EXHIBIT 4.27


 


OWENS-BROCKWAY
GLASS CONTAINER INC.


 


€225,000,000 6
3⁄4 % Senior Notes due 2014

$400,000,000 6 3⁄4 % Senior Notes due 2014


 


REGISTRATION
RIGHTS AGREEMENT


 


	
   

  	
  New York, New York

  
	
   

  	
  December 1, 2004

  



 


Goldman, Sachs
& Co.

Citigroup Global Markets Inc. 

c/o Goldman, Sachs & Co.

85 Broad Street 

New York, New York 10004


 


Dear Sirs:


 


Owens-Brockway
Glass Container Inc., a corporation organized under the laws of Delaware (the “Company”),
proposes to issue and sell to (i) the several parties named in Schedule I-A
hereto (collectively, the “Euro Initial Purchasers”), upon the terms set
forth in a purchase agreement, dated November 23, 2004 (the “Purchase
Agreement”), €225,000,000 aggregate principal amount of its 6 3⁄4 % Senior Notes due 2014 (the “Euro
Notes”) and (ii) the several parties named in Schedule I-B hereto
(collectively, the “Dollar Initial Purchasers” and, together with the
Euro Initial Purchasers, the “Initial Purchasers”), upon the terms set
forth in the Purchase Agreement, $400,000,000 aggregate principal amount of its
6 3⁄4 % Senior Notes due 2014 (the
“Dollar Notes”) and together with the Euro Notes, the “Notes”),
in each case, to be guaranteed by the Guarantors (the “Guarantees” and,
together with the Notes, the “Securities”) relating to the initial
placement of the Securities (the “Initial Placement”).  To induce the Initial Purchasers to enter
into the Purchase Agreement and to satisfy a condition of your obligations
thereunder, each of the Company and the Guarantors agree, as follows:


 


1.             Definitions. 
Capitalized terms used herein without definition shall have their
respective meanings set forth in the Purchase Agreement.  As used in this Agreement, the following
capitalized defined terms shall have the following meanings:


 


“Act” shall mean the Securities Act of
1933, as amended, and the rules and regulations of the Commission promulgated
thereunder.


 


“Additional Interest” shall have the
meaning set forth in Section 5 hereof.


 


“Additional Securities” shall have the
meaning set forth in the Indenture.


 


“Advice” shall have the meaning set
forth in Section 6 hereof.


 





















 


“Affiliate” of any specified Person
shall mean any other Person that, directly or indirectly, is in control of, is
controlled by, or is under common control with, such specified Person.  For purposes of this definition, “control” of
a Person shall mean the power, direct or indirect, to direct or cause the
direction of the management and policies of such Person whether by contract or
otherwise, and the terms “controlling” and “controlled” shall have meanings
correlative to the foregoing.


 


“Broker-Dealer” shall mean any broker
or dealer registered as such under the Exchange Act.


 


“Broker-Dealer Transfer Restricted
Securities” shall mean New Securities that are acquired by a Broker-Dealer
in the Exchange Offer in exchange for Securities that such Broker-Dealer
acquired for its own account as a result of market-making activities or other
trading activities (other than Securities acquired directly from the Company or
any of its Affiliates).


 


“Business Day” shall mean any day
other than a Saturday, a Sunday or a legal holiday or a day on which banking
institutions or trust companies are authorized or obligated by law to close in
New York City or in the city of the corporate trust office of the Trustee.


 


“Closing Date” shall mean the date of
this Agreement.


 


“Commission” shall mean the Securities
and Exchange Commission.


 


“Consummate” an Exchange Offer shall
be deemed “Consummated” for purposes of this Agreement upon the occurrence of
(i) the filing and effectiveness under the Act of the Exchange Offer
Registration Statement relating to the New Securities to be issued in the
Exchange Offer, (ii) the maintenance of such Exchange Offer Registration
Statement continuously effective and the keeping of the Exchange Offer open for
a period not less than the minimum period required pursuant to Section 3(b)
hereof, and (iii) the delivery by the Company to the Registrar under the
Indenture of New Securities in the same aggregate principal amount as the
aggregate principal amount of Securities that were tendered by Holders thereof
pursuant to the Exchange Offer.


