GUARANTEE AND COLLATERAL AGREEMENT

Exhibit 10.23

EXECUTION VERSION

GUARANTEE AND COLLATERAL AGREEMENT

dated as of

July 31, 2007,

among

PHARMERICA CORPORATION,

ITS SUBSIDIARIES PARTY HERETO

and

JPMORGAN CHASE BANK, N.A.,

as Collateral Agent

TABLE OF CONTENTS

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GUARANTEE AND COLLATERAL AGREEMENT (this “ Agreement ”), dated as of July 31, 2007, among PHARMERICA CORPORATION, a Delaware corporation (the “ Borrower ”), the Subsidiaries of the Borrower from time to time party hereto and JPMORGAN CHASE BANK, N.A. (“ JPMCB ”), as Collateral Agent.

Reference is made to the Credit Agreement dated as of July 31, 2007 (as amended, supplemented or otherwise modified from time to time, the “ Credit Agreement ”), among the Borrower, the Lenders party thereto and JPMCB, as Administrative Agent. The Lenders have agreed to extend credit to the Borrower subject to the terms and conditions set forth in the Credit Agreement. The obligations of the Lenders to extend such credit are conditioned upon, among other things, the execution and delivery of this Agreement. The Subsidiary Loan Parties are subsidiaries of the Borrower, will derive substantial benefits from the extension of credit to the Borrower pursuant to the Credit Agreement and are willing to execute and deliver this Agreement in order to induce the Lenders to extend such credit. Accordingly, the parties hereto agree as follows:

ARTICLE I

Definitions

SECTION 1.01. Credit Agreement. (a) Capitalized terms used in this Agreement, not otherwise defined herein and defined in the Credit Agreement shall have the meanings specified in the Credit Agreement. Unless the context otherwise requires, all terms defined in the New York UCC (as defined herein) and not defined in this Agreement have the meanings specified therein; the term “instrument” shall have the meaning specified in Article 9 of the New York UCC.

(b) The rules of construction specified in Section 1.03 of the Credit Agreement also apply to this Agreement.

SECTION 1.02. Other Defined Terms. As used in this Agreement, the following terms have the meanings specified below:

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

“ Article 9 Collateral ” has the meaning assigned to such term in Section 4.01.

“ Borrower Group Members ” means, collectively, the Borrower and the Subsidiaries.

“ CHAMPVA ” means, collectively, the Civilian Health and Medical Program of the Department of Veteran Affairs, a program of medical benefits covering

retirees and dependents of former members of the armed services administered by the United States Department of Veteran Affairs and all laws, rules, regulations, manuals, orders, guidelines or requirements pertaining to such program, including (a) all Federal statutes (whether set forth in 38 U.S.C. § 1713 or elsewhere) affecting such program or applicable to CHAMPVA; and (b) all rules, regulations (including 38 C.F.R. § 17.54), manuals, orders and administrative, reimbursement and other guidelines of all Governmental Authorities promulgated in connection with such program (whether or not having the force of law), in each case as the same may be amended, supplemented or otherwise modified from time to time.

“ Collateral ” means Article 9 Collateral and Pledged Collateral.

“ Contingent Obligations ” means contingent obligations for indemnification, expense reimbursement, tax gross-up or yield protection as to which no claim has been made.

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

“ Copyrights ” means all of the following now owned or hereafter acquired by any Loan Party: (a) all copyright rights in any work subject to the copyright laws of the United States or any other country, whether as author, assignee, transferee or otherwise, and (b) all registrations and applications for registration of any such copyright in the United States, including registrations, recordings, supplemental registrations and pending applications for registration in the United States Copyright Office, including those listed on Schedule III.

“ Credit Agreement ” has the meaning assigned to such term in the preliminary statement of this Agreement.

“ Excluded Equity Interests ” has the meaning assigned to such term in Section 3.01.

“ Federal Securities Laws ” has the meaning assigned to such term in Section 5.04.

