Document:

Exhibit 10.10

 

PLEDGE AGREEMENT

 

PLEDGE
AGREEMENT, dated as of March 17, 2004 (as amended, restated, modified and/or
supplemented from time to time, this “Agreement”), among each of the
undersigned (each, a “Pledgor” and, together with each other entity which
becomes a party hereto pursuant to Section 25, collectively, the “Pledgors”)
and Bank of America, N.A., as Collateral Agent (together with any successor
Collateral Agent, the “Pledgee”), for the benefit of the Secured
Creditors (as defined below).  Except as
otherwise defined herein, terms used herein and defined in the Credit Agreement
(as defined below) shall be used herein as therein defined.

 

W I T N E S S E T
H :

 

WHEREAS,
EnerSys (“Holdings”), EnerSys Capital Inc. (the “Borrower”),
various financial institutions from time to time party thereto (the “Lenders”),
Bank of America, N.A. as Administrative Agent (together with a successor
Administrative Agent, the “Administrative Agent” and, together with the
Lenders, the Collateral Agent, each Letter of Credit Issuer, each other Agent
and the Pledgee, the “Lender Creditors”), Morgan Stanley Senior Funding
Inc., as Syndication Agent, and Lehman Commercial Paper Inc., as Documentation
Agent, have entered into a Credit Agreement, dated as of March 17, 2004 providing
for the making of Loans to the Borrower and the issuance of, and participation
in, Letters of Credit for the account of the Borrower as contemplated therein
(as used herein, the term “Credit Agreement” means the Credit Agreement
described above in this paragraph as amended, restated, modified, extended,
renewed, replaced, supplemented, restructured and/or refinanced from time to
time);

 

WHEREAS,
the Borrower and/or one or more of its Subsidiaries may at any time and from
time to time (i) enter into one or more Interest Rate Protection Agreements or
Other Hedging Agreements with one or more Lenders or any affiliate thereof,
(ii) enter into one or more Commodities Agreements with one or more Lenders or
any affiliate thereof and/or (iii) maintain Existing Interest Rate Protection
Agreements with any financial institution (each such Lender, affiliate or
financial institution, even if the respective Lender subsequently ceases to be
a Lender under the Credit Agreement for any reason, together with such Lender’s,
affiliate’s or other financial institution’s successors and assigns, if any,
collectively, the “Other Creditors” and together with the Lender
Creditors, the “Secured Creditors”); 

 

WHEREAS,
pursuant to the Credit Agreement Party Guaranty, each of Holdings and the
Borrower has unconditionally guaranteed to the Secured Creditors the payment
when due of all Relevant Guaranteed Obligations as described therein;

 

WHEREAS,
pursuant to the Subsidiaries Guaranty, each Subsidiary Guarantor has jointly
and severally guaranteed to the Secured Creditors the payment when due of all
Guaranteed Obligations as described therein;

 

WHEREAS,
it is a condition precedent to the making of Loans to the Borrower and the
issuance of, and participation in, Letters of Credit for the account of the
Borrower under the Credit Agreement and to the Other Creditors entering into
and/or maintaining Secured

 

 

Hedging Agreements that each Pledgor shall have executed and delivered
to the Pledgee this Agreement; and

 

WHEREAS,
each Pledgor will obtain benefits from the incurrence of Loans by the Borrower
and the issuance of and participation in, Letters of Credit for the account of
the Borrower under the Credit Agreement and the entering into by and/or the
maintaining by the Borrower and/or one or more of its Subsidiaries of Secured
Hedging Agreements and, accordingly, desires to execute this Agreement in order
to satisfy the condition precedent described in the preceding paragraph and to
induce the Lenders to make Loans to the Borrower and to issue, and participate
in, Letters of Credit for the account of the Borrower, and to induce the Other
Creditors to enter into and/or maintain Secured Hedging Agreements with the
Borrower and/or one or more of its Subsidiaries;

 

NOW,
THEREFORE, in consideration of the foregoing and other benefits accruing to
each Pledgor, the receipt and sufficiency of which are hereby acknowledged,
each Pledgor hereby makes the following representations and warranties to the
Pledgee for the benefit of the Secured Creditors and hereby covenants and
agrees with the Pledgee for the benefit of the Second Creditors as follows:

 

1.                                       SECURITY
FOR OBLIGATIONS.  This Agreement is made by each Pledgor for the
benefit of the Secured Creditors to secure:

 

(i)                                     the
full and prompt payment when due (whether at stated maturity, by acceleration
or otherwise) of all obligations, liabilities and indebtedness (including,
without limitation, principal, premium, interest (including, without
limitation, all interest that accrues after the commencement of any case,
proceeding or other action relating to the bankruptcy, insolvency,
reorganization or similar proceeding of any Pledgor or any Subsidiary thereof
at the rate provided for in the respective documentation, whether or not a
claim for post-petition interest is allowed in any such proceeding),
reimbursement obligations under Letters of Credit, fees, costs and indemnities)
of such Pledgor owing to the Lender Creditors, whether now existing or
hereafter incurred under, arising out of, or in connection with, the Credit
Agreement and the other Credit Documents to which such Pledgor is a party
(including, in the case of each Pledgor that is a Guarantor, all such
obligations, liabilities and indebtedness of such Pledgor under its Guaranty)
and the due performance and compliance by such Pledgor with all of the terms,
conditions and agreements contained in the Credit Agreement and in such other
Credit Documents (all such obligations, liabilities and indebtedness under this
clause (i), except to the extent consisting of obligations, liabilities or
indebtedness with respect to Secured Hedging Agreements entitled to the
benefits of this Agreement being herein collectively called the “Credit
Document Obligations”);

 

(ii)                                  the
full and prompt payment when due (whether at stated maturity, by acceleration
or otherwise) of all obligations, liabilities and indebtedness (including,
without limitation, all interest that accrues after the commencement of any
case, proceeding or other action relating to the bankruptcy, insolvency,
reorganization or similar proceeding of any Pledgor or any Subsidiary thereof
at the rate provided for in the respective documentation, whether or not a
claim for

 

 

post-petition
interest is allowed in any such proceeding) owing by such Pledgor to the Other
Creditors now existing or hereafter incurred under, arising out of or in
connection with any Secured Hedging Agreement, whether such Secured Hedging
Agreement is now in existence or hereinafter arising (including, in the case of
a Pledgor that is a Guarantor, all obligations, liabilities and indebtedness of
such Pledgor under its Guaranty in respect of the Secured Hedging Agreements),
and the due performance and compliance by such Pledgor with all of the terms,
conditions and agreements contained in each such Secured Hedging Agreement (all
such obligations, liabilities and indebtedness under this clause (ii) being
herein collectively called the “Other Obligations”);

 

(iii)                               any
and all sums advanced by the Pledgee in order to preserve the Collateral (as
hereinafter defined) or preserve its security interest in the Collateral;

 

(iv)                              in
the event of any proceeding for the collection or enforcement of any
indebtedness, obligations or liabilities of such Pledgor referred to in clauses
(i) and (ii) above, after an Event of Default shall have occurred and be
continuing, the reasonable expenses of retaking, holding, preparing for sale or
lease, selling or otherwise disposing of or realizing on the Collateral, or of
any exercise by the Pledgee of its rights hereunder, together with reasonable
attorneys’ fees and court costs; 

 

(v)                                 all
amounts paid by any Indemnitees as to which such Indemnitee has the right to
reimbursement under Section 11 of this Agreement; and

 

(vi)                              all
amounts owing to any Agent or any of its affiliates pursuant to any of the
Credit Documents in its capacity as such;

 

all such obligations, liabilities, indebtedness, sums and expenses set
forth in clauses (i) through (vi) of this Section 1 being collectively called
the “Obligations”, it being agreed that the “Obligations” shall include
extensions of credit of the types described above, whether outstanding on the
date of this Agreement or extended from time to time after the date of this
Agreement.

 

2.                                       DEFINITIONS;
ANNEXES.  (a)  Unless otherwise defined herein, all
capitalized terms used herein and defined in the Credit Agreement shall be used
herein as therein defined.  Reference to
singular terms shall include the plural and vice versa.

 

(b)                                 The
following capitalized terms used herein shall have the definitions specified
below:

 

“Administrative
Agent” shall have the meaning set forth in the recitals hereto.

 

“Adverse
Claim” shall have the meaning given such term in Section 8-102(a)(1) of the
UCC.

 

“Agreement”
shall have the meaning set forth in the first paragraph hereof.

 

“Borrower”
shall have the meaning set forth in the recitals hereto.

 

 

“Certificated
Security” shall have the meaning given such term in Section 8-102(a)(4) of
the UCC.

 

“Clearing
Corporation” shall have the meaning given such term in Section 8-102(a)(5)
of the UCC.

 

“Collateral”
shall have the meaning set forth in Section 3.1 hereof.

 

“Collateral
Accounts” shall mean any and all accounts established and maintained by the
Pledgee in the name of any Pledgor to which Collateral may be credited.

 

“Commodities
Agreement” shall have the meaning provided in the Credit Agreement.

 

“Credit
Agreement” shall have the meaning set forth in the recitals hereto.

 

“Credit
Document Obligations” shall have the meaning set forth in Section 1(i)
hereof.

 

“Domestic
Corporation” shall have the meaning set forth in the definition of “Stock.”

 

“Event
of Default” shall mean any Event of Default under, and as defined in, the
Credit Agreement and shall in any event include, without limitation, any
payment default on any of the Obligations after the expiration of any
applicable grace period.

 

“Excluded
Collateral” shall mean (x) on and after the Accounts Receivable Facility
Transaction Date, any Accounts Receivable Facility Assets for so long as, and
to the extent, same have been sold or transferred pursuant to the Accounts
Receivable Facility Documents, provided that at such time as, and to the
extent that, any such Excluded Collateral is repurchased by or reconveyed to,
an Assignor, such Accounts Receivable Facility Assets shall cease to constitute
Excluded Collateral, (y) Margin Stock owned or held by any Pledgor except to
the extent required to be Pledged pursuant to Section 8.18 of the Credit
Agreement and (z) the capital stock of Yuasa Inc. S.A., EnerSys Europe Ltd. and
YCI Inc. so long as, in the case of EnerSys Europe Ltd. and YCI Inc., the gross
book value of the assets of each entity does not exceed $50,000 at any time.

 

“Exempted
Foreign Corporation” shall mean (i) any Foreign Corporation and any limited
liability company organized under the laws of a jurisdiction other than the
United States or any State or Territory thereof that, in any such case, is
treated as a corporation or an association taxable as a corporation for U.S.
Federal income tax purposes and (ii) Cayman Partnership Shareholder #1.

 

“Financial
Asset” shall have the meaning given such term in Section 8-102(a)(9) of the
UCC.

 

“Foreign
Corporation” shall have the meaning set forth in the definition of “Stock.”

 

“Holdings”
shall have the meaning set forth in the first paragraph hereof.

 

 

“Indemnitees”
shall have the meaning set forth in Section 11 hereof.

 

“Instrument”
shall have the meaning given such term in Section 9-102(a)(47) of the UCC.

 

“Interest
Rate Protection Agreement” shall have the meaning provided in the Credit
Agreement.

 

“Investment
Property” shall have the meaning given such term in Section 9-102(a)(49) of
the UCC.

 

“Lender
Creditors” shall have the meaning set forth in the first paragraph hereof.

 

“Lenders”
shall have the meaning set forth in the Recitals hereto.

 

“Limited
Liability Company Assets” shall mean all assets, whether tangible or
intangible and whether real, personal or mixed (including, without limitation,
all limited liability company capital and interest in other limited liability
companies), at any time owned by any Pledgor or represented by any Limited
Liability Company Interest.

 

“Limited
Liability Company Interests” shall mean the entire limited liability
company membership interest at any time owned by any Pledgor in any limited
liability company.

 

“Location”
of any Pledgor has the meaning given such term in Section 9-307 of the UCC.

 

“Non-Voting
Stock” shall mean all capital stock which is not Voting Stock.

 

“Notes”
shall mean (x) all intercompany notes at any time issued to each Pledgor and
(y) all other promissory notes from time to time issued to, or held by, each
Pledgor.

 

“Obligations”
shall have the meaning set forth in Section 1 hereof.

 

“Other
Creditors” shall have the meaning set forth in the first paragraph hereof.

 

“Other
Hedging Agreement” shall have the meaning provided in the Credit Agreement.

 

“Other
Obligations” shall have the meaning set forth in Section 1(ii) hereof.

 

“Partnership
Assets” shall mean all assets, whether tangible or intangible and whether
real, personal or mixed (including, without limitation, all partnership capital
and interest in other partnerships), at any time owned or represented by any
Partnership Interest.

 

“Partnership
Interest” shall mean the entire general partnership interest or limited
partnership interest at any time owned by any Pledgor in any general
partnership or limited partnership.

 

“Pledged
Notes” shall mean all Notes at any time pledged or required to be pledged
hereunder.

 

 

“Pledgee”
shall have the meaning set forth in the first paragraph hereof.

 

“Pledgor”
shall have the meaning set forth in the first paragraph hereof.

 

“Proceeds”
shall have the meaning given such term in Section 9-102(a)(64) of the UCC.

 

“Registered
Organization” shall have the meaning given such term in Section
9-102(a)(70) of the UCC.

 

“Required
Lenders” shall have the meaning given such term in the Credit Agreement. 

 

“Secured
Creditors” shall have the meaning set forth in the first paragraph hereof.

 

“Secured
Debt Agreements” shall have the meaning set forth in Section 5 hereof.

 

“Secured
Hedging Agreements” shall mean and include each Interest Rate Protection
Agreement, each Commodities Agreement and each Other Hedging Agreement entered
into by the Borrower and/or one or more of its Subsidiaries with any Other
Creditor (including each Existing Interest Rate Protection Agreement).

 

“Securities
Account” shall have the meaning given such term in Section 8-501(a) of the
UCC.

 

“Securities
Act” shall mean the Securities Act of 1933, as amended, as in effect from
time to time.

 

“Securities
Intermediary” shall have the meaning given such term in Section 8-102(14)
of the UCC. 

 

“Security”
and “Securities” shall have the meaning given such term in Section
8-102(a)(15) of the UCC and shall in any event also include all Stock and all
Notes.

 

“Security
Entitlement” shall have the meaning given such term in Section 8-102(a)(17)
of the UCC.

 

“Specified
Default” shall have the meaning set forth in Section 5 hereof.

 

“Stock”
shall mean (x) with respect to corporations incorporated under the laws of the
United States or any State or territory thereof or the District of Columbia
(each, a “Domestic Corporation”), all of the issued and outstanding
shares of capital stock of any Domestic 
Corporation at any time owned by any Pledgor and (y) with respect to
corporations not Domestic Corporations (each, a “Foreign Corporation”),
all of the issued and outstanding shares of capital stock of any Foreign
Corporation at any time owned by any Pledgor.

 

“Termination
Date” shall  have the meaning set
forth in Section 19 hereof.

 

“UCC”
shall mean the Uniform Commercial Code as in effect in the State of
New York from time to time; provided that all references herein to
specific sections or

 

 

subsections of the UCC are references to such sections or subsections,
as the case may be, of the Uniform Commercial Code as in effect in the State of
New York on the date hereof.

 

“Uncertificated
Security” shall have the meaning given such term in Section 8-102(a)(18) of
the UCC.

 

“Voting
Stock” shall  mean all classes of
equity interests of any Foreign Corporation entitled to vote (as used in the
Treasury Regulations under Section 956 under the Code).

 

3.                                       PLEDGE
OF SECURITY INTEREST, ETC.

 

3.1.                              Pledge.  To
secure the Obligations now or hereafter owed or to be performed by such
Pledgor, each Pledgor does hereby grant, pledge and assign to the Pledgee for
the benefit of the Secured Creditors, and does hereby create a continuing
security interest in favor of the Pledgee for the benefit of the Secured
Creditors in, all of the right, title and interest in and to the following,
whether now existing or hereafter from time to time acquired (collectively, the
“Collateral”):

 

(a)                                  each
of the Collateral Accounts, including any and all assets of whatever type or
kind deposited by such Pledgor in such Collateral Account, whether now owned or
hereafter acquired, existing or arising, including, without limitation, all
Financial Assets, Investment Property, moneys, checks, drafts, Instruments,
Securities or interests therein of any type or nature deposited or required by
the Credit Agreement or any other Secured Debt Agreement to be deposited in
such Collateral Account, and all investments and all certificates and other
Instruments (including depository receipts, if any) from time to time
representing or evidencing the same, and all dividends, interest,
distributions, cash and other property from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all of the
foregoing; 

 

(b)                                 all
Securities owned or held by such Pledgor from time to time and all options and
warrants owned by such Pledgor from time to time to purchase Securities;

 

(c)                                  all
Limited Liability Company Interests owned by such Pledgor from time to time and
all of its right, title and interest in each limited liability company to which
each such Limited Liability Company Interest relates, whether now existing or
hereafter acquired, including, without limitation, to the fullest extent
permitted under the terms and provisions of the documents and agreements
governing such Limited Liability Company Interests and applicable law:

 

(A)                              all
its capital therein and its interest in all profits, losses, Limited Liability
Company Assets and other distributions to which such Pledgor shall at any time
be entitled in respect of such Limited Liability Company Interests;

 

(B)                                all
other payments due or to become due to such Pledgor in respect of Limited
Liability Company Interests, whether under any limited liability company
agreement or otherwise, whether as contractual obligations, damages, insurance
proceeds or otherwise;

 

 

(C)                                all
of its claims, rights, powers, privileges, authority, options, security
interests, liens and remedies, if any, under any limited liability company
agreement or operating agreement, or at law or otherwise in respect of such
Limited Liability Company Interests;

 

(D)                               all
present and future claims, if any, of such Pledgor against any such limited
liability company for moneys loaned or advanced, for services rendered or
otherwise;

 

(E)                                 all
of such Pledgor’s rights under any limited liability company agreement or
operating agreement or at law to exercise and enforce every right, power,
remedy, authority, option and privilege of such Pledgor relating to such
Limited Liability Company Interests, including any power to terminate, cancel
or modify any limited liability company agreement or operating agreement, to
execute any instruments and to take any and all other action on behalf of and
in the name of any such Pledgor in respect of such Limited Liability Company
Interests and any such limited liability company, to make determinations, to
exercise any election (including, but not limited to, election of remedies) or
option or to give or receive any notice, consent, amendment, waiver or
approval, together with full power and authority to demand, receive, enforce,
collect or receipt for any of the foregoing or for any Limited Liability
Company Asset, to enforce or execute any checks, or other instruments or
orders, to file any claims and to take any action in connection with any of the
foregoing; and

 

(F)                                 all
other property hereafter delivered in substitution for or in addition to any of
the foregoing, all certificates and instruments representing or evidencing such
other property and all cash, securities, interest, dividends, rights and other
property at any time and from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all thereof;

 

(d)                                 all
Partnership Interests of such Pledgor from time to time and all of its right,
title and interest in each partnership to which each such interest relates,
whether now existing or hereafter acquired, including, without limitation:

 

(A)                              all
its capital therein and its interest in all profits, losses, Partnership Assets
and other distributions to which such Pledgor shall at any time be entitled in
respect of such Partnership Interests;

 

(B)                                all
other payments due or to become due to such Pledgor in respect of Partnership
Interests, whether under any partnership agreement or otherwise, whether as
contractual obligations, damages, insurance proceeds or otherwise;

 

(C)                                all
of its claims, rights, powers, privileges, authority, options, security
interests, liens and remedies, if any, under any partnership agreement or
operating agreement, or at law or otherwise in respect of such Partnership
Interests;

 

(D)                               all
present and future claims, if any, of such Pledgor against any such partnership
for moneys loaned or advanced, for services rendered or otherwise;

 

 

(E)                                 all
of such Pledgor’s rights under any partnership agreement or operating agreement
or at law to exercise and enforce every right, power, remedy, authority, option
and privilege of such Pledgor relating to such Partnership Interests, including
any power to terminate, cancel or modify any partnership agreement or operating
agreement, to execute any instruments and to take any and all other action on
behalf of and in the name of any such Pledgor in respect of such Partnership
Interests and any such partnership, to make determinations, to exercise any
election (including, but not limited to, election of remedies) or option or to
give or receive any notice, consent, amendment, waiver or approval, together with
full power and authority to demand, receive, enforce, collect or receipt for
any of the foregoing or for any Partnership Asset, to enforce or execute any
checks, or other instruments or orders, to file any claims and to take any
action in connection with any of the foregoing; and

 

(F)                                 all
other property hereafter delivered in substitution for or in addition to any of
the foregoing, all certificates and instruments representing or evidencing such
other property and all cash, securities, interest, dividends, rights and other
property at any time and from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all thereof;

 

(G)                                all
Financial Assets and Investment Property of such Pledgor from time to time;

 

(H)                               all
Security Entitlements of such Pledgor from time to time in any and all of the
foregoing; and

 

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

 

provided that (x) no Pledgor shall
be required at any time to pledge hereunder, and the pledge granted hereunder
shall not be deemed to extend to, more than 65% of the total combined voting
power of all classes of Voting Stock of any Exempted Foreign Corporation and
(y) each Pledgor shall be required to pledge hereunder 100% of any Non-Voting
Stock of each Exempted Foreign Corporation at any time and from time to time
acquired by such Pledgor, which Non-Voting Stock shall not be subject to the
limitations described in clause (x). 
Notwithstanding anything to the contrary contained herein, (I) the
Collateral shall at no time include any items which would at such time
constitute Excluded Collateral, and (II) the relative rights and remedies of
the Pledgee shall be subject to and governed by the terms of the Intercreditor
Agreement at any time the Intercreditor Agreement is in effect.  In the event of any inconsistency between
the terms hereof and the Intercreditor Agreement, the Intercreditor Agreement
shall control at any time the Intercreditor Agreement is in effect.

 

3.2.                              Procedures.  (a)  To
the extent that any Pledgor at any time or from time to time owns, acquires or
obtains any right, title or interest in any Collateral, such Collateral shall
automatically (and without the taking of any action by the respective Pledgor)
be pledged pursuant to Section 3.1 of this Agreement and, in addition thereto,
such Pledgor shall (to the extent provided below) take the following actions as
set forth below (as promptly as practicable and, in any event, within 10 days
after it obtains such Collateral) for the benefit of the Pledgee and the
Secured Creditors:

 

 

(i)                                     with
respect to a Certificated Security (other than a Certificated Security credited
on the books of a Clearing Corporation or Securities Intermediary), such
Pledgor shall physically deliver such Certificated Security to the Pledgee,
endorsed to the Pledgee or endorsed in blank;

 

(ii)                                  with
respect to an Uncertificated Security (other than an Uncertificated Security
credited on the books of a Clearing Corporation or Securities Intermediary),
such Pledgor shall cause the issuer of such Uncertificated Security to duly
authorize and execute, and deliver to the Pledgee, an agreement for the benefit
of the Pledgee and the other Secured Creditors substantially in the form of
Annex G hereto (appropriately completed to the satisfaction of the Pledgee and
with such modifications, if any, as shall be satisfactory to the Pledgee)
pursuant to which such issuer agrees to comply with any and all instructions
originated by the Pledgee without further consent by the registered owner and not
to comply with instructions regarding such Uncertificated Security (and any
Partnership Interests and Limited Liability Company Interests issued by such
issuer) originated by any other Person other than a court of competent
jurisdiction;

 

(iii)                               with
respect to a Certificated Security, Uncertificated Security, Partnership
Interest or Limited Liability Company Interest credited on the books of a
Clearing Corporation or Securities Intermediary (including a Federal Reserve
Bank, Participants Trust Company or The Depository Trust Company), the
respective Pledgor shall promptly notify the Pledgee thereof and shall promptly
take all actions (x) required (i) to comply with the applicable rules of such
Clearing Corporation or Securities Intermediary and (ii) to perfect the
security interest of the Pledgee under applicable law (including, in any event,
under Sections 9-314(a), (b), and (c), 9-106 and 8-106(d) of the UCC) and (y)
as the Pledgee deems necessary or desirable to effect the foregoing; 

 

(iv)                              with
respect to a Partnership Interest or a Limited Liability Company Interest
(other than a Partnership Interest or Limited Liability Company Interest
credited on the books of a Clearing Corporation or Securities Intermediary),
(1) if such Partnership Interest or Limited Liability Company Interest is
represented by a certificate and is a Security for purposes of the UCC, the
procedure set forth in Section 3.2(a)(i), and (2) if such Partnership Interest
or Limited Liability Company Interest is not represented by a certificate and
is a Security for purposes of the UCC, the procedure set forth in Section
3.2(a)(ii);

 

(v)                                 with
respect to any Note, physical delivery of such Note to the Pledgee, endorsed to
the Pledgee or endorsed in blank (except that any Note with a face amount of
less than $500,000 shall not be required to be delivered, so long as not more
than $2,500,000 in aggregate principal amount of Notes are excluded pursuant to
the delivery requirements of this clause (v) as a result of such $500,000
limitation); and

 

(vi)                              with
respect to cash proceeds from any of the Collateral, prompt deposit of such
cash in a “Subject Deposit Account” (as such term is defined in

 

 

the Security
Agreement) or, if an Event of Default shall have occurred and be continuing, a
Collateral Account.

 

(b)                                 In
addition to the actions required to be taken pursuant to preceding Section
3.2(a), each Pledgor shall take the following additional actions with respect
to the Securities and Collateral:

 

(i)  with respect to all Collateral of such Pledgor
of which the Pledgee may obtain “control” thereof within the meaning of Section
8-106 of the UCC (or under any provision of the UCC as same may be amended or
supplemented from time to time, or under the laws of any relevant State other
than the State of New York), the respective Pledgor shall take all actions
as may be requested from time to time by the Pledgee so that “control” of such
Collateral is obtained and at all times held by the Pledgee; and 

 

(ii)  each Pledgor shall from time to time cause appropriate
financing statements (on Form UCC-1 or other appropriate form) under the
Uniform Commercial Code as in effect in the various relevant States, in form
covering all Collateral hereunder (with such form to be satisfactory to the
Pledgee), to be filed in the relevant filing offices so that at all times the
Pledgee has a security interest in all Investment Property and other Collateral
which is perfected by the filing of such financing statements (in each case to
the maximum extent perfection by filing may be obtained under the laws of the
relevant States, including, without limitation, Section 9-312(a) of the UCC).

 

3.3.                              Subsequently
Acquired Collateral.  If any Pledgor shall acquire (by purchase,
stock dividend, distribution or otherwise) any additional Collateral at any
time or from time to time after the date hereof, such Collateral shall
automatically (and without any further action being required to be taken) be
subject to the pledge and security interests created pursuant to Section 3.1
and, furthermore, such Pledgor will promptly thereafter take (or cause to be
taken) all action with respect to such Collateral in accordance with the
procedures set forth in Section 3.2, and will promptly thereafter deliver to
the Pledgee (i) a certificate executed by a principal executive officer of such
Pledgor describing such Collateral and certifying that the same has been duly
pledged in favor of the Pledgee (for the benefit of the Secured Creditors)
hereunder and (ii) supplements to Annexes A through F hereto as are necessary
to cause such annexes to be complete and accurate at such time.  Without limiting the foregoing, each Pledgor
shall be required to pledge hereunder any shares of stock of any Exempted
Foreign Corporation at any time and from time to time after the date hereof
acquired by such Pledgor, provided that (x) no Pledgor shall be required
at any time to pledge hereunder more than 65% of the total combined voting
power of all classes of Voting Stock of any Exempted Foreign Corporation, and
(y) each Pledgor shall be required to pledge hereunder 100% of the Non-Voting
Stock of any Exempted Foreign Corporation at any time and from time to time
acquired by such Pledgor. 
Notwithstanding the foregoing, except as otherwise required by Section
8.18 of the Credit Agreement,  no
Pledgor shall be required to Pledge hereunder any Margin Stock owed by such
Pledgor.

 

3.4.                              Transfer
Taxes.  Each pledge of Collateral
under Section 3.1 or Section 3.3 shall be accompanied by any transfer tax
stamps required in connection with the pledge of such Collateral.

