Document:

Bioshaft Water Technology, Inc.: Exhibit 10.1 - Filed by newsfilecorp.com

THIS PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT (THE
"SUBSCRIPTION AGREEMENT") RELATES TO AN OFFERING OF SECURITIES IN AN OFFSHORE
TRANSACTION TO PERSONS WHO ARE NOT U.S. PERSONS (AS DEFINED HEREIN) PURSUANT TO
REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"1933 ACT"). 

NONE OF THE SECURITIES TO WHICH THIS SUBSCRIPTION AGREEMENT
RELATES HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES
LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD, DIRECTLY OR
INDIRECTLY, IN THE UNITED STATES OR TO U.S. PERSONS (AS DEFINED HEREIN) EXCEPT
IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE
STATE SECURITIES LAWS.

PRIVATE PLACEMENT SUBSCRIPTION
FOR NON U.S.
SUBSCRIBERS

BIOSHAFT WATER TECHNOLOGY, INC. 

PRIVATE
PLACEMENT

INSTRUCTIONS TO SUBSCRIBER:
  

	1. 	
      COMPLETE the information on page 2 of this
      Subscription Agreement.

	 	 
	2. 	
      FAX a copy of page 2 of this Subscription
      Agreement, and if resident in Canada, all pages of the Questionnaire
      attached as Schedule A, to Bioshaft Water Technology, Inc., attention Adam
      Yassine at (949) 313-2926 .

	 	 
	3. 	
      COURIER the originally executed copy of the entire
      Subscription Agreement, together with the Questionnaire (if applicable),
      to Bioshaft Water Technology, Inc. to

Bioshaft Water Technology, Inc.
1 Orchard Road, Suite
220
Lake Forest, CA 92630
Attention: Adam Yassine

2

BIOSHAFT WATER TECHNOLOGY, INC. 
PRIVATE PLACEMENT

The Subscriber hereby irrevocably subscribes for, and on
Closing will purchase from the Company, the following securities at a price of
US$0.05 per Unit

	_____________________Units
  

The Subscriber directs the Company to issue, register and
deliver the certificates representing the Shares and the Warrants as
follows:

	REGISTRATION INSTRUCTIONS: 	 	DELIVERY INSTRUCTIONS:
    
	 	 	 
	Name to appear on certificate 	 	Name and account reference, if applicable 
	 	 	 
	SIN/Tax ID No. 	 	Contact name 
	 	 	 
	Address 	 	Address 
	  	 	
	 	 	Telephone number

	EXECUTED by the Subscriber this _____ day
      of__________, _____. By executing this Agreement, the Subscriber certifies
      that the Subscriber and any beneficial purchaser for whom the
      Subscriber is acting is resident in the jurisdiction shown as the “Address
      of the Subscriber”. The address of the Subscriber will be accepted
      by the Company as a representative as to the address of residency for
      the Subscriber. 

	WITNESS: 	  	EXECUTION BY SUBSCRIBER:
    
	  	  	X 
	Signature of witness 	  	Signature of individual (if Subscriber is an
      individual) 
	  	  	X 
	Name of witness 	  	Authorized signatory (if Subscriber is not an
      individual) 
	  	  	  
	Address of witness 	  	Name of Subscriber (please print) 
	  	  	  
	  	  	Name of authorized signatory
      (please print) 
	ACCEPTED this _____ day of ___________, _____. 		  
	BIOSHAFT WATER TECHNOLOGY, INC. 	 	Address of Subscriber
      (residence) 
	Per: 	  	  
	Authorized signatory 	  	Telephone number and e-mail
      address 

By signing this acceptance, the Company agrees to be bound by
all representations, warranties, covenants and agreements on pages 3-11
hereof.

This Subscription Agreement may be executed in any number of
counterparts, each of which, when so executed and delivered, shall constitute an
original and all of which together shall constitute one instrument. Delivery of
an executed copy of this Subscription Agreement by electronic facsimile
transmission or other means of electronic communication capable of producing a
printed copy will be deemed to be execution and delivery of this Subscription
Agreement as of the date hereinafter set forth.

3

THIS PRIVATE PLACEMENT SUBSCRIPTION AGREEMENT (THE
"SUBSCRIPTION AGREEMENT") RELATES TO AN OFFERING OF SECURITIES IN AN OFFSHORE
TRANSACTION TO PERSONS WHO ARE NOT U.S. PERSONS (AS DEFINED HEREIN) PURSUANT TO
REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"1933 ACT"). 

NONE OF THE SECURITIES TO WHICH THIS SUBSCRIPTION AGREEMENT
RELATES HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR ANY U.S. STATE SECURITIES
LAWS, AND, UNLESS SO REGISTERED, NONE MAY BE OFFERED OR SOLD, DIRECTLY OR
INDIRECTLY, IN THE UNITED STATES OR TO U.S. PERSONS (AS DEFINED HEREIN) EXCEPT
IN ACCORDANCE WITH THE PROVISIONS OF REGULATION S UNDER THE 1933 ACT, PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE 1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE
STATE SECURITIES LAWS.

PRIVATE PLACEMENT SUBSCRIPTION
(Non U.S. Subscribers
Only)

	TO: 	Bioshaft Water Technology, Inc. (the “Company”)
    

Purchase of Units

	1.            
      SUBSCRIPTION

1.1           
The undersigned (the "Subscriber") hereby irrevocably subscribes for and agrees
to purchase the number of units of the Company's common stock (the "Units") as
set out on page 2 of this Subscription Agreement at a price of US$0.05 per Unit
(such subscription and agreement to purchase being the "Subscription"), for the
total subscription price as set out on page 2 of this Subscription Agreement
(the "Subscription Proceeds"), which Subscription Proceeds are tendered
herewith, on the basis of the representations and warranties and subject to the
terms and conditions set forth herein.

1.2           
Each Unit will consist of one share of common stock in the capital of the
Company (each, a "Share"); and one common share purchase warrant (each a
“Warrant”) subject to adjustment. Each whole Warrant shall be non-transferable
and shall entitle the holder thereof to purchase one share of common stock in
the capital of the Company (each, a “Warrant Share”), as presently constituted,
for a period of sixty months commencing from the Closing (as defined hereafter),
at a price per Warrant Share of US$0.10. The Shares, Warrants and Warrant Shares
are referred to as the “Securities”.

1.3           
The Company hereby agrees to sell, on the basis of the representations and
warranties and subject to the terms and conditions set forth herein, to the
Subscriber the Units. Subject to the terms hereof, the Subscription Agreement
will be effective upon its acceptance by the Company.

1.4           
Unless otherwise provided, all dollar amounts referred to in this Subscription
Agreement are in lawful money of the United States of America.

2.             
PAYMENT

2.1           
The Subscription Proceeds must accompany this Subscription Agreement. The
Subscriber authorizes the Company's lawyers to deliver the Subscription Proceeds
to the Company if the Subscription Proceeds are delivered to the Company’s
lawyers, without further instructions required.

4

2.2           
The Subscriber acknowledges and agrees that this Subscription Agreement and any
other documents delivered in connection herewith will be held by the Company's
lawyers on behalf of the Company. In the event that this Subscription Agreement
is not accepted by the Company for whatever reason within 90 days of the
delivery of an executed Subscription Agreement by the Subscriber, or the minimum
offering amount is not achieved by that time, this Subscription Agreement, the
Subscription Proceeds and any other documents delivered in connection herewith
will be returned to the Subscriber at the address of the Subscriber as set forth
in this Subscription Agreement without interest or deduction.

2.3           
Where the Subscription Proceeds are paid to the Company, the Company may treat
the Subscription Proceeds as a non-interest bearing loan and may use the
Subscription Proceeds prior to this Subscription Agreement being accepted by the
Company.

2.4           
The Subscriber shall complete, sign and return to the Company as soon as
possible, on request by the Company, any documents, questionnaires, notices and
undertakings as may be required by regulatory authorities, the OTC Bulletin
Board, stock exchanges and applicable law.

	3.             
      CLOSING

3.1           
Closing of the purchase and sale of the Units shall occur on or before March 31,
2010, or on such other date as may be determined by the Company in its sole
discretion (the "Closing Date"). The Subscriber acknowledges that Units may be
issued to other subscribers under this offering (the "Offering") before or after
the Closing Date. The Company, may, at its discretion, elect to close the
Offering in one or more closings, in which event the Company may agree with one
or more subscribers (including the Subscriber hereunder) to complete delivery of
the Shares and the Warrants to such subscriber(s) against payment therefore at
any time on or prior to the Closing Date.

3.2           
The Subscriber will deliver to the Company the Subscription Agreement and all
applicable schedules and required forms, duly executed, and payment in full for
the total price of the Securities to be purchased by the Purchaser.

	4.             
      ACKNOWLEDGEMENTS OF SUBSCRIBER
	 
	4.1           
      The Subscriber acknowledges and agrees that:

	 	(a) 	none of the Securities have been registered under the
      Securities Act of 1933, as amended (the "1933 Act"), or under any state
      securities or "blue sky" laws of any state of the United States, and are
      being offered only in a transaction not involving any public offering
      within the meaning of the 1933 Act, and, unless so registered, may not be
      offered or sold in the United States or to U.S. Persons (as defined
      herein), except pursuant to an effective registration statement under the
      1933 Act, or pursuant to an exemption from, or in a transaction not
      subject to, the registration requirements of the 1933 Act, and in each
      case only in accordance with applicable state and provincial securities
      laws;
	 	 	 
	 	(b) 	
      the Company will refuse to register any transfer of any
      of the Securities not made in accordance with the provisions of Regulation
      S, pursuant to an effective registration statement under the 1933 Act or
      pursuant to an available exemption from, or in a transaction not subject
      to, the registration requirements of the 1933 Act;

	 	 	 
	 	(c) 	
      by completing the Questionnaire, the Subscriber is
      representing and warranting that the Subscriber satisfies one of the
      categories of registration and prospectus exemptions provided for in
      National Instrument 45-106 ("NI 45-106") adopted by the Canadian
      Securities Administrators (the "CSA");

	 	 	 
	 	(d) 	
      the decision to execute this Subscription Agreement and
      purchase the Units agreed to be purchased hereunder has not been based
      upon any oral or written representation as to fact or otherwise made by or
      on behalf of the Company and such decision is based solely upon a
      review of publicly available information regarding the Company
      available on the website of the United States Securities and Exchange
      Commission (the "SEC") available at www.sec.gov and on the System for
      Electronic Document Analysis and Retrieval website available at
  www.sedar.com and (the "Company Information");

5

	 	(e) 	
      the Subscriber and the Subscriber's advisor(s) have had a
      reasonable opportunity to review the Company Information and to ask
      questions of and receive answers from the Company regarding the Offering,
      and to obtain additional information, to the extent possessed or
      obtainable without unreasonable effort or expense, necessary to verify the
      accuracy of the information contained in the Company Information, or any
      other document provided to the Subscriber;

	 	 	 	 
	 	(f) 	
      the books and records of the Company were available upon
      reasonable notice for inspection, subject to certain confidentiality
      restrictions, by the Subscriber during reasonable business hours at its
      principal place of business and that all documents, records and books
      pertaining to this Offering have been made available for inspection by the
      Subscriber, the Subscriber's attorney and/or advisor(s);

	 	 	 	 
	 	(g) 	
      by execution hereof the Subscriber has waived the need
      for the Company to communicate its acceptance of the purchase of the Units
      pursuant to this Subscription Agreement;

	 	 	 	 
	 	(h) 	
      the Company is entitled to rely on the representations
      and warranties and the statements and answers of the Subscriber contained
      in this Subscription Agreement and the Questionnaire and the Subscriber
      will hold harmless the Company from any loss or damage it may suffer as a
      result of the Subscriber's failure to correctly complete this Subscription
      Agreement and the Questionnaire;

	 	 	 	 
	 	(i) 	
      the Subscriber will indemnify and hold harmless the
      Company and, where applicable, its respective directors, officers,
      employees, agents, advisors and shareholders from and against any and all
      loss, liability, claim, damage and expense whatsoever (including, but not
      limited to, any and all fees, costs and expenses whatsoever reasonably
      incurred in investigating, preparing or defending against any claim,
      lawsuit, administrative proceeding or investigation whether commenced or
      threatened) arising out of or based upon any acknowledgment,
      representation or warranty of the Subscriber contained herein, the
      Questionnaire or in any other document furnished by the Subscriber to the
      Company in connection herewith, being untrue in any material respect or
      any breach or failure by the Subscriber to comply with any covenant or
      agreement made by the Subscriber to the Company in connection
      therewith;

	 	 	 	 
	 	(j) 	
      the issuance and sale of the Units to the Subscriber will
      not be completed if it would be unlawful or if, in the discretion of the
      Company acting reasonably, it is not in the best interests of the
      Company;

	 	 	 	 
	 	(k) 	
      the Subscriber has been advised to consult the
      Subscriber’s own legal, tax and other advisors with respect to the merits
      and risks of an investment in the Securities and with respect to the
      applicable resale restrictions, and it is solely responsible (and the
      Company is not in any way responsible) for compliance with:

	 	 	 	 
	 		(i) 	
      any applicable laws of the jurisdiction in which the
      Subscriber is resident in connection with the distribution of the
      Securities hereunder, and

	 	 	 	 
	 		(ii) 	
      applicable resale restrictions;

	 	 	 	 
	 	(l) 	
      the Subscriber has not acquired the Units as a result of,
      and will not itself engage in, any "directed selling efforts" (as defined
      in Regulation S under the 1933 Act) in the United States in respect of any
      of the Securities which would include any activities undertaken for the
      purpose of, or that could reasonably be expected to have the effect of,
      conditioning the market in the United States for the resale of any of the
      Securities; provided, however, that the Subscriber may sell or
      otherwise dispose of any of the Shares or the Warrant Shares
      pursuant to registration of any of the Shares or the Warrant Shares
      pursuant to the 1933 Act and any applicable state securities laws or under
      an exemption from such registration requirements and as otherwise provided
      herein;

6

	 	(m) 	
      the Subscriber is outside the United States when
      receiving and executing this Subscription Agreement and is acquiring the
      Units as principal for its own account, for investment purposes only, and
      not with a view to, or for, resale, distribution or fractionalization
      thereof, in whole or in part, and no other person has a direct or indirect
      beneficial interest in such Units;

	 	 	 
	 	(n) 	
      none of the Securities may be offered or sold to a U.S.
      Person or for the account or benefit of a U.S. Person (other than a
      distributor) prior to the end of the expiration of a period of one year
      after the date of original issuance of the Securities;

	 	 	 
	 	(o) 	
      the statutory and regulatory basis for the exemption
      claimed for the offer and sale of the Units, although in technical
      compliance with Regulation S, would not be available if the offering is
      part of a plan or scheme to evade the registration provisions of the 1933
      Act;

	 	 	 
	 	(p) 	
      the Company has advised the Subscriber that, if the
      Subscriber is a Canadian resident, the Company is relying on an exemption
      from the requirements to provide the Subscriber with a prospectus and to
      sell the Units through a person registered to sell securities under the
      Securities Act (British Columbia) (the “BC Act”) and, as a
      consequence of acquiring the Units pursuant to this exemption, certain
      protections, rights and remedies provided by the BC Act, including
      statutory rights of rescission or damages, will not be available to the
      Subscriber;

	 	 	 
	 	(q) 	
      none of the Securities are listed on any stock exchange
      or automated dealer quotation system and no representation has been made
      to the Subscriber that any of the Securities will become listed on any
      stock exchange or automated dealer quotation system, except that currently
      certain market makers make market in the shares of the Company's common
      stock on the OTC Bulletin Board;

	 	 	 
	 	(r) 	
      neither the SEC nor any other securities commission or
      similar regulatory authority has reviewed or passed on the merits of any
      of the Securities;

	 	 	 
	 	(s) 	
      no documents in connection with this Offering have been
      reviewed by the SEC or any state securities administrators;

	 	 	 
	 	(t) 	
      there is no government or other insurance covering any of
      the Securities; and

	 	 	 
	 	(u) 	
      this Subscription Agreement is not enforceable by the
      Subscriber unless it has been accepted by the Company, and the Subscriber
      acknowledges and agrees that the Company reserves the right to reject any
      subscription for any reason.

	5.             
      REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE
    SUBSCRIBER

5.1           
The Subscriber hereby represents and warrants to and covenants with the Company
(which representations, warranties and covenants shall survive the Closing Date)
that:

	 	(a) 	
      the Subscriber is not a U.S. Person (as defined
      herein);

	 	 	 
	 	(b) 	
      the Subscriber is not acquiring the Units for the account
      or benefit of, directly or indirectly, any U.S. Person (as defined
      herein);

	 	 	 
	 	(c) 	
      the Subscriber is resident in the jurisdiction set out on
      page 2 of this Subscription Agreement;

	 	 	 
	 	(d) 	
      the Subscriber:

7

	 	(i) 	
      is knowledgeable of, or has been independently advised as
      to, the applicable securities laws of the securities regulators having
      application in the jurisdiction in which the Subscriber is resident (the
      “International Jurisdiction”) which would apply to the acquisition of the
      Units,

	 	 	 	 
	 	(ii) 	
      is purchasing the Units pursuant to exemptions from
      prospectus or equivalent requirements under applicable securities laws or,
      if such is not applicable, the Subscriber is permitted to purchase the
      Units under the applicable securities laws of the securities regulators in
      the International Jurisdiction without the need to rely on any
      exemptions,

	 	 	 	 
	 	(iii) 	
      acknowledges that the applicable securities laws of the
      authorities in the International Jurisdiction do not require the Company
      to make any filings or seek any approvals of any kind whatsoever from any
      securities regulator of any kind whatsoever in the International
      Jurisdiction in connection with the issue and sale or resale of any of the
      Securities, and

	 	 	 	 
	 	(iv) 	
      represents and warrants that the acquisition of the Units
      by the Subscriber does not trigger:

	 	 	 	 
	 		A. 	
      any obligation to prepare and file a prospectus or
      similar document, or any other report with respect to such purchase in the
      International Jurisdiction, or

	 	 	 	 
	 		B. 	
      any continuous disclosure reporting obligation of the
      Company in the International Jurisdiction, and

	 	 	 	 
	 			
      the Subscriber will, if requested by the Company, deliver
      to the Company a certificate or opinion of local counsel from the
      International Jurisdiction which will confirm the matters referred to in
      subparagraphs (ii), (iii) and (iv) above to the satisfaction of the
      Company, acting reasonably;

	 	(e) 	
      the Subscriber is acquiring the Units as principal for
      investment only and not with a view to, or for, resale, distribution or
      fractionalization thereof, in whole or in part, and, in particular, it has
      no intention to distribute either directly or indirectly any of the
      Securities in the United States or to U.S. Persons (as defined
    herein);

	 	 	 
	 	(f) 	
      the Subscriber is outside the United States when
      receiving and executing this Subscription Agreement;

	 	 	 
	 	(g) 	
      the Subscriber understands and agrees not to engage in
      any hedging transactions involving any of the Securities unless such
      transactions are in compliance with the provisions of the 1933 Act and in
      each case only in accordance with applicable state securities
  laws;

	 	 	 
	 	(h) 	
      the Subscriber acknowledges that it has not acquired the
      Units as a result of, and will not itself engage in, any "directed selling
      efforts" (as defined in Regulation S under the 1933 Act) in the United
      States in respect of any of the Securities which would include any
      activities undertaken for the purpose of, or that could reasonably be
      expected to have the effect of, conditioning the market in the United
      States for the resale of any of the Securities; provided, however, that
      the Subscriber may sell or otherwise dispose of any of the Shares or the
      Warrant Shares pursuant to registration of any of the Shares or the
      Warrant Shares pursuant to the 1933 Act and any applicable state
      securities laws or under an exemption from such registration requirements
      and as otherwise provided herein;

	 	 	 
	 	(i) 	
      the Subscriber has the legal capacity and competence to
      enter into and execute this Subscription Agreement and to take all actions
      required pursuant hereto and, if the Subscriber is a corporation, it is
      duly incorporated and validly subsisting under the laws of its
      jurisdiction of incorporation and all necessary approvals by its directors, shareholders
      and others have been obtained to authorize execution and performance of
  this Subscription Agreement on behalf of the Subscriber;

8

	 	(j) 	
      the entering into of this Subscription Agreement and the
      transactions contemplated hereby do not result in the violation of any of
      the terms and provisions of any law applicable to, or, if applicable, the
      constating documents of, the Subscriber, or of any agreement, written or
      oral, to which the Subscriber may be a party or by which the Subscriber is
      or may be bound;

	 	 	 
	 	(k) 	
      the Subscriber has duly executed and delivered this
      Subscription Agreement and it constitutes a valid and binding agreement of
      the Subscriber enforceable against the Subscriber;

	 	 	 
	 	(l) 	
      the Subscriber has received and carefully read this
      Subscription Agreement;

	 	 	 
	 	(m) 	
      the Subscriber (i) has adequate net worth and means of
      providing for its current financial needs and possible personal
      contingencies, (ii) has no need for liquidity in this investment, and
      (iii) is able to bear the economic risks of an investment in the
      Securities for an indefinite period of time, and can afford the complete
      loss of such investment;

	 	 	 
	 	(n) 	
      the Subscriber has the requisite knowledge and experience
      in financial and business matters as to be capable of evaluating the
      merits and risks of the investment in the Securities and the Company, and
      the Subscriber is providing evidence of knowledge and experience in these
      matters through the information requested in the Questionnaire;

	 	 	 
	 	(o) 	
      the Subscriber understands and agrees that the Company
      and others will rely upon the truth and accuracy of the acknowledgements,
      representations, warranties, covenants and agreements contained in this
      Subscription Agreement and the Questionnaire, and agrees that if any of
      such acknowledgements, representations and agreements are no longer
      accurate or have been breached, the Subscriber shall promptly notify the
      Company;

	 	 	 
	 	(p) 	
      the Subscriber is aware that an investment in the Company
      is speculative and involves certain risks, including the possible loss of
      the investment;

	 	 	 
	 	(q) 	
      the Subscriber is purchasing the Units for its own
      account for investment purposes only and not for the account of any other
      person and not for distribution, assignment or resale to others, and no
      other person has a direct or indirect beneficial interest is such Units,
      and the Subscriber has not subdivided his interest in the Units with any
      other person;

	 	 	 
	 	(r) 	
      the Subscriber is not an underwriter of, or dealer in,
      the shares of the Company's common stock, nor is the Subscriber
      participating, pursuant to a contractual agreement or otherwise, in the
      distribution of the Units;

	 	 	 
	 	(s) 	
      the Subscriber has made an independent examination and
      investigation of an investment in the Securities and the Company and has
      depended on the advice of its legal and financial advisors and agrees that
      the Company will not be responsible in anyway whatsoever for the
      Subscriber's decision to invest in the Securities and the
  Company;

	 	 	 
	 	(t) 	
      if the Subscriber is acquiring the Units as a fiduciary
      or agent for one or more investor accounts, the Subscriber has sole
      investment discretion with respect to each such account, and the
      Subscriber has full power to make the foregoing acknowledgements,
      representations and agreements on behalf of such account;

	 	 	 
	 	(u) 	
      the Subscriber is not aware of any advertisement of any
      of the Units and is not acquiring the Units as a result of any form of
      general solicitation or general advertising including advertisements,
      articles, notices or other communications published in any newspaper,
      magazine or similar media or broadcast over radio or television, or any seminar or
      meeting whose attendees have been invited by general solicitation or
      general advertising;

9

	 	(v) 	
      no person has made to the Subscriber any written or oral
      representations:

	 	 	 	 
	 		(i) 	
      that any person will resell or repurchase any of the
      Securities,

	 	 	 	 
	 		(ii) 	
      that any person will refund the purchase price of any of
      the Securities,

	 	 	 	 
	 		(iii) 	
      as to the future price or value of any of the Securities,
      or

	 	 	 	 
	 		(iv) 	
      that any of the Securities will be listed and posted for
      trading on any stock exchange or automated dealer quotation system or that
      application has been made to list and post any of the Securities of the
      Company on any stock exchange or automated dealer quotation system, except
      that currently certain market makers make market in the shares of the
      Company's common stock on the OTC Bulletin Board; and

	 	 	 	 
	 	(w) 	
      the Subscriber acknowledges and agrees that, if the
      Subscriber is resident in Canada, the Company shall not consider the
      Subscriber's Subscription for acceptance unless the undersigned provides
      to the Company, along with an executed copy of this Subscription
      Agreement:

	 	 	 	 
	 		(i) 	
      a fully completed and executed Questionnaire in the form
      attached hereto as Schedule A, and

	 	 	 	 
	 		(ii) 	
      such other supporting documentation that the Company or
      its legal counsel may request to establish the Subscriber's qualification
      as a qualified investor.

