exv10w73






Exhibit 10.73




 





INDENTURE




Dated as of October 21, 2009



Among



LIONS GATE ENTERTAINMENT INC.



LIONS GATE ENTERTAINMENT CORP.



THE OTHER GUARANTORS NAMED ON THE SIGNATURE PAGES HERETO



and



U.S. BANK NATIONAL ASSOCIATION,



as Trustee



10.25% SENIOR SECURED SECOND-PRIORITY NOTES DUE 2016



 




 









 





TABLE OF CONTENTS




	 	 	 	 	 	 	 
	 	 	 	 	Page	 
	ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE	 	 	1	 
	 
	 	 	 	 	 	 
	Section 1.01
	 	Definitions	 	 	1	 
	Section 1.02
	 	Other Definitions	 	 	43	 
	Section 1.03
	 	Rules of Construction	 	 	44	 
	Section 1.04
	 	Incorporation by Reference of Trust Indenture Act	 	 	45	 
	Section 1.05
	 	Acts of Holders	 	 	45	 
	 
	 	 	 	 	 	 
	ARTICLE 2 THE NOTES	 	 	47	 
	 
	 	 	 	 	 	 
	Section 2.01
	 	Form and Dating; Terms	 	 	47	 
	Section 2.02
	 	Execution and Authentication	 	 	48	 
	Section 2.03
	 	Registrar and Paying Agent	 	 	48	 
	Section 2.04
	 	Paying Agent to Hold Money in Trust	 	 	48	 
	Section 2.05
	 	Holder Lists	 	 	49	 
	Section 2.06
	 	Transfer and Exchange	 	 	49	 
	Section 2.07
	 	Replacement Notes	 	 	50	 
	Section 2.08
	 	Outstanding Notes	 	 	50	 
	Section 2.09
	 	Treasury Notes	 	 	51	 
	Section 2.10
	 	Temporary Notes	 	 	51	 
	Section 2.11
	 	Cancellation	 	 	51	 
	Section 2.12
	 	Defaulted Interest	 	 	51	 
	Section 2.13
	 	CUSIP and ISIN Numbers	 	 	52	 
	 
	 	 	 	 	 	 
	ARTICLE 3 REDEMPTION	 	 	52	 
	 
	 	 	 	 	 	 
	Section 3.01
	 	Notices to Trustee	 	 	52	 
	Section 3.02
	 	Selection of Notes to Be Redeemed or Purchased	 	 	52	 
	Section 3.03
	 	Notice of Redemption	 	 	53	 
	Section 3.04
	 	Effect of Notice of Redemption	 	 	54	 
	Section 3.05
	 	Deposit of Redemption or Purchase Price	 	 	54	 
	Section 3.06
	 	Notes Redeemed or Purchased in Part	 	 	54	 
	Section 3.07
	 	Optional Redemption	 	 	54	 
	Section 3.08
	 	Mandatory Redemption	 	 	55	 
	Section 3.09
	 	Offers to Repurchase by Application of Excess Proceeds	 	 	55	 
	 
	 	 	 	 	 	 
	ARTICLE 4 COVENANTS	 	 	57	 
	 
	 	 	 	 	 	 
	Section 4.01
	 	Payment of Notes; Additional Amounts	 	 	57	 
	Section 4.02
	 	Maintenance of Office or Agency	 	 	59	 
	Section 4.03
	 	Reports and Other Information	 	 	59	 
	Section 4.04
	 	Compliance Certificate	 	 	60	 
	Section 4.05
	 	Taxes	 	 	61	 
	Section 4.06
	 	Stay, Extension and Usury Laws	 	 	61	 
	Section 4.07
	 	Limitation on Restricted Payments	 	 	61	 
	Section 4.08
	 	Limitation on Restrictions on Distribution from Restricted Subsidiaries	 	 	66	 
	Section 4.09
	 	Limitation on Indebtedness	 	 	68	 






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	 	 	 	 	Page	 
	Section 4.10
	 	Asset Sales	 	 	73	 
	Section 4.11
	 	Transactions with Affiliates	 	 	75	 
	Section 4.12
	 	Limitation on Liens	 	 	77	 
	Section 4.13
	 	Corporate Existence	 	 	78	 
	Section 4.14
	 	Offer to Repurchase Upon Change of Control	 	 	79	 
	Section 4.15
	 	Limitation on Sale of Capital Stock of Restricted Subsidiaries	 	 	81	 
	Section 4.16
	 	Limitation on Sale/Leaseback Transactions	 	 	81	 
	Section 4.17
	 	Additional Subsidiary Guarantees	 	 	81	 
	Section 4.18
	 	Maintenance of Properties and Insurance	 	 	83	 
	Section 4.19
	 	Further Assurances; Collateral Inspections	 	 	83	 
	Section 4.20
	 	Effectiveness of Covenants	 	 	83	 
	 
	 	 	 	 	 	 
	ARTICLE 5 SUCCESSORS	 	 	84	 
	 
	 	 	 	 	 	 
	Section 5.01
	 	Merger, Consolidation or Sale of All or Substantially All Assets	 	 	84	 
	Section 5.02
	 	Successor Entity Substituted	 	 	87	 
	 
	 	 	 	 	 	 
	ARTICLE 6 DEFAULTS AND REMEDIES	 	 	88	 
	 
	 	 	 	 	 	 
	Section 6.01
	 	Events of Default	 	 	88	 
	Section 6.02
	 	Acceleration	 	 	91	 
	Section 6.03
	 	Other Remedies	 	 	91	 
	Section 6.04
	 	Waiver of Past Defaults	 	 	91	 
	Section 6.05
	 	Control by Majority	 	 	92	 
	Section 6.06
	 	Limitation on Suits	 	 	92	 
	Section 6.07
	 	Rights of Holders to Receive Payment	 	 	92	 
	Section 6.08
	 	Collection Suit by Trustee	 	 	93	 
	Section 6.09
	 	Restoration of Rights and Remedies	 	 	93	 
	Section 6.10
	 	Rights and Remedies Cumulative	 	 	93	 
	Section 6.11
	 	Delay or Omission Not Waiver	 	 	93	 
	Section 6.12
	 	Trustee May File Proofs of Claim	 	 	93	 
	Section 6.13
	 	Priorities	 	 	94	 
	Section 6.14
	 	Undertaking for Costs	 	 	94	 
	 
	 	 	 	 	 	 
	ARTICLE 7 TRUSTEE	 	 	94	 
	 
	 	 	 	 	 	 
	Section 7.01
	 	Duties of Trustee	 	 	94	 
	Section 7.02
	 	Rights of Trustee	 	 	95	 
	Section 7.03
	 	Individual Rights of Trustee	 	 	96	 
	Section 7.04
	 	Trustee's Disclaimer	 	 	97	 
	Section 7.05
	 	Notice of Defaults	 	 	97	 
	Section 7.06
	 	Reports by Trustee to Holders of the Notes	 	 	97	 
	Section 7.07
	 	Compensation and Indemnity	 	 	97	 
	Section 7.08
	 	Replacement of Trustee	 	 	98	 
	Section 7.09
	 	Successor Trustee by Merger, etc.	 	 	99	 
	Section 7.10
	 	Eligibility; Disqualification	 	 	99	 
	Section 7.11
	 	Preferential Collection of Claims Against the Issuer	 	 	99	 
	Section 7.12
	 	Quebec Power of Attorney	 	 	99	 






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	 	 	 	 	Page	 
	ARTICLE 8 LEGAL DEFEASANCE AND COVENANT DEFEASANCE	 	 	100	 
	 
	 	 	 	 	 	 
	Section 8.01
	 	Option to Effect Legal Defeasance or Covenant Defeasance	 	 	100	 
	Section 8.02
	 	Legal Defeasance and Discharge	 	 	100	 
	Section 8.03
	 	Covenant Defeasance	 	 	100	 
	Section 8.04
	 	Conditions to Legal or Covenant Defeasance	 	 	101	 
	Section 8.05
	 	Deposited Money and Government
Securities to Be Held in Trust; Other Miscellaneous Provisions	 	 	102	 
	Section 8.06
	 	Repayment to the Issuer	 	 	103	 
	Section 8.07
	 	Reinstatement	 	 	103	 
	 
	 	 	 	 	 	 
	ARTICLE 9 AMENDMENT, SUPPLEMENT AND WAIVER	 	 	103	 
	 
	 	 	 	 	 	 
	Section 9.01
	 	Without Consent of Holders	 	 	103	 
	Section 9.02
	 	With Consent of Holders	 	 	105	 
	Section 9.03
	 	Compliance with Trust Indenture Act	 	 	106	 
	Section 9.04
	 	Revocation and Effect of Consents	 	 	106	 
	Section 9.05
	 	Notation on or Exchange of Notes	 	 	107	 
	Section 9.06
	 	Trustee to Sign Amendments, etc	 	 	107	 
	Section 9.07
	 	Payment for Consent	 	 	107	 
	 
	 	 	 	 	 	 
	ARTICLE 10 [RESERVED]	 	 	107	 
	 
	 	 	 	 	 	 
	ARTICLE 11 GUARANTEES	 	 	107	 
	 
	 	 	 	 	 	 
	Section 11.01
	 	Notes Guarantee	 	 	107	 
	Section 11.02
	 	Limitation on Guarantor Liability	 	 	109	 
	Section 11.03
	 	Execution and Delivery	 	 	109	 
	Section 11.04
	 	Subrogation	 	 	110	 
	Section 11.05
	 	Benefits Acknowledged	 	 	110	 
	Section 11.06
	 	Release of Notes Guarantees	 	 	110	 
	 
	 	 	 	 	 	 
	ARTICLE 12 SECURITY ARRANGEMENTS	 	 	111	 
	 
	 	 	 	 	 	 
	Section 12.01
	 	Security	 	 	111	 
	Section 12.02
	 	Authorization of Actions to Be Taken	 	 	112	 
	Section 12.03
	 	Determinations Relating to Collateral	 	 	113	 
	Section 12.04
	 	Release of Liens	 	 	114	 
	Section 12.05
	 	Agreement for the Benefit of Holders of First-Priority Liens	 	 	115	 
	Section 12.06
	 	Notes and Notes Guarantees Not Subordinated	 	 	115	 
	Section 12.07
	 	Limitation on Duty of Trustee in Respect of Collateral	 	 	115	 
	Section 12.08
	 	Additional Intercreditor Agreements	 	 	116	 
	 
	 	 	 	 	 	 
	ARTICLE 13 SATISFACTION AND DISCHARGE	 	 	116	 
	 
	 	 	 	 	 	 
	Section 13.01
	 	Satisfaction and Discharge	 	 	116	 
	Section 13.02
	 	Application of Trust Money	 	 	117	 






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	 	 	 	 	Page	 
	ARTICLE 14 MISCELLANEOUS	 	 	117	 
	 
	 	 	 	 	 	 
	Section 14.01
	 	Trust Indenture Act Controls	 	 	117	 
	Section 14.02
	 	Notices	 	 	117	 
	Section 14.03
	 	Communication by Holders with Other Holders	 	 	119	 
	Section 14.04
	 	Certificate and Opinion as to Conditions Precedent	 	 	119	 
	Section 14.05
	 	Statements Required in Certificate or Opinion	 	 	120	 
	Section 14.06
	 	Rules by Trustee and Agents	 	 	120	 
	Section 14.07
	 	No Personal Liability of Directors, Officers, Employees and Stockholders	 	 	120	 
	Section 14.08
	 	Governing Law	 	 	120	 
	Section 14.09
	 	Waiver of Jury Trial	 	 	120	 
	Section 14.10
	 	Force Majeure	 	 	120	 
	Section 14.11
	 	No Adverse Interpretation of Other Agreements	 	 	121	 
	Section 14.12
	 	Successors	 	 	121	 
	Section 14.13
	 	Severability	 	 	121	 
	Section 14.14
	 	Counterpart Originals	 	 	121	 
	Section 14.15
	 	Table of Contents, Headings, etc.	 	 	121	 
	Section 14.16
	 	U.S.A. PATRIOT Act	 	 	121	 
	Section 14.17
	 	Consent to Jurisdiction; Appointment of Agent for Service of Process	 	 	121	 
	Section 14.18
	 	Judgment Currency	 	 	122	 
	 
	 	 	 	 	 	 
	Appendix A
	 	Provisions Relating to Initial Notes and Additional Notes	 	 	 	 
	 
	 	 	 	 	 	 
	Schedule 1
	 	Intercreditor Agreements	 	 	 	 
	Schedule 2
	 	Unrestricted Subsidiaries	 	 	 	 
	 
	 	 	 	 	 	 
	Exhibit A
	 	Form of Note	 	 	 	 
	Exhibit B
	 	Form of Transferee Letter of Representation	 	 	 	 
	Exhibit C
	 	Form of Supplemental Indenture to Be Delivered by Subsequent Guarantors	 	 	 	 






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EXHIBIT
10.73


          INDENTURE, dated as of October 21, 2009, among Lions Gate Entertainment Inc., a Delaware
corporation (the “Issuer”), Lions Gate Entertainment Corp., a corporation organized under
the laws of the Province of British Columbia (“Parent”), the other Guarantors (as defined
herein) listed on the signature pages hereto and U.S. Bank National Association, as Trustee.




W
I T N E S S E T H



          WHEREAS, the Issuer has duly authorized the creation of and issue of $236,000,000 aggregate
principal amount of 10.25% Senior Secured Second-Priority Notes due 2016 (the “Initial
Notes”); and




          WHEREAS, Parent and each of the other Guarantors has duly authorized the execution and
delivery of this Indenture;




          WHEREAS, each of the Issuer, Parent and the other Guarantors has received good and valuable
consideration for the execution and delivery of this Indenture, the Notes and the Notes Guarantees
(as defined below), as the case may be;




          WHEREAS, each of Parent and the other Guarantors will derive substantial direct and indirect
benefits from the issuance of the Notes;




          WHEREAS, all necessary acts and things have been done to make: (1) the Notes, when duly issued
and executed by the Issuer and authenticated and delivered hereunder, the legal, valid and binding
obligations of the Issuer; (2) this Indenture a legal, valid and binding agreement of the Issuer in
accordance with the terms of this Indenture; and (3) this Indenture, including the Notes Guarantees
hereunder, a legal, valid and binding agreement of each of the Guarantors in accordance with the
terms of this Indenture;




          NOW, THEREFORE, the Issuer, the Guarantors and the Trustee agree as follows for the benefit of
each other and for the equal and ratable benefit of the Holders of the Notes.




ARTICLE 1




DEFINITIONS AND INCORPORATION BY REFERENCE


Section 1.01 Definitions.




          “Acceptable Domestic Account Debtor” means (1) a Person who is an “Acceptable Domestic
Account Debtor” as defined pursuant to the Senior Credit Facility in effect on the Issue Date (as
such Senior Credit Facility may be amended, restated, or otherwise modified from time to time in a
manner which is not materially adverse when taken as a whole to the Holders in the good faith
judgment of the Issuer as certified to the Trustee in an Officers’ Certificate), for so long as
such Person is an “Acceptable Domestic Account Debtor” as so defined, or (2) a Person whose general
unsecured obligations have an Investment Grade Rating.




          “Acceptable Foreign Account Debtor” means (1) a Person who is an “Acceptable Foreign
Account Debtor” as defined pursuant to the Senior Credit Facility in effect on the Issue Date (as
such Senior Credit Facility may be amended, restated, or otherwise modified from time to time in a
manner which is not materially adverse when taken as a whole to the Holders in the good faith
judgment of the Issuer as certified to the Trustee in an Officers’ Certificate), for so long as
such Person is an “Acceptable Foreign Account Debtor” as so defined, or (2) a Person whose general
unsecured obligations have an Investment Grade Rating.







 









 








          “Acceptable L/C” means any commercial bank that has (or which is the principal
operating subsidiary of a holding Issuer which has) as of the time such letter of credit is issued,
public debt outstanding with a rating of at least “A” (or the equivalent of an “A”) from one of the
nationally recognized debt rating agencies.




          “Acceptable Major Account Debtor” means (1) a Person who is an “Acceptable Major
Account Debtor” as defined pursuant to the Senior Credit Facility in effect on the Issue Date (as
such Senior Credit Facility may be amended, restated, or otherwise modified from time to time in a
manner which is not materially adverse when taken as a whole to the Holders in the good faith
judgment of the Issuer as certified to the Trustee in an Officers’ Certificate), for so long as
such Person is an “Acceptable Major Account Debtor” as so defined, or (2) a Person whose general
unsecured obligations have an Investment Grade Rating.




          “Acceptable Obligor” means any of the Acceptable Domestic Account Debtors, the
Acceptable Foreign Account Debtors and the Acceptable Major Account Debtors.




          “Acceptable Tax Credit” means (a) the amount (as determined in good faith by the Board
of Directors of the Issuer) that the Issuer or any LGEI Subsidiary Guarantor is entitled to or can
reasonably be expected to be entitled to receive as a refund of tax with respect to any tax credit
pursuant to the provisions of the law of any State in the United States administering tax credit
programs, the provisions of the federal law of the United States or the provisions of the federal
law of Canada or the law of any Canadian Province (an “Other Provincial Act”) or the
provisions of the law of the United Kingdom (“U.K. Law”) or the provisions of the law of
Australia (“Australia Law”) or the provisions of the law of South Africa and any country,
state or territory whose long term general obligation debt at that time has an Investment Grade
Rating (“Other Foreign Law”) or, (b) if the Issuer or such LGEI Subsidiary Guarantor has
entered into a definitive, arm’s length, purchase and sale agreement for the sale of the tax credit
to a third-party, such lesser amount as may have been agreed by the Issuer or such LGEI Subsidiary
Guarantor with the third-party in such definitive purchase and sale agreement in respect of any
such tax credits; in either case, which meets the following criteria:





     (1) the tax credit is in respect of an item of Product that has commenced principal
photography and that does not remain Uncompleted beyond the time period, if any, permitted
under the applicable State law, federal U.S. law, federal Canadian law, Other Provincial
Act, U.K. Law, Australia Law or Other Foreign Law with respect to such credit;




     (2) the Issuer shall have obtained a Completion Guaranty for any item of Product (other
than a television series) for which the Issuer or LGEI Subsidiary Guarantor has a current
financial exposure (as opposed to a Negative Pick-up Obligation) or is otherwise subject to
the economic risk of Completion if the Production Exposure exceeds $20,000,000 for any such
individual item of Product;




     (3) the Issuer or LGEI Subsidiary Guarantor has applied for and received an eligibility
certificate in respect of such tax credit for such item of Product (if applicable) and has
requested to be provided with an estimated amount of the tax credit to which the Issuer or
Restricted Subsidiary will be entitled;




     (4) the amount of a refund of tax with respect to a tax credit that the Issuer or LGEI
Subsidiary Guarantor is entitled or can reasonably be expected to be entitled to receive is
net of any tax, interest, penalty or other amount payable to any Governmental Authority by
the Issuer or LGEI Subsidiary Guarantor under the applicable State law, federal U.S. law,
federal Canadian law, Other Provincial Act, U.K. Law, Australia Law or Other Foreign Law, as
applicable, or any other amount payable by the Issuer or LGEI Subsidiary Guarantor to any
Governmental



-2-









 






Authority to which the credit can be or has been applied by set-off or in any other
manner whatsoever by any Governmental Authority;




     (5) where the amount of a tax credit in respect of an item of Product or, in the case
of a television series, any one season of such series, exceeds the sum of $1,000,000, the
Issuer has obtained an opinion or review letter from an independent accounting firm as to
the estimated amount of the tax credit that the Issuer or LGEI Subsidiary Guarantor is
entitled to receive;




     (6) the amount of a refund of tax with respect to a tax credit that the Issuer or LGEI
Subsidiary Guarantor is entitled or can reasonably be expected to be entitled to receive is
net of expenses relating to the filing of the eligibility certificate with the applicable
Governmental Authority or any other filings or procedures necessary to receive such tax
credit which have already been paid prior to determination of the amount of such Acceptable
Tax Credit; and




     (7) the Collateral Agent (for itself and the benefit of the Holders of the Notes) has a
second priority perfected security interest in the tax credit and notice of such security
interest in accordance with any applicable requirements of the applicable State law, federal
U.S. law, federal Canadian law, Other Provincial Act, U.K. Law, Australia Law or Other
Foreign Law, as applicable, and any other relevant Governmental
Authority, provided, however, that such requirement shall not apply if the Issuer or LGEI Subsidiary Guarantor
has entered into a definitive, arm’s length, purchase and sale agreement for the sale of the
tax credit to a third-party;


provided, however, that (x) to the extent that circumstances arise or occur that would cause the
actual tax credit to be less than the amount that would be determined based on any estimated
amounts as set forth on any applications for any certificate described in clause (3) of this
definition, the Acceptable Tax Credit shall be reduced to reflect the revised estimate and (y) an
Acceptable Tax Credit shall cease to be an Acceptable Tax Credit (A) if the Issuer or LGEI
Subsidiary Guarantor has not filed its return of income and all other certificates, forms and
documents required under the applicable legislation to be filed together therewith in order to
claim such tax credit within six months from the end of the tax year of the Issuer or such LGEI
Subsidiary Guarantor; provided, however, that such requirement shall not apply if the Issuer or
such LGEI Subsidiary Guarantor has entered into a definitive, arms’ length, purchase and sale
agreement for the sale of the tax credit to a third-party, or (B) if the relevant Governmental
Authority has (i) denied the Issuer’s or LGEI Subsidiary Guarantor’s application of the applicable
certificate set forth in clause (iii) of this definition, (ii) not issued the applicable
certificate within fifteen months following the Issuer’s or LGEI Subsidiary Guarantor’s application
thereof or (iii) revoked or notified the Issuer or LGEI Subsidiary Guarantor of their intention to
revoke such certificate.




          “Acquired Indebtedness” means, with respect to any specified Person, Indebtedness (1)
of a Person or any of its Subsidiaries existing at the time such Person becomes a Restricted
Subsidiary or (2) assumed in connection with the acquisition of assets from such Person, in each
case whether or not Incurred by such Person in connection with, or in anticipation or contemplation
of, such Person becoming a Restricted Subsidiary or such acquisition, and Indebtedness secured by a
Lien encumbering any asset acquired by such specified Person. Acquired Indebtedness shall be deemed
to have been Incurred, with respect to clause (1) of the preceding sentence, on the date such
Person becomes a Restricted Subsidiary and, with respect to clause (2) of the preceding sentence,
on the date of consummation of such acquisition of assets.




          “Additional Assets” means:





     (1) any property, plant, equipment or other assets (excluding working capital or
current assets for the avoidance of doubt) to be used by the Issuer or a Restricted
Subsidiary in a Related Business; or



-3-









 






     (2) an investment in any one or more businesses or capital expenditures (which for
purposes of this definition, shall include the acquisition of any item of Product), in each
case used or useful to a Related Business, provided,
however, if such investment is in the
form of the acquisition of the Capital Stock of a Person, such Person becomes a Restricted
Subsidiary as a result of the acquisition of such Capital Stock by the Issuer or a
Restricted Subsidiary or if such Person is already a Restricted Subsidiary, in an increase
in the percentage ownership of such Person by the Issuer or a Restricted Subsidiary;


provided,
however, that, in the case of clause (2), such Restricted Subsidiary is primarily engaged
in a Related Business.




          “Adjusted EBITDA” means, with respect to any Person for any period, the Consolidated
Net Income of such Person for such period plus, without duplication, to the extent the same was
deducted in calculating Consolidated Net Income:





     (1) Consolidated Taxes; plus




     (2) Consolidated Interest Expense; plus




     (3) Consolidated Adjusted Charges; plus




     (4) restructuring charges or expenses, including one-time charges (including legal and
other professional fees and expenses incurred prior to the Issue Date related to shareholder
activism charges); provided that with respect to each restructuring charge or one-time
charge, the Issuer shall have delivered to the Trustee an Officers’ Certificate specifying
and quantifying such expense or charge and stating that such expense or charge is a
restructuring charge or one-time charge, as the case may be; plus




     (5) non-operating expenses (minus non-operating income);




less, without duplication,




     (6) non-cash items increasing Consolidated Net Income for such period (excluding the
recognition of deferred revenue or any items which represent the reversal of any accrual of,
or cash reserve for, anticipated cash charges in any prior period and any items for which
cash was received in a prior period).



          “Administrative Agent” means JPMorgan Chase Bank, N.A., a national banking
association, as agent for the lenders under the Senior Credit Facility, or any successor agent.




          “Additional Notes” means additional Notes (other than the Initial Notes) issued from
time to time under this Indenture in accordance with Sections 2.01 and 4.09.




          “Affiliate” of any specified Person means any other Person, directly or indirectly,
controlling or controlled by or under direct or indirect common control with such specified Person.
For the purposes of this definition, “control” (including, with correlative meanings, the terms
“controlling,” “controlled by” and “under common control with”) when used with respect to any
Person means possession, directly or indirectly, of the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to
the foregoing; provided that exclusively for purposes of Section 4.10 and Section 4.11, beneficial
ownership of 10% or more of the Voting Stock of a Person shall be deemed to be control.







-4-









 








          “Affiliated Group” means a group of Persons, each of which is an Affiliate (other than
by reason of having common directors or officers) of some other Person in the group.




          “Allowable Amount” means, with respect to any Acceptable Obligor, (1) if such
Acceptable Obligor is an “Acceptable Obligor” as defined under the Senior Credit Facility in effect
on the Issue Date (as such Senior Credit Facility may be amended, restated, or otherwise modified
from time to time in a manner which is not materially adverse when taken as a whole to the Holders
in the good faith judgment of the Issuer as certified to the Trustee in an Officers’ Certificate)
for which an “Allowable Amount” is in effect thereunder, such Allowable Amount and (2) otherwise,
$25,000,000.




          “Approved Completion Guarantor” means (1) a Person who is an “Approved Completion
Guarantor” as defined pursuant to the Senior Credit Facility as in effect on the Issue Date, for so
long as such Person is an “Approved Completion Guarantor” as so defined, or (2) a completion
guarantor with an Investment Grade Rating.




          “Agent” means any Registrar or Paying Agent.




          “Applicable Premium” means, with respect to a Note at any redemption date, the greater
of:





     (1) 1.0% of the principal amount of such Note; and




     (2) the excess of (a) the present value at such time of (i) the redemption price of
such Note at November 1, 2013 (such redemption price being described in Section 3.07(d))
plus (ii) all required interest payments due on such Note through November 1, 2013, computed
using a discount rate equal to the Treasury Rate plus 50 basis points, over (b) the
principal amount of such Note on such redemption date.



          “Asset Sale” means any direct or indirect sale, lease (other than an operating lease
entered into in the ordinary course of business), transfer, issuance or other disposition, or a
series of related sales, leases, transfers, issuances or dispositions that are part of a common
plan, of shares of Capital Stock of a Subsidiary (other than directors’ qualifying shares),
property or other assets (each referred to for the purposes of this definition as a “disposition”)
by the Issuer or any of the Restricted Subsidiaries, including any disposition by means of a
merger, consolidation or similar transaction.




          Notwithstanding the preceding, the following items shall not be deemed to be Asset Sales:





     (1) a disposition of assets by a Restricted Subsidiary to the Issuer or by the Issuer
or a Restricted Subsidiary to a Restricted Subsidiary; provided that in the case of a sale
by a Restricted Subsidiary to another Restricted Subsidiary, the Issuer directly or
indirectly owns an equal or greater percentage of the Common Stock of the transferee than of
the transferor; provided, that in the case of a disposition of Collateral, the transferee
shall cause such amendments, supplements or other instruments to be executed, filed, and
recorded in such jurisdictions as may be required by applicable law to preserve and protect
the Lien on the Collateral owned by or transferred to the transferee, together with such
financing statements or comparable documents as may be required to perfect any security
interests in such Collateral which may be perfected by the filing of a financing statement
or a similar document under the Uniform Commercial Code, PPSA or other similar statute or
regulation of the relevant states or jurisdictions;



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     (2) the sale of Cash Equivalents or Acceptable Tax Credits in the ordinary course of
business;




     (3) a disposition of inventory, including without limitation, Product (not constituting
the sale of a Product that in the aggregate would be considered a “library”), in the
ordinary course of business;




     (4) a disposition of obsolete or worn out equipment or equipment that is no longer
useful in the conduct of the business of the Issuer and the Restricted Subsidiaries and that
is disposed of in each case in the ordinary course of business;




     (5) the disposition of all or substantially all of the assets of the Issuer in a manner
permitted under Section 5.01 or any disposition that constitutes a Change of Control;




     (6) an issuance of Capital Stock by a Restricted Subsidiary to the Issuer or to a
Wholly Owned Subsidiary;




     (7) for purposes of “Sales of assets” only, any Restricted Payment or Permitted
Investment that is permitted to be made, and is made, under Section 4.07;




     (8) dispositions of assets or issuance or sale of Capital Stock of a Restricted
Subsidiary in a single transaction or series of related transactions with an aggregate Fair
Market Value of less than $5,000,000;




     (9) the creation of a Permitted Lien or other Lien permitted under Section 4.12 and
dispositions in connection with Permitted Liens;




     (10) dispositions of receivables in connection with the compromise, settlement or
collection thereof in the ordinary course of business or in bankruptcy or similar
proceedings and exclusive of factoring or similar arrangements;




     (11) the issuance by a Restricted Subsidiary of Preferred Stock that is permitted under
Section 4.09;




     (12) the licensing or sublicensing of intellectual property or other general
intangibles and licenses, leases or subleases of other property in the ordinary course of
business which do not materially interfere with the business of the Issuer and the
Restricted Subsidiaries;




     (13) foreclosure on assets;




     (14) any sale of Capital Stock in, Indebtedness or other securities of, an Unrestricted
Subsidiary;




     (15) any exchange of assets (including a combination of assets and Cash Equivalents)
for assets related to a Related Business of comparable or greater market value or usefulness
to the business of the Issuer and its Restricted Subsidiaries as a whole, as determined in
good faith by the Issuer, which in the event of an exchange of assets with a fair market
value in excess of (a) $10,000,000 shall be evidenced by an Officers’ Certificate, and (b)
$20,000,000 shall be set forth in a resolution approved in good faith by at least a majority
of the Board of Directors of the Issuer;



-6-









 






     (16) sales of Product outside of the ordinary course of business (including the sale of
Product that in the aggregate would be considered a “library”) if sold for not less than
fair market value and not in excess of $20,000,000 in the aggregate from the Issue Date;




     (17) sales of all or a portion of an interest in a Foreign Subsidiary, provided that
(a) the consideration received is not less than fair market value, and (b) either (x) no
part of the assets of such Foreign Subsidiary comprise a portion of the Borrowing Base as of
such date of sale, or (y) to the extent any of the assets of such Foreign Subsidiary
comprise a portion of the Borrowing Base, that after giving effect to such sale and
assigning a zero value to such asset for purposes of the Borrowing Base calculation, the
Issuer could Incur $1.00 of additional Indebtedness pursuant to Section 4.09(a)(2) after
giving effect, on a pro forma basis, to such sale;




     (18) the sale of Product to SlateCo as part of the Permitted Slate Financing; and




     (19) the sale of revenue participations in Product to SGF as part of the SGF
Co-Financing Arrangement.



          “Attributable Indebtedness” in respect of a Sale/Leaseback Transaction means, as at
the time of determination, the present value (discounted at the interest rate implicit in the
transaction) of the total obligations of the lessee for rental payments during the remaining term
of the lease included in such Sale/Leaseback Transaction (including any period for which such lease
has been extended), determined in accordance with GAAP; provided, however, that if
such Sale/Leaseback Transaction results in a Capitalized Lease Obligation, the amount of
Indebtedness represented thereby will be determined in accordance with the definition of
“Capitalized Lease Obligations.”




          “Average Life” means, as of the date of determination, with respect to any
Indebtedness or Preferred Stock, the quotient obtained by dividing (1) the sum of the products of
the numbers of years from the date of determination to the dates of each successive scheduled
principal payment of such Indebtedness or redemption or similar payment with respect to such
Preferred Stock multiplied by the amount of such payment by (2) the sum of all such payments.




          “Board of Directors” means, as to any Person, the board of directors or managers, as
applicable, of such Person (or, if such Person is a partnership, the board of directors or other
governing body of the general partner of such Person) or any duly authorized committee thereof.




          “Bankruptcy Law” means Title 11, U.S. Code, the Bankruptcy and Insolvency Act
(Canada), the Companies’ Creditors Arrangement Act (Canada) or other U.S. federal or state law,
Canadian federal or provincial law or the law of any other jurisdiction relating to bankruptcy,
insolvency, winding up, liquidation, reorganization or relief of debtors or plans of arrangement.




          “beneficial ownership” has the meaning assigned to such term in Rule 13d-3 and Rule
13d-5 under the Exchange Act, and “beneficial owner” has a corresponding meaning.




          “Borrowing Base” means, at any date for which the amount thereof is to be determined,
an amount equal to the aggregate (of the Issuer and the LGEI Subsidiary Guarantors on a
consolidated basis without double counting) of the following:





     (1) 100% of Eligible Receivables from Acceptable Major Account Debtors, plus




     (2) 90% of Eligible Receivables from Acceptable Domestic Account Debtors, plus




     (3) 85% of Eligible Receivables from Acceptable Foreign Account Debtors, plus



-7-









 






     (4) 75% of Acceptable Tax Credits for which the Issuer or the LGEI Subsidiary
Guarantors have not received the applicable certificate referred to in clause (3) of the
definition of “Acceptable Tax Credit,” and 85% of Acceptable Tax Credits thereafter, plus




     (5) 50% of Other Domestic Receivables, plus




     (6) 50% of Other Foreign Receivables, plus




     (7) 50% of the Eligible Library Amount, plus




     (8) the lesser of fifty percent (50%) of the book value of physical videocassette
inventory held by the Issuer and the LGEI Subsidiary Guarantors or $10,000,000, plus





     (9) in the case of an item of Product which is intended for domestic theatrical
release, the Home Video Credit plus the Pay Television Credit plus the Free Television
Credit; provided, however, that if any such Product has not had a general theatrical release
in the United States within twelve months of its Completion, the Issuer and the LGEI
Subsidiary Guarantors shall no longer be entitled to include the foregoing credits in
respect of such item of Product in the Borrowing Base, plus




     (10) in the case of an item of Product which is intended as a direct to video release,
the Direct To Video Credit; provided, however, that if such Product has not been released in
the domestic home video market within twelve months of its Completion, the Issuer and the
LGEI Subsidiary Guarantors shall no longer be entitled to include the foregoing credits in
respect of such item of Product in the Borrowing Base, plus




     (11) in the case of an item of Product which is intended for foreign exploitation, the
Foreign Rights Credit; provided, however, that if such item of Product has not been released
in a major foreign territory within 12 months of its Completion, the Issuer and the LGEI
Subsidiary Guarantors shall no longer be entitled to include the foregoing credits in
respect of such item of Product in the Borrowing Base, plus




     (12) 100% of Eligible L/C Receivables, plus




     (13) 100% of the amounts held in the Cash Collateral Account(s) (other than cash
collateral provided in connection with the Pennsylvania Regional Financing Arrangement),
plus




     (14) in the case of an item of Product that has been released on at least 600 screens,
50% of the Issuer’s and the LGEI Subsidiary Guarantors’ share of the “P&A” expenditures for
such item of Product; provided, that such amount shall be reduced by the theatrical rentals
for such item of Product; provided, further, that, in any event, such credit shall
expire upon the earlier of (a) the home video “street date” or (b) six months after the
theatrical release date of such item of Product, minus




     (15) to the extent not otherwise deducted in computing the Borrowing Base, the
aggregate amount of all accrued but unpaid residuals owed to any trade guild with respect to
any item of Product, to the extent that the obligation of the Issuer or any LGEI Subsidiary
Guarantors to pay such residuals is secured by a security interest in such item of Product
or rights therein or proceeds thereof, which security interest is not subordinated to the
security interests of the Collateral Agent (but the amount deducted with respect to any such
item of Product shall not exceed the amount included in the Borrowing Base attributable to
such item of Product);



-8-









 






provided, however, that




     (A) the amount included in the Borrowing Base at any time for Other Domestic
Receivables and Other Foreign Receivables (in each case, other than theatrical
receivables) shall not exceed $30,000,000 in the aggregate for all such receivables
or $500,000 for any domestic obligor or $500,000 for any foreign obligor;




     (B) the portion of the Borrowing Base attributable at any time to each item of
Product which has not yet been Completed shall not exceed the Issuer’s and the LGEI
Subsidiary Guarantors’ Investment in such item of Product, or if pursuant to the
provisions of the Senior Credit Facility in effect on the Issue Date (as such Senior
Credit Facility may be amended, restated, or otherwise modified from time to time in
a manner which is not materially adverse when taken as a whole to the Holders in the
good faith judgment of the Issuer as certified to the Trustee in an Officers’
Certificate) a Completion Guaranty is required for such item of Product, such lesser
amount as would be payable to the Administrative Agent under the Senior Credit
Facility by the completion guarantor under such Completion Guaranty in the event
such Product is not timely Completed and delivered to the Issuer and the LGEI
Subsidiary Guarantors (except that if a letter of credit is issued under the Senior
Credit Facility in order to support the Issuer’s or an LGEI Subsidiary Guarantor’s
minimum payment obligation to acquire distribution rights in an item of Product,
amounts attributable to such rights may be included in the Borrowing Base (even
though the item of Product has not yet been Completed) but only if (A) proof of
Completion of the item of Product must be presented in order to draw under the
letter of credit and (B) the portion of the Borrowing Base attributable to such item
of Product does not exceed the amount of such letter of credit for such item of
Product);




     (C) the portion of the Borrowing Base attributable to Acceptable Tax Credits
shall not exceed 10% of the total Borrowing Base;




     (D) no amounts shall be included in the Borrowing Base which are attributable
to an item of Product or right in which the Issuer or the LGEI Subsidiary
Guarantors, as applicable, cannot warrant sufficient title to the underlying rights;




     (E) no amount shall be included in the Borrowing Base unless the Collateral
Agent (for the benefit of itself and the Holders) has a perfected Second-Priority
Lien in such amounts;




     (F) no additional amounts attributable to Acceptable Tax Credits shall be
included in the Borrowing Base after six months before the scheduled maturity date
of the Notes; and




     (G) the portion of the Borrowing Base attributable to any of the Home Video
Credit, Pay Television Credit, Free Television Credit, Direct to Video Credit or
Foreign Rights Credit shall not exceed 90% of the Production Exposure for all such
items of Product to which such credits relate.



          “Budgeted Negative Cost” means, with respect to any item of Product, the amount of the
cash budget (stated in U.S. Dollars) for such item of Product including all costs customarily
included in connection with the acquisition of all underlying literary, musical and other rights
with respect to such item of Product and in connection with the preparation, production and
completion of such item of Product, including costs of materials, equipment, physical properties,
personnel and services utilized in






-9-









 







connection with such item of Product, both “above-the-line” and “below-the-line”, any
Completion Guaranty fee, and all other items customarily included in negative costs, including
finance charges and interest expense, but excluding production fees, overhead charges or other
fees, charges or costs payable to the Issuer or any LGEI Subsidiary Guarantor, except to the extent
such payments to the Issuer or any LGEI Subsidiary Guarantor are reimbursements for production or
development costs advanced by the Issuer or any LGEI Subsidiary Guarantor to a Person that is not
the Issuer or any LGEI Subsidiary Guarantor.




          “Business Day” means each day that is not a Saturday, Sunday or other day on which
banking institutions in New York, New York are authorized or required by law to close.




          “Capital Stock” of any Person means any and all shares, interests, rights to purchase,
warrants, options, participations or other equivalents of or interests in (however designated)
equity of such Person, including any Preferred Stock and limited liability or partnership interests
(whether general or limited), but excluding any Indebtedness convertible into such equity.




          “Capitalized Lease Obligations” means an obligation that is required to be classified
and accounted for as a capitalized lease for financial reporting purposes in accordance with GAAP,
and the amount of Indebtedness represented by such obligation will be the capitalized amount of
such obligation at the time any determination thereof is to be made as determined in accordance
with GAAP, and the Stated Maturity thereof will be the date of the last payment of rent or any
other amount due under such lease prior to the first date such lease may be terminated without
penalty.




          “Cash Collateral Account” has the meaning assigned to it in the Senior Credit Facility
in effect on the Issue Date (as such Senior Credit Facility may be amended, restated, or otherwise
modified from time to time in a manner which is not materially adverse when taken as a whole to the
Holders in the good faith judgment of the Issuer as certified to the Trustee in an Officers’
Certificate).




          “Cash Equivalents” means:





     (1) U.S. dollars, or in the case of any Foreign Subsidiary, such local currencies held
by it from time to time in the ordinary course of business;




     (2) securities issued or directly and fully Guaranteed or insured by the United States
Government or any agency or instrumentality of the United States (provided that the
full faith and credit of the United States is pledged in support thereof), having maturities
of not more than one year from the date of acquisition;




     (3) marketable general obligations issued by any state of the United States of America
or any political subdivision of any such state or any public instrumentality thereof
maturing within one year from the date of acquisition and, at the time of acquisition,
having a credit rating of “A” or better from either S&P or Moody’s or carrying an equivalent
rating by a nationally recognized Rating Agency, if both of the two named Rating Agencies
cease publishing ratings of investments;




     (4) certificates of deposit, time deposits, eurodollar time deposits, overnight bank
deposits or bankers’ acceptances having maturities of not more than one year from the date
of acquisition thereof issued by any commercial bank the long-term debt of which is rated at
the time of acquisition thereof at least “A” or the equivalent thereof by S&P, or “A” or the
equivalent thereof by Moody’s or carrying an equivalent rating by a nationally recognized
Rating Agency, if both of the two named Rating Agencies cease publishing ratings of
investments, and having combined capital and surplus in excess of $500,000,000;



-10-









 






     (5) repurchase obligations with a term of not more than seven days for underlying
securities of the types described in clauses (2), (3) and (4) entered into with any bank
meeting the qualifications specified in clause (4) above;




     (6) commercial paper rated at the time of acquisition thereof at least “A-2” or the
equivalent thereof by S&P or “P-2” or the equivalent thereof by Moody’s, or carrying an
equivalent rating by a nationally recognized Rating Agency, if both of the two named Rating
Agencies cease publishing ratings of investments, and in any case maturing within one year
after the date of acquisition thereof; and




     (7) interests in any investment company or money market fund which invests 95% or more
of its assets in instruments of the type specified in clauses (1) through (6) above.




     “Change of Control” means:




     (1) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Exchange Act), other than, in the case of the Issuer, Parent, becomes the beneficial owner
(as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that such person or
group shall be deemed to have “beneficial ownership” of all shares that any such person or
group has the right to acquire, whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of more than 50% of the total voting power of
the Voting Stock of the Issuer or Parent (or its successor by merger, plan of arrangement,
consolidation or purchase of all or substantially all of its assets) (for the purposes of
this clause, such person or group shall be deemed to beneficially own any Voting Stock of
the Issuer or Parent held by a parent entity, if such person or group “beneficially owns”
(as defined above), directly or indirectly, more than 50% of the voting power of the Voting
Stock of such parent entity); or




     (2) the first day on which Continuing Directors cease to constitute a majority of the
members of the Board of Directors of the Issuer or Parent; or




     (3) the sale, assignment, lease, transfer, conveyance or other disposition (other than
by way of merger, plan of arrangement, or consolidation), in one or a series of related
transactions, of all or substantially all of the assets of Parent, or of the Issuer and the
Restricted Subsidiaries taken as a whole, to any “person” (as such term is used in Sections
13(d) and 14(d) of the Exchange Act); or




     (4) the adoption by the stockholders of the Issuer or Parent of a plan or proposal for
the winding-up, liquidation or dissolution of the Issuer or Parent.



          “Code” means the Internal Revenue Code of 1986, as amended.




          “Collateral” means all property and assets, whether now owned or hereafter acquired,
in which Liens are, from time to time, purported to be granted to secure the Notes and the Notes
Guarantees pursuant to the Collateral Documents.




          “Collateral Agent” means U.S. Bank National Association, acting as the collateral
agent under the Collateral Documents, or any successor thereto.




          “Collateral Documents” means the mortgages, deeds of trust, deeds to secure debt,
security agreements, pledge agreements, agency agreements, Intercreditor Agreements, hypothecs and
other instruments and documents executed and delivered pursuant to this Indenture or any of the
foregoing, as the same may be amended, supplemented or otherwise modified from time to time and






-11-









 







pursuant to which Collateral is pledged, assigned or granted to or on behalf of the Collateral
Agent for the ratable benefit of the holders of the Notes and the Trustee or notice of such pledge,
assignment or grant is given.




          “Collateral Requirement” means the requirement that:





     (1) all documents and instruments, including Uniform Commercial Code and PPSA financing
statements and mortgages, required by law to be filed, registered or recorded to create the
Liens intended to be created by the Collateral Documents on the Collateral and perfect or
record such Liens as valid Liens with priority set forth in the Collateral Documents free of
any other Liens except for Permitted Liens, shall have been filed, registered or recorded;
and




     (2) the Collateral Agent shall have received, with respect to each property required to
be subject to a mortgage, counterparts of a mortgage duly executed and delivered by the
record owner of such mortgaged property, a lender’s title insurance policy insuring the lien
of each mortgage, and an existing survey of the mortgaged property.



          “Common Stock” means with respect to any Person, any and all shares, interests or
other participations in, and other equivalents (however designated and whether voting or nonvoting)
of such Person’s common stock whether or not outstanding on the Issue Date, and includes, without
limitation, all series and classes of such common stock.




          “Complete” or “Completed” or “Completion” means with respect to any
item of Product, that (1) either (a) sufficient elements have been delivered by the Issuer or
applicable Restricted Subsidiary to, and accepted, deemed or determined to be accepted and/or
exploited by, a Person (other than the Issuer or applicable Restricted Subsidiary or Affiliates
thereof) to permit such Person to exhibit the item of Product in the theatrical or other medium for
which the item of Product is intended for initial exploitation or (b) an independent laboratory has
in its possession a complete final 35 mm or 70 mm (or other size which has become standard in the
industry) composite positive print, video master or other equivalent master copy of the item of
Product as finally cut, main and end titled, edited, scored and assembled with sound track printed
thereon in perfect synchronization with the photographic action and fit and ready for exhibition
and distribution in the theatrical or other medium for which the item of Product is intended for
initial exploitation, and (2) if such item of Product was acquired by the Issuer or a Restricted
Subsidiary from an unaffiliated third party, the entire acquisition price or minimum advance shall
have been paid to the extent then due and there is no condition or event (including, without
limitation, the payment of money not yet due) the occurrence of which might result in the Issuer or
such Restricted Subsidiary losing any of its rights in such item of Product.




          “Completion Guaranty” means, with respect to any item of Product, a completion
guaranty, in customary form consistent with the Issuer’s past practice, issued by an Approved
Completion Guarantor, which (1) names the Collateral Agent (for the benefit of the Trustee and the
Holders) or the applicable outside production financier to the extent such item of Product is
financed in accordance with Section 4.09(a) or Section 4.09(b)(12) as a beneficiary thereof to the
extent of the Issuer’s or applicable Restricted Subsidiary’s financial interest in such item of
Product and (2) guarantees that such item of Product will be Completed in a timely manner, or else
payment made to the Collateral Agent (on behalf of the Trustee and the Holders) of an amount at
least equal to the aggregate amount expended on the production of such item of Product by, or for
the account of, the Issuer or applicable Restricted Subsidiary plus interest on, and other bank
charges with respect to, such amount.




          “Consolidated Adjusted Charges” means, with respect to any Person for any period, the
aggregate depreciation, amortization other than direct operating expenses, as calculated on the
Issue Date, and other non-cash expenses (including, without limitation, stock based compensation
expenses including






-12-









 







for stock appreciation rights or write-offs of deferred financing charges) of such Person and
its Restricted Subsidiaries reducing Consolidated Net Income of such Person for such period on a
consolidated basis and otherwise determined in accordance with GAAP, but in each case excluding any
such charge which consists of or requires an accrual of, or cash reserve for, anticipated cash
charges for any future period (other than accruals for stock appreciation rights), plus print and
advertising expenses (irrespective of whether such Person has actually made a cash payment in
respect thereof during such Period) for which such Person has an off-setting right of payment
and/or guarantee from a third-party producer (less the amortization of participation charges that
would had been expensed had the print and advertising expense not been expensed in the GAAP
financial statements, such amortization to be calculated in accordance with accounting based on the
film forecasting method).




          “Consolidated Applicable Interest Charge” means, with respect to any Person for any
period, the sum, without duplication, of:





     (1) consolidated interest expense of such Person and its Restricted Subsidiaries for
such period, to the extent such expense was deducted in computing Consolidated Net Income
(including amortization of original issue discount, the interest component of Capitalized
Lease Obligations, and net payments and receipts (if any) pursuant to interest rate Hedging
Obligations and excluding amortization of deferred financing fees and expensing of any
bridge or other financing fees); plus




     (2) consolidated capitalized interest of such Person and its Restricted Subsidiaries
for such period, whether paid or accrued, other than capitalized interest included in the
cost of any item of Product; minus




     (3) interest income for such period; minus




     (4) interest expense accrued as a result of APB 14-1, to the extent such interest
expense was included in clause (1) of this definition.




     “Consolidated Interest Expense” means, with respect to any Person for any
period, the sum, without duplication, of:




     (1) consolidated interest expense of such Person and its Restricted Subsidiaries for
such period, to the extent such expense was deducted in computing Consolidated Net Income
(including amortization of original issue discount, the interest component of Capitalized
Lease Obligations, and net payments and receipts (if any) pursuant to interest rate Hedging
Obligations and including amortization of deferred financing fees and expensing of any
bridge or other financing fees); plus




     (2) consolidated capitalized interest of such Person and its Restricted Subsidiaries
for such period, whether paid or accrued, other than capitalized interest included in the
cost of any item of Product; minus




     (3) interest income for such period.



          “Consolidated Leverage Ratio” means, as any date of determination, the ratio of (1)
the sum of (a) the Borrowing Base and (b) unrestricted cash and Cash Equivalents of the Issuer and
its Restricted Subsidiaries, in each case, as of such date of determination, to (2) the total
principal amount of Indebtedness (or in the case of Indebtedness issued at less than its principal
amount at maturity, the accreted value thereof) of the Issuer and its Restricted Subsidiaries as of
such determination date on a pro forma basis after giving effect to all incurrences and repayments
of Indebtedness to occur on or






-13-









 







substantially concurrently with the related transaction, determined on a consolidated basis;
provided, however, that such Indebtedness shall not include any Other Permitted Priority
Indebtedness.




          “Consolidated Net Income” means, for any period, the net income (loss) of the Issuer
and its consolidated Restricted Subsidiaries determined on a consolidated basis in accordance with
GAAP; provided, however, that there will not be included in such Consolidated Net Income on an
after-tax basis:





     (1) any net income (loss) of any Person if such Person is not a Restricted Subsidiary
or that is accounted for by the equity method of accounting, except that:




     (A) subject to the limitations contained in clauses (3) through (6) below,
Issuer equity in the net income of any such Person for such period will be included
in such Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Person during such period to the Issuer or a Restricted
Subsidiary as a dividend or other distribution (subject, in the case of a dividend
or other distribution to a Restricted Subsidiary, to the limitations contained in
clause (2) below); and




     (B) the Issuer’s equity in a net loss of any such Person (other than an
Unrestricted Subsidiary) for such period will be included in determining such
Consolidated Net Income to the extent such loss has been funded with cash from the
Issuer or a Restricted Subsidiary after the Issue Date, such inclusion to begin once
the Issuer’s equity in the cumulative net loss of such Person equals the equity
funding in such Person made in cash before the Issue Date by the Issuer or a
Restricted Subsidiary (it being understood that as of June 30, 2009 up to an
aggregate of $45,500,000 of such loss may be deemed funded by cash from the Issuer
or a Restricted Subsidiary invested in such Person prior to the Issue Date);




     (2) any net income (but not loss) of any Restricted Subsidiary (other than a Guarantor)
if such Subsidiary is subject to prior government approval or other restrictions due to the
operation of its charter or any agreement, instrument, judgment, decree, order statute, rule
or government regulation (which have not been waived), directly or indirectly, on the
payment of dividends or the making of distributions by such Restricted Subsidiary, directly
or indirectly, to the Issuer, except that:




     (A) subject to the limitations contained in clauses (3) through (6) below, the
Issuer’s equity in the net income of any such Restricted Subsidiary for such period
will be included in such Consolidated Net Income up to the aggregate amount of cash
that could have been distributed by such Restricted Subsidiary during such period to
Parent, the Issuer or another Restricted Subsidiary as a dividend (subject, in the
case of a dividend to another Restricted Subsidiary, to the limitation contained in
this clause); and




     (B) the Issuer’s equity in a net loss of any such Restricted Subsidiary for
such period will be included in determining such Consolidated Net Income;




     (3) any gain or loss (less all fees and expenses relating thereto) realized upon sales
or other dispositions of any assets of the Issuer or such Restricted Subsidiary, other than
in the ordinary course of business, as determined in good faith by the Board of Directors of
the Issuer;




     (4) any after-tax effect of income (loss) from the early extinguishment of Indebtedness
or Hedging Obligations or other derivative instruments;




     (5) any extraordinary gain or loss; and



-14-









 





          (6) the cumulative effect of a change in accounting principles.