“ General Intangibles ” has the meaning assigned to such term in Article 9 of the New York UCC and, for the avoidance of doubt, includes indemnification claims and contract rights.

“ Immaterial Indebtedness ” means, with respect to any Loan Party, Indebtedness of any other Borrower Group Member that is less than $500,000 in the aggregate for all such Indebtedness of such Borrower Group Member owing to such Loan Party.

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

“ IP Agreements ” has the meaning assigned to such term in Section 4.02(a).

“ License ” means any Patent License, Trademark License, Copyright License or other license or sublicense agreement relating to intellectual property to which any Loan Party is a party.

“ Medicaid Receivable ” means any Account with respect to which the obligor is a state Governmental Authority (or agent thereof) obligated to pay, pursuant to Federal or state Medicaid program statutes or regulations, for services rendered to eligible beneficiaries thereunder.

“ Medicare Receivable ” means any Account with respect to which the obligor is a Federal Governmental Authority (or agent thereof) obligated to pay, pursuant to federal Medicare program statutes or regulations, for services rendered to eligible beneficiaries thereunder.

“ New York UCC ” means the Uniform Commercial Code as from time to time in effect in the State of New York.

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

“ Patents ” means all of the following now owned or hereafter acquired by any Loan Party: (a) all letters patent of the United States or the equivalent thereof in any other country, all registrations and recordings thereof, and all applications for letters patent of the United States or the equivalent thereof in any other country, including registrations, recordings and pending applications in the United States Patent and Trademark Office, including those listed on Schedule III, and (b) all reissues, continuations, divisions, continuations-in-part, renewals or extensions thereof, and the inventions disclosed or claimed therein, including the right to make, use and/or sell the inventions disclosed or claimed therein.

“ Pledged Collateral ” has the meaning assigned to such term in Section 3.01.

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“ Pledged Equity Interests ” has the meaning assigned to such term in Section 3.01.

“ Pledged Indebtedness ” has the meaning assigned to such term in Section 3.01.

“ Pledged Securities ” means any promissory notes, stock certificates or other securities certificates or instruments now or hereafter included in the Pledged Collateral, including all certificates and instruments representing or evidencing any Pledged Collateral.

“ Proceeds ” has the meaning assigned to such term in Section 9-102 of the New York UCC.

“ Retained Collection Rights ” means, with respect to any Medicaid Receivable, Medicare Receivable, TRICARE Receivable or VA Receivable of any Loan Party, the right of such Loan Party to collect and receive from the obligor thereon payments in respect of such receivable in the absence of a court order requiring such obligor to submit payments thereon directly to a Person other than such Loan Party.

“ Secured Cash Management/Purchasing Card Obligations ” means the obligations described in clause (c) of the definition of the term “Secured Obligations”.

“ Secured Hedge Obligations ” means the obligations described in clause (b) of the definition of the term “Secured Obligations”.

“ Secured Parties ” means, collectively, (a) the Lenders, (b) the Collateral Agent, (c) the Administrative Agent, (d) the Issuing Banks, (e) the beneficiaries of each indemnification obligation undertaken by any Loan Party under any Loan Document, (f) each other Person to whom any of the Secured Obligations (including Secured Hedge Obligations and Secured Cash Management/Purchasing Card Obligations) is owed and (g) the successors and assigns of each of the foregoing.

“ Security Interest ” has the meaning assigned to such term in Section 4.01.

“ Specified Pledged Equity Interests ” means, with respect to any Loan Party, any Pledged Equity Interests that are Equity Interests in a Subsidiary.

“ Specified Pledged Indebtedness ” means, with respect to any Loan Party, Pledged Indebtedness (other than Immaterial Indebtedness) owing to it by any other Borrower Group Member.

“ Specified Pledged Securities ” means, collectively, the Specified Pledged Equity Interests and the Specified Pledged Indebtedness.