 

 

3.5.                              Certain
Representations and Warranties Regarding the Collateral.  Each Pledgor represents and warrants that on
the date hereof: (i) each Subsidiary of such Pledgor, and the direct ownership
thereof, is listed in Annex A hereto; (ii) the Stock (and any warrant or
options to purchase Stock) held by such Pledgor consists of the number and type
of shares of the Stock (and any warrants or options to purchase Stock) of the
corporations as described in Annex B hereto; (iii) such Stock referenced in
clause (ii) of this paragraph constitutes that percentage of the issued and
outstanding capital stock of the issuing corporation as is set forth in Annex B
hereto; (iv) the Notes held by such Pledgor consist of the promissory notes
described in Annex C hereto where such Pledgor is listed as the lender; (v) the
Limited Liability Company Interests held by such Pledgor consist of the number
and type of interests of the Persons described in Annex D hereto; (vi) each
such Limited Liability Company Interest referenced in clause (v) of this
paragraph constitutes that percentage of the issued and outstanding equity
interest of the issuing Person as set forth in Annex D hereto; (vii) the
Partnership Interests held by such Pledgor consist of the number and type of
interests of the Persons described in Annex E hereto; (viii) each such
Partnership Interest referenced in clause (vii) of this paragraph constitutes
that percentage or portion of the entire partnership interest of the Partnership
as set forth in Annex E hereto; (ix) the exact address of each chief executive
office of such Pledgor is listed on Annex F hereto; (x) the Pledgor has
complied with the respective procedure set forth in Section 3.2(a) with respect
to each item of Collateral described in Annexes A through F hereto; and (xi) on
the date hereof, such Pledgor owns no other Securities, Stock, Notes, Limited
Liability Company Interests or Partnership Interests.

 

4.                                       APPOINTMENT
OF SUB-AGENTS; ENDORSEMENTS, ETC.  The Pledgee shall have the
right to appoint one or more sub-agents for the purpose of retaining physical
possession of the Collateral, which may be held (in the discretion of the
Pledgee) in the name of the relevant Pledgor, endorsed or assigned in blank or
in favor of the Pledgee or any nominee or nominees of the Pledgee or a
sub-agent appointed by the Pledgee.

 

5.                                       VOTING,
ETC., WHILE NO EVENT OF DEFAULT OR SPECIFIED DEFAULT.  Unless and
until there shall have occurred and be continuing any Event of Default under
the Credit Agreement or a Default under Section 10.01 or 10.05 of the Credit
Agreement (each such Default, a “Specified Default”), each Pledgor shall
be entitled to exercise all voting rights attaching to any and all Collateral
owned by it, and to give consents, waivers or ratifications in respect thereof,
provided that no vote shall be cast or any consent, waiver or
ratification given or any action taken which would violate, result in breach of
any covenant contained in, or be inconsistent with, any of the terms of this
Agreement, the Credit Agreement, any other Credit Document or any Secured
Hedging Agreement (collectively, the “Secured Debt Agreements”), or
which would have the effect of impairing the value of the Collateral or any
part thereof or the position or interests of the Pledgee or any other Secured
Creditor therein.  All such rights of a
Pledgor to vote and to give consents, waivers and ratifications shall cease in
case an Event of Default shall occur and be continuing and Section 7 hereof
shall become applicable.

 

6.                                       DIVIDENDS
AND OTHER DISTRIBUTIONS.  Unless and until an Event of Default
shall have occurred and be continuing, all cash dividends, cash distributions,
cash Proceeds and other cash amounts payable in respect of the Collateral shall
be paid to the respective Pledgor. 
Subject to Section 3.2 hereof, the Pledgee shall be entitled to receive
directly, and to retain as part of the Collateral:

 

 

(i)                                     all
other or additional stock, notes, certificates, limited liability company
interests, partnership interests, instruments or other securities or property
(including, but not limited to, cash dividends other than as set forth above)
paid or distributed by way of dividend or otherwise in respect of the
Collateral;

 

(ii)                                  all
other or additional stock, notes, certificates, limited liability company
interests, partnership interests, instruments or other securities or property
(including, but not limited to, cash) paid or distributed in respect of the
Collateral by way of stock-split, spin-off, split-up, reclassification,
combination of shares or similar rearrangement; and

 

(iii)                               all
other or additional stock, notes, certificates, limited liability company
interests, partnership interests, instruments or other securities or property
(including, but not limited to, cash) which may be paid in respect of the
Collateral by reason of any consolidation, merger, exchange of stock,
conveyance of assets, liquidation or similar corporate reorganization.

 

Nothing contained in this Section 6 shall limit or restrict in any way
the Pledgee’s right to receive the proceeds of the Collateral in any form in
accordance with Section 3 of this Agreement. 
All dividends, distributions or other payments which are received by the
respective Pledgor contrary to the provisions of this Section 6 or Section 7
shall be received in trust for the benefit of the Pledgee, shall be segregated
from other property or funds of such Pledgor and shall be forthwith paid over
to the Pledgee as Collateral in the same form as so received (with any necessary
endorsement).

 

7.                                       REMEDIES
IN CASE OF AN EVENT OF DEFAULT OR SPECIFIED DEFAULT.  In the
event an Event of Default shall have occurred and be continuing, the Pledgee
shall be entitled to exercise all of the rights, powers and remedies (whether
vested in it by this Agreement or by any other Secured Debt Agreement or by
law) for the protection and enforcement of its rights in respect of the
Collateral, including, without limitation, all the rights and remedies of a
secured party upon default under the UCC and the Pledgee shall be entitled,
without limitation, to exercise any or all of the following rights, which each
Pledgor hereby agrees to be commercially reasonable:

 

(i)                                     to
receive all amounts payable in respect of the Collateral otherwise payable under
Section 6 to such Pledgor;

 

(ii)                                  to
transfer all or any part of the Collateral into the Pledgee’s name or the name
of its nominee or nominees;

 

(iii)                               to
accelerate any Pledged Note which may be accelerated in accordance with its
terms, and take any other lawful action to collect upon any Pledged Note
(including, without limitation, to make any demand for payment thereon);

 

(iv)                              to
vote all or any part of the Collateral (whether or not transferred into the
name of the Pledgee) and give all consents, waivers and ratifications in
respect of the Collateral and otherwise act with respect thereto as though it
were the outright owner thereof (each Pledgor hereby irrevocably constituting
and appointing the Pledgee the proxy and attorney-in-fact of such Pledgor, with
full power of substitution to do so); provided that prior to taking the actions
described in this clause (iv), the Pledgee shall give such Pledgor at least 5
days notice of its intention to do so unless there shall have

 

 

occurred and be continuing
any Default or Event of Default under Section 10.05 of the Credit Agreement, in
which case no such notice to such Pledgor shall be required; 

 

(v)                                 at
any time or from time to time to sell, assign and deliver, or grant options to
purchase, all or any part of the Collateral, or any interest therein, at any
public or private sale, without demand of performance, advertisement or notice
of intention to sell or of the time or place of sale or adjournment thereof or
to redeem or otherwise (all of which are hereby waived by each Pledgor), for
cash, on credit or for other property, for immediate or future delivery without
any assumption of credit risk, and for such price or prices and on such terms
as the Pledgee in its absolute discretion may determine; provided that
at least 10 days’ notice of the time and place of any such sale shall be given
to such Pledgor.  The Pledgee shall not
be obligated to make such sale of Collateral regardless of whether any such
notice of sale has theretofore been given. 
Each purchaser at any such sale shall hold the property so sold
absolutely free from any claim or right on the part of each Pledgor, and each
Pledgor hereby waives and releases to the fullest extent permitted by law any
right or equity of redemption with respect to the Collateral, whether before or
after sale hereunder, all rights, if any, of marshalling the Collateral and any
other security for the Obligations or otherwise, and all rights, if any, of
stay and/or appraisal which it now has or may at any time in the future have
under rule of law or statute now existing or hereafter enacted.  At any such sale, unless prohibited by
applicable law, the Pledgee on behalf of all Secured Creditors (or certain of
them) may bid for and purchase (by bidding in Obligations or otherwise) all or
any part of the Collateral so sold free from any such right or equity of
redemption.  Neither the Pledgee nor any
other Secured Creditor shall be liable for failure to collect or realize upon
any or all of the Collateral or for any delay in so doing nor shall any of them
be under any obligation to take any action whatsoever with regard thereto; and

 

(vi)                              to
set-off any and all Collateral against any and all Obligations, and to withdraw
any and all cash or other Collateral from any and all Collateral Accounts and
to apply such cash and other Collateral to the payment of any and all
Obligations.

 

(b)                                 If
there shall have occurred and be continuing a Specified Default, then and in
every such case but subject to the terms of the Intercreditor Agreement, the
Pledgee shall be entitled to vote (and exercise all rights and powers in
respect of voting) all or any part of the Collateral, (whether or not
transferred into the name of the Pledgee), and give all consents, waivers and
ratifications in respect of the Collateral and otherwise act with respect
thereto as though it were the outright owner thereof (each Pledgor hereby
irrevocably constituting and appointing the Pledgee the proxy and
attorney-in-fact of such Pledgor, with full power of substitution to do so).

 

8.                                       REMEDIES,
ETC., CUMULATIVE.  Each right, power and remedy of the Pledgee
provided for in this Agreement or any other Secured Debt Agreement, or now or
hereafter existing at law or in equity or by statute shall be cumulative and
concurrent and shall be in addition to every other such right, power or
remedy.  The exercise or beginning of
the exercise by the Pledgee or any other Secured Creditor of any one or more of
the rights, powers or remedies provided for in this Agreement or any other
Secured Debt Agreement or now or hereafter existing at law or in equity or by
statute or otherwise shall not preclude the simultaneous or later exercise by
the Pledgee or any other Secured Creditor of all such other rights, powers or
remedies, and no failure or delay on the part of the Pledgee or any other

 

 

Secured Creditor to exercise any such right, power or remedy shall
operate as a waiver thereof.  Unless
otherwise required by the Credit Documents, no notice to or demand on any
Pledgor in any case shall entitle such Pledgor to any other or further notice
or demand in similar other circumstances or constitute a waiver of any of the
rights of the Pledgee or any other Secured Creditor to any other or further
action in any circumstances without demand or notice.  The Secured Creditors agree that this Agreement may be enforced
only by the action of the Pledgee, acting upon the instructions of the Required
Lenders (or, after the date on which all Credit Document Obligations have been
paid in full, the holders of at least a majority of the outstanding Other
Obligations) and that no other Secured Creditor shall have any right
individually to seek to enforce or to enforce this Agreement or to realize upon
the security to be granted hereby, it being understood and agreed that such
rights and remedies may be exercised by the Pledgee or the holders of at least
a majority of the outstanding Other Obligations, as the case may be, for the
benefit of the Secured Creditors upon the terms of this Agreement and the other
Credit Documents.

 

9.                                       APPLICATION
OF PROCEEDS.  (a)  All moneys collected by the Pledgee
upon any sale or other disposition of the Collateral pursuant to the terms of
this Agreement, together with all other moneys received by the Pledgee
hereunder, shall be applied to the payment of the Obligations in the manner
provided in the Security Agreement.

 

(b)  It is understood and agreed that the
Pledgors shall remain jointly and severally liable to the extent of any
deficiency between the amount of proceeds of the Collateral hereunder and the
aggregate amount of the Obligations.

 

10.                                 PURCHASERS
OF COLLATERAL.  Upon any sale of the
Collateral by the Pledgee hereunder (whether by virtue of the power of sale
herein granted, pursuant to judicial process or otherwise), the receipt of the
Pledgee or the officer making such sale of the purchase money paid as
consideration pursuant to such sale shall be a sufficient discharge to the
purchaser or purchasers of the Collateral so sold, and such purchaser or
purchasers shall not be obligated to see to the application of any part of the
purchase money paid over to the Pledgee or such officer or be answerable in any
way for the misapplication or nonapplication thereof.

 

11.                                 INDEMNITY.  Each Pledgor jointly and severally agrees
(i) to indemnify, reimburse and hold harmless the Pledgee and each other
Secured Creditor and their respective successors, assigns, employees, agents
and affiliates (individually an “Indemnitee”, and collectively, the “Indemnitees”)
from and against any and all obligations, damages, injuries, penalties, claims,
demands, losses, judgments and liabilities (including, without limitation,
liabilities for penalties) of whatsoever kind or nature, and (ii) to reimburse
each Indemnitee for all reasonable costs, expenses and disbursements, including
reasonable attorneys’ fees and expenses, in each case arising out of or
resulting from this Agreement or the exercise by any Indemnitee of any right or
remedy granted to it hereunder or under any other Secured Debt Agreement (but excluding
any obligations, damages, injuries, penalties, claims, demands, losses,
judgments and liabilities (including, without limitation, liabilities for
penalties) or expenses of whatsoever kind or nature to the extent incurred or
arising by reason of gross negligence or willful misconduct of such Indemnitee
(as determined by a court of competent jurisdiction in a final and
non-appealable decision)).  In no event
shall the Pledgee hereunder be liable, in the absence of gross negligence or
willful misconduct on its part (as determined by a court of competent
jurisdiction in a final and non-appealable decision), for any matter or thing
in connection with this Agreement other than to account for monies or other
property actually

 

 

received by it in accordance with the terms hereof.  If and to the extent that the obligations of
any Pledgor under this Section 11 are unenforceable for any reason, such
Pledgor hereby agrees to make the maximum contribution to the payment and
satisfaction of such obligations which is permissible under applicable law. The
indemnity obligations of each Pledgor contained in this Section 11 shall
continue in full force and effect notwithstanding the full payment of all the
Notes issued under the Credit Agreement, the termination of all Secured Hedging
Agreements and Letters of Credit, and the payment of all other Obligations and
notwithstanding the discharge thereof.

 

12.                                 FURTHER
ASSURANCES; POWER OF ATTORNEY.  (a)  Each Pledgor
agrees that it will join with the Pledgee in executing and, at such Pledgor’s
own expense, file and refile under the UCC or other applicable law such
financing statements, continuation statements and other documents in such
offices as the Pledgee (acting on its own or on the instructions of the
Required Lenders) may reasonably deem necessary or appropriate and wherever
required or permitted by law in order to perfect and preserve the Pledgee’s
security interest in the Collateral hereunder and hereby authorizes the Pledgee
to file financing statements and amendments thereto relative to all or any part
of the Collateral (including, without limitation, financing statements which
list the Collateral specifically and/or “all assets” as collateral) without the
signature of such Pledgor where permitted by law, and agrees to do such further
acts and things and to execute and deliver to the Pledgee such additional
conveyances, assignments, agreements and instruments as the Pledgee may
reasonably require or deem advisable to carry into effect the purposes of this
Agreement or to further assure and confirm unto the Pledgee its rights, powers
and remedies hereunder or thereunder.

 

(b)  Each Pledgor hereby appoints the Pledgee
such Pledgor’s attorney-in-fact, with full authority in the place and stead of
such Pledgor and in the name of such Pledgor or otherwise, from time to time
after the occurrence and during the continuance of an Event of Default, in the
Pledgee’s discretion to take any action and to execute any instrument which the
Pledgee may deem necessary or advisable to accomplish the purposes of this
Agreement.

 

13.                                 THE
PLEDGEE AS FIRST-LIEN COLLATERAL AGENT.  The Pledgee will hold in
accordance with this Agreement all items of the Collateral at any time received
under this Agreement.  It is expressly
understood, acknowledged and agreed by each Secured Creditor that by accepting
the benefits of this Agreement each such Secured Creditor acknowledges and
agrees that the obligations of the Pledgee as holder of the Collateral and
interests therein and with respect to the disposition thereof, and otherwise
under this Agreement, are only those expressly set forth in this
Agreement.  The Pledgee shall act
hereunder on the terms and conditions set forth herein and in Section 12 of the
Credit Agreement.

 

14.                                 TRANSFER
BY THE PLEDGORS.  No Pledgor will sell or otherwise dispose of,
grant any option with respect to, or mortgage, pledge or otherwise encumber any
of the Collateral or any interest therein (except in accordance with the terms
of this Agreement and the other Secured Debt Agreements).

 

15.                                 REPRESENTATIONS,
WARRANTIES AND COVENANTS OF THE PLEDGORS.  (a)  Each
Pledgor represents, warrants and covenants that:

 

(i)                                     it
is the legal, beneficial and record owner of, and has good and marketable title
to, all Collateral consisting of one or more Securities, Partnership

 

 

Interests and Limited Liability Company Interests and
that it has sufficient interest in all Collateral in which a security interest
is purported to be created hereunder for such security interest to attach
(subject, in each case, to no pledge, lien, mortgage, hypothecation, security
interest, charge, option, Adverse Claim or other encumbrance whatsoever, except
the liens and security interests created by this Agreement); 

 

(ii)                                  it
has full power, authority and legal right to pledge all the Collateral pledged
by it pursuant to this Agreement; 

 

(iii)                               this
Agreement has been duly authorized, executed and delivered by such Pledgor and
constitutes a legal, valid and binding obligation of such Pledgor enforceable
against such Pledgor in accordance with its terms, except to the extent that
the enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws generally affecting creditors’
rights and by equitable principles (regardless of whether enforcement is sought
in equity or at law); 

 

(iv)                              except
to the extent already obtained or made (or, in the case of the filing of UCC-1
Financing Statements, as will be made within 10 days of the Initial Borrowing
Date), no consent of any other party (including, without limitation, any
stockholder, member, partner or creditor of such Pledgor or any of its
Subsidiaries) and no consent, license, permit, approval or authorization of,
exemption by, notice or report to, or registration, filing or declaration with,
any governmental authority is required to be obtained by such Pledgor in
connection with (a) the execution, delivery or performance of this Agreement,
(b) the validity or enforceability of this Agreement (except as set forth in
clause (iii) above), (c) the perfection or enforceability of the Pledgee’s
security interest in the Collateral or (d) except for compliance with or as may
be required by applicable securities laws, the exercise by such Pledgee of any
of its rights or remedies provided herein; 

 

(v)                                 neither
the execution, delivery and performance by such Pledgor of this Agreement nor
compliance by such Pledgor with the terms and provisions hereof, nor the
consummation of the transactions contemplated herein, will contravene any
material provision of any material applicable law, statute, rule or regulation
or any order, judgment, writ, injunction, award or decree of any court,
arbitrator or governmental authority, domestic or foreign, applicable to such
Pledgor, or violate any provision of the certificate of incorporation, by-laws,
operating agreement, certificate of partnership, partnership agreement,
certificate of limited liability company or limited liability company agreement
of such Pledgor or any of its Subsidiaries or of any securities issued by such
Pledgor or any of its Subsidiaries, nor, except as specifically described on
Schedule XII of the Credit Agreement will it in any material respect conflict
or be inconsistent with or result in any breach of, any of the terms,
covenants, conditions or provisions, or constitute a default under or, (other
than pursuant to this Agreement) result in the creation or imposition of (or
the obligation to create or impose) any lien or encumbrance (other than the
Liens created by the Security Documents) upon any of the property or assets of
such Pledgor or any of its Subsidiaries pursuant to the terms of any mortgage,
deed of trust, indenture, lease, loan agreement, credit agreement or any other
material contract, agreement, instrument or undertaking to which such Pledgor
or any of its Subsidiaries is a party or by which it or any of its assets are
bound or to which it may be subject (including, without limitation, the
Existing Indebtedness Agreements); 

 

 

(vi)                              all
of the Collateral (consisting of Securities, Limited Liability Company
Interests or Partnership Interests) has been duly and validly issued, is fully
paid and non-assessable and is subject to no options to purchase or similar
rights;

 

(vii)                           each of
the Pledged Notes constitutes, or when executed by the obligor thereof will
constitute, the legal, valid and binding obligation of such obligor,
enforceable in accordance with its terms, except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws generally affecting creditors’
rights and by equitable principles (regardless of whether enforcement is sought
in equity or at law);  

 

(viii)                        the
pledge, collateral assignment and delivery to the Pledgee of the Collateral
consisting of Certificated Securities and Pledged Notes pursuant to this
Agreement creates a valid and perfected first priority security interest in
such Securities, and the proceeds thereof, subject to no prior Lien or encumbrance
or to any agreement purporting to grant to any third party a Lien or
encumbrance on the property or assets of such Pledgor which would include the
Securities and the Pledgee is entitled to all the rights, priorities and
benefits afforded by the UCC or other relevant law as enacted in any relevant
jurisdiction to perfect security interests in respect of such Collateral; and

 

(ix)                                “control”
(as defined in Section 8-106 of the UCC) has been obtained by the Pledgee over
all Collateral consisting of Securities (including Notes which are Securities)
with respect to which such “control” may be obtained pursuant to Section 8-106
of the UCC.

 

(b)  Each
Pledgor covenants and agrees that it will defend the Pledgee’s right, title and
security interest in and to the Securities and the proceeds thereof against the
claims and demands of all persons whomsoever; and each Pledgor covenants and
agrees that it will have like title to and right to pledge any other property
at any time hereafter pledged to the Pledgee as Collateral hereunder and will
likewise defend the right thereto and security interest therein of the Pledgee
and the other Secured Creditors.

 

(c)  Each
Pledgor covenants and agrees that it will take no action which would violate
any of the terms of any Secured Debt Agreement.

 

16.                                 LEGAL
NAMES; TYPE OF ORGANIZATION (AND WHETHER A REGISTERED ORGANIZATION AND/OR A
TRANSMITTING UTILITY); JURISDICTION OF ORGANIZATION; LOCATION; ORGANIZATIONAL
IDENTIFICATION NUMBERS; CHANGES THERETO; ETC.  The exact legal name of each Pledgor, the type of organization of
such Pledgor, whether or not such Pledgor is a Registered Organization, the
jurisdiction of organization of such Pledgor, such Pledgor’s Location, the
organizational identification number (if any) of each Pledgor, and whether or
not such Pledgor is a Transmitting Utility, is listed on Annex A hereto for
such Pledgor.  No Pledgor shall change
its legal name, its type of organization, its status as a Registered
Organization (in the case of a Registered Organization), its status as a
Transmitting Utility or as a Person which is not a Transmitting Utility, as the
case may be, its jurisdiction of organization, its Location, or its
organizational identification number (if any), except that any such changes
shall be permitted (so long as not in violation of the applicable requirements
of the Secured Debt Agreements and so long as same do not involve (x) a
Registered Organization ceasing to constitute same or (y) any Pledgor changing
its jurisdiction

 

 

of organization or Location from the United States or a State thereof
to a jurisdiction of organization or Location, as the case may be, outside the
United States or a State thereof) if (i) it shall have given to the Collateral
Agent not less than 15 days’ prior written notice of each change to the
information listed on Annex A (as adjusted for any subsequent changes thereto
previously made in accordance with this sentence), together with a supplement
to Annex A which shall correct all information contained therein for such Pledgor,
and (ii) in connection with the respective such change or changes, it shall
have taken all action reasonably requested by the Collateral Agent to maintain
the security interests of the Collateral Agent in the Collateral intended to be
granted hereby at all times fully perfected and in full force and effect.  In addition, to the extent that any Pledgor
does not have an organizational identification number on the date hereof and
later obtains one, such Pledgor shall promptly thereafter deliver a notification
to the Collateral Agent of such organizational identification number and shall
take all actions reasonably satisfactory to the Collateral Agent to the extent
necessary to maintain the security interest of the Collateral Agent in the
Collateral intended to be granted hereby fully perfected and in full force and
effect.

 

17.                                 PLEDGORS’
OBLIGATIONS ABSOLUTE, ETC.  The obligations of each Pledgor under
this Agreement shall be absolute and unconditional and shall remain in full
force and effect without regard to, and shall not be released, suspended,
discharged, terminated or otherwise affected by, any circumstance or occurrence
whatsoever (other than termination of this Agreement pursuant to Section 19
hereof), including, without limitation: 

 

(i)                                     any
renewal, extension, amendment or modification of, or addition or supplement to
or deletion from any Secured Debt Agreement (other than this Agreement in
accordance with its terms), or any other instrument or agreement referred to
therein, or any assignment or transfer of any thereof; 

 

(ii)                                  any
waiver, consent, extension, indulgence or other action or inaction under or in
respect of any such agreement or instrument or this Agreement (other than a
waiver, consent or extension with respect to this Agreement in accordance with
its terms);

 

(iii)                               any
furnishing of any additional security to the Pledgee or its assignee or any
acceptance thereof or any release of any security by the Pledgee or its
assignee; 

 

(iv)                              any
limitation on any party’s liability or obligations under any such instrument or
agreement or any invalidity or unenforceability, in whole or in part, of any
such instrument or agreement or any term thereof; or 

 

(v)                                 any
bankruptcy, insolvency, reorganization, composition, adjustment, dissolution,
liquidation or other like proceeding relating to any Pledgor or any Subsidiary
of any Pledgor, or any action taken with respect to this Agreement by any
trustee or receiver, or by any court, in any such proceeding, whether or not
such Pledgor shall have notice or knowledge of any of the foregoing.

 

18.                                 REGISTRATION,
ETC.  (a)  If an Event of Default shall have occurred
and be continuing and any Pledgor shall have received from the Pledgee a
written request or requests that such Pledgor cause any registration, qualification
or compliance under any federal or state securities law or laws to be effected
with respect to all or any part of the Collateral

 

 

consisting of Securities, Limited Liability Company Interests or
Partnership Interests, such Pledgor as soon as practicable and at its expense
will use its best efforts to cause such registration to be effected (and be
kept effective) and will use its best efforts to cause such qualification and
compliance to be effected (and be kept effective) as may be so requested and as
would permit or facilitate the sale and distribution of such Collateral
consisting of Securities, Limited Liability Company Interests or Partnership
Interests, including, without limitation, registration under the Securities Act
of 1933, as then in effect (or any similar statute then in effect), appropriate
qualifications under applicable blue sky or other state securities laws and
appropriate compliance with any other governmental requirements; provided,
that the Pledgee shall furnish to such Pledgor such information regarding the
Pledgee as such Pledgor may request in writing and as shall be required in
connection with any such registration, qualification or compliance.  Each Pledgor will cause the Pledgee to be
kept reasonably advised in writing as to the progress of each such
registration, qualification or compliance and as to the completion thereof,
will furnish to the Pledgee such number of prospectuses, offering circulars and
other documents incident thereto as the Pledgee from time to time may
reasonably request, and will indemnify, to the extent permitted by law, the
Pledgee and all other Secured Creditors participating in the distribution of
such Collateral consisting of Securities, Limited Liability Company Interests
or Partnership Interests against all claims, losses, damages and liabilities
caused by any untrue statement (or alleged untrue statement) of a material fact
contained therein (or in any related registration statement, notification or
the like) or by any omission (or alleged omission) to state therein (or in any
related registration statement, notification or the like) a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as the same may have been caused by an untrue
statement or omission based upon information furnished in writing to such
Pledgor by the Pledgee expressly for use therein. 

 

(b)  If at any time when the Pledgee shall
determine to exercise its right to sell all or any part of the Collateral
consisting of Securities, Limited Liability Company Interests or Partnership
Interests pursuant to Section 7, and such Collateral or the part thereof to be
sold shall not, for any reason whatsoever, be effectively registered under the
Securities Act of 1933, as then in effect, the Pledgee may, in its sole and
absolute discretion, sell such Collateral or part thereof by private sale in
such manner and under such circumstances as the Pledgee may deem necessary or
advisable in order that such sale may legally be effected without such
registration. Without limiting the generality of the foregoing, in any such
event the Pledgee, in its sole and absolute discretion: (i) may proceed to make
such private sale notwithstanding that a registration statement for the purpose
of registering such Collateral or part thereof shall have been filed under such
Securities Act; (ii) may approach and negotiate with a single possible
purchaser to effect such sale; and (iii) may restrict such sale to a purchaser
who will represent and agree that such purchaser is purchasing for its own
account, for investment, and not with a view to the distribution or sale of
such Collateral or part thereof.  In the
event of any such sale, the Pledgee shall incur no responsibility or liability
for selling all or any part of the Collateral at a price which the Pledgee, in
its sole and absolute discretion, may in good faith deem reasonable under the
circumstances, notwithstanding the possibility that a substantially higher
price might be realized if the sale were deferred until the registration as
aforesaid.

 

19.                                 TERMINATION;
RELEASE.  (a)  On the Termination Date (as defined
below), this Agreement shall terminate (provided that all indemnities set forth
herein including, without limitation, in Section 11 hereof shall survive any
such termination) and the Pledgee, at the request and expense of the respective
Pledgor, will execute and deliver to such Pledgor a 

 

 

proper instrument or instruments acknowledging the satisfaction and
termination of this Agreement (including, without limitation, UCC termination
statements and instruments of satisfaction, discharge and/or reconveyance), and
will duly assign, transfer and deliver to such Pledgor (without recourse and
without any representation or warranty) such of the Collateral as may be in the
possession of the Pledgee and as has not theretofore been sold or otherwise
applied or released pursuant to this Agreement, together with any moneys at the
time held by the Pledgee or any of its sub-agents hereunder and, with respect
to any Collateral consisting of an Uncertificated Security (other than an
Uncertificated Security credited on the books of a Clearing Corporation), a
Partnership Interest or a Limited Liability Company Interest, a termination of
the agreement relating thereto executed and delivered by the issuer of such
Uncertificated Security pursuant to Section 3.2(a)(ii) or by the respective
partnership or limited liability company pursuant to Section 3.2(a)(iv).  As used in this Agreement, “Termination
Date” shall mean the date upon which the Total Commitments and all Secured
Hedging Agreements have been terminated, no Letter of Credit or Note is
outstanding (and all Loans have been paid in full), all Letters of Credit have
been terminated, and all other Obligations (provided for in the Credit
Documents for which no claim has been made), other than indemnitees have been
paid in full.

 

(b)  In
the event that any part of the Collateral is sold or otherwise disposed of (to
a Person other than a Credit Party) (x) at any time prior to the time at which
all Credit Document Obligations have been paid in full and all Commitments and
Letters of Credit under the Credit Agreement have been terminated, in
connection with a sale or disposition permitted by Section 9.02 of the Credit
Agreement or is otherwise released at the direction of the Required Lenders (or
all the Lenders if required by Section 13.01 of the Credit Agreement) or (y) at
any time thereafter, to the extent permitted by the other Secured Debt
Agreements, and in the case of clauses (x) and (y), the proceeds of such sale
or disposition (or from such release) are applied in accordance with the terms
of the Credit Agreement or such other Secured Debt Agreement, as the case may
be, to the extent required to be so applied, the Pledgee, at the request and
expense of such Pledgor, will duly assign, transfer and deliver to such Pledgor
(without recourse and without any representation or warranty) such of the
Collateral as is then being (or has been) so sold or released and as may be in
possession of the Pledgee and has not theretofore been released pursuant to
this Agreement and to the extent requested by such Pledgor, deliver UCC
termination statements and instruments of satisfaction, discharge and/or
reconveyance.

 

(c)  At
any time that any Pledgor desires that Collateral be released as provided in
the foregoing Section 19(a) or (b), it shall deliver to the Pledgee a
certificate signed by a principal executive officer of such Pledgor stating
that the release of the respective Collateral is permitted pursuant to Section
19(a) or (b).  If reasonably requested
by the Pledgee (although the Pledgee shall have no obligation to make any such
request), the relevant Pledgor shall furnish appropriate legal opinions (from
counsel reasonably acceptable to the Pledgee) to the effect set forth in the
immediately preceding sentence.  The
Pledgee shall have no liability whatsoever to any Secured Creditor as the
result of any release of Collateral by it as permitted by this Section 19.

 

20.                                 NOTICES,
ETC.  All notices and other communications hereunder shall be in
writing and shall be delivered or mailed by first class mail, postage prepaid,
addressed:

 

(i)                                     if
to any Pledgor, at its address set forth opposite its signature below;

 

 

(ii)                                  if
to the Pledgee, at:

 

Bank of America, N.A., as
First-Lien Collateral Agent

Mailcode CA5-701-05-19

1455 Market Street, 5th Floor

San Francisco, CA 94103

Telephone: (415) 436-3495

Facsimile:  (415) 503-5006

Attention:  Charles Graber

 

with a
copy to:

 

Bank of America, N.A., as
First-Lien Collateral Agent

Mailcode NC1-007-13-06

100 N. Tryon Street, 13th Floor

Charlotte, NC 28255

Telephone: (704) 388-6415

Facsimile:  (704) 409-0564

Attention:  Laura Clark

 

(iii)                               if
to any Lender (other than the Pledgee), at such address as such Lender shall
have specified in the Credit Agreement;

 

(iv)                              if
to any Other Creditor, at such address as such Other Creditor shall have
specified in writing to the Borrower and the Pledgee;

 

or at such address as shall have been furnished in writing by any
Person described above to the party required to give notice hereunder.

 

21.                                 PLEDGEE
NOT A PARTNER OR LIMITED LIABILITY COMPANY MEMBER.  (a)  Nothing herein shall be
construed to make the Pledgee or any other Secured Creditor liable as a member
of any limited liability company or partnership and neither the Pledgee nor any
other Secured Creditor by virtue of this Agreement or otherwise (except as
referred to in the following sentence) shall have any of the duties,
obligations or liabilities of a member of any limited liability company or
partnership.  The parties hereto
expressly agree that, unless the Pledgee shall become the absolute owner of
Collateral consisting of a Limited Liability Company Interest or Partnership
Interest pursuant hereto, this Agreement shall not be construed as creating a
partnership or joint venture among the Pledgee, any other Secured Creditor
and/or any Pledgor.

 

(b)                                 Except
as provided in the last sentence of paragraph (a) of this Section 21, the
Pledgee, by accepting this Agreement, did not intend to become a member of any
limited liability company or partnership or otherwise be deemed to be a
co-venturer with respect to any Pledgor or any limited liability company or
partnership either before or after an Event of Default shall have
occurred.  The Pledgee shall have only
those powers set forth herein and the Secured Creditors shall assume none of
the duties, obligations or liabilities of a member of any limited liability
company or partnership or any Pledgor except as provided in the last sentence
of paragraph (a) of this Section 21.

 

 

(c)                                  The
Pledgee and the other Secured Creditors shall not be obligated to perform or
discharge any obligation of any Pledgor as a result of the pledge hereby
effected.

 

(d)                                 The
acceptance by the Pledgee of this Agreement, with all the rights, powers,
privileges and authority so created, shall not at any time or in any event
obligate the Pledgee or any other Secured Creditor to appear in or defend any
action or proceeding relating to the Collateral to which it is not a party, or
to take any action hereunder or thereunder, or to expend any money or incur any
expenses or perform or discharge any obligation, duty or liability under the
Collateral.

 

22.                                 WAIVER;
AMENDMENT.  Except as contemplated
by Sections 19 and 28 hereof, none of the terms and conditions of this
Agreement may be changed, waived, discharged or terminated in any manner
whatsoever unless such change, waiver, discharge or termination is in writing
duly signed by each Pledgor directly and adversely affected thereby and the
Collateral Agent(with the consent of (x) the Required Lenders (or, to the
extent required by Section 13.01 of the Credit Agreement, all of the Lenders)
at all times prior to the time at which all Credit Document Obligations (other
than those arising from indemnities for which no request has been made) have
been paid in full and all Commitments and Letters of Credit under the Credit
Agreement have been terminated or (y) the holders of at least a majority of the
outstanding Other Obligations at all times after the time at which all Credit
Document Obligations (other than those arising from indemnities for which no
request has been made) have been paid in full and all Commitments and Letters
of Credit under the Credit Agreement have been terminated, provided that
any change, waiver, modification or variance affecting the rights and benefits
of a single Class (as defined below) of Secured Creditors (and not all Secured
Creditors in a like or similar manner) shall require the written consent of the
Requisite Creditors (as defined below) of such Class of Secured Creditors.  For the purpose of this Agreement, the term
“Class” shall mean each class of Secured Creditors, i.e., whether (x)
the Lender Creditors as holders of the Credit Document Obligations or  (y) the Other Creditors as holders of the
Other Obligations.  For the purpose of
this Agreement, the term “Requisite Creditors” of any Class shall mean each of
(x) with respect to each of the Credit Document Obligations, the Required
Lenders and (y) with respect to the Other Obligations, the holders of more than
50% of all obligations outstanding from time to time under the Secured Hedging
Agreements.

 

23.                                 MISCELLANEOUS.  This
Agreement shall create a continuing security interest in the Collateral and
shall (i) remain in full force and effect, subject to release and/or
termination as set forth in Section 19, (ii) be binding upon each Pledgor, its
successors and assigns; provided, however, that no Pledgor shall
assign any of its rights or obligations hereunder without the prior written
consent of the Pledgee (with the prior written consent of the Required Lenders
or to the extent required by Section 13.01 of the Credit Agreement, all of the
Lenders), and (iii) inure, together with the rights and remedies of the Pledgee
hereunder, to the benefit of the Pledgee, the other Secured Parties and their
respective successors, transferees and assigns. 
The headings of the several sections and subsections in this
Agreement are for purposes of reference only and shall not limit or define the
meaning hereof.  This Agreement may be
executed in any number of counterparts, each of which shall be an original, but
all of which together shall constitute one instrument.  In the event that any provision of this
Agreement shall prove to be invalid or unenforceable, such provision shall be
deemed to be severable from the other provisions of this Agreement which shall
remain binding on all parties hereto. 
All agreements, statements, representations and warranties made by each
Pledgor herein or in any certificate or other instrument delivered by such
Pledgor or on its behalf under this Agreement

 

 

shall be considered to have been relied upon by the Secured Creditors
and shall survive the execution and delivery of this Agreement and the other
Secured Debt Agreements regardless of any investigation made by the Secured
Creditors or on their behalf.

 

24.                                 GOVERNING
LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL.   
(A)  THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK.  ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR
ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK
OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK, IN EACH CASE
WHICH ARE LOCATED IN THE COUNTY OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF
THIS AGREEMENT, EACH PLEDGOR HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE
JURISDICTION OF THE AFORESAID COURTS. EACH PLEDGOR HEREBY FURTHER IRREVOCABLY
WAIVES ANY CLAIM THAT ANY SUCH COURTS LACK PERSONAL JURISDICTION OVER SUCH
PLEDGOR, AND AGREES NOT TO PLEAD OR CLAIM IN ANY LEGAL ACTION OR PROCEEDING
WITH RESPECT TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN ANY OF
THE AFORESAID COURTS THAT ANY SUCH COURT LACKS PERSONAL JURISDICTION OVER SUCH
PLEDGOR.  EACH PLEDGOR FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED
COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY
REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO ANY SUCH PLEDGOR AT ITS
ADDRESS FOR NOTICES AS PROVIDED IN SECTION 20 ABOVE, SUCH SERVICE TO BECOME
EFFECTIVE 30 DAYS AFTER SUCH MAILING. 
EACH PLEDGOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION TO SUCH SERVICE OF
PROCESS AND FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY
ACTION OR PROCEEDING COMMENCED HEREUNDER OR UNDER ANY OTHER CREDIT DOCUMENT
THAT SUCH SERVICE OF PROCESS WAS IN ANY WAY INVALID OR INEFFECTIVE.  NOTHING HEREIN SHALL AFFECT THE RIGHT OF THE
PLEDGEE UNDER THIS AGREEMENT, OR ANY SECURED CREDITOR, TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE
PROCEED AGAINST ANY PLEDGOR IN ANY OTHER JURISDICTION.

 

(B)                                EACH
PLEDGOR HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS
ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER CREDIT
DOCUMENT BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY
FURTHER IRREVOCABLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT
THAT ANY SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM.

 

 

(C)                                EACH
OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO
THIS AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY.

 

25.                                 ADDITIONAL
PLEDGORS.  It is understood and agreed that any Subsidiary of the
Borrower that is required to become a party to this Agreement after the date
hereof pursuant to the requirements of the Credit Agreement shall automatically
become a Pledgor hereunder by (x) executing a counterpart hereof and/or a
Subsidiary assumption agreement, in each case in form and substance
satisfactory to the Pledgee, (y) delivering supplements to Annexes A through F
hereto as are necessary to cause such Annexes to be complete and accurate with
respect to such additional Pledgor on such date and (z) taking all actions as
specified in Section 3 of this Agreement as would have been taken by such
Pledgor had it been an original party to this Agreement, in each case with all
documents required above to be delivered to the Pledgee and with all documents
and actions required to be taken above to be taken to the reasonable satisfaction
of the Pledgee.

 

26.                                 RECOURSE.  This Agreement is made with full recourse to
the Pledgors and pursuant to and upon all the representations, warranties,
covenants and agreements on the part of the Pledgors contained herein and in
the other Secured Debt Agreements and otherwise in writing in connection
herewith or therewith.

 

27.                                 FRAUDULENT
CONVEYANCE; ETC.  It is the desire
and intent of each Pledgor and the Secured Creditors that this Agreement shall
be enforced against each Pledgor to the fullest extent permissible under the
laws and public policies applied in each jurisdiction in which enforcement is
sought.  Notwithstanding anything to the
contrary contained herein, in furtherance of the foregoing, it is noted that
the obligations of each Pledgor constituting a Subsidiary Guarantor have been
limited as, and to the extent, provided in Section 27 of the Subsidiaries
Guaranty.  

 

28.                                 RELEASE
OF PLEDGORS.  If at any time all of
the Equity Interests of any Pledgor owned by the Borrower or any of its Subsidiaries
are sold (to a Person other than a Credit Party) in a transaction permitted
pursuant to the Credit Agreement (and which does not violate the terms of any
other Secured Debt Agreement then in effect), then, such Pledgor shall be
released as a Pledgor pursuant to this Agreement without any further action
hereunder (it being understood that the sale of all of the equity interests in
any Person that owns, directly or indirectly, all of the equity interests in
any Pledgor shall be deemed to be a sale of all of the equity interests in such
Pledgor for purposes of this Section), and the Pledgee is authorized and
directed to execute and deliver such instruments of release as are reasonably
satisfactory to it.  At any time that
the Borrower desires that a Pledgor be released from this Agreement as provided
in this Section 28, the Borrower shall deliver to the Pledgee a certificate
signed by a principal executive officer of the Borrower stating that the
release of such Pledgor is permitted pursuant to this Section 28.  If requested by Pledgee (although the
Pledgee shall have no obligation to make any such request), the Borrower shall
furnish legal opinions (from counsel acceptable to the Pledgee) to the effect
set forth in the immediately preceding sentence.  The Pledgee shall have no liability whatsoever to any other
Secured Creditor as a result of the release of any Pledgor by it in accordance
with, or which it believes to be in accordance with, this Section 28.

 

 

IN
WITNESS WHEREOF, each Pledgor and the Pledgee have caused this Agreement to be
executed  by  their elected officers duly authorized as of the date first above
written.

 

	
  2366 Bernville Road

  	
  ENERSYS,

  
	
  Reading, PA, 19605

  	
  as a Pledgor

  
	
  Telephone: 
  (610) 208-1991

  	
   

  
	
  Facsimile: 
  (610) 208-1671

  	
   

  
	
  Attention: Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366 Bernville Road

  	
  ENERSYS CAPITAL INC.,

  
	
  Reading, PA, 19605

  	
  as a Pledgor

  
	
  Telephone: 
  (610) 208-1991

  	
   

  
	
  Facsimile: 
  (610) 208-1671

  	
   

  
	
  Attention: Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366 Bernville Road

  	
  ENERSYS DELAWARE INC.,

  
	
  Reading, PA, 19605

  	
  as a Pledgor

  
	
  Telephone: 
  (610) 208-1991

  	
   

  
	
  Facsimile: 
  (610) 208-1671

  	
   

  
	
  Attention: Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366 Bernville Road

  	
  ESFINCO, INC.,

  
	
  Reading, PA, 19605

  	
  as a Pledgor

  
	
  Telephone: 
  (610) 208-1991

  	
   

  
	
  Facsimile: 
  (610) 208-1671

  	
   

  
	
  Attention: Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

	
  2366 Bernville Road

  	
  ESRMCO, INC.,

  
	
  Reading, PA, 19605

  	
  as a Pledgor

  
	
  Telephone: 
  (610) 208-1991

  	
   

  
	
  Facsimile: 
  (610) 208-1671

  	
   

  
	
  Attention: Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366 Bernville Road

  	
  HAWKER ENERGY PRODUCTS INC.,

  
	
  Reading, PA, 19605

  	
  as a Pledgor

  
	
  Telephone: 
  (610) 208-1991

  	
   

  
	
  Facsimile: 
  (610) 208-1671

  	
   

  
	
  Attention: Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366 Bernville Road

  	
  HAWKER POWER SYSTEMS, INC.,

  
	
  Reading, PA, 19605

  	
  as a Pledgor

  
	
  Telephone: 
  (610) 208-1991

  	
   

  
	
  Facsimile: 
  (610) 208-1671

  	
   

  
	
  Attention: Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366 Bernville Road

  	
  POWERSAFE STANDBY BATTERIES INC.,

  
	
  Reading, PA, 19605

  	
  as a Pledgor

  
	
  Telephone: 
  (610) 208-1991

  	
   

  
	
  Facsimile: 
  (610) 208-1671

  	
   

  
	
  Attention: Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366 Bernville Road

  	
  HAWKER POWERSOURCE, INC.,

  
	
  Reading, PA, 19605

  	
  as a Pledgor

  
	
  Telephone: 
  (610) 208-1991

  	
   

  
	
  Facsimile: 
  (610) 208-1671

  	
   

  
	
  Attention: Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

	
  2366 Bernville Road

  	
  NEW PACIFICO REALTY, INC.,

  
	
  Reading, PA, 19605

  	
  as a Pledgor

  
	
  Telephone: 
  (610) 208-1991

  	
   

  
	
  Facsimile: 
  (610) 208-1671

  	
   

  
	
  Attention: Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

 

	
  Accepted and Agreed to:

  	
   

  
	
   

  	
   

  
	
  BANK OF AMERICA, N.A.,

  	
   

  
	
  as First Lien Collateral Agent and Pledgee

  	
   

  
	
   

  	
   

  
	
  By

  	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
				

 

 

SCHEDULE OF LEGAL NAMES, TYPE OF ORGANIZATION

(AND WHETHER A REGISTERED ORGANIZATION AND/OR

A TRANSMITTING UTILITY), JURISDICTION OF ORGANIZATION, 

LOCATION AND ORGANIZATIONAL IDENTIFICATION NUMBERS

 

	
  Exact
  Legal

  Name of Each

  Pledgor

  	
   

  	
  Registered

  Organization?

  (Yes/No)

  	
   

  	
  Jurisdiction of

  Organization

  	
   

  	
  Pledgor’s

  Location (for 

  purposes of NY

  UCC

  § 9-307)

  	
   

  	
  Pledgor’s

  Organization

  Identification

  Number (or, if it

  has none, so

  indicate)

  	
   

  	
  Transmitting

  Utility?

  (Yes/No)

  

 

 

 

LIST OF STOCK

 

 

 

LIST OF NOTES

 

 

 

LIST OF LIMITED LIABILITY
COMPANY INTERESTS

 

 

 

LIST OF PARTNERSHIP
INTERESTS

 

 

 

LIST OF CHIEF EXECUTIVE
OFFICES

 

 

 

Form of Agreement
Regarding Uncertificated Securities, Limited Liability

Company Interests and Partnership Interests

 

AGREEMENT
(as amended, modified or supplemented from time to time, this “Agreement”),
dated as of                ,            , among each of the undersigned
pledgors (each a “Pledgor” and, collectively, the “Pledgors”),                     , not in its individual
capacity but solely as Collateral Agent (the “Pledgee” or “First-Lien
Collateral Agent”), and                 
, as the issuer of the Uncertificated Securities, Limited Liability
Company Interests and/or Partnership Interests (each as defined below) (the “Issuer”).

 

W I T N E S S E T H :

 

WHEREAS,
each Pledgor and the Pledgee are entering into a Pledge Agreement, dated as of
March 17, 2004 (as amended, amended and restated, modified or supplemented from
time to time, the “Pledge Agreement”), under which, among other things,
in order to secure the payment of the Obligations (as defined in the Pledge
Agreement), each Pledgor will pledge to the Pledgee for the benefit of the
Secured Creditors (as defined in the Pledge Agreement), and grant a security
interest in favor of the Pledgee for the benefit of the Secured Creditors in,
all of the right, title and interest of such Pledgor in and to any and all (1)
“uncertificated securities” (as defined in Section 8-102(a)(18) of the Uniform
Commercial Code, as adopted in the State of New York) (“Uncertificated
Securities”), (2) Partnership Interests (as defined in the Pledge
Agreement) and (3) Limited Liability Company Interests (as defined in the
Pledge Agreement), in each case issued from time to time by the Issuer, whether
now existing or hereafter from time to time acquired by such Pledgor (with all of
such Uncertificated Securities, Partnership Interests and Limited Liability
Company Interests being herein collectively called the “Issuer Pledged
Interests”); and

 

WHEREAS,
each Pledgor desires the Issuer to enter into this Agreement in order to perfect
the security interest of the Pledgee under the Pledge Agreement in the Issuer
Pledged Interests, to vest in the Pledgee control of the Issuer Pledge
Interests and to provide for the rights of the parties under this Agreement;

 

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

 

1.  Each Pledgor hereby irrevocably authorizes
and directs the Issuer, and the Issuer hereby agrees, to comply with any and
all instructions and orders originated by the Pledgee (and its successors and
assigns) regarding any and all of the Issuer Pledged Interests without the
further consent by the registered owner (including the respective Pledgor), and
not to comply with any instructions or orders regarding any or all of the
Issuer Pledged Interests originated by any person or entity other than the
Pledgee (and its successors and assigns) or a court of competent jurisdiction.

 

2.  The Issuer hereby certifies that (i) no
notice of any security interest, lien or other encumbrance or claim affecting
the Issuer Pledged Interests (other than the security interest

 

 

of the Pledgee) has been received by it, and (ii) the security interest
of the Pledgee in the Issuer Pledged Interests has been registered in the books
and records of the Issuer.

 

3.  The Issuer hereby represents and warrants
that (i) the pledge by the Pledgors of, and the granting by the Pledgors of a
security interest in, the Issuer Pledged Interests to the Pledgee, for the
benefit of the Secured Creditors, does not violate the charter, by-laws,
partnership agreement, membership agreement or any other agreement governing
the Issuer or the Issuer Pledged Interests, and (ii) the Issuer Pledged
Interests are fully paid and nonassessable.

 

4.  All notices, statements of accounts,
reports, prospectuses, financial statements and other communications to be sent
to any Pledgor by the Issuer in respect of the Issuer will also be sent to the
Pledgee at the following address:

 

Bank of America, N.A., as
First-Lien Collateral Agent and Pledgee

Mailcode CA5-701-05-19

1455 Market Street, 5th
Floor

San Francisco, CA 94103

Telephone: (415) 436-3495

Facsimile:  (415) 503-5006

Attention:  Charles Graber

 

with a
copy to:

 

Bank of America, N.A., as
First-Lien Collateral Agent and Pledgee

Mailcode NC1-007-13-06

100 N. Tryon Street, 13th
Floor

Charlotte, NC 28255

Telephone: (704) 388-6415

Facsimile:  (704) 409-0564

Attention:  Laura Clark

 

5.  Until the Pledgee shall have delivered
written notice to the Issuer that all of the Obligations have been paid in full
and this Agreement is terminated, the Issuer will send any and all redemptions,
distributions, interest or other payments in respect of the Issuer Pledged
Interests from the Issuer for the account of the Pledgor only by wire transfers
to the following address:

 

 

	
   

  
	
   

  
	
   

  
	
   

  
	
  [Account Information]

  	
   

  
	
  ABA No.:

  	
   

  
	
  Account in the Name of:

  	
   

  
	
  Account No.:

  	
   

  
	
   

  
					

6.  Except as expressly provided otherwise in
Sections 4 and 5, all notices, instructions, orders and communications
hereunder shall be sent or delivered by mail, telex,

 

 

telecopy or overnight courier service and all such notices and
communications shall, when mailed, telexed, telecopied or sent by overnight
courier, be effective when deposited in the mails or delivered to the overnight
courier, prepaid and properly addressed for delivery on such or the next
Business Day, or sent by telex or telecopier, except that notices and
communications to the Pledgee shall not be effective until received by the
Pledgee.  All notices and other
communications shall be in writing and addressed as follows:

 

(a)                                  if
to any Pledgor, at:

 

(b)                                 if
to the Pledgee, at the address given in Section 4 hereof:

 

 (c)                               if to the Issuer, at:

 

 

 

	
   

  
	
   

  
	
   

  
	
   

  
	
  Attention:

  	
   

  
	
  Telephone No.:

  	
   

  
	
  Telecopier No.:

  	
   

  
	
   

  
			

 

or at such other address
as shall have been furnished in writing by any Person described above to the
party required to give notice hereunder. 
As used in this Section 6, “Business Day” means any day other
than a Saturday, Sunday, or other day in which banks in New York are authorized
to remain closed.

 

7.  This Agreement shall be binding upon the
successors and assigns of each Pledgor and the Issuer and shall inure to the
benefit of and be enforceable by the Pledgee and its successors and
assigns.  This Agreement may be executed
in any number of counterparts, each of which shall be an original, but all of
which shall constitute one instrument. 
In the event that any provision of this Agreement shall prove to be
invalid or unenforceable, such provision shall be deemed to be severable from
the other provisions of this Agreement which shall remain binding on all
parties hereto.  None of the terms and
conditions of this Agreement may be changed, waived, modified or varied in any
manner whatsoever except in writing signed by the Pledgee, the Issuer and any
Pledgor which at such time owns any Issuer Pledged Interests.

 

8.  This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without regard
to its principles of conflict of laws.

 

 

IN
WITNESS WHEREOF, each Pledgor, the Pledgee and the Issuer have caused this
Agreement to be executed by their duly elected officers duly authorized as of
the date first above written.

 

	
   

  	
  [

  	
   

  	
  ],

  
	
   

  	
  as Pledgor

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A.,

  
	
   

  	
  not in its individual
  capacity but solely as

  Collateral Agentand Pledgee

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  [

  	
   

  	
  ],

  
	
   

  	
  as the Issuer

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:Exhibit 10.11

 

 

 

SECURITY AGREEMENT

 

among

 

ENERSYS,

 

VARIOUS SUBSIDIARIES OF ENERSYS

 

and

 

BANK OF AMERICA, N.A.,

as First-Lien Collateral Agent

 

Dated as of March 17, 2004

 

 

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I SECURITY INTERESTS

  	
   

  
	
   

  	
   

  
	
  1.1. Grant of Security
  Interests

  	
   

  
	
  1.2.
  Power of Attorney

  	
   

  
	
   

  	
   

  
	
  ARTICLE II GENERAL REPRESENTATIONS,
  WARRANTIES AND COVENANTS

  	
   

  
	
   

  	
   

  
	
  2.1.
  Necessary Filings

  	
   

  
	
  2.2. No Liens

  	
   

  
	
  2.3. Other Financing
  Statements

  	
   

  
	
  2.4. Chief Executive
  Office; Records

  	
   

  
	
  2.5. Location of
  Inventory and Equipment

  	
   

  
	
  2.6. Recourse

  	
   

  
	
  2.7. Legal
  Names; Type of Organization (and Whether a Registered Organization and/or a
  Transmitting Utility); Jurisdiction of Organization; Location; Organizational
  Identification Numbers; Changes Thereto; etc.

  	
   

  
	
  2.8. Trade
  Names; Etc.

  	
   

  
	
  2.9. Certain Significant
  Transactions

  	
   

  
	
  2.10.
  Non-UCC Property

  	
   

  
	
  2.11. As-Extracted Collateral;
  Timber-to-be-Cut

  	
   

  
	
  2.12. Collateral in
  the Possession of a Bailee

  	
   

  
	
   

  	
   

  
	
  ARTICLE III SPECIAL PROVISIONS CONCERNING
  RECEIVABLES; CONTRACT RIGHTS; INSTRUMENTS

  	
   

  
	
   

  	
   

  
	
  3.1.
  Additional Representations and Warranties

  	
   

  
	
  3.2. Maintenance of Records

  	
   

  
	
  3.3.
  Direction to Account Debtors; Contracting Parties; etc.

  	
   

  
	
  3.4. Modification of Terms;
  etc.

  	
   

  
	
  3.5.
  Collection

  	
   

  
	
  3.6.
  Instruments

  	
   

  
	
  3.7.
  Further Actions

  	
   

  
	
  3.8. Assignors
  Remain Liable Under Contracts

  	
   

  
	
  3.9. Deposit Accounts; Etc.

  	
   

  
	
  3.10. Letter-of-Credit Rights

  	
   

  
	
  3.11. Commercial Tort Claims

  	
   

  
	
  3.12.
  Chattel Paper

  	
   

  
	
  3.13. Further
  Actions

  	
   

  
	
   

  	
   

  
	
  ARTICLE IV SPECIAL PROVISIONS CONCERNING
  TRADEMARKS AND DOMAIN NAMES

  	
   

  
	
   

  	
   

  
	
  4.1. Additional
  Representations and Warranties

  	
   

  
	
  4.2. Licenses and Assignments

  	
   

  

 

i

 

	
  4.3.
  Infringements

  	
   

  
	
  4.4. Preservation of Marks

  	
   

  
	
  4.5. Maintenance of
  Registration

  	
   

  
	
  4.6. Future
  Registered Marks

  	
   

  
	
  4.7. Remedies

  	
   

  
	
   

  	
   

  
	
  ARTICLE V SPECIAL PROVISIONS CONCERNING
  PATENTS, COPYRIGHTS AND TRADE SECRETS

  	
   

  
	
   

  	
   

  
	
  5.1. Additional
  Representations and Warranties

  	
   

  
	
  5.2.
  Licenses and Assignments

  	
   

  
	
  5.3.
  Infringements

  	
   

  
	
  5.4. Maintenance
  of Patents and Copyrights

  	
   

  
	
  5.5. Prosecution of
  Patent or Copyright Applications

  	
   

  
	
  5.6. Other Patents and
  Copyrights

  	
   

  
	
  5.7. Remedies

  	
   

  
	
   

  	
   

  
	
  ARTICLE VI PROVISIONS CONCERNING ALL
  COLLATERAL

  	
   

  
	
   

  	
   

  
	
  6.1. Protection of
  First-Lien Collateral Agent’s Security

  	
   

  
	
  6.2. Warehouse
  Receipts Non-Negotiable

  	
   

  
	
  6.3.
  Further Actions

  	
   

  
	
  6.4. Financing Statements

  	
   

  
	
  6.5. Additional Information

  	
   

  
	
   

  	
   

  
	
  ARTICLE VII REMEDIES UPON OCCURRENCE OF
  EVENT OF DEFAULT

  	
   

  
	
   

  	
   

  
	
  7.1.
  Remedies; Obtaining the Collateral Upon Default

  	
   

  
	
  7.2. Remedies;
  Disposition of the Collateral

  	
   

  
	
  7.3.
  Waiver of Claims

  	
   

  
	
  7.4. Application of Proceeds

  	
   

  
	
  7.5. Remedies Cumulative

  	
   

  
	
  7.6. Discontinuance of
  Proceedings

  	
   

  
	
   

  	
   

  
	
  ARTICLE VIII INDEMNITY

  	
   

  
	
   

  	
   

  
	
  8.1. Indemnity

  	
   

  
	
  8.2.
  Indemnity Obligations Secured by Collateral; Survival

  	
   

  
	
   

  	
   

  
	
  ARTICLE IX DEFINITIONS

  	
   

  
	
   

  	
   

  
	
  ARTICLE X MISCELLANEOUS

  	
   

  
	
   

  	
   

  
	
  10.1. Notices

  	
   

  
	
  10.2.
  Waiver; Amendment

  	
   

  
	
  10.3. Obligations Absolute

  	
   

  
	
  10.4. Successors and Assigns

  	
   

  
	
  10.5. Headings Descriptive

  	
   

  
	
  10.6.
  Governing Law

  	
   

  
	
  10.7.
  Assignor’s Duties

  	
   

  

 

ii

 

	
  10.8. Termination; Release

  	
   

  
	
  10.9.
  Counterparts

  	
   

  
	
  10.10. The First-Lien
  Collateral Agent

  	
   

  
	
  10.11.
  Severability

  	
   

  
	
  10.12. Fraudulent
  Conveyance; Etc.

  	
   

  
	
  10.13. Additional Assignors

  	
   

  

 

	
  ANNEX A

  	
  Schedule of Chief Executive Offices/Record
  Locations

  
	
  ANNEX B

  	
  Schedule of Inventory and Equipment
  Locations

  
	
  ANNEX C

  	
  Schedule of Legal Names, Type of Organization
  (and whether a Registered Organization and/or a Transmitted Utility),
  Jurisdiction of Organization, Location and Organizational Identification
  Numbers

  
	
  ANNEX D

  	
  Schedule of Trade and Fictitious Names

  
	
  ANNEX E

  	
  Description of certain Significant
  Transactions occurring within one year prior to the date of the Security
  Agreement

  
	
  ANNEX F

  	
  Schedule of Deposit Accounts

  
	
  ANNEX G

  	
  Form of Control Agreement Regarding Deposit
  Accounts

  
	
  ANNEX H

  	
  Description of Commercial Tort Claims

  
	
  ANNEX I

  	
  Schedule of Marks and Applications; Domain
  Name Registrations

  
	
  ANNEX J

  	
  Schedule of Patents and Applications

  
	
  ANNEX K

  	
  Schedule of Copyrights and Applications

  
	
  ANNEX L

  	
  Form of Grant of Security Interest in
  Certain Patents and Trademarks

  
	
  ANNEX M

  	
  Form of Grant of Security Interest in
  Certain Copyrights

  

 

iii

 

SECURITY AGREEMENT

 

SECURITY AGREEMENT, dated as of March 17, 2004 (as the same may be
amended, restated, modified and/or supplemented from time to time in accordance
with the terms hereof, this “Agreement”), among each of the undersigned
(each, an “Assignor” and, together with each other entity which becomes
a party hereto pursuant to Section 10.13, collectively, the “Assignors”)
and Bank of America, N.A., as First-Lien Collateral Agent (the “First-Lien
Collateral Agent”), for the benefit of the Secured Creditors (as defined
below).  Except as otherwise defined
herein, terms used herein and defined in the Credit Agreement (as defined
below) shall be used herein as therein defined.

 

W I T N E S S E T H:

 

WHEREAS, EnerSys (“Holdings”), EnerSys Capital Inc. (the “Borrower”),
various financial institutions from time to time party thereto (the “Lenders”)
and Bank of America, N.A., as Administrative Agent (in such capacity, the “Administrative
Agent” and, together with the Lenders, the First-Lien Collateral Agent,
each Letter of Credit Issuer, the Documentation Agent, the Syndication Agent
and the Pledgee, the “Lender Creditors”), have entered into a Credit
Agreement, dated as of March 17, 2004, providing for the making of Loans to the
Borrower and the issuance of, and participation in, Letters of Credit for the
account of the Borrower as contemplated therein (as used herein, the term “Credit
Agreement” means the Credit Agreement described above in this paragraph as
amended, restated, modified, extended, renewed, replaced, supplemented,
restructured and/or refinanced from time to time);

 

WHEREAS, the Borrower and/or one or more of its Subsidiaries may at any
time and from time to time (i) enter into one or more Interest Rate Protection
Agreements or Other Hedging Agreements with one or more Lenders or any
affiliate thereof, (ii) enter into one or more Commodities Agreements with one
or more Lenders or any affiliate thereof or (iii) maintain Existing Interest
Rate Protection Agreements with any financial institution (each such Lender,
affiliate or other financial institution, even if the respective Lender
subsequently ceases to be a Lender under the Credit Agreement for any reason,
together with such Lender’s, affiliate’s or other financial institution’s
successors and assigns, if any, collectively, the “Other Creditors” and
together with the Lender Creditors are herein called, the “Secured Creditors”);

 

WHEREAS, pursuant to the Credit Agreement Party Guaranty, each of
Holdings and the Borrower have unconditionally guaranteed to the Secured
Creditors the payment when due of all Relevant Guaranteed Obligations as
described therein;

 

WHEREAS, pursuant to the Subsidiaries Guaranty, each Subsidiary
Guarantor has jointly and severally guaranteed to the Secured Creditors the
payment when due of all Guaranteed Obligations as described therein;

 

 

WHEREAS, it is a condition precedent to the making of Loans to the
Borrower and the issuance of, and participation in, Letters of Credit for the
account of the Borrower under the Credit Agreement, and to the Other Creditors
entering into and/or maintaining Secured Hedging Agreements, that each Assignor
shall have executed and delivered to the First-Lien Collateral Agent this
Agreement; and

 

WHEREAS, each Assignor will obtain benefits from the incurrence of
Loans by, and the issuance of Letters of Credit for the account of, the
Borrower under the Credit Agreement and the entering into and/or maintaining of
Secured Hedging Agreements and, accordingly, each Assignor desires to execute
this Agreement to satisfy the condition precedent described in the preceding
paragraph;

 

NOW, THEREFORE, in consideration of the benefits accruing to each
Assignor, the receipt and sufficiency of which are hereby acknowledged, each
Assignor hereby makes the following representations and warranties to the
First-Lien Collateral Agent and hereby covenants and agrees with the First-Lien
Collateral Agent as follows:

 

ARTICLE
I

SECURITY INTERESTS

 

1.1.  Grant of Security Interests.  (a) 
As security for the prompt and complete payment and performance when due
of all of the Obligations, each Assignor does hereby assign and transfer unto
the First-Lien Collateral Agent, and does hereby pledge and grant to the
First-Lien Collateral Agent for the benefit of the Secured Creditors, a
continuing security interest in, all of the right, title and interest of such
Assignor in, to and under all of the following, whether now existing or
hereafter from time to time acquired:

 

(i)            each and every Receivable;

 

(ii)           all cash;

 

(iii)          the Cash Collateral Account and all
monies, securities, Instruments and other investments deposited or required to
be deposited in the Cash Collateral Account;

 

(iv)          all Chattel Paper (including, without
limitation, all Tangible Chattel Paper and all Electronic Chattel Paper);

 

(v)           all Commercial Tort Claims;

 

(vi)          all computer programs of such Assignor
and all intellectual property rights therein and all other proprietary
information of such Assignor, including but not limited to Domain Names and
Trade Secret Rights;

 

(vii)         Contracts, together with all Contract
Rights arising thereunder;

 

 

 

(viii)        all Copyrights;

 

(ix)           all Equipment;

 

(x)            all Deposit Accounts and all other
demand, deposit, time, savings, cash management, passbook and similar accounts
maintained by such Assignor with any Person and all monies, securities,
Instruments and other investments deposited or required to be deposited in any
of the foregoing;

 

(xi)           all Documents;

 

(xii)          all General Intangibles;

 

(xiii)         all Goods;

 

(xiv)        all Instruments;

 

(xv)         all Inventory;

 

(xvi)        all Investment Property;

 

(xvii)       all Letter-of-Credit Rights (whether or
not the respective letter of credit is evidenced by a writing);

 

(xviii)      all Marks, together with the registrations
and right to all renewals thereof, and the goodwill of the business of such
Assignor symbolized by the Marks;

 

(xix)         all Patents;

 

(xx)          all Permits;

 

(xxi)         all Software and all Software licensing
rights, all writings, plans, specifications and schematics, all engineering
drawings, customer lists, goodwill and licenses, and all recorded data of any
kind or nature, regardless of the medium of recording;

 

(xxii)        all Supporting Obligations; and

 

(xxiii)       all Proceeds and products of any and all
of the foregoing (all of the above, the “Collateral”). 

 

(b)   The security interest of
the First-Lien Collateral Agent under this Agreement extends to all Collateral
of the kind which is the subject of this Agreement which any Assignor may
acquire at any time during the continuation of this Agreement.  Notwithstanding anything to the contrary
contained herein, the Collateral shall at no time include any items which would
at such time constitute Excluded Collateral.

 

(c)   Notwithstanding anything
herein to the contrary, the relative rights and remedies of First-Lien
Collateral Agent shall be subject to and governed by the terms of the

 

 

Intercreditor Agreement at any
time the Intercreditor Agreement is in effect. 
In the event of any inconsistency between the terms hereof and the
Intercreditor Agreement, the Intercreditor Agreement shall control at any time
the Intercreditor Agreement is in effect.

 

1.2.  Power of Attorney.  Each Assignor hereby constitutes and appoints the First-Lien
Collateral Agent its true and lawful attorney, irrevocably, with full power
after the occurrence of and during the continuance of an Event of Default (in
the name of such Assignor or otherwise) to act, require, demand, receive,
compound and give acquittance for any and all monies and claims for monies due
or to become due to such Assignor under or arising out of the Collateral, to
endorse any checks or other instruments or orders in connection therewith and
to file any claims or take any action or institute any proceedings which the
First-Lien Collateral Agent may deem to be necessary or advisable to accomplish
the purposes of this Agreement, which appointment as attorney is coupled with
an interest.

 

ARTICLE
II

GENERAL REPRESENTATIONS, WARRANTIES AND COVENANTS

 

Each Assignor represents, warrants and covenants, which
representations, warranties and covenants shall survive execution and delivery
of this Agreement, as follows:

 

2.1.  Necessary Filings.  (i)  All filings, registrations and recordings
necessary or appropriate to create, preserve, protect and perfect the security
interest granted by such Assignor to the First-Lien Collateral Agent for the
benefit of the Secured Creditors hereby in respect of the Collateral have been
accomplished (or, in the case of Collateral for which it is necessary to file a
UCC-1 financing statement or make a filing with the United States Trademark and
Patent Office or United States Copyright Office in order to perfect a security
interest in such Collateral, such filings will be accomplished within 10 days
following the Initial Borrowing Date (or to the extent such Collateral is
acquired after the Initial Borrowing Date, within 10 days following the date of
the acquisition of such Collateral)), and (ii) the security interest granted to
the First-Lien Collateral Agent pursuant to this Agreement in and to the
Collateral constitutes (or, in the case of Collateral referred to in the
parenthetical in clause (i) above, upon compliance with the requirements of
such parenthetical, will constitute) a perfected security interest therein
prior to the rights of all other Persons therein (except as otherwise permitted
by the Credit Documents (including Section 3.9 of this Agreement with respect
to Deposit Accounts)) and subject to no other Liens (other than Permitted
Liens) and is entitled to all the rights, priorities and benefits afforded by
the Uniform Commercial Code or other relevant law as enacted in any relevant
jurisdiction to perfected security interests.

 

2.2.  No Liens.  Such
Assignor is, and as to all Collateral acquired by it from time to time after
the date hereof such Assignor will be, the owner of all Collateral free from
any Lien, security interest, encumbrance or other right, title or interest of
any Person (other than Permitted Liens and Liens created under this Agreement)
and such Assignor shall defend the Collateral against all claims and demands of
all Persons at any time claiming the same or any interest therein adverse to
the First-Lien Collateral Agent.

 

 

2.3.  Other Financing Statements.  As of the date hereof, there is no financing
statement evidencing a valid security interest against Holdings or any of its
Subsidiaries (or similar statement or instrument of registration under the law
of any jurisdiction) covering or purporting to cover any interest of any kind
in the Collateral (other than (x) those created under this Agreement, (y) as
may be filed in connection with Permitted Liens and (z) those with respect to
which appropriate termination statements executed by the secured lender
thereunder have been delivered to the Administrative Agent pursuant to the
terms of the Credit Agreement), and so long as the Total Commitment has not
been terminated or any Note or Letter of Credit remains outstanding or any of
the Obligations (other than arising from indemnities for which no request has
been made) remain unpaid or any Secured Hedging Agreement remains in effect or
any Obligations are owed with respect thereto, such Assignor will not execute
or authorize to be filed in any public office any financing statement (or
similar statement or instrument of registration under the law of any
jurisdiction) relating to the Collateral, except financing statements filed or
to be filed in respect of and covering the security interests granted hereby by
such Assignor or as permitted by the Credit Agreement.

 

2.4.  Chief Executive Office; Records.  The chief executive office of such Assignor
is located at the address or addresses indicated on Annex A hereto.  During the period of the four calendar
months preceding the date of this Agreement, the chief executive office of such
Assignor has not been located at any address other than that indicated on Annex
A in accordance with the immediately preceding sentence, in each case unless
each such other address is also indicated on Annex A hereto for such Assignor.

 

2.5.  Location of Inventory and Equipment.  All Inventory and Equipment held on the date
hereof by such Assignor is located at one of the locations shown on Annex B
hereto.

 

2.6.  Recourse.  This
Agreement is made with full recourse to each Assignor and pursuant to and upon
all the warranties, representations, covenants and agreements on the part of
such Assignor contained herein, in the other Credit Documents, in the Secured
Hedging Agreements and otherwise in writing in connection herewith or
therewith.

 

2.7.  Legal Names; Type of Organization (and Whether a
Registered Organization and/or a Transmitting Utility); Jurisdiction of
Organization; Location; Organizational Identification Numbers; Changes Thereto;
etc.  The exact legal name of each
Assignor, the type of organization of such Assignor, whether or not such
Assignor is a Registered Organization, the jurisdiction of organization of such
Assignor, such Assignor’s Location, the organizational identification number
(if any) of such Assignor, and whether or not such Assignor is a Transmitting
Utility, is listed on Annex C hereto for such Assignor.  Such Assignor shall not change its legal
name, its type of organization, its status as a Registered Organization (in the
case of a Registered Organization), its status as a Transmitting Utility or as
a Person which is not a Transmitting Utility, as the case may be, its jurisdiction
of organization, its Location, or its organizational identification number (if
any) from that used on Annex C hereto, except that any such changes shall be
permitted (so long as not in violation of the applicable requirements of the
Credit Agreement and so long as same do not involve (x) a Registered
Organization ceasing to constitute same or (y) such Assignor changing its
jurisdiction of organization or Location from the United States or a State
thereof to a jurisdiction of organization or Location, as the case may be,
outside the United States or a State thereof) if (i) it shall have given to the
First-Lien

 

 

Collateral Agent not less than
15 days’ prior written notice of each change to the information listed on Annex
C (as adjusted for any subsequent changes thereto previously made in accordance
with this sentence), together with a supplement to Annex C which shall correct
all information contained therein for such Assignor, and (ii) in connection
with the respective such change or changes, it shall have taken all action
reasonably requested by the First-Lien Collateral Agent to maintain the
security interests of the First-Lien Collateral Agent in the Collateral
intended to be granted hereby at all times fully perfected and in full force
and effect.  In addition, to the extent
that such Assignor does not have an organizational identification number on the
date hereof and later obtains one, such Assignor shall promptly thereafter
notify the First-Lien Collateral Agent of such organizational identification
number and shall take all actions reasonably satisfactory to the First-Lien
Collateral Agent to the extent necessary to maintain the security interest of
the First-Lien Collateral Agent in the Collateral intended to be granted hereby
fully perfected and in full force and effect.

 

2.8.  Trade Names; Etc.  Such Assignor has or operates in any jurisdiction under, or in
the preceding five years has had or has operated in any jurisdiction under, no
trade names, fictitious names or other names except its legal name as specified
in Annex C and such other trade or fictitious names as are listed on Annex D
hereto for such Assignor.  Such Assignor
shall not assume or operate in any jurisdiction under any new trade, fictitious
or other name until (i) it shall have given to the First-Lien Collateral Agent
not less than 30 days’ written notice of its intention so to do, clearly
describing such new name and the jurisdictions in which such new name will be
used and providing such other information in connection therewith as the
First-Lien Collateral Agent may reasonably request and (ii) with respect to
such new name, it shall have taken all action reasonably requested by the
First-Lien Collateral Agent to maintain the security interest of the First-Lien
Collateral Agent in the Collateral intended to be granted hereby at all times
fully perfected and in full force and effect.

 

2.9.  Certain Significant Transactions.  During the one year period preceding the
date of this Agreement, no Person shall have merged or consolidated with or
into any Assignor, and no Person shall have liquidated into, or transferred all
or substantially all of its assets to, any Assignor, in each case except as
described in Annex E hereto.  With
respect to any transactions so described in Annex E hereto, the respective
Assignor shall have furnished such information with respect to the Person (and
the assets of the Person and locations thereof) which merged with or into or
consolidated with such Assignor, or was liquidated into or transferred all or
substantially all of its assets to such Assignor, and shall have furnished to
the First-Lien Collateral Agent such UCC lien searches as may have been
requested with respect to such Person and its assets, to establish that no
security interest (excluding Permitted Liens) continues perfected on the date
hereof with respect to any Person described above (or the assets transferred to
the respective Assignor by such Person), including without limitation pursuant
to Section 9-316(a)(3) of the UCC.

 

2.10.  Non-UCC Property.  The aggregate fair market value (as determined by the Assignors
in good faith) of all property of the Assignors of the type described in clause
(1) of Section 9-311(a) of the UCC does not exceed $5,000,000.  If the aggregate value of all such property
at any time owned by all Assignors exceeds $5,000,000, the Assignors shall
provide prompt written notice thereof to the First-Lien Collateral Agent and,
upon the request of the First-Lien Collateral Agent, the Assignors shall
promptly (and in any event within 30 days) take

 

 

such actions (at their own cost
and expense) as may be required under the respective United States or other
laws, regulations or treaties referenced in Section 9-311(a)(1) of the UCC to
perfect the security interests granted herein in any Collateral where the
filing of a financing statement does not perfect the security interest in such
property in accordance with the provisions of Section 9-311(a)(1) of the UCC.

 

2.11.  As-Extracted Collateral;
Timber-to-be-Cut.  On the date
hereof, such Assignor does not own, or expect to acquire, any property which
constitutes, or would constitute, As-Extracted Collateral or
Timber-to-be-Cut.  If at any time after
the date of this Agreement such Assignor owns, acquires or obtains rights to
any As-Extracted Collateral or Timber-to-be-Cut, such Assignor shall furnish
the First-Lien Collateral Agent with prompt written notice thereof (which
notice shall describe in reasonable detail the As-Extracted Collateral and/or
Timber-to-be-Cut and the locations thereof) and shall take all actions as may
be deemed reasonably necessary or desirable by the First-Lien Collateral Agent
to perfect the security interest of the First-Lien Collateral Agent therein.

 

2.12.  Collateral in the Possession of a
Bailee.  If any Inventory or other
Goods are at any time in the possession of a bailee, such Assignor shall
promptly notify the First-Lien Collateral Agent thereof and, if requested by
the First-Lien Collateral Agent, shall use its commercially reasonable efforts
to promptly obtain an acknowledgment from such bailee, in form and substance
reasonably satisfactory to the First-Lien Collateral Agent, that the bailee
holds such Collateral for the benefit of the First-Lien Collateral Agent and
shall act upon the instructions of the First-Lien Collateral Agent, without the
further consent of such Assignor. The First-Lien Collateral Agent agrees with
such Assignor that the First-Lien Collateral Agent shall not give any such
instructions unless an Event of Default has occurred and is continuing or would
occur after taking into account any action by the respective Assignor with
respect to any such bailee.

 

ARTICLE
III

SPECIAL PROVISIONS CONCERNING

RECEIVABLES; CONTRACT RIGHTS; INSTRUMENTS

 

3.1.  Additional Representations and
Warranties.  As of the time when
each of its material Receivables arises, each Assignor shall be deemed to have
represented and warranted that such Receivable, and all records, papers and
documents relating thereto (if any) are genuine and accurate in all material
respects, and that all papers and documents (if any) relating thereto
(i) will represent in all material respects the genuine legal, valid and
binding (except to the extent that the enforceability thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
generally affecting creditors’ rights and by equitable principles, regardless
of whether enforcement is sought in equity or law) obligation of the account
debtor evidencing indebtedness unpaid and owed by the respective account debtor
arising out of the performance of labor or services or the sale or lease and
delivery of the inventory, materials, equipment or merchandise listed therein,
or both, (ii) will be the only original writings evidencing and embodying
such obligation of the account debtor named therein (other than copies created
for general accounting purposes), (iii) will evidence true, legal and

 

 

valid obligations, enforceable
in accordance with their respective terms (except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws generally affecting creditors’
rights and by equitable principles (regardless of whether enforcement is sought
in equity or law)) and (iv) will be in compliance and will conform in all
material respects with all applicable federal, state and local laws and
applicable laws of any relevant foreign jurisdiction.

 

3.2.  Maintenance of Records.  Each Assignor will keep and maintain at its
own cost and expense satisfactory and complete records of its Receivables and
Contracts, including, but not limited to, originals or copies of all
documentation (including each Contract), if any, with respect thereto, records
of all payments received, all credits granted thereon, all merchandise returned
and all other dealings therewith, and such Assignor will make the same
available on such Assignor’s premises to the First-Lien Collateral Agent for
inspection, at such Assignor’s own cost and expense, at any and all reasonable
times and intervals as the First-Lien Collateral Agent may request, but no more
than two times in any calendar year unless an Event of Default has occurred and
is continuing.  Upon the occurrence and
during the continuance of an Event of Default and at the request of the
First-Lien Collateral Agent, such Assignor shall, at its own cost and expense,
deliver all tangible evidence of its Receivables and Contract Rights
(including, without limitation, all documents, if any,  evidencing the Receivables and all
Contracts) and such books and records to the First-Lien Collateral Agent or to
its representatives (copies of which evidence and books and records may be
retained by such Assignor).  If the
First-Lien Collateral Agent so directs, such Assignor shall legend, in form and
manner satisfactory to the First-Lien Collateral Agent, the Receivables and the
Contracts, as well as books, records and documents of such Assignor evidencing
or pertaining to such Receivables and Contracts with an appropriate reference
to the fact that such Receivables and Contracts have been assigned to the
First-Lien Collateral Agent and that the First-Lien Collateral Agent has a
security interest therein.

 

3.3.  Direction to Account Debtors;
Contracting Parties; etc.  Upon
the occurrence and during the continuance of an Event of Default, and if the
First-Lien Collateral Agent so directs any Assignor, such Assignor agrees (x)
to cause all payments on account of the Receivables and Contracts to be made
directly to the Cash Collateral Account, (y) that the First-Lien Collateral
Agent may, at its option, directly notify the obligors with respect to any
Receivables and/or under any Contracts to make payments with respect thereto as
provided in preceding clause (x), and (z) that the First-Lien Collateral Agent
may enforce collection of any such Receivables or Contracts and may adjust,
settle or compromise the amount of payment thereof, in the same manner and to
the same extent as such Assignor.  Upon
the occurrence and during the continuance of an Event of Default, without
notice to or assent by any Assignor, the First-Lien Collateral Agent may apply
any or all amounts then in, or thereafter deposited in, the Cash Collateral
Account in the manner provided in Section 7.4 of this Agreement.  The costs and expenses (including attorneys’
fees) of collection, whether incurred by any Assignor or the First-Lien
Collateral Agent, shall be borne by such Assignor.

 

3.4.  Modification of Terms; etc.  Except in accordance with such Assignor’s
ordinary course of business and consistent with reasonable business judgment
(and, in the case of any Accounts Receivable Facility Assets, except in
accordance with the provisions of the Accounts Receivable Facility Documents),
no Assignor shall rescind or cancel any indebtedness evidenced by any
Receivable or under any Contract, or modify any term thereof or make any

 

 

adjustment with respect
thereto, or extend or renew the same, or compromise or settle any material
dispute, claim, suit or legal proceeding relating thereto, or sell any
Receivable or Contract, or interest therein, without the prior written consent
of the First-Lien Collateral Agent.  No
Assignor will do anything to impair the rights of the First-Lien Collateral
Agent in the Receivables or Contracts, it being understood that nothing herein
shall prevent any Assignor from entering into or performing its obligations
under the Accounts Receivable Facility Documents.

 

3.5.  Collection. 
Each Assignor shall use reasonable efforts to endeavor to cause to be
collected from the account debtor named in each of its Receivables or obligor
under any Contract, as and when due (including, without limitation, amounts,
services or products which are delinquent, such amounts, services or products to
be collected in accordance with generally accepted lawful collection
procedures) any and all amounts, services or products owing under or on account
of such Receivable or Contract, and apply forthwith upon receipt thereof
all such amounts, services or products as are so collected to the outstanding
balance of such Receivable or under such Contract, except that, prior to the
occurrence of an Event of Default, any Assignor may allow in the ordinary
course of business as adjustments to amounts, services or products owing under
its Receivables and Contracts (i) an extension or renewal of the time or
times of payment or exchange, or settlement for less than the total unpaid
balance, which such Assignor finds appropriate in accordance with reasonable
business judgment and (ii) a refund or credit due as a result of returned
or damaged merchandise or improperly performed services.  The costs and expenses (including, without
limitation, attorneys’ fees) of collection, whether incurred by an Assignor or
the First-Lien Collateral Agent, shall be borne by the relevant Assignor.

 

3.6.  Instruments. 
If any Assignor owns or acquires any Instrument constituting Collateral
and having a face amount in excess of $500,000, such Assignor will within 10
days notify the First-Lien Collateral Agent thereof, and upon request by the
First-Lien Collateral Agent, will promptly deliver such Instrument (to the
extent such Instrument is not otherwise required to be delivered to the
First-Lien Collateral Agent pursuant to the Pledge Agreement) to the First-Lien
Collateral Agent appropriately endorsed to the order of the First-Lien
Collateral Agent as further security hereunder; provided, however,
that the aggregate amount of all Instruments and Tangible Chattel Paper not
delivered to the First-Lien Collateral Agent pursuant to this Section 3.6 and
Section 3.12 hereof shall not exceed $2,500,000 at any time.

 

3.7.  Further Actions.  Each Assignor will, at its own expense, make, execute, endorse,
acknowledge, file and/or deliver to the First-Lien Collateral Agent from time
to time such vouchers, invoices, schedules, confirmatory assignments,
conveyances, financing statements, transfer endorsements, powers of attorney,
certificates, reports and other assurances or instruments and take such further
steps relating to its Receivables, Contracts, Instruments and other property or
rights covered by the security interest hereby granted, as the First-Lien
Collateral Agent may reasonably request to preserve and protect its security
interest in the Collateral.

 

3.8.  Assignors Remain Liable Under
Contracts.  Anything herein to
the contrary notwithstanding, the Assignors shall remain liable under each of
the Contracts to observe and perform all of the conditions and obligations to
be observed and performed by them thereunder, all in accordance with and
pursuant to the terms and provisions of each Contract.  Neither the

 

 

First-Lien Collateral Agent nor
any other Secured Creditor shall have any obligation or liability under any
Contract by reason of or arising out of this Agreement or the receipt by the
First-Lien Collateral Agent or any other Secured Creditor of any payment
relating to such Contract pursuant hereto, nor shall the First-Lien Collateral
Agent or any other Secured Creditor be obligated in any manner to perform any
of the obligations of any Assignor under or pursuant to any Contract, to make
any payment, to make any inquiry as to the nature or the sufficiency of any
performance by any party under any Contract, to present or file any claim, to take
any action to enforce any performance or to collect the payment of any amounts
which may have been assigned to them or to which they may be entitled at any
time or times.

 

3.9.  Deposit Accounts; Etc.  (a) 
No Assignor maintains, or at any time after the date of this Agreement
shall establish or maintain, any demand, time, savings, passbook or similar
account, except for such accounts maintained with a bank (as defined in Section
9-102 of the UCC) whose jurisdiction (determined in accordance with Section
9-304 of the UCC) is within a State of the United States.  Annex F
hereto accurately sets forth, as of the date of this Agreement, for each
Assignor, each Deposit Account maintained by such Assignor (including a
description thereof and the respective account number), the name of the
respective bank with which such Deposit Account is maintained, and the
jurisdiction of the respective bank with respect to such Deposit Account.  For each Subject Deposit Account, the respective
Assignor shall cause the bank with which such Subject Deposit Account is
maintained to execute and deliver to the First-Lien Collateral Agent, within 60
days after the date of this Agreement, a “control agreement” in the form of
Annex G hereto (appropriately completed), with such changes thereto as may be
reasonably acceptable to the First-Lien Collateral Agent.  If any bank with which a Subject Deposit
Account is maintained refuses to, or does not, enter into such a “control
agreement”, then the respective Assignor shall promptly (and in any event
within 60 days after the date of this Agreement) close the respective Subject
Deposit Account and transfer all balances therein to (x) the Cash Collateral
Account, (y) another Subject Deposit Account subject to a “control agreement”
and meeting the requirements of this Section 3.9(a) or (z) another Deposit
Account subject to a “control agreement” and meeting the requirements of this
Section 3.9(a) as if such Deposit Account were a Subject Deposit Account (each
such Deposit Account referred to in this clause (z), an “Alternate Perfected
Deposit Account”).  If any bank with
which a Subject Deposit Account is maintained refuses to subordinate all its
claims with respect to such Subject Deposit Account to the First-Lien
Collateral Agent’s security interest therein on terms reasonably satisfactory
to the First-Lien Collateral Agent, then the First-Lien Collateral Agent, at
its option, may (x) require that such Subject Deposit Account be terminated in
accordance with the immediately preceding sentence or (y) agree to a “control
agreement” without such subordination, provided that in such event the
First-Lien Collateral Agent may at any time, at its option, subsequently
require that such Subject Deposit Account be terminated (within 30 days after
notice from the First-Lien Collateral Agent) in accordance with the
requirements of the immediately preceding sentence.  If any Assignor intends to close a Subject Deposit Account in
accordance with the terms of the respective “control agreement” for such
Subject Deposit Account, then the respective Assignor shall, immediately prior
to closing such Subject Deposit Account, transfer all balances therein to the
Cash Collateral Account, another Subject Deposit Account or an Alternate
Perfected Deposit Account.

 

(b)           After the date of
this Agreement, no Assignor shall establish any new demand, time, savings,
passbook or similar account, except for Deposit Accounts established and

 

 

maintained with banks and
meeting the requirements of the first sentence of preceding clause (a).  At the time any such Deposit Account is
established, the respective Assignor shall furnish to the First-Lien Collateral
Agent a supplement to Annex F hereto containing the relevant information with
respect to the respective Deposit Account and the bank with which same is
established.

 

(c)           Each Assignor
covenants and agrees to transfer, by the close of business on each Business Day
(in the city where the respective Deposit Account is maintained), any and all
cash and other funds on deposit in each Deposit Account of such Assignor to a
Subject Deposit Account or an Alternate Perfected Deposit Account, provided
that, in the case of a Deposit Account that is an Excluded Local Deposit
Account, all Cash and other funds on deposit in such Excluded Local Deposit
Account in excess of $50,000 shall be transferred, by the close of business on
the Business Day (in the city where the respective Excluded Local Deposit
Account is maintained) following the date of initial deposit of such cash and
other funds in such Excluded Local Deposit Account, to a Subject Deposit
Account or an Alternate Perfected Deposit Account.

 

3.10.  Letter-of-Credit
Rights.  If any Assignor is at
any time a beneficiary under a letter of credit with a stated amount of
$1,000,000 or more, such Assignor shall promptly notify the First-Lien
Collateral Agent thereof and, at the request of the First-Lien Collateral
Agent, such Assignor shall, pursuant to an agreement in form and substance
reasonably satisfactory to the First-Lien Collateral Agent, use its
commercially reasonable efforts to (i) arrange for the issuer and any confirmer
of such letter of credit to consent to an assignment to the First-Lien
Collateral Agent of the proceeds of any drawing under such letter of credit or
(ii) arrange for the First-Lien Collateral Agent to become the transferee
beneficiary of such letter of credit, with the First-Lien Collateral Agent
agreeing, in each case, that the proceeds of any drawing under the letter of
credit are to be applied as provided in this Agreement after the occurrence and
during the continuance of an Event of Default.

 

3.11.  Commercial
Tort Claims.  All Commercial
Tort Claims of each Assignor in existence on the date of this Agreement are
described in Annex H hereto.  If any
Assignor shall at any time after the date of this Agreement acquire a
Commercial Tort Claim in an amount (taking the greater of the aggregate claimed
damages thereunder or the reasonably estimated value thereof) of $1,000,000 or
more, such Assignor shall promptly notify the First-Lien Collateral Agent
thereof in a writing signed by such Assignor and describing the details thereof
and shall grant to the First-Lien Collateral Agent in such writing a security
interest therein and in the proceeds thereof, all upon the terms of this
Agreement, with such writing to be in form and substance reasonably
satisfactory to the First-Lien Collateral Agent.

 

3.12.  Chattel Paper.  Upon the request of the First-Lien
Collateral Agent made at any time or from time to time, each Assignor shall
promptly furnish to the First-Lien Collateral Agent a list of all Electronic
Chattel Paper held or owned by such Assignor. 
Furthermore, if requested by the First-Lien Collateral Agent, each
Assignor shall promptly take all actions which are reasonably practicable so
that the First-Lien Collateral Agent has “control” of all Electronic Chattel
Paper in accordance with the requirements of Section 9-105 of the UCC.  Each Assignor will promptly (and in any
event within 10 days) following any request by the First-Lien Collateral Agent,
deliver all of its Tangible Chattel Paper with a value of $1,000,000 or more to
the First-Lien Collateral Agent; provided, however, that the
aggregate amount of all Tangible

 

 

Chattel Paper and Instruments
not delivered to the First-Lien Collateral Agent pursuant to this Section 3.12
or Section 3.6 hereof shall not exceed $2,500,000 at any time.

 

3.13.  Further Actions.  Each Assignor will, at its own expense, make, execute, endorse,
acknowledge, file and/or deliver to the First-Lien Collateral Agent from time
to time such vouchers, invoices, schedules, confirmatory assignments,
conveyances, financing statements, transfer endorsements, certificates, reports
and other assurances or instruments and take such further steps, including any
and all actions as may be necessary or required under the Federal Assignment of
Claims Act, relating to its Receivables, Contracts, Instruments and other
property or rights covered by the security interest hereby granted, as the
First-Lien Collateral Agent may reasonably require.

 

ARTICLE
IV

SPECIAL PROVISIONS CONCERNING TRADEMARKS

AND DOMAIN NAMES

 

4.1.  Additional Representations and
Warranties.  Each Assignor
represents and warrants that it is the true, lawful, sole and exclusive owner
of or otherwise has the right to use the Marks and Domain Names listed in Annex
I hereto and that said listed Marks and Domain Names (i) constitute all the
Marks and Domain Names that such Assignor presently owns or uses in connection
with its business and (ii) include all Marks and applications for Marks
registered in the United States Patent and Trademark Office (or the equivalent
thereof in any foreign country), all material unregistered Marks that such
Assignor now owns, licenses or uses in connection with its business on the date
hereof and all Domain Names that such Assignor owns or uses in connection with
its business on the date hereof.  Each
Assignor further warrants that it has no knowledge, as of the date hereof, of
any material third party claim that any aspect of such Assignor’s present or
contemplated business operations infringes or will infringe any rights in any
trademark, service mark or trade name. 
Each Assignor represents and warrants that it is the beneficial and
record owner of all trademark registrations and applications listed in Annex I
hereto and designated as “owned” thereon and that said registrations are valid,
subsisting and have not been canceled and that such Assignor is not aware of
any material third party claim that any of said registrations is invalid or
unenforceable, or that there is any reason that any of said applications will
not pass to registration.  Each Assignor
represents and warrants that upon the recordation of an Assignment of Security
Interest in United States Trademarks and Patents in the form of Annex L hereto
in the United States Patent and Trademark Office, together with filings on Form
UCC-1 pursuant to this Agreement, all filings, registrations and recordings
necessary or appropriate to perfect the security interest granted to the
First-Lien Collateral Agent in the United States Marks covered by this
Agreement under federal law will have been accomplished.  Each Assignor agrees to execute such an
Assignment of Security Interest in United States Trademarks and Patents
covering all right, title and interest in each United States Mark, and the
associated goodwill, of such Assignor, and to record the same.  Each Assignor hereby grants to the
First-Lien Collateral Agent an absolute power of attorney to sign, upon the occurrence
and during the continuance of an Event of Default, any document which may be
required by the U.S. Patent and Trademark Office or secretary of state or
equivalent governmental agency of any

 

 

State of the United States or
any foreign jurisdiction in order to effect an absolute assignment of all
right, title and interest in each Mark and/or Domain Name, and record the same.

 

4.2.  Licenses and Assignments.  Each Assignor hereby agrees not to divest
itself of any right under any Mark or Domain Name absent prior written approval
of the First-Lien Collateral Agent (which approval shall not be unreasonably
withheld), except as otherwise permitted by this Agreement or the Credit
Agreement.

 

4.3.  Infringements. 
Each Assignor agrees, promptly upon learning thereof, to notify the
First-Lien Collateral Agent in writing of the name and address of, and to
furnish such pertinent information that may be available with respect to, (i)
any party who such Assignor believes is infringing or diluting or otherwise violating
in any material respect any of such Assignor’s rights in and to any Mark or
Domain Name, or (ii) with respect to any party claiming that such Assignor’s
use of any Mark or Domain Name violates in any material respect any property
right of that party.  Each Assignor
further agrees, unless otherwise agreed by the First-Lien Collateral Agent, to
prosecute, in accordance with reasonable business practices, any Person
infringing any Mark or Domain Name owned by such Assignor.

 

4.4.  Preservation of Marks.  Each Assignor agrees to use its Marks and
Domain Names in interstate or foreign commerce, as the case may be, during the
time in which this Agreement is in effect, sufficiently to preserve such Marks
as valid and subsisting trademarks or service marks under the laws of the
United States or the relevant foreign jurisdiction; provided that no
Assignor shall be obligated to preserve any Mark to the extent the Assignor
determines, in its reasonable business judgment, that the preservation of such
Mark is no longer economically desirable in the conduct of its business.

 

4.5.  Maintenance of Registration.  Each Assignor shall, at its own expense and
in accordance with reasonable business practices, process all documents
required to maintain Mark and Domain Name registrations, including but not
limited to affidavits of continued use and applications for renewals of
registration in the United States Patent and Trademark Office for all of its
registered Marks pursuant to 15 U.S.C. §§ 1058, 1059 and 1065 or any foreign
equivalent thereof, as applicable, and shall pay all fees and disbursements in
connection therewith and shall not abandon any such filing of affidavit of use
or any such application of renewal prior to the exhaustion of all
administrative and judicial remedies without prior written consent of the
First-Lien Collateral Agent; provided that no Assignor shall be
obligated to maintain any Mark and/or Domain Name to the extent such Assignor
determines, in its reasonable business judgment, that the maintenance of such
Mark and/or Domain Name is no longer economically desirable in the conduct of
its business.

 

4.6.  Future Registered Marks and Domain
Names.  If any registration for
any Mark issued hereafter to any Assignor as a result of any application now or
hereafter pending before the United States Patent and Trademark Office or any
Domain Name is registered by any Assignor, within 30 days of receipt of such
certificate, such Assignor shall deliver to the First-Lien Collateral Agent a
copy of such certificate, and an assignment for security in such Mark and/or
Domain Name, to the First-Lien Collateral Agent and at the expense of such
Assignor, confirming the assignment for security in such Mark and/or Domain
Name to the First-Lien Collateral Agent hereunder, the form of such assignment
for security to be substantially the same

 

 

as the form hereof or in such
other form as may be reasonably satisfactory to the First-Lien Collateral
Agent.

 

4.7.  Remedies.  If
an Event of Default shall occur and be continuing, the First-Lien Collateral
Agent may, by written notice to the relevant Assignor, take any or all of the
following actions:  (i) declare the
entire right, title and interest of such Assignor in and to each of the Marks
and Domain Names, together with all trademark rights and rights of protection
to the same and the goodwill of such Assignor’s business symbolized by said
Marks or Domain Names and the right to recover for past infringements thereof,
vested in the First-Lien Collateral Agent for the benefit of the Secured
Creditors, in which event such rights, title and interest shall immediately
vest, in the First-Lien Collateral Agent for the benefit of the Secured
Creditors, and the First-Lien Collateral Agent shall be entitled to exercise
the power of attorney referred to in Section 4.1 to execute, cause to be
acknowledged and notarized and to record an absolute assignment with the
applicable agency; (ii) take and use or sell the Marks or Domain Names and the
goodwill of such Assignor’s business symbolized by the Marks or Domain Names
and the right to carry on the business and use the assets of such Assignor in
connection with which the Marks or Domain Names have been used; and (iii)
direct such Assignor to refrain, in which event such Assignor shall refrain,
from using the Marks or Domain Names in any manner whatsoever, directly or
indirectly, and, if requested by the First-Lien Collateral Agent, change such
Assignor’s corporate name to eliminate therefrom any use of any Mark or Domain
Name and execute such other and further documents that the First-Lien
Collateral Agent may request to further confirm this and to transfer ownership
of the Marks or Domain Names and registrations and any pending trademark
applications therefor in the United States Patent and Trademark Office or any
equivalent government agency or office in any foreign jurisdiction to the
First-Lien Collateral Agent.

 

ARTICLE
V

SPECIAL PROVISIONS CONCERNING

PATENTS, COPYRIGHTS AND TRADE SECRETS

 

5.1.  Additional Representations and
Warranties.  Each Assignor
represents and warrants that it is the true and lawful exclusive owner of or
otherwise has the right to use all (i) Trade Secrets Rights and proprietary
information necessary to operate the business of such Assignor, (ii) rights in
the Patents of such Assignor listed in Annex J hereto and that said Patents
constitute all the patents and applications for patents that such Assignor now
owns or that are otherwise necessary in the conduct of the business of such
Assignor, and (iii) rights in the Copyrights of such Assignor listed in Annex K
hereto, and that such Copyrights constitute all registrations of copyrights and
applications for copyright registrations that such Assignor now owns or that
are otherwise necessary in the conduct of the business of such Assignor.  Each Assignor further represents and
warrants that it has the right to use and practice under all Patents and
Copyrights that it owns, uses or under which it practices and has the right to
exclude others from using or practicing under any Patents it owns.  Each Assignor further warrants that it has
no knowledge of any material third party claim that any aspect of such
Assignor’s present or contemplated business operations infringes or will infringe
any rights in any Patent or Copyright or that such Assignor has misappropriated
any Trade Secret, Trade Secret Rights or proprietary

 

 

information.  Each Assignor represents and warrants that
upon the recordation of an Assignment of Security Interest in United States
Trademarks and Patents in the form of Annex L hereto in the United States
Patent and Trademark Office and the recordation of an Assignment of Security
Interest in United States Copyrights in the form of Annex M hereto in the
United States Copyright Office, together with filings on Form UCC-1
pursuant to this Agreement, all filings, registrations and recordings necessary
or appropriate to perfect the security interest granted to the First-Lien
Collateral Agent in the United States Patents and United States Copyrights
covered by this Agreement under federal law will have been accomplished.  Upon obtaining any Patent, each Assignor
agrees to execute an Assignment of Security Interest in United States
Trademarks and Patents covering all right, title and interest in each United
States Patent of such Assignor and to record the same, and upon obtaining any
Copyright, to execute such an Assignment of Security Interest in United States
Copyrights covering all right, title and interest in each United States
Copyright of such Assignor and to record the same.  Each Assignor hereby grants to the First-Lien Collateral Agent an
absolute power of attorney to sign, upon the occurrence and during the
continuance of any Event of Default, any document which may be required by the
U.S. Patent and Trademark Office or equivalent governmental agency in any
foreign jurisdiction or the U.S. Copyright Office or equivalent governmental
agency in any foreign jurisdiction in order to effect an absolute assignment of
all right, title and interest in each Patent and Copyright of such Assignor, as
the case may be, and to record the same.

 

5.2.  Licenses and Assignments.  Each Assignor hereby agrees not to divest
itself of any right under any Patent or Copyright absent prior written approval
of the First-Lien Collateral Agent (which approval shall not be unreasonably
withheld), except as otherwise permitted by this Agreement or the Credit
Agreement.

 

5.3.  Infringements.  Each Assignor agrees, promptly upon learning thereof, to furnish
the First-Lien Collateral Agent in writing with all pertinent information
available to such Assignor with respect to any infringement, contributing
infringement or active inducement to infringe any of such Assignor’s rights in
any Patent or Copyright of such Assignor or to any claim that the practice of
any Patent or the use of any Copyright violates any property right of a third
party, or with respect to any misappropriation of any Trade Secret Right of
such Assignor or any claim that practice of any Trade Secret Right of such
Assignor violates any property right of a third party.  Each Assignor further agrees, absent
direction of the First-Lien Collateral Agent to the contrary, to prosecute, in
accordance with reasonable business practices, any Person infringing any Patent
or Copyright of such Assignor or any Person misappropriating any Trade Secret
Right of such Assignor.

 

5.4.  Maintenance of Patents and Copyrights.  At its own expense, each Assignor shall make
timely payment of all post-issuance fees required pursuant to applicable law to
maintain in force rights under each of its Patents, and to apply as permitted
pursuant to applicable law for any renewal of each of its Copyrights, in any
case absent prior written consent of the First-Lien Collateral Agent; provided,
that, no Assignor shall be obligated to pay any such fees or apply for any such
renewal to the extent that such Assignor determines, in its reasonable business
judgment, that the maintenance of such Patent or Copyright is no longer
economically desirable in the conduct of its business.

 

 

5.5.  Prosecution of Patent or Copyright
Applications.  At its own expense,
each Assignor shall prosecute, in accordance with reasonable business
practices, all of its applications for Patents listed in Annex J hereto
and for Copyrights listed in Annex K hereto and shall not abandon any such
application prior to exhaustion of all administrative and judicial remedies,
absent written consent of the First-Lien Collateral Agent.

 

5.6.  Other Patents and Copyrights.  Within 30 days of the acquisition or
issuance of a United States Patent or of a Copyright registration, or of filing
of an application for a United States Patent or Copyright registration, the
relevant Assignor shall deliver to the First-Lien Collateral Agent a copy of
said Patent or Copyright registration or certificate or registration of, or
application therefor, as the case may be, with an assignment for security as to
such Patent or Copyright, as the case may be, to the First-Lien Collateral
Agent and at the expense of such Assignor, confirming the assignment for
security, the form of such assignment for security to be substantially the same
as the form hereof or in such other form as may be reasonably satisfactory to
the First-Lien Collateral Agent.

 

5.7.  Remedies. 
If an Event of Default shall occur and be continuing, the First-Lien
Collateral Agent may by written notice to the relevant Assignor, take any or
all of the following actions:  (i)
declare the entire right, title, and interest of such Assignor in each of the
Patents and Copyrights vested in the First-Lien Collateral Agent for the
benefit of the Secured Creditors, in which event such right, title, and
interest shall immediately vest in the First-Lien Collateral Agent for the
benefit of the Secured Creditors, and the First-Lien Collateral Agent shall be
entitled to exercise the power of attorney referred to in Section 5.1 to
execute, cause to be acknowledged and notarized and to record an absolute
assignment with the applicable agency; (ii) take and use, practice or sell the
Patents, Copyrights and Trade Secret Rights; and (iii) direct such Assignor to
refrain, in which event such Assignor shall refrain, from practicing the
Patents and using the Copyrights and/or Trade Secret Rights directly or
indirectly, and such Assignor shall execute such other and further documents as
the First-Lien Collateral Agent may request further to confirm this and to
transfer ownership of the Patents, Copyrights and Trade Secret Rights to the
First-Lien Collateral Agent for the benefit of the Secured Creditors.

 

ARTICLE
VI

PROVISIONS CONCERNING ALL COLLATERAL

 

6.1.  Protection of First-Lien Collateral
Agent’s Security.  Each Assignor
will do nothing to impair the rights of the First-Lien Collateral Agent in the
Collateral.  Each Assignor will at all
times keep its Inventory and Equipment insured in favor of the First-Lien
Collateral Agent, at such Assignor’s own expense to the extent and in the
manner provided in the Credit Agreement and the other Credit Documents.  All policies or certificates with respect to
such material insurance (and any other material insurance maintained by such
Assignor) shall (i) be endorsed to the First-Lien Collateral Agent’s
satisfaction for the benefit of the First-Lien Collateral Agent (including,
without limitation, by naming the First-Lien Collateral Agent as loss payee and
naming each of the Lenders, the Administrative Agent and the First-Lien
Collateral Agent as additional insureds); (ii) state that such insurance
policies shall not be canceled or materially revised without 30 days’ prior
written notice thereof by the insurer to the First-Lien

 

 

Collateral Agent; and (iii) be
deposited (or certified copies of such policies or certificates shall be
deposited) with the First-Lien Collateral Agent to the extent, at the times and
in the manner specified in the Credit Agreement.  If any Assignor shall fail to insure its Inventory and Equipment
in accordance with the preceding sentence, or if any Assignor shall fail to so
endorse and deposit all policies or certificates with respect thereto, the
First-Lien Collateral Agent shall have the right (but shall be under no
obligation) to procure such insurance and such Assignor agrees to promptly
reimburse the First-Lien Collateral Agent for all costs and expenses of procuring
such insurance.  Except as otherwise
permitted to be retained or expended by the relevant Assignor pursuant to the
Credit Agreement, the First-Lien Collateral Agent shall, at the time such
proceeds of such insurance are distributed to the Secured Creditors, apply such
proceeds in accordance with the Credit Agreement, or after the Obligations have
been accelerated or otherwise become due and payable, in accordance with
Section 7.4.  Each Assignor assumes all
liability and responsibility in connection with the Collateral acquired by it
and the liability of such Assignor to pay the Obligations shall in no way be
affected or diminished by reason of the fact that such Collateral may be lost,
destroyed, stolen, damaged or for any reason whatsoever unavailable to such
Assignor.

 

6.2.  Warehouse Receipts Non-Negotiable.  Each Assignor agrees that if any warehouse
receipt or receipt in the nature of a warehouse receipt is issued with respect
to any of its Inventory, such warehouse receipt or receipt in the nature thereof
shall not be “negotiable” (as such term is used in Section 7-104 of the Uniform
Commercial Code as in effect in any relevant jurisdiction or under other
relevant law).

 

6.3.  Further Actions.  Each Assignor will, at its own expense, make, execute, endorse,
acknowledge, file and/or deliver to the First-Lien Collateral Agent from time
to time such lists, descriptions and designations of its Collateral, warehouse
receipts, receipts in the nature of warehouse receipts, bills of lading,
documents of title, vouchers, invoices, schedules, confirmatory assignments,
conveyances, financing statements, transfer endorsements, powers of attorney,
certificates, reports and other assurances or instruments and take such further
steps relating to the Collateral and other property or rights covered by the
security interest hereby granted, which the First-Lien Collateral Agent deems
reasonably appropriate or advisable to perfect, preserve or protect its
security interest in the Collateral.

 

6.4.  Financing Statements.  Each Assignor agrees to execute and deliver
to the First-Lien Collateral Agent such financing statements, in form
acceptable to the First-Lien Collateral Agent, as the First-Lien Collateral
Agent may from time to time reasonably request or as are reasonably necessary
or desirable in the opinion of the First-Lien Collateral Agent to establish and
maintain a valid, enforceable, first priority perfected security interest in
the Collateral as provided herein and the other rights and security
contemplated hereby all in accordance with the Uniform Commercial Code as
enacted in any and all relevant jurisdictions or any other relevant law.  Each Assignor will pay any applicable filing
fees, recordation taxes and related expenses relating to its Collateral.  Each Assignor hereby authorizes the
First-Lien Collateral Agent to file any such financing statements without the
signature of such Assignor where permitted by law (and such authorization
includes describing the Collateral as “all assets” of such Assignor).

 

 

6.5.  Additional Information.  Each Assignor will, at its own expense, from
time to time upon the reasonable request of the First-Lien Collateral Agent,
promptly (and in any event within 15 days after its receipt of the respective
request) furnish to the First-Lien Collateral Agent such information with
respect to the Collateral (including the identity of the Collateral or such
components thereof as may have been requested by the Agent, the value and
location of such Collateral, etc.) as may be requested by the First-Lien
Collateral Agent.  Without limiting the
forgoing, each Assignor agrees that it shall promptly (and in any event within
10 days after its receipt of the respective request) furnish to the First-Lien
Collateral Agent such updated Annexes hereto as may from time to time be
reasonably requested by the First-Lien Collateral Agent.

 

ARTICLE
VII

REMEDIES UPON OCCURRENCE OF EVENT OF DEFAULT

 

7.1.  Remedies; Obtaining the Collateral
Upon Default.  Each Assignor
agrees that, if any Event of Default shall have occurred and be continuing,
then and in every such case, the First-Lien Collateral Agent, in addition to
any rights now or hereafter existing under applicable law, shall have all
rights as a secured creditor under the Uniform Commercial Code, and such
additional rights and remedies to which a secured creditor is entitled under
the laws in effect, in all relevant jurisdictions and may also:

 

(i)          personally, or by agents or attorneys,
immediately take possession of the Collateral or any part thereof, from such
Assignor or any other Person who then has possession of any part thereof with
or without notice or process of law, and for that purpose may enter upon such
Assignor’s premises where any of the Collateral is located and remove the same
and use in connection with such removal any and all services, supplies, aids
and other facilities of such Assignor;

 

(ii)         instruct the obligor or obligors on any
agreement, instrument or other obligation (including, without limitation, the
Receivables and the Contracts) constituting the Collateral to make any payment
required by the terms of such agreement, instrument or other obligation
directly to the First-Lien Collateral Agent;

 

(iii)        instruct all banks which have entered
into a control agreement with the First-Lien Collateral Agent to transfer all
monies, securities and instruments held by such depositary bank to the Cash
Collateral Account and withdraw all monies, securities and instruments in the
Cash Collateral Account for application to the Obligations in accordance with
Section 7.4;

 

(iv)       sell, assign or otherwise liquidate, or
direct such Assignor to sell, assign or otherwise liquidate, any or all of the
Collateral or any part thereof in accordance with Section 7.2, or direct the
relevant Assignor to sell, assign or otherwise liquidate any or all of the
Collateral or any part thereof, and, in each case, take possession of the
proceeds of any such sale or liquidation;

 

 

(v)        take possession of the Collateral or any
part thereof, by directing the relevant Assignor in writing to deliver the same
to the First-Lien Collateral Agent at any place or places designated by the
First-Lien Collateral Agent, in which event such Assignor shall at its own
expense:

 

(x)  forthwith cause the same to be moved to the
place or places so designated by the First-Lien Collateral Agent and there
delivered to the First-Lien Collateral Agent;

 

(y)  store and keep any Collateral so delivered
to the First-Lien Collateral Agent at such place or places pending further
action by the First-Lien Collateral Agent as provided in Section 7.2; and

 

(z)  while the Collateral shall be so stored and
kept, provide such guards, other security and maintenance services as shall be
necessary to protect the same and to preserve and maintain them in good condition;
and

 

(vi)       license or sublicense, whether on an
exclusive or nonexclusive basis, any Marks, Domain Names, Patents or Copyrights
included in the Collateral for such term and on such conditions and in such
manner as the First-Lien Collateral Agent shall in its sole judgment determine;

 

(vii)      apply any monies constituting Collateral
or proceeds thereof in accordance with the provisions of Section 7.4; and

 

(viii)     take any other action as specified in
clauses (1) through (5), inclusive, of Section 9-607 of the UCC;

 

it being understood that each Assignor’s obligation so
to deliver the Collateral is of the essence of this Agreement and that,
accordingly, upon application to a court of equity having jurisdiction, the
First-Lien Collateral Agent shall be entitled to a decree requiring specific
performance by such Assignor of said obligation.  The Secured Creditors agree that this Agreement may be enforced
only by the action of the Administrative Agent or the First-Lien Collateral
Agent, in each case acting upon the instructions of the Required Lenders (or,
after the date on which all Credit Document Obligations have been paid in full,
the holders of at least the majority of the outstanding Other Obligations) and
that no other Secured Creditor shall have any right individually to seek to
enforce or to enforce this Agreement or to realize upon the security to be
granted hereby, it being understood and agreed that such rights and remedies
may be exercised by the Administrative Agent or the First-Lien Collateral Agent
or the holders of at least a majority of the outstanding Other Obligations, as
the case may be, for the benefit of the Secured Creditors upon the terms of
this Agreement and the Credit Agreement.

 

7.2.  Remedies; Disposition of the
Collateral.  Any Collateral
repossessed by the First-Lien Collateral Agent under or pursuant to Section 7.1
and any other Collateral whether or not so repossessed by the First-Lien
Collateral Agent, may be sold, assigned, leased or otherwise disposed of under
one or more contracts or as an entirety, and without the necessity of gathering
at the place of sale the property to be sold, and in general in such manner, at
such time or times, at such place or places and on such terms as the First-Lien
Collateral Agent may, in compliance

 

 

with any mandatory requirements
of applicable law, determine to be commercially reasonable.  Any of the Collateral may be sold, leased or
otherwise disposed of, in the condition in which the same existed when taken by
the First-Lien Collateral Agent or after any overhaul or repair at the expense
of the relevant Assignor which the First-Lien Collateral Agent shall determine
to be commercially reasonable. Any such disposition which shall be a private
sale or other private proceedings permitted by such requirements shall be made
upon not less than 10 days written notice to the relevant Assignor specifying
the time at which such disposition is to be made and the intended sale price or
other consideration therefor, and shall be subject, for the 10 days after the
giving of such notice, to the right of the relevant Assignor or any nominee of
such Assignor to acquire the Collateral involved at a price or for such other
consideration at least equal to the intended sale price or other consideration
so specified.  Any such disposition
which shall be a public sale permitted by such requirements shall be made upon
not less than 10 days’ written notice to the relevant Assignor specifying the
time and place of such sale and, in the absence of applicable requirements of
law, shall be by public auction (which may, at the First-Lien Collateral
Agent’s option, be subject to reserve), after publication of notice of such
auction not less than 10 days prior thereto in two newspapers in general
circulation to be selected by the First-Lien Collateral Agent.  To the extent permitted by any such
requirement of law, the First-Lien Collateral Agent on behalf of the Secured
Creditors (or certain of them) may bid for and become the purchaser of the
Collateral or any item thereof, offered for sale in accordance with this
Section without accountability to the relevant Assignor.  If, under mandatory requirements of
applicable law, the First-Lien Collateral Agent shall be required to make a
disposition of the Collateral within a period of time which does not permit the
giving of notice to the relevant Assignor as hereinabove specified, the
First-Lien Collateral Agent need give such Assignor only such notice of
disposition as shall be reasonably practicable in view of such mandatory requirements
of applicable law.  Each Assignor agrees
to do or cause to be done all such other acts and things as may be reasonably
necessary to make such sale or sales of all or any portion of the Collateral of
such Assignor valid and binding and in compliance with any and all applicable
laws, regulations, orders, writs, injunctions, decrees or awards of any and all
courts, arbitrations or governmental instrumentalities, domestic or foreign,
having jurisdiction over any such sale or sales, all at such Assignor’s
expense.

 

7.3.  Waiver of Claims.  Except as otherwise provided in this Agreement, EACH ASSIGNOR
HEREBY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE LAW, NOTICE AND JUDICIAL
HEARING IN CONNECTION WITH THE COLLATERAL AGENT’S TAKING POSSESSION OR THE COLLATERAL
AGENT’S DISPOSITION OF ANY OF THE COLLATERAL, INCLUDING, WITHOUT LIMITATION,
ANY AND ALL PRIOR NOTICE AND HEARING FOR ANY PREJUDGMENT REMEDY OR REMEDIES AND
ANY SUCH RIGHT WHICH SUCH ASSIGNOR WOULD OTHERWISE HAVE UNDER THE LAW OF THE
UNITED STATES OR OF ANY STATE, and such Assignor hereby further waives, to the
extent permitted by law:

 

(i)          all damages occasioned by such taking
of possession except any damages which are the direct result of the First-Lien
Collateral Agent’s gross negligence or willful misconduct;

 

 

(ii)         all other requirements as to the time,
place and terms of sale or other requirements with respect to the enforcement
of the First-Lien Collateral Agent’s rights hereunder; and

 

(iii)        all rights of redemption, appraisement,
valuation, stay, extension or moratorium now or hereafter in force under any
applicable law in order to prevent or delay the enforcement of this Agreement
or the absolute sale of the Collateral or any portion thereof, and each
Assignor, for itself and all who may claim under it, insofar as it or they now
or hereafter lawfully may, hereby waives the benefit of all such laws.

 

Any sale of, or the grant of options to purchase, or any other
realization upon, any Collateral shall operate to divest all right, title,
interest, claim and demand, either at law or in equity, of the relevant
Assignor therein and thereto, and shall be a perpetual bar both at law and in
equity against such Assignor and against any and all Persons claiming or
attempting to claim the Collateral so sold, optioned or realized upon, or any
part thereof, from, through and under such Assignor.

 

7.4.  Application of Proceeds.  (a) 
All moneys collected by the First-Lien Collateral Agent upon any sale or
other disposition of the Collateral (or, to the extent the Pledge Agreement or
any other Security Document requires proceeds of collateral thereunder to be
applied in accordance with the provisions of this Agreement, the Pledgee under
the Pledge Agreement or the collateral agent under such other Security Document),
together with all other moneys received by the First-Lien Collateral Agent
hereunder, shall be applied as follows:

 

(i)          first, to the payment of all
Obligations owing to the Pledgee or the First-Lien Collateral Agent of the type
described in clauses (iii), (iv) and (v) of the definition of “Obligations”;

 

(ii)         second, to the extent proceeds remain
after the application pursuant to the preceding clause (i), to the payment of
all amounts owing to any Agent of the type described in clauses (v) and (vi) of
the definition of “Obligations”;

 

(iii)        third, to the extent proceeds remain
after the application pursuant to the preceding clauses (i) and (ii), an amount
equal to the outstanding Primary Obligations shall be paid to the Secured
Creditors as provided in Section 7.4(e), with each Secured Creditor receiving
an amount equal to its outstanding Primary Obligations or, if the proceeds are
insufficient to pay in full all such Primary Obligations, its Pro  Rata
Share of the amount remaining to be distributed; provided  however
that Secured Creditors with Primary Obligations constituting Other Obligations
arising under, or in respect of, Commodities Agreements shall not be entitled
to receive more than $10,000,000 as a result of the application of the proceeds
of Collateral pursuant to this clause (iii), with any excess proceeds of
Collateral to be distributed after such threshold is reached to be applied to
all other Primary Obligations as otherwise required above (as if no further
Primary Obligations constituting Other Obligations arising under, or in respect
of, Commodities Agreements were then outstanding);

 

 

(iv)       fourth, to the extent proceeds remain
after the application pursuant to the preceding clauses (i), (ii) and (iii), an
amount equal to the outstanding Secondary Obligations shall be paid to the
Secured Creditors as provided in Section 7.4(e), with each Secured Creditor
receiving an amount equal to its outstanding Secondary Obligations or, if the
proceeds are insufficient to pay in full all such Secondary Obligations, its Pro
Rata Share of the amount remaining to be distributed; provided  however
that Secured Creditors with Secondary Obligations constituting Other
Obligations arising under, or in respect of, Commodities Agreements shall not
be entitled to receive more than $10,000,000 as a result of the application of
the proceeds of Collateral pursuant to preceding clause (iii) and this clause
(iv), with any excess proceeds of Collateral to be distributed after such
threshold is reached to be applied to all other Secondary Obligations as
otherwise required above (as if no further Secondary Obligations constituting
Other Obligations arising under, or in respect of, Commodities Agreements were
then outstanding);

 

(v)        fifth, to the extent proceeds remain after
the application pursuant to the preceding clauses (i), (ii), (iii) and (iv), an
amount equal to the outstanding Tertiary Obligations shall be paid to the
relevant Other Creditors as provided in Section 7.4(e), with each relevant
Other Creditor receiving an amount equal to its outstanding Tertiary
Obligations or, if the proceeds are insufficient to pay in full all such
Tertiary Obligations, its Pro  Rata Share of the amount remaining
to be distributed; and

 

(vi)       sixth, to the extent proceeds remain
after the application pursuant to the preceding clauses (i) through (v),
inclusive, and following the termination of this Agreement pursuant to Section
10.8(a) hereof, to the relevant Assignor or to whoever may be lawfully entitled
to receive such surplus.

 

(b)   For purposes of this
Agreement (w) “Pro  Rata Share” shall mean, when calculating a
Secured Creditor’s portion of any distribution or amount, that amount
(expressed as a percentage) equal to a fraction the numerator of which is the
then unpaid amount of such Secured Creditor’s Primary Obligations or Secondary
Obligations, as the case may be, and the denominator of which is the then
outstanding amount of all Primary Obligations or Secondary Obligations, as the
case may be, provided that in the circumstances contemplated by the
provisos in clauses 7.4(a)(iii) and (iv), Primary Obligations and Secondary
Obligations constituting Other Obligations arising under, or in respect of,
Commodities Agreements shall be excluded in determining the Primary Obligations
and Secondary Obligations as used in determining a given Secured Creditor’s “Pro
Rata Share” pursuant to this definition, (x) “Primary Obligations” shall
mean (i) in the case of the Credit Document Obligations, all principal of, and
interest on, all Loans under the Credit Agreement, all Unpaid Drawings
theretofore made (together with all interest accrued thereon), the aggregate
Stated Amounts of all Letters of Credit issued (or deemed issued) under the
Credit Agreement, and all Fees and (ii) in the case of the Other Obligations,
all amounts due under the Secured Hedging Agreements (other than indemnities,
fees (including, without limitation, attorneys’ fees) and similar obligations
and liabilities),  (y) “Secondary Obligations”
shall mean all Obligations other than Primary Obligations and Tertiary
Obligations and (z) “Tertiary Obligations” shall mean all Other Obligations (if
any) arising under, or in respect of, Commodities Agreements which remain
outstanding after giving effect to the application of Collateral proceeds
pursuant to Sections 7.4(a)(i), (ii), (iii) and (iv).

 

 

(c)   When payments to Secured
Creditors are based upon their respective Pro  Rata Shares, the
amounts received by such Secured Creditors hereunder shall, subject to the
proviso to the definition of “Pro  Rata Share”, be applied (for
purposes of making determinations under this Section 7.4 only) (i) first,
to their Primary Obligations, (ii) second, to their Secondary
Obligations and (ii) third, to their Tertiary Obligations.

 

(d)   Each of the Secured
Creditors agrees and acknowledges that if the Lender Creditors are to receive a
distribution on account of undrawn amounts with respect to Letters of Credit
issued (or deemed issued) under the Credit Agreement (which shall only occur
after all outstanding Loans and Unpaid Drawings with respect to such Letters of
Credit have been paid in full), such amounts shall be paid to the
Administrative Agent under the Credit Agreement and held by it, for the equal
and ratable benefit of the Lender Creditors, as cash security for the repayment
of Obligations owing to the Lender Creditors as such. If any amounts are held
as cash security pursuant to the immediately preceding sentence, then upon the
termination of all outstanding Letters of Credit, and after the application of
all such cash security to the repayment of all Obligations owing to the Lender
Creditors after giving effect to the termination of all such Letters of Credit,
if there remains any excess cash, such excess cash shall be returned by the Agent
to the First-Lien Collateral Agent for distribution in accordance with Section
7.4(a) hereof.

 

(e)   Except as set forth in
Section 7.4(d), all payments required to be made hereunder shall be made (x) if
to the Lender Creditors, to the Administrative Agent under the Credit Agreement
for the account of the Lender Creditors, and (y) if to the Other Creditors, to
the trustee, paying agent or other similar representative (each, a “Representative”)
for the Other Creditors or, in the absence of such a Representative, directly
to the Other Creditors.

 

(f)   For purposes of applying
payments received in accordance with this Section 7.4, the First-Lien
Collateral Agent shall be entitled to rely upon (i) the Administrative Agent
under the Credit Agreement and (ii) the Representative for the Other Creditors
or, in the absence of such a Representative, upon the Other Creditors for a
determination (which the Administrative Agent, each Representative for any
Secured Creditors and the Secured Creditors agree (or shall agree) to provide
upon request of the First-Lien Collateral Agent) of the outstanding Primary
Obligations, Secondary Obligations and Tertiary Obligations owed to the Lender
Creditors or the Other Creditors, as the case may be.  Unless it has actual knowledge (including by way of written
notice from a Lender Creditor or an Other Creditor) to the contrary, the
Administrative Agent and each Representative, in furnishing information
pursuant to the preceding sentence, and the First-Lien Collateral Agent, in acting
hereunder, shall be entitled to assume that no Secondary Obligations are
outstanding.  Unless it has actual
knowledge (including by way of written notice from an Other Creditor) to the
contrary, the First-Lien Collateral Agent, in acting hereunder, shall be
entitled to assume that no Secured Hedging Agreements are in existence.

 

(g)   It is understood and
agreed that each of the Assignors shall remain liable to the extent of any
deficiency between (x) the amount of the proceeds of the Collateral hereunder
and (y) the aggregate amount of the sums referred to in clause (a) of this
Section with respect to the relevant Assignor.

 

 

7.5.  Remedies Cumulative.  Each and every right, power and remedy
hereby specifically given to the First-Lien Collateral Agent shall be in
addition to every other right, power and remedy specifically given under this
Agreement, the Secured Hedging Agreements or the other Credit Documents or now
or hereafter existing at law, in equity or by statute and each and every right,
power and remedy whether specifically herein given or otherwise existing may be
exercised from time to time or simultaneously and as often and in such order as
may be deemed expedient by the First-Lien Collateral Agent.  All such rights, powers and remedies shall
be cumulative and the exercise or the beginning of the exercise of one shall
not be deemed a waiver of the right to exercise any other or others.  No delay or omission of the First-Lien
Collateral Agent in the exercise of any such right, power or remedy and no
renewal or extension of any of the Obligations shall impair any such right,
power or remedy or shall be construed to be a waiver of any Default or Event of
Default or an acquiescence therein.  No
notice to or demand on any Assignor in any case shall entitle it to any other
or further notice or demand in similar or other circumstances or constitute a
waiver of any of the rights of the First-Lien Collateral Agent to any other or
further action in any circumstances without notice or demand.  In the event that the First-Lien Collateral
Agent shall bring any suit to enforce any of its rights hereunder and shall be
entitled to judgment, then in such suit the First-Lien Collateral Agent may
recover expenses, including attorneys’ fees, and the amounts thereof shall be
included in such judgment.

 

7.6.  Discontinuance of Proceedings.  In case the First-Lien Collateral Agent
shall have instituted any proceeding to enforce any right, power or remedy
under this Agreement by foreclosure, sale, entry or otherwise, and such
proceeding shall have been discontinued or abandoned for any reason or shall
have been determined adversely to the First-Lien Collateral Agent, then and in
every such case the relevant Assignor, the First-Lien Collateral Agent and each
holder of any of the Obligations shall be restored to their former positions
and rights hereunder with respect to the Collateral subject to the security
interest created under this Agreement, and all rights, remedies and powers of
the First-Lien Collateral Agent shall continue as if no such proceeding had
been instituted.

 

ARTICLE
VIII

INDEMNITY

 

8.1.  Indemnity.  (a)  Each Assignor jointly and severally agrees to indemnify,
reimburse and hold the First-Lien Collateral Agent, each other Secured Creditor
and their respective successors, permitted assigns, employees, agents and
servants (hereinafter in this Section 8.1. referred to individually as an “Indemnitee,”
and, collectively, as “Indemnitees”) harmless from any and all
liabilities, obligations, losses, damages, injuries, penalties, claims,
demands, actions, suits, judgments and any and all costs, expenses or
disbursements (including attorneys’ fees and expenses) (for the purposes of
this Section 8.1, the foregoing are collectively called “expenses”) of
whatsoever kind and nature imposed on, asserted against or incurred by any of
the Indemnitees in any way relating to or arising out of this Agreement, any
Secured Hedging Agreement, any other Credit Document or any other document
executed in connection herewith or therewith or in any other way connected with
the administration of the transactions contemplated hereby or thereby or the
enforcement of any of the terms of, or the preservation of

 

 

any rights under any thereof,
or in any way relating to or arising out of the manufacture, ownership,
ordering, purchase, delivery, control, acceptance, lease, financing,
possession, operation, condition, sale, return or other disposition, or use of
the Collateral (including, without limitation, latent or other defects, whether
or not discoverable), the violation of the laws of any country, state or other
governmental body or unit, any tort (including, without limitation, claims
arising or imposed under the doctrine of strict liability, or for or on account
of injury to or the death of any Person (including any Indemnitee), or property
damage), or contract claim; provided that no Indemnitee shall be
indemnified pursuant to this Section 8.1(a) for losses, damages or liabilities
to the extent caused by the gross negligence or willful misconduct of such
Indemnitee.  Each Assignor agrees that
upon written notice by any Indemnitee of the assertion of such a liability,
obligation, loss, damage, injury, penalty, claim, demand, action, suit or
judgment, the relevant Assignor shall assume full responsibility for the
defense thereof.  Each Indemnitee agrees
to use its best efforts to promptly notify the relevant Assignor of any such
assertion of which such Indemnitee has knowledge.

 

(b)   Without limiting the
application of Section 8.1(a), each Assignor agrees, jointly and severally, to
pay, or reimburse the First-Lien Collateral Agent for any and all fees, costs
and expenses of whatever kind or nature incurred in connection with the
creation, preservation or protection of the First-Lien Collateral Agent’s Liens
on, and security interest in, the Collateral, including, without limitation,
all fees and taxes in connection with the recording or filing of instruments
and documents in public offices, payment or discharge of any taxes or Liens
upon or in respect of the Collateral, premiums for insurance with respect to
the Collateral and all other fees, costs and expenses in connection with
protecting, maintaining or preserving the Collateral and the First-Lien
Collateral Agent’s interest therein, whether through judicial proceedings or
otherwise, or in defending or prosecuting any actions, suits or proceedings
arising out of or relating to the Collateral.

 

(c)   Without limiting the
application of Section 8.1(a) or (b), each Assignor agrees, jointly and
severally, to pay, indemnify and hold each Indemnitee harmless from and against
any loss, costs, damages and expenses which such Indemnitee may suffer, expend
or incur in consequence of or growing out of any misrepresentation by any
Assignor in this Agreement, any Secured Hedging Agreement, any other Credit
Document or in any writing contemplated by or made or delivered pursuant to or
in connection with this Agreement, any Secured Hedging Agreement or any other
Credit Document.

 

(d)   If and to the extent that
the obligations of any Assignor under this Section 8.1 are unenforceable for
any reason, such Assignor hereby agrees to make the maximum contribution to the
payment and satisfaction of such obligations which is permissible under
applicable law.

 

8.2.  Indemnity Obligations Secured by
Collateral; Survival.  Any
amounts paid by any Indemnitee as to which such Indemnitee has the right to
reimbursement shall constitute Obligations secured by the Collateral.  The indemnity obligations of each Assignor
contained in this Article VIII shall continue in full force and effect
notwithstanding the full payment of all the Notes issued under the Credit
Agreement, the termination of all Secured Hedging Agreements and Letters of
Credit, and the payment of all other Obligations and notwithstanding the
discharge thereof.

 

 

ARTICLE
IX

DEFINITIONS

 

The following terms shall have the meanings herein specified.  Such definitions shall be equally applicable
to the singular and plural forms of the terms defined.

 

“Administrative Agent” shall have the meaning provided in the
recitals to this Agreement.

 

“Agreement” shall have the meaning provided in the preamble to
this Agreement.

 

“Alternate Perfected Deposit Account” shall have the meaning
provided in Section 3.9(a) of this Agreement.

 

“As-Extracted Collateral” shall mean “as-extracted collateral”
as such term is defined in the Uniform Commercial Code as in effect on the date
hereof in the State of New York.

 

“Assignor” shall have the meaning provided in the preamble to
this Agreement.

 

“Borrower” shall have the meaning provided in the recitals to
this Agreement.

 

“Cash Collateral Account” shall mean a non-interest bearing cash
collateral account maintained with, and in the sole dominion and control of,
the First-Lien Collateral Agent for the benefit of the Secured Creditors.

 

“Chattel Paper” shall have the meaning provided in the Uniform
Commercial Code as in effect on the date hereof in the State of New York.  Without limiting the foregoing, the term
“Chattel Paper” shall in any event include all Tangible Chattel Paper and all
Electronic Chattel Paper.

 

“Class” shall have the meaning provided in Section 10.2 of this
Agreement.

 

“Collateral” shall have the meaning provided in Section 1.1(a)
of this Agreement.

 

“Commercial Tort Claims” shall mean “commercial tort claims” as
such term is defined in the Uniform Commercial Code as in effect on the date
hereof in the State of New York.

 

“Contract Rights” shall mean all rights of any Assignor under
each Contract, including, without limitation, (i) any and all rights to receive
and demand payments under any or all Contracts, (ii) any and all rights to
receive and compel performance under any or all Contracts and (iii) any and all
other rights, interests and claims now existing or in the future arising in
connection with any or all Contracts.

 

“Contracts” shall mean all contracts between any Assignor and
one or more additional parties (including, without limitation, any Secured
Hedging Agreements, licensing

 

 

agreements and any partnership
agreements, joint venture agreements and limited liability company agreements).

 

“Copyrights” shall mean any U.S. or foreign copyright owned by
any Assignor, including any registrations of any Copyright, in the U.S.
Copyright Office or the equivalent thereof in any foreign country, as well as
any application for a U.S. or foreign copyright registration now or hereafter
made with the U.S. Copyright Office or the equivalent thereof in any foreign
jurisdiction by any Assignor.

 

“Credit Agreement” shall have the meaning provided in the
recitals to this Agreement.

 

“Credit Document Obligations” shall have the meaning provided in
the definition of “Obligations” in this Article IX.

 

“Default” shall mean any event which, with notice or lapse of
time, or both, would constitute an Event of Default.

 

“Deposit Accounts” shall mean all “deposit accounts” as such
term is defined in the Uniform Commercial Code as in effect on the date hereof
in the State of New York.

 

“Documents” shall have the meaning provided in the Uniform
Commercial Code as in effect on the date hereof in the State of New York.

 

“Domain Names” shall mean all Internet domain names and
associated URL addresses in or to which any Assignor now or hereafter has any
right, title or interest.

 

“Electronic Chattel Paper” shall mean “electronic chattel paper”
as such term is defined in the Uniform Commercial Code as in effect on the date
hereof in the State of New York.

 

“Equipment” shall mean any “equipment” as such term is defined
in the Uniform Commercial Code as in effect on the date hereof in the State of
New York, and in any event, shall include, but shall not be limited to, all
machinery, equipment, furnishings, fixtures and vehicles now or hereafter owned
by any Assignor and any and all additions, substitutions and replacements of
any of the foregoing and all accessions thereto, wherever located, together
with all attachments, components, parts, equipment and accessories installed
thereon or affixed thereto.

 

“Event of Default” shall mean any Event of Default under, and as
defined in, the Credit Agreement or any payment default under any Secured
Hedging Agreement and shall in any event, without limitation, include any
payment default on any of the Obligations after the expiration of any
applicable grace period.

 

 “Excluded Local Deposit
Account” shall mean (x) each Deposit Account listed on Annex F hereto and
designated as an “Excluded Local Deposit Account” thereon and (y) certain other
Deposit Accounts from time to time not listed on Annex F hereto (all of such
Excluded Local Deposit Accounts described in preceding clauses (x) and (y)
shall, in any such

 

 

case, be local deposit accounts
(and not top-tier concentration accounts or mid-tier concentration accounts (as
jointly determined, in the case of accounts designated as “Excluded Local
Deposit Accounts” after the date of this Agreement, by the First-Lien
Collateral Agent and the relevant Assignor))).

 

 “First-Lien Collateral Agent”
shall have the meaning provided in the preamble to this Agreement.

 

“Excluded Collateral” shall mean, on and after the Accounts
Receivable Facility Transaction Date, any Accounts Receivable Facility Assets
for so long as, and to the extent, same have been sold or transferred pursuant
to the Accounts Receivable Facility Documents, provided that at such
time as, and to the extent that, any such Excluded Collateral is repurchased by
or reconveyed to, an Assignor, such Accounts Receivable Facility Assets shall
cease to constitute Excluded Collateral.

 

“General Intangibles” shall mean “general intangibles” as such
term is defined in the Uniform Commercial Code as in effect on the date hereof
in the State of New York.

 

“Goods” shall mean “goods” as such term is defined in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York.

 

“Health-Care-Insurance Receivable” shall mean any
“health-care-insurance receivable” as such term is defined in the Uniform
Commercial Code as in effect on the date hereof in the State of New York.

 

“Holdings” shall have the meaning provided in the recitals to
this Agreement.

 

“Indemnitee” shall have the meaning provided in Section 8.1 of
this Agreement.

 

“Instrument” shall mean “instruments” as such term is defined in
the Uniform Commercial Code as in effect on the date hereof in the State of New
York.

 

 “Inventory” shall mean
merchandise, inventory and goods, and all additions, substitutions and
replacements thereof, wherever located, together with all goods, supplies,
incidentals, packaging materials, labels, materials and any other items used or
usable in manufacturing, processing, packaging or shipping same; in all stages
of production — from raw materials through work-in-process to finished goods —
and all products and proceeds of whatever sort and wherever located and any portion
thereof which may be returned, rejected, reclaimed or repossessed by the
First-Lien Collateral Agent from any Assignor’s customers, and shall
specifically include all “inventory” as such term is defined in the Uniform
Commercial Code as in effect on the date hereof in the State of New York, now
or hereafter owned by any Assignor.

 

“Investment Property” shall mean “investment property” as such
term is defined in the Uniform Commercial Code as in effect on the date hereof
in the State of New York.

 

“Lender Creditors” shall have the meaning provided in the
recitals to this Agreement.

 

 

“Lenders” shall have the meaning provided in the recitals to
this Agreement.

 

“Letter-of-Credit Rights” shall mean “letter-of-credit rights”
as such term is defined in the Uniform Commercial Code as in effect on the date
hereof in the State of New York.

 

“Liens” shall mean any security interest, mortgage, pledge,
lien, claim, charge, encumbrance, title retention agreement, lessor’s interest
in a financing lease or analogous instrument, in, of, or on any Assignor’s
property.

 

“Location” of any Assignor, shall mean such Assignor’s
“location” as determined pursuant to Section 9-307 of the UCC.

 

“Marks” shall mean all right, title and interest in and to any
U.S. or foreign trademarks, service marks and trade names now held or hereafter
acquired by any Assignor, including any registration or application for
registration of any trademarks and service marks in the United States Patent
and Trademark Office, or the equivalent thereof in any State of the United
States or in any foreign country, and any trade dress including logos, designs,
trade names, company names, business names, fictitious business names and other
business identifiers in connection with which any of these registered or
unregistered marks are used.

 

“Obligations” shall mean (i) the full and prompt payment
when due (whether at the stated maturity, by acceleration or otherwise) of all
obligations (including obligations which, but for the automatic stay under
Section 362(a) of the Bankruptcy Code, would become due) and liabilities
(including, without limitation, indemnities, fees and interest thereon and all
interest that accrues after the commencement of any case, proceeding or other
action relating to the bankruptcy, insolvency, reorganization or similar
proceeding of Holdings or any other Credit Party at the rate provided for in
the respective documentation, whether or not a claim for post-petition interest
is allowed in any such case, proceeding or other action) of each Assignor owing
to the Lender Creditors, now existing or hereafter incurred under, arising out
of or in connection with any Credit Document to which such Assignor is a party
(including all such obligations and indebtedness under any Guaranty to which such
Assignor is a party) and the due performance and compliance by each Assignor
with the terms, conditions and agreements of each such Credit Document (all
such obligations and liabilities under this clause (i), except to the extent
consisting of obligations or indebtedness with respect to Secured Hedging
Agreements, being herein collectively called the “Credit Document
Obligations”); (ii) the full and prompt payment when due (whether at
the stated maturity, by acceleration or otherwise) of all obligations
(including obligations which, but for the automatic stay under Section 362(a)
of the Bankruptcy Code, would become due) and liabilities (including, without
limitation, indemnities, fees and interest thereon and all interest that
accrues after the commencement of any case, proceeding or other action relating
to the bankruptcy, insolvency, reorganization or similar proceeding of Holdings
or any other Credit Party at the rate provided for in the respective
documentation, whether or not a claim for post-petition interest is allowed in
any such case, proceeding or other action) of each Assignor owing to the Other
Creditors, now existing or hereafter incurred under, arising out of or in
connection with each Secured Hedging Agreement, whether such Secured Hedging Agreement
is now in existence or hereafter arises, including, in the case of each
Guarantor, all obligations under the respective Guaranty in respect of Secured
Hedging Agreements, and the

 

 

due performance and compliance
by each Assignor with all of the terms, conditions and agreements contained in
any such Secured Hedging Agreement (all such obligations and indebtedness under
this clause (ii) being herein collectively called the “Other Obligations”);
(iii) any and all sums advanced by the First-Lien Collateral Agent in order to
preserve the Collateral or preserve its security interest in the Collateral;
(iv) in the event of any proceeding for the collection or enforcement of any
indebtedness, obligations, or liabilities of each Assignor referred to in clauses
(i), (ii) and (iii) after an Event of Default shall have occurred and be
continuing, the reasonable expenses of re-taking, holding, preparing for sale
or lease, selling or otherwise disposing of or realizing on the Collateral, or
of any exercise by the First-Lien Collateral Agent of its rights hereunder,
together with reasonable attorneys’ fees and court costs; (v) all amounts paid
by any Indemnitee as to which such Indemnitee has the right to reimbursement
under Section 8.1 of this Agreement; and (vi) all amounts owing to any Agent
pursuant to any of the Credit Documents in its capacity as such.  It is acknowledged and agreed that the
“Obligations” shall include extensions of credit of the types described above,
whether outstanding on the date of this Agreement or extended from time to time
after the date of this Agreement.

 

“Other Creditors” shall have the meaning provided in the
recitals to this Agreement.

 

“Other Obligations” shall have the meaning provided in the
definition of “Obligations” in this Article IX.

 

“Patents” shall mean any patents in or to which any Assignor now
or hereafter has any right, title or interest therein, and any divisions,
continuations (including, but not limited to, continuations-in-parts) and
improvements thereof, as well as any application for a patent now or hereafter
made by any Assignor.

 

“Permits” shall mean, to the extent permitted to be assigned by
the terms thereof or by applicable law, all licenses, permits, rights, orders,
variances, franchises or authorizations (including certificates of need) of or
from any governmental authority or agency.

 

“Primary Obligations” shall have the meaning provided in Section
7.4(b) of this Agreement.

 

“Pro  Rata Share” shall have the meaning provided in
Section 7.4(b) of this Agreement.

 

“Proceeds” shall have the meaning provided in the Uniform
Commercial Code as in effect in the State of New York on the date hereof or
under other relevant law and, in any event, shall include, but not be limited
to, (i) any and all proceeds of any insurance, indemnity, warranty or guaranty
payable to the First-Lien Collateral Agent or any Assignor from time to time
with respect to any of the Collateral, (ii) any and all payments (in any form
whatsoever) made or due and payable to any Assignor from time to time in
connection with any requisition, confiscation, condemnation, seizure or
forfeiture of all or any part of the Collateral by any governmental authority
(or any person acting under color of governmental authority) and (iii) any and
all other amounts from time to time paid or payable under or in connection with
any of the Collateral.

 

 

“Receivables” shall mean any “account” as such term is defined
in the Uniform Commercial Code as in effect on the date hereof in the State of
New York, and in any event shall include but shall not be limited to, all
rights to payment of any monetary obligation, whether or not earned by
performance, (i) for property that has been or is to be sold, leased, licensed,
assigned or otherwise disposed of, (ii) for services rendered or to be
rendered, (iii) for a policy of insurance issued or to be issued, (iv) for a
secondary obligation incurred or to be incurred, (v) for energy provided or to
be provided, (vi) for the use or hire of a vessel under a charter or other contract,
(vii) arising out of the use of a credit or charge card or information
contained on or for use with the card, or (viii) as winnings in a lottery or
other game of chance operated or sponsored by a State, governmental unit of a
State, or person licensed or authorized to operate the game by a State or
governmental unit of a State.  Without
limiting the foregoing, the term “account” shall include all
Health-Care-Insurance Receivables.

 

“Registered Organization” shall have the meaning provided in the
Uniform Commercial Code in effect in the State of New York.

 

“Representative” shall have the meaning provided in Section
7.4(e) of this Agreement.

 

“Requisite Creditors” shall have the meaning provided in Section
10.2 of this Agreement.

 

“Secondary Obligations” shall have the meaning provided in
Section 7.4(b) of this Agreement.

 

“Secured Creditors” shall have the meaning provided in the
recitals to this Agreement.

 

“Secured Hedging Agreement” shall mean and include each Interest
Rate Protection Agreement, each Commodities Agreement and each Other Hedging
Agreement entered into by the Borrower and/or one or more of its Subsidiaries
with any Other Creditor (including each Existing Interest Rate Protection
Agreement).

 

“Software” shall mean “software” as such term is defined in the
Uniform Commercial Code as in effect on the date hereof in the State of New
York.

 

“Subject Deposit Account” shall mean each Deposit Account listed
on Annex F hereto and designated as a “Subject Deposit Account” thereon.

 

“Supporting Obligations” shall mean any “supporting obligation”
as such term is defined in the Uniform Commercial Code as in effect on the date
hereof in the State of New York, now or hereafter owned by any Assignor,
or in which any Assignor has any rights, and, in any event, shall include, but
shall not be limited to all of such Assignor’s rights in any Letter-of-Credit
Right or secondary obligation that supports the payment or performance of, and
all security for, any Receivables, Chattel Paper, Document, General Intangible,
Instrument or Investment Property.

 

 

“Tangible Chattel Paper” shall mean “tangible chattel paper” as
such term is defined in the Uniform Commercial Code as in effect on the date
hereof in the State of New York.

 

“Termination Date” shall have the meaning provided in Section
10.8 of this Agreement.

 

“Tertiary Obligations” shall have the meaning provided in
Section 7.4(b) of this Agreement.

 

“Timber-to-be-Cut” shall mean “timber-to-be-cut” as such term is
defined in the Uniform Commercial Code as in effect on the date hereof in the
State of New York.

 

“Trade Secret Rights” shall mean the rights of any Assignor in
any Trade Secret it holds.

 

“Trade Secrets” means any secretly held existing engineering and
other data, information, production procedures and other know-how relating to
the design, manufacture, assembly, installation, use, operation, marketing,
sale and servicing of any products or business of an Assignor in any location,
whether written or not written.

 

“Transmitting Utility” shall have the meaning given such term in
Section 9-102(a)(80) of the UCC.

 

“UCC” shall mean the Uniform Commercial Code as in effect from
time to time in the relevant jurisdiction.

 

ARTICLE
X

MISCELLANEOUS

 

10.1.  Notices.  Except
as otherwise specified herein, all notices, requests, demands or other
communications to or upon the respective parties hereto shall be deemed to have
been duly given or made when delivered to the party to which such notice,
request, demand or other communication is required or permitted to be given or
made under this Agreement, addressed:

 

(a)           if to any Assignor, at its address
set forth opposite its signature below;

 

(b)           if to the First-Lien Collateral
Agent:

 

Bank of America, N.A., 

Mailcode CA5-701-05-19

1455 Market Street, 5th Floor

San Francisco, CA 94103

Telephone: (415) 436-3495

Facsimile:  (415) 503-5006

Attention:  Charles Graber

 

 

with a copy to:

 

Bank of America, N.A., as First-Lien Collateral Agent

Mailcode NC1-007-13-06

100 N. Tryon Street, 13th Floor

Charlotte, NC 28255

Telephone: (704) 388-6415

Facsimile:  (704) 409-0564

Attention:  Laura Clark

 

(c)           if to any Lender Creditor (other than
the First-Lien Collateral Agent), at such address as such Lender Creditor shall
have specified pursuant to the Credit Agreement; and

 

(d)           if to any Other Creditor, at such
address as such Other Creditor shall have specified in writing to each Assignor
and the First-Lien Collateral Agent;

 

or at such other address as shall have been furnished
in writing by any Person described above to the party required to give notice
hereunder.

 

10.2.  Waiver; Amendment.  None of the terms and conditions of this Agreement may be
changed, waived, modified or varied in any manner whatsoever unless in writing
duly signed by each Assignor directly and adversely affected thereby and the
First-Lien Collateral Agent (with the consent of (x) the Required Lenders (or
all the Lenders if required by Section 13.01 of the Credit Agreement) at all
times prior to the time at which all Credit Document Obligations (other than
those arising from indemnities for which no request has been made) have been
paid in full and all Commitments and Letters of Credit under the Credit
Agreement have been terminated or (y) the holders of at least a majority of the
outstanding Other Obligations at all times after the time on which all Credit
Document Obligations have been paid in full and all Commitments and Letters of
Credit under the Credit Agreement have been terminated); provided, however,
that any change, waiver, modification or variance affecting the rights and
benefits of a single Class (as defined below) of Secured Creditors (and not all
Secured Creditors in a like or similar manner) shall require the written
consent of the Requisite Creditors (as defined below) of such Class of Secured
Creditors.  For the purpose of this
Agreement, the term “Class” shall mean each class of Secured Creditors, i.e.,
whether (x) the Lender Creditors as holders of the Credit Document Obligations
or (y) the Other Creditors as the holders of the Other Obligations.  For the purpose of this Agreement, the term
“Requisite Creditors” of any Class shall mean each of (x) with respect to the
Credit Document Obligations, the Required Lenders and (y) with respect to the
Other Obligations, the holders of at least a majority of all obligations
outstanding from time to time under Secured Hedging Agreements.

 

10.3.  Obligations Absolute.  The obligations of each Assignor hereunder
shall remain in full force and effect without regard to, and shall not be
impaired by, (a) any bankruptcy, insolvency, reorganization, arrangement,
readjustment, composition, liquidation or the like of such Assignor; (b) any
exercise or non-exercise, or any waiver of, any right, remedy, power or
privilege under or in respect of this Agreement, any other Credit Document or
any Secured Hedging Agreement; or (c) any renewal, extension, amendment or
modification of or

 

 

addition or supplement to or
deletion from any Credit Document or any Secured Hedging Agreement or any
security for any of the Obligations; (d) any waiver, consent, extension,
indulgence or other action or inaction under or in respect of any such
agreement or instrument including, without limitation, this Agreement; (e) any
furnishing of any additional security to the First-Lien Collateral Agent or its
assignee or any acceptance thereof or any release of any security by the
First-Lien Collateral Agent or its assignee; or (f) any limitation on any
party’s liability or obligations under any such instrument or agreement or any
invalidity or unenforceability, in whole or in part, of any such instrument or
agreement or any term thereof; whether or not any Assignor shall have notice or
knowledge of any of the foregoing.  The
rights and remedies of the First-Lien Collateral Agent herein provided are
cumulative and not exclusive of any rights or remedies which the First-Lien
Collateral Agent would otherwise have.

 

10.4.  Successors and Assigns.  This Agreement shall be binding upon each
Assignor and its successors and assigns and shall inure to the benefit of the
First-Lien Collateral Agent and its successors and assigns; provided
that no Assignor may transfer or assign any or all of its rights or obligations
hereunder except in accordance with the Credit Agreement and the Secured
Hedging Agreements.  All agreements,
statements, representations and warranties made by each Assignor herein or in
any certificate or other instrument delivered by such Assignor or on its behalf
under this Agreement shall be considered to have been relied upon by the
Secured Creditors and shall survive the execution and delivery of this
Agreement, the other Credit Documents and the Secured Hedging Agreements
regardless of any investigation made by the Secured Creditors or on their
behalf.

 

10.5.  Headings Descriptive.  The headings of the several sections of this
Agreement are inserted for convenience only and shall not in any way affect the
meaning or construction of any provision of this Agreement.

 

10.6.  Governing Law. 
(a)   THIS AGREEMENT AND THE RIGHTS
AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH
AND BE GOVERNED BY THE LAW OF THE STATE OF NEW YORK.  ANY LEGAL ACTION OR PROCEEDING WITH RESPECT
TO THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS OF
THE STATE OF NEW YORK, COUNTY OF NEW YORK, OR OF THE UNITED STATES FOR THE
SOUTHERN DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS
AGREEMENT, EACH ASSIGNOR HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT
OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION
OF THE AFORESAID COURTS. EACH ASSIGNOR HEREBY FURTHER IRREVOCABLY WAIVES ANY
CLAIM THAT ANY SUCH COURTS LACK JURISDICTION OVER SUCH ASSIGNOR, AND AGREES NOT
TO PLEAD OR CLAIM IN ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER CREDIT DOCUMENT BROUGHT IN ANY OF THE AFORESAID COURTS THAT ANY
SUCH COURT LACKS JURISDICTION OVER SUCH ASSIGNOR.  EACH ASSIGNOR FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF
PROCESS OUT OF ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL,
POSTAGE PREPAID, TO ANY SUCH ASSIGNOR AT ITS ADDRESS FOR NOTICES AS PROVIDED

 

 

IN SECTION 10.1 ABOVE, SUCH
SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING.  EACH ASSIGNOR HEREBY IRREVOCABLY WAIVES ANY
OBJECTION TO SUCH SERVICE OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND AGREES
NOT TO PLEAD OR CLAIM IN ANY ACTION OR PROCEEDING COMMENCED HEREUNDER OR UNDER
ANY OTHER CREDIT DOCUMENT THAT SUCH SERVICE OF PROCESS WAS IN ANY WAY INVALID
OR INEFFECTIVE.  NOTHING HEREIN SHALL
AFFECT THE RIGHT OF THE COLLATERAL AGENT UNDER THIS AGREEMENT, OR ANY SECURED
CREDITOR, TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE
LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY ASSIGNOR IN ANY OTHER
JURISDICTION.

 

(b)           EACH ASSIGNOR HEREBY
IRREVOCABLY WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
LAYING OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT OF
OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT BROUGHT IN
THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY FURTHER IRREVOCABLY
WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY SUCH ACTION
OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT
FORUM.

 

(c)           EACH OF THE PARTIES
TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS
AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY
OR THEREBY.

 

10.7.  Assignor’s Duties.  It is expressly agreed, anything herein contained to the contrary
notwithstanding, that each Assignor shall remain liable to perform all of the
obligations, if any, assumed by it with respect to the Collateral and the
First-Lien Collateral Agent shall not have any obligations or liabilities with
respect to any Collateral by reason of or arising out of this Agreement, nor
shall the First-Lien Collateral Agent be required or obligated in any manner to
perform or fulfill any of the obligations of any Assignor under or with respect
to any Collateral.

 

10.8.  Termination; Release.  (a) 
After the Termination Date (as defined below), this Agreement shall
terminate (provided that all indemnities set forth herein including,
without limitation, in Section 8.1 hereof shall survive such termination) and
the First-Lien Collateral Agent, at the request and expense of the respective
Assignor, will promptly execute and deliver to such Assignor a proper instrument
or instruments (including Uniform Commercial Code termination statements on
form UCC-3) acknowledging the satisfaction and termination of this Agreement,
and will duly assign, transfer and deliver to such Assignor (without recourse
and without any representation or warranty) such of the Collateral as may be in
the possession of the First-Lien Collateral Agent and as has not theretofore
been sold or otherwise applied or released pursuant to this Agreement.  As used in this Agreement, “Termination
Date” shall mean the date upon which the Total Commitment and all Secured
Hedging Agreements have been terminated, no Note is outstanding (and all Loans
have been paid in full), all Letters of Credit have been

 

 

terminated and all other
Obligations (other than those arising from indemnities for which no request has
been made) then owing have been paid in full.

 

(b)   In the event that any part
of the Collateral is sold or otherwise disposed of (to a Person other than
Holdings or a Subsidiary thereof) (x) at any time prior to the time at which
all Credit Document Obligations have been paid in full and all Commitments
under the Credit Agreement have been terminated, (i) in connection with a sale
or other disposition permitted by Section 9.02 of the Credit Agreement or (ii)
pursuant to a sale consented to in writing by the Required Lenders (or all the
Lenders if required by Section 13.01 of the Credit Agreement) or (y) at any
time thereafter, in accordance with the terms of the Secured Hedging
Agreements, and the proceeds of any such sale or disposition are applied in
accordance with the terms of the Credit Agreement or such Secured Hedging
Agreements, as the case may be, to the extent required to be so applied, the
First-Lien Collateral Agent, at the request and expense of such Assignor, will
(i) duly assign, transfer and deliver to such Assignor (without recourse and
without any representation or warranty) such of the Collateral as is then being
(or has been) so sold, disposed of or released and as may be in the possession
of the First-Lien Collateral Agent and has not theretofore been released
pursuant to this Agreement and/or (ii) execute such releases and discharges in
respect of such Collateral as is then being (or has been) so sold, disposed of
or released as such Assignor may reasonably request.

 

(c)   In the event that any part
of the Collateral is pledged (or is to be pledged concurrently with any release
or subordination effected pursuant to this Section 10.8(c)) in support of
permitted secured Indebtedness pursuant to the provisions of Section
9.03(xviii) and 9.04(xviii) of the Credit Agreement, the First-Lien Collateral
Agent, at the request and expense of the relevant Assignor, will (i) duly
assign, transfer and deliver to such Assignor (without recourse and without any
representation or warranty) such of the Collateral then being pledged in
support of such other Indebtedness (to the extent such Collateral is of the
type permitted to be pledged in support of such Indebtedness pursuant to the
provisions of Section 9.03(xviii) of the Credit Agreement), as may be in the
possession of the First-Lien Collateral Agent and has not theretofore been
released pursuant to this Agreement and/or (ii) execute such releases,
discharges or lien subordination agreements in respect of such Collateral as is
then being pledged in support of such other Indebtedness as such Assignor may
reasonably request.

 

(d)   At any time that the
respective Assignor desires that Collateral be released as provided in the
foregoing Section 10.8(a) or (b), it shall deliver to the First-Lien Collateral
Agent a certificate signed by an Authorized Officer stating that the release of
the respective Collateral is permitted pursuant to Section 10.8(a) or (b).  If requested by the First-Lien Collateral Agent
(although the First-Lien Collateral Agent shall have no obligation to make any
such request), the relevant Assignor shall furnish appropriate legal opinions
(from counsel, which may be in-house counsel, reasonably acceptable to the
First-Lien Collateral Agent) to the effect set forth in the immediately
preceding sentence.  The First-Lien
Collateral Agent shall have no liability whatsoever to any Secured Creditor as
the result of any release of Collateral by it as permitted (or which the
First-Lien Collateral Agent in the absence of gross negligence or willful
misconduct believes to be permitted) by this Section 10.8.

 

(e)  If at any time all of the equity interests
of any Assignor owned by the Borrower or any of its Subsidiaries are sold (to a
Person other than a Credit Party) in a

 

 

transaction permitted pursuant
to the Credit Agreement (and which does not violate the terms of any other
Secured Debt Agreement then in effect), then, such Assignor shall be released
as an Assignor pursuant to this Agreement without any further action hereunder
(it being understood that the sale of all of the equity interests in any Person
that owns, directly or indirectly, all of the equity interests in any Assignor
shall be deemed to be a sale of all of the equity interests in such Assignor
for purposes of this Section), and the First-Lien Collateral Agent is
authorized and directed to execute and deliver such instruments of release as
are reasonably satisfactory to it.  At
any time that the Borrower desires that an Assignor be released from this
Agreement as provided in this Section 10.8(e), the Borrower shall deliver to
the First-Lien Collateral Agent a certificate signed by a principal executive
officer of the Borrower stating that the release of such Assignor is permitted
pursuant to this Section 10.8(e).  If
requested by First-Lien Collateral Agent (although the First-Lien Collateral
Agent shall have no obligation to make any such request), the Borrower shall
furnish legal opinions (from counsel acceptable to the First-Lien Collateral
Agent) to the effect set forth in the immediately preceding sentence.  The First-Lien Collateral Agent shall have
no liability whatsoever to any other Secured Creditor as a result of the
release of any Assignor by it in accordance with, or which it believes to be in
accordance with, this Section 10.8(e).

 

10.9.  Counterparts.  This Agreement may be
executed in any number of counterparts and by the different parties hereto on
separate counterparts, each of which when so executed and delivered shall be an
original, but all of which shall together constitute one and the same
instrument.  A set of counterparts
executed by all the parties hereto shall be lodged with the Borrower and the
First-Lien Collateral Agent.

 

10.10.  The First-Lien Collateral Agent.  The First-Lien Collateral Agent will hold in
accordance with this Agreement all items of the Collateral at any time received
under this Agreement.  It is expressly
understood and agreed that the obligations of the First-Lien Collateral Agent as
holder of the Collateral and interests therein and with respect to the
disposition thereof, and otherwise under this Agreement, are only those
expressly set forth in this Agreement. 
The First-Lien Collateral Agent shall act hereunder on the terms and conditions
set forth in Section 12 of the Credit Agreement.

 

10.11.  Severability.  Any provision of this
Agreement which is prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof, and any such prohibition
or unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.

 

10.12.  Fraudulent Conveyance; Etc.  It is the desire and intent of each Assignor
and the Secured Creditors that this Agreement shall be enforced against each
Assignor to the fullest extent permissible under the laws and public policies
applied in each jurisdiction in which enforcement is sought.  Notwithstanding anything to the contrary
contained herein, in furtherance of the foregoing, it is noted that the
obligations of each Subsidiary Guarantor constituting an Assignor are limited
as, and to the extent, provided in Section 24 of the Subsidiaries Guaranty.

 

 

10.13.  Additional Assignors.  It is understood and agreed that any
Subsidiary of the Borrower that is required to become a party to this Agreement
after the date hereof pursuant to the requirements of the Credit Agreement
shall become an Assignor hereunder by (x) executing a counterpart hereof and
delivering same to the First-Lien Collateral Agent, or by executing and
delivering to the First-Lien Collateral Agent an assumption agreement in form
and substance satisfactory to the First-Lien Collateral Agent, (y) delivering
supplements to Annexes A through M hereto as are necessary to cause such
annexes to be complete and accurate with respect to such additional Assignor on
such date and (z) taking all actions as specified in this Agreement as would
have been taken by such Assignor had it been an original party to this
Agreement, in each case with all documents required above to be delivered to
the First-Lien Collateral Agent and with all documents and actions required
above to be taken to the reasonable satisfaction of the First-Lien Collateral
Agent.

 

*              *              *

 

 

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

 

	
  2366 Bernville
  Road

  	
  ENERSYS,

  
	
  Reading, PA,
  19605

  	
  as an
  Assignor

  
	
  Telephone:  (610) 208-1991

  	
   

  
	
  Facsimile:  (610) 208-1671

  	
   

  
	
  Attention:
  Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366
  Bernville Road

  	
  ENERSYS
  CAPITAL INC.,

  
	
  Reading, PA,
  19605

  	
  as an
  Assignor

  
	
  Telephone:  (610) 208-1991

  	
   

  
	
  Facsimile:  (610) 208-1671

  	
   

  
	
  Attention:
  Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366
  Bernville Road

  	
  ENERSYS
  DELAWARE INC.,

  
	
  Reading, PA,
  19605

  	
  as an
  Assignor

  
	
  Telephone:  (610) 208-1991

  	
   

  
	
  Facsimile:  (610) 208-1671

  	
   

  
	
  Attention:
  Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366
  Bernville Road

  	
  ESFINCO,
  INC.,

  
	
  Reading, PA,
  19605

  	
  as an
  Assignor

  
	
  Telephone:  (610) 208-1991

  	
   

  
	
  Facsimile:  (610) 208-1671

  	
   

  
	
  Attention:
  Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 

	
  2366 Bernville
  Road

  	
  ESRMCO,
  INC.,

  
	
  Reading, PA,
  19605

  	
  as an
  Assignor

  
	
  Telephone:  (610) 208-1991

  	
   

  
	
  Facsimile:  (610) 208-1671

  	
   

  
	
  Attention:
  Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366
  Bernville Road

  	
  HAWKER
  ENERGY PRODUCTS INC.,

  
	
  Reading, PA,
  19605

  	
  as an Assignor

  
	
  Telephone:  (610) 208-1991

  	
   

  
	
  Facsimile:  (610) 208-1671

  	
   

  
	
  Attention:
  Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366
  Bernville Road

  	
  HAWKER POWER
  SYSTEMS, INC.,

  
	
  Reading, PA,
  19605

  	
  as an
  Assignor

  
	
  Telephone:  (610) 208-1991

  	
   

  
	
  Facsimile:  (610) 208-1671

  	
   

  
	
  Attention:
  Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366
  Bernville Road

  	
  POWERSAFE
  STANDBY BATTERIES INC.,

  
	
  Reading, PA,
  19605

  	
  as an
  Assignor

  
	
  Telephone:  (610) 208-1991

  	
   

  
	
  Facsimile:  (610) 208-1671

  	
   

  
	
  Attention:
  Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
  2366
  Bernville Road

  	
  HAWKER
  POWERSOURCE, INC.,

  
	
  Reading, PA,
  19605

  	
  as an
  Assignor

  
	
  Telephone:  (610) 208-1991

  	
   

  
	
  Facsimile:  (610) 208-1671

  	
   

  
	
  Attention:
  Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 

	
  2366
  Bernville Road

  	
  NEW PACIFICO
  REALTY, INC.,

  
	
  Reading, PA,
  19605

  	
  as an
  Assignor

  
	
  Telephone:  (610) 208-1991

  	
   

  
	
  Facsimile:  (610) 208-1671

  	
   

  
	
  Attention:
  Michael T. Philion

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 

	
  Accepted and
  Agreed to

  
	
   

  
	
  BANK OF
  AMERICA, N.A.,

  
	
  as First
  Lien Collateral Agent, as Assignee

  
	
   

  
	
   

  
	
  By

  	
   

  	
   

  
	
  Title:

  

 

 

 

	
  ANNEX A

  	
   

  
	
  TO

  	
   

  
	
  SECURITY AGREEMENT

  	
   

  

 

 

 

SCHEDULE OF CHIEF EXECUTIVE OFFICES/RECORD LOCATIONS

 

 

	
  ANNEX B

  	
   

  
	
  TO

  	
   

  
	
  SECURITY AGREEMENT

  	
   

  

 

 

 

SCHEDULE OF INVENTORY AND EQUIPMENT LOCATIONS

 

 

 

 

	
  ANNEX C

  	
   

  
	
  TO

  	
   

  
	
  SECURITY AGREEMENT

  	
   

  

 

 

 

SCHEDULE OF LEGAL NAMES,
TYPE OF ORGANIZATION

(AND WHETHER A REGISTERED ORGANIZATION AND/OR

A TRANSMITTING UTILITY), JURISDICTION OF ORGANIZATION,

LOCATION AND ORGANIZATIONAL IDENTIFICATION NUMBERS

 

	
  Exact Legal

  Name of Each

  Assignor

  	
   

  	
  Type of

  Organization (or,

  if the Assignor is

  an Individual,

  so indiate)

  	
   

  	
  Registered

  Organization?

  (Yes/No)

  	
   

  	
  Jurisdiction

  of

  Organization

  	
   

  	
  Assignor’s

  Location

  (for purposes

  of NY UCC

  § 9-307)

  	
   

  	
  Assignor’s

  Organization

  Identification

  Number (or,

  if it has none,

  so indicate)

  	
   

  	
  Transmitting

  Utility?

  (Yes/No)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

 

	
  ANNEX D

  	
   

  
	
  TO

  	
   

  
	
  SECURITY AGREEMENT

  	
   

  

 

 

 

SCHEDULE OF TRADE AND
FICTITIOUS NAMES

 

 

 

	
  ANNEX E

  	
   

  
	
  TO

  	
   

  
	
  SECURITY AGREEMENT

  	
   

  

 

 

 

DESCRIPTION OF CERTAIN
SIGNIFICANT

TRANSACTIONS OCCURRING WITHIN ONE YEAR

PRIOR TO THE DATE OF THE SECURITY AGREEMENT

 

	
  Name of
  Assignor

  	
   

  	
  Description
  of any Transactions as required

  by Section 2.8 of the Security Agreement

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

 

 

	
  ANNEX F

  	
   

  
	
  TO

  	
   

  
	
  SECURITY AGREEMENT

  	
   

  

 

 

 

SCHEDULE OF DEPOSIT ACCOUNTS

 

	
  Name of Assignor

  	
   

  	
  Description
  of

  Deposit Account

  	
   

  	
  Account

  Number

  	
   

  	
  Name of
  Bank,

  Address and

  Contact

  Information

  	
   

  	
  Jurisdiction
  of

  Bank (determined

  in accordance with

  UCC § 9-304)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

 

	
  ANNEX G

  	
   

  
	
  TO

  	
   

  
	
  SECURITY AGREEMENT

  	
   

  

 

 

 

Form of Control Agreement Regarding Deposit Accounts

 

AGREEMENT (as amended, modified, restated and/or supplemented from time
to time, this “Agreement”), dated as of
[              
     ,        ],
among the undersigned assignor (the “Assignor”), Bank of America, N.A.,
not in its individual capacity but solely as Collateral Agent under the
First-Lien Security Agreement referred to below (in such capacity, the “First-Lien
Collateral Agent”), Bank of America, N.A., not in its individual capacity
but solely as Collateral Agent under the Second-Lien Security Agreement
referred to below (in such capacity, the “Second-Lien Collateral Agent”),
and
[              ]
(the “Deposit Account Bank”), as the bank (as defined in Section 9-102
of the UCC as in effect on the date hereof in the State of
[                      ]
(the “UCC”)) with which one or more deposit accounts (as defined in
Section 9-102 of the UCC) are maintained by the Assignor (with all such deposit
accounts now or at any time in the future maintained by the Assignor with the
Deposit Account Bank being herein called the “Deposit Accounts”).

 

W I T N E S S E T H :

 

WHEREAS, the Assignor, various other Assignors and the First-Lien
Collateral Agent have entered into a First-Lien Security Agreement, dated as of
March 17, 2004 (as amended, restated, modified and/or supplemented from time to
time, the “First-Lien Security Agreement”), under which, among other
things, in order to secure the payment of the Obligations (as defined in the
First-Lien Security Agreement), the Assignor has granted a security interest to
the First-Lien Collateral Agent for the benefit of the Secured Creditors (as
defined in the First-Lien Security Agreement) in all of the right, title and
interest of the Assignor in and into any and all deposit accounts (as defined
in Section 9-102 of the UCC) and in all monies, securities, instruments and
other investments deposited therein from time to time (collectively, herein
called the “First-Lien Collateral”);

 

WHEREAS, the Assignor, various other Assignors and the Second-Lien
Collateral Agent have entered into a Second-Lien Security Agreement, dated as
of March 17, 2004 (as amended, restated, modified and/or supplemented from time
to time, the “Second-Lien Security Agreement” and, together with the
First-Lien Security Agreement, the “Security Agreements”), under which,
among other things, in order to secure the payment of the Obligations (as
defined in the Second-Lien Security Agreement), the Assignor has granted a
security interest to the Second-Lien Collateral Agent for the benefit of the
Secured Creditors (as defined in the Second-Lien Security Agreement) in all of
the right, title and interest of the Assignor in and into any and all deposit
accounts (as defined in Section 9-102 of the UCC) and in all monies,
securities, instruments and other investments deposited therein from time to
time

 

 

(collectively, herein called
the “Second-Lien Collateral”, and together with the First-Lien
Collateral, the “Collateral”);

 

WHEREAS, EnerSys, [the Assignor] [EnerSys Capital Inc.], the First-Lien
Collateral Agent and the Second-Lien Collateral Agent have entered into an
Intercreditor Agreement, dated as of March 17, 2004 (as amended, restated,
modified and/or supplemented from time to time, the “Intercreditor Agreement”),
governing the relative rights and priorities of the Secured Creditors (as
defined in each Security Agreement) in respect of the Collateral; and

 

WHEREAS, the Assignor desires that the Deposit Account Bank enter into
this Agreement in order to establish “control” (as defined in Section 9-104 of
the UCC) in each Deposit Account at any time or from time to time maintained
with the Deposit Account Bank, and to provide for the rights of the parties under
this Agreement with respect to such Deposit Accounts;

 

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

 

1.             Assignor’s
Dealings with Deposit Accounts; Notice of Exclusive Control. Until the
Deposit Account Bank shall have received from the First-Lien Collateral Agent
and/or the Second-Lien Collateral Agent a Notice of Exclusive Control (as
defined below), the Assignor shall be entitled to present items drawn on and
otherwise to withdraw or direct the disposition of funds from the Deposit
Accounts and give instructions in respect of the Deposit Accounts; provided,
however, that the Assignor may not, and the Deposit Account Bank agrees
that it shall not permit the Assignor to, close any Deposit Account, in any
case without the prior written consent of each of the First-Lien Collateral
Agent and the Second-Lien Collateral Agent. 
If the First-Lien Collateral Agent or the Second-Lien Collateral Agent
shall give to the Deposit Account Bank a notice of the First-Lien Collateral
Agent’s or the Second-Lien Collateral Agent’s exclusive control of the Deposit
Accounts, which notice states that it is a “Notice of Exclusive Control” (a “Notice
of Exclusive Control”), only the First-Lien Collateral Agent or the
Second-Lien Collateral Agent, as the case may be, shall be entitled to withdraw
funds from the Deposit Accounts, to give any instructions in respect of the
Deposit Accounts and any funds held therein or credited thereto or otherwise to
deal with the Deposit Accounts.

 

2.             First-Lien
Collateral Agent’s and Second-Lien Collateral Agent’s Rights to Give
Instructions as to Deposit Accounts. 
(a)  Notwithstanding the foregoing or any separate agreement
that the Assignor may have with the Deposit Account Bank, each of the
First-Lien Collateral Agent and the Second-Lien Collateral Agent shall be
entitled, for purposes of this Agreement, at any time to give the Deposit
Account Bank instructions as to the withdrawal or disposition of any funds from
time to time credited to any Deposit Account, or as to any other matters
relating to any Deposit Account or any other Collateral, without further
consent from the Assignor.  The Assignor
hereby irrevocably authorizes and instructs the Deposit Account Bank, and the
Deposit Account Bank hereby agrees, to comply with any such instructions from
the First-Lien Collateral Agent and/or the Second-Lien Collateral Agent without
any further consent from the Assignor. 
Such instructions may include the giving of stop payment orders for any

 

 

items being presented to any
Deposit Account for payment.  The
Deposit Account Bank shall be fully entitled to rely on, and shall comply with,
such instructions from the First-Lien Collateral Agent or the Second-Lien
Collateral Agent even if such instructions are contrary to any instructions or
demands that the Assignor may give to the Deposit Account Bank.  In case of any conflict between instructions
received by the Deposit Account Bank from the First-Lien Collateral Agent or
the Second-Lien Collateral Agent, on the one hand, and the Assignor, on the
other hand, the instructions from the First-Lien Collateral Agent or the
Second-lien Collateral Agent, as the case may be, shall prevail.  In case of any conflict between instructions
received by the Deposit Account Bank from the First-Lien Collateral Agent and
the Second-Lien Collateral Agent, the instructions from the First-Lien
Collateral Agent shall prevail.

 

(b)           It is understood and agreed that the
Deposit Account Bank’s duty to comply with instructions from the First-Lien
Collateral Agent and the Second-Lien Collateral Agent regarding the Deposit
Accounts is absolute, and the Deposit Account Bank shall be under no duty or
obligation, nor shall it have the authority, to inquire or determine whether or
not such instructions are in accordance with the Security Agreements, the
Intercreditor Agreement or any other Credit Document (as defined in each of the
Security Agreements), nor seek confirmation thereof from the Assignor or any
other Person.

 

3.             Assignor’s
Exculpation and Indemnification of Depository Bank.  The Assignor hereby irrevocably authorizes
and instructs the Deposit Account Bank to follow instructions from each of the
First-Lien Collateral Agent and the Second-Lien Collateral Agent regarding the
Deposit Accounts even if the result of following such instructions from the
First-Lien Collateral Agent or the Second-lien collateral Agent is that the
Deposit Account Bank dishonors items presented for payment from any Deposit
Account.  The Assignor further confirms
that the Deposit Account Bank shall have no liability to the Assignor for
wrongful dishonor of such items in following such instructions from the
First-Lien Collateral Agent or the Second-Lien Collateral Agent.  The Deposit Account Bank shall have no duty
to inquire or determine whether the Assignor’s obligations to the First-Lien
Collateral Agent or the Second-Lien Collateral Agent are in default or whether
the First-Lien Collateral Agent or the Second-Lien Collateral Agent is
entitled, under any separate agreement between the Assignor and the First-Lien
Collateral Agent or the Second-Lien Collateral Agent, to give any such
instructions.  The Assignor further
agrees to be responsible for the Deposit Account Bank’s customary charges and
to indemnify the Deposit Account Bank from and to hold the Deposit Account Bank
harmless against any loss, cost or expense that the Deposit Account Bank may
sustain or incur in acting upon instructions which the Deposit Account Bank
believes in good faith to be instructions from the First-Lien Collateral Agent
or the Second-Lien Collateral Agent.

 

4.             Subordination of
Security Interests; Deposit Account Bank’s Recourse to Deposit Accounts.  The Deposit Account Bank hereby subordinates
any claims and security interests it may have against, or with respect to, any
Deposit Account at any time established or maintained with it by the Assignor
(including any amounts, investments, instruments or other Collateral from time
to time on deposit therein) to the security interests of the First-Lien
Collateral Agent (for the benefit of the Secured Creditors under, and as
defined in, the First-Lien Security Agreement) and the Second-Lien Collateral
Agent (for the benefit of the Secured Creditors under, and as defined in, the
Second-Lien Security Agreement), and agrees that no

 

 

amounts shall be charged by it
to, or withheld or set-off or otherwise recouped by it from, any Deposit
Account of the Assignor or any amounts, investments, instruments or other
Collateral from time to time on deposit therein; provided that the
Deposit Account Bank may, however, from time to time debit the Deposit Accounts
for any of its customary charges in maintaining the Deposit Accounts or for
reimbursement for the reversal of any provisional credits granted by the
Deposit Account Bank to any Deposit Account, to the extent, in each case, that
the Assignor has not separately paid or reimbursed the Deposit Account Bank
therefor.

 

5.             Representations,
Warranties and Covenants of Deposit Account Bank.  The Deposit Account Bank represents and warrants to the
First-Lien Collateral Agent and the Second-Lien Collateral Agent and hereby
agrees that:

 

(a)           The Deposit Account
Bank constitutes a “bank” (as defined in Section 9-102 of the UCC), that the
jurisdiction (determined in accordance with Section 9-304 of the UCC) of the
Deposit Account Bank for purposes of each Deposit Account maintained by the
Assignor with the Deposit Account Bank is
                                .

 

(b)           The Deposit Account
Bank shall not permit any Assignor to establish any demand, time, savings,
passbook or other account with it which does not constitute a “deposit account”
(as defined in Section 9-102 of the UCC).

 

(c)           The Deposit Account
Bank will not, without the prior written consent of each of the First-Lien
Collateral Agent and the Second-Lien Collateral Agent, amend any account
agreement between it and the Assignor governing any Deposit Account so that the
Deposit Account Bank’s jurisdiction for purposes of Section 9-304 of the
UCC is other than the jurisdiction specified in the preceding clause (a).  All account agreements in respect of each
Deposit Account in existence on the date hereof are listed on Annex F hereto
and copies of all such account agreements have been furnished to the First-Lien
Collateral Agent and the Second-Lien Collateral Agent.  The Deposit Account Bank will promptly furnish
to the First-Lien Collateral Agent and the Second-Lien Collateral Agent a copy
of the account agreement for each Deposit Account hereafter established by the
Deposit Account Bank for the Assignor.

 

(d)           The Deposit Account
Bank has not entered and will not enter, into any agreement with any other
Person by which the Deposit Account Bank is obligated to comply with
instructions from such other Person as to the disposition of funds from any
Deposit Account or other dealings with any Deposit Account or other of the
Collateral.

 

(e)           On the date hereof,
the Deposit Account Bank maintains no Deposit Accounts for the Assignor other
than the Deposit Accounts specifically identified in Annex F hereto.

 

(f)            Any items or funds
received by the Deposit Account Bank for the Assignor’s account will be
credited to said Deposit Accounts specified in paragraph (e) above or to any
other Deposit Accounts hereafter established by the Deposit Account Bank for
the Assignor in accordance with this Agreement.

 

 

(g)           The Deposit Account
Bank will promptly notify the First-Lien Collateral Agent and the Second-Lien
Collateral Agent of each Deposit Account hereafter established by the Deposit
Account Bank for the Assignor (which notice shall specify the account number of
such Deposit Account and the location at which the Deposit Account is
maintained), and each such new Deposit Account shall be subject to the terms of
this Agreement in all respects.

 

6.             Deposit Account
Statements and Information.  The
Deposit Account Bank agrees, and is hereby authorized and instructed by the
Assignor, to furnish to each of the First-Lien Collateral Agent and the
Second-Lien Collateral Agent, at its address indicated below, copies of all
account statements and other information relating to each Deposit Account that
the Deposit Account Bank sends to the Assignor and to disclose to the
First-Lien Collateral Agent and the Second-Lien Collateral Agent all
information requested by the First-Lien Collateral Agent or the Second-Lien
Collateral Agent, as the case may be, regarding any Deposit Account.

 

7.             Conflicting
Agreements.  This Agreement shall
have control over any conflicting agreement between the Deposit Account Bank
and the Assignor.

 

8.             Merger or
Consolidation of Deposit Account Bank. 
Without the execution or filing of any paper or any further act on the
part of any of the parties hereto, any bank into which the Deposit Account Bank
may be merged or with which it may be consolidated, or any bank resulting from
any merger to which the Deposit Account Bank shall be a party, shall be the
successor of the Deposit Account Bank hereunder and shall be bound by all
provisions hereof which are binding upon the Deposit Account Bank and shall be
deemed to affirm as to itself all representations and warranties of the Deposit
Account Bank contained herein.

 

9.             Notices.  (a) 
All notices and other communications provided for in this Agreement
shall be in writing (including facsimile) and sent to the intended recipient at
its address or telex or facsimile number set forth below:

 

If to the First-Lien Collateral Agent or the
Second-Lien Collateral Agent, at:

 

Bank of America, N.A., 

Mailcode CA5-701-05-19

1455 Market Street, 5th Floor

San Francisco, CA 94103

Telephone: (415) 436-3495

Facsimile:  (415) 503-5006

Attention:  Charles Graber

 

with a copy to:

 

Bank
of America, N.A., 

Mailcode
NC1-007-13-06

100
N. Tryon Street, 13th Floor

Charlotte,
NC 28255

 

 

	
  Telephone: (704) 388-6415

  
	
  Facsimile:  (704) 409-0564

  
	
  Attention:  Laura Clark

  
	
   

  
	
  If to the Assignor, at:

  
	
   

  
	
   

  
	
   

  
	
   

  
	
  If to the Deposit Account Bank, at:

  
	
   

  
	
   

  
	
   

  
	
   

  

 

or, as to any party, to such
other address or telex or facsimile number as such party may designate from
time to time by notice to the other parties.

 

(b)           Except as otherwise
provided herein, all notices and other communications hereunder shall be
delivered by hand or by commercial overnight courier (delivery charges
prepaid), or mailed, postage prepaid, or telexed or faxed, addressed as
aforesaid, and shall be effective (i) three business days after being deposited
in the mail (if mailed), (ii) when delivered (if delivered by hand or courier)
and (iii) or when transmitted with receipt confirmed (if telexed or faxed);
provided that notices to the First-Lien Collateral Agent or the Second-Lien
Collateral Agent shall not be effective until actually received by it.

 

10.           Amendment.  This Agreement may not be amended, modified
or supplemented except in writing executed and delivered by all the parties
hereto.

 

11.           Binding Agreement.  This Agreement shall bind the parties hereto
and their successors and assign and shall inure to the benefit of the parties
hereto and their successors and assigns. 
Without limiting the provisions of the immediately preceding sentence,
the First-Lien Collateral Agent or the Second-Lien Collateral Agent may at any
time or from time to time designate in writing to the Deposit Account Bank a
successor First-Lien Collateral Agent or Second-Lien Collateral Agent, as the
case may be (at such time, if any, as such entity becomes the “First-Lien Collateral
Agent” under the First-Lien Security Agreement or the “Second-Lien Collateral
Agent” under the Second-Lien Security Agreement, or at any time thereafter),
and such successor shall thereafter succeed to the rights of the existing
First-Lien Collateral Agent or Second-Lien Collateral Agent, as the case may
be,  hereunder and shall be entitled to
all of the rights and benefits provided hereunder.

 

12.           Continuing
Obligations.  The rights and powers
granted herein to each of the First-Lien Collateral Agent and the Second-Lien
Collateral Agent have been granted in order to protect and further perfect its
security interests in the Deposit Accounts and other relevant Collateral and
are powers coupled with an interest and will be affected neither by any purported

 

 

revocation by the Assignor of
this Agreement or the rights granted to the First-Lien Collateral Agent or the
Second-Lien Collateral Agent hereunder or by the bankruptcy, insolvency,
conservatorship or receivership of the Assignor, the Deposit Account Bank, the
First-Lien Collateral Agent or the Second-Lien Collateral Agent or by the lapse
of time.  The rights of the First-Lien
Collateral Agent hereunder and in respect of the Deposit Accounts and the other
First-Lien Collateral, and the obligations of the Assignor and Deposit Account
Bank hereunder, shall continue in effect until the security interests of the
First-Lien Collateral Agent in the Deposit Accounts and such other First-Lien
Collateral have been terminated and the First-Lien Collateral Agent has
notified the Deposit Account Bank of such termination in writing.  The rights of the Second-Lien Collateral
Agent hereunder and in respect of the Deposit Accounts and the other
Second-Lien Collateral, and the obligations of the Assignor and Deposit Account
Bank hereunder, shall continue in effect until the security interests of the
Second-Lien Collateral Agent in the Deposit Accounts and such other Second-Lien
Collateral have been terminated and the Second-Lien Collateral Agent has
notified the Deposit Account Bank of such termination in writing.

 

13.           Compliance with
Intercreditor Agreement.  The
First-Lien Collateral Agent and the Second-Lien Collateral Agent hereby
acknowledge and agree as between themselves that, notwithstanding anything
herein to the contrary, the exercise of any right or remedy by the Second-Lien
Collateral Agent hereunder (including, without limitation, its right to deliver
a Notice of Exclusive Control or any other instruction to the Deposit Account
Bank and to withdraw funds from a Deposit Account) is subject to the provisions
of the Intercreditor Agreement.

 

14.           Governing Law.  This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.

 

15.           Counterparts.  This Agreement may be executed in any number
of counterparts, all of which shall constitute one and the same instrument, and
any party hereto may execute this Agreement by signing and delivering one or
more counterparts.

 

[Remainder
of this page intentionally left blank; signature page follows]

 

 

IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the date first written above.

 

	
   

  	
  Assignor:

  
	
   

  	
   

  
	
   

  	
  [NAME OF ASSIGNOR]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  First-Lien Collateral
  Agent:

  
	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  Second-Lien Collateral Agent:

  
	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Deposit Account Bank:

  
	
   

  	
   

  
	
   

  	
  [NAME OF DEPOSIT
  ACCOUNT BANK]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

 

 

	
  ANNEX H

  	
   

  
	
  TO

  	
   

  
	
  SECURITY AGREEMENT

  	
   

  

 

 

 

 

DESCRIPTION OF COMMERCIAL
TORT CLAIMS

 

	
  Name of Assignor

  	
   

  	
  Description of Commercial Tort Claims

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

 

 

	
  ANNEX I

  	
   

  
	
  TO

  	
   

  
	
  SECURITY AGREEMENT

  	
   

  

 

 

 

SCHEDULE OF MARKS AND
APPLICATIONS;

INTERNET DOMAIN NAME REGISTRATIONS

 

[Company to Provide Schedule Updated from Existing Deal]

 

1.             Marks
and Applications:

 

	
  Marks

  	
   

  	
  Country

  	
   

  	
  Registration No.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

2.             Internet
Domain Name Registrations:

 

	
  Marks

  	
   

  	
  Country

  	
   

  	
  Registration No. (or other applicable identifier)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

 

 

	
  ANNEX J

  	
   

  
	
  TO

  	
   

  
	
  SECURITY AGREEMENT

  	
   

  

 

 

 

 

SCHEDULE OF PATENTS AND
APPLICATIONS

 

[Company to Provide Schedule Updated from Existing Deal]

 

 

 

	
  ANNEX K

  	
   

  
	
  TO

  	
   

  
	
  SECURITY AGREEMENT

  	
   

  

 

 

 

 

SCHEDULE OF COPYRIGHTS AND APPLICATIONS

 

[Company to Provide Schedule Updated from Existing Deal]

 

 

 

	
  ANNEX L

  	
   

  
	
  TO

  	
   

  
	
  SECURITY AGREEMENT

  	
   

  

 

 

 

 

FORM OF GRANT OF SECURITY

INTEREST IN U.S. PATENTS AND TRADEMARKS

 

FOR GOOD AND VALUABLE CONSIDERATION, receipt and sufficiency of which
are hereby acknowledged,
                                                  ,
a
                        
corporation (“the Assignor”) with principal offices at
                                    ,
hereby grants to Bank of America, N.A., as First-Lien Collateral Agent (the “Assignee”)
with principal offices at Mailcode NC1-001-15-04, 101 North Tryon Street,
Charlotte, NC 28255, a security interest in (i) all of the Assignor’s right,
title and interest in and to the trademarks, trademark registrations and
trademark applications (the “Marks”) set forth on Schedule A attached
hereto; (ii) all of the Assignor’s right, title and interest in and to the
patents and patent applications (the “Patents”) set forth on Schedule B
attached, in each case together with (iii) all Proceeds (as such term is
defined in the Security Agreement referred to below) of the Marks and Patents,
(iv) the goodwill of the businesses with which the Marks are associated and,
(v) all causes of action arising prior to or after the date hereof for
infringement of any of the Marks and Patents or unfair competition regarding
the same.

 

THIS ASSIGNMENT OF SECURITY INTEREST (this “Grant”), effective
as of
                    ,
is made to secure the satisfactory performance and payment of all the
Obligations of the Assignor, as such term is defined in the Security Agreement,
among Assignor, the other assignors from time to time party thereto and the
Assignee, dated as of March 17, 2004 (as amended, restated, modified and/or
supplemented from time to time, the “Security Agreement”).

 

This Assignment has been granted in conjunction with the security
interest granted to the Assignee under the Security Agreement.  The rights and remedies of the Assignee with
respect to the security interest granted herein are without prejudice to, and
are in addition to those set forth in the Security Agreement, all terms and
provisions of which are incorporated herein by reference.  In the event that any provisions of this
Grant are deemed to conflict with the Security Agreement, the provisions of the
Security Agreement shall govern.

 

 

IN WITNESS WHEREOF, the undersigned have executed this
Grant as of the          day of
                        ,
           .

 

 

	
   

  	
   

  	
   

  
	
   

  	
  Assignor,

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BANK OF AMERICA,
  N.A.,

  
	
   

  	
    as First-Lien Collateral Agent, as
  Assignee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  

 

 

	
  STATE OF NEW YORK

  	
  )

  
	
   

  	
  )  ss.:

  
	
  COUNTY OF NEW YORK

  	
  )

  

 

 

On this          day of
          ,
           , before me
personally came                              
who, being by me duly sworn, did state as follows:  that [s]he is
                              
of [Name of Assignor], that [s]he is authorized to execute the foregoing Grant
on behalf of said corporation and that [s]he did so by authority of the Board
of Directors of said corporation.

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary
  Public

  	
   

  

 

 

	
  STATE OF NEW YORK

  	
  )

  
	
   

  	
  )  ss.:

  
	
  COUNTY OF NEW YORK

  	
  )

  

 

On this         day of
          ,
        , before me personally came
                        
who, being by me duly sworn, did state as follows:  that [s]he is
                               
of BANK OF AMERICA, N.A., that [s]he is authorized to execute the foregoing
Grant on behalf of said company and that [s]he did so by authority of said
company.

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary
  Public

  	
   

  

 

 

Schedule A

to Annex L

 

 

U.S. TRADEMARKS OWNED BY
[NAME OF ASSIGNOR]

 

	
  Mark

  	
   

  	
  Reg. No.

  	
   

  	
  Reg. Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

[Each Assignor
to provide]

 

Schedule B

to Annex L

 

 

U.S. PATENTS AND PATENT

APPLICATIONS OWNED BY [NAME OF ASSIGNOR]

 

	
  Patent

  	
   

  	
  Patent No.

  	
   

  	
  Issue Date

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  

 

[Each Assignor
to provide]

 

 

ANNEX M

 

FORM OF GRANT OF

SECURITY INTEREST IN U.S. COPYRIGHTS

 

WHEREAS,
                                   ,
a                                    
corporation (the “Assignor”), having its chief executive office at
                                                      ,
is the owner of all right, title and interest in and to the copyrights and
associated copyright registrations and applications for registration set forth
in Schedule A attached hereto;

 

WHEREAS, BANK OF AMERICA, N.A., as First-Lien Collateral Agent, having
its principal offices at Mailcode NC1-001-15-04, 101 North Tryon Street,
Charlotte, NC 28255 (the “Assignee”), desires to acquire a security
interest in, and lien upon all of the Assignor’s right, title and interest to,
said copyrights and copyright registrations and applications therefor; and

 

WHEREAS, the Assignor is willing to assign and grant to the Assignee a
security interest in and lien upon the copyrights and copyright registrations
and applications therefor described above.

 

NOW, THEREFORE, for good and valuable consideration, the receipt of
which is hereby acknowledged, and subject to the terms and conditions of the
Security Agreement, dated as of March 17, 2004, made by the Assignor, the other
assignors from time to time party thereto and the Assignee (as amended,
restated, modified and/or supplemented from time to time, the “Security
Agreement”), the Assignor hereby assigns to the Assignee, and grants to the
Assignee a security interest in, and lien upon all of the Assignor’s right,
title and interest to, the copyrights and copyright registrations and
applications therefor set forth in Schedule A attached hereto (the “Copyrights”),
together with (i) all Proceeds (as such term is defined in the Security
Agreement) of the Copyrights and (ii) all causes of action arising prior to or
after the date hereof for infringement of any Copyright.

 

THIS ASSIGNMENT OF SECURITY INTEREST (this “Grant”) has been
granted in conjunction with the security interest granted to the Assignee under
the Security Agreement.  The rights and
remedies of the Assignee with respect to the security interest granted herein
are without prejudice to, and are in addition to those set forth in the
Security Agreement, all terms and provisions of which are incorporated herein
by reference.  In the event that any
provisions of this Grant are deemed to conflict with the Security Agreement,
the provisions of the Security Agreement shall govern.

 

 

IN WITNESS WHEREOF, the undersigned have executed this Grant at New
York, New York, as of the         day of
          ,
       .

 

 

	
   

  	
   

  	
  ,

  
	
   

  	
  Assignor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BANK OF AMERICA, N.A.,

  
	
   

  	
    as
  First-Lien Collateral Agent, as Assignee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
					

 

 

	
  STATE OF NEW YORK

  	
  )

  
	
   

  	
  )  ss.:

  
	
  COUNTY OF NEW YORK

  	
  )

  

 

On this           day of
          ,
        , before me personally came
                      
                         ,
who being duly sworn, did depose and say that [s]he is
                                       
of [Name of Assignor], that [s]he is authorized to execute the foregoing Grant
on behalf of said corporation and that [s]he did so by authority of the Board
of Directors of said corporation.

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary
  Public

  	
   

  

 

 

	
  STATE OF NEW YORK

  	
  )

  
	
   

  	
  )  ss.:

  
	
  COUNTY OF NEW YORK

  	
  )

  

 

On this           
day of
              ,
        , before me personally came
                       
                              ,
who being duly sworn, did depose and say that [s]he is
                                                          
of BANK OF AMERICA, N.A., that [s]he is authorized to execute the foregoing
Grant on behalf of said corporation and that [s]he did so by authority of the
Board of Directors of said corporation.

 

	
   

  	
   

  	
   

  
	
   

  	
  Notary
  Public

  	
   

  

 

 

U.S. COPYRIGHTS OWNED BY
[NAME OF ASSIGNOR]

 

	
  Copyright
  Title

  	
   

  	
  Copyright
  Reg. No.

  	
   

  	
  Publication
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[Each Assignor to provide]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00066-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00066-of-00352.parquet"}]]