Common use of Collateral Security Clause in Contracts

Collateral Security. As soon as practical but in any event not later than March 31, 2005, the Company, Quaker Textile Corporation, a Massachusetts corporation ("Quaker Textile"), Quaker Fabric Mexico, S.A. de C.V., a Mexican corporation ("Quaker Mexico"), and Parent shall have granted to the Noteholders a perfected, first priority security interest (subject only to Liens permitted under paragraph 6G of each Note Agreement and entitled to priority under applicable law and the pari passu liens granted (or to be granted) to Fleet) in all personal property assets of the Company, Quaker Textile, Quaker Mexico and the Parent (collectively, the "Grantors"), whether now owned or hereafter acquired, pursuant to the terms of one or more security agreements, patent collateral assignment and security agreements, trademark collateral security and pledge agreements, memorandums of grants of security interest in copyrights, stock pledge agreements (pursuant to which the stock of the Company, Quaker Textile and Quaker Mexico shall be pledged to the Noteholders) and all other instruments and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed or delivered by the Noteholders, all in form and substance satisfactory to the Noteholders (collectively, the "Security Documents"). Notwithstanding the foregoing, no Grantor shall be required to grant a security interest in any of its personal property aassets located outside of the United States (collectively, the "Excluded Assets"), provided that each of the Grantors hereby agrees that no such Person shall enter into any agreement, instrument or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all or any portion of the Excluded Assets. In connection with the execution and delivery of the Security Documents, the Grantors shall (i) execute and deliver to the Noteholders, and facilitate the execution and delivery by Fleet of, an intercreditor agreement, in form and substance satisfactory to the Noteholders in their sole and absolute discretion, among the Noteholders, Fleet, and the Grantors, and (ii) deliver to the Noteholders a favorable legal opinion, in form and substance satisfactory to the Noteholders, from counsel to the Grantors concerning corporate authority matters, perfection of the security interests granted pursuant to the Security Documents, the enforceability of the Security Documents and the transactions contemplated thereby and concerning such other matters as the Noteholders may request. Subject to the execution by Grantors of the Security Documents in accordance with the first sentence of this paragraph and the satisfaction of the conditions set forth in the preceding sentence, notwithstanding any provision of the Note Agreements to the contrary, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended and Restated Credit Agreement, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended or modified to date, the "Credit Agreement"). Each of the Parent and the Company hereby acknowledges and agrees that the occurrence of any event of default under any of the Security Documents shall constitute an Event of Default under this Agreement and the Note Agreements.

Collateral Security. As soon as practical but in any event not later than March 31(a) The indebtedness, 2005liabilities and obligations of Borrowers under this Section 2A, the Company, Quaker Textile Corporation, a Massachusetts corporation ("Quaker Textile"), Quaker Fabric Mexico, S.A. de C.V., a Mexican corporation ("Quaker Mexico"), and Parent shall have granted to the Noteholders a perfected, first priority security interest (subject only to Liens permitted under paragraph 6G of each Note Agreement and entitled to priority under applicable law and the pari passu liens granted (however created or to be granted) to Fleet) in all personal property assets of the Company, Quaker Textile, Quaker Mexico and the Parent (collectively, the "Grantors")incurred, whether now owned existing or hereafter acquiredarising, pursuant due or to become due, absolute or contingent, direct or indirect, secured or unsecured, are among the obligations secured by the security interests, liens and encumbrances created by the Collateral, and Bank is entitled to the terms of one or more security agreements, patent collateral assignment and security agreements, trademark collateral security and pledge agreements, memorandums of grants of security interest in copyrights, stock pledge agreements (pursuant to which the stock benefit of the Company, Quaker Textile and Quaker Mexico shall be pledged Collateral granted thereunder with respect to such indebtedness. (b) Notwithstanding the Noteholders) and all other instruments and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed or delivered by payment in full of the Noteholders, all in form and substance satisfactory to the Noteholders (collectivelyLoan, the "Security Documents"). Notwithstanding the foregoing, no Grantor shall be required to grant a security interest in any of its personal property aassets located outside termination of the United States (collectively, the "Excluded Assets"), provided that each of the Grantors hereby agrees that no such Person shall enter into any agreement, instrument Commitment or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all or any portion of the Excluded Assets. In connection with the execution and delivery of the Security Documents, the Grantors shall (i) execute and deliver to the Noteholders, and facilitate the execution and delivery by Fleet of, an intercreditor agreement, in form and substance satisfactory to the Noteholders in their sole and absolute discretion, among the Noteholders, Fleet, and the Grantors, and (ii) deliver to the Noteholders a favorable legal opinion, in form and substance satisfactory to the Noteholders, from counsel to the Grantors concerning corporate authority matters, perfection of the security interests granted pursuant to the Security Documents, the enforceability of the Security Documents and the transactions contemplated thereby and concerning such other matters as the Noteholders may request. Subject to the execution by Grantors of the Security Documents in accordance with the first sentence of this paragraph and the satisfaction of the conditions set forth in the preceding sentence, notwithstanding any provision of the Note Agreements to the contrary, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended and Restated Credit Agreement, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended or modified to date, the "Credit Agreement"). Each of the Parent and the Company hereby acknowledges and agrees that the occurrence of any event the Termination Date, the Collateral shall continue to secure the Indebtedness, liabilities and obligations of default Borrowers under any this Section 2A until all Letters of Credit shall have expired and all Indebtedness, liabilities and obligations under this Section 2A shall have been paid in full or until the cash collateral required by subparagraph (c) below has been provided. (c) On the termination of the Security Documents shall constitute Commitment or the occurrence of an Event of Default, Bank may require (and in the case of an Event of Default occurring under this Agreement Paragraph 8.1(i) it shall be required automatically) that Borrowers deliver to Bank cash or U.S. Treasury Bills with maturities of not more than 90 days from the date of delivery (discounted in accordance with customary banking practice to present value to determine amount) in an amount equal at all times to one hundred ten percent (110%) of the outstanding undrawn amount of all Letters of Credit, such cash or U.S. Treasury Bills and all interest earned thereon to constitute cash collateral for all such Letters of Credit. At such time as such Collateral is required to be and has not been deposited, Bank shall be entitled to liquidate such of the other Collateral for the Loan (if any) as is necessary or appropriate in its sole judgment so as to create such cash collateral. (d) Any cash collateral deposited under subparagraph (c) above, and all interest earned thereon, shall be held by Bank and invested and reinvested at the expense and the Note Agreementswritten direction of Borrowers, in U.S. Treasury Bills with maturities of no more than ninety (90) days from the date of investment.

Collateral Security. As soon (a) Except for the Liens granted to Lender pursuant to this Agreement and Liens referred to in Section 3.11, Borrower owns and will own each item which it pledges on the date hereof or may hereinafter pledge as practical but Collateral, free and clear of any and all Liens. No security agreement, financing statement or other public notice similar in effect with respect to all or any part of the Collateral is or will be on file or of record in any event not later than March 31public office, 2005except such as have been or may hereinafter be filed in favor of Lender pursuant to this Agreement, and except in connection with the security interest referred to in Section 3.11. (b) This Agreement is effective to create, as collateral security for the Obligations and the Other RF Obligations, valid and enforceable Liens on the Collateral in favor of Lender. (c) Upon filing of the financing statement(s) delivered to Lender by Borrower on the Closing Date with the Secretary of State of the State of New Jersey (which financing statement(s) is in proper form for filing in such jurisdiction) and the delivery to, and continuing possession by, Lender or its nominee of the Pledged Securities, the Company, Quaker Textile Corporation, Liens created pursuant to this Agreement will constitute a Massachusetts corporation ("Quaker Textile"), Quaker Fabric Mexico, S.A. de C.V., a Mexican corporation ("Quaker Mexico"), and Parent shall have granted to the Noteholders a perfected, first priority security interest (subject only to Liens permitted under paragraph 6G of each Note Agreement and entitled to priority under applicable law and the pari passu liens granted (or to be granted) to Fleet) in all personal property assets of the Company, Quaker Textile, Quaker Mexico and the Parent (collectively, the "Grantors"), whether now owned or hereafter acquired, pursuant to the terms of one or more security agreements, patent collateral assignment and security agreements, trademark collateral security and pledge agreements, memorandums of grants of perfected security interest in copyrights, stock pledge agreements the Collateral in favor of Lender (pursuant to which the stock of the Company, Quaker Textile and Quaker Mexico shall be pledged except to the Noteholders) and extent the Collateral may be deemed to represent funds on deposit in the Spread Account as referred to in Section 3.11), which Liens will be prior to all other instruments Liens of all other Persons and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed or delivered by the Noteholders, which Liens are enforceable as such as against all in form and substance satisfactory to the Noteholders (collectively, the "Security Documents"). Notwithstanding the foregoing, no Grantor shall be required to grant a security interest in any of its personal property aassets located outside of the United States (collectively, the "Excluded Assets"), provided that each of the Grantors hereby agrees that no such Person shall enter into any agreement, instrument or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all or any portion of the Excluded Assets. In connection with the execution and delivery of the Security Documents, the Grantors shall (i) execute and deliver to the Noteholders, and facilitate the execution and delivery by Fleet of, an intercreditor agreement, in form and substance satisfactory to the Noteholders in their sole and absolute discretion, among the Noteholders, Fleet, and the Grantors, and (ii) deliver to the Noteholders a favorable legal opinion, in form and substance satisfactory to the Noteholders, from counsel to the Grantors concerning corporate authority matters, perfection of the security interests granted pursuant to the Security Documents, the enforceability of the Security Documents and the transactions contemplated thereby and concerning such other matters as the Noteholders may request. Subject to the execution by Grantors of the Security Documents in accordance with the first sentence of this paragraph and the satisfaction of the conditions set forth in the preceding sentence, notwithstanding any provision of the Note Agreements to the contrary, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended and Restated Credit Agreement, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended or modified to date, the "Credit Agreement"). Each of the Parent and the Company hereby acknowledges and agrees that the occurrence of any event of default under any of the Security Documents shall constitute an Event of Default under this Agreement and the Note AgreementsPersons.