Any cash amounts dividended, distributed, loaned or otherwise transferred to Parent by the Issuer
or its Restricted Subsidiaries pursuant to clause (8) or (9) of Section 4.07(b), without
duplication of any amounts otherwise deducted in calculating Consolidated Net Income, the funds for
which are provided by the Issuer and/or its Restricted Subsidiaries shall be deducted in
calculating the Consolidated Net Income of the Issuer and its Restricted Subsidiaries.




          “Consolidated Taxes” means provision for taxes based on income, profits or capital,
including, without limitation, state, franchise and similar taxes and any Tax Distributions taken
into account in calculating Consolidated Net Income.




          “Consolidated Total Indebtedness” means, as of any date of determination, an amount
equal to the sum of (1) the aggregate amount of all outstanding Indebtedness of the Issuer and its
Restricted Subsidiaries (excluding any undrawn letters of credit issued in the ordinary course of
business) and (2) the aggregate amount of all outstanding Disqualified Stock of the Issuer and its
Restricted Subsidiaries and all Preferred Stock of Restricted Subsidiaries of Issuer, with the
amount of such Disqualified Stock and Preferred Stock equal to the greater of their respective
voluntary or involuntary liquidation preferences, in each case determined on a consolidated basis
in accordance with GAAP.




          “Continuing Directors” means, as of any date of determination, any member of the Board
of Directors of the Issuer or Parent, as the case may be, who: (1) was a member of such Board of
Directors on the Issue Date; or (2) was nominated for election or elected to such Board of
Directors with the approval of a majority of the Continuing Directors who were members of the
relevant Board at the time of such nomination or election.




          “Corporate Trust Office of the Trustee” shall be at the address of the Trustee
specified in Section 14.02 or such other address as to which the Trustee may give notice to the
Holders and the Issuer.




          “Credit Facility” means, with respect to the Issuer or any Guarantor, one or more
secured debt facilities (including, without limitation, the Senior Credit Facility) or commercial
paper facilities with banks or other institutional lenders providing for revolving credit loans,
term loans, receivables financing (including through the sale of receivables to such lenders or to
special purpose entities formed to borrow from such lenders against such receivables) or letters of
credit, in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced
(including by means of sales of debt securities to institutional investors) in whole or in part
from time to time (and whether or not with the original administrative agent and lenders or another
administrative agent or agents or other lenders and whether provided under the original Senior
Credit Facility or any other credit or other agreement or indenture).




          “Currency Agreement” means in respect of a Person any foreign exchange contract,
currency swap agreement, futures contract, option contract or other similar agreement as to which
such Person is a party or a beneficiary.




          “Custodian” means the Trustee, as custodian with respect to the Notes in global form,
or any successor entity thereto.




          “Default” means any event which is, or after notice or passage of time or both would
be, an Event of Default.







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          “Definitive Note” means a certificated Initial Note or Additional Note (bearing the
Restricted Notes Legend if the transfer of such Note is restricted by applicable law) that does not
include the Global Notes Legend.




          “Depositary” means, with respect to the Notes issuable or issued in whole or in part
in global form, the Person specified in Section 2.03 as the Depositary with respect to the Notes,
and any and all successors thereto appointed as Depositary hereunder and having become such
pursuant to the applicable provision of this Indenture.




          “Direct to Video Credit” means with respect to each item of Product that is intended
for direct-to-video release, an amount equal to 40% of the Budgeted Negative Cost therefor, or such
lesser amount as determined in good faith by the Issuer will be received by it from both the video
distribution and television distribution of such item of Product worldwide; provided, however, that
no Direct To Video Credit will be included in the Borrowing Base with respect to any item of
Product prior to its Completion except (i) for items of Product being funded under the Special
Production Tranche and (ii) for items of Product for which a letter of credit is issued under the
Senior Credit Facility in order to support the minimum payment obligation of the Issuer and the
LGEI Subsidiary Guarantors to acquire distribution rights in such item of Product; provided,
further, that such credit shall be reduced dollar-for-dollar by the amount of any advance
or other payment paid, or contractually committed to be paid, to the Issuer or any LGEI Subsidiary
Guarantor with respect to both the video and television distribution of such item of Product;
provided, further, that such credit shall be eliminated with respect to an item of Product
twenty-four (24) months after Completion.




          “Disqualified Stock” means, with respect to any Person, any Capital Stock of such
Person that by its terms (or by the terms of any security into which it is convertible or for which
it is exchangeable) or upon the happening of any event:





     (1) matures or is mandatorily redeemable pursuant to a sinking fund obligation or
otherwise;




     (2) is convertible into or exchangeable for Indebtedness or Disqualified Stock
(excluding Capital Stock which is convertible or exchangeable solely at the option of the
Issuer or a Restricted Subsidiary (it being understood that upon such conversion or exchange
it shall be an Incurrence of such Indebtedness or Disqualified Stock)); or




     (3) is redeemable at the option of the holder of the Capital Stock in whole or in part,


in each case on or prior to the date that is 91 days after the earlier of the date (a) of the
Stated Maturity of the Notes or (b) on which there are no Notes outstanding; provided,
however, that only the portion of Capital Stock which so matures or is mandatorily
redeemable, is so convertible or exchangeable or is so redeemable at the option of the holder
thereof prior to such date will be deemed to be Disqualified Stock; provided,
further, that any Capital Stock that would constitute Disqualified Stock solely because the
holders thereof have the right to require the Issuer or its Subsidiaries to repurchase such Capital
Stock upon the occurrence of a change of control or asset sale (each defined in a substantially
identical manner to the corresponding definitions in this Indenture) shall not constitute
Disqualified Stock if the terms of such Capital Stock (and all such securities into which it is
convertible or for which it is ratable or exchangeable) provide that the Issuer or its
Subsidiaries, as applicable, may not repurchase or redeem any such Capital Stock (and all such
securities into which it is convertible or for which it is ratable or exchangeable) pursuant to
such provision prior to compliance by the Issuer with the provisions of this Indenture described
under Section 4.10 and Section 4.14 and such repurchase or redemption complies with Section 4.07.







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          “Distribution Agreements” means (1) any and all agreements entered into by the Issuer
or a Guarantor pursuant to which such Person has sold, leased, licensed or assigned distribution
rights or other exploitation rights to any item of Product to an un-Affiliated Person and (2) any
and all agreements hereafter entered into by a the Issuer or a Guarantor pursuant to which such
Person sells, leases, licenses or assigns distribution rights or other exploitation rights to any
item of Product to an un-Affiliated Person.




          “Eligible L/C Receivables” has the same definition as an Eligible Receivable except
that (1) an Acceptable L/C (as defined in the Senior Credit Facility) shall have been delivered to
the Administrative Agent under the Senior Credit Facility for the full amount of the receivable and
(2) such receivable need not be with an Acceptable Obligor.




          “Eligible Library Amount” is (1) $531,060,000 as of the Issue Date and (2) thereafter,
the aggregate of the amounts for the various components of the library of the Issuer and the LGEI
Subsidiary Guarantors, determined by an independent consultant selected in good faith and paid for
by the Issuer and (to the extent contemplated by the definition of “Eligible Library Amount” in the
Senior Credit Facility in effect on the Issue Date (as such Senior Credit Facility may be amended,
restated, or otherwise modified from time to time in a manner which is not materially adverse when
taken as a whole to the Holders in the good faith judgment of the Issuer as certified to the
Trustee in an Officers’ Certificate)) approved by the Administrative Agent under the Senior Credit
Facility, using methodology consistent with the Issuer’s past practice without double counting for
items of Product that are receiving other credit in the Borrowing Base on at least an annual basis;
provided, however, that (a) there will be interim reductions to the Eligible Library Amount to
reflect decreases, if any, in the remaining value of unsold library rights resulting from
significant library dispositions during such interim period (e.g., any single agreement or series
of related agreements pertaining to the licensing, distribution or sale of library product
providing for aggregate payments (including reasonably estimated contingent payments) to the Issuer
or the LGEI Subsidiary Guarantors in excess of $20,000,000); and (b) the Eligible Library Amount
may be increased in good faith by the Issuer in the case of a significant library acquisition and
delivery to the Issuer of a supplemental valuation report meeting the above requirements.




          “Eligible Receivables” means, at any date at which the amount thereof is to be
determined, an amount equal to the sum of the present values (discounted on a quarterly basis, in
the case of amounts which are not due and payable within 12 months following the date of
determination, by a rate of interest equal to the interest rate in effect on the date of the
computation with regard to “Alternate Base Rate Loans” as defined under the Senior Credit Facility
in effect on the Issue Date (as such Senior Credit Facility may be amended, restated, or otherwise
modified from time to time in a manner which is not materially adverse when taken as a whole to the
Holders in the good faith judgment of the Issuer as certified to the Trustee in an Officers’
Certificate) or, if no such loans are then outstanding, by the “prime rate” then in effect of the
Trustee) of:





     (1) all net amounts which pursuant to a binding agreement are contractually obligated
to be paid to the Issuer and the LGEI Subsidiary Guarantors either unconditionally or
subject only to normal delivery requirements, and which are reasonably expected by the
Issuer to be payable and collected from Acceptable Obligors minus




     (2) the sum, without double-counting, of (i) the following items (based on the Issuer’s
then-best, good faith estimates): royalties, residuals, commissions, participations and
other payments to third parties, collection/distribution expenses and commissions, home
video fulfillment costs, taxes (including foreign withholding, remittance and similar taxes)
chargeable in respect of such accounts receivable, and any other projected expenses of the
Issuer and the LGEI Subsidiary Guarantors arising in connection with such amounts and (ii)
the outstanding amount of unrecouped advances made by a distributor to the extent subject to
repayment by the



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Issuer or an LGEI Subsidiary Guarantor or adjustment or recoupment, but an Eligible
Receivable shall not include amounts:




     (a) in the aggregate due from a single Acceptable Obligor which are in excess
of the Allowable Amount with respect to such Acceptable Obligor or, in the case of
an Affiliated Group, in the aggregate due from the relevant Acceptable Obligors with
respect to that Affiliated Group, unless in either case such excess is supported by
an Acceptable L/C;




     (b) which in the good faith judgment of the Issuer, are subject to material
conditions precedent to payment (including a material performance obligation or a
material executory aspect on the part of the Issuer or an LGEI Subsidiary Guarantor
or any other party or obligations contingent upon future events not within the
direct control of the Issuer and the LGEI Subsidiary Guarantors); provided, however,
that otherwise Eligible Receivables which are attributable to items of Product
acquired from a third party shall not be excluded pursuant to this clause (b) if the
entire acquisition price or minimum advance shall have been paid to the extent then
due and there is no material condition or event (other than payment of the remaining
purchase price) the occurrence of which would likely result in the Issuer or any
LGEI Subsidiary Guarantor losing its rights in such item of Product;




     (c) which are more than 120 days past due, in the case of receivables (other
than theatrical receivables);




     (d) which are theatrical receivables due from any obligor in connection with
the theatrical exhibition, distribution or exploitation of an item of Product that
are still outstanding six months after their booking;




     (e) to be paid in a currency other than United States dollars, Canadian
dollars, Australian dollars or U.K. pounds sterling to the extent exceeding the U.S.
dollar equivalent of $10,000,000, in the aggregate, as determined by the Issuer in
good faith, except to the extent such excess is hedged by Hedging Obligations from
Persons whose general unsecured obligations have an Investment Grade Rating;




     (f) to the extent included in the Issuer’s and the LGEI Subsidiary Guarantors’
estimated bad debts;




     (g) due from any obligor which has 40% or more of the total receivable amount
from such obligor (x) 120 or more days past due, in the case of all receivables
other than theatrical receivables or (y) six months past the date of booking, for
theatrical receivables (in each case exclusive of amounts that are being disputed or
contested in good faith);




     (h) for which there is bona fide request for a material credit, adjustment,
compromise, offset, counterclaim or dispute; provided, however, that only the amount
in question shall be excluded from such receivable;




     (i) which arise from a multi-picture Distribution Agreement which allows the
obligor on such receivable to exercise a right of offset or recoupment for any
amount payable to or advanced by such obligor under such Distribution Agreement,
against any amount payable with respect to such receivable; provided, however, that
only the



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maximum amount which such obligor may offset or recoup shall be excluded from
Eligible Receivables;




     (j) which are attributable to an item of Product or right in which the Issuer
in good faith cannot warrant sufficient title to the underlying rights to justify
such receivable;




     (k) in which the Collateral Agent (for the benefit of itself and the Holders)
does not have a perfected Second-Priority Lien;




     (l) which are not “Eligible Receivables” pursuant to the Senior Credit Facility
in effect on the Issue Date (as such Senior Credit Facility may be amended,
restated, or otherwise modified from time to time in a manner which is not
materially adverse when taken as a whole to the Holders in the good faith judgment
of the Issuer as certified to the Trustee in an Officers’ Certificate);




     (m) which relate to an item of Product or right as to which the Collateral
Agent has not received a perfected Lien to the extent required by this Indenture
from a laboratory holding physical elements sufficient to fully exploit the rights
held by the Issuer and the Guarantors in such item of Product;




     (n) which may be subject to repayment to the extent not earned by performance
(other than performance consisting of delivery), but only to the extent of the
maximum potential reduction or repayment;




     (o) which are attributable to an item of Product which has not been Completed
unless the Issuer and the Guarantors are in compliance with all Credit Facility
covenants applicable to the production of such item of Product, including without
limitation, delivery of any required Completion Guaranty;




     (p) which are attributable to any item of Product which has not been Completed
and for which a Completion Guaranty is required by any applicable Credit Facility,
to the extent there is not in effect a Completion Guaranty from an Approved
Completion Guarantor or to the extent that such receivable amounts exceed the amount
that would be paid to the Issuer and the LGEI Subsidiary Guarantors under the
related Completion Guaranty if the item of Product were abandoned as of the date of
computation of the Borrowing Base (except that if a letter of credit is issued under
the Senior Credit Facility in order to support the Issuer or LGEI Subsidiary
Guarantor’s minimum payment obligation to acquire distribution rights in an item of
Product, amounts attributable to such rights may be treated as Eligible Receivables
(even though the item of Product has not yet been Completed) but only if (I) proof
of Completion of the item of Product must be presented in order to draw under the
letter of credit, (II) the portion of the Borrowing Base attributable to such
Eligible Receivables for such item of Product does not exceed the amount of such
Letter of Credit for such item of Product, and (III) such amounts otherwise meet all
of the applicable criteria for inclusion as Eligible Receivables); or




     (q) which will not become due and payable until one year or more after the
stated maturity date of the Notes.



          “Equity Offering” means a public offering for cash by the Issuer or Parent, as the
case may be, of its Common Stock, or options, warrants or rights with respect to its Common Stock,
other than






-19-









 







(1) public offerings with respect to the Issuer’s or Parent’s, as the case may be, Common
Stock, or options, warrants or rights, registered on Form S-4 or S-8, (2) an issuance to any
Subsidiary or (3) any offering of Common Stock issued in connection with a transaction that
constitutes a Change of Control.




          “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules
and regulations of the SEC promulgated thereunder.




          “Excluded Assets” means (1) the Fractional Aircraft Interest, (2) interests in the
Headquarters JV, (3) any equity interests owned by any of the Issuer, Parent or any other Guarantor
to the extent that, and for so long as, a pledge of such equity interests would violate applicable
law or an enforceable contractual obligation binding on or relating to such equity interests and
(4) rights of any of the Issuer, Parent or any other Guarantor under any agreement to the extent
that pursuant to the terms of such agreement, the granting of a security interest in such rights
would result in a termination or right of termination of, or is otherwise prohibited under, such
agreement by the other party thereto, but only to the extent such prohibition on assignment is
enforceable; provided, however, that immediately upon the ineffectiveness, lapse or termination of
any such provision, the Collateral shall include, and such Person shall be deemed to have granted a
security interest in, all such rights and interests as if such provision had never been in effect.




          “Excluded Subsidiaries” means, as of the Issue Date, Subsidiaries of the Issuer that
are (1) inactive with no material assets, (2) entities in which the Issuer or any of its
Subsidiaries owns 50% or less of the Voting Stock, or (3) entities in which the Issuer or any of
its Restricted Subsidiaries owns 50% or more of the Voting Stock, but which either (a) qualifies as
an Excluded Asset or (b) for which the Issuer has made an election as of the Issue Date to treat as
an Unrestricted Subsidiary and, in each case, as are set forth in Schedule 2.




          “Existing Convertible Notes” means the 2.9375% Convertible Senior Subordinated Notes
due 2024 and related Guarantees issued under the Indenture dated as of October 4, 2004 among Lions
Gate Entertainment Inc., Lions Gate Entertainment Corp. and J.P. Morgan Trust Company, National
Association; the 3.625% Convertible Senior Subordinated Notes due 2025 and related Guarantees
issued under Indenture dated as of February 24, 2005 among Lions Gate Entertainment Inc., Lions
Gate Entertainment Corp. and J.P. Morgan Trust Company, National Association; and the 3.625%
Convertible Senior Subordinated Notes Due 2025 dated as of April 27, 2009 and related Guarantees
issued under the Indenture dated as of April 27, 2009 among Lions Gate Entertainment Inc., Lions
Gate Entertainment Corp. and The Bank of New York Mellon Trust Company, N.A.




          “Fair Market Value” means, with respect to any asset or liability, the fair market
value of such asset or liability as determined by the Issuer, in good faith; provided that
if the fair market value exceeds $2,500,000, such determination shall be made by the Board of
Directors of the Issuer in good faith (including as to the value of all non-cash consideration).




          “First-Priority Documents” means any agreement or instrument evidencing Indebtedness
that constitutes a First-Priority Obligation, any guarantee of such obligations and any security
document securing such obligations.




          “First-Priority Liens” means Liens on Collateral permitted to be Incurred pursuant to
(a) clauses (1) and (24) of the definition of Permitted Liens and (b) clause (14) of Section 4.12,
but only to the extent such Liens are senior in priority to the Second-Priority Liens.




          “First-Priority Obligations” means all Obligations in respect of Indebtedness
permitted to be incurred under this Indenture which is subject to First-Priority Liens.







-20-









 








          “Foreign Rights Credit” shall mean with respect to each item of Product that is
intended for theatrical release and for which the Issuer or an LGEI Subsidiary Guarantor holds
foreign distribution rights, an amount equal to 15% of the Budgeted Negative Cost for such item of
Product, or such lesser amount as the Issuer reasonably projects will be received by it on a net
present value basis from foreign distribution of such item of Product (computed in good faith in a
manner consistent with past practice); reduced in either case dollar-for-dollar by the amount of
any advance or other payment paid, or committed to be paid (including, without limitation, any
Eligible Receivables) to the Issuer or an LGEI Subsidiary Guarantor with respect to the exhibition
or other exploitation of such item of product in any media outside the United States and Canada;
provided, however, that no Foreign Rights Credit will be included in the Borrowing Base (A) with
respect to any item of Product prior to its Completion except for items of Product (i) funded under
the Special Production Tranche or (ii) for which a letter of credit is issued under the Senior
Credit Facility in order to support the minimum payment obligation of the Issuer and the LGEI
Subsidiary Guarantors to acquire distribution rights in such item of Product or (B) for any item of
Product which was theatrically released in the United States more than 12 months prior to the date
of determination.




          “Foreign Subsidiary” means any Restricted Subsidiary that is not organized under the
laws of the United States of America or any state thereof or the District of Columbia and any
Subsidiary of such Restricted Subsidiary.




          “Fractional Aircraft Interest” shall mean a fractional interest in an executive jet
aircraft and/or a single purpose trust formed solely to hold such interest with an acquisition cost
for such aircraft or such trust which may not exceed $10,000,000.




          “Free Television Credit” shall mean with respect to each item of Product intended for
theatrical release in the United States and for which the Issuer or an LGEI Subsidiary Guarantor
holds free television rights for such territory, an amount equal to (1) until 60 days after
theatrical release of such item of Product, 5% of the Budgeted Negative Cost of such item of
Product reduced by any amounts paid or advanced to the Issuer or an LGEI Subsidiary Guarantor with
respect to such item of Product in such media, and (2) thereafter, 80% of the aggregate Remaining
Ultimates with respect to the free television rights for such item of Product in the United States
and Canada; provided, however, that no Free Television Credit will be included in the Borrowing
Base with respect to any item of Product prior to its Completion except for items of Product (a)
which are funded under the Special Production Tranche or (b) for which a letter of credit is issued
under the Senior Credit Facility in order to support the minimum payment obligation of the Issuer
and the LGEI Subsidiary Guarantors to acquire distribution rights in such item of Product.




          “GAAP” means generally accepted accounting principles in the United States of America
as in effect as of the Issue Date, including those set forth in the opinions and pronouncements of
the Accounting Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant segment of the accounting profession.
All ratios and computations based on GAAP contained in this Indenture will be computed in
conformity with GAAP, except that in the event the Issuer is acquired in a transaction that is
accounted for using purchase accounting, the effects of the application of purchase accounting
shall be disregarded in the calculation of such ratios and other computations contained in this
Indenture.




          “Governmental Authority” means any federal, state, provincial, municipal or other
governmental department, commission, board, bureau, agency or instrumentality, or any court, in
each case whether of the United States, Canada or any other jurisdiction.







-21-









 









     “Government Securities” means securities that are:




     (1) direct obligations of the United States of America for the timely payment of which
its full faith and credit is pledged; or




     (2) obligations of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America the timely payment of which is
unconditionally Guaranteed as a full faith and credit obligation of the United States of
America,


which, in either case, are not callable or redeemable at the option of the issuer thereof, and
shall also include a depositary receipt issued by a bank (as defined in Section 3(a)(2) of the
Securities Act), as custodian with respect to any such Government Securities or a specific payment
of principal of or interest on any such Government Securities held by such custodian for the
account of the holder of such depositary receipt; provided that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable to the holder of
such depositary receipt from any amount received by the custodian in respect of the Government
Securities or the specific payment of principal of or interest on the Government Securities
evidenced by such depositary receipt.




          “Guarantee” means any obligation, contingent or otherwise, of any Person directly or
indirectly guaranteeing any Indebtedness of any other Person and any obligation, direct or
indirect, contingent or otherwise, of such Person:





     (1) to purchase or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness of such other Person (whether arising by virtue of partnership arrangements, or
by agreement to keep-well, to purchase assets, goods, securities or services, to
take-or-pay, or to maintain financial statement conditions or otherwise); or




     (2) entered into for purposes of assuring in any other manner the obligee of such
Indebtedness of the payment thereof or to protect such obligee against loss in respect
thereof (in whole or in part); provided, however, that the term “Guarantee”
will not include endorsements for collection or deposit or for indemnification in the
ordinary course of business.


The term “Guarantee” used as a verb has a corresponding meaning.




          “Guarantor” means each of Parent, each Parent Subsidiary Guarantor and each LGEI
Subsidiary Guarantor.




          “Guarantor Pari Passu Indebtedness” means Indebtedness of a Guarantor that ranks
equally in right of payment to its Notes Guarantee.




          “Guarantor Subordinated Obligation” means, with respect to a Guarantor, any
Indebtedness of such Guarantor (whether outstanding on the Issue Date or thereafter Incurred) that
is expressly subordinated in right of payment to the obligations of such Guarantor under its Notes
Guarantee pursuant to a written agreement.




          “Headquarters JV” shall mean LGJW Colorado Partners LLC, a California limited
liability company whose only members shall be the Issuer, or one of its subsidiaries, Colorado
Creative Studios, LLC, a California limited liability company (the “Developer”), or one of
the Developer’s subsidiaries, and any other members added with the consent of the Issuer and the
Developer, which shall be formed for the sole purpose of constructing, maintaining and owning an
office building to be used as the headquarters of the Issuer and its Subsidiaries.







-22-









 








          “Hedging Obligations” of any Person means the obligations of such Person pursuant to
any Interest Rate Agreement or Currency Agreement.




          “Holder” means a Person in whose name a Note is registered on the Registrar’s books.




          “Home Video Credit” shall mean with respect to each item of Product that is intended
for domestic theatrical release and for which the Issuer or an LGEI Subsidiary Guarantor holds
domestic home video rights, an amount equal to (A) until 60 days after theatrical release of such
item of Product, 25% of the Budgeted Negative Cost of such item of Product reduced by any amounts
paid or advanced to the Issuer or an LGEI Subsidiary Guarantor with respect to such item of Product
in such media, and (B) thereafter, 80% of the aggregate Remaining Ultimates with respect to the
home video rights for such item of Product in the United States and Canada; provided,
however, that no Home Video Credit will be included in the Borrowing Base with respect to any item
of Product prior to its Completion except for items of Product which are (i) funded under the
Special Production Tranche or (ii) for which a letter of credit is issued in order to support the
minimum payment obligation of the Issuer and the LGEI Subsidiary Guarantors to acquire distribution
rights in such item of Product.




          “Incur” means issue, create, assume, Guarantee, incur or otherwise become liable for;
provided, however, that any Indebtedness or Capital Stock of a Person existing at
the time such Person becomes a Restricted Subsidiary (whether by merger, consolidation, acquisition
or otherwise) will be deemed to be Incurred by such Restricted Subsidiary at the time it becomes a
Restricted Subsidiary; and the terms “Incurred” and “Incurrence” have meanings correlative to the
foregoing.




          “Indebtedness” means, with respect to any Person on any date of determination (without
duplication):





     (1) the principal of and premium (if any) in respect of indebtedness of such Person for
borrowed money;




     (2) the principal of and premium (if any) in respect of obligations of such Person
evidenced by bonds, debentures, notes or other similar instruments;




     (3) the principal component of all obligations of such Person in respect of letters of
credit, bankers’ acceptances or other similar instruments (including reimbursement
obligations with respect thereto except to the extent such reimbursement obligation relates
to a trade payable and such obligation is satisfied within 30 days of Incurrence);




     (4) the principal component of all obligations of such Person to pay the deferred and
unpaid purchase price of property, which purchase price is due more than six months after
the date of placing such property in service or taking delivery and title thereto, except
(a) any such balance that constitutes a trade payable or similar obligation to a trade
creditor, in each case accrued in the ordinary course of business and (b) any earn-out
obligation until the amount of such obligation becomes a liability on the balance sheet of
such Person in accordance with GAAP;




     (5) Capitalized Lease Obligations and all Attributable Indebtedness of such Person
(whether or not such items would appear on the balance sheet of the guarantor or obligor);




     (6) the principal component or liquidation preference of all obligations of such Person
with respect to the redemption, repayment or other repurchase of any Disqualified Stock or,
with respect to any Subsidiary of the Issuer that is not a Guarantor, any Preferred Stock;



-23-









 






     (7) the principal component of all Indebtedness of other Persons secured by a Lien on
any asset of such Person, whether or not such Indebtedness is assumed by such Person;
provided, however, that the amount of such Indebtedness will be the lesser
of (a) the fair market value of such asset at such date of determination and (b) the amount
of such Indebtedness of such other Persons;




     (8) the principal component of Indebtedness of other Persons to the extent Guaranteed
by such Person (whether or not such items would appear on the balance sheet of the guarantor
or obligor);




     (9) to the extent not otherwise included in this definition, net obligations of such
Person under Hedging Obligations (the amount of any such obligations to be equal at any time
to the termination value of such agreement or arrangement giving rise to such Hedging
Obligation that would be payable by such Person at such time); and




     (10) to the extent not otherwise included in this definition, the amount of obligations
outstanding under the legal documents entered into as part of a securitization transaction
or series of securitization transactions that would be characterized as principal if such
transaction were structured as a secured lending transaction rather than as a purchase
outstanding relating to a securitization transaction or series of securitization
transactions.


The amount of Indebtedness of any Person at any date will be the outstanding balance at such date
of all unconditional obligations as described above and the maximum liability, upon the occurrence
of the contingency giving rise to the obligation, of any contingent obligations at such date. In
addition, “Indebtedness” of any Person shall include Indebtedness described in the preceding
paragraph that would not appear as a liability on the balance sheet of such Person if:





     (1) such Indebtedness is the obligation of a Joint Venture that is not a Restricted
Subsidiary;




     (2) such Person or a Restricted Subsidiary of such Person is a general partner of the
Joint Venture (a “General Partner”); and




     (3) there is recourse, by contract or operation of law, with respect to the payment of
such Indebtedness to property or assets of such Person or a Restricted Subsidiary of such
Person; and then such Indebtedness shall be included in an amount not to exceed:




     (a) the lesser of (i) the net assets of the General Partner and (ii) the amount
of such obligations to the extent that there is recourse, by contract or operation
of law, to the property or assets of such Person or a Restricted Subsidiary of such
Person; or




     (b) if less than the amount determined pursuant to clause (a) immediately
above, the actual amount of such Indebtedness that is recourse to such Person or a
Restricted Subsidiary of such Person, if the Indebtedness is evidenced by a writing
and is for a determinable amount.



          “Indenture” means this Indenture, as amended or supplemented from time to time.




          “Independent Financial Advisor” means an accounting, appraisal, investment banking
firm or consultant to Persons engaged in Related Businesses of nationally recognized standing that
is, in the good faith judgment of the Issuer, qualified to perform the task for which it has been
engaged.







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          “Initial Notes” has the meaning set forth in the recitals hereto.




          “Initial Purchasers” means J.P. Morgan Securities Inc., Wells Fargo Securities, LLC,
Mitsubishi UFJ Securities (USA), Inc., Thomas Weisel Partners LLC and Piper Jaffray & Co.




          “Initial Unrestricted Subsidiary” means Babe Ruthless Productions, LLC.




          “Intercreditor Agreements” means (1) the Second Lien Intercreditor Agreement to be
entered into among the Issuer, the Guarantors, the Collateral Agent, on behalf of itself and the
holders of the Notes, and the agent under the Senior Credit Facility, on behalf of itself and the
lenders, as the same may be amended, supplemented or otherwise modified from time to time (the
“Second Lien Intercreditor Agreement”), (2) each of the intercreditor or subordination agreements
set forth on Schedule 1 and (3) such other intercreditor or subordination agreements to be entered
into from time to time with respect to Other Permitted Priority Indebtedness.




          “Interest Payment Date” means May 1 and November 1 of each year to stated maturity of
the Notes.




          “Interest Rate Agreement” means, with respect to any Person any interest rate
protection agreement, interest rate future agreement, interest rate option agreement, interest rate
swap agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedge
agreement or other similar agreement or arrangement as to which such Person is party or a
beneficiary.




          “Investment” means, with respect to any Person, all investments by such Person in
other Persons (including Affiliates) in the form of any direct or indirect advance, loan (other
than advances or extensions of credit to customers in the ordinary course of business) or other
extensions of credit (including by way of Guarantee or similar arrangement, but excluding any debt
or extension of credit represented by a bank deposit other than a time deposit or indemnity
provision) or capital contribution to (by means of any transfer of cash or other property to others
or any payment for property or services for the account or use of others), or any purchase or
acquisition of Capital Stock, Indebtedness or other similar instruments issued by, such other
Person and all other items that are or would be classified as investments on a balance sheet
prepared in accordance with GAAP; provided that none of the following will be deemed to be
an Investment:





     (1) Hedging Obligations entered into in the ordinary course of business and in
compliance with this Indenture;




     (2) endorsements of negotiable instruments and documents in the ordinary course of
business; and




     (3) an acquisition of assets, Capital Stock or other securities by the Issuer or a
Subsidiary for consideration to the extent such consideration consists of Common Stock of
the Issuer or of Parent.




     For purposes of Section 4.07,




     (1) “Investment” will include the portion (proportionate to the Issuer’s equity
interest in a Restricted Subsidiary to be designated as an Unrestricted Subsidiary) of the
Fair Market Value of the net assets of such Restricted Subsidiary at the time that such
Restricted Subsidiary is designated an Unrestricted Subsidiary; provided,
however, that upon a redesignation of such Subsidiary as a Restricted Subsidiary,
the Issuer will be deemed to continue to have a permanent “Investment” in an Unrestricted
Subsidiary in an amount (if positive) equal to (a) the Issuer’s



-25-









 






aggregate “Investment” in such Subsidiary as of the time of such redesignation less (b)
the portion (proportionate to the Issuer’s equity interest in such Subsidiary) of the Fair
Market Value of the net assets (as conclusively determined by the Board of Directors of the
Issuer in good faith) of such Subsidiary at the time that such Subsidiary is so
re-designated a Restricted Subsidiary;




     (2) any property transferred to or from an Unrestricted Subsidiary will be valued at
its Fair Market Value at the time of such transfer, in each case as determined in good faith
by the Board of Directors of the Issuer; and




     (3) if the Issuer or any Restricted Subsidiary sells or otherwise disposes of any
Voting Stock of any Restricted Subsidiary such that, after giving effect to any such sale or
disposition, such entity is no longer a Subsidiary of the Issuer, the Issuer shall be deemed
to have made an Investment on the date of any such sale or disposition equal to the Fair
Market Value (as conclusively determined by the Board of Directors of the Issuer in good
faith) of the Capital Stock of such Subsidiary not sold or disposed of.



          “Investment Grade Rating” means a rating equal to or higher than Baa3 (or the
equivalent) by Moody’s and BBB- (or the equivalent) by S&P, or an equivalent rating by any Rating
Agency, in each case, with a stable or better outlook.




          “Issue Date” means October 21, 2009.




          “Issuer” means the party named as such in the first paragraph of this Indenture or any
successor obligor to its obligations under this Indenture and the Notes pursuant to Article 5.




          “Joint Venture” means a joint venture or similar venture with one or more unrelated
parties (whether structured as a corporation, partnership, limited liability company or other
entity) in which the Issuer or any of its Restricted Subsidiaries own Capital Stock and which is
formed and operated to conduct a Related Business.




          “LGEI Subsidiary Guarantor” means each Restricted Subsidiary in existence on the Issue
Date that provides a Notes Guarantee on the Issue Date (and any other Restricted Subsidiary that
provides a Notes Guarantee in accordance with this Indenture after the Issue Date); provided that
upon release or discharge of such Restricted Subsidiary from its Notes Guarantee in accordance with
this Indenture, such Restricted Subsidiary ceases to be an LGEI Subsidiary Guarantor.




          “LGF” means Lions Gate Films Inc. and its successors.




          “LGFF Slate Transaction” means the transactions involving the entity LG Film Finance
I, LLC or any successor thereof (“FilmCo”), pursuant to which, among other things, (1) LGEI
and Pride Pictures LLC (“FundCo”) acquired membership interests in FilmCo pursuant to that
certain Limited Liability Company Agreement for LG Film Finance I, LLC dated as of May 25, 2007,
(2) FilmCo acquired (or will acquire) from LGF ownership of items of Product pursuant to that
certain Master Covered Picture Purchase Agreement dated as of May 25, 2007, and (3) FilmCo, HSBC
(as collateral agent for certain FundCo noteholders) and Administrative Agent entered into that
certain Intercreditor and Subordination Agreement dated as of May 25, 2007.




          “Lien” means, with respect to any asset, any mortgage, lien (statutory or otherwise),
pledge, hypothecation, charge, security interest, preference, priority or encumbrance of any kind
in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable
law, including any conditional sale or other title retention agreement, any lease in the nature
thereof, any option or other agreement to sell or give a security interest in and any filing of or
agreement to give any





-26-











 




financing statement under the Uniform Commercial Code (or equivalent statutes) of any
jurisdiction; provided that in no event shall an operating lease be deemed to constitute a
Lien.




          “Moody’s” means Moody’s Investors Service, Inc. and any successor to its rating agency
business.




          “MQP” means MQP, LLC and its successors.




          “Negative Pick-up Obligation” means, with respect to any item of Product produced by a
third party, a commitment to pay a certain sum of money or other Investment made by the Issuer or
Restricted Subsidiary in order to obtain ownership or distribution rights in such item of Product,
but which does not require any payment unless or until the requirements of clause (1) of the
definition of Completion have been satisfied. Negative Pick-up Obligation includes both
“traditional” negative pickup arrangements and indirect structures.




          “Net Available Cash” from an Asset Sale means cash payments received (including any
cash payments received by way of deferred payment of principal pursuant to a note or installment
receivable or otherwise and net proceeds from the sale or other disposition of any securities or
other assets received as consideration, but only as and when received, but excluding any other
consideration received in the form of assumption by the acquiring Person of Indebtedness or other
obligations relating to the properties or assets that are the subject of such Asset Sale or
received in any other non-cash form) therefrom, in each case net of:





     (1) all legal, accounting, investment banking, title and recording tax expenses,
commissions and other fees and expenses Incurred, and all Federal, state, provincial,
foreign and local taxes required to be paid or accrued as a liability under GAAP (after
taking into account any available tax credits or deductions and any tax sharing agreements),
as a consequence of such Asset Sale;




     (2) all payments made on any Indebtedness that is secured by any assets subject to such
Asset Sale, in accordance with the terms of any Lien upon such assets, or which must by its
terms, or in order to obtain a necessary consent to such Asset Sale, or by applicable law be
repaid out of the proceeds from such Asset Sale;




     (3) all distributions and other payments required to be made to minority interest
holders in Subsidiaries or joint ventures as a result of such Asset Sale; and




     (4) the deduction of appropriate amounts to be provided by the seller as a reserve, in
accordance with GAAP, against any liabilities associated with the assets disposed of in such
Asset Sale and retained by the Issuer or any Restricted Subsidiary after such Asset Sale.



          “Net Cash Proceeds,” with respect to any issuance or sale of Capital Stock, means the
cash proceeds of such issuance or sale net of attorneys’ fees, accountants’ fees, underwriters’ or
placement agents’ fees, listing fees, discounts or commissions and brokerage, consultant and other
fees and charges actually Incurred in connection with such issuance or sale and net of taxes paid
or payable as a result of such issuance or sale (after taking into account any available tax credit
or deductions and any tax sharing arrangements); provided that the cash proceeds of an
Equity Offering by Parent shall not be deemed Net Cash Proceeds, except to the extent such cash
proceeds are contributed to the Issuer.




          “Non-Guarantor Subsidiary” means any Restricted Subsidiary that is not an LGEI
Subsidiary Guarantor.







-27-









 








          “Non-Recourse Debt” means Indebtedness of a Person:





     (1) as to which neither the Issuer nor any Restricted Subsidiary (a) provides any
Guarantee or credit support of any kind (including any undertaking, guarantee, indemnity,
agreement or instrument that would constitute Indebtedness) or (b) is directly or indirectly
liable (as a guarantor or otherwise);




     (2) no default with respect to which (including any rights that the holders thereof may
have to take enforcement action against an Unrestricted Subsidiary) would permit (upon
notice, lapse of time or both) any holder of any other Indebtedness of the Issuer or any
Restricted Subsidiary to declare a default under such other Indebtedness or cause the
payment thereof to be accelerated or payable prior to its Stated Maturity; and




     (3) the explicit terms of which provide there is no recourse against any of the assets
of Parent, the Issuer or the Restricted Subsidiaries.



          “Notes” means the Initial Notes and more particularly means any Note authenticated and
delivered under this Indenture. For all purposes of this Indenture, the term “Notes” shall also
include any Additional Notes that may be issued under a supplemental indenture and Notes to be
issued or authenticated upon transfer, replacement or exchange of Notes.




          “Notes Guarantee” means, individually, any Guarantee of (1) the Issuer’s Obligations
under this Indenture by Parent or any other Guarantor pursuant to the terms of this Indenture and
any supplemental indenture thereto and (2) Parent’s Obligations under its Notes Guarantee by any
Parent Subsidiary Guarantor pursuant to the terms of this Indenture and any supplemental indenture
thereto, and, collectively, the Notes Guarantees.




          “Obligations” means, with respect to any Indebtedness, all obligations (whether in
existence on the Issue Date or arising afterwards, absolute or contingent, direct or indirect) for
or in respect of principal (when due, upon acceleration, upon redemption, upon mandatory repayment
or repurchase pursuant to a mandatory offer to purchase, or otherwise), premium, interest,
penalties, fees, indemnification, reimbursement and other amounts payable and liabilities with
respect to such Indebtedness, including all interest accrued or accruing after the commencement of
any bankruptcy, insolvency or reorganization or similar case or proceeding at the contract rate
(including, without limitation, any contract rate applicable upon default) specified in the
relevant documentation, whether or not the claim for such interest is allowed as a claim in such
case or proceeding.




          “Offering Memorandum” means the offering memorandum, dated October 16, 2009, relating
to the sale of the Initial Notes.




          “Offer to Purchase” means an Asset Sale Offer or a Change of Control Offer.




          “Officer” means the Chairman of the Board, the Chief Executive Officer, the President,
the Chief Financial Officer, any Executive Vice President, Senior Vice President or Vice President,
the Treasurer or the Secretary of the Issuer. Officer of any Guarantor has a correlative meaning.




          “Officers’ Certificate” means a certificate signed by two Officers or by an Officer
and either an Assistant Treasurer or an Assistant Secretary of the Issuer.




          “Opinion of Counsel” means a written opinion from legal counsel who is acceptable to
the Trustee. The counsel may be an employee of or counsel to the Issuer or the Trustee.







-28-









 








          “Other Domestic Receivables” means those receivables or other rights to receive
payments that meet all of the requirements of an “Eligible Receivable” other than that the obligor
is not an Acceptable Obligor; provided that such obligor has both its principal place of business
and jurisdiction of incorporation or formation located within the United States or Canada.




          “Other Foreign Receivables” means those receivables or other rights to receive
payments that meet all of the requirements of an “Eligible Receivable” other than that the obligor
is not an Acceptable Obligor; provided that such obligor has either its principal place of business
or jurisdiction of incorporation or formation located outside the United States or Canada.




          “Other Permitted Priority Indebtedness” means Indebtedness under any of the following:





     (1) Loan and Security Agreement by and between Baster Productions, LLC and Union Bank,
N.A., dated as of March 25, 2009;




     (2) Loan, Participation and Security Agreements between New Mexico State Investment
Council and Burrowers Productions, Inc., dated December 5, 2007;




     (3) Loan, Participation and Security Agreements between New Mexico State Investment
Council and Crash Television Productions, Inc., dated February 28, 2009;




     (4) Accommodation Security Agreement by and between Debmar/Mercury, LLC, on the one
hand, and First California Bank and Citibank, N.A., on the other hand, dated as of March 31,
2009;




     (5) Accommodation Security Agreement by and between Debmar/Mercury, LLC, on the one
hand and Bank Leumi as successor in interest to ICB Entertainment Finance, on the other
hand, dated as of September 29, 2006;




     (6) Accommodation Security Agreement by and between Debmar/Mercury, LLC, on the one
hand and Union Bank, N.A. on the other hand, dated as of September 29, 2009;




     (7) Loan Agreement by and between Pennsylvania Regional Center LP I, Lions Gate
Pennsylvania, Inc., Verdict Productions Inc. and Cupid Productions Inc., dated April 10,
2008, as amended August 28, 2009;




     (8) Loan and Security Agreement by and among SS3 Productions, Inc., Union Bank, N.A.,
as Administrative Agent and Lender, and City National Bank as Lender, dated as of March 25,
2009;




     (9) Loan, Participation and Security Agreements between New Mexico State Investment
Council and Wildfire 2 Productions Inc., dated March 27, 2006;




     (10) Loan, Participation and Security Agreements between New Mexico State Investment
Council and Wildfire 3 Productions Inc., dated September 15, 2006;




     (11) Loan, Participation and Security Agreements between New Mexico State Investment
Council and Wildfire 4 Productions Inc., dated March 16, 2007;




     (12) Credit, Security, Guaranty and Pledge Agreement, dated as of October 6, 2009 among
Lions Gate Mandate Financing Vehicle Inc. and the borrowers referred to therein and the
guarantors referred to therein and the lenders referred to therein and JPMorgan Chase Bank,
N.A. as Administrative Agent and as Issuing Bank and Union Bank, N.A. as Co-Administrative
Agent,



-29-









 







Syndication Agent and Joint Lead Arranger and Wells Fargo Bank, National Association as
Documentation Agent; and




     (13) Indebtedness described under clauses (12), (17) and (19) under Section 4.09(b).



          “Parent” has the meaning set forth in the preamble hereto.




          “Parent Subsidiary Guarantor” means each Subsidiary of Parent (other than the LGEI
Subsidiary Guarantors) in existence on the Issue Date that provides a Notes Guarantee on the Issue
Date (and any other Subsidiary of Parent (other than the LGEI Subsidiary Guarantors) that provides
a Notes Guarantee in accordance with this Indenture after the Issue
Date); provided  that upon
release or discharge of such Subsidiary from its Notes Guarantee in accordance with this Indenture,
such Subsidiary ceases to be a Parent Subsidiary Guarantor.




          “Pari Passu Indebtedness” means Indebtedness that ranks equally in right of payment to
the Notes (without giving effect to Collateral arrangements).




          “Pay Television Credit” shall mean, with respect to each item of Product that is
intended for domestic theatrical release and for which the Issuer or an LGEI Subsidiary Guarantor
holds domestic pay television rights, an amount equal to (1) until 60 days after theatrical release
of such item of Product, 5% of the Budgeted Negative Cost of such item of Product reduced by any
amounts paid or advanced to the Issuer or an LGEI Subsidiary Guarantor with respect to such item of
Product in such media, and (2) thereafter, 80% of the aggregate Remaining Ultimates with respect to
the pay television rights for such item of Product in the United
States and Canada; provided, however, that no Pay Television Credit will be included in the Borrowing Base with respect to any
item of Product prior to its Completion except for items of Product which are (a) funded under the
Special Production Tranche or (b) for which a letter of credit is issued under the Senior Credit
Facility in order to support the minimum payment obligation of the Issuer and the LGEI Subsidiary
Guarantors to acquire distribution rights in such item of Product.




          “Permitted Exceptions” means any Lien permitted to be Incurred pursuant to Section
4.12(1) and, to the extent permitted by operation of law, Liens permitted to be Incurred pursuant
to clauses (2), (3), (19), (21), (23) and (24) of the definition of Permitted Liens.




          “Permitted Investment” means an Investment by the Issuer or any Restricted Subsidiary
in:





     (1) a Restricted Subsidiary;




     (2) any Investment by the Issuer or any of its Restricted Subsidiaries in a Person that
is engaged in a Related Business if as a result of such Investment:




     (A) such Person becomes a Restricted Subsidiary; or




     (B) such Person, in one transaction or a series of related transactions, is
merged or consolidated with or into, or transfers or conveys all or substantially
all of its assets to, or is liquidated into Parent, the Issuer or a Restricted
Subsidiary,




and, in each case, any Investment held by such Person; provided, that such
Investment was not acquired by such Person in contemplation of such acquisition, merger,
consolidation or transfer;




     (3) cash and Cash Equivalents;



-30-









 






     (4) receivables owing to the Issuer or any Restricted Subsidiary created or acquired in
the ordinary course of business and payable or dischargeable in accordance with customary
trade terms; provided, however, that such trade terms may include such
concessionary trade terms as Parent, the Issuer or any such Restricted Subsidiary deems
reasonable under the circumstances;




     (5) payroll, travel, services (e.g., shared services arrangements) to the extent
permitted by Section 4.11(b)(8) and similar advances to cover matters that are expected at
the time of such advances ultimately to be treated as expenses for accounting purposes and
that are made in the ordinary course of business;




     (6) loans or advances to employees, Officers or directors of Parent, the Issuer or any
Restricted Subsidiary in the ordinary course of business consistent with past practices in
an aggregate amount not in excess of $5,000,000 with respect to all loans or advances made
since the Issue Date (without giving effect to the forgiveness of any
such loan); provided, however, that the Issuer and its Subsidiaries shall comply in all material respects with the
applicable provisions of the Sarbanes Oxley Act of 2002 and the rules and regulations
promulgated in connection therewith relating to such loans and advances as if the Issuer had
filed a registration statement with the SEC;




     (7) any Investment acquired by the Issuer or any of its Restricted Subsidiaries:




     (A) in exchange for any other Investment or accounts receivable held by the
Issuer or any such Restricted Subsidiary in connection with or as a result of a
bankruptcy, workout, reorganization or recapitalization of the issuer of such other
Investment or accounts receivable; or




     (B) as a result of a foreclosure by the Issuer or any of its Restricted
Subsidiaries with respect to any secured Investment or other transfer of title with
respect to any secured Investment in default;




     (8) Investments made as a result of the receipt of non-cash consideration from an Asset
Sale that was made pursuant to and in compliance with Section 4.10 or any other disposition
of assets not constituting an Asset Sale;




     (9) Investments in existence on the Issue Date;




     (10) Currency Agreements, Interest Rate Agreements and related Hedging Obligations,
which transactions or obligations are Incurred in compliance with Section 4.09;




     (11) Guarantees and other Investments issued in accordance with Section 4.09 relating
to Negative Pick-up Obligations, minimum guarantees to acquire items of Product or interests
therein or similar activities, in each case in the ordinary course of business;




     (12) Investments made in connection with the funding of contributions under any
non-qualified retirement plan or similar employee compensation plan in an amount not to
exceed the amount of compensation expense recognized by the Issuer and its Restricted
Subsidiaries in connection with such plans;




     (13) as part of the Special Production Tranche;




     (14) with respect to the purchase price and/or construction costs expended by the
Issuer and LGEI Subsidiary Guarantors for Issuer’s headquarters or any other real property
of the



-31-









 







Issuer and LGEI Subsidiary Guarantors, the portion of such purchase prices in excess of
any mortgage related to such purchase price;




     (15) Investment in the Headquarters JV not to exceed $40,000,000 (exclusive of any
permitted guarantee);




     (16) Investments in Joint Ventures which Joint Ventures are in existence on the Issue
Date, in an amount , since the Issue Date, not to exceed the sum of (a) the amounts
contractually required to be Invested in such Joint Ventures in accordance with the terms of
the related agreements as in existence on the Issue Date, such amount not to exceed
$15,000,000 in the aggregate, (b) an additional $55,000,000 that may only be used for
contributions to EPIX and (c) an additional aggregate of $17,500,000 that may be used for
contributions to FEARNet or Tigergate. For the avoidance of doubt, the amount in clauses (b)
and (c) shall be in addition to amounts that the Issuer or its Restricted Subsidiaries are
contractually required to Invest in EPIX, FEARNet or Tigergate, as the case may be, and
amounts contributed to EPIX, FEARNet or Tigergate, as the case may be, as contractually
required shall not diminish such amounts;




     (17) Investments (including debt obligations) received in connection with the
bankruptcy or reorganization of suppliers, customers or other debtors or in settlement of
delinquent obligations arising in the ordinary course of business;




     (18) nominal Investments in Special Purpose Producers;




     (19) Investments in and Guarantees of obligations of the Issuer, any Restricted
Subsidiary (including without limitation SlateCo and Mandate Pictures LLC), or any of their
respective direct or indirect subsidiaries or joint ventures in connection with
co-productions, co-ventures or co-financing arrangements, related to the production,
distribution and/or acquisition of Product, item of Product or interest therein, in each
case in the ordinary course of business consistent with past practice;




     (20) loans made by MQP to Services Companies in connection with any tax credits
pursuant to the SGF Co-Financing Arrangement;




     (21) loans made by the Issuer to NextPoint, Inc. in an amount at any time no greater
than $12,500,000 outstanding at any time;




     (22) any acquisition or production of Product in the ordinary course of business, to
the extent such action would be considered an Investment; and




     (23) other Investments by the Issuer or any of the Restricted Subsidiaries, together
with all other Investments pursuant to this clause (23), in an aggregate amount at the time
of such Investment not to exceed an amount outstanding at any one time (with the fair market
value of such Investment being measured at the time made and without giving effect to
subsequent changes in value) equal to 25% of the Eligible Library Amount at the time of such
Investment;


provided, however, that at the time of and after giving effect to any Permitted Investment
permitted under clause (21), no Default shall have occurred or be continuing or would occur as a
consequence thereof; and provided, further, however, that if a Default has
occurred and is continuing, no Investments under clauses (18), (19), (20) or (22) shall be
Permitted Investments except for such Investments made with respect to an existing Product or item
of Product or made with respect to a Product or item of Product as to which a funding or investment
commitment has been made by or on behalf of the Issuer or any of its Restricted Subsidiaries, in
each case prior to the occurrence of such Default.







