Document:

Guaranty Agreement dtd January 14, 2003

 Exhibit 10.2 
  
  
 
 
  
 GUARANTY AGREEMENT 
  
  
 Dated as of January 14, 2003 
  
 by 
  
 EACH GUARANTOR PARTY HERETO 

 
 in favor of 
  
 WELLS FARGO BANK, NATIONAL ASSOCIATION, 
  
 as the Administrative Agent 
  
  
 

 GUARANTY AGREEMENT 
  
 This GUARANTY AGREEMENT (this “Guaranty”), dated as of January 14, 2003, is made by each of the Persons listed on the signature pages hereto and each of the other entities which
becomes a party hereto pursuant to Section 4.14 hereof (each a “Guarantor” and jointly and severally, the “Guarantors”) in favor of WELLS FARGO BANK, NATIONAL ASSOCIATION, as administrative agent for the
Lenders referred to below (in such capacity, together with its successors in such capacity, the “Administrative Agent”). 
  
 Each of the Guarantors is in the same corporate family as WEST MARINE FINANCE COMPANY, INC., a California corporation (the “Borrower”). Each Guarantor and Borrower are Subsidiaries of West Marine, Inc.

  
 The Borrower has entered into that certain Credit Agreement, dated of January 14, 2003 (as the same from time to
time hereafter may be amended, modified, supplemented or restated, the “Credit Agreement”), by and among the Borrower, the financial institutions party thereto from time to time (collectively, the “Lenders”) and the
Administrative Agent, pursuant to which the Lenders have agreed to extend loans and other financial accommodations to the Borrower for the purposes, and on the terms and subject to the conditions, set forth in the Credit Agreement. 

 
 The Lenders are willing to make and maintain loans and other financial accommodations to the Borrower on and after the date of
the Credit Agreement, but only upon the condition, among others, that the Guarantors shall have executed and delivered this Guaranty to the Administrative Agent. 
  
 Each Guarantor has obtained and will continue to obtain working capital and loans needed for its operations from Borrower, and Borrower will obtain funds to provide and lend to the Guarantors from the
Lenders under the Credit Agreement. In addition, Guarantors expect to realize direct and indirect benefits as the result of the availability of the aforementioned credit facilities to Borrower, as the result of financial or business support which
will be provided to the Guarantors by Borrower. 
  
 To induce the Administrative Agent and the Lenders to enter into,
and to extend credit under, the Credit Agreement and the other Loan Documents, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each Guarantor has agreed to guarantee the Guaranteed
Obligations upon the terms and conditions of this Guaranty. Accordingly, each Guarantor agrees with the Administrative Agent as follows: 
  
 SECTION 1. DEFINITIONS. 
  
 1.01. Definitions. Unless otherwise defined
herein, all capitalized terms used in this Guaranty that are defined in the Credit Agreement (including those terms incorporated by reference) shall have the respective meanings assigned to them in the Credit Agreement. In addition, the following
terms shall have the following meanings under this Guaranty: 
  
 “Bankruptcy Code” shall mean Title
11 of the United States Code. 

  
 “Guaranteed Obligations” shall mean (a) any and all Obligations
of the Borrower and any and all other obligations of the Borrower for the performance of its agreements, covenants and undertakings under or in respect of the Loan Documents, it being acknowledged by each Guarantor that some extensions of credit
under the Credit Agreement are available on a revolving basis, and (b) any and all other obligations of the Borrower for the payment of all amounts, liabilities and indebtedness (whether for principal, interest, reimbursement, fees, charges,
indemnification or otherwise) now or in the future owed to the Administrative Agent, the Lenders or any such Person individually, and for the performance by the Borrower of its agreements, covenants and undertakings, in each case under or in respect
of any and all of the Loan Documents and the Lender Interest Rate Protection Agreements, it being acknowledged by each Guarantor that such other obligations may arise or be created, incurred or assumed at any time and from time to time and in such
manner and such circumstances and with such terms and provisions as the Borrower, the Administrative Agent and the Lenders or any such Person individually may agree without notice or demand of any kind or nature whatsoever to the Guarantors.

  
 1.02. Interpretation. In this Guaranty, unless otherwise indicated, the singular includes the plural and
plural the singular; words importing any gender include the other gender; references to statutes or regulations are to be construed as including all statutory or regulatory provisions consolidating, amending or replacing the statute or regulation
referred to; references to “writing” include printing, typing, lithography and other means of reproducing words in a tangible visible form; the words “including,” “includes” and “include” shall be deemed to be
followed by the words “without limitation”; references to articles, sections (or subdivisions of sections), exhibits, annexes or schedules are to this Guaranty; references to agreements and other contractual instruments shall be deemed to
include all subsequent amendments, extensions and other modifications to such instruments (without, however, limiting any prohibition on any such amendments, extensions or modifications by the terms of the Credit Agreement); and references to
Persons include their respective successors and permitted assigns and, in the case of Governmental Authorities, Persons succeeding to their respective functions and capacities. 
  
 SECTION 2. THE GUARANTEE. 
  
 2.01. Guarantee. Subject to the limitation set forth in Section 2.09, each Guarantor hereby guarantees to the Administrative Agent and each Lender the timely payment in full when due (whether at stated maturity, by
acceleration or otherwise) and performance of the Guaranteed Obligations in each case strictly in accordance with their terms. Each Guarantor hereby further agrees that if the Borrower shall fail to pay in full when due (whether at stated maturity,
by acceleration or otherwise) all or any part of the Guaranteed Obligations, such Guarantor will immediately pay the same, without any demand or notice whatsoever, and that in the case of any extension of time of payment or renewal of all or any
part of the Guaranteed Obligations, the same will be timely paid in full when due (whether at extended maturity, by acceleration or otherwise) in accordance with the terms of such extension or renewal. This Guaranty is absolute, irrevocable and
unconditional in nature and is made with respect to any and all Guaranteed Obligations now existing or in the future arising. Each Guarantor’s liability under this Guaranty shall continue until full satisfaction of all Guaranteed Obligations.
This Guaranty is a guarantee of due and punctual payment and performance and not of collectibility. 

 
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 2.02. Acknowledgments, Waivers and Consents. Each Guarantor acknowledges
that the obligations undertaken by it under this Guaranty involve the guarantee of obligations of Persons other than such Guarantor and that such obligations of each Guarantor are absolute, irrevocable and unconditional under any and all
circumstances. In full recognition and in furtherance of the foregoing, each Guarantor agrees that: 
  
 (a) Without
affecting the enforceability or effectiveness of this Guaranty in accordance with its terms and without affecting, limiting, reducing, discharging or terminating the liability of such Guarantor, or the rights, remedies, powers and privileges of the
Administrative Agent and the Lenders under this Guaranty, the Administrative Agent and the Lenders may, at any time and from time to time and without notice or demand of any kind or nature whatsoever: 
  
       (i) amend, supplement, modify, extend, renew, waive, accelerate or otherwise change the time for
payment or performance of, or the terms of, all or any part of the Guaranteed Obligations (including any increase or decrease in the principal portion of, or rate or rates of interest on, all or any part of the Guaranteed Obligations); 

 
       (ii) amend, supplement, modify, extend, renew, waive or otherwise change, or enter into or
give, any Loan Document or any agreement, security document, guarantee, approval, consent or other instrument with respect to all or any part of the Guaranteed Obligations, any Loan Document or any such other instrument or any term or provision of
the foregoing; 
  
       (iii) accept or enter into new or additional agreements,
security documents, guarantees (including letters of credit) or other instruments in addition to, in exchange for or relative to any Loan Document, all or any part of the Guaranteed Obligations or any collateral now or in the future serving as
security for the Guaranteed Obligations; 
  
       (iv) accept or receive (including
from any other guarantor) partial payments or performance on the Guaranteed Obligations (whether as a result of the exercise of any right, remedy, power or privilege or otherwise); 
  
       (v) accept, receive and hold any additional collateral for all or any part of the Guaranteed Obligations (including from any other
guarantor); 
  
       (vi) release, reconvey, terminate, waive, abandon, allow to lapse
or expire, fail to perfect, subordinate, exchange, substitute, transfer, foreclose upon or enforce any collateral, security documents or guarantees (including letters of credit or the obligations of any other guarantor) for or relative to all or any
part of the Guaranteed Obligations; 
  
       (vii) apply any collateral or the
proceeds of any collateral or guarantee (including any letter of credit or the obligations of any other guarantor) to all or any part of the Guaranteed Obligations in such manner and extent as the Administrative Agent or any Lender may in its
discretion determine; 
  
       (viii) release any Person (including any other
guarantor) from any personal liability with respect to all or any part of the Guaranteed Obligations; 

 
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       (ix) settle, compromise, release, liquidate
or enforce upon such terms and in such manner as the Administrative Agent or the Lenders may determine or as applicable law may dictate all or any part of the Guaranteed Obligations or any collateral on or guarantee of (including any letter of
credit issued with respect to) all or any part of the Guaranteed Obligations (including with any other guarantor); 
  
       (x) consent to the merger or consolidation of, the sale of substantial assets by, or other restructuring or termination of the existence of the Borrower or any other Person (including any other
guarantor); 
  
       (xi) proceed against the Borrower, such Guarantor or any other
guarantor of (including any issuer of any letter of credit issued with respect to) all or any part of the Guaranteed Obligations or any collateral provided by any Person and exercise the rights, remedies, powers and privileges of the Administrative
Agent and the Lenders under the Loan Documents or otherwise in such order and such manner as the Administrative Agent or any Lender may, in its discretion, determine, without any necessity to proceed upon or against or exhaust any collateral, right,
remedy, power or privilege before proceeding to call upon or otherwise enforce this Guaranty as to such Guarantor; 
  
       (xii) foreclose upon any deed of trust, mortgage or other instrument creating or granting liens on any interest in real property by judicial or nonjudicial sale or by deed in lieu of foreclosure,
bid any amount or make no bid in any foreclosure sale or make any other election of remedies with respect to such liens or exercise any right of set-off; 
  
       (xiii) obtain the appointment of a receiver with respect to any collateral for all or any part of the Guaranteed Obligations and apply the proceeds of such
receivership as the Administrative Agent or any Lender may in its discretion determine (it being agreed that nothing in this clause (xiii) shall be deemed to make the Administrative Agent or any Lender a party in possession in contemplation of law,
except at its option); 
  
       (xiv) enter into such other transactions or business
dealings with the Borrower, any Subsidiary or Affiliate of the Borrower or any other guarantor of all or any part of the Guaranteed Obligations as the Administrative Agent or any Lender may desire; and 
  
       (xv) do all or any combination of the actions set forth in this Section 2.02(a). 

 
 (b) The enforceability and effectiveness of this Guaranty and the liability of such Guarantor, and the rights, remedies, powers
and privileges of the Administrative Agent and the Lenders, under this Guaranty shall not be affected, limited, reduced, discharged or terminated, and each Guarantor hereby expressly waives to the fullest extent not prohibited by applicable law any
defense now or in the future arising (other than a defense that the Guaranteed Obligations have been paid in full in cash), by reason of: 
  
       (i) the illegality, invalidity or unenforceability of all or any part of the Guaranteed Obligations, any Loan Document or any agreement, security document, guarantee or other instrument
relative to all or any part of the Guaranteed Obligations; 

 
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         (ii) any disability or other
defense with respect to all or any part of the Guaranteed Obligations of the Borrower, or any other guarantor of all or any part of the Guaranteed Obligations (including any issuer of any letters of credit), including the effect of any statute of
limitations that may bar the enforcement of all or any part of the Guaranteed Obligations or the obligations of any such other guarantor; 
  
         (iii) the illegality, invalidity or unenforceability of any security or guarantee (including any letter of credit) for all or any part of the Guaranteed Obligations or the lack
of perfection or continuing perfection or failure of the priority of any lien on any collateral for all or any part of the Guaranteed Obligations; 
  
         (iv) the cessation, for any cause whatsoever, of the liability of the Borrower or any other guarantor of all or any part of the Guaranteed Obligations
(other than, subject to Section 2.05, by reason of the full payment and performance of all Guaranteed Obligations); 
  
         (v) any failure of the Administrative Agent or any Lender to marshal assets in favor of the Borrower or any other Person (including any other guarantor), to exhaust any collateral for
all or any part of the Guaranteed Obligations, to pursue or exhaust any right, remedy, power or privilege it may have against the Borrower, any other guarantor of all or any part of the Guaranteed Obligations (including any issuer of any Letter of
Credit) or any other Person or to take any action whatsoever to mitigate or reduce such or any other liability of such Guarantor under this Guaranty, neither the Administrative Agent nor any Lender being under any obligation to take any such action
notwithstanding the fact that all or any part of the Guaranteed Obligations may be due and payable and that the Borrower may be in default of its obligations under any Loan Document; 
  
         (vi) any failure of the Administrative Agent or any Lender to give notice of sale or other disposition of any collateral
(including any notice of any judicial or nonjudicial foreclosure or sale of any interest in real property serving as collateral for all or any part of the Guaranteed Obligations) for all or any part of the Guaranteed Obligations to the Borrower,
such Guarantor or any other Person or any defect in, or any failure by such Guarantor or any other Person to receive, any notice that may be given in connection with any sale or disposition of any collateral; 
  
         (vii) any failure of the Administrative Agent or any Lender to comply with applicable laws
in connection with the sale or other disposition of any collateral for all or any part of the Guaranteed Obligations; 
  
         (viii) any judicial or nonjudicial foreclosure or sale of, or other election of remedies with respect to, any interest in real property or other collateral serving as security for all
or any part of the Guaranteed Obligations, even though such foreclosure, sale or election of remedies may impair the subrogation rights of such Guarantor or may preclude such Guarantor from obtaining reimbursement, contribution, indemnification or
other recovery from the Borrower, any other guarantor or any other Person and even though the Borrower may not, as a result of such foreclosure, sale or election of remedies, be liable for any deficiency; 

 
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         (ix) any act or omission of the
Administrative Agent, any Lender or any other Person that directly or indirectly results in or aids the discharge or release of the Borrower or any other guarantor of all or any part of the Guaranteed Obligations or any security or guarantee for all
or any part of the Guaranteed Obligations by operation of law or otherwise; 
  
         (x) any law which provides that the obligation of a surety or guarantor must neither be larger in amount nor in other respects more burdensome than that of the principal or which
reduces a surety’s or guarantor’s obligation in proportion to the principal obligation; 
  
         (xi) the possibility that the obligations of the Borrower to the Administrative Agent and the Lenders may at any time and from time to time exceed the aggregate liability of such
Guarantor under this Guaranty; 
  
         (xii) any counterclaim, set-off or
other claim which the Borrower or any other guarantor has or alleges to have with respect to all or any part of the Guaranteed Obligations; 
  
         (xiii) any failure of the Administrative Agent or any Lender to file or enforce a claim in any bankruptcy or other proceeding with respect to any Person.