 


“Exchange Act” shall mean the
Securities Exchange Act of 1934, as amended, and the rules and regulations of
the Commission promulgated thereunder.


 


“Exchange Offer” shall mean the registration by the Company and the
Guarantors under the Act of the New Securities pursuant to a Registration Statement pursuant
to which the Company offers the Holders of all outstanding Transfer Restricted
Securities the opportunity to exchange all such outstanding Transfer Restricted
Securities held by such Holders for New Securities in an aggregate principal amount equal to the
aggregate principal amount of the Transfer Restricted Securities tendered in
such exchange offer by such Holders.


 


“Exchange Offer Registration Statement”
shall mean a registration statement of the Company and
the Guarantors on an appropriate
form under the Act with respect to the Exchange Offer, all amendments and
supplements to such registration statement, including post-effective amendments
thereto, in each case
including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.


 


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“Final Memorandum” shall
have the meaning set forth in the Purchase
Agreement.


 


“Guarantors” shall mean the guarantors
listed on the signature pages hereof (each individually, a “Guarantor”
and collectively, the “Guarantors”).


 


“Holder” shall
have the meaning set
forth in Section 2(b) hereof.


 


“indemnified party” shall have the meaning
set forth in Section 8(c)
hereof.


 


“indemnifying party” shall have the meaning
set forth in Section 8(c)
hereof.


 


“Indenture” shall
mean the Indenture, dated as of
December 1, 2004, among the Company, the Guarantors and Law
Debenture Trust Company of New York, as trustee (the “Trustee”), pursuant to which the
Securities and the New Securities are to be issued as such Indenture may be amended or
supplemented from time to time in
accordance with the terms thereof.


 


“Initial Placement” shall
have the meaning set forth in the preamble hereto.


 


“Initial Purchaser” shall have the
meaning set forth in the preamble hereto.


 


“Interest Payment Date” shall have the
meaning set forth in the Indenture and the Notes.


 


“NASD” shall mean the National
Association of Securities Dealers, Inc.


 


“New Securities” shall
mean debt securities
of the Company, including guarantees thereon, identical in all material respects to the
Securities and any Additional Securities (except that the cash interest, interest rate
step-up provisions and transfer restrictions shall be modified or eliminated, as appropriate) to
be issued under the Indenture in exchange for Transfer Restricted Securities.


 


“Notes” shall have the meaning set
forth in the preamble hereto.


 


“Person” shall mean an individual, partnership, corporation, trust
or unincorporated organization, or a government or agency or political
subdivision thereof.


 


“Prospectus” shall
mean the prospectus
included in any Registration Statement (including, without limitation, a
prospectus that discloses information previously omitted from a prospectus
filed as part of an effective Registration Statement in reliance upon Rule 430A
under the Act), as amended or supplemented by any prospectus supplement, with
respect to an Exchange Offer or a Shelf Registration, and all amendments and supplements thereto
and all material incorporated by reference therein.


 


“Purchase Agreement” shall have the
meaning set forth in the preamble hereto.


 


“Registration Default” shall have the
meaning set forth in Section 5 hereof.


 


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“Registration Statement” shall
mean any Exchange
Offer Registration Statement or Shelf Registration Statement that covers any of
the Securities or the New Securities pursuant to the provisions of this
Agreement, any amendments and supplements to such registration statement, including
post-effective amendments (in each case including the Prospectus contained
therein), all exhibits thereto and all material incorporated by reference
therein.


 


“Securities” shall
have the meaning set forth in the preamble hereto.


 


“Shelf Filing Deadline” shall have the
meaning set forth in Section 4(a) hereof.


 


“Shelf Registration” shall
mean a registration
effected pursuant to Section 4 hereof.


 


“Shelf Registration Statement” shall
have the meaning set forth in Section 4(a) hereof.


 


“Transfer Restricted Securities” shall mean each Security, until the earliest to occur of
(a) the date on which such Security has been exchanged by a Person other than a
broker-dealer for a New Security in the Exchange Offer, (b) following the
exchange by a broker-dealer in the Exchange Offer of a Security for a New
Security, the date on
which such New Security is sold to a purchaser who receives from such
broker-dealer on or prior to the date of such sale a copy of the Prospectus
contained in the Exchange Offer Registration Statement, (c) the date on which
such Security has been effectively registered under the Act and disposed of in
accordance with the Shelf Registration Statement, or (d) the date on which such
Security is distributed to the public pursuant to Rule 144 under the Act.


 


“Trust Indenture Act” shall mean the
Trust Indenture Act of 1939, as amended.


 


“Trustee” shall
mean the trustee with
respect to the Securities under the Indenture.


 


“underwriter” shall
mean any underwriter
of Securities in connection with an offering thereof under a Shelf Registration
Statement.


 


“Underwritten Registration” or “Underwritten
Offering” shall mean a registration in which securities of the Company are
sold to an underwriter for reoffering to the public.


 


2.             Securities Subject to this Agreement.


 


(a)           Transfer
Restricted Securities.  The
securities entitled to the benefits of this Agreement are the Transfer
Restricted Securities.


 


(b)           Holders
of Transfer Restricted Securities.  A
Person is deemed to be a holder of Transfer Restricted Securities (each, a “Holder”)
whenever such Person owns Transfer Restricted Securities.


 


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3.             Registered Exchange Offer.


 


(a)           Unless
the Exchange Offer shall not be permissible under applicable law or Commission
policy (after the procedures set forth in Section 6(a) below have been complied
with), the Company and the Guarantors shall (i) use their best efforts to cause
to be filed with the Commission on or prior to May 30, 2005, the Exchange Offer
Registration Statement under the Act relating to the New Securities and the
Exchange Offer, (ii) use their commercially reasonable efforts to cause such
Exchange Offer Registration Statement to become effective within July 29, 2005
of such filing, (iii) in connection with the foregoing, file (A) all
pre-effective amendments to such Exchange Offer Registration Statement as may
be necessary in order to cause such Exchange Offer Registration Statement to
become effective, (B) if applicable, a post-effective amendment to such Exchange
Offer Registration Statement pursuant to Rule 430A under the Act and (C) cause
all necessary filings in connection with the registration and qualification of
the New Securities to be made under the Blue Sky laws of such jurisdictions as
are necessary to permit Consummation of the Exchange Offer, and (iv) upon the
effectiveness of such Exchange Offer Registration Statement, commence the
Exchange Offer.  The Exchange Offer shall
be on the appropriate form permitting registration of the New Securities to be
offered in exchange for the Transfer Restricted Securities and to permit
resales of Broker-Dealer Transfer Restricted Securities by Broker-Dealers as
contemplated by Section 3(c) below.


 


(b)           The
Company and the Guarantors shall cause the Exchange Offer Registration
Statement to be effective continuously and shall keep the Exchange Offer open
for a period of not less than the minimum period required under applicable
federal and state securities laws to Consummate the Exchange Offer; provided,
however, that in no event shall such period be less than 20 Business
Days.  The Company and the Guarantors
shall cause the Exchange Offer to comply with all applicable federal and state
securities laws.  No securities other
than the New Securities and the related guarantees thereto shall be included in
the Exchange Offer Registration Statement. 
The Company and the Guarantors shall use their commercially reasonable
efforts to cause the Exchange Offer to be Consummated within 40 days after the
Exchange Offer Registration Statement has become effective.


 


(c)           The
Company shall indicate in a “Plan of Distribution” section contained in the
Prospectus forming a part of the Exchange Offer Registration Statement that any
Broker-Dealer who holds Securities that are Transfer Restricted Securities and
that were acquired for its own account as a result of market-making activities
or other trading activities (other than Transfer Restricted Securities acquired
directly from the Company or one of its Affiliates), may exchange such Securities
pursuant to the Exchange Offer; however, such Broker-Dealer may be deemed to be
an “underwriter” within the meaning of the Act and must, therefore, deliver a
prospectus meeting the requirements of the Act in connection with any resales
of the New Securities received by such Broker-Dealer in the Exchange Offer,
which prospectus delivery requirement may be satisfied by the delivery by such
Broker-Dealer of the Prospectus contained in the Exchange Offer Registration
Statement.  Such “Plan of Distribution”
section shall also contain all other information with respect to such resales
by Broker-Dealers that the Commission may require in order to permit such
resales pursuant thereto, but such “Plan of Distribution” shall not name any
such Broker-Dealer or disclose the amount of Securities held by any such
Broker-Dealer except to the extent required by the Commission as a result of a
change in policy after the date of this Agreement.


 


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The Company and the Guarantors shall use
their commercially reasonable efforts to keep the Exchange Offer Registration
Statement continuously effective, supplemented and amended as required by the
provisions of Section 6(c) below to the extent necessary to ensure that it is
available for resales of Broker-Dealer Transfer Restricted Securities acquired
by Broker-Dealers, and to ensure that it conforms with the requirements of this
Agreement, the Act and the policies, rules and regulations of the Commission as
announced from time to time, for a period ending on the earlier of (i) 90 days
from the date on which the Exchange Offer Registration Statement is declared
effective and (ii) the date on which a Broker-Dealer is no longer required to
deliver a prospectus in connection with market-making or other trading
activities.


 


The Company shall provide sufficient copies
of the latest version of such Prospectus to such Broker-Dealers promptly upon
request at any time during such 90-day (or shorter as provided in the foregoing
sentence) period in order to facilitate such resales.


 


4.             Shelf Registration.


 


(a)           Shelf
Registration.  If (i) the Company and
the Guarantors are not permitted to Consummate the Exchange Offer because the
Exchange Offer is not permitted by applicable law or Commission policy (after
the procedures set forth in Section 6(a) below have been complied with), or
(ii) any Holder of Transfer Restricted Securities shall notify the Company on
or prior to the 20th day following the Consummation of the Exchange Offer that
(A) such Holder is prohibited by applicable law or Commission policy from
participating in the Exchange Offer, (B) such Holder may not resell the New
Securities acquired by it in the Exchange Offer to the public without
delivering a prospectus and that the Prospectus contained in the Exchange Offer
Registration Statement is not appropriate or available for such resales by such
Holder, or (C) such Holder is a Broker-Dealer and owns Securities acquired
directly from the Company or an Affiliate of the Company, then, the Company and
the Guarantors shall:


 


(x) 
use their best efforts to cause to be filed a shelf registration
statement pursuant to Rule 415 under the Act, which may be an amendment to the
Exchange Offer Registration Statement (in either event, the “Shelf Registration
Statement”) on or prior to 60 days after such filing obligation arises
pursuant to this paragraph 4(a), (such date being the “Shelf Filing Deadline”),
which Shelf Registration Statement shall provide for resales of all Transfer
Restricted Securities the Holders of which shall have provided the information
required pursuant to Section 4(b) hereof; and


 


(y) 
use their commercially reasonable efforts to cause such Shelf
Registration Statement to be declared effective by the Commission on or prior
to 120 days after such filing obligation arises pursuant to paragraph 4(a)
above.


 


The Company
and the Guarantors shall use their commercially reasonable efforts to keep such
Shelf Registration Statement continuously effective, supplemented and amended
as required by the provisions of Sections 6(b) and (c) hereof to the extent
necessary to ensure that it is available for resales of Notes by the Holders of
Transfer Restricted Securities entitled to the benefit of this Section 4(a),
and to ensure that it conforms with the requirements of this Agreement, the Act
and 


 


6





















 


the policies,
rules and regulations of the Commission as announced from time to time, for a
period of at least two years following the effective date of such Shelf
Registration Statement (or shorter period that will terminate when all the
Securities covered by such Shelf Registration Statement have been sold pursuant
to such Shelf Registration Statement).


 


(b)           Provision
by Holders of Certain Information in Connection with the Shelf Registration
Statement.  No Holder of Transfer
Restricted Securities may include any of its Transfer Restricted Securities in
any Shelf Registration Statement pursuant to this Agreement unless and until
such Holder furnishes to the Company in writing, within 20 days after receipt
of a request therefor, such information as the Company may reasonably request
for use in connection with any Shelf Registration Statement or Prospectus or
preliminary Prospectus included therein. 
Each Holder as to which any Shelf Registration Statement is being
effected agrees to furnish promptly to the Company all information required to
be disclosed in order to make the information previously furnished to the
Company by such Holder not materially misleading.


 


5.             Additional Interest.


 


If (i) any Registration Statement required by
this Agreement is not filed with the Commission on or prior to the date
specified for such filing in this Agreement, (ii) any such Registration
Statement has not been declared effective by the Commission on or prior to the
date specified for such effectiveness in this Agreement, (iii) the Exchange
Offer has not been Consummated within 40 days after the Exchange Offer
Registration Statement is declared effective or (iv) any Registration Statement
required by this Agreement is filed and declared effective but shall thereafter
cease to be effective or fail to be usable for its intended purpose without
being succeeded immediately by a post-effective amendment to such Registration Statement
that cures such failure and that is itself immediately declared effective (each
such event referred to in clauses (i) through (iv), a “Registration Default”),
the Company and the Guarantors hereby agree to pay additional interest to each
Holder of outstanding Securities (“Additional Interest”) during the
period of one or more Registration Defaults, with respect to the first 90-day
period immediately following the occurrence of the first Registration Default
in an amount equal to 0.25% per annum (which amount will be increased by an
additional 0.25% per annum for each subsequent 90-day period that any
Additional Interest continue to accrue; provided that the amounts at which
Additional Interest accrue may in no event exceed 1.0% per annum) in respect of
the Transfer Restricted Securities held by such Holder until the applicable
Registration Statement is filed, the Exchange Offer Registration Statement is
declared effective and the Exchange Offer is Consummated or the Shelf
Registration Statement is declared effective or again becomes effective, as the
case may be.  All accrued Additional
Interest will be paid by the Company and the Guarantors on each Interest
Payment Date to Holders of global Securities by wire transfer of immediately
available funds or by federal funds check and to holders of certificated
Securities by wire transfer to the accounts specified by them or by mailing
checks to their registered addresses if no such accounts have been
specified.  Following the cure of all
Registration Defaults, the accrual of Additional Interest will cease; provided,
however, that, if after the cessation of the accrual of Additional
Interest, a different Registration Default occurs, Additional Interest shall
again accrue pursuant to the foregoing provisions.


 


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All obligations of the Company and the
Guarantors set forth in the preceding paragraph that are outstanding with
respect to any Transfer Restricted Security at the time such security ceases to
be a Transfer Restricted Security shall survive until such time as all such
obligations with respect to such Security shall have been satisfied in full.


 


6.             Registration Procedures.


 


(a)           Exchange
Offer Registration Statement.  In
connection with the Exchange Offer, the Company and the Guarantors shall comply
with the applicable provisions of Section 6(c) below, shall use their
commercially reasonable efforts to effect such exchange to permit the sale of
Broker-Dealer Transfer Restricted Securities being sold in accordance with the
intended method or methods of distribution thereof (which shall be in a manner
consistent with the terms of this Agreement), and shall comply with all of the
following provisions:


 


(i)            If in the reasonable opinion of
counsel to the Company there is a question as to whether the Exchange Offer is
permitted by applicable law, the Company and the Guarantors hereby agree to
seek a no-action letter or other favorable decision from the Commission
allowing the Company and the Guarantors to Consummate an Exchange Offer for
such Securities.  The Company and the
Guarantors each hereby agree to pursue the issuance of such a decision to the
Commission staff level but shall not be required to take commercially unreasonable
action to effect a change of Commission policy. 
The Company and the Guarantors each hereby agree, however, to (A)
participate in telephonic conferences with the staff of Commission, (B) deliver
to the Commission staff an analysis prepared by counsel to the Company setting
forth the legal bases, if any, upon which such counsel has concluded that such
an Exchange Offer should be permitted and (C) use commercially reasonable
efforts to diligently pursue a favorable resolution by the Commission staff of
such submission.


 


(ii)           As a condition to its participation
in the Exchange Offer pursuant to the terms of this Agreement, each Holder of
Transfer Restricted Securities shall furnish, upon the request of the Company,
prior to the Consummation thereof, a written representation to the Company
(which may be contained in the letter of transmittal contemplated by the
Exchange Offer Registration Statement) to the effect that (A) it is not an
Affiliate of the Company, (B) it is not engaged in, and does not intend to
engage in, and has no arrangement or understanding with any person to
participate in, a distribution of the New Securities to be issued in the
Exchange Offer and (C) it is acquiring the New Securities in its ordinary
course of business.  In addition, all such
Holders of Transfer Restricted Securities shall otherwise cooperate in the
Company’s and the Guarantor’s preparations for the Exchange Offer.  Each Holder hereby acknowledges and agrees
that any Broker-Dealer and any such Holder using the Exchange Offer to
participate in a distribution of the securities to be acquired in the Exchange
Offer (1) could not under Commission policy as in effect on the date of this
Agreement rely on the position of the Commission enunciated in Morgan
Stanley and Co., Inc. (available June 5, 1991) and Exxon Capital Holdings
Corporation (available May 13, 1988), as interpreted in the Commission’s
letter to Shearman & Sterling dated July 2, 1993, and similar no-action
letters (which may include any no-action letter obtained pursuant to clause (i)
above), and (2) must comply with the registration and prospectus delivery 


 


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requirements of the Act in connection with a secondary
resale transaction and that such a secondary resale transaction should be
covered by an effective registration statement containing the selling security
holder information required by Item 507 or 508, as applicable, of Regulation
S-K under the Act if the resales are of New Securities obtained by such Holder
in exchange for Securities acquired by such Holder directly from the Company or
one of its Affiliates.


 


(iii)          Prior to effectiveness of the Exchange
Offer Registration Statement, the Company and the Guarantors shall provide a
supplemental letter to the Commission (A) stating that the Company and the
Guarantors are registering the Exchange Offer in reliance on the position of
the Commission enunciated in Exxon Capital Holdings Corporation
(available May 13, 1988), Morgan Stanley and Co., Inc. (available June
5, 1991) and, if applicable, any no-action letter obtained pursuant to clause
(i) above, (B) including a representation that neither the Company nor any
Guarantor has entered into any arrangement or understanding with any Person to
distribute the New Securities to be received in the Exchange Offer and that, to
the best of the Company’s information and belief, each Holder participating in
the Exchange Offer is acquiring the New Securities in its ordinary course of
business and has no arrangement or understanding with any Person to participate
in the distribution of the New Securities received in the Exchange Offer and
(C) any other undertaking or representation required by the Commission as set
forth in any no-action letter obtained pursuant to clause (i) above.


 


(b)           Shelf
Registration Statement.  In
connection with the Shelf Registration Statement, the Company and the
Guarantors shall comply with all the provisions of Section 6(c) below and shall
use their commercially reasonable efforts to effect such registration to permit
the sale of the Transfer Restricted Securities being sold in accordance with
the intended method or methods of distribution thereof, and pursuant thereto
the Company and the Guarantors will as expeditiously as possible prepare and
file with the Commission a Registration Statement relating to the registration
on any appropriate form under the Act, which form shall be available for the
sale of the Transfer Restricted Securities in accordance with the intended
method or methods of distribution thereof.