-32-









 








          “Permitted Liens” means, with respect to any Person:





     (1) Liens securing Indebtedness and other obligations under the Senior Credit Facility
and related Hedging Obligations and related banking services or cash management obligations
and Liens on assets of Parent or Restricted Subsidiaries securing Guarantees of Indebtedness
and other obligations of the Issuer under the Senior Credit Facility, in each case,
permitted to be Incurred under this Indenture pursuant to (a) Section 4.09(b)(1) or (b) in
the case of up to $60,000,000 of additional Secured Funded Indebtedness not covered by
Section 4.09(b)(1), Section 4.09(a)(1);




     (2) pledges or deposits by such Person under workers’ compensation laws, unemployment
insurance laws or similar legislation, or good faith deposits in connection with bids,
tenders, contracts (other than for the payment of Indebtedness) or leases to which such
Person is a party, or deposits to secure public or statutory obligations of such Person or
deposits of cash or United States government bonds to secure surety or appeal bonds to which
such Person is a party, or deposits as security for contested taxes or import or customs
duties or for the payment of rent, in each case Incurred in the ordinary course of business;




     (3) Liens imposed by law, including carriers’, warehousemen’s, mechanics’,
materialmen’s and repairmen’s Liens, Incurred in the ordinary course of business;




     (4) Liens for taxes, assessments or other governmental charges not yet subject to
penalties for non-payment or that are being contested in good faith by appropriate
proceedings provided appropriate reserves required pursuant to GAAP have been made in
respect thereof;




     (5) Liens in favor of issuers of surety or performance bonds or letters of credit or
bankers’ acceptances or similar obligations issued pursuant to the request of and for the
account of such Person in the ordinary course of its business; provided,
however, that such letters of credit do not constitute Indebtedness;




     (6) encumbrances, ground leases, easements or reservations of, or rights of others for,
licenses, rights of way, sewers, electric lines, telegraph and telephone lines and other
similar purposes, or zoning, building codes or other restrictions (including, without
limitation, minor defects or irregularities in title and similar encumbrances) as to the use
of real properties or Liens incidental to the conduct of the business of such Person or to
the ownership of its properties that do not in the aggregate materially adversely affect the
value of said properties or materially impair their use in the operation of the business of
such Person;




     (7) Liens securing Hedging Obligations so long as the related Indebtedness is, and is
permitted to be under this Indenture, secured by a Lien on the same property securing such
Hedging Obligation;




     (8) leases, licenses, subleases and sublicenses of assets (including, without
limitation, real property and intellectual property rights) that do not materially interfere
with the ordinary conduct of the business of the Issuer or any of the Restricted
Subsidiaries;




     (9) Liens arising out of attachments, judgments (to the extent not resulting in an
Event of Default) or awards as to which an appeal or other appropriate proceedings for
contest or review are timely commenced (and as to which foreclosure and other enforcement
proceedings shall not have been commenced (unless fully bonded or otherwise effectively
stayed)) and as to which appropriate reserves have been established in accordance with GAAP;



-33-









 






     (10) Liens for the purpose of securing the payment of all or a part of the purchase
price of, or Capitalized Lease Obligations, mortgage financings, purchase money obligations
or other payments Incurred to finance assets or property (other than Capital Stock or other
Investments) acquired, constructed, improved or leased in the ordinary course of business;
provided that:




     (a) the aggregate principal amount of Indebtedness secured by such Liens is
otherwise permitted to be Incurred under this Indenture and does not exceed the cost
of the assets or property so acquired, constructed or improved; and




     (b) such Liens are created within 180 days of construction, acquisition or
improvement of such assets or property and do not encumber any other assets or
property of the Issuer or any Restricted Subsidiary other than such assets or
property and assets affixed or appurtenant thereto;




     (11) Liens arising solely by virtue of any statutory or common law provisions relating
to banker’s Liens, rights of set-off or similar rights and remedies as to deposit accounts
or other funds maintained with a depositary institution; provided that:




     (a) such deposit account is not a dedicated cash collateral account and is not
subject to restrictions against access by the Issuer in excess of those set forth by
regulations promulgated by the Federal Reserve Board; and




     (b) such deposit account is not intended by the Issuer or any Restricted
Subsidiary to provide collateral to the depository institution;




     (12) Liens arising from Uniform Commercial Code or PPSA financing statement filings
regarding operating leases entered into by the Issuer and the Restricted Subsidiaries in the
ordinary course of business;




     (13) Liens existing on the Issue Date (other than Liens permitted under clause (1));




     (14) Liens on property or shares of stock of a Person at the time such Person becomes a
Restricted Subsidiary; provided, however, that such Liens are not created,
Incurred or assumed in connection with, or in contemplation of, such other Person becoming a
Restricted Subsidiary; provided, further, however, that any such
Lien may not extend to any other property owned by the Issuer or any Restricted Subsidiary;




     (15) Liens on property at the time the Issuer or a Restricted Subsidiary acquired the
property, including any acquisition by means of a merger, plan of arrangement or
consolidation with or into the Issuer or any Restricted Subsidiary; provided,
however, that such Liens are not created, Incurred or assumed in connection with, or
in contemplation of, such acquisition; provided further, however,
that such Liens may not extend to any other property owned by the Issuer or any Restricted
Subsidiary;




     (16) Liens securing Indebtedness or other obligations of a Restricted Subsidiary owing
to the Issuer or a Wholly-Owned Subsidiary;




     (17) Liens securing the Notes (and any Additional Notes issued pursuant to, and in
accordance with, the terms of this Indenture) and Notes Guarantees or any obligations owing
to the Trustee or the Collateral Agent under this Indenture, the Collateral Documents or the
Intercreditor Agreement;



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     (18) Liens securing Refinancing Indebtedness Incurred to refinance, refund, replace,
amend, extend or modify, as a whole or in part, Indebtedness that was previously so secured
pursuant to clauses (10), (13), (14), (15), (17) and
(18) of this definition, provided that
(a) any such Lien is limited to all or part of the same property or assets (plus
improvements, accessions, proceeds or dividends or distributions in respect thereof) that
secured (or, under the written arrangements under which the original Lien arose, could
secure) the Indebtedness being refinanced or is in respect of property that is the security
for a Permitted Lien hereunder and (b) any such Lien is no less favorable to the holders of
the Notes and is no more favorable to the lienholder with respect to such Lien than the Lien
in respect of the Indebtedness being refinanced;




     (19) any interest or title of a lessor under any Capitalized Lease Obligation or
operating lease;




     (20) Liens in favor of the Issuer or any Restricted Subsidiary;




     (21) Liens to secure payment and performance obligations of the Issuer and LGEI
Subsidiary Guarantors in connection with a revenue participation purchase agreement or
similar arrangement for third-party investments in Product produced, acquired or distributed
by the Issuer and such LGEI Subsidiary Guarantors in the ordinary course of business
consistent with past practice;




     (22) Liens under industrial revenue, municipal or similar bonds;




     (23) Liens to secure Negative Pick-up Obligations and direct or indirect guarantees
(including minimum guarantees) related to the acquisition, production or distribution of
items of Product in the ordinary course of business to the extent such Lien is limited
solely to such item of Product related to such Negative Pick-up Obligation or guarantee;




     (24) Liens to secure Other Permitted Priority Indebtedness to the extent such Lien is
limited solely to such item of Product relating to such Other Permitted Priority
Indebtedness; and




     (25) Liens securing Indebtedness (other than Subordinated Obligations and Guarantor
Subordinated Obligations) in an aggregate principal amount outstanding at any one time not
to exceed $20,000,000.



          “Permitted Slate Financing” means a debt financing transaction which the Issuer and/or
the Restricted Subsidiaries may at their option consummate and which satisfies all of the following
criteria: (1) the borrower or issuer in such transaction (“SlateCo”) will be a new corporation or
limited liability company formed solely for the purpose of the Permitted Slate Financing; (2)
SlateCo will not engage in any business other than producing or acquiring Product to be distributed
directly or indirectly by the Issuer or one or more Restricted Subsidiaries; (3) SlateCo will be a
direct or indirect wholly-owned subsidiary of the Issuer and will become a Guarantor of the Notes,
provided, however, that the obligations of SlateCo as a Guarantor of the Notes and the related
security interests in favor of the Collateral Agent shall be subordinated to the rights, claims and
security interests of the providers of the Permitted Slate Financing and subject to an
Intercreditor Agreement with terms that are no less favorable, taken as a whole, to the Holders
than the applicable Intercreditor Agreement in effect on the Issue Date; (4) the Investment by the
Issuer and/or the Restricted Subsidiaries in SlateCo and the Permitted Slate Financing shall be
limited to the use of up to $150,000,000 face amount of receivables due or to become due from
certain Acceptable Obligors, which may be made in the form of a capital contribution to SlateCo or
the grant of a security interest in such receivables to the lenders to SlateCo or otherwise; and
(5) all indebtedness incurred by SlateCo will be expressly non-recourse to Parent, the Issuer or
any Restricted Subsidiary except (a) for the assignment of SlateCo’s rights under the Distribution
Agreement(s) to be






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entered into with the Issuer or one or more Restricted Subsidiary or (b) unsecured Guarantees
Incurred in accordance with Section 4.09, other than clause (b)(13) thereof.




          “Person” means any individual, corporation, partnership, joint venture, association,
joint stock company, trust, unincorporated organization, limited liability company, unlimited
liability company, government or any agency or political subdivision thereof or any other entity.




          “Pledge & Security Agreement” means the Pledge & Security Agreement dated as of
October 21, 2009, among the Issuer, the Guarantors, the Trustee and the Collateral Agent, as the
same may be amended, supplemented or otherwise modified from time to time.




          “PPSA” means the Personal Property Security Act, R.S.O. 1990 c.P.10 as heretofore and
hereafter amended and in effect in the Province of Ontario, or, where the context requires, the
legislation of the other provinces of Canada relating to security in personal property generally,
including accounts receivable, as adopted by and in effect from time to time in such provinces or
territories in Canada, as applicable.




          “Preferred Stock,” as applied to the Capital Stock of any corporation, means Capital
Stock of any class or classes (however designated) that is preferred as to the payment of dividends
upon liquidation, dissolution or winding up.




          “Product” means any motion picture, live event, film, music or video tape or other
audio-visual work or episode thereof produced for theatrical, non-theatrical or television release
or for release in any other medium, in each case whether recorded on film, videotape, cassette,
cartridge, disc or on or by any other means, method, process or device whether now known or
hereafter developed, with respect to which the Issuer or any of its Restricted Subsidiaries (1) is
the copyright owner or (2) acquires an equity interest or distribution rights or interest therein.
The term “item of Product” shall include, without limitation, the scenario, screenplay or script
upon which such item of Product is based, all of the properties thereof, tangible and intangible,
and whether now in existence or hereafter to be made or produced, whether or not in possession of
the Issuer and the Restricted Subsidiaries, and all rights therein and thereto, of every kind and
character.




          “Production Exposure” for an Uncompleted item of Product means (1) with respect to any
item of Product for which the Issuer or a Restricted Subsidiary has direct production
responsibility, the Budgeted Negative Cost for such item of Product (net of amounts being
cash-flowed as and when needed by a third party unrelated to the Issuer or Restricted Subsidiary
pursuant to customary contractual arrangements consistent with the Issuer’s past practice, and (2)
with respect to all other Product, the acquisition price paid or to be paid by the Issuer or
Restricted Subsidiary for such item of Product or any rights therein, including without limitation,
the amount of any related Program Acquisition Guarantee, Negative Pick-up Obligations or
co-financing obligation.




          “Program Acquisition Guarantees” means any commitment of the Issuer or any Restricted
Subsidiary to a producer or owner of Product in conjunction with the acquisition of Product or
distribution rights in Product by the Issuer or such Restricted Subsidiary to the effect that (1)
the gross revenues to be generated in the future from the exploitation of such Product or the net
revenues to be received by such producer or owner from the exploitation of such Product will equal
or exceed an amount specified in the acquisition agreement related to such Product or (2) otherwise
requires payment by the Issuer or Restricted Subsidiary of a minimum amount specified in the
acquisition agreement related to such Product regardless of actual performance of such Product.




          “Rating Agencies” means each of S&P and Moody’s or if S&P or Moody’s or both shall not
make a rating on the Notes publicly available, a nationally recognized statistical rating agency or






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agencies, as the case may be, selected by the Issuer (as certified by a resolution of the
Board of Directors) which shall be substituted for S&P or Moody’s or both, as the case may be.




          “Receivable” means a right to receive payment arising from a sale or lease of goods or
the performance of services by a Person pursuant to an arrangement with another Person pursuant to
which such other Person is obligated to pay for goods or services under terms that permit the
purchase of such goods and services on credit and shall include, in any event, any items of
property that would be classified as an “account,” “chattel paper,” “payment intangible” or
“instrument” under the Uniform Commercial Code as in effect in the State of New York and any
“supporting obligations” as so defined.




          “Record Date” for the interest payable on any applicable Interest Payment Date means
April 15 or October 15 (whether or not a Business Day) next preceding such Interest Payment Date.




          “Refinancing Indebtedness” means Indebtedness that is Incurred to refund, refinance,
replace, exchange, renew, repay or extend (including pursuant to any defeasance or discharge
mechanism) (collectively, “refinance,” “refinances” and “refinanced” shall each have a correlative
meaning) any Indebtedness existing on the Issue Date or Incurred in compliance with this Indenture
(including Indebtedness of the Issuer that refinances Indebtedness of the Issuer or any Restricted
Subsidiary and Indebtedness of any Restricted Subsidiary that refinances Indebtedness of another
Restricted Subsidiary) including Indebtedness that refinances Refinancing Indebtedness,
provided, however, that:





     (1) (a) if the Stated Maturity of the Indebtedness being refinanced is earlier than the
Stated Maturity of the Notes, the Refinancing Indebtedness has a Stated Maturity no earlier
than the Stated Maturity of the Indebtedness being refinanced or (b) if the Stated Maturity
of the Indebtedness being refinanced is later than the Stated Maturity of the Notes, the
Refinancing Indebtedness has a Stated Maturity at least 91 days later than the Stated
Maturity of the Notes;




     (2) the Refinancing Indebtedness has an Average Life at the time such Refinancing
Indebtedness is Incurred that is equal to or greater than the Average Life of the
Indebtedness being refinanced;




     (3) such Refinancing Indebtedness is Incurred in an aggregate principal amount (or if
issued with original issue discount, an aggregate issue price) that is equal to or less than
the sum of the aggregate principal amount (or if issued with original issue discount, the
aggregate accreted value) then outstanding of the Indebtedness being refinanced (plus,
without duplication, any additional Indebtedness Incurred to pay interest or premiums
required by the instruments governing such existing Indebtedness and fees Incurred in
connection therewith);




     (4) if the Indebtedness being refinanced is subordinated in right of payment to the
Notes or the Notes Guarantee, such Refinancing Indebtedness is subordinated in right of
payment to the Notes or the Notes Guarantee on terms at least as favorable to the Holders as
those contained in the documentation governing the Indebtedness being refinanced; and




     (5) Refinancing Indebtedness shall not include Indebtedness of a Non-Guarantor
Subsidiary that refinances Indebtedness of the Issuer or a Guarantor.



          “Related Business” means (1) the development, production, distribution or acquisition
of intellectual properties including feature films, live event, television, interactive media,
music and video product and/or rights therein or thereto, (2) operation of physical production
facilities, (3) acquisition and operation of television channels and internet distribution
platforms and (4) any business which is related, ancillary or complementary to any of the foregoing
activities.







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          “Remaining Ultimates” shall mean with respect to any theatrical motion picture (on a
Product by Product basis), the first cycle amounts which are projected by the Issuer to become
payable to the Issuer and the Guarantors as determined by the Issuer from time to time in good
faith in accordance with this paragraph. The Remaining Ultimates shall be calculated initially on
the date which is 60 days after the general theatrical release in the United States of any such
item of Product and thereafter, as of the last Business Day of each calendar month, on or before
the last Business Day of the following calendar month. The computation of the Remaining Ultimates
will be (1) computed in a manner consistent with ultimates prepared by the Issuer for accounting
purposes, (2) based, to the extent available, upon any supporting written material delivered to the
Issuer under the relevant Distribution Agreement which will indicate the remaining uncollected
amounts payable to the Issuer, (3) present valued at the rate used by the Issuer for accounting
purposes, (4) after deduction for all distribution fees and other remaining amounts deductible or
which may be offset by a distributor or licensee from its obligation to make payments to the Issuer
and any other remaining cost or expense incurred by the Issuer and the Guarantors for the
distribution or other exploitation of such item of Product, (5) reduced by all Eligible Receivables
and Other Domestic Receivables with respect to such Product, territory and media which are
otherwise included in the Borrowing Base, and (6) shall not include any amounts in which the
Collateral Agent (for the benefit of itself and the Holders) does not have a perfected
Second-Priority Lien under the Uniform Commercial Code or other relevant personal property regime
and applicable copyright law.




          “Replication Advances” means advances incurred pursuant to dvd replication, tape
duplication or film processing transactions which require repayment if certain volume commitments
are not fulfilled, provided that repayment of such advances (1) may not be accelerated or be
required to be paid on demand unless such repayment obligation is completely unsecured, (2) do not
require cash payments of interest and (3) are on terms at least as favorable as the Issuer’s or
Restricted Subsidiary’s current replication deals;
provided that, the granting of a Lien in respect
of the related assets, which is junior in right to the Lien on such assets which secures the Notes,
to secure any such Replication Advances will not be considered to be less favorable to the Issuer.




          “Responsible Officer” means, when used with respect to the Trustee, any officer within
the corporate trust department of the Trustee having direct responsibility for the administration
of this Indenture, or any other officer to whom any corporate trust matter is referred because of
such officer’s knowledge of and familiarity with the particular subject.




          “Restricted Investment” means any Investment other than a Permitted Investment.




          “Restricted Subsidiary” means any Subsidiary of the Issuer other than an Unrestricted
Subsidiary.




          “S&P” means Standard & Poor’s, a division of The McGraw-Hill Companies, Inc., and any
successor to its rating agency business.




          “Sale/Leaseback Transaction” means an arrangement relating to property now owned or
hereafter acquired whereby the Issuer or a Restricted Subsidiary transfers such property to a
Person (other than the Issuer or any of its Restricted Subsidiaries) and the Issuer or a Restricted
Subsidiary leases it from such Person.




          “SEC” means the U.S. Securities and Exchange Commission, from time to time
constituted, created under the Exchange Act, or, if at any time after the execution of this
Indenture such SEC is not existing and performing the duties now assigned to it under the Trust
Indenture Act, then the body performing such duties at such time.







-38-









 








          “Second-Priority Liens” means all Liens on Collateral securing (1) the Obligations of
the Issuer and the Guarantors under the Notes, the Notes Guarantees and this Indenture, and (2) any
other Secured Funded Indebtedness which is secured by a Lien with a priority that is pari passu
with the Liens on Collateral securing the Obligations referred to in clause (1), in each case,
after giving effect to First-Priority Liens and certain Permitted Exceptions.




          “Secured Funded Indebtedness” means Indebtedness of the Issuer and its Restricted
Subsidiaries that is secured by a Lien on any asset of the Issuer or any Restricted Subsidiary
(excluding Liens that are junior in priority to the Liens securing the Notes and the Notes
Guarantees and excluding Permitted Liens other than (a) Permitted Liens described in clause (1) or
(17) of the definition thereof and (b) Permitted Liens with respect to any permitted Refinancing
Indebtedness with respect to Indebtedness secured by Liens described in clause (a)).




          “Secured Leverage Ratio,” as of any date of determination, means the ratio of:





     (1) the Borrowing Base of the Issuer and the LGEI Subsidiary Guarantors as of such
date, to




     (2) the total outstanding Secured Funded Indebtedness as of such date, provided that,
solely for purpose of calculation of the Secured Leverage Ratio, the Secured Funded
Indebtedness outstanding under the Senior Credit Facility shall be deemed to be (a) solely
in the case of determination of the Secured Leverage Ratio for the purpose of clause (B)
under Section 4.07(a), the greater of $150,000,000 and the aggregate amount drawn or
borrowed under the Senior Credit Facility after giving effect on a pro forma basis, to such
Restricted Payment, and (b) otherwise, the total commitment (whether used or not) under the
Senior Credit Facility. For the avoidance of doubt, the amount of the total commitments
under the Senior Credit Facility as of the Issue Date is $340,000,000.



          “Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations of the SEC promulgated thereunder.




          “Senior Credit Facility” means the Second Amended and Restated Credit, Security,
Guaranty and Pledge Agreement, as amended as of the Issue Date thereto, among the Issuer, Lions
Gate UK Limited and Lions Gate Australia Pty Limited, as borrowers, the guarantors referred to
therein, JPMorgan Chase Bank, N.A., as Administrative Agent and Issuing Bank, and Wachovia Bank,
N.A., as syndication agent, and the lenders parties thereto from time to time, as the same may be
amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from
time to time (including increasing the amount loaned thereunder provided that such additional
Indebtedness is Incurred in accordance with Section 4.09; provided that the Senior Credit Facility
shall not (1) include Indebtedness issued, created or Incurred pursuant to a registered offering of
securities under the Securities Act or a private placement of securities (including under Rule 144A
or Regulation S) pursuant to an exemption from the registration requirements of the Securities Act
or (2) relate to Indebtedness that does not consist exclusively of Pari Passu Indebtedness or
Guarantor Pari Passu Indebtedness.




          “Services Company” means a corporation (which may or may not be a subsidiary of the
Issuer) having a permanent establishment in Quebec which provides production services pursuant to a
production services agreement between MQP and such Services Company.




          “SGF” means SGF Entertainment Inc., a subsidiary of the Société Générale Financement
du Québec.







-39-









 








          “SGF Co-Financing Arrangement” means the co-financing arrangement by and among MQP,
Parent and SGF, as embodied in written agreements as in effect at the Issue Date, pursuant to
which, among other things, (1) MQP agreed to sell revenue participation interests in certain motion
pictures and television productions to SGF pursuant to that certain Revenue Participation Purchase
Agreement among MQP, SGF, LGF and Lions Gate Television Inc. (“LGT”) dated as of July 25,
2007, (2) MQP licensed certain motion pictures to LGF pursuant to that certain Master Distribution
Agreement (Film Productions) between MQP and LGF, dated as of July 25, 2007 and (3) MQP agreed to
license certain television productions to LGT pursuant to that certain Master Distribution
Agreement (Television Productions) between MQP and LGF, dated as of July 25, 2007.




          “Significant Subsidiary” means any Restricted Subsidiary that would be a “Significant
Subsidiary” of Parent or the Issuer within the meaning of Rule 1-02 under Regulation S-X
promulgated by the SEC.




          “Special Production Tranche” shall have the meaning assigned to it in the Senior
Credit Facility in effect on the Issue Date (as such Senior Credit Facility may be amended,
restated, or otherwise modified from time to time in a manner which is not materially adverse when
taken as a whole to the Holders in the good faith judgment of the Issuer as certified to the
Trustee in an Officers’ Certificate).




          “Special Purpose Joint Venture” means a special purpose joint venture or similar
venture with one or more unrelated parties (whether structured as a corporation, partnership,
limited liability company or other entity) in which a Guarantor owns Capital Stock, which is in
existence on the Issue Date and was formed and is operated to conduct a Related Business and which
a Guarantor owns the right to acquire Capital Stock sufficient to make such joint venture or
similar venture a Subsidiary.




          “Special Purpose Producer” means a special purpose corporation or limited liability
company formed solely for the purpose of producing a particular theatrical motion picture,
television series or direct to home video Product which, in each case, will be purchased or
distributed by the Issuer or any of its Restricted Subsidiaries.




          “Stated Maturity” means, with respect to any security, the date specified in the
agreement governing or certificate relating to such Indebtedness as the fixed date on which the
final payment of principal of such security is due and payable, including pursuant to any mandatory
redemption provision, but shall not include any contingent obligations to repay, redeem or
repurchase any such principal prior to the date originally scheduled for the payment thereof.




          “Subordinated Obligation” means any Indebtedness of the Issuer (whether outstanding on
the Issue Date or thereafter Incurred) that is subordinated or junior in right of payment to the
Notes pursuant to a written agreement. For the avoidance of doubt, such determination will be made
without reference to the presence or absence of security in respect of any such Indebtedness.




          “Subsidiary” of any Person means (1) any corporation, association or other business
entity (other than a partnership, joint venture, limited liability company, unlimited liability
company or similar entity) of which more than 50% of the total ordinary voting power of shares of
Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the
election of directors, managers or trustees thereof (or Persons performing similar functions) or
(2) any partnership, joint venture, limited liability company, unlimited liability company or
similar entity of which more than 50% of the capital accounts, distribution rights, total equity
and voting interests or general or limited partnership interests, as applicable, is, in the case of
clauses (1) and (2), at the time owned or controlled, directly or indirectly, by (a) such Person,
(b) such Person and one or more Subsidiaries of such Person or (c) one or more Subsidiaries of such
Person. Unless otherwise specified herein, each reference to a Subsidiary will refer to a
Subsidiary of the Issuer.







-40-









 








          “Tax Distributions” means any distributions described in Section 4.07(b)(10)(A).




          “Transfer Restricted Notes” means Definitive Notes and any other Notes that bear or
are required to bear the Restricted Notes Legend.




          “Treasury Rate” means the yield to maturity at the time of computation of United
States Treasury securities with a constant maturity (as compiled and published in the most recent
Federal Reserve Statistical Release H.15 (519) which has become publicly available at least two
Business Days prior to the redemption date (or, if such Statistical Release is no longer published,
any publicly available source or similar market data)) most nearly equal to the period from the
redemption date to November 1, 2013; provided,
however, that if the period from the redemption date
to November 1, 2013 is not equal to the constant maturity of a United States Treasury security for
which a weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation
(calculated to the nearest one-twelfth of a year) from the weekly average yields of United States
Treasury securities for which such yields are given, except that if the period from the redemption
date to November 1, 2013 is less than one year, the weekly average yield on actually traded United
States Treasury securities adjusted to a constant maturity of one year shall be used.




          “Trust Indenture Act” means the Trust Indenture Act of 1939, as amended (15 U.S.C. §§
77aaa-777bbbb).




          “Trustee” means U.S. Bank National Association, as trustee, until a successor replaces
it in accordance with the applicable provisions of this Indenture and thereafter means the
successor serving hereunder.




          “Uncompleted” means not Completed.




          “Unrestricted Subsidiary” means:





     (1) any Subsidiary of the Issuer that at the time of determination shall be designated
an Unrestricted Subsidiary by the Board of Directors of the Issuer in the manner provided
below; and




     (2) any Subsidiary of an Unrestricted Subsidiary.



          The Board of Directors of the Issuer may designate any Subsidiary of the Issuer (including any
newly acquired or newly formed Subsidiary or a Person becoming a Subsidiary through merger or
consolidation or Investment therein) to be an Unrestricted Subsidiary only if:





     (1) such Subsidiary or any of its Subsidiaries does not own any Capital Stock or
Indebtedness of or have any Investment in, or own or hold any Lien on any property of, any
other Subsidiary of the Issuer that is not a Subsidiary of the Subsidiary to be so
designated or otherwise an Unrestricted Subsidiary;




     (2) all the Indebtedness of such Subsidiary and its Subsidiaries shall, at the date of
designation, and will at all times thereafter, consist of Non-Recourse Debt;




     (3) such designation and the Investment of the Issuer in such Subsidiary complies with
Section 4.07;



-41-









 






     (4) such Subsidiary, either alone or in the aggregate with all other Unrestricted
Subsidiaries, does not operate, directly or indirectly, all or substantially all of the
business of the Issuer and its Subsidiaries;




     (5) such Subsidiary is a Person with respect to which neither the Issuer nor any of the
Restricted Subsidiaries has any direct or indirect obligation:




     (a) to subscribe for additional Capital Stock of such Person; or




     (b) to maintain or preserve such Person’s financial condition or to cause such
Person to achieve any specified levels of operating results; and




     (6) on the date such Subsidiary is designated an Unrestricted Subsidiary, such
Subsidiary is not a party to any agreement, contract, arrangement or understanding with the
Issuer or any Restricted Subsidiary with terms substantially less favorable to the Issuer
than those that might have been obtained from Persons who are not Affiliates of the Issuer.



          Any such designation by the Board of Directors of the Issuer shall be evidenced to the Trustee
by filing with the Trustee a resolution of the Board of Directors of the Issuer giving effect to
such designation and an Officers’ Certificate certifying that such designation complies with the
foregoing conditions. If, at any time, any Unrestricted Subsidiary would fail to meet the
foregoing requirements as an Unrestricted Subsidiary, it shall thereafter cease to be an
Unrestricted Subsidiary for purposes of this Indenture and any Indebtedness of such Subsidiary
shall be deemed to be Incurred as of such date.




          The Board of Directors of the Issuer may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary; provided that immediately after giving effect to such designation,
no Default or Event of Default shall have occurred and be continuing or would occur as a
consequence thereof and the Issuer could Incur at least $1.00 of additional Indebtedness pursuant
to Section 4.09(a)(2) on a pro forma basis taking into account such designation.




          For the avoidance of doubt, the Issuer shall be permitted to designate any Subsidiary a
Restricted Subsidiary or Unrestricted Subsidiary, in each case, in accordance with the terms of
this Indenture, notwithstanding the designation of such Subsidiary under the Senior Credit Facility
or any other agreement.




          Notwithstanding the foregoing, as of the Issue Date, the Initial Unrestricted Subsidiary and
each of the Excluded Subsidiaries shall be Unrestricted Subsidiaries.




          “U.S.” means the United States of America.




          “Voting Stock” of a Person means all classes of Capital Stock of such Person then
outstanding and normally entitled to vote in the election of directors, managers or trustees, as
applicable, of such Person.




          “Wholly-Owned Subsidiary” means a Restricted Subsidiary, all of the Capital Stock of
which (other than directors’ qualifying shares) is owned by the Issuer or another Wholly-Owned
Subsidiary.





-42-











 





Section 1.02 Other Definitions.




	 	 	 
	Term	 	Defined in Section
	“Additional Amounts”
	 	4.01(c)
	“Affiliate Transaction”
	 	4.11(a)
	“Agent Members”
	 	2.1(c) of Appendix A
	“Applicable Procedures”
	 	1.1(a) of Appendix A
	“Asset Sale Offer”
	 	4.10(b)
	“Asset Sale Offer Amount”
	 	3.09(b)
	“Asset Sale Offer Period”
	 	3.09(b)
	“Asset Sale Purchase Date”
	 	3.09(b)
	“Authentication Order”
	 	2.02
	“Automatic Exchange Date”
	 	2.3(d) of Appendix A          
	“Automatic Exchange Notice”
	 	2.3(d) of Appendix A
	“Automatic Exchange”
	 	2.3(d) of Appendix A
	“Blockage Notice”
	 	10.03
	“Change of Control Offer”
	 	4.14(a)
	“Change of Control Payment Date”
	 	4.14(a)
	“Change of Control Payment”
	 	4.14(a)
	“Clearstream”
	 	1.1(a) of Appendix A
	“Covenant Defeasance”
	 	8.03
	“Definitive Notes Legend”
	 	2.3(f) of Appendix A
	“Distribution Compliance Period”
	 	1.1(a) of Appendix A
	“DTC”
	 	2.03
	“Euroclear”
	 	1.1(a) of Appendix A
	“Event of Default”
	 	6.01(a)
	“Excess Proceeds”
	 	4.10(b)
	“Expiration Date”
	 	1.05(j)
	“Global Note”
	 	2.1(b) of Appendix A
	“Global Notes Legend”
	 	2.3(f) of Appendix A
	“IAI”
	 	1.1(a) of Appendix A
	“IAI Global Note”
	 	2.1(b) of Appendix A
	“IAI Global Note”
	 	2.1(b) of Appendix A
	“Legal Defeasance”
	 	8.02(a)
	“Non-Payment Default”
	 	10.03(b)
	“Note Register”
	 	2.03
	“OID Notes Legend”
	 	2.3(f) of Appendix A
	“Paying Agent”
	 	2.03
	“QIB”
	 	1.1(a) of Appendix A
	“Registrar”
	 	2.03
	“Regulation S”
	 	1.1(a) of Appendix A
	“Regulation S Global Note”
	 	2.1(b) of Appendix A
	“Regulation S Global Note”
	 	2.1(b) of Appendix A
	“Regulation S Notes”
	 	1.1(a) of Appendix A
	“Regulation S Notes”
	 	2.1(a) of Appendix A
	“Reinstatement Date”
	 	4.20(b)
	“Relevant Taxing Authority”
	 	4.01(c)
	“Restricted Global Note”
	 	2.3(b) of Appendix A
	“Restricted Notes Legend”
	 	2.3(f) of Appendix A






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	Term	 	Defined in Section
	“Restricted Payments”
	 	4.07(a)
	“Rule 144”
	 	1.1(a) of Appendix A
	“Rule 144A”
	 	1.1(a) of Appendix A
	“Rule 144A Global Note”
	 	2.1(b) of Appendix A
	“Rule 144A Global Note”
	 	2.1(b) of Appendix A
	“Rule 144A Notes”
	 	1.1(a) of Appendix A
	“Rule 144A Notes”
	 	2.1(a) of Appendix A          
	“Rule 501”
	 	1.1(a) of Appendix A
	“Rule 904”
	 	1.1(a) of Appendix A
	“Successor Company”
	 	5.01(a)
	“Successor Guarantor”
	 	5.01(c)
	“Suspended Covenants”
	 	4.20(a)
	“Suspension Period”
	 	4.20(b)
	“Unrestricted Global Note”
	 	1.1(a) of Appendix A






Section 1.03 Rules of Construction.





     Unless the context otherwise requires:




     (1) a term defined in Section 1.01 or 1.02 has the meaning assigned to it therein, and
a term used herein that is defined in the Trust Indenture Act, either directly or by
reference therein, shall have the meaning assigned to it therein;




     (2) an accounting term not otherwise defined has the meaning assigned to it in
accordance with GAAP;




     (3) “or” is not exclusive;




     (4) words in the singular include the plural, and words in the plural include the
singular;




     (5) provisions apply to successive events and transactions;




     (6) unless the context otherwise requires, any reference to an “Article,” “Section,”
“clause,” “Schedule or “Exhibit” refers to an Article, Section, clause, Schedule or Exhibit,
as the case may be, of this Indenture;




     (7) the words “herein,” “hereof” and other words of similar import refer to this
Indenture as a whole and not any particular Article, Section, clause or other subdivision;




     (8) “including” means including without limitation;




     (9) references to sections of, or rules under, the Securities Act, the Exchange Act or
the Trust Indenture Act shall be deemed to include substitute, replacement or successor
sections or rules adopted by the SEC from time to time;




     (10) unless otherwise provided, references to agreements and other instruments shall be
deemed to include all amendments and other modifications to such agreements or instruments,
but only to the extent such amendments and other modifications are not prohibited by the
terms of this Indenture; and



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     (11) in the event that a transaction meets the criteria of more than one category of
permitted transactions or listed exceptions, the Issuer may classify such transaction as it,
in its sole discretion, determines.



Section 1.04 Incorporation by Reference of Trust Indenture Act.




          Whenever this Indenture refers to a provision of the Trust Indenture Act, the provision is
incorporated by reference in and made a part of this Indenture.




          The following Trust Indenture Act terms used in this Indenture have the following meanings:





     “indenture securities” means the Notes;




     “indenture security holder” means a Holder of a Note;




     “indenture to be qualified” means this Indenture;




     “indenture trustee” or “institutional trustee” means the Trustee; and




     “obligor” on the Notes and the Notes Guarantees means the Issuer and the
Guarantors, respectively, and any successor obligor upon the Notes and the Notes Guarantees,
respectively.



          All other terms used in this Indenture that are defined by the Trust Indenture Act, defined by
Trust Indenture Act reference to another statute or defined by SEC rule under the Trust Indenture
Act have the meanings so assigned to them.




Section 1.05 Acts of Holders.




          (a) Any request, demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given or taken by Holders may be embodied in and evidenced by one
or more instruments of substantially similar tenor signed by such Holders in person or by an agent
duly appointed in writing. Except as herein otherwise expressly provided, such action shall become
effective when such instrument or instruments or record or both are delivered to the Trustee and,
where it is hereby expressly required, to the Issuer and the Guarantors. Proof of execution of any
such instrument or of a writing appointing any such agent, or the holding by any Person of a Note,
shall be sufficient for any purpose of this Indenture and (subject to Section 7.01) conclusive in
favor of the Trustee, the Issuer and the Guarantors, if made in the manner provided in this Section
1.05.




          (b) The fact and date of the execution by any Person of any such instrument or writing may be
proved (1) by the affidavit of a witness of such execution or by the certificate of any notary
public or other officer authorized by law to take acknowledgments of deeds, certifying that the
individual signing such instrument or writing acknowledged to him the execution thereof or (2) in
any other manner deemed reasonably sufficient by the Trustee. Where such execution is by or on
behalf of any legal entity other than an individual, such certificate or affidavit shall also
constitute proof of the authority of the Person executing the same. The fact and date of the
execution of any such instrument or writing, or the authority of the Person executing the same, may
also be proved in any other manner that the Trustee deems sufficient.




          (c) The ownership of Notes shall be proved by the Note Register.




          (d) Any request, demand, authorization, direction, notice, consent, waiver or other action by
the Holder of any Note shall bind every future Holder of the same Note and the Holder of every





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Note issued upon the registration of transfer thereof or in exchange therefor or in lieu
thereof, in respect of any action taken, suffered or omitted by the Trustee, the Collateral Agent,
the Issuer or the Guarantors in reliance thereon, whether or not notation of such action is made
upon such Note.




          (e) The Issuer may, in the circumstances permitted by the Trust Indenture Act, set a record
date for purposes of determining the identity of Holders entitled to make, give or take any
request, demand, authorization, direction, notice, consent, waiver or other action provided in this
Indenture to be made, or to vote on any action authorized or permitted to be taken by Holders;
provided that the Issuer may not set a record date for, and the provisions of this
paragraph shall not apply with respect to, the giving or making of any notice, declaration, request
or direction referred to in clause (f) below. Unless otherwise specified, if not set by the Issuer
prior to the first solicitation of a Holder made by any Person in respect of any such action, or in
the case of any such vote, prior to such vote, any such record date shall be the later of 20 days
prior to the first solicitation of such consent or vote or the date of the most recent list of
Holders furnished to the Trustee prior to such solicitation or vote. If any record date is set
pursuant to this clause (e), the Holders on such record date, and only such Holders, shall be
entitled to make, give or take such request, demand, authorization, direction, notice, consent,
waiver or other action, whether or not such Holders remain Holders after such record date;
provided that no such action shall be effective hereunder unless made, given or taken on or
prior to the applicable Expiration Date by Holders of the requisite principal amount of Notes, or
each affected Holder, as applicable, on such record date. Promptly after any record date is set
pursuant to this paragraph, the Issuer, at its own expense, shall cause notice of such record date,
the proposed action by Holders and the applicable Expiration Date to be given to the Trustee in
writing and to each Holder in the manner set forth in Section 14.02.




          (f) The Trustee may set any day as a record date for the purpose of determining the Holders
entitled to join in the giving or making of (1) any Notice of Default, (2) any declaration of
acceleration referred to in Section 6.02, (3) any direction referred to in Section 6.05 or (4) any
request to institute proceedings referred to in Section 6.06(b). If any record date is set
pursuant to this paragraph, the Holders on such record date, and no other Holders, shall be
entitled to join in such notice, declaration, request or direction, whether or not such Holders
remain Holders after such record date; provided that no such action shall be effective
hereunder unless made, given or taken on or prior to the applicable Expiration Date by Holders of
the requisite principal amount of Notes or each affected Holder, as applicable, on such record
date. Promptly after any record date is set pursuant to this paragraph, the Trustee, at the
Issuer’s expense, shall cause notice of such record date, the proposed action by Holders and the
applicable Expiration Date to be given to the Issuer and to each Holder in the manner set forth in
Section 14.02.




          (g) Without limiting the foregoing, a Holder entitled to take any action hereunder with regard
to any particular Note may do so with regard to all or any part of the principal amount of such
Note or by one or more duly appointed agents, each of which may do so pursuant to such appointment
with regard to all or any part of such principal amount. Any notice given or action taken by a
Holder or its agents with regard to different parts of such principal amount pursuant to this
paragraph shall have the same effect as if given or taken by separate Holders of each such
different part.




          (h) Without limiting the generality of the foregoing, a Holder, including a Depositary that is
the Holder of a Global Note, may make, give or take, by a proxy or proxies duly appointed in
writing, any request, demand, authorization, direction, notice, consent, waiver or other action
provided in this Indenture to be made, given or taken by Holders, and a Depositary, that is the
Holder of a Global Note may provide its proxy or proxies to the beneficial owners of interests in
any such Global Note through such Depositary’s standing instructions and customary practices.






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          (i) The Issuer may fix a record date for the purpose of determining the Persons who are
beneficial owners of interests in any Global Note held by a Depositary entitled under the
procedures of such Depositary, if any, to make, give or take, by a proxy or proxies duly appointed
in writing, any request, demand, authorization, direction, notice, consent, waiver or other action
provided in this Indenture to be made, given or taken by Holders; provided that if such a
record date is fixed, only the Holders on such record date or their duly appointed proxy or proxies
shall be entitled to make, give or take such request, demand, authorization, direction, notice,
consent, waiver or other action, whether or not such Holders remain Holders after such record date.
No such request, demand, authorization, direction, notice, consent, waiver or other action shall
be effective hereunder unless made, given or taken on or prior to the applicable Expiration Date.




          (j) With respect to any record date set pursuant to this Section 1.05, the party hereto that
sets such record dates may designate any day as the “Expiration Date” and from time to time
may change the Expiration Date to any earlier or later day; provided that no such change
shall be effective unless notice of the proposed new Expiration Date is given to the other party
hereto in writing, and to each Holder of Notes in the manner set forth in Section 14.02, on or
prior to the existing Expiration Date. If an Expiration Date is not designated with respect to any
record date set pursuant to this Section 1.05, the party hereto which set such record date shall be
deemed to have initially designated the 120th day after such record date as the Expiration Date
with respect thereto, subject to its right to change the Expiration Date as provided in this clause
(j).




ARTICLE 2




THE NOTES



Section 2.01 Form and Dating; Terms.




          (a) Provisions relating to the Initial Notes and Additional Notes are set forth in Appendix A
hereto, which is hereby incorporated in and expressly made a part of this Indenture. The (1)
Initial Notes and the Trustee’s certificate of authentication and (2) any Additional Notes and the
Trustee’s certificate of authentication shall each be substantially in the form of Exhibit A
hereto, which is hereby incorporated in and expressly made a part of this Indenture. The Notes may
have notations, legends or endorsements required by law, rules or agreements with national
securities exchanges to which the Issuer or any Guarantor is subject, if any, or usage
(provided that any such notation, legend or endorsement is in a form acceptable to the
Issuer). Each Note shall be dated the date of its authentication. The Notes shall be in
denominations of $2,000 and integral multiples of $1,000 in excess thereof.




          (b) The aggregate principal amount of Notes that may be authenticated and delivered under this
Indenture is unlimited.




          The terms and provisions contained in the Notes shall constitute, and are hereby expressly
made, a part of this Indenture and the Issuer, the Guarantors and the Trustee, by their execution
and delivery of this Indenture, expressly agree to such terms and provisions and to be bound
thereby. However, to the extent any provision of any Note conflicts with the express provisions of
this Indenture, the provisions of this Indenture shall govern and be controlling.




          The Notes shall be subject to repurchase by the Issuer at the option of the Holders pursuant
to an Asset Sale Offer as provided in Section 4.10 or a Change of Control Offer as provided in
Section 4.14. The Notes shall not be redeemable, other than as provided in Article 3.




          Additional Notes ranking pari passu with the Initial Notes may be created and issued from time
to time by the Issuer without notice to or consent of the Holders and shall be consolidated with





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and form a single class with the Initial Notes and shall have the same terms as to status,
redemption or otherwise (other than issue price and first Interest Payment Date) as the Initial
Notes; provided that the Issuer’s ability to issue Additional Notes shall be subject to the
Issuer’s compliance with Section 4.09. Any Additional Notes shall be issued with the benefit of an
indenture supplemental to this Indenture.




Section 2.02 Execution and Authentication.




          (a) At least one Officer shall execute the Notes on behalf of the Issuer by manual or
facsimile signature. If an Officer whose signature is on a Note no longer holds that office at the
time a Note is authenticated, the Note shall nevertheless be valid.




          (b) A Note shall not be entitled to any benefit under this Indenture or be valid or obligatory
for any purpose until authenticated substantially in the form of Exhibit A by the manual signature
of the Trustee. The signature shall be conclusive evidence that the Note has been duly
authenticated and delivered under this Indenture.




          (c) On the Issue Date, the Trustee shall, upon receipt of a written order of the Issuer signed
by an Officer (an “Authentication Order”), authenticate and deliver the Initial Notes. In
addition, at any time, from time to time, the Trustee shall upon an Authentication Order
authenticate and deliver any Additional Notes for an aggregate principal amount specified in such
Authentication Order for such Additional Notes issued hereunder.




          (d) The Trustee may appoint an authenticating agent acceptable to the Issuer to authenticate
Notes. An authenticating agent may authenticate Notes whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes authentication by such agent.
An authenticating agent has the same rights as an Agent to deal with Holders or an Affiliate of
the Issuer.




Section 2.03 Registrar and Paying Agent.




          (a) The Issuer shall maintain an office or agency where Notes may be presented for
registration of transfer or for exchange (“Registrar”) and at least one office or agency
where Notes may be presented for payment (“Paying Agent”). The Registrar shall keep a
register of the Notes (“Note Register”) and of their transfer and exchange. The Issuer may
appoint one or more co-registrars and one or more additional paying agents. The term
“Registrar” includes any co-registrar, and the term “Paying Agent” includes any
additional paying agent. The Issuer may change any Paying Agent or Registrar without prior notice
to any Holder. The Issuer shall notify the Trustee in writing of the name and address of any Agent
not a party to this Indenture. If the Issuer fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Issuer or any of its Subsidiaries
may act as Paying Agent or Registrar.




          (b) The Issuer initially appoints The Depository Trust Company (“DTC”) to act as
Depositary with respect to the Global Notes. The Issuer initially appoints the Trustee to act as
the Paying Agent and Registrar for the Notes and to act as Custodian with respect to the Global
Notes.




Section 2.04 Paying Agent to Hold Money in Trust.




          The Issuer shall, no later than 11:00 a.m. (New York City time) on each due date for the
payment of principal of and premium, if any, and interest on any of the Notes, deposit with a
Paying Agent a sum sufficient to pay such amount, such sum to be held in trust for the Holders
entitled to the same, and (unless such Paying Agent is the Trustee) the Issuer shall promptly
notify the Trustee of its action or failure so to act. The Issuer shall require each Paying Agent
other than the Trustee to agree in writing that the Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all money held





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by the Paying Agent for the payment of principal of and premium, if any, interest on the
Notes, and shall notify the Trustee of any default by the Issuer in making any such payment. While
any such default continues, the Trustee may require a Paying Agent to pay all money held by it to
the Trustee. The Issuer at any time may require a Paying Agent to pay all money held by it to the
Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Issuer or a
Subsidiary) shall have no further liability for the money. If the Issuer or a Subsidiary acts as
Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders
all money held by it as Paying Agent. Upon any bankruptcy or reorganization proceedings relating
to the Issuer, the Trustee shall serve as Paying Agent for the Notes.




Section 2.05 Holder Lists.




          The Trustee shall preserve in as current a form as is reasonably practicable the most recent
list available to it of the names and addresses of all Holders and shall otherwise comply with
Trust Indenture Act Section 312(a). If the Trustee is not the Registrar, the Issuer shall furnish
to the Trustee at least two Business Days before each Interest Payment Date and at such other times
as the Trustee may request in writing, a list in such form and as of such date as the Trustee may
reasonably require of the names and addresses of the Holders, and the Issuer shall otherwise comply
with Trust Indenture Act Section 312(a).




Section 2.06 Transfer and Exchange.




          (a) The Notes shall be issued in registered form and shall be transferable only upon the
surrender of a Note for registration of transfer and in compliance with Appendix A.




          (b) To permit registrations of transfers and exchanges, the Issuer shall execute and the
Trustee shall authenticate Global Notes and Definitive Notes upon receipt of an Authentication
Order in accordance with Section 2.02 or at the Registrar’s request.




          (c) No service charge shall be made to a holder of a beneficial interest in a Global Note or
to a Holder of a Definitive Note for any registration of transfer or exchange (other than pursuant
to Section 2.07), but the Holders shall be required to pay any transfer tax or similar governmental
charge payable in connection therewith (other than any such transfer taxes or similar governmental
charge payable upon exchange or transfer pursuant to Section 2.10, 3.06, 3.09, 4.10, 4.14 and
9.05).




          (d) Neither the Registrar nor the Issuer shall be required to register the transfer of or
exchange any Note selected for redemption in whole or in part, except the unredeemed portion of any
Note being redeemed in part.




          (e) All Global Notes and Definitive Notes issued upon any registration of transfer or exchange
of Global Notes or Definitive Notes shall be the valid obligations of the Issuer, evidencing the
same debt, and entitled to the same benefits under this Indenture, as the Global Notes or
Definitive Notes surrendered upon such registration of transfer or exchange.




          (f) Neither the Issuer or the Registrar shall be required (1) to issue, to register the
transfer of or to exchange any Notes during a period beginning at the opening of business 15 days
before the day of any selection of Notes for redemption under Section 3.02 and ending at the close
of business on the day of selection, (2) to register the transfer of or to exchange any Note so
selected for redemption in whole or in part, except the unredeemed portion of any Note being
redeemed in part or (3) to register the transfer of or to exchange a Note between a Record Date and
the next succeeding Interest Payment Date.






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          (g) Prior to due presentment for the registration of a transfer of any Note, the Trustee, any
Agent and the Issuer may deem and treat the Person in whose name any Note is registered as the
absolute owner of such Note for the purpose of receiving payment of principal of and premium, if
any, and interest on such Notes and for all other purposes, and none of the Trustee, any Agent or
the Issuer shall be affected by notice to the contrary.




          (h) Upon surrender for registration of transfer of any Note at the office or agency of the
Issuer designated pursuant to Section 4.02, the Issuer shall execute, and the Trustee shall
authenticate and mail, in the name of the designated transferee or transferees, one or more
replacement Notes of any authorized denomination or denominations of a like aggregate principal
amount.




          (i) At the option of the Holder, Notes may be exchanged for other Notes of any authorized
denomination or denominations of a like aggregate principal amount upon surrender of the Notes to
be exchanged at such office or agency. Whenever any Global Notes or Definitive Notes are so
surrendered for exchange, the Issuer shall execute, and the Trustee shall authenticate and mail,
the replacement Global Notes and Definitive Notes which the Holder making the exchange is entitled
to in accordance with the provisions of Section 2.02.




          (j) All certifications, certificates and Opinions of Counsel required to be submitted to the
Registrar pursuant to this Section 2.06 to effect a registration of transfer or exchange may be
submitted by mail or by facsimile or electronic transmission.




Section 2.07 Replacement Notes.




          If a mutilated Note is surrendered to the Trustee or if a Holder claims that its Note has been
lost, destroyed or wrongfully taken and the Trustee receives evidence to its satisfaction of the
ownership and loss, destruction or theft of such Note, the Issuer shall issue and the Trustee, upon
receipt of an Authentication Order, shall authenticate a replacement Note if the Trustee’s
requirements are met. If required by the Trustee or the Issuer, an indemnity bond must be provided
by the Holder that is sufficient in the judgment of the Trustee and the Issuer to protect the
Issuer, the Trustee, any Agent and any authenticating agent from any loss that any of them may
suffer if a Note is replaced. The Issuer may charge the Holder for the expenses of the Issuer and
the Trustee in replacing a Note. Every replacement Note is a contractual obligation of the Issuer
and shall be entitled to all of the benefits of this Indenture equally and proportionately with all
other Notes duly issued hereunder.




