Document:

Exhibit
10.7

 

SECURITY
AGREEMENT

 

THIS SECURITY AGREEMENT,
dated as of June 30, 2004, is made and entered into by and between: THE
WORNICK COMPANY, a Delaware corporation, RIGHT AWAY MANAGEMENT CORPORATION, a
Delaware corporation, THE WORNICK COMPANY RIGHT AWAY DIVISION, a Delaware
corporation, and THE WORNICK COMPANY RIGHT AWAY DIVISION, L.P., a Delaware
limited partnership (collectively, the “Debtor”); and TEXAS STATE BANK, a Texas
banking corporation (the “Secured Party”).

 

WHEREAS, Debtor and TWC
Holding, LLC, a Delaware limited liability company, have entered into a Loan
Agreement with the Secured Party dated as of even date herewith (as amended and
in effect from time to time, the “Loan Agreement”); and

 

WHEREAS, the Secured
Party, subject to the terms and conditions contained in the Loan Agreement, has
agreed to make loans to THE WORNICK COMPANY, a Delaware corporation (the
“Obligor”), as further described in the Loan Agreement(collectively, the
“Loan”); and

 

WHEREAS, it is a
condition precedent to the Secured Party’s making the Loan to the Obligor that
the Debtor execute and deliver to the Secured Party a security agreement in
substantially the form hereof; and

 

WHEREAS, the Debtor
wishes to grant a security interest in favor of the Secured Party as herein
provided to secure all Obligations (as defined in the Loan Agreement) to
Secured Party.

 

NOW, THEREFORE, in
consideration of the promises contained herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:

 

1.                                      
Definitions. All
capitalized terms used herein without definitions shall have the respective
meanings provided therefor in the Loan Agreement. The term “State,” as used
herein, means the State of Texas. All terms defined in the Uniform Commercial
Code of the State and used herein not otherwise defined in the Loan Agreement
or this Security Agreement shall have the same definitions herein as specified
therein.

 

2.                                      
Grant of Security
Interest. The Debtor hereby grants to the Secured Party, to secure the payment
and performance in full of all the Obligations, a security interest in and so
pledges and assigns to the Secured Party, all assets and rights of the Debtor,
wherever located, whether now owned or hereafter acquired or arising, and all
proceeds and products thereof, including Cash, Deposit Accounts, Accounts
Receivable, Contracts, Inventory, Equipment, Fixed Assets, Parts Inventory,
instruments, documents, chattel paper (whether tangible or electronic),
letter-of-credit rights (whether or not the letter of credit is evidenced by a
writing), commercial tort claims, securities and all other investment property,
supporting obligations, Fixtures, Intangibles, leasehold interest in the
Property, and insurance claims and proceeds, and the Ownership Interests held
by Debtor, all of the foregoing hereinafter called the “Collateral.”  The
Secured Party acknowledges that 

 

 

the attachment of its security interest in any
additional commercial tort claim as original collateral is subject to the
Debtor’s compliance with Section 4.7.

 

3.                                      
Authorization to File
Financing Statements. The Debtor hereby irrevocably authorizes the Secured
Party at any time and from time to time to file in any filing office in any
Uniform Commercial Code jurisdiction any initial financing statements and
amendments thereto that (a) indicate the Collateral (i) as all assets of the
Debtor or words of similar effect, regardless of whether any particular asset
comprised in the Collateral falls within the scope of Article 9 of the
Uniform Commercial Code of the State or such jurisdiction, or (ii) as being of
an equal or lesser scope or with greater detail, and (b) provide any other
information required by part 5 of Article 9 of the Uniform Commercial Code
of the State, or such other jurisdiction, for the sufficiency or filing office
acceptance of any financing statement or amendment, including (i) whether the
Debtor is an organization, the type of organization and any organizational
identification number issued to the Debtor and, (ii) in the case of a financing
statement filed as a fixture filing or indicating Collateral as as-extracted
collateral or timber to be cut, a sufficient description of real property to
which the Collateral relates. The Debtor agrees to furnish any such information
to the Secured Party promptly upon the Secured Party’s request. The Debtor also
ratifies its authorization for the Secured Party to have filed in any Uniform
Commercial Code jurisdiction any like initial financing statements or
amendments thereto if filed prior to the date hereof.

 

4.                                      
Other Actions. To further
the attachment, perfection and first priority of, and the ability of the
Secured Party to enforce, the Secured Party’s security interest in the
Collateral, and without limitation on the Debtor’s other obligations in this
Agreement, the Debtor agrees, in each case at the Debtor’s expense, to take the
following actions with respect to the following Collateral:

 

4.1.                             
Promissory Notes and
Tangible Chattel Paper. If the Debtor shall at any time hold or acquire any
promissory notes or tangible chattel paper, the Debtor shall forthwith endorse,
assign and deliver the same to the Secured Party, accompanied by such
instruments of transfer or assignment duly executed in blank as the Secured
Party may from time to time specify.

 

4.2.                             
Deposit Accounts. For
each deposit account that the Debtor at any time opens or maintains, the Debtor
shall, at the Secured Party’s request and option, pursuant to an agreement in
form and substance satisfactory to the Secured Party, either (a) cause the
depositary bank to comply at any time with instructions from the Secured Party
to such depositary bank directing the disposition of funds from time to time
credited to such deposit account, without further consent of the Debtor, or (b)
arrange for the Secured Party to become the customer of the depositary bank
with respect to the deposit account, with the Debtor being permitted, only with
the consent of the Secured Party, to exercise rights to withdraw funds from
such deposit account. The provisions of this paragraph shall not apply to (i)
any deposit account for which the Debtor, the depositary bank and the Secured
Party have entered into a cash collateral agreement specially negotiated among
the Debtor, the depositary bank and the Secured Party for the specific purpose
set forth therein, (ii) a deposit account for which the Secured Party is the
depositary bank and is in automatic control, and (iii) deposit accounts
specially and exclusively used for payroll, payroll taxes and other employee
wage and benefit payments to or for the benefit of the Debtor’s salaried
employees.

 

2

 

4.3.                             
Investment Property.
If the Debtor shall at any time hold or acquire any certificated securities,
the Debtor shall forthwith endorse, assign and deliver the same to the Secured
Party, accompanied by such instruments of transfer or assignment duly executed
in blank as the Secured Party may from time to time specify. If any securities
now or hereafter acquired by the Debtor are uncertificated and are issued to
the Debtor or its nominee directly by the issuer thereof, the Debtor shall
immediately notify the Secured Party thereof and, at the Secured Party’s
request and option, pursuant to an agreement in form and substance satisfactory
to the Secured Party, either (a) cause the issuer to agree to comply with
instructions from the Secured Party as to such securities, without further
consent of the Debtor or such nominee, or (b) arrange for the Secured Party to
become the registered owner of the securities. If any securities, whether
certificated or uncertificated, or other investment property now or hereafter
acquired by the Debtor are held by the Debtor or its nominee through a
securities intermediary or commodity intermediary, the Debtor shall immediately
notify the Secured Party thereof and, at the Secured Party’s request and
option, pursuant to an agreement in form and substance satisfactory to the
Secured Party, either (i) cause such securities intermediary or (as the case
may be) commodity intermediary to agree to comply with entitlement orders or
other instructions from the Secured Party to such securities intermediary as to
such securities or other investment property, or (as the case may be) to apply
any value distributed on account of any commodity contract as directed by the
Secured Party to such commodity intermediary, in each case without further
consent of the Debtor or such nominee, or (ii) in the case of financial assets
or other investment property held through a securities intermediary, arrange
for the Secured Party to become the entitlement holder with respect to such
investment property, with the Debtor being permitted, only with the consent of
the Secured Party, to exercise rights to withdraw or otherwise deal with such
investment property.  The provisions of this paragraph shall not apply to
any financial assets credited to a securities account for which the Secured
Party is the securities intermediary.

 

4.4.                             
Collateral in the Possession
of a Bailee. If any Collateral is at any time in the possession of a bailee,
the Debtor shall promptly notify the Secured Party thereof and, at the Secured
Party’s request and option, shall promptly obtain an acknowledgment from the
bailee, in form and substance satisfactory to the Secured Party, that the
bailee holds such Collateral for the benefit of the Secured Party, and that
such bailee agrees to comply, without further consent of the Debtor, with
instructions from the Secured Party as to such Collateral.

 

4.5.                             
Electronic Chattel
Paper and Transferable Records. If the Debtor at any time holds or acquires an
interest in any electronic chattel paper or any “transferable record,” as that
term is defined in Section 201 of the federal Electronic Signatures in
Global and National Commerce Act, or in Section 16 of the Uniform
Electronic Transactions Act as in effect in any relevant jurisdiction, the
Debtor shall promptly notify the Secured Party thereof and, at the request and
option of the Secured Party, shall take such action as the Secured Party may
reasonably request to vest in the Secured Party control, under
Section 9-105 of the Uniform Commercial Code, of such electronic chattel
paper or control under Section 201 of the federal Electronic Signatures in
Global and National Commerce Act or, as the case may be, Section 16 of the
Uniform Electronic Transactions Act, as so in effect in such jurisdiction, of
such transferable record.

 

3

 

4.6.                             
Letter-of-Credit
Rights. If the Debtor is at any time a beneficiary under a letter of credit,
the Debtor shall promptly notify the Secured Party thereof and, at the request
and option of the Secured Party, the Debtor shall, pursuant to an agreement in
form and substance satisfactory to the Secured Party, either (i) arrange for
the issuer and any confirmer or other nominated person of such letter of credit
to consent to an assignment to the Secured Party of the proceeds of the letter
of credit, or (ii) arrange for the Secured Party to become the transferee
beneficiary of the letter of credit, with the Secured Party agreeing, in each
case, that the proceeds of the letter to credit are to be applied as provided
in the Loan Agreement.

