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Exhibit 10.1
 
EXECUTION COPY 
 

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AMCOL INTERNATIONAL CORPORATION
 
 
 
 
 
 
 
$50,000,000 5.46% Guaranteed Senior Notes,
due April 29, 2020
 
 
 
________________
 
NOTE PURCHASE AGREEMENT
________________
 
 
 
 
 
 
Dated as of APRIL 29, 2010
 
 
 
 
 

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TABLE OF CONTENTS
                        
 SECTION                                                          HEADING 
PAGE    
SECTION 1. Authorization of Notes
1
   
SECTION 2. Sale and Purchase of Notes; Subsidiary Guaranty
1
 
 
     Section 2.1      Sale and Purchase of Notes
1
   
     Section 2.2      Subsidiary Guaranty
1
   
SECTION 3. Closing
2
   
SECTION 4. Conditions to Closing
2
   
     Section 4.1     Representations and Warranties
2
   
     Section 4.2      Performance; No Default
3
   
     Section 4.3      Compliance Certificates.
3
   
     Section 4.4      Opinions of Counsel
3
   
     Section 4.5      Purchase Permitted By Applicable Law, Etc
4
   
     Section 4.6      Sale of Other Notes
4
   
     Section 4.7      Payment of Special Counsel Fees
4
   
     Section 4.8      Private Placement Number
4
   
     Section 4.9      Changes in Corporate Structure
4
   
     Section 4.10     Subsidiary Guaranty
4
   
     Section 4.11     Funding Instructions
4
   
     Section 4.12     Proceedings and Documents .
4
   
SECTION 5. Representations and Warranties of the Company
5
 
 
     Section 5.1      Organization; Power and Authority
5
   
     Section 5.2      Authorization, Etc
5
   
     Section 5.3      Disclosure
5
   
     Section 5.4      Organization and Ownership of Shares of Subsidiaries;
Affiliates
6     
     Section 5.5      Financial Statements; Material Liabilities
7
   
     Section 5.6      Compliance with Laws, Other Instruments, Etc
7
   
     Section 5.7      Governmental Authorizations, Etc
7
   
     Section 5.8      Litigation; Observance of Agreements, Statutes and Orders
7
   
     Section 5.9      Taxes
8
   
     Section 5.10   Title to Property; Leases
8

 
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 TABLE OF CONTENTS
(continued)
SECTION                                                         HEADING
 PAGE
 
 
     Section 5.11      Licenses, Permits, Etc
  8
   
     Section 5.12      Compliance with ERISA
  9
   
     Section 5.13      Private Offering by the Company
 10
   
     Section 5.14      Use of Proceeds; Margin Regulations
 10
   
     Section 5.15       Existing Debt; Future Liens
 10
   
     Section 5.16      Foreign Assets Control Regulations, Etc
 11
   
     Section 5.17      Status under Certain Statutes
 11
   
     Section 5.18      Environmental Matters
 11
   
     Section 5.19      Notes Rank Pari Passu
 12
   
SECTION 6. Representations of the Purchasers
 12
   
     Section 6.1      Purchase for Investment
 12
   
     Section 6.2      Accredited Investor
 12
   
     Section 6.3      Source of Funds
 13
   
SECTION 7. Information as to Company
 14
   
     Section 7.1      Financial and Business Information
 14
   
     Section 7.2       Officer’s Certificate
 17
   
     Section 7.3       Visitation
 17
   
SECTION 8. Payment of the Notes
 18
   
     Section 8.1      Required Prepayments; Maturity
 18
   
     Section 8.2      Optional Prepayments
 18
   
     Section 8.3      Allocation of Partial Prepayments
 18
   
     Section 8.4      Maturity; Surrender, Etc
 19
   
     Section 8.5      Purchase of Notes
 19
   
     Section 8.6      Offer to Prepay Upon Sale of Assets
 19
   
     Section 8.7      Offer to Prepay in the Event of a Change in Control
 20
   
     Section 8.8      Make-Whole Amount
 22
   
SECTION 9. Affirmative Covenants
 23
   
     Section 9.1      Compliance with Law
 23
   
     Section 9.2      Insurance
 23
   
     Section 9.3      Maintenance of Properties
 24

 
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TABLE OF CONTENTS
(continued)
 
SECTION                                                                HEADING
 PAGE
 
 
     Section 9.4      Payment of Taxes and Claims
 24
   
     Section 9.5      Corporate Existence, Etc
 24
   
     Section 9.6      Notes and Subsidiary Guaranty to Rank Pari Passu
 24
   
     Section 9.7      Books and Records
 25
   
     Section 9.8      Designation of Subsidiaries
 25
   
     Section 9.9      Additional Subsidiary Guarantors
 25
   
SECTION 10. Negative Covenants
 26
   
     Section 10.1    Consolidated Debt to Consolidated EBITDA
 26
   
     Section 10.2     Priority Debt
 27
   
     Section 10.3     Limitation on Liens
 27
   
     Section 10.4     Merger and Consolidation.
 29
   
     Section 10.5     Sales of Assets
 30
   
     Section 10.6     Transactions with Affiliates
 30
   
     Section 10.7      Line of Business
 31
   
     Section 10.8     Terrorism Sanctions Regulations
 31
   
     Section 10.9     Limitation on Unrestricted Subsidiaries
 31
   
SECTION 11. Events of Default
 31
   
SECTION 12. Remedies on Default, Etc
 34
   
     Section 12.1     Acceleration
 34
   
     Section 12.2     Other Remedies
 34
   
     Section 12.3     Rescission
 34
   
     Section 12.4     No Waivers or Election of Remedies, Expenses, Etc
 35
   
SECTION 13. Registration; Exchange; Substitution of Notes
 35
   
     Section 13.1     Registration of Notes
 35
   
     Section 13.2     Transfer and Exchange of Notes
 35
   
     Section 13.3     Replacement of Notes
 36
   
SECTION 14. Payments on Notes
 36
   
     Section 14.1     Place of Payment
 36
   
     Section 14.2     Home Office Payment
 36
   
SECTION 15. Expenses, Etc
 37

 
 
 
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 TABLE OF CONTENTS
(continued)
   
SECTION                                                                                   
 HEADING
 PAGE
 
 
     Section 15.1     Transaction Expenses
 37
   
     Section 15.2     Survival
 37
   
SECTION 16. Survival of Representations and Warranties; Entire Agreement
 37
   
SECTION 17. Amendment and Waiver
 38
   
     Section 17.1     Requirements
 38
   
     Section 17.2     Solicitation of Holders of Notes
 38
   
     Section 17.3     Binding Effect, Etc
 39
   
     Section 17.4     Notes Held by Company, Etc
 39
   
SECTION 18. Notices
 39
   
SECTION 19. Reproduction of Documents
 40
   
SECTION 20. Confidential Information
 40
   
SECTION 21. Substitution of Purchaser
 41
   
SECTION 22. Miscellaneous
 41
   
     Section 22.1    Successors and Assigns
 41
   
     Section 22.2     Payments Due on Non-Business Days
 41
   
     Section 22.3     Accounting Terms
 42
   
     Section 22.4     Severability
 42
   
     Section 22.5     Construction
 42
   
     Section 22.6     Counterparts
 42
   
     Section 22.7     Governing Law
 42
   
     Section 22.8     Jurisdiction and Process; Waiver of Jury Trial
 43

 
 
 
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 ATTACHMENTS TO THE NOTE PURCHASE AGREEMENT:              SCHEDULE A  —
 Information Relating to Purchasers       SCHEDULE B  —  Defined Terms      
 SCHEDULE 5.4  —  Subsidiaries of the Company and Ownership of Subsidiary Stock
       SCHEDULE 5.5  —  Financial Statements        SCHEDULE 5.15  —  Existing
Debt        SCHEDULE 10.3  —  Existing Liens        EXHIBIT 1  —  Form of 5.46%
Guaranteed Senior Note, due April 29, 2020        EXHIBIT 4.4(a)  —  Form of
Opinion of Special Counsel to the Company and the Subsidiary Guarantors      
 EXHIBIT 4.4(b)  —  Form of Opinion of Special Counsel to the Purchasers      
 EXHIBIT SG  —  Form of Subsidiary Guaranty

 
 
 
 
 
 
 
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AMCOL INTERNATIONAL CORPORATION
2870 Forbs Avenue
Hoffman Estates, Illinois 60192
 
 
$50,000,000 5.46% Guaranteed Senior Notes, due April 29, 2020
 
 
 

   Dated as of    April 29, 2010

 
TO THE PURCHASERS LISTED IN
THE ATTACHED SCHEDULE A:
 
Ladies and Gentlemen:
 
    AMCOL INTERNATIONAL CORPORATION, a Delaware corporation (the “Company”),
agrees with the Purchasers listed in the attached Schedule A (the “Purchasers”)
to this Note
Purchase Agreement (this “Agreement”) as follows:
 
SECTION 1. AUTHORIZATION OF NOTES.
 
    The Company will authorize the issue and sale of $50,000,000 aggregate
principal amount of its 5.46% Guaranteed Senior Notes, due April 29, 2020 (the
“Notes,” such term shall also include any such notes issued in substitution
therefor pursuant to Section 13). The Notes shall be substantially in the form
set out in Exhibit 1, with such changes therefrom, if any, as may be approved by
the Purchasers and the Company. Certain capitalized and other terms used in this
Agreement are defined in Schedule B; and references to a “Schedule” or an
“Exhibit” are, unless otherwise specified, to a Schedule or an Exhibit attached
to this Agreement.
 
SECTION 2. SALE AND PURCHASE OF NOTES; SUBSIDIARY GUARANTY.
 
    Section 2.1 Sale and Purchase of Notes. Subject to the terms and conditions
of this Agreement, the Company will issue and sell to each Purchaser and each
Purchaser will purchase from the Company, on the Closing Date provided for in
Section 3, the Notes in the principal amount specified opposite such Purchaser’s
name in Schedule A at the purchase price of 100% of the principal amount
thereof. The obligations of each Purchaser hereunder are several and not joint
obligations and no Purchaser shall have any obligation or any liability to any
Person for the performance or nonperformance by any other Purchaser hereunder.
 
    Section 2.2 Subsidiary Guaranty.
 

 

        (a) The payment by the Company of all amounts due with respect to the
Notes and the performance by the Company of its obligations under this Agreement
will be absolutely and unconditionally  guaranteed by the Subsidiary Guarantors
pursuant to the Subsidiary Guaranty Agreement dated as of April 29, 2010, which
shall be substantially in the form of Exhibit SG (the “Subsidiary Guaranty”).

 
 

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        (b) The holders of the Notes agree to discharge and release any
Subsidiary Guarantor from the Subsidiary Guaranty upon the written request of
the Company (a “Collateral Release”), provided that (1) such Subsidiary
Guarantor has been released and discharged (or will be released and discharged
concurrently with the release of such Subsidiary Guarantor under the Subsidiary
Guaranty) as an obligor, co-obligor and guarantor under and in respect of the
Bank Credit Agreement and the Company so certifies to the holders of the Notes
in a certificate of a Responsible Officer, (2) at the time of such release and
discharge, the Company shall deliver a certificate of a Responsible Officer to
the holders of the Notes stating that no Default or Event of Default shall have
occurred and be continuing or will result from such release and discharge and
(3) if any fee or other form of consideration is given to any holder of Debt of
the Company, including, without limitation, any party to the Bank Credit
Agreement, expressly for the purpose of such release, the holders of the Notes
shall receive equivalent consideration.

 
 
SECTION 3. CLOSING.
 
    The sale and purchase of the Notes to be purchased by each Purchaser shall
occur at the offices of Schiff Hardin LLP, 900 Third Avenue, 23rd Floor, New
York, New York 10022 at 11:00 a.m. New York, New York time, at a closing on
April 29, 2010 or on such other Business Day thereafter as may be agreed upon by
the Company and the Purchasers (the “Closing Date”). On the Closing Date, the
Company will deliver to each Purchaser the Notes to be purchased by such
Purchaser in the form of a single Note (or such greater number of Notes in
denominations of at least $100,000 as such Purchaser may request) dated the
Closing Date and registered in such Purchaser’s name (or in the name of its
nominee), against delivery by such Purchaser to the Company or its order of
immediately available funds in the amount of the purchase price therefor by wire
transfer of immediately available funds for the account of the Company in
compliance with the funding instructions described in Section 4.10. If, on the
Closing Date, the Company shall fail to tender such Notes to any Purchaser as
provided above in this Section 3, or any of the conditions specified in Section
4 shall not have been fulfilled to any Purchaser’s satisfaction, such Purchaser
shall, at its election, be relieved of all further obligations under this
Agreement, without thereby waiving any rights such Purchaser may have by reason
of such failure or such nonfulfillment.
 
SECTION 4. CONDITIONS TO CLOSING.
 
    Each Purchaser’s obligation to purchase and pay for the Notes to be sold to
such Purchaser on the Closing Date is subject to the fulfillment to such
Purchaser’s satisfaction, prior to or on the Closing Date, of the following
conditions:
 
    Section 4.1 Representations and Warranties.
 

        (a) Representations and Warranties of the Company. The representations
and warranties of the Company in this Agreement shall be correct when made and
on the Closing Date.

 
 
 
 
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       (b) Representations and Warranties of the Subsidiary Guarantors. The
representations and warranties of the Subsidiary Guarantors in the Subsidiary
Guaranty shall be correct when made and on the Closing Date.

 
 
    Section 4.2 Performance; No Default. The Company and each Subsidiary
Guarantor shall have performed and complied with all agreements and conditions
contained in this
Agreement and the Subsidiary Guaranty required to be performed or complied with
by the Company and each Subsidiary Guarantor prior to or on the Closing Date,
and immediately after
giving effect to the issue and sale of the Notes (and the application of the
proceeds thereof as contemplated by Section 5.14), no Default or Event of
Default shall have occurred and be
continuing. Neither the Company nor any Subsidiary shall have entered into any
transaction since March 22, 2010 that would have been prohibited by Sections
10.3, 10.4, 10.5 or 10.6 had
such Section applied since such date.
 
    Section 4.3 Compliance Certificates.
 

       (a) Officer’s Certificate of the Company. The Company shall have
delivered to such Purchaser an Officer’s Certificate, dated the Closing Date,
certifying that the conditions specified in Sections 4.1, 4.2 and 4.9 have been
fulfilled.            (b) Secretary’s Certificate of the Company. The Company
shall have delivered to such Purchaser a certificate of its Secretary or an
Assistant Secretary, dated the Closing Date, certifying as to the resolutions
attached thereto and other corporate proceedings relating to the authorization,
execution and delivery of the Notes and this Agreement.             (c)
Officer’s Certificate of the Subsidiary Guarantors. Each Subsidiary Guarantor
shall have delivered to such Purchaser an Officer’s Certificate, dated the
Closing Date, certifying that the conditions specified in Sections 4.1(b), 4.2
and 4.9 have been fulfilled.            (d) Secretary’s Certificate of the
Subsidiary Guarantors. Each Subsidiary Guarantor shall have delivered to such
Purchaser a certificate of its Secretary or an Assistant Secretary, dated the
Closing Date, certifying as to the resolutions attached thereto and other
corporate or other proceedings relating to the authorization, execution and
delivery of the Subsidiary Guaranty.    

 
    Section 4.4 Opinions of Counsel. Such Purchaser shall have received opinions
in form and substance satisfactory to such Purchaser, dated the Closing Date (a)
from Locke Lord
Bissell & Liddell LLP, special counsel for the Company and the Subsidiary
Guarantors, covering the matters set forth in Exhibit 4.4(a) and covering such
other matters incident to the
transactions contemplated hereby as such Purchaser or special counsel to the
Purchasers may reasonably request (and the Company hereby instructs its counsel
to deliver such opinion to the
Purchasers) and (b) from Schiff Hardin LLP, special counsel to the Purchasers in
connection with such transactions, substantially in the form set forth in
Exhibit 4.4(b) and covering such
other matters incident to such transactions as such Purchaser may reasonably
request.
 
 
 
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    Section 4.5 Purchase Permitted By Applicable Law, Etc. On the Closing Date,
such Purchaser’s purchase of Notes shall (a) be permitted by the laws and
regulations of each jurisdiction to which such Purchaser is subject, without
recourse to provisions (such as Section 1405(a)(8) of the New York Insurance
Law) permitting limited investments by insurance companies without restriction
as to the character of the particular investment, (b) not violate any applicable
law or regulation (including, without limitation, Regulation T, U or X of the
Board of Governors of the Federal Reserve System) and (c) not subject such
Purchaser to any tax, penalty or liability under or pursuant to any applicable
law or regulation. If requested by such Purchaser, such Purchaser shall have
received an Officer’s Certificate from the Company certifying as to such matters
of fact as such Purchaser may reasonably specify to enable such Purchaser to
determine whether such purchase is so permitted.
 
    Section 4.6 Sale of Other Notes. On the Closing Date, the Company shall sell
to each other Purchaser and each other Purchaser shall purchase the Notes to be
purchased by it on the Closing Date as specified in Schedule A.
 
    Section 4.7 Payment of Special Counsel Fees. Without limiting the provisions
of Section 15.1, the Company shall have paid on or before the Closing Date, the
reasonable fees, reasonable charges and reasonable disbursements of special
counsel to the Purchasers referred to in Section 4.4(b) to the extent reflected
in a statement of such counsel rendered to the Company at least one Business Day
prior to the Closing Date.
 
    Section 4.8 Private Placement Number. A Private Placement Number issued by
Standard & Poor’s CUSIP Service Bureau (in cooperation with the SVO) shall have
been obtained for the Notes.
 
    Section 4.9 Changes in Corporate Structure. Neither the Company nor any
Subsidiary Guarantor shall have changed its jurisdiction of incorporation or
been a party to any merger or consolidation, or shall have succeeded to all or
any substantial part of the liabilities of any other entity, at any time
following the date of the most recent financial statements referred to in
Schedule 5.5.
 
    Section 4.10 Subsidiary Guaranty. The Subsidiary Guaranty shall have been
duly authorized, executed and delivered by each Subsidiary Guarantor, shall
constitute the legal, valid and binding contract and agreement of each
Subsidiary Guarantor and such Purchaser shall have received a true, correct and
complete copy thereof.
 
    Section 4.11 Funding Instructions. At least three Business Days prior to the
Closing Date, such Purchaser shall have received written instructions signed by
a Responsible Officer on letterhead of the Company directing the manner of the
payment of funds and setting forth (a) the name and address of the transferee
bank, (b) such transferee bank’s ABA number and (c) the account name and number
into which the purchase price for the Notes is to be deposited.
 