Section 2.08 Outstanding Notes.




          (a) The Notes outstanding at any time are all the Notes authenticated by the Trustee except
for those canceled by it, those delivered to it for cancellation, those reductions in the interest
in a Global Note effected by the Trustee in accordance with the provisions hereof, and those
described in this Section 2.08 as not outstanding. Except as set forth in Section 2.09, a Note
does not cease to be outstanding because the Issuer or an Affiliate of the Issuer holds the Note;
provided that Notes held by the Issuer or a Subsidiary of Parent or of the Issuer will not
be deemed to be outstanding for purposes of Section 3.07(b).




          (b) If a Note is replaced pursuant to Section 2.07, it ceases to be outstanding unless the
Trustee receives proof satisfactory to it that the replaced Note is held by a protected purchaser,
as such term is defined in Section 8-303 of the Uniform Commercial Code in effect in the State of
New York.




          (c) If the principal amount of any Note is considered paid under Section 4.01, from and after
such date it ceases to be outstanding and interest on it ceases to accrue.






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          (d) If the Paying Agent (other than the Issuer, a Subsidiary or an Affiliate of any thereof)
holds, on the maturity date, any redemption date or any date of purchase pursuant to an Offer to
Purchase, money sufficient to pay Notes payable or to be redeemed or purchased on that date, then
on and after that date such Notes shall be deemed to be no longer outstanding and shall cease to
accrue interest.




Section 2.09 Treasury Notes.




          In determining whether the Holders of the requisite principal amount of Notes have concurred
in any direction, waiver or consent, Notes owned by the Issuer, or by any Affiliate of the Issuer,
shall be considered as though not outstanding, except that for the purposes of determining whether
the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes that
a Responsible Officer of the Trustee knows are so owned shall be so disregarded. Notes so owned
which have been pledged in good faith shall not be disregarded if the pledgee establishes to the
satisfaction of the Trustee the pledgee’s right to deliver any such direction, waiver or consent
with respect to the Notes and that the pledgee is not the Issuer or any obligor upon the Notes or
any Affiliate of the Issuer or of such other obligor.




Section 2.10 Temporary Notes.




          Until definitive Notes are ready for delivery, the Issuer may prepare and the Trustee, upon
receipt of an Authentication Order, shall authenticate temporary Notes. Temporary Notes shall be
substantially in the form of definitive Notes but may have variations that the Issuer considers
appropriate for temporary Notes and as shall be reasonably acceptable to the Trustee. Without
unreasonable delay, the Issuer shall prepare and the Trustee shall authenticate definitive Notes in
exchange for temporary Notes. Holders and beneficial holders, as the case may be, of temporary
Notes shall be entitled to all of the benefits accorded to Holders, or beneficial holders,
respectively, of Notes under this Indenture.




Section 2.11 Cancellation.




          The Issuer at any time may deliver Notes to the Trustee for cancellation. The Registrar and
Paying Agent shall forward to the Trustee any Notes surrendered to them for registration of
transfer, exchange or payment. The Trustee or, at the direction of the Trustee, the Registrar or
the Paying Agent and no one else shall cancel all Notes surrendered for registration of transfer,
exchange, payment, replacement or cancellation and shall destroy cancelled Notes in accordance with
its customary procedures (subject to the record retention requirement of the Exchange Act).
Certification of the destruction of all cancelled Notes shall, upon the written request of the
Issuer, be delivered to the Issuer. The Issuer may not issue new Notes to replace Notes that it
has paid or that have been delivered to the Trustee for cancellation.




Section 2.12 Defaulted Interest.




          (a) If the Issuer defaults in a payment of interest on the Notes, it shall pay the defaulted
interest in any lawful manner plus, to the extent lawful, interest payable on the defaulted
interest, to the Persons who are Holders on a subsequent special record date, in each case at the
rate provided in the Notes and in Section 4.01. The Issuer shall notify the Trustee in writing of
the amount of defaulted interest proposed to be paid on each Note and the date of the proposed
payment, and at the same time the Issuer shall deposit with the Trustee an amount of money equal to
the aggregate amount proposed to be paid in respect of such defaulted interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed
payment, such money when deposited to be held in trust for the benefit of the Persons entitled to
such defaulted interest as provided in this Section 2.12. The Trustee shall fix or cause to be
fixed each such special record date and payment date; provided that no such special record
date shall be less than 10 days prior to the related payment date for such defaulted





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interest. The Trustee shall promptly notify the Issuer of such special record date. At least
10 days before the special record date, the Issuer (or, upon the written request of the Issuer, the
Trustee in the name and at the expense of the Issuer) shall mail, or cause to be mailed to each
Holder a notice that states the special record date, the related payment date and the amount of
such interest to be paid.




          (b) Subject to the foregoing provisions of this Section 2.12 and for greater certainty, each
Note delivered under this Indenture upon registration of transfer of or in exchange for or in lieu
of any other Note shall carry the rights to interest accrued and unpaid, and to accrue interest,
which were carried by such other Note.




Section 2.13 CUSIP and ISIN Numbers




          The Issuer in issuing the Notes may use CUSIP and/or ISIN numbers (if then generally in use)
and, if so, the Trustee shall use CUSIP and/or ISIN numbers in notices of redemption or exchange or
in Offers to Purchase as a convenience to Holders; provided that any such notice may state
that no representation is made as to the correctness of such numbers either as printed on the Notes
or as contained in any notice of redemption or exchange or in Offers to Purchase and that reliance
may be placed only on the other identification numbers printed on the Notes, and any such
redemption or exchange of Offer to Purchase shall not be affected by any defect in or omission of
such numbers. The Issuer shall as promptly as practicable notify the Trustee in writing of any
change in the CUSIP or ISIN numbers.




ARTICLE 3




REDEMPTION



Section 3.01 Notices to Trustee.




          If the Issuer elects to redeem Notes pursuant to Section 3.07, it shall furnish to the
Trustee, at least five Business Days before notice of redemption is required to be mailed or caused
to be mailed to Holders pursuant to Section 3.03 but not more than 60 days before a redemption
date, an Officers’ Certificate setting forth (1) the paragraph or subparagraph of such Note and/or
Section of this Indenture pursuant to which the redemption shall occur, (2) the redemption date,
(3) the principal amount of the Notes to be redeemed and (4) the redemption price.




Section 3.02 Selection of Notes to Be Redeemed or Purchased.




          (a) If less than all of the Notes are to be so redeemed pursuant to Section 3.07 or purchased
in an Offer to Purchase at any time, the Trustee shall select the Notes to be redeemed or purchased
(1) if the Notes are listed on any national securities exchange, in compliance with the
requirements of the principal national securities exchange on which the Notes are listed or (2) if
the Notes are not so listed, on a pro rata basis, by lot or by such other method as the Trustee
shall deem fair and appropriate, and in accordance with the procedures of the Depositary in the
case of Global Notes. In the event of partial redemption or purchase by lot, the particular Notes
to be redeemed or purchased shall be selected, unless otherwise provided herein, not less than 30
nor more than 60 days prior to the redemption date by the Trustee from the then outstanding Notes
not previously called for redemption or purchase.




          (b) The Trustee shall promptly notify the Issuer in writing of the Notes selected for
redemption or purchase and, in the case of any Note selected for partial redemption or purchase,
the principal amount thereof to be redeemed or purchased. Notes and portions of Notes selected
shall be in amounts of $1,000 or whole multiples of $1,000 in excess thereof; no Notes of $2,000 or
less shall be redeemed in part, except that if all of the Notes of a Holder are to be redeemed or
purchased, the entire outstanding amount of Notes held by such Holder, even if not $2,000 or a
multiple of $1,000 in excess





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thereof, shall be redeemed or purchased. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption or purchase also apply to
portions of Notes called for redemption or purchase.




          (c) After the redemption date, upon surrender of a Note to be redeemed in part only, a new
Note or Notes in principal amount equal to the unredeemed portion of the original Note representing
the same Indebtedness to the extent not redeemed shall be issued in the name of the Holder of the
Notes upon cancellation of the original Note (or appropriate book entries shall be made to reflect
such partial redemption).




Section 3.03 Notice of Redemption.




          (a) Subject to Section 3.09, the Issuer shall mail, or cause to be mailed notices of
redemption of Notes at least 30 days but not more than 60 days before the redemption date to each
Holder whose Notes are to be redeemed pursuant to this Article at such Holder’s registered address
or otherwise in accordance with the procedures of the Depositary, except that redemption notices
may be mailed more than 60 days prior to a redemption date if the notice is issued in connection
with Article 8 or Article 13. Except as set forth in Section 3.07(b) and (f), notices of
redemption may not be conditional.




          (b) The notice shall identify the Notes to be redeemed and shall state:





     (1) the redemption date;




     (2) the redemption price, including the portion thereof representing any accrued and
unpaid interest;




     (3) if any Note is to be redeemed in part only, the portion of the principal amount of
that Note that is to be redeemed;




     (4) the name and address of the Paying Agent;




     (5) that Notes called for redemption must be surrendered to the Paying Agent to collect
the redemption price;




     (6) that, unless the Issuer defaults in making such redemption payment or the Paying
Agent is prohibited from making such payment pursuant to the terms of this Indenture,
interest on Notes called for redemption ceases to accrue on and after the redemption date;




     (7) the paragraph or subparagraph of the Notes and/or Section of this Indenture
pursuant to which the Notes called for redemption are being redeemed;




     (8) that no representation is made as to the correctness or accuracy of the CUSIP or
ISIN number, if any, listed in such notice or printed on the Notes; and




     (9) if in connection with a redemption pursuant to Section 3.07(b) or (f) if
applicable, any condition to such redemption.



          (c) At the Issuer’s request, the Trustee shall give the notice of redemption in the Issuer’s
name and at the Issuer’s expense; provided that the Issuer shall have delivered to the
Trustee, at least five Business Days before notice of redemption is required to be sent or caused
to be sent to Holders pursuant to this Section 3.03 (unless a shorter notice shall be agreed to by
the Trustee), an Officers’ Certificate requesting that the Trustee give such notice and setting
forth the information to be stated in such notice as provided in the preceding paragraph.






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Section 3.04 Effect of Notice of Redemption.




          Once notice of redemption is mailed in accordance with Section 3.03, Notes called for
redemption become irrevocably due and payable on the redemption date at the redemption price
(except as provided for in Section 3.07(b) or (f)). The notice, if mailed in a manner herein
provided, shall be conclusively presumed to have been given, whether or not the Holder receives
such notice. In any case, failure to give such notice or any defect in the notice to the Holder of
any Note designated for redemption in whole or in part shall not affect the validity of the
proceedings for the redemption of any other Note. Subject to Section 3.05, on and after the
redemption date, interest ceases to accrue on Notes or portions of Notes called for redemption.




Section 3.05 Deposit of Redemption or Purchase Price.




          (a) Prior to 11:00 a.m. (New York City time) on the redemption or purchase date, the Issuer
shall deposit with the Trustee or with the Paying Agent money sufficient to pay the redemption or
purchase price of and accrued and unpaid interest on all Notes to be redeemed or purchased on that
date. The Paying Agent shall promptly mail to each Holder (and, in the case of an Asset Sale
Offer, if applicable, to holders of Pari Passu Indebtedness) to be redeemed or repurchased the
applicable redemption or purchase price thereof and accrued and unpaid interest thereon. The
Trustee or the Paying Agent shall promptly return to the Issuer any money deposited with the
Trustee or the Paying Agent by the Issuer in excess of the amounts necessary to pay the redemption
or purchase price of, and accrued and unpaid interest on, all Notes to be redeemed or purchased.




          (b) If the Issuer complies with the provisions of Section 3.05(a), on and after the redemption
or purchase date, interest shall cease to accrue on the Notes or the portions of Notes called for
redemption or purchase. If a Note is redeemed or purchased on or after a Record Date but on or
prior to the related Interest Payment Date, then any accrued and unpaid interest, if any, to the
redemption or purchase date shall be paid on the relevant Interest Payment Date to the Person in
whose name such Note was registered at the close of business on such Record Date. If any Note
called for redemption or purchase shall not be so paid upon surrender for redemption or purchase
because of the failure of the Issuer to comply with Section 3.05(a), interest shall be paid on the
unpaid principal, from the redemption or purchase date until such principal is paid, and to the
extent lawful on any interest accrued to the redemption or purchase date not paid on such unpaid
principal, in each case at the rate provided in the Notes and in Section 4.01.




Section 3.06 Notes Redeemed or Purchased in Part.




          Upon surrender of a Note that is redeemed or purchased in part, the Issuer shall issue and,
upon receipt of an Authentication Order, the Trustee shall promptly authenticate and mail to the
Holder (or cause to be transferred by book entry) at the expense of the Issuer a new Note equal in
principal amount to the unredeemed or unpurchased portion of the Note surrendered representing the
same Indebtedness to the extent not redeemed or purchased; provided that each new Note
shall be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. It
is understood that, notwithstanding anything in this Indenture to the contrary, only an
Authentication Order and not an Opinion of Counsel or Officers’ Certificate is required for the
Trustee to authenticate such new Note.




Section 3.07 Optional Redemption.




          (a) At any time prior to November 1, 2013, the Issuer may redeem the Notes, in whole but not
in part, upon not less than 30 nor more than 60 days’ prior notice mailed to each Holder or
otherwise in accordance with the procedures of the Depositary, at a redemption price equal to 100%
of the principal amount of the Notes plus the Applicable Premium as of, and accrued and unpaid
interest to the





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date of redemption, subject to the rights of Holders on the relevant Record Date to
receive interest due on the relevant Interest Payment Date.




          (b) Prior to November 1, 2012, the Issuer may on any one or more occasions redeem up to 35% of
the original principal amount of the Notes (calculated after giving effect to any issuance of
Additional Notes) with the Net Cash Proceeds of one or more Equity Offerings by the Issuer, or with
the Net Cash Proceeds of one or more Equity Offerings by Parent that are contributed to the Issuer
as common equity capital, at a redemption price equal to 110.25% of the principal amount thereof,
plus accrued and unpaid interest thereon, if any, to the redemption date, subject to the right of
Holders of record on the relevant Record Date to receive interest due on the relevant Interest
Payment Date; provided that (1) at least 65% of the sum of the original principal amount of
the Notes (calculated after giving effect to any issuance of Additional Notes) remains outstanding
after the occurrence of each such redemption; and (2) such redemption occurs within 60 days of the
date of closing of each such Equity Offering. Any notice of redemption upon any Equity Offering
may be given prior to the completion of such Equity Offering, and any such redemption or notice
may, at the Issuer’s discretion, be subject to one or more conditions precedent, including, but not
limited to, completion of the related Equity Offering.




          (c) Except pursuant to clause (a) or (b) of this Section 3.07, the Notes shall not be
redeemable at the Issuer’s option prior to November 1, 2013.




          (d) On and after November 1, 2013, the Issuer may redeem all, or from time to time, a part of
the Notes upon notice pursuant to Section 3.03 at the redemption prices (expressed as percentages
of principal amount of the Notes to be redeemed) set forth below, plus accrued and unpaid interest
thereon, if any, to the applicable redemption date, subject to the right of Holders of record on
the relevant Record Date to receive interest due on the relevant Interest Payment Date, if redeemed
during the twelve-month period beginning on November 1 of the years indicated below:




	 	 	 	 	 
	Year	 	Percentage	 
	2013
	 	 	105.125	%
	2014
	 	 	102.563	%
	2015 and thereafter
	 	 	100.000	%






          (e) Any redemption pursuant to this Section 3.07 shall be made pursuant to the provisions of
Sections 3.01 through 3.06.




          (f) Any redemption or notice, may, at the Issuer’s discretion, be subject to one or more
conditions precedent, including completion of an Equity Offering or other corporate transaction.



Section 3.08 Mandatory Redemption.




          The Issuer shall not be required to make mandatory redemption or sinking fund payments with
respect to the Notes.



Section 3.09 Offers to Repurchase by Application of Excess Proceeds.




          (a) In the event that, pursuant to Section 4.10, the Issuer shall be required to commence an
Asset Sale Offer, the Issuer shall follow the procedures specified below.




          (b) The Asset Sale Offer will remain open for a period of 20 Business Days following its
commencement, except to the extent that a longer period is required by applicable law (the
“Asset Sale Offer Period”). No later than five Business Days after the termination of the
Asset Sale Offer Period (the “Asset Sale Purchase Date”), the Issuer will apply all Excess
Proceeds to the purchase of the






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aggregate principal amount of Notes and, if applicable, Pari Passu Indebtedness (on a pro rata
basis, if applicable) required to be purchased pursuant to Section 4.10 (the “Asset Sale Offer
Amount”), or, if less than the Asset Sale Offer Amount of Notes (and if applicable, Pari Passu
Indebtedness) has been so validly tendered, all Notes and Pari Passu Indebtedness validly tendered
in response to the Asset Sale Offer. Payment for any Notes so purchased will be made in the same
manner as interest payments are made.




          (c) If the Asset Sale Purchase Date is on or after a Record Date and on or before the related
Interest Payment Date, any accrued and unpaid interest up to but excluding the Asset Sale Purchase
Date, will be paid to the Person in whose name a Note is registered at the close of business on
such Record Date.




          (d) Upon the commencement of an Asset Sale Offer, the Issuer will mail (or otherwise
communicate in accordance with the procedures of DTC) a notice to each of the Holders, with a copy
to the Trustee. The notice shall contain all instructions and materials necessary to enable such
Holders to tender Notes pursuant to the Asset Sale Offer. The Asset Sale Offer shall be made to
all Holders and, if required, all holders of Pari Passu Indebtedness. The notice, which shall
govern the terms of the Asset Sale Offer, shall state:





     (1) that the Asset Sale Offer is being made pursuant to this Section 3.09 and Section
4.10 and the length of time the Asset Sale Offer shall remain open;




     (2) the Asset Sale Offer Amount, the purchase price, including the portion thereof
representing any accrued and unpaid interest, and the Asset Sale Purchase Date;




     (3) that any Note not properly tendered or accepted for payment shall continue to
accrue interest;




     (4) that, unless the Issuer defaults in making such payment, any Note accepted for
payment pursuant to the Asset Sale Offer will cease to accrue interest on and after the
Asset Sale Purchase Date;




     (5) that Holders electing to have a Note purchased pursuant to an Asset Sale Offer may
elect to have Notes purchased in amounts of $2,000 and larger integral multiples of $1,000
in excess thereof only;




     (6) that Holders electing to have a Note purchased pursuant to any Asset Sale Offer
shall be required to surrender the Note, with the form entitled “Option of Holder to Elect
Purchase” attached to the Note completed, or transfer by book-entry transfer, to the Issuer,
the Depositary, if appointed by the Issuer, or a Paying Agent at the address specified in
the notice at least three Business Days before the Asset Sale Purchase Date;




     (7) that Holders shall be entitled to withdraw their election if the Issuer, the
Depositary or the Paying Agent, as the case may be, receives at the address specified in the
notice, not later than one Business Day prior to the expiration of the Asset Sale Offer
Period, a telegram, facsimile transmission or letter setting forth the name of the Holder,
the principal amount of the Notes the Holder delivered for purchase and a statement that
such Holder is withdrawing his election to have such Note purchased;




     (8) that, if the aggregate principal amount of Notes and Pari Passu Indebtedness
surrendered by the holders thereof exceeds the Asset Sale Offer Amount, the Trustee shall
select the Notes and such Pari Passu Indebtedness to be purchased on a pro rata basis based
on the



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accreted value or principal amount of the Notes or such Pari Passu Indebtedness
tendered (with such adjustments as may be deemed appropriate by the Trustee so that only
Notes in denominations of $2,000 and larger integral multiples of $1,000 in excess thereof,
shall be purchased); and




     (9) that Holders whose Notes were purchased only in part shall be issued new Notes
equal in principal amount to the unpurchased portion of the Notes surrendered (or
transferred by book-entry transfer) representing the same Indebtedness to the extent not
repurchased.



          (e) On or before the Asset Sale Purchase Date, the Issuer will, to the extent lawful, accept
for payment, on a pro rata basis to the extent necessary, the Asset Sale Offer Amount of Notes and
Pari Passu Indebtedness or portions thereof so validly tendered and not properly withdrawn pursuant
to the Asset Sale Offer, or if less than the Asset Sale Offer Amount has been validly tendered and
not properly withdrawn, all Notes and Pari Passu Indebtedness so tendered, in each case in
denominations of $2,000 and integral multiples of $1,000 in excess
thereof; provided that if,
following repurchase of a portion of a Note, the remaining principal amount of such Note
outstanding immediately after such repurchase would be less than $2,000, then the portion of such
Note so repurchased shall be reduced so that the remaining principal amount of such Note
outstanding immediately after such repurchase is $2,000. The Issuer will deliver or cause to be
delivered to the Trustee the Notes so accepted and an Officers’ Certificate stating the aggregate
principal amount of Notes or portions thereof so accepted and that such Notes or portions thereof
were accepted for payment by the Issuer in accordance with the terms of this Section 3.09. In
addition, the Issuer will deliver all certificates and notes required, if any, by the agreements
governing the Pari Passu Indebtedness.




          (f) The Issuer or the Paying Agent, as the case may be, will promptly, but in any case not
later than five Business Days after termination of the Asset Sale Offer Period, mail or deliver to
each tendering Holder of the Notes or holder or lender of Pari Passu Indebtedness, as the case may
be, an amount equal to the purchase price of the Notes or Pari Passu Indebtedness so validly
tendered and not properly withdrawn by such Holder or lender, as the case may be, and accepted by
the Issuer for purchase, and the Issuer will promptly issue a new Note, and the Trustee, upon
receipt of an Authentication Order, will authenticate and mail or deliver (or cause to be
transferred by book-entry) such new Note to such Holder (it being understood that, notwithstanding
anything in this Indenture to the contrary, no Opinion of Counsel or Officers’ Certificate is
required for the Trustee to authenticate and mail or deliver such new Note) in a principal amount
equal to any unpurchased portion of the Note surrendered; provided that each such new Note will be
in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. In addition,
the Issuer will take any and all other actions required by the agreements governing the Pari Passu
Indebtedness. Any Note not so accepted shall be promptly mailed or delivered by the Issuer to the
Holder thereof. The Issuer will publicly announce the results of the Asset Sale Offer no later
than the next Business Day after the Asset Sale Purchase Date.




          Other than as specifically provided in this Section 3.09 or Section 4.10, any purchase
pursuant to this Section 3.09 shall be made pursuant to the applicable provisions of Sections 3.01
through 3.06.




ARTICLE 4




COVENANTS


Section 4.01 Payment of Notes; Additional Amounts.




          (a) The Issuer shall pay or cause to be paid the principal of and premium, if any, and
interest on the Notes on the dates and in the manner provided in the Notes. Principal, premium, if
any,





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and interest shall be considered paid on the date due if the Paying Agent, if other than one
of the Issuer or a Subsidiary of Parent or the Issuer, holds as of 11:00 a.m. (New York City time)
on the due date money deposited by the Issuer in immediately available funds and designated for and
sufficient to pay all principal, premium, if any, and interest then due.




          (b) The Issuer shall pay interest (including post-petition interest in any proceeding under
any Bankruptcy Law) on overdue principal and premium, if any, at the rate equal to the then
applicable interest rate on the Notes to the extent lawful; it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest (without regard to any applicable grace period) at the same rate to the extent lawful.




          (c) All payments made by Parent and each Parent Subsidiary Guarantor pursuant to its Notes
Guarantee will be made without withholding or deduction for any taxes imposed by any Canadian
taxing authority (a “Relevant Taxing Authority”), unless required by law or the
interpretation or administration thereof by such Relevant Taxing Authority. If any of Parent or
any Parent Subsidiary Guarantor is obligated to withhold or deduct any amount on account of taxes
imposed by any Canadian taxing authority from any payment made with respect to the Notes, such
Parent or such Parent Subsidiary Guarantor shall:





     (1) make such withholding or deduction;




     (2) remit the full amount deducted or withheld to the relevant government authority in
accordance with the applicable law;




     (3) pay such additional amounts (“Additional Amounts”) as may be necessary so
that the net amount received by each Holder of Notes (including Additional Amounts) after
such withholding or deduction will not be less than the amount such Holder would have
received if such taxes had not been withheld or deducted;




     (4) furnish to the Trustee for the benefit of the Holders of Notes, within 30 days
after the date of the payment of any taxes is due, an official receipt of the relevant
government authorities for all amounts deducted or withheld, or if such receipts are not
obtainable, other evidence of payment by the Parent or such Parent Subsidiary Guarantor of
those taxes; and




     (5) at least 15 days prior to each date on which any Additional Amounts are payable,
deliver to the Trustee an Officers’ Certificate setting forth the calculation of the
Additional Amounts to be paid and such other information as the Trustee may request to
enable the Trustee to pay such Additional Amounts to Holders of Notes on the payment date.


Notwithstanding the foregoing, no Parent or Parent Subsidiary Guarantor will pay Additional Amounts
to any Holder in respect of a beneficial owner of a Note: (i) which is subject to such taxes by
reason of its carrying on business in Canada, having a permanent establishment in Canada, being
organized under the laws of Canada (or a province thereof) or being an actual or deemed resident in
Canada; (ii) which is subject to taxes by reason of such Holder being non-arm’s length with the
Company or any Guarantor; or (iii) for or on account of any taxes imposed or withheld by reason of
the failure of the Holder or beneficial owner of the Note to complete, execute and deliver to such
Parent or Parent Subsidiary Guarantor any form or document to the extent applicable to such Holder
or beneficial owner that may be required by law or by reason of administration of such law and
which is reasonably requested in writing to be delivered to such Guarantor in order to enable such
Guarantor to make payments on the Notes without deduction or withholding for taxes, or with
deduction or withholding of a lesser amount, which form or document shall be delivered within 60
days of a written request therefor by such Guarantor.






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          Any reference in this Indenture or the Notes to the payment of principal, premium, if any,
interest, purchase price in connection with a purchase of Notes (including in connection with a
Change of Control or Asset Sale), redemption price or any other amount payable under or with
respect to any Note, will be deemed to include the payment of Additional Amounts to the extent
that, in such context, Additional Amounts are, were or would be payable in respect thereof. Parent
and such Parent Subsidiary Guarantor’s obligation to make payments of Additional Amounts will
survive any termination of this Indenture or the defeasance of any rights thereunder.



Section 4.02 Maintenance of Office or Agency.




          (a) The Issuer shall maintain an office or agency (which may be an office of the Trustee or an
affiliate of the Trustee, Registrar or co-registrar) where Notes may be surrendered for
registration of transfer or for exchange and where notices and demands to or upon the Issuer and
the Guarantors in respect of the Notes and this Indenture may be served. The Issuer shall give
prompt written notice to the Trustee of the location, and any change in the location, of such
office or agency. If at any time the Issuer shall fail to maintain any such required office or
agency or shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee.




          (b) The Issuer may also from time to time designate additional offices or agencies where the
Notes may be presented or surrendered for any or all such purposes and may from time to time
rescind such designations. The Issuer shall give prompt written notice to the Trustee of any such
designation or rescission and of any change in the location of any such other office or agency.




          (c) The Issuer hereby designates the Corporate Trust Office of the Trustee as one such office
or agency of the Issuer in accordance with Section 2.03.



Section 4.03 Reports and Other Information.




          (a) Notwithstanding that Parent may not be subject to the reporting requirements of Section 13
or 15(d) of the Exchange Act or otherwise report on an annual and quarterly basis on forms provided
for such annual and quarterly reporting pursuant to rules and regulations promulgated by the SEC,
to the extent permitted by the Exchange Act, Parent will file with the SEC, and make available to
the Trustee and through its publicly available website, the annual reports and the information,
documents and other reports (or copies of such portions of any of the foregoing as the SEC may by
rules and regulations prescribe) that are specified in Sections 13 and 15(d) of the Exchange Act
with respect to U.S. issuers within the time periods specified therein or in the relevant forms.




          (b) In the event that Parent is not permitted to file such reports, documents and information
with the SEC pursuant to the Exchange Act, Parent will nevertheless make available such Exchange
Act reports, documents and information to the Trustee and the Holders through its publicly
available website as if Parent were subject to the reporting requirements of Section 13 or 15(d) of
the Exchange Act within the time periods specified therein or in the relevant forms, which
requirement may be satisfied by posting such reports, documents and information on its website
within the time periods specified by this Section 4.03. Notwithstanding the foregoing, all
financial statements required by this paragraph shall include consolidating financial information
for Parent, the Issuer, the Guarantors (other than Parent) and Subsidiaries of the Issuer and
Parent that are not Guarantors in the manner prescribed by the SEC (including Rule 3-10 under
Regulation S-X) as if the Notes were registered with the SEC, provided that no consolidating cash
flow information shall be required to be provided until Parent provides financial information for
the fiscal period ended December 31, 2009.






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          (c) If the Issuer has designated any of its Subsidiaries as Unrestricted Subsidiaries and such
Unrestricted Subsidiaries, either individually or collectively, would otherwise have been a
Significant Subsidiary, then the quarterly and annual financial information required by the
preceding clause (b) shall include a reasonably detailed presentation, as determined in good faith
by senior management of the Issuer, either on the face of the financial statements or in the
footnotes to the financial statements and in “management’s discussion and analysis of financial
condition and results of operations”, of the financial condition and results of operations of the
Guarantors, the Issuer, and the Restricted Subsidiaries separate from the financial condition and
results of operations of the Unrestricted Subsidiaries.




          (d) The Issuer and the Guarantors will make available to the Holders and to prospective
investors, upon the request of such Holders, the information required to be delivered pursuant to
Rule 144A(d)(4) under the Securities Act so long as the Notes are not freely transferable under the
Securities Act. For purposes of this clause (d), the Issuer and the Guarantors will be deemed to
have furnished the reports to the Holders as required by this clause (d) if Parent has filed such
reports with the SEC via the EDGAR or any successor filing system and such reports are publicly
available.




          (e) So long as any Notes are outstanding, the Issuer or Parent or any direct or indirect
parent Issuer will also:





     (1) issue an “earnings” press release (consistent with past practice prior the Issue
Date) each quarter relating to annual and quarterly results of operations of Parent or the
Issuer;




     (2) hold a conference call each quarter (consistent with past practice prior to the
Issue Date) to discuss such results of operations for the relevant reporting period; and




     (3) issue a press release (consistent with past practice prior to the Issue Date) prior
to the date of each conference call required to be held in accordance with this paragraph,
announcing the time and date of such conference call and either including all information
necessary to access such call.


Such conference call shall (a) include a reasonable question and answer period of sufficient length
to allow conference call participants an opportunity to ask questions of management and for
management to provide detailed responses to such questions and (b) include the Issuer’s or Parent’s
chief executive officer or chief financial officer, or persons holding comparable roles, or, in the
event that after reasonable efforts neither the chief executive officer nor chief financial officer
is able to participate in the conference call, include as a substitute for such officer a senior
member of management of the Issuer. The Issuer or Parent will post a transcript of such conference
call (which shall include the question and answer period) to the Issuer’s or Parent’s publicly
available website using reasonable efforts to post such transcript as soon as reasonably possible,
but in no event later than five Business Days following such conference call. In the event such
transcript could reasonably be deemed a free writing prospectus under the Securities Act or an
offer to sell or a solicitation of an offer to buy securities of the Issuer, any of its
Subsidiaries or any parent of the Issuer, then the Issuer will not be required to post such
transcript to its website, and will be permitted to remove any such transcripts from such website




Section 4.04 Compliance Certificate.



          (a) The Issuer and each Guarantor (to the extent that such Guarantor is so required under the
Trust Indenture Act) shall deliver to the Trustee, within 100 days after the end of each fiscal
year ending after the Issue Date, a certificate from the principal executive officer, principal
financial officer or principal accounting officer stating that a review of the activities of the
Issuer and its Restricted Subsidiaries during the preceding fiscal year has been made under the
supervision of the signing Officer





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with a view to determining whether the Issuer has kept, observed, performed and fulfilled its
obligations under this Indenture, and further stating, as to such Officer signing such certificate,
that to the best of his or her knowledge, the Issuer has kept, observed, performed and fulfilled
each and every condition and covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions, covenants and conditions of this
Indenture (or, if a Default shall have occurred, describing all such Defaults of which he or she
may have knowledge and what action the Issuer is taking or proposes to take with respect thereto).




          (b) When any Default has occurred and is continuing under this Indenture, or if the Trustee or
the holder of any other evidence of Indebtedness of the Issuer or any Restricted Subsidiary gives
any notice or takes any other action with respect to a claimed Default, the Issuer shall promptly
(which shall be no more than five Business Days following the date on which the Issuer becomes
aware of such Default, receives such notice or becomes aware of such action, as applicable) send to
the Trustee an Officers’ Certificate specifying such event and what action the Issuer proposes to
take with respect thereto.



Section 4.05 Taxes.




          The Issuer shall pay, and shall cause each of its Restricted Subsidiaries to pay, prior to
delinquency, all material taxes, assessments and governmental levies except such as are contested
in good faith and by appropriate negotiations or proceedings or where the failure to effect such
payment is not adverse in any material respect to the Holders.



Section 4.06 Stay, Extension and Usury Laws.




          The Issuer and each Guarantor covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in
force, that may affect the covenants or the performance of this Indenture; and the Issuer and each
Guarantor (to the extent that it may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenant that it shall not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but shall suffer and permit the
execution of every such power as though no such law has been enacted.



Section 4.07 Limitation on Restricted Payments.




          (a) The Issuer will not, and will not permit any of the Restricted Subsidiaries, directly or
indirectly, to:





     (1) declare or pay any dividend or make any distribution (whether made in cash,
securities or other property) on or in respect of the Issuer’s, or any of its Restricted
Subsidiaries’ Capital Stock (including any payment in connection with any merger or
consolidation involving the Issuer or any of its Restricted Subsidiaries) other than:




     (A) dividends or distributions by the Issuer payable solely in Capital Stock
(other than Disqualified Stock) of the Issuer; or




     (B) dividends or distributions by a Restricted Subsidiary so long as, in the
case of any dividend or distribution payable on or in respect of any Capital Stock
issued by a Restricted Subsidiary that is not a Wholly-Owned Subsidiary, the Issuer
or Restricted Subsidiary holding such Capital Stock receives at least its pro rata
share of such dividend or distribution;



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     (2) purchase, redeem, retire or otherwise acquire for value any Capital Stock of the
Issuer or any direct or indirect parent of the Issuer held by Persons other than the Issuer
or a Restricted Subsidiary (other than in exchange for Capital Stock of the Issuer (other
than Disqualified Stock)), including in connection with any merger or consolidation;




     (3) make any principal payment on, or purchase, repurchase, redeem defease or otherwise
acquire or retire for value, prior to any scheduled repayment, scheduled sinking fund
payment or scheduled maturity, any Subordinated Obligations or Guarantor Subordinated
Obligations, other than:




     (A) Indebtedness of the Issuer owing to and held by any Guarantor or
Indebtedness of a Guarantor owing to and held by the Issuer or any other Guarantor
permitted under clause (4) of Section 4.09(b); or




     (B) the purchase, repurchase redemption, defeasance or other acquisition or
retirement of Subordinated Obligations or Guarantor Subordinated Obligations
purchased in anticipation of satisfying a sinking fund obligation, principal
installment or final maturity, in each case due within one year of the date of
purchase, repurchase redemption, defeasance or other acquisition or retirement; or




     (4) make any Restricted Investment in any Person;


(all such payments and other actions referred to in clauses (1) through (4) (other than any
exception thereto) shall be collectively referred to as a “Restricted Payment”), unless, at
the time of and after giving effect to such Restricted Payment:





     (A) no Default shall have occurred and be continuing (or would result
therefrom);




     (B) the Issuer could Incur $1.00 of additional Secured Funded Indebtedness
pursuant to Section 4.07(a)(1) of after giving effect, on a pro forma basis, to such
Restricted Payment; and




     (C) the aggregate amount of such Restricted Payment and all other Restricted
Payments declared or made subsequent to the Issue Date (excluding Restricted
Payments made pursuant to clauses (1), (2), (3), (8), (9), (10) and (11) of Section
4.09(b)) would not exceed the sum of (without duplication):




          (i) 100% of Adjusted EBITDA of the Issuer and its Restricted Subsidiaries for
the period (treated as one accounting period) from the beginning of the first fiscal
quarter commencing after the Issue Date to the end of the most recent fiscal quarter
ending prior to the date of such Restricted Payment for which financial statements
are available less 1.6 times Consolidated Applicable Interest Charge of the Issuer
and its Restricted Subsidiaries for the same period; plus




          (ii) 100% of the aggregate Net Cash Proceeds received by the Issuer from the
issue or sale of its Capital Stock (other than Disqualified Stock) or other capital
contributions subsequent to the Issue Date (other than Net Cash Proceeds received
from an issuance or sale of such Capital Stock to a Subsidiary of the Issuer or to
an employee stock ownership plan, option plan or similar trust to the extent such
sale to an employee stock ownership plan or similar trust is financed by loans from
or Guaranteed by the Issuer or any Restricted Subsidiary unless such loans have been
repaid with cash on or



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prior to the date of determination) excluding in any event Net Cash Proceeds
received by the Issuer from the issue and sale of its Capital Stock or capital
contributions to the extent applied to redeem Notes in compliance with Section
3.07(b); plus




          (iii) the amount by which Indebtedness of the Issuer or its Restricted
Subsidiaries is reduced on the Issuer’s consolidated balance sheet upon the
conversion or exchange (other than by a Subsidiary of the Issuer) subsequent to the
Issue Date of any Indebtedness of the Issuer or its Restricted Subsidiaries for
Capital Stock (other than Disqualified Stock) of the Issuer or the Parent (less the
amount of any cash, or the fair market value of any other property, distributed by
the Issuer upon such conversion or exchange); plus




          (iv) the amount equal to the net reduction in Restricted Investments made by
the Issuer or any of the Restricted Subsidiaries in any Person resulting from:




          (A) repurchases or redemptions of such Restricted Investments by such
Person, proceeds realized upon the sale of such Restricted Investment to an
unaffiliated purchaser, repayments of loans or advances or other transfers
of assets (including by way of dividend or distribution) by such Person to
the Issuer or any Restricted Subsidiary (other than for reimbursement of tax
payments); or




          (B) the redesignation of Unrestricted Subsidiaries as Restricted
Subsidiaries or the merger or consolidation of an Unrestricted Subsidiary
with and into the Issuer or any of its Restricted Subsidiaries (valued in
each case as provided in the definition of “Investment”) not to exceed the
amount of Investments previously made by the Issuer or any Restricted
Subsidiary in such Unrestricted Subsidiary,




which amount in each case under this clause (iv) was included in the
calculation of the amount of Restricted Payments; provided, however, that no amount
will be included under this clause (iv) to the extent it is already included in
Adjusted EBITDA; plus




     (v) $10,000,000.



          (b) The foregoing provisions of Section 4.07(a) will not prohibit:





     (1) any purchase, repurchase, redemption, defeasance or other acquisition or retirement
of Capital Stock, Disqualified Stock or Subordinated Obligations of the Issuer or Guarantor
Subordinated Obligations of any LGEI Subsidiary Guarantor made by exchange for, or out of
the proceeds of the substantially concurrent sale of, Capital Stock of the Issuer or
contributions to the equity capital of the Issuer (other than Disqualified Stock and other
than Capital Stock issued or sold to a Subsidiary of the Issuer or an employee stock
ownership plan or similar trust to the extent such sale to an employee stock ownership plan
or similar trust is financed by loans from or Guaranteed by the Issuer or any Restricted
Subsidiary unless such loans have been repaid with cash on or prior to the date of
determination); provided, however, that the Net Cash Proceeds from such sale
of Capital Stock will be excluded from clause (C)(ii) of Section 4.07(a);




     (2) any purchase, repurchase, redemption, defeasance or other acquisition or retirement
of Subordinated Obligations of the Issuer or Guarantor Subordinated Obligations of any LGEI
Subsidiary Guarantor made by exchange for, or out of the proceeds of the substantially



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concurrent sale of, Subordinated Obligations of the Issuer or any purchase, repurchase,
redemption, defeasance or other acquisition or retirement of Guarantor Subordinated
Obligations made by exchange for or out of the proceeds of the substantially concurrent sale
of Guarantor Subordinated Obligations that, in each case, is permitted to be Incurred
pursuant to Section 4.09 and that, in each case, constitutes Refinancing Indebtedness;




     (3) any purchase, repurchase, redemption, defeasance or other acquisition or retirement
of Disqualified Stock of the Issuer or a Restricted Subsidiary made by exchange for or out
of the proceeds of the substantially concurrent sale of Disqualified Stock of the Issuer or
such Restricted Subsidiary, as the case may be, that, in each case, is permitted to be
Incurred pursuant to Section 4.09 and that, in each case, constitutes Refinancing
Indebtedness;




     (4) the purchase, repurchase, redemption, defeasance or other acquisition or retirement
for value of any Subordinated Obligation (A) at a purchase price not greater than 101% of
the principal amount of such Subordinated Obligation plus accrued interest in the event of a
Change of Control in accordance with provisions similar to Section 4.14 or (B) at a purchase
price not greater than 100% of the principal amount thereof plus accrued interest in
accordance with provisions similar to Section 4.10; provided that, prior to or
simultaneously with such purchase, repurchase, redemption, defeasance or other acquisition
or retirement, the Issuer has made the Change of Control Offer or Asset Sale Offer, as
applicable, as provided in Section 4.14 or Section 4.10, with respect to the Notes and has
completed the repurchase or redemption of all Notes validly tendered for payment in
connection with such Change of Control Offer or Asset Sale Offer;




     (5) any purchase or redemption of Subordinated Obligations or Guarantor Subordinated
Obligations of an LGEI Subsidiary Guarantor from Net Available Cash to the extent permitted
under Section 4.10;




     (6) dividends or distributions paid within 60 days after the date of declaration if at
such date of declaration such dividends or distributions would have complied with this
provision;




     (7) the purchase, redemption or other acquisition, cancellation or retirement for value
of Capital Stock, or options, warrants, equity appreciation rights or other rights to
purchase or acquire Capital Stock of the Issuer, Parent or any other direct or indirect
parent of the Issuer held by any existing or former employees or management of the Issuer,
Parent or any Subsidiary of the Issuer or of Parent or their assigns, estates or heirs, or
cash dividends distributed to Parent or any other parent of the Issuer for the purpose of
consummating such purchase, redemption or other acquisition, cancellation or retirement for
value, in each case in connection with the repurchase provisions under employee stock option
or stock purchase agreements or other agreements to compensate management employees approved
by the Board of Directors; provided that such Capital Stock, or options, warrants,
equity appreciation rights or other rights to purchase or acquire Capital Stock, were
received for services related to, or for the benefit of, Parent and the Issuer and the
Restricted Subsidiaries; and provided, further that such redemptions or
repurchases pursuant to this clause (7) will not exceed $7,500,000 in the aggregate during
any calendar year, although such amount in any calendar year may be increased by an amount
not to exceed:




     (A) the Net Cash Proceeds from the sale of Capital Stock (other than
Disqualified Stock) of the Issuer and, to the extent contributed to the Issuer,
Capital Stock of any of the Issuer’s other direct or indirect parent companies, in
each case to existing or former employees or members of management of the Issuer,
any of its Subsidiaries, Parent or any of its direct or indirect parent companies
that occurs after the Issue Date, to the extent the cash proceeds from the sale of
such Capital Stock have not otherwise been



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applied to the payment of Restricted Payments (provided that the Net
Cash Proceeds from such sales or contributions will be excluded from clause (C)(ii)
of Section 4.07(a)); plus




     (B) the cash proceeds of key man life insurance policies received by the Issuer
or its Restricted Subsidiaries after the Issue Date; less




     (C) the amount of any Restricted Payments made with cash proceeds described in
the clauses (A) and (B) of this clause (7)




provided, further, that the aggregate amount of Restricted Payments made
pursuant to this clause (7) shall not exceed $17,500,000 in the aggregate;




     (8) the declaration and payment of dividends to holders of any class or series of
Disqualified Stock of the Issuer issued in accordance with the terms of this Indenture;




     (9) repurchases of Capital Stock deemed to occur upon the exercise of stock options,
warrants, other rights to purchase Capital Stock or other convertible securities if such
Capital Stock represents a portion of the exercise price thereof;




     (10) the declaration and payment of cash dividends, distributions, loans or other
transfers by the Issuer to Parent in amounts required for Parent to pay, in each case
without duplication:




     (A) Canadian federal, provincial or local income taxes payable to the extent
that such income taxes are directly attributable to the income of the Issuer and the
Restricted Subsidiaries (rather than the income of Parent resulting from
distributions of property from the Issuer or any Restricted Subsidiary) and only to
the extent such taxes are not offset by applicable tax credits, tax losses or other
assets; provided that in each case the amount of such payments in any fiscal year
does not exceed the amount that the Issuer and its Restricted Subsidiaries would be
required to pay in respect of foreign, federal, state and local taxes for such
fiscal year were the Issuer and its Restricted Subsidiaries to pay such taxes
separately from any such parent entity;




     (B) franchise taxes and other fees required to maintain Parent’s legal
existence; and




     (C) an amount not to exceed $2,500,000 in any fiscal year to permit Parent to
pay its corporate overhead expenses Incurred in the ordinary course of business, and
to pay salaries or other compensation of employees who perform services for both
Parent and the Issuer;




     (11) the purchase of call options to hedge the Issuer’s or any Restricted Subsidiary’s
exposure in connection with the issuance of the Existing Convertible Notes, which call
options are to be settled on a net (not cash) basis; and




     (12) other Restricted Payments made in an aggregate amount (as reduced by the amount of
capital returned from any such Restricted Payments that constituted Restricted Investments
in the form of cash and Cash Equivalents (exclusive of items reflected in Consolidated Net
Income)) from the Issue Date not to exceed $25,000,000.



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provided, however, that at the time of and after giving effect to, any Restricted
Payment permitted under clauses (5), (7), (8), (11) and (12) of this Section 4.07(b), no Default
shall have occurred and be continuing or would occur as a consequence thereof.




          (c) The amount of all Restricted Payments (other than cash) shall be the Fair Market Value on
the date of such Restricted Payment of the asset(s) or securities proposed to be paid, transferred
or issued by the Issuer or such Restricted Subsidiary, as the case may be, pursuant to such
Restricted Payment. Such determination of Fair Market Value shall be based upon an opinion or
appraisal issued by an Independent Financial Advisor if such Fair Market Value is estimated in good
faith by the Board of Directors of the Issuer to exceed $5,000,000. Not later than the date of
making any Restricted Payment, the Issuer shall deliver to the Trustee an Officers’ Certificate
stating that such Restricted Payment is permitted and setting forth the basis upon which the
calculations required by this Section 4.07 were computed, together with a copy of any fairness
opinion or appraisal required by this Indenture.




          (d) As of the Issue Date, all of the Issuer’s Subsidiaries will be Restricted Subsidiaries,
except for the Initial Unrestricted Subsidiary and the Excluded Subsidiaries (which include
LionsGate Channels, Inc. and its Subsidiaries). The Issuer will not permit any Unrestricted
Subsidiary to become a Restricted Subsidiary except in accordance with the definition of
“Unrestricted Subsidiary.” For purposes of designating any Restricted Subsidiary as an
Unrestricted Subsidiary, all outstanding Investments by the Issuer and its Restricted Subsidiaries
(except to the extent repaid) in the Subsidiary so designated will be deemed to be Restricted
Payments in an amount determined as set forth in the definition of “Investment.” Such designation
will be permitted only if a Restricted Payment in such amount would be permitted at such time and
if such Subsidiary otherwise meets the definition of an Unrestricted Subsidiary. Unrestricted
Subsidiaries will not be subject to any of the restrictive covenants set forth in this Indenture.



Section 4.08 Limitation on Restrictions on Distribution from Restricted Subsidiaries.




          (a) The Issuer will not, and will not permit any Restricted Subsidiary to, directly or
indirectly, create or otherwise cause or permit to exist or become effective any consensual
encumbrance or consensual restriction on the ability of any Restricted Subsidiary to:




     (1) pay dividends or make any other distributions on its Capital Stock to the Issuer or
any of its Restricted Subsidiaries, or with respect to any other interest or participation
in, or measured by, its profits, or pay any Indebtedness or other obligations owed to the
Issuer or any Restricted Subsidiary (it being understood that the priority of any Preferred
Stock in receiving dividends or liquidating distributions prior to dividends or liquidating
distributions being paid on Common Stock shall not be deemed a restriction on the ability to
make distributions on Capital Stock);




     (2) make any loans or advances to the Issuer or any Restricted Subsidiary (it being
understood that the subordination of loans or advances made to the Issuer or any Restricted
Subsidiary to other Indebtedness Incurred by the Issuer or any Restricted Subsidiary shall
not be deemed a restriction on the ability to make loans or advances); or




     (3) sell, lease or transfer any of its property or assets to the Issuer or any
Restricted Subsidiary (it being understood that such transfers shall not include any type of
transfer described in clause (1) or (2) above).



          (b) The restrictions in Section 4.08(a) will not apply to encumbrances or restrictions
existing under or by reason of:






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     (1) contractual encumbrances or restrictions pursuant to an agreement in effect on the
Issue Date, including without limitation, the Collateral Documents, the Senior Credit
Facility and the Existing Convertible Notes (and related documentation) in effect on such
date;




     (2) this Indenture, the Notes and the Notes Guarantees;




     (3) any agreement or other instrument of a Person acquired by the Issuer or any of its
Restricted Subsidiaries in existence at the time of such acquisition (but not created in
contemplation thereof), which encumbrance or restriction is not applicable to any Person, or
the properties or assets of any Person, other than the Person and its Subsidiaries, or the
property or assets of the Person and its Subsidiaries, so acquired (including after acquired
property);




     (4) any amendment, restatement, modification, renewal, supplement, refunding,
replacement or refinancing of an agreement referred to in clauses (1), (2) or (3) of this
Section 4.08(b) or this clause (4); provided, however, that such amendments,
restatements, modifications, renewals, supplements, refundings, replacements or refinancings
are, in the good faith judgment of the Issuer, no less favorable in any material respect,
taken as a whole, to the Holders of the Notes than the encumbrances and restrictions
contained in the agreements referred to in clauses (1), (2) or (3) of this Section 4.08(b)
on the Issue Date or, in the case of a Restricted Subsidiary, the date such Restricted
Subsidiary became a Restricted Subsidiary or was merged into a Restricted Subsidiary,
whichever is applicable;




     (5) in the case of clause (3) of Section 4.08(a), Liens permitted to be Incurred under
the provisions of Section 4.12 that limit the right of the debtor to dispose of the assets
securing such Indebtedness;




     (6) purchase money obligations for property acquired in the ordinary course of business
and Capitalized Lease Obligations permitted under this Indenture, in each case, that impose
encumbrances or restrictions of the nature described in clause (3) of Section 4.08(a) on the
property so acquired;




     (7) restrictions on cash or other deposits or net worth imposed by customers or by
co-production, joint venture or similar parties under contracts entered into in the ordinary
course of business;




     (8) any customary provisions in joint venture agreements relating to joint ventures
that are not Restricted Subsidiaries and other similar agreements entered into in the
ordinary course of business;




     (9) any customary provisions in leases, subleases or licenses and other agreements
entered into by the Issuer or any Restricted Subsidiary in the ordinary course of business;




     (10) encumbrances or restrictions arising or existing by reason of applicable law or
any applicable rule, regulation or order;




     (11) any restriction with respect to a Restricted Subsidiary imposed pursuant to an
agreement entered into for the sale or disposition of all or substantially all the Capital
Stock or assets of such Restricted Subsidiary pending the closing of such sale or
disposition; and




     (12) imposed by any agreement relating to Indebtedness or Investments, as applicable,
permitted to be Incurred pursuant to Section 4.09 or clauses (11), (16), (19) and (22) of
the definition of “Permitted Investment,” in each case, if such restrictions or conditions
apply only to



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the property or assets securing such Indebtedness or Investments and/or only to the
Restricted Subsidiary incurring such Indebtedness or Investments or its Subsidiaries.


Section 4.09 Limitation on Indebtedness.




