OF PERFECTION; RECORDS; COLLECTION OF RECEIVABLES.
(a) Each Pledgor (i) will preserve its current place of organization and (ii)
will keep its chief executive office, originals of the Related Contracts to
which such Pledgor is a party and all originals of all chattel paper that
evidence Receivables of such Pledgor, at the locations therefor specified in
Section 6(a) or, upon 30 days' prior written notice to the Collateral Trustees,
at such other locations in a jurisdiction where all actions required by Section
7 shall have been taken with respect to the Collateral of such Pledgor (and,
upon the taking of such action in such jurisdiction, Schedule III hereto shall
be automatically amended to include such other locations). Each Pledgor will
hold and preserve its records relating to the Collateral, the Related Contracts
and chattel paper and will permit representatives of the Collateral Trustees at
any time during normal business hours to inspect and make abstracts from such
records and other documents.

            (b) Except as otherwise provided in this subsection (b), each
Pledgor will continue to collect, at its own expense, all amounts due or to
become due such Pledgor under the Receivables and the Related Contracts. In
connection with such collections, such Pledgor may take (and, at the Collateral
Trustees' direction, will take) such action as such Pledgor or the Collateral
Trustees may reasonably deem necessary or advisable to enforce collection of the
Receivables and the Related Contracts; PROVIDED, HOWEVER, that the Collateral
Trustees shall have the right at any time, upon the occurrence and during the
continuance of an Actionable Default and upon written notice to such Pledgor of
its intention to do so, to notify the Account Obligors under any Receivables or
Related Contracts of the assignment of such Receivables or Related Contracts to
the Collateral Trustees and to direct such Account Obligors to make payment of
all amounts due or to become due to such Pledgor thereunder directly to the
Collateral Trustees and, upon such notification and at the expense of such
Pledgor, to enforce collection of any such Receivables or Related Contracts, and
to adjust, settle or compromise the amount or payment thereof, in

<PAGE>
                                       17

the same manner and to the same extent as such Pledgor might have done. After
receipt by any Pledgor of the notice from the Collateral Trustees referred to in
the proviso to the preceding sentence, (i) all amounts and proceeds (including
instruments) received by such Pledgor in respect of the Receivables and the
Related Contracts of such Pledgor shall be received in trust for the benefit of
the Collateral Trustees hereunder, shall be segregated from other funds of such
Pledgor and shall be forthwith paid over to the Collateral Trustees in the same
form as so received (with any necessary indorsement) to be deposited in the
Collateral Account and (ii) such Pledgor will not adjust, settle or compromise
the amount or payment of any Receivable, release wholly or partly any Account
Obligor thereof, or allow any credit or discount thereon. No Pledgor will permit
or consent to the subordination of its right to payment under any of the
Receivables or the Related Contracts to any other indebtedness or obligations of
the Account Obligor thereof.

            SECTION 11. AS TO INTELLECTUAL PROPERTY COLLATERAL. (a) With respect
to each item of its Intellectual Property Collateral set forth on Schedule IV,
other than any Immaterial IP Collateral, each Pledgor agrees to take, at its
expense, all necessary steps, including, without limitation, in the U.S. Patent
and Trademark Office, the U.S. Copyright Office and any other governmental
authority, to (i) maintain the validity and enforceability of each such item of
Intellectual Property Collateral and maintain each such item of Intellectual
Property Collateral in full force and effect, and (ii) pursue the registration
and maintenance of each patent, trademark, or copyright registration or
application, now or hereafter included in such Intellectual Property Collateral
of such Pledgor, including, without limitation, the payment of required fees and
taxes, the filing of responses to office actions issued by the U.S. Patent and
Trademark Office, the U.S. Copyright Office or other governmental authorities,
the filing of applications for renewal or extension, the filing of affidavits
under Sections 8 and 15 of the U.S. Trademark Act, the filing of divisional,
continuation, continuation-in-part, reissue and renewal applications or
extensions, the payment of maintenance fees and the participation in
interference, reexamination, opposition, cancellation, infringement and
misappropriation proceedings. No Pledgor shall, without the written consent of
the Required Representatives, discontinue use of or otherwise abandon any
Intellectual Property Collateral, other than any Immaterial IP Collateral, or
abandon any right to file an application for letters patent, trademark, or
copyright, unless such Pledgor shall have previously determined that such use or
the pursuit or maintenance of such Intellectual Property Collateral is no longer
desirable in the conduct of such Pledgor's business and that the loss thereof
would not be reasonably likely to have a Material Adverse Effect (as defined in
the Credit Agreements), in which case, such Pledgor will give prompt notice of
any such abandonment to the Collateral Trustees and the Representatives.

