Amended and Restated Pledge Agreement

Amended and Restated Stock Pledge Agreement

This Amended and Restated Stock Pledge Agreement is made and entered into effective as of this day of , by , a Delaware limited liability company ("Pledgor"), in favor of , a Delaware corporation ("Services Provider").

R E C I T A L S

Pledgor and Services Provider entered into that certain Stock Pledge Agreement effective as of .

Pledgor and Services Provider desire to amend and restate said Stock Pledge Agreement to provide for a partial release of the Pledged Securities under the circumstances specified herein.

NOW THEREFORE, in consideration of the premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

A G R E E M E N T

1. Definitions.

1.1 "Agreement" or "this Agreement" shall mean and include all amendments, modifications and supplements hereto and shall refer to this Agreement as the same may be in effect at the time such reference becomes operative.

1.2 "Collateral" shall mean and include all of the Pledged Securities, together with all proceeds thereof and all cash, additional securities and other property at any time and from time to time receivable or otherwise distributed in respect of or in exchange for any or all of such Pledged Securities.

1.3 "Commission" shall mean the Securities and Exchange Commission, or any other federal agency then administering the Securities Act.

1.4 "Event of Default" shall mean any of the events listed in Section 6.1 of this Agreement.

1.5 "Note" shall mean the Variable Rate Note dated as of in the principal amount of issued by to Services Provider.

1.6 "Obligations" shall mean and include all liabilities, obligations, covenants and duties owing to Services Provider by Pledgor arising under this Agreement and the Note. The term also includes, without limitation, all interest, charges, expenses, fees, attorneys' fees and other sums chargeable to Pledgor under this Agreement or under the Note.

1.7 "Pledged Securities" shall mean the shares of Class B Common Stock of Services Provider initially pledged to Services Provider hereunder as set forth on Exhibit "A" attached hereto, together with all other securities from time to time pledged to Services Provider by Pledgor pursuant to the terms and conditions hereof.

1.8 "Release and Assumption Agreement" shall mean that agreement dated the date hereof by and among Pledgor, SHS and Services Provider pursuant to which Pledgor is assuming SHS's obligations to Services Provider under the Note.

1.9 "Securities Act" shall mean the Securities Act of 1933, as amended, or any similar federal statute, and the rules and regulations of the Commission thereunder, all as the same may from time to time be in effect.

1.10 "Securities Laws" shall mean the Securities Act, the Securities Exchange Act of 1934, as amended, or any similar federal statute, and the rules and regulations of the Commission thereunder, together with any and all applicable state blue sky laws and laws of foreign countries regulating the issuance, sale or transfer of securities, all as the same may from time to time be in effect.

1.11 "SHS" shall mean Sand Hill Systems, Inc., a Delaware corporation.

2. Pledge. To induce Services Provider to enter into the Release and Assumption Agreement and in consideration thereof and of any loans, advances or financial accommodations heretofore or hereafter granted by Services Provider to or for Pledgor's account, whether pursuant to the Release and Assumption Agreement or otherwise, all of which will inure to Pledgor's direct benefit, Pledgor hereby pledges, conveys, hypothecates, mortgages, assigns, sets over, delivers and grants to Services Provider a security interest in all of the Collateral now or hereafter owned by Pledgor as security for the payment and performance when due of the Obligations; to have and to hold the Collateral, together with all rights, title, interests, powers, privileges and preferences pertaining or incidental thereto, unto Services Provider, its successors and assigns forever, subject, however, to the terms, covenants and conditions hereinafter set forth.

3. Representations, Warranties and Covenants Regarding Collateral.

3.1 Due Authorization, Etc. The execution, delivery and performance of this Agreement, the creation of the liens and security interests and the delivery to Services Provider of the Collateral provided for hereunder are within Pledgor's corporate power, have been duly authorized by all necessary or proper corporate action, are not in contravention of any provision of law or of any agreement or indenture by which Pledgor is bound, or of Pledgor's Certificate of Formation or Company Agreement, and do not require the consent or approval of any governmental body, agency, authority or other person or entity, which has not been obtained and a copy thereof furnished to Services Provider.

3.2 Valid and Binding Obligation. This Agreement constitutes Pledgor's valid and legally binding obligation, enforceable in accordance with its terms, except as enforceability thereof may be limited under general principles of equity or by applicable bankruptcy, reorganization, insolvency, moratorium or other laws relating to or affecting generally the enforcement of creditors' rights.

3.3 Title to Collateral. Pledgor is the legal and equitable owner of, and has the complete and unconditional authority to pledge, the Collateral and holds the same free and clear of all liens, charges, encumbrances and security interests except those in favor of Services Provider granted hereunder, and will defend its title thereto against the claims of all persons whomsoever.

3.4 Status of Pledged Securities. All of the Pledged Securities are duly authorized, validly issued, fully paid and non-assessable.

3.5 Pledge of Existing Securities and Property. Upon execution and delivery of this Agreement, Pledgor shall deliver to Services Provider certificates evidencing all of the Pledged Securities, accompanied by executed stock powers or other suitable assignments in blank, and by such other instruments or documents as Services Provider or its counsel may reasonably request.

3.6 Pledge of Future Securities and Property. Except as provided in Section 4.1 hereof, Pledgor will cause any additional Pledged Securities or property constituting the Collateral issued to or received by it, whether for value paid by it or otherwise, to be forthwith deposited and pledged with Services Provider, in each case accompanied by instruments of assignment duly executed in blank by Pledgor substantially the same as those required by Section 3.5.

3.7 No Liens or Security Interests. Pledgor will not permit any lien, claim, charge, security interest or encumbrance to exist with respect to the Collateral hereafter, other than those in favor of Services Provider and liens for taxes not yet due and payable.

3.8 Disposition of Collateral. Pledgor will not sell, exchange, hypothecate, pledge, assign, convey, mortgage or abandon any Collateral without Services Provider's prior written consent.

3.9 Payment of Taxes and Charges. Pledgor will pay all taxes, assessments and charges levied, assessed or imposed upon the Collateral before the same become delinquent or become liens upon any of the Collateral except where the same may be contested in good faith by appropriate proceedings and as to which adequate reserves have been provided.

3.10 Further Acts. Pledgor agrees to perform all acts and do all things which Services Provider may request, now or hereafter, to evidence, preserve or protect the creation, attachment or perfection of the security interests herein granted to Services Provider.

3.11 Services Provider's Right to Take Action. In the event that Pledgor fails or refuses to perform any of its obligations set forth herein, Services Provider shall have the right, without obligation, to do all things it deems necessary or advisable to discharge the same, and any sums paid by Services Provider, or the cost thereof, including without limitation, attorneys' fees, shall constitute secured Obligations and be payable, with accrued interest thereon, as provided for in the Release and Assumption Agreement.

3.12 No Obligation by Services Provider. Pledgor acknowledges and agrees that nothing contained herein shall obligate Services Provider or impose a duty upon Services Provider to assume any duties or obligations of Pledgor with respect to any of the Collateral.

4. Dividends, Etc.

4.1 Right to Receive Dividends, Etc. For so long as no Event of Default exists hereunder, Pledgor shall have the right to receive cash dividends declared and paid by PPI with respect to the Collateral. Any and all stock or liquidating dividends, other distributions in property, returns of capital or other distributions made on or in respect of Collateral, whether resulting from a subdivision, combination or reclassification of the outstanding capital stock of PPI, received in exchange for the Collateral or any part thereof or received as a result of any merger, consolidation, acquisition or other exchange of assets to which PPI is a party or otherwise shall be and become part of the Collateral pledged hereunder and, if received by Pledgor, shall forthwith be delivered to Services Provider, to be held subject to the terms of this Agreement.

4.2 Possession of the Collateral, Etc. Services Provider may hold any of the Collateral, endorsed or assigned in blank, and may use the Collateral for the purpose of making denominational exchanges or registrations or transfers or for such other purpose in furtherance of this Agreement as Services Provider may deem desirable.

4.3 Termination of Right to Receive Dividends. Upon the occurrence and during the continuance of any Event of Default, all of Pledgor's rights to receive any cash dividends pursuant to Section 4.1 hereof shall cease, and all such rights shall thereupon become vested in Services Provider, which shall have the sole and exclusive right to receive and retain the dividends which Pledgor would otherwise be authorized to receive and retain pursuant to Section 4.1 hereof. In such event, Pledgor shall pay over to Services Provider any dividends received by Pledgor with respect to the Collateral, and any and all money and other property paid over to or received by Services Provider pursuant to the provisions of this Section 4.3 shall be retained by Services Provider as Collateral hereunder and shall be applied in accordance with the provisions hereof.

5. Voluntary Prepayment; Release of Pledged Securities.

Pledgor shall have the right but not the obligation to prepay, including, but not limited upon, the occurrence of an Event of Default under Section 7 hereof, all or any portion of the principal and interest due on the Note, by delivering to Services Provider cash in an amount equal to the amount of principal and interest thereon being prepaid on the Note, provided that the amount of principal being prepaid on the Note must equal or exceed . Services Provider shall release its security interest in shares of the Pledged Securities in accordance with the formula described herein, and Exhibit "A" shall be amended accordingly.

6. Mandatory Prepayment.

Upon receipt by Pledgor of any cash dividends, distributions and other payments on or with respect to the shares of Common Stock of SHS or any cash proceeds from the sale, transfer or other disposition of shares of Common Stock of SHS, the Note shall be automatically accelerated and Pledgor shall promptly apply the full amount of any such payments and proceeds to prepayment of the Note until such time as the Note is paid in full.

7. Events of Default; Remedies.

7.1 Default. Each of the following shall constitute an Event of Default hereunder:

7.1.1 if any of the Collateral shall be attached or levied upon or seized in any legal proceedings, or held by virtue of any lien or distress;

7.1.2 subject to Section 7.1.3 below, if Pledgor shall materially breach any material covenant, representation or warranty set forth herein or in the Note;

7.1.3 the occurrence of any event of default under the Note.

7.2 Services Provider's Rights and Remedies. Upon the occurrence of any Event of Default and during the continuance thereof:

7.2.1 Services Provider shall thereupon have the rights and remedies of a secured party under the Uniform Commercial Code of the State of California and may apply dividends to the Obligations and sell the remaining Collateral as appropriate.

7.2.2 Services Provider agrees to give written notice to Pledgor prior to disposition of the Collateral as described herein, and the proceeds of any such sale or disposition shall be applied to attorneys' fees, costs and then to the Obligations.

7.2.3 Restrictions Imposed by Securities Laws. Pledgor understands that compliance with the Securities Laws may limit the disposition of the Pledged Securities, including private placement or sale only to purchasers for investment purposes.

8. Power of Attorney.

Pledgor appoints Services Provider, or any other person whom Services Provider may designate, as Pledgor's attorney-in-fact, with power to endorse Pledgor's name on any checks, notes, acceptances, money orders, drafts or other form of payment or security representing a portion of the Collateral that may come into Services Provider's possession and to do all things necessary to carry out this Agreement.

9. Termination of Agreement.

This Agreement shall continue in full force and effect until all Obligations have been fully paid and satisfied. Upon termination of this Agreement, Services Provider shall surrender to Pledgor or other person legally entitled thereto, without recourse or warranty, all certificates evidencing and stock powers and other assignments in respect of the Pledged Securities and any other properties included in the Collateral which are in the possession of Services Provider and have not been disposed of pursuant to Section 7.2 hereof.

10. Waivers, Amendments, Successors and Assigns.

10.1 Waiver of Demand, Presentment and Notice. Pledgor waives demand, presentment and protest of any instrument and notice thereof, notice of default and all other notices to which Pledgor might otherwise be entitled, except as otherwise specifically provided herein or in the Release and Assumption Agreement.

10.2 Failure by Services Provider to exercise any right, remedy or option under this Agreement or in any other agreement between the parties hereto, or delay by Services Provider in exercising the same, will not operate as a waiver thereof.

10.3 No waiver by Services Provider will be effective unless it is in a writing signed by Services Provider, and then only to the extent specifically stated.

10.4 Services Provider's rights and remedies under this Agreement will be cumulative and not exclusive of any other right or remedy which Services Provider may have.

10.5 This Agreement cannot be changed or terminated orally.

10.6 Services Provider shall have the right to assign this Agreement and to transfer, assign or sell participations in its interests hereunder, but Pledgor shall not be permitted to assign this Agreement or any interest herein.

10.7 All of the rights, privileges, remedies and options given to Services Provider hereunder shall inure to the benefit of its successors and assigns and bind the successors and assigns of Services Provider and Pledgor.

11. General Provisions.

11.1 Pledgor agrees to do such further acts and things, and to execute and deliver such additional conveyances, assignments, agreements and instruments, as Services Provider may reasonably request in connection with this Agreement or relative to the Collateral.

11.2 Section headings used herein are for convenience only and are not to affect the construction of or be taken into consideration in interpreting this Agreement.

11.3 Wherever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law.

11.4 If Pledgor fails to pay any taxes, assessments or governmental charges, Services Provider may pay same and the amounts so paid shall be added to the Obligations.

11.5 Choice of Law.

It is the intention of the parties hereto that the internal laws of the State of California, U.S.A. shall govern the validity of this Agreement, the construction of its terms, and the interpretation and enforcement of the rights and duties of the parties hereto.

11.6 Pledgor covenants, warrants and represents to Services Provider that all of Pledgor's representations and warranties contained in this Agreement shall be true at the time of execution and shall survive until termination.

11.7 No termination or cancellation of the Release and Assumption Agreement or the Note shall in any way affect the parties' rights and obligations with respect to the Collateral or any prior transactions.

11.8 Services Provider may, in its sole discretion, exchange, enforce, waive or release any security or portion of the Collateral and apply proceeds as it determines.

11.9 Services Provider shall have the continuing and exclusive right to apply or reverse and reapply any and all payments to any portion of the Obligations.

11.10 Pledgor agrees that, in the event of nonperformance, Services Provider shall be entitled to temporary and permanent injunctive relief without proving actual damages.

11.11 Notices. All notices shall be in writing and delivered in accordance with the terms stated herein.

11.12 Pledgor agrees to indemnify Services Provider from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature whatsoever.

11.13 This Agreement may be executed in any number of counterparts, each of which shall be an original and all of which together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first hereinabove written.