“ Trademark License ” means any written agreement, now or hereafter in effect, granting to any third party any right to use any trademark now or hereafter owned by any Loan Party or that any Loan Party otherwise has the right to license, or granting to

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any Loan Party any right to use any trademark now or hereafter owned by any third party, and all rights of any Loan Party under any such agreement.

“ Trademarks ” means all of the following now owned or hereafter acquired by any Loan Party: (a) all trademarks, service marks, trade names, corporate names, company names, business names, fictitious business names, trade styles, trade dress, logos, other source or business identifiers, designs and general intangibles of like nature, now existing or hereafter adopted or acquired, all registrations and recordings thereof, and all registration and recording applications filed in connection therewith, and all extensions or renewals thereof, including registrations and registration applications in the United States Patent and Trademark Office or any similar offices in any State of the United States, and all extensions, or renewals thereof, including those listed on Schedule III, (b) all goodwill associated therewith or symbolized thereby and (c) all other assets, rights and interests that uniquely reflect or embody such goodwill.

“ TRICARE ” means, collectively, a program of medical benefits covering former and active members of the uniformed services and certain of their dependents, financed and administered by the United States Department of Defense, Department of Health and Human Services and Department of Transportation, which program was formerly known as the Civilian Health and Medical Program of the Uniformed Services (CHAMPUS), and all laws, rules, regulations, manuals, orders and administrative, reimbursement and other guidelines of all Governmental Authorities promulgated in connection with such program (whether or not having the force of law), in each case as the same may be amended, supplemented or otherwise modified from time to time.

“ TRICARE Receivable ” means any Account payable pursuant to TRICARE.

“ VA Receivable ” means any Account payable pursuant to CHAMPVA.

ARTICLE II

Guarantee

SECTION 2.01. Guarantee. Each Subsidiary Loan Party unconditionally guarantees, jointly with the other Subsidiary Loan Parties and severally, as a primary obligor and not merely as a surety, the due and punctual payment and performance of the Secured Obligations. Each of the Subsidiary Loan Parties further agrees that the Secured Obligations may be extended or renewed, in whole or in part, without notice to or further assent from it, and that it will remain bound upon its guarantee notwithstanding any extension or renewal of any Secured Obligation. Each of the Subsidiary Loan Parties waives presentment to, demand of payment from and protest to the Borrower or any other Subsidiary Loan Party of any of the Secured Obligations, and also waives notice of acceptance of its guarantee and notice of protest for nonpayment.

SECTION 2.02. Guarantee of Payment. Each of the Subsidiary Loan Parties further agrees that its guarantee hereunder constitutes a guarantee of payment

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when due and not of collection. Each of the Subsidiary Loan Parties waives any right to require that any resort be had by the Collateral Agent or any other Secured Party to any security held for the payment of the Secured Obligations or to any balance of any deposit account or credit on the books of the Collateral Agent or any other Person in favor of the Borrower or any Subsidiary Loan Party.

SECTION 2.03. No Limitations. (a) Except for termination or release of a Subsidiary Loan Party’s obligations hereunder as expressly provided in Section 7.12, the obligations of each Subsidiary Loan Party hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense or set-off, counterclaim, recoupment or termination whatsoever by reason of the invalidity, illegality or unenforceability of the Secured Obligations or otherwise. Without limiting the generality of the foregoing, the obligations of each Subsidiary Loan Party hereunder shall not be discharged or impaired or otherwise affected by (i) the failure of the Collateral Agent or any other Secured Party to assert any claim or demand or to enforce any right or remedy under the provisions of any Loan Document or otherwise; (ii) any rescission, waiver, amendment or modification of, or any release from any of the terms or provisions of, any Loan Document or any other agreement, including with respect to any other Subsidiary Loan Party under this Agreement; (iii) the release of any security held by the Collateral Agent or any other Secured Party for the Secured Obligations or any of them; (iv) any default, failure or delay, willful or otherwise, in the performance of the Secured Obligations; or (v) any other act or omission that may or might in any manner or to any extent vary the risk of any Subsidiary Loan Party or otherwise operate as a discharge of any Subsidiary Loan Party as a matter of law or equity (other than the payment in full in cash of all the Secured Obligations). Each Subsidiary Loan Party expressly authorizes the Secured Parties, to the fullest extent permitted by applicable law, to take and hold security for the payment and performance of the Secured Obligations, to exchange, waive or release any or all such security (with or without consideration), to enforce or apply such security and direct the order and manner of any sale thereof in their sole discretion or to release or substitute any one or more other guarantors or obligors upon or in respect of the Secured Obligations, all without affecting the obligations of any Subsidiary Loan Party hereunder.