    Section 4.12 Proceedings and Documents. All corporate and other
organizational proceedings in connection with the transactions contemplated by
this Agreement and the Subsidiary Guaranty and all documents and instruments
incident to such transactions shall be satisfactory to such Purchaser and
special counsel to the Purchasers, and such Purchaser and special counsel to the
Purchasers shall have received all such counterpart originals or certified or
other copies of such documents as such Purchaser or special counsel to the
Purchasers may reasonably request.
 
 
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SECTION 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
 
    The Company represents and warrants to each Purchaser that:
 
    Section 5.1 Organization; Power and Authority. The Company is a corporation
duly organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and is duly qualified as a foreign corporation
and is in good standing in each jurisdiction in which such qualification is
required by law, other than those jurisdictions as to which the failure to be so
qualified or in good standing would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. The Company has the
corporate power and authority to own or hold under lease the properties it
purports to own or hold under lease, to transact the business it transacts and
proposes to transact, to execute and deliver this Agreement and the Notes and to
perform the provisions hereof and thereof.
 
    Section 5.2 Authorization, Etc.
 

 

        (a) This Agreement and the Notes to be issued on the Closing Date have
been duly authorized by all necessary corporate action on the part of the
Company, and this Agreement constitutes, and upon execution and delivery thereof
each such Note will constitute, a legal, valid and binding obligation of the
Company enforceable against the Company in accordance with its terms, except as
such enforceability may be limited by (1) applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors’ rights generally and (2) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity
or at law).
           (b) The Subsidiary Guaranty has been duly authorized by all necessary
corporate or other action on the part of each Subsidiary Guarantor and the
Subsidiary Guaranty constitutes a legal, valid and binding obligation of each
Subsidiary Guarantor enforceable against each Subsidiary Guarantor in accordance
with its terms, except as such enforceability may be limited by (1) applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors’ rights generally and (2) general
principles of equity (regardless of whether such enforceability is considered in
a proceeding in equity or at law).

 
    Section 5.3 Disclosure. This Agreement, the documents, certificates or other
writings delivered to the Purchasers by or on behalf of the Company in
connection with the transactions contemplated hereby and the financial
statements listed in Schedule 5.5 (this Agreement, such documents, certificates
or other writings and such financial statements delivered to each Purchaser
prior to March 22, 2010, being referred to, collectively, as the “Disclosure
Documents”), taken as a whole, do not contain any untrue statement of a material
fact or omit to state any material fact necessary to make the statements therein
not misleading in light of the circumstances under which they were made. Except
as disclosed in the Disclosure Documents, since December 31, 2009, there has
been no change in the financial condition, operations, business or properties of
the Company or any Restricted Subsidiary except changes that, individually or in
the aggregate, would not reasonably be expected to have a Material Adverse
Effect. There is no fact known to a Responsible Officer that would reasonably be
expected to have a Material Adverse Effect that has not been set forth herein or
in the Disclosure Documents; provided that this representation shall not include
any facts (a) that relate to the industry in which the Company or any Restricted
Subsidiary participates generally or (b) that relate to general economic
conditions.
 
 
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Section 5.4 Organization and Ownership of Shares of Subsidiaries; Affiliates.
  
 

        (a) Schedule 5.4 contains (except as noted therein) complete and correct
lists of (1) the Company's Restricted and Unrestricted Subsidiaries, showing, as
to each Subsidiary, the correct name thereof, the jurisdiction of its
organization and the percentage of shares of each class of its capital stock or
similar equity interests outstanding owned by the Company and each other
Subsidiary, (2) the Company's known Affiliates, other than Subsidiaries and (3)
the Company's directors and executive officers.             (b) All of the
outstanding shares of capital stock or similar equity interests of each
Subsidiary shown in Schedule 5.4 as being owned by the Company and its
Subsidiaries have been validly issued, are fully paid and nonassessable and are
owned by the Company or another Subsidiary free and clear of any Lien (except as
otherwise disclosed in Schedule 5.4).             (c) Each Subsidiary identified
in Schedule 5.4 is a corporation or other legal entity duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization, and is duly qualified as a foreign corporation or other legal
entity and is in good standing in each jurisdiction in which such qualification
is required by law, other than those jurisdictions as to which the failure to be
so qualified or in good standing would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. Each such Subsidiary
has the corporate or other power and authority to own or hold under lease the
properties it purports to own or hold under lease and to transact the business
it transacts and proposes to transact and, in the case of each Subsidiary that
is a Subsidiary Guarantor, to execute and deliver the Subsidiary Guaranty and to
perform the provisions thereof.             (d) No Subsidiary is a party to, or
otherwise subject to, any legal, regulatory, contractual or other restriction
(other than this Agreement, the agreements listed on Schedule 5.4 and customary
limitations imposed by corporate law or similar statutes) restricting the
ability of such Subsidiary to pay dividends out of profits or make any other
similar distributions of profits to the Company or any other Subsidiary that
owns outstanding shares of capital stock or similar equity interests of such
Subsidiary.    

 
 
6

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    Section 5.5 Financial Statements; Material Liabilities. The Company has
delivered to each Purchaser copies of the financial statements of the Company
and its Subsidiaries listed on Schedule 5.5. All of said financial statements
(including in each case the related schedules and notes) fairly present, in all
material respects, the consolidated financial position of the Company and its
Subsidiaries as of the respective dates specified in such Schedule and the
consolidated results of their operations and cash flows for the respective
periods so specified and have been prepared in accordance with GAAP consistently
applied throughout the periods involved except as set forth in the notes thereto
(subject, in the case of any interim financial statements, to normal year-end
adjustments). The Company and its Subsidiaries do not have any Material
liabilities that are not disclosed on such financial statements or otherwise
disclosed in the Disclosure Documents.

    Section 5.6 Compliance with Laws, Other Instruments, Etc. The execution,
delivery and performance by the Company of this Agreement and the Notes and the
execution, delivery and performance by each Subsidiary Guarantor of the
Subsidiary Guaranty will not (a) contravene, result in any breach of, or
constitute a default under, or result in the creation of any Lien in respect of
any property of the Company or any Subsidiary under, any indenture, mortgage,
deed of trust, loan, purchase or credit agreement, lease, corporate charter or
by-laws, or any other agreement or instrument to which the Company or any
Subsidiary is bound or by which the Company or any Subsidiary or any of their
respective properties may be bound or affected, (b) conflict with or result in a
breach of any of the terms, conditions or provisions of any order, judgment,
decree or ruling of any court, arbitrator or Governmental Authority applicable
to the Company or any Subsidiary or (c) violate any provision of any statute or
other rule or regulation of any Governmental Authority applicable to the Company
or any Subsidiary.

    Section 5.7 Governmental Authorizations, Etc. No consent, approval or
authorization of, or registration, filing or declaration with, any Governmental
Authority is required to be made or obtained by the Company or any Subsidiary in
connection with the execution, delivery or performance by (a) the Company of
this Agreement or the Notes or (b) any Subsidiary Guarantor of the Subsidiary
Guaranty.

   Section 5.8 Litigation; Observance of Agreements, Statutes and Orders.
 

       (a) There are no actions, suits, investigations or proceedings pending
or, to the knowledge of the Company, threatened against or affecting the Company
or any Restricted Subsidiary or any property of the Company or any Restricted
Subsidiary in any court or before any arbitrator of any kind or before or by any
Governmental Authority that, individually or in the aggregate, would reasonably
be expected to have a Material Adverse Effect.            (b) Neither the
Company nor any Restricted Subsidiary is in default under any term of any
agreement or instrument to which it is a party or by which it is bound, or any
order, judgment, decree or ruling of any court, arbitrator or Governmental
Authority or is in violation of any applicable law, ordinance, rule or
regulation (including, without limitation, Environmental Laws, ERISA or the USA
Patriot Act) of any Governmental Authority, which default or violation,
individually or in the aggregate, would reasonably be expected to have a
Material Adverse Effect.    

 
 
 
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   Section 5.9 Taxes. The Company and its Subsidiaries have filed all tax
returns that are required to have been filed in any jurisdiction, and have paid
all taxes shown to be due and payable on such returns and all other taxes and
assessments levied upon them or their properties, assets, income or franchises,
to the extent such taxes and assessments have become due and payable and before
they have become delinquent, except for any taxes and assessments (a) the amount
of which is not, individually or in the aggregate, Material or (b) the amount,
applicability or validity of which is currently being contested in good faith by
appropriate proceedings and with respect to which the Company or a Subsidiary,
as the case may be, has established adequate reserves in accordance with GAAP.
The Company knows of no basis for any other tax or assessment that would
reasonably be expected to have a Material Adverse Effect. The charges, accruals
and reserves on the books of the Company and its Subsidiaries in respect of
federal, state or other taxes for all fiscal periods are adequate. The federal
income tax liabilities of the Company and its Subsidiaries have been finally
determined (whether by reason of completed audits or the statute of limitations
having run) for all fiscal years up to and including the fiscal year ended
December 31, 2007.

   Section 5.10 Title to Property; Leases. The Company and its Restricted
Subsidiaries have good and sufficient title to their respective properties which
the Company and its Restricted Subsidiaries own or purport to own that,
individually or in the aggregate, are Material, including all such properties
reflected in the most recent audited balance sheet referred to in Section 5.5 or
purported to have been acquired by the Company or any Restricted Subsidiary
after said date (except as sold or otherwise disposed of in the ordinary course
of business), in each case free and clear of Liens prohibited by this Agreement.
All leases that, individually or in the aggregate, are Material are valid and
subsisting and are in full force and effect in all material respects.

   Section 5.11 Licenses, Permits, Etc.
 

       (a) The Company and its Restricted Subsidiaries own or possess all
licenses, permits, franchises, authorizations, patents, copyrights, proprietary
software, service marks, trademarks, trade names and domain names, or rights
thereto, that, individually or in the aggregate, are Material, without known
conflict with the rights of others.             (b) To the best knowledge of the
Company, no product of the Company or any of its Restricted Subsidiaries
infringes in any material respect any license, permit, franchise, authorization,
patent, copyright, proprietary software, service mark, trademark, trade name,
domain name or other right owned by any other Person.             (c) To the
best knowledge of the Company, there is no Material violation by any Person of
any right of the Company or any of its Restricted Subsidiaries with respect to
any patent, copyright, proprietary software, service mark, trademark, trade
name, domain name or other right owned or used by the Company or any of its
Restricted Subsidiaries.    

 
 
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    Section 5.12 Compliance with ERISA.
 

       (a) The Company and each ERISA Affiliate have operated and administered
each Plan in compliance with all applicable laws except for such instances of
noncompliance as have not resulted in, and would not reasonably be expected to
result in, a Material Adverse Effect. Neither the Company nor any ERISA
Affiliate has incurred any liability pursuant to Title I or IV of ERISA or the
penalty or excise tax provisions of the Code relating to employee benefit plans
(as defined in Section 3 of ERISA), and no event, transaction or condition has
occurred or exists that would reasonably be expected to result in the incurrence
of any such liability by the Company or any ERISA Affiliate, or in the
imposition of any Lien on any of the rights, properties or assets of the Company
or any ERISA Affiliate, in either case pursuant to Title I or IV of ERISA or to
such penalty or excise tax provisions or to Section 412 or Section 430 of the
Code or Section 4068 of ERISA, other than such liabilities or Liens as would not
be, individually or in the aggregate, Material.            (b) The present value
of the aggregate benefit liabilities under each of the Plans (other than
Multiemployer Plans), determined as of the end of such Plan's most recently
ended plan year on the basis of the actuarial assumptions specified for funding
purposes in such Plan's most recent actuarial valuation report, did not exceed
the aggregate current value of the assets of such Plan allocable to such benefit
liabilities. The term "benefit liabilities" has the meaning specified in Section
4001 of ERISA and the terms "current value" and "present value" have the
meanings specified in Section 3 of ERISA.            (c) The Company and its
ERISA Affiliates have not incurred any withdrawal liabilities (and are not
subject to contingent withdrawal liabilities) under Section 4201 or 4204 of
ERISA in respect of Multiemployer Plans that, individually or in the aggregate,
are Material.            (d) The expected post-retirement benefit obligation
(determined as of the last day of the Company's most recently ended fiscal year
in accordance with Financial Accounting Standards Board Statement No. 106,
without regard to liabilities attributable to continuation coverage mandated by
Section 4980B of the Code) of the Company and its Subsidiaries is not Material.
           (e) The execution and delivery of this Agreement and the issuance and
sale of the Notes hereunder to each Purchaser will not involve any transaction
with respect to such Purchaser that is subject to the prohibitions of Section
406 of ERISA or in connection with which a tax would be imposed pursuant to
Section 4975(c)(1)(A)-(D) of the Code. The representation by the Company to each
Purchaser in the first sentence of this Section 5.12(e) is made in reliance upon
and subject to the accuracy of such Purchaser's representation in Section 6.3 as
to the sources of the funds to be used to pay the purchase price of the Notes to
be purchased by such Purchaser.

 
  
 
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   Section 5.13 Private Offering by the Company. Neither the Company nor anyone
acting on the Company's behalf has offered the Notes, the Subsidiary Guaranty or
any similar securities for sale to, or solicited any offer to buy any of the
same from, or otherwise approached or negotiated in respect thereof with, any
Person other than the Purchasers, each of which has been offered the Notes and
the Subsidiary Guaranty in connection with a private sale for investment.
Neither the Company nor anyone acting on the Company's behalf has taken, or will
take, any action that would subject the issuance or sale of the Notes or the
Subsidiary Guaranty to the registration requirements of Section 5 of the
Securities Act or to the registration requirements of any securities or blue sky
laws of any applicable jurisdiction. The representation by the Company in the
preceding sentence is made in reliance upon and subject to the accuracy of the
Purchasers' representations in Sections 6.1 and Section 6.2.

   Section 5.14 Use of Proceeds; Margin Regulations. The Company will apply the
proceeds of the sale of the Notes to refinance existing indebtedness and for
other general corporate purposes of the Company. No part of the proceeds from
the sale of the Notes hereunder will be used, directly or indirectly, for the
purpose of buying or carrying any margin stock within the meaning of Regulation
U of the Board of Governors of the Federal Reserve System (12 CFR 221), or for
the purpose of buying or carrying or trading in any securities under such
circumstances as to involve the Company in a violation of Regulation X of said
Board (12 CFR 224) or to involve any broker or dealer in a violation of
Regulation T of said Board (12 CFR 220). Margin stock does not constitute more
than 10% of the value of the consolidated total assets of the Company and its
Subsidiaries and the Company does not have any present intention that margin
stock will constitute more than 10% of the value of such assets. As used in this
Section, the terms "margin stock" and "purpose of buying or carrying" shall have
the meanings assigned to them in said Regulation U.

   Section 5.15 Existing Debt; Future Liens.
 

        (a) Except as described therein, Schedule 5.15 sets forth a complete and
correct list of all outstanding Debt of the Company and its Restricted
Subsidiaries as of December 31, 2009 (including a description of the obligors
and obligees, principal amount outstanding and collateral therefor, if any, and
Guaranty thereof, if any), since which date there has been no Material change in
the amounts, interest rates, sinking funds, installment payments or maturities
of the Debt of the Company or its Restricted Subsidiaries. Neither the Company
nor any Restricted Subsidiary is in default and no waiver of default is
currently in effect, in the payment of any principal or interest on any Debt of
the Company or such Restricted Subsidiary, and no event or condition exists with
respect to any Debt of the Company or any Restricted Subsidiary, that would
permit (or that with notice or the lapse of time, or both, would permit) one or
more Persons to cause such Debt to become due and payable before its stated
maturity or before its regularly scheduled dates of payment.            (b)
Except as disclosed in Schedule 5.15, neither the Company nor any Restricted
Subsidiary has agreed or consented to cause or permit in the future (upon the
happening of a contingency or otherwise) any of its property, whether now owned
or hereafter acquired, to be subject to a Lien not permitted by Section 10.3.  
 

 
  

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       (c) Neither the Company nor any Subsidiary is a party to, or otherwise
subject to any provision contained in, any instrument evidencing Debt of the
Company or such Subsidiary, any agreement relating thereto or any other
agreement (including, but not limited to, its charter or other organizational
document) which limits the amount of, or otherwise imposes restrictions on the
incurring of, Debt of the Company, except as specifically indicated in Schedule
5.15.

 
    Section 5.16 Foreign Assets Control Regulations, Etc.
 

       (a) Neither the sale of the Notes by the Company hereunder nor its use of
the proceeds thereof will violate the Trading with the Enemy Act, as amended, or
any of the foreign assets control regulations of the United States Treasury
Department (31 CFR, Subtitle B, Chapter V, as amended) or any enabling
legislation or executive order relating thereto.            (b) Neither the
Company nor any Subsidiary (1) is a Person described or designated in the
Specially Designated Nationals and Blocked Persons List of the Office of Foreign
Assets Control or in Section 1 of the Anti-Terrorism Order or (2) knowingly
engages in any dealings or transactions with any such Person. The Company and
its Subsidiaries are in compliance, in all material respects, with the USA
Patriot Act.            (c) No part of the proceeds from the sale of the Notes
hereunder will be used, directly or indirectly, for any payments to any
governmental official or employee, political party, official of a political
party, candidate for political office, or anyone else acting in an official
capacity, in order to obtain, retain or direct business or obtain any improper
advantage, in violation of the United States Foreign Corrupt Practices Act of
1977, as amended, assuming in all cases that such Act applies to the Company.  
 

  

    Section 5.17 Status under Certain Statutes. Neither the Company nor any
Restricted Subsidiary is subject to regulation under the Investment Company Act
of 1940, as amended, the Public Utility Holding Company Act of 2005, as amended,
the ICC Termination Act of 1995, as amended, or the Federal Power Act, as
amended.

    Section 5.18 Environmental Matters.
 

       (a) Neither the Company nor any Restricted Subsidiary has knowledge of
any claim or has received any notice of any claim, and no proceeding has been
instituted raising any claim against the Company or any of its Restricted
Subsidiaries or any of their respective real properties now or formerly owned,
leased or operated by any of them or other assets, alleging any damage to the
environment or violation of any Environmental Laws, except, in each case, such
as would not reasonably be expected to result in a Material Adverse Effect.    
       (b) Neither the Company nor any Restricted Subsidiary has knowledge of
any facts which would give rise to any claim, public or private, of violation of
Environmental Laws or damage to the environment emanating from, occurring on or
in any way related to real properties now or formerly owned, leased or operated
by any of them or to other assets or their use, except, in each case, such as
would not reasonably be expected to result in a Material Adverse Effect.    