Collateral Security. As soon as practical but in any event not later than March 31, 2005, (a) Each of the Company, Quaker Textile Corporation, a Massachusetts corporation ("Quaker Textile"), Quaker Fabric Mexico, S.A. de C.V., a Mexican corporation ("Quaker Mexico")Lenders and the LC Bank hereby irrevocably authorize the Administrative Agent to execute and deliver, and Parent shall have granted to the Noteholders a perfected, first priority security interest (subject only to Liens permitted under paragraph 6G of each Note Agreement and entitled to priority under applicable law and the pari passu liens granted (or to be granted) to Fleet) in all personal property assets of the Company, Quaker Textile, Quaker Mexico and the Parent (collectively, the "Grantors"), whether now owned or hereafter acquired, pursuant to the terms of one or more security agreements, patent collateral assignment and security agreements, trademark collateral security and pledge agreements, memorandums of grants of security interest in copyrights, stock pledge agreements (pursuant to which the stock of the Company, Quaker Textile and Quaker Mexico shall be pledged to the Noteholders) and all other instruments and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed or delivered by the Noteholders, all in form and substance satisfactory to the Noteholders (collectively, the "Security Documents"). Notwithstanding the foregoing, no Grantor shall be required to grant a security interest in any of its personal property aassets located outside of the United States (collectively, the "Excluded Assets"), provided that each of the Grantors hereby agrees that no such Person shall otherwise enter into any agreementor accept, instrument or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all or any portion of the Excluded Assets. In connection with the execution and delivery of the Security Documents, the Grantors shall (i) execute and deliver to the Noteholders, and facilitate the execution and delivery by Fleet of, an intercreditor agreement, in form and substance satisfactory to the Noteholders in their sole and absolute discretion, among the Noteholders, Fleet, and the Grantors, and (ii) deliver to the Noteholders a favorable legal opinion, in form and substance satisfactory to the Noteholders, from counsel to the Grantors concerning corporate authority matters, perfection of the security interests granted pursuant to the Security Documents, the enforceability each of the Security Documents and necessary or (in the transactions contemplated thereby and concerning such other matters as the Noteholders may request. Subject to the execution by Grantors opinion of the Security Documents Administrative Agent) reasonably necessary to effect the requirements of Section 6.22. (b) Except as otherwise provided in accordance Section 9.02(b) with respect to this Agreement, the Administrative Agent may, with the first sentence of this paragraph and the satisfaction prior consent of the conditions set forth in the preceding sentenceRequired Lenders (but not otherwise), notwithstanding any provision of the Note Agreements to the contrary, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended and Restated Credit Agreementany modification, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended supplement or modified to date, the "Credit Agreement"). Each of the Parent and the Company hereby acknowledges and agrees that the occurrence of any event of default waiver under any of the Credit Documents, including agreeing to additional obligations (including obligations held by Persons other than Lenders and the Administrative Agent) being secured by any Collateral; provided that, without the prior consent of each Lender, the Administrative Agent shall not (except as provided herein or in the Security Documents) release any substantial part of the Collateral or otherwise terminate any substantial part of the Liens under any Security Document (whether by release of property or Obligor) or alter the relative priorities of the obligations entitled to the benefits of the Liens created under the Security Documents; provided further that no such consent of any Lender shall be required, and the Administrative Agent is hereby authorized, to release any Lien covering Collateral (and to release any such guarantor) (i) that is the subject of a disposition of property permitted hereunder or under any of the other Credit Documents pursuant to Section 6.22(b) or (ii) that is the property of a Subsidiary that has been designated an Unrestricted Entity in accordance with Section 6.16(e). (c) The Lenders and the LC Bank hereby agree, solely for the benefit of the Administrative Agent, that the Administrative Agent may terminate any and all Liens created by the Security Documents at and after the time that (i) all of the Loans shall constitute have become due (whether at stated maturity, upon acceleration or otherwise), (ii) such Loans and all interest thereon, and all fees payable hereunder, shall have been paid in full in cash, (iii) all Commitments of the Lenders shall have terminated and (iv) all Letters of Credit shall have expired or have been cancelled, unless prior to such time any Lender or the LC Bank shall have delivered to the Administrative Agent a written notice that such Lender or LC Bank holds a Secured Obligation under a Hedge Agreement, cash management arrangement or foreign exchange contract, a Guarantee thereof or a claim for an Event indemnity or expense hereunder, and such Lender or the LC Bank shall not have (A) delivered to the Administrative Agent a subsequent written notice that such Secured Obligation shall have been satisfied or discharged or (B) consented to the termination of Default under this Agreement and the Note Agreementssuch Liens.

Collateral Security. As soon as practical but in any event not later than March 31(a) The indebtedness, 2005, the Company, Quaker Textile Corporation, a Massachusetts corporation ("Quaker Textile"), Quaker Fabric Mexico, S.A. de C.V., a Mexican corporation ("Quaker Mexico"), liabilities and Parent shall have granted to the Noteholders a perfected, first priority security interest (subject only to Liens permitted under paragraph 6G of each Note Agreement and entitled to priority under applicable law and the pari passu liens granted (or to be granted) to Fleet) in all personal property assets obligations of the CompanyBorrower under this Section 2A, Quaker Textile, Quaker Mexico and the Parent (collectively, the "Grantors")however created or incurred, whether now owned existing or hereafter acquiredarising, pursuant due or to become due, absolute or contingent, direct or indirect, secured or unsecured, are among the obligations secured by the security interests, liens and encumbrances created by the Collateral Security Documents delivered to Administrative Agent and Administrative Agent and the Banks are entitled to the terms benefit of one or more security agreements, patent collateral assignment and security agreements, trademark the collateral security and pledge agreements, memorandums of grants of security interest granted thereunder with respect to such indebtedness. (b) Notwithstanding the payment in copyrights, stock pledge agreements (pursuant to which the stock full of the Company, Quaker Textile and Quaker Mexico shall be pledged to the Noteholders) and all other instruments and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed or delivered by the Noteholders, all in form and substance satisfactory to the Noteholders (collectivelyLoan, the "Security Documents"). Notwithstanding the foregoing, no Grantor shall be required to grant a security interest in any of its personal property aassets located outside termination of the United States (collectively, the "Excluded Assets"), provided that each of the Grantors hereby agrees that no such Person shall enter into any agreement, instrument Commitment or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all or any portion of the Excluded Assets. In connection with the execution and delivery of the Security Documents, the Grantors shall (i) execute and deliver to the Noteholders, and facilitate the execution and delivery by Fleet of, an intercreditor agreement, in form and substance satisfactory to the Noteholders in their sole and absolute discretion, among the Noteholders, Fleet, and the Grantors, and (ii) deliver to the Noteholders a favorable legal opinion, in form and substance satisfactory to the Noteholders, from counsel to the Grantors concerning corporate authority matters, perfection of the security interests granted pursuant to the Security Documents, the enforceability of the Security Documents and the transactions contemplated thereby and concerning such other matters as the Noteholders may request. Subject to the execution by Grantors of the Security Documents in accordance with the first sentence of this paragraph and the satisfaction of the conditions set forth in the preceding sentence, notwithstanding any provision of the Note Agreements to the contrary, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended and Restated Credit Agreement, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended or modified to date, the "Credit Agreement"). Each of the Parent and the Company hereby acknowledges and agrees that the occurrence of any event of default under any the Final Maturity Date, the Collateral shall continue to secure the indebtedness, liabilities and obligations of the Security Documents Borrower under this Section 2A until all Letters of Credit shall constitute have expired and all indebtedness, liabilities and obligations under this Section 2A shall have been paid in full. (c) On the termination of the Commitment, the Final Maturity Date and the occurrence of an Event of Default, Required Banks may require (and in the case of an Event of Default occurring under this Agreement Paragraph 9.1(k) it shall be required automatically) that the Borrower deliver to Administrative Agent, cash or U.S. Treasury Bills with maturities of not more than 90 days from the date of delivery (discounted in accordance with customary banking practice to present value to determine amount) in an amount equal at all times to one hundred ten percent (110%) of the outstanding undrawn amount of all Letters of Credit, such cash or U.S. Treasury Bills and all interest earned thereon to constitute cash collateral for all such Letters of Credit. At such time as such collateral is required to be and has not been deposited, Administrative Agent on behalf of Banks shall be entitled to liquidate such of the other collateral for the Loan (if any) as is necessary or appropriate in its sole judgment so as to create such cash collateral. (d) Any cash collateral deposited under subparagraph (c) above, and all interest earned thereon, shall be held by Administrative Agent and invested and reinvested at the expense and the Note Agreementswritten direction of the Borrower, in U.S. Treasury Bills with maturities of no more than ninety (90) days from the date of investment.