(b) To the fullest extent permitted by applicable law, each Subsidiary Loan Party waives any defense based on or arising out of any defense of the Borrower or any other Loan Party or the unenforceability of the Secured Obligations or any part thereof from any cause, or the cessation from any cause of the liability of the Borrower or any other Loan Party, other than the payment in full in cash of all the Secured Obligations. The Collateral Agent and the other Secured Parties may, at their election, foreclose on any security held by one or more of them by one or more judicial or nonjudicial sales, accept an assignment of any such security in lieu of foreclosure, compromise or adjust any part of the Secured Obligations, make any other accommodation with the Borrower or any other Loan Party or exercise any other right or remedy available to them against the Borrower or any other Loan Party, without affecting or impairing in any way the liability of any Subsidiary Loan Party hereunder except to the extent the Secured Obligations have been fully paid in full in cash or the guarantee of

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such Subsidiary Loan Party has been terminated or released pursuant to Section 7.12. To the fullest extent permitted by applicable law, each Subsidiary Loan Party waives any defense arising out of any such election even though such election operates, pursuant to applicable law, to impair or to extinguish any right of reimbursement or subrogation or other right or remedy of such Subsidiary Loan Party against the Borrower or any other Loan Party, as the case may be, or any security.

SECTION 2.04. Reinstatement. Each of the Subsidiary Loan Parties agrees that its guarantee hereunder shall, to the fullest extent permitted by applicable law, continue to be effective or be reinstated, as the case may be, if at any time payment of any Secured Obligation, or any part thereof, is rescinded or must otherwise be restored by the Collateral Agent or any other Secured Party upon the bankruptcy or reorganization of the Borrower, any other Loan Party or otherwise.

SECTION 2.05. Agreement To Pay; Subrogation. In furtherance of the foregoing and not in limitation of any other right that the Collateral Agent or any other Secured Party has at law or in equity against any Subsidiary Loan Party by virtue hereof, upon the failure of any Loan Party to pay any Secured Obligation that such Loan Party is obligated to pay, when and as the same shall become due, whether at maturity, by acceleration, after notice of prepayment or otherwise, each Subsidiary Loan Party hereby promises to and will forthwith pay, or cause to be paid, to the Collateral Agent for distribution to the applicable Secured Parties in cash the amount of such unpaid Secured Obligation. Upon payment by any Subsidiary Loan Party of any sums to the Collateral Agent as provided above, all rights of such Subsidiary Loan Party against the Borrower or any other Loan Party arising as a result thereof by way of right of subrogation, contribution, reimbursement, indemnity or otherwise shall in all respects be subject to Article VI.

SECTION 2.06. Information. Each Subsidiary Loan Party assumes all responsibility for being and keeping itself informed of the Borrower’s and each other Subsidiary Loan Party’s financial condition and assets, and of all other circumstances bearing upon the risk of nonpayment of the Secured Obligations and the nature, scope and extent of the risks that such Subsidiary Loan Party assumes and incurs hereunder, and agrees that none of the Collateral Agent or the other Secured Parties will have any duty to advise such Subsidiary Loan Party of information known to it or any of them regarding such circumstances or risks.