          (a) (1) The Issuer will not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly, Incur any Secured Funded Indebtedness (including Acquired Indebtedness that
constitutes Secured Funded Indebtedness); provided, however, that the Issuer and
the LGEI Subsidiary Guarantors may Incur Secured Funded Indebtedness if on the date thereof and
after giving effect thereto on a pro forma basis:





     (A) the Secured Leverage Ratio is at least 2.00 to 1.00 and the Consolidated
Leverage Ratio is at least 1.00 to 1.00; and;




     (B) no Default or Event of Default will have occurred or be continuing or would
occur as a consequence of Incurring such Secured Funded Indebtedness or transactions
relating to such Incurrence.




     (2) The Issuer will not, and will not permit any of its Restricted Subsidiaries to,
directly or indirectly Incur any Indebtedness (including Acquired Indebtedness); provided,
however, that the Issuer and the LGEI Subsidiary Guarantors may Incur Indebtedness if on the
date thereof and after giving effect thereto on a pro forma basis:




     (A) the Consolidated Leverage Ratio is at least 1.00 to 1.00; and




     (B) no Default or Event of Default will have occurred or be continuing or would
occur as a consequence of Incurring such Indebtedness or transactions relating to
such Incurrence.



          (b) The provisions of Section 4.09(a) shall not prohibit the Incurrence of the following
Indebtedness:





     (1) (A) Indebtedness under the Senior Credit Facility in an aggregate principal amount
not to exceed $340,000,000, less the amount of such Indebtedness that is permanently retired
with the Net Proceeds from any Asset Sale after the Issue Date to reduce such amounts
outstanding pursuant to Section 4.10(a)(3)(A), and (B) Indebtedness represented by the Notes
(including any Notes Guarantee) (other than any Additional Notes);




     (2) Indebtedness of the Issuer and its Restricted Subsidiaries in existence on the
Issue Date (other than Indebtedness described in clauses (1), (3), (4), (6), (8), (9), (10),
(12), (13), (14) and (18) of this Section 4.09(b));




     (3) Guarantees by (A) the Issuer or the LGEI Subsidiary Guarantors of Indebtedness
permitted to be Incurred by the Issuer or an LGEI Subsidiary Guarantor in accordance with
the provisions of this Indenture; provided that in the event such Indebtedness that is being
Guaranteed is a Subordinated Obligation or a Guarantor Subordinated Obligation, then the
related Guarantee shall be subordinated in right of payment to the Notes or the Notes
Guarantee, as the case may be substantially to the same extent as such Indebtedness is
subordinated to the Notes or Notes Guarantee, as applicable, and (B) Non-Guarantor
Subsidiaries of Indebtedness Incurred by Non-Guarantor Subsidiaries in accordance with the
provisions of this Indenture;



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     (4) Indebtedness of the Issuer owing to and held by any Wholly-Owned Subsidiary or
Indebtedness of a Restricted Subsidiary owing to and held by the Issuer or any Wholly-Owned
Subsidiary; provided, however,




     (A) if the Issuer is the obligor on Indebtedness owing to a Non-Guarantor
Subsidiary, such Indebtedness is expressly subordinated to the prior payment in full
in cash of all obligations with respect to the Notes;




     (B) if an LGEI Subsidiary Guarantor is the obligor on such Indebtedness and the
Issuer or an LGEI Subsidiary Guarantor is not the obligee, such Indebtedness is
subordinated in right of payment to the Notes Guarantee of such LGEI Subsidiary
Guarantor; and




     (C) (i) any subsequent issuance or transfer of Capital Stock or any other
event which results in any such Indebtedness being beneficially held by a Person
other than the Issuer or a Wholly-Owned Subsidiary of the Issuer; and




     (ii) any sale or other transfer of any such Indebtedness to a Person
other than the Issuer or a Wholly-Owned Subsidiary of the Issuer




shall be deemed, in each case, to constitute an Incurrence of such Indebtedness by
the Issuer or such Subsidiary, as the case may be.




     (5) Indebtedness of an LGEI Subsidiary Guarantor Incurred and outstanding on the date
on which such LGEI Subsidiary Guarantor became a Restricted Subsidiary or was acquired by,
or merged into, the Issuer or any Restricted Subsidiary (other than Indebtedness Incurred
(A) to provide all or any portion of the funds utilized to consummate the transaction or
series of related Transactions pursuant to which such LGEI Subsidiary Guarantor became a
Restricted Subsidiary or was otherwise acquired by the Issuer or (B) otherwise in connection
with, or in contemplation of, such acquisition); provided, however, that at
the time such Person is acquired the Issuer would have been able to Incur $1.00 of
additional Indebtedness pursuant to the applicable provisions of Section 4.09(a) after
giving pro forma effect to such merger or acquisition and to the Incurrence of such
Indebtedness pursuant to this clause (5); or




     (6) Indebtedness under Hedging Obligations that are Incurred in the ordinary course of
business (and not for speculative purposes) (A) for the purpose of fixing or hedging
interest rate risk with respect to any Indebtedness Incurred in accordance with this
Indenture; (B) for the purpose of fixing or hedging currency exchange rate risk with respect
to any currency exchanges; or (C) for the purpose of fixing or hedging commodity price risk
with respect to any commodities;




     (7) Indebtedness (including Capitalized Lease Obligations) of the Issuer or a
Restricted Subsidiary Incurred to finance the purchase, lease, construction or improvement
of any property, plant or equipment used or to be used in the business of the Issuer or such
Restricted Subsidiary, whether through the direct purchase of such property, plant or
equipment or the purchase of Capital Stock of any Person owning such property, plant or
equipment (but no other material assets), and any Indebtedness of the Issuer or a Restricted
Subsidiary which serves to refund or refinance any Indebtedness Incurred pursuant to this
clause (7), in a principal amount, not to exceed $20,000,000 at any time outstanding
together with all other Indebtedness issued under this clause (7);



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     (8) Indebtedness Incurred by the Issuer or its Restricted Subsidiaries in respect of
workers’ compensation claims, health, disability or other employee benefits or property,
casualty or liability insurance, self-insurance obligations, performance, bid surety and
similar bonds and completion Guarantees (not for borrowed money) provided by the Issuer or a
Restricted Subsidiary in the ordinary course of business;




     (9) Indebtedness arising from agreements of the Issuer or a Restricted Subsidiary
providing for indemnification, adjustment of purchase price or similar obligations, in each
case, Incurred or assumed in connection with the disposition of any business or assets of
the Issuer or any business, assets or Capital Stock of a Restricted Subsidiary, other than
Guarantees of Indebtedness Incurred by any Person acquiring all or any portion of such
business, assets or a Subsidiary for the purpose of financing such acquisition,
provided that:




     (A) the maximum aggregate liability in respect of all such Indebtedness shall
at no time exceed the gross proceeds including non-cash proceeds (the fair market
value of such non-cash proceeds being measured at the time received and without
giving effect to subsequent changes in value) actually received by the Issuer and
the Restricted Subsidiaries in connection with such disposition; and




     (B) such Indebtedness is not reflected on the balance sheet of the Issuer or
any of the Restricted Subsidiaries (contingent obligations referred to in a
footnote to financial statements and not otherwise reflected on the balance sheet
will not be deemed to be reflected on such balance sheet for purposes of this clause
(9);




     (10) Indebtedness arising from the honoring by a bank or other financial institution of
a check, draft or similar instrument (except in the case of daylight overdrafts) drawn
against insufficient funds in the ordinary course of business; provided,
however, that such Indebtedness is extinguished within five Business Days of
Incurrence;




     (11) the Incurrence or issuance by the Issuer or any Restricted Subsidiary of
Refinancing Indebtedness that serves to refund or refinance any Indebtedness Incurred as
permitted under Section 4.09(a) and clauses (2), (5) and this clause (11) of this Section
4.09(b) or any Indebtedness issued to so refund or refinance such Indebtedness, including
additional Indebtedness Incurred to pay premiums (including reasonable, as determined in
good faith by the Issuer, tender premiums), defeasance costs, accrued interest and fees and
expenses in connection therewith prior to its respective maturity;




     (12) Indebtedness incurred by the Issuer or any Restricted Subsidiary that is a Special
Purpose Producer which is non-recourse to the Issuer or any Restricted Subsidiary other than
such Special Purpose Producer, except to the extent that a Negative Pick-up Obligation,
Program Acquisition Guarantee or short-fall guarantee would be considered recourse
Indebtedness of the Issuer or any of its Restricted Subsidiaries;




     (13) Indebtedness incurred by SlateCo in connection with the Permitted Slate Financing;




     (14) Replication Advances not to exceed $75,000,000 in the aggregate at any one time
outstanding, which are otherwise entered into in the ordinary course of business and on
terms and conditions substantially no less favorable in any material respect, taken as a
whole, to the Issuer as similar transactions entered into by the Issuer or its Subsidiaries
prior to the Issue Date; provided that, the granting of a Lien in respect of the related
assets, which is junior in right to the



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Lien on such assets which secures the Notes, to secure any such Replication Advances
will not be considered to be less favorable to the Issuer;




     (15) Indebtedness secured solely by liens on Acceptable Tax Credits which is
non-recourse to the Issuer and any Restricted Subsidiary, other than customary
representations and warranties made to the applicable taxing authority to the extent that
any such representation or warranty would be considered recourse Indebtedness of the Issuer
or any of its Restricted Subsidiaries;




     (16) liabilities relating to profit participations, deferments and guild residuals
arising in the ordinary course of business in connection with the production, acquisition or
distribution of Product;




     (17) unsecured liabilities (including without limitation Guarantees) or liabilities
(including without limitation Guarantees) secured solely by the related rights (which
security is non-recourse to any other assets of the Issuer or a Restricted Subsidiary) (a)
related to the acquisition, production or distribution of Product or acquisitions of rights
incurred in the ordinary course of business (including co-productions, co-ventures and other
co-financing arrangements), which are not otherwise prohibited hereunder or (b) related to
the Special Purpose Joint Venture in an amount no greater than $15,000,000 in the aggregate
at any one time outstanding;




     (18) Indebtedness pursuant to the Pennsylvania Regional Financing Arrangement in an
amount no greater than $66,000,000;




     (19) Negative Pick-up Obligations and direct or indirect guarantees (including minimum
guarantees) related to the acquisition or production of items of Product in the ordinary
course of business to the extent otherwise permitted under this Indenture; and




     (20) in addition to the items referred to in clauses (1) through (19) above,
Indebtedness of the Issuer and the LGEI Subsidiary Guarantors in an aggregate outstanding
principal amount which, when taken together with the principal amount of all other
Indebtedness Incurred pursuant to this clause (20) and then outstanding, will not exceed
$20,000,000 at any time outstanding.



          (c) The Issuer will not Incur any Indebtedness under Section 4.09(b) if the proceeds thereof
are used, directly or indirectly, to refinance any Subordinated Obligations of the Issuer unless
such Indebtedness will be subordinated to the Notes to at least the same extent as such
Subordinated Obligations. No LGEI Subsidiary Guarantor will Incur any Indebtedness under Section
4.09(b) if the proceeds thereof are used, directly or indirectly, to refinance any Guarantor
Subordinated Obligations of such LGEI Subsidiary Guarantor unless such Indebtedness will be
subordinated to the obligations of such LGEI Subsidiary Guarantor under its Notes Guarantee to at
least the same extent as such Guarantor Subordinated Obligations. No Restricted Subsidiary (other
than an LGEI Subsidiary Guarantor) may Incur any Indebtedness if the proceeds are used to refinance
Indebtedness of the Issuer or an LGEI Subsidiary Guarantor.




          (d) For purposes of determining compliance with, and the outstanding principal amount of any
particular Indebtedness Incurred pursuant to and in compliance with, this Section 4.09:





     (1) subject to clause (2) below, in the event that Indebtedness meets the criteria of
more than one of the types of Indebtedness described in Section 4.09(a) or 4.09(b), the
Issuer, in its sole discretion, will classify such item (or portion) of Indebtedness on the
date of Incurrence and may later reclassify such item (or portion) of Indebtedness in any
manner that complies with



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this Section 4.09 and only be required to include the amount and type of such
Indebtedness in one of such clauses; provided that Indebtedness under the Senior
Credit Facility shall in any event be deemed to be Incurred solely under clause (1)(A) of
Section 4.09(b);




     (2) Guarantees of, or obligations in respect of letters of credit relating to,
Indebtedness that is otherwise included in the determination of a particular amount of
Indebtedness shall not be included;




     (3) if obligations in respect of letters of credit are Incurred pursuant to a Credit
Facility and are being treated as Incurred pursuant to Section 4.09(a) and the letters of
credit relate to other Indebtedness, then such other Indebtedness shall not be included;




     (4) the principal amount of any Disqualified Stock of the Issuer or a Restricted
Subsidiary, or Preferred Stock of a Restricted Subsidiary that is not an LGEI Subsidiary
Guarantor, will be, subject to the next succeeding paragraph, equal to the greater of the
maximum mandatory redemption or repurchase price (not including, in either case, any
redemption or repurchase premium) or the liquidation preference thereof;




     (5) Indebtedness permitted by this Section 4.09 need not be permitted solely by
reference to one provision permitting such Indebtedness but may be permitted in part by one
such provision and in part by one or more other provisions of this Section 4.09 permitting
such Indebtedness provided that Indebtedness under the Senior Credit Facility shall in any
event be deemed to be incurred solely under clause (1)(A) of Section 4.09(b);




     (6) the principal amount of any Indebtedness outstanding in connection with a
securitization transaction or series of securitization transactions is the amount of
obligations outstanding under the legal documents entered into as part of such transaction
that would be characterized as principal if such transaction were structured as a secured
lending transaction rather than as a purchase relating to such transaction; and




     (7) the amount of Indebtedness issued at a price that is less than the principal amount
thereof will be equal to the amount of the liability in respect thereof determined in
accordance with GAAP.



          Accrual of interest, accrual of dividends, the accretion of accreted value or the amortization
of debt discount, the payment of interest in the form of additional Indebtedness and the payment of
dividends in the form of additional shares of Preferred Stock or Disqualified Stock will not be
deemed to be an Incurrence of Indebtedness for purposes of this Section 4.09. The amount of any
Indebtedness outstanding as of any date shall be (i) the accreted value thereof in the case of any
Indebtedness issued with original issue discount or the aggregate principal amount outstanding in
the case of Indebtedness issued with interest payable in kind and (ii) the principal amount or
liquidation preference thereof, together with any interest thereon that is more than 30 days past
due, in the case of any other Indebtedness.




          In addition, the Issuer will not permit any of its Unrestricted Subsidiaries to Incur any
Indebtedness or issue any shares of Disqualified Stock, other than Non-Recourse Debt. If at any
time an Unrestricted Subsidiary becomes a Restricted Subsidiary, any Indebtedness of such
Subsidiary shall be deemed to be Incurred by a Restricted Subsidiary as of such date (and, if such
Indebtedness is not permitted to be Incurred as of such date under this Section 4.09, the Issuer
shall be on such date in Default of this Section 4.09).






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          For purposes of determining compliance with any U.S. dollar-denominated restriction on the
Incurrence of Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness denominated
in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on
the date such Indebtedness was Incurred, in the case of term Indebtedness, or first committed, in
the case of revolving credit Indebtedness; provided that if such Indebtedness is Incurred
to refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause
the applicable U.S. dollar denominated restriction to be exceeded if calculated at the relevant
currency exchange rate in effect on the date of such refinancing, such U.S. dollar-denominated
restriction shall be deemed not to have been exceeded so long as the principal amount of such
Refinancing Indebtedness does not exceed the principal amount of such Indebtedness being
refinanced. Notwithstanding any other provision of this Section 4.09, the maximum amount of
Indebtedness that the Issuer or the Restricted Subsidiaries may Incur pursuant to this Section 4.09
shall not be deemed to be exceeded solely as a result of fluctuations in the exchange rate of
currencies. The principal amount of any Indebtedness Incurred to refinance other Indebtedness, if
Incurred in a different currency from the Indebtedness being refinanced, shall be calculated based
on the currency exchange rate applicable to the currencies in which such Refinancing Indebtedness
is denominated that is in effect on the date of such refinancing.



Section 4.10 Asset Sales.




          (a) The Issuer will not, and will not permit any of its Restricted Subsidiaries to, cause,
make or suffer to exist any Asset Sale, unless:





     (1) the Issuer or such Restricted Subsidiary, as the case may be, receives
consideration at least equal to the Fair Market Value (such Fair Market Value to be
determined on the date of contractually agreeing to such Asset Sale) of the shares and
assets subject to such Asset Sale;




     (2) at least 75% of the consideration from such Asset Sale received by the Issuer or
such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents;
and




     (3) an amount equal to 100% of the Net Available Cash from such Asset Sale is applied
by the Issuer or such Restricted Subsidiary, as the case may be, within 365 days from the
later of the date of such Asset Sale or the receipt of such Net Available Cash, as follows:




     (A) to permanently reduce (and permanently reduce commitments with respect
thereto): (i) obligations under the Senior Credit Facility or (ii) Indebtedness of
the Issuer (other than any Disqualified Stock or Subordinated Obligations) that is
secured by a Lien or Indebtedness of a Restricted Subsidiary (other than any
Disqualified Stock or Guarantor Subordinated Obligations) that is secured by a Lien
(in each case other than Indebtedness owed to the Issuer or an Affiliate of the
Issuer);




     (B) to permanently reduce obligations under other Indebtedness of the Issuer
(other than any Disqualified Stock or Subordinated Obligations) or Indebtedness of a
Restricted Subsidiary (other than any Disqualified Stock or Guarantor Subordinated
Obligations) (in each case other than Indebtedness owed to the Issuer or an
Affiliate of the Issuer ); provided that the Issuer shall equally and
ratably reduce Obligations under the Notes as provided under Section 3.07 through
open market purchases or by making an offer (in accordance with the procedures set
forth in this Section 4.10 for an Asset Sale Offer) to all Holders to purchase their
Notes at 100% of the principal amount thereof, plus the amount of accrued but unpaid
interest on the amount of Notes that would otherwise be prepaid; or



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     (C) to invest in Additional Assets;




provided that pending the final application of any such Net Available Cash in
accordance with clause (A), (B) or (C) above, the Issuer and its Restricted Subsidiaries may
temporarily reduce Indebtedness or otherwise invest such Net Available Cash in any manner
not prohibited by this Indenture.



          In the case of clauses (2) and (3) above, a binding commitment shall be treated as a permitted
application of the Net Available Cash from the date of such commitment; provided that
(x) such investment is consummated within 545 days after receipt by the Issuer or any Restricted
Subsidiary of the Net Available Cash of any Asset Sale and (y) if such investment is not
consummated within the period set forth in subclause (x), the Net Proceeds not so applied will be
deemed to be Excess Proceeds (as defined below).





     (4) For the purposes of clauses (2) and (3) above and for no other purpose, the
following will be deemed to be cash:




     (A) any liabilities (as shown on the Issuer’s or such Restricted Subsidiary’s
most recent balance sheet) of the Issuer or any Restricted Subsidiary (other than
liabilities that are by their terms subordinated to the Notes or the Notes
Guarantees) that are assumed by the transferee of any such assets and from which the
Issuer and all Restricted Subsidiaries have been validly released by all creditors
in writing; and




     (B) any securities, notes or other obligations received by the Issuer or any
Restricted Subsidiary from the transferee that are converted by the Issuer or such
Restricted Subsidiary into cash (to the extent of the cash received) within 90 days
following the closing of such Asset Sale.



          (b) Any Net Available Cash from Asset Sales that are not applied or invested as provided in
Section 4.10(a) shall be deemed to constitute “Excess Proceeds.” On the 366th
day after an Asset Sale, if the aggregate amount of Excess Proceeds exceeds $15,000,000, the Issuer
shall be required to make an offer to all Holders and to the extent required by the terms of
outstanding Pari Passu Indebtedness, to all holders of such Pari Passu Indebtedness (an “Asset
Sale Offer”), to purchase the maximum aggregate principal amount of the Notes and any such Pari
Passu Indebtedness that may be purchased out of the Excess Proceeds, at an offer price in cash in
an amount equal to 100% of the principal amount thereof, plus accrued and unpaid interest to the
date of purchase (subject to the right of Holders of record on the relevant Record Date to receive
interest due on the relevant Interest Payment Date) in accordance with the procedures set forth in
Section 3.10 or the agreements governing the Pari Passu Indebtedness, as applicable, in each case
in denominations of $2,000 and integral multiples of $1,000 in excess thereof. The Issuer shall
commence an Asset Sale Offer with respect to Excess Proceeds by mailing (or otherwise communicating
in accordance with the procedures of DTC) the notice required by Section 3.09, with a copy to the
Trustee.




          To the extent that the aggregate amount of Notes and Pari Passu Indebtedness validly tendered
and not properly withdrawn pursuant to an Asset Sale Offer is less than the Excess Proceeds, the
Issuer may use any remaining Excess Proceeds for general corporate purposes, subject to other
covenants contained in this Indenture. If the aggregate principal amount of Notes surrendered by
Holders thereof and other Pari Passu Indebtedness surrendered by holders or lenders, collectively,
exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and Pari Passu
Indebtedness to be purchased on a pro rata basis on the basis of the aggregate accreted value or
principal amount of tendered Notes and Pari Passu Indebtedness. Upon completion of such Asset Sale
Offer, the amount of Excess Proceeds shall be reset at zero.






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          (c) Pending the final application of any Net Available Cash pursuant to this Section 4.10, the
holder of such Net Available Cash may apply such Net Available Cash temporarily to reduce
Indebtedness outstanding under a revolving Credit Facility or otherwise invest such Net Available
Cash in any manner not prohibited by this Indenture.




          (d) The Issuer shall comply, to the extent applicable, with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws or regulations in connection with the
repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any
securities laws or regulations conflict with provisions of this Indenture, the Issuer will comply
with the applicable securities laws and regulations and will not be deemed to have breached its
obligations under this Indenture by virtue of any conflict.



Section 4.11 Transactions with Affiliates.




          (a) The Issuer will not, and will not permit any of its Restricted Subsidiaries to, directly
or indirectly, enter into or conduct any transaction (including the purchase, sale, lease or
exchange of any property or asset or the rendering of any service) with any Affiliate of the Issuer
(an “Affiliate Transaction”) unless:





     (1) the terms of such Affiliate Transaction are not materially less favorable to the
Issuer or such Restricted Subsidiary, as the case may be, than those that could have been
obtained by the Issuer or such Restricted Subsidiary in a comparable transaction at the time
of such transaction in arm’s-length dealings with a Person that is not an Affiliate;




     (2) in the event such Affiliate Transaction involves an aggregate consideration in
excess of $5,000,000, the terms of such transaction have been approved by a majority of the
members of the Board of Directors of the Issuer and by a majority of the members of such
Board of Directors having no personal stake in such transaction, if any (and such majority
or majorities, as the case may be, determines that such Affiliate Transaction satisfies the
criteria in clause (1) above); and




     (3) in the event such Affiliate Transaction involves an aggregate consideration in
excess of $10,000,000, the Issuer has received a written opinion from an Independent
Financial Advisor that such Affiliate Transaction is not materially less favorable than
those that could have been obtained in a comparable transaction at the time of such
transaction in arm’s-length dealings with a Person that is not an Affiliate.




     (b) The provisions of Section 4.11(a) will not apply to:




     (1) (A) transactions between or among the Issuer and any of its Restricted
Subsidiaries, and (B) any merger of the Issuer and any direct parent of the Issuer,
provided, however that such parent shall have not material liabilities and no material
assets other than cash, Cash Equivalents and the Capital Stock of the Issuer and such merger
is otherwise in compliance with the terms of this Indenture and effected for a bona fide
business purpose;




     (2) any Restricted Payment permitted to be made pursuant to Section 4.07 or any
Permitted Investments;




     (3) any issuance of securities, or other payments, awards or grants in cash, securities
or otherwise pursuant to, or the funding of, employment agreements and other compensation
arrangements, options to purchase Capital Stock of the Issuer, restricted stock plans,
long-term incentive plans, stock appreciation rights plans, participation plans or similar
employee benefits



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plans and/or indemnity provided on behalf of Officers and employees approved by the
Board of Directors of the Issuer;




     (4) the payment of reasonable and customary fees and reimbursement of expenses paid to
and indemnity provided on behalf of, directors of the Issuer or any Restricted Subsidiary;




     (5) loans or advances to employees, Officers or directors of the Issuer or Parent or
any Restricted Subsidiary of the Issuer in the ordinary course of business consistent with
past practices, in an aggregate amount not in excess of $5,000,000 with respect to all loans
or advances made since the Issue Date (without giving effect to the forgiveness of any such
loan); provided, however, that the Issuer and Parent and their respective Subsidiaries shall
comply in all material respects with the applicable provisions of the Sarbanes-Oxley Act of
2002 and the rules and regulations promulgated in connection therewith relating to such
loans and advances;




     (6) any agreement as in effect as of the Issue Date, as these agreements may be
amended, modified, supplemented, extended or renewed from time to time, so long as any such
amendment, modification, supplement, extension or renewal is not more disadvantageous to the
Holders in any material respect in the good faith judgment of the senior management of the
Issuer or Board of Directors of the Issuer when taken as a whole than the terms of the
agreements in effect on the Issue Date;




     (7) any agreement between any Person and an Affiliate of such Person existing at the
time such Person is acquired by or merged into the Issuer or a Restricted Subsidiary;
provided, that such agreement was not entered into contemplation of such acquisition
or merger, or any amendment thereto (so long as any such amendment is not disadvantageous to
the Holders in the good faith judgment of the senior management of the Issuer or the Board
of Directors of the Issuer when taken as a whole as compared to the applicable agreement as
in effect on the date of such acquisition or merger);




     (8) transactions with customers, clients, suppliers, joint venture partners or
purchasers or sellers of goods or services (including, without limitation, licensing,
production, co-production, services (e.g., shared services agreements), advertising,
distribution, promotional or delivery agreements), in each case in the ordinary course of
the business of the Issuer and the Restricted Subsidiaries and otherwise in compliance with
the terms of this Indenture; provided that in the reasonable determination of the
members of the Board of Directors or senior management of the Issuer, such transactions are
on terms that are no less favorable to the Issuer or the relevant Restricted Subsidiary than
those that could reasonably have been obtained at the time of such transactions in a
comparable transaction by the Issuer or such Restricted Subsidiary with an unrelated Person;




     (9) any issuance or sale of Capital Stock (other than Disqualified Stock) to Affiliates
of the Issuer and the granting of registration and other customary rights in connection
therewith;




     (10) the entering into of any tax sharing agreement or arrangement and any payments
permitted by Section 4.07;




     (11) any contribution to the capital of the Issuer, or any sale of Capital Stock of the
Issuer (other than Disqualified Stock);




     (12) transactions permitted by, and complying with, the provisions of Section 5.01;




     (13) pledges of Capital Stock of Unrestricted Subsidiaries;



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     (14) any employment agreements entered into by the Issuer or any of its Restricted
Subsidiaries in the ordinary course of business;




     (15) any distribution, license, participation, sale, lease, production, reproduction or
co-financing agreement, guarantee, negative pick-up or other acquisition agreement, or other
similar agreement to any of the foregoing, entered into in the ordinary course of business
and on an arm’s length basis (and if involving more than $5,000,000, is specifically
approved by senior management of the Issuer or a resolution approving such transaction
adopted by the Board of Directors of the Issuer);




     (16) the LGFF Slate Transaction and the Permitted Slate Financing; and




     (17) the sale of revenue participation interests in Product to the Issuer pursuant to
the SGF Co-Financing Arrangement.


Section 4.12 Limitation on Liens.




          The Issuer will not, and will not permit any of the Restricted Subsidiaries to, directly or
indirectly, create, Incur, assume or suffer to exist any Lien (other than Permitted Liens) upon any
of its property or assets (including Capital Stock of Subsidiaries), or income or profits
therefrom, or assign or convey any right to receive income therefrom, whether owned on the Issue
Date or acquired after that date, which Lien is securing any Indebtedness, except:





     (1) Liens pursuant to written security agreements in favor of guilds or unions which
are required in the ordinary course of business pursuant to collective bargaining
agreements;




     (2) Liens to secure distribution, exhibition and/or exploitation rights of licensees
pursuant to Distribution Agreements or of licensors from whom any of the Issuer or the
Restricted Subsidiaries has obtained any distribution rights or other exploitation rights to
any item of Product or Liens to secure production advances on an item of Product, provided
that such Liens are limited to such distribution, exhibition and/or exploitation rights, and
that such production advances are otherwise permitted by this Indenture;




     (3) Liens customarily granted or incurred in the ordinary course of business with
regard to services rendered by laboratories and post-production houses, record warehouses
and suppliers of materials and equipment which secure outstanding trade payables;




     (4) possessory Liens (other than those of laboratories and production houses) which (a)
occur in the ordinary course of business, (b) secure normal trade debt which is not yet due
and payable and (c) do not secure Indebtedness;




     (5) customary Liens in favor of Approved Completion Guarantors granted in connection
with Completion Guaranties;




     (6) Liens granted by the Issuer or any Restricted Subsidiary that is a Special Purpose
Producer to secure outside production financing otherwise permitted under this Indenture;




     (7) Liens granted by SlateCo to secure its obligations in connection with the Permitted
Slate Financing;




     (8) Liens to secure Replication Advances not to exceed $75,000,000 in the aggregate at
any one time outstanding, which may be secured on a subordinated basis and which are



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otherwise on terms and conditions, in the good faith judgment of the Issuer, no less
favorable in any material respect, taken as a whole, to the Issuer as compared to past
similar transactions entered into by the Issuer or its Restricted Subsidiaries; provided
that, the granting of a Lien in respect of the related assets, which is junior in right to
the Lien on such assets which secures the Notes, to secure any such Replication Advances
will not be considered to be less favorable to the Issuer;




     (9) Liens on Acceptable Tax Credits to secure Indebtedness which is non-recourse to the
Issuer or any Restricted Subsidiary other than customary representations and warranties,
which Liens, in the good faith judgment of the Issuer, are no less favorable in any material
respect, taken as a whole, to the Issuer as compared to past similar transactions entered
into by the Issuer or its Restricted Subsidiaries;




     (10) Liens granted by either MQP, any Services Issuer that is the Issuer or any
Restricted Subsidiary, LGF or Lions Gate Television Inc. to secure MQP’s obligations to SGF
pursuant to the SGF Co-Financing Arrangement;




     (11) Liens in connection with reversion or turnaround rights with respect to a project
in development;




     (12) Liens granted by Lions Gate Films Inc. to secure its payment and performance
obligations to FilmCo in connection with the LGFF Slate Transaction;




     (13) Liens granted by one or more of the Issuer and its Restricted Subsidiaries to
secure the obligations of Lions Gate Pennsylvania, Inc., a Pennsylvania corporation, and its
subsidiaries to the lender pursuant to that certain Pennsylvania regional financing
arrangement with Pennsylvania Regional Center, LP I;




     (14) Liens granted by one or more of the Issuer and its Restricted Subsidiaries to
secure Secured Funded Indebtedness permitted to be Incurred under clause (a)(1) under
Section 4.09 or any refinancing of such Indebtedness permitted pursuant to clause (b)(11)
under Section 4.09 in each case, which Liens are either senior to or pari passu in priority
with the Second-Priority Liens pursuant to an Intercreditor Agreement; and




     (15) Liens granted by one or more of the Issuer and its Restricted Subsidiaries to
secure Indebtedness permitted to be Incurred under clause (a)(2) under Section 4.09 or any
refinancing of such Indebtedness permitted pursuant to clause (b)(11) under Section 4.09 in
each case, which Liens are junior in priority to the Second-Priority Liens pursuant to an
Intercreditor Agreement.


Section 4.13 Corporate Existence.




          Subject to Article 5, the Issuer shall do or cause to be done all things necessary to preserve
and keep in full force and effect (1) its corporate existence and the corporate, partnership,
limited liability company, unlimited liability company or other existence of each of its Restricted
Subsidiaries, in accordance with the respective organizational documents (as the same may be
amended from time to time) of the Issuer or any such Restricted Subsidiary and (2) the rights
(charter and statutory), licenses and franchises of the Issuer and its Restricted Subsidiaries;
provided that the Issuer shall not be required to preserve any such right, license or
franchise, or the corporate, partnership, limited liability company or other existence of any of
its Restricted Subsidiaries, if the Issuer in good faith shall determine that the preservation
thereof is no longer desirable in the conduct of the business of the Issuer and its Restricted
Subsidiaries, taken as a whole.






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Section 4.14 Offer to Repurchase Upon Change of Control.




          (a) If a Change of Control occurs, unless the Issuer has exercised its right to redeem all of
the Notes pursuant to Section 3.07, the Issuer will make an offer to purchase all of the Notes (the
“Change of Control Offer”) at a purchase price in cash equal to 101% of the principal
amount of the Notes plus accrued and unpaid interest, if any, to the date of purchase (the
“Change of Control Payment”), subject to the right of Holders of record on the relevant
Record Date to receive interest due on the relevant Interest Payment Date. Within 30 days
following any Change of Control, unless the Issuer has exercised its right to redeem all of the
Notes pursuant to Section 3.07, the Issuer will send notice of such Change of Control Offer by
first-class mail, with a copy to the Trustee, to each Holder to the address of such Holder
appearing in the security register with a copy to the Trustee, or otherwise in accordance with the
procedures of the Depositary, with the following information:





     (1) that a Change of Control Offer is being made pursuant to this Section 4.14 and that
all Notes properly tendered pursuant to such Change of Control Offer will be accepted for
purchase by the Issuer at a purchase price in cash equal to the Change of Control Payment
(subject to the right of Holders of record on the relevant Record Date to receive interest
on the relevant Interest Payment Date);




     (2) the purchase date, which shall be no earlier than 30 days nor later than 60 days
from the date such notice is mailed (the “Change of Control Payment Date”);




     (3) that Notes must be tendered in principal amount of $2,000 or an integral multiple
of $1,000 in excess thereof, and any Note not properly tendered will remain outstanding and
continue to accrue interest;




     (4) that, unless the Issuer defaults in the payment of the Change of Control Payment,
any Note accepted for payment pursuant to the Change of Control Offer will cease to accrue
interest on and after the Change of Control Payment Date;




     (5) that Holders electing to have any Notes purchased pursuant to a Change of Control
Offer will be required to surrender such Notes, with the form entitled “Option of Holder to
Elect Purchase” on the reverse of such Notes completed, to the Paying Agent specified in the
notice at the address specified in the notice prior to the close of business on the third
Business Day preceding the Change of Control Payment Date;




     (6) that Holders shall be entitled to withdraw their tendered Notes and their election
to require the Issuer to purchase such Notes; provided that the Paying Agent
receives at the address specified in the notice, not later than the close of business on the
30th day following the date of the Change of Control notice, a telegram, telex, facsimile
transmission or letter setting forth the name of the Holder of the Notes, the principal
amount of Notes tendered for purchase, and a statement that such Holder is withdrawing its
tendered Notes and its election to have such Notes purchased;




     (7) that if a Holder is tendering less than all of its Notes, such Holder will be
issued new Notes equal in principal amount to the unpurchased portion of the Notes
surrendered; and that the unpurchased portion of the Notes must be equal to $2,000 or an
integral multiple of $1,000 in excess thereof; and




     (8) the other instructions, as determined by the Issuer, consistent with this Section
4.14, that a Holder must follow.




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          The notice, if mailed in a manner herein provided, will be conclusively presumed to have been
given, whether or not the Holder receives such notice. If (A) the notice is mailed in a manner
herein provided and (B) any Holder fails to receive such notice or a Holder receives such notice
but it is defective, such Holder’s failure to receive such notice or such defect shall not affect
the validity of the proceedings for the purchase of the Notes as to all other Holders that properly
received such notice without defect. The Issuer will comply with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws and regulations thereunder to the extent such
laws or regulations are applicable in connection with the repurchase of Notes pursuant to a Change
of Control Offer. To the extent that the provisions of any securities laws or regulations conflict
with the provisions of this Indenture, the Issuer will comply with the applicable securities laws
and regulations and shall not be deemed to have breached its obligations under this Indenture by
virtue thereof.




     (b) On the Change of Control Payment Date, the Issuer will, to the extent lawful:




     (1) accept for payment all Notes or portions of Notes (in integral multiples of $1,000)
properly tendered pursuant to the Change of Control Offer;




     (2) deposit with the Paying Agent an amount equal to the Change of Control Payment in
respect of all Notes or portions of the Notes so tendered; and




     (3) deliver, or cause to be delivered, to the Trustee for cancellation the Notes so
accepted together with an Officers’ Certificate to the Trustee stating aggregate principal
amount of Notes or portions of Notes being purchased by the Issuer in accordance with this
Section 4.14.



          (c) Prior to making a Change of Control Payment, and as a condition to such payment (1) the
requisite holders of each issue of Indebtedness issued under an indenture or other agreement that
may be violated by such payment shall have consented to such Change of Control Payment being made
and waived the event of default, if any, caused by the Change of Control or (2) the Issuer shall
repay all outstanding Indebtedness issued under an indenture or other agreement that may be
violated by a payment to the holders of Notes under a Change of Control Payment or the Issuer shall
offer to repay all such Indebtedness and make payment to the holders of such Indebtedness that
accept such offer and obtain waivers of any event of default arising under the relevant Indenture
or other agreement from the remaining holders of such Indebtedness.



          (d) The Issuer will not be required to make a Change of Control Offer upon a Change of Control
if a third party makes the Change of Control Offer in the manner, at the times and otherwise in
compliance with the requirements set forth in this Section 4.14 applicable to a Change of Control
Offer made by the Issuer and purchases all Notes validly tendered and not withdrawn under such
Change of Control Offer.



          (e) The Issuer will comply, to the extent applicable, with the requirements of Rule 14e-1
under the Exchange Act and any other securities laws or regulations in connection with the
repurchase of Notes pursuant to this Section 4.14. To the extent that the provisions of any
securities laws or regulations conflict with provisions of this Indenture, the Issuer will comply
with the applicable securities laws and regulations and will not be deemed to have breached its
obligations described in this Indenture by virtue of the conflict.



          (f) Other than as specifically provided in this Section 4.14, any purchase pursuant to this
Section 4.14 shall be made pursuant to the provisions of Sections 3.02, 3.05 and 3.06.



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Section 4.15 Limitation on Sale of Capital Stock of Restricted Subsidiaries.




          (a) The Issuer will not, and will not permit any Restricted Subsidiary to transfer, convey,
sell, lease or otherwise dispose of any Voting Stock of any Restricted Subsidiary or, with respect
to a Restricted Subsidiary, to issue any of the Voting Stock of a Restricted Subsidiary (other
than, if necessary, shares of its Voting Stock constituting directors’ qualifying shares) to any
Person except:




     (1) to the Issuer or a Wholly Owned Subsidiary; or




     (2) in compliance with Section 4.10 and immediately after giving effect to such
issuance or sale, such Restricted Subsidiary would continue to be a Restricted Subsidiary.


Notwithstanding the foregoing, the Issuer and the Restricted Subsidiaries may sell all the Voting
Stock of a Restricted Subsidiary as long as the Issuer or the Restricted Subsidiaries comply with
the terms of Section 4.10. In that case, such Restricted Subsidiary, if a Guarantor, will be
automatically released from all its obligations under this Indenture, its Guarantee, the Collateral
Documents and any applicable Intercreditor Agreement, and the Liens, if any, on the Collateral
pledged by such Guarantor pursuant to the Collateral Documents shall be released with respect to
the Notes if all the obligations of such Guarantor under its Guarantee under the Senior Credit
Facility and the Existing Convertible Notes and related documentation and any other agreements
relating to any other Indebtedness of Parent, the Issuer or the Restricted Subsidiaries terminate
upon consummation of such sale.



Section 4.16 Limitation on Sale/Leaseback Transactions.




          The Issuer will not, and will not permit any of its Restricted Subsidiaries to, enter into any
Sale/Leaseback Transaction unless:



          (a) the Issuer or such Restricted Subsidiary, as the case may be, receives consideration at
the time of such Sale/Leaseback Transaction at least equal to the Fair Market Value (as evidenced
by a resolution of the Board of Directors of the Issuer) of the property subject to such
transaction;



          (b) the Issuer or such Restricted Subsidiary could have Incurred Indebtedness in an amount
equal to the Attributable Indebtedness in respect of such Sale/Leaseback Transaction pursuant to
Section 4.09;



          (c) the Issuer or such Restricted Subsidiary would be permitted to create a Lien on the
property subject to such Sale/Leaseback Transaction under Section 4.12; and



          (d) to the extent the Sale/Leaseback Transaction is treated as an Asset Sale, all of the
conditions described under Section 4.10 (including the provisions concerning the application of Net
Available Cash) are satisfied with respect to such Sale/Leaseback Transaction, treating all of the
consideration received in such Sale/Leaseback Transaction as Net Available Cash for purposes of
Section 4.10.


Section 4.17 Additional Subsidiary Guarantees.




          (a) The Issuer will cause each Restricted Subsidiary that Guarantees on the Issue Date or any
time thereafter any Indebtedness of the Issuer or any Guarantor, if such Restricted Subsidiary is
not a Guarantor under this Indenture, to:



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     (1) execute and deliver a supplemental indenture to this Indenture, the form of which
is attached as Exhibit C, pursuant to which such Restricted Subsidiary will agree to be a
Guarantor under this Indenture and be bound by the terms of this Indenture applicable to
Guarantors, including, but not limited to, Article 11; provided that if the
supplemental indenture is not in the form of Exhibit C, such Guarantor shall deliver to the
Trustee an Opinion of Counsel (such opinion or portions thereof may be in form and substance
substantially similar to the Opinion of Counsel delivered on the Issue Date) to the effect
that:




     (A) such Notes Guarantee has been duly executed and authorized; and




     (B) such Notes Guarantee constitutes a valid, binding and enforceable
obligation of such Restricted Subsidiary, except insofar as enforcement thereof may
be limited by bankruptcy, insolvency or similar laws (including, without limitation,
all laws relating to fraudulent transfers) and except insofar as enforcement thereof
is subject to general principles of equity; and




     (2) waive and not in any manner whatsoever claim or take the benefit or advantage of,
any rights of reimbursement, indemnity or subrogation or any other rights against the Issuer
or any other Restricted Subsidiary as a result of any payment by such Restricted Subsidiary
under its Notes Guarantee.



          (b) Parent will cause each of its first-tier Subsidiaries that Guarantees on the Issue Date or
any time thereafter any Indebtedness of the Issuer or any Guarantor, if such Subsidiary is not a
Guarantor under this Indenture, to:




     (1) execute and deliver to the Trustee a supplemental indenture to this Indenture
pursuant to which such Subsidiary will agree to be a Guarantor under this Indenture and be
bound by the terms of this Indenture applicable to Guarantors, including, but not limited
to, Article 11; provided that if the supplemental indenture is not in the form of
Exhibit C, such Guarantor shall deliver to the Trustee an Opinion of Counsel (such opinion
or portions thereof may be in form and substance substantially similar to the Opinion of
Counsel delivered on the Issue Date) to the effect that:




     (A) such Notes Guarantee has been duly executed and authorized; and




     (B) such Notes Guarantee constitutes a valid, binding and enforceable
obligation of such Restricted Subsidiary, except insofar as enforcement thereof may
be limited by bankruptcy, insolvency or similar laws (including, without limitation,
all laws relating to fraudulent transfers) and except insofar as enforcement thereof
is subject to general principles of equity; and




     (2) waive and not in any manner whatsoever claim or take the benefit or advantage of,
any rights of reimbursement, indemnity or subrogation or any other rights against the Issuer
or any other Restricted Subsidiary as a result of any payment by such Restricted Subsidiary
under its Notes Guarantee.



          (c) In addition, the Issuer and Parent shall cause such Subsidiary to become a party to the
applicable Collateral Documents and any applicable Intercreditor Agreement and take such actions
necessary or advisable to grant to the Collateral Agent, for the benefit of itself and the holders
of the Notes, a perfected security interest in any Collateral held by such Subsidiary, subject to
Permitted Liens.



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Section 4.18 Maintenance of Properties and Insurance.




          (a) The Issuer will cause all properties used or useful in the conduct of its business or the
business of any of its Restricted Subsidiaries to be maintained and kept in good condition, repair
and working order as in the judgment of the Issuer may be necessary so that the business of the
Issuer and its Restricted Subsidiaries may be properly conducted at all times; provided
that nothing in this Section 4.18 prevents the Issuer or any Restricted Subsidiary from
discontinuing the use, operation or maintenance of any of such properties or disposing of any of
them, if such discontinuance or disposal (1)(A) is, in the judgment of the Issuer, desirable in the
conduct of the business of the Issuer and its Restricted Subsidiaries taken as a whole or (B) would
not have a material adverse effect on the ability of the Issuer and the Guarantors taken as a whole
to satisfy their Obligations under the Notes or this Indenture and, to the extent applicable (2) is
not otherwise prohibited by this Article 4.



          (b) The Issuer will provide or cause to be provided, for itself and its Restricted
Subsidiaries, insurance (including appropriate self-insurance) against loss or damage of the kinds
that, in the good faith opinion of the Board of Directors of the Issuer, is adequate and
appropriate for the conduct of the business of the Issuer and its Restricted Subsidiaries.


Section 4.19 Further Assurances; Collateral Inspections.




          (a) The Issuer and each of the Guarantors will make, execute, endorse, acknowledge, file,
record, register and/or deliver such agreements, documents, instruments, and further assurances
(including, without limitation, Uniform Commercial Code and PPSA financing statements, mortgages,
hypothecs, deeds of trust, vouchers, invoices, schedules, confirmatory assignments, conveyances,
transfer endorsements, powers of attorney, certificates, real property surveys, reports, landlord
waivers, bailee agreements and control agreements), and take such other actions, as may be required
under applicable law or as the Trustee or the Collateral Agent may deem reasonably appropriate or
advisable to cause the Collateral Requirement to be and remain satisfied and otherwise to create,
perfect, preserve or protect the security interest in the Collateral of the secured parties under
the Collateral Documents, all at the Issuer’s expense.



          (b) Upon written request of the Trustee or the Collateral Agent at any time after an Event of
Default has occurred and is continuing, the Issuer and each Guarantor, subject to such party
entering into a reasonable and customary confidentiality agreement with the Issuer or the
applicable Guarantor, permit the Trustee or the Collateral Agent or any advisor, auditor,
consultant, attorney or representative acting for the Trustee or the Collateral Agent, upon
reasonable notice to the Issuer and during normal business hours, to visit and inspect any of the
property of the Issuer and each Guarantor, to review, make extracts from and copy the books and
records of the Issuer and the Guarantors relating to any such property, and to discuss any matter
pertaining to any such property with the officers and employees of the Issuer and the Guarantors.


Section 4.20 Effectiveness of Covenants.





     (a) Following the first day:




     (1) the Notes have an Investment Grade Rating from both of the Rating Agencies; and




     (2) no Default has occurred and is continuing under this Indenture,


the Issuer and its Restricted Subsidiaries will not be subject to the provisions of Sections 4.07,
4.08, 4.09, 4.10, 4.11, 4.15 and Section 5.01(a)(4) (collectively, the “Suspended
Covenants”).







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          (b) If at any time the Notes’ credit rating is downgraded from an Investment Grade Rating by
any Rating Agency or if a Default or Event of Default occurs and is continuing, then the Suspended
Covenants will thereafter be reinstated as if such covenants had never been suspended (the
“Reinstatement Date”) and be applicable pursuant to the terms of this Indenture (including
in connection with performing any calculation or assessment to determine compliance with the terms
of this Indenture), unless and until the Notes subsequently attain an Investment Grade Rating and
no Default or Event of Default is in existence (in which event the Suspended Covenants shall no
longer be in effect for such time that the Notes maintain an Investment Grade Rating and no Default
or Event of Default is in existence); provided, however, that no Default, Event of
Default or breach of any kind shall be deemed to exist under this Indenture, the Notes or the Notes
Guarantees with respect to the Suspended Covenants based on, and none of the Issuer or any of its
Subsidiaries or Parent shall bear any liability for, any actions taken or events occurring during
the Suspension Period (as defined below), or any actions taken at any time pursuant to any
contractual obligation arising prior to the Reinstatement Date, regardless of whether such actions
or events would have been permitted if the applicable Suspended Covenants remained in effect during
such period. The period of time between the date of suspension of the covenants and the
Reinstatement Date is referred to as the “Suspension Period.”



          (c) On the Reinstatement Date, all Indebtedness Incurred during the Suspension Period will be
classified to have been Incurred pursuant to Section 4.09(a) or one of the clauses set forth in
Section 4.09(b) (to the extent such Indebtedness would be permitted to be Incurred thereunder as of
the Reinstatement Date and after giving effect to Indebtedness Incurred prior to the Suspension
Period and outstanding on the Reinstatement Date). To the extent such Indebtedness would not be so
permitted to be Incurred pursuant to Section 4.09(a) or (b) such Indebtedness will be deemed to
have been outstanding on the Issue Date, so that it is classified as permitted under clause (2) of
Section 4.09(b). Calculations made after the Reinstatement Date of the amount available to be made
as Restricted Payments under Section 4.07 will be made as though Section 4.07 had been in effect
since the Issue Date and throughout the Suspension Period. Accordingly, Restricted Payments made
during the Suspension Period will reduce the amount available to be made as Restricted Payments
under Section 4.09(a).



          (d) During any period when the Suspended Covenants are suspended, the Board of Directors of
the Issuer may not designate any of the Issuer’s Subsidiaries as Unrestricted Subsidiaries pursuant
to this Indenture.



ARTICLE 5




SUCCESSORS


Section 5.01 Merger, Consolidation or Sale of All or Substantially All Assets.




          (a) The Issuer will not consolidate with or merge with or into, or convey, transfer or lease
all or substantially all of its assets to any Person, unless:




     (1) the Issuer is the surviving person or the resulting surviving or transferee Person
(the “Successor Company”) is a corporation organized and existing under the laws of
the United States of America, any State of the United States, or the District of Columbia;




     (2) the Successor Issuer (if not the Issuer) will expressly assume, by supplemental
indenture, executed and delivered to the Trustee, in form satisfactory to the Trustee, all
the obligations of the Issuer under the Notes and this Indenture and the Collateral
Documents (as applicable) and the Intercreditor Agreement and shall cause such amendments,
supplements or other instruments to be executed, filed, and recorded in such jurisdictions
as may be required by applicable law to preserve and protect the Lien on the Collateral
owned by or transferred to the



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Successor Company, together with such financing statements or comparable documents as
may be required to perfect any security interests in such Collateral which may be perfected
by the filing of a financing statement or a similar document under the Uniform Commercial
Code or other similar statute or regulation of the relevant states or jurisdictions;




     (3) immediately after giving effect to such transaction (and treating any Indebtedness
that becomes an obligation of the Successor Company or any Subsidiary of the Successor
Company as a result of such transaction as having been Incurred by the Successor Company or
such Subsidiary at the time of such transaction), no Default or Event of Default shall have
occurred and be continuing;




     (4) immediately after giving pro forma effect to such transaction and any related
financing transactions, as if such transactions had occurred at the beginning of the
applicable four-quarter period, the Issuer (including any Successor Company) would be able
to Incur at least $1.00 of additional Indebtedness pursuant to Section 4.09(a)(2).




     (5) each Guarantor (unless it is the other party to the transactions above, in which
case clause (1)(B) of Section 5.01(c) shall apply) shall have by supplemental indenture
confirmed that its Notes Guarantee shall apply to such Person’s obligations in respect of
this Indenture and the Notes and shall have by written agreement confirmed that its
obligations under the Collateral Documents and the Intercreditor Agreements shall continue
to be in effect and shall cause such amendments, supplements or other instruments to be
executed, filed, and recorded in such jurisdictions as may be required by applicable law to
preserve and protect the Lien on the Collateral owned by such Guarantor, together with such
financing statements or comparable documents as may be required to perfect any security
interests in such Collateral which may be perfected by the filing of a financing statement
or a similar document under the Uniform Commercial Code or other similar statute or
regulation of the relevant states or jurisdictions; and




     (6) the Issuer shall have delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel, each stating that such consolidation, merger, winding up or disposition
and such supplemental indenture (if any) comply with this Indenture and the Collateral
Documents.