  
         (xiv) the election by the Administrative Agent or any Lender in
any bankruptcy proceeding of any Person, of the application or nonapplication of Section 1111(b)(2) of the Bankruptcy Code; 
  
         (xv) any extension of credit or the grant of any Lien under Section 364 of the Bankruptcy Code; 
  
         (xvi) any use of cash collateral under Section 363 of the Bankruptcy Code; 
  
         (xvii) any agreement or stipulation with respect to the provision of adequate protection in any bankruptcy proceeding of any
Person; 
  
         (xviii) the avoidance of any Lien in favor of the
Administrative Agent or any Lender for any reason; 
  
         (xix) any
bankruptcy, insolvency, reorganization, arrangement, readjustment of debt, liquidation or dissolution proceeding commenced by or against any Person, including any discharge of, or bar or stay against collecting, all or any part of the Guaranteed
Obligations (or any interest on all or any part of the Guaranteed Obligations) in or as a result of any such proceeding; 
  
         (xx) any action taken by the Administrative Agent or any Lender, whether similar or dissimilar to any of the foregoing, that is authorized by this Section 2.02 or otherwise in
this Guaranty or by any other provision of any Loan Document or any omission to take any such action; or 

 
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       (xxi) any other circumstance whatsoever,
whether similar or dissimilar to any of the foregoing, that might otherwise constitute a legal or equitable discharge or defense of a surety or guarantor, including by reason of Sections 2787 to 2855, inclusive, 2899, 3275 and 3433 of the California
Civil Code, and any future judicial decisions or legislation or of any comparable provisions of the laws of any other jurisdiction. 
  
 (c) Each Guarantor has been made aware of the provisions of California Civil Code Section 2856, has read and understands the provisions of that statute, has been advised by its counsel as to the scope, purpose and effect of
that statute, and based thereon, and without limiting the foregoing waivers, each Guarantor agrees to waive all suretyship rights and defenses described in California Civil Code Section 2856(a). Without limiting any other waivers herein, each
Guarantor hereby gives the following waivers pursuant to Sections 2856(c) and 2856(d) of the California Civil Code: 
  
 “The guarantor waives all rights and defenses that the guarantor may have because the debtor’s debt is secured by real property. This means, among other things: 
  
 (1) The creditor may collect from the guarantor without first foreclosing on any real or personal property collateral pledged by the debtor; 
  
 (2) If the creditor forecloses on any real property collateral pledged by the debtor: 
  
 (A) The amount of the debt may be reduced only by the price for which that collateral is sold at the foreclosure sale, even if the
collateral is worth more than the sale price. 
  
 (B) The creditor may collect from the guarantor even if the
creditor, by foreclosing on the real property collateral, has destroyed any right the guarantor may have to collect from the debtor. 
  
 This is an unconditional and irrevocable waiver of any rights and defenses the guarantor may have because the debtor’s debt is secured by real property. These rights and defenses include, but are not limited to, any
rights or defenses based upon Section 580a, 580b, 580d, or 726 of the Code of Civil Procedure.” 
  
 (d) Each
Guarantor waives all rights and defenses arising out of an election of remedies by the Administrative Agent and the Lenders, even though that election of remedies, such as a nonjudicial foreclosure with respect to security for a guaranteed
obligation, has destroyed such Guarantor’s rights of subrogation and reimbursement against the principal by the operation of Section 580d of the Code of Civil Procedure or otherwise. 
  
 (e) Each Guarantor expressly waives, for the benefit of the Administrative Agent and the Lenders, all set-offs and counterclaims and all presentments, demands for payment
or performance, notices of nonpayment or nonperformance, protests, notices of protest, 

 
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 notices of dishonor and all other notices or demands of any kind or nature whatsoever with respect to the Guaranteed Obligations, and all
notices of acceptance of this Guaranty or of the existence, creation, incurring or assumption of new or additional Guaranteed Obligations. Each Guarantor further expressly waives the benefit of any and all statutes of limitation and any and all laws
providing for the exemption of property from execution or for valuation and appraisal upon foreclosure, to the maximum extent not prohibited by applicable law. 
  
 (f) Each Guarantor represents and warrants to the Administrative Agent and the Lenders that it has established adequate means of obtaining financial and other information pertaining to the business,
operations and condition (financial and otherwise) of the Borrower and its properties on a continuing basis and that such Guarantor is now and will in the future remain fully familiar with the business, operations and condition (financial and
otherwise) of the Borrower and its properties. Each Guarantor further represents and warrants that it has reviewed and approved each of the Loan Documents and is fully familiar with the transaction contemplated by the Loan Documents and that it will
in the future remain fully familiar with such transaction and with any new Loan Documents and the transactions contemplated by such Loan Documents. Each Guarantor hereby expressly waives and relinquishes any duty on the part of the Administrative
Agent or the Lenders (should any such duty exist) to disclose to such or any other guarantor any matter of fact or other information related to the business, operations or condition (financial or otherwise) of the Borrower or its properties or to
any Loan Document or the transactions undertaken pursuant to, or contemplated by, any such Loan Document, whether now or in the future known by the Administrative Agent or any Lender. 
  
 (g) Each Guarantor intends that its rights and obligations shall be those expressly set forth in this Guaranty and that its obligations shall not be affected, limited,
reduced, discharged or terminated by reason of any principles or provisions of law which conflict with the terms of this Guaranty. 
  
 (h) Nothing in this Guaranty amends, modifies or otherwise affects any agreement between Borrower, the Administrative Agent and the Lenders regarding the amendment of, modification of or supplement to any Loan Document.

  
 2.03. Understanding With Respect to Waivers and Consents. Each Guarantor warrants and agrees that each of
the waivers and consents set forth in this Guaranty is made voluntarily and unconditionally after consultation with outside legal counsel and with full knowledge of its significance and consequences, with the understanding that events giving rise to
any defense or right waived may diminish, destroy or otherwise adversely affect rights which such or any other guarantor otherwise may have against the Borrower, the Administrative Agent, any Lender or any other Person or against any collateral. If,
notwithstanding the intent of the parties that the terms of this Guaranty shall control in any and all circumstances, any such waivers or consents are determined to be unenforceable under applicable law, such waivers and consents shall be effective
to the maximum extent not prohibited by law. 
  
 2.04. Subrogation. Each Guarantor hereby agrees that,
until the payment and satisfaction in full of all of the Guaranteed Obligations and the expiration and termination of the commitments of the Lenders under the Loan Documents, it shall not exercise any right, remedy, power or privilege, such as any
right of subrogation, contribution or indemnity or related 

 
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 remedy, power or privilege, arising (whether by contract or operation of law, including under the
Bankruptcy Code) against the Borrower or any other guarantor of all or any part of the Guaranteed Obligations or any collateral for all or any part of the Guaranteed Obligations by reason of any payment or other performance pursuant to the
provisions of this Guaranty and, if any amount shall be paid to such Guarantor on account of such rights, remedies, powers or privileges, it shall hold such amount in trust for the benefit of, and pay the same over to, the Administrative Agent (for
the benefit of the Lenders) on account of the Guaranteed Obligations. Each Guarantor understands that the exercise by the Administrative Agent or any Lender of any right, remedy, power or privilege that it may have under the Loan Documents, any
agreement, security document, guarantee or other instrument relative to all or any part of the Guaranteed Obligations or otherwise may affect or eliminate such or any other guarantor’s right of subrogation or similar recovery against the
Borrower, any other guarantors or any collateral and that such Guarantor may therefore incur partially or totally nonreimbursable liability under this Guaranty. Nevertheless, each Guarantor hereby authorizes and empowers the Administrative Agent and
the Lenders to exercise, in its or their sole discretion, any combination of such rights, remedies, powers and privileges. 
  
 2.05. Reinstatement. The obligations of each Guarantor under this Guaranty shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of the Borrower, any other guarantor or
any other Person or any other application of funds (including the proceeds of any collateral for all or any part of the Guaranteed Obligations) in respect of all or any part of the Guaranteed Obligations is rescinded or must be otherwise restored by
any holder of such Guaranteed Obligations, whether as a result of any proceedings in bankruptcy, reorganization or otherwise and each Guarantor agrees that it will indemnify the Administrative Agent and each Lender on demand for all costs and
expenses (including fees and expenses of counsel) incurred by the Administrative Agent or such Lender in connection with such rescission or restoration. 
  
 2.06. Remedies. Each Guarantor hereby agrees that, between it and the Lenders, the obligations of the Borrower under the Credit Agreement and the other Loan Documents may be declared to
be forthwith (or may become automatically) due and payable as provided in the Credit Agreement for purposes of Section 2.01 notwithstanding any stay, injunction or other prohibition preventing such declaration (or such obligations becoming
due and payable as against the Borrower) and that, in the event of such declaration (or such obligation being deemed due and payable), such obligations (whether or not due and payable by the Borrower) shall forthwith become due and payable for
purposes of Section 2.01. 
  
 2.07. Separate Action. The Administrative Agent may bring and
prosecute a separate action or actions against each Guarantor (or any one of them) whether or not the Borrower, any other guarantor or any other Person is joined in any such action or a separate action or actions are brought against the Borrower,
any other guarantor, any other Person, or any collateral for all or any part of the Guaranteed Obligations. The obligations of each Guarantor under, and the effectiveness of, this Guaranty are not conditioned upon the existence or continuation of
any other guarantee (including any letter of credit) of all or any part of the Guaranteed Obligations. By its acceptance hereof, each Lender agrees that this Guaranty may be enforced only by action of the Administrative Agent upon the instructions
of the Required Lenders and that no Lender shall have any right individually to seek to enforce this Guaranty. 

 
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 2.08. Subordination of Indebtedness of the Borrower. Each Guarantor
agrees that any indebtedness of the Borrower now or in the future owed to such Guarantor is hereby subordinated to the Guaranteed Obligations. If the Administrative Agent so requests after the occurrence and during the continuation of an Event of
Default, any such indebtedness shall be collected, enforced and received by any Guarantor as trustee for the Administrative Agent and shall be paid over to the Administrative Agent (for the benefit of the Lenders) in kind on account of the
Guaranteed Obligations. If, after the Administrative Agent’s request, any Guarantor fails to collect or enforce any such indebtedness or to pay the proceeds of such indebtedness to the Administrative Agent, the Administrative Agent as such
Guarantor’s attorney-in-fact may do such acts and sign such documents in such Guarantor’s name and on such Guarantor’s behalf as the Administrative Agent considers necessary or desirable to effect such collection, enforcement or
payment, the Administrative Agent being hereby appointed each Guarantor’s attorney-in-fact for such purpose. 
  
 2.09. Limitation on Guarantee. If under any applicable law (including without limitation state and Federal fraudulent transfer laws) the obligations of any Guarantor under Section 2.01 would otherwise be held or
determined to be void, invalid or unenforceable or if the claims of the Lenders in respect of such obligations would be subordinated to the claims of any other creditors on account of such Guarantor’s liability under Section 2.01, then,
notwithstanding any other provision of this Guaranty to the contrary, the amount of such liability shall, without any further action by the Guarantors, any Lender, the Administrative Agent or any other Person, be automatically limited and reduced to
the highest amount which is valid and enforceable and not subordinated to the claims of other creditors as determined in such action or proceeding. Each Guarantor agrees and acknowledges that it has obtained and will continue to obtain working
capital and loans needed for its operations from Borrower, and Borrower will obtain funds to provide and lend to the Guarantors from the Lenders under the Credit Agreement and each Guarantor agrees and acknowledges that it is receiving reasonably
equivalent value in the form of (i) the substantial advances being made to such Guarantor through Borrower under the Credit Agreement for its ongoing operations and (ii) the direct and indirect benefits as the result of the availability of the
aforementioned credit facilities to Borrower, as the result of financial or business support which will be provided to the Guarantors by Borrower. 
  
 2.10. Revocation. To the fullest extent not prohibited by law, each Guarantor hereby waives all right of revocation with respect to the Guaranteed Obligations. 
  
 2.11. Right to Offset Balances. Each Guarantor agrees that, in addition to (and without any limitation of) any right of set-off,
banker’s lien or counterclaim any Lender may otherwise have, each Lender shall be entitled, at its option but only with the prior written consent of the Administrative Agent, to offset balances held by it for the account of such Guarantor at
any of its offices, in Dollars or in any other currency, against any Obligations of the Borrower to such Lender after the occurrence and during the continuance of an Event of Default (regardless of whether such balances are then due to such
Guarantor). Any Lender so entitled shall promptly notify the applicable Guarantor and the Administrative Agent of any offset effected by it; provided that such Lender’s failure to give such notice shall not affect the validity of such
offset or the obligations of any Guarantor hereunder or under any other Loan Document. 

 
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 SECTION 3. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE GUARANTORS.

  
 (a) In order to induce the Administrative Agent and the Lenders to enter into the Credit
Agreement and the other Loan Documents, to make Advances and to issue and participate in Letters of Credit thereunder, each Guarantor represents and warrants to the Administrative Agent and each of the Lenders, as of the date hereof and as of the
date of any advance, loan or other transfer of Property from Borrower directly or indirectly to such Guarantor, that all representations and warranties in Article 4 of the Credit Agreement which are applicable to such Guarantor are true and correct
in all material respects as if such Guarantor were a party to the Credit Agreement. 
  