ARTICLE III

Pledge of Securities

SECTION 3.01. Pledge. As security for the payment or performance, as the case may be, in full of the Secured Obligations, each Loan Party hereby assigns and pledges to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, and hereby grants to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, a security interest in, all of such Loan Party’s right, title and interest in, to and under (a)(i) the shares of capital stock and other

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Equity Interests owned by such Loan Party on the date hereof (including all such shares and other Equity Interests in the Subsidiaries listed opposite the name of such Loan Party on Schedule II), (ii) any Equity Interests obtained in the future by such Loan Party and (iii) the certificates representing all such Equity Interests (all of the foregoing being collectively referred to as the “ Pledged Equity Interests ”); provided that the Pledged Equity Interests shall not include (A) more than 66% of the issued and outstanding voting Equity Interests of any CFC or (B) Equity Interests in any Person other than a wholly-owned Subsidiary where such assignment or pledge hereunder requires, pursuant to the constituent documents of such Person or any related joint venture, shareholder or like agreement binding on any shareholder, partner or member of such Person, the consent of any governing body, shareholder, partner or member of such Person and such consent shall not have been obtained (the Equity Interests so excluded being collectively referred to herein as the “ Excluded Equity Interests ”); (b)(i) debt securities owned by such Loan Party on the date hereof (including all such debt securities of other Borrower Group Members (other than Immaterial Indebtedness) listed opposite the name of such Loan Party on Schedule II), (ii) any debt securities obtained in the future by such Loan Party and (iii) all promissory notes and any other instruments evidencing such debt securities (all of the foregoing being collectively referred to as the “ Pledged Indebtedness ”); (c) subject to Section 3.06, all payments of principal or interest, dividends, cash, instruments and other property from time to time received, receivable or otherwise distributed in respect of, in exchange for or upon the conversion of, and all other Proceeds received in respect of, the securities and instruments referred to in clauses (a) and (b) above; (d) subject to Section 3.06, all rights and privileges of such Loan Party with respect to the securities, instruments and other property referred to in clauses (a), (b) and (c) above; and (e) all Proceeds of any of the foregoing (the items referred to in clauses (a) through (e) above being collectively referred to as the “ Pledged Collateral ”).

TO HAVE AND TO HOLD the Pledged Collateral, together with all right, title, interest, powers, privileges and preferences pertaining or incidental thereto, unto the Collateral Agent, its successors and assigns, for the benefit of the Secured Parties, forever; subject , however , to the terms, covenants and conditions hereinafter set forth.

SECTION 3.02. Delivery of the Pledged Collateral. (a) Each Loan Party agrees to deliver or cause to be delivered to the Collateral Agent any and all Specified Pledged Securities at any time owned by such Loan Party promptly upon acquiring such Specified Pledged Securities.

(b) Each Loan Party will cause any Indebtedness for borrowed money owed to it by any other Borrower Group Member (other than Immaterial Indebtedness) to be evidenced by a duly executed promissory note that is pledged and delivered to the Collateral Agent pursuant to the terms hereof.

(c) Upon delivery to the Collateral Agent, all Specified Pledged Securities shall be accompanied by stock powers duly executed in blank or other instruments of transfer reasonably satisfactory to the Collateral Agent. Each delivery of Specified Pledged Securities after the date of this Agreement shall be accompanied by a schedule describing the Specified Pledged Securities so delivered, which schedule shall be

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attached to Schedule II hereto and made a part thereof; provided that failure to so attach any such schedule shall not affect the validity of such pledge of such Specified Pledged Securities.

(d) The security interests granted in Section 3.01 are granted as security only and shall not subject the Collateral Agent or any other Secured Party to, or in any way alter or modify, any obligation or liability of any Loan Party with respect to or arising out of the Pledged Collateral.