Collateral Security. As soon Except as practical but set forth in any event not later than March 31Schedule 6.14, 2005, cause the Company, Quaker Textile Corporation, Obligations to be secured by (a) a Massachusetts corporation perfected ("Quaker Textile"), Quaker Fabric Mexico, S.A. de C.V., a Mexican corporation ("Quaker Mexico"), except in Motor Vehicles and Parent shall have granted to Real Estate on the Noteholders a perfected, first Closing 8884322.11 Date) first-priority security interest (subject only to Permitted Liens permitted under paragraph 6G of each Note Agreement and entitled to priority under applicable law and the pari passu liens granted (or to be granted) to FleetLaw) in all personal property assets of the Companypresent and future property and assets, Quaker Textilereal and personal, Quaker Mexico of each of the Loan Parties, including, but not limited to, machinery and the Parent (collectivelyequipment, the "Grantors")inventory and other goods, accounts receivable, owned real estate, leaseholds, fixtures, bank accounts, general intangibles, financial assets, investment property, license rights, patents, trademarks, tradenames, copyrights, chattel paper, insurance proceeds, contract rights, hedge agreements, documents, instruments, indemnification rights, tax refunds and cash of each Loan Party, whether now owned or hereafter acquired, pursuant to the terms of the Security Agreement (including all present and future intercompany debt of each of the Loan Parties and excluding fixed or capital assets subject to a purchase money financing or Capitalized Lease permitted under Section 7.03(e) (so long as such financing or lease remains in effect) to the extent that the terms of such financing expressly prohibits such security interest); and (b) a pledge of one hundred (100%) of all present and future capital stock or more other Equity Interests of the Loan Parties (other than the Borrower) and their present and future Subsidiaries to the Administrative Agent, for the benefit of the Secured Parties pursuant to the Securities Pledge Agreement; provided that each of the Loan Parties hereby agrees, upon the request of the Administrative Agent, to deliver, as promptly as practicable, but in any event within sixty (60) days after request therefor, or such other later time, if any, to which the Administrative Agent may agree, (i) certificates of titles for all Motor Vehicles owned by the Loan Parties with the Administrative Agent listed as lienholder therein and, if required by the Administrative Agent, the Loan Parties shall have retained Corporation Service Company (or other similar company satisfactory to the Administrative Agent) pursuant to agreements reasonably satisfactory to the Administrative Agent pursuant to which Corporation Service Company (or such other company) will agree to act as agent for the Secured Parties with respect to the perfection of security agreementsinterests in the Motor Vehicles owned by the Loan Parties; and (ii) mortgages with respect to Real Estate and to take such other steps and make such other deliveries as may be reasonably requested by the Administrative Agent (including, patent collateral assignment without limitation, the delivery of legal opinions, consulting engineer’s reports, environmental site assessment reports, other environmental reports, surveys, landlord consents, flood insurance determination and security agreementsany necessary flood insurance, trademark collateral security and pledge agreementstitle insurance) so as to provide the Administrative Agent, memorandums for the benefit of grants of the Secured Parties, a perfected first-priority security interest in copyrightssuch assets, stock pledge agreements provided that to the extent that any lease of (pursuant to which or operating/management agreement with respect to) Real Estate prohibits assignment of such lease (or operating/management agreement) without the stock consent of the Company, Quaker Textile and Quaker Mexico shall be pledged to the Noteholders) and all other instruments and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed lessor or delivered by the Noteholders, all in form and substance satisfactory to the Noteholders (collectivelyanother party thereunder, the "Security Documents"). Notwithstanding the foregoing, no Grantor Loan Parties shall not be required to grant a security mortgage on the leasehold interest under such lease, but in any of its personal property aassets located outside of the United States (collectivelysuch event, the "Excluded Assets"), provided that each of Loan Parties agree to diligently and in good faith use its reasonable best efforts to obtain the Grantors hereby agrees that no such Person consent (which consent shall enter into any agreement, instrument or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all or any portion of the Excluded Assets. In connection with the execution and delivery of the Security Documents, the Grantors shall (i) execute and deliver to the Noteholders, and facilitate the execution and delivery by Fleet of, an intercreditor agreement, be in form and substance reasonably satisfactory to the Noteholders Administrative Agent) of the applicable lessor or other party to such leasehold mortgage (and, upon the receipt of such consent, the Loan Parties shall promptly grant such leasehold mortgage and comply with the other provisions of this Section 6.15 with respect thereto). Notwithstanding the foregoing or the provisions of Section 6.14(a), unless otherwise requested by the Administrative Agent or the Required Lenders at any time in their sole and absolute discretion, among Heritage Limited and any other Foreign Subsidiary, if any, shall not be required to provide the NoteholdersAdministrative Agent with a perfected, Fleet, first-priority security interest in its properties and assets so long as the Grantors, book value of such properties and (ii) deliver to the Noteholders a favorable legal opinionassets, in form the aggregate for all Foreign Subsidiaries, is less than $3,000,000, provided that Heritage Limited and substance satisfactory to the Noteholders, from counsel to the Grantors concerning corporate authority matters, perfection of the security interests granted pursuant to the Security Documents, the enforceability of the Security Documents and the transactions contemplated thereby and concerning such each other matters as the Noteholders may request. Subject to the execution by Grantors of the Security Documents in accordance with the first sentence of this paragraph and the satisfaction of the conditions set forth in the preceding sentence, notwithstanding any provision of the Note Agreements to the contrary, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended and Restated Credit Agreement, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended or modified to date, the "Credit Agreement"). Each of the Parent and the Company hereby acknowledges and agrees that the occurrence of any event of default under any of the Security Documents Foreign Subsidiary shall constitute an Event of Default under this Agreement and the Note Agreements.guaranty the

Collateral Security. As soon as practical but in any event not later than March 31(a) The indebtedness, 2005liabilities and obligations of Borrower under this Section 2A, the Company, Quaker Textile Corporation, a Massachusetts corporation ("Quaker Textile"), Quaker Fabric Mexico, S.A. de C.V., a Mexican corporation ("Quaker Mexico"), and Parent shall have granted to the Noteholders a perfected, first priority security interest (subject only to Liens permitted under paragraph 6G of each Note Agreement and entitled to priority under applicable law and the pari passu liens granted (however created or to be granted) to Fleet) in all personal property assets of the Company, Quaker Textile, Quaker Mexico and the Parent (collectively, the "Grantors")incurred, whether now owned existing or hereafter acquiredarising, pursuant due or to become due, absolute or contingent, direct or indirect, secured or unsecured, are among the obligations secured by the security interests, liens and encumbrances created by the Collateral, and Agent and the Banks are entitled to the terms of one or more security agreements, patent collateral assignment and security agreements, trademark collateral security and pledge agreements, memorandums of grants of security interest in copyrights, stock pledge agreements (pursuant to which the stock benefit of the Company, Quaker Textile and Quaker Mexico shall be pledged Collateral granted thereunder with respect to such indebtedness. (b) Notwithstanding the Noteholders) and all other instruments and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed or delivered by payment in full of the Noteholders, all in form and substance satisfactory to the Noteholders (collectivelyLoan, the "Security Documents"). Notwithstanding the foregoing, no Grantor shall be required to grant a security interest in any of its personal property aassets located outside termination of the United States (collectively, the "Excluded Assets"), provided that each of the Grantors hereby agrees that no such Person shall enter into any agreement, instrument Commitments or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all or any portion of the Excluded Assets. In connection with the execution and delivery of the Security Documents, the Grantors shall (i) execute and deliver to the Noteholders, and facilitate the execution and delivery by Fleet of, an intercreditor agreement, in form and substance satisfactory to the Noteholders in their sole and absolute discretion, among the Noteholders, Fleet, and the Grantors, and (ii) deliver to the Noteholders a favorable legal opinion, in form and substance satisfactory to the Noteholders, from counsel to the Grantors concerning corporate authority matters, perfection of the security interests granted pursuant to the Security Documents, the enforceability of the Security Documents and the transactions contemplated thereby and concerning such other matters as the Noteholders may request. Subject to the execution by Grantors of the Security Documents in accordance with the first sentence of this paragraph and the satisfaction of the conditions set forth in the preceding sentence, notwithstanding any provision of the Note Agreements to the contrary, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended and Restated Credit Agreement, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended or modified to date, the "Credit Agreement"). Each of the Parent and the Company hereby acknowledges and agrees that the occurrence of any event the Termination Date, the Collateral shall continue to secure the indebtedness, liabilities and obligations of default Borrower under any this Section 2A until all Letters of Credit shall have expired and all indebtedness, liabilities and obligations under this Section 2A shall have been paid in full. (c) On the termination of the Security Documents shall constitute Revolving Commitment or the occurrence of an Event of Default, Required Banks may require (and in the case of an Event of Default occurring under this Agreement Paragraph 8.1(i) it shall be required automatically) that Borrower deliver to Agent cash or U.S. Treasury Bills with maturities of not more than 90 days from the date of delivery (discounted in accordance with customary banking practice to present value to determine amount) in an amount equal at all times to one hundred ten percent (110%) of the outstanding undrawn amount of all Letters of Credit, such cash or U.S. Treasury Bills and all interest earned thereon to constitute cash collateral for all such Letters of Credit. At such time as such collateral is required to be and has not been deposited, Agent on behalf of Banks shall be entitled to liquidate such of the other collateral for the Loan (if any) as is necessary or appropriate in its sole judgment so as to create such cash collateral. (d) Any cash collateral deposited under subparagraph (c) above, and all interest earned thereon, shall be held by Agent and invested and reinvested at the expense and the Note Agreementswritten direction of Borrower, in U.S. Treasury Bills with maturities of no more than ninety (90) days from the date of investment.