     (b) Notwithstanding clauses (3) and (4) of Section 5.01(a):




     (1) any Restricted Subsidiary may consolidate with, merge with or into or transfer all
or part of its properties and assets to the Issuer so long as no Capital Stock of the
Restricted Subsidiary is distributed to any Person other than the Issuer or other Restricted
Subsidiary; and




     (2) the Issuer may merge with an Affiliate of the Issuer solely for the purpose of
reincorporating the Issuer in another state or territory of the United States or the
District of Columbia to realize tax benefits, so long as the amount of Indebtedness of the
Issuer and its Restricted Subsidiaries is not increased thereby;
provided that, in the case
of a Restricted Subsidiary that merges into the Issuer, the Issuer will not be required to
comply with Section 5.01(a)(6).



          (c) The Issuer will not permit any LGEI Subsidiary Guarantor to consolidate with or merge with
or into or wind up into (whether or not the Issuer or the Guarantor is the surviving corporation),
or sell, assign, convey, transfer, lease, convey or otherwise dispose of all or substantially all
of its properties and assets any Person (other than to the Issuer or another LGEI Subsidiary
Guarantor) unless:



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     (1) (A) if such entity remains an LGEI Subsidiary Guarantor, the resulting, surviving
or transferee Person (the “Successor Guarantor”) will be a corporation, partnership,
trust or limited liability company organized and existing under the laws of the United
States of America, any State of the United States or the District of Columbia and shall
assume by written agreement all the obligations of such Guarantor under the Collateral
Documents (as applicable) and the Intercreditor Agreements and shall cause such amendments,
supplements or other instruments to be executed, filed and recorded in such jurisdictions as
may be required by applicable law to preserve and protect the Lien on the Collateral pledged
by or transferred to the surviving entity, together with such financing statements or
comparable documents as may be required to perfect any security interest in such Collateral
which may be perfected by the filing of a financing statement or similar document under the
Uniform Commercial Code or other similar statute or regulation of the relevant states or
jurisdictions in each case in a form reasonably satisfactory to the Trustee;




     (B) the Successor Guarantor, if other than such Guarantor, expressly assumes
all the obligations of such Guarantor under the Notes, this Indenture and its LGEI
Subsidiary Guarantee pursuant to a supplemental indenture or other documents or
instruments in form and substance reasonably satisfactory to the Trustee;




     (C) immediately after giving effect to such transaction (and treating any
Indebtedness that becomes an obligation of the resulting, surviving or transferee
Person or any Restricted Subsidiary as a result of such transaction as having been
Incurred by such Person or such Restricted Subsidiary at the time of such
transaction), no Default or Event of Default shall have occurred and be continuing;
and




     (D) the Issuer will have delivered to the Trustee an Officers’ Certificate and
an Opinion of Counsel, each stating that such consolidation, merger, winding up or
disposition and such supplemental indenture (if any) comply with this Indenture; and




     (2) the transaction is made in compliance with Section 4.10 (it being understood that
only such portion of the Net Available Cash as is required to be applied on the date of such
transaction in accordance with the terms of this Indenture needs to be applied in accordance
therewith at such time), Section 4.15 and this Section 5.01.



          (d) Except as otherwise described in this Indenture, the Successor Guarantor shall succeed to,
and be substituted for, such Guarantor under this Indenture and the Guarantee of such Guarantor.
Notwithstanding the foregoing, any Guarantor may merge with or into or transfer all or part of its
properties and assets to another Guarantor or the Issuer or merge with a Restricted Subsidiary of
the Issuer solely for the purpose of reincorporating the Guarantor in a State of the United States
or the District of Columbia, as long as the amount of Indebtedness of such Guarantor and its
Restricted Subsidiaries is not increased thereby.



          (e) Parent will not, and will not permit any other Parent Subsidiary Guarantor to, consolidate
with, amalgamate or merge with or into, or convey, transfer or lease all or substantially all its
assets to, any Person, unless:




     (1) Parent or such other Parent Subsidiary Guarantor, as applicable, is the surviving
person or the resulting, surviving or transferee Person (the “Successor Parent
Entity”) will be a corporation organized and existing under the laws of Canada, any
Province of Canada, the United States of America, any State of the United States or the
District of Columbia;



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     (2) the Successor Parent Entity (if not Parent) will expressly assume, by supplemental
indenture, executed and delivered to the Trustee, in form satisfactory to the Trustee, all
the obligations of Parent under the Notes and this Indenture and the Collateral Documents
(as applicable) and the Intercreditor Agreements and shall cause such amendments,
supplements or other instruments to be executed, filed, and recorded in such jurisdictions
as may be required by applicable law to preserve and protect the Lien on the Collateral
owned by or transferred to the Successor Parent Entity, together with such financing
statements or comparable documents as may be required to perfect any security interests in
such Collateral which may be perfected by the filing of a financing statement or a similar
document under the Personal Property Security Act, the Uniform Commercial Code or other
similar statute or regulation of the relevant states or jurisdictions;




     (3) immediately after giving effect to such transaction (and treating any Indebtedness
that becomes an obligation of the Successor Parent Entity or any Subsidiary of the Successor
Parent Entity as a result of such transaction as having been Incurred by the Successor
Parent Entity or such Subsidiary at the time of such transaction), no Default or Event of
Default shall have occurred and be continuing; and




     (4) Parent or such other Parent Subsidiary Guarantor, as applicable, shall have
delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating
that such consolidation, merger, winding up or disposition and such supplemental indenture
(if any) comply with this Indenture and the Collateral Documents.



          (f) For purposes of this Section 5.01, the sale, assignment, transfer, lease, conveyance or
other disposition of all or substantially all of the properties and assets of one or more
Subsidiaries of Parent or the Issuer, in a single transaction or series of related transactions,
which properties and assets, if held by Parent or the Issuer instead of such Subsidiaries, would
constitute all or substantially all of the properties and assets of Parent or the Issuer on a
consolidated basis, shall be deemed to be the disposition of all or substantially all of the
properties and assets of Parent or the Issuer, as applicable.



          (g) The Issuer and a Guarantor, as the case may be, will be released from its obligations
under this Indenture and its Notes Guarantee, as the case may be, and the Successor Company,
Successor Guarantor or Successor Parent Entity, as the case may be, will succeed to, and be
substituted for, and may exercise every right and power of, the Issuer or a Guarantor, as the case
may be, under this Indenture, such Notes Guarantee and the Collateral Documents; provided that, in
the case of a lease of all or substantially all its assets, the Issuer will not be released from
the obligation to pay the principal of and interest on the Notes and a Guarantor will not be
released from its obligations under its Notes Guarantee.


Section 5.02 Successor Entity Substituted.




          Upon any consolidation, amalgamation or merger, or conveyance, transfer or lease all or
substantially all of the assets of the Issuer to any Person in accordance with Section 5.01, the
successor Person, formed by such consolidation or into or with which the Issuer or a Guarantor as
applicable, is consolidated, amalgamated or merged or to which conveyance, transfer, or lease is
made shall succeed to, and be substituted for (so that from and after the date of such
consolidation, amalgamation, merger, conveyance, transfer, or lease, the provisions of this
Indenture referring to the Issuer or such Guarantor, as applicable, shall refer instead to the
successor entity and not to the Issuer or such Guarantor, as applicable), and may exercise every
right and power of the Issuer or such Guarantor, as applicable, under this Indenture with the same
effect as if such successor Person had been named as the Issuer or such Guarantor, as applicable,
herein; provided that the predecessor Issuer shall not be relieved from the obligation to
pay the principal of premium, if any, and interest on the Notes except in the case of a sale,



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assignment, transfer, conveyance or other disposition of all of the Issuer’s assets that meets
the requirements of Section 5.01.




ARTICLE 6




DEFAULTS AND REMEDIES


Section 6.01 Events of Default.




          (a) An “Event of Default” wherever used herein, means any one of the following events
(whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or
be effected by operation of law or pursuant to any judgment, decree or order of any court or any
order, rule or regulation of any administrative or governmental body):




     (1) default in any payment of interest on any Note when due, for a period of 30 days;




     (2) default in the payment of principal of or premium, if any, on any Note when due at
its Stated Maturity, upon optional redemption, upon required repurchase, upon declaration or
otherwise;




     (3) (A) failure by the Issuer, Parent or any other Guarantor with a fair market value
of $1,000,000 or more to comply with its obligations under Section 5.01 and (B) failure by
any Guarantor with a fair market value of less than $1,000,000 to comply for 15 days after
notice of its failure to comply with its obligations under Section 5.01;




     (4) (A) failure by the Issuer to comply for 30 days after notice as provided below with
any of its obligations under Article 4 (in each case, other than (i) a failure to purchase
Notes which constitutes an Event of Default under clause (2) above, (ii) a failure to comply
with Section 5.01 which constitutes an Event of Default under clause (3) above or (iii) a
failure to comply with any of Section 4.03 which constitutes an Event of Default under
clause (5) below) or (B) failure by the Issuer or any Guarantor to comply for 30 days after
notice as provided below with any of its obligations under the Collateral Documents or the
Intercreditor Agreements;




     (5) failure by the Issuer, Parent or any other Guarantor to comply for 60 days after
notice as provided below with any of its other agreements contained in this Indenture, the
Notes, the Notes Guarantees or the Collateral Documents;




     (6) default under any mortgage, indenture or instrument under which there may be issued
or by which there may be secured or evidenced any indebtedness for money borrowed by any
Guarantor or the Issuer or any of the Restricted Subsidiaries (or the payment of which is
guaranteed by any Guarantor or the Issuer or any of the Restricted Subsidiaries), other than
Indebtedness owed to any Guarantor or the Issuer or a Restricted Subsidiary, whether such
indebtedness or guarantee now exists, or is created after the Issue Date, which default:




     (A) is caused by a failure to pay principal of such indebtedness prior to the
expiration of the final maturity date provided in such indebtedness unless such
indebtedness is discharged (“payment default”); or




     (B) results in the acceleration of such indebtedness prior to its maturity;




and, in each case, the principal amount of any such indebtedness, together with the
principal amount of any other such indebtedness under which there has been a payment default
or the



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maturity of which has been so accelerated, aggregates $15,000,000 or its foreign equivalent
or more; provided, however, that in the case of a default of Indebtedness incurred by a
Special Purpose Producer that is non-recourse to the Issuer or any Restricted Subsidiary
other than such Special Purpose Producer, there shall be no Event of Default hereunder
unless such default continues unremedied for 10 Business Days;




     (7) Parent, the Company, any Restricted Subsidiary that is a Significant Subsidiary or
any group of Restricted Subsidiaries that, taken together (as of the date of the latest
audited consolidated financial statements of Parent, the Company and the Restricted
Subsidiaries), would constitute a Significant Subsidiary, pursuant to or within the meaning
of any Bankruptcy Law:




     (A) commences proceedings to be adjudicated bankrupt or insolvent;




     (B) consents to the institution of bankruptcy or insolvency proceedings against
it, or the filing by it of a petition or answer or consent seeking an arrangement of
debt, reorganization, dissolution, winding up or relief under applicable Bankruptcy
Law (including, for the avoidance of doubt, the filing of a notice of intention
under the Bankruptcy and Insolvency Act (Canada) or of an application under the
Companies’ Creditors Arrangement Act (Canada) or any proposal to compromise, arrange
or reorganize any of its debts or obligations under Section 192 of the Canada
Business Corporations Act or any similar provision of Canadian federal or provincial
corporate law);




     (C) consents to the appointment of a receiver, interim receiver, receiver and
manager, liquidator, assignee, trustee, sequestrator or other similar official of it
or for all or substantially all of its property; or




     (D) makes a general assignment for the benefit of its creditors;




     (8) a court of competent jurisdiction enters an order or decree under any Bankruptcy
Law that:




     (A) is for relief against Parent, the Company, any Restricted Subsidiary that
is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken
together (as of the date of the most recent audited consolidated financial
statements of Parent, the Company and the Restricted Subsidiaries), would constitute
a Significant Subsidiary, in a proceeding in which Parent, the Company, any such
Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted
Subsidiaries that, taken together (as of the date of the latest audited consolidated
financial statements of Parent, the Company and the Restricted Subsidiaries), would
constitute a Significant Subsidiary, is to be adjudicated bankrupt or insolvent;




     (B) appoints a receiver, interim receiver, receiver and manager, liquidator,
assignee, trustee, sequestrator or other similar official of Parent, the Company,
any Restricted Subsidiary that is a Significant Subsidiary or any group of
Restricted Subsidiaries that, taken together (as of the date of the latest audited
consolidated financial statements of Parent, the Company and the Restricted
Subsidiaries), would constitute a Significant Subsidiary, or for all or
substantially all of the property of Parent, the Company, any Restricted Subsidiary
that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken
together (as of the date of the latest audited consolidated financial statements of
Parent, the Company and the Restricted Subsidiaries), would constitute a Significant
Subsidiary;



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     (C) orders the liquidation, dissolution or winding up of Parent, the Company,
or any Restricted Subsidiary that is a Significant Subsidiary or any group of
Subsidiaries that, taken together (as of the date of the latest audited consolidated
financial statements of Parent, the Company and the Restricted Subsidiaries), would
constitute a Significant Subsidiary; or




     (D) orders the presentation of any plan or arrangement, compromise or
reorganization of the Parent, the Company, any Restricted Subsidiary that is a
Significant Subsidiary or any group of Restricted Subsidiaries that, taken together
(as of the date of the latest audited consolidated financial statements of Parent,
the Company and the Restricted Subsidiaries), would constitute a Significant
Subsidiary;




and the order or decree remains unstayed and in effect for 60 consecutive days; or;




     (9) failure by Parent, the Issuer or any Significant Subsidiary or group of Restricted
Subsidiaries that, taken together (as of the latest audited consolidated financial
statements for Parent, the Issuer and the Restricted Subsidiaries), would constitute a
Significant Subsidiary to pay final judgments aggregating in excess of $15,000,000 or its
foreign equivalent (net of any amounts that a reputable and creditworthy insurance Issuer
has acknowledged liability for in writing), which judgments are not paid, discharged or
stayed for a period of 60 days; or




     (10) any Notes Guarantee ceases to be in full force and effect (except as contemplated
by the terms of this Indenture and the Notes Guarantees) or is declared null and void in a
judicial proceeding or any Guarantor denies or disaffirms its obligations under this
Indenture or its Notes Guarantee to which it is a party and the Issuer fails to cause such
Guarantor to rescind such denials or disaffirmations within 30 days; or




     (11) the Liens created by the Collateral Documents shall at any time not constitute a
valid and perfected Lien on any portion of the Collateral with a fair market value or book
value equal to or more than $2,000,000 intended to be covered thereby (to the extent
perfection by filing, registration, recordation or possession is required by this Indenture
or the Collateral Documents) other than in accordance with the terms of the relevant
Collateral Documents and this Indenture and other than the satisfaction in full of all
obligations of the Issuer and the Guarantors under this Indenture or the release or
amendment of any such Lien in accordance with the terms of this Indenture or the Collateral
Documents, or, except for expiration in accordance with its terms or amendment,
modification, waiver, termination or release in accordance with the terms of this Indenture
and the relevant Collateral Documents, any of the Collateral Documents shall for whatever
reason be terminated or cease to be in full force and effect, if in either case, such
Default continues for 30 days after notice, or the enforceability thereof shall be contested
by the Issuer or any Guarantor.


However, a default under clauses (4) and (5) of this Section 6.01(a) will not constitute an Event
of Default until the Trustee or the Holders of at least 25% in principal amount of the outstanding
Notes notify the Issuer of the default in writing and the Issuer does not cure such default within
the time specified in clauses (4) and (5) of this Section 6.01(a) after receipt of such notice.




          (b) In the event of a declaration of acceleration of the Notes because an Event of Default
described in clause (6) of Section 5.01(a) has occurred and is continuing, the declaration of
acceleration of the Notes shall be automatically annulled if:




     (1) the default triggering such Event of Default pursuant to clause (6) of Section
5.01(a) shall be remedied or cured by the Parent, Issuer or a Restricted Subsidiary or
waived by



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the holders of the relevant Indebtedness within 20 days after the declaration of
acceleration with respect thereto; and




     (2) (A) the annulment of the acceleration of the Notes would not conflict with any
judgment or decree of a court of competent jurisdiction and (B) all existing Events of
Default, except nonpayment of principal, premium or interest on the Notes that became due
solely because of the acceleration of the Notes, have been cured or waived.


Section 6.02 Acceleration.




          (a) If any Event of Default (other an Event of Default described in clause (7) or (8) of
Section 6.01(a)) occurs and is continuing under this Indenture, the Trustee by written notice to
the Issuer, specifying the Event of Default, may or the Holders of at least 25% in principal amount
of the outstanding Notes by notice to the Issuer and the Trustee may, and the Trustee at the
request of such Holders shall, declare the principal of, premium, if any, and interest that is both
accrued and unpaid, if any, on all the Notes to be due and payable immediately. Upon such a
declaration, such principal, premium, if any, and interest that is both accrued and unpaid shall be
due and payable immediately.



          (b) If an Event of Default described in clause (7) or (8) of Section 6.01(a) occurs and is
continuing, the principal of, premium, if any, and interest that is both accrued and unpaid on all
the Notes will become and be immediately due and payable without any declaration or other act on
the part of the Trustee or any Holders.



          (c) The Holders of a majority in principal amount of the outstanding Notes may waive all past
defaults (except with respect to nonpayment of principal, premium or interest) and rescind any such
acceleration with respect to the Notes and its consequences if (1) rescission would not conflict
with any judgment or decree of a court of competent jurisdiction and (2) all existing Events of
Default, other than the nonpayment of the principal of, premium, if any, and interest on the Notes
that have become due solely by such declaration of acceleration, have been cured or waived.


Section 6.03 Other Remedies.




          (a) If an Event of Default occurs and is continuing, the Trustee may pursue any available
remedy to collect the payment of principal of and premium, if any, and interest on the Notes or to
enforce the performance of any provision of the Notes or this Indenture.



          (b) The Trustee may maintain a proceeding even if it does not possess any of the Notes or does
not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder of a
Note in exercising any right or remedy accruing upon an Event of Default shall not impair the right
or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.


Section 6.04 Waiver of Past Defaults.




          The Holders of a majority in aggregate principal amount of the then outstanding Notes by
written notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing
Default and its consequences hereunder, except:




     (1) a continuing Default in the payment of the principal of, premium, if any, or
interest on, any Note held by a non-consenting Holder (including in connection with an Asset
Sale Offer or a Change of Control Offer); and



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     (2) a Default with respect to a provision that under Section 9.02 cannot be amended
without the consent of each Holder affected,


provided, subject to Section 6.02, that the Holders of a majority in aggregate principal
amount of the then outstanding Notes may rescind an acceleration and its consequences, including
any related payment default that resulted from such acceleration. Upon any such waiver, such
Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Indenture; but no such waiver shall extend to any subsequent
or other Default or impair any right consequent thereon.



Section 6.05 Control by Majority.




          The Holders of a majority in principal amount of the outstanding Notes are given the right to
direct the time, method and place of conducting any proceeding for any remedy available to the
Trustee or of exercising any trust or power conferred on the Trustee. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture or that the Trustee
determines in good faith is unduly prejudicial to the rights of any other Holder or that would
involve the Trustee in personal liability or expense for which the Trustee has not received an
indemnity reasonably satisfactory to it.


Section 6.06 Limitation on Suits.




          Subject to Section 6.07, no Holder may pursue any remedy with respect to this Indenture or the
Notes unless:




     (1) such Holder has previously given the Trustee notice that an Event of Default is
continuing;




     (2) the Holders of at least 25% in principal amount of the then outstanding Notes have
requested the Trustee to pursue the remedy;




     (3) such Holders have offered the Trustee security or indemnity reasonably satisfactory
to the Trustee against any loss, liability or expense;




     (4) the Trustee has not complied with such request within 60 days after the receipt of
the request and the offer of security or indemnity; and




     (5) the Holders of a majority in principal amount of the outstanding Notes have not
given the Trustee a direction that, in the opinion of the Trustee, is inconsistent with such
request within such 60-day period.


A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a
preference or priority over another Holder.



Section 6.07 Rights of Holders to Receive Payment.




          Notwithstanding any other provision of this Indenture, the right of any Holder to receive
payment of principal of and premium, if any, and interest on its Note, on or after the respective
due dates expressed in such Note (including in connection with an Asset Sale Offer or a Change of
Control Offer), or to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such Holder.



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Section 6.08 Collection Suit by Trustee.




          If an Event of Default specified in Section 6.01(a)(1) or (2) occurs and is continuing, the
Trustee may recover judgment in its own name and as trustee of an express trust against the Issuer
for the whole amount of principal of and premium, if any, and interest remaining unpaid to but not
including the date of payment on the Notes, together with interest on overdue principal and, to the
extent lawful, interest and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses, disbursements and advances
of the Trustee and its agents and counsel.


Section 6.09 Restoration of Rights and Remedies.




          If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy
under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has
been determined adversely to the Trustee or to such Holder, then and in every such case, subject to
any determination in such proceedings, the Issuer, the Guarantors, the Trustee and the Holders
shall be restored severally and respectively to their former positions hereunder and thereafter all
rights and remedies of the Trustee and the Holders shall continue as though no such proceeding has
been instituted.


Section 6.10 Rights and Remedies Cumulative.




          Except as otherwise provided with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Notes in Section 2.07, no right or remedy herein conferred upon or
reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy,
and every right and remedy are, to the extent permitted by law, cumulative and in addition to every
other right and remedy given hereunder or now or hereafter existing at law or in equity or
otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not
prevent the concurrent assertion or employment of any other appropriate right or remedy.


Section 6.11 Delay or Omission Not Waiver.




          No delay or omission of the Trustee or of any Holder to exercise any right or remedy accruing
upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such
Event of Default or an acquiescence therein. Every right and remedy given by this Article or by
law to the Trustee or to the Holders may be exercised from time to time, and as often as may be
deemed expedient, by the Trustee or by the Holders, as the case may be.


Section 6.12 Trustee May File Proofs of Claim.




          The Trustee may file proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Issuer (or any other
obligor upon the Notes including the Guarantors), its creditors or its property and is entitled and
empowered to participate as a member in any official committee of creditors appointed in such
matter and to collect, receive and distribute any money or other property payable or deliverable on
any such claims. Any custodian in any such judicial proceeding is hereby authorized by each Holder
to make such payments to the Trustee, and in the event that the Trustee shall consent to the making
of such payments directly to the Holders, to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Trustee and its agents and
counsel, and any other amounts due the Trustee under Section 7.07. To the extent that the payment
of any such compensation, expenses, disbursements and advances of the Trustee, its agents and
counsel, and any other amounts due the Trustee



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under Section 7.07 out of the estate in any such proceeding, shall be denied for any reason,
payment of the same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties that the Holders may be entitled
to receive in such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization,
arrangement, adjustment or composition affecting the Notes or the rights of any Holder, or to
authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.



Section 6.13 Priorities.




     If the Trustee collects any money or property pursuant to this Article 6, it shall pay out the
money in the following order:



          (a) to the Trustee and its agents and attorneys for amounts due under Section 7.07, including
payment of all compensation, expenses and liabilities incurred, and all advances made, by the
Trustee and the costs and expenses of collection;



          (b) to Holders for amounts due and unpaid on the Notes for principal, premium, if any, and
interest ratably, without preference or priority of any kind, according to the amounts due and
payable on the Notes for principal, premium, if any, and interest respectively; and



          (c) to the Issuer or to such party as a court of competent jurisdiction shall direct including
a Guarantor, if applicable.


The Trustee may fix a record date and payment date for any payment to Holders pursuant to this
Section 6.13. Promptly after any record date is set pursuant to this paragraph, the Trustee shall
cause notice of such record date and payment date to be given to the Issuer and to each Holder in
the manner set forth in Section 14.02.



Section 6.14 Undertaking for Costs.




          In any suit for the enforcement of any right or remedy under this Indenture or in any suit
against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion
may require the filing by any party litigant in such suit to file an undertaking to pay the costs
of the suit, and the court in its discretion may assess reasonable costs, including reasonable
attorneys’ fees, against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section 6.14 does not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 6.07, or a suit by Holders of more than
10% in aggregate principal amount of the then outstanding Notes.



ARTICLE 7




TRUSTEE


Section 7.01 Duties of Trustee.




          (a) If an Event of Default has occurred and is continuing, the Trustee shall exercise such of
the rights and powers vested in it by this Indenture or the Collateral Documents, and use the same
degree of care and skill in its exercise, as a prudent person would exercise or use under the
circumstances in the conduct of such person’s own affairs.



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     (b) Except during the continuance of an Event of Default:




     (1) the duties of the Trustee shall be determined solely by the express provisions of
this Indenture and the Collateral Documents and the Trustee need perform only those duties
that are specifically set forth in this Indenture and no others, and no implied covenants or
obligations shall be read into this Indenture and the Collateral Documents against the
Trustee; and




     (2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the requirements of this
Indenture. However, in the case of any such certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the Trustee shall examine
the certificates and opinions to determine whether or not they conform to the requirements
of this Indenture (but need not confirm or investigate the accuracy of mathematical
calculations or other facts stated therein).



          (c) The Trustee may not be relieved from liabilities for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that:




     (1) this paragraph does not limit the effect of paragraph (b) of this Section 7.01;




     (2) the Trustee shall not be liable for any error of judgment made in good faith by a
Responsible Officer, unless it is proved in a court of competent jurisdiction that the
Trustee was negligent in ascertaining the pertinent facts; and




     (3) the Trustee shall not be liable with respect to any action it takes or omits to
take in good faith in accordance with a direction received by it pursuant to Section 6.05.



          (d) Whether or not therein expressly so provided, every provision of this Indenture that in
any way relates to the Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.01.



          (e) The Trustee shall be under no obligation to exercise any of its rights or powers under
this Indenture or the Collateral Documents at the request or direction of any of the Holders unless
the Holders have offered to the Trustee indemnity or security reasonably satisfactory to it against
any loss, liability or expense.



          (f) The Trustee shall not be liable for interest on any money received by it except as the
Trustee may agree in writing with the Issuer. Money held in trust by the Trustee need not be
segregated from other funds except to the extent required by law.


Section 7.02 Rights of Trustee.




          (a) The Trustee may conclusively rely upon any document believed by it to be genuine and to
have been signed or presented by the proper Person. The Trustee need not investigate any fact or
matter stated in the document, but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the books, records and
premises of the Issuer, personally or by agent or attorney at the sole cost of the Issuer and shall
incur no liability or additional liability of any kind by reason of such inquiry or investigation.



          (b) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate
or an Opinion of Counsel or both subject to the other provisions of this Indenture. The Trustee
shall not be liable for any action it takes or omits to take in good faith in reliance on such
Officers’



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Certificate or Opinion of Counsel. The Trustee may consult with counsel of its selection and
the written advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection from liability in respect of any action taken, suffered or omitted by
it hereunder in good faith and in reliance thereon.




          (c) The Trustee may act through its attorneys and agents and shall not be responsible for the
misconduct or negligence of any agent or attorney appointed with due care.



          (d) The Trustee shall not be liable for any action it takes or omits to take in good faith
that it believes to be authorized or within the rights or powers conferred upon it by this
Indenture.



          (e) Unless otherwise specifically provided in this Indenture, any demand, request, direction
or notice from the Issuer shall be sufficient if signed by an Officer of the Issuer.



          (f) None of the provisions of this Indenture shall require the Trustee to expend or risk its
own funds or otherwise to incur any liability, financial or otherwise, in the performance of any of
its duties hereunder, or in the exercise of any of its rights or powers if it shall have reasonable
grounds for believing that repayment of such funds or indemnity reasonably satisfactory to it
against such risk or liability is not assured to it.



          (g) The Trustee shall not be deemed to have notice of any Default or Event of Default unless a
Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any
event which is in fact such a Default is received by the Trustee at the Corporate Trust Office of
the Trustee, and such notice references the existence of a Default or Event of Default, the Notes
and this Indenture.



          (h) In no event shall the Trustee be responsible or liable for special, indirect, or
consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit)
irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and
regardless of the form of action.



          (i) The rights, privileges, protections, immunities and benefits given to the Trustee,
including, without limitation, its right to be indemnified, are extended to, and shall be
enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and
other Person employed to act hereunder.



          (j) The Trustee may request that the Issuer deliver an Officers’ Certificate setting forth the
names of individuals and/or titles of officers authorized at such time to take specified actions
pursuant to this Indenture, which Officers’ Certificate may be signed by any person authorized to
sign an Officers’ Certificate, including any Person specified as so authorized in any such
certificate previously delivered and not superseded.


Section 7.03 Individual Rights of Trustee.




          The Trustee in its individual or any other capacity may become the owner or pledgee of Notes
and may otherwise deal with the Issuer or any Affiliate of the Issuer with the same rights it would
have if it were not Trustee. Any Agent may do the same with like rights. However, in the event
that the Trustee acquires any conflicting interest it must eliminate such conflict within 90 days
or resign. Any Agent may do the same with like rights and duties. The Trustee is also subject to
Section 7.10 and 7.11.



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Section 7.04 Trustee’s Disclaimer.




          The Trustee shall not be responsible for and makes no representation as to the validity or
adequacy of this Indenture or the Notes, it shall not be accountable for the Issuer’s use of the
proceeds from the Notes or any money paid to the Issuer or upon the Issuer’s direction under any
provision of this Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be responsible for any
statement or recital herein or any statement in the Notes or any other document in connection with
the sale of the Notes or pursuant to this Indenture other than its certificate of authentication.


Section 7.05 Notice of Defaults.




          If a Default occurs and is continuing and if it is known to the Trustee, the Trustee shall
mail to each Holder a notice of the Default within 90 days after it occurs. Except in the case of
a Default relating to the payment of principal of and premium, if any, or interest on any Note, the
Trustee may withhold from the Holders notice of any continuing Default if and so long as a
committee of its Responsible Officers in good faith determines that withholding the notice is in
the interests of the Holders. The Trustee shall not be deemed to know of any Default unless a
Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any
event which is such a Default is received by the Trustee at the Corporate Trust Office of the
Trustee.


Section 7.06 Reports by Trustee to Holders of the Notes.




          (a) Within 60 days after each October 15, beginning with the October 15 following the date of
this Indenture, and for so long as Notes remain outstanding, the Trustee shall mail to the Holders
of the Notes a brief report dated as of such reporting date that complies with Trust Indenture Act
Section 313(a) (but if no event described in Trust Indenture Act Section 313(a) has occurred within
the twelve months preceding the reporting date, no report need be transmitted). The Trustee also
shall comply with Trust Indenture Act Section 313(b)(2). The Trustee shall also transmit by mail
all reports as required by Trust Indenture Act Section 313(c).



          (b) A copy of each report at the time of its mailing to the Holders shall be mailed to the
Issuer and filed with each national securities exchange on which the Notes are listed in accordance
with Trust Indenture Act Section 313(d). The Issuer shall promptly notify the Trustee in the event
the Notes are listed on any national securities exchange.


Section 7.07 Compensation and Indemnity.




          (a) The Issuer and the Guarantors, jointly and severally, shall pay to the Trustee from time
to time such compensation for its acceptance of this Indenture and services hereunder as the
parties shall agree in writing from time to time. The Trustee’s compensation shall not be limited
by any law on compensation of a trustee of an express trust. The Issuer shall reimburse the
Trustee promptly upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses shall include the
reasonable compensation, disbursements and expenses of the Trustee’s agents and counsel. The
Trustee shall provide the Issuer reasonable notice of any expenditure not in the ordinary course of
business.



          (b) The Issuer and the Guarantors, jointly and severally, shall indemnify the Trustee for, and
hold the Trustee harmless against, any and all loss, damage, claims, liability or expense
(including attorneys’ fees) incurred by it in connection with the acceptance or administration of
this trust and the performance of its duties hereunder (including the costs and expenses of
enforcing this Indenture against the Issuer or any Guarantor (including this Section 7.07)) or
defending itself against any claim



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whether asserted by any Holder, the Issuer or any Guarantor, or liability in connection with
the acceptance, exercise or performance of any of its powers or duties hereunder). The Trustee
shall notify the Issuer promptly of any claim for which it may seek indemnity. Failure by the
Trustee to so notify the Issuer shall not relieve the Issuer of its obligations hereunder. The
Issuer shall defend the claim and the Trustee may have separate counsel and the Issuer shall pay
the fees and expenses of such counsel. The Issuer need not reimburse any expense or indemnify
against any loss, liability or expense incurred by the Trustee through the Trustee’s own willful
misconduct, negligence or bad faith.




          (c) The obligations of the Issuer under this Section 7.07 shall survive the satisfaction and
discharge of this Indenture or the earlier resignation or removal of the Trustee.



          (d) To secure the payment obligations of the Issuer and the Guarantors in this Section 7.07,
the Trustee shall have a Lien prior to the Notes on all money or property held or collected by the
Trustee, except that held in trust to pay principal and interest on particular Notes. Such Lien
shall survive the satisfaction and discharge of this Indenture.



          (e) When the Trustee incurs expenses or renders services after an Event of Default specified
in Section 6.01(a)(7) or (9) occurs, the expenses and the compensation for the services (including
the fees and expenses of its agents and counsel) are intended to constitute expenses of
administration under any Bankruptcy Law.


Section 7.08 Replacement of Trustee.




          (a) A resignation or removal of the Trustee and appointment of a successor Trustee shall
become effective only upon the successor Trustee’s acceptance of appointment as provided in this
Section 7.08. The Trustee may resign in writing at any time by giving 30 days’ prior notice of
such resignation to the Issuer and be discharged from the trust hereby created by so notifying the
Issuer. The Holders of a majority in aggregate principal amount of the then outstanding Notes may
remove the Trustee by so notifying the Trustee and the Issuer in writing. The Issuer may remove
the Trustee if:




     (1) the Trustee fails to comply with Section 7.10;




     (2) the Trustee is adjudged a bankrupt or an insolvent or an order for relief is
entered with respect to the Trustee under any Bankruptcy Law;




     (3) a receiver or public officer takes charge of the Trustee or its property; or




     (4) the Trustee becomes incapable of acting.



          (b) If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for
any reason, the Issuer shall promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in aggregate principal amount of the then
outstanding Notes may appoint a successor Trustee to replace the successor Trustee appointed by the
Issuer.



          (c) If a successor Trustee does not take office within 60 days after the retiring Trustee
resigns or is removed, the retiring Trustee (at the Issuer’s expense), the Issuer or the Holders of
at least 10% in aggregate principal amount of the then outstanding Notes may petition any court of
competent jurisdiction for the appointment of a successor Trustee.



          (d) If the Trustee, after written request by any Holder who has been a Holder for at least six
months, fails to comply with Section 7.10, such Holder may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.



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          (e) A successor Trustee shall deliver a written acceptance of its appointment to the retiring
Trustee and to the Issuer. Thereupon, the resignation or removal of the retiring Trustee shall
become effective, and the successor Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to
Holders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the
successor Trustee; provided all sums owing to the Trustee hereunder have been paid and
subject to the Lien provided for in Section 7.07. Notwithstanding replacement of the Trustee
pursuant to this Section 7.08, the Issuer’s obligations under Section 7.07 shall continue for the
benefit of the retiring Trustee.



          (f) As used in this Section 7.08, the term “Trustee” shall also include each Agent.


Section 7.09 Successor Trustee by Merger, etc.




          If the Trustee consolidates, merges or converts into, or transfers all or substantially all of
its corporate trust business to, another corporation or national banking association, the successor
corporation or national banking association without any further act shall be the successor Trustee,
subject to Section 7.10.


Section 7.10 Eligibility; Disqualification.




          (a) There shall at all times be a Trustee hereunder that is a corporation or national banking
association organized and doing business under the laws of the United States of America or of any
state thereof that is authorized under such laws to exercise corporate trustee power, that is
subject to supervision or examination by federal or state authorities and that has a combined
capital and surplus of at least $50,000,000 as set forth in its most recent published annual report
of condition.



          (b) This Indenture shall always have a Trustee who satisfies the requirements of Trust
Indenture Act Sections 310(a)(1), (2) and (5). The Trustee is subject to Trust Indenture Act
Section 310(b).


Section 7.11 Preferential Collection of Claims Against the Issuer.




          (a) The Trustee is subject to Trust Indenture Act Section 311(a), excluding any creditor
relationship listed in Trust Indenture Act Section 311(b). A Trustee who has resigned or been
removed shall be subject to Trust Indenture Act Section 311(a) to the extent indicated therein.



          (b) As used in this Article 7, the term “Trustee” shall also include the Collateral Agent in
respect of the Collateral Documents.


Section 7.12 Quebec Power of Attorney




          For the purposes of holding any security granted by the Issuer or any of the Guarantors
pursuant to the laws of the Province of Quebec, each of the Trustee and the Collateral Agent shall
be the holder of an irrevocable power of attorney for itself and all present and future Holders, as
contemplated in Article 2692 of the Civil Code of Quebec. By becoming a Holder, each Holder shall
be deemed to ratify the power of attorney granted to the Trustee and the Collateral Agent
hereunder. Notwithstanding Section 32 of the Act respecting the Special Powers of legal Persons
(Quebec), the Trustee and the Collateral Agent may acquire any Notes or other titles of
indebtedness secured by any hypothec granted by the Issuer or any of the Guarantors pursuant to the
laws of the Province of Quebec.




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ARTICLE 8




LEGAL DEFEASANCE AND COVENANT DEFEASANCE



Section 8.01 Option to Effect Legal Defeasance or Covenant Defeasance.




           The Issuer may, at its option and at any time, elect to have either Section 8.02 or 8.03
applied to all outstanding Notes upon compliance with the conditions set forth below in this
Article 8.



Section 8.02 Legal Defeasance and Discharge.




          (a) Upon the Issuer’s exercise under Section 8.01 of the option applicable to this Section
8.02, the Issuer and the Guarantors shall, subject to the satisfaction of the conditions set forth
in Section 8.04, be deemed to have been discharged from their obligations with respect to all
outstanding Notes and Notes Guarantees on the date the conditions set forth below are satisfied
(“Legal Defeasance”). For this purpose, Legal Defeasance means that the Issuer shall be
deemed to have paid and discharged the entire Indebtedness represented by the outstanding Notes,
which shall thereafter be deemed to be “outstanding” only for the purposes of Section 8.05 and the
other Sections of this Indenture referred to in (1) and (2) below, and to have satisfied all of its
other obligations under such Notes and this Indenture, including that of the Guarantors (and the
Trustee, on demand of and at the expense of the Issuer, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive until otherwise
terminated or discharged hereunder:




     (1) the rights of Holders to receive payments in respect of the principal of and
premium, if any, and interest on the Notes when such payments are due, solely out of the
trust created pursuant to this Indenture referred to in Section 8.04;




     (2) the Issuer’s obligations with respect to Notes concerning issuing temporary Notes,
registration of such Notes, mutilated, destroyed, lost or stolen Notes and the maintenance
of an office or agency for payment and money for security payments held in trust;




     (3) the rights, powers, trusts, duties and immunities of the Trustee, and the Issuer’s
obligations in connection therewith; and




     (4) this Section 8.02.



          (b) Following the Issuer’s exercise of its Legal Defeasance option, payment of the Notes may
not be accelerated because of an Event of Default.



          (c) Subject to compliance with this Article 8, the Issuer may exercise its option under this
Section 8.02 notwithstanding the prior exercise of its option under Section 8.03.



Section 8.03 Covenant Defeasance.




          Upon the Issuer’s exercise under Section 8.01 of the option applicable to this Section 8.03,
the Issuer and the Guarantors shall, subject to the satisfaction of the conditions set forth in
Section 8.04, be released from their obligations under the covenants contained in Sections 4.03,
4.04, 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.14 , 4.15, 4.16, 4.17, 4.19 and 9.07 with respect to
the outstanding Notes, on and after the date the conditions set forth in Section 8.04 are satisfied
(“Covenant Defeasance”), and the Notes shall thereafter be deemed not “outstanding” for the
purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences
of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding”
for all other purposes hereunder (it being understood that



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such Notes shall not be deemed outstanding for accounting purposes). For this purpose,
Covenant Defeasance means that, with respect to this Indenture and the outstanding Notes, the
Issuer may omit to comply with and shall have no liability in respect of any term, condition or
limitation set forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference in any such covenant
to any other provision herein or in any other document and such omission to comply shall not
constitute a Default or an Event of Default under Section 6.01, but, except as specified above, the
remainder of this Indenture, and such Notes and the Notes Guarantees shall be unaffected thereby.
In addition, upon the Issuer’s exercise under Section 8.01 of the option applicable to this Section
8.03, subject to the satisfaction of the conditions set forth in Section 8.04, the operation of
Section 6.01(a)(3) (only with respect to Section 5.01(a)(4)), Section 6.01(a)(4), Section
6.01(a)(5), Section 6.01(a)(6), Section 6.01(a)(7) (solely with respect to Restricted Subsidiaries
that are Significant Subsidiaries or a group of Restricted Subsidiaries that, taken together as of
the date of the most recent audited financial statements of the Issuer, would constitute a
Restricted Subsidiary), Section 6.01(a)(9) (solely with respect to Restricted Subsidiaries that are
Significant Subsidiaries or a group of Restricted Subsidiaries that, taken together as of the date
of the most recent audited financial statements of the Issuer, would constitute a Restricted
Subsidiary), Section 6.01(a)(10) and Section 6.01(a)(11) shall not constitute Events of Default.




Section 8.04 Conditions to Legal or Covenant Defeasance.




     The following shall be the conditions to the exercise of either the Legal Defeasance option
under Section 8.02 or the Covenant Defeasance option under Section 8.03 with respect to the Notes:




     (1) the Issuer must irrevocably deposit with the Trustee, in trust, for the benefit of
the Holders, cash in U.S. dollars, Government Securities, or a combination thereof, in such
amounts as will be sufficient, in the opinion of a nationally recognized firm of independent
public accountants, to pay the principal of and premium, if any, and interest due on the
outstanding Notes on the Stated Maturity or on the applicable redemption date, as the case
may be, and the Issuer must specify whether the Notes are being defeased to maturity or to a
particular redemption date;




     (2) in the case of Legal Defeasance, the Issuer shall have delivered to the Trustee an
Opinion of Counsel reasonably acceptable to the Trustee confirming that, subject to
customary assumptions and exclusions,




     (A) the Issuer has received from, or there has been published by, the U.S.
Internal Revenue Service a ruling, or




     (B) since the Issue Date, there has been a change in the applicable U.S.
federal income tax law,




in either case to the effect that, and based thereon such Opinion of Counsel will confirm
that, subject to customary assumptions and exclusions, the Holders will not recognize
income, gain or loss for U.S. federal income tax purposes, as applicable, as a result of
such Legal Defeasance and will be subject to U.S. federal income tax on the same amounts, in
the same manner and at the same times as would have been the case if such Legal Defeasance
had not occurred;



     (3) in the case of Covenant Defeasance, the Issuer shall have delivered to the Trustee
an Opinion of Counsel reasonably acceptable to the Trustee confirming that, subject to
customary assumptions and exclusions, the Holders will not recognize income, gain or loss
for U.S. federal income tax purposes as a result of such Covenant Defeasance and will be
subject to U.S. federal



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income tax on the same amounts, in the same manner and at the same times as would have
been the case if such Covenant Defeasance had not occurred;




          (4) such Legal Defeasance or Covenant Defeasance shall not result in a breach or
violation of, or constitute a default under the Senior Credit Facility or any other material
agreement or instrument (other than this Indenture) to which the Issuer or any Guarantor is
a party or by which the Issuer or any Guarantor is bound;




          (5) no Default or Event of Default shall have occurred and be continuing on the date of
such deposit (other than that resulting from borrowing funds to be applied to make such
deposit and any similar and simultaneous deposit relating to other Indebtedness and, in each
case, the granting of Liens in connection therewith) or insofar as Events of Default
resulting from the borrowing of funds or insolvency events are concerned, at any time in the
period ending on the 91st day after the date of deposit;




          (6) the Issuer shall have delivered to the Trustee an Opinion of Counsel to the effect
that, as of the date of such opinion and subject to customary assumptions and exclusions,
including that no intervening bankruptcy of the Issuer between the date of deposit and the
91st day following the deposit and assuming that no holder is an “insider” of the Issuer
under applicable bankruptcy law, after the 91st day following the deposit, the trust funds
will not be subject to the effect of Section 547 of Title 11 of the United States Code;




          (7) the Issuer shall have delivered to the Trustee an Officers’ Certificate stating
that the deposit was not made by the Issuer with the intent of defeating, hindering,
delaying or defrauding any creditors of the Issuer or any Guarantor or others; and




          (8) the Issuer shall have delivered to the Trustee an Officers’ Certificate and an
Opinion of Counsel (which Opinion of Counsel may be subject to customary assumptions and
exclusions), each stating that all conditions precedent provided for or relating to the
Legal Defeasance or the Covenant Defeasance, as the case may be, have been complied with.
In the case of Legal Defeasance only, such Opinion of Counsel must be based on a ruling of
the Internal Revenue Service or other change in applicable Federal income tax law.



Section 8.05 Deposited Money and Government Securities to Be Held in Trust; Other Miscellaneous
Provisions.




          (a) Subject to Section 8.06, all money and Government Securities (including the proceeds
thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this
Section 8.05, the “Trustee”) pursuant to Section 8.04 in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes
and this Indenture, to the payment, either directly or through any Paying Agent (including the
Issuer or a Guarantor acting as Paying Agent) as the Trustee may determine, to the Holders of all
sums due and to become due thereon in respect of principal, premium, if any, and interest, but such
money need not be segregated from other funds except to the extent required by law.



          (b) The Issuer shall pay and indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against the cash or Government Securities deposited pursuant to Section 8.04
or the principal and interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders.



          (c) Anything in this Article 8 to the contrary notwithstanding, the Trustee shall deliver or
pay to the Issuer from time to time upon the request of the Issuer any money or Government



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Securities held by it as provided in Section 8.04 which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under Section 8.04(a)), are in excess
of the amount thereof that would then be required to be deposited to effect an equivalent Legal
Defeasance or Covenant Defeasance.




Section 8.06 Repayment to the Issuer.




          Subject to any applicable abandoned property law, any money deposited with the Trustee or any
Paying Agent, or then held by the Issuer, in trust for the payment of the principal of or premium,
if any, or interest, on any Note and remaining unclaimed for two years after such principal,
premium, if any, or interest, has become due and payable shall be paid to the Issuer on its request
or (if then held by the Issuer) shall be discharged from such trust; and the Holder of such Note
shall thereafter look only to the Issuer for payment thereof, and all liability of the Trustee or
such Paying Agent with respect to such trust money, and all liability of the Issuer as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such Paying
Agent, before being required to make any such repayment, may at the expense of the Issuer cause to
be published once, in The New York Times or The Wall Street Journal (national
edition), notice that such money remains unclaimed and that, after a date specified therein, which
shall not be less than 30 days from the date of such notification or publication, any unclaimed
balance of such money then remaining shall be repaid to the Issuer.



Section 8.07 Reinstatement.




          If the Trustee or Paying Agent is unable to apply any U.S. dollars or Government Securities in
accordance with Section 8.02 or 8.03, as the case may be, by reason of any order or judgment of any
court or Governmental Authority enjoining, restraining or otherwise prohibiting such application,
then the Issuer’s and the Guarantors’ obligations under this Indenture, the Notes and the Notes
Guarantees shall be revived and reinstated as though no deposit had occurred pursuant to Section
8.02 or 8.03 until such time as the Trustee or Paying Agent is permitted to apply all such money in
accordance with Section 8.02 or 8.03, as the case may be; provided that, if the Issuer
makes any payment of principal of or premium, if any, or interest on any Note following the
reinstatement of its obligations, the Issuer shall be subrogated to the rights of the Holders to
receive such payment from the money held by the Trustee or Paying Agent.



ARTICLE 9




AMENDMENT, SUPPLEMENT AND WAIVER



Section 9.01 Without Consent of Holders.




          (a) Notwithstanding Section 9.02, without the consent of any Holder, the Issuer, the
Guarantors and the Trustee may amend or supplement this Indenture, the Notes, the Notes Guarantees,
the Collateral Documents or the Intercreditor Agreements to:




     (1) cure any ambiguity, omission, defect or inconsistency;




     (2) provide for the assumption by a successor entity of the obligations of the Issuer
or any Guarantor under this Indenture, the Notes, the Notes Guarantees, the Collateral
Documents or the Intercreditor Agreements;




     (3) provide for or facilitate the issuance of uncertificated Notes in addition to or in
place of certificated Notes (provided that the uncertificated Notes are issued in
registered form for



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purposes of Section 163(f) of the Code, or in a manner such that the uncertificated
Notes are described in Section 163(f)(2)(B) of the Code);




     (4) comply with the rules of any applicable Depositary;




     (5) add Guarantors with respect to the Notes or release a Guarantor from its
obligations under its Notes Guarantee or this Indenture in accordance with the applicable
provisions of this Indenture, the Notes Guarantees, the Collateral Documents or the
Intercreditor Agreements;




     (6) add additional Collateral to secure the Notes;




     (7) add covenants of the Issuer or Events of Default for the benefit of or to make
changes that would provide additional rights to the Holders, or to surrender any right or
power conferred upon the Issuer or any Guarantor;




     (8) make any change that does not adversely affect the legal rights under this
Indenture of any Holder;




     (9) comply with any requirement of the SEC in connection with any required
qualification of this Indenture under the Trust Indenture Act;




     (10) evidence and provide for the acceptance of an appointment under this Indenture of
a successor Trustee; provided that the successor Trustee is otherwise qualified and
eligible to act as such under the terms of this Indenture;




     (11) provide for the issuance of Additional Notes, which shall be treated, together
with any outstanding Notes, as a single class of securities;




     (12) conform the text of this Indenture, the Notes or the Notes Guarantees to any
provision of the “Description of notes” section of the Offering Memorandum to the extent
that such provision in such “Description of notes” section was intended to be a verbatim
recitation of a provision of this Indenture, the Notes or the Notes Guarantees; or




     (13) make any amendment to the provisions of this Indenture relating to the transfer
and legending of Notes as permitted by this Indenture, including, without limitation to
facilitate the issuance and administration of the Notes; provided, however,
that (A) compliance with this Indenture as so amended would not result in Notes being
transferred in violation of the Securities Act or any applicable securities law and (B) such
amendment does not materially and adversely affect the rights of Holders to transfer Notes.


In addition, the Collateral Agent and the Trustee are authorized to amend the Collateral Documents
to comply with the provisions thereof.





          (b) Upon the request of the Issuer accompanied by a resolution of its Board of Directors
authorizing the execution of any such amended or supplemental indenture, and upon receipt by the
Trustee of the documents described in Section 14.04, the Trustee shall join with the Issuer and the
Guarantors in the execution of any amended or supplemental indenture authorized or permitted by the
terms of this Indenture and to make any further appropriate agreements and stipulations that may be
therein contained, but the Trustee shall not be obligated to enter into such amended or
supplemental indenture that affects its own rights, duties or immunities under this Indenture or
otherwise. Notwithstanding the foregoing, no Opinion of Counsel shall be required in connection
with the addition



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of a Guarantor under this Indenture upon execution and delivery by such Guarantor and the
Trustee of a supplemental indenture to this Indenture, the form of which is attached as Exhibit C,
and delivery of an Officers’ Certificate, except as provided in Section 4.17 and Section 5.01(c).




Section 9.02 With Consent of Holders.





          (a) Except as provided below in this Section 9.02, the Issuer and the Trustee may amend or
supplement this Indenture, the Notes, the Notes Guarantees, the Collateral Documents or the
Intercreditor Agreements with the consent of the Holders of a majority in principal amount of the
Notes (including Additional Notes, if any) then outstanding voting as a single class (including,
without limitation, consents obtained in connection with a purchase of, or tender offer or exchange
offer for, Notes), and, subject to Sections 6.04 and 6.07, any existing Default or Event of Default
(other than a Default or Event of Default in the payment of the principal of or premium, if any, or
interest on the Notes, except a payment default resulting from an acceleration that has been
rescinded) or compliance with any provision of this Indenture, the Notes or the Notes Guarantees
may be waived with the consent of the Holders of a majority in principal amount of the then
outstanding Notes (including Additional Notes, if any) voting as a single class (including consents
obtained in connection with the purchase of, or tender offer or exchange offer for, Notes).
Section 2.08 and Section 2.09 shall determine which Notes are considered to be “outstanding” for
the purposes of this Section 9.02.