SECTION 3.03. Representations, Warranties and Covenants. The Loan Parties jointly and severally represent, warrant and covenant to and with the Collateral Agent, for the benefit of the Secured Parties, that:

(a) Schedule II sets forth a true and complete list, with respect to each Loan Party, of (i) all the Equity Interests owned by such Loan Party in the Subsidiaries on the date hereof (other than any Excluded Equity Interests), setting forth the percentage of the issued and outstanding units of each class of the Equity Interests of the issuer thereof represented by the Pledged Equity Interests of such Loan Party, and (ii) all Specified Pledged Indebtedness owned by such Loan Party on the date hereof, including all promissory notes in respect thereof;

(b) except to the extent any failure to be so authorized or issued could not, in the aggregate, be reasonably expected to be adverse to the interests of the Secured Parties in any material respect, (i) the Pledged Equity Interests and Pledged Indebtedness have been duly and validly authorized and issued by the issuers thereof, (ii) in the case of Pledged Equity Interests, the same are fully paid and nonassessable and (iii) in the case of Pledged Indebtedness, the same are valid and binding obligations of the issuers thereof, subject to applicable bankruptcy, insolvency, reorganization, moratorium and other laws affecting creditors’ rights generally, concepts of reasonableness and general principles of equity, regardless of whether considered in a proceeding in equity or at law;

(c) except for the security interests granted hereunder, each of the Loan Parties (i) is and, subject to any transfers made in compliance with the Credit Agreement, will continue to be the direct owner, beneficially, and to the extent applicable, of record, of the Specified Pledged Securities indicated on Schedule II as owned by such Loan Party, (ii) holds the same free and clear of all Liens, other than Liens created by this Agreement and Permitted Encumbrances, and (iii) will, to the extent commercially reasonable, defend its title or interest thereto or therein against any and all Liens (other than the Lien created by this Agreement and Permitted Encumbrances), however arising, of all Persons whomsoever; and

(d) no consent or approval of any Governmental Authority, any securities exchange or any other Person was or is necessary to the validity of the pledge effected hereby (other than such consents and approvals as have been obtained and are in full force and effect).

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SECTION 3.04. Certification of Limited Liability Company and Limited Partnership Interests. Each Loan Party acknowledges and agrees that (a) each interest in any limited liability company or limited partnership that is a Specified Pledged Equity Interest pledged hereunder and not represented by a certificate shall not be a “security” within the meaning of Article 8 of the New York UCC and shall not be governed by Article 8 of the Uniform Commercial Code of the applicable jurisdiction and (b) the Loan Parties shall at no time elect to treat any such interest as a “security” within the meaning of Article 8 of the New York UCC or issue any certificate representing such interest (except that the Loan Parties may elect to so treat any such interest as a “security” and issue any certificate representing such interest if promptly thereafter the applicable Loan Party delivers such certificate to the Collateral Agent).

SECTION 3.05. Registration in Nominee Name; Denominations. The Collateral Agent, on behalf of the Secured Parties, shall have the right to hold the Specified Pledged Securities in the name of the applicable Loan Party, endorsed or assigned in blank or in favor of the Collateral Agent or, at any time upon the occurrence and during the continuance of an Event of Default, in its own name (as pledgee) or the name of its nominee (as pledgee or as sub-agent). Upon the occurrence and during the continuance of an Event of Default, each Loan Party will promptly give to the Collateral Agent copies of any material notices or other communications received by it with respect to Pledged Securities registered in the name of such Loan Party.

SECTION 3.06. Voting Rights; Dividends and Interest. (a) Unless and until an Event of Default shall have occurred and be continuing and the Collateral Agent shall have notified the Loan Parties that their rights under this Section 3.06 are being suspended (such notice to be provided at least one Business Day prior to the date of effectiveness of such suspension):

(i) Each Loan Party shall be entitled to exercise any and all voting and/or other consensual rights and powers inuring to an owner of Pledged Equity Interests or Pledged Indebtedness; provided that such rights and powers shall not be exercised after such notice in any manner that could materially and adversely affect the rights inuring to a holder of any Pledged Equity Interests or any Pledged Indebtedness or the rights and remedies of any of the Collateral Agent or the other Secured Parties under this Agreement or any other Loan Document or the ability of the Secured Parties to exercise the same.

(ii) The Collateral Agent shall execute and deliver to each Loan Party, or cause to be executed and delivered to such Loan Party, all such proxies, powers of attorney and other instruments as such Loan Party may reasonably request for the purpose of enabling such Loan Party to exercise the voting and/or consensual rights and powers it is entitled to exercise pursuant to subparagraph (i) above.

(iii) Each Loan Party shall be entitled to receive and retain any and all dividends, interest, principal and other distributions paid on or distributed in respect of the Pledged Equity Interests and the Pledged Indebtedness to the extent and only to the extent that such dividends, interest, principal and other

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distributions are not prohibited by the terms and conditions of the Credit Agreement, the other Loan Documents and applicable laws; provided that any noncash dividends, interest, principal or other distributions that would constitute Pledged Equity Interests or Pledged Indebtedness, whether resulting from a subdivision, combination or reclassification of the outstanding Equity Interests of the issuer of any Pledged Equity Interests or received in exchange for Pledged Equity Interests or Pledged Indebtedness or any part thereof, or in redemption thereof, or as a result of any merger, consolidation, acquisition or other exchange of assets to which such issuer may be a party or otherwise, shall be and become part of the Pledged Collateral, and to the extent constituting a Specified Pledged Security, if received by any Loan Party shall be held in trust for the benefit of the Collateral Agent and the other Secured Parties and shall be forthwith delivered to the Collateral Agent in the same form as so received (with any necessary endorsement).

(b) Upon the occurrence and during the continuance of an Event of Default, after the Collateral Agent shall have notified the Loan Parties of the suspension of their rights under paragraph (a)(iii) of this Section 3.06, then all rights of any Loan Party to dividends, interest, principal or other distributions that such Loan Party is authorized to receive pursuant to paragraph (a)(iii) of this Section 3.06 shall cease, and all such rights shall thereupon become vested in the Collateral Agent, which shall have the sole and exclusive right and authority to receive and retain such dividends, interest, principal or other distributions. All dividends, interest, principal or other distributions received by any Loan Party contrary to the provisions of this Section 3.06 shall be held in trust for the benefit of the Collateral Agent and the other Secured Parties, shall be segregated from other property or funds of such Loan Party and shall be forthwith delivered to the Collateral Agent upon demand in the same form as so received (with any necessary endorsement). Any and all money and other property paid over to or received by the Collateral Agent pursuant to the provisions of this paragraph (b) shall be retained by the Collateral Agent in an account to be established by the Collateral Agent upon receipt of such money or other property and shall be applied in accordance with the provisions of Section 5.02. After all Events of Default have been cured or waived and the Borrower has delivered to the Collateral Agent a certificate to that effect, the Collateral Agent shall promptly repay to each Loan Party (without interest) all dividends, interest, principal or other distributions that such Loan Party would otherwise be permitted to retain pursuant to the terms of paragraph (a)(iii) of this Section 3.06 and that remain in such account.

(c) Upon the occurrence and during the continuance of an Event of Default, after the Collateral Agent shall have notified the Loan Parties of the suspension of their rights under paragraph (a)(i) of this Section 3.06, then (subject to any restriction contained in joint venture agreements in respect of the applicable Pledged Equity Interests) all rights of any Loan Party to exercise the voting and consensual rights and powers it is entitled to exercise pursuant to paragraph (a)(i) of this Section 3.06, and the obligations of the Collateral Agent under paragraph (a)(ii) of this Section 3.06, shall cease, and all such rights shall thereupon become vested in the Collateral Agent, which shall have the sole and exclusive right and authority to exercise such voting and

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consensual rights and powers; provided that, unless otherwise directed by Lenders constituting “Required Lenders” under the Credit Agreement, the Collateral Agent shall have the right from time to time following and during the continuance of an Event of Default to permit the Loan Parties to exercise such rights. After all Events of Default have been cured or waived and the Borrower has delivered to the Collateral Agent a certificate to that effect, the voting and consensual rights and powers the Loan Parties are otherwise entitled to exercise pursuant to paragraph (a)(i) of this Section 3.06 shall be restored.