 (b) So long
as any Advance or Letter of Credit remains unpaid, or any other non-contingent Obligation remains unpaid or unperformed, or any portion of any of the Commitments remains in force, each Guarantor shall, and shall cause each of each other Guarantor
to, unless the Requisite Lenders otherwise consent, comply with all covenants, agreements and requirements of Article 5 of the Credit Agreement that are applicable to such Guarantor as if such Guarantor were a party to the Credit Agreement and each
Guarantor expressly agrees to be bound thereby. 
  
 (c) So long as any Advance or Letter of Credit
remains unpaid, or any other non-contingent Obligation remains unpaid or unperformed, or any portion of any of the Commitments remains in force, each Guarantor shall not, and shall not permit any other Guarantor to, unless the Requisite Lenders or,
if required by Section 11.2 of the Credit Agreement, all of the Lenders, otherwise consent, fail to comply with all covenants, agreements, restrictions and requirements of Article 6 of the Credit Agreement that are applicable to such
Guarantor as if such Guarantor were a party to the Credit Agreement and each Guarantor expressly agrees to be bound thereby. 
  
 (d) All other provisions contained in the Credit Agreement and all provisions contained in any other Loan Document that apply to Loan Documents generally are fully applicable to this Guaranty and are
incorporated herein by this reference, including, without limitation, Article 10 and 11 of the Credit Agreement and all other the representations, warranties, covenants, arbitration provisions and negative covenants that apply to Borrower, Parent
and their Subsidiaries as set forth in the Credit Agreement and each Guarantor expressly agrees to be bound thereby as if such Guarantor were a party to each Loan Document. 
  
 SECTION 4. MISCELLANEOUS PROVISIONS. 
  
 4.01. Waiver. No failure or delay by the Administrative Agent or any Lender in exercising any remedy, right, power or privilege under this Guaranty or any other Loan Document shall operate as a waiver of such remedy, right,
power or privilege, nor shall any 

 
 -11- 

 single or partial exercise of such remedy, right, power or privilege preclude any other or further exercise of such remedy, right, power or
privilege or the exercise of any other remedy, right, power or privilege. The remedies, rights, powers and privileges provided by this Guaranty are, to the extent not prohibited by law, cumulative and not exclusive of any remedies, rights, powers or
privileges provided by the other Loan Documents or by law. 
  
 4.02. Notices. All notices, requests, demands,
consents, instructions and other communications to or upon the Guarantors or any one of them (care of the Borrower) or the Administrative Agent under this Guaranty shall be given as provided in Section 11.6 of the Credit Agreement.

  
 4.03. Expenses, Etc. Each Guarantor agrees to pay or to reimburse the Administrative Agent and the Lenders
for all costs and expenses (including fees and expenses of counsel) that may be incurred by the Administrative Agent or the Lenders in any effort to enforce any of the obligations of the Guarantors under this Guaranty, whether or not any lawsuit is
filed, including all such costs and expenses (and attorneys’ fees and expenses) incurred by the Administrative Agent and the Lenders in any bankruptcy, reorganization, workout or similar proceeding. All amounts due under this Guaranty
(including under Section 2.01) and not paid when due shall bear interest until paid at a per annum rate equal to the Alternate Base Rate plus the Applicable Alternate Base Rate Margin for Alternate Base Rate Advances plus two
percent (2.00%). 
  
 4.04. Amendments, Etc. No amendment, modification, supplement, extension, termination or
waiver of any provision of this Guaranty, no approval or consent thereunder, and no consent to any departure by any Guarantor therefrom, may in any event be effective unless in writing signed by the Administrative Agent with the written approval or
upon the instructions of the Requisite Lenders, and then only in the specific instance and for the specific purpose given and any such amendment, modification, supplement, extension, termination or waiver shall be binding upon the Administrative
Agent, each holder of Guaranteed Obligations and the Guarantors; and, without the approval in writing of all the Lenders, no amendment, modification, supplement, termination, waiver or consent may be effective as to the matters set forth in the
Credit Agreement, including, without limitation, except as expressly provided in the Credit Agreement, the release of any Guarantor and no amendment, modification, or supplement of any provision of this Guaranty may in any event be effective unless
in writing signed by each Guarantor who is a party to the Guaranty at the time any such amendment, modification, or supplement is made. Nothing herein shall in any way modify or limit the effect of terms or conditions set forth in any other
document, instrument or agreement executed by any Guarantor or applicable to any Guarantor or in connection with the Guarantied Obligations, but each and every term and condition hereof shall be in addition thereto. 
  
 4.05. Successors and Assigns. This Guaranty shall be binding upon and inure to the benefit of the Guarantors, the Administrative
Agent and their respective successors and assigns. No Guarantor may assign or transfer its rights or obligations under this Guaranty without the prior written consent of the Required Lenders. Any attempted assignment or transfer in violation of this
Section 4.05 shall be null and void. 

 
 -12- 

  
 4.06. Survival. All representations and warranties made in this Guaranty
or in any certificate or other document delivered pursuant to or in connection with this Guaranty shall survive the execution and delivery of this Guaranty or such certificate or other document (as the case may be) or any deemed repetition of any
such representation or warranty. 
  
 4.07. ENTIRE AGREEMENT. THIS GUARANTY REPRESENTS THE COMPLETE AND FINAL
AGREEMENT AMONG THE GUARANTORS AND THE ADMINISTRATIVE AGENT AND SUPERSEDES ALL PRIOR AGREEMENTS, WRITTEN OR ORAL, ON THE SUBJECT MATTER HEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF SUCH
PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN OR AMONG THE GUARANTORS, THE ADMINISTRATIVE AGENT AND THE LENDERS. 
  
 4.08. Partial Invalidity. If at any time any provision of this Guaranty is or becomes illegal, invalid or unenforceable in any respect under the law of any jurisdiction, neither the legality, validity or enforceability of the
remaining provisions of this Guaranty nor the legality, validity or enforceability of such provision under the law of any other jurisdiction shall in any way be affected or impaired thereby. 
  
 4.09. Captions. The table of contents, captions and section headings appearing in this Guaranty are included solely for convenience of reference and are not intended
to affect the interpretation of any provision of this Guaranty. 
  
 4.10. Counterparts. This Guaranty may be
executed in any number of counterparts, all of which taken together shall constitute one and the same instrument and any of the parties to this Guaranty may execute this Guaranty by signing any such counterpart. Transmission by telecopier of an
executed counterpart of this Guaranty shall be deemed to constitute due and sufficient delivery of such counterpart. 
  
 4.11. GOVERNING LAW; SUBMISSION TO JURISDICTION. THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA. 
  
 EACH GUARANTOR HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA AND OF ANY CALIFORNIA STATE COURT
SITTING IN SAN FRANCISCO, CALIFORNIA FOR THE PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS CONTEMPLATED BY THIS GUARANTY. EACH GUARANTOR IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

 
 -13- 

  
 4.12. WAIVER OF JURY TRIAL. EACH GUARANTOR HEREBY IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS CONTEMPLATED BY THIS GUARANTY. 
  
 4.13. Power of Attorney. Each Guarantor hereunder hereby grants to the Borrower an irrevocable power of attorney to act as its attorney-in-fact with regard to
matters relating to this Guaranty and each other Loan Document after the occurrence and during the continuance of an Event of Default, including execution and delivery of any amendments, supplements, waivers or other modifications hereto or thereto,
receipt of any notices hereunder or thereunder and receipt of service of process in connection herewith or therewith. Each Guarantor hereby explicitly acknowledges that the Administrative Agent has executed and delivered this Guaranty and each other
Loan Document to which it is a party, and has performed its obligations under this Guaranty and each other Loan Document to which it is a party, in reliance upon the irrevocable grant of such power of attorney pursuant to this Section 4.13.

  
 4.14. Additional Guarantors. If, pursuant to the terms and conditions of the Credit Agreement, the
Borrower shall be required to cause any Subsidiary of Borrower or Parent that is not a Guarantor to become a Guarantor hereunder, such Subsidiary shall execute and deliver to the Administrative Agent a Joinder Agreement in the form of Annex 1
and shall thereafter for all purposes be a party hereto and have the same rights, benefits and obligations as a Guarantor party hereto. 
  
 [This Space Intentionally Left Blank] 

 
 -14- 

  
 IN WITNESS WHEREOF, the undersigned have executed this Guaranty as of the date
first above written. 
  
 
	 GUARANTOR(S):
  
  
 WEST MARINE, INC.,
 a Delaware
corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 WEST MARINE PRODUCTS, INC.,
 a California corporation
 
	 
	 By:
 	 	 /s/    Russell Solt      
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 

  
 
	 WEST MARINE PUERTO RICO, INC.,
 a California corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 W MARINE MANAGEMENT COMPANY, INC.,
 a California corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 WEST MARINE LBC, INC.,
 a California corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 

  
 
	 WEST MARINE IHC I, INC.,
 a California corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 E&B MARINE INC.,
 a Delaware corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 E & B MARINE LBC, INC.,
 a California corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 E & B MARINE IHC I, INC.,
 a California corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 

  
 
	 E & B MARINE SUPPLY, INC.,
 a New Jersey corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 E & B MARINE SUPPLY, INC.,
 a Maryland corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 GOLDBERGS’ MARINE DISTRIBUTORS, INC.,
 a Delaware
corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 JAMES BLISS & CO., INC.,
 a Massachusetts corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 

  
 
	 SEA RANGER MARINE INC.,
 a Delaware corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 KRISTA CORPORATION,
 a Delaware corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 CENTRAL MARINE SUPPLY, INC.,
 a New Jersey corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President 
 and Chief Financial Officer
 [Printed Name & Title]
 

 

 ANNEX 1 
  
 JOINDER AGREEMENT 
  
 This JOINDER
AGREEMENT, dated as of                 ,         , is delivered pursuant to
Section 4.14 of the Guaranty Agreement dated as of January 14, 2003, among one or more direct and indirect Subsidiaries of West Marine, Inc. and West Marine Finance Company, Inc. (“Borrower”) from time to time party thereto
as Guarantors in favor of Wells Fargo Bank, National Association, as administrative agent for the Lenders referred to therein (the “Guaranty Agreement”). Capitalized terms used herein but not defined herein are used herein with the
meaning given them in the Guaranty Agreement. 
  
 By executing and delivering this Joinder Agreement, the
undersigned, as provided in Section 4.14 of the Guaranty Agreement, hereby becomes a party to the Guaranty Agreement as a Guarantor thereunder with the same force and effect as if originally named as a Guarantor therein. 

 
 The undersigned at all times will obtain working capital and loans needed for its operations from Borrower, and Borrower will
obtain funds to provide and lend to the Guarantors from the Lenders under the Credit Agreement. In addition, the undersigned expect to realize direct and indirect benefits as the result of the availability of the aforementioned credit facilities to
Borrower, as the result of financial or business support which will be provided to the undersigned by Borrower. 
  
 The undersigned hereby represents and warrants that each of the representations and warranties contained in or incorporated into the Guaranty Agreement applicable to it is true and correct in all material respects on and as the date
hereof as if made on and as of such date. 
  
 IN WITNESS WHEREOF, the undersigned has caused this Joinder Agreement
to be duly executed and delivered as of the date first above written. 
  
 
	 [ADDITIONAL GUARANTOR]
 
	 
	 By:
 	 	 

	  	 	 Name:
 Title:
 

 
  
  
 
	 ACKNOWLEDGED AND AGREED
 as of the date of this Joinder
Agreement
 first above written.
 
	 
	 WELLS FARGO BANK, NATIONAL
ASSOCIATION,
 as Administrative Agent
 
	 
	 By:
 	 	 

	 Name:
 Title:Security Agreement dtd January 14, 2003

  
 Exhibit 10.3 
  
 SECURITY AGREEMENT 
  
 THIS
SECURITY AGREEMENT, dated as of January 14, 2003, is entered into by and among WEST MARINE FINANCE COMPANY, INC., a California corporation (the “Company”), each other signatory to this Security Agreement (other than the
Administrative Agent), each of the other entities which becomes a party hereto pursuant to Section 10.15 hereof (each of the foregoing, including the Company, a “Grantor” and collectively, the “Grantors”),
and WELLS FARGO BANK, NATIONAL ASSOCIATION, as administrative agent (in such capacity, the “Administrative Agent”) for the financial institutions which are from time to time parties to the Credit Agreement referred to in Recital
A below (collectively, the “Lenders”). 
  
 RECITALS 
  
 A. Pursuant to that certain Credit Agreement, dated as of even date herewith (as amended, supplemented or otherwise modified from time to
time, the “Credit Agreement”), among the Company, the Lenders and the Administrative Agent, the Lenders have agreed to extend loans and other financial accommodations to the Company upon the terms and subject to the conditions set
forth therein. 
  
 B. The Lenders’ obligations to extend loans and other financial accommodations to the Company
under the Credit Agreement are subject, among other conditions, to receipt by the Administrative Agent of this Security Agreement duly executed by the Grantors. 
  
 C. Each Grantor (other than Company) is or shall become a party to that certain Guaranty dated as of even date herewith in connection with the Credit Agreement. Each Grantor (other than Company) has
obtained and will continue to obtain working capital and loans needed for its operations from Company, and Company will obtain funds to provide and lend to the Grantors (other than Company) from the Lenders under the Credit Agreement. In addition,
Grantors (other than Company) expect to realize direct and indirect benefits as the result of the availability of the aforementioned credit facilities to Company and as the result of financial or business support which will be provided to the
Grantors (other than Company) by Company. 
  
 AGREEMENT 
  

NOW, THEREFORE, in consideration of the above recitals and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, each
of the Grantors hereby agrees with the Administrative Agent, for itself and for the ratable benefit of the Administrative Agent and the Lenders, as follows: 
  
 SECTION 1. Definitions and Interpretation. When used in this Security Agreement, the following terms shall have the following respective meanings: 
  
 “Account Debtor” means any “account debtor,” as such term is defined in Section 9102(a)(3) of the UCC (or any
other then applicable provision of the UCC). 

 

  
 “Account” means any “account,” as such term is defined
in Section 9102(a)(2) of the UCC (or any other then applicable provision of the UCC) and, in any event, shall include, without limitation, all accounts receivable, book debts and other forms of obligations (other than forms of obligations evidenced
by Chattel Paper, Documents or Instruments) now owned or hereafter received or acquired by or belonging or owing to any Grantor (including, without limitation, under any trade name, style or division thereof) whether arising out of goods sold or
services rendered by such Grantor or from any other transaction, whether or not the same involves the sale of goods or services by such Grantor (including, without limitation, any such obligation which may be characterized as an account or contract
right under the UCC) and all of any Grantor’s rights in, to and under all purchase orders or receipts now owned or hereafter acquired by it for goods sold or services rendered by such Grantor, and all of any Grantor’s rights to any goods
represented by any of the foregoing (including, without limitation, unpaid seller’s rights of rescission, replevin, reclamation and stoppage in transit and rights to returned, reclaimed or repossessed goods), and all monies due or to become due
to any Grantor under all purchase orders and contracts for the sale of goods or the performance of services or both by any Grantor (whether or not yet earned by performance on the part of such Grantor or in connection with any other transaction),
now in existence or hereafter occurring, including, without limitation, the right to receive the proceeds of said purchase orders and contracts, and all collateral security and guarantees of any kind given by any Person with respect to any of the
foregoing. 
  
 “Chattel Paper” means any “chattel paper,” as such term is defined in
Section 9102(a)(11) of the UCC (or any other then applicable provision of the UCC), including, without limitation, electronic chattel paper and tangible chattel paper. 
  
 “Collateral” shall have the meaning assigned to such term in Section 2 of this Security Agreement. 
  
 “Commercial Tort Claim” means any “commercial tort claim,” as such term is defined in Section 9102(a)(13) of
the UCC (or any other then applicable provision of the UCC). 
  
 “Contracts” means all contracts,
undertakings, franchise agreements or other agreements (other than rights evidenced by Chattel Paper, Documents or Instruments) in or under which any Grantor may now or hereafter have any right, title or interest, including, without limitation, with
respect to an Account, any agreement relating to the terms of payment or the terms of performance thereof. 
  
 “Deposit Account” means any “deposit account” as such term is defined in Section 9102(a)(29) of the UCC (or any other then applicable provision of the UCC), and shall include, without limitation, any
demand, time, savings passbook or like account, now or hereafter maintained by or for the benefit of any Grantor, or in which any Grantor now holds or hereafter acquires any interest, with a bank, savings and loan association, credit union or like
organization (including the Administrative Agent) and all funds and amounts therein, whether or not restricted or designated for a particular purpose. 
  
 “Documents” means any “documents,” as such term is defined in Section 9102(a)(30) of the UCC (or any other then applicable provision of the UCC). 

 

  
 “Equipment” means any “equipment,” as such term is
defined in Section 9109(a)(33) of the UCC (or any other then applicable provision of the UCC), now or hereafter owned or acquired by any Grantor or in which any Grantor now holds or hereafter acquires any interest and, in any event, shall include,
without limitation, all machinery, equipment, fixtures, furniture, furnishings, trade fixtures, vehicles, trucks, mainframe, personal and other computers, terminals and printers and related components and accessories, all copiers, telephonic, video,
electronic data-processing, data storage equipment and other equipment of any nature whatsoever, and any and all additions, substitutions and replacements of any of the foregoing, wherever located, together with all attachments, components, parts,
equipment and accessories installed thereon or affixed thereto. 
  
 “General Intangible” means any
“general intangible,” as such term is defined in Section 9102(a)(42) of the UCC (or any other then applicable provision of the UCC) and, in any event, shall include, without limitation, all right, title and interest which any Grantor may
now or hereafter have in or under any Contract, all customer lists, all proprietary or confidential information, inventions (whether or not patented or patentable), interests in partnerships, joint ventures and other business associations, permits,
books and records, goodwill, claims in or under insurance policies, including unearned premiums, Payment Intangibles, Software, cash and other forms of money or currency, rights to receive tax refunds and other payments and rights of
indemnification. 
  
 “Instruments” means any “instrument,” as such term is defined in
Section 9102(a)(47) of the UCC (or any other then applicable provision of the UCC) including, without limitation, all notes and all other evidences of indebtedness, other than instruments that constitute, or are a part of a group of writings that
constitute, Chattel Paper. 
  
 “Inventory” means any “inventory,” as such term is defined
in Section 9102(a)(48) of the UCC (or any other then applicable provision of the UCC), wherever located, now or hereafter owned or acquired by any Grantor or in which any Grantor now holds or hereafter acquires any interest, and, in any event, shall
include, without limitation, all inventory, goods and other personal property which are held by or on behalf of any Grantor for sale or lease or are furnished or are to be furnished under a contract of service or which constitute raw materials, work
in process or materials used or consumed or to be used or consumed in any Grantor’s business, or the processing, packaging, promotion, delivery or shipping of the same, and all finished goods whether or not such inventory is listed on any
schedules, assignments or reports furnished to the Administrative Agent from time to time and whether or not the same is in transit or in the constructive, actual or exclusive occupancy or possession of any Grantor or is held by any Grantor or by
others for any Grantor’s account, including, without limitation, all goods covered by purchase orders and contracts with suppliers and all goods billed and held by suppliers and all inventory of any Grantor which may be located on the premises
of any Grantor or of any carriers, forwarding agents, truckers, warehousemen, vendors, selling agents or other persons. 
  
 “Investment Property” means any “investment property,” as such term is defined in Section 9102(a)(49) of the UCC (or any other then applicable provision of the UCC) and shall include, without limitation,
all certificated securities (including, without limitation, those listed on Schedule I), uncertificated securities, security entitlements, Securities Accounts, commodity contracts and commodity accounts as each such term is defined in the
UCC. 

 

  
 “Letter-of-Credit Right” means “letter-of-credit
right,” as such term is defined in Section 9102(a)(51) of the UCC (or any other then applicable provision of the UCC). 
  
 “Payment Intangible” means “payment intangible,” as such term is defined in Section 9102(a)(61) of the UCC (or any other then applicable provision of the UCC). 
  
 “Pledged Collateral” means, collectively, the notes, stock, partnership interests, limited liability company interests,
and all other Investment Property of any Grantor, all certificates or other instruments representing any of the foregoing, all security entitlements of any Grantor in respect of any of the foregoing, all dividends, interest distributions, cash,
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 the foregoing. 
  
 “Proceeds” means “proceeds,” as such term is defined in Section 9102(a)(64) of the UCC (or any other then applicable provision of the UCC), and,
in any event, shall include, without limitation, (a) any and all Accounts, Chattel Paper, Instruments, cash or other forms of money or currency or other proceeds payable to any Grantor from time to time in respect of the Collateral, (b) any and all
proceeds of any insurance, indemnity, warranty or guaranty payable to any Grantor from time to time with respect to any of the Collateral, (c) any and all payments (in any form whatsoever) made or due and payable to any Grantor from time to time in
connection with any requisition, confiscation, condemnation, seizure or forfeiture of all or any part of the Collateral by any governmental authority (or any Person acting under color of governmental authority), (d) all certificates, dividends,
cash, Instruments and other property received or distributed in respect of or in exchange for any Investment Property, and (e) any and all other amounts from time to time paid or payable under or in connection with any of the Collateral.

  
 “Secured Obligations” shall mean and include (a) in the case of the Company, the Obligations (as
defined in the Credit Agreement) and (b) in the case of each other Grantor, all liabilities and obligations, howsoever arising, owed by such Grantor to the Administrative Agent or any Lender of every kind and description (whether or not evidenced by
any note or instrument and whether or not for the payment of money), direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, under or pursuant to the terms of the Guaranty or any of the other Loan
Documents to which such Grantor is a party, including without limitation all interest (including interest that accrues after the commencement of any bankruptcy or other insolvency proceeding by or against such Grantor), fees, charges, expenses,
attorneys’ fees and accountants’ fees payable by the Grantor hereunder and thereunder. 
  
 “Securities Account” means “securities account,” as such term is defined in Section 8501(a) of the UCC (or any other then applicable provision of the UCC). 
  
 “Security Agreement” means this Security Agreement and all exhibits hereto, as the same may from time to time be amended,
modified, supplemented or restated. 
  
 “Software” means “software,” as such term is
defined in Section 9102(a)(75) of the UCC (or any other then applicable provision of the UCC). 
  
 “Supporting Obligation” means “supporting obligation,” as such term is defined in Section 9102(a)(77) of the UCC (or any other then applicable provision of the UCC). 

 

  
 “UCC” means the Uniform Commercial Code as the same may, from
time to time, be in effect in the State of California; provided, however, in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection or priority of the Administrative Agent’s
security interest in any collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of California, the term “UCC” shall mean the Uniform Commercial Code as in effect in such other jurisdiction
for purposes of the provisions hereof relating to such attachment, perfection of priority and for purposes of definitions related to such provisions. 
  
 Unless otherwise defined herein, all other capitalized terms used herein and defined in the Credit Agreement shall have the respective meanings given to those terms in the Credit Agreement, and all terms defined in the UCC shall have
the respective meanings given to those terms in the UCC. The rules of interpretation set forth in Article 1 of the Credit Agreement shall, to the extent not inconsistent with the terms of this Security Agreement, apply to this Security Agreement and
are hereby incorporated by reference. 
  
 SECTION 2. Grant of Security Interest. As security for
the full, prompt, complete and final payment when due (whether at stated maturity, by acceleration or otherwise) and prompt performance and observance of all the Secured Obligations of such Grantor, and in order to induce the Administrative Agent
and the Lenders to enter into the Credit Agreement and to make loans and other financial accommodations available to and for the benefit of the Company upon the terms and subject to the conditions thereof, each Grantor hereby assigns, conveys,
mortgages, pledges, grants, hypothecates and transfers to the Administrative Agent for itself and for the pro rata benefit of the Lenders a security interest in and to all of such Grantor’s right, title and interest in, to and under each of the
following, whether now owned or hereafter acquired by such Grantor or in which such Grantor now holds or hereafter acquires any interest (all of which being hereinafter collectively called the “Collateral”): 
  
 (a) All Accounts; 
  
 (b) All Chattel Paper; 
  
 (c) All Commercial Tort Claims; 

 
 (d) All Contracts; 
  
 (e) All Deposit Accounts; 
  
 (f) All Documents;

  
 (g) All Equipment; 
  
 (h) All General Intangibles; 
  
 (i) All Instruments and all Pledged Collateral; 
  
 (j) All Inventory; 

 

  
 (k) All Investment Property; 
  
 (l) All Letter-of-Credit Rights; 
  
 (m) All Supporting Obligations; 
  
 (n) All property
of such Grantor held by the Administrative Agent or any Lender, or any other party for whom the Administrative Agent or any Lender is acting as agent hereunder, including, without limitation, all property of every description now or hereafter in the
possession or custody of or in transit to the Administrative Agent, any Lender or such other party, for any purpose, including, without limitation, safekeeping, collection or pledge, for the account of such Grantor, or as to which such Grantor may
have any right or power; 
  
 (o) All other goods and personal property of such Grantor whether tangible or
intangible and whether now or hereafter owned or existing, leased, consigned by or to, or acquired by, such Grantor and wherever located; and 
  
 (p) To the extent not otherwise included, all Proceeds of each of the foregoing and all accessions to, substitutions and replacements for, and rents, profits and products of each of the
foregoing; 
  
 provided, however, that any intangible Collateral shall be excluded from the lien and security interest granted by a
Grantor hereunder to the extent, but only to the extent, that, after giving effect to the application of Sections 9406 through 9409 of the UCC, the creation of a lien and security interest therein would constitute a material breach of the terms of
such Collateral, or would permit any party to any agreement, instrument or other document comprising such Collateral, or the issuer of any license, permit or authorization comprising such Collateral, to terminate such agreement, instrument or other
document or license, permit or authorization or would otherwise violate any applicable law, rule, regulation or policy of any Governmental Agency pursuant to any effective term or provision of such agreement, instrument, document, license, permit or
authorization. 
  
 SECTION 3. Rights of the Administrative Agent; Collection of Accounts.

  
 (a) Notwithstanding anything contained in this Security Agreement to the contrary, each Grantor expressly
agrees that such Grantor shall not default under any of its Contracts, it shall observe and perform all the conditions and obligations to be observed and performed by it thereunder and that it shall perform all of its duties and obligations
thereunder, all in accordance with and pursuant to the terms and provisions of each such Contract to the extent any such default or failure to observe and perform could reasonably be expected to have a Material Adverse Effect; and provided,
however, that such Grantor may suspend performance of its obligations under any such Contract in the event of a material breach of such Contract by a third party. The Administrative Agent shall not have any obligation or liability
under any Contract by reason of or arising out of this Security Agreement or the granting to the Administrative Agent of a security interest therein or the receipt by the Administrative Agent of any payment relating to any Contract pursuant hereto,
nor shall the Administrative Agent be required or obligated in any manner to perform or fulfill any of the obligations of any Grantor under or pursuant to any Contract, or to make any payment, or to make any inquiry as to the 

 

  
 nature or the sufficiency of any payment received by it or the sufficiency of any performance by any
party under any Contract, or to present or file any claim, or to take any action to collect or enforce any performance or the payment of any amounts which may have been assigned to it or to which it may be entitled at any time or times.

  
 (b) The Administrative Agent authorizes each Grantor to collect the respective Accounts of such Grantor,
provided, that the Administrative Agent may, upon the occurrence and during the continuation of any Event of Default and without notice, limit or terminate said authority at any time. If required by the Administrative Agent at any time during
the continuation of any Event of Default, any Proceeds, when first collected by a Grantor, received in payment of such Account or in payment for any of its Inventory or on account of any of its Contracts shall be promptly deposited by such Grantor
in precisely the form received (with all necessary endorsements) in a special bank account maintained by the Administrative Agent subject to withdrawal by the Administrative Agent only, as hereinafter provided, and until so turned over shall be
deemed to be held in trust by such Grantor for and as the Administrative Agent’s property, and shall not be commingled with such Grantor’s other funds or properties. Such Proceeds, when deposited, shall continue to be collateral security
for all of the Secured Obligations and shall not constitute payment thereof until applied as hereinafter provided. Upon the occurrence and during the continuation of any Event of Default, the Administrative Agent may, in its sole discretion, apply
all or a part of the funds on deposit in said special account to the principal of or interest on or both in respect of any of the Secured Obligations in accordance with the provisions of Section 7(g), below, and any part of such funds which
the Administrative Agent elects not to so apply and deems not required as collateral security for the Secured Obligations shall be paid over from time to time by the Administrative Agent to the Grantors. If an Event of Default has occurred and is
continuing, at the request of the Administrative Agent, each Grantor shall deliver to the Administrative Agent all original and other documents evidencing, and relating to, the sale and delivery of such Inventory and each Grantor shall deliver all
original and other documents evidencing and relating to, the performance of labor or service which created such Accounts, including, without limitation, all original orders, invoices and shipping receipts. 
  
 (c) Upon the occurrence and during the continuation of any Event of Default, the Administrative Agent may at any time, without
notice to or consent from any Grantor, notify Account Debtors of any Grantor, parties to the Contracts of any Grantor, obligors in respect of Instruments of any Grantor and obligors in respect of Chattel Paper of any Grantor that the Accounts and
the right, title and interest of any Grantor in and under such Contracts, Instruments, and Chattel Paper have been assigned to the Administrative Agent, and that payments shall be made directly to the Administrative Agent. Upon the request of the
Administrative Agent after the occurrence and during the continuation of an Event of Default, each Grantor shall so notify such Account Debtors, parties to such Contracts, obligors in respect of such Instruments and obligors in respect of such
Chattel Paper. Upon the occurrence and during the continuation of an Event of Default, the Administrative Agent may, in its name, or in the name of others communicate with such Account Debtors, parties to such Contracts, obligors in respect of such
Instruments and obligors in respect of such Chattel Paper to verify with such parties, to the Administrative Agent’s satisfaction, the existence, amount and terms of any such Accounts, Contracts, Instruments or Chattel Paper. 

 

  
 SECTION 4. Representations and Warranties. Each Grantor
hereby represents and warrants to the Administrative Agent and the Lenders that: 
  
 (a) Such Grantor is the
sole legal and equitable owner of each item of the Collateral in which it purports to grant a security interest hereunder, having good title or rights thereto free and clear of any and all Liens, except for the Permitted Encumbrances. 

 
 (b) Such Grantor has not filed, authorized or consented to the filing of any effective security agreement, financing
statement, equivalent security or lien instrument or continuation statement covering all or any part of the Collateral, except such as may have been filed by such Grantor in favor of the Administrative Agent pursuant to this Security Agreement or
such as relate to other Permitted Encumbrances. 
  
 (c) This Security Agreement creates a legal and valid
security interest on and in all of the Collateral in which such Grantor now has rights and in which security interests are governed by the UCC or other applicable Law, and all filings and other actions necessary to perfect and protect such security
interest have been duly taken in respect of such Collateral. Accordingly, the Administrative Agent has a fully perfected first priority security interest in all of such Collateral in which such Grantor now has rights, subject only to the Permitted
Encumbrances. This Security Agreement will create a legal and valid and fully perfected first priority security interest in such Collateral in which such Grantor later acquires rights, when such Grantor acquires those rights, subject only to the
Permitted Encumbrances. 
  
 (d) As of the date hereof and as of the last day of each Fiscal Quarter, each
Grantor’s exact legal name is set forth on Schedule V attached hereto (as supplemented by Company on each Compliance Certificate). Each Grantor was formed under the laws of the jurisdiction of its formation as set forth on Schedule
V attached hereto. As of the date hereof and as of the last day of each Fiscal Quarter, each Grantor’s chief executive office, principal place of business, and the place where each Grantor maintains records concerning the Collateral are set
forth on Schedule V attached hereto (as supplemented by Company on each Compliance Certificate). A material portion of the Collateral, other than Deposit Accounts and Investment Property held in Securities Accounts, is as of the date hereof
and as of the last day of each Fiscal Quarter located at the location(s) set forth on Schedule V attached hereto (as supplemented by Company on each Compliance Certificate) or Schedule 4.22 to the Credit Agreement (as updated from time
to time as set forth in the Credit Agreement) or is being transported to one of such location(s) and may be located on the premises of carriers, forwarding agents, truckers, warehousemen, vendors, selling agents or other persons. No Grantor shall
change such chief executive office or principal place of business or remove or cause to be removed, except in the ordinary course of such Grantor’s business, the Collateral or the records concerning the Collateral from those premises without
prior written notice to the Administrative Agent. Each Grantor (other than Company) shall provide to Company all information necessary to supplement to Schedule V and Schedule 4.22 to the Credit Agreement as referenced above.

  
 (e) All Collateral with respect to which a security interest may be perfected by the secured party’s
taking possession thereof, including, without limitation, all Chattel Paper, Instruments and certificated securities (other than Instruments to be promptly deposited for collection) as of the date hereof and as of the last day of each Fiscal
Quarter, is set 

 

  
 forth on Schedule I (as supplemented by Company on each Compliance Certificate) except for items
of Collateral with a value of less than $10,000 in the aggregate. All action necessary to protect and perfect such security interest in each item set forth on Schedule I (as supplemented by Company on each Compliance Certificate) including,
without limitation, the delivery of all originals thereof to the Administrative Agent has been duly taken, or shall have been taken as of the Closing Date. All Letter-of-Credit Rights and Commercial Torts Claims of each Grantor as of the date hereof
and as of the last day of each Fiscal Quarter are set forth on Schedule II (as supplemented by Company on each Compliance Certificate). The security interest of the Administrative Agent in the Collateral is prior in right and interest to all
other Liens, other than Permitted Encumbrances, and is enforceable as such against creditors of and purchasers from such Grantor. Each Grantor (other than Company) shall provide to Company all information necessary to supplement to Schedule I
and Schedule II as referenced above. 
  
 (f) The names and addresses of all financial institutions at
which each Grantor maintains its Deposit Accounts and the account numbers of such Deposit Accounts are listed as of the date hereof and as of the last day of each Fiscal Quarter on Schedule III (as supplemented by Company on each Compliance
Certificate). Each Grantor (other than Company) shall provide to Company all information necessary to supplement to Schedule III. 
  
 (g) The names and addresses of all institutions at which each Grantor maintains its Securities Accounts and the account numbers and account names of such Securities Accounts are listed as of the date hereof and as of
the last day of each Fiscal Quarter on Schedule IV (as supplemented by Company on each Compliance Certificate). Each Grantor (other than Company) shall provide to Company all information necessary to supplement to Schedule IV.

  
 (h) Such Grantor is the sole holder of record and the sole beneficial owner of all certificated
securities and uncertificated securities pledged to the Administrative Agent by such Grantor under Section 2 of this Security Agreement, assuming that the Administrative Agent does not have notice of any adverse claim to the security, free
and clear of any adverse claim, as defined in Section 8102(a)(1) of the UCC (or any other then applicable provision of the UCC), except for the Lien created in favor of the Administrative Agent by this Security Agreement and the other Loan Documents
and Permitted Encumbrances described in paragraph (b) of the definition of that term. 
  
 SECTION 5.
Covenants. Each Grantor covenants and agrees with the Administrative Agent that from and after the date of this Security Agreement and until the non-contingent Secured Obligations have been completely and finally paid in full:

  
 5.1 Further Assurances; Pledge of Instruments. At any time and from time to time, upon the
written request of the Administrative Agent, and at the sole expense of the Grantors, each Grantor shall promptly and duly execute and deliver any and all such further instruments and documents and take such further action as the Administrative
Agent may reasonably deem desirable to obtain the full benefits of this Security Agreement and of the rights and powers herein granted, including, without limitation, (a) except as otherwise provided in the Credit Agreement, using its commercially
reasonable efforts to secure all consents and approvals necessary or appropriate for the grant of a security interest to the Administrative Agent in any 

 

  
 Contract or license held by any Grantor or in which any Grantor has any rights not heretofore assigned,
(b) filing any financing statements, amendments or continuation statements under the UCC with respect to the security interests granted hereby, (c) filing or cooperating with the Administrative Agent in filing any forms or other documents required
to be filed with the United States Patent and Trademark Office, United States Copyright Office, or any filings in any foreign jurisdiction or under any international treaty, required to secure or protect the Administrative Agent’s interest in
the Collateral, (d) transferring Collateral (other than Instruments to be promptly deposited for collection) to the Administrative Agent’s possession (if a security interest in such Collateral can be perfected and free from an adverse claim
only by possession), (e) obtaining agreements from landlords, warehousemen and mortgagees as required pursuant to the Credit Agreement, (f) doing all things necessary to protect any Grantor’s and the Administrative Agents interest in any
Inventory sold on consignment, including, without limitation, the filing of financing statements in applicable jurisdictions and assigning any such financing statements to the Administrative Agent, (g) using commercially reasonable efforts to obtain
written acknowledgements from consignees and bailees of the prior lien of the Administrative Agent in and to the Collateral and that such third party is holding possession of the Collateral for the benefit of the Administrative Agent, and (h)
assisting the Administrative Agent in obtaining control under the UCC with respect to any Collateral consisting of Deposit Accounts, Investment Property, Letter-of-Credit Rights and Electronic Chattel Paper. Each Grantor also hereby authorizes the
Administrative Agent, to the extent not prohibited by applicable law, to file any such financing statement, amendment or continuation statement without the signatures of such Grantor. If any amount payable under or in connection with any of the
Collateral is or shall become evidenced by any Instrument, such Instrument, other than checks and notes received in the ordinary course of any Grantor’s business, shall be duly endorsed in a manner satisfactory to the Administrative Agent and
delivered to the Administrative Agent promptly upon any Grantor’s receipt thereof; provided that the inadvertent failure to so endorse and deliver any Instruments with a value of less than $10,000 in the aggregate shall not be a breach
of this sentence. 
  
 5.2 Maintenance of Records. Each Grantor shall keep and maintain at such
Grantor’s own cost and expense satisfactory and complete records of the Collateral, including, without limitation, a record of all payments received and all credits granted with respect to the Collateral and all other dealings with the
Collateral. If requested by the Administrative Agent, all Chattel Paper shall be marked with the following legend: “This writing and the obligations evidenced or secured hereby are subject to the security interest of Wells Fargo Bank, National
Association, as Administrative Agent, created by that certain Security Agreement, dated as of January 14, 2003, in favor of Wells Fargo Bank, National Association, as Administrative Agent, as the same may thereafter from time to time be amended,
modified, supplemented or restated.” 
  
 5.3 Indemnification. In any suit, proceeding or
action brought by or against the Administrative Agent or any Lender relating to any Collateral, including, without limitation, any Account, Chattel Paper, Contract, General Intangible, Instrument or Document for any sum owing thereunder, or to
enforce any provision of any Collateral, including, without limitation, any Account, Chattel Paper, Contract, General Intangible, Instrument or Document, each Grantor shall jointly and severally save, indemnify and keep the Administrative Agent
harmless from and against all expense, loss or damage suffered by reason of any defense, setoff, counterclaim, recoupment or reduction of liability whatsoever of the obligor thereunder arising out of a breach 

  
 by any Grantor of any obligation thereunder or arising out of any other agreement, indebtedness or
liability at any time owing to, or in favor of, such obligor or its successors from any Grantor, except to the extent caused by the gross negligence or willful misconduct of the Administrative Agent, and all such obligations of the Grantors shall be
and remain enforceable against and only against the Grantors and shall not be enforceable against the Administrative Agent. 
  
 5.4 Compliance With Terms of Accounts, Etc. Each Grantor shall perform and comply with all obligations in respect of Accounts, Chattel Paper, Contracts, Documents, Instruments and Licenses and all other
agreements to which it is a party or by which it is bound if failure to conform and comply could reasonably be expected to have a Material Adverse Effect; provided, however, that such Grantor may suspend its performance
thereunder in the event of a material breach of any such obligations by third parties. 
  
 5.5
Limitation on Liens on Collateral. No Grantor shall create, permit or suffer to exist, and shall defend the Collateral against and take such other action as is necessary to remove, any lien on the Collateral, except the Permitted
Encumbrances. Each Grantor shall, jointly and severally, further defend the right, title and interest of the Administrative Agent in and to any of any Grantor’s rights under the Chattel Paper, Contracts, Documents, General Intangibles,
Instruments and Investment Property and to the Equipment and Inventory and in and to the Proceeds thereof against the claims and demands of all Persons whomsoever. 
  
 5.6 Limitations on Modifications of Accounts, Etc. Upon the occurrence and during the continuation of any Event of Default, no Grantor shall, without
the Administrative Agent’s prior written consent, grant any extension of the time of payment of any of the Accounts, Chattel Paper, Instruments or amounts due under any Contract or Document, compromise, compound or settle the same for less than
the full amount thereof, release, wholly or partly, any Person liable for the payment thereof, or allow any credit or discount whatsoever thereon other than trade discounts and rebates granted in the ordinary course of such Grantor’s business.

  
 5.7 Maintenance of Insurance. Each Grantor shall maintain, with financially sound and
reputable companies, the insurance policies with coverage provisions as set forth in Section 5.4 of the Credit Agreement. 
  
 5.8 Taxes, Assessments, Etc. Each Grantor shall pay promptly when due all property and other taxes, assessments and government charges or levies imposed upon, and all claims (including claims for labor, materials
and supplies) against, the Equipment or Inventory, except to the extent the validity or amount thereof is being contested in good faith, by appropriate proceeding and adequate reserves, to the extent required by GAAP, are being maintained in
connection therewith. 
  
 5.9 Limitations on Disposition. Except as described on Schedule 4.26
to the Credit Agreement, each Grantor shall keep the Collateral separate and identifiable from other property located on the same premises as the Collateral and no Grantor shall sell, lease, license outside the ordinary course of its business,
transfer or otherwise dispose of any of the Collateral, or attempt or contract to do so, except as permitted by Section 6.3 of the Credit Agreement. 

 

  
 5.10 Further Identification of Collateral. Each Grantor
shall, if so requested by the Administrative Agent, furnish to the Administrative Agent, as often as the Administrative Agent shall reasonably request, statements and schedules further identifying and describing the Collateral and such other reports
in connection with the Collateral as the Administrative Agent may reasonably request, all in reasonable detail. 
  
 5.11 Notices. Each Grantor shall advise the Administrative Agent promptly, in reasonable detail, of (a) any material lien, other than Permitted Encumbrances, attaching to or asserted against any of the
Collateral, (b) any material change in the composition of the Collateral and (c) the occurrence of any other event which could reasonably be expected to have or result in a Material Adverse Effect with respect to the Collateral or on the security
interest created hereunder. 
  
 5.12 Right of Inspection and Audit. Each Grantor shall permit
the Administrative Agent such rights of inspection and audit as provided in the Credit Agreement. In addition, upon reasonable notice to a Grantor (unless an Event of Default has occurred and is continuing, in which case no notice is necessary), the
Administrative Agent and its agents and representatives shall also have the right during such Grantor’s ordinary business hours, but without interfering with such Grantor’s normal business operations (unless an Event of Default has
occurred and is continuing, in which case such inspection and audits may be performed any anytime and without regard to any interference with such Grantor’s normal business operations), to enter into and upon any premises of such Grantor where
any of the Equipment or Inventory is located for the purpose of conducting audits and making physical verifications of such Equipment and Inventory and test verifications of the Accounts in any manner and through any medium that it considers
advisable, and each Grantor agrees to furnish all such assistance and information as the Administrative Agent may reasonably require in connection therewith. 
  
 5.13 Maintenance of Facilities. Each Grantor shall maintain and protect its properties, assets and facilities, including, without limitation, its Equipment (other than Equipment
determined by the Grantor in the ordinary course of business to be obsolete) in good order and working repair and condition (taking into consideration ordinary wear and tear) and from time to time make or cause to be made all needful and proper
repairs, renewals and replacements thereto and shall competently manage and care for its property in accordance with prudent industry practices. 
  
 5.14 Continuous Perfection. No Grantor shall change its name, identity or corporate structure in any manner unless such Grantor shall have given the Administrative Agent at least
thirty (30) days’ prior written notice thereof and shall have taken all action (or made arrangements to take such action substantially simultaneously with such change if it is impossible to take such action in advance) necessary or reasonably
requested by the Administrative Agent to amend such financing statement or continuation statement so that it is not seriously misleading. 
  
 5.15 Authorizations with Respect to Financing Statements, etc. Each Grantor hereby irrevocably authorizes the Administrative Agent at any time and from time to time to file in any filing office in any
UCC jurisdiction any initial financing statements and amendments thereto that (i) indicate the Collateral (A) as “all assets” of such Grantor or words of 

 

  
 similar effect, regardless of whether any particular asset comprised in the Collateral falls within the
scope of Article 9 of the UCC of such jurisdiction, or (B) as being of an equal or lesser scope or with greater detail, and (ii) contain any other information required by part 5 of Article 9 of the UCC for the sufficiency or filing office acceptance
of any financing statement or amendment, including (A) whether such Grantor is an organization, the type of organization and any organization identification number issued to such Grantor, and (B) in the case of a financing statement filed as a
fixture filing or indicating any Collateral as as-extracted collateral or timber to be cut, a sufficient description of the real property to which such Collateral relates. Each Grantor agrees to furnish any such information to the Administrative
Agent promptly upon request. Each Grantor also ratifies its authorization for the Administrative Agent to have filed in any UCC jurisdiction any initial financing statements or amendments thereto if filed prior to the date hereof. 

 
 5.16 No Reincorporation. No Grantor shall reincorporate or reorganize itself under the laws of any
jurisdiction other than the jurisdiction in which it is incorporated or organized as of the date hereof without the prior written consent of the Administrative Agent. 
  
 5.17 Terminations and Amendments Not Authorized. Each Grantor acknowledges that it is not authorized to file any amendment or termination
statement with respect to any financing statement relating to any security interest granted hereunder without the prior written consent of the Administrative Agent and agrees that it will not do so without the prior written consent of the
Administrative Agent, subject to such Grantor’s rights under Section 9509(d)(2) of the UCC. 
  
 5.18
Pledged Collateral. 
  
 (a) Each Grantor shall deliver to the Administrative Agent, all
certificates or Instruments representing or evidencing any Pledged Collateral, other than Instruments to be promptly deposited for collection, whether now existing or hereafter acquired, in suitable form for transfer by delivery or, as applicable,
accompanied by such Grantor’s endorsement, where necessary, or duly executed instruments of transfer or assignment in blank, all in form and substance reasonably satisfactory to the Administrative Agent. After the occurrence of an Event of
Default and during its continuance without prior notice to any Grantor, the Administrative Agent shall have the right, at any time in its discretion, to transfer to or to register in its name or in the name of its nominees any or all of the Pledged
Collateral. The Administrative Agent shall have the right at any time to exchange certificates or instruments representing or evidencing any of the Pledged Collateral for certificates or instruments of smaller or larger denominations. 

 
 (b) Except as provided in Section 7, each Grantor shall be entitled to receive all dividends paid and distributions and
other payments made in respect of the Pledged Collateral. Any sums paid upon or in respect of any of the Pledged Collateral upon the liquidation or dissolution of any issuer of any of the Pledged Collateral, any distribution of capital made on or in
respect of any of the Pledged Collateral or any property distributed upon or with respect to any of the Pledged Collateral pursuant to the recapitalization or reclassification of the capital of any issuer of Pledged Collateral or pursuant to the
reorganization thereof shall, unless otherwise subject to a perfected security interest in favor of the Administrative Agent, be 

 

  
 delivered to the Administrative Agent to be held by it hereunder as additional collateral security for
the Secured Obligations of such Grantor. If any sums of money or property so paid or distributed pursuant to the immediately preceding sentence in respect of any of the Pledged Collateral shall be received by such Grantor, such Grantor shall, until
such money or property is paid or delivered to the Administrative Agent, hold such money or property in trust for the Administrative Agent, segregated from other funds of such Grantor, as additional security for the Secured Obligations of such
Grantor. 
  
 (c) Except as provided in Section 7, such Grantor will be entitled to exercise all voting,
consent and rights with respect to the Pledged Collateral; provided, however, that no vote shall be cast, consent given or right exercised or other action taken by such Grantor which would be inconsistent with or result in any
violation of any provision of the Credit Agreement, this Agreement, any other Loan Document or, without prior notice to the Administrative Agent, to enable or take any other action to permit any issuer of Pledged Collateral to issue any stock or
other Securities of any nature or to issue any other securities convertible into or granting the right to purchase or exchange for any stock or other Securities of any nature of any issuer of Pledged Collateral. 
  
 (d) No Grantor shall grant control over any Investment Property to any Person other than the Administrative Agent. 

 
 (e) In the case of each Grantor which is an issuer of Pledged Collateral, such Grantor agrees to be bound by the terms of this
Security Agreement relating to the Pledged Collateral issued by it and will comply with such terms insofar as such terms are applicable to it. In the case of each Grantor which is a partner in a partnership, such Grantor hereby consents to the
extent required by the applicable partnership agreement to the pledge by each other Grantor, pursuant to the terms hereof, of the pledged partnership interests in such partnership and to the transfer of such pledged partnership interests to the
Administrative Agent or its nominee and to the substitution of the Administrative Agent or its nominee as a substituted partner in such partnership with all the rights, powers and duties of a general partner or a limited partner, as the case may be.
In the case of each Grantor which is a member of a limited liability company, such Grantor hereby consents to the extent required by the applicable limited liability company agreement to the pledge by each other Grantor, pursuant to the terms
hereof, of the pledged limited liability company interests in such limited liability company and to the transfer of such pledged limited liability company interests to the Administrative Agent or its nominee and to the substitution of the
Administrative Agent or its nominee as a substituted member of the limited liability company with all the rights, powers and duties of a member of the limited liability company in question. 
  
 (f) No Grantor shall agree to any provision in, or amendment of, a limited liability company agreement or partnership agreement that adversely affects the perfection of
the security interest of the Administrative Agent in any pledged partnership interests or pledged limited liability company interests pledged by such Grantor hereunder, including electing to treat the membership interest or partnership interest of
such Grantor as a security under Section 8-103 of the UCC. 

 

  
 SECTION 6. The Administrative Agent’s Appointment as
Attorney-in-Fact. 
  
 (a) Subject to Section 6(b) below, each Grantor hereby irrevocably
constitutes and appoints the Administrative Agent, and any officer or agent thereof, with full power of substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in the place and stead of such Grantor and in the
name of such Grantor or in its own name, from time to time at the Administrative Agent’s discretion, for the purpose of carrying out the terms of this Security Agreement, to take any and all appropriate action and to execute and deliver any and
all documents and instruments which may be necessary or desirable to accomplish the purposes of this Security Agreement and, without limiting the generality of the foregoing, hereby gives the Administrative Agent the power and right, on behalf of
such Grantor, without notice to or assent by such Grantor to do the following: 
  
 (i) to ask, demand,
collect, receive and give acquittances and receipts for any and all monies due or to become due under any Collateral and, in the name of such Grantor, in its own name or otherwise to take possession of, endorse and collect any checks, drafts, notes,
acceptances or other Instruments for the payment of monies due under any Collateral and to file any claim or to take or commence any other action or proceeding in any court of law or equity or otherwise deemed appropriate by the Administrative Agent
for the purpose of collecting any and all such monies due under any Collateral whenever payable; 
  
 (ii) to
pay or discharge any Liens, including, without limitation, any tax lien, levied or placed on or threatened against the Collateral, to effect any repairs or any insurance called for by the terms of this Security Agreement and to pay all or any part
of the premiums therefor and the costs thereof, which actions shall be for the benefit of the Administrative Agent and not any Grantor; and 
  
 (iii) to (1) direct any person liable for any payment under or in respect of any of the Collateral to make payment of any and all monies due or to become due thereunder directly to the
Administrative Agent or as the Administrative Agent shall direct, (2) receive payment of any and all monies, claims and other amounts due or to become due at any time arising out of or in respect of any Collateral, (3) sign and endorse any invoices,
freight or express bills, bills of lading, storage or warehouse receipts, drafts against Grantors, assignments, verifications and notices in connection with Accounts and other Instruments and Documents constituting or relating to the Collateral, (4)
commence and prosecute any suits, actions or proceedings at law or in equity in any court of competent jurisdiction to collect the Collateral or any part thereof and to enforce any other right in respect of any Collateral, (5) defend any suit,
action or proceeding brought against any Grantor with respect to any Collateral, (6) settle, compromise or adjust any suit, action or proceeding described above and, in connection therewith, give such discharges or releases as the Administrative
Agent may deem appropriate, (7) sell, transfer, pledge, make any agreement with respect to or otherwise deal with any of the Collateral as fully and completely as though the Administrative Agent were the absolute owner thereof for all purposes, and
to do, at the Administrative Agent’s option and the Grantors’ expense, at any time, or from time to time, all acts and things which the Administrative Agent may reasonably deem necessary to protect, preserve or realize upon the Collateral
and the Administrative Agent’s security interest therein in order to effect the intent of this Security Agreement, all as fully and effectively as Grantors might do. 

 

  
 (b) The Administrative Agent agrees that, except upon the occurrence and
during the continuation of an Event of Default, it shall not exercise the power of attorney or any rights granted to the Administrative Agent pursuant to this Section 6. Each Grantor hereby ratifies, to the extent not prohibited by law, all
that said attorney shall lawfully do or cause to be done by virtue hereof. The power of attorney granted pursuant to this Section 6 is a power coupled with an interest and shall be irrevocable until the Secured Obligations are completely and
paid and performed in full. 
  
 (c) The powers conferred on the Administrative Agent hereunder are solely to
protect the Administrative Agent’s interests in the Collateral and shall not impose any duty upon the Administrative Agent to exercise any such powers. Except to the extent Section 9207 of the UCC imposes a duty or a duty is otherwise imposed
by applicable law, the Administrative Agent shall have no duty as to any Collateral, including any responsibility for (a) taking any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral or (b)
ascertaining or taking action with respect to calls, conversions, exchanges, maturities, tenders or other matters relative to any Investment Property, whether or not the Administrative Agent has or is deemed to have knowledge of such matters.
Without limiting the generality of the preceding sentence, the Administrative Agent shall be deemed to have exercised reasonable care in the custody and preservation of any of the Collateral if it takes such action for that purpose as any Grantor
reasonably requests in writing at times other than upon the occurrence and during the continuance of any Event of Default. Failure of the Administrative Agent to comply with any such request at any time shall not in itself be deemed a failure to
exercise reasonable care. The Administrative Agent shall be accountable only for amounts that it actually receives as a result of the exercise of such powers and neither it nor any of its officers, directors, employees, agents or representatives
shall be responsible to the Grantors for any act or failure to act, except for its or their own gross negligence or willful misconduct. 
  
 (d) Each Grantor also authorizes the Administrative Agent, at any time and from time to time upon the occurrence and during the continuation of any Event of Default, to (i) communicate in its own name with any party
to any Contract with regard to the assignment of the right, title and interest of any Grantor in and under the Contracts hereunder and other matters relating thereto and (ii) execute, in connection with the sale of Collateral provided for in
Section 7, below, any endorsements, assignments or other instruments of conveyance or transfer with respect to the Collateral. 
  
 (e) If any Grantor fails to perform or comply with any of its agreements contained herein and the Administrative Agent, as provided for by the terms of this Security Agreement, shall perform or comply, or otherwise
cause performance or compliance, with such agreement, the reasonable expenses, including attorneys’ fees and costs, of the Administrative Agent incurred in connection with such performance or compliance, together with interest thereon at a rate
of interest equal to the per annum rate of interest charged on the Advances, shall be payable by the Grantors to the Administrative Agent within five (5) Banking Days of demand and shall constitute Secured Obligations secured hereby. 

 

  
 SECTION 7. Rights and Remedies Upon Event of Default. 

 
 (a) If any Event of Default shall occur and be continuing, the Administrative Agent may exercise, in addition to all
other rights and remedies granted to it under this Security Agreement, the Credit Agreement, the other Loan Documents and under any other instrument or agreement securing, evidencing or relating to the Secured Obligations, all rights and remedies of
a secured party under applicable law, including, without limitation, the UCC. Without limiting the generality of the foregoing, each Grantor expressly agrees that in any such event the Administrative Agent, without demand of performance or other
demand, advertisement or notice of any kind (except the notice specified below of time and place of public or private sale) to or upon the Grantors or any other person (all and each of which demands, advertisements and notices are hereby expressly
waived to the maximum extent not prohibited by the UCC and other applicable law), shall have the right to collect the Proceeds from all Collateral (including, without limitation, dividends or distributions on Pledged Collateral) and may (i) reclaim,
take possession, recover, store, maintain, finish, repair, prepare for sale or lease, ship, advertise for sale or lease and sell or lease (in the manner provided for herein) the Collateral, and in connection with liquidation of the Collateral and
collection of the accounts receivable pledged as Collateral, use any trademark, trade name, trade style, copyright, or process used or owned by any Grantor; (ii) forthwith collect, receive, appropriate and realize upon the Collateral, or any part
thereof, and may forthwith sell, lease, assign, give an option or options to purchase or sell or otherwise dispose of and deliver said Collateral (or contract to do so), or any part thereof, in one or more parcels at public or private sale or sales,
at any exchange or broker’s board or at any of the Administrative Agent’s offices or elsewhere at such prices as it may deem best, for cash or on credit or for future delivery without assumption of any credit risk and (iii) exercise (A)
all voting, consent, corporate and other rights pertaining to the Pledged Collateral at any meeting of shareholders, partners or members, as the case may be, of the relevant issuer or issuers of Pledged Collateral or otherwise and (B) any and all
rights of conversion, exchange and subscription and any other rights, privileges or options pertaining to the Pledged Collateral as if it were the absolute owner thereof (including the right to exchange at its discretion any and all of the Pledged
Collateral upon the merger, consolidation, reorganization, recapitalization or other fundamental change in the corporate structure of any issuer of securities pledged hereunder, the right to deposit and deliver any and all of the Pledged Collateral
with any committee, depositary, transfer agent, registrar or other designated agency upon such terms and conditions as the Administrative Agent may determine), all without liability except to account for property actually received by it, but the
Administrative Agent shall have no duty to any Grantor to exercise any such right, privilege or option and shall not be responsible for any failure to do so or delay in so doing. Each Grantor authorizes the Administrative Agent, on the terms set
forth in this Section 7, to enter the premises where the Collateral is located, to take possession of the Collateral, or any part of it, and to pay, purchase, contest, or compromise any encumbrance, charge, or lien which, in the opinion of
the Administrative Agent, appears to be prior or superior to its security interest. The Administrative Agent shall have the right upon any such public sale or sales, and, to the extent not prohibited by law, upon any such private sale or sales, to
purchase the whole or any part of said Collateral so sold, free of any right or equity of redemption, which equity of redemption each Grantor hereby releases. The Administrative Agent may sell the Collateral without giving any warranties as to the
Collateral and may specifically disclaim any warranties of title, which procedures shall not be considered to adversely affect the commercial reasonableness of any sale of the Collateral. Subject to 

  
 applicable law, each Grantor further agrees, at the Administrative Agent’s request, to assemble the
Collateral and make it available to the Administrative Agent at places which the Administrative Agent shall reasonably select, whether at any Grantor’s premises or elsewhere. The Administrative Agent shall apply the net proceeds of any such
collection, recovery, receipt, appropriation, realization or sale as provided in Section 7(g), below, and Grantors shall remain liable for any deficiency remaining unpaid after such application, and only after so paying over such net proceeds
and after the payment by the Administrative Agent of any other amount required by any provision of law, including Section 9608(a)(1)(C) of the UCC (or any other then applicable provision of the UCC), need the Administrative Agent account for the
surplus, if any, to the Grantors. To the maximum extent not prohibited by applicable law, each Grantor waives all claims, damages, and demands against the Administrative Agent arising out of the repossession, retention or sale of the Collateral
except such as arise out of the gross negligence or willful misconduct of the Administrative Agent. Each Grantor agrees that the Administrative Agent need not give more than ten (10) days’ prior written notice (which notification shall be
deemed given in accordance with the Credit Agreement) of the time and place of any public sale or of the time after which a private sale may take place and that such notice is reasonable notification of such matters. Grantors shall remain liable for
any deficiency if the proceeds of any sale or disposition of the Collateral are insufficient to pay all Secured Obligations, and Grantors shall also be liable for the attorneys’ fees or costs of any attorneys employed by the Administrative
Agent to collect such deficiency. 
  
 (b) As to any Collateral constituting certificated securities or
uncertificated securities, if, at any time when the Administrative Agent shall determine to exercise its right to sell the whole or any part of such Collateral hereunder, such Collateral or the part thereof to be sold shall not, for any reason
whatsoever, be effectively registered under Securities Act of 1933, as amended (as so amended the “Act”), the Administrative Agent may, in its discretion (subject only to applicable requirements of law), sell such Collateral or part
thereof by private sale in such manner and under such circumstances as the Administrative Agent may deem necessary or advisable, but subject to the other requirements of this Section 7(b), and shall not be required to effect such registration
or cause the same to be effected. Without limiting the generality of the foregoing, in any such event the Administrative Agent may, in its sole discretion, (i) in accordance with applicable securities laws, proceed to make such private sale
notwithstanding that a registration statement for the purpose of registering such Collateral or part thereof could be or shall have been filed under the Act; (ii) approach and negotiate with a single possible purchaser to effect such sale; and (iii)
restrict such sale to a purchaser who will represent and agree that such purchaser is purchasing for its own account, for investment, and not with a view to the distribution or sale of such Collateral or part thereof. In addition to a private sale
as provided above in this Section 7(b), if any of such Collateral shall not be freely distributable to the public without registration under the Act at the time of any proposed sale hereunder, then the Administrative Agent shall not be
required to effect such registration or cause the same to be effected but may, in its sole discretion (subject only to applicable requirements of law), require that any sale hereunder (including a sale at auction) be conducted subject to such
restrictions as the Administrative Agent may, in its sole discretion, deem necessary or appropriate in order that such sale (notwithstanding any failure so to register) may be effected in compliance with the Bankruptcy Code and other laws affecting
the enforcement of creditors’ rights and the Act and all applicable state securities laws. In order to permit the Administrative Agent to exercise the voting and other consensual rights which it may be entitled 

 

  
 to exercise pursuant hereto and to receive all dividends and other distributions which it may be
entitled to receive hereunder, (i) each Grantor shall promptly execute and deliver (or cause to be executed and delivered) to the Administrative Agent all such proxies, dividend payment orders and other instruments as the Administrative Agent may
from time to time reasonably request and (ii) without limiting the effect of clause (i) above, such Grantor hereby grants to the Administrative Agent an irrevocable proxy to vote all or any part of the Pledged Collateral and to exercise all
other rights, powers, privileges and remedies to which a holder of the Pledged Collateral would be entitled (including giving or withholding written consents of shareholders, partners or members, as the case may be, calling special meetings of
shareholders, partners or members, as the case may be, and voting at such meetings), which proxy shall be effective, automatically and without the necessity of any action (including any transfer of any Pledged Collateral on the record books of the
issuer thereof) by any other person (including the issuer of such Pledged Collateral or any officer or agent thereof) during the continuance of an Event of Default and which proxy shall terminate upon the earlier of the payment in full of the
Secured Obligations or the cure or waiver of the Event of Default. Each Grantor hereby expressly authorizes and instructs each issuer of any Pledged Collateral pledged hereunder by such Grantor to (i) comply with any instruction received by it from
the Administrative Agent in writing that (A) states that an Event of Default has occurred and is continuing and (B) is otherwise in accordance with the terms of this Agreement, without any other or further instructions from such Grantor, and each
Grantor agrees that such issuer shall be fully protected in so complying and (ii) unless otherwise expressly permitted hereby, pay any dividends or other payments with respect to the Pledged Collateral directly to the Administrative Agent.

  
 (c) Each Grantor agrees that in any sale of any of such Collateral, whether at a foreclosure sale or
otherwise, the Administrative Agent is hereby authorized to comply with any limitation or restriction in connection with such sale as it may be advised by counsel is necessary in order to avoid any violation of applicable law (including compliance
with such procedures as may restrict the number of prospective bidders and purchasers, require that such prospective bidders and purchasers have certain qualifications and restrict such prospective bidders and purchasers to persons who will
represent and agree that they are purchasing for their own account for investment and not with a view to the distribution or resale of such Collateral), or in order to obtain any required approval of the sale or of the purchaser by any governmental
authority, and each Grantor further agrees that such compliance shall not result in such sale being considered or deemed not to have been made in a commercially reasonable manner, nor shall the Administrative Agent be liable nor accountable to any
Grantor for any discount allowed by the reason of the fact that such Collateral is sold in compliance with any such limitation or restriction. 
  
 (d) Each Grantor also agrees to pay all reasonable fees, costs and expenses of the Administrative Agent, including, without limitation, attorneys’ fees and costs, incurred in connection
with the enforcement of any of its rights and remedies hereunder. 
  
 (e) Each Grantor hereby waives
presentment, demand, protest or any notice (to the maximum extent not prohibited by applicable law) of any kind in connection with this Security Agreement or any Collateral. 

  
 (f) Each Grantor agrees that a breach of any covenants contained in this
Section 7 will cause irreparable injury to the Administrative Agent, that in such event the Administrative Agent would have no adequate remedy at law in respect of such breach and, as a consequence, agrees that in such event each and every covenant
contained in this Section 7 shall be specifically enforceable against the Grantors, and each Grantor hereby waives and agrees not to assert any defenses against an action for specific performance of such covenants except for a defense that
the Secured Obligations are not then due and payable. 
  
 (g) The proceeds of any sale, disposition or other
realization upon all or any part of the Collateral shall be distributed by the Administrative Agent in the following order of priorities: 
  
 First, to the Administrative Agent in an amount sufficient to pay in full the costs and expenses of the Administrative Agent in connection with such sale, disposition or other realization,
including all fees, costs, expenses, liabilities and advances incurred or made by the Administrative Agent in connection therewith, including, without limitation, attorneys’ fees and costs; 
  

Second, to the Lenders in an amount equal to accrued interest then due and payable under this Security Agreement and the other Loan Documents;

  
 Third, pari passu and ratably, to (i) the Lenders in an amount equal to the
principal amount of the outstanding Advances and to cash collateralize the remaining Obligations in connection with Letters of Credit on a pro rata basis in accordance with the then outstanding principal amount of the Advances and Obligations in
connection with Letters of Credit (with the portion allocated to the Advances, Swing Line Loans and Obligations in connection with Letters of Credit to be applied first to repay the Swing Line Loans in full, second to repay the remaining Advances in
full and then to cash collateralize the Secured Obligations in an amount equal to the then Aggregate Effective Amount of all Obligations in connection with Letters of Credit) and (ii) to the Lender(s) (as that Term is defined in the Credit
Agreement) or their Affiliates to whom obligations are owed in connection with any Lender Interest Rate Protection Agreements to the extent of the associated Termination Value of such Lender Interest Rate Protection Agreement, and such proceeds will
not be applied to the extent of any excess obligations in connection with any Lender Interest Rate Protection Agreement, until the Secured Obligations (other than obligations under this clause (ii)) have been paid in full and the Commitments have
been terminated; 
  
 Fourth, to the Lenders (as that term is defined in the Credit Agreement)
in an amount equal to any other Secured Obligations (including obligations of the Company under Lender Interest Rate Protection Agreements) which are then unpaid; and 

 

  
 Finally, upon payment in full of all of the Secured
Obligations, to the Persons legally entitled thereto. 
  
                 (h) The Administrative Agent agrees not give any instructions pursuant to a Control Agreement regarding the withdrawal or other
disposition of any funds or investment property in an account that is subject to such Control Agreement unless an Event of Default has occurred and is continuing. 
  
 SECTION 8. Limitation on the Administrative Agent’s Duty in Respect of Collateral. The Administrative Agent shall be deemed to have acted
reasonably in the custody, preservation and disposition of any of the Collateral if it complies with the obligations of a secured party under Section 9207 of the UCC (or any other then applicable successor provision of the UCC). 

 
 SECTION 9. Reinstatement. If this Security Agreement terminates pursuant to its terms or applicable law
and if at any time thereafter payment or performance of the Secured Obligations, or any part thereof, is, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be restored or returned by any obligee of the Secured
Obligations, whether as a result of any proceedings in bankruptcy, reorganization, a “voidable preference,” a “fraudulent conveyance,” or otherwise, then this Security Agreement shall be reinstated and be in full force and effect
all as though such payment or performance had not been made and each Grantor agrees that it will indemnify the Administrative Agent and each Lender on demand for all costs and expenses (including fees and expenses of counsel) incurred by the
Administrative Agent or such Lender in connection with such rescission, restoration or return. In the event that any payment, or any part thereof, is rescinded, reduced, restored or returned, the Secured Obligations shall be reinstated and deemed
reduced only by such amount paid and not so rescinded, reduced, restored or returned. 
  
 SECTION 10.
Miscellaneous. 
  
         10.1
Notices. Except as otherwise specified herein, all notices, requests, demands, consents, instructions or other communications to or upon the Grantors (care of the Company) or the Administrative Agent under this Security Agreement
shall be given as provided in Section 11.6 of the Credit Agreement. 
  
         10.2 Partial Invalidity. If at any time any provision of this Security Agreement is or becomes illegal, invalid or unenforceable in any respect under the law of any
jurisdiction, neither the legality, validity or enforceability of the remaining provisions of this Security Agreement nor the legality, validity or enforceability of such provision under the law of any other jurisdiction shall in any way be affected
or impaired thereby. 
  
         10.3 Headings. The
section headings and captions appearing in this Security Agreement are included solely for convenience of reference and are not intended to affect the interpretation of any provision of this Security Agreement. 

  
         10.4 No Waiver;
Cumulative Remedies. 
  
                 (a) The Administrative Agent shall not by any act, delay, omission or otherwise be deemed to have waived any of its rights or
remedies hereunder or under the Credit Agreement or the other Loan Documents, nor shall any single or partial exercise of any right or remedy hereunder or thereunder on any one or more occasions preclude the further exercise thereof or the exercise
of any other right or remedy under any of the Loan Documents. 
  
                 (b) The rights and remedies hereunder provided or provided under the Credit Agreement or the other Loan Documents are cumulative
and may be exercised singly or concurrently, and are not exclusive of any rights and remedies provided by law or by any of the other Loan Documents. 
  
                 (c) None of the terms or provisions of this Security Agreement may be waived, altered, modified or
amended except by an instrument in writing, duly executed by each Grantor and the Administrative Agent. Unless otherwise specified in any such waiver or consent, a waiver or consent given hereunder shall be effective only in the specific instance
and for the specific purpose for which given. 
  
         10.5
Time is of the Essence. Time is of the essence for the performance of each of the terms and provisions of this Security Agreement. 
  
         10.6 Termination of this Security Agreement. Subject to Section 9, above, this Security Agreement shall terminate upon the full,
complete and final payment of the Secured Obligations and the termination of the Commitments under the Credit Agreement. 
  
         10.7 Successors and Assigns. This Security Agreement and all obligations of the Grantors hereunder shall be binding upon and inure to the benefit of the successors
and assigns of the Grantors, and shall, together with the rights and remedies of the Administrative Agent hereunder, be binding upon and inure to the benefit of the Administrative Agent, the Lenders and their respective successors and assigns;
except that no Grantor may assign or transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent and each Lender. Any assignment or transfer in violation of the foregoing shall be null and void.
The Lenders and the Administrative Agent may disclose this Security Agreement as provided in the Credit Agreement. 
  
         10.8 Further Indemnification. Each Grantor, jointly and severally, agrees to pay, and to save the Administrative Agent harmless from, any and all liabilities with
respect to, or resulting from any delay in paying, any and all excise, sales or other similar taxes which may be payable or determined to be payable with respect to any of the Collateral or in connection with any of the transactions contemplated by
this Security Agreement. 
  
         10.9 Amendments,
Etc. No amendment, modification, supplement, extension, termination or waiver of any provision of this Security Agreement, no approval or consent thereunder, and no consent to any departure by any Grantor therefrom, may in any event be
effective unless in writing signed by the Administrative Agent with the written approval or at the request of the Requisite Lenders, and then only in the specific instance and for the specific purpose given and any such amendment, modification,
supplement, extension, termination or 

 waiver shall be binding upon the Administrative Agent, each holder of Secured Obligations and the Grantors; and, without the approval in writing
of all the Lenders, no amendment, modification, supplement, termination, waiver or consent may be effective as to the matters set forth in the Credit Agreement. 
  
         10.10 ENTIRE AGREEMENT. THIS SECURITY AGREEMENT REPRESENTS THE COMPLETE AND FINAL AGREEMENT AMONG THE GRANTORS AND THE
ADMINISTRATIVE AGENT AND SUPERSEDES ALL PRIOR AGREEMENTS, WRITTEN OR ORAL, ON THE SUBJECT MATTER HEREOF AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF SUCH PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN OR AMONG THE GRANTORS, THE ADMINISTRATIVE AGENT AND THE LENDERS. THE PARTIES HERETO ACKNOWLEDGE THAT CONCURRENTLY WITH THE EXECUTION OF THIS SECURITY AGREEMENT, THE GRANTORS AND THE ADMINISTRATIVE AGENT HAVE ENTERED INTO THAT
CERTAIN SECURITY AGREEMENT (INTELLECTUAL PROPERTY) DATED AS OF EVEN DATE HEREWITH (THE “SECURITY AGREEMENT (INTELLECTUAL PROPERTY)”). THE PARTIES HERETO AGREE THAT IN THE EVENT OF ANY CONFLICTS OR INCONSISTENCIES BETWEEN THE TERMS
AND PROVISIONS OF THIS SECURITY AGREEMENT AND THE TERMS AND PROVISIONS OF THE SECURITY AGREEMENT (INTELLECTUAL PROPERTY) WITH RESPECT TO THE COLLATERAL DESCRIBED IN THE SECURITY AGREEMENT (INTELLECTUAL PROPERTY), THE TERMS AND PROVISIONS OF THE
SECURITY AGREEMENT (INTELLECTUAL PROPERTY) SHALL APPLY AND CONTROL WITH RESPECT TO THE COLLATERAL DESCRIBED IN THE SECURITY AGREEMENT (INTELLECTUAL PROPERTY) TO THE EXTENT OF ANY SUCH CONFLICT OR INCONSISTENCY; PROVIDED THAT NO ASSIGNMENT,
CONVEYANCE, MORTGAGE, PLEDGE, GRANT, HYPOTHECATION OR TRANSFER BY ANY GRANTOR TO THE ADMINISTRATIVE AGENT FOR ITSELF AND FOR THE PRO RATA BENEFIT OF THE LENDERS OF ANY SECURITY INTEREST SHALL BE LIMITED, SUPERCEDED OR OTHERWISE AFFECTED BY THIS
SENTENCE OR ANY OTHER PROVISION OF THE LOAN DOCUMENTS. 
  
         10.11
Governing Law. This Security Agreement shall be governed by, construed and enforced in accordance with, the internal law of the State of California except that matters concerning the validity and perfection of a security interest
shall be governed by the conflict of law rules set forth in the UCC. Each Grantor hereby consents to the application of California civil law to the construction, interpretation and enforcement of this Security Agreement, and to the application of
California civil law to the procedural aspects of any suit, action or proceeding relating thereto, including, but not limited to, legal process, execution of judgments and other legal remedies. 
  

        10.12 Counterparts. This Security Agreement may be executed in any number of identical
counterparts, any set of which signed by all the parties hereto shall be deemed to constitute a complete, executed original for all purposes. Transmission by telecopier of an executed counterpart of this Security Agreement shall be deemed to
constitute due and sufficient delivery of such counterpart. 

  
         10.13 Payments Free
of Taxes, Etc. All payments made by the Grantors under this Security Agreement shall be made by the Grantors free and clear of and without deduction for any and all present and future taxes, levies, charges, deductions and withholdings
(except as otherwise provided in the Credit Agreement). In addition, the Grantors shall pay upon demand any stamp or other taxes, levies or charges of any jurisdiction with respect to the execution, delivery, registration, performance and
enforcement of this Security Agreement. Upon request by the Administrative Agent, the Grantors shall furnish evidence reasonably satisfactory to the Administrative Agent that all requisite authorizations and approvals by, and notices to and filings
with, governmental authorities and regulatory bodies have been obtained and made and that all requisite taxes, levies and charges have been paid. 
  
         10.14 The Grantors’ Continuing Liability. Notwithstanding any provision of this Security Agreement or any other Loan Document
or any exercise by the Administrative Agent of any of its rights hereunder or thereunder (including, without limitation, any right to collect or enforce any Collateral), (i) each Grantor shall remain liable to perform its obligations and duties in
connection with the Collateral and (ii) neither the Administrative Agent nor any Lender shall assume or be considered to have assumed any liability to perform such obligations and duties or to enforce any of the Grantors’ rights in connection
with the Collateral. 
  
         10.15 Additional
Grantors. If, pursuant to the terms and conditions of the Credit Agreement, the Company shall be required to cause any Subsidiary of Parent or Company that is not a Grantor to become a Grantor hereunder, such Subsidiary shall execute and
deliver to the Administrative Agent a Joinder Agreement in the form of Annex 1 and shall thereafter for all purposes be a party hereto and have the same rights, benefits and obligations as a Grantor party hereto on the Closing Date.

  
 [This Space Intentionally Left Blank] 

  
 IN WITNESS WHEREOF, the Grantors and the Administrative Agent have caused this
Security Agreement to be executed as of the day and year first above written. 
  
 
	 WEST MARINE FINANCE COMPANY, INC.,
 a California corporation

	 
	 By:
 	 	 /s/    Russell Solt    
 

	 
	  	 	 Executive Vice President and
 Chief Financial Officer

[Printed Name & Title]
 

 
  
 
	 WEST MARINE, INC.,
 a Delaware corporation
 
	 
	 By:
 	 	 /s/    Russell Solt      
 

	 
	  	 	 Executive Vice President and
 Chief Financial Officer

[Printed Name & Title]
 

 
  
 
	 WEST MARINE PRODUCTS, INC.,
 a California corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	 
	  	 	 Executive Vice President and
 Chief Financial Officer

[Printed Name & Title]
 

 
  
  

 

  
 
	 WEST MARINE PUERTO RICO, INC.,
 a California corporation
 
	 
	 By:
 	 	   /s/    Russell Solt
 

	 
	  	 	 Executive Vice President and
 Chief Financial Officer

[Printed Name & Title]
 

 
  
 
	 W MARINE MANAGEMENT COMPANY, INC.,
 a California corporation

	 
	 By:
 	 	 /s/    Russell Solt      
 

	 
	  	 	 Executive Vice President and
 Chief Financial Officer

[Printed Name & Title]
 

 
  
 
	 WEST MARINE LBC, INC.,
 a California corporation
 
	 
	 By:
 	 	 /s/    Russell Solt
 

	 
	  	 	 Executive Vice President and
 Chief Financial Officer

[Printed Name & Title]
 

 
  
  
  

 

  
 
	 WEST MARINE IHC I, INC.,
 a California corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President and
 Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 E&B MARINE INC.,
 a Delaware corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President and
 Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 E & B MARINE LBC, INC.,
 a California corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President and
 Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 E & B MARINE IHC I, INC.,
 a California corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President and
 Chief Financial Officer
 [Printed Name & Title]
 

 

  
 
	 E & B MARINE SUPPLY, INC.,
 a New Jersey corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President and
 Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 E & B MARINE SUPPLY, INC.,
 a Maryland corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President and
 Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 GOLDBERGS’ MARINE DISTRIBUTORS, INC.,
 a Delaware
corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President and
 Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 JAMES BLISS & CO., INC.,
 a Massachusetts corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President and
 Chief Financial Officer
 [Printed Name & Title]
 

 

  
 
	 SEA RANGER MARINE INC.,
 a Delaware corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President and
 Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 KRISTA CORPORATION,
 a Delaware corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President and
 Chief Financial Officer
 [Printed Name & Title]
 

 
  
  
 
	 CENTRAL MARINE SUPPLY, INC.,
 a New Jersey corporation
 
	 
	 By:
 	 	 /s/    Russell Solt        
 

	  	 	 Executive Vice President and
 Chief Financial Officer
 [Printed Name & Title]
 

 

  
 
	 WELLS FARGO BANK, NATIONAL ASSOCIATION,
 as Administrative Agent

	 
	 By:
 	 	 /s/    Patrick Bishop        
 

	 Name:
 	 	 Patrick Bishop
 
	 Title:
 	 	 Vice President
 

 

 SCHEDULES AND ANNEX 
  
 Schedules 
  
 The schedules listed below have been omitted. A copy of the omitted schedules will be
furnished to the Securities and Exchange Commission upon their request. 
  
 I    -  Collateral for
Perfection by Possession 
 II   -  Letter-of-Credit Rights and Commercial Tort Claims 
 III  -  Deposit Accounts 
 IV  -  Securities Accounts 
 V   -  Legal Name; Jurisdiction of Formation; Books and Records; Location of Collateral 
  
 Annex 1 - Form of Joinder Agreement 

 ANNEX 1 
  
 JOINDER AGREEMENT 
  
 This JOINDER AGREEMENT, dated as of
                ,         , is delivered pursuant to Section 10.15 of the Security Agreement dated as of
January 14, 2003, by West Marine Finance Company, Inc. (the “Company”), and the Subsidiaries of the Company and Parent from time to time party thereto as Grantors in favor of Wells Fargo Bank, National Association, as
administrative agent for the Lenders referred to therein (the “Security Agreement”). Capitalized terms used herein but not defined herein are used herein with the meaning given them in the Security Agreement. 

 
 By executing and delivering this Joinder Agreement, the undersigned, as provided in Section 10.15 of the Security
Agreement, hereby becomes a party to the Security Agreement as a Grantor thereunder with the same force and effect as if originally named as a Grantor therein and, without limiting the generality of the foregoing, as security for the full, prompt,
complete and final payment when due (whether at stated maturity, by acceleration or otherwise) and prompt performance and observance of all the Secured Obligations of the undersigned, the undersigned hereby assigns, conveys, mortgages, pledges,
grants, hypothecates and transfers to the Administrative Agent for itself and for the pro rata benefit of the Lenders, on the terms and subject to the conditions of the Security Agreement, a security interest in and to all of the undersigned’s
right, title and interest in, to and under the Collateral, whether now owned or hereafter acquired by the undersigned or in which the undersigned now holds or hereafter acquires any interest and expressly assumes all obligations and liabilities of a
Grantor thereunder. 
  
 The information set forth in Annex 1-A is hereby added to the information set forth in
Schedules I through V to the Security Agreement. 
  
 The undersigned hereby represents and warrants that each of the
representations and warranties contained in the Security Agreement applicable to it is true and correct on and as the date hereof as if made on and as of such date. 
  
 IN WITNESS WHEREOF, the undersigned has caused this Joinder Agreement to be duly executed and delivered as of the date first above written. 
  
 
	 [ADDITIONAL GRANTOR]
 
	 
	 By:
 	 	 

	  	 	 Name:
 Title:
 

 
  
 ACKNOWLEDGED AND AGREED 
 as of the date of this Joinder Agreement 
 first above written. 
  
 
	 WELLS FARGO BANK, NATIONAL
ASSOCIATION,
 as Administrative Agent
 
	 
	 By:
 	 	 

	 Name:
 	 	  
	 Title:

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