            (b) Each Pledgor agrees promptly (and, in any case, on or prior to
the date of the next quarterly compliance certificate delivered pursuant to
Section 7.02(a) of the 5-Year Credit Agreement) to notify the Collateral
Trustees and the Representatives if such Pledgor learns (i) that any item of the
Intellectual Property Collateral may have become abandoned, placed in the public
domain, invalid or unenforceable, or of any adverse determination or development
regarding such Pledgor's ownership of any of the Intellectual Property
Collateral or its right to register the same or to keep and maintain and enforce
the same, or (ii) of any adverse determination or the institution of any
proceeding (including, without limitation, the institution of any proceeding in
the U.S. Patent and Trademark Office or any court) regarding any item of the
Intellectual Property Collateral.

            (c) Except with respect to any Immaterial IP Collateral, in the
event that any Pledgor becomes aware that any item of the Intellectual Property
Collateral is being infringed or misappropriated by a third party, such Pledgor
shall promptly (and, in any case, on or prior to the date of the next quarterly
compliance certificate delivered pursuant to Section 7.02(a) of the 5-Year
Credit Agreement) notify the Collateral Trustees and the Representatives and
shall take such actions, at its expense, as such Pledgor or the Required
Representatives deems reasonable and appropriate under the circumstances to
protect such

<PAGE>
                                       18

Intellectual Property Collateral, including, without limitation, suing for
infringement or misappropriation and for an injunction against such infringement
or misappropriation.

            (d) Each Pledgor shall use proper statutory notice in connection
with its use of each item of its Intellectual Property Collateral, other than
any Immaterial IP Collateral. No Pledgor shall do or permit any act or knowingly
omit to do any act whereby any of its Intellectual Property Collateral, other
than any Immaterial IP Collateral, may lapse or become invalid or unenforceable
or placed in the public domain.

            (e) Each Pledgor shall take all steps which it or the Collateral
Trustees or the Required Representatives deem reasonable and appropriate under
the circumstances to preserve and protect each item of its Intellectual Property
Collateral, other than any Immaterial IP Collateral, including, without
limitation, maintaining the quality of any and all products or services used or
provided in connection with any of the Trademarks, consistent with the quality
of the products and services as of the date hereof, and taking all steps
necessary to ensure that all licensed users of any of the Trademarks use such
consistent standards of quality.

            (f) With respect to its Intellectual Property Collateral, each
Pledgor agrees to execute an agreement, in substantially the form set forth in
Exhibit E hereto (an "INTELLECTUAL PROPERTY SECURITY AGREEMENT"), for recording
the security interest granted hereunder to the Collateral Trustees in such
Intellectual Property Collateral with the U.S. Patent and Trademark Office, the
U.S. Copyright Office and any other governmental authorities necessary to
perfect the security interest hereunder in such Intellectual Property
Collateral.

            (g) Each Pledgor agrees that, should it obtain an ownership interest
in any item of the type set forth in Section 1(f) which is not on the date
hereof a part of the Intellectual Property Collateral (the "AFTER-ACQUIRED
INTELLECTUAL PROPERTY"), (i) the provisions of Section 1 shall automatically
apply thereto, (ii) any such After-Acquired Intellectual Property and, in the
case of trademarks, the goodwill of the business connected therewith or
symbolized thereby, shall automatically become part of the Intellectual Property
Collateral subject to the terms and conditions of this Agreement with respect
thereto, (iii) such Pledgor shall give prompt (and, in any case, on or prior to
the date of the next quarterly compliance certificate delivered pursuant to
Section 7.02(a) of the 5-Year Credit Agreement) written notice thereof to the
Collateral Trustees in accordance herewith and (iv) such Pledgor shall execute
and deliver to the Collateral Trustees an IP Security Agreement Supplement in
substantially the form of Exhibit F hereto covering such After-Acquired
Intellectual Property as "Additional Collateral" thereunder and as defined
therein, and shall record such IP Security Agreement Supplement with the U.S.
Patent and Trademark Office, the U.S. Copyright Office and any other
governmental authorities necessary to perfect the security interest hereunder in
such After-Acquired Intellectual Property. The Schedules to each such IP
Security Agreement Supplement may indicate any such After-Acquired Intellectual
Property which such Pledgor shall have reasonably determined in good faith
constitutes Immaterial IP Collateral as provided pursuant to Section 6(k)(ix).

            SECTION 12. VOTING RIGHTS; DIVIDENDS; ETC. (a) So long as no
Actionable Default shall have occurred and be continuing:

            (i) Each Pledgor shall be entitled to exercise any and all voting
      and other consensual rights pertaining to any Security Collateral of such
      Pledgor for any purpose; PROVIDED, HOWEVER, that such Pledgor will not
      exercise or refrain from exercising any such right if such action would
      have a material adverse effect on the value of such Security Collateral.

<PAGE>
                                       19

            (ii) Each Pledgor shall be entitled to receive and retain any and
      all dividends, interest and other distributions paid in respect of the
      Security Collateral of such Pledgor if and to the extent that the payment
      thereof is not otherwise prohibited by the terms of the Secured
      Agreements; PROVIDED, HOWEVER, that any and all dividends, interest and
      other distributions paid or payable other than in cash in respect of, and
      instruments and other property received, receivable or otherwise
      distributed in respect of, or in exchange for, any Security Collateral,
      shall be, and shall be forthwith delivered to the Collateral Trustees to
      hold as, Security Collateral and shall, if received by such Pledgor, be
      received in trust for the benefit of the Collateral Trustees, be
      segregated from the other property or funds of such Pledgor and be
      forthwith delivered to the Collateral Trustees as Security Collateral in
      the same form as so received (with any necessary indorsement).

            (iii) The Collateral Trustees will execute and deliver (or cause to
      be executed and delivered) to each Pledgor all such proxies and other
      instruments as such Pledgor may reasonably request for the purpose of
      enabling such Pledgor to exercise the voting and other rights that it is
      entitled to exercise pursuant to paragraph (i) above and to receive the
      dividends or interest payments that it is authorized to receive and retain
      pursuant to paragraph (ii) above.

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

            (i) All rights of each Pledgor (x) to exercise or refrain from
      exercising the voting and other consensual rights that it would otherwise
      be entitled to exercise pursuant to Section 12(a)(i) shall, upon notice to
      such Pledgor by the Collateral Trustees, cease and (y) to receive the
      dividends, interest and other distributions that it would otherwise be
      authorized to receive and retain pursuant to Section 12(a)(ii) shall
      automatically cease, and all such rights shall thereupon become vested in
      the Collateral Trustees, which shall thereupon have the sole right to
      exercise or refrain from exercising such voting and other consensual
      rights and to receive and hold as Security Collateral such dividends,
      interest and other distributions.

            (ii) All dividends, interest and other distributions that are
      received by any Pledgor contrary to the provisions of paragraph (i) of
      this Section 12(b) shall be received in trust for the benefit of the
      Collateral Trustees, shall be segregated from other funds of such Pledgor
      and shall be forthwith paid over to the Collateral Trustees as Security
      Collateral in the same form as so received (with any necessary
      indorsement).

            (iii) The Collateral Trustees shall be authorized to send to each
      Securities Intermediary as defined in and under any Control Agreement a
      Notice of Exclusive Control as defined in and under such Control
      Agreement.

            SECTION 13. TRANSFERS AND OTHER LIENS; ADDITIONAL SHARES. (a) Each
Pledgor agrees that it will not (i) sell, assign or otherwise dispose of, or
grant any option with respect to, any of the Collateral, other than sales,
assignments and other dispositions of Collateral, and options relating to
Collateral, permitted under the terms of the Secured Agreements, or (ii) create
or suffer to exist any Lien upon or with respect to any of the Collateral of
such Pledgor, except for the pledge, assignment and security interest created
under this Agreement and Liens permitted under the Secured Agreements.

            (b) Each Pledgor agrees that it will (i) cause each issuer of the
Pledged Shares pledged by such Pledgor not to issue any stock or other
securities in addition to or in substitution for the Pledged Shares issued by
such issuer, except to such Pledgor, and (ii) pledge hereunder, immediately upon
its acquisition (directly or indirectly) thereof, any and all additional shares
of stock or other securities of each issuer of the Pledged Shares.

<PAGE>
                                       20

            SECTION 14. COLLATERAL TRUSTEES APPOINTED ATTORNEY-IN-FACT. Each
Pledgor hereby irrevocably appoints the Collateral Trustees such Pledgor's
attorneys-in-fact, with full authority in the place and stead of such Pledgor
and in the name of such Pledgor or otherwise, from time to time, upon the
occurrence and during the continuance of an Actionable Default, in the
Collateral Trustees' discretion, to take any action and to execute any
instrument that the Collateral Trustees may deem necessary or advisable to
accomplish the purposes of this Agreement, including, without limitation:

            (a) to obtain and adjust insurance required to be paid to the
      Collateral Trustees pursuant to Section 9,

            (b) to ask for, demand, collect, sue for, recover, compromise,
      receive and give acquittance and receipts for moneys due and to become due
      under or in respect of any of the Collateral,

            (c) to receive, indorse and collect any drafts or other instruments,
      documents and chattel paper, in connection with clause (a) or (b) above,
      and

            (d) to file any claims or take any action or institute any
      proceedings that the Collateral Trustees may deem necessary or desirable
      for the collection of any of the Collateral or otherwise to enforce
      compliance with the terms and conditions of any Related Contract or the
      rights of the Collateral Trustees with respect to any of the Collateral.

            SECTION 15. COLLATERAL TRUSTEES MAY PERFORM. If any Pledgor fails to
perform any agreement contained herein, the Collateral Trustees may, but without
any obligation to do so and without notice, itself perform, or cause performance
of, such agreement, and the expenses of the Collateral Trustees incurred in
connection therewith shall be payable by the Borrowers under Section 18(b).

            SECTION 16. COLLATERAL TRUSTEES' DUTIES. The powers conferred on the
Collateral Trustees hereunder are solely to protect the Secured Holders'
interest in the Collateral and shall not impose any duty upon it to exercise any
such powers. Except for the safe custody of any Collateral in its possession and
the accounting for moneys actually received by it hereunder, the Collateral
Trustees shall have no duty as to any Collateral, as to ascertaining or taking
action with respect to calls, conversions, exchanges, maturities, tenders or
other matters relative to any Collateral, whether or not any Secured Holder has
or is deemed to have knowledge of such matters, or as to the taking of any
necessary steps to preserve rights against any parties or any other rights
pertaining to any Collateral. The Collateral Trustees shall be deemed to have
exercised reasonable care in the custody and preservation of any Collateral in
their possession if such Collateral is accorded treatment substantially equal to
that which they accord their own property.

            SECTION 17. REMEDIES. If any Actionable Default shall have occurred
and be continuing:

            (a) The Collateral Trustees may exercise in respect of the
      Collateral, in addition to other rights and remedies provided for herein
      or otherwise available to them, all the rights and remedies of a secured
      party upon default under the N.Y. Uniform Commercial Code (whether or not
      the N.Y. Uniform Commercial Code applies to the affected Collateral) and
      also may: (i) require each Pledgor to, and each Pledgor hereby agrees that
      it will at its expense and upon request of the Collateral Trustees
      forthwith, assemble all or part of the Collateral as directed by the
      Collateral Trustees and make it available to the Collateral Trustees at a
      place and time to be designated by the Collateral Trustees that is
      reasonably convenient to both parties; (ii) without notice except as
      specified below, sell the Collateral or any part thereof in one or more
      parcels at

<PAGE>
                                       21

      public or private sale, at any of the Collateral Trustees' offices or
      elsewhere, for cash, on credit or for future delivery, and upon such other
      terms as the Collateral Trustees may deem commercially reasonable; (iii)
      occupy any premises owned or leased by any of the Pledgors where the
      Collateral or any part thereof is assembled or located for a reasonable
      period in order to effectuate its rights and remedies hereunder or under
      law, without obligation to such Pledgor in respect of such occupation; and
      (iv) exercise any and all rights and remedies of any of the Pledgors under
      or in connection with the Receivables and the Related Contracts or
      otherwise in respect of the Collateral, including, without limitation, any
      and all rights of such Pledgor to demand or otherwise require payment of
      any amount under, or performance of any provision of, the Receivables and
      the Related Contracts. Each Pledgor agrees that, to the extent notice of
      sale shall be required by law, at least ten days' notice to such Pledgor
      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
      Collateral Trustees shall not be obligated to make any sale of Collateral
      regardless of notice of sale having been given. The Collateral Trustees
      may adjourn any public or private sale from time to time by announcement
      at the time and place fixed therefor, and such sale may, without further
      notice, be made at the time and place to which it was so adjourned.

            (b) Any cash held by or on behalf of the Collateral Trustees and all
      cash proceeds received by or on behalf of the Collateral Trustees in
      respect of any sale of, collection from, or other realization upon all or
      any part of the Collateral may be deposited to the Collateral Account and
      disbursed pursuant to the Collateral Trust Agreement.

            (c) All payments received by any Pledgor under or in connection with
      any Receivables or Related Contracts or otherwise in respect of the
      Collateral shall be received in trust for the benefit of the Collateral
      Trustees, shall be segregated from other funds of such Pledgor and shall
      be forthwith paid over to the Collateral Trustees in the same form as so
      received (with any necessary indorsement).

            (d) The Collateral Trustees may, without notice to any Pledgor,
      except as required by law and at any time or from time to time, charge,
      set-off and otherwise apply all or any part of the Secured Obligations
      against any funds held in the Collateral Account or in any deposit account
      related thereto.

            (e) In the event of any sale or other disposition of any of the
      Intellectual Property Collateral of any Pledgor, the goodwill of the
      business connected with, and symbolized by, any Trademarks subject to such
      sale or other disposition shall be included therein, and such Pledgor
      shall supply to the Collateral Trustees or its designee such Pledgor's
      know-how and expertise, and documents and things relating to any
      Intellectual Property Collateral subject to such sale or other
      disposition, and such Pledgor's customer lists and other records and
      documents relating to such Intellectual Property Collateral and to the
      manufacture, distribution, advertising and sale of products and services
      of such Pledgor.

            SECTION 18. INDEMNITY AND EXPENSES. (a) Each Borrower agrees to
indemnify, defend and save and hold harmless each Collateral Trustee, each
Representative and each Secured Holder and each of their Affiliates and their
respective officers, directors, employees, agents and advisors (each, an
"INDEMNIFIED PARTY") from and against, and shall pay on demand, any and all
claims, damages, losses, liabilities and expenses (including, without
limitation, reasonable fees and expenses of counsel) that may be incurred by or
asserted or awarded against any Indemnified Party, in each case arising out of
or in connection with or resulting from this Agreement (including, without
limitation, enforcement of this Agreement), except to the extent such claim,
damage, loss, liability or expense is found in a final, non-

<PAGE>
                                       22

appealable judgment by a court of competent jurisdiction to have resulted from
such Indemnified Party's gross negligence or willful misconduct.

            (b) Each Borrower will upon demand pay to each Collateral Trustee
the amount of any and all reasonable expenses, including, without limitation,
the reasonable fees and expenses of its counsel and of any experts and agents,
that such Collateral Trustee may incur in connection with (i) the administration
of this Agreement, (ii) the custody, preservation, use or operation of, or the
sale of, collection from or other realization upon, any of the Collateral of
such Pledgor, (iii) the exercise or enforcement of any of the rights of such
Collateral Trustee any Representative or any Secured Holder hereunder or (iv)
the failure by such Pledgor to perform or observe any of the provisions hereof.

            SECTION 19. AMENDMENTS; WAIVERS; ADDITIONAL PLEDGORS; ETC. (a) No
amendment or waiver of any provision of this Agreement, and no consent to any
departure by any Pledgor herefrom, shall in any event be effective unless the
same shall be in writing and signed by the Collateral Trustees, and then such
waiver or consent shall be effective only in the specific instance and for the
specific purpose for which given. No failure on the part of the Collateral
Trustees or any other Secured Holder to exercise, and no delay in exercising any
right hereunder, shall operate as a waiver thereof; nor shall any single or
partial exercise of any such right preclude any other or further exercise
thereof or the exercise of any other right.

            (b) Upon the execution and delivery by any Person of a security
agreement supplement in substantially the form of Exhibit A hereto (each a
"SECURITY AGREEMENT SUPPLEMENT"), (i) such Person shall be referred to as an
"ADDITIONAL PLEDGOR" and shall be and become a Pledgor hereunder and each
reference in this Agreement and the other Loan Documents to "Pledgor" shall also
mean and be a reference to such Additional Pledgor, and (ii) the supplemental
schedules I, II, III, IV and V attached to each Security Agreement Supplement
shall be incorporated into and become a part of and supplement Schedules I, II,
III, IV and V, respectively, hereto, and the Collateral Trustees may attach such
supplemental schedules to such Schedules; and each reference to such Schedules
shall mean and be a reference to such Schedules as supplemented pursuant to each
Security Agreement Supplement.

            SECTION 20. NOTICES; ETC. All notices and other communications
provided for hereunder shall be in writing (including telegraphic, telecopier or
telex communication) and mailed, telegraphed, telecopied, telexed or delivered
as provided in the Collateral Trust Agreement.

            SECTION 21. CONTINUING SECURITY INTEREST; ASSIGNMENTS UNDER THE
CREDIT AGREEMENTS. This Agreement shall create a continuing security interest in
the Collateral and shall (a) remain in full force and effect until released as
provided in Section 8.02 of the Collateral Trust Agreement, (b) be binding upon
each Pledgor, its successors and assigns and (c) inure, together with the rights
and remedies of the Collateral Trustees hereunder, to the equal and ratable
benefit of the Secured Holders and their respective successors, transferees and
assigns. Without limiting the generality of the foregoing clause (c), any Credit
Party may assign or otherwise transfer all or any portion of its rights and
obligations under each of the Credit Agreements (including, without limitation,
all or any portion of its Commitments, the Loans owing to it and the Note or
Notes, if any, held by it) to any other Person, and such other Person shall
thereupon become vested with all the benefits in respect thereof granted to such
Credit Party herein or otherwise, in each case as provided in the applicable
provisions of each of the Credit Agreements.

            SECTION 22. RELEASE; TERMINATION. All or any portion of the
Collateral shall be released by the Collateral Trustees solely on the terms and
subject to the conditions set forth in Article VIII of the Collateral Trust.

<PAGE>
                                       23

            SECTION 23. SECURITY INTEREST ABSOLUTE. The obligations of each
Pledgor (other than any Borrower) under this Agreement are independent of the
Secured Obligations of any Borrower under or in respect of the Secured
Agreements, and a separate action or actions may be brought and prosecuted
against each such Pledgor to enforce this Agreement, irrespective of whether any
action is brought against any Borrower or whether such Pledgor or any other
Pledgor is joined in any such action or actions. All rights of the Collateral
Trustees, the Representatives and the other Secured Holders and the pledge,
assignment and security interest hereunder, and all obligations of each such
Pledgor hereunder, shall be irrevocable, absolute and unconditional irrespective
of, and each such Pledgor hereby irrevocably waives (to the maximum extent
permitted by applicable law) any defenses it may now have or may hereafter
acquire in any way relating to, any or all of the following:

            (a) any lack of validity or enforceability of any Secured Agreement
      or any other agreement or instrument relating thereto;

            (b) any change in the time, manner or place of payment of, or in any
      other term of, all or any of the Secured Obligations of any Borrower under
      or in respect of the Secured Agreements or any other amendment or waiver
      of or any consent to any departure from any Secured Agreement, including,
      without limitation, any increase in the Secured Obligations resulting from
      the extension of additional credit to any Borrower or any of its
      Subsidiaries or otherwise;

            (c) any taking, exchange, release or non-perfection of any
      Collateral or any other collateral, or any taking, release or amendment or
      waiver of or consent to departure from any guaranty, for all or any of the
      Secured Obligations;

            (d) any manner of application of any Collateral or any other
      collateral, or proceeds thereof, to all or any of the Secured Obligations,
      or any manner of sale or other disposition of any Collateral or any other
      collateral for all or any of the Secured Obligations under or in respect
      of the Secured Agreements or any other assets of any Borrower or any of
      its Subsidiaries;

            (e) any change, restructuring or termination of the corporate
      structure or existence of any Borrower or any of its Subsidiaries;

            (f) any failure of any Secured Holder or any Representative to
      disclose to any Pledgor any information relating to the business,
      condition (financial or otherwise), operations, performance, assets,
      nature of assets, liabilities or prospects of any other Pledgor now or
      hereafter known to such Secured Holder or such Representative (each
      Pledgor waiving any duty on the part of the Secured Holders or any
      Representative to disclose such information);

            (g) the failure of any other Person to execute this Agreement or any
      other Collateral Document, guaranty or agreement or the release or
      reduction of liability of any Pledgor with respect to the Secured
      Obligations; or

            (h) any other circumstance (including, without limitation, any
      statute of limitations) or any existence of or reliance on any
      representation by any Secured Holder that might otherwise constitute a
      defense available to, or a discharge of, such Pledgor or any other Pledgor
      or a third party pledgor of a security interest.

This Agreement shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Secured Obligations is rescinded or
must otherwise be returned by any Secured

<PAGE>
                                       24

Holder or by any other Person upon the insolvency, bankruptcy or reorganization
of any Borrower or otherwise, all as though such payment had not been made.

            SECTION 24. EXECUTION IN COUNTERPARTS. This Agreement may be
executed in any number of counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement. Delivery of an executed counterpart of a signature page
to this Agreement by telecopier shall be effective as delivery of an original
executed counterpart of this Agreement.

            SECTION 25. MORTGAGES. In the event that any of the Collateral
hereunder is also subject to a valid and enforceable Lien under the terms of any
mortgage and the terms of such mortgage are inconsistent with the terms of this
Agreement, then with respect to such Collateral, the terms of such mortgage
shall be controlling in the case of fixtures and real estate leases, letting and
licenses of, and contracts and agreements relating to the lease of, real
property, and the terms of this Agreement shall be controlling in the case of
all other Collateral.

            SECTION 26. GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.

<PAGE>
                                       25

            IN WITNESS WHEREOF, each Pledgor has caused this Agreement to be
duly executed and delivered by its officer thereunto duly authorized as of the
date first above written.

                                          AMES TRUE TEMPER PROPERTIES, INC.
                                          AMES TRUE TEMPER, INC.
                                          ARCHITECTURAL AREA LIGHTING, INC.
                                          ARROW CONSOLIDATED CORPORATION
                                          ASTERIA COMPANY
                                          BATHCRAFT INC.
                                          BAYLIS BROTHERS, INC.
                                          BRUCKNER MANUFACTURING CORP.
                                          CARLSBAD CORP.
                                          COLUMBIA LIGHTING, INC.
                                          COLUMBIA LIGHTING-LCA, INC.
                                          COLUMBIA LIGHTING MFG., CO.
                                          COLUMBIA LIGHTING PROPERTIES, INC.
                                          COLUMBIA MATERIALS, LLC
                                          COMPAX CORP.
                                          DUAL-LITE  INC.
                                          DUAL-LITE MANUFACTURING, INC.
                                          ELJER INDUSTRIES, INC.
                                          ELJER PLUMBINGWARE, INC.
                                          ENVIRONMENTAL ENERGY COMPANY
                                          EZ HOLDINGS, INC.
                                          GARY CONCRETE PRODUCTS, INC.
                                          GATSBY SPAS, INC.
                                          HL CAPITAL CORP.
                                          IXL MANUFACTURING COMPANY, INC.
                                          JACUZZI INC.
                                          JACUZZI WHIRLPOOL BATH, INC.
                                          JUSI HOLDINGS, INC.
                                          KIM LIGHTING INC.
                                          KLI, INC.
                                          LCA GROUP INC.
                                          LCA (NS) INC.
                                          LIGHTING CORPORATION OF AMERICA, INC.
                                          LOKELANI DEVELOPMENT CORPORATION
                                          LUXOR INDUSTRIES, INC.
                                          MAILI KAI LAND DEVELOPMENT CORPORATION
                                          MOBILITE INC.
                                          NEPCO OF AUSTRALIA, INC.
                                          NEPCO OF CANADA, INC.
                                          NEPCO OF FORD HEIGHTS, INC.
                                          NEPCO OF FULTON, INC.
                                          NEPCO OF PAKISTAN, INC.
                                          NISSEN UNIVERSAL HOLDINGS INC.
                                          OUTDOOR PRODUCTS LLC
                                          PH PROPERTY DEVELOPMENT COMPANY

<PAGE>
                                       26

                                          PRESCOLITE  LITE  CONTROLS, INC.
                                          PRESCOLITE, INC.
                                          PROGRESS LIGHTING, INC.
                                          PROGRESSIVE LIGHTING, INC. (NC)
                                          PROGRESSIVE LIGHTING, INC. (SC)
                                          PROGRESS LIGHTING PROPERTIES, INC.
                                          REDMONT, INC.
                                          SANITARY-DASH MANUFACTURING CO., INC
                                          SELKIRK CANADA U.S.A., INC.
                                          SELKIRK EUROPE U.S.A., INC.
                                          SELKIRK, INC.
                                          SPAULDING LIGHTING, INC.
                                          STRATEGIC CAPITAL MANAGEMENT, INC.
                                          STREAMWOOD CORPORATION
                                          SUNDANCE SPAS, INC.
                                          TA LIQUIDATION CORP.
                                          TRIMFOOT CO.
                                          TT LIQUIDATION CORP.
                                          UGE LIQUIDATION INC.
                                          UNITED STATES BRASS CORP.
                                          U.S. INDUSTRIES, INC.
                                          USI AMERICAN HOLDINGS, INC.
                                          USI ATLANTIC CORP.
                                          USI CAPITAL, INC.
                                          USI FUNDING, INC.
                                          USI GLOBAL CORP.
                                          USI PROPERTIES, INC.
                                          USI REALTY CORP.
                                          ZURCO, INC.
                                          ZURNACQ OF CALIFORNIA, INC.
                                          ZURN (CAYMAN ISLANDS), INC.
                                          ZURN CONSTRUCTORS, INC.
                                          ZURN DEVCO, INC.
                                          ZURN EPC SERVICES, INC.
                                          ZURN GOLF HOLDING CORPORATION
                                          ZURN INDUSTRIES, INC.

                                          By
                                            ----------------------------------
                                             Name: Steven C. Barre
                                             Title:   Vice President

<PAGE>

                                                    SCHEDULE I TO THE PLEDGE AND
                                                              SECURITY AGREEMENT

                PLEDGED SHARES; PLEDGED DEBT; SECURITIES ACCOUNTS

                                     PART A

                                 PLEDGED SHARES

===============================================================================

                                                               PERCENTAGE
                                           STOCK                   OF
              STOCK    CLASS OF    PAR   CERTIFICATE  NUMBER   OUTSTANDING
  PLEDGOR    ISSUER     STOCK     VALUE    NO(S)     OF SHARES    SHARES
===============================================================================

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

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

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

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

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

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

===============================================================================

                                     PART B

                                  PLEDGED DEBT

================================================================================

                                                                    OUTSTANDING
              DEBT    DESCRIPTION OF   DEBT CERTIFICATE   FINAL      PRINCIPAL
 PLEDGOR     ISSUER        DEBT             NO(S).       MATURITY     AMOUNT
================================================================================

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

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

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

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

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

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

================================================================================

<PAGE>

                                     PART C

                               SECURITIES ACCOUNTS

================================================================================

                     NAME AND ADDRESS OF                 SECURITIES ACCOUNT
    PLEDGOR     SECURITIES ACCOUNT INSTITUTION             NAME AND NUMBER
================================================================================

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

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

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

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

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

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

================================================================================

<PAGE>

                                                   SCHEDULE II TO THE PLEDGE AND
                                                              SECURITY AGREEMENT

                      LOCATIONS OF EQUIPMENT AND INVENTORY

[NAME OF PLEDGOR]

      A.    OWNED LOCATIONS:

      B.    LEASED LOCATIONS:

      C.    OTHER LOCATIONS (DESCRIBE):

[NAME OF PLEDGOR]

      A.    OWNED LOCATIONS:

      B.    LEASED LOCATIONS:

      C.    OTHER LOCATIONS (DESCRIBE):

[ETC.]