Collateral Security. As soon as practical but (a) Each of the Obligors will, subject to each of the other lettered paragraphs of this Section, on the Effective Date and continuously thereafter at their expense, (i) create and maintain a valid and enforceable first-priority Lien, free and clear of all other Liens, in and to all of the Mortgaged Properties, and on the fixtures and personal property (tangible and intangible) of the Obligors existing on the Effective Date and thereafter arising and/or acquired, including intellectual property, accounts, general intangibles, goods (including inventory and equipment), claims against ISP Funding and securities (including the capital stock that any Obligor holds, directly or indirectly, in any event not later than March 31of the Subsidiaries of Chemco, 2005, the Company, Quaker Textile Corporation, a Massachusetts corporation ("Quaker Textile"including ISP Funding), Quaker Fabric Mexico, S.A. de C.V., a Mexican corporation ("Quaker Mexico"), and Parent shall have granted to the Noteholders a perfected, first priority security interest (subject only to Liens permitted under paragraph 6G of each Note ii) perfect Credit Agreement and entitled to priority such Lien under applicable law through the execution and the pari passu liens granted (or to be granted) to Fleet) in all personal property assets of the Company, Quaker Textile, Quaker Mexico and the Parent (collectively, the "Grantors"), whether now owned or hereafter acquired, pursuant to the terms of one or more security agreements, patent collateral assignment and security agreements, trademark collateral security and pledge agreements, memorandums of grants of security interest in copyrights, stock pledge agreements (pursuant to which the stock of the Company, Quaker Textile and Quaker Mexico shall be pledged to the Noteholders) and all other instruments and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed or delivered delivery by the Noteholders, Obligors of all necessary and reasonably desirable Security Documents (in form and substance satisfactory to the Noteholders Administrative Agent) and (collectivelyiii) file, record and register, as applicable, such Security Documents with all necessary and (and in the "Security Documents"). Notwithstanding the foregoing, no Grantor shall be required to grant a security interest in any of its personal property aassets located outside opinion of the United States Administrative Agent) reasonably desirable offices, except: (collectively, i) to the "Excluded Assets"), provided extent of Permitted Liens on the Collateral; (ii) to the extent that each the Administrative Agent shall determine in its sole discretion that the costs of the Grantors hereby agrees that no creating such Person shall enter into any agreement, instrument or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all any such property (or perfecting any portion Lien created in its favor therein or clearing any such adverse claim) are excessive in relation to the value of the Excluded Assets. collateral security to be afforded thereby; (iii) to the extent that any Intellectual Property (as such term is defined in the Pledge and Security Agreement) would be rendered invalid, abandoned, void or unenforceable by reason of its being included as part of the Collateral or is subject to a provision that restricts the assignment thereof that is enforceable under applicable law and the applicable Obligor is unable after using its best efforts (as determined by the Administrative Agent in its sole discretion) to obtain a waiver of such provision by the beneficiary thereof; (iv) the Belleville Property and (except to the extent provided in Section 6.13(a)) the Linden Property; (v) accounts receivable originated by any Obligor in connection with the sale or lease of inventory or the rendering of services in the ordinary course of business which are subject to sale to ISP Funding in connection with a Qualified Securitization Program and the proceeds thereof; and (vi) 34% of the shares of each class of capital stock of any Foreign Subsidiary held by an Obligor, directly or (other than through another Foreign Subsidiary) indirectly and 100% of the shares of capital stock of any Foreign Subsidiary held by an Obligor indirectly through another Foreign Subsidiary. (i) In connection with the execution and delivery each Disposition permitted hereunder or under any of the Security other Credit Documents, upon the Grantors request of the Lead Borrower, the Administrative Agent shall promptly (iA) release its Lien on such property, without any recourse or warranty or representation whatsoever, (B) deliver to the Lead Borrower any documentary Collateral that is the subject of such Disposition and (C) execute and deliver to the NoteholdersLead Borrower such Uniform Commercial Code release statements, mortgage releases and other instruments and documents as may be prepared by the Lead Borrower or the other Obligors that are reasonably required to effect the release of the Liens on the Collateral that is the subject of such Disposition, provided that at the time of such Disposition and the release of the Lien by the Administrative Agent, the Administrative Agent shall have obtained, through the efforts and at the expense of the Obligors, (y) a first-priority perfected security interest in the proceeds of such released Collateral and (z) in the reasonable discretion of the Administrative Agent, legal opinions (from counsel acceptable to it) addressed to the Lenders, the LC Bank and the Administrative Agent, Credit Agreement covering such matters relating to the Lien of the Administrative Agent in such proceeds as it may reasonably request. (ii) In connection with the designation of an Unrestricted Entity in accordance with Section 6.16(e), the Administrative Agent shall promptly (A) release its Lien on all property of such Unrestricted Entity, without any recourse or warranty or representation whatsoever, (B) deliver to the Lead Borrower any documentary Collateral of such Unrestricted Entity and (C) execute and deliver to the Lead Borrower such Uniform Commercial Code release statements, mortgage releases and other instruments and documents as may be prepared by the Lead Borrower or such Unrestricted Entity that are reasonably required to effect the release of the Liens on the Collateral of such Unrestricted Entity. (c) The Obligors shall cause to be delivered to the Administrative Agent not later than 90 days (or such shorter period as specifically set forth below) after the Effective Date (all of which shall be in form, scope and substance reasonably satisfactory to the Administrative Agent): (i) with respect to the Closing Date Mortgaged Properties, one or more policies of title insurance issued by the Title Company, in ALTA, extended coverage, Lender's Fee Policy form 1970 (revised 10/17/84) or such other form approved by the Administrative Agent, or a binding marked commitment to issue such policy or policies, insuring the Administrative Agent for the benefit of itself, the LC Bank and the Lenders, in the amounts set forth on Schedule VII for the Closing Date Mortgaged Properties, insuring that the relevant Obligor is lawfully seized and possessed of a fee simple interest in the Closing Date Mortgaged Properties, and facilitate also insuring the execution validity and delivery priority of the Liens created under the real property Security Documents with respect thereto, subject only to Permitted Liens; each such title policy shall contain: (A) full coverage against mechanics' liens (filed and inchoate), (B) a reference to the relevant survey with no survey exceptions except those theretofore approved by Fleet ofthe Administrative Agent and (C) such affirmative insurance and endorsements as the Administrative Agent may reasonably require; and each such title policy shall be accompanied by such reinsurance agreements between the Title Company and such other title companies that shall have been approved by the Administrative Agent, in ALTA Facultative Reinsurance Agreement 9/24/94 form or, in relation to any real property located in Texas, its equivalent, in each case, as the Administrative Agent may require; (ii) as-built metes and bounds surveys of recent date of each facility comprising a Closing Date Mortgaged Property, including easements that benefit such facility, to be covered by the real property Security Documents, showing such matters as may be required by the Administrative Agent, which surveys shall be made in accordance with the "Minimum Standard Detail Requirements for ALTA/ACSM Land Title Surveys" jointly established and adopted by ALTA, ACSM and NSPS in 1999 with all measurements made in accordance with the "Minimum Angle, Distance and Closure Requirements for Survey Measurements Which Control Land Boundaries for ALTA/ACSM Land Title Surveys" or such other form and content that have been approved by the Administrative Agent and which contain "Optional Survey Responsibilities and Specifications" 1, 2, 3, 6, 7(a), 7(b), 7(c), 8, 9, 10, 11(b), 13, 14, 15 and 16 as specified on Table A to the "Minimum Standard Detail Requirements for Credit Agreement ALTA/ACSM Land Title Surveys" and certified to the Administrative Agent, the LC Bank and the Lenders and the Title Company, such certificate to be in a form reasonably acceptable to the Administrative Agent, and shall have been prepared by a registered surveyor acceptable to the Administrative Agent; (iii) certified copies of permanent and unconditional certificates of occupancy (or, if it is not the practice to issue certificates of occupancy in a jurisdiction in which any Mortgaged Property is located, then such other evidence reasonably satisfactory to the Administrative Agent) permitting the fully functioning operation and occupancy of each Mortgaged Property and of such other permits necessary for the use and operation of each such facility issued by the respective Governmental Authorities having jurisdiction over each such facility, provided that to the extent that the Obligors are unable, after using commercially reasonable efforts during the 90-day period following the Effective Date, to deliver such items to the Administrative Agent within such period, such items not delivered by the end of such period shall not be required to be delivered pursuant to this clause (iii); (iv) evidence that the Borrowers shall have paid to the Title Company all expenses and premiums of the Title Company in connection with the issuance of such policies with respect to the Closing Date Mortgaged Properties and in addition shall have paid to the Title Company an intercreditor agreementamount equal to the recording and stamp taxes payable in connection with recording the applicable real property Security Documents in the appropriate county land office(s); and (v) such Security Documents, or amendments or supplements to such Security Documents, relating to the Closing Date Mortgaged Properties as the Administrative Agent shall request, duly executed and delivered by each Obligor and other Person intended to be a party thereto, in each case in form and substance satisfactory to special New York counsel to the Noteholders Administrative Agent (including in their sole and absolute discretionform necessary or desirable to file, among record or register, as applicable), together with such favorable written opinions (addressed to the NoteholdersAdministrative Agent, Fleet, the LC Bank and the Grantors, and Lenders) of such counsel (ii) deliver reasonably acceptable to the Noteholders Administrative Agent) to the applicable Obligors for each