          (b) Upon the request of the Issuer accompanied by a resolution of its board of directors
authorizing the execution of any such amended or supplemental indenture, and upon the filing with
the Trustee of evidence satisfactory to the Trustee of the consent of the Holders as aforesaid, and
upon receipt by the Trustee of the documents described in Section 7.02 and Section 14.04, the
Trustee shall join with Parent, the Issuer and the Guarantors in the execution of such amended or
supplemental indenture unless such amended or supplemental indenture directly affects the Trustee’s
own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may
in its discretion, but shall not be obligated to, enter into such amended or supplemental
indenture.




          (c) The consent of the Holders is not necessary under this Section 9.02 to approve the
particular form of any proposed amendment, supplement or waiver. It is sufficient if such consent
approves the substance of the proposed amendment, supplement or waiver. A consent to any
amendment, supplement or waiver under this Section 9.02 by any Holder given in connection with a
tender of such Holder’s Notes will not be rendered invalid by such tender.




          (d) After an amendment, supplement or waiver under this Section 9.02 becomes effective, the
Issuer shall mail to the Holders of Notes affected thereby a notice briefly describing such
amendment or supplement. Any failure of the Issuer to give such notice to all the Holders, or any
defect therein, shall not, however, in any way impair or affect the validity of the amendment or
supplement.




          (e) Without the consent of each affected Holder, an amendment, supplement or waiver under this
Section 9.02 may not (with respect to any Notes held by a non-consenting Holder):




     (1) reduce the principal amount of such Notes whose Holders must consent to an
amendment, supplement or waiver;




     (2) reduce the stated rate of or extend the time for payment of interest on any Note;




     (3) reduce the principal of or extend the Stated Maturity of any Note;




     (4) reduce the premium payable upon the redemption or repurchase of any Note or change
the time at which any Note may be redeemed or repurchased as described under Sections



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3.09, 4.10 or 4.14 whether through an amendment or waiver of provisions in the
covenants, definitions or otherwise (except amendments to the definition of “Change of
Control”);




     (5) make any Note payable in money other than that stated therein;




     (6) impair the right of any Holder to receive payment of principal of, or premium, if
any, or interest on such Holder’s Notes on or after the due dates therefor or to institute
suit for the enforcement of any payment on or with respect to such Holder’s Notes;




     (7) make any change in the amendment provisions which require each Holder’s consent or
in the waiver provisions; or




     (8) modify the Notes Guarantees in any manner adverse to the Holders; or




     (9) modify the provisions of the Collateral Documents or the Intercreditor Agreements
in any manner adverse to the Holders or release all or substantially all of the Collateral
from the Lien under the Collateral Documents (except as permitted by the terms of this
Indenture, the Collateral Documents and the Intercreditor Agreements) or change or alter the
priority of the security interests in the Collateral; or




     (10) make any change to or modify the ranking of the Notes that would adversely affect
the Holders.



          (f) Notwithstanding the foregoing, without consent of the Holders of at least two-thirds in
aggregate principal amount of Notes then outstanding, an amendment, supplement or waiver may not:




     (1) modify any Collateral Document or the provisions in this Indenture dealing with
Collateral Documents or application of trust moneys in any manner adverse to the Holders of
the Notes or otherwise release any Collateral other than in accordance with this Indenture,
the Collateral Documents and the Intercreditor Agreements; or




     (2) modify any Intercreditor Agreements in any manner adverse to the Holders of the
Notes in any material respect other than in accordance with the terms of this Indenture, the
Collateral Documents and the Intercreditor Agreements.



Section 9.03 Compliance with Trust Indenture Act.




          If this Indenture is qualified under the Trust Indenture Act, every amendment or supplement to
this Indenture or the Notes shall be set forth in an amended or supplemental indenture that
complies with the Trust Indenture Act as then in effect.



Section 9.04 Revocation and Effect of Consents.




          (a) Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder of
a Note is a continuing consent by the Holder of a Note and every subsequent Holder of a Note or
portion of a Note that evidences the same debt as the consenting Holder’s Note, even if notation of
the consent is not made on any Note. However, any such Holder of a Note or subsequent Holder of a
Note may revoke the consent as to its Note if the Trustee receives written notice of revocation
before the date the waiver, supplement or amendment becomes effective. An amendment, supplement or
waiver becomes effective in accordance with its terms and thereafter binds every Holder.



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          (b) The Issuer may, but shall not be obligated to, fix a record date pursuant to Section 1.05
for the purpose of determining the Holders entitled to consent to any amendment, supplement, or
waiver.



Section 9.05 Notation on or Exchange of Notes.




          (a) The Trustee may place an appropriate notation about an amendment, supplement or waiver on
any Note thereafter authenticated. The Issuer in exchange for all Notes may issue and the Trustee
shall, upon receipt of an Authentication Order, authenticate new Notes that reflect the amendment,
supplement or waiver.



          (b) Failure to make the appropriate notation or issue a new Note shall not affect the validity
and effect of such amendment, supplement or waiver.



Section 9.06 Trustee to Sign Amendments, etc.




          The Trustee and the Collateral Agent shall sign any amendment, supplement or waiver authorized
pursuant to this Article 9 if the amendment or supplement does not adversely affect the rights,
duties, liabilities or immunities of the Trustee and the Collateral Agent. The Issuer may not sign
an amendment, supplement or waiver until its Board of Directors approves it. In executing any
amendment, supplement or waiver, the Trustee and the Collateral Agent shall be entitled to receive
and (subject to Section 7.01) shall be fully protected in relying upon, in addition to the
documents required by Section 14.04, an Officers’ Certificate and an Opinion of Counsel stating
that the execution of such amended or supplemental indenture is authorized or permitted by this
Indenture and that such amendment, supplement or waiver is the legal, valid and binding obligation
of the Issuer and any Guarantor party thereto, enforceable against them in accordance with its
terms, subject to customary exceptions, and complies with the provisions hereof (including Section
9.03).



Section 9.07 Payment for Consent.




          None of Parent, the Issuer or any of their respective Subsidiaries shall, directly or
indirectly, pay or cause to be paid any consideration to or for the benefit of any Holder, whether
by way of interest, fees or otherwise to any Holder, for or as an inducement to any consent, waiver
or amendment of any of the terms or provisions of this Indenture or the Notes unless such
consideration is offered to be paid and is paid to all Holders that consent, waive or agree to
amend in the time frame set forth in the solicitation documents relating to such consent, waiver or
amendment.



ARTICLE 10




[RESERVED]



ARTICLE 11



GUARANTEES



Section 11.01 Notes Guarantee.




          (a) Subject to this Article 11, each of the Guarantors hereby, jointly and severally,
irrevocably and unconditionally guarantees, on a senior basis, to each Holder and to the Trustee
and its successors and assigns, irrespective of the validity and enforceability of this Indenture,
the Notes or the obligations of the Issuer hereunder or thereunder, that: (1) in the case of each
of Parent and each LGEI Subsidiary Guarantor, (A) the principal of and premium, if any, and
interest on the Notes shall be



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promptly paid in full when due, whether at maturity, by acceleration, redemption or otherwise,
and interest on the overdue principal of and interest on the Notes, if any, if lawful, and all
other obligations of the Issuer to the Holders or the Trustee hereunder or thereunder shall be
promptly paid in full or performed, all in accordance with the terms hereof and thereof; and (B) in
case of any extension of time of payment or renewal of any Notes or any of such other obligations,
that same shall be promptly paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at stated maturity, by acceleration or otherwise; and (2) in the case
of each Parent Subsidiary Guarantor, the Obligations of Parent in respect of Parent’s Notes
Guarantee shall be promptly be paid in full when due or performed in accordance with the terms
hereof. Failing payment by the Issuer (or in the case of the Parent’s Notes Guarantee, the Parent)
when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the
Guarantors shall be jointly and severally obligated to pay the same immediately. Each Guarantor
agrees that this is a guarantee of payment and not a guarantee of collection.




          (b) The Guarantors hereby agree that their obligations hereunder shall be unconditional,
irrespective of the validity, regularity or enforceability of the Notes or this Indenture, the
absence of any action to enforce the same, any waiver or consent by any Holder with respect to any
provisions hereof or thereof, the recovery of any judgment against the Issuer or the Parent, as
applicable, any action to enforce the same or any other circumstance which might otherwise
constitute a legal or equitable discharge or defense of a guarantor. Each Guarantor hereby waives
diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency
or bankruptcy of the Issuer or the Parent, as applicable, any right to require a proceeding first
against the Issuer or the Parent, as applicable, protest, notice and all demands whatsoever and
covenants that this Notes Guarantee shall not be discharged except by complete performance of the
obligations contained in the Notes and this Indenture, or pursuant to Section 11.06.



          (c) Each Guarantor also agrees to pay any and all costs and expenses (including reasonable
attorneys’ fees and expenses) incurred by the Trustee or any Holder in enforcing any rights under
this Section 11.01.



          (d) If any Holder or the Trustee is required by any court or otherwise to return to the
Issuer, the Guarantors or any custodian, trustee, liquidator or other similar official acting in
relation to the Issuer or the Guarantors, any amount paid either to the Trustee or such Holder,
this Notes Guarantee, to the extent theretofore discharged, shall be reinstated in full force and
effect.



          (e) Each Guarantor agrees that it shall not be entitled to any right of subrogation in
relation to the Holders in respect of any obligations guaranteed hereby until payment in full of
all obligations guaranteed hereby. Each Guarantor further agrees that, as between the Guarantors,
on the one hand, and the Holders and the Trustee, on the other hand, (1) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6 for the purposes of this
Notes Guarantee, notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby, and (2) in the event of any
declaration of acceleration of such obligations as provided in Article 6, such obligations (whether
or not due and payable) shall forthwith become due and payable by the Guarantors for the purpose of
this Notes Guarantee. The Guarantors shall have the right to seek contribution from any non-paying
Guarantor so long as the exercise of such right does not impair the rights of the Holders under the
Notes Guarantees.



          (f) Each Notes Guarantee shall remain in full force and effect and continue to be effective
should any petition be filed by or against the Issuer or the Parent, as applicable, for
liquidation, reorganization, should the Issuer or the Parent, as applicable, become insolvent or
make an assignment for the benefit of creditors or should a receiver or trustee be appointed for
all or any significant part of the Issuer’s assets, and shall, to the fullest extent permitted by
law, continue to be effective or be reinstated,



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as the case may be, if at any time payment and performance of the Notes are, pursuant to
applicable law, rescinded or reduced in amount, or must otherwise be restored or returned by any
obligee on the Notes or the Notes Guarantees, whether as a “voidable preference,” “fraudulent
transfer” or otherwise, all as though such payment or performance had not been made. In the event
that any payment or any part thereof, is rescinded, reduced, restored or returned, the Notes shall,
to the fullest extent permitted by law, be reinstated and deemed reduced only by such amount paid
and not so rescinded, reduced, restored or returned.




          (g) In case any provision of any Notes Guarantee shall be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.



          (h) Each payment to be made by a Guarantor in respect of its Notes Guarantee shall be made
without set-off, counterclaim, reduction or diminution of any kind or nature.



Section 11.02 Limitation on Guarantor Liability.




          Each Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that it is the
intention of all such parties that the Notes Guarantee of such Guarantor not constitute a
fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance
Act, the Uniform Fraudulent Transfer Act or any similar U.S. federal or state law or Canadian
federal or provincial law to the extent applicable to any Notes Guarantee. To effectuate the
foregoing intention, the Trustee, the Holders and the Guarantors hereby irrevocably agree that the
obligations of each Guarantor shall be limited to the maximum amount as will, after giving effect
to such maximum amount and all other contingent and fixed liabilities of such Guarantor that are
relevant under such laws and after giving effect to any collections from, rights to receive
contribution from or payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under this Article 11, result in the obligations of such
Guarantor under its Notes Guarantee not constituting a fraudulent conveyance or fraudulent transfer
under applicable law. Each Guarantor that makes a payment under its Notes Guarantee shall be
entitled upon payment in full of all Notes Guaranteed Obligations under this Indenture to a
contribution from each other Guarantor in an amount equal to such other Guarantor’s pro rata
portion of such payment based on the respective net assets of all the Guarantors at the time of
such payment determined in accordance with GAAP.



Section 11.03 Execution and Delivery.




          (a) To evidence its Notes Guarantee set forth in Section 11.01, each Guarantor hereby agrees
that this Indenture shall be executed on behalf of such Guarantor by an Officer or person holding
an equivalent title.



          (b) Each Guarantor hereby agrees that its Notes Guarantee set forth in Section 11.01 shall
remain in full force and effect notwithstanding the absence of the endorsement of any notation of
such Notes Guarantee on the Notes.



          (c) If an Officer whose signature is on this Indenture no longer holds that office at the time
the Trustee authenticates the Note, the Notes Guarantees shall be valid nevertheless.



          (d) The delivery of any Note by the Trustee, after the authentication thereof hereunder, shall
constitute due delivery of the Notes Guarantee set forth in this Indenture on behalf of the
Guarantors.



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          (e) If required by Section 4.17, the Issuer shall cause any newly created or acquired
Restricted Subsidiary to comply with the provisions of Section 4.17 and this Article 11, to the
extent applicable.



Section 11.04 Subrogation.




          Each Guarantor shall be subrogated to all rights of Holders against the Issuer in respect of
any amounts paid by any Guarantor pursuant to the provisions of Section 11.01; provided
that, if an Event of Default has occurred and is continuing, no Guarantor shall be entitled to
enforce or receive any payments arising out of, or based upon, such right of subrogation until all
amounts then due and payable by the Issuer under this Indenture or the Notes shall have been paid
in full.



Section 11.05 Benefits Acknowledged.




          Each Guarantor acknowledges that it will receive direct and indirect benefits from the
financing arrangements contemplated by this Indenture and that the guarantee and waivers made by it
pursuant to its Notes Guarantee are knowingly made in contemplation of such benefits.



Section 11.06 Release of Notes Guarantees.




          (a) A Notes Guarantee by a Guarantor shall be automatically and unconditionally released and
discharged, and no further action by such Guarantor, the Issuer or the Trustee shall be required
for the release of such Guarantor’s Notes Guarantee, upon:




     (1) (A) (i) in the case of the Notes Guarantee of a Guarantor that is a Restricted
Subsidiary, any sale, assignment, transfer, conveyance, exchange or other disposition (by
merger, consolidation or otherwise) of the Capital Stock of such Guarantor, after which the
applicable Guarantor is no longer a Restricted Subsidiary, (ii) in the case of the Notes
Guarantee of Parent or any other Parent Subsidiary Guarantor, the merger or consolidation of
Parent or such Parent Subsidiary Guarantor in a transaction permitted by Article 5 or (iii)
any sale, assignment, transfer, conveyance, exchange or other disposition of all or
substantially all the assets of such Subsidiary (other than by lease); provided
that, in each of the foregoing cases, (x) such disposition is made in compliance with this
Indenture, including Section 4.10 (it being understood that only such portion of the Net
Available Cash as is required to be applied on or before the date of such release in
accordance with Section 4.10 needs to be applied in accordance therewith at such time),
Section 4.15 and Article 5, and (y) all the obligations of such Guarantor under all
Indebtedness of the Issuer or its Restricted Subsidiaries terminate upon consummation of
such transaction;




     (B) the release or discharge of such Guarantor (other than Parent) from its
Guarantee of Indebtedness of the Issuer and the Guarantors under the Senior Credit
Facility (including by reason of the termination of the Senior Credit Facility) all
other Indebtedness of the Issuer and its Restricted Subsidiaries and/or the
Guarantee that resulted in the obligation of such Guarantor to Guarantee the Notes,
if such Guarantor would not then otherwise be required to Guarantee the Notes
pursuant to this Indenture (and treating any Guarantees of such Guarantor that
remain outstanding as Incurred at least 30 days prior to such release or discharge),
except a discharge or release by or as a result of payment under such Guarantee;
provided, that if such Person has Incurred any Indebtedness or issued any
Preferred Stock or Disqualified Stock in reliance on its status as a Guarantor under
Section 4.09, such Guarantor’s obligations under such Indebtedness, Disqualified
Stock or Preferred Stock, as the case may be, so Incurred are satisfied in full and
discharged or are otherwise permitted to be Incurred by a Restricted Subsidiary
(other than a Guarantor) under Section 4.09;



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     (C) the proper designation of any Restricted Subsidiary that is a Guarantor as
an Unrestricted Subsidiary; or




     (D) the Issuer exercising its Legal Defeasance option in accordance with
Article 8 or the Issuer’s obligations under this Indenture being discharged in
accordance with the terms of this Indenture; and




     (2) (E) such Guarantor delivering to the Trustee an Officers’ Certificate and an
Opinion of Counsel, each stating that all conditions precedent provided for in this
Indenture relating to such transaction have been complied with.



          (b) At the request of the Issuer, the Trustee shall execute and deliver an appropriate
instrument evidencing the termination of the applicable Notes Guarantee.



ARTICLE 12




SECURITY ARRANGEMENTS



Section 12.01 Security.




          (a) In order to secure the Obligations of the Issuer under this Indenture and the Notes, the
Issuer will execute and deliver to the Trustee on or prior to the Issue Date each Collateral
Document to which it is or is to be a party that is intended to be effective upon the Issue Date
and create the Second-Priority Liens intended to be created thereunder, with the priority set forth
therein and in the Intercreditor Agreements, on the Collateral. In order to secure the Obligations
of each Guarantor under its Notes Guarantee, this Indenture and the Notes, each Guarantor will
execute and deliver to the Trustee on or prior to the Issue Date each Collateral Document to which
it is or is to be a party that is intended to be effective upon the Issue Date and create the
Second-Priority Liens intended to be created thereunder, with the priority set forth therein and in
the Intercreditor Agreements, on the Collateral. The Issuer shall cause all such Liens to be
perfected within 10 days of the Issue Date. For avoidance of doubt, on the Issue Date, the
Excluded Assets will not be Collateral. The Issuer, Parent and the other Guarantors will use their
commercially reasonable efforts consistent with industry practice not to enter into any agreement
that would exclude the rights referred to in clause (4) of the definition of Excluded Assets from
the Collateral in the future.



          (b) If property (other than Excluded Assets) is acquired by the Issuer or a Guarantor that is
not automatically subject to a perfected security interest under the Collateral Documents or a
Subsidiary of Parent or the Issuer becomes a Guarantor under this Indenture (or any indenture
supplement), then the Issuer or such Guarantor will, as soon as practical (and in any event within
10 Business Days) after such property’s acquisition or it no longer being an Excluded Asset or such
Subsidiary becoming a Guarantor, as applicable, provide security over such property (or, in the
case of a new Guarantor, all of its assets that are Collateral) in favor of the Collateral Agent on
a basis that would provide a Second-Priority Lien on such terms, in each case, consistent with the
Collateral Documents in effect on the Issue Date, and take such additional actions (including any
of the actions described in Section 4.19) as the Collateral Agent may deem reasonable and
appropriate or advisable to create and fully perfect in favor of the secured parties under the
Collateral Documents a valid and enforceable security interest in such Collateral, which shall be
free of all other Liens except for Permitted Liens. In addition, with respect to any assets of the
Issuer or any Guarantor that in the future are subject to a Lien with respect to the obligations
under the Senior Credit Facility (or the Notes Guarantees thereof by any of the Guarantors) and are
not already subject to a perfected security interest under the Collateral Documents, the Issuer or
such Guarantor shall as soon as practicable (and in any event within 10 Business Days) make such
assets subject to the security interest under the Collateral Documents in favor of the Collateral
Agent.



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Any security interest provided pursuant to this Section 12.01(b) shall be accompanied by such
Opinions of Counsel to the Issuer or the Guarantors addressed to the Trustee and the Collateral
Agent as are customarily given by such counsel in the relevant jurisdiction, in form and substance
customary for such jurisdiction, provided, however, that no such opinion shall be
required to be delivered if the fair market value of Collateral subject to such security interest
is less than $1,000,000 (as certified in an Officers’ Certificate to the Trustee and the Collateral
Agent). In addition, the Issuer shall deliver an Officers’ Certificate to the Collateral Agent
certifying that the necessary measures have been taken to perfect the security interest in such
property.




          (c) Within 90 days of the purchase by the Issuer or the Guarantors of any after acquired
property constituting owned real property in which a security interest is required to be granted to
the Collateral Agent pursuant to Section 12.01(b), the Issuer shall furnish and deliver to the
Trustee and the Collateral Agent (i) an executed mortgage with respect to such real property, (ii)
an Opinion of Counsel stating that, in the opinion of such counsel, all action has been taken with
respect to the recording, registering and filing of such mortgage, financing statements and other
instruments as is necessary to make effective the Liens intended to be created on such real
property and to perfect the Liens and reciting with respect to the security interests in such
Collateral, the details of such action; (iii) a title insurance policy for the benefit of the
Collateral Agent in the amount of 120% of the Fair Market Value of such real property with extended
coverage covering the real property as well as a current ALTA survey thereof, together with a
surveyor’s certificate unless the title insurance policy referred to above shall not contain an
exception for any matter shown by a survey (except to the extent an existing survey has been
provided and specifically incorporated into such title insurance policy), each in form and
substance reasonably satisfactory to the Collateral Agent; (iv) any customary consents or estoppels
in connection with such mortgage and reasonably obtainable by the Issuer or the Guarantors, each of
the foregoing in form and substance reasonably satisfactory to the Collateral Agent.



          (d) The Issuer and the Guarantors shall comply with all covenants and agreements contained in
the Collateral Documents.



          (e) Each Holder, by accepting a Note, agrees to all of the terms and provisions of the
Collateral Documents, as the same may be amended from time to time pursuant to the provisions of
this Indenture and the Collateral Documents.



          (f) As among the Holders, the Collateral as now or hereafter constituted shall be held for the
equal and ratable benefit of the Holders without preference, priority or distinction of any thereof
over any other by reason of differences in time of issuance, sale or otherwise, as security for the
Obligations under this Indenture, the Notes and the Notes Guarantees.



          (g) The Issuer will comply with Section 314(b) of the Trust Indenture Act, relating to annual
opinions as to the validity of the Liens securing the Notes and the Notes Guarantees, but shall not
be subject to Section 314(d) of the Trust Indenture Act, relating to the delivery of certain
certificates and reports in connection with the release of property and to the substitution
therefor of any property to be pledged as Collateral for the Notes and the Notes Guarantees.



Section 12.02 Authorization of Actions to Be Taken.




          (a) Each Holder of a Note, by its acceptance thereof, is deemed to have authorized, directed
and empowered the Trustee to enter into the Collateral Documents, whether as Trustee or Collateral
Agent, and to receive for the benefit of the Holders of Notes any funds collected or distributed
under the Collateral Documents to which the Trustee or the Collateral Agent is a party and to make
further distributions of such funds to the Holders of Notes according to the provisions of this
Indenture. If, at any time any Intercreditor Agreement ceases to be in effect (or with respect to
a portion of the



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Collateral) because the First-Priority Obligations are no longer outstanding or no longer
secured by Liens on all or a portion of the Collateral and, thereafter, the Issuer or any Guarantor
subsequently incurs Obligations under a new Credit Facility or other Obligations that are to be
secured by first-priority or other senior Liens on assets of the Issuer or any Guarantor of the
type constituting Collateral (which first-priority or other senior basis is permitted under this
Indenture), the Trustee and the Collateral Agent are hereby authorized, directed and empowered to
enter into a new intercreditor agreement that provides the representative under such Credit
Facility or other Obligations substantially the same rights and powers as afforded under the
applicable Intercreditor Agreement. For the avoidance of doubt, the Trustee and the Collateral
Agent are authorized, directed and empowered to enter into any laboratory pledgeholder agreement,
laboratory access letter or other ancillary Collateral Document that provides property to be
pledged as Collateral for the Notes and the Notes Guarantees.




          (b) Subject to the provisions of Article 7 and the Intercreditor Agreements, the Trustee, in
its sole discretion and without the consent of the Holders of Notes, may, or at the direction of
the Holders of a majority in principal amount of the Notes then outstanding, the Trustee shall,
direct on behalf of the Holders of Notes, the Collateral Agent to take all actions it deems
necessary or appropriate in order to:




     (1) during the existence of an Event of Default, foreclose upon and take possession of
all Collateral pursuant to, or take any other action to enforce, the provisions of the
Collateral Documents;




     (2) enforce any of the terms of the Intercreditor Agreements and the Collateral
Documents to which the Trustee or the Collateral Agent is a party; or




     (3) collect and receive payment of all obligations in respect of the Notes, the Notes
Guarantees and this Indenture.


Subject to the provisions of the Intercreditor Agreements and Article 7, the Trustee and the
Collateral Agent is authorized and empowered to institute and maintain such suits and proceedings
as it may deem expedient to protect or enforce the Liens on the Collateral or the other rights
under the Collateral Documents to which the Trustee or the Collateral Agent is a party or to
prevent any impairment of Collateral by any acts that may be unlawful or in violation of such
Collateral Documents or this Indenture, and such suits and proceedings as the Trustee or the
Collateral Agent may deem expedient to preserve or protect its interests and the interests of the
Holders in the Collateral, including power to institute and maintain suits or proceedings to
restrain the enforcement of or compliance with any legislative or other governmental enactment,
rule or order that may be unconstitutional or otherwise invalid if the enforcement of, or
compliance with, such enactment, rule or order would impair the Liens or other rights under such
Collateral Documents or hereunder or be prejudicial to the interests of Holders or the Trustee.




Section 12.03 Determinations Relating to Collateral.




          In the event (a) the Trustee shall receive any written request from the Issuer, a Guarantor or
the Collateral Agent under any Collateral Document for consent or approval with respect to any
matter or thing relating to any Collateral or the Issuer’s or such Guarantor’s obligations with
respect thereto, (b) there shall be due to or from the Trustee or the Collateral Agent under the
provisions of any Collateral Document any material performance or the delivery of any material
instrument or (c) the Trustee shall become aware of any nonperformance by the Issuer or a Guarantor
of any covenant or any breach of any representation or warranty of the Issuer or such Guarantor set
forth in any Collateral Document, then, in each such event, the Trustee shall be entitled to hire
experts, consultants, agents and attorneys to advise the Trustee on the manner in which the Trustee
should respond, or direct the Collateral Agent to respond,



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to such request or render any requested performance or respond, or direct the Collateral Agent
to respond, to such nonperformance or breach; provided that the Trustee’s right to direct
the Collateral Agent to respond shall be subject to the terms of the Collateral Documents. The
Trustee shall be fully protected in the taking of any action recommended or approved by any such
expert, consultant, agent or attorney or agreed to by the Holders of a majority in principal amount
of the outstanding Notes.




Section 12.04 Release of Liens.




          (a) The Second-Priority Liens on the Collateral securing the Notes will be automatically
released:




     (1) in respect of any Collateral owned by a Guarantor whose Notes Guarantee was
released pursuant to Section 11.06, upon the release of such Notes Guarantee of such
Guarantor pursuant to Section 11.06;




     (2) upon the Issuer exercising its Legal Defeasance option under Section 8.02;




     (3) upon payment in full of principal, interest and all other Obligations on the Notes
issued under this Indenture;




     (4) with the consent of the requisite Holders of the Notes in accordance with the
provisions under Article 9, including, without limitation, consents obtained in connection
with a tender offer or exchange offer for, or purchase of, Notes;




     (5) in connection with any disposition of Collateral to any person other than the
Issuer, any Restricted Subsidiary or any Guarantor (but excluding any transaction subject to
Article 5 where the recipient is required to become the obligor on the Notes or a Guarantor)
that is permitted under this Indenture (with respect to the Lien on such Collateral); and




     (6) upon the sale or disposition of any Collateral pursuant to the exercise of any
rights and remedies by the Administrative Agent or any other Person with respect to any
Collateral securing the First-Priority Obligations or the commencement or prosecution of
enforcement by the holders of First-Priority Obligations of any of the rights and remedies
under the First-Priority Documents or applicable law, including without limitation the
exercise of any rights of set-off or recoupment.



          (b) Upon delivery to the Trustee by the Issuer or the Issuer of an Officers’ Certificate
requesting execution of an instrument confirming the release of the Liens pursuant to Section
12.04(a), accompanied by:




     (1) an Opinion of Counsel confirming that such release is permitted by Section
12.04(a);




     (2) all instruments requested by the Issuer to effectuate or confirm such release; and




     (3) such other certificates and documents as the Trustee may reasonably request to
confirm the matters set forth in Section 12.04(a),


the Trustee will, if such instruments and confirmation are reasonably satisfactory to the Trustee,
promptly execute and deliver, such instruments.







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          (c) All instruments effectuating or confirming any release of any Liens will have the effect
solely of releasing such Liens as to the Collateral described therein, on customary terms and
without any recourse, representation, warranty or liability whatsoever.




          (d) The Issuer will bear and pay all reasonable costs and expenses associated with any release
of Liens pursuant to this Section 12.04, including all reasonable fees and disbursements of any
attorneys or representatives acting the Trustee or for the Collateral Agent.



Section 12.05 Agreement for the Benefit of Holders of First-Priority Liens.





          (a) The Liens on the Collateral are, to the extent and in the manner provided in the
Intercreditor Agreements, subject to and subordinate in ranking to all present and future Liens on
the Collateral with a First-Priority Lien; and the Intercreditor Agreements will be enforceable by
the holders of such First-Priority Liens, for the benefit of the holders of Obligations secured
thereby, until the satisfaction pursuant to the terms thereof of all such Obligations outstanding
at the time of such release.




          (b) Without the necessity of any consent of the Trustee, the Collateral Agent or any Holder of
the Notes, the holders of the First-Priority Obligations may change, waive, modify or vary any
Collateral Documents relating to Collateral, subject to the limitations set forth in the
Intercreditor Agreements; provided that the Trustee and the Collateral Agent shall be given
prompt written notice of any such change, waiver, modification or variance.




          (c) As among the Trustee, the Collateral Agent and the Holders of the Notes, on one hand, and
the holders of the First-Priority Obligations, on the other hand, the holders of the First-Priority
Obligations will have the sole ability to control and obtain remedies with respect to all
Collateral without the necessity of any consent or of any notice to the Trustee, the Collateral
Agent or any such Holder, subject to the limitations set forth in the Intercreditor Agreements.



Section 12.06 Notes and Notes Guarantees Not Subordinated.





          The provisions of Section 12.05 are intended solely to set forth the relative ranking, as
Liens, of the Liens on the Collateral securing the Notes and the Notes Guarantees as against the
Liens on the Collateral securing the First-Priority Obligations. The Notes and (except as set
forth in any Intercreditor Agreements) the Notes Guarantees are senior unsubordinated obligations
of the Issuer and the Guarantors. Neither the Notes and the Notes Guarantees nor the exercise or
enforcement of any right or remedy for the payment or collection thereof (other than the exercise
of rights and remedies in respect of the Collateral, which are subject to the Intercreditor
Agreements) are intended to be, or will ever be by reason of the provisions of Section 12.05, in
any respect subordinated, deferred, postponed, restricted or prejudiced.



Section 12.07 Limitation on Duty of Trustee in Respect of Collateral.





          (a) Beyond the exercise of reasonable care in the custody thereof, the Trustee and the
Collateral Agent shall have no duty as to any Collateral in its possession or control or in the
possession or control of any agent or bailee or any income thereon or as to preservation of rights
against prior parties or any other rights pertaining thereto and neither the Trustee nor the
Collateral Agent shall not be responsible for filing any financing or continuation statements or
recording any documents or instruments in any public office at any time or times or otherwise
perfecting or maintaining the perfection of any security interest in the Collateral. The Trustee
and the Collateral Agent shall be deemed to have exercised reasonable care in the custody of the
Collateral in its possession if the Collateral is accorded treatment substantially equal to that
which it accords its own property and shall not be liable or responsible for any loss or diminution
in the value of any of the Collateral, by reason of the act or



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omission of any carrier, forwarding agency or other agent or bailee selected by the Trustee or
the Collateral Agent in good faith.





          (b) The Trustee and the Collateral Agent shall not be responsible for the existence,
genuineness or value of any of the Collateral or for the validity, perfection, priority or
enforceability of the Liens on any of the Collateral, whether impaired by operation of law or by
reason of any action or omission to act on its part hereunder, except to the extent such action or
omission constitutes gross negligence or willful misconduct on the part of the Trustee or the
Collateral Agent, for the validity or sufficiency of the Collateral or any agreement or assignment
contained therein, for the validity of the title of the Issuer or the Guarantors to the Collateral,
for insuring the Collateral or for the payment of taxes, charges, assessments or Liens upon the
Collateral or otherwise as to the maintenance of the Collateral. The Trustee and the Collateral
Agent shall have no duty to ascertain or inquire as to the performance or observance of any of the
terms of this Indenture or any of the Collateral Documents.



Section 12.08 Additional Intercreditor Agreements.




          If any Indebtedness permitted to be incurred under this Indenture is secured by First-Priority
Liens permitted to be Incurred under this Indenture, the Collateral Agent shall, upon receipt of an
Officers’ Certificate and an Opinion of Counsel, enter into an Intercreditor Agreement with the
representative of the holders of such Indebtedness and the Administrative Agent with terms
substantially similar to the Intercreditor Agreements in existence on the Issue Date.



ARTICLE 13




SATISFACTION AND DISCHARGE



Section 13.01 Satisfaction and Discharge.




          (a) This Indenture will be discharged and will cease to be of further effect as to all Notes
when either:




     (1) all Notes theretofore authenticated and delivered (except lost, stolen or destroyed
Notes which have been replaced or paid and Notes for whose payment money has theretofore
been deposited in trust) have been delivered to the Trustee for cancellation; or




     (2) (A) all Notes not theretofore delivered to the Trustee for cancellation have become
due and payable by reason of the making of a notice of redemption or otherwise, will become
due and payable within one year or may be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the Issuer, and the Issuer or any Guarantor has
irrevocably deposited or caused to be deposited with the Trustee, as trust funds in trust
solely for the benefit of the Holders of the Notes, cash in U.S. dollars, Government
Securities, or a combination thereof, in such amounts as will be sufficient without
consideration of any reinvestment of interest to pay and discharge the entire Indebtedness
on the Notes not theretofore delivered to the Trustee for cancellation for principal,
premium, if any, and accrued interest to the date of maturity or redemption, as the case may
be;




     (B) no Default or Event of Default with respect to this Indenture or the Notes
shall have occurred and be continuing on the date of such deposit (other than a
Default resulting from borrowing funds to be applied to make such deposit and any
similar and simultaneous deposit relating to other Indebtedness and, in each case,
the granting of Liens in connection therewith) and such deposit will not result in a
breach or violation of,



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or constitute a default under the Senior Credit Facility or any other material
agreement or instrument to which the Issuer or any Guarantor is a party or by which
the Issuer or any Guarantor is bound;




     (C) the Issuer has paid or caused to be paid all sums payable by it under this
Indenture; and




     (D) the Issuer has delivered irrevocable instructions to the Trustee to apply
the deposited money toward the payment of the Notes at maturity or the redemption
date, as the case may be.



          (b) In addition, the Issuer must deliver an Officers’ Certificate and an Opinion of Counsel to
the Trustee stating that all conditions precedent to satisfaction and discharge have been
satisfied. Notwithstanding the satisfaction and discharge of this Indenture, if money shall have
been deposited with the Trustee pursuant to subclause (a) of clause (2) of this Section 13.01, the
provisions of Section 13.02 and Section 8.06 shall survive.



Section 13.02 Application of Trust Money.




          (a) Subject to the provisions of Section 8.06, all money deposited with the Trustee pursuant
to Section 13.01 shall be held in trust and applied by it, in accordance with the provisions of the
Notes and this Indenture, to the payment, either directly or through any Paying Agent (including
the Issuer acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled
thereto, of the principal, premium, if any, and interest for whose payment such money has been
deposited with the Trustee; but such money need not be segregated from other funds except to the
extent required by law.



          (b) If the Trustee or Paying Agent is unable to apply any money or Government Securities in
accordance with Section 13.01 by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting
such application, the Issuer’s and any Guarantor’s obligations under this Indenture and the Notes
shall be revived and reinstated as though no deposit had occurred pursuant to Section 13.01;
provided that if the Issuer has made any payment of principal of or premium, if any, or
interest on any Notes because of the reinstatement of its obligations, the Issuer shall be
subrogated to the rights of the Holders of such Notes to receive such payment from the money or
Government Securities held by the Trustee or Paying Agent.



ARTICLE 14




MISCELLANEOUS



Section 14.01 Trust Indenture Act Controls.




          If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by
Trust Indenture Act Section 318(c), the imposed duties shall control.



Section 14.02 Notices.




          (a) Any notice or communication by the Issuer, any Guarantor or the Trustee to the others is
duly given if in writing and (1) delivered in person, (2) mailed by first-class mail (certified or
registered, return receipt requested) or overnight air courier guaranteeing next day delivery or
(3) sent by facsimile or electronic transmission, to the others’ addresses:



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If to Parent, the Issuer and/or any Guarantor:



c/o Lions Gate Entertainment Inc.

2700 Colorado Avenue, Suite 200

Santa Monica, California 90404

Fax No.: (310) 452-8934

Attention: Wayne Levin, EVP Corporate Operations & General Counsel



With a copy to:

O’Melveny & Myers LLP

1999 Avenue of the Stars, 7th Floor

Los Angeles, California 90067

Fax No: (310) 246-6779

Attention: David J. Johnson, Jr.



If to the Trustee:

c/o U.S. Bank Corporate Trust Services

633 West Fifth Street, 24th Floor

Los Angeles, California 90071

Fax No.: (213) 615-6197

Attention: Paula Oswald



With a copy to:

McGuireWoods LLP

7 Saint Paul Street, Suite 1000

Baltimore, Maryland 21202

Fax No: (410) 659-4479

Attention: Jennifer J. Stearman



The Issuer, any Guarantor or the Trustee, by notice to the others, may designate additional or
different addresses for subsequent notices or communications.




          (b) All notices and communications (other than those sent to Holders) shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; on the first date of which
publication is made if by publication; five calendar days after being deposited in the mail,
postage prepaid, if mailed by first-class mail; the next Business Day after timely delivery to the
courier, if mailed by overnight air courier guaranteeing next day delivery; when receipt
acknowledged, if sent by facsimile or electronic transmission; provided that any notice or
communication delivered to the Trustee shall be deemed effective upon actual receipt thereof.



          (c) Any notice or communication to a Holder shall be mailed by first-class mail (certified or
registered, return receipt requested) or by overnight air courier guaranteeing next day delivery to
its address shown on the Note Register or by such other delivery system as the Trustee agrees to
accept. Any notice or communication shall also be so mailed to any Person described in Trust
Indenture Act Section 313(c), to the extent required by the Trust Indenture Act. Failure to mail a
notice or communication to a Holder or any defect in it shall not affect its sufficiency with
respect to other Holders.



          (d) Where this Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after the event, and such



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waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed
with the Trustee, but such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.




          (e) Where this Indenture provides for notice of any event to a Holder of a Global Note, such
notice shall be sufficiently given if given to the Depositary for such Note (or its designee),
pursuant to the applicable procedures of such Depositary, if any, prescribed for the giving of such
notice.



          (f) The Trustee agrees to accept and act upon notice, instructions or directions pursuant to
this Indenture sent by unsecured facsimile or electronic transmission; provided,
however, that (1) the party providing such written notice, instructions or directions,
subsequent to such transmission of written instructions, shall provide the originally executed
instructions or directions to the Trustee in a timely manner, and (2) such originally executed
notice, instructions or directions shall be signed by an authorized representative of the party
providing such notice, instructions or directions. The Trustee shall not be liable for any losses,
costs or expenses arising directly or indirectly from the Trustee’s reasonable reliance upon and
compliance with such notice, instructions or directions notwithstanding such notice, instructions
or directions conflict or are inconsistent with a subsequent notice, instructions or directions.



          (g) If a notice or communication is sent in the manner provided above within the time
prescribed, it is duly given, whether or not the addressee receives it.



          (h) If the Issuer mails a notice or communication to Holders, it shall mail a copy to the
Trustee and each Agent at the same time.



Section 14.03 Communication by Holders with Other Holders.




          Holders may communicate pursuant to Trust Indenture Act Section 312(b) with other Holders with
respect to their rights under this Indenture or the Notes. The Issuer, the Trustee, the Registrar
and anyone else shall have the protection of Trust Indenture Act Section 312(c).



Section 14.04 Certificate and Opinion as to Conditions Precedent.




          Upon any request or application by the Issuer or any Guarantor to the Trustee to take any
action under this Indenture, the Issuer or such Guarantor, as the case may be, shall furnish to the
Trustee:




     (1) an Officers’ Certificate in form and substance reasonably satisfactory to the
Trustee (which shall include the statements set forth in Section 14.05) stating that, in the
opinion of the signer(s), all conditions precedent and covenants, if any, provided for in
this Indenture relating to the proposed action have been satisfied; and




     (2) an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee
(which shall include the statements set forth in Section 14.05) stating that, in the opinion
of such counsel, all such conditions precedent and covenants have been complied with;
provided that (A) subject to Section 4.17 and Section 5.01(c), no Opinion of Counsel
shall be required in connection with the addition of a Guarantor under this Indenture upon
execution and delivery by such Guarantor and the Trustee of a supplemental indenture to this
Indenture, the form of which is attached as Exhibit C and (B) no Opinion of Counsel shall be
required in connection with the issuance of Notes on the Issue Date.




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Section 14.05 Statements Required in Certificate or Opinion.




          Each certificate or opinion with respect to compliance with a condition or covenant provided
for in this Indenture (other than a certificate provided pursuant to Section 4.04) shall include:





     (1) a statement that the Person making such certificate or opinion has read such
covenant or condition;




     (2) a brief statement as to the nature and scope of the examination or investigation
upon which the statements or opinions contained in such certificate or opinion are based;




     (3) a statement that, in the opinion of such Person, he or she has made such
examination or investigation as is necessary to enable him or her to express an informed
opinion as to whether or not such covenant or condition has been complied with (and, in the
case of an Opinion of Counsel, may be limited to reliance on an Officers’ Certificate as to
matters of fact); and




     (4) a statement as to whether or not, in the opinion of such Person, such condition or
covenant has been complied with.



Section 14.06 Rules by Trustee and Agents.




          The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar
or Paying Agent may make reasonable rules and set reasonable requirements for its functions.




Section 14.07 No Personal Liability of Directors, Officers, Employees and Stockholders.




          No director, Officer, employee, incorporator or stockholder of the Issuer or the Guarantors,
as such, shall have any liability for any obligations of the Issuer under the Notes, this Indenture
or the Notes Guarantees or for any claim based on, in respect of, or by reason of, such obligations
or their creation.




          Each Holder by accepting a Note waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Notes.




Section 14.08 Governing Law.




          THIS INDENTURE, THE NOTES AND ANY GUARANTEE WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.




Section 14.09 Waiver of Jury Trial.




          EACH OF THE ISSUER, THE GUARANTORS AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTIONS CONTEMPLATED HEREBY.




Section 14.10 Force Majeure.




          In no event shall the Trustee be responsible or liable for any failure or delay in the
performance of its obligations under this Indenture arising out of or caused by, directly or
indirectly, forces beyond its reasonable control, including without limitation strikes, work
stoppages, accidents, acts






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of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts
of God, and interruptions, loss or malfunctions of utilities, communications or computer (software
or hardware) services; it being understood that the Trustee shall use reasonable efforts which are
consistent with accepted practices in the banking industry to resume performance as soon as
practicable under the circumstances.




Section 14.11 No Adverse Interpretation of Other Agreements.




          This Indenture may not be used to interpret any other indenture, loan or debt agreement of the
Issuer or its Restricted Subsidiaries or of any other Person. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.




Section 14.12 Successors.




          All agreements of the Issuer in this Indenture and the Notes shall bind its successors. All
agreements of the Trustee in this Indenture shall bind its successors. All agreements of each
Guarantor in this Indenture shall bind its successors, except as otherwise provided in Section
11.06.




Section 14.13 Severability.




          In case any provision in this Indenture or in the Notes shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.




Section 14.14 Counterpart Originals.




          The parties may sign any number of copies of this Indenture. Each signed copy shall be an
original, but all of them together represent the same agreement.




Section 14.15 Table of Contents, Headings, etc.




          The Table of Contents, Cross-Reference Table and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not to be considered a part of
this Indenture and shall in no way modify or restrict any of the terms or provisions hereof.




Section 14.16 U.S.A. PATRIOT Act.




          To help the government fight the funding of terrorism and money laundering activities, federal
law requires all financial institutions to obtain, verify and record information that identifies
each person who opens an account. For a non-individual person such as a business entity, a
charity, a trust or other legal entity the Trustee will ask for documentation to verify its
formation and existence as a legal entity. The Trustee may also ask to see financial statements,
licenses, identification and authorization documents from individuals claiming authority to
represent the entity or other relevant documentation. The parties each agree to provide all such
information and documentation as to themselves as requested by the Trustee to ensure compliance
with federal law.




Section 14.17 Consent to Jurisdiction; Appointment of Agent for Service of Process.




          Parent and each Parent Subsidiary Guarantor, jointly and severally, agrees that:




          (a) Any suit, action or proceeding against Parent or any Parent Subsidiary Guarantor arising
out of or relating to this Indenture, the Notes, the Notes Guarantees and the Collateral Documents
may be instituted in any state or U.S. Federal court in the Borough of Manhattan, The City of New
York,






-121-









 







New York, and any appellate court from any thereof, and Parent and each Parent Subsidiary
Guarantor irrevocably submits to the non-exclusive jurisdiction of such courts in any suit, action
or proceeding. Parent and each Parent Subsidiary Guarantor irrevocably waives, to the fullest
extent permitted by law, any objection to any suit, action or proceeding that may be brought in
connection with this Indenture, the Notes, the Notes Guarantees and the Collateral Documents,
including such actions, suits or proceedings relating to the securities laws of the United States
of America or any state thereof, in such courts whether on the grounds of venue, residence or
domicile or on the ground that any such suit, action or proceeding has been brought in an
inconvenient forum. The final judgment in any such suit, action or proceeding brought in such
court shall be conclusive and binding upon Parent or any Parent Subsidiary Guarantor and may be
enforced in any court to the jurisdiction of which Parent or any Parent Subsidiary Guarantor is
subject by a suit upon such judgment; provided that service of process is effected upon Parent or
any Parent Subsidiary Guarantor in the manner provided by this Section 14.17.




          (b) Parent and each Parent Subsidiary Guarantor has appointed the Issuer as its Authorized
Agent, upon whom process may be served in any suit, action or proceeding arising out of or relating
to this Indenture, the Notes, the Notes Guarantees and the Collateral Documents or the transactions
contemplated herein which may be instituted in any state or U.S. Federal court in the Borough of
Manhattan, The City of New York, New York, and expressly accepts the non-exclusive jurisdiction of
any such court in respect of any such suit, action or proceeding. The Issuer has accepted such
appointment and has agreed to act as said agent for service of process. Service of process upon
the Authorized Agent shall be deemed, in every respect, effective service of process upon the
Issuer and any Non-U.S. Guarantor. Notwithstanding the foregoing, any action involving the Parent
and any Parent Subsidiary Guarantor arising out of or relating to this Indenture, the Notes, the
Notes Guarantees and the Collateral Documents may be instituted in any court of competent
jurisdiction in any other jurisdiction.




Section 14.18 Judgment Currency.




          If for the purposes of obtaining judgment in any court it is necessary to convert a sum due
hereunder into any currency other than United States dollars, the parties hereto agree, to the
fullest extent permitted by law, that the rate of exchange used shall be the rate at which in
accordance with normal banking procedures the Trustee could purchase United States dollars with
such other currency in The City of New York on the Business Day preceding that on which final
judgment is given. The obligation of Parent, the Issuer and each Guarantor with respect to any sum
due from it to the Trustee and the Holders shall, notwithstanding any judgment in a currency other
than United States dollars, not be discharged until the first Business Day following receipt by the
Trustee or the Holders of any sum in such other currency, and only to the extent that the Trustee
may in accordance with normal banking procedures purchase United States dollars with such other
currency. If the United States dollars so purchased are less than the sum originally due to the
Trustee or the Holders, Parent, the Issuer and the Guarantors, jointly and severally, to the extent
permitted by law, agree as a separate obligation and notwithstanding any such judgment, to
indemnify the Trustee and such Holders against such loss. If the United States dollars so
purchased are greater than the sum originally due to the Trustee or the Holders, the Trustee and
the Holders hereby agrees to pay to the Issuer an amount equal to the excess of the dollars so
purchased over the sum originally due to such person.




[Signatures on following page]






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	 	LIONS GATE ENTERTAINMENT INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



[Signature Page to Indenture]





 









 








	 	 	 	 	 
	 	LIONS GATE ENTERTAINMENT CORP.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



[Signature Page to Indenture]








 









 








	 	 	 	 	 
	 	ALL ABOUT US PRODUCTIONS INC.


ARIMA, INC.


ARTISAN ENTERTAINMENT INC.


ARTISAN FILMED PRODUCTIONS INC.


ARTISAN HOME ENTERTAINMENT INC.


ARTISAN PICTURES INC.


ARTISAN RELEASING INC.


BACKSEAT PRODUCTIONS, LLC


BASTER PRODUCTIONS, LLC


BD OPTICAL MEDIA, INC.


BLAIR WITCH FILM PARTNERS LTD.


BLUE MOUNTAIN STATE PRODUCTIONS CORP.


BURROWERS PRODUCTIONS, INC.


CRASH 2 TELEVISION PRODUCTIONS, INC.


CRASH TELEVISION PRODUCTIONS, INC.


CUPID PRODUCTIONS, INC.


DANCING ELK PRODUCTIONS, LLC


DEAD ZONE PRODUCTION CORP.


DEBMAR STUDIOS, INC.


DEBMAR/MERCURY (WW) PRODUCTIONS LLC


DEBMAR/MERCURY, LLC


DJM SERVICES, INC.


DRESDEN FILES PRODUCTIONS CORP.


DRESDEN FILES PRODUCTIONS I CORP.


FEAR ITSELF PRODUCTIONS CORP.


FILM HOLDINGS CO.


FIVE DAYS PRODUCTION CORP.


GC FILMS, INC.


GC SHORT FILMS, INC.


HEART FRANK, INC.


HIGHER POST LLC


HORSEMEN PRODUCTIONS, LLC


INVISIBLE CASTING INC.


ISH PROJECTS, LLC


ISH TELEVISION DEVELOPMENT, LLC


IWC PRODUCTIONS, LLC


JV1 ISH, LLC


KILL PIT PRODUCTIONS INC.


LANDSCAPE ENTERTAINMENT CORP.


LG HORROR CHANNEL HOLDINGS, LLC


LG PICTURES INC.


LIONS GATE ENTERTAINMENT CORP.


LIONS GATE FILMS INC.


LIONS GATE FILMS PRODUCTIONS CORP./


    PRODUCTIONS FILMS LIONS GATE S.A.R.F.


LIONS GATE INDIA, INC.


LIONS GATE MANDATE FINANCING VEHICLE INC.


LIONS GATE MUSIC CORP.


LIONS GATE MUSIC PUBLISHING LLC


LIONS GATE MUSIC, INC.

 	 



[Signature Page to Indenture]





 









 








	 	 	 	 	 
	 	LIONS GATE ONLINE SHOP INC.


LIONS GATE PENNSYLVANIA, INC.


LIONS GATE RECORDS, INC.


LIONS GATE SPIRIT HOLDINGS, LLC


LIONS GATE TELEVISION DEVELOPMENT, LLC


LIONS GATE TELEVISION INC.


LIONS GATE X PRODUCTIONS, LLC


LUCKY 7 PRODUCTIONS CORP.



MANDATE FILMS, LLC



MANDATE INTERNATIONAL, LLC


MANDATE PICTURES LLC


MOTHER PRODUCTIONS CORP.


MQP, LLC


NGC FILMS, INC.


NURSE PRODUCTIONS, INC.


PEARL RIVER HOLDINGS CORP.


PGH PRODUCTIONS, INC.


PLANETARY PRODUCTIONS, LLC


PLAYLIST, LLC


POWER MONGERING DESPOT, INC.


PRODUCTION MANAGEMENT INC.


PROFILER PRODUCTIONS CORP.


PSYCHO PRODUCTIONS SERVICES CORP.


R & B PRODUCTIONS, INC


SCREENING ROOM, INC.


SILENT DEVELOPMENT CORP.


SKILLPA PRODUCTIONS, LLC


SS3 PRODUCTIONS, INC.


TALK PRODUCTIONS CORP.


TED PRODUCTIONS, INC.


TERRESTRIAL PRODUCTIONS CORP.