 
 
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      (c) Neither the Company nor any Restricted Subsidiary has stored any
Hazardous Materials on real properties now or formerly owned, leased or operated
by any of them or has disposed of any Hazardous Materials in each case in a
manner contrary to any Environmental Laws in each case in any manner that would
reasonably be expected to result in a Material Adverse Effect.            (d)
All buildings on all real properties now owned, leased or operated by the
Company or any Restricted Subsidiary are in compliance with applicable
Environmental Laws, except where failure to comply would not reasonably be
expected to result in a Material Adverse Effect.    

 
    Section 5.19 Notes Rank Pari Passu.
 

      (a) The obligations of the Company under this Agreement and the Notes rank
pari passu in right of payment with all other unsecured Senior Debt (actual or
contingent) of the Company, including, without limitation, all unsecured Senior
Debt of the Company described in Schedule 5.15.           (b) The obligations of
each Subsidiary Guarantor under the Subsidiary Guaranty rank pari passu in right
of payment with all other unsecured Senior Debt (actual or contingent) of such
Subsidiary Guarantor, including, without limitation, all unsecured Senior Debt
of such Subsidiary Guarantor described in Schedule 5.15.    

 

SECTION 6. REPRESENTATIONS OF THE PURCHASERS.

    Section 6.1 Purchase for Investment. Each Purchaser severally represents
that it is purchasing the Notes for its own account or for one or more separate
accounts maintained by it or for the account of one or more pension or trust
funds and not with a view to the distribution thereof, provided that any Notes
purchased by Bank of America Merrill Lynch on the Closing Date may, in the
alternative, be purchased with the intent to be resold to a Qualified
Institutional Buyer pursuant to Rule 144A of the Securities Act, provided
further that, in any case, the disposition of such Purchaser's or such pension
or trust fund's property shall at all times be within such Purchaser's or such
pension or trust fund's control. Each Purchaser understands that the Notes have
not been registered under the Securities Act and may be resold only if
registered pursuant to the provisions of the Securities Act or if an exemption
from registration is available, except under circumstances where neither such
registration nor such an exemption is required by law, and that the Company is
not required to register the Notes.

    Section 6.2 Accredited Investor. Each Purchaser represents that it is an
"accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) of
Regulation D under the Securities Act) acting for its own account (and not for
the account of others) or as a fiduciary or agent for others (which others are
also "accredited investors"). Each Purchaser further represents that such
Purchaser has had the opportunity to ask questions of the Company and received
answers concerning the terms and conditions of the sale of the Notes.
 
 
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    Section 6.3 Source of Funds. Each Purchaser severally represents that at
least one of the following statements is an accurate representation as to each
source of funds (a "Source") to be used by such Purchaser to pay the purchase
price of the Notes to be purchased by such Purchaser hereunder:
 

 

       (a) the Source is an "insurance company general account" (as the term is
defined in the United States Department of Labor's Prohibited Transaction Class
Exemption ("PTE") 95-60) in respect of which the reserves and liabilities (as
defined by the annual statement for life insurance companies approved by the
NAIC (the "NAIC Annual Statement")) for the general account contract(s) held by
or on behalf of any employee benefit plan together with the amount of the
reserves and liabilities for the general account contract(s) held by or on
behalf of any other employee benefit plans maintained by the same employer (or
affiliate thereof as defined in PTE 95- 60) or by the same employee organization
in the general account do not exceed 10% of the total reserves and liabilities
of the general account (exclusive of separate account liabilities) plus surplus
as set forth in the NAIC Annual Statement filed with such Purchaser's state of
domicile; or            (b) the Source is a separate account that is maintained
solely in connection with such Purchaser's fixed contractual obligations under
which the amounts payable, or credited, to any employee benefit plan (or its
related trust) that has any interest in such separate account (or to any
participant or beneficiary of such plan (including any annuitant)) are not
affected in any manner by the investment performance of the separate account; or
           (c) the Source is either (1) an insurance company pooled separate
account, within the meaning of PTE 90-1 or (2) a bank collective investment
fund, within the meaning of PTE 91-38 and, except as disclosed by such Purchaser
to the Company in writing pursuant to this clause (c), no employee benefit plan
or group of plans maintained by the same employer or employee organization
beneficially owns more than 10% of all assets allocated to such pooled separate
account or collective investment fund; or            (d) the Source constitutes
assets of an "investment fund" (within the meaning of Part V of PTE 84-14 (the
"QPAM Exemption")) managed by a "qualified professional asset manager" or "QPAM"
(within the meaning of Part V of the QPAM Exemption), no employee benefit plan's
assets that are included in such investment fund, when combined with the assets
of all other employee benefit plans established or maintained by the same
employer or by an affiliate (within the meaning of Section V(c)(1) of the QPAM
Exemption) of such employer or by the same employee organization and managed by
such QPAM, exceed 20% of the total client assets managed by such QPAM, the
conditions of Part I(c) and (g) of the QPAM Exemption are satisfied, neither the
QPAM nor a Person controlling or controlled by the QPAM (applying the definition
of "control" in Section V(e) of the QPAM Exemption) owns a 5% or more interest
in the Company and (1) the identity of such QPAM and (2) the names of all
employee benefit plans whose assets are included in such investment fund have
been disclosed to the Company in writing pursuant to this clause (d); or    

 
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       (e) the Source constitutes assets of a "plan(s)" (within the meaning of
Section IV of PTE 96-23 (the "INHAM Exemption")) managed by an "in-house asset
manager" or "INHAM" (within the meaning of Part IV of the INHAM Exemption), the
conditions of Part I(a), (g) and (h) of the INHAM Exemption are satisfied,
neither the INHAM nor a Person controlling or controlled by the INHAM (applying
the definition of "control" in Section IV(d) of the INHAM Exemption) owns a 5%
or more interest in the Company and (1) the identity of such INHAM and (2) the
name(s) of the employee benefit plan(s) whose assets constitute the Source have
been disclosed to the Company in writing pursuant to this clause (e); or      
     (f) the Source is a governmental plan; or            (g) the Source is one
or more employee benefit plans, or a separate account or trust fund comprised of
one or more employee benefit plans, each of which has been identified to the
Company in writing pursuant to this clause (g); or            (h) the Source
does not include assets of any employee benefit plan, other than a plan exempt
from the coverage of ERISA.    

 
As used in this Section 6.3, the terms "employee benefit plan," "governmental
plan" and "separate account" shall have the respective meanings assigned to such
terms in Section 3 of ERISA.

SECTION 7. INFORMATION AS TO COMPANY.

    Section 7.1 Financial and Business Information. The Company shall deliver to
each holder of Notes that is an Institutional Investor:
 

   (a) Quarterly Statements - within 60 days after the end of each quarterly
fiscal period in each fiscal year of the Company (other than the last quarterly
fiscal period of each such fiscal year), copies of:

 

   (1) a consolidated balance sheet of the Company and its Subsidiaries as at
the end of such quarter, and        (2) consolidated statements of income,
changes in shareholders' equity and cash flows of the Company and its
Subsidiaries for such quarter and (in the case of the second and third quarters)
for the portion of the fiscal year ending with such quarter,

 
setting forth in each case in comparative form the figures for the corresponding
periods in the previous fiscal year, all in reasonable detail, prepared in
accordance with GAAP applicable to quarterly financial statements generally, and
certified by a Senior Financial -15- Officer as fairly presenting, in all
material respects, the financial position of the companies being reported on and
their results of operations and cash flows, subject to changes resulting from
year-end adjustments, provided that delivery within the time period specified
above of copies of the Company's Quarterly Report on Form 10-Q prepared in
compliance with the requirements therefor and filed with the SEC shall be deemed
to satisfy the requirements of this Section 7.1(a);
 
 
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    (b) Annual Statements - within 105 days after the end of each fiscal year of
the Company, copies of:
 

   (1) a consolidated balance sheet of the Company and its Subsidiaries, as at
the end of such year, and        (2) consolidated statements of income, changes
in shareholders' equity and cash flows of the Company and its Subsidiaries, for
such year,

 
setting forth in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail, prepared in accordance with GAAP, and
accompanied by an opinion thereon of independent certified public accountants of
recognized national standing, which opinion shall state that such financial
statements present fairly, in all material respects, the financial position of
the companies being reported upon and their results of operations and cash flows
and have been prepared in conformity with GAAP, and that the examination of such
accountants in connection with such financial statements has been made in
accordance with generally accepted auditing standards, and that such audit
provides a reasonable basis for such opinion in the circumstances, provided that
the delivery within the time period specified above of the Company's Annual
Report on Form 10-K for such fiscal year (together with the Company's annual
report to shareholders, if any, prepared pursuant to Rule 14a-3 under the
Exchange Act) prepared in accordance with the requirements therefor and filed
with the SEC shall be deemed to satisfy the requirements of this Section 7.1(b);

    (c) SEC and Other Reports - except for filings referred to in Section 7.1(a)
and (b) above, promptly upon their becoming available and, to the extent
applicable, one copy of (1) each financial statement, report, notice or proxy
statement sent by the Company or any Subsidiary to its principal lending banks
as a whole (excluding information sent to such banks in the ordinary course of
administration of a bank facility, such as information relating to pricing and
borrowing availability) or to its public securities holders generally and (2)
each regular or periodic report, each registration statement that shall have
become effective (without exhibits except as expressly requested by such
holder), and each final prospectus and all amendments thereto filed by the
Company or any Subsidiary with the SEC;

    (d) Notice of Default or Event of Default - promptly, and in any event
within five Business Days after a Responsible Officer becomes aware of the
existence of any Default or Event of Default or that any holder of Notes has
given any notice in writing or taken any action with respect to a claimed
default hereunder or that any Person has given -16- any notice in writing or
taken any action with respect to a claimed default of the type referred to in
Section 11(g), a written notice specifying the nature and period of existence
thereof and what action the Company is taking or proposes to take with respect
thereto;
 
 
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    (e) ERISA Matters - promptly, and in any event within five Business Days
after a Responsible Officer becomes aware of any of the following, a written
notice setting forth the nature thereof and the action, if any, that the Company
or an ERISA Affiliate proposes to take with respect thereto:

 

   (1) with respect to any Plan, any reportable event, as defined in Section
4043(c) of ERISA and the regulations thereunder, for which notice thereof has
not been waived pursuant to such regulations as in effect on the date thereof;
or        (2) the taking by the PBGC of steps to institute, or the threatening
by the PBGC of the institution of, proceedings under Section 4042 of ERISA for
the termination of, or the appointment of a trustee to administer, any Plan, or
the receipt by the Company or any ERISA Affiliate of a notice from a
Multiemployer Plan that such action has been taken by the PBGC with respect to
such Multiemployer Plan; or        (3) any event, transaction or condition that
would result in the incurrence of any liability by the Company or any ERISA
Affiliate pursuant to Title I or IV of ERISA or the imposition of a penalty or
excise tax under the provisions of the Code relating to employee benefit plans,
or the imposition of any Lien on any of the rights, properties or assets of the
Company or any ERISA Affiliate pursuant to Title I or IV of ERISA or such
penalty or excise tax provisions, if such liability or Lien, taken together with
any other such liabilities or Liens then existing, would reasonably be expected
to have a Material Adverse Effect; or        (4) receipt of notice of the
imposition of a Material financial penalty (which for this purpose shall mean
any tax, penalty or other liability, whether by way of indemnity or otherwise)
with respect to one or more Non-U.S. Plans;    

 
    (f) Notices from Governmental Authority - promptly, and in any event within
30 days of receipt thereof, copies of any notice to the Company or any
Subsidiary from any federal or state Governmental Authority relating to any
order, ruling, statute or other law or regulation that would reasonably be
expected to have a Material Adverse Effect; and

    (g) Requested Information - with reasonable promptness, such other data and
information relating to the business, operations, affairs, financial condition,
assets or properties of the Company or any of its Subsidiaries or relating to
the ability of the Company to perform its obligations hereunder and under the
Notes as from time to time may be reasonably requested by any such holder of
Notes or such information regarding the Company required to satisfy the
requirements of 17 C.F.R. §230.144A, as amended from time to time, in connection
with any contemplated transfer of the Notes.
 
 
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    Notwithstanding the foregoing, in the event that one or more Unrestricted
Subsidiaries shall either (i) own more than 10% of the consolidated total assets
of the Company and its Subsidiaries or (ii) account for more than 10% of the
consolidated gross revenues of the Company and its Subsidiaries, determined in
each case in accordance with GAAP, then, within the respective periods provided
in Section 7.1(a) and (b) above, the Company shall deliver to each holder of
Notes that is an Institutional Investor, unaudited financial statements of the
character and for the dates and periods as in said Sections 7.1(a) and (b)
covering such group of Unrestricted Subsidiaries (on a consolidated basis),
together with a consolidating statement reflecting eliminations or adjustments
required to reconcile the financial statements of such group of Unrestricted
Subsidiaries to the financial statements delivered pursuant to Sections 7.1(a)
and (b).

    Section 7.2 Officer's Certificate. Each set of financial statements
delivered to a holder of Notes pursuant to Section 7.1(a) or Section 7.1(b)
shall be accompanied by a certificate of a Senior Financial Officer of the
Company setting forth:

 

     (a) Covenant Compliance - the information (including reasonably detailed
calculations) required in order to establish whether the Company was in
compliance with the requirements of Section 10.1 through Section 10.3,
inclusive, and Section 10.5 during the quarterly or annual period covered by the
statements then being furnished (including with respect to each such Section,
where applicable, the calculations of the maximum or minimum amount, ratio or
percentage, as the case may be, permissible under the terms of such Sections,
and the calculation of the amount, ratio or percentage then in existence); and  
       (b) Event of Default - a statement that such Senior Financial Officer has
reviewed the relevant terms hereof and has made, or caused to be made, under his
or her supervision, a review of the transactions and conditions of the Company
and its Subsidiaries from the beginning of the quarterly or annual period
covered by the statements then being furnished to the date of the certificate
and that such review shall not have disclosed the existence during such period
of any condition or event that constitutes a Default or an Event of Default or,
if any such condition or event existed or exists specifying the nature and
period of existence thereof and what action the Company shall have taken or
proposes to take with respect thereto.    

 
Section 7.3 Visitation. The Company shall permit the representatives of each
holder of Notes that is an Institutional Investor:
 

     (a) No Default - if no Default or Event of Default then exists, at the
expense of such holder and upon reasonable prior notice to the Company, to visit
the principal executive office of the Company, to discuss the affairs, finances
and accounts of the Company and its Subsidiaries with the Company's officers,
and (with the consent of the Company, which consent will not be unreasonably
withheld) its independent public accountants, and (with the consent of the
Company, which consent will not be unreasonably withheld) to visit the other
offices and properties of the Company and each Restricted Subsidiary, all at
such reasonable times and as often as may be reasonably requested in writing;
and

 
 
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      (b) Default - if a Default or Event of Default then exists, at the expense
of the Company, to visit and inspect any of the offices or properties of the
Company or any Restricted Subsidiary, to examine all their respective books of
account, records, reports and other papers, to make copies and extracts
therefrom, and to discuss their respective affairs, finances and accounts with
their respective officers and independent public accountants (and by this
provision the Company authorizes said accountants to discuss the affairs,
finances and accounts of the Company and its Subsidiaries), all at such times
and as often as may be requested.

 
SECTION 8. PAYMENT OF THE NOTES.

    Section 8.1 Required Prepayments; Maturity. The Notes shall not be subject
to any required prepayments and the entire unpaid principal amount of the Notes
shall become due and payable on April 29, 2020.

   Section 8.2 Optional Prepayments.

 

   (a) Optional Prepayments of the Notes. The Company may, at its option, upon
notice as provided below, prepay at any time all, or from time to time any part
of the Notes, in an amount not less than 10% of the original aggregate principal
amount of the Notes in the case of a partial prepayment, at 100% of the
principal amount so prepaid, plus accrued and unpaid interest, plus the
Make-Whole Amount, if any, determined for the prepayment date with respect to
such principal amount.        (b) Notice of Optional Prepayments. The Company
will give each holder of Notes written notice of each optional prepayment of
Notes under this Section 8.2 not less than 30 days and not more than 60 days
prior to the date fixed for such prepayment. Each such notice shall specify such
date (which shall be a Business Day), the aggregate principal amount of the
Notes to be prepaid on such date, the principal amount of each Note held by such
holder to be prepaid (determined in accordance with Section 8.3), and the
interest to be paid on the prepayment date with respect to such principal amount
being prepaid, and shall be accompanied by a certificate of a Senior Financial
Officer as to the estimated Make-Whole Amount, if any, due in connection with
such prepayment (calculated as if the date of such notice were the date of the
prepayment), setting forth the details of such computation. Two Business Days
prior to such prepayment, the Company shall deliver to each holder of Notes a
certificate of a Senior Financial Officer specifying the calculation of the
applicable Make-Whole Amount as of the specified prepayment date.

 
    Section 8.3 Allocation of Partial Prepayments. In the case of each partial
prepayment of the Notes pursuant to the provisions of Section 8.2, the principal
amount of the Notes to be prepaid shall be allocated among all of the Notes at
the time outstanding in proportion, as nearly as practicable, to the respective
unpaid principal amounts thereof.
 
 
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    Section 8.4 Maturity; Surrender, Etc. In the case of each prepayment of
Notes pursuant to this Section 8, the principal amount of each Note to be
prepaid shall mature and become due and payable on the date fixed for such
prepayment (which shall be a Business Day), together with interest on such
principal amount accrued to such date and the applicable Make-Whole Amount, if
any. From and after such date, unless the Company shall fail to pay such
principal amount when so due and payable, together with the interest and
Make-Whole Amount, if any, as aforesaid, interest on such principal amount shall
cease to accrue. Any Note paid or prepaid in full shall be surrendered to the
Company and cancelled and shall not be reissued, and no Note shall be issued in
lieu of any prepaid principal amount of any Note.

    Section 8.5 Purchase of Notes. The Company will not, and will not permit any
Affiliate to, purchase, redeem, prepay or otherwise acquire, directly or
indirectly, any of the outstanding Notes except (a) upon the payment or
prepayment of the Notes in accordance with the terms of this Agreement and the
Notes or (b) pursuant to a written offer to purchase any outstanding Notes made
by the Company or an Affiliate pro rata to the holders of the Notes upon the
same terms and conditions. Any such offer shall provide each holder of the Notes
with sufficient information to enable it to make an informed decision with
respect to such offer and shall remain open for at least 10 Business Days. If
the holders of more than 50% of the outstanding principal amount of the Notes
accept such offer, the Company shall promptly notify the remaining holders of
Notes of such fact and the expiration date for the acceptance by such holders of
Notes of such offer shall be extended by the number of days necessary to give
each such remaining holders of Notes at least 5 Business Days from its receipt
of such notice to accept such offer. The Company will promptly cancel all Notes
acquired by it or any Affiliate pursuant to any payment, prepayment or purchase
of Notes pursuant to any provision of this Agreement and no Notes may be issued
in substitution or exchange for any such Notes.

    Section 8.6 Offer to Prepay Upon Sale of Assets.
 

   (a) Notice and Offer. In the event of a sale, lease or other disposition of a
"substantial part" of the assets of the Company or any Restricted Subsidiary
where the Company has elected to apply the net proceeds of such sale, lease or
other disposition pursuant to Section 10.5(b), the Company shall, no later than
the 305th day following the date of such sale, lease or other disposition, give
written notice of such event (a "Sale of Assets Prepayment Event") to each
holder of Notes. Such notice shall contain, and shall constitute, an irrevocable
offer to prepay a Ratable Portion of the Notes held by such holder on the date
specified in such notice (the "Sale of Assets Prepayment Date") which date shall
be not less than 30 days and not more than 60 days after such notice.        (b)
Acceptance and Payment. A holder of Notes may accept or reject the offer to
prepay pursuant to this Section 8.6 by causing a notice of such acceptance or
rejection to be delivered to the Company at least 10 days prior to the Sale of
Assets Prepayment Date. A failure by a holder of the Notes to respond to an
offer to prepay made pursuant to this Section 8.6 shall be deemed to constitute
an acceptance of such offer by such holder. If so accepted, such offered
prepayment in respect of the Ratable Portion of the Notes of each holder that
has accepted such offer shall be due and payable on the Sale of Assets
Prepayment Date. Such offered prepayment shall be made at 100% of the aggregate
Ratable Portion of the Notes of each holder that has accepted such offer,
together with interest on that portion of the Notes then being prepaid accrued
to the Sale of Assets Prepayment Date, but, in any case, without any Make-Whole
Amount.    

 
 
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   (c) Officer's Certificate. Each offer to prepay the Notes pursuant to this
Section 8.6 shall be accompanied by a certificate, executed by a Senior
Financial Officer of the Company and dated the date of such offer, specifying:
(1) the Sale of Assets Prepayment Date; (2) that such offer is being made
pursuant to this Section 8.6 and that the failure by a holder to respond to such
offer by the deadline established in Section 8.6(b) shall result in such offer
to such holder being deemed accepted; (3) the Ratable Portion of each such Note
offered to be prepaid; (4) the interest that would be due on the Ratable Portion
of each such Note offered to be prepaid, accrued to the Sale of Assets
Prepayment Date; (5) that the conditions of this Section 8.6 have been satisfied
and (6) in reasonable detail, a description of the nature and date of the Sale
of Assets Prepayment Event giving rise to such offer of prepayment.

 
    Section 8.7 Offer to Prepay in the Event of a Change in Control.
 

 

   (a) Notice of Change in Control or Control Event. The Company will, within 10
Business Days after any Responsible Officer has knowledge of the occurrence of
any Change in Control or Control Event, give written notice of such Change in
Control or Control Event to each holder of Notes unless notice in respect of
such Change in Control (or the Change in Control contemplated by such Control
Event) shall have been given pursuant to Section 8.7(b). If a Change in Control
has occurred, such notice shall contain and constitute an offer to prepay Notes
as described in Section 8.7(c) and shall be accompanied by the certificate
described in Section 8.7(g).        (b) Condition to Company Action. The Company
will not take any action that consummates or finalizes a Change in Control
unless (1) at least 30 days prior to such action it shall have given to each
holder of Notes written notice containing and constituting an offer to prepay
Notes as described in Section 8.7(c), accompanied by the certificate described
in Section 8.7(g), and (2) contemporaneously with such action, the Company
prepays all Notes required to be prepaid in accordance with this Section 8.7.  
     (c) Offer to Prepay Notes. The offer to prepay Notes contemplated by
Sections 8.7(a) and (b) shall be an offer to prepay, in accordance with and
subject to this Section 8.7, all, but not less than all, Notes held by each
holder (in this case only, "holder" in respect of any Note registered in the
name of a nominee for a disclosed beneficial owner shall mean such beneficial
owner) on a date specified in such offer (the "Change in Control Proposed
Prepayment Date"). If such Change in Control Proposed Prepayment Date is in
connection with an offer contemplated by Section 8.7, such date shall be a
Business Day not less than 30 days and not more than 60 days after the date of
such offer (or if the Change in Control Proposed Prepayment Date shall not be
specified in such offer, the Change in Control Proposed Prepayment Date shall be
the Business Day nearest to the 30th day after the date of such offer).    

 
 
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    (d) Acceptance; Rejection. A holder of Notes may accept or reject the offer
to prepay made pursuant to this Section 8.7 by causing a notice of such
acceptance or rejection to be delivered to the Company at least five Business
Days prior to the Change in Control Proposed Prepayment Date. A failure by a
holder of Notes to so respond to an offer to prepay made pursuant to this
Section 8.7 shall be deemed to constitute a rejection of such offer by such
holder.
       (e) Prepayment. Prepayment of the Notes to be prepaid pursuant to this
Section 8.7 shall be at 100% of the principal amount of such Notes, together
with accrued and unpaid interest on such Notes accrued to the date of prepayment
but without any Make-Whole Amount. The prepayment shall be made on the Change in
Control Proposed Prepayment Date, except as provided by Section 8.7(f).      
 (f) Deferral Pending Change in Control. The obligation of the Company to prepay
Notes pursuant to the offers required by Section 8.7(c) and accepted in
accordance with Section 8.7(d) is subject to the occurrence of the Change in
Control in respect of which such offers and acceptances shall have been made. In
the event that such Change in Control does not occur on the Change in Control
Proposed Prepayment Date in respect thereof, the prepayment shall be deferred
until, and shall be made on the date on which, such Change in Control occurs.
The Company shall keep each holder of Notes reasonably and timely informed of
(1) any such deferral of the date of prepayment, (2) the date on which such
Change in Control and the prepayment are expected to occur and (3) any
determination by the Company that efforts to effect such Change in Control have
ceased or been abandoned (in which case the offers and acceptances made pursuant
to this Section 8.7 in respect of such Change in Control automatically shall be
deemed rescinded without penalty or other liability).        (g) Officer's
Certificate. Each offer to prepay the Notes pursuant to this Section 8.7 shall
be accompanied by a certificate, executed by a Senior Financial Officer and
dated the date of such offer, specifying (1) the Change in Control Proposed
Prepayment Date, (2) that such offer is made pursuant to this Section 8.7, (3)
the principal amount of each Note offered to be prepaid, (4) the interest that
would be due on each Note offered to be prepaid, accrued to the Change in
Control Proposed Prepayment Date, (5) that the conditions of this Section 8.7
have been fulfilled and (6) in reasonable detail, the nature and date of the
Change in Control.        (h) "Change in Control" shall mean, either of (1) the
acquisition by any "person" or "group" (as such terms are used in Sections 13(d)
and Section 14(d) of the Exchange Act as in effect on the date of the Closing)
at any time of beneficial ownership of more than 50% of the outstanding capital
stock or other equity interests of the Company on a fully-diluted basis or (2)
any "Change of Control" (or words of like import), as defined in any Material
Loan Agreement shall occur.    

 
 
 
 
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   (i) "Control Event" shall mean (1) the execution by the Company or any of its
Affiliates of any agreement or letter of intent with respect to any proposed
transaction or event or series of transactions or events which, individually or
in the aggregate, may reasonably be expected to result in a Change in Control,
(2) the execution of any written agreement which, when fully performed by the
parties thereto, would result in a Change in Control or (3) the making of any
written offer by any "person" or "group" (as such terms are used in Section
13(d) and Section 14(d) of the Exchange Act as in effect on the Closing Date) to
the holders of equity interests of the Company or of any of its Affiliates,
which offer, if accepted by the requisite number of holders, would result in a
Change in Control.

 
 
    Section 8.8 Make-Whole Amount. The term "Make-Whole Amount" shall mean, with
respect to any Note, an amount equal to the excess, if any, of the Discounted
Value of the Remaining Scheduled Payments with respect to the Called Principal
of such Notes, minus the amount of such Called Principal, provided that the
Make-Whole Amount may in no event be less than zero. For the purposes of
determining the Make-Whole Amount, the following terms have the following
meanings:
 

 

   "Called Principal" shall mean, with respect to any Note, the principal of
such Note that is to be prepaid pursuant to Section 8.2 or has become or is
declared to be immediately due and payable pursuant to Section 12.1, as the
context requires.        "Discounted Value" shall mean, with respect to the
Called Principal of any Note, the amount obtained by discounting all Remaining
Scheduled Payments with respect to such Called Principal from their respective
scheduled due dates to the Settlement Date with respect to such Called
Principal, in accordance with accepted financial practice and at a discount
factor (applied on the same periodic basis as that on which interest on the
Notes is payable) equal to the Reinvestment Yield with respect to such Called
Principal.        "Reinvestment Yield" shall mean, with respect to the Called
Principal of any Note, 0.50% plus the yield to maturity calculated by using (a)
the yields reported, as of 10:00 a.m. (New York, New York time) on the second
Business Day preceding the Settlement Date with respect to such Called
Principal, on the display designated as "Page PX1" (or such other display as may
replace Page PX1 on Bloomberg Financial Markets ("Bloomberg") or, if Page PX1
(or its successor screen on Bloomberg) is unavailable, the Telerate Access
Service screen which corresponds most closely to Page PX1) for the most recently
issued actively traded U.S. Treasury securities having a maturity equal to the
Remaining Average Life of such Called Principal as of such Settlement Date, or
(b) if such yields are not reported as of such time or the yields reported as of
such time are not ascertainable (including by way of interpolation), the
Treasury Constant Maturity Series Yields reported, for the latest day for which
such yields have been so reported as of the second Business Day preceding the
Settlement Date with respect to such Called Principal, in Federal Reserve
Statistical Release H.15 (519) (or any comparable successor publication) for
actively traded U.S. Treasury securities having a constant maturity equal to the
Remaining Average Life of such Called Principal as of such Settlement Date. In
either case, the yield will be determined, if necessary, by (1) converting U.S.
Treasury bill quotations to bond-equivalent yields in accordance with accepted
financial practice and (2) interpolating linearly on a straight line basis
between (i) the actively traded U.S. Treasury security with the maturity closest
to and greater than such Remaining Average Life and (ii) the actively traded
U.S. Treasury security with the maturity closest to and less than such Remaining
Average Life. The Reinvestment Yield shall be rounded to the number of decimal
places as appears in the interest rate of such Notes.

 

 
 
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   "Remaining Average Life" shall mean, with respect to the Called Principal of
any Note, the number of years (calculated to the nearest one-twelfth year)
obtained by dividing (a) such Called Principal into (b) the sum of the products
obtained by multiplying (1) the principal component of each Remaining Scheduled
Payment with respect to such Called Principal by (2) the number of years
(calculated to the nearest one-twelfth year) that will elapse between the
Settlement Date with respect to such Called Principal and the scheduled due date
of such Remaining Scheduled Payment.        "Remaining Scheduled Payments" shall
mean, with respect to the Called Principal of any Note, all payments of such
Called Principal and interest thereon that would be due after the Settlement
Date with respect to such Called Principal if no payment of such Called
Principal were made prior to its scheduled due date, provided that if such
Settlement Date is not a date on which interest payments are due to be made
under the terms of such Notes, then the amount of the next succeeding scheduled
interest payment will be reduced by the amount of interest accrued to such
Settlement Date and required to be paid on such Settlement Date pursuant to
Section 8.2 or Section 12.1.        "Settlement Date" shall mean, with respect
to the Called Principal of any Note, the date on which such Called Principal is
to be prepaid pursuant to Section 8.2 or has become or is declared to be
immediately due and payable pursuant to Section 12.1, as the context requires.  
 

 
SECTION 9. AFFIRMATIVE COVENANTS.

    The Company covenants that so long as any of the Notes are outstanding:

   Section 9.1 Compliance with Law. Without limiting Section 10.8, the Company
will, and will cause each of its Subsidiaries to, comply with all laws,
ordinances or governmental rules or regulations to which each of them is
subject, including, without limitation, Environmental Laws, ERISA and the USA
Patriot Act, and will obtain and maintain in effect all licenses, certificates,
permits, franchises and other governmental authorizations necessary to the
ownership of their respective properties or to the conduct of their respective
businesses, in each case to the extent necessary to ensure that non-compliance
with such laws, ordinances or governmental rules or regulations or failures to
obtain or maintain in effect such licenses, certificates, permits, franchises
and other governmental authorizations would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.

            Section 9.2 Insurance. The Company will, and will cause each of its
Restricted Subsidiaries to, maintain, with financially sound and reputable
insurers, insurance with respect to their respective properties and businesses
against such casualties and contingencies, of such types, on such terms and in
such amounts (including deductibles, co- insurance and selfinsurance, if
adequate reserves are maintained with respect thereto) as is customary in the
case of entities of established reputations engaged in the same or a similar
business and similarly situated.
 

 
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   Section 9.3 Maintenance of Properties. The Company will, and will cause each
of its Restricted Subsidiaries to, maintain and keep, or cause to be maintained
and kept, their respective properties in good repair, working order and
condition (other than ordinary wear and tear), so that the business carried on
in connection therewith may be properly conducted at all times, provided that
this Section shall not prevent the Company or any Restricted Subsidiary from
discontinuing the operation and the maintenance of any of its properties if such
discontinuance is desirable in the conduct of its business and the Company has
concluded that such discontinuance would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.

   Section 9.4 Payment of Taxes and Claims. The Company will, and will cause
each of its Subsidiaries to, file all tax returns required to be filed in any
jurisdiction and to pay and discharge all taxes shown to be due and payable on
such returns and all other taxes, assessments, governmental charges or levies
imposed upon them or any of their properties, assets, income or franchises, to
the extent such taxes, assessments, governmental charges or levies have become
due and payable and before they have become delinquent and all claims for which
sums have become due and payable that have or might become a Lien on properties
or assets of the Company or any Subsidiary, provided that neither the Company
nor any Subsidiary need pay any such tax, assessment, governmental charge, levy
or claim if (a) the amount, applicability or validity thereof is contested by
the Company or such Subsidiary on a timely basis in good faith and in
appropriate proceedings, and the Company or a Subsidiary has established
adequate reserves therefor in accordance with GAAP on the books of the Company
or such Subsidiary or (b) the non-filing or nonpayment, as the case may be, of
all such taxes, assessments, governmental charges, levies and claims in the
aggregate would not reasonably be expected to have a Material Adverse Effect.

   Section 9.5 Corporate Existence, Etc. Subject to Section 10.4, the Company
will at all times preserve and keep in full force and effect its corporate
existence. Subject to Sections 10.4 and 10.5, the Company will at all times
preserve and keep in full force and effect the corporate or other existence of
each of its Restricted Subsidiaries (unless merged into the Company or a
Restricted Subsidiary) and all rights and franchises of the Company and its
Restricted Subsidiaries unless, in the good faith judgment of the Company, the
termination of or failure to preserve and keep in full force and effect such
corporate or other existence, right or franchise would not, individually or in
the aggregate, have a Material Adverse Effect.

   Section 9.6 Notes and Subsidiary Guaranty to Rank Pari Passu.
 
 

   (a) The Notes and all other obligations under this Agreement of the Company
are and at all times shall remain direct and unsecured obligations of the
Company ranking pari passu as against the assets of the Company with all other
present and future unsecured Senior Debt (actual or contingent) of the Company.

 
 
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   (b) The Subsidiary Guaranty and all other obligations of each Subsidiary
Guarantor under the Subsidiary Guaranty are and at all times shall remain direct
and unsecured obligations of such Subsidiary Guarantor ranking pari passu as
against the assets of such Subsidiary Guarantor with all other present and
future unsecured Senior Debt (actual or contingent) of such Subsidiary
Guarantor.

 

   Section 9.7 Books and Records. The Company will, and will cause each of its
Restricted Subsidiaries to, maintain proper books of record and account in
conformity with GAAP and all applicable requirements of any Governmental
Authority having legal or regulatory jurisdiction over the Company or such
Restricted Subsidiary, as the case may be.

   Section 9.8 Designation of Subsidiaries. The Company may from time to time
cause any Subsidiary (other than a Subsidiary Guarantor) to be designated as an
Unrestricted Subsidiary or any Unrestricted Subsidiary to be designated a
Restricted Subsidiary; provided, however, that at the time of such designation
and immediately after giving effect thereto, (a) no Default or Event of Default
shall have occurred and be continuing under the terms of this Agreement and (b)
the Company and its Subsidiaries or Restricted Subsidiaries, as the case may be,
would be in compliance with all of the covenants set forth in this Section 9 and
Section 10 if tested on the date of such action and provided, further, that,
except as required in order for the Company to comply with the requirements of
Section 10.9, once a Subsidiary has been designated an Unrestricted Subsidiary
or a Restricted Subsidiary pursuant to this Section 9.8, it shall not thereafter
be redesignated as an Unrestricted Subsidiary or a Restricted Subsidiary on more
than one occasion. Within 10 days following any designation described above, the
Company will deliver to each holder of Notes a notice of such designation
accompanied by a certificate signed by a Senior Financial Officer of the Company
certifying compliance with all requirements of this Section 9.8 and setting
forth all information required in order to establish such compliance.

   Section 9.9 Additional Subsidiary Guarantors. The Company will cause any
Domestic Subsidiary which becomes an obligor, co-obligor or guarantor in respect
of Debt under the Bank Credit Agreement to become a party to the Subsidiary
Guaranty and deliver to each of the holders of the Notes (concurrently with
becoming an obligor, co-obligor or guarantor in respect of Debt under the Bank
Credit Agreement) the following items:
 

 

   (a) a supplement to the Subsidiary Guaranty in the form of Exhibit A to the
Subsidiary Guaranty (a "Guaranty Supplement");        (b) a certificate signed
by an authorized Responsible Officer making representations and warranties to
the effect of those contained in Sections 5.2, 5.4, 5.6 and 5.7, with respect to
such Subsidiary and such Subsidiary Guaranty, as applicable; and        (c) an
opinion of counsel (who may be in-house counsel for the Company) addressed to
each of the holders of the Notes which opinion shall be satisfactory to the
Required Holders, to the effect that the Guaranty Supplement has been duly
authorized, executed and delivered and that such Subsidiary Guaranty constitutes
the legal, valid and binding contract and agreement of such Subsidiary
enforceable in accordance with its terms, except as an enforcement of such terms
may be limited by bankruptcy, insolvency, fraudulent conveyance and similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles.    

 

 
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    In connection with any amendment, extension, renewal, replacement or
refinancing of the Bank Credit Agreement after the Closing Date, the Company
shall cause such amended, extended, renewed, replaced or refinanced Bank Credit
Agreement to permit the Notes to be guaranteed by, and the Company shall cause
the Notes to be guaranteed by, each Foreign Subsidiary that shall then be or
thereafter become an obligor, co-obligor or guarantor in respect of Debt under
the Bank Credit Agreement and upon any Foreign Subsidiary becoming obligated
hereunder to guaranty the Notes, such Foreign Subsidiary shall deliver to each
of the holders of the Notes the items described in clauses (a), (b) and (c) of
this Section 9.9.

    Anything in this Section 9.9 to the contrary notwithstanding, a Foreign
Subsidiary that is or becomes a borrower under the Bank Credit Agreement shall
not be deemed to be an obligor, guarantor or co-obligor of obligations existing
under the Bank Credit Agreement for purposes of this Section 9.9 if such
Subsidiary shall have no obligations under the Bank Credit Agreement or any
other agreement or instrument for the repayment of any Debt outstanding under
the Bank Credit Agreement (whether upon default by any party to the Bank Credit
Agreement or otherwise) other than Debt directly borrowed by such Subsidiary.

SECTION 10. NEGATIVE COVENANTS.

    The Company covenants that so long as any of the Notes are outstanding:

   Section 10.1 Consolidated Debt to Consolidated EBITDA. The Company will not,
at any time, permit the ratio of (a) Consolidated Debt at such time to (b)
Consolidated EBITDA for the period of four consecutive fiscal quarters ending
on, or most recently ended prior to, such time to be greater than the Maximum
Leverage Ratio. "Maximum Leverage Ratio" shall mean (1) at any time during any
fiscal quarter in which the Company has provided the holders of Notes with a
Notice of Election to Increase Leverage Ratio and during each of the three
consecutive fiscal quarters immediately thereafter, 3.75 to 1.00 and (2) at any
other time, 3.25 to 1.00.

    In this Section 10.1, for purposes of calculating Consolidated EBITDA for
any period of four consecutive fiscal quarters, if during such period (1) the
Company or any Restricted Subsidiary shall have acquired or disposed of any
Person or acquired or disposed of all or substantially all of the assets of any
Person or any business unit or division of any Person or (2) any Restricted
Subsidiary is designated an Unrestricted Subsidiary or any Unrestricted
Subsidiary is designated a Restricted Subsidiary, Consolidated EBITDA for such
period shall be calculated after giving pro forma effect thereto as if such
transaction occurred on the first day of such period.
 
 
 
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   Section 10.2 Priority Debt. The Company will not, at any time, permit the
aggregate amount of all Priority Debt to exceed an amount equal to 20% of
Consolidated Total Assets determined as of the end of the then most recently
ended fiscal quarter of the Company.

   Section 10.3 Limitation on Liens. The Company will not, and will not permit
any Restricted Subsidiary to, directly or indirectly create, incur, assume or
permit to exist (upon the happening of a contingency or otherwise) any Lien on
or with respect to any property or asset (including, without limitation, any
document or instrument in respect of goods or accounts receivable) of the
Company or any Restricted Subsidiary, whether now owned or held or hereafter
acquired, or any income or profits therefrom, or assign or otherwise convey any
right to receive income or profits (unless it makes, or causes to be made,
effective provision whereby the Notes will be equally and ratably secured with
any and all other obligations thereby secured, such security to be pursuant to
an agreement reasonably satisfactory to the Required Holders and, in any such
case, the Notes shall have the benefit, to the fullest extent that, and with
such priority as, the holders of the Notes may be entitled under applicable law,
of an equitable Lien on such property), except:

 

   (a) Liens for taxes, assessments or other governmental charges that are not
yet due and payable or the payment of which is not at the time required by
Section 9.4;        (b) Liens incidental to the conduct of business or the
ownership of properties and assets (including landlords', carriers',
warehousemen's, mechanics', materialmen's and other similar Liens for sums not
yet due and payable) and Liens to secure the performance of bids, tenders,
leases or trade contracts or to secure statutory obligations (including
obligations under workers compensation, unemployment insurance and other social
security legislation), surety or appeal bonds or other Liens incurred in the
ordinary course of business and not in connection with the borrowing of money;  
     (c) leases or subleases granted to others, easements, rights-of-way,
restrictions and other similar charges or encumbrances, in each case incidental
to the ownership of property or assets or the ordinary conduct of the business
of the Company or any Restricted Subsidiary, and Liens incidental to minor
survey exceptions and the like, provided that such Liens do not, in the
aggregate, materially detract from the value of such property;        (d) any
attachment or judgment Lien, unless the judgment it secures shall not, within 60
days after the entry thereof, have been discharged or execution thereof stayed
pending appeal, or shall not have been discharged within 60 days after the
expiration of any such stay;        (e) Liens securing Debt of a Restricted
Subsidiary to the Company or to another Restricted Subsidiary;        (f) Liens
existing on the Closing Date and reflected in Schedule 10.3;    

 

 
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   (g) Liens incurred after the Closing Date given to secure the payment of the
purchase price incurred in connection with the acquisition, construction or
improvement of property (other than accounts receivable or inventory) useful and
intended to be used in carrying on the business of the Company or a Restricted
Subsidiary, including Liens existing on such property at the time of acquisition
or construction thereof or improvement thereon or Liens incurred within 365 days
of such acquisition or completion of such construction or improvement; provided
that (1) the Lien shall attach solely to the property acquired, purchased,
constructed or improved, (2) at the time of acquisition, construction or
improvement of such property (or, in the case of any Lien incurred within 365
days of such acquisition or completion of such construction or improvement, at
the time of the incurrence of the Debt secured by such Lien), the aggregate
amount remaining unpaid on all Debt secured by Liens on such property, whether
or not assumed by the Company or a Restricted Subsidiary, shall not exceed the
lesser of (i) the cost of such acquisition, construction or improvement or (ii)
the fair market value at the time such property is acquired or constructed or
improvement of such property is completed, as the case may be, (as determined in
good faith by one or more officers of the Company or such Restricted Subsidiary
to whom authority to enter into the transaction has been delegated by the board
of directors of the Company or such Restricted Subsidiary), (3) the aggregate
principal amount of all Debt secured by such Liens would be permitted by the
limitation set forth in Section 10.1 and (4) at the time of such incurrence and
after giving effect thereto, no Default or Event of Default shall have occurred
and be continuing;        (h) any Lien existing on property of a Person
immediately prior to its being consolidated with or merged into the Company or a
Restricted Subsidiary or its becoming a Subsidiary, or any Lien existing on any
property acquired by the Company or any Restricted Subsidiary at the time such
property is so acquired (whether or not the Debt secured thereby shall have been
assumed); provided that (1) no such Lien shall have been created or assumed in
contemplation of such consolidation or merger or such Person becoming a
Subsidiary or such acquisition of property, (2) each such Lien shall extend
solely to the item or items of property so acquired and, if required by the
terms of the instrument originally creating such Lien, other property which is
an improvement to or is acquired for specific use in connection with such
acquired property, (3) the aggregate principal amount of all Debt secured by
such Liens would be permitted by the limitation set forth in Section 10.1 and
(4) at the time of such incurrence and after giving effect thereto, no Default
or Event of Default shall have occurred and be continuing;        (i) any
extensions, renewals or replacements of any Lien permitted by the preceding
paragraphs (f), (g) and (h) of this Section 10.3; provided that (1) no
additional property shall be encumbered by such Liens, (2) the unpaid principal
amount of the Debt or other obligations secured thereby shall not be increased
or the maturity thereof reduced and (3) at such time and immediately after
giving effect thereto, no Default or Event of Default shall have occurred and be
continuing; and        (j) other Liens not otherwise permitted by paragraphs (a)
through (i), inclusive, of this Section 10.3 securing Debt; provided that (1)
the aggregate principal amount of all Debt secured by such Liens shall be
permitted by the limitations set forth in Sections 10.1 and 10.2 and (2) at the
time of such incurrence and after giving effect thereto, no Default or Event of
Default shall have occurred or be continuing; provided further, that,
notwithstanding the foregoing, the Company will not, and will not permit any
Restricted Subsidiary to, grant any Liens securing any Debt outstanding under or
pursuant to the Bank Credit Agreement pursuant to this Section 10.3(j) unless
and until all obligations of the Company under this Agreement and the Notes
shall concurrently be secured equally and ratably with all such Debt pursuant to
documentation in form and substance reasonably satisfactory to the Required
Holders.    

 
 

 

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Section 10.4 Merger and Consolidation. The Company will not, and will not permit
any Restricted Subsidiary to, consolidate with or merge with any other Person or
convey, transfer or lease all or substantially all of its assets in a single
transaction or series of transactions to any Person; provided that:
 

 

      (a) any Restricted Subsidiary may (1) consolidate with or merge with, or
convey, transfer or lease all or substantially all of its assets in a single
transaction or series of transactions to, (i) the Company or another Restricted
Subsidiary so long as in any merger or consolidation involving the Company, the
Company shall be the surviving or continuing corporation or (ii) any other
Person so long as the surviving or continuing entity is a Restricted Subsidiary
or (2) convey, transfer or lease all or substantially all of its assets in
compliance with the provisions of Section 10.5; and           (b) the Company
may consolidate or merge with, or convey, transfer or lease all or substantially
all of its assets in a single transaction or series of transactions to, any
Person so long as:    

 

   (1) the successor formed by such consolidation or the survivor of such merger
or the Person that acquires by conveyance, transfer or lease all or
substantially all of the assets of the Company as an entirety, as the case may
be (the "Successor Corporation"), shall be a solvent entity organized and
existing under the laws of the United States of America, any State thereof or
the District of Columbia;        (2) if the Successor Corporation is not the
Company, (i) such Successor Corporation shall have executed and delivered to
each holder of Notes its assumption of the due and punctual performance and
observance of each covenant and condition of this Agreement and the Notes
(pursuant to such agreements and instruments as shall be reasonably satisfactory
to the Required Holders), (ii) the Successor Corporation shall have caused to be
delivered to each holder of Notes an opinion of independent counsel reasonably
acceptable to the Required Holders, to the effect that all agreements or
instruments effecting such assumption are enforceable in accordance with their
terms subject to customary exceptions and (iii) each Subsidiary Guarantor shall
have reaffirmed in writing its obligations under its Subsidiary Guaranty; and  
 

 
 

 
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   (3) immediately before and immediately after giving effect to such
transaction no Default or Event of Default shall have occurred and be
continuing.

 
 
   Section 10.5 Sales of Assets. The Company will not, and will not permit any
Restricted Subsidiary to, sell, lease or otherwise dispose of any substantial
part (as defined below) of the assets (including capital stock or similar equity
interests of Subsidiaries) of the Company and its Restricted Subsidiaries;
provided, however, that the Company or any Restricted Subsidiary may sell, lease
or otherwise dispose of assets constituting a substantial part of the assets of
the Company and its Restricted Subsidiaries if such assets are sold for fair
market value and, at such time and after giving effect thereto, no Default or
Event of Default shall have occurred and be continuing and an amount equal to
the net proceeds received from such sale, lease or other disposition (but only
with respect to that portion of such assets that exceeds the definition of
"substantial part" set forth below) shall be used within 365 days of such sale,
lease or disposition, in any combination:
 

      (a) to acquire productive assets used or useful in carrying on the
business of the Company and its Restricted Subsidiaries and having a fair market
value at least equal to the fair market value of such assets sold, leased or
otherwise disposed of; and/or           (b) to prepay or retire Senior Debt of
the Company and/or a Restricted Subsidiary, provided that in the course of
making such application the Company shall offer to prepay each outstanding Note
in accordance with Section 8.6 in a principal amount which equals the Ratable
Portion for such Note. If any holder of a Note fails to accept such offer of
prepayment, then the Company shall prepay or pay or cause to prepay or pay
additional Debt of the Company or a Restricted Subsidiary, other than
Subordinated Debt, in an amount equal to the Ratable Portion for such Note.    

 
    As used in this Section 10.5 and in Section 8.6, a sale, lease or other
disposition of assets shall be deemed to be a "substantial part" of the assets
of the Company and its Restricted Subsidiaries if the book value of such assets,
when added to the book value of all other assets sold, leased or otherwise
disposed of by the Company and its Restricted Subsidiaries during the period of
12 consecutive months ending on the date of such sale, lease or other
disposition, exceeds 10% of the book value of Consolidated Total Assets,
determined as of the end of the fiscal quarter immediately preceding such sale,
lease or other disposition; provided that there shall be excluded from any
determination of a "substantial part" (1) any sale, lease or other disposition
of assets in the ordinary course of business of the Company and its Restricted
Subsidiaries, (2) any sale, lease or other disposition of assets from the
Company to a Restricted Subsidiary or from any Restricted Subsidiary to the
Company or another Restricted Subsidiary and (3) any sale of property acquired
or constructed by the Company or any Restricted Subsidiary after the Closing
Date to any Person within 365 days following the acquisition or completion of
construction of such property by the Company or such Restricted Subsidiary if
the Company or such Restricted Subsidiary shall concurrently with such sale,
lease such property, as lessee.

   Section 10.6 Transactions with Affiliates. The Company will not, and will not
permit any Restricted Subsidiary to, enter into directly or indirectly any
material transaction or material group of related transactions (including,
without limitation, the purchase, lease, sale or exchange of properties of any
kind or the rendering of any service) with any Affiliate (other than the Company
or a Restricted Subsidiary), except pursuant to the reasonable requirements of
the Company's or such Restricted Subsidiary's business and upon fair and
reasonable terms that are not materially less favorable to the Company or such
Restricted Subsidiary than would be obtainable in a comparable arm's-length
transaction with a Person not an Affiliate.
 
 
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   Section 10.7 Line of Business. The Company will not, and will not permit any
Restricted Subsidiary to, engage in any business if, as a result, the general
nature of the business in which the Company and its Restricted Subsidiaries,
taken as a whole, would then be engaged would be substantially changed from the
general nature of the business in which the Company and its Restricted
Subsidiaries, taken as a whole, are engaged on the Closing Date.

   Section 10.8 Terrorism Sanctions Regulations. The Company will not, and will
not permit any Subsidiary to, (a) become a Person described or designated in the
Specially Designated Nationals and Blocked Persons List of the Office of Foreign
Assets Control or in Section 1 of the Anti-Terrorism Order or (b) knowingly
engage in any dealings or transactions with any such Person.

   Section 10.9 Limitation on Unrestricted Subsidiaries. The Company will not,
at any time, permit (a) the total assets of all Unrestricted Subsidiaries to
constitute more than 20% of the consolidated total assets of the Company and its
Subsidiaries or (b) the gross revenues of all Unrestricted Subsidiaries to
account for more than 20% of the consolidated gross revenues of the Company and
its Subsidiaries, in each case, determined in accordance with GAAP.

SECTION 11. EVENTS OF DEFAULT.

    An "Event of Default" shall exist if any of the following conditions or
events shall occur and be continuing:
 

     (a) the Company defaults in the payment of any principal or Make-Whole
Amount, if any, on any Note when the same becomes due and payable, whether at
maturity or at a date fixed for prepayment or by declaration or otherwise; or  
       (b) the Company defaults in the payment of any interest on any Note for
more than five Business Days after the same becomes due and payable; or         
(c) (1) the Company defaults in the performance of or compliance with any term
contained in Section 7.1(d) or Section 10 or (2) any Subsidiary Guarantor
defaults in the performance of or compliance with any term of the Subsidiary
Guaranty beyond any period of grace or cure period provided with respect
thereto; or          (d) the Company defaults in the performance of or
compliance with any term contained herein (other than those referred to in
paragraphs (a), (b) and (c) of this Section 11) and such default is not remedied
within 30 days after the earlier of (1) a Responsible Officer obtaining actual
knowledge of such default and (2) the Company receiving written notice of such
default from any holder of a Note (any such written notice to be identified as a
"notice of default" and to refer specifically to this paragraph (d) of Section
11); or    

 
 
 
 
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     (e) the Subsidiary Guaranty ceases to be a legally valid, binding and
enforceable obligation or contract of any Subsidiary Guarantor (other than a
Subsidiary Guarantor released in accordance with the terms of Section 2.3(b)),
or any Subsidiary Guarantor or any party by, through or on account of any such
Person, challenges the validity, binding nature or enforceability of the
Subsidiary Guaranty or such Subsidiary Guarantor's obligations thereunder; or  
       (f) any representation or warranty made in writing by or on behalf of the
Company or any Subsidiary Guarantor or by any officer of the Company or any
Subsidiary Guarantor in this Agreement, the Subsidiary Guaranty or in any
writing furnished in connection with the transactions contemplated hereby or
thereby proves to have been false or incorrect in any material respect on the
date as of which made; or          (g) (1) the Company or any Restricted
Subsidiary is in default (as principal or as guarantor or other surety) in the
payment of any principal of or premium or makewhole amount or interest on any
Debt other than the Notes that is outstanding in an aggregate principal amount
of at least $10,000,000 beyond any period of grace provided with respect
thereto, (2) the Company or any Restricted Subsidiary is in default in the
performance of or compliance with any term of any Material Loan Agreement or any
other condition exists, and as a consequence of such default or condition such
Debt has become, or has been declared (or one or more Persons are entitled to
declare such Debt to be), due and payable before its stated maturity or before
its regularly scheduled dates of payment, (3) the Company or any Restricted
Subsidiary is in default in the performance of or compliance with any term of
any instrument, mortgage, indenture or other agreement relating to any Debt
other than the Notes or a Material Loan Agreement in an aggregate principal
amount of at least $10,000,000 or any other condition exists, and as a
consequence of such default or condition such Debt has become, or has been
declared, due and payable before its stated maturity or before its regularly
scheduled dates of payment or (4) as a consequence of the occurrence or
continuation of any event or condition (other than the passage of time or the
right of the holder of Debt to convert such Debt into equity interests), (i) the
Company or any Restricted Subsidiary has become obligated to purchase or repay
Debt other than the Notes before its regular maturity or before its regularly
scheduled dates of payment in an aggregate outstanding principal amount of at
least $10,000,000 or (ii) in the case of a Material Loan Agreement, one or more
Persons has the right to require the Company or any Restricted Subsidiary to
purchase or repay such Debt; or          (h) the Company or any Material
Subsidiary (1) is generally not paying, or admits in writing its inability to
pay, its debts as they become due, (2) files, or consents by answer or otherwise
to the filing against it of, a petition for relief or reorganization or
arrangement or any other petition in bankruptcy, for liquidation or to take
advantage of any bankruptcy, insolvency, reorganization, moratorium or other
similar law of any jurisdiction, (3) makes an assignment for the benefit of its
creditors, (4) consents to the appointment of a custodian, receiver, trustee or
other officer with similar powers with respect to it or with respect to any
substantial part of its property, (5) is adjudicated as insolvent or to be
liquidated or (6) takes corporate action for the purpose of any of the
foregoing; or    

 

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     (i) a court or governmental authority of competent jurisdiction enters an
order appointing, without consent by the Company or any Material Subsidiary, a
custodian, receiver, trustee or other officer with similar powers with respect
to it or with respect to any substantial part of its property, or constituting
an order for relief or approving a petition for relief or reorganization or any
other petition in bankruptcy or for liquidation or to take advantage of any
bankruptcy or insolvency law of any jurisdiction, or ordering the dissolution,
winding-up or liquidation of the Company or any Material Subsidiary, or any such
petition shall be filed against the Company or any Material Subsidiary and such
petition shall not be dismissed or stayed within 60 days; or          (j) a
final judgment or judgments at any one time outstanding for the payment of money
aggregating in excess of $10,000,000 are rendered against one or more of the
Company or its Restricted Subsidiaries and which judgments are not, within 60
days after entry thereof, bonded, discharged or stayed pending appeal, or are
not discharged within 60 days after the expiration of such stay; or          (k)
if (1) any Plan shall fail to satisfy the minimum funding standards of ERISA or
the Code for any plan year or part thereof or a waiver of such standards or
extension of any amortization period is sought or granted under Section 412 of
the Code, (2) a notice of intent to terminate any Plan shall have been or is
reasonably expected to be filed with the PBGC or the PBGC shall have instituted
proceedings under Section 4042 of ERISA to terminate or appoint a trustee to
administer any Plan or the PBGC shall have notified the Company or any ERISA
Affiliate that a Plan may become a subject of any such proceedings, (3) the
aggregate "amount of unfunded benefit liabilities" (within the meaning of
Section 4001(a)(18) of ERISA) under all Plans, determined in accordance with
Title IV of ERISA, shall exceed $10,000,000 (4) the Company or any ERISA
Affiliate shall have incurred or is reasonably expected to incur any liability
pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of
the Code relating to employee benefit plans, (5) the Company or any ERISA
Affiliate withdraws from any Multiemployer Plan or (6) the Company or any
Subsidiary establishes or amends any employee welfare benefit plan that provides
post-employment welfare benefits in a manner that would increase the liability
of the Company or any Subsidiary thereunder; and any such event or events
described in clauses (1) through (6) above, either individually or together with
any other such event or events, would reasonably be expected to have a Material
Adverse Effect.    

 
As used in Section 11(k), the terms "employee benefit plan" and "employee
welfare benefit plan" shall have the respective meanings assigned to such terms
in Section 3 of ERISA.
 
 
 
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SECTION 12. REMEDIES ON DEFAULT, ETC.

   Section 12.1 Acceleration.

 

     (a) If an Event of Default with respect to the Company described in
paragraph (h) or (i) of Section 11 (other than an Event of Default described in
clause (1) of paragraph (h) or described in clause (6) of paragraph (h) by
virtue of the fact that such clause encompasses clause (1) of paragraph (h)) has
occurred, all the Notes then outstanding shall automatically become immediately
due and payable.          (b) If any other Event of Default has occurred and is
continuing, the Required Holders may at any time at their option, by notice or
notices to the Company, declare all the Notes then outstanding to be immediately
due and payable.         (c) If any Event of Default described in paragraph (a)
or (b) of Section 11 has occurred and is continuing with respect to any Notes,
any holder or holders of Notes at the time outstanding affected by such Event of
Default may at any time, at its or their option, by notice or notices to the
Company, declare all the Notes held by such holder or holders to be immediately
due and payable.    

 
    Upon any Note becoming due and payable under this Section 12.1, whether
automatically or by declaration, such Note will forthwith mature and the entire
unpaid principal amount of such Note, plus (1) all accrued and unpaid interest
thereon (including, but not limited to, interest accrued thereon at the Default
Rate) and (2) the applicable Make-Whole Amount, if any, determined in respect of
such principal amount (to the full extent permitted by applicable law), shall
all be immediately due and payable, in each and every case without presentment,
demand, protest or further notice, all of which are hereby waived. The Company
acknowledges, and the parties hereto agree, that each holder of a Note has the
right to maintain its investment in the Notes free from repayment by the Company
(except as herein specifically provided for), and that the provision for payment
of a Make-Whole Amount, if any, by the Company in the event that the Notes are
prepaid or are accelerated as a result of an Event of Default, is intended to
provide compensation for the deprivation of such right under such circumstances.

   Section 12.2 Other Remedies. If any Default or Event of Default has occurred
and is continuing, and irrespective of whether any Notes have become or have
been declared immediately due and payable under Section 12.1, the holder of any
Note at the time outstanding may proceed to protect and enforce the rights of
such holder by an action at law, suit in equity or other appropriate proceeding,
whether for the specific performance of any agreement contained herein or in any
Note, or for an injunction against a violation of any of the terms hereof or
thereof, or in aid of the exercise of any power granted hereby or thereby or by
law or otherwise.

   Section 12.3 Rescission. At any time after any Notes have been declared due
and payable pursuant to clause (b) or (c) of Section 12.1, the Required Holders,
by written notice to the Company, may rescind and annul any such declaration and
its consequences if (a) the Company has paid all overdue interest on the Notes,
all principal of and Make-Whole Amount, if any, on any Notes that are due and
payable and are unpaid other than by reason of such declaration, and all
interest on such overdue principal and Make-Whole Amount, if any, and (to the
extent permitted by applicable law) any overdue interest in respect of the
Notes, at the Default Rate, (b) neither the Company nor any other Person shall
have paid any amounts which have become due solely by reason of such
declaration, (c) all Events of Default and Defaults, other than non-payment of
amounts that have become due solely by reason of such declaration, have been
cured or have been waived pursuant to Section 17 and (d) no judgment or decree
has been entered for the payment of any monies due pursuant hereto or to any
Notes. No rescission and annulment under this Section 12.3 will extend to or
affect any subsequent Event of Default or Default or impair any right consequent
thereon.
 
 
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   Section 12.4 No Waivers or Election of Remedies, Expenses, Etc. No course of
dealing and no delay on the part of any holder of any Note in exercising any
right, power or remedy shall operate as a waiver thereof or otherwise prejudice
such holder's rights, powers or remedies. No right, power or remedy conferred by
this Agreement or by any Note upon any holder thereof shall be exclusive of any
other right, power or remedy referred to herein or therein or now or hereafter
available at law, in equity, by statute or otherwise. Without limiting the
obligations of the Company under Section 15, the Company will pay to the holder
of each Note on demand such further amount as shall be sufficient to cover all
costs and expenses of such holder incurred in any enforcement or collection
under this Section 12, including, without limitation, reasonable attorneys'
fees, expenses and disbursements.

SECTION 13. REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES.

   Section 13.1 Registration of Notes. The Company shall keep at its principal
executive office a register for the registration and registration of transfers
of Notes. The name and address of each holder of one or more Notes, each
transfer thereof and the name and address of each transferee of one or more
Notes shall be registered in such register. Prior to due presentment for
registration of transfer, the Person in whose name any Note shall be registered
shall be deemed and treated as the owner and holder thereof for all purposes
hereof, and the Company shall not be affected by any notice or knowledge to the
contrary. The Company shall give to any holder of a Note that is an
Institutional Investor promptly upon request therefor, a complete and correct
copy of the names and addresses of all registered holders of Notes.

   Section 13.2 Transfer and Exchange of Notes. Upon surrender of any Note to
the Company at the address and to the attention of the designated officer (all
as specified in Section 18(4)), for registration of transfer or exchange (and in
the case of a surrender for registration of transfer accompanied by a written
instrument of transfer duly executed by the registered holder of such Note or
such holder's attorney duly authorized in writing and accompanied by the
relevant name, address and other information for notices of each transferee of
such Note or part thereof), within 10 Business Days thereafter, the Company
shall execute and deliver, at the Company's expense (except as provided below),
one or more new Notes (as requested by the holder thereof) in exchange therefor,
in an aggregate principal amount equal to the unpaid principal amount of the
surrendered Note. Each such new Note shall be payable to such Person as such
holder may request and shall be substantially in the form of the Note originally
issued hereunder. Each such new Note shall be dated and bear interest from the
date to which interest shall have been paid on the surrendered Note or dated the
date of the surrendered Note if no interest shall have been paid thereon. The
Company may require payment of a sum sufficient to cover any stamp tax or
governmental charge imposed in respect of any such transfer of Notes. Notes
shall not be transferred in denominations of less than $1,000,000, provided that
if necessary to enable the registration of transfer by a holder of its entire
holding of Notes, one Note may be in a denomination of less than $1,000,000. Any
transferee, by its acceptance of a Note registered in its name (or the name of
its nominee), shall be deemed to have made the representation set forth in
Section 6.3, provided, that such holder may (in reliance upon information
provided by the Company, which shall not be unreasonably withheld) make a
representation to the effect that the purchase by such holder will not
constitute a non-exempt prohibited transaction under Section 406(a) of ERISA.
 
 
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   Section 13.3 Replacement of Notes. Upon receipt by the Company at the address
and to the attention of the designated officer (all as specified in Section
18(3)) of evidence reasonably satisfactory to it of the ownership of and the
loss, theft, destruction or mutilation of any Note (which evidence shall be, in
the case of an Institutional Investor, notice from such Institutional Investor
of such ownership and such loss, theft, destruction or mutilation), and
 

     (a) in the case of loss, theft or destruction, of indemnity reasonably
satisfactory to it (provided that if the holder of such Note is, or is a nominee
for, an original Purchaser, another holder of a Note with a minimum net worth of
at least $50,000,000 or a Qualified Institutional Buyer, such Person's own
unsecured agreement of indemnity shall be deemed to be satisfactory), or      
   (b) in the case of mutilation, upon surrender and cancellation thereof,

 
the Company at its own expense shall execute and deliver not more than 10
Business Days following satisfaction of such conditions, in lieu thereof, a new
Note, dated and bearing interest from the date to which interest shall have been
paid on such lost, stolen, destroyed or mutilated Note or dated the date of such
lost, stolen, destroyed or mutilated Note if no interest shall have been paid
thereon.

SECTION 14. PAYMENTS ON NOTES.

   Section 14.1 Place of Payment. Subject to Section 14.2, payments of
principal, Make-Whole Amount, if any, and interest becoming due and payable on
the Notes shall be made in New York, New York at the principal office of Bank of
America, N.A. in such jurisdiction. The Company may at any time, by notice to
each holder of a Note, change the place of payment of the Notes so long as such
place of payment shall be either the principal office of the Company in such
jurisdiction or the principal office of a bank or trust company in such
jurisdiction.

   Section 14.2 Home Office Payment. So long as any Purchaser or such Person's
nominee shall be the holder of any Note, and notwithstanding anything contained
in Section 14.1 or in such Note to the contrary, the Company will pay all sums
becoming due on such Note for principal, Make-Whole Amount, if any, and interest
by the method and at the address specified for such purpose for such Purchaser
on Schedule A hereto or by such other method or at such other address as such
Purchaser shall have from time to time specified to the Company in writing for
such purpose, without the presentation or surrender of such Note or the making
of any notation thereon, except that upon written request of the Company made
concurrently with or reasonably promptly after payment or prepayment in full of
any Note, such Purchaser shall surrender such Note for cancellation, reasonably
promptly after any such request, to the Company at its principal executive
office or at the place of payment most recently designated by the Company
pursuant to Section 14.1. Prior to any sale or other disposition of any Note
held by any Purchaser or it's nominee, such Person will, at its election, either
endorse thereon the amount of principal paid thereon and the last date to which
interest has been paid thereon or surrender such Note to the Company in exchange
for a new Note or Notes pursuant to Section 13.2. The Company will afford the
benefits of this Section 14.2 to any Institutional Investor that is the direct
or indirect transferee of any Note.
 
 
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SECTION 15. EXPENSES, ETC.

    Section 15.1 Transaction Expenses. Whether or not the transactions
contemplated hereby are consummated, the Company will pay all costs and expenses
(including reasonable attorneys' fees of a special counsel for the Purchasers
and, if reasonably required by the Required Holders, local or other counsel)
incurred by each Purchaser and each other holder of a Note in connection with
such transactions and in connection with any amendments, waivers or consents
under or in respect of this Agreement, the Subsidiary Guaranty or the Notes
(whether or not such amendment, waiver or consent becomes effective), including,
without limitation: (a) the reasonable costs and expenses incurred in enforcing
or defending (or determining whether or how to enforce or defend) any rights
under this Agreement, the Subsidiary Guaranty or the Notes or in responding to
any subpoena or other legal process or informal investigative demand issued in
connection with this Agreement, the Subsidiary Guaranty or the Notes, or by
reason of being a holder of any Note, (b) the reasonable costs and expenses,
including financial advisors' fees, incurred in connection with the insolvency
or bankruptcy of the Company or any Subsidiary or in connection with any
work-out or restructuring of the transactions contemplated hereby, by the
Subsidiary Guaranty and by the Notes and (c) the costs and expenses incurred in
connection with the initial filing of this Agreement and all related documents
and financial information with the SVO, provided that such costs and expenses
under this clause (c) shall not exceed $5,000. The Company will pay, and will
save each Purchaser and each other holder of a Note harmless from, all claims in
respect of any fees, costs or expenses if any, of brokers and finders (other
than those, if any, retained by a Purchaser or other holder in connection with
its purchase of its Notes).

    Section 15.2 Survival. The obligations of the Company under this Section 15
will survive the payment or transfer of any Note, the enforcement, amendment or
waiver of any provision of this Agreement or the Notes and the termination of
this Agreement.

SECTION 16. SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT.

    All representations and warranties contained herein shall survive the
execution and delivery of this Agreement and the Notes, the purchase or transfer
by any Purchaser of any Note or portion thereof or interest therein and the
payment of any Note and may be relied upon by any subsequent holder of any Note,
regardless of any investigation made at any time by or on behalf of any
Purchaser or any other holder of any Note. All statements contained in any
certificate or other instrument delivered by or on behalf of the Company
pursuant to this Agreement shall be deemed representations and warranties of the
Company under this Agreement. Subject to the preceding sentence, this Agreement
and the Notes embody the entire agreement and understanding between the
Purchasers and the Company and supersede all prior agreements and understandings
relating to the subject matter hereof.
 
 
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SECTION 17. AMENDMENT AND WAIVER.

   Section 17.1 Requirements. This Agreement and the Notes may be amended, and
the observance of any term hereof or of the Notes may be waived (either
retroactively or prospectively), with (and only with) the written consent of the
Company and the Required Holders, except that (1) no amendment or waiver of any
of the provisions of Section 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term
(as it is used in any such Section), will be effective as to any holder of Notes
unless consented to by such holder of Notes in writing and (2) no such amendment
or waiver may, without the written consent of all of the holders of Notes at the
time outstanding affected thereby, (i) subject to the provisions of Section 12
relating to acceleration or rescission, change the amount or time of any
prepayment or payment of principal of, or reduce the rate or change the time of
payment or method of computation of interest (if such change results in a
decrease in the interest rate) or of the applicable Make-Whole Amount on the
Notes, (ii) change the percentage of the principal amount of the Notes the
holders of which are required to consent to any such amendment or waiver or
(iii) amend any of Sections 8, 11(a), 11(b), 12, 17 or 20.

   Section 17.2 Solicitation of Holders of Notes.
 

     (a) Solicitation. The Company will provide each holder of the Notes
(irrespective of the amount of Notes then owned by it) with sufficient
information, sufficiently far in advance of the date a decision is required, to
enable such holder to make an informed and considered decision with respect to
any proposed amendment, waiver or consent in respect of any of the provisions
hereof, of the Subsidiary Guaranty or of the Notes. The Company will deliver
executed or true and correct copies of each amendment, waiver or consent
effected pursuant to the provisions of this Section 17 to each holder of
outstanding Notes promptly following the date on which it is executed and
delivered by, or receives the consent or approval of, the requisite holders of
Notes.          (b) Payment. The Company will not, directly or indirectly, pay
or cause to be paid any remuneration, whether by way of supplemental or
additional interest, fee or otherwise, or grant any security or provide other
credit support, to any holder of Notes as consideration for or as an inducement
to the entering into by any holder of Notes of any waiver or amendment of any of
the terms and provisions hereof, of the Subsidiary Guaranty or of any Note
unless such remuneration is concurrently paid, or security is concurrently
granted or other credit support is concurrently provided, on the same terms,
ratably to each holder of Notes then outstanding even if such holder did not
consent to such waiver or amendment.    

 
 
 
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     (c) Consent in Contemplation of Transfer. Any consent made pursuant to this
Section 17 by a holder of Notes that has transferred or has agreed to transfer
its Notes to the Company or any Affiliate and has provided or has agreed to
provide such written consent as a condition to such transfer shall be void and
of no force or effect except solely as to such holder, and any amendments
effected or waivers granted or to be effected or granted that would not have
been or would not be so effected or granted but for such consent (and the
consents of all other holders of Notes that were acquired under the same or
similar conditions) shall be void and of no force or effect except solely as to
such holder.

 
   Section 17.3 Binding Effect, Etc. Any amendment or waiver consented to as
provided in this Section 17 applies equally to all holders of Notes and is
binding upon them and upon each future holder of any Note and upon the Company
without regard to whether such Note has been marked to indicate such amendment
or waiver. No such amendment or waiver will extend to or affect any obligation,
covenant, agreement, Default or Event of Default not expressly amended or waived
or impair any right consequent thereon. No course of dealing between the Company
and the holder of any Note nor any delay in exercising any rights hereunder,
under the Subsidiary Guaranty or under any Note shall operate as a waiver of any
rights of any holder of such Note. As used herein, the term "this Agreement" and
references thereto shall mean this Agreement as it may from time to time be
amended or supplemented.

   Section 17.4 Notes Held by Company, Etc. Solely for the purpose of
determining whether the holders of the requisite percentage of the aggregate
principal amount of Notes then outstanding approved or consented to any
amendment, waiver or consent to be given under this Agreement, the Subsidiary
Guaranty or the Notes, or have directed the taking of any action provided
herein, in the Subsidiary Guaranty or in the Notes to be taken upon the
direction of the holders of a specified percentage of the aggregate principal
amount of Notes then outstanding, Notes directly or indirectly owned by the
Company or any of its Affiliates shall be deemed not to be outstanding.

SECTION 18. NOTICES.

    All notices and communications provided for hereunder shall be in writing
and sent (a) by telecopy if the sender on the same day sends a confirming copy
of such notice by a recognized overnight delivery service (charges prepaid) or
(b) by a recognized overnight delivery service (charges prepaid). Any such
notice must be sent:
 

     (1) if to any Purchaser or its nominee, to such Purchaser or its nominee at
the address specified for such communications in Schedule A to this Agreement,
or at such other address as such Purchaser or nominee shall have specified to
the Company in writing pursuant to this Section 18;          (2) if to any other
holder of any Note, to such holder at such address as such other holder shall
have specified to the Company in writing pursuant to this Section 18; or    

 

 
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     (3) if to the Company, to the Company at its address set forth at the
beginning hereof to the attention of its Chief Financial Officer or at such
other address as the Company shall have specified to the holder of each Note in
writing.

 
Notices under this Section 18 will be deemed given only when actually received.

SECTION 19. REPRODUCTION OF DOCUMENTS.

    This Agreement and all documents relating hereto, including, without
limitation, (a) consents, waivers and modifications that may hereafter be
executed, (b) documents received by any Purchaser on the Closing Date (except
the Notes themselves) and (c) financial statements, certificates and other
information previously or hereafter furnished to any holder of Notes, may be
reproduced by such holder by any photographic, photostatic, electronic, digital,
or other similar process and such holder may destroy any original document so
reproduced. The Company agrees and stipulates that, to the extent permitted by
applicable law, any such reproduction shall be admissible in evidence as the
original itself in any judicial or administrative proceeding (whether or not the
original is in existence and whether or not such reproduction was made by such
holder of Notes in the regular course of business) and any enlargement,
facsimile or further reproduction of such reproduction shall likewise be
admissible in evidence. This Section 19 shall not prohibit the Company or any
other holder of Notes from contesting any such reproduction to the same extent
that it could contest the original, or from introducing evidence to demonstrate
the inaccuracy of any such reproduction.

SECTION 20. CONFIDENTIAL INFORMATION.

    For the purposes of this Section 20, "Confidential Information" shall mean
information delivered to any Purchaser by or on behalf of the Company or any
Subsidiary in connection with the transactions contemplated by or otherwise
pursuant to this Agreement that is proprietary in nature and that was clearly
marked or labeled or otherwise adequately identified when received by such
Purchaser as being confidential information of the Company or such Subsidiary,
provided that such term does not include information that (a) was publicly known
or otherwise known to such Purchaser prior to the time of such disclosure, (b)
subsequently becomes publicly known through no act or omission by such Purchaser
or any Person acting on such Purchaser's behalf, (c) otherwise becomes known to
such Purchaser other than through disclosure by the Company or any Subsidiary or
(d) constitutes financial statements delivered to such Purchaser under Section
7.1 that are otherwise publicly available. Each Purchaser will maintain the
confidentiality of such Confidential Information in accordance with procedures
adopted by such Purchaser in good faith to protect confidential information of
third parties delivered to such Purchaser, provided that such Purchaser may
deliver or disclose Confidential Information to (1) such Purchaser's directors,
trustees, officers, employees, agents, attorneys and affiliates (to the extent
such disclosure reasonably relates to the administration of the investment
represented by such Purchaser's), (2) such Purchaser's financial advisors and
other professional advisors who agree to hold confidential the Confidential
Information substantially in accordance with the terms of this Section 20, (3)
any other holder of any Note, (4) any Institutional Investor to which such
Purchaser sells or offers to sell such Note or any part thereof or any
participation therein (if such Person has agreed in writing prior to its receipt
of such Confidential Information to be bound by the provisions of this Section
20), (5) any Person from which such Purchaser offers to purchase any security of
the Company (if such Person has agreed in writing prior to its receipt of such
Confidential Information to be bound by the provisions of this Section 20), (6)
any federal or state regulatory authority having jurisdiction over such
Purchaser, (7) the NAIC or the SVO or, in each case, any similar organization,
or any nationally recognized rating agency that requires access to information
about such Purchaser's investment portfolio or (8) any other Person to which
such delivery or disclosure may be necessary or appropriate (i) to effect
compliance with any law, rule, regulation or order applicable to such Purchaser,
(ii) in response to any subpoena or other legal process, (iii) in connection
with any litigation to which such Purchaser is a party or (iv) if an Event of
Default has occurred and is continuing, to the extent such Purchaser may
reasonably determine such delivery and disclosure to be necessary or appropriate
in the enforcement or for the protection of the rights and remedies under such
Purchaser's Notes, the Subsidiary Guaranty and this Agreement. Each holder of a
Note, by its acceptance of a Note, will be deemed to have agreed to be bound by
and to be entitled to the benefits of this Section 20 as though it were a party
to this Agreement. On reasonable request by the Company in connection with the
delivery to any holder of a Note of information required to be delivered to such
holder under this Agreement or requested by such holder (other than a holder
that is a party to this Agreement or its nominee), such holder will enter into
an agreement with the Company embodying the provisions of this Section 20.
 
 
 
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SECTION 21. SUBSTITUTION OF PURCHASER.

    Each Purchaser shall have the right to substitute any one of its Affiliates
as the purchaser of the Notes that it has agreed to purchase hereunder, by
written notice to the Company, which notice shall be signed by both such
Purchaser and such Affiliate, shall contain such Affiliate's agreement to be
bound by this Agreement and shall contain a confirmation by such Affiliate of
the accuracy with respect to it of the representations set forth in Section 6.
Upon receipt of such notice, any reference to such Purchaser in this Agreement
(other than in this Section 21), shall be deemed to refer to such Affiliate in
lieu of such original Purchaser. In the event that such Affiliate is so
substituted as a Purchaser hereunder and such Affiliate thereafter transfers to
such original Purchaser all of the Notes then held by such Affiliate, upon
receipt by the Company of notice of such transfer, any reference to such
Affiliate as a "Purchaser" in this Agreement (other than in this Section 21),
shall no longer be deemed to refer to such Affiliate, but shall refer to such
original Purchaser, and such original Purchaser shall again have all the rights
of an original holder of the Notes under this Agreement.

SECTION 22. MISCELLANEOUS.

   Section 22.1 Successors and Assigns. All covenants and other agreements
contained in this Agreement by or on behalf of any of the parties hereto bind
and inure to the benefit of their respective successors and assigns (including,
without limitation, any subsequent holder of a Note) whether so expressed or
not.

   Section 22.2 Payments Due on Non-Business Days. Anything in this Agreement or
the Notes to the contrary notwithstanding (but without limiting the requirement
in Section 8.4 that the notice of any optional prepayment specify a Business Day
as the date fixed for such prepayment), any payment of principal of or
Make-Whole Amount, if any, or interest on any Note that is due on a date other
than a Business Day shall be made on the next succeeding Business Day without
including the additional days elapsed in the computation of the interest payable
on such next succeeding Business Day; provided that if the maturity date of any
Note is a date other than a Business Day, the payment otherwise due on such
maturity date shall be made on the next succeeding Business Day and shall
include the additional days elapsed in the computation of interest payable on
such next succeeding Business Day.
 
 
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   Section 22.3 Accounting Terms. All accounting terms used herein which are not
expressly defined in this Agreement have the meanings respectively given to them
in accordance with GAAP. Except as otherwise specifically provided herein, (a)
all computations made pursuant to this Agreement shall be made in accordance
with GAAP and (b) all financial statements shall be prepared in accordance with
GAAP. Notwithstanding anything to the contrary contained in this Agreement, for
purposes of determining compliance with Section 10, any election by the Company
to measure an item of Debt using fair value as permitted by GAAP shall be
disregarded and such determination shall be made as if such election had not
been made.

   Section 22.4 Severability. Any provision of this Agreement that is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall (to the full extent permitted by law)
not invalidate or render unenforceable such provision in any other jurisdiction.

   Section 22.5 Construction. Each covenant contained herein shall be construed
(absent express provision to the contrary) as being independent of each other
covenant contained herein, so that compliance with any one covenant shall not
(absent such an express contrary provision) be deemed to excuse compliance with
any other covenant. Where any provision herein refers to action to be taken by
any Person, or which such Person is prohibited from taking, such provision shall
be applicable whether such action is taken directly or indirectly by such
Person.

    For the avoidance of doubt, all Schedules and Exhibits attached to this
Agreement shall be deemed to be a part hereof.

   Section 22.6 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original but all of which together shall
constitute one instrument. Each counterpart may consist of a number of copies
hereof, each signed by less than all, but together signed by all, of the parties
hereto.

    Section 22.7 Governing Law. This Agreement shall be construed and enforced
in accordance with, and the rights of the parties shall be governed by, the law
of the State of New York excluding choice-of-law principles of the law of such
State that would permit the application of the laws of a jurisdiction other than
such State.
 
 
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    Section 22.8 Jurisdiction and Process; Waiver of Jury Trial.
 

     (a) The Company irrevocably submits to the non-exclusive jurisdiction of
any New York State or federal court sitting in the Borough of Manhattan, The
City of New York, over any suit, action or proceeding arising out of or relating
to this Agreement or the Notes. To the fullest extent permitted by applicable
law, the Company irrevocably waives and agrees not to assert, by way of motion,
as a defense or otherwise, any claim that it is not subject to the jurisdiction
of any such court, any objection that it may now or hereafter have to the laying
of the venue of any such suit, action or proceeding brought in any such court
and any claim that any such suit, action or proceeding brought in any such court
has been brought in an inconvenient forum.          (b) The Company consents to
process being served by or on behalf of any holder of Notes in any suit, action
or proceeding of the nature referred to in Section 22.8(a) by mailing a copy
thereof by registered or certified mail (or any substantially similar form of
mail), postage prepaid, return receipt requested, to it at its address specified
in Section 18(3) or at such other address of which such holder shall then have
been notified pursuant to said Section. The Company agrees that such service
upon receipt (1) shall be deemed in every respect effective service of process
upon it in any such suit, action or proceeding and (2) shall, to the fullest
extent permitted by applicable law, be taken and held to be valid personal
service upon and personal delivery to it. Notices hereunder shall be
conclusively presumed received as evidenced by a delivery receipt furnished by
the United States Postal Service or any reputable commercial delivery service.  
       (c) Nothing in this Section 22.8 shall affect the right of any holder of
a Note to serve process in any manner permitted by law, or limit any right that
the holders of any of the Notes may have to bring proceedings against the
Company in the courts of any appropriate jurisdiction or to enforce in any
lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.
         (d) THE PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN ANY ACTION BROUGHT
ON OR WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OTHER DOCUMENT EXECUTED
IN CONNECTION HEREWITH OR THEREWITH.

 
* * * * *
 
 
 
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The execution hereof by the Purchasers shall constitute a contract among the
Company and the Purchasers for the uses and purposes hereinabove set forth.

 

   Very truly yours,        AMCOL INTERNATIONAL CORPORATION            By /s/
Donald W. Pearson                                                  Name: Donald
W. Pearson          Title: Chief Financial Officer

 
 
 
 
 
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Accepted as of the date first written above.

 

   THE LINCOLN NATIONAL LIFE INSURANCE COMPANY    By: Delaware Investment
Advisors,    a series of Delaware Management Business    Trust, Attorney in Fact
           By /s/ Jayson
Bronchetti                                                           
        Name: Jayson Bronchetti           Title: Vice President          
 LINCOLN LIFE & ANNUITY COMPANY OF NEW YORK    By: Delaware Investment Advisors,
   a series of Delaware Management Business    Trust, Attorney in Fact          
 By /s/ Jayson Bronchetti          Name: Jayson Bronchetti          Title: Vice
President                    

 
 
 
 
 
 
 
 
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DEFINED TERMS

    As used herein, the following terms have the respective meanings set forth
below or set forth in the Section hereof following such term:
   

    "Acquisition" shall mean any transaction or series of related transactions
(a) for the purpose of or resulting, directly or indirectly, in (1) the
acquisition by the Company or a Restricted Subsidiary of all or substantially
all of the assets of a Person, or of a business unit or division of a Person,
(2) the acquisition by the Company or a Restricted Subsidiary of in excess of
50% of the capital stock, partnership interests, membership interests or other
equity of any Person (other than a Person that is a Subsidiary), or otherwise
causing any Person to become a Subsidiary or (3) a merger or consolidation or
any other combination with another Person (other than a Person that is a
Subsidiary), provided that the Company or a Restricted Subsidiary is the
surviving entity and (b) where the aggregate fair market value of the assets or
equity so acquired or, in the case of a merger, consolidation or other
combination, so contributed shall exceed $20,000,000.

    "Affiliate" shall mean, at any time, and with respect to any Person, any
other Person that at such time directly or indirectly through one or more
intermediaries Controls, or is Controlled by, or is under common Control with,
such first Person and, with respect to the Company, shall include any Person
beneficially owning or holding, directly or indirectly, 10% or more of any class
of voting or equity interests of the Company or any Subsidiary or any Person of
which the Company and its Subsidiaries beneficially own or hold, in the
aggregate, directly or indirectly, 10% or more of any class of voting or equity
interests. As used in this definition, "Control" means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities, by
contract or otherwise. Unless the context otherwise clearly requires, any
reference to an "Affiliate" is a reference to an Affiliate of the Company.

    "Agreement" is defined in the first paragraph of this Agreement.

    "Anti-Terrorism Order" shall mean Executive Order No. 13,224 of September
24, 2001, Blocking Property and Prohibiting Transactions with Persons Who
Commit, Threaten to Commit or Support Terrorism, 66 U.S. Fed. Reg. 49, 079
(2001), as amended.

    "Applicable Rate" shall mean 5.46% per annum, provided that during any
period in which the Company has elected to increase the Maximum Leverage Ratio
to 3.75 to 1.00 pursuant to Section 10.1, "Applicable Rate" shall mean 5.96% per
annum during such period.

    "Bank Credit Agreement" shall mean that certain Credit Agreement dated as of
November 10, 2005 among the Company, Certain Borrowing Subsidiaries, the
Guarantors from time to time party thereto, the Lenders from time to time party
thereto, and Harris N.A., as Administrative Agent as amended by that certain
First Amendment to Credit Agreement dated as of June 14, 2006, that certain
Second Amendment to Credit Agreement dated as of March 9, 2007, that certain
Third Amendment to Credit Agreement dated as of May 20, 2008 and that certain
Forth Amendment to Credit Agreement dated as of September 18, 2009 and as the
same B-2 may be further amended or restated, joined, supplemented or otherwise
modified from time to time, and any renewals, extensions or replacements
thereof.
 
SCHEDULE B
(to Note Purchase Agreement)

 

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    "Business Day" shall mean any day other than a Saturday, a Sunday or a day
on which commercial banks in Chicago, Illinois or New York, New York are
required or authorized to be closed.

    "Capital Lease" shall mean, at any time, a lease with respect to which the
lessee is required concurrently to recognize the acquisition of an asset and the
incurrence of a liability in accordance with GAAP.

    "Capital Lease Obligation" shall mean, with respect to any Person and a
Capital Lease, the amount of the obligation of such Person as the lessee under
such Capital Lease which would, in accordance with GAAP, appear as a liability
on a balance sheet of such Person.

    "Change in Control" is defined in Section 8.7(h).

    "Change in Control Proposed Prepayment Date" is defined in Section 8.7(c).

    "Closing Date" is defined in Section 3.

    "Code" shall mean the Internal Revenue Code of 1986, as amended from time to
time, and the rules and regulations promulgated thereunder from time to time.

    "Collateral Release" is defined in Section 2.3(b).

    "Company" is defined in the first paragraph of this Agreement and includes
any Successor Corporation.

    "Confidential Information" is defined in Section 20.

    "Consolidated Debt" shall mean, as of any date of determination, the total
of all Debt of the Company and its Restricted Subsidiaries outstanding on such
date, after eliminating all offsetting debits and credits between the Company
and its Restricted Subsidiaries and all other items required to be eliminated in
the course of the preparation of consolidated financial statements of the
Company and its Restricted Subsidiaries in accordance with GAAP.

    "Consolidated EBITDA" shall mean, for any period, Consolidated Net Income
for such period, plus, to the extent deducted in computing such Consolidated Net
Income and without duplication, (a) depreciation, depletion, if any, and
amortization expense for such period, (b) Consolidated Interest Expense for such
period, (c) income tax expense for such period and (d) other non-cash charges
for such period, all as determined in accordance with GAAP.

    "Consolidated Interest Expense" shall mean, for any period, the gross
interest expense of the Company and its Restricted Subsidiaries (including
imputed interest on Capital Lease Obligations) deducted in the calculation of
Consolidated Net Income for such period, after eliminating offsetting debits and
credits between the Company and its Restricted Subsidiaries and all other items
required to be eliminated in the course of the preparation of consolidated
financial statements of the Company and its Restricted Subsidiaries in
accordance with GAAP.
 
B-2

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    "Consolidated Net Income" shall mean, for any period, the net income (or
loss) of the Company and its Restricted Subsidiaries for such period (taken as a
cumulative whole), determined in accordance with GAAP after eliminating
offsetting debits and credits between the Company and its Restricted
Subsidiaries and all other items required to be eliminated in the course of the
preparation of consolidated financial statements of the Company and its
Restricted Subsidiaries in accordance with GAAP, as adjusted for net income or
loss attributable to noncontrolling interests.

    "Consolidated Total Assets" shall mean, as of any date of determination, the
total amount of all assets of the Company and its Restricted Subsidiaries, that
would be shown on a consolidated balance sheet of the Company and its Restricted
Subsidiaries as of such date prepared in accordance with GAAP.

    "Control Event" is defined in Section 8.7(i).

    "Debt" shall mean, with respect to any Person, without duplication,
 

   (a) its liabilities for borrowed money;        (b) its liabilities for the
deferred purchase price of property acquired by such Person (excluding accounts
payable and other accrued liabilities arising in the ordinary course of business
but including, without limitation, all liabilities created or arising under any
conditional sale or other title retention agreement with respect to any such
property);        (c) its Capital Lease Obligations;        (d) liabilities for
borrowed money secured by any Lien with respect to any property owned by such
Person (whether or not it has assumed or otherwise become liable for such
liabilities); and        (e) Guarantees by such Person with respect to
liabilities of a type described in any of clauses (a) through (d) hereof.    

 
    "Default" shall mean an event or condition the occurrence or existence of
which would, with the lapse of time or the giving of notice or both, become an
Event of Default.

    "Default Rate" shall mean, with respect to any Note, that rate of interest
that is the greater of (1) 2.00% per annum above the then applicable Applicable
Rate and (2) 2.00% per annum above the rate of interest publicly announced by
Bank of America, N.A. in New York, New York as its "reference" rate.

    "Disclosure Documents" is defined in Section 5.3.

    "Dollars" or "$" shall mean lawful money of the United States of America.
 
B-3

--------------------------------------------------------------------------------

 
    "Domestic Subsidiary" shall mean any Subsidiary that is organized under the
laws of any state or commonwealth of the United States of America.

    "Environmental Laws" shall mean any and all federal, state, local, and
foreign statutes, laws, regulations, ordinances, rules, judgments, orders,
decrees, permits, concessions, grants, franchises, licenses, agreements or
governmental restrictions relating to pollution and the protection of the
environment or the release of any materials into the environment, including but
not limited to those related to hazardous substances or wastes, air emissions
and discharges to waste or public systems.

    "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the rules and regulations promulgated thereunder
from time to time in effect.

    "ERISA Affiliate" shall mean any trade or business (whether or not
incorporated) that is treated as a single employer together with the Company
under Section 414 of the Code.

    "Event of Default" is defined in Section 11.

    "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
 
    "Foreign Subsidiary" shall mean any Subsidiary that is not a Domestic
Subsidiary.

    "GAAP" shall mean generally accepted accounting principles as in effect from
time to time in the United States of America provided that, if the Company or
the Required Holders notify the other party that it or they wish to amend any
negative covenants (or any definition hereof) to eliminate the effect of any
change in generally accepted accounting principles on the operation of such
covenant or definition, then the Company's compliance with such covenant or the
meaning of such definition shall be determined on the basis of generally
accepted accounting principles in effect immediately before the relevant change
in generally accepted accounting principles became effective, until either such
notice is withdrawn or such covenant is amended in a manner satisfactory to the
Company and the Required Holders.

    "Governmental Authority" shall mean

       (a) the government of
 

   (1) the United States of America or any state or other political subdivision
thereof, or        (2) any other jurisdiction in which the Company or any
Restricted Subsidiary conducts all or any part of its business, or which has
jurisdiction over any properties of the Company or any Restricted Subsidiary, or

 
       (b) any entity exercising executive, legislative, judicial, regulatory or
administrative functions of, or pertaining to, any such government.
 
 
B-4

--------------------------------------------------------------------------------

 
    "Guaranty" shall mean, with respect to any Person, any obligation (except
the endorsement in the ordinary course of business of negotiable instruments for
deposit or collection) of such Person guaranteeing or in effect guaranteeing any
Debt, dividend or other obligation of any other Person in any manner, whether
directly or indirectly, including, without limitation, obligations incurred
through an agreement, contingent or otherwise, by such Person:
 

     (a) to purchase such Debt or obligation or any property constituting
security therefor primarily for the purpose of assuring the owner of such Debt
or obligation of the ability of any other Person to make payment of such Debt or
obligation;          (b) to advance or supply funds (1) for the purchase or
payment of such Debt or obligation or (2) to maintain any working capital or
other balance sheet condition or any income statement condition of any other
Person or otherwise to advance or make available funds for the purchase or
payment of such Debt or obligation;          (c) to lease properties or to
purchase properties or services primarily for the purpose of assuring the owner
of such Debt or obligation of the ability of any other Person to make payment of
the Debt or obligation; or          (d) otherwise to assure the owner of such
Debt or obligation against loss in respect thereof.    

 
    In any computation of the Debt or other liabilities of the obligor under any
Guaranty, the Debt or other obligations that are the subject of such Guaranty
shall be assumed to be direct obligations of such obligor, provided that the
amount of such Debt outstanding for purposes of this Agreement shall not exceed
the maximum amount of Debt that is the subject of such Guaranty.

    "Guaranty Supplement" is defined in Section 9.9(a).

    "Hazardous Material" shall mean any and all pollutants, toxic or hazardous
wastes or other substances that might pose a hazard to health and safety, the
removal of which may be required or the generation, manufacture, refining,
production, processing, treatment, storage, handling, transportation, transfer,
use, disposal, release, discharge, spillage, seepage or filtration of which is
or shall be restricted, prohibited or penalized by any applicable law including,
but not limited to, asbestos, urea formaldehyde foam insulation, polychlorinated
biphenyls, petroleum, petroleum products, lead based paint, radon gas or similar
restricted, prohibited or penalized substances.

    "holder" shall mean, with respect to any Note, the Person in whose name such
Note is registered in the register maintained by the Company pursuant to Section
13.1.

    "INHAM Exemption" is defined in Section 6.3(e).

    "Institutional Investor" shall mean (a) any original purchaser of a Note,
(b) any holder of a Note holding (together with one or more of its affiliates)
more than $2,000,000 of the aggregate principal amount of the Notes then
outstanding, (c) any bank, trust company, savings and loan association or other
financial institution, any pension plan, any investment company, any insurance
company, any broker or dealer, or any other similar financial institution or
entity, regardless of legal form and (d) any Related Fund of any holder of any
Note.
 
B-5

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    "Lien" shall mean, with respect to any Person, any mortgage, lien, pledge,
charge, security interest or other encumbrance, or any interest or title of any
vendor, lessor, lender or other secured party to or of such Person under any
conditional sale or other title retention agreement (other than an operating
lease) or Capital Lease, upon or with respect to any property or asset of such
Person (including, in the case of stock, shareholder agreements, voting trust
agreements and all similar arrangements).

    "Make-Whole Amount" shall have the meaning set forth in Section 8.8.

    "Material" shall mean material in relation to the business, operations,
affairs, financial condition, assets or properties of the Company and its
Restricted Subsidiaries, taken as a whole.

    "Material Adverse Effect" shall mean a material adverse effect on (a) the
business, operations, affairs, financial condition, assets or properties of the
Company and its Restricted Subsidiaries, taken as a whole, (b) the ability of
the Company to perform its obligations under this Agreement and the Notes, (c)
the ability of the Subsidiary Guarantors, taken as a whole, to perform their
obligations under the Subsidiary Guaranty or (d) the validity or enforceability
of this Agreement, the Subsidiary Guaranty or the Notes.

    "Material Loan Agreement" shall mean each of the Bank Credit Agreement, the
2007 Note Agreement, the Series 2007-A Notes or any other instrument, mortgage,
indenture or other agreement relating to any Debt other than the Notes in an
aggregate principal amount of at least $25,000,000.

    "Material Subsidiary" shall mean, at any time, (a) any Subsidiary Guarantor
and (b) any other Restricted Subsidiary of the Company which, together with all
other Restricted Subsidiaries of such Restricted Subsidiary, accounts for more
than (a) 5% of Consolidated Total Assets or (b) 5% of consolidated gross revenue
of the Company and its Restricted Subsidiaries.

    "Maximum Leverage Ratio" is defined in Section 10.1.

    "Multiemployer Plan" shall mean any Plan that is a "multiemployer plan" (as
such term is defined in Section 4001(a)(3) of ERISA).

    "NAIC" shall mean the National Association of Insurance Commissioners or any
successor thereto.

    "NAIC Annual Statement" is defined in Section 6.3(a).

    "Notes" is defined in Section 1.

    "Notice of Election to Increase Leverage Ratio" shall mean a notice, dated
not more than 10 Business Days after the date of completion of the Acquisition
described therein, signed by a Senior Financial Officer of the Company, which
shall state (a) that the Company or a Restricted Subsidiary has completed an
Acquisition, (b) a description of such Acquisition, (c) the date of completion
of such Acquisition, (d) the fair market value of the assets acquired or
contributed in such Acquisition, (e) that immediately before giving effect to
such Acquisition no Default or Event of Default shall have occurred and be
continuing, (e) that by such notice the Company has elected to increase the
Maximum Leverage Ratio to 3.75 to 1.00 for the fiscal quarter in which such
Acquisition occurred and for each of the three consecutive fiscal quarters
immediately thereafter and (f) that immediately after giving effect to such
increase in the Maximum Leverage Ratio no Default or Event of Default shall have
occurred and be continuing.
 
 
B-6

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    "Officer's Certificate" with respect to any Person shall mean a certificate
of a Senior Financial Officer or of any other officer of such Person whose
responsibilities extend to the subject matter of such certificate.

    "PBGC" shall mean the Pension Benefit Guaranty Corporation referred to and
defined in ERISA or any successor thereto.

    "Person" shall mean an individual, partnership, corporation, limited
liability company, association, trust, unincorporated organization, business
entity or Governmental Authority.

    "Plan" shall mean an "employee benefit plan" (as defined in Section 3(3) of
ERISA) subject to Title I of ERISA that is or, within the preceding five years,
has been established or maintained, or to which contributions are or, within the
preceding five years, have been made or required to be made, by the Company or
any ERISA Affiliate or with respect to which the Company or any ERISA Affiliate
may have any liability.

    "Priority Debt" shall mean (without duplication), as of the date of any
determination thereof, the sum of (a) all unsecured Debt of Restricted
Subsidiaries (including all Guaranties of Debt of the Company) but excluding (1)
unsecured Debt owing to the Company or any other Restricted Subsidiary, (2)
unsecured Debt outstanding at the time such Person became a Restricted
Subsidiary (other than an Unrestricted Subsidiary which is designated or
redesignated as a Restricted Subsidiary pursuant to Section 9.8), provided that
such Debt shall have not been incurred in contemplation of such Person becoming
a Restricted Subsidiary, (3) unsecured Debt outstanding on December 31, 2009
that was directly borrowed under the Bank Credit Agreement by a Restricted
Subsidiary that is a Foreign Subsidiary and which is identified on Schedule 5.15
and (4) all Guaranties of Debt of the Company by any Restricted Subsidiary which
has also guaranteed the Notes pursuant to the Subsidiary Guaranty and (b) all
Debt of the Company and its Restricted Subsidiaries secured by Liens other than
Debt secured by Liens permitted by subparagraphs (a) through (i), inclusive, of
Section 10.3.

    "property" or "properties" shall mean, unless otherwise specifically
limited, real or personal property of any kind, tangible or intangible, choate
or inchoate.

    "PTE" is defined in Section 6.3(a).

    "Purchasers" shall mean the purchasers of the Notes named in Schedule A.
 
 
B-7

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    "QPAM Exemption" is defined in Section 6.3(d).

    "Qualified Institutional Buyer" shall mean any Person who is a qualified
institutional buyer within the meaning of such term as set forth in Rule
144(a)(1) under the Securities Act.

    "Ratable Portion" for any Note shall mean an amount equal to the product of
(a) the net proceeds from a sale of assets being applied to the payment or
prepayment of Debt pursuant to Section 10.5(b) multiplied by (b) a fraction, the
numerator of which is the aggregate outstanding principal amount of such Note
and the denominator of which is the aggregate outstanding principal amount of
all Senior Debt.
 
    "Related Fund" shall mean, with respect to any holder of any Note, any fund
or entity that (a) invests in securities or bank loans and (b) is advised or
managed by such holder, the same investment advisor as such holder or by an
affiliate of such holder or such investment advisor.

    "Required Holders" shall mean, at any time, the holders of more than 50% in
principal amount of the Notes at the time outstanding (exclusive of Notes then
owned by the Company or any of its Affiliates and any Notes held by parties who
are contractually required to abstain from voting with respect to matters
affecting the holders of the Notes).

    "Responsible Officer" shall mean any Senior Financial Officer and any other
officer of the Company with responsibility for the administration of the
relevant portion of this Agreement.

    "Restricted Subsidiary" shall mean (a) any Subsidiary that is a Subsidiary
Guarantor and (b) any other Subsidiary (1) in which at least a majority of the
voting securities are owned by the Company and/or one or more wholly-owned
Restricted Subsidiaries and (2) which the Company has not designated as an
Unrestricted Subsidiary on the Closing Date or by notice in writing given to the
holders of Notes in accordance with the provisions of Section 9.8.

    "Sale of Assets Prepayment Date" is defined in Section 8.6(a).

    "Sale of Assets Prepayment Event" is defined in Section 8.6(a).

    "SEC" shall mean the Securities and Exchange Commission of the United
States, or any successor thereto.

    "Securities Act" shall mean the Securities Act of 1933, as amended from time
to time.

    "Senior Debt" shall mean, as of any date of determination thereof, all
Consolidated Debt, other than Subordinated Debt.

    "Senior Financial Officer" with respect to any Person shall mean the chief
financial officer, director of treasury, principal accounting officer,
treasurer, assistant treasurer or controller of such Person.

    "Series 2007-A Notes" shall mean the Company's $75,000,000 aggregate
principal amount Series 2007-A Notes consisting of (a) $45,000,000 in aggregate
principal amount of its Series 2007-A Adjustable Fixed Rated Guaranteed Senior
Notes, Tranche 1, due April 2, 2017 and (b) $30,000,000 in aggregate principal
amount of its Series 2007-A Adjustable Floating Rate Guaranteed Senior Notes,
Tranche 2, due April 2, 2017 issued under and pursuant to the 2007 Note
Agreement.
 
B-8

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    "Source" is defined in Section 6.3.

    "Subordinated Debt" shall mean all unsecured Debt of the Company or a
Subsidiary Guarantor, as the case may be, which shall contain or have applicable
thereto subordination provisions providing for the subordination thereof to
other Debt of the Company (including, without limitation, the obligations of the
Company under this Agreement or the Notes) or such Subsidiary Guarantor
(including, without limitation, the obligations of such Subsidiary Guarantor
under the Subsidiary Guaranty).

    "Subsidiary" shall mean, as to any Person, any corporation, association or
other business entity in which such Person or one or more of its Subsidiaries or
such Person and one or more of its Subsidiaries owns sufficient equity or voting
interests to enable it or them (as a group) ordinarily, in the absence of
contingencies, to elect a majority of the directors (or Persons performing
similar functions) of such entity, and any partnership or joint venture if more
than a 50% interest in the profits or capital thereof is owned by such Person or
one or more of its Subsidiaries or such Person and one or more of its
Subsidiaries (unless such partnership can and does ordinarily take major
business actions without the prior approval of such Person or one or more of its
Subsidiaries). Unless the context otherwise clearly requires, any reference to a
"Subsidiary" is a reference to a Subsidiary of the Company.

    "Subsidiary Guarantor" shall mean each Subsidiary which is party to the
Subsidiary Guaranty.

    "Subsidiary Guaranty" is defined in Section 2.2(a).

    "Successor Corporation" is defined in Section 10.4(b)(1).

    "SVO" shall mean the Securities Valuation Office of the NAIC or any
successor to such office.

    "2007 Note Agreement" shall mean that certain Note Purchase Agreement dated
as of April 2, 2007 by and among the Company and the purchasers named in
Schedule A thereto as the same may be amended, restated, supplemented or
otherwise modified from time to time, and any renewals, extensions or
replacements thereof.

    "Unrestricted Subsidiary" shall mean any Subsidiary so designated by the
Company on the Closing Date or by notice in writing given to the holders of
Notes in accordance with the provisions of Section 9.8.

    "USA Patriot Act" shall mean United States Public Law 107-56, Uniting and
Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct
 
 
 
B-9

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Terrorism (USA PATRIOT ACT) Act of 2001, as amended from time to time, and the
rules and regulations promulgated thereunder from time to time in effect.

 
 
 
 
 
 
 
 
 
B-10

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FORM OF 5.46%GUARANTEED SENIOR NOTE

AMCOL INTERNATIONAL CORPORATION

5.46% Guaranteed Senior Note, due April 29, 2020
 
 

 

 No. R-__    ________ __, 20__ $__________    PPN 02341W A#0

 
                                                                                                 
    FOR VALUE RECEIVED, the undersigned, AMCOL INTERNATIONAL CORPORATION (herein
called the "Company"), a corporation organized and existing under the laws of
the State of Delaware, hereby promises to pay to _____________________ or
registered assigns, the principal sum of ______________ DOLLARS (or so much
thereof as shall not have been prepaid) on April 29, 2020 with interest
(computed on the basis of a 360-day year of twelve 30-day months) (a) on the
unpaid balance hereof at the Applicable Rate (as hereinafter defined) from the
date hereof, payable semiannually, on the twenty-ninth day of April and October
in each year and at maturity, commencing with the April 29 or October 29 next
succeeding the date hereof, until the principal hereof shall have become due and
payable, and (b) to the extent permitted by law, on any overdue payment of
interest, on any overdue payment (including any overdue prepayment) of principal
and on any overdue payment of any Make-Whole Amount, payable semiannually as
aforesaid (or, at the option of the registered holder hereof, on demand), at a
rate per annum equal to the Default Rate. "Applicable Rate" shall mean 5.46% per
annum, provided that during any period in which the Company has elected to
increase the Maximum Leverage Ratio to 3.75 to 1.00 pursuant to Section 10.1 of
the Note Purchase Agreement, "Applicable Rate" shall mean 5.96% per annum during
such period.

    Payments of principal of, interest on and any Make-Whole Amount with respect
to this Note are to be made in lawful money of the United States of America at
the principal office of Bank of America, N.A. in New York, New York or at such
other place as the Company shall have designated by written notice to the holder
of this Note as provided in the Note Purchase Agreement referred to below.

    This Note is one of a series of 5.46% Guaranteed Senior Notes (herein called
the "Notes") issued pursuant to the Note Purchase Agreement, dated as of April
29, 2010 (as from time to time amended, supplemented or otherwise modified, the
"Note Purchase Agreement"), between the Company and the respective Purchasers
named therein and is entitled to the benefits thereof. Each holder of this Note
will be deemed, by its acceptance hereof, to have (1) agreed to the
confidentiality provisions set forth in Section 20 of the Note Purchase
Agreement and (2) made the representations set forth in Sections 6.2 and 6.3 of
the Note Purchase Agreement, provided, that such holder may (in reliance upon
information provided by the Company, which shall not be unreasonably withheld)
make a representation to the effect that the purchase by such holder of this
Note will not constitute a non-exempt prohibited transaction under Section
406(a) of ERISA. Unless otherwise indicated, capitalized terms used in this Note
shall have the respective meanings ascribed to such terms in the Note Purchase
Agreement.
 
 

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    This Note is a registered Note and, as provided in the Note Purchase
Agreement, upon surrender of this Note for registration of transfer, duly
endorsed, or accompanied by a written instrument of transfer duly executed, by
the registered holder hereof or such holder's attorney duly authorized in
writing, a new Note for a like principal amount will be issued to, and
registered in the name of, the transferee. Prior to due presentment for
registration of transfer, the Company may treat the Person in whose name this
Note is registered as the owner hereof for the purpose of receiving payment and
for all other purposes, and the Company will not be affected by any notice to
the contrary.

    This Note is subject to prepayment, in whole or from time to time in part,
at the times and on the terms specified in the Note Purchase Agreement, but not
otherwise.

    If an Event of Default occurs and is continuing, the principal of this Note
may be declared or otherwise become due and payable in the manner, at the price
(including any applicable Make- Whole Amount) and with the effect provided in
the Note Purchase Agreement.

    This Note shall be construed and enforced in accordance with, and the rights
of the issuer and holder hereof shall be governed by, the law of the State of
New York excluding choice-oflaw principles of the law of such State that would
require the application of the laws of a jurisdiction other than such State.
 
 

   AMCOL INTERNATIONAL CORPORATION          
 By                                                                                     
                   Name:         Title:

 
 
 
 
 
E-1-2
 
 
 
 
 

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