 


(c)           General
Provisions.  In connection with any
Registration Statement and any Prospectus required by this Agreement to permit
the sale or resale of Transfer Restricted Securities (including, without
limitation, any Registration Statement and the related Prospectus required to
permit resales of Broker-Dealer Transfer Restricted Securities by
Broker-Dealers), the Company and the Guarantors shall:


 


(i)            use their commercially reasonable
efforts to keep such Registration Statement continuously effective and provide
all requisite financial statements (including, if required by the Act or any
regulation thereunder, financial statements of the Guarantors) for the period
specified in Section 3 or 4 of this Agreement, as applicable; upon the
occurrence of any event that would cause any such Registration Statement or the
Prospectus contained therein (A) to contain a material misstatement or omission
or (B) not to be effective and usable for resale of Transfer Restricted
Securities during the period required by this Agreement, the Company and the Guarantors
shall file promptly 


 


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an appropriate amendment to such Registration
Statement, in the case of clause (A), correcting any such misstatement or
omission, and, in the case of either clause (A) or (B), use their commercially
reasonable efforts to cause such amendment to be declared effective and such
Registration Statement and the related Prospectus to become usable for their
intended purpose(s) as soon as practicable thereafter;


 


(ii)           use commercially reasonable efforts
to prepare and file with the Commission such amendments and post-effective
amendments to the Registration Statement as may be necessary to keep the
Registration Statement effective for the applicable period set forth in Section
3 or 4 hereof, as applicable, or such shorter period as will terminate when all
Transfer Restricted Securities covered by such Registration Statement have been
sold; cause the Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424 under the
Act, and to comply fully with the applicable provisions of Rules 424 and 430A
under the Act in a timely manner; and comply with the provisions of the Act
with respect to the disposition of all securities covered by such Registration
Statement during the applicable period in accordance with the intended method
or methods of distribution by the sellers thereof set forth in such
Registration Statement or supplement to the Prospectus;


 


(iii)          advise the underwriter(s), if any, and
selling Holders promptly and, if requested by such Persons, to confirm such
advice in writing, (A) when the Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to any Registration
Statement or any post-effective amendment thereto, when the same has become
effective, (B) of any request by the Commission for amendments to the
Registration Statement or amendments or supplements to the Prospectus or for
additional information relating thereto, (C) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration Statement
under the Act or of the suspension by any state securities commission of the
qualification of the Transfer Restricted Securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for any of the preceding
purposes, (D) of the existence of any fact or the happening of any event that
makes any statement of a material fact made in the Registration Statement, the
Prospectus, any amendment or supplement thereto, or any document incorporated
by reference therein untrue, or that requires the making of any additions to or
changes in the Registration Statement or the Prospectus in order to make the
statements therein not misleading.  If at
any time the Commission shall issue any stop order suspending the effectiveness
of the Registration Statement, or any state securities commission or other
regulatory authority shall issue an order suspending the qualification or
exemption from qualification of the Transfer Restricted Securities under state
securities or Blue Sky laws, the Company and the Guarantors shall use their
commercially reasonable efforts to obtain the withdrawal or lifting of such
order at the earliest possible time;


 


(iv)          in the case of a Shelf Registration
Statement, furnish without charge to each of the Initial Purchasers, each
selling Holder named in any Registration Statement, and each of the
underwriter(s), if any, before filing with the Commission, copies of any Registration
Statement or any Prospectus included therein or any amendments or supplements
to any such Registration Statement or Prospectus (including


 


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all documents incorporated by reference after the
initial filing of such Registration Statement), which documents will be subject
to the review of such Holders and underwriter(s) in connection with such sale,
if any, for a period of at least three Business Days, and neither the Company
nor the Guarantors will file any such Registration Statement or Prospectus or
any amendment or supplement to any such Registration Statement or Prospectus
(including all such documents incorporated by reference) to which an Initial
Purchaser or the underwriter(s), if any, shall reasonably object in writing
within five Business Days after the receipt thereof (such objection to be
deemed timely made upon confirmation of telecopy transmission within such
period).  The objection of an Initial Purchaser
or underwriter, if any, shall be deemed to be reasonable if such Registration
Statement, amendment, Prospectus or supplement, as applicable, as proposed to
be filed, contains a material misstatement or omission;


 