TOUCH PRODUCTIONS CORP.


U.R.O.K. PRODUCTIONS, INC.

VERDICT PRODUCTIONS, INC.


VESTRON INC.

WEEDS PRODUCTIONS INC.


WILDFIRE 2 PRODUCTIONS INC.


WILDFIRE 3 PRODUCTIONS INC.

WILDFIRE 4 PRODUCTIONS INC.


WILDFIRE PRODUCTIONS INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 



[Signature Page to Indenture]






 









 








	 	 	 	 	 
	 	U.S. BANK NATIONAL ASSOCIATION, as Trustee

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



[Signature Page to Indenture]







 









 








APPENDIX A




PROVISIONS RELATING TO INITIAL NOTES

AND ADDITIONAL NOTES



Section 1.1 Definitions.




          (a) Capitalized Terms.




          Capitalized terms used but not defined in this Appendix A have the meanings given to them in
this Indenture. The following capitalized terms have the following meanings:




          “Applicable Procedures” means, with respect to any transfer or transaction involving a
Regulation S Global Note or beneficial interest therein, the rules and procedures of the Depositary
for such Global Note, Euroclear and Clearstream, in each case to the extent applicable to such
transaction and as in effect from time to time.




          “Clearstream” means Clearstream Banking, Société Anonyme, or any successor securities
clearing agency.




          “Distribution Compliance Period”, with respect to any Note, means the period of 40
consecutive days beginning on and including the later of (a) the day on which such Note is first
offered to persons other than distributors (as defined in Regulation S under the Securities Act) in
reliance on Regulation S, notice of which day shall be promptly given by the Issuer to the Trustee,
and (b) the later of (x) the date of issuance with respect to such Note and (y) the last date on
which the Issuer or any Affiliate of the Issuer was the owner such Note.




          “Euroclear” means the Euroclear Clearance System or any successor securities clearing
agency.




          “IAI” means an institutional “accredited investor” as described in Rule 501(a)(1),
(2), (3) or (7) under the Securities Act.




          “QIB” means a “qualified institutional buyer” as defined in Rule 144A.




          “Regulation S” means Regulation S promulgated under the Securities Act.




          “Regulation S Notes” means all Notes offered and sold outside the United States of
America in reliance on Regulation S.




          “Rule 501” means Rule 501(a)(1), (2), (3) or (7) under the Securities Act.




          “Rule 144” means Rule 144 promulgated under the Securities Act.




          “Rule 144A” means Rule 144A promulgated under the Securities Act.




          “Rule 144A Notes” means all Notes offered and sold to QIBs in reliance on Rule 144A.




          “Rule 904” means Rule 904 promulgated under the Securities Act.




          “Unrestricted Global Note” means any Global Note that does not bear or is not required
to bear the Restricted Notes Legend.




          (b) Other Definitions.







1









 








	 	 	 	 	 
	Term:	 	Defined in Section:
	“Agent Members”

	 	 	2.1	(c)
	“Automatic Exchange”

	 	 	2.3	(d)
	“Automatic Exchange Date”

	 	 	2.3	(d)
	“Automatic Exchange Notice”

	 	 	2.3	(d)
	“Automatic Exchange Notice Date”

	 	 	2.3	(d)
	“Definitive Notes Legend”

	 	 	2.3	(f)
	“Global Note”

	 	 	2.1	(b)
	“Global Notes Legend”

	 	 	2.3	(f)
	“IAI Global Note”

	 	 	2.1	(b)
	“OID Notes Legend”

	 	 	2.3	(f)
	“Regulation S Global Note”

	 	 	2.1	(b)
	“Regulation S Notes”

	 	 	2.1	(a)
	“Restricted Global Note”

	 	 	2.3	(b)
	“Restricted Notes Legend”

	 	 	2.3	(f)
	“Rule 144A Notes”

	 	 	2.1	(a)
	“Rule 144A Global Note”

	 	 	2.1	(b)





Section 2.1 Form and Dating.




          (a) The Initial Notes issued on the date hereof shall be (i) offered and sold by the Issuer to
the Initial Purchasers and (ii) resold, initially only to (1) QIBs in reliance on Rule 144A
(“Rule 144A Notes”) and (2) Persons other than U.S. Persons (as defined in Regulation S) in
reliance on Regulation S (“Regulation S Notes”). Such Initial Notes may thereafter be
transferred to, among others, QIBs, purchasers in reliance on Regulation S and, except as set forth
below, IAIs in accordance with Rule 501.




          (b) Global Notes. Rule 144A Notes shall be issued initially in the form of one or
more permanent global Notes in definitive, fully registered form (collectively, the “Rule 144A
Global Note”) and Regulation S Notes shall be issued initially in the form of one or more
global Notes (collectively, the “Regulation S Global Note”), in each case without interest
coupons and bearing the Global Notes Legend and Restricted Notes Legend, which shall be deposited
on behalf of the purchasers of the Notes represented thereby with the Custodian, and registered in
the name of the Depositary or a nominee of the Depositary, duly executed by the Issuer and
authenticated by the Trustee as provided in this Indenture. One or more global Notes in
definitive, fully registered form without interest coupons and bearing the Global Notes Legend and
the Restricted Notes Legend (collectively, the “IAI Global Note”) shall also be issued on
the Issue Date, deposited with the Custodian, and registered in the name of the Depositary or a
nominee of the Depositary, duly executed by the Issuer and authenticated by the Trustee as provided
in this Indenture to accommodate transfers of beneficial interests in the Notes to IAIs subsequent
to the initial distribution. Beneficial ownership interests in the Regulation S Global Note shall
not be exchangeable for interests in the Rule 144A Global Note, the IAI Global Note or any other
Note without a Restricted Notes Legend until the expiration of the Distribution Compliance Period.
The Rule 144A Global Note, the IAI Global Note and the Regulation S Global Note are each referred
to herein as a “Global Note” and are collectively referred to herein as “Global
Notes”; provided that the term “Global Note” when used in Sections 2.1(c), 2.3(b),
2.3(g), 2.3(h)(i), 2.3(h)(ii) and 2.4 of this Appendix A and Section 2.06 of this Indenture shall
also include the Unrestricted Global Note. Each Global Note shall represent such of the
outstanding Notes as shall be specified in the “Schedule of Exchanges of Interests in the Global
Note” attached thereto and each shall provide that it shall represent up to the aggregate principal
amount of Notes from time to time endorsed thereon and that the aggregate principal amount of
outstanding Notes represented thereby may from time to time be reduced or increased, as applicable,
to reflect exchanges and redemptions. Any endorsement of a Global Note to reflect the






2









 







amount of any increase or decrease in the aggregate principal amount of outstanding Notes represented
thereby shall be made by the Trustee or the Custodian, at the direction of the Trustee, in
accordance with instructions given by the Holder thereof as required by Section 2.06 of the
Indenture and Section 2.3(c) below.




          (c) Book-Entry Provisions. This Section 2.1(c) shall apply only to a Global Note
deposited with or on behalf of the Depositary.




          The Issuer shall execute and the Trustee shall, in accordance with this Section 2.1(c) and
Section 2.2 and pursuant to an order of the Issuer signed by one Officer of the Issuer,
authenticate and deliver initially one or more Global Notes that (i) shall be registered in the
name of the Depositary for such Global Note or Global Notes or the nominee of such Depositary and
(ii) shall be delivered by the Trustee to such Depositary or pursuant to such Depositary’s
instructions or held by the Trustee as Custodian.




          Members of, or participants in, the Depositary (“Agent Members”) shall have no rights
under this Indenture with respect to any Global Note held on their behalf by the Depositary or by
the Trustee as Custodian or under such Global Note, and the Depositary may be treated by the
Issuer, the Trustee and any agent of the Issuer or the Trustee as the absolute owner of such Global
Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Issuer, the Trustee or any agent of the Issuer or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the Depositary or impair, as between the
Depositary and its Agent Members, the operation of customary practices of such Depositary governing
the exercise of the rights of a holder of a beneficial interest in any Global Note.




          (d) Definitive Notes. Except as provided in Section 2.3 or 2.4, owners of beneficial
interests in Global Notes shall not be entitled to receive physical delivery of certificated Notes.



Section 2.2 Authentication. The Trustee shall authenticate and make available for delivery
upon a written order of the Issuer signed by one Officer of the Issuer (a) Initial Notes for
original issue on the date hereof in an aggregate principal amount of $236,000,000, (b) subject to
the terms of this Indenture, Additional Notes and (c) the Unrestricted Global Notes for issue only
in accordance with Section 2.3(e). Such order shall specify the amount of the Notes to be
authenticated, the date on which the original issue of Notes is to be authenticated and whether the
Notes are to be Initial Notes, Additional Notes or Unrestricted Global Notes.



Section 2.3 Transfer and Exchange.




          (a) Transfer and Exchange of Definitive Notes for Definitive Notes. When Definitive
Notes are presented to the Registrar with a request:





     (i) to register the transfer of such Definitive Notes; or




     (ii) to exchange such Definitive Notes for an equal principal amount of Definitive
Notes of other authorized denominations,


the Registrar shall register the transfer or make the exchange as requested if its reasonable
requirements for such transaction are met; provided, however, that the Definitive
Notes surrendered for transfer or exchange:




3









 









     (1) shall be duly endorsed or accompanied by a written instrument of transfer in form
reasonably satisfactory to the Issuer and the Registrar, duly executed by the Holder thereof
or his attorney duly authorized in writing; and




     (2) in the case of Transfer Restricted Notes, are accompanied by the following
additional information and documents, as applicable:




     (A) if such Definitive Notes are being delivered to the Registrar by a Holder
for registration in the name of such Holder, without transfer, a certification from
such Holder to that effect (in the form set forth on the reverse side of the Initial
Note); or




     (B) if such Definitive Notes are being transferred to the Issuer, a
certification to that effect (in the form set forth on the reverse side of the
Initial Note); or




     (C) if such Definitive Notes are being transferred pursuant to an exemption
from registration in accordance with Rule 144 under the Securities Act or in
reliance upon another exemption from the registration requirements of the Securities
Act, (x) a certification to that effect (in the form set forth on the reverse side
of the Initial Note) and (y) if the Issuer so requests, an opinion of counsel or
other evidence reasonably satisfactory to them as to the compliance with the
restrictions set forth in the applicable legends set forth in Section 2.3(f)(i).



          (b) Restrictions on Transfer of a Definitive Note for a Beneficial Interest in a Global
Note. A Definitive Note may not be exchanged for a beneficial interest in a Global Note except
upon satisfaction of the requirements set forth below. Upon receipt by the Trustee of a Definitive
Note, duly endorsed or accompanied by a written instrument of transfer in form reasonably
satisfactory to the Issuer and the Registrar, together with:





     (i) (A) certification (in the form set forth on the reverse side of the Initial Note)
that such Definitive Note is being transferred (1) to a QIB in accordance with Rule 144A,
(2) to an IAI that has furnished to the Trustee a signed letter substantially in the form of
Exhibit B or (3) outside the United States of America in an offshore transaction
within the meaning of Regulation S and in compliance with Rule 904 under the Securities Act;
or (B) such other certification and Opinion of Counsel as the Trustee shall require; and




     (ii) written instructions directing the Trustee to make, or to direct the Custodian to
make, an adjustment on its books and records with respect to such Global Note to reflect an
increase in the aggregate principal amount of the Notes represented by the Global Note, such
instructions to contain information regarding the Depositary account to be credited with
such increase, then the Trustee shall cancel such Definitive Note and cause, or direct the
Custodian to cause, in accordance with the standing instructions and procedures existing
between the Depositary and the Custodian, the aggregate principal amount of Notes
represented by the Global Note to be increased by the aggregate principal amount of the
Definitive Note to be exchanged and shall credit or cause to be credited to the account of
the Person specified in such instructions a beneficial interest in the Global Note equal to
the principal amount of the Definitive Note so canceled. If no Global Notes are then
outstanding and the Global Note has not been previously exchanged for certificated
securities pursuant to Section 2.4, the Issuer shall issue and the Trustee shall
authenticate, upon written order of the Issuer in the form of an Officers’ Certificate, a
new Global Note in the appropriate principal amount.



4









 





          (c) Transfer and Exchange of Global Notes. (i) The transfer and exchange of Global
Notes or beneficial interests therein shall be effected through the Depositary, in accordance with
this Indenture (including applicable restrictions on transfer set forth herein, if any) and the
procedures of the Depositary therefor. A transferor of a beneficial interest in a Global Note
shall deliver a written order given in accordance with the Depositary’s procedures containing
information regarding the participant account of the Depositary to be credited with a beneficial interest in such Global Note or
another Global Note and such account shall be credited in accordance with such order with a
beneficial interest in the applicable Global Note and the account of the Person making the transfer
shall be debited by an amount equal to the beneficial interest in the Global Note being
transferred. Transfers by an owner of a beneficial interest in the Rule 144A Global Note or the
IAI Global Note to a transferee who takes delivery of such interest through the Regulation S
Global Note, whether before or after the expiration of the Distribution Compliance Period, shall be
made only upon receipt by the Trustee of a certification in the form provided on the reverse of the
Initial Notes from the transferor to the effect that such transfer is being made in accordance with
Regulation S or (if available) Rule 144 under the Securities Act and that, if such transfer is
being made prior to the expiration of the Distribution Compliance Period, the interest transferred
shall be held immediately thereafter through Euroclear or Clearstream. In the case of a transfer
of a beneficial interest in either the Regulation S Global Note or the Rule 144A Global Note for an
interest in the IAI Global Note, the transferee must furnish a signed letter substantially in the
form of Exhibit B to the Trustee.





     (ii) If the proposed transfer is a transfer of a beneficial interest in one Global Note
to a beneficial interest in another Global Note, the Registrar shall reflect on its books
and records the date and an increase in the principal amount of the Global Note to which
such interest is being transferred in an amount equal to the principal amount of the
interest to be so transferred, and the Registrar shall reflect on its books and records the
date and a corresponding decrease in the principal amount of Global Note from which such
interest is being transferred.




     (iii) Notwithstanding any other provisions of this Appendix A (other than the
provisions set forth in Section 2.4), a Global Note may not be transferred as a whole except
by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the
Depositary or another nominee of the Depositary or by the Depositary or any such nominee to
a successor Depositary or a nominee of such successor Depositary.



          (d) Restrictions on Transfer of Regulation S Global Note. (i) Prior to the expiration
of the Distribution Compliance Period, interests in the Regulation S Global Note may only be held
through Euroclear or Clearstream. During the Distribution Compliance Period, beneficial ownership
interests in the Regulation S Global Note may only be sold, pledged or transferred through
Euroclear or Clearstream in accordance with the Applicable Procedures and only (1) to the Issuer,
(2) so long as such security is eligible for resale pursuant to Rule 144A, to a person whom the
selling holder reasonably believes is a QIB that purchases for its own account or for the account
of a QIB to whom notice is given that the resale, pledge or transfer is being made in reliance on
Rule 144A, (3) in an offshore transaction in accordance with Regulation S, (4) pursuant to an
exemption from registration under the Securities Act provided by Rule 144 (if applicable) under the
Securities Act or another available exemption, (5) to an IAI purchasing for its own account, or for
the account of such an IAI, in a minimum principal amount of Notes of $250,000 or (6) pursuant to
an effective registration statement under the Securities Act, in each case in accordance with any
applicable securities laws of any state of the United States of America. Prior to the expiration
of the Distribution Compliance Period, transfers by an owner of a beneficial interest in the
Regulation S Global Note to a transferee who takes delivery of such interest through the Rule 144A
Global Note or the IAI Global Note shall be made only in accordance with Applicable Procedures and
upon receipt by the Trustee of a written certification from the transferor of the beneficial
interest in the form provided on the reverse of the Initial Note to the effect that such transfer
is being made to (1) a QIB




5









 







within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A or (2) an IAI purchasing for its own account, or for the account of such
an IAI, in a minimum principal amount of the Notes of $250,000. Such written certification shall
no longer be required after the expiration of the Distribution Compliance Period. In the case of a
transfer of a beneficial interest in the Regulation S Global Note for an interest in the IAI Global Note, the transferee must furnish a signed
letter substantially in the form of Exhibit B to the Trustee.





     (ii) Upon the expiration of the Distribution Compliance Period, beneficial
ownership interests in the Regulation S Global Note shall be transferable in accordance with
applicable law and the other terms of this Indenture.




     (e) Automatic Exchange of Beneficial Interests in a Global Note that is a Transfer
Restricted Note for Beneficial Interests in an Unrestricted Global Note. Upon the
Issuer’s satisfaction that the Restricted Notes Legend shall no longer be required in order
to maintain compliance with the Securities Act, beneficial interests in a Global Note that
is a Transfer Restricted Note may be automatically exchanged into beneficial interests in an
Unrestricted Global Note without any action required by or on behalf of the Holder (the
“Automatic Exchange”) at any time on or after the date that is the 366th calendar
day after (1) with respect to any Note issued on the Issue Date, the later of (x) the Issue
Date and (y) the last date on which the Issuer or any Affiliate of the Issuer was the owner
of such Note or (2) with respect to any Additional Note, if any, the later of (x) the issue
date of such Additional Note and (y) the last date on which the Issuer or any Affiliate of
the Issuer was the owner such Note, or, in each case, if such day is not a Business Day, on
the next succeeding Business Day (the “Automatic Exchange Date”). Upon the Issuer’s
satisfaction that the Restricted Notes Legend shall no longer be required in order to
maintain compliance with the Securities Act, the Issuer may (A) provide written notice to
the Trustee at least 10 calendar days prior to the Automatic Exchange, instructing the
Trustee to direct the Depositary to exchange all of the outstanding beneficial interests in
a particular Global Note that is a Transfer Restricted Note to the Unrestricted Global Note,
which the Issuer shall have previously otherwise made eligible for exchange with the DTC,
(B) provide prior written notice (the “Automatic Exchange Notice”) to each Holder at
such Holder’s address appearing in the register of Holders at least 10 calendar days prior
to the Automatic Exchange (the “Automatic Exchange Notice Date”), which notice must
include (I) the Automatic Exchange Date, (II) the section of the Indenture pursuant to which
the Automatic Exchange shall occur, (III) the “CUSIP” number of the Global Note that is a
Transfer Restricted Note from which such Holder’s beneficial interests will be transferred
and the (IV) “CUSIP” number of the Unrestricted Global Note into which such Holder’s
beneficial interests will be transferred, and (C) on or prior to the date of the Automatic
Exchange, deliver to the Trustee for authentication one or more Unrestricted Global Notes,
duly executed by the Issuer, in an aggregate principal amount equal to the aggregate
principal amount of Global Notes that are Transfer Restricted Notes to be exchanged. At the
Issuer’s request on no less than 5 calendar days’ notice, the Trustee shall deliver, in the
Issuer’s name and at its expense, the Automatic Exchange Notice to each Holder at such
Holder’s address appearing in the register of Holders. Notwithstanding anything to the
contrary in this Section 2.3, during the 10 day period between the Automatic Exchange Notice
Date and the Automatic Exchange Date, no transfers or exchanges other than pursuant to this
Section 2.3(e) shall be permitted without the prior written consent of the Issuer. As a
condition to any Automatic Exchange, the Issuer shall provide, and the Trustee shall be
entitled to rely upon, an Officers’ Certificate in form reasonably acceptable to the Trustee
to the effect that the Automatic Exchange shall be effected in compliance with the
Securities Act and that the restrictions on transfer contained herein and in the Restricted
Notes Legend shall no longer be required in order to maintain compliance with the Securities
Act and that the aggregate principal amount of the particular Global Note that is a Transfer
Restricted



6









 






Note is to be transferred to the particular Unrestricted Global Note by
adjustment made on the records of the Trustee, as custodian for the Depositary to reflect
the Automatic Exchange. Upon such exchange of beneficial interests pursuant to this Section
2.3(e), the aggregate principal amount of the Global Notes shall be increased or decreased
by adjustments made on the records of the Trustee, as custodian for the Depositary, to reflect the relevant increase or
decrease in the principal amount of such Global Note resulting from the applicable exchange.
The Global Note that is a Transfer Restricted Note from which beneficial interests are
transferred pursuant to an Automatic Exchange shall be canceled following the Automatic
Exchange.




     (f) Legends.




     (i) Except as permitted by the following paragraphs (ii), (iii) or (iv), each Note
certificate evidencing the Global Notes (other than an Unrestricted Global Note) and the
Definitive Notes (and all Notes issued in exchange therefor or in substitution thereof)
shall bear a legend in substantially the following form (each defined term in the legend
being defined as such for purposes of the legend only) (“Restricted Notes Legend”):




“THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH
REGISTRATION. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN
BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO
OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION
TERMINATION DATE”) THAT IS [IN THE CASE OF RULE 144A NOTES: ONE YEAR] [IN THE CASE OF
REGULATION S NOTES: 40 DAYS] AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST
DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS SECURITY (OR
ANY PREDECESSOR OF SUCH SECURITY), ONLY (A) TO THE ISSUER, (B) PURSUANT TO A REGISTRATION
STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE
SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A
PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED
STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL
“ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE SECURITY FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE
IN A MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND
NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF
THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE



7









 






ISSUER’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSES (C), (D), (E) OR (F) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/ OR OTHER INFORMATION SATISFACTORY TO
EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. [IN THE CASE OF REGULATION S NOTES:
BY ITS ACQUISITION HEREOF, THE HOLDER HEREOF REPRESENTS THAT IT IS NOT A U.S. PERSON NOR IS
IT PURCHASING FOR THE ACCOUNT OF A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN
OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT.]”


Each Definitive Note shall bear the following additional legend (“Definitive Notes
Legend”):





“IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER
AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE
TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.”


Each Note issued with original issue discount will also bear the following additional legend
(“OID Notes Legend”):





“THIS NOTE HAS BEEN ISSUED WITH “ORIGINAL ISSUE DISCOUNT” (WITHIN THE MEANING OF SECTION
1272 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED) FOR U.S. FEDERAL INCOME TAX PURPOSES.
UPON WRITTEN REQUEST, THE ISSUER WILL PROMPTLY MAKE AVAILABLE TO ANY HOLDER OF THIS NOTE
THE FOLLOWING INFORMATION: (1) THE ISSUE PRICE AND DATE OF THE NOTE, (2) THE AMOUNT OF
ORIGINAL ISSUE DISCOUNT ON THE NOTE AND (3) THE YIELD TO MATURITY OF THE NOTE. HOLDERS
SHOULD CONTACT THE TREASURER OF THE ISSUER AT 2700 COLORADO AVENUE, SUITE 200, SANTA MONICA,
CALIFORNIA 90404.”


Each Global Note shall bear the following additional legend (“Global Notes Legend”):





“UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.




TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART,
TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND
TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN




8









 






ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE
HEREOF.”




     (ii) Upon any sale or transfer of a Transfer Restricted Note that is a Definitive Note,
the Registrar shall permit the Holder thereof to exchange such Transfer Restricted Note for
a Definitive Note that does not bear the legends set forth above and rescind any
restriction on the transfer of such Transfer Restricted Note if the Holder certifies in
writing to the Registrar that its request for such exchange was made in reliance on Rule 144
(such certification to be in the form set forth on the reverse of the Initial Note).




     (iii) Upon a sale or transfer after the expiration of the Distribution Compliance
Period of any Initial Note or Additional Note acquired pursuant to Regulation S, all
requirements that such Initial Note or Additional Note bear the Restricted Notes Legend
shall cease to apply and the requirements requiring any such Initial Note or Additional Note
be issued in global form shall continue to apply.




     (iv) Any Additional Notes sold in a registered offering shall not be required to bear
the Restricted Notes Legend.



          (g) Cancellation or Adjustment of Global Note. At such time as all beneficial
interests in a Global Note have either been exchanged for Definitive Notes, transferred, redeemed,
repurchased or canceled, such Global Note shall be returned by the Depositary to the Trustee for
cancellation or retained and canceled by the Trustee. At any time prior to such cancellation, if
any beneficial interest in a Global Note is exchanged for Definitive Notes, transferred in exchange
for an interest in another Global Note, redeemed, repurchased or canceled, the principal amount of
Notes represented by such Global Note shall be reduced and an adjustment shall be made on the books
and records of the Trustee (if it is then the Custodian for such Global Note) with respect to such
Global Note, by the Trustee or the Custodian, to reflect such reduction.




          (h) No Obligation of the Trustee.





     (i) The Trustee shall have no responsibility or obligation to any beneficial owner
of a Global Note, a member of, or a participant in the Depositary or any other Person with
respect to the accuracy of the records of the Depositary or its nominee or of any
participant or member thereof, with respect to any ownership interest in the Notes or with
respect to the delivery to any participant, member, beneficial owner or other Person (other
than the Depositary) of any notice (including any notice of redemption or repurchase) or the
payment of any amount, under or with respect to such Notes. All notices and communications
to be given to the Holders and all payments to be made to Holders under the Notes shall be
given or made only to the registered Holders (which shall be the Depositary or its nominee
in the case of a Global Note). The rights of beneficial owners in any Global Note shall be
exercised only through the Depositary subject to the applicable rules and procedures of the
Depositary. The Trustee may rely and shall be fully protected in relying upon information
furnished by the Depositary with respect to its members, participants and any beneficial
owners.




     (ii) The Trustee shall have no obligation or duty to monitor, determine or inquire as
to compliance with any restrictions on transfer imposed under this Indenture or under
applicable law with respect to any transfer of any interest in any Note (including any
transfers between or among Depositary participants, members or beneficial owners in any
Global Note) other than to require delivery of such certificates and other documentation or
evidence as are expressly required by, and to do so if and when expressly required by, the
terms of this Indenture, and to



9









 






examine the same to determine substantial compliance as to form with the express requirements hereof.


Section 2.4 Definitive Notes.




          (a) A Global Note deposited with the Depositary or with the Trustee as Custodian pursuant to
Section 2.1 shall be transferred to the beneficial owners thereof in the form of Definitive Notes
in an aggregate principal amount equal to the principal amount of such Global Note, in exchange for
such Global Note, only if such transfer complies with Section 2.3 and (i) the Depositary notifies
the Issuer that it is unwilling or unable to continue as a Depositary for such Global Note or if at
any time the Depositary ceases to be a “clearing agency” registered under the Exchange Act and, in
each case, a successor depositary is not appointed by the Issuer within 90 days of such notice or
after the Issuer becomes aware of such cessation, or (ii) an Event of Default has occurred and is
continuing or (iii) the Issuer, in its sole discretion, notifies the Trustee in writing that it
elects to cause the issuance of certificated Notes under this Indenture. In addition, any Affiliate
of the Issuer or any Guarantor that is a beneficial owner of all or part of a Global Note may have
such Affiliate’s beneficial interest transferred to such Affiliate in the form of a Definitive
Note, by providing a written request to the Issuer and the Trustee and such Opinions of Counsel,
certificates or other information as may be required by the Indenture or the Issuer or Trustee.




          (b) Any Global Note that is transferable to the beneficial owners thereof pursuant to this
Section 2.4 shall be surrendered by the Depositary to the Trustee, to be so transferred, in whole
or from time to time in part, without charge, and the Trustee shall authenticate and deliver, upon
such transfer of each portion of such Global Note, an equal aggregate principal amount of
Definitive Notes of authorized denominations. Any portion of a Global Note transferred pursuant to
this Section shall be executed, authenticated and delivered only in denominations of $2,000 and
integral multiples of $1,000 in excess thereof and registered in such names as the Depositary shall
direct. Any certificated Initial Note or Additional Note in the form of a Definitive Note
delivered in exchange for an interest in the Global Note shall, except as otherwise provided by
Section 2.3(f), bear the Restricted Notes Legend.




          (c) Subject to the provisions of Section 2.4(b), the registered Holder of a Global Note may
grant proxies and otherwise authorize any Person, including Agent Members and Persons that may hold
interests through Agent Members, to take any action which a Holder is entitled to take under this
Indenture or the Notes.




          (d) In the event of the occurrence of any of the events specified in Section 2.4(a)(i), (ii)
or (iii), the Issuer shall promptly make available to the Trustee a reasonable supply of Definitive
Notes in fully registered form without interest coupons.





10









 








SCHEDULE 1




INTERCREDITOR AGREEMENTS





	1.	 	AMENDED AND RESTATED INTERCREDITOR AGREEMENT dated as of October 21, 2009, among (i) JPMorgan
Chase Bank, N.A. as Administrative Agent for the Lenders, (ii) U.S. Bank National Association,
as Collateral Agent for the Noteholders under the Indenture and the Collateral Agreement,
(iii) MQP, LLC, (iv) SGF Entertainment Inc., (v) Lions Gate Entertainment Inc., (vi) Lions
Gate Television Inc. and (vii) Lions Gate Films Inc.
	 
	2.	 	AMENDED AND RESTATED SUBORDINATION AGREEMENT entered into as of October 21, 2009, by and
among JPMorgan Chase Bank, N.A., as Administrative Agent for the Lenders under the Chase
Credit Agreement, U.S. Bank National Association, as Collateral Agent for the Noteholders
under the Indenture and the Collateral Agreement, Union Bank, N.A., as Administrative Agent
for itself and other Lenders, and SS3 Productions, Inc., a Pennsylvania corporation.
	 
	3.	 	AMENDED AND RESTATED SUBORDINATION AGREEMENT entered into as of October 21, 2009, by and
among JPMorgan Chase Bank, N.A., as Administrative Agent for the Lenders under the Chase
Credit Agreement, U.S. Bank National Association, as Collateral Agent for the Noteholders
under the Indenture and the Collateral Agreement, Union Bank, N.A., and Baster Productions,
LLC, a California limited liability company.
	 
	4.	 	AMENDED AND RESTATED INTERCREDITOR AGREEMENT entered into as of October 21, 2009 by and
between JPMorgan Chase Bank, N.A., as Administrative Agent for the Lenders
who are parties to the Chase Loan Agreement, U.S. Bank National Association, as Collateral
Agent for the Noteholders under the Indenture and the Collateral Agreement, on the one hand,
and First California Bank and Citibank, N.A., on the other hand, and Debmar/Mercury,
LLC.
	 
	5.	 	AMENDED AND RESTATED INTERCREDITOR AGREEMENT entered into as of October 21, 2009 by and
between JPMorgan Chase Bank, N.A., as Administrative Agent for the Lenders,
U.S. Bank National Association, as Collateral Agent for the Noteholders under the Indenture
and the Collateral Agreement, Bank Leumi USA, as successor in interest to ICB Entertainment
Finance, and Debmar/Mercury, LLC.
	 
	6.	 	AMENDED AND RESTATED INTERCREDITOR AGREEMENT entered into as of October 21, 2009 by and among
JPMorgan Chase Bank, National Association, as Agent for the Lenders who are parties to the
JPMC Credit Agreement, U.S. Bank National Association, as Collateral Agent for the Noteholders
under the Indenture and the Collateral Agreement, New Mexico State Investment Council, and
Wildfire 2 Productions, Inc.
	 
	7.	 	AMENDED AND RESTATED INTERCREDITOR AGREEMENT entered into as of October 21, 2009 by and among
JPMorgan Chase Bank, National Association, as Agent for the Lenders who are parties to the
JPMC Credit Agreement, U.S. Bank National Association, as Collateral Agent for the Noteholders
under the Indenture and the Collateral Agreement, New Mexico State Investment Council, and
Wildfire 3 Productions, Inc.
	 
	8.	 	AMENDED AND RESTATED INTERCREDITOR AGREEMENT entered into as of October 21, 2009 by and among
JPMorgan Chase Bank, National Association, as Agent for the Lenders who are parties to the
JPMC Credit Agreement, U.S. Bank National Association, as




1









 






	 	 	Collateral Agent for the Noteholders under the Indenture and the Collateral Agreement, New
Mexico State Investment Council, and Wildfire 4 Productions, Inc.






	9.	 	AMENDED AND RESTATED INTERCREDITOR AGREEMENT entered into as of October 21, 2009 by and among
JPMorgan Chase Bank, National Association, as Agent for the Lenders who are parties to the
JPMC Credit Agreement, U.S. Bank National Association, as Collateral Agent for the Noteholders
under the Indenture and the Collateral Agreement, New Mexico State Investment Council, and
Crash Television Productions, Inc.
	 
	10.	 	AMENDED AND RESTATED INTERCREDITOR AGREEMENT entered into as of October 21, 2009 by and among
JPMorgan Chase Bank, National Association, as Agent for the Lenders who are parties to the
JPMC Credit Agreement, U.S. Bank National Association, as Collateral Agent for the Noteholders
under the Indenture and the Collateral Agreement, New Mexico State Investment Council, and
Burrowers Productions, Inc.
	 
	11.	 	INTERCREDITOR AGREEMENT entered into as of October 21, 2009 by and among JPMorgan Chase Bank,
N.A., as Administrative Agent for the Lenders under the Chase Credit Agreement, U.S. Bank
National Association, as Collateral Agent for the Noteholders under the Indenture and the
Collateral Agreement, Union Bank, N.A., and Debmar/Mercury, LLC.
	 
	12.	 	AMENDED AND RESTATED INTERCREDITOR AGREEMENT entered into as of October 21, 2009 by and among
JPMorgan Chase Bank, National Association, as Administrative Agent for the Corporate Lenders,
JPMorgan Chase Bank, National Association, as Administrative Agent for the Production Lenders,
U.S. Bank National Association, as Collateral Agent for the Noteholders under the Indenture
and the Collateral Agreement, Lions Gate Entertainment Inc., and Lions Gate Mandate Financing
Vehicle, Inc.






2











 





EXHIBIT A




[FORM OF FACE OF NOTE]




[Insert the Restricted Notes Legend, if applicable, pursuant to the provisions of the Indenture]



[Insert the Global Notes Legend, if applicable, pursuant to the provisions of the Indenture]



[Insert the Definitive Notes Legend, if applicable, pursuant to the provisions of the Indenture]



[Insert the OID Notes Legend, if applicable, pursuant to the provisions of the Indenture]



A-1









 








CUSIP [   ]

ISIN [   ]1




[RULE 144A][REGULATION S][IAI][GLOBAL] NOTE




10.25% Senior Secured Second-Priority Notes due 2016



			
	No. ___
	 	Up to [$                    ]






LIONS GATE ENTERTAINMENT INC.




promises to pay to CEDE & CO. or registered assigns, the principal sum [set forth on the Schedule
of Exchanges of Interests in the Global Note attached hereto] [of                                          U.S.
Dollars] on November 1, 2016.




Interest Payment Dates: May 1 and November 1




Record Dates: April 15 and October 15






 




			
	1	 	Rule 144A Note CUSIP: 53626YAB4

Rule 144A Note ISIN: US53626YAB48

Regulation S Note CUSIP: U53648AA6

Regulation S Note ISIN: USU53648AA65

IAI Note CUSIP: 53626YAC2

IAI Note ISIN: US53626YAC21

Unrestricted Global Note CUSIP: 53626YAD0

Unrestricted Global Note ISIN: US53626YAD04




A-2









 










          IN WITNESS HEREOF, the Issuer has caused this instrument to be duly executed.
Dated: [                    ] [___], 20[___]



	 	 	 	 	 
	 	LIONS GATE ENTERTAINMENT INC.

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 



A-3









 






	 	 	 	 	 



This is one of the Notes referred to in the within-mentioned Indenture:




	 	 	 	 	 
	 	U.S. BANK NATIONAL ASSOCIATION, as Trustee

 	 
	 	By:  	 	 
	 	 	Authorized Signatory 	 
	 	 	 	 



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[Back of Note]




10.25% Senior Secured Second-Priority Notes due 2016




          Capitalized terms used herein shall have the meanings assigned to them in the Indenture
referred to below unless otherwise indicated.



          1. INTEREST. Lions Gate Entertainment Inc., a Delaware corporation, promises to pay interest
on the principal amount of this Note at 10.25% per annum from and including October 21, 2009 until
but excluding maturity. The Issuer shall pay interest semi-annually in arrears on May 1 and
November 1 of each year, or if any such day is not a Business Day, on the next succeeding Business
Day (each, an “Interest Payment Date”). Interest on the Notes shall accrue from and
including the most recent date to which interest has been paid or, if no interest has been paid,
from and including the date of issuance; provided that the first Interest Payment Date
shall be May 1, 2010. The Issuer shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on
demand at the interest rate on the Notes; it shall pay interest (including post-petition interest
in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to
any applicable grace periods) from time to time on demand at the interest rate on the Notes.
Interest shall be computed on the basis of a 360-day year comprised of twelve 30-day months.



          2. METHOD OF PAYMENT. The Issuer shall pay interest on the Notes to the Persons who are
registered holders of Notes at the close of business on April 15 or October 15 (whether or not a
Business Day), as the case may be, next preceding the Interest Payment Date, even if such Notes are
canceled after such record date and on or before such Interest Payment Date, except as provided in
Section 2.12 of the Indenture with respect to defaulted interest. Principal of and premium, if
any, and interest on the Notes shall be payable at the office or agency of the Issuer maintained
for such purpose or, at the option of the Issuer, payment of interest may be made by check mailed
to the Holders at their respective addresses set forth in the register of Holders; provided
that payment by wire transfer of immediately available funds shall be required with respect to
principal of and interest and premium on, all Global Notes and all other Notes the Holders of which
shall have provided wire transfer instructions to the Issuer or the Paying Agent. Such payment
shall be in such coin or currency of the United States of America as at the time of payment is
legal tender for payment of public and private debts.



          3. PAYING AGENT AND REGISTRAR. Initially, U.S. Bank National Association, the Trustee under
the Indenture, shall act as Paying Agent and Registrar. The Issuer may change any Paying Agent or
Registrar without notice to the Holders. The Issuer or any of its Subsidiaries may act in any such
capacity.



          4. INDENTURE. The Issuer issued the Notes under an Indenture, dated as of October 21, 2009
(the “Indenture”), among Lions Gate Entertainment Inc., Lions Gate Entertainment Corp., the
other Guarantors named therein and the Trustee. This Note is one of a duly authorized issue of
notes of the Issuer designated as its 10.25% Senior Secured Second-Priority Notes due 2016. The
Issuer shall be entitled to issue Additional Notes pursuant to Section 2.01 and 4.09 of the
Indenture. The terms of the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as amended (the “Trust Indenture
Act”). The Notes are subject to all such terms, and Holders are referred to the Indenture and
the Trust Indenture Act for a statement of such terms. To the extent any provision of this Note
conflicts with the express provisions of the Indenture, the provisions of the Indenture shall
govern and be controlling.



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          5. REDEMPTION AND REPURCHASE.



          The Notes are subject to optional redemption, and may be subject of an Offer to Purchase, as
further described in the Indenture. The Issuer shall not be required to make mandatory redemption
or sinking fund payments with respect to the Notes.



          6. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form without coupons in
denominations of $2,000 and integral multiples of $1,000 in excess thereof. The transfer of Notes
may be registered and Notes may be exchanged as provided in the Indenture. The Registrar and the
Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer
documents, and Holders shall be required to pay any taxes and fees required by law or permitted by
the Indenture. The Issuer need not
exchange or register the transfer of any Note or portion of a Note selected for redemption,
except for the unredeemed portion of any Note being redeemed in part. Also, the Issuer need not
exchange or register the transfer of any Notes for a period of 15 days before a selection of Notes
to be redeemed.



          7. PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as its owner for all
purposes.



          8. AMENDMENT, SUPPLEMENT AND WAIVER. The Indenture, the Notes Guarantees or the Notes may be
amended or supplemented as provided in the Indenture.



          9. DEFAULTS AND REMEDIES. The Events of Default relating to the Notes are defined in Section
6.01 of the Indenture. Upon the occurrence of an Event of Default, the rights and obligations of
the Issuer, the Guarantors, the Trustee and the Holders shall be as set forth in the Indenture.



          10. AUTHENTICATION. This Note shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose until authenticated by the manual signature of the Trustee.



          11. GOVERNING LAW. THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THE
INDENTURE, THE NOTES AND THE GUARANTEES.



          12. CUSIP AND ISIN NUMBERS. Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Issuer has caused CUSIP and ISIN numbers to be
printed on the Notes, and the Trustee may use CUSIP and ISIN numbers in notices of redemption as a
convenience to Holders. No representation is made as to the accuracy of such numbers either as
printed on the Notes or as contained in any notice of redemption and reliance may be placed only on
the other identification numbers placed thereon.



          The Issuer shall furnish to any Holder upon written request and without charge a copy of the
Indenture. Requests may be made to the Issuer at the following address:



c/o Lions Gate Entertainment Inc.

2700 Colorado Avenue, Suite 200

Santa Monica, California 90404

Fax No.: (310) 452-8934

Attention: Wayne Levin, EVP Corporate Operations & General Counsel




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ASSIGNMENT FORM




          To assign this Note, fill in the form below:



 




			
	(I) or (we) assign and transfer this Note to:
	 	 







(Insert assignee’s legal name)                
    




 





(Insert assignee’s soc. sec. or tax I.D. no.)




 

 

 

 





(Print or type assignee’s name, address and zip code)





			
	and irrevocably appoint
	 	 






to transfer this Note on the books of the Issuer. The agent may substitute another to act for him.




Date:                     





	 	 	 	 	 
	 	Your Signature:	 	 
	 	 	(Sign exactly as your name appears on the face of this Note) 	 
	 	 	 
	 	 	 
	 



Signature
Guarantee*:
                                                                                    






 




			
	*	 	Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor
acceptable to the Trustee).






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CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR

REGISTRATION OF TRANSFER RESTRICTED NOTES



This certificate relates to $                     principal amount of Notes held in (check applicable space)               book-entry or                
     definitive form by the undersigned.



The undersigned (check one box below):





	o	 	 has requested the Trustee by written order to deliver
in exchange for its beneficial interest in the Global
Note held by the Depositary a Note or Notes in
definitive, registered form of authorized
denominations and an aggregate principal amount equal
to its beneficial interest in such Global Note (or the
portion thereof indicated above) in accordance with
the Indenture; or
	 
	o	 	 has requested the Trustee by written order to exchange
or register the transfer of a Note or Notes.




In connection with any transfer of any of the Notes evidenced by this certificate occurring prior
to the expiration of the holding period referred to in Rule 144 under the Securities Act, the
undersigned confirms that such Notes are being transferred in accordance with its terms:



CHECK ONE BOX BELOW





	 	(1)     o	 	to the Issuer or subsidiary thereof; or
	 
	 	(2)     o	 	to the Registrar for registration in the name of the Holder, without transfer; or
	 
	 	(3)     o	 	pursuant to an effective registration statement under the Securities Act of 1933; or
	 
	 	(4)     o	 	inside the United States of America to a “qualified institutional buyer” (as
defined in Rule 144A under the Securities Act of 1933) that purchases for its own
account or for the account of a qualified institutional buyer to whom notice is given
that such transfer is being made in reliance on Rule 144A, in each case pursuant to and
in compliance with Rule 144A under the Securities Act of 1933; or
	 
	 	(5)     o	 	outside the United States of America in an offshore transaction within the
meaning of Regulation S under the Securities Act in compliance with Rule 904 under the
Securities Act of 1933; or
	 
	 	(6)     o	 	to an institutional “accredited investor” (as defined in Rule 501(a)(1), (2),
(3) or (7) under the Securities Act of 1933) that has furnished to the Trustee a signed
letter containing certain representations and agreements; or
	 
	 	(7)     o	 	pursuant to another available exemption from registration under the Securities Act of 1933.






	 	 	Unless one of the boxes is checked, the Trustee will refuse to register any of the Notes
evidenced by this certificate in the name of any Person other than the registered Holder
thereof; provided, however, that if box (5), (6) or (7) is checked, the
Trustee may require, prior to registering any such transfer of the Notes, such legal
opinions, certifications and other information as the Issuer has reasonably requested to
confirm that such transfer is being made pursuant to an exemption




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	 	 	from, or in a transaction not subject to, the registration requirements of the Securities
Act of 1933.





	 	 	 	 	 
	 	 	 
	 	 	 	 
	 	 	Your Signature 	 
	 	 	 	 
	 



	 	 	 	 	 	 	 	 	 
	Signature Guarantee:	 	 	 	 
	 
	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 
	 

	 	 
	 	 	 	 
	Signature must be guaranteed

by a participant in a

recognized signature guaranty

medallion program or other

signature guarantor acceptable

to the Trustee	 	 	 	Signature of Signature

Guarantor






TO BE COMPLETED BY PURCHASER IF (4) ABOVE IS CHECKED.




          The undersigned represents and warrants that it is purchasing this Note for its own account or
an account with respect to which it exercises sole investment discretion and that it and any such
account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities
Act of 1933, and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Issuer as the undersigned has
requested pursuant to Rule 144A or has determined not to request such information and that it is
aware that the transferor is relying upon the undersigned’s foregoing representations in order to
claim the exemption from registration provided by Rule 144A.



Dated:                                                    




	 	 	 	 	 
	 	 	 
	 	 	
 	 
	 	 	NOTICE:  To be executed by 	 
	 	 	an executive officer 	 



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OPTION OF HOLDER TO ELECT PURCHASE




          If you want to elect to have this Note purchased by the Issuer pursuant to Section 4.10 or
4.14 of the Indenture, check the appropriate box below:




o Section 4.10            o Section 4.14




          If you want to elect to have only part of this Note purchased by the Issuer pursuant to
Section 4.10 or Section 4.14 of the Indenture, state the amount you elect to have purchased:




$                                        




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Date:
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Your Signature:	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	(Sign exactly as your name appears on	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	the face of this Note)	 	 	 	 	 	 
	 	 	 	 	 	 	Tax Identification No.:                                                             





Signature Guarantee*:                                                             






 




			
	*	 	Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor
acceptable to the Trustee).




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SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE*




          The initial outstanding principal amount of this Global Note is $                    . The following
exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive
Note, or exchanges of a part of another Global or Definitive Note for an interest in this Global
Note, have been made:




	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	Principal Amount	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	of	 	 
	 	 	 	 	Amount of	 	Amount of increase	 	this Global Note	 	Signature of
	 	 	 	 	decrease	 	in Principal	 	following such	 	authorized officer
	Date of	 	in Principal	 	Amount of this	 	decrease or	 	of Trustee or
	Exchange	 	Amount	 	Global Note	 	increase	 	Custodian







 




			
	*	 	This schedule should be included only if the Note is issued in global form.




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EXHIBIT B




FORM OF

TRANSFEREE LETTER OF REPRESENTATION




Lions Gate Entertainment Inc.

2700 Colorado Avenue, Suite 200

Santa Monica, California 90404

Fax No.: (310) 452-8934

Attention: Wayne Levin, EVP Corporate Operations & General Counsel




In care of:

O’Melveny & Myers LLP

1999 Avenue of the Stars, 7th Floor

Los Angeles, CA 90067

Fax No: (310) 246-6779

Attention: David J. Johnson, Jr.



Ladies and Gentlemen:




     This certificate is delivered to request a transfer of $[  ] principal amount of the
10.25% Senior Secured Second-Priority Notes due 2016 (the “Notes”) of Lions Gate
Entertainment Inc. (the “Issuer”).



     Upon transfer, the Notes would be registered in the name of the new beneficial owner as
follows:


Name:                                                            



Address:                                                         



Taxpayer ID Number:                                    




     The undersigned represents and warrants to you that:



     1. We are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or
(7) under the Securities Act of 1933, as amended (the “Securities Act”)), purchasing for
our own account or for the account of such an institutional “accredited investor” at least $250,000
principal amount of the Securities, and we are acquiring the Securities not with a view to, or for
offer or sale in connection with, any distribution in violation of the Securities Act. We have
such knowledge and experience in financial and business matters as to be capable of evaluating the
merits and risks of our investment in the Notes, and we invest in or purchase securities similar to
the Notes in the normal course of our business. We, and any accounts for which we are acting, are
each able to bear the economic risk of our or its investment.



     2. We understand that the Notes have not been registered under the Securities Act and, unless
so registered, may not be sold except as permitted in the following sentence. We agree on our own
behalf and on behalf of any investor account for which we are purchasing Notes to offer, sell or
otherwise transfer such Notes prior to the date that is one year after the later of the date of
original issue and the last date on which the Issuer or any affiliate of the Issuer was the owner
of such Notes (or any predecessor thereto) (the “Resale Restriction Termination Date”) only
(a) to the Issuer, (b) pursuant to a registration statement that has been declared effective under
the Securities Act, (c) in a transaction complying with the requirements of Rule 144A under the
Securities Act (“Rule 144A”), to a person we reasonably believe is a qualified
institutional buyer under Rule 144A (a “QIB”) that is purchasing for its own account or for



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the account of a QIB and to whom notice is given that the transfer is being made in reliance
on Rule 144A, (d) pursuant to offers and sales that occur outside the United States of America
within the meaning of Regulation S under the Securities Act, (e) to an institutional “accredited
investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act that is
purchasing for its own account or for the account of such an institutional “accredited investor,”
in each case in a minimum principal amount of Notes of $250,000, or (f) pursuant to any other
available exemption from the registration requirements of the Securities Act, subject in each of
the foregoing cases to any requirement of law that the disposition of our property or the property
of such investor account or accounts be at all times within our or their control and in compliance
with any applicable state securities laws. The foregoing restrictions on resale will not apply
subsequent to the Resale Restriction Termination Date. If any resale or other transfer of the
Notes is proposed to be made pursuant to clause (e) above prior to the Resale Restriction
Termination Date, the transferor shall deliver a letter from the transferee substantially in the
form of this letter to the Issuer and the Trustee, which shall provide, among other things, that
the transferee is an institutional “accredited investor” within the meaning of Rule 501(a)(1), (2),
(3) or (7) under the Securities Act and that it is acquiring such Notes for investment purposes and
not for distribution in violation of the Securities Act. Each purchaser acknowledges that the
Issuer and the Trustee reserve the right prior to the offer, sale or other transfer prior to the
Resale Restriction Termination Date of the Notes pursuant to clause (c), (d), (e) or (f) above to
require the delivery of an opinion of counsel, certifications or other information satisfactory to
the Issuer and the Trustee.




	 	 	 	 	 
	 	TRANSFEREE:                                          , 

 	 
	 	by:  	 	 
	 	 	        	 
	 	 	 	 
	 








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EXHIBIT C




FORM OF SUPPLEMENTAL INDENTURE

TO BE DELIVERED BY SUBSEQUENT GUARANTORS





     Supplemental Indenture (this “Supplemental Indenture”), dated as of [                    ] [___],
20[___], among                                          (the “Guaranteeing Subsidiary”), a subsidiary of [Name of
Issuer], a [insert jurisdiction] corporation (the “Issuer”), and U.S. Bank National
Association, as trustee (the “Trustee”).



W I T N E S S E T H




          WHEREAS, each of the Issuer and the Guarantors (as defined in the Indenture referred to below)
has heretofore executed and delivered to the Trustee an indenture (the “Indenture”), dated
as of October 21, 2009, providing for the issuance of an unlimited aggregate principal amount of
10.25% Senior Secured Second-Priority Notes due 2016 (the “Notes”);




          WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiary
shall execute and deliver to the Trustee a supplemental indenture pursuant to which the
Guaranteeing Subsidiary shall unconditionally guarantee all of the Issuer’s Obligations under the
Notes and the Indenture on the terms and conditions set forth herein and under the Indenture; and




          WHEREAS, pursuant to Section 9.01 of the Indenture, the Trustee is authorized to execute and
deliver this Supplemental Indenture.




          NOW THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties mutually covenant and agree
for the equal and ratable benefit of the Holders as follows:




          1. Capitalized Terms. Capitalized terms used herein without definition shall have the
meanings assigned to them in the Indenture.




          2. Guarantor. The Guaranteeing Subsidiary hereby agrees to be a Guarantor under the
Indenture and to be bound by the terms of the Indenture applicable to Guarantors, including, but
not limited to, Article 11 thereof.




          3. Governing Law. THIS SUPPLEMENTAL INDENTURE WILL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.




          4. Counterparts. The parties may sign any number of copies of this Supplemental
Indenture. Each signed copy shall be an original, but all of them together represent the same
agreement.




          5. Headings. The headings of the Sections of this Supplemental Indenture have been
inserted for convenience of reference only, are not to be considered a part of this Supplemental
Indenture and shall in no way modify or restrict any of the terms or provisions hereof.




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          IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly
executed, all as of the date first above written.




	 	 	 	 	 
	 	[NAME OF GUARANTEEING SUBSIDIARY]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	U.S. BANK NATIONAL ASSOCIATION, as Trustee

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title: