Document:

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                                                                    EXHIBIT 10.5

                               SECURITY AGREEMENT

          THIS SECURITY AGREEMENT ("Agreement") is made as of the 30th day of
September, 2002 by AMX Corporation, a Texas corporation (hereinafter called
"Debtor", whether one or more), in favor of BANK ONE, NA, a national banking
association ("Bank"). Debtor hereby agrees with Bank as follows:

          1.   DEFINITIONS. As used in this Agreement, the following terms shall
have the meanings indicated below:

               (a)    The term "Borrower" shall mean Debtor.

               (b)    The term "Code" shall mean the Uniform Commercial Code as
          in effect in the State of Texas on the date of this Agreement or as it
          may hereafter be amended from time to time.

               (c)    The term "Collateral" shall mean all of the property set
          forth below:

                      (i)     All present and future accounts, chattel paper,
               documents, instruments, deposit accounts and general intangibles
               (including any right to payment for goods sold or services
               rendered arising out of the sale or delivery of personal property
               or work done or labor performed by Debtor), now or hereafter
               owned, held, or acquired by Debtor, together with any and all
               books of account, customer lists and other records relating in
               any way to the foregoing (including, without limitation, computer
               software, whether on tape, disk, card, strip, cartridge or any
               other form), and in any case where an account arises from the
               sale of goods, the interest of Debtor in such goods.

                      (ii)    All present and hereafter acquired inventory
               (including without limitation, all raw materials, work in process
               and finished goods) held, possessed, owned, held on consignment,
               or held for sale, lease, return or to be furnished under
               contracts of services, in whole or in part, by Debtor wherever
               located, all records relating in any way to the foregoing
               (including, without limitation, any computer software, whether on
               tape, disk, card, strip, cartridge or any other form).

                      (iii)   All equipment and fixtures of whatsoever kind and
               character now or hereafter possessed, held, acquired, leased or
               owned by Debtor and used or usable in Debtor's business, together
               with all replacements, accessories, additions, substitutions and
               accessions to all of the foregoing, all records relating in any
               way to the foregoing (including, without limitation, any computer
               software, whether on tape, disk, card, strip, cartridge or any
               other form). To the extent that the foregoing property is located
               on, attached to, annexed to, related to, or used in connection
               with, or otherwise made a part of, and is or shall become
               fixtures upon, real property, such real property and the record
               owner thereof is described on Exhibit "A" attached hereto and
               made a part hereof

                      (iv)    All of Debtor's Intellectual Property.
               "Intellectual Property" means (i) all of Debtor's Copyrights,
               Trademarks, Patents, and Mask Works including amendments,
               renewals, extensions, and all licenses or other rights to use and
               all license fees and royalties from the use thereof; (ii) any
               trade secrets and any intellectual property rights in computer
               software and computer software products now or later existing,
               created, acquired or held; (iii) all design rights which may be
               available to Debtor now or later created, acquired or held; (iv)
               any claims for damages (past, present or future) for

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               infringement of any of the rights above, with the right, but not
               the obligation, to sue and collect damages for use or
               infringement of the intellectual property rights above; and (v)
               all proceeds and products of the foregoing, including all
               insurance, indemnity or warranty payments. "Copyrights" are all
               copyright rights, applications or registrations and like
               protections in each work or authorship or derivative work,
               whether published or not (whether or not it is a trade secret)
               now or later existing, created, acquired or held. "Trademarks"
               are trademark and service mark rights, registered or not,
               applications to register and registrations and like protections,
               and the entire goodwill of the business of Assignor connected
               with the trademarks. "Patents" are patents, patent applications
               and like protections, including improvements, divisions,
               continuations, renewals, reissues, extensions and
               continuations-in-part of the same. "Mask Works" are all mask
               works or similar rights available for the protection of
               semiconductor chips, now owned or later acquired.

               The term Collateral, as used herein, shall also include all
          PRODUCTS and PROCEEDS of all of the foregoing (including without
          limitation, insurance payable by reason of loss or damage to the
          foregoing property) and any property, securities, guaranties or monies
          of Debtor which may at any time come into the possession of Secured
          Party (as hereinafter defined). The designation of proceeds does not
          authorize Debtor to sell, transfer or otherwise convey any of the
          foregoing property except finished goods intended for sale in the
          ordinary course of Debtor's business or as otherwise provided herein.
          The term Collateral does not include any license or contract rights to
          the extent (i) the granting of a security interest in it would be
          contrary to applicable law, or (ii) that such rights are nonassignable
          by their terms (but only to the extent the prohibition is enforceable
          under applicable law, including, without limitation, Section 9.406(d)
          of the Code) without the consent of the licensor or other party (but
          only to the extent such consent has not been obtained).

               (d)  The term "Indebtedness" shall mean (i) all indebtedness,
          obligations and liabilities of Borrower to Secured Party of any kind
          or character, now existing or hereafter arising, whether direct,
          indirect, related, unrelated, fixed, contingent, liquidated,
          unliquidated, joint, several or joint and several, and regardless of
          whether such indebtedness, obligations and liabilities may, prior to
          their acquisition by Secured Party, be or have been payable to or in
          favor of a third party and subsequently acquired by Secured Party (it
          being contemplated that Secured Party may make such acquisitions from
          third parties), including without limitation all indebtedness,
          obligations and liabilities of Borrower to Secured Party now existing
          or hereafter arising by note, draft, acceptance, guaranty,
          endorsement, letter of credit, assignment, purchase, overdraft,
          discount, indemnity agreement or otherwise, (ii) all accrued but
          unpaid interest on any of the indebtedness described in (i) above,
          (iii) all obligations of Borrower to Secured Party under any documents
          evidencing, securing, governing and/or pertaining to all or any part
          of the indebtedness described in (i) and (ii) above, (iv) all costs
          and expenses incurred by Secured Party in connection with the
          collection and administration of all or any part of the indebtedness
          and obligations described in (i), (ii) and (iii) above or the
          protection or preservation of, or realization upon, the collateral
          securing all or any part of such indebtedness and obligations,
          including without limitation all reasonable attorneys' fees, and (v)
          all renewals, extensions, modifications and rearrangements of the
          indebtedness and obligations described in (i), (ii), (iii) and (iv)
          above.

               (e)  The term "Loan Documents" shall mean all instruments and
          documents evidencing, securing, governing, guaranteeing and/or
          pertaining to the Indebtedness.

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               (f)  The term "Obligated Party" shall mean any party other than
          Borrower who secures, guarantees and/or is otherwise obligated to pay
          all or any portion of the Indebtedness.

               (g)  The term "Secured Party" shall mean Bank, its successors and
          assigns, including without limitation, any party to whom Bank, or its
          successors or assigns, may assign its rights and interests under this
          Agreement.

All words and phrases used herein which are expressly defined in Section 1.201
or Chapter 9 of the Code shall have the meaning provided for therein. Other
words and phrases defined elsewhere in the Code shall have the meaning specified
therein except to the extent such meaning is inconsistent with a definition in
Section 1.201 or Chapter 9 of the Code.

          2.   SECURITY INTEREST. As security for the Indebtedness, Debtor, for
value received, hereby grants to Secured Party a continuing security interest in
the Collateral.

          3.   REPRESENTATIONS AND WARRANTIES. Debtor hereby represents and
warrants the following to Secured Party:

               (a)    Due Authorization. The execution, delivery and performance
          of this Agreement and all of the other Loan Documents by Debtor have
          been duly authorized by all necessary corporate action of Debtor, to
          the extent Debtor is a corporation, or by all necessary partnership
          action, to the extent Debtor is a partnership.

               (b)    Enforceability. This Agreement and the other Loan
          Documents constitute legal, valid and binding obligations of Debtor,
          enforceable in accordance with their respective terms, except as
          limited by bankruptcy, insolvency or similar laws of general
          application relating to the enforcement of creditors' rights and
          except to the extent specific remedies may generally be limited by
          equitable principles.

               (c)    Ownership and Liens. Debtor has good and marketable title
          to the Collateral free and clear of all liens, security interests,
          encumbrances or adverse claims, except for the security interest
          created by this Agreement and Permitted Liens. As used herein, the
          term "Permitted Liens" means the following: (i) liens for taxes,
          assessments or other governmental charges or levies not delinquent,
          or, being contested in good faith and with diligence by the Borrower
          and for which Borrower has established and maintains reserves for such
          contested tax, assessment or other governmental charge in accordance
          with GAAP; provided that such lien shall have no effect on the
          priority of the liens in favor of Bank or the value of assets in which
          Bank has such a lien and a stay of enforcement of any such lien shall
          be in effect; (ii) deposits or pledges securing obligations under
          worker's compensation, unemployment insurance, social security or
          public liability laws or similar legislation; (iii) deposits or
          pledges securing bids, tenders, contracts (other than contracts for
          the payment of money), leases, statutory obligations, surety and
          appeal bonds and other obligations of like nature arising in the
          ordinary course of Borrower's business, (iv) judgment liens that have
          been stayed or bonded; (v) mechanics', workers', materialmen's or
          other like liens arising in the ordinary course of Borrower's business
          with respect to obligations which are not due; (vi) purchase money
          liens placed upon fixed assets hereafter acquired to secure a portion
          of the purchase price thereof, provided that any such lien shall not
          encumber any other property of Borrower; and (vii) liens in favor of
          Bank. No dispute, right of setoff, counterclaim or defense exists with
          respect to all or any part of the Collateral included in the Borrowing
          Base (as defined in the Loan Agreement). Debtor has not executed any
          other security agreement currently affecting the Collateral and no
          effective financing statement or other

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          instrument similar in effect covering all or any part of the
          Collateral is on file in any recording office except as may have been
          executed or filed in favor of Secured Party.

               (d)    No Conflicts or Consents. Neither the ownership, the
          intended use of the Collateral by Debtor, the grant of the security
          interest by Debtor to Secured Party herein nor the exercise by Secured
          Party of its rights or remedies hereunder, will (i) conflict with any
          provision of (A) any domestic or foreign law, statute, rule or
          regulation applicable to Debtor or any of its property, (B) the
          articles or certificate of incorporation, charter, bylaws or
          partnership agreement, as the case may be, of Debtor, or (C) any
          agreement, judgment, license, order or permit applicable to or binding
          upon Debtor, or (ii) result in or require the creation of any lien,
          charge or encumbrance upon any assets or properties of Debtor or of
          any person except as may be expressly contemplated in the Loan
          Documents. Except as expressly contemplated in the Loan Documents, no
          consent, approval, authorization or order of, and no notice to or
          filing with, any court, governmental authority or third party is
          required in connection with the grant by Debtor of the security
          interest herein or the exercise by Secured Party of its rights and
          remedies hereunder.

               (e)    Security Interest. Debtor has and will have at all times
          full right, power and authority to grant a security interest in the
          Collateral to Secured Party in the manner provided herein, free and
          clear of any lien, security interest or other charge or encumbrance
          other than Permitted Liens. This Agreement creates a legal, valid and
          binding security interest in favor of Secured Party in the Collateral
          securing the Indebtedness. Possession by Secured Party of all
          certificates, instruments and cash constituting Collateral from time
          to time and/or the filing of the financing statements delivered prior
          hereto and/or concurrently herewith by Debtor to Secured Party will
          perfect and establish the first priority of Secured Party's security
          interest hereunder in the Collateral.

               (f)    Location. Debtor's residence or chief executive office, as
          the case may be, and the office where the records concerning the
          Collateral are kept is located at its address set forth on the
          signature page hereof. Except as specified elsewhere herein, all
          Collateral shall be kept at such address and such other addresses as
          may be listed in Schedule "A" attached hereto and made a part hereof.

               (g)    Solvency of Debtor. As of the date hereof, and after
          giving effect to this Agreement and the completion of all other
          transactions contemplated by Debtor at the time of the execution of
          this Agreement, (i) Debtor is and will be solvent, (ii) the fair
          saleable value of Debtor's assets exceeds and will continue to exceed
          Debtor's liabilities (both fixed and contingent), (iii) Debtor is
          paying and will continue to be able to pay its debts as they mature,
          and (iv) if Debtor is not an individual, Debtor has and will have
          sufficient capital to carry on Debtor's businesses and all businesses
          in which Debtor is about to engage.

               (h)    Compliance with Environmental Laws. Except as disclosed in
          writing to Secured Party: (i) Debtor is conducting Debtor's businesses
          in material compliance with all applicable federal, state and local
          laws, statutes, ordinances, rules, regulations, orders, determinations
          and court decisions, including without limitation, those pertaining to
          health or environmental matters such as the Comprehensive
          Environmental Response, Compensation, and Liability Act of 1980, as
          amended by the Superfund Amendments and Reauthorization Act of 1986
          (collectively, together with any subsequent amendments, hereinafter
          called "CERCLA"), the Resource Conservation and Recovery Act of 1976,
          as amended by the Used Oil Recycling Act of 1980, the Solid Waste
          Disposal Act Amendments of 1980, and the Hazardous Substance Waste
          Amendments of 1984 (collectively, together with any subsequent
          amendments, hereinafter called "RCRA"), the Texas Water Code and the
          Texas Solid Waste Disposal Act; (ii) none of the

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          operations of Debtor is the subject of a federal, state or local
          investigation evaluating whether any material remedial action is
          needed to respond to a release or disposal of any toxic or hazardous
          substance or solid waste into the environment; (iii) Debtor has not
          filed any notice under any federal, state or local law indicating that
          Debtor is responsible for the release into the environment, the
          disposal on any premises in which Debtor is conducting its businesses
          or the improper storage, of any material amount of any toxic or
          hazardous substance or solid waste or that any such toxic or hazardous
          substance or solid waste has been released, disposed of or is
          improperly stored, upon any premise on which Debtor is conducting its
          businesses; and (iv) Debtor otherwise does not have any known material
          contingent liability in connection with the release into the
          environment, disposal or the improper storage, of any such toxic or
          hazardous substance or solid waste. The terms "hazardous substance"
          and "release", as used herein, shall have the meanings specified in
          CERCLA, and the terms "solid waste" and "disposal", as used herein,
          shall have the meanings specified in RCRA; provided, however, that to
          the extent that the laws of the State of Texas establish meanings for
          such terms which are broader than that specified in either CERCLA or
          RCRA, such broader meanings shall apply.

               (i)    Inventory. The security interest in the inventory shall
          continue through all stages of manufacture and shall, without further
          action, attach to the accounts or other proceeds resulting from the
          sale or other disposition thereof and to all such inventory as may be
          returned to Debtor by its account debtors.

               (j)    Accounts. Each account included in the Borrowing Base (as
          defined in the Loan Agreement) represents the valid and legally
          binding indebtedness of a bona fide account debtor arising from the
          sale or lease by Debtor of goods or the rendition by Debtor of
          services and is not subject to contra accounts, setoffs, defenses or
          counterclaims by or available to account debtors obligated on the
          accounts except as disclosed by Debtor to Secured Party from time to
          time in writing except for any such contra accounts, setoffs, defenses
          or counterclaims that could not reasonably be expected to result in a
          material adverse effect on the financial condition of Debtor. The
          amount shown as to each account on Debtor's books is the true and
          undisputed amount owing and unpaid thereon, subject only to discounts,
          allowances, rebates, credits and adjustments to which the account
          debtor has a right and which have been disclosed to Secured Party in
          writing.

               (k)    Chattel Paper, Documents and Instruments. The chattel
          paper, documents and instruments of Debtor pledged hereunder have only
          one original counterpart and no party other than Debtor or Secured
          Party is in actual or constructive possession of any such chattel
          paper, documents or instruments.

          4.   AFFIRMATIVE COVENANTS. Debtor will comply with the covenants
contained in this Section 4 at all times during the period of time this
Agreement is effective unless Secured Party shall otherwise consent in writing.

               (a)    Ownership and Liens. Debtor will maintain good and
          marketable title to all Collateral free and clear of all liens,
          security interests, encumbrances or adverse claims, except for the
          security interest created by this Agreement and the security interests
          and other encumbrances expressly permitted by the other Loan
          Documents. Debtor will not permit any dispute, right of setoff,
          counterclaim or defense to exist with respect to all or any part of
          the Collateral. Debtor will cause any financing statement or other
          security instrument with respect to the Collateral to be terminated,
          except as may exist or as may have been filed in favor of Secured
          Party. Debtor will defend at its expense Secured Party's right, title
          and security interest in and to the Collateral against the claims of
          any third party.

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               (b)    Further Assurances. Debtor will from time to time at its
          expense promptly execute and deliver all further instruments and
          documents and take all further action necessary or appropriate or that
          Secured Party may request in order (i) to perfect and protect the
          security interest created or purported to be created hereby and the
          first priority of such security interest, (ii) to enable Secured Party
          to exercise and enforce its rights and remedies hereunder in respect
          of the Collateral, and (iii) to otherwise effect the purposes of this
          Agreement, including without limitation: (A) executing and filing such
          financing or continuation statements, or amendments thereto; and (B)
          furnishing to Secured Party from time to time statements and schedules
          further identifying and describing the Collateral and such other
          reports in connection with the Collateral, all in reasonable detail
          satisfactory to Bank.

               (c)    Inspection of Collateral. Debtor will keep adequate
          records concerning the Collateral and will permit Secured Party and
          all representatives and agents appointed by Secured Party to inspect
          any of the Collateral and the books and records of or relating to the
          Collateral at any time during normal business hours and upon not less
          than 48 hours advance notice, to make and take away photocopies,
          photographs and printouts thereof and to write down and record any
          such information.

               (d)    Payment of Taxes. Debtor (i) will timely pay all property
          and other taxes, assessments and governmental charges or levies
          imposed upon the Collateral or any part thereof, (ii) will timely pay
          all lawful claims which, if unpaid, might become a lien or charge upon
          the Collateral or any part thereof, and (iii) will maintain
          appropriate accruals and reserves for all such liabilities in a timely
          fashion in accordance with generally accepted accounting principles.
          Debtor may, however, delay paying or discharging any such taxes,
          assessments, charges, claims or liabilities so long as the validity
          thereof is contested in good faith by proper proceedings and provided
          Debtor has set aside on Debtor's books adequate reserves therefor;
          provided, however, Debtor understands and agrees that in the event of
          any such delay in payment or discharge and upon Secured Party's
          written request, Debtor will establish with Secured Party an escrow
          acceptable to Secured Party adequate to cover the payment of such
          taxes, assessments and governmental charges with interest, costs and
          penalties and a reasonable additional sum to cover possible costs,
          interest and penalties (which escrow shall be returned to Debtor upon
          payment of such taxes, assessments, governmental charges, interests,
          costs and penalties or disbursed in accordance with the resolution of
          the contest to the claimant) or furnish Secured Party with an
          indemnity bond secured by a deposit in cash or other security
          acceptable to Secured Party. Notwithstanding any other provision
          contained in this Subsection, Secured Party may at its discretion
          exercise its rights under Subsection 6(c) at any time to pay such
          taxes, assessments, governmental charges, interest, costs and
          penalties.

               (e)    Mortgagee's and Landlord's Waivers. Debtor shall cause
          each mortgagee of real property owned by Debtor and the landlord of
          Debtor's chief executive office to execute and deliver agreements
          satisfactory in form and substance to Secured Party by which such
          mortgagee or landlord waives or subordinates any rights it may have in
          the Collateral.

               (f)    Condition of Goods. Debtor will maintain, preserve,
          protect and keep all Collateral which constitutes goods in good
          condition, repair and working order and will cause such Collateral to
          be used and operated in good and workmanlike manner, in accordance
          with applicable laws and in a manner which will not make void or
          cancelable any insurance with respect to such Collateral. Debtor will
          promptly make or cause to be made all repairs, replacements and other
          improvements to or in connection with the Collateral which Secured
          Party may request from time to time.

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               (g)    Insurance. Debtor will, at its own expense, maintain
          insurance with respect to all Collateral which constitutes goods in
          such amounts, against such risks, in such form and with such insurers,
          as shall be satisfactory to Secured Party from time to time. If
          requested by Secured Party, each policy for property damage insurance
          shall provide for all losses to be paid directly to Secured Party. If
          requested by Secured Party, each policy of insurance maintained by
          Debtor shall (i) name Debtor and Secured Party as insured parties
          thereunder (without any representation or warranty by or obligation
          upon Secured Party) as their interests may appear, (ii) contain the
          agreement by the insurer that any loss thereunder shall be payable to
          Secured Party notwithstanding any action, inaction or breach of
          representation or warranty by Debtor, (iii) provide that there shall
          be no recourse against Secured Party for payment of premiums or other
          amounts with respect thereto, and (iv) provide that at least thirty
          (30) days prior written notice of cancellation or of lapse shall be
          given to Secured Party by the insurer. Debtor will, if requested by
          Secured Party, deliver to Secured Party original or duplicate policies
          of such insurance and, as often as Secured Party may reasonably
          request, a report of a reputable insurance broker with respect to such
          insurance. Debtor will also, at the request of Secured Party, duly
          execute and deliver instruments of assignment of such insurance
          policies and cause the respective insurers to acknowledge notice of
          such assignment. All insurance payments in respect of loss of or
          damage to any Collateral shall be paid to Secured Party and applied as
          Secured Party in its sole discretion deems appropriate.

               (h)    Accounts and General Intangibles. Debtor will, except as
          otherwise provided in Subsection 6(f), collect, at Debtor's own
          expense, all amounts due or to become due under each of the accounts
          and general intangibles. In connection with such collections, Debtor
          may and, at Secured Party's direction, will take such action not
          otherwise forbidden by Subsection 5(e) as Debtor or Secured Party may
          deem necessary or advisable to enforce collection or performance of
          each of the accounts and general intangibles. Debtor will also duly
          perform and cause to be performed all of its obligations with respect
          to the goods or services, the sale or lease or rendition of which gave
          rise or will give rise to each account and all of its obligations to
          be performed under or with respect to the general intangibles. Debtor
          also covenants and agrees to take any action and/or execute any
          documents that Secured Party may request in order to comply with the
          Federal Assignment of Claims Act, as amended.

               (i)    Chattel Paper, Documents and Instruments. Debtor will take
          such action as may be requested by Secured Party in order to cause any
          chattel paper, documents or instruments to be valid and enforceable
          and will cause all chattel paper to have only one original
          counterpart. Upon request by Secured Party, Debtor will deliver to
          Secured Party all originals of chattel paper, documents or instruments
          and will mark all chattel paper with a legend indicating that such
          chattel paper is subject to the security interest granted hereunder.

          5.   NEGATIVE COVENANTS. Debtor will comply with the covenants
contained in this Section 5 at all times during the period of time this
Agreement is effective, unless Secured Party shall otherwise consent in writing.

               (a)    Transfer or Encumbrance. Debtor will not (i) sell, assign
          (by operation of law or otherwise), transfer, exchange, lease or
          otherwise dispose of any of the Collateral, (ii) grant a lien or
          security interest in or execute, file or record any financing
          statement or other security instrument with respect to the Collateral
          to any party other than Secured Party, or (iii) deliver actual or
          constructive possession of any of the Collateral to any party other
          than Secured Party, except for (A) sales and leases of inventory in
          the ordinary course of business, and (B) the sale or other disposal of
          any item of equipment which is worn out or obsolete and which has been
          replaced by an item of equal suitability and value, owned by Debtor
          and made subject to the

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          security interest under this Agreement, but which is otherwise free
          and clear of any lien, security interest, encumbrance or adverse
          claim; provided, however, the exceptions permitted in clauses (A) and
          (B) above shall automatically terminate upon the occurrence of an
          Event of Default.

               (b)    Impairment of Security Interest. Debtor will not take or
          fail to take any action which would in any manner impair the value or
          enforceability of Secured Party's security interest in any Collateral.

               (c)    Possession of Collateral. Debtor will not cause or permit
          the removal of any Collateral from its possession, control and risk of
          loss, nor will Debtor cause or permit the removal of any Collateral
          from the address on the signature page hereof and the addresses
          specified on Schedule "B" to this Agreement other than (i) as
          permitted by Subsection 5(a), or (ii) in connection with the
          possession of any Collateral by Secured Party or by its bailee.

               (d)    Goods. Debtor will not permit any Collateral which
          constitutes goods to at any time (i) be covered by any document except
          documents in the possession of the Secured Party, (ii) become so
          related to, attached to or used in connection with any particular real
          property so as to become a fixture upon such real property, or (iii)
          be installed in or affixed to other goods so as to become an accession
          to such other goods unless such other goods are subject to a perfected
          first priority security interest under this Agreement.

               (e)    Compromise of Collateral. Debtor will not adjust, settle,
          compromise, amend or modify any Collateral, except an adjustment,
          settlement, compromise, amendment or modification in good faith and in
          the ordinary course of business; provided, however, this exception
          shall automatically terminate upon the occurrence of an Event of
          Default or upon Secured Party's written request. Debtor shall provide
          to Secured Party such information concerning (i) any adjustment,
          settlement, compromise, amendment or modification of any Collateral,
          and (ii) any claim asserted by any account debtor for credit,
          allowance, adjustment, dispute, setoff or counterclaim, as Secured
          Party may request from time to time.

               (f)    Financing Statement Filings. Debtor recognizes that
          financing statements pertaining to the Collateral have been or may be
          filed in the State of Texas (Debtor's state of incorporation). Without
          limitation of any other covenant herein, Debtor will not change the
          jurisdiction of its incorporation, unless Debtor shall have notified
          Secured Party in writing of such change at least thirty (30) days
          prior to the effective date of such change, and shall have first taken
          all action required by Secured Party for the purpose of further
          perfecting or protecting the security interest in favor of Secured
          Party in the Collateral. In any written notice furnished pursuant to
          this Subsection, Debtor will expressly state that the notice is
          required by this Agreement and contains facts that may require
          additional filings of financing statements or other notices for the
          purpose of continuing perfection of Secured Party's security interest
          in the Collateral.

          6.   RIGHTS OF SECURED PARTY. Secured Party shall have the rights
contained in this Section 6 at all times (except as otherwise specified) during
the period of time this Agreement is effective.

               (a)    Additional Financing Statements Filings. Debtor hereby
          authorizes Secured Party to file, without the signature of Debtor, one
          or more financing or continuation statements, and amendments thereto,
          relating to the Collateral. Debtor further agrees that a carbon,
          photographic or other reproduction of this Security Agreement or any
          financing statement describing any Collateral is sufficient as a
          financing statement and may be filed in any jurisdiction Secured Party
          may deem appropriate.

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               (b)    Power of Attorney. Debtor hereby irrevocably appoints
          Secured Party as Debtor's attorney-in-fact, such power of attorney
          being coupled with an interest, with full authority in the place and
          stead of Debtor and in the name of Debtor or otherwise, from time to
          time during the continuation of an Event of Default, in Secured
          Party's discretion, to take any action and to execute any instrument
          which Secured Party may deem necessary or appropriate to accomplish
          the purposes of this Agreement, including without limitation: (i) to
          obtain and adjust insurance required by Secured Party hereunder; (ii)
          to demand, collect, sue for, recover, compound, receive and give
          acquittance and receipts for moneys due and to become due under or in
          respect of the Collateral; (iii) to receive, endorse and collect any
          drafts or other instruments, documents and chattel paper in connection
          with clause (i) or (ii) above; and (iv) to file any claims or take any
          action or institute any proceedings which Secured Party may deem
          necessary or appropriate for the collection and/or preservation of the
          Collateral or otherwise to enforce the rights of Secured Party with
          respect to the Collateral.

               (c)    Performance by Secured Party. If Debtor fails to perform
          any agreement or obligation provided herein, Secured Party may itself
          perform, or cause performance of, such agreement or obligation, and
          the expenses of Secured Party incurred in connection therewith shall
          be a part of the Indebtedness, secured by the Collateral and payable
          by Debtor on demand.

               (d)    Request for Environmental Inspections. Upon Secured
          Party's reasonable request from time to time, Debtor will obtain at
          Debtor's sole expense an inspection or audit of Debtor's operations
          from an engineering or consulting firm approved by Secured Party,
          indicating the presence or absence of toxic or hazardous substances
          and solid wastes on any premises in which Debtor is conducting its
          business; provided, however, Debtor will be obligated to pay for the
          cost of any such inspection or audit no more than one time in any
          twelve (12) month period unless Secured Party has reason to believe
          that toxic or hazardous substances or solid wastes have been dumped on
          any such premises. If Debtor fails to order or obtain an inspection or
          audit within ten (10) days after Secured Party's request, Secured
          Party may at its option order such inspection or audit, and Debtor
          grants to Secured Party and its agents, employees, contractors and
          consultants access to the premises in which it is conducting its
          business and a license (which is coupled with an interest and is
          irrevocable) to obtain inspections and audits. Debtor agrees to
          promptly provide Secured Party with a copy of the results of any such
          inspection or audit received by Debtor. The cost of such inspections
          and audits shall be a part of the Indebtedness, secured by the
          Collateral and payable by Debtor on demand.

               (e)    Debtor's Receipt of Proceeds. All amounts and proceeds
          (including instruments and writings) received by Debtor in respect of
          such accounts or general intangibles shall be received in trust for
          the benefit of Secured Party hereunder and, upon request of Secured
          Party, shall be segregated from other property of Debtor and, during
          the continuance of an Event of Default, shall be forthwith delivered
          to Secured Party in the same form as so received (with any necessary
          endorsement) and applied to the Indebtedness in such manner as Secured
          Party deems appropriate in its sole discretion.

               (f)    Notification of Account Debtors. Secured Party may, during
          the continuance of an Event of Default, at its discretion from time to
          time notify any or all obligors under any accounts or general
          intangibles (i) of Secured Party's security interest in such accounts
          or general intangibles and direct such obligors to make payment of all
          amounts due or to become due to Debtor thereunder directly to Secured
          Party, and (ii) to verify the accounts or general intangibles with
          such obligors. Secured Party shall have the right, during the
          continuance of an Event of Default, at the expense of Debtor, to
          enforce collection of any such accounts or general

                                      - 9 -

<PAGE>

          intangibles and to adjust, settle or compromise the amount or payment
          thereof, in the same manner and to the same extent as Debtor.

          7.   EVENTS OF DEFAULT. Each of the following constitutes an "Event of
Default" under this Agreement:

               (a)    Failure to Pay Indebtedness. The failure, refusal or
          neglect of Borrower to make any payment of principal or interest on
          the Indebtedness, or any portion thereof, as the same shall become due
          and payable, and the continuation of such failure, refusal or neglect
          for ten (10) days; or

               (b)    Non-Performance of Covenants. The failure of Borrower or
          any Obligated Party to timely and properly observe, keep or perform
          any covenant, agreement, warranty or condition required herein or in
          any of the other Loan Documents and the continuation of such failure
          for thirty (30) days (other than the covenants contained in Sections
          8, 9 or Addendum 1 of the Loan Agreement, for which there is no grace
          period); or

               (c)    Default Under other Loan Documents. The occurrence of an
          event of default hereunder or under any of the other Loan Documents;
          or

               (d)    False Representation. Any representation contained herein
          or in any of the other Loan Documents made by Borrower or any
          Obligated Party is false or misleading in any material respect; or

               (e)    Default to Third Party. The occurrence of any event which
          permits the acceleration of the maturity of any indebtedness in excess
          of $100,000.00 owing by Borrower or any Obligated Party to any third
          party under any agreement or undertaking; or

               (f)    Bankruptcy or Insolvency. If Borrower or any Obligated
          Party: (i) becomes insolvent, or makes a transfer in fraud of
          creditors, or makes an assignment for the benefit of creditors, or
          admits in writing its inability to pay its debts as they become due;
          (ii) generally is not paying its debts as such debts become due; (iii)
          has a receiver, trustee or custodian appointed for, or take possession
          of, all or substantially all of the assets of such party or any of the
          Collateral, either in a proceeding brought by such party or in a
          proceeding brought against such party and such appointment is not
          discharged or such possession is not terminated within sixty (60) days
          after the effective date thereof or such party consents to or
          acquiesces in such appointment or possession; or (iv) files a petition
          for relief under the United States Bankruptcy Code or any other
          present or future federal or state insolvency, bankruptcy or similar
          laws (all of the foregoing hereinafter collectively called "Applicable
          Bankruptcy Law") or an involuntary petition for relief is filed
          against such party under any Applicable Bankruptcy Law and such
          involuntary petition is not dismissed within sixty (60) days after the
          filing thereof, or an order for relief naming such party is entered
          under any Applicable Bankruptcy Law, or any composition,
          rearrangement, extension, reorganization or other relief of debtors
          now or hereafter existing is requested or consented to by such party;
          or

               (g)    Execution on Collateral. The Collateral or any portion
          thereof is taken on execution or other process of law in any action
          against Debtor; provided that it shall not be an Event of Default
          hereunder for a period of thirty (30) days following such taking
          (during which time Bank may, in its sole and absolute discretion,
          elect to waive the operation of this section with respect to such
          taking); or

                                     - 10 -

<PAGE>

               (h)    Abandonment. Debtor abandons the Collateral or any portion
          thereof; or

               (i)    Action by Other Lienholder. The holder of any lien or
          security interest on any of the assets of Debtor, including without
          limitation, the Collateral (without hereby implying the consent of
          Secured Party to the existence or creation of any such lien or
          security interest on the Collateral), declares a default thereunder or
          institutes foreclosure or other proceedings for the enforcement of its
          remedies thereunder and the failure of such holder to revoke such
          declaration or cease such foreclosure or other proceedings within 20
          days thereafter; or

               (j)    Liquidation, Death and Related Events. If Borrower or any
          Obligated Party is an entity, the liquidation, dissolution, merger or
          consolidation of any such entity or, if Borrower or any Obligated
          Party is an individual, the death or legal incapacity of any such
          individual; or

               (g)    The entry of any judgment against Borrower or the issuance
          or entry of any attachment or other lien against any of the property
          of Borrower for an amount in excess of $250,000.00, if undischarged,
          unbonded or undismissed within thirty (30) days after such entry.

          8.    REMEDIES AND RELATED RIGHTS. If an Event of Default shall have
occurred and is continuing, and without limiting any other rights and remedies
provided herein, under any of the other Loan Documents or otherwise available to
Secured Party, Secured Party may exercise one or more of the rights and remedies
provided in this Section.

               (a)    Remedies. Secured Party may from time to time at its
          discretion, without limitation and without notice except as expressly
          provided in any of the Loan Documents:

                      (i)     exercise in respect of the Collateral all the
               rights and remedies of a secured party under the Code (whether or
               not the Code applies to the affected Collateral);

                      (ii)    require Debtor to, and Debtor hereby agrees that
               it will at its expense and upon request of Secured Party,
               assemble the Collateral as directed by Secured Party and make it
               available to Secured Party at a place to be designated by Secured
               Party which is reasonably convenient to both parties;

                      (iii)   reduce its claim to judgment or foreclose or
               otherwise enforce, in whole or in part, the security interest
               granted hereunder by any available judicial procedure;

                      (iv)    sell or otherwise dispose of, at its office, on
               the premises of Debtor or elsewhere, the Collateral, as a unit or
               in parcels, by public or private proceedings, and by way of one
               or more contracts (it being agreed that the sale or other
               disposition of any part of the Collateral shall not exhaust
               Secured Party's power of sale, but sales or other dispositions
               may be made from time to time until all of the Collateral has
               been sold or disposed of or until the Indebtedness has been paid
               and performed in full), and at any such sale or other disposition
               it shall not be necessary to exhibit any of the Collateral;

                      (v)     buy the Collateral, or any portion thereof, at any
               public disposition;

                                     - 11 -

<PAGE>

                      (vi)    buy the Collateral, or any portion thereof, at
               any private disposition if the Collateral is of a type
               customarily sold in a recognized market or is of a type which is
               the subject of widely distributed standard price quotations;

                      (vii)   apply for the appointment of a receiver for the
               Collateral, and Debtor hereby consents to any such appointment;
               and

                      (viii)  at its option, retain the Collateral in
               satisfaction of the Indebtedness whenever the circumstances are
               such that Secured Party is entitled to do so under the Code or
               otherwise.

          Debtor agrees that in the event Debtor is entitled to receive any
          notice under the Uniform Commercial Code, as it exists in the state
          governing any such notice, of the sale or other disposition of any
          Collateral, reasonable notice shall be deemed given when such notice
          is deposited in a depository receptacle under the care and custody of
          the United States Postal Service, postage prepaid, at Debtor's address
          set forth on the signature page hereof, ten (10) days prior to the
          date of any public disposition, or after which a private disposition,
          of any of such Collateral is to be held. Secured Party shall not be
          obligated to make any disposition of Collateral regardless of notice
          of disposition having been given. Secured Party may adjourn any public
          or private disposition from time to time by announcement at the time
          and place fixed therefor, and such disposition may, without further
          notice, be made at the time and place to which it was so adjourned.

               (b)    Application of Proceeds. If any Event of Default shall
          have occurred and is continuing, Secured Party may at its discretion
          apply or use any cash held by Secured Party as Collateral, and any
          cash proceeds received by Secured Party in respect of any sale or
          other disposition of, collection from, or other realization upon, all
          or any part of the Collateral as follows in such order and manner as
          Secured Party may elect:

                      (i)     to the repayment or reimbursement of the
               reasonable costs and expenses (including, without limitation,
               reasonable attorneys' fees and expenses) incurred by Secured
               Party in connection with (A) the administration of the Loan
               Documents, (B) the custody, preservation, use or operation of, or
               the sale or other disposition of, collection from, or other
               realization upon, the Collateral, and (C) the exercise or
               enforcement of any of the rights and remedies of Secured Party
               hereunder;

                      (ii)    to the payment or other satisfaction of any liens
               and other encumbrances upon the Collateral;

                      (iii)   to the satisfaction of the Indebtedness;

                      (iv)    by holding such cash and proceeds as Collateral;

                      (v)     to the payment of any other amounts required by
               applicable law (including without limitation, Section 9.615 of
               the Code or any other applicable statutory provision); and

                      (vi)    by delivery to Debtor or any other party
               lawfully entitled to receive such cash or proceeds whether by
               direction of a court of competent jurisdiction or otherwise.

                                     - 12 -

<PAGE>

               (c)    Deficiency. In the event that the proceeds of any sale or
          other disposition of, collection from, or other realization upon, all
          or any part of the Collateral by Secured Party are insufficient to pay
          all amounts to which Secured Party is legally entitled, Borrower and
          any party who guaranteed or is otherwise obligated to pay all or any
          portion of the Indebtedness shall be liable for the deficiency,
          together with interest thereon as provided in the Loan Documents.

               (d)    Non-Judicial Remedies. In granting to Secured Party the
          power to enforce its rights hereunder without prior judicial process
          or judicial hearing, Debtor expressly waives, renounces and knowingly
          relinquishes any legal right which might otherwise require Secured
          Party to enforce its rights by judicial process. Debtor recognizes and
          concedes that non-judicial remedies are consistent with the usage of
          trade, are responsive to commercial necessity and are the result of a
          bargain at arm's length. Nothing herein is intended to prevent Secured
          Party or Debtor from resorting to judicial process at either party's
          option.

               (e)    Other Recourse. Debtor waives any right to require Secured
          Party to proceed against any third party, exhaust any Collateral or
          other security for the Indebtedness, or to have any third party joined
          with Debtor in any suit arising out of the Indebtedness or any of the
          Loan Documents, or pursue any other remedy available to Secured Party.
          Debtor further waives any and all notice of acceptance of this
          Agreement and of the creation, modification, rearrangement, renewal or
          extension of the Indebtedness. Debtor further waives any defense
          arising by reason of any disability or other defense of any third
          party or by reason of the cessation from any cause whatsoever of the
          liability of any third party. Until all of the Indebtedness shall have
          been paid in full, Debtor shall have no right of subrogation and
          Debtor waives the right to enforce any remedy which Secured Party has
          or may hereafter have against any third party, and waives any benefit
          of and any right to participate in any other security whatsoever now
          or hereafter held by Secured Party. Debtor authorizes Secured Party,
          and without notice or demand and without any reservation of rights
          against Debtor and without affecting Debtor's liability hereunder or
          on the Indebtedness to (i) take or hold any other property of any type
          from any third party as security for the Indebtedness, and exchange,
          enforce, waive and release any or all of such other property, (ii)
          apply such other property and direct the order or manner of sale or
          other disposition thereof as Secured Party may in its discretion
          determine, (iii) renew, extend, accelerate, modify, compromise, settle
          or release any of the Indebtedness or other security for the
          Indebtedness, (iv) waive, enforce or modify any of the provisions of
          any of the Loan Documents executed by any third party, and (v) release
          or substitute any third party.

          9.   INDEMNITY. Debtor hereby indemnifies and agrees to hold harmless
Secured Party, and its officers, directors, employees, agents and
representatives (each an "Indemnified Person") from and against any and all
liabilities, obligations, claims, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
(collectively, the "Claims") which may be imposed on, incurred by, or asserted
against, any Indemnified Person arising in connection with the Loan Documents,
the Indebtedness or the Collateral (including without limitation, the
enforcement of the Loan Documents and the defense of any Indemnified Person's
actions and/or inactions in connection with the Loan Documents). WITHOUT
LIMITATION, THE FOREGOING INDEMNITIES SHALL APPLY TO EACH INDEMNIFIED PERSON
WITH RESPECT TO ANY CLAIMS WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT
OF THE NEGLIGENCE (WHETHER SOLE, COMPARATIVE OR CONTRIBUTORY) OF SUCH AND/OR ANY
OTHER INDEMNIFIED PERSON, OR FOR WHICH SUCH OR ANY OTHER INDEMNIFIED PERSON
MIGHT OTHERWISE BE LIABLE (BY VIRTUE OF STRICT LIABILITY OR OTHERWISE), except
to the limited extent the Claims against an Indemnified Person are proximately
caused by such Indemnified Person's gross negligence or willful misconduct. If
Debtor or any third party ever alleges such gross negligence or willful
misconduct by any Indemnified Person, the indemnification provided for

                                     - 13 -

<PAGE>

in this Section shall nonetheless be paid upon demand, subject to later
adjustment or reimbursement, until such time as a court of competent
jurisdiction enters a final judgment as to the extent and effect of the alleged
gross negligence or willful misconduct. The indemnification provided for in this
Section shall survive the termination of this Agreement and shall extend and
continue to benefit each individual or entity who is or has at any time been an
Indemnified Person hereunder.

          10.  MISCELLANEOUS.

               (a)    Entire Agreement. This Agreement and the Intellectual
          Property Security Agreement executed in connection herewith contain
          the entire agreement of Secured Party and Debtor with respect to the
          Collateral. If the parties hereto are parties to any prior agreement,
          either written or oral, relating to the Collateral, the terms of this
          Agreement and the Intellectual Property Security Agreement shall amend
          and supersede the terms of such prior agreements as to transactions on
          or after the effective date of this Agreement, but all security
          agreements, financing statements, guaranties, other contracts and
          notices for the benefit of Secured Party shall continue in full force
          and effect to secure the Indebtedness unless Secured Party
          specifically releases its rights thereunder by separate release.

               (b)    Amendment. No modification, consent or amendment of any
          provision of this Agreement or any of the other Loan Documents shall
          be valid or effective unless the same is in writing and signed by the
          party against whom it is sought to be enforced.

               (c)    Actions by Secured Party. The lien, security interest and
          other security rights of Secured Party hereunder shall not be impaired
          by (i) any renewal, extension, increase or modification with respect
          to the Indebtedness, (ii) any surrender, compromise, release, renewal,
          extension, exchange or substitution which Secured Party may grant with
          respect to the Collateral, or (iii) any release or indulgence granted
          to any endorser, guarantor or surety of the Indebtedness. The taking
          of additional security by Secured Party shall not release or impair
          the lien, security interest or other security rights of Secured Party
          hereunder or affect the obligations of Debtor hereunder.

               (d)    Waiver by Secured Party. Secured Party may waive any Event
          of Default without waiving any other prior or subsequent Event of
          Default. Secured Party may remedy any default without waiving the
          Event of Default remedied. Neither the failure by Secured Party to
          exercise, nor the delay by Secured Party in exercising, any right or
          remedy upon any Event of Default shall be construed as a waiver of
          such Event of Default or as a waiver of the right to exercise any such
          right or remedy at a later date. No single or partial exercise by
          Secured Party of any right or remedy hereunder shall exhaust the same
          or shall preclude any other or further exercise thereof, and every
          such right or remedy hereunder may be exercised at any time. No waiver
          of any provision hereof or consent to any departure by Debtor
          therefrom shall be effective unless the same shall be in writing and
          signed by Secured Party and then such waiver or consent shall be
          effective only in the specific instances, for the purpose for which
          given and to the extent therein specified. No notice to or demand on
          Debtor in any case shall of itself entitle Debtor to any other or
          further notice or demand in similar or other circumstances.

               (e)    Costs and Expenses. Debtor will upon demand pay to Secured
          Party the amount of any and all costs and expenses (including without
          limitation, attorneys' fees and expenses), which Secured Party may
          incur in connection with (i) the transactions which give rise to the
          Loan Documents, (ii) the preparation of this Agreement and the
          perfection and preservation of the security interests granted under
          the Loan Documents, (iii) the administration of the Loan Documents,
          (iv) the custody, preservation, use or operation of, or the sale or
          other disposition of,

                                     - 14 -

<PAGE>

          collection from, or other realization upon, the Collateral, (v) the
          exercise or enforcement of any of the rights of Secured Party under
          the Loan Documents, or (vi) the failure by Debtor to perform or
          observe any of the provisions hereof.

               (f)    GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
          CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND
          APPLICABLE FEDERAL LAWS, EXCEPT TO THE EXTENT PERFECTION AND THE
          EFFECT OF PERFECTION OR NON-PERFECTION OF THE SECURITY INTEREST
          GRANTED HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL, ARE
          GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF TEXAS.

               (g)    Venue. This Agreement has been entered into in the county
          in Texas where Bank's address for notice purposes is located, and it
          shall be performable for all purposes in such county. Courts within
          the State of Texas shall have jurisdiction over any and all disputes
          arising under or pertaining to this Agreement and venue for any such
          disputes shall be in the county or judicial district where this
          Agreement has been executed and delivered.

               (h)    Severability. If any provision of this Agreement is held
          by a court of competent jurisdiction to be illegal, invalid or
          unenforceable under present or future laws, such provision shall be
          fully severable, shall not impair or invalidate the remainder of this
          Agreement and the effect thereof shall be confined to the provision
          held to be illegal, invalid or unenforceable.

               (i)    No Obligation. Nothing contained herein shall be construed
          as an obligation on the part of Secured Party to extend or continue to
          extend credit to Borrower.

               (j)    Notices. All notices, requests, demands or other
          communications required or permitted to be given pursuant to this
          Agreement shall be in writing and given by (i) personal delivery, (ii)
          expedited delivery service with proof of delivery, or (iii) United
          States mail, postage prepaid, registered or certified mail, return
          receipt requested, sent to the intended addressee at the address set
          forth on the signature page hereof or to such different address as the
          addressee shall have designated by written notice sent pursuant to the
          terms hereof and shall be deemed to have been received either, in the
          case of personal delivery, at the time of personal delivery, in the
          case of expedited delivery service, as of the date of first attempted
          delivery at the address and in the manner provided herein, or in the
          case of mail, two (2) business days after deposit in a depository
          receptacle under the care and custody of the United States Postal
          Service. Either party shall have the right to change its address for
          notice hereunder to any other location within the continental United
          States by notice to the other party of such new address at least
          thirty (30) days prior to the effective date of such new address.

               (k)    Binding Effect and Assignment. This Agreement (i) creates
          a continuing security interest in the Collateral, (ii) shall be
          binding on Debtor and the heirs, executors, administrators, personal
          representatives, successors and assigns of Debtor, and (iii) shall
          inure to the benefit of Secured Party and its successors and assigns.
          Without limiting the generality of the foregoing, Secured Party may
          pledge, assign or otherwise transfer the Indebtedness and its rights
          under this Agreement and any of the other Loan Documents to any other
          party. Debtor's rights and obligations hereunder may not be assigned
          or otherwise transferred without the prior written consent of Secured
          Party.

               (l)    Termination. It is contemplated by the parties hereto that
          from time to time there may be no outstanding Indebtedness, but
          notwithstanding such occurrences, this Agreement shall

                                     - 15 -

<PAGE>

          remain valid and shall be in full force and effect as to subsequent
          outstanding Indebtedness. Upon (i) the satisfaction in full of the
          Indebtedness, (ii) the termination or expiration of any commitment of
          Secured Party to extend credit to Borrower, (iii) written request for
          the termination hereof delivered by Debtor to Secured Party, and (iv)
          written release or termination delivered by Secured Party to Debtor,
          this Agreement and the security interests created hereby shall
          terminate. Upon termination of this Agreement and Debtor's written
          request, Secured Party will, at Debtor's sole cost and expense, return
          to Debtor such of the Collateral as shall not have been sold or
          otherwise disposed of or applied pursuant to the terms hereof and
          execute and deliver to Debtor such documents as Debtor shall
          reasonably request to evidence such termination.

               (m)    Cumulative Rights. All rights and remedies of Secured
          Party hereunder are cumulative of each other and of every other right
          or remedy which Secured Party may otherwise have at law or in equity
          or under any of the other Loan Documents, and the exercise of one or
          more of such rights or remedies shall not prejudice or impair the
          concurrent or subsequent exercise of any other rights or remedies.

               (n)    Gender and Number. Within this Agreement, words of any
          gender shall be held and construed to include the other gender, and
          words in the singular number shall be held and construed to include
          the plural and words in the plural number shall be held and construed
          to include the singular, unless in each instance the context requires
          otherwise.

               (o)    Descriptive Headings. The headings in this Agreement are
          for convenience only and shall in no way enlarge, limit or define the
          scope or meaning of the various and several provisions hereof.

                                     - 16 -

<PAGE>

          EXECUTED as of the date first written above.

Debtor's Address:                          DEBTOR:

AMX Corporation                            AMX Corporation, a Texas corporation
3000 Research Drive
Richardson, Texas                          By: /s/ Jean M. Nelson
Attn: Jean Nelson                             ----------------------------------
                                           Name: Jean M. Nelson
                                                --------------------------------
                                           Title: VP & CFO
                                                 -------------------------------

Secured Party's Address:

Bank One, NA
1717 Main Street, 3rd Floor
Dallas, Texas  75201
Attn: Middle Market Banking Group (Fred Points)

                                     - 17 -

<PAGE>

                                  SCHEDULE "A"
                                       TO
                               SECURITY AGREEMENT
                            DATED SEPTEMBER 30, 2002
                                 BY AND BETWEEN
                                  BANK ONE, NA
                                       AND
                                 AMX CORPORATION

The other addresses referenced in Subsection 3(f) are as follows:     None.

                                     - 18 -

<PAGE>

                                   EXHIBIT "A"
                                       TO
                               SECURITY AGREEMENT
                            DATED SEPTEMBER 30, 2002
                                 BY AND BETWEEN
                      BANK ONE, TEXAS, NATIONAL ASSOCIATION
                                       AND
                                 AMX CORPORATION

Location:          3000 Research Drive
                   Richardson, Texas  75082

Owner of Record:   DALMAC/GOLDCOR REAL ESTATE VENTURE, LTD.,
                   a Texas limited partnership

Legal Description: 3000 Research Drive
                   Richardson, Texas  75082

                                     - 19 -<PAGE>

                                                                    EXHIBIT 10.6

                                PLEDGE AGREEMENT

          THIS PLEDGE AGREEMENT ("Agreement") is made as of the 30th day of
September, 2002 by AMX Corporation, a Texas corporation (hereinafter called
"Pledgor", whether one or more), in favor of BANK ONE, NA ("Bank"). Pledgor
hereby agrees with Bank as follows:

          1.   DEFINITIONS. As used in this Agreement, the following terms shall
have the meanings indicated below:

               (a)    The term "Borrower" shall mean Pledgor.

               (b)    The term "Code" shall mean the Uniform Commercial Code as
          in effect in the State of Texas on the date of this Agreement or as it
          may hereafter be amended from time to time.

               (c)    The term "Collateral" shall mean all property specifically
          described on Schedule "A" attached hereto and made a part hereof. The
          term Collateral, as used herein, shall also include (i) all
          certificates, instruments and/or other documents evidencing the
          foregoing, (ii) all renewals, replacements and substitutions of all of
          the foregoing, (iii) all Additional Property (as hereinafter defined),
          and (iv) all PRODUCTS and PROCEEDS of all of the foregoing. The
          designation of proceeds does not authorize Pledgor to sell, transfer
          or otherwise convey any of the foregoing property. The delivery at any
          time by Pledgor to Secured Party of any property as a pledge to secure
          payment or performance of any indebtedness or obligation whatsoever
          shall also constitute a pledge of such property as Collateral
          hereunder.

               (d)    The term "Indebtedness" shall mean (i) all indebtedness,
          obligations and liabilities of Borrower to Secured Party of any kind
          or character, now existing or hereafter arising, whether direct,
          indirect, related, unrelated, fixed, contingent, liquidated,
          unliquidated, joint, several or joint and several, and regardless of
          whether such indebtedness, obligations and liabilities may, prior to
          their acquisition by Secured Party, be or have been payable to or in
          favor of a third party and subsequently acquired by Secured Party (it
          being contemplated that Secured Party may make such acquisitions from
          third parties), including without limitation all indebtedness,
          obligations and liabilities of Borrower to Secured Party now existing
          or hereafter arising by note, draft, acceptance, guaranty,
          endorsement, letter of credit, assignment, purchase, overdraft,
          discount, indemnity agreement or otherwise, (ii) all accrued but
          unpaid interest on any of the indebtedness described in (i) above,
          (iii) all obligations of Borrower to Secured Party under any documents
          evidencing, securing, governing and/or pertaining to all or any part
          of the indebtedness described in (i) and (ii) above, (iv) all costs
          and expenses incurred by Secured Party in connection with the
          collection and administration of all or any part of the indebtedness
          and obligations described in (i), (ii) and (iii) above or the
          protection or preservation of, or realization upon, the collateral
          securing all or any part of such indebtedness and obligations,
          including without limitation all reasonable attorneys' fees, and (v)
          all renewals, extensions, modifications and rearrangements of the
          indebtedness and obligations described in (i), (ii), (iii) and (iv)
          above.

               (e)    The term "Loan Documents" shall mean all instruments and
          documents evidencing, securing, governing, guaranteeing and/or
          pertaining to the Indebtedness.

               (f)    The term "Obligated Party" shall mean any party other than
          Borrower who secures, guarantees and/or is otherwise obligated to pay
          all or any portion of the Indebtedness.

<PAGE>

               (g)    The term "Secured Party" shall mean Bank, its successors
          and assigns, including without limitation, any party to whom Bank, or
          its successors or assigns, may assign its rights and interests under
          this Agreement.

All words and phrases used herein which are expressly defined in Section 1.201,
Chapter 8 or Chapter 9 of the Code shall have the meaning provided for therein.
Other words and phrases defined elsewhere in the Code shall have the meaning
specified therein except to the extent such meaning is inconsistent with a
definition in Section 1.201, Chapter 8 or Chapter 9 of the Code.

          2.   SECURITY INTEREST. As security for the Indebtedness, Pledgor, for
value received, hereby grants to Secured Party a continuing security interest in
the Collateral.

          3.   ADDITIONAL PROPERTY. Collateral shall also include the following
property (collectively, the "Additional Property") which Pledgor becomes
entitled to receive or shall receive in connection with any other Collateral:
(a) any stock certificate, including without limitation, any certificate
representing a stock dividend or any certificate in connection with any
recapitalization, reclassification, merger, consolidation, conversion, sale of
assets, combination of shares, stock split or spin-off; (b) any option, warrant,
subscription or right, whether as an addition to or in substitution of any other
Collateral; (c) any dividends or distributions of any kind whatsoever, whether
distributable in cash, stock or other property; (d) any interest, premium or
principal payments; and (e) any conversion or redemption proceeds; provided,
however, that until the occurrence of an Event of Default (as hereinafter
defined), Pledgor shall be entitled to all cash dividends and all interest paid
on the Collateral (except interest paid on any certificate of deposit pledged
hereunder) free of the security interest created under this Agreement. All
Additional Property received by Pledgor shall be received in trust for the
benefit of Secured Party. All Additional Property and all certificates or other
written instruments or documents evidencing and/or representing the Additional
Property that is received by Pledgor, together with such instruments of transfer
as Secured Party may request, shall immediately be delivered to or deposited
with Secured Party and held by Secured Party as Collateral under the terms of
this Agreement. If the Additional Property received by Pledgor shall be shares
of stock or other securities, such shares of stock or other securities shall be
duly endorsed in blank or accompanied by proper instruments of transfer and
assignment duly executed in blank with, if requested by Secured Party,
signatures guaranteed by a member or member organization in good standing of an
authorized Securities Transfer Agents Medallion Program, all in form and
substance satisfactory to Secured Party. Secured Party shall be deemed to have
possession of any Collateral in transit to Secured Party or its agent.

          4.   VOTING RIGHTS. As long as no Event of Default shall have occurred
hereunder, any voting rights incident to any stock or other securities pledged
as Collateral may be exercised by Pledgor; provided, however, that Pledgor will
not exercise, or cause to be exercised, any such voting rights, without the
prior written consent of Secured Party, if the direct or indirect effect of such
vote will result in an Event of Default hereunder.

          5.   MAINTENANCE OF COLLATERAL. Other than the exercise of reasonable
care to assure the safe custody of any Collateral in Secured Party's possession
from time to time, Secured Party does not have any obligation, duty or
responsibility with respect to the Collateral. Without limiting the generality
of the foregoing, Secured Party shall not have any obligation, duty or
responsibility to do any of the following: (a) ascertain any maturities, calls,
conversions, exchanges, offers, tenders or similar matters relating to the
Collateral or informing Pledgor with respect to any such matters; (b) fix,
preserve or exercise any right, privilege or option (whether conversion,
redemption or otherwise) with respect to the Collateral unless (i) Pledgor makes
written demand to Secured Party to do so, (ii) such written demand is received
by Secured Party in sufficient time to permit Secured Party to take the action
demanded in the ordinary course of its business, and (iii) Pledgor provides
additional collateral, acceptable to Secured Party in its

                                      - 2 -

<PAGE>

sole discretion; (c) collect any amounts payable in respect of the Collateral
(Secured Party being liable to account to Pledgor only for what Secured Party
may actually receive or collect thereon); (d) sell all or any portion of the
Collateral to avoid market loss; (e) sell all or any portion of the Collateral
unless and until (i) Pledgor makes written demand upon Secured Party to sell the
Collateral, and (ii) Pledgor provides additional collateral, acceptable to
Secured Party in its sole discretion; or (f) hold the Collateral for or on
behalf of any party other than Pledgor.

          6.   REPRESENTATIONS AND WARRANTIES. Pledgor hereby represents and
warrants the following to Secured Party:

               (a)    Due Authorization. The execution, delivery and performance
          of this Agreement and all of the other Loan Documents by Pledgor have
          been duly authorized by all necessary corporate action of Pledgor, to
          the extent Pledgor is a corporation, or by all necessary partnership
          action, to the extent Pledgor is a partnership.

               (b)    Enforceability. This Agreement and the other Loan
          Documents constitute legal, valid and binding obligations of Pledgor,
          enforceable in accordance with their respective terms, except as
          limited by bankruptcy, insolvency or similar laws of general
          application relating to the enforcement of creditors' rights and
          except to the extent specific remedies may generally be limited by
          equitable principles.

               (c)    Ownership and Liens. Pledgor has good and marketable title
          to the Collateral free and clear of all liens, security interests,
          encumbrances or adverse claims, except for the security interest
          created by this Agreement and other liens expressly permitted by the
          other Loan Documents. No dispute, right of setoff, counterclaim or
          defense exists with respect to all or any part of the Collateral.
          Pledgor has not executed any other security agreement currently
          affecting the Collateral and no financing statement or other
          instrument similar in effect covering all or any part of the
          Collateral is on file in any recording office except as may have been
          executed or filed in favor of Secured Party.

               (d)    No Conflicts or Consents. Neither the ownership, the
          intended use of the Collateral by Pledgor, the grant of the security
          interest by Pledgor to Secured Party herein nor the exercise by
          Secured Party of its rights or remedies hereunder, will (i) conflict
          with any provision of (A) any domestic or foreign law, statute, rule
          or regulation applicable to Pledgor or its property, (B) the articles
          or certificate of incorporation, charter, bylaws or partnership
          agreement, as the case may be, of Pledgor, or (C) any agreement,
          judgment, license, order or permit applicable to or binding upon
          Pledgor or otherwise affecting the Collateral, or (ii) result in or
          require the creation of any lien, charge or encumbrance upon any
          assets or properties of Pledgor or of any person except as may be
          expressly contemplated in the Loan Documents. Except as expressly
          contemplated in the Loan Documents, no consent, approval,
          authorization or order of, and no notice to or filing with, any court,
          governmental authority or third party is required in connection with
          the grant by Pledgor of the security interest herein or the exercise
          by Secured Party of its rights and remedies hereunder.

               (e)    Security Interest. Pledgor has and will have at all times
          full right, power and authority to grant a security interest in the
          Collateral to Secured Party in the manner provided herein, free and
          clear of any lien, security interest or other charge or encumbrance.
          This Agreement creates a legal, valid and binding security interest in
          favor of Secured Party in the Collateral.

                                      - 3 -

<PAGE>

               (f)    Location. Pledgor's residence or chief executive office,
          as the case may be, and the office where the records concerning the
          Collateral are kept is located at its address set forth on the
          signature page hereof.

               (g)    Solvency of Pledgor. As of the date hereof, and after
          giving effect to this Agreement and the completion of all other
          transactions contemplated by Pledgor at the time of the execution of
          this Agreement, (i) Pledgor is and will be solvent, (ii) the fair
          saleable value of Pledgor's assets exceeds and will continue to exceed
          Pledgor's liabilities (both fixed and contingent), (iii) Pledgor is
          paying and will continue to be able to pay its debts as they mature,
          and (iv) if Pledgor is not an individual, Pledgor has and will have
          sufficient capital to carry on Pledgor's businesses and all businesses
          in which Pledgor is about to engage.

               (h)    Securities. Any certificates evidencing securities pledged
          as Collateral are valid and genuine and have not been altered. All
          securities pledged as Collateral have been duly authorized and validly
          issued, are fully paid and non-assessable, and were not issued in
          violation of the preemptive rights of any party or of any agreement by
          which Pledgor or the issuer thereof is bound. No restrictions or
          conditions exist with respect to the transfer or voting of any
          securities pledged as Collateral, except as has been disclosed to
          Secured Party in writing. To the best of Pledgor's knowledge, no
          issuer of such securities (other than securities of a class which are
          publicly traded) has any outstanding stock rights, rights to
          subscribe, options, warrants or convertible securities outstanding or
          any other rights outstanding entitling any party to have issued to
          such party capital stock of such issuer, except as has been disclosed
          to Secured Party in writing.

          7.   AFFIRMATIVE COVENANTS. Pledgor will comply with the covenants
contained in this Section at all times during the period of time this Agreement
is effective unless Secured Party shall otherwise consent in writing.

               (a)    Ownership and Liens. Pledgor will maintain good and
          marketable title to all Collateral free and clear of all liens,
          security interests, encumbrances or adverse claims, except for the
          security interest created by this Agreement and the security interests
          and other encumbrances expressly permitted by the other Loan
          Documents. Pledgor will not permit any dispute, right of setoff,
          counterclaim or defense to exist with respect to all or any part of
          the Collateral. Pledgor will cause any financing statement or other
          security instrument with respect to the Collateral to be terminated,
          except as may exist or as may have been filed in favor of Secured
          Party. Pledgor will defend at its expense Secured Party's right, title
          and security interest in and to the Collateral against the claims of
          any third party.

               (b)    Inspection of Books and Records. Pledgor will keep
          adequate records concerning the Collateral and will permit Secured
          Party and all representatives and agents appointed by Secured Party to
          inspect Pledgor's books and records of or relating to the Collateral
          at any time during normal business hours and upon not less than 48
          hours advance notice, to make and take away photocopies, photographs
          and printouts thereof and to write down and record any such
          information.

               (c)    Adverse Claim. Pledgor covenants and agrees to promptly
          notify Secured Party of any claim, action or proceeding affecting
          title to the Collateral, or any part thereof, or the security interest
          created hereunder and, at Pledgor's expense, defend Secured Party's
          security interest in the Collateral against the claims of any third
          party. Pledgor also covenants and agrees to promptly deliver to
          Secured Party a copy of all written notices received by Pledgor with

                                      - 4 -

<PAGE>

          respect to the Collateral, including without limitation, notices
          received from the issuer of any securities pledged hereunder as
          Collateral.

               (d)    Delivery of Instruments and/or Certificates.
          Contemporaneously herewith, Pledgor covenants and agrees to deliver to
          Secured Party any certificates, documents or instruments representing
          or evidencing the Collateral, with Pledgor's endorsement thereon
          and/or accompanied by proper instruments of transfer and assignment
          duly executed in blank with, if requested by Secured Party, signatures
          guaranteed by a member or member organization in good standing of an
          authorized Securities Transfer Agents Medallion Program, all in form
          and substance satisfactory to Secured Party.

               (e)    Further Assurances. Pledgor will contemporaneously with
          the execution hereof and from time to time thereafter at its expense
          promptly execute and deliver all further instruments and documents and
          take all further action necessary or appropriate or that Secured Party
          may request in order (i) to perfect and protect the security interest
          created or purported to be created hereby and the first priority of
          such security interest, (ii) to enable Secured Party to exercise and
          enforce its rights and remedies hereunder in respect of the
          Collateral, and (iii) to otherwise effect the purposes of this
          Agreement, including without limitation: (A) executing and filing any
          financing or continuation statements, or any amendments thereto; (B)
          obtaining written confirmation from the issuer of any securities
          pledged as Collateral of the pledge of such securities, in form and
          substance satisfactory to Secured Party; (C) cooperating with Secured
          Party in registering the pledge of any securities pledged as
          Collateral with the issuer of such securities; (D) delivering notice
          of Secured Party's security interest in any securities pledged as
          Collateral to any securities or financial intermediary, clearing
          corporation or other party required by Secured Party, in form and
          substance satisfactory to Secured Party; and (E) obtaining written
          confirmation of the pledge of any securities constituting Collateral
          from any securities or financial intermediary, clearing corporation or
          other party required by Secured Party, in form and substance
          satisfactory to Secured Party. If all or any part of the Collateral is
          securities issued by an agency or department of the United States,
          Pledgor covenants and agrees, at Secured Party's request, to cooperate
          in registering such securities in Secured Party's name or with Secured
          Party's account maintained with a Federal Reserve Bank. When
          applicable law provides more than one method of perfection of Secured
          Party's security interest in the Collateral, Secured Party may choose
          the method(s) to be used.

          8.   NEGATIVE COVENANTS. Pledgor will comply with the covenants
contained in this Section at all times during the period of time this Agreement
is effective, unless Secured Party shall otherwise consent in writing.

               (a)    Transfer or Encumbrance. Pledgor will not (i) sell, assign
          (by operation of law or otherwise) or transfer Pledgor's rights in any
          of the Collateral, (ii) grant a lien or security interest in or
          execute, file or record any financing statement or other security
          instrument with respect to the Collateral to any party other than
          Secured Party, or (iii) deliver actual or constructive possession of
          any certificate, instrument or document evidencing and/or representing
          any of the Collateral to any party other than Secured Party.

               (b)    Impairment of Security Interest. Pledgor will not take or
          fail to take any action which would in any manner impair the value or
          enforceability of Secured Party's security interest in any Collateral.

               (c)    Dilution of Ownership. As to any securities pledged as
          Collateral (other than securities of a class which are publicly
          traded), Pledgor will not consent to or approve of the

                                      - 5 -

<PAGE>

          issuance of (i) any additional shares of any class of securities of
          such issuer (unless immediately upon issuance additional securities
          are pledged and delivered to Secured Party pursuant to the terms
          hereof to the extent necessary to give Secured Party a security
          interest after such issuance in at least the same percentage of such
          issuer's outstanding securities as Secured Party had before such
          issuance), (ii) any instrument convertible voluntarily by the holder
          thereof or automatically upon the occurrence or non-occurrence of any
          event or condition into, or exchangeable for, any such securities, or
          (iii) any warrants, options, contracts or other commitments entitling
          any third party to purchase or otherwise acquire any such securities.

               (d)    Restrictions on Securities. Pledgor will not enter into
          any agreement creating, or otherwise permit to exist, any restriction
          or condition upon the transfer, voting or control of any securities
          pledged as Collateral, except as consented to in writing by Secured
          Party.

          9.   RIGHTS OF SECURED PARTY. Secured Party shall have the rights
contained in this Section at all times (except as otherwise specified) during
the period of time this Agreement is effective.

               (a)    Power of Attorney. Pledgor hereby irrevocably appoints
          Secured Party as Pledgor's attorney-in-fact, such power of attorney
          being coupled with an interest, with full authority in the place and
          stead of Pledgor and in the name of Pledgor or otherwise, to take any
          action and to execute any instrument which Secured Party may from time
          to time during the continuance of an Event of Default, in Secured
          Party's discretion deem necessary or appropriate to accomplish the
          purposes of this Agreement, including without limitation, the
          following action: (i) transfer any securities, instruments, documents
          or certificates pledged as Collateral in the name of Secured Party or
          its nominee; (ii) use any interest, premium or principal payments,
          conversion or redemption proceeds or other cash proceeds received in
          connection with any Collateral to reduce any of the Indebtedness;
          (iii) exchange any of the securities pledged as Collateral for any
          other property upon any merger, consolidation, reorganization,
          recapitalization or other readjustment of the issuer thereof, and, in
          connection therewith, to deposit and deliver any and all of such
          securities with any committee, depository, transfer agent, registrar
          or other designated agent upon such terms and conditions as Secured
          Party may deem necessary or appropriate; (iv) exercise or comply with
          any conversion, exchange, redemption, subscription or any other right,
          privilege or option pertaining to any securities pledged as
          Collateral; provided, however, except as provided herein, Secured
          Party shall not have a duty to exercise or comply with any such right,
          privilege or option (whether conversion, redemption or otherwise) and
          shall not be responsible for any delay or failure to do so; and (v)
          file any claims or take any action or institute any proceedings which
          Secured Party may deem necessary or appropriate for the collection
          and/or preservation of the Collateral or otherwise to enforce the
          rights of Secured Party with respect to the Collateral.

               (b)    Performance by Secured Party. If Pledgor fails to perform
          any agreement or obligation provided herein, Secured Party may itself
          perform, or cause performance of, such agreement or obligation, and
          the expenses of Secured Party incurred in connection therewith shall
          be a part of the Indebtedness, secured by the Collateral and payable
          by Pledgor on demand.

Notwithstanding any other provision herein to the contrary, Secured Party does
not have any duty to exercise or continue to exercise any of the foregoing
rights and shall not be responsible for any failure to do so or for any delay in
doing so.

          10.  EVENTS OF DEFAULT. Each of the following constitutes an "Event of
Default" under this Agreement:

                                      - 6 -

<PAGE>

               (a)    Failure to Pay Indebtedness. The failure, refusal or
          neglect of Borrower to make any payment of principal or interest on
          the Indebtedness, or any portion thereof, as the same shall become due
          and payable, and the continuation of such failure, refusal or neglect
          for ten (10) days; or

               (b)    Non-Performance of Covenants. The failure of Borrower or
          any Obligated Party to timely and properly observe, keep or perform
          any covenant, agreement, warranty or condition required herein or in
          any of the other Loan Documents and the continuation of such failure
          for thirty (30) days (other than the covenants contained in Sections
          8, 9 or Addendum 1 of the Loan Agreement, for which there is no grace
          period); or

               (c)    Default Under other Loan Documents. The occurrence of an
          event of default hereunder or under any of the other Loan Documents.

               (d)    False Representation. Any representation contained herein
          or in any of the other Loan Documents made by Borrower or any
          Obligated Party is false or misleading in any material respect; or

               (e)    Default to Third Party. The occurrence of any event which
          permits the acceleration of the maturity of any indebtedness in excess
          of $100,000.00 owing by Borrower or any Obligated Party to any third
          party under any agreement or undertaking; or

               (f)    Bankruptcy or Insolvency. If Borrower or any Obligated
          Party: (i) becomes insolvent, or makes a transfer in fraud of
          creditors, or makes an assignment for the benefit of creditors, or
          admits in writing its inability to pay its debts as they become due;
          (ii) generally is not paying its debts as such debts become due; (iii)
          has a receiver, trustee or custodian appointed for, or take possession
          of, all or substantially all of the assets of such party or any of the
          Collateral, either in a proceeding brought by such party or in a
          proceeding brought against such party and such appointment is not
          discharged or such possession is not terminated within sixty (60) days
          after the effective date thereof or such party consents to or
          acquiesces in such appointment or possession; or (iv) files a petition
          for relief under the United States Bankruptcy Code or any other
          present or future federal or state insolvency, bankruptcy or similar
          laws (all of the foregoing hereinafter collectively called "Applicable
          Bankruptcy Law") or an involuntary petition for relief is filed
          against such party under any Applicable Bankruptcy Law and such
          involuntary petition is not dismissed within sixty (60) days after the
          filing thereof, or an order for relief naming such party is entered
          under any Applicable Bankruptcy Law, or any composition,
          rearrangement, extension, reorganization or other relief of debtors
          now or hereafter existing is requested or consented to by such party;
          or

               (g)    Execution on Collateral. The Collateral or any portion
          thereof is taken on execution or other process of law in any action
          against Pledgor; provided that it shall not be an Event of Default
          hereunder for a period of thirty (30) days following such taking
          (during which time Bank may, in its sole and absolute discretion,
          elect to waive the operation of this section with respect to such
          taking); or

               (h)    Action by Other Lienholder. The holder of any lien or
          security interest on any of the assets of Pledgor, including without
          limitation, the Collateral (without hereby implying the consent of
          Secured Party to the existence or creation of any such lien or
          security interest on the Collateral), declares a default thereunder or
          institutes foreclosure or other proceedings for the enforcement of its
          remedies thereunder and the failure of such holder to revoke such
          declaration or cease such foreclosure or other proceedings within 20
          days thereafter; or

                                      - 7 -

<PAGE>

               (i)    Liquidation, Death and Related Events. If Borrower or any
          Obligated Party is an entity, the liquidation, dissolution, merger or
          consolidation of any such entity or, if Borrower or any Obligated
          Party is an individual, the death or legal incapacity of any such
          individual; or

               (j)    Dilution of Ownership. The issuer of any securities (other
          than securities of a class which are publicly traded) constituting
          Collateral hereafter issues any shares of any class of capital stock
          (unless immediately upon issuance, additional securities are pledged
          and delivered to Secured Party pursuant to the terms hereof to the
          extent necessary to give Secured Party a security interest after such
          issuance in at least the same percentage of such issuer's outstanding
          securities as Secured Party had before such issuance) or any options,
          warrants or other rights to purchase any such capital stock; or

               (k)    Bankruptcy of Issuer. (i) The issuer of any securities
          constituting Collateral files a petition for relief under any
          Applicable Bankruptcy Law, (ii) an involuntary petition for relief is
          filed against any such issuer under any Applicable Bankruptcy Law and
          such involuntary petition is not dismissed within sixty (60) days
          after the filing thereof, or (iii) an order for relief naming any such
          issuer is entered under any Applicable Bankruptcy Law.

               (l)    The entry of any judgment against Borrower or the issuance
          or entry of any attachment or other lien against any of the property
          of Borrower for an amount in excess of $250,000.00, if undischarged,
          unbonded or undismissed within thirty (30) days after such entry.

          11.  REMEDIES AND RELATED RIGHTS. If an Event of Default shall have
occurred and is continuing, and without limiting any other rights and remedies
provided herein, under any of the other Loan Documents or otherwise available to
Secured Party, Secured Party may exercise one or more of the rights and remedies
provided in this Section.

               (a)    Remedies. Secured Party may from time to time at its
          discretion, without limitation and without notice except as expressly
          provided in any of the Loan Documents:

                 (i)   exercise in respect of the Collateral all the rights and
               remedies of a secured party under the Code (whether or not the
               Code applies to the affected Collateral);

                 (ii)  reduce its claim to judgment or foreclose or otherwise
               enforce, in whole or in part, the security interest granted
               hereunder by any available judicial procedure;

                 (iii) sell or otherwise dispose of, at its office, on  the
               premises of Pledgor or elsewhere, the Collateral, as a unit or in
               parcels, by public or private proceedings, and by way of one or
               more contracts (it being agreed that the sale or other
               disposition of any part of the Collateral shall not exhaust
               Secured Party's power of sale, but sales or other dispositions
               may be made from time to time until all of the Collateral has
               been sold or disposed of or until the Indebtedness has been paid
               and performed in full), and at any such sale or other disposition
               it shall not be necessary to exhibit any of the Collateral;

                 (iv)  buy the Collateral, or any portion thereof, at any public
               disposition;

                 (v)   buy the Collateral, or any portion thereof, at any
               private disposition if the Collateral is of a type customarily
               sold in a recognized market or is of a type which is the subject
               of widely distributed standard price quotations;

                                      - 8 -

<PAGE>

                 (vi)  apply for the appointment of a receiver for the
               Collateral, and Pledgor hereby consents to any such appointment;
               and

                 (vii) at its option, retain the Collateral in satisfaction of
               the Indebtedness whenever the circumstances are such that Secured
               Party is entitled to do so under the Code or otherwise.

          Pledgor agrees that in the event Pledgor is entitled to receive any
          notice under the Uniform Commercial Code, as it exists in the state
          governing any such notice, of the sale or other disposition of any
          Collateral, reasonable notice shall be deemed given when such notice
          is deposited in a depository receptacle under the care and custody of
          the United States Postal Service, postage prepaid, at Pledgor's
          address set forth on the signature page hereof, ten (10) days prior to
          the date of any public disposition, or after which a private
          disposition, of any of such Collateral is to be held. Secured Party
          shall not be obligated to make any sale or other disposition of
          Collateral regardless of notice of sale having been given. Secured
          Party may adjourn any public or private disposition from time to time
          by announcement at the time and place fixed therefor, and such sale or
          other disposition may, without further notice, be made at the time and
          place to which it was so adjourned. Pledgor further acknowledges and
          agrees that the redemption by Secured Party of any certificate of
          deposit pledged as Collateral shall be deemed to be a commercially
          reasonable disposition under Section 9.610 of the Code.

               (b)    Private Disposition of Securities. Pledgor recognizes that
          Secured Party may be unable to effect a public sale or other
          disposition of all or any part of the securities pledged as Collateral
          because of restrictions in applicable federal and state securities
          laws and that Secured Party may, therefore, determine to make one or
          more private sales or other dispositions of any such securities to a
          restricted group of purchasers who will be obligated to agree, among
          other things, to acquire such securities for their own account, for
          investment and not with a view to the distribution or resale thereof.
          Pledgor acknowledges that each any such private disposition may be at
          prices and other terms less favorable then what might have been
          obtained at a public disposition and, notwithstanding the foregoing,
          agrees that each such private disposition shall be deemed to have been
          made in a commercially reasonable manner and that Secured Party shall
          have no obligation to delay the sale or other disposition of any such
          securities for the period of time necessary to permit the issuer to
          register such securities for public sale or other disposition under
          any federal or state securities laws. Pledgor further acknowledges and
          agrees that any offer to sell such securities which has been made
          privately in the manner described above to not less than five (5) bona
          fide offerees shall be deemed to involve a "public disposition" for
          the purposes of Section 9.610 of the Code, notwithstanding that such
          sale or other disposition may not constitute a "public offering" under
          any federal or state securities laws and that Secured Party may, in
          such event, bid for the purchase of such securities.

               (c)    Application of Proceeds. If any Event of Default shall
          have occurred and is continuing, Secured Party may at its discretion
          apply or use any cash held by Secured Party as Collateral, and any
          cash proceeds received by Secured Party in respect of any sale or
          other disposition of, collection from, or other realization upon, all
          or any part of the Collateral as follows in such order and manner as
          Secured Party may elect:

                 (i)   to the repayment or reimbursement of the reasonable costs
               and expenses (including, without limitation, reasonable
               attorneys' fees and expenses) incurred by Secured Party in
               connection with (A) the administration of the Loan Documents, (B)
               the custody, preservation, use or operation of, or the sale or
               other disposition of, collection

                                      - 9 -

<PAGE>

               from, or other realization upon, the Collateral, and (C) the
               exercise or enforcement of any of the rights and remedies of
               Secured Party hereunder;

                 (ii)  to the payment or other satisfaction of any liens and
               other encumbrances upon the Collateral;

                 (iii) to the satisfaction of the Indebtedness;

                 (iv)  by holding such cash and proceeds as Collateral;

                 (v)   to the payment of any other amounts required by
               applicable law (including without limitation, Section 9.615 of
               the Code or any other applicable statutory provision); and

                 (vi)  by delivery to Pledgor or any other party lawfully
               entitled to receive such cash or proceeds whether by direction of
               a court of competent jurisdiction or otherwise.

               (d)    Deficiency. In the event that the proceeds of any sale or
          other disposition of, collection from, or other realization upon, all
          or any part of the Collateral by Secured Party are insufficient to pay
          all amounts to which Secured Party is legally entitled, Borrower and
          any party who guaranteed or is otherwise obligated to pay all or any
          portion of the Indebtedness shall be liable for the deficiency,
          together with interest thereon as provided in the Loan Documents.

               (e)    Non-Judicial Remedies. In granting to Secured Party the
          power to enforce its rights hereunder without prior judicial process
          or judicial hearing, Pledgor expressly waives, renounces and knowingly
          relinquishes any legal right which might otherwise require Secured
          Party to enforce its rights by judicial process. Pledgor recognizes
          and concedes that non-judicial remedies are consistent with the usage
          of trade, are responsive to commercial necessity and are the result of
          a bargain at arm's length. Nothing herein is intended to prevent
          Secured Party or Pledgor from resorting to judicial process at either
          party's option.

               (f)    Other Recourse. Pledgor waives any right to require
          Secured Party to proceed against any third party, exhaust any
          Collateral or other security for the Indebtedness, or to have any
          third party joined with Pledgor in any suit arising out of the
          Indebtedness or any of the Loan Documents, or pursue any other remedy
          available to Secured Party. Pledgor further waives any and all notice
          of acceptance of this Agreement and of the creation, modification,
          rearrangement, renewal or extension of the Indebtedness. Pledgor
          further waives any defense arising by reason of any disability or
          other defense of any third party or by reason of the cessation from
          any cause whatsoever of the liability of any third party. Until all of
          the Indebtedness shall have been paid in full, Pledgor shall have no
          right of subrogation and Pledgor waives the right to enforce any
          remedy which Secured Party has or may hereafter have against any third
          party, and waives any benefit of and any right to participate in any
          other security whatsoever now or hereafter held by Secured Party.
          Pledgor authorizes Secured Party, and without notice or demand and
          without any reservation of rights against Pledgor and without
          affecting Pledgor's liability hereunder or on the Indebtedness, to (i)
          take or hold any other property of any type from any third party as
          security for the Indebtedness, and exchange, enforce, waive and
          release any or all of such other property, (ii) apply such other
          property and direct the order or manner of sale or other disposition
          thereof as Secured Party may in its discretion determine, (iii) renew,
          extend, accelerate, modify, compromise, settle or release any of the
          Indebtedness or other security for the Indebtedness, (iv) waive,
          enforce or modify any of the provisions of any of the Loan Documents
          executed by any third party, and (v) release or substitute any third
          party.

                                     - 10 -

<PAGE>

               (g)    Voting Rights. Upon the occurrence of an Event of Default,
          Pledgor will not exercise any voting rights with respect to securities
          pledged as Collateral. Pledgor hereby irrevocably appoints Secured
          Party as Pledgor's attorney-in-fact (such power of attorney being
          coupled with an interest) and proxy to exercise any voting rights with
          respect to Pledgor's securities pledged as Collateral upon the
          occurrence of an Event of Default.

               (h)    Dividend Rights and Interest Payments. Upon the occurrence
          and during the continuation of an Event of Default:

                 (i)   all rights of Pledgor to receive and retain the dividends
               and interest payments which it would otherwise be authorized to
               receive and retain pursuant to Section 3 shall automatically
               cease, and all such rights shall thereupon become vested with
               Secured Party which shall thereafter have the sole right to
               receive, hold and apply as Collateral such dividends and interest
               payments; and

                 (ii)  all dividend and interest payments which are received by
               Pledgor contrary to the provisions of clause (i) of this
               Subsection shall be received in trust for the benefit of Secured
               Party, shall be segregated from other funds of Pledgor, and shall
               be forthwith paid over to Secured Party in the exact form
               received (properly endorsed or assigned if requested by Secured
               Party), to be held by Secured Party as Collateral.

          12.  INDEMNITY. Pledgor hereby indemnifies and agrees to hold harmless
Secured Party, and its officers, directors, employees, agents and
representatives (each an "Indemnified Person") from and against any and all
liabilities, obligations, claims, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
(collectively, the "Claims") which may be imposed on, incurred by, or asserted
against, any Indemnified Person arising in connection with the Loan Documents,
the Indebtedness or the Collateral (including without limitation, the
enforcement of the Loan Documents and the defense of any Indemnified Person's
actions and/or inactions in connection with the Loan Documents). WITHOUT
LIMITATION, THE FOREGOING INDEMNITIES SHALL APPLY TO EACH INDEMNIFIED PERSON
WITH RESPECT TO ANY CLAIMS WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT
OF THE NEGLIGENCE (WHETHER SOLE, COMPARATIVE OR CONTRIBUTORY) OF SUCH AND/OR ANY
OTHER INDEMNIFIED PERSON, OR FOR WHICH SUCH OR ANY OTHER INDEMNIFIED PERSON
MIGHT OTHERWISE BE LIABLE (BY VIRTUE OF STRICT LIABILITY OR OTHERWISE), except
to the limited extent the Claims against an Indemnified Person are proximately
caused by such Indemnified Person's gross negligence or willful misconduct. If
Pledgor or any third party ever alleges such gross negligence or willful
misconduct by any Indemnified Person, the indemnification provided for in this
Section shall nonetheless be paid upon demand, subject to later adjustment or
reimbursement, until such time as a court of competent jurisdiction enters a
final judgment as to the extent and effect of the alleged gross negligence or
willful misconduct. The indemnification provided for in this Section shall
survive the termination of this Agreement and shall extend and continue to
benefit each individual or entity who is or has at any time been an Indemnified
Person hereunder.

          13.  MISCELLANEOUS.

               (a)    Entire Agreement. This Agreement contains the entire
          agreement of Secured Party and Pledgor with respect to the Collateral.
          If the parties hereto are parties to any prior agreement, either
          written or oral, relating to the Collateral, the terms of this
          Agreement shall amend and supersede the terms of such prior agreements
          as to transactions on or after the effective date of this Agreement,
          but all security agreements, financing statements, guaranties, other
          contracts and notices for the benefit of Secured Party shall continue
          in full force and effect

                                     - 11 -

<PAGE>

          to secure the Indebtedness unless Secured Party specifically releases
          its rights thereunder by separate release.

               (b)    Amendment. No modification, consent or amendment of any
          provision of this Agreement or any of the other Loan Documents shall
          be valid or effective unless the same is in writing and signed by the
          party against whom it is sought to be enforced.

               (c)    Actions by Secured Party. The lien, security interest and
          other security rights of Secured Party hereunder shall not be impaired
          by (i) any renewal, extension, increase or modification with respect
          to the Indebtedness, (ii) any surrender, compromise, release, renewal,
          extension, exchange or substitution which Secured Party may grant with
          respect to the Collateral, or (iii) any release or indulgence granted
          to any endorser, guarantor or surety of the Indebtedness. The taking
          of additional security by Secured Party shall not release or impair
          the lien, security interest or other security rights of Secured Party
          hereunder or affect the obligations of Pledgor hereunder.

               (d)    Waiver by Secured Party. Secured Party may waive any Event
          of Default without waiving any other prior or subsequent Event of
          Default. Secured Party may remedy any default without waiving the
          Event of Default remedied. Neither the failure by Secured Party to
          exercise, nor the delay by Secured Party in exercising, any right or
          remedy upon any Event of Default shall be construed as a waiver of
          such Event of Default or as a waiver of the right to exercise any such
          right or remedy at a later date. No single or partial exercise by
          Secured Party of any right or remedy hereunder shall exhaust the same
          or shall preclude any other or further exercise thereof, and every
          such right or remedy hereunder may be exercised at any time. No waiver
          of any provision hereof or consent to any departure by Pledgor
          therefrom shall be effective unless the same shall be in writing and
          signed by Secured Party and then such waiver or consent shall be
          effective only in the specific instances, for the purpose for which
          given and to the extent therein specified. No notice to or demand on
          Pledgor in any case shall of itself entitle Pledgor to any other or
          further notice or demand in similar or other circumstances.

               (e)    Costs and Expenses. Pledgor will upon demand pay to
          Secured Party the amount of any and all costs and expenses (including
          without limitation, attorneys' fees and expenses), which Secured Party
          may incur in connection with (i) the transactions which give rise to
          the Loan Documents, (ii) the preparation of this Agreement and the
          perfection and preservation of the security interests granted under
          the Loan Documents, (iii) the administration of the Loan Documents,
          (iv) the custody, preservation, use or operation of, or the sale or
          other disposition of, collection from, or other realization upon, the
          Collateral, (v) the exercise or enforcement of any of the rights of
          Secured Party under the Loan Documents, or (vi) the failure by Pledgor
          to perform or observe any of the provisions hereof.

               (f)    GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
          CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS AND
          APPLICABLE FEDERAL LAWS, EXCEPT TO THE EXTENT PERFECTION AND THE
          EFFECT OF PERFECTION OR NON-PERFECTION OF THE SECURITY INTEREST
          GRANTED HEREUNDER, IN RESPECT OF ANY PARTICULAR COLLATERAL, ARE
          GOVERNED BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF TEXAS.

               (g)    Venue. This Agreement has been entered into in the county
          in Texas where Bank's address for notice purposes is located, and it
          shall be performable for all purposes in such county. Courts within
          the State of Texas shall have jurisdiction over any and all disputes
          arising

                                     - 12 -

<PAGE>

          under or pertaining to this Agreement and venue for any such disputes
          shall be in the county or judicial district where this Agreement has
          been executed and delivered.

               (h)    Severability. If any provision of this Agreement is held
          by a court of competent jurisdiction to be illegal, invalid or
          unenforceable under present or future laws, such provision shall be
          fully severable, shall not impair or invalidate the remainder of this
          Agreement and the effect thereof shall be confined to the provision
          held to be illegal, invalid or unenforceable.

               (i)    No Obligation. Nothing contained herein shall be construed
          as an obligation on the part of Secured Party to extend or continue to
          extend credit to Borrower.

               (j)    Notices. All notices, requests, demands or other
          communications required or permitted to be given pursuant to this
          Agreement shall be in writing and given by (i) personal delivery, (ii)
          expedited delivery service with proof of delivery, or (iii) United
          States mail, postage prepaid, registered or certified mail, return
          receipt requested, sent to the intended addressee at the address set
          forth on the signature page hereof or to such different address as the
          addressee shall have designated by written notice sent pursuant to the
          terms hereof and shall be deemed to have been received either, in the
          case of personal delivery, at the time of personal delivery, in the
          case of expedited delivery service, as of the date of first attempted
          delivery at the address and in the manner provided herein, or in the
          case of mail, two (2) business days after deposit in a depository
          receptacle under the care and custody of the United States Postal
          Service. Either party shall have the right to change its address for
          notice hereunder to any other location within the continental United
          States by notice to the other party of such new address at least
          thirty (30) days prior to the effective date of such new address.

               (k)    Binding Effect and Assignment. This Agreement (i) creates
          a continuing security interest in the Collateral, (ii) shall be
          binding on Pledgor and the heirs, executors, administrators, personal
          representatives, successors and assigns of Pledgor, and (iii) shall
          inure to the benefit of Secured Party and its successors and assigns.
          Without limiting the generality of the foregoing, Secured Party may
          pledge, assign or otherwise transfer the Indebtedness and its rights
          under this Agreement and any of the other Loan Documents to any other
          party. Pledgor's rights and obligations hereunder may not be assigned
          or otherwise transferred without the prior written consent of Secured
          Party.

               (l)    Termination. It is contemplated by the parties hereto that
          from time to time there may be no outstanding Indebtedness, but
          notwithstanding such occurrences, this Agreement shall remain valid
          and shall be in full force and effect as to subsequent outstanding
          Indebtedness. Upon (i) the satisfaction in full of the Indebtedness,
          (ii) the termination or expiration of any commitment of Secured Party
          to extend credit to Borrower, (iii) written request for the
          termination hereof delivered by Pledgor to Secured Party, and (iv)
          written release delivered by Secured Party to Pledgor, this Agreement
          and the security interests created hereby shall terminate. Upon
          termination of this Agreement and Pledgor's written request, Secured
          Party will, at Pledgor's sole cost and expense, return to Pledgor such
          of the Collateral as shall not have been sold or otherwise disposed of
          or applied pursuant to the terms hereof and execute and deliver to
          Pledgor such documents as Pledgor shall reasonably request to evidence
          such termination.

               (m)    Cumulative Rights. All rights and remedies of Secured
          Party hereunder are cumulative of each other and of every other right
          or remedy which Secured Party may otherwise have at law or in equity
          or under any of the other Loan Documents, and the exercise of one or
          more of such rights or remedies shall not prejudice or impair the
          concurrent or subsequent exercise of any other rights or remedies.

                                     - 13 -

<PAGE>

               (n)    Gender and Number. Within this Agreement, words of any
          gender shall be held and construed to include the other gender, and
          words in the singular number shall be held and construed to include
          the plural and words in the plural number shall be held and construed
          to include the singular, unless in each instance the context requires
          otherwise.

               (o)    Descriptive Headings. The headings in this Agreement are
          for convenience only and shall in no way enlarge, limit or define the
          scope or meaning of the various and several provisions hereof.

          EXECUTED as of the date first written above.

Debtor's Address:                           PLEDGOR:

AMX Corporation                             AMX Corporation, a Texas corporation
3000 Research Drive
Richardson, Texas                           By: /s/ Jean M. Nelson
Attn:  Jean Nelson                             ---------------------------------
                                            Name: Jean M. Nelson
                                                 -------------------------------
                                            Title: VP & CFO
                                                  ------------------------------

Secured Party's Address:

Bank One, NA
1717 Main Street, 3rd Floor
Dallas, Texas  75201
Attn:  Middle Market Banking Group (Fred Points)

                                     - 14 -

<PAGE>
                                  SCHEDULE "A"
                                       TO
                                PLEDGE AGREEMENT
                            DATED September 30, 2002
                                 BY AND BETWEEN
                                  BANK ONE, NA
                                       AND
                                 AMX Corporation

The following property is a part of the Collateral as defined in Subsection
1(c):

               81,250 shares of stock of AMX(UK) Limited represented by
               Certificate No. 8.

                                     - 15 -

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