5.2           
In this Subscription Agreement, the term "U.S. Person" shall have the meaning
ascribed thereto in Regulation S promulgated under the 1933 Act and for the
purpose of the Subscription Agreement includes any person in the United
States.

	6.             
      ACKNOWLEDGEMENT AND WAIVER

6.1           
The Subscriber has acknowledged that the decision to purchase the Units was
solely made on the Company Information. The Subscriber hereby waives, to the
fullest extent permitted by law, any rights of withdrawal, rescission or
compensation for damages to which the Subscriber might be entitled in connection
with the distribution of any of the Units.

	7.             
      REPRESENTATIONS AND WARRANTIES WILL BE RELIED UPON BY THE
      COMPANY

7.1           
The Subscriber acknowledges that the acknowledgements, representations and
warranties contained herein and in the Questionnaire are made by it with the
intention that they may be relied upon by the Company and its legal counsel in
determining the Subscriber's eligibility to purchase the Units under applicable
securities legislation, or (if applicable) the eligibility of others on whose
behalf it is contracting hereunder to purchase the Units under applicable
securities legislation. The Subscriber further agrees that by accepting delivery
of the certificates representing the Units, it will be representing and
warranting that the acknowledgements representations and warranties contained
herein and in the Questionnaire are true and correct as of the date hereof and
will continue in full force and effect notwithstanding any subsequent
disposition by the Subscriber of such Units.

	8.             
      RESALE RESTRICTIONS

8.1           
The Subscriber acknowledges that any resale of the Securities will be subject to
resale restrictions contained in the securities legislation applicable to the
Subscriber or proposed transferee. The Subscriber acknowledges that none of the Securities have been registered
under the 1933 Act or the securities laws of any state of the United States.
None of the Securities may be offered or sold in the United States unless
registered in accordance with federal securities laws and all applicable state
securities laws or exemptions from such registration requirements are
available.

10

	9.             
      LEGENDING AND REGISTRATION OF SUBJECT
  SECURITIES

9.1           
The Subscriber hereby acknowledges that upon the issuance thereof, and until
such time as the same is no longer required under the applicable securities laws
and regulations, the certificates representing any of the Shares, the Warrants
or the Warrant Shares will bear a legend in substantially the following
form:

	THE SECURITIES REPRESENTED HEREBY HAVE BEEN
      OFFERED IN AN OFFSHORE TRANSACTION TO A PERSON WHO IS NOT A U.S. PERSON
      (AS DEFINED HEREIN) PURSUANT TO REGULATION S UNDER THE UNITED STATES
      SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"). 

NONE OF THE
      SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED UNDER THE 1933 ACT, OR
      ANY U.S. STATE SECURITIES LAWS, AND, UNLESS SO REGISTERED, MAY NOT BE
      OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES (AS DEFINED
      HEREIN) OR TO U.S. PERSONS EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF
      REGULATION S UNDER THE 1933 ACT, PURSUANT TO AN EFFECTIVE REGISTRATION
      STATEMENT UNDER THE 1933 ACT, OR PURSUANT TO AN AVAILABLE EXEMPTION FROM,
      OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
      1933 ACT AND IN EACH CASE ONLY IN ACCORDANCE WITH APPLICABLE STATE
      
SECURITIES LAWS. IN ADDITION, HEDGING TRANSACTIONS 
INVOLVING THE
      SECURITIES MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE 1933 ACT.
      "UNITED STATES" AND "U.S. PERSON" ARE AS DEFINED BY REGULATION S UNDER THE
      1933 ACT. 

9.2            
The Subscriber hereby acknowledges and agrees to the Company making a notation
on its records or giving instructions to the registrar and transfer agent of the
Company in order to implement the restrictions on transfer set forth and
described in this Subscription Agreement.

	10.           
       NOTICES TO RESIDENTS OF THE EUROPEAN ECONOMIC
  AREA

10.1           
In relation to each member state of the European Economic Area (the “EEA”) which
has implemented Directive 2003/71/EC (the “Prospectus Directive”) (each, a
“Relevant Member State”), Units may only be offered or sold in the Relevant
Member State under the following exemptions under the Prospectus Directive, if
they have been implemented in that Relevant Member State:

	 	(a) 	
      to legal entities which are authorised or regulated to
      operate in the financial markets or, if not so authorised or regulated,
      whose corporate purpose is solely to invest in securities;

	 	 	 
	 	(b) 	
      to any legal entity which has two or more of (1) an
      average of at least 250 employees during the last financial year; (2) a
      total balance sheet of more than €43,000,000; and (3) an annual net
      turnover of more than €50,000,000, as shown in its last annual or
      consolidated accounts;

	 	 	 
	 	(c) 	
      in any other circumstances falling within Article 3(2) of
      the Prospectus Directive;

11

provided that no such offer of Units shall result in a
requirement for the publication by the Company of a prospectus pursuant to
Article 3 of the Prospectus Directive.

	11.             
      COSTS

11.1           
The Subscriber acknowledges and agrees that all costs and expenses incurred by
the Subscriber (including any fees and disbursements of any special counsel
retained by the Subscriber) relating to the purchase of the Units shall be borne
by the Subscriber.

	12.             
      GOVERNING LAW

12.1           
This Subscription Agreement is governed by the laws of the State of Nevada. The
Subscriber, in its personal or corporate capacity and, if applicable, on behalf
of each beneficial purchaser for whom it is acting, irrevocably attorns to the
exclusive jurisdiction of the Courts of the State of Nevada.

	13.             
      SURVIVAL

13.1           
This Subscription Agreement, including without limitation the representations,
warranties and covenants contained herein, shall survive and continue in full
force and effect and be binding upon the parties hereto notwithstanding the
completion of the purchase of the Units by the Subscriber pursuant hereto.

	14.             ASSIGNMENT

14.1           
This Subscription Agreement is not transferable or assignable.

	15.            
      SEVERABILITY

15.1           
The invalidity or unenforceability of any particular provision of this
Subscription Agreement shall not affect or limit the validity or enforceability
of the remaining provisions of this Subscription Agreement.

	16.            
      ENTIRE AGREEMENT

16.1           
Except as expressly provided in this Subscription Agreement and in the
agreements, instruments and other documents contemplated or provided for herein,
this Subscription Agreement contains the entire agreement between the parties
with respect to the sale of the Units and there are no other terms, conditions,
representations or warranties, whether expressed, implied, oral or written, by
statute or common law, by the Company or by anyone else.

	17.             
      NOTICES

17.1           
All notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed or transmitted by any standard form of
telecommunication. Notices to the Subscriber shall be directed to the address on
page 2 and notices to the Company shall be directed to it at the first page of
this Subscription Agreement.

	18.            
      COUNTERPARTS AND ELECTRONIC
MEANS

18.1           
This Subscription Agreement may be executed in any number of counterparts, each
of which, when so executed and delivered, shall constitute an original and all
of which together shall constitute one instrument. Delivery of an executed copy
of this Subscription Agreement by electronic facsimile transmission or other
means of electronic communication capable of producing a printed copy will be
deemed to be execution and delivery of this Subscription Agreement as of the
date hereinafter set forth.

SCHEDULE A

CANADIAN QUESTIONNAIRE

All capitalized terms herein, unless otherwise defined, have
the meanings ascribed thereto in the Subscription Agreement.

The purpose of this Questionnaire is to assure the Company that
the Subscriber will meet certain requirements of National Instrument 45-106 ("NI
45-106"). The Company will rely on the information contained in this
Questionnaire for the purposes of such determination.

The Subscriber covenants, represents and warrants to the
Company that:

	 	1. 	
      the Subscriber has such knowledge and experience in
      financial and business matters as to be capable of evaluating the merits
      and risks of the transactions detailed in the Subscription Agreement and
      the Subscriber is able to bear the economic risk of loss arising from such
      transactions;
	 
	 	 	 	 	 
	 	2. 	
      the Subscriber is (tick one or more of the following
      boxes):
	 
	 	 	 	 	 
	 		(A) 	
      a director, executive officer, employee or control person
      of the Company or an affiliate of the Company
	 [ ]
	 	 	 	 	 
	 		(B) 	
      a spouse, parent, grandparent, brother, sister or child
      of a director, executive officer, founder or control person of the Company
      or an affiliate of the Company
	 [ ]
	 	 	 	 	 
	 		(C) 	
      a parent, grandparent, brother, sister or child of the
      spouse of a director, executive officer, founder or control person of the
      Company or an affiliate of the Company
	 [ ]
	 	 	 	 	 
	 		(D) 	
      a close personal friend of a director, executive officer,
      founder or control person of the Company
	 [ ]
	 	 	 	 	 
	 		(E) 	
      a close business associate of a director, executive
      officer, founder or control person of the Company or an affiliate of the
      Company
	 [ ]
	 	 	 	 	 
	 		(F) 	
      an accredited investor
	 [ ]
	 	 	 	 	 
	 		(G) 	
      a company, partnership or other entity of which a
      majority of the voting securities are beneficially owned by, or a majority
      of the directors are, persons described in paragraphs A to F
	 [ ]
	 	 	 	 	 
	 		(H) 	
      a trust or estate of which all of the beneficiaries or a
      majority of the trustees or executors are persons described in paragraphs
      A to F
	 [ ]
	 	 	 	 	 
	 		(I) 	
      purchasing as principal Securities with an aggregate
      acquisition cost of not less than CDN$150,000
	 [ ]

- 2 -

	 	3. 	
      if the Subscriber has checked box B, C, D, E, G or H in
      Section 2 above, the director, executive officer, founder or control
      person of the Company with whom the undersigned has the relationship
      is:

	 	 	 	 	 
	 	 	 	 	 
	 		
      (Instructions to Subscriber: fill in the name of each
      director, executive officer, founder and control person which you have the
      above-mentioned relationship with. If you have checked box G or H, also
      indicate which of A to F describes the securityholders, directors,
      trustees or beneficiaries which qualify you as box G or H and provide the
      names of those individuals. Please attach a separate page if
      necessary).

	 	 	 	 	 
	 	4. 	
      if the Subscriber is resident in Ontario, the Subscriber
      is (tick one or more of the following boxes):
	 
	 	 	 	 	 
	 		(A) 	
      a founder of the Company
	 [ ]
	 	 	 	 	 
	 		(B) 	
      an affiliate of a founder of the Company
	 [ ]
	 	 	 	 	 
	 		(C) 	
      a spouse, parent, brother, sister, grandparent or child
      of a director, executive officer or founder of the Company
	 [ ]
	 	 	 	 	 
	 		(D) 	
      a person that is a control person of the Company
	 [ ]
	 	 	 	 	 
	 		(E) 	
      an accredited investor
	 [ ]
	 	 	 	 	 
	 		(F) 	
      purchasing as principal Securities with an aggregate
      acquisition cost of not less than CDN$150,000
	 [ ]

	 	5. 	
      if the Subscriber has checked box A, B, C or D in Section
      4 above, the director, executive officer,

	 	 	 
	 	 	 
	 		
      founder or control person of the Company with whom the
      undersigned has the relationship is:

	 	 	 
	 		
      (Instructions to Subscriber: fill in the name of each
      director, executive officer, founder, affiliate and control person which
      you have the above-mentioned relationship with.)

	 	 	 
	 	6. 	
      if the Subscriber has ticked box F in Section 2 or box E
      in Section 4 above, the Subscriber satisfies one or more of the categories
      of "accredited investor" (as that term is defined in NI 45-106) indicated
      below (please check the appropriate box):

	 	[ ] 	
      (a) a Canadian financial institution as defined in
      National Instrument 14-101, or an authorized foreign bank listed in
      Schedule III of the Bank Act (Canada);

	 	 	 
	 	[ ] 	
      (b) the Business Development Bank of Canada incorporated
      under the Business Development Bank Act (Canada);

	 	 	 
	 	[ ] 	
      (c) a subsidiary of any person referred to in any of the
      foregoing categories, if the person owns all of the voting securities of
      the subsidiary, except the voting securities required by law to be owned
      by directors of that subsidiary;

	 	 	 
	 	[ ] 	
      (d) an individual registered or formerly registered under
      securities legislation in a jurisdiction of Canada, as a representative of
      a person or company registered under securities legislation in a
      jurisdiction of Canada, as an adviser or dealer, other than a limited
      market dealer registered under the Securities Act (Ontario) or the
      Securities Act (Newfoundland);

- 3 -

	 	[ ] 	
      (e) an individual registered or formerly registered under
      the securities legislation of a jurisdiction of Canada as a representative
      of a person referred to in paragraph (d);

	 	 	 
	 	[ ] 	
      (f) the government of Canada or a province, or any crown
      corporation or agency of the government of Canada or a province;

	 	 	 
	 	[ ] 	
      (g) a municipality, public board or commission in Canada
      and a metropolitan community, school board, the Comite de gestion de la
      taxe scholaire de l'ile de Montreal or an intermunicipal management board
      in Québec;

	 	 	 
	 	[ ] 	
      (h) a national, federal, state, provincial, territorial
      or municipal government of or in any foreign jurisdiction, or any agency
      thereof;

	 	 	 
	 	[ ] 	
      (i) a pension fund that is regulated by either the Office
      of the Superintendent of Financial Institutions (Canada) or a pension
      commission or similar regulatory authority of a jurisdiction of
    Canada;

	 	 	 
	 	[ ] 	
      (j) an individual who either alone or with a spouse
      beneficially owns, directly or indirectly, financial assets (as defined in
      NI 45-106) having an aggregate realizable value that, before taxes but net
      of any related liabilities, exceeds CDN$1,000,000;

	 	 	 
	 	[ ] 	
      (k) an individual whose net income before taxes exceeded
      CDN$200,000 in each of the two more recent calendar years or whose net
      income before taxes combined with that of a spouse exceeded $300,000 in
      each of those years and who, in either case, reasonably expects to exceed
      that net income level in the current calendar year;

	 	 	 
	 	[ ] 	
      (l) an individual who, either alone or with a spouse, has
      net assets of at least CDN $5,000,000;

	 	 	 
	 	[ ] 	
      (m) a person, other than an individual or investment
      fund, that had net assets of at least CDN$5,000,000 as reflected on its
      most recently prepared financial statements;

	 	 	 
	 	[ ] 	
      (n) an investment fund that distributes it securities
      only to persons that are accredited investors at the time of distribution,
      a person that acquires or acquired a minimum of CDN$150,000 of value in
      securities, or a person that acquires or acquired securities under
      Sections 2.18 or 2.19 of NI 45-106;

	 	 	 
	 	[ ] 	
      (o) an investment fund that distributes or has
      distributed securities under a prospectus in a jurisdiction of Canada for
      which the regulator or, in Québec, the securities regulatory authority,
      has issued a receipt;

	 	 	 
	 	[ ] 	
      (p) a trust company or trust corporation registered or
      authorized to carry on business under the Trust and Loan Companies Act
      (Canada) or under comparable legislation in a jurisdiction of Canada
      or a foreign jurisdiction, acting on behalf of a fully managed account
      managed by the trust company or trust corporation, as the case may
    be;

	 	 	 
	 	[ ] 	
      (q) a person acting on behalf of a fully managed account
      managed by that person, if that person (i) is registered or authorized to
      carry on business as an adviser or the equivalent under the securities
      legislation of a jurisdiction of Canada or a foreign jurisdiction, and
      (ii) in Ontario, is purchasing a security that is not a security of an
      investment fund;

	 	 	 
	 	[ ] 	
      (r) a registered charity under the Income Tax Act
      (Canada) that, in regard to the trade, has obtained advice from an
      eligibility advisor or an advisor registered under the securities
      legislation of the jurisdiction of the registered charity to give advice
      on the securities being traded;

- 4 -

	 	[ ] 	
      (s) an entity organized in a foreign jurisdiction that is
      analogous to any of the entities referred to in paragraphs (a) to (d) or
      paragraph (i) in form and function;

	 	 	 
	 	[ ] 	
      (t) a person in respect of which all of the owners of
      interests, direct, indirect or beneficial, except the voting securities
      required by law are persons or companies that are accredited
    investors;

	 	 	 
	 	[ ] 	
      (u) an investment funds that is advised by a person
      registered as an advisor or a person that is exempt from registration as
      an advisor; or

	 	 	 
	 	[ ] 	
      (v) a person that is recognized or designated by the
      securities regulatory authority or, except in Ontario and Québec, the
      regulator as (i) an accredited investor, or (ii) an exempt purchaser in
      Alberta or British Columbia after this instrument comes into
  force;

The Subscriber acknowledges and agrees that the Subscriber may
be required by the Company to provide such additional documentation as may be
reasonably required by the Company and its legal counsel in determining the
Subscriber's eligibility to acquire the Securities under relevant
legislation.

     IN WITNESS WHEREOF, the
undersigned has executed this Questionnaire as of the ________day of
__________________, ________.

	If an Individual: 	 	If a Corporation, Partnership or Other Entity:
    
	 	 	 
	Signature 	 	Print or Type Name of Entity 
	 	 	 
	Print or Type Name 	 	Signature of Authorized Signatory 
	 	 	 
	  	 	Type of Entityex4p28.htm

     

      
        

      
Exhibit 4.28

    
      

       

      

    

    SECOND
LIEN PLEDGE AND SECURITY AGREEMENT

     

    Dated as
of February 5, 2010,

     

    among

     

    CENVEO
CORPORATION,

     

    CENVEO,
INC.,

     

    and

     

    CERTAIN
OF THEIR SUBSIDIARIES

     

    party
hereto from time to time,

     

    as
Grantors,

     

    and

     

    WELLS
FARGO BANK, NATIONAL ASSOCIATION,

     

    as
Collateral Agent.

     

    
      

       

      

    

    

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    TABLE OF
CONTENTS

    
 

    
      
        	 
      	 
      	
                Page

              
	
                ARTICLE
      I

              
	 
      	 
      
	
                DEFINITIONS

              
	 
	
                SECTION
      1.01

              	
                Indenture
      Definitions and Construction

              	
                 2

              
	
                SECTION
      1.02

              	
                UCC
      Definitions

              	
                 2

              
	
                SECTION
      1.03

              	
                Other
      Defined Terms

              	
                 2

              
	 	 	 
	
                ARTICLE
      II

              
	 
      	 
      	 
      
	
                PLEDGED
      COLLATERAL

              
	 
	
                SECTION
      2.01

              	
                Pledged
      Collateral

              	
                11

              
	
                SECTION
      2.02

              	
                Delivery
      of the Pledged Collateral

              	
                12

              
	
                SECTION
      2.03

              	
                Agreements
      of Issuers

              	
                13

              
	
                SECTION
      2.04

              	
                Representations,
      Warranties and Covenants with respect to Pledged
Collateral

              	
                14

              
	
                SECTION
      2.05

              	
                Voting
      Rights; Dividends and Interest, etc.

              	
                16

              
	
                SECTION
      2.06

              	
                Registration
      in Nominee Name; Denominations

              	
                17

              
	 	 	 
	
                ARTICLE
      III

              
	 
      	 
      	 
      
	
                SECURITY
      INTERESTS IN PERSONAL PROPERTY

              
	 
	
                SECTION
      3.01

              	
                The
      Security Interests

              	
                17

              
	
                SECTION
      3.02

              	
                Filing
      Authorization

              	
                20

              
	
                SECTION
      3.03

              	
                Continuing
      Security Interest

              	
                20

              
	
                SECTION
      3.04

              	
                Grantors
      Remain Liable

              	
                21

              
	
                SECTION
      3.05

              	
                Security
      Interest Absolute

              	
                21

              
	
                SECTION
      3.06

              	
                Waiver
      of Subrogation

              	
                22

              
	
                SECTION
      3.07

              	
                Release;
      Termination

              	
                22

              
	 	 	 
	
                ARTICLE
      IV

              
	 
      	 
      	 
      
	
                PERFECTION
      OF SECURITY INTERESTS;

              
	
                REPRESENTATIONS
      AND WARRANTIES

              
	 
	
                SECTION
      4.01

              	
                Perfection
      of Security Interest

              	
                23

              
	
                SECTION
      4.02

              	
                Representations
      and Warranties

              	
                28

              

         

         

        
          
            
            

          

          
            -i-

            
              

            

          

          
            
            

          

        

         

         

         

        	 	 	
                Page

              
	
                 

              	 
      	 
      
	
                ARTICLE
      V

              
	 
      	 
      	 
      
	
                COVENANTS

              
	
                SECTION
      5.01

              	
                Perfection
      of Security Interests

              	
                28

              
	
                SECTION
      5.02

              	
                Covenants
      Regarding Patent, Trademark and Copyright Collateral

              	
                31

              
	 	 	 
	
                ARTICLE
      VI

              
	 
      	 
      	 
      
	
                REMEDIES;
      RIGHTS UPON DEFAULT

              
	 	 	 
	
                SECTION
      6.01

              	
                Remedies
      upon Default

              	
                33

              
	
                SECTION
      6.02

              	
                Application
      of Proceeds

              	
                35

              
	
                SECTION
      6.03

              	
                Grant
      of License to Use Intellectual Property

              	
                36

              
	
                SECTION
      6.04

              	
                Securities
      Act, etc.

              	
                36

              
	
                SECTION
      6.05

              	
                Actions
      of Collateral Agent

              	
                37

              
	 	 	 
	
                ARTICLE
      VII

              
	 
      	 
      	 
      
	
                MISCELLANEOUS

              
	
                SECTION
      7.01

              	
                Notices

              	
                37

              
	
                SECTION
      7.02

              	
                Amendments,
      etc.; Additional Grantors; Successors and Assigns

              	
                37

              
	
                SECTION
      7.03

              	
                Survival
      of Agreement

              	
                38

              
	
                SECTION
      7.04

              	
                Collateral
      Agent Appointed Attorney-in-Fact

              	
                38

              
	
                SECTION
      7.05

              	
                Counterparts

              	
                39

              
	
                SECTION
      7.06

              	
                Severability

              	
                39

              
	
                SECTION
      7.07

              	
                GOVERNING
      LAW; JURISDICTION; ETC.