jurisdiction the law of which governs the creation, perfection and priority of each Lien provided for by the Security Documents (or amendments or supplements thereto) required to be delivered by this clause (v), in each case covering such matters relating to the Obligors, the Security Documents and the Liens provided for by the Security Documents as shall be reasonably requested by the Administrative Agent, the LC Bank, the Lenders and special New York counsel to the Administrative Agent (and each Obligor hereby instructs such counsel to deliver such opinion to the Administrative Agent, the LC Bank and the Lenders). (vi) the documents listed below for each Post-closing Mortgaged Property: (A) any consents or other documents that are required as a favorable legal opinioncondition in order to create and maintain a valid and enforceable Lien on such property, provided that to the extent that the Obligors are unable, after using commercially reasonable efforts during the 90-day period following the Effective Date, to obtain such consents and other documents within such period with respect to any Post- Credit Agreement closing Mortgaged Property, then such property shall no longer be a Post-closing Mortgaged Property; (B) within 15 days of the date (each, a "Consent Date") that all consents and other documents, if any, required by clause (A) above have been obtained with respect to such Post-closing Mortgaged Property (it being understood and agreed that the Consent Date for any such property shall be the Effective Date if no such consents or documents are required), such Security Documents as the Administrative Agent shall request with respect to such Post-closing Mortgaged Property, duly executed and delivered by each Obligor and other Person intended to be a party thereto, in each case in form and substance satisfactory to the Noteholders, from special New York counsel to the Grantors concerning corporate authority mattersAdministrative Agent (including in form necessary or desirable to file, record or register, as applicable), provided that any leasehold Security Document shall not limit the Obligor's right to terminate such leasehold interest upon reasonable prior notice to the Administrative Agent; (C) within 90 days of the applicable Consent Date, a policy of title insurance issued by the Title Company, in the same form, scope and substance as described in Section 6.22(c)(i) with respect to such Post-closing Mortgaged Property, in an amount equal to at least 110% of the fair market value of such property as certified by the Lead Borrower to the Administrative Agent, together with evidence that the Borrowers shall have paid to the Title Company all expenses and premiums of the Title Company in connection with the issuance of such policy and in addition shall have paid to the Title Company an amount equal to the recording and stamp taxes payable in connection with recording the applicable real property Security Documents in the appropriate county land office(s); and (D) within 90 days of the applicable Consent Date, an as-built metes and bounds survey of recent date in the same form, scope and substance as described in Section 6.22(c)(ii), with respect to such Post-closing Mortgaged Property. (d) Any loan (each a "subject loan") by an Obligor to a Foreign Subsidiary shall satisfy the collateral security and other requirements of this clause (d) if each of the following conditions shall be satisfied (and in the case of clauses (i), (ii) and (iii), shall be satisfied continuously): (i) the subject loan shall be secured by a valid and enforceable first-priority Lien, free and clear of all other Liens, in and to all of the real property, fixtures and personal property (tangible and intangible) of such Foreign Subsidiary; (ii) all or substantially all of such collateral security is located in a jurisdiction reasonably satisfactory to the Administrative Agent, including with respect to the ability of a secured party to enforce a Lien and realize upon the collateral security in such jurisdiction; (iii) such Foreign Subsidiary shall have no Investments in any other Foreign Subsidiary or Unrestricted Entity, other than (y) Investments in such Persons outstanding on the date of the subject loan that were not made in contemplation or connection with the subject loan and (z) any loans to such other Foreign Subsidiary which independently satisfy the requirements of this clause (d); and (iv) the receipt by the Administrative Agent of favorable written opinions (addressed to the Administrative Agent, the LC Bank and the Lenders of counsel to the Obligor and the Foreign Subsidiary (reasonably acceptable to the Administrative Agent) for each jurisdiction the law of which governs the creation, perfection or priority of such Lien, covering such matters as shall be reasonably requested by, and in form and Credit Agreement substance satisfactory to, and subject to exceptions customarily taken by legal counsel in such jurisdiction to the extent reasonably acceptable to, the Administrative Agent (and such Obligor and the Foreign Subsidiary shall instruct such counsel to deliver such opinions to the Administrative Agent, the LC Bank and the Lenders). (e) The Obligors shall (i) deliver to the Administrative Agent, within 10 days after the Effective Date, stock certificates representing all of the security interests granted pursuant capital stock of each Obligor (other than the capital stock of Chemco) and (ii) use commercially reasonable efforts to cause to be delivered to the Administrative Agent, as soon as possible after the Effective Date, the stock certificates representing 66% of each class of capital stock of each Foreign Subsidiary held, directly or (other than through another Foreign Subsidiary) indirectly, by each Obligor (and shall continue such efforts until such time as all such stock certificates shall have been so delivered), in each case duly endorsed in blank or accompanied by undated stock powers duly executed in blank and in form and substance reasonably satisfactory to the Administrative Agent. (f) The Obligors shall deliver to the Administrative Agent, as soon as possible after the Effective Date, such Security Documents, as shall be reasonably requested by the enforceability Administrative Agent, to create and perfect a Lien in favor of the Security Documents and the transactions contemplated thereby and concerning such other matters as the Noteholders may request. Subject to the execution by Grantors of the Security Documents in accordance with the first sentence of this paragraph and the satisfaction of the conditions set forth Administrative Agent in the preceding sentencetwo vessels used by ISP Alginates Inc. for kelp harvesting off the coast of San Diego, notwithstanding any provision of California, unless under applicable United States law the Note Agreements to Obligors are prohibited from granting the contrary, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens Administrative Agent a Lien in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended and Restated Credit Agreement, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended or modified to date, the "Credit Agreement"). Each of the Parent and the Company hereby acknowledges and agrees that the occurrence of any event of default under any of the Security Documents shall constitute an Event of Default under this Agreement and the Note Agreements.s

Collateral Security. As soon as practical but in any event not later than March 31, 2005, (a) Each of the Company, Quaker Textile Corporation, a Massachusetts corporation ("Quaker Textile"), Quaker Fabric Mexico, S.A. de C.V., a Mexican corporation ("Quaker Mexico")Lenders and the LC Bank hereby irrevocably authorize the Administrative Agent to execute and deliver, and Parent shall have granted to the Noteholders a perfected, first priority security interest (subject only to Liens permitted under paragraph 6G of each Note Agreement and entitled to priority under applicable law and the pari passu liens granted (or to be granted) to Fleet) in all personal property assets of the Company, Quaker Textile, Quaker Mexico and the Parent (collectively, the "Grantors"), whether now owned or hereafter acquired, pursuant to the terms of one or more security agreements, patent collateral assignment and security agreements, trademark collateral security and pledge agreements, memorandums of grants of security interest in copyrights, stock pledge agreements (pursuant to which the stock of the Company, Quaker Textile and Quaker Mexico shall be pledged to the Noteholders) and all other instruments and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed or delivered by the Noteholders, all in form and substance satisfactory to the Noteholders (collectively, the "Security Documents"). Notwithstanding the foregoing, no Grantor shall be required to grant a security interest in any of its personal property aassets located outside of the United States (collectively, the "Excluded Assets"), provided that each of the Grantors hereby agrees that no such Person shall otherwise enter into any agreementor accept, instrument or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all or any portion of the Excluded Assets. In connection with the execution and delivery of the Security Documents, the Grantors shall (i) execute and deliver to the Noteholders, and facilitate the execution and delivery by Fleet of, an intercreditor agreement, in form and substance satisfactory to the Noteholders in their sole and absolute discretion, among the Noteholders, Fleet, and the Grantors, and (ii) deliver to the Noteholders a favorable legal opinion, in form and substance satisfactory to the Noteholders, from counsel to the Grantors concerning corporate authority matters, perfection of the security interests granted pursuant to the Security Documents, the enforceability each of the Security Documents and referred to in Section 5.01(f) or other Security Documents necessary or (in the transactions contemplated thereby and concerning such other matters as the Noteholders may request. Subject to the execution by Grantors opinion of the Security Documents Administrative Agent) reasonably necessary to effect the requirements of Section 6.22. (b) Except as otherwise provided in accordance Section 9.02(b) with respect to this Agreement, the Administrative Agent may, with the first sentence of this paragraph and the satisfaction prior consent of the conditions set forth in the preceding sentenceRequired Lenders (but not otherwise), notwithstanding any provision of the Note Agreements to the contrary, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended and Restated Credit Agreementany modification, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended supplement or modified to date, the "Credit Agreement"). Each of the Parent and the Company hereby acknowledges and agrees that the occurrence of any event of default waiver under any of the Credit Documents, including agreeing to additional obligations (including obligations held by Persons other than Lenders and the Administrative Agent) being secured by any Collateral; provided that, without the prior consent of each Lender, the Administrative Agent shall not (except as provided herein or in the Security Documents) release any substantial part of the Collateral or otherwise terminate any substantial part of the Liens under any Security Document (whether by release of property or Obligor) or alter the relative priorities of the obligations entitled to the benefits of the Liens created under the Security Documents; provided further that no such consent of any Lender shall be required, and the Administrative Agent is hereby authorized, to release any Lien covering Collateral (and to release any such guarantor) (i) that is the subject of a disposition of property permitted hereunder or under any of the other Credit Documents pursuant to Section 6.22(b) or (ii) that is the property of a Subsidiary that has been designated an Unrestricted Entity in accordance with Section 6.16(e). (c) The Lenders and the LC Bank hereby agree, solely for the benefit of the Administrative Agent, that the Administrative Agent may terminate any and all Liens created by the Security Documents at and after the time that (i) all of the Loans shall constitute have become due (whether at stated maturity, upon acceleration or otherwise), (ii) such Loans and all interest thereon, and all fees payable hereunder, shall have been paid in full in cash, (iii) all Commitments of the Lenders shall have terminated and (iv) all Letters of Credit shall have expired or have been cancelled, unless prior to such time any Lender or the LC Bank shall have delivered to the Administrative Agent a written notice that such Lender or LC Bank holds a Secured Obligation under a Hedge Agreement, cash management arrangement or foreign exchange contract, a Guarantee thereof or a claim for an Event indemnity or expense hereunder, and such Lender or the LC Bank shall not have (A) delivered to the Administrative Agent a subsequent written notice that such Secured Obligation shall have been satisfied or discharged or (B) consented to the termination of Default under this Agreement and the Note Agreements.such Liens. Credit Agreement

Collateral Security. As soon (a) Except for the Liens granted to Lender pursuant to this Agreement and Liens referred to in Section 3.11, Borrower owns and will own each item which it pledges on the date hereof or may hereinafter pledge as practical but Collateral, free and clear of any and all Liens. No security agreement, financing statement or other public notice similar in effect with respect to all or any part of the Collateral is or will be on file or of record in any event not later than March 31public office, 2005except such as have been or may hereinafter be filed in favor of Lender pursuant to this Agreement, and except in connection with the security interest referred to in Section 3.11. (b) This Agreement is effective to create, as collateral security for the Obligations and the Other RF Obligations, valid and enforceable Liens on the Collateral in favor of Lender. (c) Upon filing of the financing statement(s) delivered to Lender by Borrower on the Closing Date with the Secretary of State of the State of New Jersey (which financing statement(s) is in proper form for filing in such jurisdiction) and the delivery to, and continuing possession by, Lender or its nominee of the Pledged Securities, the Company, Quaker Textile Corporation, Liens created pursuant to this Agreement will constitute a Massachusetts corporation ("Quaker Textile"), Quaker Fabric Mexico, S.A. de C.V., a Mexican corporation ("Quaker Mexico"), and Parent shall have granted to the Noteholders a perfected, first priority security interest (subject only to Liens permitted under paragraph 6G of each Note Agreement and entitled to priority under applicable law and the pari passu liens granted (or to be granted) to Fleet) in all personal property assets of the Company, Quaker Textile, Quaker Mexico and the Parent (collectively, the "Grantors"), whether now owned or hereafter acquired, pursuant to the terms of one or more security agreements, patent collateral assignment and security agreements, trademark collateral security and pledge agreements, memorandums of grants of perfected security interest in copyrights, stock pledge agreements the Collateral in favor of Lender (pursuant to which the stock of the Company, Quaker Textile and Quaker Mexico shall be pledged except to the Noteholders) and extent the Collateral may be deemed to represent funds on deposit in the Spread Account, the Class B Reserve Account or the Capitalized Interest Account as referred to in Section 3.11), which Liens will be prior to all other instruments Liens of all other Persons and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed or delivered by the Noteholders, which Liens are enforceable as such as against all in form and substance satisfactory to the Noteholders (collectively, the "Security Documents"). Notwithstanding the foregoing, no Grantor shall be required to grant a security interest in any of its personal property aassets located outside of the United States (collectively, the "Excluded Assets"), provided that each of the Grantors hereby agrees that no such Person shall enter into any agreement, instrument or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all or any portion of the Excluded Assets. In connection with the execution and delivery of the Security Documents, the Grantors shall (i) execute and deliver to the Noteholders, and facilitate the execution and delivery by Fleet of, an intercreditor agreement, in form and substance satisfactory to the Noteholders in their sole and absolute discretion, among the Noteholders, Fleet, and the Grantors, and (ii) deliver to the Noteholders a favorable legal opinion, in form and substance satisfactory to the Noteholders, from counsel to the Grantors concerning corporate authority matters, perfection of the security interests granted pursuant to the Security Documents, the enforceability of the Security Documents and the transactions contemplated thereby and concerning such other matters as the Noteholders may request. Subject to the execution by Grantors of the Security Documents in accordance with the first sentence of this paragraph and the satisfaction of the conditions set forth in the preceding sentence, notwithstanding any provision of the Note Agreements to the contrary, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended and Restated Credit Agreement, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended or modified to date, the "Credit Agreement"). Each of the Parent and the Company hereby acknowledges and agrees that the occurrence of any event of default under any of the Security Documents shall constitute an Event of Default under this Agreement and the Note AgreementsPersons.

Collateral Security. As soon as practical but (a) The indebtedness, liabilities and obligations of the Company under this Section 2A, however created or incurred, whether now existing or hereafter arising, due or to become due, absolute or contingent, direct or indirect, secured or unsecured, are among the obligations secured by the security interests, liens and encumbrances created by the Collateral Security Documents delivered to Agent, and Agent and the Banks are entitled to the benefit of the collateral security granted thereunder with respect to such indebtedness. (b) Notwithstanding the payment in any event not later than March 31, 2005full of all the Loans made under the Commitment, the Companytermination of the Commitment or the occurrence of the Termination Date, Quaker Textile Corporationthe Collateral shall continue to secure the indebtedness, a Massachusetts corporation liabilities and obligations of the Company under this Section 2A until all Letters of Credit shall have expired and all indebtedness, liabilities and obligations under this Section 2A shall have been paid in full. ("Quaker Textile")c) On the Termination Date and the occurrence of an Event of Default, Quaker Fabric MexicoRequired Banks may require (and in the case of an Event of Default occurring under Section 7.7 it shall be required automatically) that the Company deliver to Agent, S.A. de C.V.cash or U.S. Treasury Bills with maturities of not more than 90 days from the date of delivery (discounted in accordance with customary banking practice to present value to determine amount) in an amount equal at all times to one hundred ten percent (110%) of the outstanding undrawn amount of all Letters of Credit, a Mexican corporation such cash or U.S. Treasury Bills and all interest earned thereon to constitute cash collateral for all such Letters of Credit. At such time as such collateral is required to be and has not been deposited, Agent on behalf of Banks shall be entitled to liquidate such of the other collateral for the Loan ("Quaker Mexico")if any) as is necessary or appropriate in its sole judgment so as to create such cash collateral. (d) Any cash collateral deposited under subparagraph (c) above, and Parent all interest earned thereon, shall have granted to be held by Agent and invested and reinvested at the Noteholders a perfected, first priority security interest (subject only to Liens permitted under paragraph 6G of each Note Agreement and entitled to priority under applicable law expense and the pari passu liens granted (or to be granted) to Fleet) in all personal property assets written direction of the Company, Quaker Textile, Quaker Mexico and in U.S. Treasury Bills with maturities of no more than ninety (90) days from the Parent (collectively, the "Grantors"), whether now owned or hereafter acquired, pursuant to the terms date of one or more security agreements, patent collateral assignment and security agreements, trademark collateral security and pledge agreements, memorandums of grants of security interest in copyrights, stock pledge agreements (pursuant to which the stock of the Company, Quaker Textile and Quaker Mexico shall be pledged to the Noteholders) and all other instruments and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed or delivered by the Noteholders, all in form and substance satisfactory to the Noteholders (collectively, the "Security Documents"). Notwithstanding the foregoing, no Grantor shall be required to grant a security interest in any of its personal property aassets located outside of the United States (collectively, the "Excluded Assets"), provided that each of the Grantors hereby agrees that no such Person shall enter into any agreement, instrument or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all or any portion of the Excluded Assets. In connection with the execution and delivery of the Security Documents, the Grantors shall (i) execute and deliver to the Noteholders, and facilitate the execution and delivery by Fleet of, an intercreditor agreement, in form and substance satisfactory to the Noteholders in their sole and absolute discretion, among the Noteholders, Fleet, and the Grantors, and (ii) deliver to the Noteholders a favorable legal opinion, in form and substance satisfactory to the Noteholders, from counsel to the Grantors concerning corporate authority matters, perfection of the security interests granted pursuant to the Security Documents, the enforceability of the Security Documents and the transactions contemplated thereby and concerning such other matters as the Noteholders may request. Subject to the execution by Grantors of the Security Documents in accordance with the first sentence of this paragraph and the satisfaction of the conditions set forth in the preceding sentence, notwithstanding any provision of the Note Agreements to the contrary, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended and Restated Credit Agreement, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended or modified to date, the "Credit Agreement"). Each of the Parent and the Company hereby acknowledges and agrees that the occurrence of any event of default under any of the Security Documents shall constitute an Event of Default under this Agreement and the Note Agreementsinvestment.

Collateral Security. As soon as practical but in any event not later than March 31(a) The indebtedness, 2005liabilities and obligations of Borrowers under this Section 2A, the Company, Quaker Textile Corporation, a Massachusetts corporation ("Quaker Textile"), Quaker Fabric Mexico, S.A. de C.V., a Mexican corporation ("Quaker Mexico"), and Parent shall have granted to the Noteholders a perfected, first priority security interest (subject only to Liens permitted under paragraph 6G of each Note Agreement and entitled to priority under applicable law and the pari passu liens granted (however created or to be granted) to Fleet) in all personal property assets of the Company, Quaker Textile, Quaker Mexico and the Parent (collectively, the "Grantors")incurred, whether now owned existing or hereafter acquiredarising, pursuant due or to become due, absolute or contingent, direct or indirect, secured or unsecured, are among the obligations secured by the security interests, liens and encumbrances created by the Collateral Security Documents delivered to Agent by Borrowers, and Agent and the Lenders are entitled to the terms benefit of one or more security agreements, patent collateral assignment and security agreements, trademark the collateral security and pledge agreements, memorandums of grants of security interest granted thereunder with respect to such indebtedness. (b) Notwithstanding the payment in copyrights, stock pledge agreements (pursuant to which the stock full of the Company, Quaker Textile and Quaker Mexico shall be pledged to the Noteholders) and all other instruments and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed or delivered by the Noteholders, all in form and substance satisfactory to the Noteholders (collectivelyLoan, the "Security Documents"). Notwithstanding the foregoing, no Grantor shall be required to grant a security interest in any of its personal property aassets located outside termination of the United States (collectively, the "Excluded Assets"), provided that each of the Grantors hereby agrees that no such Person shall enter into any agreement, instrument Commitment or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all or any portion of the Excluded Assets. In connection with the execution and delivery of the Security Documents, the Grantors shall (i) execute and deliver to the Noteholders, and facilitate the execution and delivery by Fleet of, an intercreditor agreement, in form and substance satisfactory to the Noteholders in their sole and absolute discretion, among the Noteholders, Fleet, and the Grantors, and (ii) deliver to the Noteholders a favorable legal opinion, in form and substance satisfactory to the Noteholders, from counsel to the Grantors concerning corporate authority matters, perfection of the security interests granted pursuant to the Security Documents, the enforceability of the Security Documents and the transactions contemplated thereby and concerning such other matters as the Noteholders may request. Subject to the execution by Grantors of the Security Documents in accordance with the first sentence of this paragraph and the satisfaction of the conditions set forth in the preceding sentence, notwithstanding any provision of the Note Agreements to the contrary, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended and Restated Credit Agreement, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended or modified to date, the "Credit Agreement"). Each of the Parent and the Company hereby acknowledges and agrees that the occurrence of any event the Termination Date, the Collateral shall continue to secure the indebtedness, liabilities and obligations of default Borrowers under any this Section 2A until all Letters of Credit shall have expired and all indebtedness, liabilities and obligations under this Section 2A shall have been paid in full. (c) On the termination of the Security Documents shall constitute Commitment or the occurrence of an Event of Default, Required Lenders may require (and in the case of an Event of Default occurring under this Agreement Paragraph 8.1(j) it shall be required automatically) that Borrowers deliver to Agent, cash or U.S. Treasury Bills with maturities of not more than 90 days from the date of delivery (discounted in accordance with customary banking practice to present value to determine amount) in an amount equal at all times to one hundred ten percent (110%) of the outstanding undrawn amount of all Letters of Credit, such cash or U.S. Treasury Bills and all interest earned thereon to constitute cash collateral for all such Letters of Credit. At such time as such collateral is required to be and has not been deposited, Agent on behalf of Lenders shall be entitled to liquidate such of the Note Agreementsother collateral for the Loan (if any) as is necessary or appropriate in its sole judgment so as to create such cash collateral. (d) Any cash collateral deposited under subparagraph (c) above, and all interest earned thereon, shall be held by Agent and invested and reinvested, at the reasonable and customary expense of Borrower, in U.S. Treasury Bills with maturities of no more than ninety (90) days from the date of investment.

Collateral Security. As soon as practical but (a) Each of the Obligors will, subject to each of the other lettered paragraphs of this Section, on the Effective Date and continuously thereafter at their expense, (i) create and maintain a valid and enforceable first-priority Lien, free and clear of all other Liens, in and to all of the Mortgaged Properties, and on the fixtures and personal property (tangible and intangible) of the Obligors existing on the Effective Date and thereafter arising and/or acquired, including intellectual property, accounts, general intangibles, goods (including inventory and equipment), claims against ISP Funding and securities (including the capital stock that any Obligor holds, directly or indirectly, in any event not later than March 31of the Subsidiaries of Chemco, 2005, the Company, Quaker Textile Corporation, a Massachusetts corporation ("Quaker Textile"including ISP Funding), Quaker Fabric Mexico, S.A. de C.V., a Mexican corporation ("Quaker Mexico"), and Parent shall have granted to the Noteholders a perfected, first priority security interest (subject only to Liens permitted under paragraph 6G of each Note Agreement and entitled to priority ii) perfect such Lien under applicable law through the execution and the pari passu liens granted (or to be granted) to Fleet) in all personal property assets of the Company, Quaker Textile, Quaker Mexico and the Parent (collectively, the "Grantors"), whether now owned or hereafter acquired, pursuant to the terms of one or more security agreements, patent collateral assignment and security agreements, trademark collateral security and pledge agreements, memorandums of grants of security interest in copyrights, stock pledge agreements (pursuant to which the stock of the Company, Quaker Textile and Quaker Mexico shall be pledged to the Noteholders) and all other instruments and documents, including without limitation Uniform Commercial Code financing statements, from time to time required to be executed or delivered delivery by the Noteholders, Obligors of all necessary and reasonably desirable Security Documents (in form and substance satisfactory to the Noteholders Administrative Agent) and (collectivelyiii) file, record and register, as applicable, such Security Documents with all necessary and (and in the "Security Documents"). Notwithstanding the foregoing, no Grantor shall be required to grant a security interest in any of its personal property aassets located outside opinion of the United States Administrative Agent) reasonably desirable offices, except: (collectively, i) to the "Excluded Assets"), provided extent of Permitted Liens on the Collateral; (ii) to the extent that each the Administrative Agent shall determine in its sole discretion that the costs of the Grantors hereby agrees that no creating such Person shall enter into any agreement, instrument or other undertaking which creates, incurs, assumes or suffers to exist a Lien on all any such property (or perfecting any portion Lien created in its favor therein or clearing any such adverse claim) are excessive in relation to the value of the Excluded Assets. collateral security to be afforded thereby; (iii) to the extent that any Intellectual Property (as such term is defined in the Pledge and Security Agreement) would be rendered invalid, abandoned, void or unenforceable by reason of its being included as part of the Collateral or is subject to a provision that restricts the assignment thereof that is enforceable under applicable law and the applicable Obligor is unable after using its best efforts (as determined by the Administrative Agent in its sole discretion) to obtain a waiver of such provision by the beneficiary thereof; (iv) the Belleville Property and (except to the extent provided in Section 6.13(a)) the Linden Property; (v) accounts receivable originated by any Obligor in connection with the sale or lease of inventory or the rendering of services in the ordinary course of business which are subject to sale to ISP Funding in connection with a Qualified Securitization Program and the proceeds thereof; and (vi) 34% of the shares of each class of capital stock of any Foreign Subsidiary held by an Obligor, directly or (other than through another Foreign Subsidiary) indirectly and 100% of the shares of capital stock of any Foreign Subsidiary held by an Obligor indirectly through another Foreign Subsidiary. (i) In connection with the execution and delivery each Disposition permitted hereunder or under any of the Security other Credit Documents, upon the Grantors request of the Lead Borrower, the Administrative Agent shall promptly (iA) release its Lien on such property, without any recourse or warranty or representation whatsoever, (B) deliver to the Lead Borrower any documentary Collateral that is the subject of such Disposition and (C) execute and deliver to the NoteholdersLead Borrower such Uniform Commercial Code release statements, mortgage releases and other instruments and documents as may be prepared by the Lead Borrower or the other Obligors that are reasonably required to effect the release of the Liens on the Collateral that is the subject of such Disposition, provided that at the time of such Disposition and the release of the Lien by the Administrative Agent, the Administrative Agent shall have obtained, through the efforts and at the expense of the Obligors, (y) a first-priority perfected security interest in the proceeds of such released Collateral and (z) in the reasonable discretion of the Administrative Agent, legal opinions (from counsel acceptable to it) addressed to the Lenders, the LC Bank and the Administrative Agent, covering such matters relating to the Lien of the Administrative Agent in such proceeds as it may reasonably request. (ii) In connection with the designation of an Unrestricted Entity in accordance with Section 6.16(e), the Administrative Agent shall promptly (A) release its Lien on all property of such Unrestricted Entity, without any recourse or warranty or representation whatsoever, (B) deliver to the Lead Borrower any documentary Collateral of such Unrestricted Entity and (C) execute and deliver to the Lead Borrower such Uniform Commercial Code release statements, mortgage releases and other instruments and documents as may be prepared by the Lead Borrower or such Unrestricted Entity that are reasonably required to effect the release of the Liens on the Collateral of such Unrestricted Entity. (1) The Obligors shall cause to be delivered to the Administrative Agent, in the case of any After-Acquired Mortgaged Property acquired by purchase on or prior to the Amendment and Restatement Date, not later than 90 days (or such shorter period as specifically set forth below) after the Amendment and Restatement Date and, in the case of any After-Acquired Mortgaged Property acquired by purchase after the Amendment and Restatement Date, not later than 90 days after the date of acquisition of such After-Acquired Mortgaged Property, the following documents, all of which shall be in form, scope and substance reasonably satisfactory to the Administrative Agent: (i) one or more policies of title insurance issued by the Title Company, in ALTA, extended coverage, Lender's Fee Policy form 1970 (revised 10/17/84) or such other form approved by the Administrative Agent, or a binding marked commitment to issue such policy or policies, insuring the Administrative Agent for the benefit of itself, the LC Bank and the Lenders, in an amount equal to at least 110% of the fair market value of such After-Acquired Mortgaged Property, as certified by the Lead Borrower to the Administrative Agent, insuring that the relevant Obligor is lawfully seized and possessed of a fee simple interest in such After-Acquired Mortgaged Property, and facilitate also insuring the execution validity and delivery priority of the Liens created under the real property Security Documents with respect thereto, subject only to Permitted Liens; each such title policy shall contain: (A) full coverage against mechanics' liens (filed and inchoate), (B) a reference to the relevant survey with no survey exceptions except those theretofore approved by Fleet ofthe Administrative Agent and (C) such affirmative insurance and endorsements as the Administrative Agent may reasonably require; and each such title policy shall be accompanied by such reinsurance agreements between the Title Company and such other title companies that shall have been approved by the Administrative Agent, in ALTA Facultative Reinsurance Agreement 9/24/94 form or, in relation to any real property located in Texas, its equivalent, in each case, as the Administrative Agent may require; (ii) as-built metes and bounds surveys of recent date of each facility comprising such After-Acquired Mortgaged Property, including easements that benefit such facility, to be covered by the real property Security Documents, showing such matters as may be required by the Administrative Agent, which surveys shall be made in accordance with the "Minimum Standard Detail Requirements for ALTA/ACSM Land Title Surveys" jointly established and adopted by ALTA, ACSM and NSPS in 1999 with all measurements made in accordance with the "Minimum Angle, Distance and Closure Requirements for Survey Measurements Which Control Land Boundaries for ALTA/ACSM Land Title Surveys" or such other form and content that have been approved by the Administrative Agent and which contain "Optional Survey Responsibilities and Specifications" 1, 2, 3, 6, 7(a), 7(b), 7(c), 8, 9, 10, 11(b), 13, 14, 15 and 16 as specified on Table A to the "Minimum Standard Detail Requirements for ALTA/ACSM Land Title Surveys" and certified to the Administrative Agent, the LC Bank and the Lenders and the Title Company, such certificate to be in a form reasonably acceptable to the Administrative Agent, and shall have been prepared by a registered surveyor acceptable to the Administrative Agent; (iii) certified copies of permanent and unconditional certificates of occupancy (or, if it is not the practice to issue certificates of occupancy in a jurisdiction in which such After-Acquired Mortgaged Property is located, then such other evidence reasonably satisfactory to the Administrative Agent) permitting the fully functioning operation and occupancy of each Mortgaged Property and of such other permits necessary for the use and operation of each such facility issued by the respective Governmental Authorities having jurisdiction over each such facility, provided that to the extent that the Obligors are unable, after using commercially reasonable efforts during the 90-day period -103- following the date of acquisition of such After-Acquired Mortgaged Property, to deliver such items to the Administrative Agent within such period, such items not delivered by the end of such period shall not be required to be delivered pursuant to this clause (iii); (iv) evidence that the Borrowers shall have paid to the Title Company all expenses and premiums of the Title Company in connection with the issuance of such policies with respect to such After-Acquired Mortgaged Property and in addition shall have paid to the Title Company an intercreditor agreementamount equal to the recording and stamp taxes payable in connection with recording the applicable real property Security Documents in the appropriate county land office(s); and (v) such Security Documents, or amendments or supplements to such Security Documents, relating to such After-Acquired Mortgaged Property as the Administrative Agent shall request, duly executed and delivered by each Obligor and other Person intended to be a party thereto, in each case in form and substance satisfactory to special New York counsel to the Noteholders Administrative Agent (including in their sole and absolute discretionform necessary or desirable to file, among record or register, as applicable), together with such favorable written opinions (addressed to the NoteholdersAdministrative Agent, Fleet, the LC Bank and the GrantorsLenders) of such counsel (reasonably acceptable to the Administrative Agent) to the applicable Obligor for each jurisdiction the law of which governs the creation, perfection and priority of each Lien provided for by the Security Documents (or amendments or supplements thereto) required to be delivered by this clause (v), in each case covering such matters relating to the Obligors, the Security Documents and the Liens provided for by the Security Documents as shall be reasonably requested by the Administrative Agent, the LC Bank, the Lenders and special New York counsel to the Administrative Agent (and each Obligor hereby instructs such counsel to deliver such opinion to the Administrative Agent, the LC Bank and the Lenders). (2) The Obligors shall cause to be delivered to the Administrative Agent, in the case of any After-Acquired Mortgaged Property acquired by lease on or prior to the Amendment and Restatement Date, not later than 90 days (or such shorter period as specifically set forth below) after the Amendment and Restatement Date and, in the case of any After-Acquired Mortgaged Property acquired by lease after the Amendment and Restatement Date, not later than 90 days after the date of acquisition of such After-Acquired Mortgaged Property, the following documents, all of which shall be in form, scope and substance reasonably satisfactory to the Administrative Agent: (i) any consents or other documents that are required as a condition in order to create and maintain a valid and enforceable Lien on such After-Acquired Mortgaged Property, provided that to the extent that the Obligors are unable, after using commercially reasonable efforts during the 90-day period following the Amendment and Restatement Date or the date of acquisition of such After-Acquired Mortgaged Property, as the case may be, to obtain such consents and other documents within such period with respect to such After-Acquired Mortgaged Property, then such property shall no longer be deemed to be an After-Acquired Mortgaged Property; (ii) deliver within 15 days of the date (each, a "Consent Date") that all consents and other documents, if any, required by clause (i) above have been obtained with respect to such After-Acquired Mortgaged Property (it being understood and agreed that the Noteholders Consent Date for any such property shall be the Amendment and Restatement Date or the date of acquisition of such After-Acquired Mortgaged Property, as the case may be, if no such consents or documents are required), such Security Documents as the Administrative Agent shall request with respect to such After-Acquired Mortgaged Property, duly executed and delivered by each Obligor and other Person intended to be a favorable legal opinionparty thereto, in each case in form and substance satisfactory to the Noteholders, from special New York counsel to the Grantors concerning corporate authority mattersAdministrative Agent (including in form necessary or desirable to file, perfection record or register, as applicable), provided that any leasehold Security Document shall not limit the Obligor's right to terminate such leasehold interest upon reasonable prior notice to the Administrative Agent; (iii) within 90 days of the security interests granted pursuant applicable Consent Date, a policy of title insurance issued by the Title Company, in the same form, scope and substance as described in Section 6.22(c)(1)(i) with respect to such After-Acquired Mortgaged Property, in an amount equal to at least 110% of the fair market value of such property as certified by the Lead Borrower to the Security DocumentsAdministrative Agent, together with evidence that the enforceability Borrowers shall have paid to the Title Company all expenses and premiums of the Security Documents Title Company in connection with the issuance of such policy and the transactions contemplated thereby and concerning such other matters as the Noteholders may request. Subject in addition shall have paid to the execution by Grantors of Title Company an amount equal to the recording and stamp taxes payable in connection with recording the applicable real property Security Documents in accordance the appropriate county land office(s); and (iv) within 90 days of the applicable Consent Date, an as-built metes and bounds survey of recent date in the same form, scope and substance as described in Section 6.22(c)(1)(ii), with respect to such After-Acquired Mortgaged Property. (d) Any loan (each a "subject loan") by an Obligor to a Foreign Subsidiary (other than any subject loan permitted to be made pursuant to Section 6.07(f)(1)) shall satisfy the collateral security and other requirements of this clause (d) if each of the following conditions shall be satisfied (and in the case of clauses (i), (ii) and (iii), shall be satisfied continuously): (i) the subject loan shall be secured by a valid and enforceable first-priority Lien, free and clear of all other Liens (other than Permitted Liens), in and to all of the real property, fixtures and personal property (tangible and intangible) of such Foreign Subsidiary (to the extent permitted under local law); (ii) all or substantially all of such collateral security is located in a jurisdiction reasonably satisfactory to the Administrative Agent, including with respect to the ability of a secured party to enforce a Lien and realize upon the collateral security in such jurisdiction; (iii) such Foreign Subsidiary shall have no Investments in any other Foreign Subsidiary or Unrestricted Entity, other than (y) Investments in such Persons outstanding on the date of the subject loan that were not made in contemplation or connection with the first sentence subject loan and (z) any loans to such other Foreign Subsidiary which independently satisfy the requirements of this paragraph clause (d); and (iv) the receipt by the Administrative Agent of favorable written opinions (addressed to the Administrative Agent, the LC Bank and the satisfaction Lenders of the conditions set forth in the preceding sentence, notwithstanding any provision of the Note Agreements counsel to the contraryObligor and the Foreign Subsidiary (reasonably acceptable to the Administrative Agent) for each jurisdiction the law of which governs the creation, perfection or priority of such Lien, covering such matters as shall be reasonably requested by, and in form and substance satisfactory to, and subject to exceptions customarily taken by legal counsel in such jurisdiction to the extent reasonably acceptable to, the Noteholders hereby consent to the grant to Fleet by Grantors of pari passu liens in the collateral described in this paragraph as security for the obligations of Grantor to Fleet under the Second Amended Administrative Agent (and Restated Credit Agreement, dated as of February 14, 2002, among Parent, the Company and Fleet, among others (as amended or modified to date, the "Credit Agreement"). Each of the Parent such Obligor and the Company hereby acknowledges and agrees that the occurrence of any event of default under any of the Security Documents Foreign Subsidiary shall constitute an Event of Default under this Agreement and the Note Agreements.instruct such counsel t