 

4.7                                
Commercial Tort
Claims. If the Debtor shall at any time hold or acquire a commercial tort
claim, the Debtor shall immediately notify the Secured Party in a writing
signed by the Debtor of the particulars thereof and grant to the Secured Party
in such writing a security interest therein and in the proceeds thereof, all
upon the terms of this Agreement, with such writing to be in form and substance
satisfactory to the Secured Party.

 

4.8.                             
Other Actions as to
Any and All Collateral. The Debtor further agrees, at the request and option of
the Secured Party, to take any and all other actions the Secured Party may
determine to be necessary or useful for the attachment, perfection and first
priority of, and the ability of the Secured Party to enforce, the Secured
Party’s security interest in any and all of the Collateral, including, without
limitation, (a) executing, delivering and, where appropriate, filing financing
statements and amendments relating thereto under the Uniform Commercial Code,
to the extent, if any, that the Debtor’s signature thereon is required
therefor, (b) causing the Secured Party’s name to be noted as secured party on
any certificate of title for a titled good if such notation is a condition to
attachment, perfection or priority of, or ability of the Secured Party to
enforce, the Secured Party’s security interest in such Collateral, (c)
complying with any provision of any statute, regulation or treaty of the United
States as to any Collateral if compliance with such provision is a condition to
attachment, perfection or priority of, or ability of the Secured Party to
enforce, the Secured Party’s security interest in such Collateral, (d)
obtaining governmental and other third party waivers, consents and approvals in
form and substance satisfactory to Secured Party, including, without
limitation, any consent of any licensor, lessor or other person obligated on
Collateral, (e) obtaining waivers from mortgagees and landlords in form and
substance satisfactory to the Secured Party and (f) taking all actions under
any earlier versions of the Uniform Commercial Code or under any other law, as
reasonably determined by the Secured Party to be applicable in any relevant
Uniform Commercial Code or other jurisdiction, including any foreign
jurisdiction.

 

5.                                      
Relation to Other
Security Documents. The provisions of this Agreement supplement the provisions
of any real estate mortgage or deed of trust granted by the Debtor to the Secured
Party which secures the payment or performance of any of the Obligations.
Nothing contained in any such real estate mortgage or deed of trust shall
derogate from any of the rights or remedies of the Secured Party hereunder.

 

6.                                      
Representations and
Warranties Concerning Debtor’s Legal Status. The Debtor has concurrently
executed and delivered the Loan Agreement to the Secured Party. The Debtor
represents and warrants to the Secured Party that all representations, warranties
and other information set forth

 

4

 

in the Loan Agreement pertaining to the Debtor is
accurate and complete.  The Debtor further represents and warrants that:

 

(a)                                 
The Wornick Company
is a Delaware corporation.  The Wornick Company’s Secretary of State
organization number is 3731379 and its taxpayer identification number is
30-0225741.  The sole shareholder of The Wornick Company is TWC Holding,
LLC, a Delaware limited liability company.  The members of the board of
directors and the executive officers of The Wornick Company prior to and after
the closing of the Asset Transaction are and will be as set forth in
Schedule 1 hereto.  The principal office of The Wornick Company
is10825 Kenwood Road, Cincinnati, Ohio 45242.  The mailing address of The
Wornick Company is The Wornick Company, Attention: Larry L. Rose, President and
CEO, 10825 Kenwood Road, Cincinnati, Ohio 45242, with copy to Robert B. McKeon,
Veritas Capital Management II L.L.C., 660 Madison Avenue, New York, New York,
10021.

 

(b)                                
Right Away Management
Corporation is a Delaware corporation.  Right Away Management
Corporation’s Secretary of State organization number is 3742360, and its
taxpayer identification number is 36-4547729.  The sole shareholder of
Right Away Management Corporation is The Wornick Company, a Delaware
corporation.  The members of the board of directors and the executive
officers of Right Away Management Corporation prior to and after the closing of
the Asset Transaction are and will be as set forth in Schedule 1
hereto.  The principal office of Right Away Management Corporation is c/o
Veritas Capital Management II L.L.C., 660 Madison Avenue, New York, New York
10021. The mailing address of Right Away Management Corporation is Right Away
Management Corporation, Attention: Keith E. Frase, President and CEO, 200 North
1st Street, McAllen, Texas 78501, with copy to Robert B. McKeon,
Veritas Capital Management II L.L.C., 660 Madison Avenue, New York, New York
10021.

 

(c)                                 
The Wornick Company
Right Away Division is a Delaware corporation.  The Wornick Company Right
Away Division’s Secretary of State organization number is 3742362, and its
taxpayer identification number is 35-2223696.  The sole shareholder of The
Wornick Company Right Away Division is The Wornick Company, a Delaware
corporation.  The members of the board of directors and the executive
officers of The Wornick Company Right Away Division prior to and after the closing
of the Asset Transaction are and will be as set forth in Schedule 1
hereto.  The principal office of The Wornick Company Right Away Division
is c/o Veritas Capital Management II L.L.C., 660 Madison Avenue, New York, New
York 10021. The mailing address of The Wornick Company Right Away Division is
The Wornick Company, Attention: Larry L. Rose, President and CEO, 10825 Kenwood
Road, Cincinnati, Ohio 45242, with copy to Robert B. McKeon, Veritas Capital
Management II L.L.C., 660 Madison Avenue, New York, New York 10021.

 

(d)                                
The Wornick Company
Right Away Division, L.P. is a Delaware limited partnership.

 

5

 

The Wornick Company Right Away Division, L.P.’s
Secretary of State organization number is 3744423, and its taxpayer
identification number is 32-0105479.  The current partners of The Wornick
Company Right Away Division, L.P. are: General Partner -  Right Away
Management Corporation, a Delaware corporation owning 0.1% of the limited
partnership and Limited Partner -  The Wornick Company Right Away
Division, a Delaware corporation owning 99.9% of the limited partnership. 
The principal office of The Wornick Company Right Away Division, L.P. is
located 200 North 1st Street, McAllen, Texas 78501. The mailing
address of The Wornick Company Right Away Division, L.P.  is c/o Right
Away Management Corporation, Attention: Keith E. Frase, President and CEO, 200
North 1st Street, McAllen, Texas 78501, with copy to Robert B. McKeon, Veritas
Capital Management II L.L.C. 660, Madison Avenue, New York, New York 10021.

 

7.                                      
Covenants Concerning
Debtor’s Legal Status. The Debtor covenants with the Secured Party as follows:
(a) without providing at least 30 days’ prior written notice to the Secured Party,
the Debtor will not change its name, its place of business or, if more than
one, chief executive office, or its mailing address or organizational
identification number if it has one, (b) if the Debtor does not have an
organizational identification number and later obtains one, the Debtor shall
forthwith notify the Secured Party of such organizational identification
number, and (c) the Debtor will not change its type of organization,
jurisdiction of organization or other legal structure.

 

8.                                      
Representations and
Warranties Concerning Collateral, etc. The Debtor further represents and
warrants to the Secured Party as follows: (a) the Debtor is the owner of the
Collateral, free from any right or claim or any person or any adverse lien,
security interest or other encumbrance, except for the security interest
created by this Agreement and other liens permitted by the Loan Agreement, (b)
none of the Collateral constitutes, or is the proceeds of, “farm products” as
defined in Section 9-102(a)(34) of the Uniform Commercial Code of the
State, (c)the Debtor holds no commercial tort claim,  (d) the Debtor has
at all times operated its business in compliance with all applicable provisions
of the federal Fair Labor Standards Act, as amended, and with all applicable
provisions of federal, state and local statutes and ordinances dealing with the
control, shipment, storage or disposal of hazardous materials or substances,
(e) all other information set forth herein or in the Loan Agreement pertaining
to the Collateral is accurate and complete, and (g) that there has been no
change in any information provided herein or in the Loan Agreement since the
date on which it was executed by the Debtor.

 

9.                                      
Covenants Concerning
Collateral, etc. The Debtor further covenants with the Secured Party as
follows: (a) the Collateral, to the extent not delivered to the Secured Party
pursuant to Section 4, will be kept at the Property and the Debtor will
not remove the Collateral from such locations, without providing at least
thirty days’ prior written notice to the Secured Party, (b) except for the
security interest herein granted and liens permitted by the Loan Agreement, the
Debtor shall be the owner of the Collateral free from any right or claim of any
other person, lien, security interest or other encumbrance, and the Debtor
shall defend the same against all claims and demands of all persons at any time
claiming the same or any interests therein adverse to the Secured Party, (c)
the Debtor shall not pledge, mortgage or create, or suffer to exist any right
of any person in or claim by

 

6

 

any person to the Collateral, or any security
interest, lien or encumbrance in the Collateral in favor of any person, other
than the Secured Party except for liens permitted by the Loan Agreement, (d)
the Debtor will keep the Collateral in good order and repair and will not use
the same in violation of law or any policy of insurance thereon, (e) the Debtor
will permit the Secured Party, or its designee, to inspect the Collateral at
any reasonable time, wherever located, (f) the Debtor will pay promptly when
due all taxes, assessments, governmental charges and levies upon the Collateral
or incurred in connection with the use or operation of such Collateral or
incurred in connection with this Agreement, (g) the Debtor will continue to
operate, its business in compliance with all applicable provisions of the
federal Fair Labor Standards Act, as amended, and with all applicable provisions
of federal, state and local statutes and ordinances dealing with the control,
shipment, storage or disposal of hazardous materials or substances, and (h) the
Debtor will not sell or otherwise dispose, or offer to sell or otherwise
dispose, of the Collateral or any interest therein except for dispositions
permitted by the Loan Agreement, and sales of Inventory in the ordinary course
of Debtor’s business.

 

10.                                
Insurance.

 

10.1.                       
Maintenance of Insurance.
The Debtor will maintain with financially sound and reputable insurers
insurance with respect to its properties and business against such casualties
and contingencies as shall be in accordance with general practices of
businesses engaged in similar activities in similar geographic areas. Such
insurance shall be in such minimum amounts that the Debtor will not be deemed a
co-insurer under applicable insurance laws, regulations and policies and
otherwise shall be in such amounts, contain such terms, be in such forms and be
for such periods as may be reasonably satisfactory to the Secured Party. In
addition, all such insurance shall be payable to the Secured Party as
additional insured, mortgagee or loss payee (as directed by Secured, and in the
absence of such direction, as additional insured). Without limiting the
foregoing, the Debtor will (i) keep all of its physical property insured with
casualty or physical hazard insurance on an “all risks” basis, with broad form
flood and earthquake coverages and electronic data processing coverage, with a
full replacement cost endorsement and an “agreed amount” clause in an amount
equal to 100% of the full replacement cost of such property, (ii) maintain all
such workers’ compensation or similar insurance as may be required by law, and
(iii) maintain, in amounts and with deductibles equal to those generally
maintained by businesses engaged in similar activities in similar geographic
areas, general public liability insurance against claims of bodily injury,
death or property damage occurring, on, in or about the properties of the
Debtor; business interruption insurance; and product liability insurance.

 

10.2.                       
Insurance Proceeds.
The proceeds of any casualty insurance in respect of any casualty loss of any
of the Collateral shall, subject to the rights, if any, of other parties with
an interest having priority in the property covered thereby, be held by the
Secured Party as cash collateral for the Obligations. The Secured Party may, at
its sole option, disburse from time to time all or any part of such proceeds so
held as cash collateral, upon such terms and conditions as the Secured Party
may reasonably prescribe, for direct application by the Debtor solely to the
repair or replacement of the Debtor’s property so damaged or destroyed, or the
Secured Party may apply all or any part of such proceeds to the Obligations.

 

7

 

10.3.                       
Continuation of
Insurance. All policies of insurance shall provide for at least 30 days’ prior
written cancellation notice to the Secured Party.  In the event of failure
by the Debtor to provide and maintain insurance as herein provided, the Secured
Party may, at its option, provide such insurance and charge the amount thereof
to the Debtor. The Debtor shall furnish the Secured Party with certificates of
insurance and policies evidencing compliance with the foregoing insurance
provision.

 

11.                                
Collateral Protection
Expenses; Preservation of Collateral.

 

11.1.                       
Expenses Incurred by
Secured Party. In the Secured Party’s discretion, if the Debtor fails to do so,
the Secured Party may discharge taxes and other encumbrances at any time levied
or placed on any of the Collateral, maintain any of the Collateral, make
repairs thereto and pay any necessary filing fees or insurance premiums. The
Debtor agrees to reimburse the Secured Party on demand for all expenditures so
made. The Secured Party shall have no obligation to the Debtor to make any such
expenditures, nor shall the making thereof be construed as the waiver or cure
of any Default or Event of Default.

 

11.2.                       
Secured Party’s
Obligations and Duties. Anything herein to the contrary notwithstanding, the
Debtor shall remain obligated and liable under each contract or agreement
comprised in the Collateral to be observed or performed by the Debtor
thereunder. The Secured Party shall not have any obligation or liability under
any such contract or agreement by reason of or arising out of this Agreement or
the receipt by the Secured Party of any payment relating to any of the
Collateral, nor shall the Secured Party be obligated in any manner to perform
any of the obligations of the Debtor under or pursuant to any such contract or
agreement, to make inquiry as to the nature or sufficiency of any payment
received by the Secured Party in respect of the Collateral or as to the
sufficiency of any performance by any party under any such contract or
agreement, to present or file any claim, to take any action to enforce any
performance or to collect the payment of any amounts which may have been
assigned to the Secured Party or to which the Secured Party may be entitled at
any time or times. The Secured Party’s sole duty with respect to the custody,
safe keeping and physical preservation of the Collateral in its possession,
under Section 9-207 of the Uniform Commercial Code of the State or
otherwise, shall be to deal with such Collateral in the same manner as the
Secured Party deals with similar property for its own account.

 

12.                                
Securities and
Deposits.  The Secured Party may at any time, at its option, transfer to
itself or any nominee any securities constituting Collateral, receive any
income thereon and hold such income as additional Collateral or apply it to the
Obligations. Whether or not any Obligations are due, the Secured Party may
demand, sue for, collect, or make any settlement or compromise which it deems
desirable with respect to the Collateral. Regardless of the adequacy of
Collateral or any other security for the Obligations, any deposits or other
sums at any time credited by or due from the Secured Party to the Debtor may at
any time be applied to or set off against any of the Obligations.

 

13.                                
Notification to
Account Debtors and Other Persons Obligated on Collateral. The Debtor shall, at
the request and option of the Secured Party, notify account debtors and other
persons

 

8

 

obligated on any of the Collateral of the security
interest of the Secured Party in any account, chattel paper, general
intangible, instrument or other Collateral and that payment thereof is to be
made directly to the Secured Party or to any financial institution designated
by the Secured Party as the Secured Party’s agent therefor, and the Secured
Party may itself, without notice to or demand upon the Debtor, so notify
account debtors and other persons obligated on Collateral. After the making of
such a request or the giving of any such notification, the Debtor shall hold
any proceeds of collection of accounts, chattel paper, general intangibles,
instruments and other Collateral received by the Debtor as trustee for the
Secured Party without commingling the same with other funds of the Debtor and
shall turn the same over to the Secured Party in the identical form received,
together with any necessary endorsements or assignments. The Secured Party
shall apply the proceeds of collection of accounts, chattel paper, general
intangibles, instruments and other Collateral received by the Secured Party to
the Obligations, such proceeds to be immediately credited after final payment
in cash or other immediately available funds of the items giving rise to them.

 

14.                                
Power of Attorney.

 

14.1.                       
Appointment and
Powers of Secured Party. The Debtor hereby irrevocably constitutes and appoints
the Secured Party and any officer or agent thereof, with full power of
substitution, as its true and lawful attorneys-in-fact with full irrevocable
power and authority in the place and stead of the Debtor or in the Secured
Party’s own name, for the purpose of carrying out the terms of this Agreement,
to take any and all appropriate action and to execute any and all documents and
instruments that may be necessary or useful to accomplish the purposes of this
Agreement and, without limiting the generality of the foregoing, hereby gives
said attorneys the power and right, on behalf of the Debtor, without notice to
or assent by the Debtor, to do the following:

 

(a)                                 
upon the occurrence
and during the continuance of an Event of Default, generally to sell, transfer,
pledge, make any agreement with respect to or otherwise dispose of or deal with
any of the Collateral in such manner as is consistent with the Uniform
Commercial Code of the State, or other applicable jurisdiction, and as fully
and completely as though the Secured Party were the absolute owner thereof for
all purposes, and to do, at the Debtor’s expense, at any time, or from time to
time, all acts and things which the Secured Party deems necessary or useful to
protect, preserve or realize upon the Collateral and the Secured Party’s
security interest therein, in order to effect the intent of this Agreement, all
at least as fully and effectively as the Debtor might do, including, without
limitation, (i) the filing and prosecuting of registration and transfer
applications with the appropriate federal, state, local or other agencies or authorities
with respect to trademarks, copyrights and patentable inventions and processes,
(ii) upon written notice to the Debtor, the exercise of voting rights with
respect to voting securities (including the voting rights with respect to the
Ownership Interests), which rights may be exercised, if the Secured Party so
elects, with a view to causing the liquidation of assets of the issuer of any
such securities, and (iii) the execution, delivery and recording, in connection
with any sale or other disposition of any Collateral, of the endorsements,
assignments or other instruments of conveyance or transfer with respect to such
Collateral; and

 

9

 

(b)                                
to the extent that
the Debtor’s authorization given in Section 3 is not sufficient, to file
such financing statements with respect hereto, with or without the Debtor’s
signature, or a photocopy of this Agreement in substitution for a financing
statement, as the Secured Party may deem appropriate and to execute in the
Debtor’s name such financing statements and amendments thereto and continuation
statements which may require the Debtor’s signature.

 

14.2.                       
Ratification by
Debtor. To the extent permitted by law, the Debtor hereby ratifies all that
said attorneys shall lawfully do or cause to be done by virtue hereof. This
power of attorney is a power coupled with an interest and is irrevocable.

 

14.3.                       
No Duty on Secured
Party. The powers conferred on the Secured Party hereunder are solely to
protect its interests in the Collateral and shall not impose any duty upon it
to exercise any such powers. The Secured Party shall be accountable only for
the amounts that it actually receives as a result of the exercise of such
powers, and neither it nor any of its officers, directors, employees or agents
shall be responsible to the Debtor for any act or failure to act, except for
the Secured Party’s own gross negligence or willful misconduct.

 

15.                                
Rights and Remedies. If
an Event of Default shall have occurred and be continuing, the Secured Party,
without any other notice to or demand upon the Debtor have in any jurisdiction
in which enforcement hereof is sought, in addition to all other rights and
remedies, the rights and remedies of a secured party under the Uniform
Commercial Code of the State and any additional rights and remedies which may
be provided to a secured party in any jurisdiction in which Collateral is
located, including, without limitation, the right to take possession of the
Collateral, and for that purpose the Secured Party may, so far as the Debtor
can give authority therefor, enter upon any premises on which the Collateral
may be situated and remove the same therefrom. The Secured Party may in its discretion
require the Debtor to assemble all or any part of the Collateral at such
location or locations within the jurisdiction(s) of the Debtor’s principal
office(s) or at such other locations as the Secured Party may reasonably
designate. Unless the Collateral is perishable or threatens to decline speedily
in value or is of a type customarily sold on a recognized market, the Secured
Party shall give to the Debtor at least five Business Days’ prior written
notice of the time and place of any public sale of Collateral or of the time
after which any private sale or any other intended disposition is to be made.
The Debtor hereby acknowledges that five Business Days’ prior written notice of
such sale or sales shall be reasonable notice. In addition, the Debtor waives
any and all rights that it may have to a judicial hearing in advance of the
enforcement of any of the Secured Party’s rights and remedies hereunder,
including, without limitation, its right following an Event of Default to take
immediate possession of the Collateral and to exercise its rights and remedies
with respect thereto.

 

16.                                
Standards for
Exercising Rights and Remedies. To the extent that applicable law imposes
duties on the Secured Party to exercise remedies in a commercially reasonable
manner, the Debtor acknowledges and agrees that it is not commercially
unreasonable for the Secured Party (a) to fail to incur expenses reasonably
deemed significant by the Secured Party to prepare Collateral for disposition
or otherwise to fail to complete raw material or work in process into finished
goods or other finished products for disposition, (b) to fail to obtain third
party consents for access to 

 

10

 

Collateral to be disposed of, or to obtain or, if not
required by other law, to fail to obtain governmental or third party consents
for the collection or disposition of Collateral to be collected or disposed of,
(c) to fail to exercise collection remedies against account debtors or other
persons obligated on Collateral or to fail to remove liens or encumbrances on
or any adverse claims against Collateral, (d) to exercise collection remedies
against account debtors and other persons obligated on Collateral directly or
through the use of collection agencies and other collection specialists, (e) to
advertise dispositions of Collateral through publications or media of general
circulation, whether or not the Collateral is of a specialized nature, (f) to
contact other persons, whether or not in the same business as the Debtor, for
expressions of interest in acquiring all or any portion of the Collateral, (g)
to hire one or more professional auctioneers to assist in the disposition of
Collateral, whether or not the collateral is of a specialized nature, (h) to
dispose of Collateral by utilizing Internet sites that provide for the auction
of assets of the types included in the Collateral or that have the reasonable
capability of doing so, or that match buyers and sellers of assets, (i) to
dispose of assets in wholesale rather than retail markets, (j) to disclaim
disposition warranties, (k) to purchase insurance or credit enhancements to
insure the Secured Party against risks of loss, collection or disposition of
Collateral or to provide to the Secured Party a guaranteed return from the
collection or disposition of Collateral, or (l) to the extent deemed
appropriate by the Secured Party, to obtain the services of other brokers,
investment bankers, consultants and other professionals to assist the Secured
Party in the collection or disposition of any of the Collateral.  The
Debtor acknowledges that the purpose of this Section 16 is to provide
non-exhaustive indications of what actions or omissions by the Secured Party
would fulfill the Secured Party’s duties under the Uniform Commercial Code or
other law of the State or any other relevant jurisdiction in the Secured
Party’s exercise of remedies against the Collateral and that other actions or
omissions by the Secured Party shall not be deemed to fail to fulfill such
duties solely on account of not being indicated in this Section 16.
Without limitation upon the foregoing, nothing contained in this
Section 16 shall be construed to grant any rights to the Debtor or to
impose any duties on the Secured Party that would not have been granted or
imposed by this Agreement or by applicable law in the absence of this
Section 16.

 

17.                                
No Waiver by Secured
Party, etc. The Secured Party shall not be deemed to have waived any of its
rights or remedies in respect of the Obligations or the Collateral unless such
waiver shall be in writing and signed by the Secured Party. No delay or
omission on the part of the Secured Party in exercising any right or remedy
shall operate as a waiver of such right or remedy or any other right or remedy.
A waiver on any one occasion shall not be construed as a bar to or waiver of
any right or remedy on any future occasion. All rights and remedies of the
Secured Party with respect to the Obligations or the Collateral, whether
evidenced hereby or by any other instrument or papers, shall be cumulative and
may be exercised singularly, alternatively, successively or concurrently at
such time or at such times as the Secured Party deems expedient.

 

18.                                
Suretyship Waivers by
Debtor. The Debtor waives demand, notice, protest, notice of acceptance of this
Agreement, notice of loans made, credit extended, Collateral received or
delivered or other action taken in reliance hereon and all other demands and
notices of any description. With respect to both the Obligations and the
Collateral, the Debtor assents to any extension or postponement of the time of
payment or any other indulgence, to any substitution, exchange or release of or
failure to perfect any security interest in any Collateral, to the addition or
release of any 

 

11

 

party or person primarily or secondarily liable, to
the acceptance of partial payment thereon and the settlement, compromising or
adjusting of any thereof, all in such manner and at such time or times as the
Secured Party may deem advisable. The Secured Party shall have no duty as to
the collection or protection of the Collateral or any income therefrom, the
preservation of rights against prior parties, or the preservation of any rights
pertaining thereto beyond the safe custody thereof as set forth in
Section 11.2. The Debtor further waives any and all other suretyship
defenses.

 

19.                                
Marshaling. The
Secured Party shall not be required to marshal any present or future collateral
security (including but not limited to the Collateral) for, or other assurances
of payment of, the Obligations or any of them or to resort to such collateral
security or other assurances of payment in any particular order, and all of its
rights and remedies hereunder and in respect of such collateral security and
other assurances of payment shall be cumulative and in addition to all other
rights and remedies, however existing or arising. To the extent that it
lawfully may, the Debtor hereby agrees that it will not invoke any law relating
to the marshaling of collateral which might cause delay in or impede the
enforcement of the Secured Party’s rights and remedies under this Agreement or
under any other instrument creating or evidencing any of the Obligations or
under which any of the Obligations is outstanding or by which any of the
Obligations is secured or payment thereof is otherwise assured, and, to the
extent that it lawfully may, the Debtor hereby irrevocably waives the benefits
of all such laws.

 

20.                                
Indemnity and
Expenses.

 

Debtor agrees:

 

(a)                                 
To indemnify and hold
harmless the Released Parties (hereinafter defined) from and against any and
all claims, damages, demands, losses, obligations, judgments and liabilities
(including, without limitation, reasonable attorneys’ fees and expenses) in any
way arising out of or in connection with this Agreement or the Obligations,
except to the extent the same shall arise as a result of the gross negligence
or willful misconduct of the party seeking to be indemnified; and

 

(b)                                
To pay and reimburse
Secured Party upon demand for all reasonable costs and expenses (including,
without limitation, reasonable attorneys’ fees and expenses) that Secured Party
may incur in connection with (i) the custody, use or preservation of, or the
sale of, collection from or other realization upon, any of the Collateral,
including the reasonable expenses of re-taking, holding, preparing for sale or
lease, selling or otherwise disposing of or realizing on the Collateral, (ii)
the exercise or enforcement of any rights or remedies granted hereunder, under
the Loan Agreement, or under any of the other Loan Documents or otherwise available
to it (whether at law, in equity or otherwise), or (iii) the failure by Debtor
to perform or observe any of the provisions hereof. The provisions of this
Section shall survive the execution and delivery of this Agreement, the
repayment of any of the Obligations, the termination of the commitments of
Secured Party under the Loan Agreement and the termination of this Agreement or
any other Loan Document.

 

21.                                
Duties of Secured
Party.    The powers conferred on Secured Party hereunder are
solely to protect its interests in the Collateral and shall not impose on it
any duty to exercise such powers. Except as provided in Section 9-207 of
the Code, Secured Party shall have no duty with 

 

12

 

respect to the Collateral or any responsibility for
taking any necessary steps to preserve rights against any Persons with respect
to any Collateral.  It is also expressly understood and agreed that except
for the obligation of “honesty in fact” as provided in Section 1.203 of
the Texas Business and Commerce Code (to the extent applicable), the Secured
Party, in exercising its rights and performing its obligations under any of the
Loan Documents, owes no duty of good faith and/or fair dealing to Debtor,
Obligor, any guarantor of the Obligations, or any shareholder of Obligor, and
no fiduciary duty exists between or among Debtor, Obligor, any guarantor of the
Obligations, any shareholder of Obligor, and the Secured Party.

 

22.                                
Disposition of
Proceeds.  After deducting all expenses, the residue of any proceeds of
collection or sale or other disposition of the Collateral shall, to the extent
actually received in cash, be applied to the payment of the Obligations in such
order or preference as the Secured Party may determine, proper allowance and
provision being made for any Obligations not then due. Upon the final payment
and satisfaction in full of all of the Obligations and after making any
payments required by Sections 9-608(a)(1)(C) or 9-615(a)(3) of the Uniform
Commercial Code of the State, any excess shall be returned to the Debtor. In
the absence of final payment and satisfaction in full of all of the
Obligations, the Debtor shall remain liable for any deficiency.

 

23.                                
Overdue Amounts.
Until paid, all amounts due and payable by the Debtor hereunder shall be a debt
secured by the Collateral and shall bear, whether before or after judgment,
interest at the rate of interest for overdue principal set forth in the Loan
Agreement.

 

24.                                
Governing Law;
Consent to Jurisdiction. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS. The Debtor and Secured Party
agree that any action or claim arising out of, or any dispute in connection
with, this Agreement, any rights, remedies, obligations, or duties hereunder,
or the performance or enforcement hereof or thereof, shall be decided by
binding arbitration as set forth in the Loan Agreement.

 

25.                                
Miscellaneous. The
headings of each section of this Agreement are for convenience only and
shall not define or limit the provisions thereof. This Agreement and all rights
and obligations hereunder shall be binding upon the Debtor and its respective
successors and assigns, and shall inure to the benefit of the Secured Party and
its successors and assigns.  If any term of this Agreement shall be held
to be invalid, illegal or unenforceable, the validity of all other terms hereof
shall in no way be affected thereby, and this Agreement shall be construed and
be enforceable as if such invalid, illegal or unenforceable term had not been
included herein. The Debtor acknowledges receipt of a copy of this Agreement.

 

IN WITNESS WHEREOF, intending
to be legally bound, the Debtor and Secured Party have caused this Agreement to
be duly executed as of the date first above written.

 

[SIGNATURE PAGES
FOLLOW]

 

13

 

	
   

  	
  DEBTOR:

  
	
   

  	
   

  
	
   

  	
  THE WORNICK COMPANY, a
  Delaware

  corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert B. McKeon

  	
   

  
	
   

  	
   

  	
  Robert B. McKeon

  
	
   

  	
   

  	
  Chairman of the Board

  
	
   

  	
   

  	
  Address:  c/o
  Veritas Capital

  
	
   

  	
   

  	
  Management II L.L.C.

  
	
   

  	
   

  	
  660 Madison Avenue

  
	
   

  	
   

  	
  New York, New York
  10021

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THE WORNICK COMPANY
  RIGHT AWAY

  DIVISION, L.P., a Delaware limited

  partnership

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Right Away Management
  Corporation,

  a Delaware corporation, its general

  partner

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Robert B. McKeon

  	
   

  
	
   

  	
   

  	
   

  	
  Name:  Robert B.
  McKeon

  
	
   

  	
   

  	
   

  	
  Title: 
    Chairman of the Board

  
	
   

  	
   

  
	
   

  	
  Address:  c/o
  Veritas Capital

  
	
   

  	
  Management II L.L.C.

  
	
   

  	
  660 Madison Avenue

  
	
   

  	
  New York, New York
  10021

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  RIGHT AWAY MANAGEMENT

  CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert B. McKeon

  	
   

  
	
   

  	
   

  	
  Name:  Robert B.
  McKeon

  
	
   

  	
   

  	
  Title:   
  Chairman of the Board

  
	
   

  	
   

  	
   

  
	
   

  	
  Address:  c/o
  Veritas Capital

  
	
   

  	
  Management II L.L.C.

  
	
   

  	
  660 Madison Avenue

  
	
   

  	
  New York, New York
  10021

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

14

 

	
   

  	
  THE WORNICK COMPANY
  RIGHT AWAY

  DIVISION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert B. McKeon

  	
   

  
	
   

  	
   

  	
  Name:  Robert B.
  McKeon

  
	
   

  	
   

  	
  Title:   
  Chairman of the Board

  
	
   

  	
   

  
	
   

  	
  Address:  c/o Veritas Capital

  
	
   

  	
  Management II L.L.C.

  
	
   

  	
  660 Madison Avenue

  
	
   

  	
  New York, New York
  10021

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SECURED
  PARTY:

  
	
   

  	
   

  
	
   

  	
  TEXAS STATE BANK

  
	
   

  	
   

  
	
   

  	
  /s/ Douglas G. Bready

  	
   

  
	
   

  	
  By:  Douglas G.
  Bready

  
	
   

  	
  Its:
    President

  

 

15Exhibit
10.8

 

PLEDGE
AGREEMENT

 

THIS PLEDGE AGREEMENT
(this “Agreement”), dated as of June 30, 2004, is made and entered into by
and between TWC Holding LLC, a Delaware limited liability company (“Pledgor”),
and TEXAS STATE BANK, a Texas banking corporation (“Secured Party”), with
reference to the following:

 

WHEREAS, THE WORNICK
COMPANY, a Delaware corporation (“Obligor”), RIGHT AWAY MANAGEMENT CORPORATION,
a Delaware corporation, THE WORNICK COMPANY RIGHT AWAY DIVISION, a Delaware
corporation, THE WORNICK COMPANY RIGHT AWAY DIVISION, L.P., a Delaware limited
partnership, Pledgor, and Secured Party have entered into a Loan Agreement of
even date herewith (as amended and in effect from time to time, the “Loan
Agreement”); and

 

WHEREAS, Pledgor
beneficially owns the Equity Interests (as hereinafter defined) in the Issuers
(as hereinafter defined); and

 

WHEREAS, to induce
Secured Party to make the financial accommodations provided to the Obligor
pursuant to the Loan Agreement, Pledgor desires to pledge, grant, transfer, and
assign to Secured Party a security interest in the Collateral to secure all
Obligations.

 

NOW, THEREFORE, in
consideration of the mutual promises, covenants, representations, and
warranties set forth herein and for other good and valuable consideration, the
parties hereto agree as follows:

 

1.                                     
Definitions and Construction.

 

(a)                                 
Definitions.

 

All capitalized terms
used herein, not otherwise defined herein, shall have the meaning ascribed
thereto in the Loan Agreement. As used in this Agreement:

 

“Bankruptcy Code” means
United States Bankruptcy Code (11 U.S.C. Section 101 et seq.), as in
effect from time to time, and any successor statute thereto.

 

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

 

“Collateral” shall mean
the Pledged Interests, the Future Rights, and the Proceeds, collectively.

 

“Equity Interests” means
all securities, shares, units, options, warrants, interests, participations, or
other equivalents (regardless of how designated) of or in a corporation,
partnership,

 

 

limited liability company, or similar entity, whether
voting or nonvoting, certificated or uncertificated, including general partner
partnership interests, limited partner partnership interests, common stock,
preferred stock, or any other “equity security” (as such term is defined in
Rule 3a11-1 of the General Rules and Regulations promulgated by the Securities
and Exchange Commission under the Securities Exchange Act of 1934).

 

“Future Rights” shall
mean: (a) all Equity Interests (other than Pledged Interests) of the Issuers,
and all securities convertible or exchangeable into, and all warrants, options,
or other rights to purchase, Equity Interests of the Issuers; and (b) the
certificates or instruments representing such Equity Interests, convertible or
exchangeable securities, warrants, and other rights and all dividends, cash,
options, warrants, rights, instruments, and other property or proceeds from
time to time received, receivable, or otherwise distributed in respect of or in
exchange for any or all of such Equity Interests.

 

“Holder” and “Holders”
shall have the meanings ascribed thereto in Section 3 of this Agreement.

 

“Issuers” shall mean each
of the Persons identified as an Issuer on Schedule 1
attached hereto (or any addendum thereto), and any successors thereto, whether
by merger or otherwise.

 

“Lien” shall mean any
lien, mortgage, pledge, assignment (including any assignment of rights to
receive payments of money), security interest, charge, or encumbrance of any
kind (including any conditional sale or other title retention agreement, any
lease in the nature thereof, or any agreement to give any security interest).

 

“Pledged Interests” shall
mean (a) all Equity Interests of the Issuers identified on Schedule 1; and (b) the certificates
or instruments representing such Equity Interests.

 

“Pledgor” shall have the
meaning ascribed thereto in the preamble to this Agreement.

 

“Proceeds” shall mean all
proceeds (including proceeds of proceeds) of the Pledged Interests and Future
Rights including all: (a) rights, benefits, distributions, premiums, profits,
dividends, interest, cash, instruments, documents of title, accounts, contract
rights, inventory, equipment, general intangibles, payment intangibles, deposit
accounts, chattel paper, and other property from time to time received,
receivable, or otherwise distributed in respect of or in exchange for, or as a
replacement of or a substitution for, any of the Pledged Interests, Future
Rights, or proceeds thereof (including any cash, Equity Interests, or other
securities or instruments issued after any recapitalization, readjustment,
reclassification, merger or consolidation with respect to the Issuers and any
security entitlements, as defined in Section 8-102(a)(17) of the Code,
with respect thereto); (b) “proceeds,” as such term is defined in
Section 9-102(a)(64) of the Code; (c) proceeds of any insurance,
indemnity, warranty, or guaranty (including guaranties of delivery) payable
from time to time with respect to any of the Pledged Interests, Future Rights,
or proceeds thereof; (d) payments (in any form whatsoever) made or due and
payable to Pledgor from time to time in connection with

 

2

 

any requisition, confiscation, condemnation, seizure
or forfeiture of all or any part of the Pledged Interests, Future Rights, or
proceeds thereof; and (e) other amounts from time to time paid or payable under
or in connection with any of the Pledged Interests, Future Rights, or proceeds
thereof.

 

“Secured Party” shall
have the meaning ascribed thereto in the preamble to this Agreement, together
with its successors or assigns.

 

“Securities Act” shall
have the meaning ascribed thereto in Section 9(c) of this Agreement.

 

(b)                                
Construction.

 

(i)                                    
Unless the context of
this Agreement clearly requires otherwise, references to the plural include the
singular and to the singular include the plural, the part includes the whole,
the term “including” is not limiting, and the term “or” has, except where
otherwise indicated, the inclusive meaning represented by the phrase “and/or.”
The words “hereof,” “herein,” “hereby,” “hereunder,” and other similar terms in
this Agreement refer to this Agreement as a whole and not exclusively to any
particular provision of this Agreement. Article, section, subsection, exhibit,
and schedule references are to this Agreement unless otherwise specified.
All of the exhibits or schedules attached to this Agreement shall be deemed
incorporated herein by reference. Any reference to any of the following
documents includes any and all alterations, amendments, restatements,
extensions, modifications, renewals, or supplements thereto or thereof, as
applicable: this Agreement, the Loan Agreement, or any of the other Loan
Documents.

 

(ii)                                 
Neither this
Agreement nor any uncertainty or ambiguity herein shall be construed or
resolved against Secured Party or Pledgor, whether under any rule of
construction or otherwise. On the contrary, this Agreement has been reviewed by
both of the parties and their respective counsel and shall be construed and
interpreted according to the ordinary meaning of the words used so as to fairly
accomplish the purposes and intentions of the parties hereto.

 

(iii)                              
In the event of any
direct conflict between the express terms and provisions of this Agreement and
of the Loan Agreement, the terms and provisions of the Loan Agreement shall
control.

 

2.                                     
Pledge.

 

As security for the
prompt payment and performance of the Obligations when due, whether at stated
maturity, by acceleration or otherwise (including amounts that would become due
but for the operation of the provisions of the Bankruptcy Code), Pledgor hereby
pledges, grants, transfers, and assigns to Secured Party a security interest in
all of Pledgor’s right, title, and interest in and to the Collateral.

 

3

 

3.                                     
Delivery and Registration of Collateral.

 

(a)                                 
All certificates or
instruments representing or evidencing the Collateral shall be promptly
delivered by Pledgor to Secured Party or Secured Party’s designee pursuant
hereto at a location designated by Secured Party and shall be held by or on
behalf of Secured Party pursuant hereto, and shall be in suitable form for
transfer by delivery, or shall be accompanied by duly executed indorsement
certificate in the form attached hereto as Exhibit
A or other instrument of transfer or assignment in blank, in form
and substance satisfactory to Secured Party.

 

(b)                                
Upon the occurrence
and during the continuance of an Event of Default, Secured Party shall have the
right, at any time in its discretion and without notice to Pledgor, to transfer
to or to register on the books of the Issuers (or of any other Person
maintaining records with respect to the Collateral) in the name of Secured
Party or any of its nominees any or all of the Collateral. In addition, Secured
Party shall have the right at any time to exchange certificates or instruments
representing or evidencing Collateral for certificates or instruments of
smaller or larger denominations.

 

(c)                                 
If, at any time and
from time to time, any Collateral (including any certificate or instrument
representing or evidencing any Collateral) is in the possession of a Person
other than Secured Party or Pledgor (a “Holder”), then Pledgor shall
immediately, at Secured Party’s option, either cause such Collateral to be
delivered into Secured Party’s possession, or cause such Holder to enter into a
control agreement, in form and substance satisfactory to Secured Party, and
take all other steps deemed necessary by Secured Party to perfect the security
interest of Secured Party in such Collateral, all pursuant to Sections 9-106
& 9-313 of the Code or other applicable law governing the perfection of
Secured Party’s security interest in the Collateral in the possession of such
Holder.

 

(d)                                
Any and all
Collateral (including dividends, interest, and other cash distributions) at any
time received or held by Pledgor shall be so received or held in trust for
Secured Party, shall be segregated from other funds and property of Pledgor and
shall be forthwith delivered to Secured Party in the same form as so received
or held, with any necessary indorsements; provided that cash dividends or
distributions received by Pledgor, may be retained by Pledgor in accordance
with Section 4 and used in the ordinary course of Pledgor’s business.

 

(e)                                 
If at any time, and
from time to time, any Collateral consists of an uncertificated security or a
security in book entry form, then Pledgor shall immediately cause such
Collateral to be registered or entered, as the case may be, in the name of
Secured Party, or otherwise cause Secured Party’s security interest thereon to
be perfected in accordance with applicable law.

 

4

 

4.                                     
Voting Rights and Dividends.

 

(a)                                 
So long as no Event
of Default shall have occurred and be continuing, Pledgor shall be entitled to
exercise any and all voting and other consensual rights pertaining to the
Collateral or any part thereof for any purpose not inconsistent with the terms
of the Loan Documents and shall be entitled to receive and retain any cash dividends
or distributions paid or distributed in respect of the Collateral.

 

(b)                                
Upon the occurrence
and during the continuance of an Event of Default, all rights of Pledgor to
exercise the voting and other consensual rights or receive and retain cash
dividends or distributions that it would otherwise be entitled to exercise or
receive and retain, as applicable pursuant to Section 4(a), shall cease,
and all such rights shall thereupon become vested in Secured Party, who shall
thereupon have the sole right to exercise such voting or other consensual
rights and to receive and retain such cash dividends and distributions. Pledgor
shall execute and deliver (or cause to be executed and delivered) to Secured
Party all such proxies and other instruments as Secured Party may reasonably
request for the purpose of enabling Secured Party to exercise the voting and
other rights which it is entitled to exercise and to receive the dividends and
distributions that it is entitled to receive and retain pursuant to the
preceding sentence.

 

5.                                     
Representations and Warranties.

 

Each Pledgor represents,
warrants, and covenants, as to the Collateral owned by such Pledgor, as
follows:

 

(a)                                 
Pledgor has taken all
steps it deems necessary or appropriate to be informed on a continuing basis of
changes or potential changes affecting the Collateral (including rights of
conversion and exchange, rights to subscribe, payment of dividends, reorganizations
or recapitalization, tender offers and voting and registration rights), and
Pledgor agrees that Secured Party shall have no responsibility or liability for
informing Pledgor of any such changes or potential changes or for taking any
action or omitting to take any action with respect thereto.

 

(b)                                
Pledgor is an
individual or an entity as designated and described on Schedule 2. The Pledgor’s mailing
address, principal place of business address, state of organization,
organization number and taxpayer identification number are set forth on Schedule 2.

 

(c)                                 
All information
herein or hereafter supplied to Secured Party by or on behalf of Pledgor in
writing with respect to the Collateral is, or in the case of information
hereafter supplied will be, accurate and complete in all material respects.

 

(d)                                
Pledgor is and will
be the sole legal and beneficial owner of the Collateral (including the Pledged
Interests and all other Collateral acquired by Pledgor after the date hereof)
free and clear of any adverse claim, Lien, or other right, title, or interest
of any party, other than the Liens in favor of Secured Party and the Liens
granted to the Trustee as collateral agent under the Indenture and the related
security documents.

 

5

 

(e)                                 
This Agreement, and
the delivery to Secured Party of the Pledged Interests representing Collateral
(or the control agreements referred to in Section 3 of this Agreement),
creates a valid, perfected, and first priority security interest in one hundred
percent (100%) of the Pledged Interests in favor of Secured Party securing
payment of the Obligations, and all actions necessary to achieve such
perfection have been duly taken.

 

(f)                                   
Schedule 1 to this Agreement is true and correct
and complete in all material respects. Without limiting the generality of the
foregoing: (i) except as set forth on Schedule 1,
all the Pledged Interests are in certificated form, and, except to the extent
registered in the name of Secured Party or its nominee pursuant to the
provisions of this Agreement, are registered in the name of Pledgor; and (ii)
the Pledged Interests as to each of the Issuers constitute at least the
percentage of all the fully diluted issued and outstanding Equity Interests of
such Issuer as set forth in Schedule 1
to this Agreement.

 

(g)                                
There are no
presently existing Future Rights or Proceeds owned by Pledgor.

 

(h)                                
The Pledged Interests
have been duly authorized and validly issued and are fully paid and
nonassessable.

 

(i)                                    
Neither the pledge of
the Collateral pursuant to this Agreement nor the extensions of credit
represented by the Obligations violates Regulation T, U or X of the Board of
Governors of the Federal Reserve System.

 

6.                                     
Further Assurances.

 

(a)                                 
Pledgor agrees that
from time to time, at the expense of Pledgor, 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 Secured Party may request, in
order to perfect and protect any security interest granted or purported to be
granted hereby or to enable Secured Party to exercise and enforce its rights
and remedies hereunder with respect to any Collateral. Without limiting the generality
of the foregoing, Pledgor will: (i) at the request of Secured Party, mark
conspicuously each of its records pertaining to the Collateral with a legend,
in form and substance reasonably satisfactory to Secured Party, indicating that
such Collateral is subject to the security interest granted hereby; (ii)
execute and such instruments or notices, as may be necessary or reasonably
desirable, or as Secured Party may request, in order to perfect and preserve
the first priority security interests granted or purported to be granted
hereby; (iii) allow inspection of the Collateral by Secured Party or Persons
designated by Secured Party; and (iv) appear in and defend any action or
proceeding that may affect Pledgor’s title to or Secured Party’s security interest
in the Collateral.

 

(b)                                
Pledgor hereby
authorizes Secured Party to file one or more financing or continuation
statements, and amendments thereto, relative to all or any part of the
Collateral. A carbon,

 

6

 

photographic, 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)                                 
Pledgor will furnish
to Secured Party, upon the request of Secured Party: (i) a certificate executed
by an authorized officer of Pledgor, and dated as of the date of delivery to
Secured Party, itemizing in such detail as Secured Party may request, the
Collateral which, as of the date of such certificate, has been delivered to
Secured Party by Pledgor pursuant to the provisions of this Agreement; and (ii)
such statements and schedules further identifying and describing the Collateral
and such other reports in connection with the Collateral as Secured Party may
request.

 

7.                                     
Covenants of Pledgor.

 

Pledgor shall:

 

(a)                                 
Perform each and
every covenant in the Loan Documents applicable to Pledgor;

 

(b)                                
Not change its
principal residence, if Pledgor is an individual, without giving Secured Party
at least thirty (30) days’ prior written notice thereof;

 

(c)                                 
Not, if Pledgor is an
entity, change its jurisdiction of organization or cease to be an entity, in
each case, without giving Secured Party at least thirty (30) days’ prior
written notice thereof;

 

(d)                                
To the extent it may
lawfully do so, use its best efforts to prevent the Issuers from issuing Future
Rights or Proceeds, except for cash dividends and other distributions to be
paid by any Issuer to Pledgor, unless any new Equity Interests associated with
Future Rights are pledged to Secured Party;

 

(e)                                 
Upon receipt by
Pledgor of any material notice, report, or other communication from any of the
Issuers or any Holder relating to all or any part of the Collateral, deliver
such notice, report or other communication to Secured Party as soon as possible,
but in no event later than five (5) days following the receipt thereof by
Pledgor.

 

8.                                     
Secured Party as Pledgor’s Attorney-in-Fact.

 

(a)                                 
Pledgor hereby
irrevocably appoints Secured Party as Pledgor’s attorney-in-fact, with full
authority in the place and stead of Pledgor and in the name of Pledgor, Secured
Party or otherwise, from time to time at Secured Party’s discretion, to take
any action and to execute any instrument that Secured Party may reasonably deem
necessary or advisable to accomplish the purposes of this Agreement, including:
(i) upon the occurrence and during the continuance of an Event of Default, to
receive, indorse, and collect all instruments made payable to Pledgor

 

7

 

representing any dividend, interest payment or other
distribution in respect of the Collateral or any part thereof to the extent
permitted hereunder and to give full discharge for the same and to execute and
file governmental notifications and reporting forms; (ii) to enter into any
control agreements Secured Party deems necessary pursuant to Section 3 of
this Agreement; or (iii) to arrange for the transfer of the Collateral on the
books of any of the Issuers or any other Person to the name of Secured Party or
to the name of Secured Party’s nominee.

 

(b)                                
In addition to the
designation of Secured Party as Pledgor’s attorney-in-fact in
subsection (a), Pledgor hereby irrevocably appoints Secured Party as
Pledgor’s agent and attorney-in-fact to make, execute and deliver any and all
documents and writings which may be necessary or appropriate for approval of,
or be required by, any regulatory authority located in any city, county, state
or country where Pledgor or any of the Issuers engage in business, in order to
transfer or to more effectively transfer any of the Pledged Interests or
otherwise enforce Secured Party’s rights hereunder.

 

9.                                     
Remedies upon Default.

 

Upon the occurrence and
during the continuance of an Event of Default:

 

(a)                                 
Secured Party may
exercise in respect of the Collateral, in addition to other rights and remedies
provided for herein or otherwise available to it, all the rights and remedies
of a secured party on default under the Code (irrespective of whether the Code
applies to the affected items of Collateral), and Secured Party may also
without notice (except as specified below) sell the Collateral or any part
thereof in one or more parcels at public or private sale, at any exchange,
broker’s board or at any of Secured Party’s offices or elsewhere, for cash, on
credit or for future delivery, at such time or times and at such price or
prices and upon such other terms as Secured Party may deem commercially
reasonable, irrespective of the impact of any such sales on the market price of
the Collateral. To the maximum extent permitted by applicable law, Secured
Party may be the purchaser of any or all of the Collateral at any such sale and
shall be entitled, for the purpose of bidding and making settlement or payment
of the purchase price for all or any portion of the Collateral sold at any such
public sale, to use and apply all or any part of the Obligations as a credit on
account of the purchase price of any Collateral payable at such sale. Each
purchaser at any such sale shall hold the property sold absolutely free from
any claim or right on the part of Pledgor, and Pledgor hereby waives (to the
extent permitted by law) all rights of redemption, stay, or appraisal that it
now has or may at any time in the future have under any rule of law or statute
now existing or hereafter enacted. Pledgor agrees that, to the extent notice of
sale shall be required by law, at least five (5) Business Days’ notice to
Pledgor of the time and place of any public sale or the time after which a
private sale is to be made shall constitute reasonable notification. Secured
Party shall not be obligated to make any sale of Collateral regardless of
notice of sale having been given. Secured Party 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. To the maximum extent permitted by law,
Pledgor hereby waives any claims against Secured Party

 

8

 

arising because the price at which any Collateral may
have been sold at such a private sale was less than the price that might have
been obtained at a public sale, even if Secured Party accepts the first offer
received and does not offer such Collateral to more than one offeree.

 

(b)                                
Pledgor hereby agrees
that any sale or other disposition of the Collateral conducted in conformity with
reasonable commercial practices of banks in the city and state where Secured
Party is located in disposing of property similar to the Collateral shall be
deemed to be commercially reasonable.

 

(c)                                 
Pledgor hereby acknowledges
that the sale by Secured Party of any Collateral pursuant to the terms hereof
in compliance with the Securities Act of 1933 as now in effect or as hereafter
amended, or any similar statute hereafter adopted with similar purpose or
effect (the “Securities Act”), as well as applicable “Blue Sky” or other state
securities laws, may require strict limitations as to the manner in which
Secured Party or any subsequent transferee of the Collateral may dispose
thereof. Pledgor acknowledges and agrees that in order to protect Secured
Party’s interest it may be necessary to sell the Collateral at a price less
than the maximum price attainable if a sale were delayed or were made in
another manner, such as a public offering under the Securities Act. Pledgor has
no objection to sale in such a manner and agrees that Secured Party shall have
no obligation to obtain the maximum possible price for the Collateral. Without
limiting the generality of the foregoing, Pledgor agrees that, upon the
occurrence and during the continuation of an Event of Default, Secured Party
may, subject to applicable law, from time to time attempt to sell all or any
part of the Collateral by a private placement, restricting the bidders and
prospective purchasers to those who will represent and agree that they are
purchasing for investment only and not for distribution. In so doing, Secured
Party may solicit offers to buy the Collateral or any part thereof for cash,
from a limited number of investors reasonably believed by Secured Party to be institutional
investors or other accredited investors who might be interested in purchasing
the Collateral. If Secured Party shall solicit such offers, then the acceptance
by Secured Party of one of the offers shall be deemed to be a commercially
reasonable method of disposition of the Collateral.

 

(d)                                
If Secured Party
shall determine to exercise its right to sell all or any portion of the
Collateral pursuant to this Section, Pledgor agrees that, upon request of
Secured Party, Pledgor will, at its own expense:

 

(i)                                    
use its best efforts
to execute and deliver, and cause the Issuers and the directors and officers
thereof to execute and deliver, all such instruments and documents, and to do
or cause to be done all such other acts and things, as may be necessary or, in
the opinion of Secured Party, advisable to register such Collateral under the
provisions of the Securities Act, and to cause the registration statement
relating thereto to become effective and to remain effective for such period as
prospectuses are required by law to be furnished, and to make all amendments
and supplements thereto and to the related prospectuses which, in the opinion
of Secured Party, are necessary or advisable, all in conformity with the
requirements of the Securities Act and the rules and regulations of the
Securities and Exchange Commission applicable thereto;

 

9

 

(ii)                                 
use its best efforts
to qualify the Collateral under the state securities laws or “Blue Sky” laws
and to obtain all necessary governmental approvals for the sale of the
Collateral, as requested by Secured Party;

 

(iii)                              
cause the Issuers to
make available to their respective security holders, as soon as practicable, an
earnings statement which will satisfy the provisions of Section 11(a) of
the Securities Act;

 

(iv)                             
execute and deliver,
or cause the officers and directors of the Issuers to execute and deliver, to
any person, entity or governmental authority as Secured Party may choose, any
and all documents and writings which, in Secured Party’s reasonable judgment,
may be necessary or appropriate for approval, or be required by, any regulatory
authority located in any city, county, state or country where Pledgor or the
Issuers engage in business, in order to transfer or to more effectively
transfer the Pledged Interests or otherwise enforce Secured Party’s rights
hereunder; and

 

(v)                                
do or cause to be
done all such other acts and things as may be necessary to make such sale of
the Collateral or any part thereof valid and binding and in compliance with
applicable law.

 

Pledgor acknowledges that
there is no adequate remedy at law for failure by it to comply with the
provisions of this Section and that such failure would not be adequately
compensable in damages, and therefore agrees that its agreements contained in
this Section may be specifically enforced.

 

(e)                                 
PLEDGOR EXPRESSLY
WAIVES TO THE MAXIMUM EXTENT PERMITTED BY LAW: (i) ANY CONSTITUTIONAL OR OTHER
RIGHT TO A JUDICIAL HEARING PRIOR TO THE TIME SECURED PARTY DISPOSES OF ALL OR
ANY PART OF THE COLLATERAL AS PROVIDED IN THIS SECTION; (ii) ALL RIGHTS OF
REDEMPTION, STAY, OR APPRAISAL THAT IT NOW HAS OR MAY AT ANY TIME IN THE FUTURE
HAVE UNDER ANY RULE OF LAW OR STATUTE NOW EXISTING OR HEREAFTER ENACTED; AND
(iii) EXCEPT AS SET FORTH IN SUBSECTION (a) OF THIS SECTION 9, ANY
REQUIREMENT OF NOTICE, DEMAND, OR ADVERTISEMENT FOR SALE.

 

10.                              
Application of Proceeds.

 

Upon the occurrence and during the continuance of an
Event of Default, any cash held by Secured Party as Collateral and all cash
Proceeds received by Secured Party in respect of any sale of, collection from,
or other realization upon all or any part of the Collateral pursuant to the
exercise by Secured Party of its remedies as a secured creditor as provided in
Section 9 shall be applied from time to time by Secured Party as provided
in the Loan Agreement.

 

10

 

11.                              
Indemnity and Expenses.

 

Pledgor agrees:

 

(a)                                 
To indemnify and hold
harmless the Released Parties (hereinafter defined) from and against any and
all claims, damages, demands, losses, obligations, judgments and liabilities
(including, without limitation, reasonable attorneys’ fees and expenses) in any
way arising out of or in connection with this Agreement or the Obligations, except
to the extent the same shall arise as a result of the gross negligence or
willful misconduct of the party seeking to be indemnified; and

 

(b)                                
To pay and reimburse
Secured Party upon demand for all reasonable costs and expenses (including,
without limitation, reasonable attorneys’ fees and expenses) that Secured Party
may incur in connection with (i) the custody, use or preservation of, or the
sale of, collection from or other realization upon, any of the Collateral, including
the reasonable expenses of re-taking, holding, preparing for sale or lease,
selling or otherwise disposing of or realizing on the Collateral, (ii) the
exercise or enforcement of any rights or remedies granted hereunder, under the
Loan Agreement, or under any of the other Loan Documents or otherwise available
to it (whether at law, in equity or otherwise), or (iii) the failure by Pledgor
to perform or observe any of the provisions hereof. The provisions of this
Section shall survive the execution and delivery of this Agreement, the
repayment of any of the Obligations, the termination of the commitments of
Secured Party under the Loan Agreement and the termination of this Agreement or
any other Loan Document.

 

12.                              
Duties of Secured Party.

 

The powers conferred on
Secured Party hereunder are solely to protect its interests in the Collateral
and shall not impose on it any duty to exercise such powers. Except as provided
in Section 9-207 of the Code, Secured Party shall have no duty with
respect to the Collateral or any responsibility for taking any necessary steps
to preserve rights against any Persons with respect to any Collateral.  It
is also expressly understood and agreed that except for the obligation of
“honesty in fact” as provided in Section 1.203 of the Texas Business and
Commerce Code (to the extent applicable),  the Secured Party, in
exercising its rights and performing its obligations under any of the Loan
Documents, owes no duty of good faith and/or fair dealing to Pledgor, Obligor,
any guarantor of the Obligations, or any shareholder of Obligor, and no
fiduciary duty exists between or among Pledgor, Obligor, any guarantor of the
Obligations, any shareholder of Obligor, and the Secured Party.

 

13.                              
Choice of Law.

 

The validity of this
Agreement, its construction, interpretation, and enforcement, and the rights of
the parties hereto shall be determined under, governed by, and construed in
accordance with the laws of the State of Texas (without reference to the choice
of law principles thereof).  The

 

11

 

Pledgor and Secured Party agree that any action or
claim arising out of, or any dispute in connection with, this Agreement, any
rights, remedies, obligations, or duties hereunder, or the performance or
enforcement hereof or thereof, shall be decided by binding arbitration as set
forth in the Loan Agreement.

 

14.                              
Amendments; etc.

 

No amendment or waiver of
any provision of this Agreement nor consent to any departure by Pledgor
herefrom shall in any event be effective unless the same shall be in writing
and signed by Secured Party, 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 Secured Party to exercise, and no delay in exercising
any right under this Agreement, any other Loan Document, or otherwise with
respect to any of the Obligations, shall operate as a waiver thereof; nor shall
any single or partial exercise of any right under this Agreement, any other
Loan Document, or otherwise with respect to any of the Obligations preclude any
other or further exercise thereof or the exercise of any other right. The
remedies provided for in this Agreement or otherwise with respect to any of the
Obligations are cumulative and not exclusive of any remedies provided by law.

 

15.                              
Notices.

 

Unless otherwise
specifically provided herein, all notices shall be in writing and either (i)
delivered against a written receipt therefor; or (ii) mailed by registered or
certified mail, return receipt requested; in each case addressed as follows:

 

	
   

  	
  (a)

  	
  If to Obligor, to:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  The Wornick Company

  	
   

  
	
   

  	
   

  	
   

  	
  Attention: Larry L.
  Rose, President and CEO

  	
   

  
	
   

  	
   

  	
   

  	
  10825 Kenwood Road

  	
   

  
	
   

  	
   

  	
   

  	
  Cincinnati, Ohio 45242

  	
   

  
	
   

  	
   

  	
   

  	
  with copy to:

  	
   

  
	
   

  	
   

  	
   

  	
  Robert B. McKeon

  	
   

  
	
   

  	
   

  	
   

  	
  Veritas Capital
  Management II, L.L.C.

  	
   

  
	
   

  	
   

  	
   

  	
  660 Madison Avenue

  	
   

  
	
   

  	
   

  	
   

  	
  New York, New York
  10021

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (b)

  	
  If to Pledgor, to:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  The respective address
  set forth on Schedule 2
  hereto.

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

12

 

	
   

  	
  (c)

  	
  If to Lender, to:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Texas State Bank

  	
   

  
	
   

  	
   

  	
  3900 North 10th Street

  	
   

  
	
   

  	
   

  	
  McAllen, Texas 78501

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: G. E. Roney,
  Chairman of the Board

  	
   

  

 

or to such other address as a party may hereafter
designate by notice to the other parties in accordance herewith.  Notices
shall be deemed to have been given (whether actually received or not) when
delivered or, if mailed, on the next Business Day.  All time references
used herein refer to Central Standard Time or Central Daylight Savings Time, as
then applicable in McAllen, Hidalgo County, Texas.

 

16.                              
Continuing Security Interest.

 

This Agreement shall
create a continuing security interest in the Collateral and shall: (a) remain
in full force and effect until the indefeasible payment in full of the
Obligations, including the cash collateralization, expiration, or cancellation
of all Obligations, if any, consisting of letters of credit, and the full and
final termination of any commitment to extend any financial accommodations
under the Loan Agreement; (b) be binding upon Pledgor and its successors and
assigns; and (c) inure to the benefit of Secured Party and its successors,
transferees, and assigns. Upon the indefeasible payment in full of the
Obligations, including the cash collateralization, expiration, or cancellation
of all Obligations, if any, consisting of letters of credit, and the full and
final termination of any commitment to extend any financial accommodations
under the Loan Agreement, the security interests granted herein shall
automatically terminate and all rights to the Collateral shall revert to
Pledgor. Upon any such termination, Secured Party will, at Pledgor’s expense,
execute and deliver to Pledgor such documents as Pledgor shall reasonably
request to evidence such termination. Such documents shall be prepared by
Pledgor and shall be in form and substance reasonably satisfactory to Secured
Party.

 

17.                              
Security Interest Absolute.

 

To the maximum extent
permitted by law, all rights of Secured Party, all security interests
hereunder, and all obligations of Pledgor hereunder, shall be absolute and
unconditional irrespective of:

 

(a)                                 
any lack of validity
or enforceability of any of the Obligations or any other agreement or
instrument relating thereto, including any of the Loan Documents;

 

(b)                                
any change in the
time, manner, or place of payment of, or in any other term of, all or any of
the Obligations, or any other amendment or waiver of or any consent to any
departure from any of the Loan Documents, or any other agreement or instrument
relating thereto;

 

13

 

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

 

(d)                                
any other
circumstances that might otherwise constitute a defense available to, or a
discharge of, Pledgor.

 

18.                              
Headings.

 

Section and
subsection headings in this Agreement are included herein for convenience
of reference only and shall not constitute a part of this Agreement or be given
any substantive effect.

 

19.                              
Severability.

 

In case any provision in
or obligation under this Agreement shall be invalid, illegal or unenforceable
in any jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.

 

20.                              
Counterparts; Telefacsimile Execution.

 

This Agreement may be
executed in one or more counterparts, each of which shall be deemed an original
and all of which together shall constitute one and the same Agreement. Delivery
of an executed counterpart of this Agreement by telefacsimile shall be equally
as effective as delivery of an original executed counterpart of this Agreement.
Any party delivering an executed counterpart of this Agreement by telefacsimile
also shall deliver an original executed counterpart of this Agreement but the
failure to deliver an original executed counterpart shall not affect the
validity, enforceability, or binding effect hereof.

 

21.                              
Waiver of Marshaling.

 

Each of Pledgor and
Secured Party acknowledges and agrees that in exercising any rights under or
with respect to the Collateral: (a) Secured Party is under no obligation to
marshal any Collateral; (b) may, in its absolute discretion, realize upon the
Collateral in any order and in any manner it so elects; and (c) may, in its
absolute discretion, apply the proceeds of any or all of the Collateral to the
Obligations in any order and in any manner it so elects. Pledgor and Secured
Party waive any right to require the marshaling of any of the Collateral.

 

14

 

NOTICE:
THIS AGREEMENT CONTAINS AN OBLIGATION FOR BINDING ARBITRATION.

 

THIS
WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND
MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES.

 

THERE
ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

IN WITNESS WHEREOF,
Pledgor and Secured Party have caused this Agreement to be duly executed and
delivered by their officers thereunto duly authorized as of the date first
written above.

 

[SIGNATURE PAGE
FOLLOWS]

 

15

 

	
   

  	
  PLEDGOR:

  
	
   

  	
   

  
	
   

  	
  TWC HOLDING LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Robert B. McKeon

  	
   

  
	
   

  	
  By:  Robert B.
  McKeon

  
	
   

  	
  Its:  
  Authorized Signatory

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  SECURED
  PARTY:

  
	
   

  	
   

  
	
   

  	
  TEXAS STATE BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Douglas G. Bready

  	
   

  
	
   

  	
  By:

  	
  Douglas G. Bready

  
	
   

  	
  Its:

  	
  President

  
	
   

  	
   

  	
   

  	
   

  

 

16

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00084-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00084-of-00352.parquet"}]]