              	
                39

              
	
                SECTION
      7.08

              	
                WAIVER
      OF JURY TRIAL

              	
                40

              
	
                SECTION
      7.09

              	
                ENTIRE
      AGREEMENT

              	
                41

              
	
                SECTION
      7.10

              	
                Mortgages

              	
                41

              
	
                SECTION
      7.11

              	
                No
      Waiver; Remedies

              	
                41

              
	
                SECTION
      7.12

              	
                Headings

              	
                41

              
	
                SECTION
      7.13

              	
                Permitted
      Additional Pari Passu Obligations

              	
                41

              
	
                SECTION
      7.14

              	
                Delivery
      to Collateral Agent Generally

              	
                42

              
	
                SECTION
      7.15

              	
                Subordination
      of Intercompany Notes

              	
                42

              
	
                SECTION
      7.16

              	
                Collateral
      Agent

              	
                44

              
	
                SECTION
      7.17

              	
                Indemnity
      and Expenses

              	
                47

              
	 
      	 
      	 
      

         

         

        
          
            
            

          

          
            -ii-

            
              

            

          

          
            
            

          

        

         

        	
                 

              	 
      	 
      
	
                Schedules

              	 
      	 
      
	 	 	 
	
                Schedule
      1

              	
                Subsidiary
      Grantors

              	 
      
	
                Schedule
      2

              	
                Commercial
      Tort Claims

              	 
      
	
                Schedule
      3

              	
                Place
      of Incorporation, Chief Executive Office and Principal Place of Business;
      Locations of Records of Receivables and General
      Intangibles

              	 
      
	
                Schedule
      4

              	
                Pledged
      Collateral

              	 
      
	
                Schedule
      5

              	
                Locations
      and Descriptions of Equipment, Inventory and Motor
Vehicles

              	 
      
	
                Schedule
      6

              	
                Trade
      Names, Division Names, etc.

              	 
      
	
                Schedule
      7

              	
                Required
      Filings and Recordings; Existing Liens

              	 
      
	
                Schedule
      8

              	
                Patents
      and Patent Applications

              	 
      
	
                Schedule
      9

              	
                Trademarks
      and Trademark Applications

              	 
      
	
                Schedule
      10

              	
                Copyrights
      and Copyright Applications

              	 
      
	
                Schedule
      11

              	
                Licenses
      and Material Contracts

              	 
      
	
                Schedule
      12

              	
                Deposit
      Accounts and Security Accounts

              	 
      
	
                Schedule
      13

              	
                Real
      Property and Leased Real Property

              	 
      
	 	 	 
	
                Exhibits

              	 
      	 
      
	 	 	 
	
                Exhibit
      A

              	
                Form
      of Perfection Certificate

              	 
      
	
                Exhibit
      B

              	
                Form
      of Security Agreement Supplement

              	 
      
	
                Exhibit
      C

              	
                Form
      of Acknowledgment and Agreement

              	 
      
	
                Exhibit
      D

              	
                Form
      of Waiver

              	 
      
	
                Exhibit
      E

              	
                Form
      of IP Security Agreement Supplement

              	 
      
	
                Exhibit
      F

              	
                Form
      of Intellectual Property Security Agreement

              	 
      

      

    
      
        
        

      

      
        -iii-

        
          

        

      

      
        
        

      

    

     

    This
SECOND LIEN PLEDGE AND SECURITY AGREEMENT dated as of February 5, 2010
(this “Agreement”), among
CENVEO, INC., a Colorado
corporation (“Holdings”), CENVEO CORPORATION, a Delaware
corporation (the “Issuer”), each other
Domestic Subsidiary (such term and the other capitalized terms used herein shall
have the meanings assigned thereto in Article I of this Agreement) of Holdings
identified on the signature pages hereof and each Domestic Subsidiary of
Holdings that hereafter becomes a party hereto from time to time pursuant to a
Joinder Agreement (all such Domestic Subsidiaries, the “Subsidiary Grantors”
and, together with Holdings and the Issuer, hereinafter collectively referred to
as the “Grantors”, and each
individually as a “Grantor”) and WELLS FARGO BANK, NATIONAL
ASSOCIATION, as collateral agent (in such capacity, together with its
successors and assigns, the “Collateral Agent”)
for the Secured Parties.

     

    RECITALS

     

    WHEREAS,
pursuant to the Indenture, dated as of the date hereof (as amended, amended and
restated, supplemented or otherwise modified from time to time, the “Indenture”), among
the Issuer, the Guarantors named therein and Wells Fargo Bank, National
Association, in its capacity as trustee under the Indenture (together with its
successors and assigns, the “Trustee”), the Issuer
is issuing $400,000,000 aggregate principal amount of 8.875% Senior Second Lien
Notes due 2018 (including any Additional Notes and Exchange Notes (each as
defined in the Indenture), the “Notes”);

     

    WHEREAS,
from time to time after the date hereof, the Issuer may, subject to the terms
and conditions of the Indenture and the Security Documents, incur Permitted
Additional Pari Passu Obligations (including Additional Notes issued under the
Indenture), that the Issuer desires to secure by the Collateral on a pari passu
basis with the Notes;

     

    WHEREAS,
pursuant to the guaranty of Holdings and the Subsidiary Grantors set forth in
Article 10 of the Indenture, Holdings and each Subsidiary Grantor have
guarantied the Secured Obligations of the Issuer under the Notes, the Indenture
and the Security Documents and will receive direct and indirect benefits from
the issuance of the Notes under the Indenture;

     

    WHEREAS,
it is a condition to the issuance of the Notes that each Grantor execute and
deliver this Agreement; and

     

    WHEREAS,
to obtain such benefits each Grantor is willing to grant a Lien on the
Collateral of such Grantor in favor of the Collateral Agent for the benefit of
the Secured Parties as collateral security for its Secured Obligations as
hereinafter provided;

     

    NOW
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, each Grantor hereby agrees, for the benefit of
each Secured Party, as follows:

     

    

    
      
        
           

        

        
           

          
            

          

        

        
           

        

      

    

    

    ARTICLE
I

     

    DEFINITIONS

     

    SECTION
1.01      Indenture Definitions and
Construction.

     

    (a)           Capitalized
terms used in this Agreement and not otherwise defined herein have the meanings
specified in Sections
1.01 and 1.02 of the
Indenture.

     

    (b)           The
rules of construction specified in Sections 1.03 and
1.04 of the
Indenture also apply to this Agreement.

     

    SECTION
1.02      UCC
Definitions.  All
terms defined in the UCC and not defined in this Agreement have the meanings
specified therein.

     

    SECTION
1.03      Other Defined
Terms.  As
used in this Agreement, the following terms have the meanings specified
below:

     

    “Account” means a
right to payment of a monetary obligation, whether or not earned by performance
(and shall include invoices, contracts, rights, accounts receivable, notes,
refunds, indemnities, interest, late charges, fees, undertakings, and all other
obligations and amounts owing to any Grantor from any Person): (a) for property
that has been or is to be sold, leased, licensed, assigned or otherwise disposed
of; (b) for services rendered or to be rendered; (c) for a policy of insurance
issued or to be issued; (d) for a secondary obligation incurred or to be
incurred; (e) for energy provided or to be provided; or (f) arising out of the
use of a credit or charge card or information contained on or for use with the
card.

     

    “Account Control
Agreement” means an account control agreement in substantially the same
form as the account control agreement with respect to the same bank entered into
by the Administrative Agent, or any other form reasonably satisfactory to the
Collateral Agent, entered into among a Grantor, the Collateral Agent and the
bank or Securities Intermediary where a Deposit Account or Securities Account,
respectively, of such Grantor is maintained.

     

    “Account Debtor” means
any Person who is or who may become obligated to any Grantor under, with respect
to or on account of an Account.

     

    “Acknowledgment and
Agreement” means an acknowledgment in the form of Exhibit C hereto, or
otherwise in form and substance reasonably acceptable to the Collateral Agent,
with respect to the collateral assignment by the applicable Grantor hereunder of
its rights under any Material Contract, duly executed by the other party or
parties to such Material Contract.

    

      “Additional Pari Passu
Agent” shall mean the Person appointed to act as trustee, agent or
representative for the holders of Permitted Additional Pari Passu Obligations
pursuant to any Additional Pari Passu Agreement.

       

      “Additional Pari Passu
Agreement” shall mean the indenture, credit agreement or other agreement
under which any Permitted Additional Pari Passu Obligations (other than
Additional Notes) are incurred and any notes or other instruments representing
such Permitted Additional Pari Passu Obligations.

    

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    “Additional Pari Passu Debt
Documents” shall mean any document or instrument executed and delivered
with respect to any Permitted Additional Pari Passu Obligations.

     

    “Additional Pari Passu
Joinder Agreement” shall mean an agreement substantially in the form of
Exhibit 6 hereto.

     

    “Administrative Agent”
shall mean (i) Bank of America, N.A., in its capacity as administrative agent
under the Credit Agreement, and its permitted successors and assigns or (ii) any
other First Lien Agent, as applicable, and shall include the Control
Agent.

     

    “Applicable Authorized
Representative” has the meaning specified in Section
6.05.

     

    “Chattel Paper” means
a record or records that evidence both a monetary obligation and a security
interest in specific goods, a security interest in specific goods and software
used in the goods, a security interest in specific goods and license of software
used in the goods, a lease of specific goods, or a lease of specific goods and
license of software used in the goods.

     

    “Collateral” has the
meaning specified in Section
3.01.

     

    “Collateral Agent” has
the meaning specified in the preamble hereto.

     

    “Commercial Tort
Claim” means a claim arising in tort with respect to which the claimant
is a Grantor.

     

    “Control Agent” has
the meaning specified in the Intercreditor Agreement.

     

    “Copyright License”
means any written agreement, now or hereinafter in effect, granting any right to
any third party under any Copyright now or hereafter owned by any Grantor or
that any Grantor otherwise has the right to license, or granting any right to
any Grantor under any Copyright now or hereafter owned by any third party, and
all rights of any Grantor under any such agreement.

     

    “Copyrights” means all
of the following now owned or hereafter acquired by any Grantor, (a) all
copyright rights in any work subject to the copyright laws of the United States
or any other country, whether as author, assignee, transferee or otherwise, and
(b) all registrations and applications for registration of any such copyright in
the United States or any other country, including registrations, recordings,
supplemental registrations and pending applications for regitration
in the United States Copyright Office, including those listed on Schedule 10 hereto
for such Grantor, as such schedule may be supplemented from time to
time.

       

      “Deposit Account”
means a demand, time, savings, passbook, or similar account (including all bank
accounts, collection accounts and concentration accounts, together with all
funds held therein and all certificates and instruments, if any, from time to
time representing or evidencing such accounts) maintained with a bank,
including, without limitation, all such accounts listed on Schedule 12 hereto,
as such schedule may be supplemented from time to time.

    

     

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    “Designated Event of
Default” means (i) an Event of Default described under Section 6.01(a), (b), (h) or
(i) of the Indenture or (ii) a corresponding Event of Default under any
Additional Pari Passu Agreement.

     

    “Discharge of First Lien
Obligations” has the meaning specified in the Intercreditor
Agreement.

     

    “Documents” means a
document of title or a receipt of the type described in Section 7-201(2) of the
UCC.

     

    “Domestic Subsidiary”
means any Subsidiary that is organized under the laws of any political
subdivision of the United States.

     

    “Electronic Chattel
Paper” means Chattel Paper evidenced by a record or records consisting of
information stored in an electronic medium.

     

    “Entitlement Holder”
means a Person identified in the records of a Securities Intermediary as the
Person having a Security Entitlement against the Securities
Intermediary.  If a Person acquires a Security Entitlement by virtue
of Section 8-501(b)(2) or (3) of the UCC, such Person is the Entitlement
Holder.

     

    “Equipment” means all
machinery, equipment in all its forms, wherever located, including, without
limitation, all repair equipment, office equipment, motor vehicles, furniture
and furnishings, all other property similar to the foregoing (including tools,
parts and supplies of every kind and description), components, parts and
accessories installed thereon or affixed thereto and all parts thereof, and all
Fixtures and all accessories, additions, attachments, improvements,
substitutions and replacements thereto and therefor.

     

    “Excluded Securities”
has the meaning specified in Section
2.01.

     

    “Federal Securities
Laws” has the meaning specified in Section
6.07.

     

    “Financial Asset”
means:

     

    (a)           a
Security;

     

    (b)           an
obligation of a Person or a share, participation or other interest in a Person
or in property or an enterprise of a Person, which is, or is of a type, dealt
with in or traded on
financial markets, or which is recognized in any area in which it is issued or
dealt in as a medium for investment; or

    
       

      (c)           any
property that is held by a Securities Intermediary for another Person in a
Securities Account if the Securities Intermediary has expressly agreed with the
other Person that the property is to be treated as a Financial Asset under
Article 8 of the UCC.  As the context requires, the term Financial
Asset means either the interest itself or the

      
 

      
        
          
          

        

        
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    means by
which a Person’s claim to it is evidenced, including a certificated or
uncertificated Security, a certificate representing a Security or a Security
Entitlement.

     

    “First Lien Security
Agreement” means the Pledge and Security Agreement dated as of June 21,
2006 among Holdings, the Issuer, the Subsidiary Grantors party thereto and Bank
of America, N.A., as the Administrative Agent, as the same may be amended,
restated, supplemented or otherwise modified from time to time.

     

    “Fixtures” means all
items of Goods, whether now owned or hereafter acquired, of any Grantor that
become so related to particular real property that an interest in them arises
under any real property law applicable thereto.

     

    “Foreign Subsidiary”
means a Subsidiary of Holdings that is a controlled foreign corporation under
section 957 of the Internal Revenue Code of 1986, as amended.

     

    “General Intangibles”
means all “General Intangibles” as defined in the UCC, including things in
action and all other intangible personal property of any Grantor of every kind
and nature (other than Accounts, Chattel Paper, Commercial Tort Claims, Deposit
Accounts, Documents, Goods, Instruments, Investment Property, Letter-of-Credit
Rights, Letters of Credit, and money) now owned or hereafter acquired by such
Grantor, including corporate, limited liability company, limited partnership or
other business records, indemnification claims, contract rights (including
rights under leases, whether entered into as lessor or lessee, Swap Contracts
and other agreements), Intellectual Property, Payment Intangibles and tax refund
claims.

     

    “Goods” means all
things that are movable when a security interest attaches (including (a)
Fixtures and (b) computer programs embedded in goods and any supporting
information provided in connection with a transaction relating to the program if
(i) the program is associated with the goods in such a manner that is
customarily considered part of the goods, or (ii) by becoming the owner of the
goods, a Person acquires a right to use the program in connection with the
goods).

     

    “Governmental License”
means, with respect to each Grantor, each license from a Governmental Authority
which is material to the conduct of the business of such Grantor as conducted on
the date hereof or as proposed to be conducted.

     

    “Grantors” has the
meaning specified in the preamble hereto.

     

    “Holdings” has the
meaning specified in the preamble hereto.

     

    

    “Instrument” means a
negotiable instrument or any other writing that evidences a right to the payment
of a monetary obligation, is not itself a security agreement or lease, and is of
a type that in ordinary course of business is transferred by delivery with any
necessary endorsement or assignment.

     

    “Intellectual
Property” means all intellectual and similar property of every kind and
nature now owned or hereafter acquired by any Grantor, including inventions,
designs, Patents, Copyrights, Licenses, Trademarks, trade secrets, domain names,
confidential or proprietary technical and business information, know-how,
show-how or other data or information, Software and databases and all
embodiments or fixations thereof and related documentation, goodwill,
registrations and franchises, and all additions, improvements and accessions to,
and books and records describing or used in connection with, any of the
foregoing.

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    “Intellectual Property
Security Agreement” means an agreement with respect to the security
interest granted by any Grantor pursuant to this Agreement in the Copyrights,
Patents or Trademarks of such Grantor which are registered under the federal
Laws of the United States of America or the Laws of any foreign country, which
agreement shall be in substantially the form of Exhibit F hereto and
otherwise in form for filing in the United States Patent and Trademark Office,
the United States Copyright Office or in the corresponding filing office under
the Laws of such foreign jurisdiction, as applicable, from such Grantor, as such
agreement may be amended, restated, amended and restated, supplemented or
otherwise modified from time to time.

     

    “Intercreditor
Agreement” means that certain Intercreditor Agreement, dated as of the
date hereof, among the Issuer, Holdings, the other Grantors from time to time
party thereto, Bank of America, N.A., in its capacity as the initial First Lien
Agent and Wells Fargo Bank, National Association, in its capacity as the initial
Second Lien Collateral Agent thereunder, as it may be amended, restated,
supplemented or otherwise modified from time to time in accordance with the
terms thereof.

     

    “Intercompany Notes”
means all promissory notes evidencing Indebtedness for borrowed money of
Holdings or any of its direct or indirect Subsidiaries to and in favor of any
Grantor.

     

    “Inventory” means
Goods, other than farm products, which: (a) are leased by a Person as lessor;
(b) are held by a Person for sale or lease or to be furnished under a contract
of service; (c) are furnished by a Person under a contract of service; or (d)
consist of raw materials, work in process, or materials used or consumed in a
business, and includes, without limitation, (i) finished goods, returned goods
and materials and supplies of any kind, nature or description which are or might
be used in connection with the manufacture, packing, shipping, advertising,
selling or finishing of any of the foregoing, (ii) all goods in which a Grantor
has an interest in mass or a joint or other interest or right of any kind
(including goods in which a Grantor has an interest or right as consignee),
(iii) all goods which are returned to or repossessed by any Grantor, and (iv)
all accessions thereto, products thereof and documents therefor.

     

    “Investment Property”
means all Securities (whether certificated or uncertificated), Security
Entitlements, Securities Accounts, Financial Assets, commodity contracts and
commodity accounts of each Grantor; provided, however, that
Investment Property shall not include any Securities
constituting Pledged Collateral and identified on Schedule 4 hereto, as
such Schedule may be supplemented from time to time.

       

    

    “IP Security Agreement
Supplement” means a supplement, in the form of Exhibit E hereto, to
the Intellectual Property Security Agreement executed delivered by each
applicable Grantor from time to time upon either (i) the acquisition of any
Copyrights, Patents or Trademarks by such Grantor or (ii) the execution of a
Joinder Agreement by such Grantor.

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    “Issue Date” shall
mean February 5, 2010.

     

    “Issuer” has the
meaning specified in the preamble hereto.

     

    “Letter-of-Credit
Right” means a right to payment or performance under a letter of credit,
whether or not the beneficiary has demanded or is at the time entitled to demand
payment or performance, but excludes the right of a beneficiary to demand
payment or performance under a letter of credit.

     

    “License” means any
Patent License, Trademark License, Copyright License or other license or
sublicense as to which any Grantor is now or hereafter a party.

     

    “Material Adverse
Effect” means (a) a material adverse change in, or a material adverse
effect upon, the operations, business, properties, liabilities (actual or
contingent) or condition (financial or otherwise) of the Grantors taken as a
whole; (b) a material impairment of the rights and remedies of the Collateral
Agent or any other Secured Party under the Indenture or any Security Document,
or of the ability of any Grantor to perform its obligations under the Indenture
or any Security Document to which it is a party; or (c) a material adverse
effect upon the legality, validity, binding effect or enforceability against any
Grantor of the Indenture or any Security Document to which it is a
party.

     

    “Motor Vehicles” means
all titled vehicles of any kind (including any trailers and
aircraft).

     

    “Organization
Documents” means, (a) with respect to any corporation, the certificate or
articles of incorporation and the bylaws (or equivalent or comparable
constitutive documents with respect to any non-U.S. jurisdiction); (b) with
respect to any limited liability company, the certificate or articles of
formation or organization and operating agreement; and (c) with respect to any
partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable governmental authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.

     

    “Patent License” means
any written agreement, now or hereafter in effect, granting to any third party
any right to make, use or sell any invention on which a Patent, now or hereafter
owned by any Grantor or that any Grantor otherwise has the right to license, is
in existence, or granting to any Grantor any right to make, use or sell any
invention on which a Patent, now or hereafter owned by any third party, is in
existence, and all rights of any Grantor under any such agreement.

     

    
      “Patents” means all
right, title and interest of any Person in and to all of the following, whether
now owned or hereafter acquired:

       

      (a)           all
letters patent of the United States or the equivalent thereof in any other
country, all registrations and recordings thereof, and all applications for
letters patent of the United States or the equivalent thereof in any other
country, including registrations, recordings and pending applications in the
United States Patent and Trademark Office or any similar offices in any other
country, including all such patents, registrations, recordings and applications
of the Grantors described on Schedule 8 hereto, as
such schedule may be supplemented from time to time; and

    

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    (b)           all
reissues, continuations, divisions, continuations-in-part, renewals or
extensions thereof and the inventions disclosed or claimed therein, including
the right to make, use, sell and/or offer to sell the inventions disclosed or
claimed therein.

     

    “Payment Intangible”
means a general intangible under which the account debtor’s principal obligation
is a monetary obligation.

     

    “Perfection
Certificate” means a certificate substantially in the form of Exhibit A hereto,
completed by the Holdings on behalf of itself and each other Grantor to include
the scheduled information contemplated by Exhibit A hereto with
respect to each Grantor.

     

    “Pledged Collateral”
has the meaning specified in Section
2.01.

     

    “Pledged Debt” has the
meaning specified in Section
2.01.

     

    “Pledged Equity” has
the meaning specified in Section
2.01.

     

    “Pledged Securities”
means any promissory notes (including Intercompany Notes), stock certificates or
instruments, certificates and other documents representing or evidencing any of
the Pledged Debt or Pledged Equity, as the case may be.

     

    “Proceeds” means the
following property:

     

    (a)           whatever
is acquired upon the sale, lease, license, exchange, or other disposition of the
Collateral;

     

    (b)           whatever
is collected on, or distributed on account of, the Collateral;

     

    (c)           rights
arising out of the Collateral; and

     

    (d)           to
the extent of the value of the Collateral and to the extent payable to the
debtor or the secured party, insurance payable by reason of the loss or
nonconformity of, defects or infringement of rights in, or damage to, the
Collateral.

     

    
      “Schedules” means the
schedules to this Agreement, as supplemented from time to time by a Security
Agreement Supplement.

       

      “Secured Obligations”
means any principal, premium, interest (including any interest accruing
subsequent to the filing of a petition in bankruptcy, reorganization or similar
proceeding at the rate provided for in the documentation with respect thereto,
whether or not such interest is an allowed claim under applicable state, federal
or foreign law), penalties, fees, indemnifications, reimbursements, damages and
other liabilities, and guarantees of payment of such principal, interest,
penalties, fees, indemnifications, reimbursements, damages and other
liabilities, payable

    

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    under any
of (i) the Indenture, the Notes (other than any Additional Notes except to the
extent constituting Permitted Additional Pari Passu Obligations) and the
Security Documents, including any fees, expenses, indemnities, payments and
other amounts payable to the Collateral Agent and Trustee under the Indenture
and the Security Documents, and (ii) any Additional Pari Passu Agreement
(including the Indenture with respect to Additional Notes) and other
documentation relating to any other Permitted Additional Pari Passu Obligations;
provided that
no obligations in respect of Permitted Additional Pari Passu Obligations (other
than Additional Notes) shall constitute “Secured Obligations” unless the
Additional Pari Passu Agent for the holders of such Permitted Additional Pari
Passu Obligations has executed an Additional Pari Passu Joinder Agreement in the
form of Exhibit
6 hereto and has become a party to the Intercreditor
Agreement.

     

    “Secured Parties”
shall mean, collectively, the Collateral Agent, the Trustee, the Holders, each
Additional Pari Passu Agent, and each holder of Permitted Additional Pari Passu
Obligations that constitute Secured Obligations.

     

    “Securities” means any
obligations of an issuer or any shares, participations or other interests in an
issuer or in property or an enterprise of an issuer which

     

    (a)           are
represented by a certificate representing a security in bearer or registered
form, or the transfer of which may be registered upon books maintained for that
purpose by or on behalf of the issuer;

     

    (b)           are
one of a class or series or by its terms is divisible into a class or series of
shares, participations, interests or obligations; and

     

    (c)           (i)
are, or are of a type, dealt with or traded on securities exchanges or
securities markets or (ii) are a medium for investment and by their terms
expressly provide that they are a security governed by Article 8 of the
UCC.

     

    “Securities Account”
means an account to which a Financial Asset is or may be credited in accordance
with an agreement under which the Person maintaining the account undertakes to
treat the Person for whom the account is maintained as entitled to exercise
rights that comprise the Financial Asset, including, without limitation, all
such accounts listed on Schedule 12 hereto,
as such schedule may be supplemented from time to time.

    

      “Security Agreement
Supplement” means a Supplement to this Agreement in the form of Exhibit C executed by
each additional Grantor and delivered to the Collateral Agent pursuant to Section 5.01(c) of
this Agreement.

       

      “Security
Entitlements” means the rights and property interests of an Entitlement
Holder with respect to a Financial Asset.

       

      “Security Interest”
has the meaning specified in Section
3.01.

    

    

    
      
        
          
             

            
              	 
      

            

             

             

          

           

        

        
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    “Security
Intermediary” means:

     

    (a)           a
clearing corporation; or

     

    (b)           a
Person, including a bank or broker, that in the ordinary course of its business
maintains Securities Accounts for others and is acting in that
capacity.

     

    “Software” means a
computer program and any supporting information provided in connection with a
transaction relating to the program, not including a computer program that is
included in the definition of Goods.

     

    “Subordinated
Indebtedness” has the meaning specified in Section
7.15.

     

    “Subsidiary Grantor”
has the meaning specified in the preamble hereto.

     

    “Supporting
Obligation” means a Letter-of-Credit Right or secondary obligation that
supports the payment or performance of an Account, Chattel Paper, Document,
General Intangible, Instrument or Investment Property, including, without
limitation, all security agreements, guaranties, leases and other contracts
securing or otherwise relating to any such Accounts, Chattel Paper, Documents,
General Intangible, Instruments or Investment Property, including Goods
represented by the sale or lease of delivery which gave rise to any of the
foregoing, returned or repossessed merchandise and rights of stoppage in
transit, replevin, reclamation and other rights and remedies of an unpaid
vendor, lienor or secured party.

     

    “Tangible Chattel
Paper” means Chattel Paper evidenced by a record or records consisting of
information that is inscribed on a tangible medium.

     

    “Termination Date”
means the date on which the liens and security interests of the Collateral Agent
are released in all Collateral pursuant to the terms of the
Indenture.

     

    “Trademark License”
means any written agreement, now or hereafter in effect, granting to any third
party any right to use any Trademark now or hereafter owned by any Grantor or
that any Grantor otherwise has the right to license, or granting to any Grantor
any right to use any Trademark now or hereafter owned by any third party, and
all rights of any Grantor under any such agreement.

     

    “Trademarks” means all
of the following now or hereafter owned by any Grantor, (a) all trademarks,
service marks, trade names, corporate names, company names, business names,
fictitious business names, trade styles, trade dress, logos, other source or
business identifiers, designs and general intangibles of like nature, now
existing or hereafter adopted or acquired, all registrations and recordings
thereof, and all applications filed in connection therewith, including
registrations and applications in the United States Patent and Trademark Office,
any State of the United States or any other country or any political subdivision
thereof, and all extensions or renewals thereof, including, without limitation,
those listed on Schedule 9 hereto, as
such schedule may be supplemented from time to time, (b) all goodwill associated
therewith and (c) all other assets, rights and interests that uniquely reflect
or embody such goodwill.

     

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    “Waiver Agreement”
means a waiver agreement with a landlord or bailee of a Grantor substantially in
the form of Exhibit
D hereto or otherwise in form and substance reasonably satisfactory to
the Collateral Agent, entered into among such landlord or bailee, as the case
may be, such Grantor and the Collateral Agent, as such agreement may be amended,
restated, amended and restated, supplemented or otherwise modified from time to
time.

     

     

    ARTICLE
II

     

    PLEDGED
COLLATERAL

     

    SECTION
2.01      Pledged
Collateral.  The
Collateral pledged by each Grantor under this Agreement shall include all of
such Grantor’s right, title and interest in, to and under the following Equity
Interests and Indebtedness now owned or hereafter acquired by such Grantor
(collectively, the “Pledged
Collateral”):

     

    (a)           Pledged
Equity.  (i) The shares of capital stock, membership interests,
limited partnership interests and other Equity Interests in any Person owned by
such Grantor on the Issue Date and listed opposite the name of such Grantor on
Schedule 4,
(ii) any other Equity Interests of any Person obtained in the future by such
Grantor and identified in a supplement to Schedule 4 attached
to a Security Agreement Supplement and (iii) the certificates representing all
such Equity Interests (collectively, the “Pledged Equity”);
provided, however, that the
Pledged Equity of any Grantor shall not include (A) more than 65% of the
aggregate issued and outstanding voting Equity Interests of any Foreign
Subsidiary owned directly by such Grantor, (B) Equity Interests of any Foreign
Subsidiary that is organized as an “unlimited liability company” in the Province
of Nova Scotia (a “Nova Scotia ULC”) or
(C) any Equity Interest in any Person which is evidenced by a Security or a
Security Entitlement which is maintained in a Securities Account.

     

    (b)           Pledged
Debt.  (i) The promissory notes (including Intercompany Notes)
and debt securities of any other Person owned by such Grantor on the Issue Date
and the loans and advances for money borrowed made by such Grantor to any other
Person which are outstanding on the Issue Date, in each case, which are listed
opposite the name of such Grantor on Schedule 4, (ii) any
promissory notes (including Intercompany Notes), debt securities, and loans or
advances for money borrowed in the future issued to or owed to such Grantor by
any other Person and identified in a supplement to Schedule 4 attached
to a Security Agreement Supplement and (iii) the promissory notes (including,
Intercompany Notes) and any other instruments as may hereafter be issued to
evidence such loans or advances for money borrowed (collectively, the “Pledged
Debt”).

     

    (c)           Distributions.  Subject
to Section 2.05, all payments of principal or interest, dividends, cash,
instruments and other property from time to time received, receivable or
otherwise distributed in respect of, in exchange for or upon the conversion of
the items referred to in clauses (a) and (b) above.

     

    (d)           Rights and
Privileges.  Subject to Section 2.05, all rights and privileges
of such Grantor with respect to the securities, instruments and other property
referred to in clauses (a), (b) and (c) above.

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    (e)           Proceeds.  All
Proceeds of any of the foregoing.

     

    Notwithstanding
anything herein to the contrary, in the event that Rule 3-16 of Regulation S-X
under the Securities Act requires (or is replaced with another rule or
regulation, or any other law, rule or regulation is adopted, which would
require) the filing with the SEC (or any other governmental agency) of separate
financial statements of any Grantor that is a Subsidiary of Holdings due to the
fact that such Subsidiary’s Equity Interests or other securities of such Grantor
secure the Notes affected thereby, then the Equity Interests and such other
securities of such Grantor (the “Excluded Securities”)
will automatically be deemed not to be part of the Pledged Collateral securing
the Notes affected thereby but only to the extent necessary to not be subject to
such requirement, only for so long as required to not be subject to such
requirement and only with respect to Secured Obligations affected
thereby.

     

    In the
event that Rule 3-16 of Regulation S-X under the Securities Act is amended,
modified or interpreted by the SEC to permit (or is replaced with another rule
or regulation, or any other law, rule or regulation is adopted, which would
permit) such Grantor’s Equity Interests and other securities to secure the Notes
in excess of the amount then pledged without the filing with the SEC (or any
other governmental agency) of separate financial statements of such Grantor,
then the Equity Interests and other securities of such Grantor will
automatically be deemed to be a part of the Pledged Collateral for the relevant
Notes but only to the extent necessary to not be subject to any such financial
statement requirement.

     

    (i) Upon
the acceleration of the Secured Obligations under the Notes in accordance with
the Indenture, or (ii) upon the request of the Collateral Agent at any other
time, the Issuer will provide to the Collateral Agent a list of Excluded
Securities.

     

    SECTION
2.02      Delivery of the Pledged
Collateral.

     

    (a)           Certificated
Collateral.  Each Grantor agrees promptly to deliver or cause
to be delivered to the Collateral Agent (or, prior to the Discharge of First
Lien Obligations, to the Administrative Agent for the benefit of the Collateral
Agent) any and all Pledged Securities representing any Pledged Equity or Pledged
Debt, as the case may be.

     

    (b)           Intercompany
Notes.  Each Grantor will cause any Indebtedness for borrowed
money owed to such Grantor by any other Grantor or by any other Subsidiary of
Holdings, in each case, to be evidenced by a duly executed Intercompany Note to
be pledged and delivered to the
Collateral Agent (or, prior to the Discharge of First Lien Obligations, to the
Administrative Agent for the benefit of the Collateral Agent) pursuant to the
terms hereof.

       

      (c)           Stock
Powers.  Upon delivery to the Collateral Agent (or, prior to
the Discharge of First Lien Obligations, to the Administrative Agent for the
benefit of the Collateral Agent), any Pledged Securities shall be accompanied by
stock powers, bond powers or other instruments of transfer duly executed in
blank by the applicable Grantor and such other instruments and documents as the
Collateral Agent may reasonably request.  Unless previously delivered
with this Security Agreement or any Security Agreement Supplement, as the case
may be, each delivery of Pledged Securities shall be accompanied by a schedule
describing the Pledged Collateral evidenced thereby, which schedule shall be
attached hereto as a supplement to Schedule 4 and
made

      
 

      
        
          
            
               

               

               

               

            

             

          

          
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    a part
hereof; provided that failure
to attach any such schedule hereto shall not affect the validity of such pledge
of such Pledged Securities.  Each schedule so delivered shall be in
form and substance reasonably acceptable to the Administrative Agent and the
Collateral Agent and shall supplement any prior schedules so
delivered.

     

    (d)           Uncertificated
Collateral.  With respect to any Pledged Equity owned by any
Grantor that constitutes an uncertificated security of a Subsidiary or Affiliate
of such Grantor, such Grantor will cause the issuer thereof (if, either
individually or together with Holdings and its other Affiliates, it controls
such issuer) or will use commercially reasonable efforts to cause such issuer
(if it does not so control such issuer) either (i) to register the Collateral
Agent (or, prior to the Discharge of First Lien Obligations, the Administrative
Agent) as the registered owner of such Pledged Equity or (ii) (A) to acknowledge
the security interest of the Collateral Agent in such Pledged Equity granted
hereunder, (B) to confirm to the Collateral Agent that it has not received
notice of any other Lien in such Pledged Equity (and has not agreed to accept
instructions from any other Person in respect of such Pledged Equity other than
the Administrative Agent and, after the Discharge of First Lien Obligations, the
Collateral Agent), other than the Lien in favor of the Administrative Agent and
(C) to agree in writing with such Grantor and the Collateral Agent that such
issuer will after the Discharge of First Lien Obligations comply with
instructions with respect to such Pledged Equity originated by the Collateral
Agent without further consent of such Grantor, such agreement to be in form and
substance reasonably satisfactory to the Collateral Agent.

     

    SECTION
2.03      Agreements of
Issuers.

     

    (a)           Acknowledgment and
Confirmation of Issuers.  Each Grantor that is the issuer of
any Pledged Equity owned by any other Grantor, hereby (i) acknowledges the
security interest of the Collateral Agent in such Pledged Equity granted by such
other Grantor hereunder, (ii) confirms that it has not received notice of
any other Lien as of the Issue Date in such Pledged Equity (and has not agreed
to accept instructions from any other Person in respect of such Pledged Equity
other than the Administrative Agent and the Collateral Agent), other than the
Lien in favor of the Administrative Agent, (iii) agrees that it will comply with
the instructions with respect to such Pledged Equity originated by the
Collateral Agent (or, prior to the Discharge of First Lien Obligations, the
Administrative Agent) without further consent of such other Grator and
(iv) otherwise agrees that it will be bound by the terms of this Agreement
relating to the Pledged Collateral issued by it.

       

      (b)           Partnerships and Limited
Liability Companies.  In the case of each Grantor which is a
partner in a partnership, limited liability company or other entity, such
Grantor hereby consents to the extent required by applicable Organization
Documents to the pledge by each other Grantor, pursuant to the terms hereof, of
the Pledged Equity in such partnership, limited liability company or other
entity, and upon the occurrence and during the continuance of an Event of
Default, to the transfer of such Pledged Equity to the Collateral Agent or its
nominee and to the substitution of the Collateral Agent or its nominee as the
substituted partner or member in such limited partnership, limited liability
company or other entity with all rights, powers and duties of a partner or a
general partner or a limited member, as the case may be.

    

     

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    SECTION
2.04      Representations, Warranties
and Covenants with respect to Pledged Collateral. The
Grantors represent, warrant and covenant to and with the Collateral Agent, for
the benefit of the Secured Parties, that:

     

    (a)           Equity
Interests.  Schedule 4 (as
supplemented from time to time by any Security Agreement Supplements) correctly
sets forth for each Grantor on and as of the Issue Date and as of the date of
each Security Agreement Supplement, (i) the percentage of the issued and
outstanding Equity Interests of each class of any other Person (other than a
Nova Scotia ULC) directly owned by such Grantor (and the aggregate outstanding
Equity Interests of such class of such issuer) and (ii) all Indebtedness for
borrowed money of any other Person and all other Indebtedness evidenced by a
promissory note or debt security issued by any other Person which is payable or
due to such Grantor; provided, however, that for
each class of Equity Interests with voting power of any Foreign Subsidiary
(other than a Nova Scotia ULC) which is owned directly by such Grantor, Schedule 4 (as so
supplemented) identifies only 65% of the aggregate outstanding Equity Interests
of such class of such Foreign Subsidiary (or any lesser percentage of the
aggregate outstanding Equity Interests of such issuer of such class owned
directly by such Grantor).

     

    (b)           Due Authorization and
Issuance.  All Pledged Equity and Pledged Debt issued by any
Subsidiary or Affiliate of Holdings to any Grantor has been, and to the extent
that any Pledged Equity or Pledged Debt is hereafter issued, such Pledged Equity
or Pledged Debt will be, upon such issuance, duly and validly issued by such
issuer and (i) in the case of such Pledged Equity, is fully paid and
nonassessable and (ii) in the case of such Pledged Debt, is the legal, valid and
binding obligation of such issuer;

     

    (1)           Title.  Each
Grantor (i) is the owner, beneficially and of record, of the Pledged Collateral
indicated on Schedule
4 (as supplemented by any Security Agreement Supplement from time to
time) as owned by such Grantor, (ii) holds the same free and clear of all Liens,
other than Liens created by this Agreement and Permitted Collateral Liens, (iii)
will make no assignment, pledge, hypothecation or transfer of, or create or
permit to exist any security interest in or other Lien on, the Pledged
Collateral, other than the Security Interest created by this Agreement,
Permitted Collateral Liens and other a signments and transfers permitted
pursuant to the Indenture, and (iv) will defend its title or interest hereto or
therein against any and all Liens (other than the Security Interest created by
this Agreement and other Permitted Collateral Liens), however arising, of all
Persons.

     

    (c)           Transferability of Pledged
Collateral.  Except for restrictions and limitations imposed by
the Indenture, this Security Agreement and the Intercreditor Agreement or
securities laws generally or for consents required and obtained in connection
herewith, the Pledged Collateral is and will continue to be freely transferable
and assignable, and none of the Pledged Collateral is or will be subject to any
option, right of first refusal, shareholders agreement, provision of any
Organization Document or contractual restriction of any nature that might
prohibit, impair, delay or otherwise affect the pledge of such Pledged
Collateral hereunder, the sale or disposition thereof pursuant hereto or the
exercise by the Collateral Agent of rights and remedies hereunder.

     

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    (d)           Validity of Security
Interest.  By virtue of the execution and delivery by each
Grantor of this Agreement or a Joinder Agreement, as the case may be, when all
Pledged Securities evidencing any Pledged Collateral of such Grantor are
delivered to the Collateral Agent (or, prior to the Discharge of First Lien
Obligations, to the Administrative Agent for the benefit of the Collateral
Agent) in accordance with this Agreement, the Collateral Agent for the benefit
of the Secured Parties, will obtain a valid and perfected second priority lien,
subject to Permitted Collateral Liens, upon and security interest in all Pledged
Collateral of such Grantor as security for the payment and performance of the
Secured Obligations of such Grantor.

     

    (e)           No
Violation.  Such Grantor is not in default in the payment of
any portion of any mandatory capital contribution, if any, required to be made
under any agreement to which such Grantor is a party relating to the Pledged
Equity pledged by it, and such Grantor is not in violation of any other
provisions of any such agreement to which such Grantor is a party, or otherwise
in default or violation thereunder.

     

    (f)           No
Defaults.  No Pledged Equity pledged by such Grantor is subject
to any defense, offset or counterclaim, nor have any of the foregoing been
asserted or alleged against such Grantor by any Person with respect thereto, and
on and as of the Issue Date and as of the date of each Security Agreement
Supplement and Joinder Agreement, there are no certificates, instruments,
documents or other writings (other than the Organization Documents and
certificates (if any) delivered to the Collateral Agent (or, prior to the
Discharge of First Lien Obligations, to the Administrative Agent for the benefit
of the Collateral Agent)) which evidence any Pledged Equity of such
Grantor.

     

    (g)           Notices.  Each
Grantor agrees to furnish to the Collateral Agent promptly upon receipt thereof
copies of all material notices, requests and other documents received by such
Grantor under or pursuant to the Pledged Equity and any other contract or
agreement included in the Pledged Collateral to which it is a party, and from
time to time (i) furnish to the Collateral Agent such information and reports
regarding the Pledged Equity and any such Pledged Collateral as the Collateral
Agent may reasonably request, and (ii) upon the reasonable request of the
Collateral Agent, make to any other party to the
Pledged Equity or any other contract or agreement included in the Pledged
Collateral such demands and requests for information and reports or for action
as the Grantor is entitled to make thereunder;

    
       

      (h)           No Termination or
Modifications (Pledged Equity).  No Grantor of a Pledged Equity
shall, except as otherwise permitted by the Indenture: (i) cancel or terminate
any Pledged Equity or any other contract or agreement included in the Pledged
Collateral to which it is a party or consent to or accept any cancellation or
termination thereof; (ii) amend or otherwise modify any such or any such
contract or agreement or give any consent, waiver, or approval thereunder; (iii)
waive any default under or breach of any such Pledged Equity or any such other
contract or agreement; or (iv) take any other action in connection with any such
Pledged Equity or any such other contract or agreement the taking or omission of
which could reasonably be expected to impair the value of the interest or rights
of such Grantor thereunder or that would impair the interest or rights of the
Collateral Agent.

    

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    SECTION
2.05      Voting Rights; Dividends and
Interest, etc.

     

    (a)           Unless
a Designated Event of Default shall have occurred and be
continuing:

     

    (i)       Each
Grantor shall be entitled to exercise any and all voting and/or other consensual
rights and powers inuring to an owner of Pledged Collateral or any part thereof
for any purpose consistent with the terms of this Agreement, the Indenture and
the Intercreditor Agreement; provided that such
rights and powers shall not be exercised in any manner that could reasonably be
expected to have a Material Adverse Effect.

     

    (ii)      The
Collateral Agent shall be deemed without further action or formality to have
granted to each Grantor all necessary consents relating to voting rights and
shall, if necessary, upon written request of a Grantor and at the sole cost and
expense of the Grantors, from time to time execute and deliver or cause to be
executed and delivered to such Grantor, all such instruments as Grantor may
reasonably request in order to permit such Grantor to exercise the voting and/or
other rights that it is entitled to exercise pursuant to subparagraph (i)
above.

     

    (iii)     Each
Grantor shall be entitled to receive, retain, and to utilize free and clear of
any Lien hereof, any and all dividends, interest, principal and other
distributions paid on or distributed in respect of the Pledged Collateral but
only if and to the extent that such dividends, interest, principal and other
distributions are not otherwise prohibited by the terms and conditions of the
Indenture, the Intercreditor Agreement and applicable Laws; provided that any
noncash dividends, interest, principal or other distributions that would
constitute Pledged Equity or Pledged Debt, whether resulting from a subdivision,
combination or reclassification of the outstanding Equity Interests of the
issuer of any Pledged Equity or received in exchange for any Pledged Debt or any
part thereof, or in redemption thereof, or as a result of any merger,
consolidation, acquisition or other exchange of assets to which such issuer may
be a party or otherwise, shall be and become part of
the Pledged Collateral, and, if received by any Grantor, shall not be commingled
by such Grantor with any of its other funds or property but shall be held
separate and apart therefrom, shall be held in trust for the benefit of the
Collateral Agent and shall be forthwith delivered to the Collateral Agent (or,
prior to the Discharge of First Lien Obligations, to the Administrative Agent
for the benefit of the Collateral Agent) as Pledged Collateral in the same form
as so received (with any necessary endorsement).

     

    
      (b)           Subject
to the Intercreditor Agreement, upon the occurrence and during the continuance
of a Designated Event of Default, all rights of any Grantor to dividends,
interest, principal or other distributions that such Grantor is authorized to
receive pursuant to paragraph (a)(iii) of
this Section
2.05 shall cease, and all such rights shall thereupon become vested in
the Collateral Agent, which shall have the sole and exclusive right and
authority to receive and retain such dividends, interest, principal or other
distributions.  All dividends, interest, principal or other
distributions received by any Grantor contrary to the provisions of this Section 2.05 shall be
held in trust for the benefit of the Collateral Agent, shall be segregated from
other property or funds of

        
          
            
              

              
                	 
      

              

               

               

            

             

          

          
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    such
Grantor and shall be forthwith delivered to the Collateral Agent in the same
form as so received (with any necessary endorsement).  Any and all
money and other property paid over to or received by the Collateral Agent
pursuant to the provisions of this subsection (b) shall
be retained by the Collateral Agent in an account to be established by the
Collateral Agent upon receipt of such money or other property and shall be
applied in accordance with the provisions of Section
6.02.

     

    (c)           Subject
to the Intercreditor Agreement, upon the occurrence and during the continuance
of a Designated Event of Default, all rights of any Grantor to exercise the
voting and consensual rights and powers it is entitled to exercise pursuant to
paragraph
(a)(i) of this Section 2.05, and the
obligations of the Collateral Agent under paragraph (a)(ii) of
this Section
2.05, shall cease, and all such rights shall thereupon become vested in
the Collateral Agent, which shall have the sole and exclusive right and
authority to exercise such voting and consensual rights and
powers.  If after the occurrence of a Designated Event of Default,
such Event of Default shall have been waived pursuant to Article 9 of the
Indenture, each Grantor will again have the right to exercise the voting and
consensual rights and powers that such Grantor would otherwise be entitled to
exercise pursuant to the terms of paragraph (a)(i)
above.

     

    SECTION
2.06      Registration in Nominee
Name; Denominations.  The
Collateral Agent, on behalf of the Secured Parties (or, prior to the Discharge
of First Lien Obligations, the Administrative Agent for the benefit of the
Collateral Agent), shall have the right to hold as collateral the Pledged
Collateral endorsed or assigned in blank or in favor of the Collateral Agent
(or, prior to the Discharge of First Lien Obligations, the Administrative Agent
for the benefit of the Collateral Agent).  After the occurrence and
during the continuance of an Event of Default, the Collateral Agent, on behalf
of the Secured Parties (or, prior to the Discharge of First Lien Obligations, to
the Administrative Agent for the benefit of the Collateral Agent), shall also
have the right (in its sole and absolute discretion), to hold the Pledged
Collateral in its own name as pledgee, the name of its nominee (as pledgee or as
sub-agent) or the name of the applicable Grantor. At the request of the
Collateral Agent, each Grantor will promptly give to the Collateral Agent copies
of any notices or other communications received by it with
respect to Pledged Securities registered in the name of such
Grantor.  The Collateral Agent shall at all times have the right to
exchange the certificates or instruments (to the extent permitted by the terms
thereof) representing Pledged Securities then in its possession for certificates
or instruments of smaller or larger denominations for any purpose consistent
with this Agreement.

     

    
      ARTICLE
III

       

      SECURITY
INTERESTS IN PERSONAL PROPERTY

       

      SECTION
3.01      The Security
Interests.  Each
Grantor hereby collaterally assigns (except with respect to intent-to-use
trademark applications, if any) and pledges to the Collateral Agent, its
successors and assigns, for the ratable benefit of the Secured Parties, and
hereby grants to the Collateral Agent, its successors and assigns, for the
ratable benefit of the Secured Parties, as security for the payment or
performance in full of the Secured Obligations of such Grantor, a security
interest (the “Security Interest”)
in all right, title and interest of such Grantor in, to and under any and all of
the following assets and properties now owned or at any time
hereafter

       

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    acquired
by such Grantor or in which such Grantor now has or at any time in the future
may acquire any right, title or interest (collectively, the “Collateral”):

     

    (a)           all
Accounts;

     

    (b)           all
Chattel Paper;

     

    (c)           all
cash and Deposit Accounts;

     

    (d)           all
Documents;

     

    (e)           all
Equipment, including all Fixtures;

     

    (f)           all
General Intangibles;

     

    (g)           all
Instruments;

     

    (h)           all
Inventory;

     

    (i)           all
Investment Property;

     

    (j)           all
Pledged Collateral;

     

    (k)           all
Supporting Obligations;

     

    (l)           all
Commercial Tort Claims of such Grantor described in Schedule 2 hereto in
respect of such Grantor (as such schedule may be supplemented from time to time
pursuant to any Security Agreement Supplement or otherwise);

     

    
      (m)           all
other Goods;

       

      (n)           all
books and records pertaining to the Collateral;

       

      (o)           all
other assets, properties and rights of every kind and description and interests
therein, including all moneys, securities and other property, now or hereafter
held or received by, or in transit to, any Grantor, the Collateral Agent or any
other Secured Party, whether for safekeeping, pledge, custody, transmission,
collection or otherwise; and

       

      (p)           all
Proceeds of any and all of the foregoing;

       

      provided, however, that
notwithstanding anything to the contrary in clauses (a) through (p)
above:

       

      (i)       any
General Intangible, Chattel Paper, Instrument or Account which by its terms
prohibits the creation of a security interest therein (whether by assignment or
otherwise) shall be excluded from the Lien of the Security Interest granted
under this Section
3.01, and shall not be included in the Collateral of such Grantor, except
to the extent that 

    

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    Sections
9-406(d), 9-407(a) or 9-408(a) of the UCC are effective to render any such
prohibition ineffective; provided, however, that if any
General Intangible, Chattel Paper, Instrument or Account included in the
Collateral contains any term restricting or requiring the consent of any Person
(other than a Grantor) obligated thereon to any exercise of remedies hereunder
in respect of the Security Interest therein granted under this Section 3.01, then
the enforcement of such Security Interest under this Agreement shall be subject
to Section
6.01(c) (but such provision shall not limit the creation, attachment or
perfection of the Security Interest hereunder);

     

    (ii)      any
permit, lease, license (including any License) or franchise shall be excluded
from the Lien of the Security Interest granted under this Section 3.01, and
shall not be included in the Collateral, to the extent any Law applicable
thereto is effective to prohibit the creation of a Security Interest therein;
and

     

    (iii)     any
Equipment (including  any Software incorporated herein) owned by any
Grantor on the date hereof or hereafter acquired that is subject to a Lien
securing a purchase money obligation or Capitalized Lease permitted to be
incurred pursuant to the provisions of the Indenture shall be excluded from the
Lien of the Security Interest granted under this Section 3.01, and
shall not be included in the Collateral, to the extent that the contract or
other agreement in which such Lien is granted (or the documentation providing
for such purchase money obligation or Capitalized Lease) validly prohibits the
creation of any other Lien on such Collateral.

     

    With
respect to property described in clauses (i) through (iii) above to the extent
not included in the Collateral of such Grantor (the “Excluded Property”),
such property shall constitute Excluded Property only to the extent and for so
long as the creation of a Lien on such property in favor of the Collateral Agent
is, and remains, validly prohibited, and upon termination of such prohibition
(however occurring), such property shall cease to constitute Excluded
Property.  The Grantors
may be required from time to time at the request of the Collateral Agent to give
written notice to the Collateral Agent identifying in reasonable detail the
Excluded Property (and stating in such notice that such property constitutes
Excluded Property) and to provide the Collateral Agent with such other
information regarding the Excluded Property as the Collateral Agent may
reasonable request.

     

    
      Notwithstanding
anything herein to the contrary, the lien and security interest granted to the
Collateral Agent pursuant to this Agreement and the exercise of certain rights
and remedies by the Collateral Agent hereunder are subordinated and subject to
the provisions of the Intercreditor Agreement.  In the event of any
conflict between the terms of the Intercreditor Agreement and this Agreement,
the terms of the Intercreditor Agreement shall govern and control; provided that
nothing in the Intercreditor Agreement, as between the Collateral Agent, the
other Second Lien Claimholders (as defined in the Intercreditor Agreement) and
the Grantors, shall be deemed to waive any rights, protections, privileges,
immunities or indemnities of the Collateral Agent
as set forth in the Indenture and the Security
Documents.  Notwithstanding anything herein to the contrary, prior to
the Discharge of First Lien Obligations, the requirements of this Agreement to
deliver Pledged Collateral and Collateral and any certificates, instruments or
Documents in relation thereto to the Collateral Agent shall be deemed satisfied
by delivery of such Collateral and

      
 

      
        
          
            
              

              
                	 
      

              

               

               

            

             

          

          
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    such
certificates, instruments or Documents in relation thereto to the Administrative
Agent (as bailee for the Collateral Agent).  Each Grantor shall
provide a prompt written notice to the Collateral Agent describing all
certificates, instruments, Documents or other Collateral delivered to the
Administrative Agent pursuant to the immediately preceding sentence.

     

    SECTION
3.02     Filing
Authorization.

     

    (a)           Each
Grantor hereby irrevocably authorizes the Collateral Agent at any time and from
time to time to file in any relevant jurisdiction any initial financing
statements (including fixture filings) with respect to the Collateral or any
part thereof and amendments thereto that contain the information required by
Article 9 of the UCC of each applicable jurisdiction for the filing of any
financing statement or amendment, including (i) if such Grantor is an
organization, the type of organization and any organizational identification
number issued to such Grantor, (ii) in the case of a financing statement filed
as a fixture filing, a sufficient description of the real property to which such
Collateral relates and (iii) a description of collateral that describes such
property in any other manner as is necessary or as the Collateral Agent may
reasonably determine is necessary or advisable to ensure the perfection of the
security interest in the Collateral granted to the Collateral Agent, including
describing such property as “all assets” or “all property.”  Each
Grantor agrees to provide such information to the Collateral Agent promptly upon
request.

     

    (b)           Each
Grantor also ratifies its authorization for the Collateral Agent to file in any
relevant jurisdiction any such initial financing statements or amendments
thereto if filed prior to the date hereof.

     

    (c)           The
Collateral Agent is further authorized to file with the United States Patent and
Trademark Office or United States Copyright Office (or any successor office or
any similar office in
any other country) Intellectual Property Security Agreements or such other
documents as may be necessary or advisable for the purpose of perfecting,
confirming, continuing, enforcing or protecting the Security Interest granted by
each Grantor, without the signature of any Grantor, and naming any Grantor or
the Grantors as debtors and the Collateral Agent as secured party.

     

    (d)           Notwithstanding
the foregoing authorizations, in no event shall the Collateral Agent be
obligated to prepare or file any financing statements whatsoever, or to maintain
the perfection of the security interest granted hereunder.  Each
Grantor agrees to prepare, record and file, at its own expense, financing
statements (and continuation statements when applicable) with respect to the
Collateral now existing or hereafter created meeting the requirements of
applicable state law in such manner and in such jurisdictions as are necessary
to perfect and maintain perfected the Collateral, and to deliver a filed stamped
copy of each such financing statement or other evidence of filing to the
Collateral Agent.  Neither the Trustee nor the Collateral Agent shall
be under any obligation whatsoever to file any such financing or continuation
statements or to make any other filing under the UCC in connection with this
Agreement.

     

    SECTION
3.03      Continuing Security
Interest.  This
Agreement shall create a continuing security interest in the Collateral of each
Grantor and shall remain in full force and effect with respect to each Grantor
until the Termination Date for such Grantor, be binding upon each Grantor, its
successors, transferees and assigns, and inure, together with the rights and
remedies

     

     

    
      
        
        

      

      
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    of the
Collateral Agent hereunder, to the benefit of the Collateral Agent and each
other Secured Party.

     

    SECTION
3.04      Grantors Remain
Liable.  Anything
herein to the contrary notwithstanding:

     

    (a)           each
Grantor shall remain liable under the contracts and agreements included in the
Collateral (including the Material Contracts) to the extent set forth therein,
and shall perform all of its duties and obligations under such contracts and
agreements to the same extent as if this Agreement had not been
executed,

     

    (b)           each
Grantor will comply in all material respects with all Laws relating to the
ownership and operation of the Collateral, including all registration
requirements under applicable Laws, and shall pay when due all taxes, fees and
assessments imposed on or with respect to the Collateral, except to the extent
the validity thereof is being contested in good faith by appropriate proceedings
for which adequate reserves in accordance with GAAP have been set aside by such
Grantor,

     

    (c)           the
exercise by the Collateral Agent of any of its rights hereunder shall not
release any Grantor from any of its duties or obligations under any such
contracts or agreements included in the Collateral, and

     

    (d)           neither
the Collateral Agent nor any other Secured Party shall have any obligation or
liability under any such contracts or agreements included in the Collateral
by
reason of this Agreement, nor shall the Collateral Agent or any other Secured
Party be obligated to perform any of the obligations or duties of any Grantor
thereunder or to take any action to collect or enforce any claim for payment
assigned hereunder.

    

       

      SECTION
3.05      Security Interest
Absolute.  All
rights of the Collateral Agent and the security interests granted to the
Collateral Agent hereunder, and all obligations of each Grantor hereunder, shall
be absolute and unconditional, irrespective of any of the following conditions,
occurrences or events:

       

      (a)           any
lack of validity or enforceability of any Security Document, any Note or the
Indenture;

       

      (b)           the
failure of any Secured Party to assert any claim or demand or to enforce any
right or remedy against Holdings, the Issuer, any other Grantor or any other
Person under the provisions of any Security Document, any Note or the Indenture
or otherwise or to exercise any right or remedy against any other guarantor of,
or collateral securing, any Secured Obligation;

       

      (c)           any
change in the time, manner or place of payment of, or in any other term of, all
or any of the Secured Obligations or any other extension, compromise or renewal
of any Secured Obligation, including any increase in the Secured Obligations
resulting from the extension of additional credit to any Grantor or any other
obligor or otherwise;

    

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    (d)           any
reduction, limitation, impairment or termination of any Secured Obligation for
any reason, including any claim of waiver, release, surrender, alteration or
compromise, and shall not be subject to (and each Grantor hereby waives any
right to or claim of) any defense or setoff, counterclaim, recoupment or
termination whatsoever by reason of the invalidity, illegality, nongenuineness,
irregularity, compromise, unenforceability of, or any other event or occurrence
affecting, any Secured Obligation or otherwise;

     

    (e)           any
amendment to, rescission, waiver, or other modification of, or any consent to
departure from, any of the terms of any Security Document, any Note or the
Indenture;

     

    (f)           any
addition, exchange, release, surrender or non-perfection of any collateral
(including the Collateral), or any amendment to or waiver or release of or
addition to or consent to departure from any guaranty, for any of the Secured
Obligations; or

     

    (g)           any
other circumstances which might otherwise constitute a defense available to, or
a legal or equitable discharge of, Holdings, Issuer, any other Grantor or
otherwise.

     

    SECTION
3.06      Waiver of
Subrogation. Until
the Termination Date, no Grantor shall exercise any claim or other rights which
it may now or hereafter acquire against any other Grantor that arises from the
existence, payment, performance or enforcement of such Grantor’s Secured
Obligations under this Agreement, including any right of subrogation,
reimbursement, exoneration or indemnification, any right to participate in any
claim or remedy against any other Grantor or any collateral which the Collateral
Agent now has or hereafter acquires, whether or not such claim, remedy or right
arises in equity or under contract, statute or common law, including the right
to take or receive from any other Grantor, directly or indirectly, in cash or
other property or by setoff or in any manner, payment or security on account of
such claim or other rights.  If any amount shall be paid to any
Grantor in violation of the preceding sentence, such amount shall be deemed to
have been paid for the benefit of the Secured Parties, and, subject to the terms
of the Intercreditor Agreement, shall forthwith be paid to the Collateral Agent
to be credited and applied upon the Secured Obligations, whether matured or
unmatured.  Each Grantor acknowledges that it will receive direct and
indirect benefits for the financing arrangements contemplated by the Security
Documents, the Indenture and the Notes and that the agreement set forth in this
Section is knowingly made in contemplation of such benefits.

    
       

      SECTION
3.07      Release;
Termination.

       

      (a)           Upon
the release of any item of Collateral of any Grantor in accordance with Section 12.03 of the
Indenture, the Collateral Agent will, at such Grantor’s expense and without any
representations, warranties or recourse of any kind whatsoever, execute and
deliver to such Grantor such documents as such Grantor shall reasonably request
to evidence the release of such item of Collateral from the assignment and
security interest granted hereby; provided, however, that (i)
such Grantor shall have delivered to the Collateral Agent, at least five
Business Days prior to the date of the proposed release, a written request for
release describing the item of Collateral and, if applicable, the terms of the
sale, lease, transfer or other disposition giving rise 

    

     

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    to such
release in reasonable detail, including the price thereof and any expenses in
connection therewith, together with a form of release for execution by the
Collateral Agent (which release shall be in form and substance reasonably
satisfactory to the Collateral Agent) and a certificate of such Grantor to the
effect that the transaction is in compliance with the Security Documents and the
Indenture and as to such other matters as the Collateral Agent may reasonably
request and (ii) the proceeds of any such sale, lease, transfer or other
disposition required to be applied, or any payment to be made in connection
therewith, in accordance with Section 4.07 of the
Indenture shall, to the extent so required, be paid or made to, or in accordance
with the instructions of, the Collateral Agent when and as required under Section 4.07 of the
Indenture.

     

    (b)           Upon
the release of any Grantor pursuant to Section 10.05 of the
Indenture, the pledge, assignment and security interest granted by such Grantor
hereunder shall automatically terminate and all rights to the Collateral of such
Grantor shall revert to such Grantor.  Upon any such termination, the
Collateral Agent will, at the applicable Grantor’s expense and without any
representations, warranties or recourse of any kind whatsoever, execute and
deliver to such Grantor such documents as such Grantor shall reasonably request
to evidence such termination and deliver to such Grantor all Pledged Securities,
Instruments, Tangible Chattel Paper and negotiable
documents representing or evidencing the Collateral of such Grantor then held by
the Collateral Agent.

     

     

    ARTICLE
IV

     

    PERFECTION
OF SECURITY INTERESTS;

    REPRESENTATIONS
AND WARRANTIES

     

    Each
Grantor represents and warrants to the Collateral Agent and the Secured Parties
and agrees that:

     

    SECTION
4.01      Perfection of Security
Interest.

     

    (a)           UCC
Filings.  Uniform Commercial Code financing statements
(including fixture filings, as applicable) or other appropriate filings,
recordings or registrations containing a description of the Collateral have been
prepared by the Grantors based upon the information provided to the Collateral
Agent in Schedule
7 hereto (as supplemented from time to time) and have been delivered to
the Collateral Agent for filing in each governmental office specified in Schedule 7 hereto,
and constitute all the filings, recordings and registrations that are necessary
to publish notice of and protect the validity of and to establish a valid and
perfected security interest in favor of the Collateral Agent (for the ratable
benefit of the Secured Parties) in Collateral in which the Security Interest may
be perfected by filing, recording or registration in the United States (or any
political subdivision thereof) and its territories and possessions, and no
further or subsequent filing, re-filing, recording, rerecording, registration or
re-registration is necessary in any such jurisdiction, except as
follows:

     

      
(i)       filings required to be made in or
with the United States Patent and Trademark Office and the United States
Copyright Office in order to perfect the Security Interest in Collateral
consisting of United States Patents, Trademarks and Copyrights;

     

     

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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      (ii)    filings
required to be made in or with the motor vehicle title records of any applicable
state in order to perfect the Security Interest in Collateral consisting of
motor vehicles registered in such state; and

     

    (iii)    
filings with respect to Real Property assets excluded from the scope of UCC
Article 9 pursuant to UCC Section 9-109.

     

    (b)           Schedules.  The
Schedules hereto (as supplemented from time to time by a Security Agreement
Supplement) have been duly prepared and completed and are correct and complete
and:

     

      
(i)    Schedule 1 sets forth
a true and complete list of all the Subsidiary Grantors;

    

     
(ii)    Schedule 2 sets forth
a true and complete list of all Commercial Tort Claims of each
Grantor;

     

    (iii)     Schedule 3 sets forth
a true and complete list of the exact legal name, jurisdiction of organization,
chief executive office, principal place(s) of business, locations of records of
each Grantor, as well as any prior legal names, jurisdictions of formation or
locations within the past 5 years of each such Grantor;

     

     (iv)    Schedule 4 sets forth
a true and complete list of all Pledged Collateral of each Grantor in accordance
with Section
2.01;

     

     
(v)     Schedule 5 sets forth
a true and complete list of locations of and, with respect to Motor Vehicles,
description of all Equipment, Inventory and Motor Vehicles of each
Grantor;

    
    

     (vi)    Schedule 6 sets forth
a true and complete list of trade and division names of each Grantor and a true
and complete organizational chart of Holdings including all of the
Grantors;

     

    (vii)    Schedule 7 sets forth
a true and complete list of all the filings, including governmental offices, in
which UCC filings should be made in accordance with Section 4.01(a) and
all existing liens of each Grantor as of the Issue Date or the date of any
Security Agreement Supplement, as applicable;

     

                                       
(viii)    Schedule 8 sets forth
a true and complete list of all the Patents of each Grantor;

     

     (ix)    Schedule 9 sets forth
a true and complete list of all the Trademarks and Trademark applications of
each Grantor;

     

     
(x)    Schedule 10 sets
forth a true and complete list of all Copyrights and Copyright applications of
each Grantor;

    
 

    
      
        
          
            
              

              
                	 
      

              

               

               

            

             

          

          
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     (xi)    Schedule 11 sets
forth a true and complete list of all Licenses, Governmental Licenses and other
Material Contracts of each Grantor;

     

    (xii)    Schedule 12 sets
forth a true and complete list of all Deposit Accounts and Securities Accounts
of each Grantor; and

     

    (xiii)  
Schedule 13
sets forth a true and complete list of all owned real property of each Grantor
and all real property leases under which any Grantor is a lessee or
lessor.

     

    (c)           Perfection
Certificate.  As of the Issue Date, the Perfection Certificate
delivered to the Collateral Agent has been duly prepared and completed and the
information set forth therein for each Grantor is correct and
complete.

     

    

    (d)           Intellectual Property
Filings.  Fully executed Intellectual Property Security
Agreements containing a description of all Collateral consisting of Intellectual
Property with respect to United States registered Patents (and Patents for which
United States registration applications are pending), United States registered
Trademarks (and Trademarks for which United States registration applications are
pending), and United States registered Copyrights (and Copyrights for which
United States registration applications are pending), in each case, as more
particularly described in Schedules 8, 9 and 10, have been
delivered to the Collateral Agent for recording with the United States Patent
and Trademark Office and the United States Copyright Office pursuant to 35
U.S.C. Section 261, 15 U.S.C. Section 1060 or 17 U.S.C. Section 205 and the
regulations thereunder, as applicable.  Upon such filings, no further
or subsequent filing, re-filing, recording, rerecording, registration or
re-registration shall be necessary to protect the validity of and to establish a
valid and perfected security interest in favor of the Collateral Agent (for the
ratable benefit of the Secured Parties) in respect of all such Intellectual
Property.

     

    (e)           Motor
Vehicles.  Upon the request of (i) after the Discharge of First
Lien Obligations, the Collateral Agent or (ii) prior to the Discharge of First
Lien Obligations, the Administrative Agent, each Grantor shall deliver to the
Collateral Agent (or, prior to the Discharge of First Lien Obligations, to the
Control Agent, for the benefit of the Collateral Agent) originals of the
certificates of title or ownership for the motor vehicles (and any other
Equipment covered by certificates of title or ownership) owned by it and which
are more particularly described in Schedule 5, in each
case, with the Collateral Agent (or, prior to the Discharge of First Lien
Obligations, with the Control Agent) listed as lienholder therein.

     

    (f)           Instruments and Tangible
Chattel Paper.  If any amount payable under or in connection
with any of the Collateral shall be or become evidenced by any promissory note
or other instrument, or if any Grantor shall at any time hold or acquire any
Instruments (other than any Instruments evidencing Indebtedness for money
borrowed comprising part of the Pledged Collateral which has been delivered to
the Collateral Agent (or, prior to the Discharge of First Lien Obligations, to
the Administrative Agent for the benefit of the Collateral Agent) pursuant to
Section 2.02)
or Tangible Chattel Paper, such Grantor shall forthwith endorse, assign and
deliver the same to the Collateral Agent (or, prior to the Discharge of First
Lien Obligations, to the Administrative Agent, for the benefit of the Collateral
Agent) accompanied by such instruments of transfer or assignment duly executed
in blank as the Collateral Agent (or, prior to the Discharge of First Lien
Obligations, the Administrative Agent) may from time to time reasonably request,
except to the extent, prior to the Discharge of First Lien Obligations, the
Administrative Agent has not requested the delivery of such
Collateral.

     

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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      (g)           Deposit
Accounts.  Each Grantor shall enter into an Account Control
Agreement with each depositary bank with which such Grantor from time to time
opens or maintains a Deposit Account (other than (i) Deposit Accounts used for
payroll purposes, payroll taxes or withholding taxes, (ii) any other Deposit
Account where the balance on deposit therein does not at any time exceed
$100,000 (so long as the amount on deposit at any time in all such other Deposit
Accounts does not exceed $1,000,000 in the aggregate and (iii) prior to the
Discharge of First Lien Obligations, any other Deposit Account that is not
subject to a control agreement for the benefit of the Administrative Agent) to
cause the depositary bank to agree to comply at any time with instructions from
the Collateral Agent to such depositary bank directing the disposition of
funds
from time to time credited to such Deposit Account, without further consent of
such Grantor or any other Person, pursuant to such Account Control Agreement;
provided that
prior to the Discharge of First Lien Obligations and for 60 days following the
Discharge of First Lien Obligations the requirements of this Section 4.01(g)
shall be satisfied by the Administrative Agent, including the Control Agent,
entering into a control agreement with respect to any such Deposit Account for
the benefit of the Secured Parties.  The Collateral Agent agrees with
each Grantor that the Collateral Agent shall not give any such instructions
pursuant to any such Account Control Agreement, unless a Designated Event of
Default has occurred and is continuing.  No Grantor shall grant
control of any Deposit Account to any Person other than the Collateral Agent and
the Administrative Agent.

    

     

    (h)           Investment
Property.  If any Securities, other than any Pledged Equity
issued by a Grantor or any other Subsidiary of Holdings and pledged pursuant to
Article II,
whether certificated or uncertificated, or other Investment Property now or
hereafter acquired by any Grantor are held by such Grantor or its nominee
through a Securities Intermediary, such Grantor shall immediately notify the
Collateral Agent thereof and, pursuant to an Account Control Agreement, cause
such Securities Intermediary to agree to comply with entitlement orders or other
instructions from the Collateral Agent to such Securities Intermediary as to
such Securities or other Investment Property held in a securities account, in
each case without further consent of any Grantor or such nominee (other than
with respect to (i) any securities accounts where the market value of the
Securities and other Investment Property on deposit therein does not at any time
exceed $100,000 (so long as the market value of the Securities and other
Investment Property on deposit at any time in all such securities accounts does
not exceed $1,000,000 in the aggregate) and (ii) prior to the Discharge of First
Lien Obligations, any securities account that is not subject to a control
agreement for the benefit of the Administrative Agent); provided that prior
to the Discharge of First Lien Obligations and for 60 days following the
Discharge of First Lien Obligations the requirements of this Section 4.01(h)
shall be satisfied by the Administrative Agent, including the Control Agent,
entering into a control agreement with respect to any such securities account
for the benefit of the Secured Parties.  The Collateral Agent agrees
with each of the Grantors that the Collateral Agent shall not give any such
entitlement orders or instructions or directions to any such Securities
Intermediary pursuant to any such Account Control Agreement, and shall not
withhold its consent to the exercise of any withdrawal or dealing rights by any
Grantor, unless a Designated Event of Default has occurred and is
continuing.

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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      (i)           Electronic Chattel Paper and
Transferable Records.  After the Discharge of First Lien
Obligations, if any Grantor at any time holds or acquires an interest in any
Electronic Chattel Paper or any “transferable record”, as that term is defined
in Section 201 of the Federal Electronic Signatures in Global and National
Commerce Act or in Section 16 of the Uniform Electronic Transactions Act as in
effect in any relevant jurisdiction, such Grantor shall promptly notify the
Collateral Agent thereof and, at the request of the Collateral Agent at any time
following the Discharge of First Lien Obligations, shall take such action as the
Collateral Agent may reasonably request (however, the Collateral Agent shall not
be required to request) to vest in the Collateral Agent control under UCC
Section 9-105 of such Electronic Chattel Paper or control under Section 201 of
the Federal Electronic Signatures in Global and National Commerce Act or, as the
case may be, Section 16 of the Uniform Electronic Transactions Act, as so in
effect in such jurisdiction, of such transferable record.  The
Collateral Agent agrees with such Grantor that the Collateral
Agent will arrange, pursuant to procedures reasonably satisfactory to the
Collateral Agent and so long as such procedures will not result in the
Collateral Agent’s loss of control, for the Grantor to make alterations to the
Electronic Chattel Paper or transferable record permitted under UCC Section
9-105 or, as the case may be, Section 201 of the Federal Electronic Signatures
in Global and National Commerce Act or Section 16 of the Uniform Electronic
Transactions Act for a party in control to allow without loss of control, unless
an Event of Default has occurred and is continuing.

    

     

    (j)           Letter-of-Credit
Rights.  If any Grantor is at any time a beneficiary under a
letter of credit now or hereafter issued in favor of such Grantor, such Grantor
or the Issuer, on behalf of such Grantor, shall promptly notify the Collateral
Agent thereof and, at the written request and option of the Collateral Agent at
any time after the Discharge of First Lien Obligations, such Grantor shall,
pursuant to an agreement in form and substance reasonably satisfactory to the
Collateral Agent, arrange for the issuer and any confirmer of such letter of
credit to consent to an assignment to the Collateral Agent of the proceeds of
any drawing under such letter of credit with the Collateral Agent agreeing that
the proceeds of any drawing under such letter of credit are to be paid to the
applicable Grantor unless an Event of Default has occurred or is
continuing.

     

    (k)           Commercial Tort
Claims.  If any Grantor shall at any time hold or acquire a
Commercial Tort Claim that it intends to pursue, the Grantor, by itself or
through Holdings, shall promptly notify the Collateral Agent thereof and in such
notice grant to the Collateral Agent for the benefit of the Secured Parties a
security interest in such Commercial Tort Claim.

     

    (l)           Equipment and Inventory
Locations.  If requested by the Collateral Agent, each Grantor
shall, at its own expense, use commercially reasonable efforts to cause any
landlord, bailee, warehouseman or processor with control over or with possession
of any Equipment (including Fixtures) and Inventory of such Grantor or any
landlord of a leased location where such Grantor primarily maintains its books
and records with respect to the Collateral to enter into a Waiver
Agreement.

     

    (m)           Material
Contracts.  If requested by the Collateral Agent, each Grantor
shall use commercially reasonable efforts to cause each party to each Material
Contract identified in Schedule 11 to
execute and deliver an Acknowledgement and Agreement with respect to such
Material Contract.

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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      SECTION
4.02      Representations and
Warranties.

       

      (a)           Validity of Security
Interest.  The Security Interest granted by each Grantor
constitutes (i) a legal and valid security interest in the Collateral of such
Grantor securing the payment and performance of the Secured Obligations of such
Grantor, (ii) subject to the filings described in Section 4.01(a), a
perfected security interest in the Collateral (other than as provided in such
Section) in which a security interest may be perfected under Article 9 of the
UCC by filing, recording or registering a financing statement or analogous
document in the United States (or any political subdivision thereof) and its
territories and possessions pursuant to the UCC in such jurisdictions and (iii)
subject to the filings described in Section 4.01(d), a
security interest that
shall be perfected in all such Collateral in which a security interest may be
perfected upon the receipt and recording of an Intellectual Property Security
Agreement with the United States Patent and Trademark Office and the United
States Copyright Office, as applicable, and otherwise as may be required
pursuant to the Laws of any other applicable jurisdiction.  The
Security Interest is and shall be prior to any other Lien on any of the
Collateral, other than Permitted Collateral Liens.

    

     

    (b)           Other Financing
Statements.  The Collateral is owned by the Grantors free and
clear of any Lien, other than Permitted Collateral Liens.  None of the
Grantors has filed or consented to the filing of (i) any financing statement or
analogous document under the UCC or any other applicable Laws covering any
Collateral, other than in respect of Permitted Collateral Liens, (ii) any
assignment in which any Grantor assigns any Collateral or any security agreement
or similar instrument covering any Collateral with the United States Patent and
Trademark Office or the United States Copyright Office or (iii) any assignment
in which any Grantor assigns any Collateral or any security agreement or similar
instrument covering any Collateral with any foreign governmental, municipal or
other office, which financing statement or analogous document, assignment,
security agreement or similar instrument is still in effect, except, in each
case, for Permitted Collateral Liens.

     

    ARTICLE
V

     

    COVENANTS

     

    Each
Grantor covenants and agrees with the Collateral Agent that until the
Termination Date such Grantor will comply with the following:

     

    SECTION
5.01      Perfection of Security
Interests.

     

    (a)           Change of
Name.  Each Grantor agrees to provide at least 30 days prior
written notice to the Collateral Agent of any change (i) in its legal name, (ii)
in its identity or type of organization or corporate structure, (iii) in its
Federal Taxpayer Identification Number or organizational identification number
or (iv) in its jurisdiction of organization.  Each Grantor agrees to
promptly provide the Collateral Agent with certified organizational documents
reflecting any of the changes described in the immediately preceding sentence,
to the extent applicable.  Each Grantor agrees not to effect or permit
any change referred to in the first sentence of this paragraph (a) unless all
filings have been made under the applicable UCC or otherwise that are required
in order for the Collateral Agent to continue at all times following such change
to have a valid, legal and perfected security interest in all the Collateral
with the same priority as immediately prior to such change.

     

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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      (b)           Maintenance of
Records.  Each Grantor agrees to maintain, at its own cost and
expense, such complete and accurate records with respect to the Collateral owned
by it in accordance with reasonably prudent and standard practices used in
industries that are the same as or similar to those in which such Grantor is
engaged, and, at such time or times as the Collateral Agent may reasonably
request in respect of any material portion of any Collateral, to prepare and
deliver
to the Collateral Agent a schedule or schedules in form and detail reasonably
satisfactory to the Collateral Agent showing the identity, amount and location
of any and all Collateral specified in any such request.

    

     

    (c)           Security Agreement
Supplements and IP Security Agreement Supplements.  Upon the
execution and delivery of any Joinder Agreement, the Grantor party to such
Joinder Agreement and Holdings shall execute and deliver to the Collateral Agent
a Security Agreement Supplement updating the Schedules hereto with respect to
such Grantor and, if necessary, an IP Security Agreement Supplement, updating
the schedules to the Intellectual Property Security Agreement.

     

    (d)           Further
Assurances.  (i)  Each Grantor shall, at its own
expense, take any and all commercially reasonable actions necessary to defend
title to all material Collateral against all Persons and to defend the Security
Interest of the Collateral Agent in all material Collateral and the priority
thereof against any Lien not expressly permitted to be prior to the Security
Interest pursuant to Section 4.10 of the
Indenture.

     

    (ii)        
  If at any time any Grantor shall take a security interest in any
property of an Account Debtor or any other Person to secure payment and
performance of an Account, such Grantor shall promptly assign such security
interest to the Collateral Agent to the extent permitted by any effective
provision of the contracts or arrangements to which such property is
subject.  Such assignment need not be filed of public record unless
necessary to continue the perfected status of the security interest against
creditors of and transferees from the Account Debtor or other Person granting
the security interest.  Each Grantor shall remain liable to observe
and perform all the conditions and obligations to be observed and performed by
it under each contract, agreement or instrument relating to or consisting of
part of the Collateral, all in accordance with the terms and conditions thereof,
and each Grantor jointly and severally agrees to indemnify and hold harmless
each Secured Party from and against any and all liability for such performance
(except to the extent such liability is found in a final judgment by a court of
competent jurisdiction to have resulted from such Secured Party’s gross
negligence or willful misconduct).

     

    (e)           Preserving Security
Interest.  Each Grantor agrees, at its own expense, to execute,
acknowledge, deliver and cause to be duly filed all such further instruments and
documents and take all such actions as the Collateral Agent may from time to
time reasonably request to better assure, preserve, protect and perfect the
Security Interest and the rights and remedies created hereby, including the
payment of any fees and taxes required in connection with the execution and
delivery of this Agreement, the granting of the Security Interest and the filing
of any financing statements (including fixture filings) or other documents in
connection herewith or therewith.

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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      (f)           Insurance.  The
Grantors, at their own expense, shall maintain or cause to be maintained, with
financially sound and reputable insurance companies having an A.M. Best
Financial Strength Rating of at least A (other than the insurance with Arch
Insurance Company which shall have an A.M.
Best Financial Strength Rating of at least A-) which are not Affiliates of the
Issuer, insurance covering physical loss or damage to the Inventory and
Equipment in of the kinds customarily insured against by Persons engaged in the
same or similar business, of such types and in such amounts as are customarily
carried under similar circumstances by such other Persons.  All such
insurance shall name the Collateral Agent as additional insured or loss
payee, as
applicable.  For the avoidance of doubt, it is intended that the
Collateral Agent shall have no obligations or liabilities under any such
insurance, including, without limitation, the obligation to maintain any such
insurance, to pay any premiums on any such insurance or to pay any expenses
whatsoever related thereto.  Each Grantor irrevocably makes,
constitutes and appoints the Collateral Agent (and all officers, employees or
agents designated by the Collateral Agent) as such Grantor’s true and lawful
agent (and attorney-in-fact) for the purpose, during the continuance of an Event
of Default at any time following the Discharge of First Lien Obligations, of
making, settling and adjusting claims in respect of Collateral under policies of
insurance, endorsing the name of such Grantor on any check, draft instrument or
other item of payment for the proceeds of such policies of insurance and for
making all determinations and decisions with respect thereto.  In the
event that any Grantor at any time or times shall fail to obtain or maintain any
of the policies of insurance required hereby or to pay any premium in whole or
part relating thereto, the Collateral Agent may, without waiving or releasing
any obligation or liability of any Grantor hereunder or any Event of Default, in
its sole discretion, obtain and maintain such policies of insurance and pay such
premium and take any other actions with respect thereto as the Collateral Agent
reasonably deems advisable.  All sums disbursed by the Collateral
Agent in connection with this Subsection 5.01(f),
including reasonable attorneys’ fees, court costs, expenses and other charges
relating thereto, shall be payable, upon demand, by the Grantors to the
Collateral Agent and shall be additional Secured Obligations secured
hereby.

    

     

    (g)           Inspection
Rights.  Without in any way limiting or expanding the rights of
any Secured Party or the Collateral Agent pursuant to the Indenture, the
Collateral Agent and such Persons as the Collateral Agent may reasonably
designate shall have the right, at the Grantors’ cost and expense, to inspect
the Collateral, all records related thereto (and to make extracts and copies
from such records) and the premises upon which any of the Collateral is located,
at reasonable times and intervals during normal business hours upon reasonable
advance notice to the respective Grantor, to discuss the Grantors’ affairs with
the officers of the Grantors and their independent accountants and to verify
under reasonable procedures, the validity, amount, quality, quantity, value,
condition and status of, or any other matter relating to, the Collateral,
including, in the case of Accounts or Collateral in the possession of any third
person, at any time that an Event of Default has occurred and is continuing, by
contacting Account Debtors or the third person possessing such Collateral for
the purpose of making such a verification.  The Collateral Agent shall
have the right to share any information it gains from such inspection or
verification with any Secured Party.

     

    (h)           Payment of
Taxes.  At its option, the Collateral Agent may discharge past
due taxes, assessments, charges, fees, Liens, security interests or other
encumbrances at any time levied or placed on the Collateral (other than
Permitted Collateral Liens), and may pay for the

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    maintenance and preservation of the Collateral
to the extent any Grantor fails to do so as required by the Indenture or this
Agreement, and the Grantors agree to reimburse the Collateral Agent on demand
for any payment made or any reasonable expense incurred by the Collateral Agent
pursuant to the foregoing authorization and shall be additional Secured
Obligations secured hereby; provided, however, that nothing
in this Section
5.01(h) shall be interpreted as excusing any Grantor from the performance
of, or imposing any obligation on the Collateral Agent or any Secured Party to
cure or perform, any covenants or other promises of any Grantor with respect to
taxes,
assessments, charges, fees, Liens, security interests or other encumbrances and
maintenance as set forth herein or in the other Security Documents and the
Indenture.

     

    (i)           Second Priority Nature of
Liens.  Each Grantor agrees that, in the event any Grantor,
pursuant to the First Lien Security Agreement, takes any action to grant or
perfect a Lien in favor of the Administrative Agent in any assets (other than
Excluded Securities), such Grantor shall also take such action to grant or
perfect a Lien (subject to the Intercreditor Agreement) in favor of the
Collateral Agent to secure the Secured Obligations without request of the
Collateral Agent, including with respect to any property and real property in
which the First Lien Agent directs a Grantor to grant or perfect a Lien or take
such other action under the First Lien Security Agreement.  The
parties hereto agree that the election to require the Grantors to provide a
perfected, first-priority security interest in any asset of the Grantors that is
not Collateral or is a Non-Collateral Asset (as defined in the Intercreditor
Agreement) shall be exercisable only by the Administrative Agent and that the
Collateral Agent shall not have any independent right to so require perfection
in such assets, prior to the Discharge of First Lien Obligations (except in the
event, and to the extent, that the First Lien Agent has actually obtained a
perfected, first-priority security interest in any such assets and such security
interest has not been released in accordance with the Intercreditor
Agreement).

     

    SECTION
5.02      Covenants Regarding Patent,
Trademark and Copyright Collateral.

     

    (a)           Patents.  Each
Grantor agrees that it will not do any act or omit to do any act (and will
prevent its licensees from doing any act or omitting to do any act) whereby any
Patent that is material to the conduct of the Grantors’ business may become
invalidated or dedicated to the public and agrees that it shall continue to mark
any products covered by such Patent with the relevant patent number as necessary
and sufficient to establish and preserve its maximum rights under applicable
patent law.

     

    (b)           Trademarks.  Each
Grantor (either itself or through its licensees or its sublicensees) will, for
each Trademark material to the conduct of such Grantor’s business, use its best
efforts to (i) maintain such Trademark in full force and effect, free from any
claim of abandonment or invalidity for non-use, (ii) maintain the quality of
products and services offered under such Trademark, and (iii) display such
Trademark with notice of Federal or foreign registration to the extent necessary
and sufficient to establish and preserve its rights under applicable Law, unless
in any such case such Grantor has determined that such Trademark is no longer
material to the conduct of its business and will not knowingly use or knowingly
permit the use of any Trademark in violation of any third party
rights.

     

    (c)           Copyrights.  Each
Grantor (either itself or through its licensees or its sublicensees) will, for
each work covered by a registered Copyright material to the conduct of the
Grantors’ business, continue to publish, reproduce, display, adopt and
distribute the work with appropriate copyright notice as necessary and
sufficient to establish and preserve its rights under applicable copyright laws,
unless in any such case such Grantor has determined that the maintenance of such
Copyright is not required for its business.

     

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    (d)           Abandoned Intellectual
Property.  Each Grantor, or Holdings, on behalf of the
Grantors, shall notify the Collateral Agent immediately if it has actual
knowledge that any Patent, registered Trademark or registered Copyright material
to the conduct of its business may become abandoned, lost or dedicated to the
public, or of any materially adverse determination or development (including the
institution of, or any such determination or development in, any proceeding in
the United States Patent and Trademark Office, United States Copyright Office or
any court or similar office of any country) regarding such Grantor’s ownership
of any such Patent, Trademark or Copyright, its right to register the same, or
its right to keep and maintain the same unless in any such case such Grantor has
determined that the maintenance of such Patent, Trademark or Copyright is not
required for its business.

     

    (e)           Notice of
Applications.  In no event shall any Grantor, either itself or
through any agent, employee, licensee or designee, file an application for any
Patent or the registration of any Trademark or Copyright with the United States
Patent and Trademark Office, United States Copyright Office or any office or
agency in any political subdivision of the United States or in any other country
or any political subdivision thereof, unless it promptly informs the Collateral
Agent thereof, and, upon request of the Collateral Agent, executes, delivers and
files with the United States Patent and Trademark Office or United States
Copyright Office, as applicable, an Intellectual Property Security Agreement
with respect to the Collateral Agent’s security interest in such Patent,
Trademark or Copyright of such Grantor relating thereto or represented thereby,
and each Grantor hereby appoints the Collateral Agent as its attorney-in-fact to
execute and file such writings for the foregoing purposes, all such acts of such
attorney being hereby ratified and confirmed; such power, being coupled with an
interest, is irrevocable.

     

    (f)           Maintaining Applications and
Registrations.  Each Grantor will take all steps to the extent
it deems reasonable and appropriate under the circumstances that are consistent
with the practice in any proceeding before the United States Patent and
Trademark Office, United States Copyright Office or any office or agency in any
political subdivision of the United States or in any other country or any
political subdivision thereof, to maintain and pursue each material application
relating to the Patents, Trademarks and/or Copyrights (and to obtain the
relevant grant or registration) and to maintain each issued Patent and each
registration of Trademarks and Copyrights that is material to the conduct of
such Grantor’s business, including timely filing of applications for renewal,
affidavits of use, affidavits of incontestability and payment of maintenance
fees, and, if consistent with good business judgment, to initiate opposition,
interference and cancellation proceedings against third parties unless in any
such case such Grantor has determined that the maintenance of such Patent,
Trademark or Copyright is not required for its business.

     

    (g)           Misappropriation.  In
the event that any Grantor believes that any Collateral consisting of a material
Patent, Trademark or Copyright is infringed, misappropriated or diluted by a
third party, which infringement, misappropriation or dilution could reasonably
be expected to have a Material Adverse Effect, such Grantor, by itself or
through Holdings, shall notify the Collateral Agent promptly after it learns
thereof and shall take such actions as such Grantor deems reasonable and
appropriate under the circumstances to protect such Collateral.

     

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    (h)           Consents. Upon and
during the continuance of an Event of Default, subject to the terms of the
Intercreditor Agreement, at the request of the Collateral Agent each Grantor
shall use commercially reasonable efforts to obtain all requisite consents or
approvals from the licensor under each license consisting of a Copyright
License, Patent License or Trademark License to effect the assignment of all
such Grantor’s right, title and interest thereunder to the Collateral Agent or
its designee.

     

    ARTICLE
VI

     

    REMEDIES;
RIGHTS UPON DEFAULT

     

    SECTION
6.01      Remedies upon
Default.

     

    (a)           Delivery of Collateral;
Other Actions.  Subject to the terms of the Intercreditor
Agreement, upon the occurrence and during the continuance of an Event of
Default, each Grantor agrees to deliver all or any item of Collateral to the
Collateral Agent on demand, and it is agreed that upon the occurrence and during
the continuation of a Designated Event of Default, subject to the terms of the
Intercreditor Agreement, the Collateral Agent shall have the right to take any
of or all the following actions at the same or different times:  (i)
with respect to any Collateral consisting of Intellectual Property, on demand,
to cause the Security Interest to become an assignment, transfer and conveyance
of any of or all such Collateral by the applicable Grantors to the Collateral
Agent (except to the extent an assignment, transfer or conveyance thereof would
result in a loss of said Intellectual Property), or to license or sublicense,
whether general, special or otherwise, and whether on an exclusive or
nonexclusive basis, any such Collateral throughout the world (other than in
violation of any then-existing licensing arrangements to the extent that waivers
cannot be obtained); (ii) with or without legal process and with or without
prior notice or demand for performance, to take possession of the Collateral and
without liability for trespass to enter any premises where the Collateral may be
located for the purpose of taking possession of or removing the Collateral;
(iii) enforce compliance with and take any and all action with respect to the
Pledged Collateral and other Collateral to the fullest extent as though the
Collateral Agent were the absolute owner thereof, including the right to receive
distributions and other payments with respect to the Pledged Collateral and the
other Collateral; and (iv) generally with respect to all Collateral, to exercise
any and all rights afforded to a secured party under the Uniform Commercial Code
or other applicable Law.  Without limiting the generality of the
foregoing, each Grantor agrees that, upon the occurrence and during the
continuance of an Event of Default, subject to the terms of the Intercreditor
Agreement, the Collateral Agent shall have the right to sell or otherwise
dispose of all or any part of the Collateral at a public or private sale or at
any broker’s board or on any securities exchange, for cash, upon credit or for
future delivery as the Collateral Agent shall deem appropriate.  The
Collateral Agent shall be authorized at any such sale of securities (if it deems
it advisable to do so) to restrict the prospective bidders or purchasers to
Persons who will represent and agree that they are purchasing the Collateral for
their own account for investment and not with a view to the distribution or sale
thereof, and upon consummation

     

     

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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      of any
such sale of Collateral the Collateral Agent shall have the right to assign,
transfer and deliver to the purchaser or purchasers thereof the Collateral so
sold.  Each such purchaser at any such sale
shall hold the property sold absolutely, free from any claim or right on the
part of any Grantor, and each Grantor hereby waives and releases (to the extent
permitted by law) all rights of redemption, stay, valuation and appraisal that
such Grantor now has or may at any time in the future have under any rule of Law
or statute now existing or hereafter enacted.

    

     

    (b)           Sale of
Collateral.  The Collateral Agent shall give Holdings 10 days’
written notice (which each Grantor agrees is reasonable notice within the
meaning of Section 9-611 of the UCC or its equivalent in other jurisdictions) of
the Collateral Agent’s intention to make any sale of Collateral.  Such
notice, in the case of a public sale, shall state the time and place for such
sale and, in the case of a sale at a broker’s board or on a securities exchange,
shall state the board or exchange at which such sale is to be made and the day
on which the Collateral, or portion thereof, will first be offered for sale at
such board or exchange.  Any such public sale shall be held at such
time or times within ordinary business hours and at such place or places as the
Collateral Agent may fix and state in the notice (if any) of such
sale.  At any such sale, the Collateral, or portion thereof, to be
sold may be sold in one lot as an entirety or in separate parcels, as the
Collateral Agent may (in its sole and absolute discretion)
determine.  The Collateral Agent shall not be obligated to make any
sale of any Collateral if it shall determine not to do so, regardless of the
fact that notice of sale of such Collateral shall have been
given.  The Collateral Agent may, without notice or publication,
adjourn any public or private sale or cause the same to be adjourned from time
to time by announcement at the time and place fixed for sale, and such sale may,
without further notice, be made at the time and place to which the same was so
adjourned.  In case any sale of all or any part of the Collateral is
made on credit or for future delivery, the Collateral so sold may be retained by
the Collateral Agent until the sale price is paid by the purchaser or purchasers
thereof, but the Collateral Agent shall not incur any liability in case any such
purchaser or purchasers shall fail to take up and pay for the Collateral so sold
and, in case of any such failure, such Collateral may be sold again upon like
notice.  At any public (or, to the extent permitted by law, private)
sale made pursuant to this Section 6.01, any
Secured Party may bid for or purchase for cash, free (to the extent permitted by
law) from any right of redemption, stay, valuation or appraisal on the part of
any Grantor (all said rights being also hereby waived and released to the extent
permitted by law), the Collateral or any part thereof offered for sale and such
Secured Party may, upon compliance with the terms of sale, hold, retain and
dispose of such property without further accountability to any Grantor
therefor.  For purposes hereof, a written agreement to purchase the
Collateral or any portion thereof shall be treated as a sale thereof; the
Collateral Agent shall be free to carry out such sale pursuant to such agreement
and no Grantor shall be entitled to the return of the Collateral or any portion
thereof subject thereto, notwithstanding the fact that after the Collateral
Agent shall have entered into such an agreement all Events of Default shall have
been remedied and the Secured Obligations paid in full.  As an
alternative to exercising the power of sale herein conferred upon it, subject to
the terms of the Intercreditor Agreement, the Collateral Agent may proceed by a
suit or suits at law or in equity to foreclose this Agreement and to sell the
Collateral or any portion thereof pursuant to a judgment or decree of a court or
courts having competent jurisdiction or pursuant to a proceeding by a
court-appointed receiver.  Any sale pursuant to the provisions of this
Section 6.01
shall be deemed to conform to the commercially reasonable standards as provided
in Section 9-610(b) of the UCC or its equivalent in other
jurisdictions.

     

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    (c)           Third Party
Consent.  Notwithstanding anything to the contrary contained in
this Agreement, if any enforceable term of any promissory note, contract,
agreement, permit, lease, license (including any License) or other General
Intangible included as a part of the Collateral requires the consent of the
Person obligated on such promissory note or any Person (other than the
applicable Grantor) obligated on such lease, contract or agreement, or which has
issued such permit or license or other General Intangible (i) for the creation,
attachment or perfection of the Lien of this Agreement in such Collateral or
(ii) for the assignment or transfer thereof or the creation, attachment or
perfection of such Lien not to give rise to a default, breach, right of
recoupment, claim, defense, termination, right of termination or other remedy
thereunder, then the receipt of any such necessary consent shall be a condition
to any exercise of remedies against such Collateral under this Section 6.01 (but not
to the creation, attachment or perfection of the Lien of this Agreement as
provided herein).

     

    SECTION
6.02      Application of
Proceeds.

     

    (a)           Subject
to the terms of the Intercreditor Agreement, the proceeds received by the
Collateral Agent in respect of any sale of, collection from or other realization
upon all or any part of the Collateral pursuant to the exercise by the
Collateral Agent of its remedies shall be applied, together with any other sums
then held by the Collateral Agent pursuant to this Agreement, as
follows:

     

     
(i)     first, to amounts owing to the Collateral Agent
in its capacity as such in accordance with the terms of this Agreement and the
Indenture and to amounts owing to the Trustee in its capacity as such in
accordance with the terms of the Indenture;

     

     (ii)     second,
to amounts owing to any Additional Pari Passu Agent in its capacity as such in
accordance with the terms of the Additional Pari Passu Agreement to which it is
a party;

     

    (iii)     third,
ratably to Secured Obligations owing to the holders of Secured Obligations in
accordance with the terms of the Indenture and Additional Pari Passu Agreements;
and

     

     (iv)    
fourth, to the Issuer and/or other Persons entitled thereto.

     

    (b)           In
making the determination and allocations required by this Section 6.02, the
Collateral Agent may conclusively rely upon information supplied by the
applicable Additional Pari Passu Agent as to the amounts of unpaid principal and
interest and other amounts outstanding with respect to the Permitted Additional
Pari Passu Obligations and the Collateral Agent shall have no liability to any
of the Secured Parties for actions taken in reliance on such
information.

     

    (c)           If,
despite the provisions of this Agreement, any Secured Party shall receive any
payment or other recovery in excess of its portion of payments on account of the
Secured Obligations to which it is then entitled in accordance with this
Agreement, such Secured Party shall hold such payment or other recovery in trust
for the benefit of all Secured Parties hereunder for distribution in accordance
with this Section
6.02.

     

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    SECTION
6.03      Grant of License to Use
Intellectual Property.  Subject
to any Licenses or other agreements with third parties that have been or may be
entered into by any Grantor, for the purpose of enabling the Collateral Agent to
exercise rights and remedies under this Agreement at such time as the Collateral
Agent shall be lawfully entitled to exercise such rights and remedies, each
Grantor hereby grants to the Collateral Agent an irrevocable, nonexclusive
license for the term of this Agreement (exercisable without payment of royalty
or other compensation to the Grantors) to use, license or sublicense any of the
Collateral consisting of Intellectual Property now owned or hereafter acquired
by such Grantor, wherever the same may be located, and including in such license
reasonable access to all media in which any of the licensed items may be
recorded or stored and to all computer software and programs used for the
compilation or printout thereof.  The use of such license by the
Collateral Agent may be exercised, at the option of the Collateral Agent, only
upon the occurrence and during the continuation of a Designated Event of
Default; provided that any
license, sublicense or other transaction entered into by the Collateral Agent in
accordance herewith shall be binding upon the Grantors notwithstanding any
subsequent cure of a Designated Event of Default.

     

    SECTION
6.04      Securities Act,
etc. In
view of the position of the Grantors in relation to the Pledged Collateral, or
because of other current or future circumstances, a question may arise under the
Securities Act of 1933, as now or hereafter in effect, or any similar statute
hereafter enacted analogous in purpose or effect (such Act and any such similar
statute as from time to time in effect being called the “Federal Securities
Laws”) with respect to any disposition of the Pledged Collateral or any
Investment Property permitted hereunder.  Each Grantor understands
that compliance with the Federal Securities Laws might very strictly limit the
course of conduct of the Collateral Agent if the Collateral Agent were to
attempt to dispose of all or any part of the Pledged Collateral or any
Investment Property, and might also limit the extent to which or the manner in
which any subsequent transferee of any Pledged Collateral or any Investment
Property could dispose of the same.  Similarly, there may be other
legal restrictions or limitations affecting the Collateral Agent in any attempt
to dispose of all or part of the Pledged Collateral or any Investment Property
under applicable Blue Sky or other state securities laws or similar laws
analogous in purpose or effect.  Each Grantor recognizes that in light
of such restrictions and limitations the Collateral Agent may, with respect to
any sale of the Pledged Collateral or any Investment Property, limit the
purchasers to those who will agree, among other things, to acquire such Pledged
Collateral or any such Investment Property for their own account, for
investment, and not with a view to the distribution or resale
thereof.  Each Grantor acknowledges and agrees that in light of such
restrictions and limitations, subject to the terms of the Intercreditor
Agreement, the Collateral Agent, when exercising remedies on behalf of the
Secured Parties after a Designated Event of Default has occurred and is
continuing, (a) may proceed to make such a sale whether or not a registration
statement for the purpose of registering such Pledged Collateral or Investment
Property or part thereof shall have been filed under the Federal Securities Laws
and (b) may approach and negotiate with a single potential purchaser to effect
such sale.  Each Grantor acknowledges and agrees that any such sale
might result in prices and other terms less favorable to the seller than if such
sale were a public sale without such restrictions.  In the event of
any such sale, the Collateral Agent shall incur no responsibility or liability
for selling all or any part of the Pledged Collateral or Investment Property at
a price that the Collateral Agent, in its sole and absolute discretion, may in
good faith deem reasonable under the circumstances, notwithstanding the
possibility that a substantially higher price might have been realized if the
sale were deferred until after registration as aforesaid or if more than a
single purchaser were approached.  The provisions of this Section 6.04 will
apply notwithstanding the existence of a public or private market upon which the
quotations or sales prices may exceed substantially the price at which the
Collateral Agent sells.

     

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    SECTION
6.05      Actions of Collateral
Agent. The
Applicable Authorized Representative shall direct the Collateral Agent in
exercising any right, power, discretionary duty or other remedy available to the
Collateral Agent under this Agreement, any other Security Document or the
Indenture and the other Secured Parties shall not have a right to take any
actions with respect to the Collateral.  If the Collateral Agent shall
not have received appropriate instructions within 10 days of a request therefor
from the Applicable Authorized Representative (or such shorter period as
reasonably may be specified in such notice or as may be necessary under the
circumstances), the Collateral Agent may, but shall be under no duty to, take or
refrain from taking such action as it shall deem to be in the best interests of
the Secured Parties and the Collateral Agent shall have no liability to any
Person for such action or inaction.  “Applicable Authorized
Representative” shall mean (i) the Trustee so long as the Secured
Obligations under the Notes and the Indenture constitute Secured Obligations
hereunder, and (ii) thereafter, the Additional Pari Passu Agent representing the
series of Indebtedness secured hereby with the greatest outstanding aggregate
principal amount.

     

    ARTICLE
VII

     

    MISCELLANEOUS

     

    SECTION
7.01      Notices. All
notices and other communications provided for hereunder shall be in writing and
mailed, delivered or transmitted by telecopies to each party hereto at the
address set forth in the Indenture (with any notice to a Grantor other than the
Issuer being delivered to such Grantor in care of Holdings) and with notice to
any Additional Pari Passu Agent given at its address specified in the Additional
Pari Passu Joinder Agreement to which it is a party or in any subsequent notice
amending such address.  All such notices and other communications
shall be deemed to be given or made at the times provided in the
Indenture.

     

    SECTION
7.02      Amendments, etc.; Additional
Grantors; Successors and Assigns.

     

    (a)           No
amendment to or waiver of any provision of this Agreement nor consent to any
departure by any Grantor herefrom, shall in any event be effective unless the
same shall be in
writing and signed by the Collateral Agent (subject to any necessary consents
required by the Indenture and any Additional Pari Passu Agreement) and, with
respect to any such amendment, by the Grantors or Holdings on behalf of itself
and the Subsidiary Grantors, and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which
given.  This Agreement shall be construed as a separate agreement with
respect to each Grantor and may be amended, modified, supplemented, waived or
released with respect to any Grantor without the approval of any other Grantor
and without affecting the obligations of any other Grantor
hereunder.

       

    

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    (b)           Upon
execution and delivery by the Collateral Agent and any Person of a Joinder
Agreement, such Person shall become a Grantor hereunder with the same force and
effect as if originally named as a Grantor herein.  The execution and
delivery of any such Joinder Agreement shall not require the consent of any
other Grantor hereunder.  The rights and obligations of each Grantor
hereunder shall remain in full force and effect notwithstanding the addition of
any new Grantor as a party to this Agreement.

     

    (c)           Upon
the delivery by Holdings and any other Grantor of a Security Agreement
Supplement certifying supplements to the Schedules hereto in respect of any
Grantor, such schedule supplements shall be incorporated into and become a part
of and supplement the Schedules hereto and the Collateral Agent may attach such
schedule supplements to such Schedules, and each reference to the Schedules
shall mean and be a reference to such Schedules, as supplemented pursuant to any
such Security Agreement Supplement.  For the avoidance of doubt, the
delivery of any Security Agreement Supplement shall not effect any release of
the security interest granted by any Grantor hereunder unless and until such
release shall be effective pursuant to Section
3.07.

     

    (d)           This
Agreement shall be binding upon each Grantor and its successors, transferees and
assigns and shall inure to the benefit of the Collateral Agent and each other
Secured Party and their respective successors, transferees and permitted
assigns; provided, however, that no
Grantor may assign its obligations hereunder without the prior written consent
of the Collateral Agent.

     

    SECTION
7.03      Survival of
Agreement.  All
covenants, agreements, representations and warranties made by each Grantor in
the Security Documents and the Indenture and in the certificates or other
instruments prepared or delivered in connection with or pursuant to this
Agreement or any other Security Document and the Indenture shall be considered
to have been relied upon by the Secured Parties and shall survive the execution
and delivery of the Security Documents and the Indenture, regardless of any
investigation made by any Secured Party or on its behalf and notwithstanding
that the Collateral Agent, or any Secured Party may have had notice or knowledge
of any Default or incorrect representation or warranty at the time any credit is
extended under the Indenture, and shall continue in full force and effect until
the Termination Date for such Grantor or any earlier release of such Grantor
hereunder pursuant to Section
3.07(b).

     

    SECTION
7.04      Collateral Agent Appointed
Attorney-in-Fact. Each
Grantor hereby appoints the Collateral Agent the attorney-in-fact of such
Grantor for the purpose, upon the occurrence and during the continuance of an
Event of Default, of carrying out the provisions of this Agreement and taking
any action and executing any instrument that the Collateral Agent may deem
necessary or advisable to accomplish the purposes hereof, which appointment is
irrevocable and coupled with an interest.  Without limiting the
generality of the foregoing, the Collateral Agent shall have the right, upon the
occurrence and during the continuance of a Designated Event of Default, with
full power of substitution either in the Collateral Agent’s name or in the name
of such Grantor, subject to the terms of the Intercreditor Agreement, (a) to
receive, endorse, assign and/or deliver any and all notes, acceptances, checks,
drafts, money orders or other evidences of payment relating to the Collateral or
any part thereof, (b) to demand, collect, receive payment of, give receipt for
and give discharges and releases of all or any of the Collateral, (c) to ask
for, demand, sue for, collect, receive and give acquittance for any and all
moneys due

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    or to
become due under and by virtue of any Collateral, (d) to sign the name of any
Grantor on any invoice or bill of lading relating to any of the Collateral, (e)
to send verifications of Accounts to any Account Debtor, (f) to commence and
prosecute any and all suits, actions or proceedings at law or in equity in any
court of competent jurisdiction to collect or otherwise realize on all or any of
the Collateral or to enforce any rights in respect of any Collateral, (g) to
settle, compromise, compound, adjust or defend any actions, suits or proceedings
relating to all or any of the Collateral, (h) to notify, or to require any
Grantor to notify, Account Debtors to make payment directly to the Collateral
Agent, and (i) to use, sell, assign, transfer, pledge, make any agreement with
respect to or otherwise deal with all or any of the Collateral, and to do all
other acts and things necessary to carry out the purposes of this Agreement, as
fully and completely as though the Collateral Agent were the absolute owner of
the Collateral for all purposes; provided, that nothing herein contained shall
be construed as requiring or obligating the Collateral Agent to make any
commitment or to make any inquiry as to the nature or sufficiency of any payment
received by the Collateral Agent, or to present or file any claim or notice, or
to take any action with respect to the Collateral or any part thereof or the
moneys due or to become due in respect thereof or any property covered
thereby.  The Collateral Agent and the other Secured Parties shall be
accountable only for amounts actually received as a result of the exercise of
the powers granted to them herein, and neither they nor their officers,
directors, employees or agents shall be responsible to any Grantor for any act
or failure to act hereunder, except for their own gross negligence or willful
misconduct.

     

    SECTION
7.05      Counterparts. This
Agreement may be executed in counterparts (and by different parties hereto in
different counterparts), each of which shall constitute an original, but all of
which when taken together shall constitute a single contract.  This
Agreement, the Indenture and the other Security Documents constitute the entire
contract among the parties relating to the subject matter hereof and supersede
any and all previous agreements and understandings, oral or written, relating to
the subject matter hereof.  This Agreement shall become effective when
it shall have been executed by the Collateral Agent and when the Collateral
Agent shall have received counterparts hereof that, when taken together, bear
the signatures of each of the other parties hereto.  Delivery of an
executed counterpart of a signature page of this Agreement by telecopy shall be
effective as delivery of a manually executed counterpart of this
Agreement.

     

    
      SECTION
7.06      Severability.  If
any provision of this Agreement is held to be illegal, invalid or unenforceable,
(a) the legality, validity and enforceability of the remaining provisions of
this Agreement  shall not be affected or impaired thereby and (b) the
parties shall endeavor in good faith negotiations to replace the illegal,
invalid or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the illegal, invalid or
unenforceable provisions.  The invalidity of a provision in a
particular jurisdiction shall not invalidate or render unenforceable such
provision in any other jurisdiction.

       

      SECTION
7.07      GOVERNING LAW; JURISDICTION;
ETC.

       

      (a)           GOVERNING
LAW.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE  LAWS OF THE STATE OF NEW YORK.

       

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    (b)           SUBMISSION TO
JURISDICTION.  EACH GRANTOR IRREVOCABLY AND UNCONDITIONALLY
SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE NONEXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK COUNTY AND OF THE UNITED
STATES DISTRICT COURT OF THE SOUTHERN DISTRICT OF SUCH STATE, AND ANY APPELLATE
COURT FROM ANY THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT OR ANY OTHER SECURITY DOCUMENT, OR FOR RECOGNITION OR
ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO IRREVOCABLY AND
UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL
COURT.  EACH OF THE PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY
SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY
LAW.  NOTHING IN THIS AGREEMENT OR IN ANY OTHER SECURITY DOCUMENT
SHALL AFFECT ANY RIGHT THAT THE COLLATERAL AGENT OR ANY OTHER SECURED PARTY MAY
OTHERWISE HAVE TO BRING ANY ACTION OR PROCEEDING RELATING TO THIS AGREEMENT OR
ANY OTHER SECURITY DOCUMENT AGAINST ANY GRANTOR OR ITS PROPERTIES IN THE COURTS
OF ANY JURISDICTION.

     

    (c)           WAIVER OF
VENUE.  EACH GRANTOR IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR ANY OTHER SECURITY DOCUMENT IN ANY COURT
REFERRED TO IN PARAGRAPH (b) OF THIS SECTION.  EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF SUCH ACTION OR
PROCEEDING IN ANY SUCH COURT.

     

    
      (d)           SERVICE OF
PROCESS.  EACH PARTY HERETO IRREVOCABLY CONSENTS TO SERVICE OF
PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION 7.01 OF THIS SECURITY
AGREEMENT.  NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY
PARTY HERETO TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE
LAW.

       

      SECTION
7.08      WAIVER OF JURY
TRIAL. EACH
PARTY HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING
DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER
SECURITY DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY (WHETHER
BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A)
CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PERSON WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT AND THE OTHER SECURITY DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL
WAIVERS AND CERTIFICATIONS IN THIS SECTION.

    

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    SECTION
7.09      ENTIRE
AGREEMENT.  THIS
AGREEMENT, THE OTHER SECURITY DOCUMENTS AND THE INDENTURE REPRESENT THE FINAL
AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES OR BY PRIOR OR
CONTEMPORANEOUS WRITTEN AGREEMENTS.  THERE ARE NO UNWRITTEN ORAL
AGREEMENTS AMONG THE PARTIES.

     

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

     

    SECTION
7.11      No Waiver;
Remedies.  No
failure or delay by the Collateral Agent or any other Secured Party in
exercising any right, power or remedy hereunder or under any other Security
Document or the Indenture shall operate as a waiver thereof, nor shall any
single or partial exercise of any such right, power or remedy, or any
abandonment or discontinuance of steps to enforce such a right, power or remedy,
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy.  The
rights, powers and remedies of the Collateral Agent and the Secured Parties
hereunder and under the other Security Documents and the Indenture are
cumulative and are not exclusive of any rights, powers or remedies that they
would otherwise have.  Without limiting the generality of the
foregoing, the issuance of the Notes shall not be construed as a waiver of any
Default, regardless of whether the Collateral Agent or any Secured Party may
have had notice or knowledge of such Default at the time.  No notice
or demand on the Issuer, Holdings or any other Grantor in any case shall entitle
the Issuer, Holdings or any other Grantor to any other or further notice or
demand in similar or other circumstances.

    
       

      SECTION
7.12      Headings.  Article
and Section headings and the Table of Contents used herein are for convenience
of reference only, are not part of this Agreement and are not to affect the
construction of, or to be taken into consideration in interpreting, this
Agreement.

       

      SECTION
7.13      Permitted Additional Pari
Passu Obligations.  On
or after the Issue Date, the Issuer may from time to time designate additional
obligations as Permitted Additional Pari Passu Obligations by delivering to the
Collateral Agent, the Trustee and each Additional Pari Passu Agent (a) a
certificate signed by the chief financial officer or treasurer of the Issuer
(upon which the Collateral Agent may conclusively and exclusively rely) (i)
identifying the obligations so designated and the aggregate principal amount or
face amount thereof, stating that such obligations are designated as “Permitted
Additional Pari Passu Obligations” for purposes hereof, (ii) representing that
such designation complies with the terms of the Indenture and
each

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    then
existing Additional Pari Passu Agreement and (iii) specifying the name and
address of the Additional Pari Passu Agent for such obligations (if other than
the Trustee); and (b) except in the case of Additional Notes, a fully executed
Additional Pari Passu Joinder Agreement (in the form attached as Exhibit 6
hereto).

     

    SECTION
7.14      Delivery to Collateral Agent
Generally.  To
the extent any information, agreement, certificates or other document to be
delivered or provided to the Collateral Agent under this Agreement has to be
satisfactory to the Collateral Agent, any information, agreement, certificates
or other document substantially similar in form and substance to any
corresponding information, agreement, certificates or other document delivered
to the Administrative Agent shall be deemed to be reasonably satisfactory to the
Collateral Agent.  The Collateral Agent shall not be required to make
any request hereunder without the instructions of the Applicable Authorized
Representative acting on the instructions of the applicable holders of the
Secured Obligations in accordance with the Indenture or any Additional Pari
Passu Debt Documents, as applicable.

     

    SECTION
7.15      Subordination of
Intercompany Notes.

     

    (a)           Each
Grantor hereby agrees that the payment of the principal of, interest on, and all
other amounts owing in respect of, any Intercompany Notes (the “Subordinated
Indebtedness”) is expressly
subordinated, to the extent and in the manner hereinafter set forth, to the
prior payment in full in cash of all Secured Obligations.

    
       

      (b)           Upon
the maturity of any Secured Obligations (including interest thereon or fees or
any other amounts owing in respect thereof), whether at stated maturity, by
acceleration or otherwise, all Obligations owing in respect thereof, in each
case to the extent due and owing, shall first be paid in full in cash before any
payment (whether in cash, property, securities or otherwise) is made on account
of the Subordinated Indebtedness.

       

      (c)           If
any Event of Default under the Indenture is in existence, upon a notice from the
Collateral Agent, the Grantors may not, directly or indirectly, make any payment
of any Subordinated Indebtedness and may not acquire any Subordinated
Indebtedness for cash or property until all Secured Obligations have been paid
in full in cash.  Each Grantor that is a holder of any Intercompany
Note hereby agrees that, so long as any such Event of Default in respect of any
Secured Obligations exists and a notice was provided by Collateral Agent, it
will not sue for, or otherwise take any action to enforce the obligations to
pay, amounts owing in respect of any Intercompany Note.

       

      (d)           Subject
to the terms of the Intercreditor Agreement, in the event that notwithstanding
the provisions of the preceding clauses (b) and (c) of this Section, any Grantor
shall make any payment on account of the Subordinated Indebtedness at a time
when payment is not permitted by said clauses (b) or (c), such payment shall be
held by the holder of the Intercompany Note, in trust for the benefit of, and
shall be paid forthwith over and delivered to, the Collateral Agent at any time
prior to the date on which the Termination Date (as defined in the Indenture)
for such Grantor has occurred for application to the payment in full in cash of
all the applicable Secured Obligations.

       

    

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    (e)           Upon
any distribution of assets of the issuer of any Intercompany Note upon
dissolution, winding up, liquidation or reorganization of such issuer (whether
in bankruptcy, insolvency, receivership proceedings, upon an assignment for the
benefit of creditors or otherwise), subject to the terms of the Intercreditor
Agreement:

     

     
(i)     holders of all Secured Obligations shall first
be entitled to receive payment in full in cash of all Secured Obligations
(including, without limitation, post-petition interest at the rate provided in
the documentation with respect to the Secured Obligations, whether or not such
post-petition interest is an allowed claim against such issuer in any bankruptcy
or similar proceeding) before the holder of such Intercompany Note is entitled
to receive any payment of any kind or character on account of the Subordinated
Indebtedness;

     

     (ii)     any
payment or distributions of assets of such issuer of any kind or character,
whether in cash, property or securities to which the holder of such Intercompany
Note would be entitled except for the provisions of this Section, shall be paid
by the liquidating trustee or other person making such payment or distribution,
whether a trustee in bankruptcy, a receiver or liquidating trustee, directly to
the Collateral Agent for application to the payment in full in cash of all the
applicable Secured Obligations; and

    
      

      (iii)     in
the event that, notwithstanding the foregoing provisions of this Section, any
payment or distribution of assets of such issuer of any kind or character,
whether in cash, property or securities, shall be received by the holder of such
Intercompany Note on account of Subordinated Indebtedness before all Secured
Obligations are paid in full in cash, such payment or distribution shall be
received and held in trust for and shall be paid over to the Collateral Agent
for application to the payment in full in cash of all the applicable Secured
Obligations.

       

      (f)           Subject
to the prior payment in full in cash of all Secured Obligations, the holder of
any Intercompany Note shall be subrogated to the rights of the holders of
Secured Obligations to receive payments or distributions of assets of the issuer
of such Intercompany Note applicable to the Secured Obligations until all
amounts owing on such Intercompany Note shall be paid in full, and for the
purpose of such subrogation no payments or distributions to the holders of the
Secured Obligations by or on behalf of such issuer or by or on behalf of the
holder of such Intercompany Note by virtue of this Section which otherwise would
have been made to the holder of the Intercompany Note shall, as between such
issuer, its creditors (other than the holders of Secured Obligations) and the
holder of such Intercompany Note, be deemed to be payment by such issuer to or
on account of the Secured Obligations, it being understood that the provisions
of this Section are and are intended solely for the purpose of defining the
relative rights of the holder of any Intercompany Note, on the one hand, and the
holders of the Secured Obligations, on the other hand.

       

      (g)           No
right of the Collateral Agent or any present or future holders of any Secured
Obligations to enforce subordination as herein provided shall at any time in any
way be prejudiced or impaired by any act or failure to act on the part of issuer
of any Intercompany Note or by any act or failure to act in good faith by the
Collateral Agent or any such holder, or by any noncompliance by such issuer with
the terms and provisions of such Intercompany Note, regardless

    

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    of any
knowledge thereof which the Collateral Agent or such holder may have or be
otherwise charged with.  The Collateral Agent and the holders of the
Secured Obligations may, without in any way affecting the obligations of the
holder of the Intercompany Note with respect hereto, at any time or from time to
time and in their absolute discretion, change the manner, place or terms of
payment of, change or extend the time of payment of, or renew or alter, any
Secured Obligations (including, without limitation, increase the amount of
Secured Obligations by extending additional credit to the Grantors) or amend,
modify or supplement any agreement or instrument governing or evidencing such
Secured Obligations or any other document referred to therein, or exercise or
refrain from exercising any other of their rights under the Secured Obligations
including, without limitation, the waiver of any Default or Event of Default or
the release of any Collateral securing such Secured Obligations, all without
notice to or assent from the holder of the Intercompany Note.

     

    SECTION
7.16      Collateral
Agent.

     

    Notwithstanding
anything to the contrary herein, the following provisions shall govern the
Collateral Agent’s rights, powers, obligations and duties under this Security
Agreement:

    
      

      (a)           Each
of the Holders and the Trustee hereby designates and
appoints Wells Fargo Bank, National Association to act as Collateral
Agent under this Security Agreement, and hereby authorizes the Collateral
Agent to take such actions on its behalf under the provisions of this Security
Agreement and to exercise such powers and perform such duties as are expressly
delegated to the Collateral Agent by the terms of this Security
Agreement.  Notwithstanding any provision to the contrary elsewhere in
this Security Agreement, Collateral Agent shall not have any duties or
responsibilities, except those expressly set forth in this Security Agreement or
any fiduciary relationship with any Holders or Secured Parties or holders
of First Lien Obligations or agents of holders of First Lien Obligation, and no
implied covenants, functions or responsibilities shall be read into this
Security Agreement or otherwise exist against Collateral Agent.

       

      (b)           Notwithstanding
anything herein to the contrary, in no event shall the Collateral Agent have any
obligation to inquire or investigate as to the correctness, veracity, or content
of any instruction received from any other Security
Documents.  In no event shall the Collateral Agent have any liability
in respect of any such instruction received by it and relied on with respect to
any action or omission taken pursuant thereto.

       

      (c)           With
respect to the Collateral Agent’s duties under this Security Agreement or any of
the Security Documents, the Collateral Agent may act through its attorneys,
accountants, experts and such other professionals as the Collateral Agent deems
necessary, advisable or appropriate and shall not be responsible for the
misconduct or negligence of any attorney, accountant, expert or other such
professional appointed with due care.

       

      (d)           Neither
the Collateral Agent nor any of its experts, officers, directors, employees,
agents, attorneys-in-fact or affiliates shall be (i) liable for any action
lawfully taken or omitted to be taken by it under or in connection with this
Security Agreement (except for its gross negligence or willful misconduct), or
(ii) responsible in any manner for any recitals, statements, representations or
warranties (other than its own recitals, statements, representations or
warranties) made in this Security Agreement or in any certificate, report,
statement or other document

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    referred
to or provided for in, or received by the Collateral Agent under or in
connection with, this Security Agreement or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Security
Agreement or for any failure of the Grantors or any other Person to perform
their obligations hereunder and thereunder.  The Collateral Agent
shall not be under any obligation to any Person to ascertain or to inquire as to
(i) the observance or performance of any of the agreements contained in, or
conditions of, this Security Agreement or to inspect the properties, books or
records of the Grantors, (ii) whether or not any representation or warranty made
by any Person in connection with this Security Agreement is true, (iii) the
performance by any Person of its obligations under this Security Agreement or
(iv) the breach of or default by any Person of its obligations under this
Security Agreement.

     

    (e)           The
Collateral Agent shall not be bound to (i) account to any Person for any sum or
the profit element of any sum received for its own account; (ii) disclose to any
other Person any information relating to the Person if such disclosure would, or
might, constitute a breach of any law or regulation or be otherwise actionable
at the suit of any Person; (iii) be under any fiduciary duties or obligations
other than those for which express provision is made in this Security Agreement;
or (iv) be required to take any action that it believes, based on advice of
counsel, is in
conflict with any applicable law, this Security Agreement, or any order of any
court or administrative agency;

     

    
      (f)           The
Collateral Agent shall be authorized to but shall not be responsible for filing
any financing or continuation statements or recording any documents or
instruments in any public office at any time or times or otherwise perfecting or
monitoring or maintaining the perfection of any security interest in the
Collateral.  It is expressly agreed, to the maximum extent permitted
by applicable law, that the Collateral Agent shall have no responsibility for
(i) taking any necessary steps to preserve rights against any Person with
respect to any Collateral or (ii) taking any action to protect against any
diminution in value of the Collateral, but, in each case (A) subject to the
requirement that the Collateral Agent may not act or omit to take any action if
such act or omission would constitute gross negligence or willful misconduct and
(B) the Collateral Agent may do so and all expenses reasonably incurred in
connection therewith shall be part of the Obligations.

       

      (g)           The
Collateral Agent shall not be liable or responsible for any loss or diminution
in the value of any of the Collateral, by reason of the act or omission of any
carrier, forwarding agency or other agent or bailee selected by the Collateral
Agent in good faith, except to the extent of the Collateral Agent’s gross
negligence or willful misconduct.

       

      (h)           The
Collateral Agent shall not be responsible for, nor incur any liability with
respect to, (i) the existence, genuineness or value of any of the Collateral or
for the validity, perfection, priority or enforceability of the security
interest in any of the Collateral, whether impaired by operation of law or by
reason of any action or omission to act on its part under this Security
Agreement or any of the other Security Documents, except to the extent such
action or omission constitutes gross negligence or willful misconduct on the
part of the Collateral Agent, (ii) the validity or sufficiency of the Collateral
or any agreement or assignment contained therein, (iii) the validity of the
title of the Grantors to the Collateral, (iv) insuring the Collateral or (v) the
payment of taxes, charges or assessments upon the Collateral or otherwise as to
the maintenance of the Collateral.

    

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
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    (i)           Notwithstanding
anything in this Security Agreement to the contrary, in no event shall the
Collateral Agent or any officer, director, employee, representative or agent of
the Collateral Agent be liable under or in connection with this Security
Agreement for indirect, special, incidental, punitive or consequential losses or
damages of any kind whatsoever, including but not limited to lost profits or
loss of opportunity, whether or not foreseeable, even if the Collateral Agent
has been advised of the possibility thereof and regardless of the form of action
in which such damages are sought.  In no event shall the Collateral
Agent be obligated to invest any amounts received by it hereunder.

     

    (j)           The
Collateral Agent shall be entitled conclusively to rely, and shall be fully
protected in relying, upon any note, writing, resolution, request, direction,
certificate, opinion, notice, consent, affidavit, letter, cablegram,
telegram, telecopy, email, telex or teletype message, statement, order or other
document or conversation believed by it in good faith to be genuine and correct
and to have been signed, sent or made by the proper Person or Persons and/or
upon advice and/or statements of legal counsel, independent accountants and
other experts selected by the Collateral Agent and need not investigate any fact
or matter stated in any such document. Any such
statement of legal counsel shall be full and complete authorization and
protection in respect of any action taken or suffered by it hereunder in
accordance therewith.  The Collateral Agent shall be fully justified in
failing or refusing to take any action under this Security Agreement or any of
the other Security Documents (i) if such action would, in the reasonable
opinion of the Collateral Agent (which may be based on the opinion of legal
counsel), be contrary to applicable law or any of the Security Documents,
(ii) if such action is not provided for in this Security Agreement or any of the
other Security Documents, (iii) if, in connection with the taking of any
such action hereunder that would constitute an exercise of remedies hereunder or
under any of the Indenture it shall not first be indemnified to its satisfaction
by the Holders against any and all risk of nonpayment, liability and
expense that may be incurred by it, its agents or its counsel by reason of
taking or continuing to take any such action, or (iv) if, notwithstanding
anything to the contrary contained in this Security Agreement, in connection
with the taking of any such action that would constitute a payment due under any
agreement or document, it shall not first have received from the Holders or
the Grantors funds equal to the amount payable. The Collateral Agent shall in
all cases be fully protected in acting, or in refraining from acting, under this
Security Agreement or any of the other Security Documents in accordance
with a request of the requisite percentage of Holders, and such request and any
action taken or failure to act pursuant thereto shall be binding upon all the
other Holders and the Trustee.

     

    (k)           The
Collateral Agent shall not be deemed to have actual, constructive, direct or
indirect knowledge or notice of the occurrence of any Default unless and until
the Collateral Agent has received a written notice or a certificate from the
Grantors stating that a Default has occurred.  The Collateral Agent
shall have no obligation whatsoever either prior to or after receiving such
notice or certificate to inquire whether a Default has in fact occurred and
shall be entitled to rely conclusively, and shall be fully protected in so
relying, on any notice or certificate so furnished to it.  No
provision of this Security Agreement, the Intercreditor Agreement
or  the Indenture shall require the Collateral Agent to expend or risk
its own funds or otherwise incur

     

     

    
      
        
        

      

      
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    any
financial liability in the performance of any of its duties under this Security
Agreement or the Indenture or the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such funds or
adequate indemnity against such risk or liability including an advance of moneys
necessary to perform work or to take the action requested is not reasonably
assured to it, the Collateral Agent may decline to act unless it receives
indemnity satisfactory to it in its sole discretion, including an advance of
moneys necessary to take the action requested. The Collateral Agent shall be
under no obligation or duty to take any action under this Security Agreement or
any other Security Documents or the Indenture or otherwise if taking
such action (i) would subject the Collateral Agent to a tax in any jurisdiction
where it is not then subject to a tax or (ii) would require the Collateral Agent
to qualify to do business in any jurisdiction where it is not then so
qualified.

     

    (l)           Any
corporation into which the Collateral Agent may be merged, or with which it may
be consolidated, or any corporation resulting from any merger or consolidation
to which the Collateral Agent shall be a party, shall become a Collateral Agent
under this Security Agreement without the execution or filing of any paper or
any further act on the part of the parties hereto except for written notice to
the other parties hereto.

    
      

      (m)           The
Collateral Agent may resign as Collateral Agent at any time upon written notice
to the Holders, Trustee and the Grantors and may be removed at any
time with or without cause by holders of a majority in principal amount of
Notes, with any such resignation or removal to become effective only upon the
appointment of a successor Collateral Agent under this Section.  If
the Collateral Agent shall provide notice of its resignation or be removed as
Collateral Agent, then a majority in principal amount of Notes  shall
(and if no such successor shall have been appointed within 45 days of the
Collateral Agent’s resignation or removal, the Collateral Agent may) appoint a
successor Collateral Agent which successor agent shall, in the case of
any appointment by the Collateral Agent, be reasonably acceptable to the
majority in principal amount of Notes, and the former Collateral Agent’s rights,
powers and duties as Collateral Agent shall be terminated, without any other or
further act or deed on the part of such former Collateral Agent (except that the
resigning Collateral Agent shall deliver all Collateral then in its possession
to the successor Collateral Agent and shall execute and deliver to the successor
Collateral Agent such instruments of assignment and transfer and other similar
documents as such successor Collateral Agent shall deem necessary or advisable
(at the joint and several expense of the Grantors).  After any
retiring Collateral Agent’s resignation or removal hereunder as Collateral
Agent, the provisions of this Security Agreement shall inure to its benefit as
to any actions taken or omitted to be taken by it while it was Collateral
Agent.  In the event that a successor Collateral Agent is not
appointed within the time period specified in this Section following the
provision of a notice of resignation or removal of the Collateral Agent, the
Collateral Agent or any other Secured Party may petition a court of competent
jurisdiction for the appointment of a successor Collateral Agent (at the joint
and several expense of the Grantors).

       

      SECTION
7.17       Indemnity and
Expenses.

       

      (a)           
Each Grantor agrees to indemnify the Collateral Agent and its officers,
directors, agent and employees  from and against all claims, lawsuits
and liabilities (including reasonable attorneys fees) growing out of or
resulting from this Agreement (including enforcement of
this

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

        
          -47-

          
            

          

        

        
           

        

      

    

     

    Agreement),
except claims, losses or liabilities resulting from the gross negligence or
willful misconduct of the party seeking indemnification as determined by a final
non-appealable order of a court of competent jurisdiction.  This
provision shall survive the termination of this Agreement and the Indenture and
the repayment of the Secured Obligations and the resignation or removal of the
Collateral Agent.

     

    (b)           Grantors,
jointly and severally, shall, upon demand, pay to the Collateral Agent (or the
Collateral Agent may charge to the Issuer) all of the reasonable fees, costs,
and expenses (including the reasonable fees and expenses of the Collateral
Agent’s  counsel) which the Collateral Agent may incur in connection
with (i) upon the occurrence of an Event of Default, the sale of,
collection from, or other realization upon, any of the Collateral in accordance
with this Agreement and the other Security Documents, (ii) the exercise or
enforcement of any of the rights of the Collateral Agent hereunder or
(iii) the failure by any Grantor to perform or observe any of the
provisions hereof to the extent required by Section 12.01 of the
Indenture.

     

    [Signature
pages to follow]

    

    
      
        
          
            

            
              	 
      

            

             

             

          

           

        

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

     

     

    CENVEO
CORPORATION

     

    By:    /s/ Mark
S.
Hiltwein                                 

    Name: Mark S.
Hiltwein

    Title:   Chief Financial
Officer

     

    CENVEO,
INC.

     

    
      By:    /s/ Mark
S.
Hiltwein                                 

      Name: Mark S.
Hiltwein

      Title:   Chief Financial
Officer

    

     

    

    
      
        
          
            
              	 
      

            

            Security
Agreement

            Signature
Page

            

            S-1

          

           

        

        
          
          

          
            

          

        

        
           

        

      

    

    

    CENVEO
COMMERCIAL OHIO, LLC, a Colorado limited liability company

    CNMW
INVESTMENTS, INC., a Delaware corporation

    CENVEO
GOVERNMENT PRINTING, INC., a Colorado corporation

    CENVEO
SERVICES, LLC, a Colorado limited liability company

    CENVEO
RESALE OHIO, LLC, a Colorado limited liability company

    DISCOUNT
LABELS, LLC, an Indiana limited liability company

    CENVEO
OMEMEE LLC, a Delaware limited liability company

    COLORHOUSE
CHINA, INC., a Colorado corporation

    RX JV
HOLDING, INC., a Delaware corporation

    CRX JV,
LLC, a Delaware limited liability company

    CRX
HOLDING, INC., a Delaware corporation

    RX
TECHNOLOGY CORP., a Delaware corporation

    CADMUS
PRINTING GROUP, INC., a Virginia corporation

    CADMUS
FINANCIAL DISTRIBUTION, INC., a Virginia corporation

    CADMUS
TECHNOLOGY SOLUTIONS, INC., a Virginia corporation

    GARAMOND/PRIDEMARK
PRESS, INC., a Maryland corporation

    WASHBURN
GRAPHICS, INC., a North Carolina corporation

    CADMUS
JOURNAL SERVICES, INC., a Virginia corporation

    CADMUS
DELAWARE, INC., a Delaware corporation

     

    
      By:    /s/ Mark
S.
Hiltwein                                 

      Name: Mark S.
Hiltwein

      Title:   Chief Financial
Officer

    

    

    
      
        
          
            
              	 
      

            

            Security
Agreement

            Signature
Page

            

            S-1

          

           

        

        
          
          

          
            

          

        

        
           

        

      

    

    

    CADMUS
UK, INC., a Virginia corporation

    EXPERT
GRAPHICS, INC., a Virginia corporation

    CADMUS
MARKETING GROUP, INC., a Virginia corporation

    CADMUS
DIRECT MARKETING, INC., a North Carolina corporation

    CADMUS
INTERACTIVE, INC., a Georgia corporation

    CADMUS
MARKETING, INC., a Virginia corporation

    CADMUS/O’KEEFE
MARKETING, INC., a Virginia corporation

    OLD TSI,
INC., a Georgia corporation

    CADMUS
INVESTMENTS, LLC, a Delaware limited liability company

    PORT CITY
PRESS, INC., a Maryland corporation

    SCIENCE
CRAFTSMAN INCORPORATED, a New York corporation

    CADMUS
INTERNATIONAL HOLDINGS, INC., a Virginia corporation

    CDMS
MANAGEMENT, LLC, a Delaware limited liability company

    VAUGHAN
PRINTERS INCORPORATED, a Florida corporation

    
      	
               
      

            	
              MADISON/GRAHAM
      COLORGRAPHICS, INC., a California
corporation

            

    

    PC INK
CORP., a Delaware corporation

    PRINTEGRA
CORPORATION, a Georgia corporation

    VSUB
HOLDING COMPANY, a Virginia corporation

     

    
      By:    /s/ Mark
S.
Hiltwein                                 

      Name: Mark S.
Hiltwein

      Title:   Chief Financial
Officer

    

     

    

    
      
        
          
            
              	 
      

            

            Security
Agreement

            Signature
Page

            

            S-1

          

           

        

        
          
          

          
            

          

        

        
           

        

      

    

    

    MADISON/GRAHAM
COLORGRAPHICS  INTERSTATE

    SERVICES,
INC., a California corporation

    COMMERCIAL
ENVELOPE MANUFACTURING CO., INC.

    a New
York corporation

    BERLIN
& JONES CO., LLC, a New York limited liability company

    HEINRICH
ENVELOPE, LLC, a New York limited liability company

    CENVEO
CEM, INC., a Delaware corporation

    CENVEO
CEM, LLC, a Delaware limited liability company

    REX
CORPORATION, a Florida corporation

    136
EASTPORT ROAD, LLC, a Delaware limited liability company

    LIGHTNING
LABELS, LLC, a Delaware limited liability company

    NASHUA
CORPORATION, a Massachusetts corporation

    NASHUA
INTERNATIONAL, INC., a Delaware corporation

    

    
      By:    /s/ Mark
S.
Hiltwein                                 

      Name: Mark S.
Hiltwein

      Title:   Chief Financial
Officer

    

    

     

    

    
      
        
          
            
              	 
      

            

            Security
Agreement

            Signature
Page

            

            S-1

          

           

        

        
          
          

          
            

          

        

        
           

        

      

    

    

    WELLS
FARGO BANK, NATIONAL ASSOCIATION,

    as
Collateral Agent

     

    By: /s/ Raymond
Delli
Colli                           

          
Name:
Raymond Delli Colli

          
Title:
Vice President

     

     

     

    
 

    
      Schedules
to

      
      

      Security
Agreement

       

      S-2

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