(d) Any notice given by the Collateral Agent to the Loan Parties suspending their rights under paragraph (a) of this Section 3.06 may (i) be given by telephone if promptly confirmed in writing, (ii) be given to one or more of the Loan Parties at the same or different times and (iii) suspend the rights of the Loan Parties under paragraph (a)(i) or paragraph (a)(iii) in part without suspending all such rights (as specified by the Collateral Agent in its sole and absolute discretion) and without waiving or otherwise affecting the Collateral Agent’s rights to give additional notices from time to time suspending other rights so long as an Event of Default has occurred and is continuing.

ARTICLE IV

Security Interests in Personal Property

SECTION 4.01. Security Interest. (a) As security for the payment or performance, as the case may be, in full of the Secured Obligations, each Loan Party hereby assigns and pledges to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, and hereby grants to the Collateral Agent, its successors and permitted assigns, for the benefit of the Secured Parties, a security interest (the “ Security Interest ”) in, all right, title and interest in, to and under any and all of the following assets and properties now owned or at any time hereafter acquired by such Loan Party or in which such Loan Party now has or at any time in the future may acquire any right, title or interest (collectively, the “ Article 9 Collateral ”):

(i) all Accounts, including all Health-care-insurance Receivables;

(ii) all Chattel Paper;

(iii) all Documents;

(iv) all Equipment;

(v) all Inventory;

(vi) all other Goods;

(vii) all Instruments;

(viii) all Investment Property;

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(ix) all Intellectual Property (except for “intent-to-use” applications for a trademark or service mark, to the extent that, and solely during the period in which, the grant of a security interest therein would impair the validity or enforceability of such “intent-to-use” application under applicable Federal law);

(x) all other General Intangibles;

(xi) all Letter-of-Credit Rights that are Supporting Obligations;

(xii) all Commercial Tort Claims specifically described on Schedule IV hereto, as such schedule may be supplemented from time to time pursuant to the terms hereof;

(xiii) all books and records pertaining to any Article 9 Collateral; and

(xiv) to the extent not otherwise included, all Proceeds and products of any and all of the foregoing and all collateral security and guarantees given by any Person with respect to any of the foregoing;

provided that, Article 9 Collateral shall not include (A) Intellectual Property to the extent, but only to the extent that, perfection of a security interest therein requires a filing to be made in any jurisdiction other than the United States, any political subdivision thereof or its territories or possessions, (B) the Excluded Equity Interests, (C) to the extent (but only to the extent) that at any time the Collateral Agent may not validly possess a security interest in any Retained Collection Rights under applicable law, such Retained Collection Rights, (D) any contract, agreement, lease, license or permit to which a Loan Party is a party or any of its rights or interests thereunder if and for so long as the grant of such security interest shall constitute or result in (1) the unenforceability of any right of the Loan Party therein or (2) a breach or termination pursuant to the terms of, or a default under, any such contract, agreement, lease, license or permit (other than to the extent that any such term would be rendered ineffective pursuant to Section 9-406, 9-407, 9-408 or 9-409 of the New York UCC or any other applicable law or principles of equity), provided that such security interest shall attach immediately at such time as the condition causing such unenforceability, breach or termination shall cease to be applicable and, to the extent severable, shall attach immediately to any portion of such contract or agreement that does not result in any of the consequences specified this clause, including any Proceeds of such contract or agreement, (E) motor vehicles the perfection of a security interest in which is excluded from the Uniform Commercial Code in the relevant jurisdiction, (F) Deposit Accounts (except to the extent constituting Collateral referred to in clause (xiv) above), (G) Letter-of-Credit Rights not constituting Supporting Obligations, (H) cash (except to the extent constituting Collateral referred to in clause (xiv) above), (I) real property leases and (J)