<PAGE>

                                                  SCHEDULE III TO THE PLEDGE AND
                                                              SECURITY AGREEMENT

                  CHIEF EXECUTIVE OFFICE, PLACE OF ORGANIZATION
                      AND FEDERAL TAX IDENTIFICATION NUMBER

                                                       FEDERAL TAX
PLEDGOR         JURISDICTION OF     CHIEF EXECUTIVE    IDENTIFICATION
                ORGANIZATION             OFFICE        NUMBER

<PAGE>

                                                   SCHEDULE IV TO THE PLEDGE AND
                                                              SECURITY AGREEMENT

                             PATENTS, TRADEMARKS AND
                      TRADE NAMES, COPYRIGHTS AND LICENSES

                                     PART A

  PLEDGOR     PATENTS   COUNTRY  PATENT NO. APPLIC. NO. FILING DATE ISSUE DATE
  -------     -------   -------  ---------- ----------- ----------- ----------

                                     PART B

             TRADEMARKS AND                   REG.    APPLIC. FILING   ISSUE
             ---------------                  -----   ------- ------   -----
  PLEDGOR      TRADE NAMES     COUNTRY  MARK    NO.     NO.    DATE     DATE
  -------      -----------     -------  ----    ---     ---    ----     ----

                                     PART C

                                                                FILING  ISSUE
  PLEDGOR    COPYRIGHTS  COUNTRY   TITLE  REG. NO.  APPLIC. NO.  DATE   DATE
  -------    ----------  -------   -----  --------  -----------  ----   ----

                                     PART D

  PLEDGOR     LICENSES      TITLE       DATE       PARTIES
  -------     --------      -----       ----       -------

<PAGE>

                                                    SCHEDULE V TO THE PLEDGE AND
                                                              SECURITY AGREEMENT

                                PLEDGED ACCOUNTS

==========================================================

                 NAME AND ADDRESS OF
    PLEDGOR      PLEDGED ACCOUNT BANK    ACCOUNT NUMBER
==========================================================

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

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

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

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

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

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

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

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

==========================================================

<PAGE>

                                                   SCHEDULE VI TO THE PLEDGE AND
                                                              SECURITY AGREEMENT

                          EXISTING SECURITY INSTRUMENTS

<PAGE>

                                                            S&S DRAFT:  04/30/01

                          PLEDGE AND SECURITY AGREEMENT

                           Dated as of April 30, 2001,

                                      From

                         The Pledgors referred to herein

                                   AS PLEDGORS

                                       to

                           [WILMINGTON TRUST COMPANY]

                             AS COLLATERAL TRUSTEES

<PAGE>

                          T A B L E  O F  C O N T E N T S

SECTION                                                                   PAGE

Section 1.  GRANT OF SECURITY................................................3

Section 2.  SECURITY FOR SECURED OBLIGATIONS.................................8

Section 3.  PLEDGORS REMAIN LIABLE...........................................8

Section 4.  DELIVERY AND CONTROL OF SECURITY COLLATERAL......................9

Section 5.  MAINTAINING THE PLEDGED ACCOUNTS................................10

Section 6.  REPRESENTATIONS AND WARRANTIES..................................10

Section 7.  FURTHER ASSURANCES..............................................14

Section 8.  AS TO EQUIPMENT AND INVENTORY...................................15

Section 9.  INSURANCE.......................................................15

Section 10. PLACE OF PERFECTION; RECORDS; COLLECTION OF RECEIVABLES.........16

Section 11. AS TO INTELLECTUAL PROPERTY COLLATERAL..........................17

Section 12. VOTING RIGHTS; DIVIDENDS; ETC...................................18

Section 13. TRANSFERS AND OTHER LIENS; ADDITIONAL SHARES....................19

Section 14. COLLATERAL TRUSTEES APPOINTED ATTORNEY-IN-FACT..................20

Section 15. COLLATERAL TRUSTEES MAY PERFORM.................................20

Section 16. COLLATERAL TRUSTEES' DUTIES.....................................20

Section 17. REMEDIES........................................................20

Section 18. INDEMNITY AND EXPENSES..........................................21

Section 19. AMENDMENTS; WAIVERS; ADDITIONAL PLEDGORS; ETC...................22

Section 20. NOTICES; ETC....................................................22

Section 21. CONTINUING SECURITY INTEREST; ASSIGNMENTS UNDER THE CREDIT
     AGREEMENTS.............................................................22

Section 22. RELEASE; TERMINATION............................................22

Section 23. SECURITY INTEREST ABSOLUTE......................................23

Section 24. EXECUTION IN COUNTERPARTS.......................................24

<PAGE>

Section 25. MORTGAGES.......................................................24

Section 26. GOVERNING LAW...................................................24

Schedules

Schedule I     -  Pledged Shares; Pledged Debt; and Securities Accounts
Schedule II    -  Locations of Equipment and Inventory
Schedule III   -  Chief Executive Office; Jurisdiction of Organization; and
                  Federal Tax Identification Number
Schedule IV    -  Patents, Trademarks and Trade Names, Copyrights and Licenses
Schedule V     -  Pledged Accounts
Schedule VI    -  Existing Security Instruments

Exhibits

Exhibit A      -  Form of Security Agreement Supplement
Exhibit B      -  Form of Pledged Account Letter
Exhibit C      -  Form of Landlord's Consent and Agreement
Exhibit D      -  Form of Control Agreement (Securities Account)
Exhibit E      -  Form of Intellectual Property Security Agreement
Exhibit F      -  Form of Intellectual Property Security Agreement Supplement

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