(v)           in connection with any underwritten
offering pursuant to a Shelf Registration Statement, promptly prior to the
filing of any document that is to be incorporated by reference into a Shelf
Registration Statement or Prospectus, provide copies of such document to the
Initial Purchasers, each selling Holder named in any Shelf Registration
Statement, and to the underwriter(s), if any, make the Company’s
representatives and representatives of the Guarantors available for discussion
of such document and other customary due diligence matters, and include such
information in such document prior to the filing thereof as such selling
Holders or underwriter(s), if any, reasonably may request;


 


(vi)          in connection with any underwritten
offering pursuant to a Shelf Registration Statement, make available at
reasonable times during normal business hours for inspection by the Initial
Purchasers, any managing underwriter participating in any disposition pursuant
to such Registration Statement and any attorney or accountant retained by such
Initial Purchasers or any of the underwriter(s), all financial and other
records, pertinent corporate documents and properties of the Company and the
Guarantors and cause the Company’s and the Guarantors’ officers, directors and
employees to supply all information reasonably requested by any such Holder,
underwriter, attorney or accountant in connection with such Registration
Statement subsequent to the filing thereof and prior to its effectiveness;


 


(vii)         if requested by any selling Holders or
the underwriter(s), if any, promptly incorporate in any Registration Statement
or Prospectus, pursuant to a supplement or post-effective amendment if
necessary, such information as such selling Holders and underwriter(s), if any,
may reasonably request to have included therein, including, without limitation,
information relating to the “Plan of Distribution” of the Transfer Restricted
Securities, information with respect to the principal amount of Transfer
Restricted Securities being sold to such underwriter(s), the purchase price
being paid therefor and any other terms of the offering of the Transfer
Restricted Securities to be sold in such offering; and make all required
filings of such Prospectus supplement or post-effective amendment as soon as
practicable after the Company or a Guarantor is notified of the matters to be incorporated
in such Prospectus supplement or post-effective amendment;


 


11





















 


(viii)        furnish to each selling Holder and each
of the underwriter(s), if any, without charge, at least one copy of the
Registration Statement, as first filed with the Commission, and of each
amendment thereto, including financial statements and schedules, all documents
incorporated by reference therein and all exhibits (including exhibits
incorporated therein by reference);


 


(ix)           deliver to each selling Holder and
each of the underwriter(s), if any, without charge, as many copies of the
Prospectus (including each preliminary Prospectus) and any amendment or
supplement thereto as such Persons reasonably may request; the Company and the
Guarantors hereby consent to the use of the Prospectus and any amendment or
supplement thereto by each of the selling Holders and each of the
underwriter(s), if any, in connection with the offering and the sale of the
Transfer Restricted Securities covered by the Prospectus or any amendment or
supplement thereto;


 


(x)            in connection with any underwritten
offering of Transfer Restricted Securities pursuant to a Shelf Registration
Statement, enter into, and cause the Guarantors to enter into, such agreements
(including an underwriting agreement), and make, and cause the Guarantors to
make, such representations and warranties, and take all such other actions in
connection therewith reasonably necessary to expedite or facilitate the
disposition of the Transfer Restricted Securities, all to such extent as may be
reasonably requested by any Holder of Transfer Restricted Securities or
underwriter in connection with any sale or resale pursuant to underwritten
offerings of Transfer Restricted Securities pursuant to a Shelf Registration
Statement contemplated by this Agreement and shall:


 


(A)          furnish to each Initial Purchaser,
each selling Holder and each underwriter, if any, in such substance and scope
as they may reasonably request and as are customarily made by issuers to
underwriters in primary underwritten offerings, upon the date of the
Consummation of the Exchange Offer and, if applicable, the effectiveness of the
Shelf Registration Statement:


 


(1)           a certificate, dated the date of
effectiveness of the Shelf Registration Statement, signed by (y) the Chairman
of the Board, the Chief Executive Officer, President, any Executive Vice
President or any Vice President and (z) a principal financial or accounting
officer of each of the Company and Owens-Illinois Group, Inc., confirming, as
of the date thereof, the matters set forth in paragraphs (i) and (ii) of
Section 6(c) of the Purchase Agreement or such other matters as such parties
may reasonably request;


 


(2)           opinions, dated the date of
effectiveness of the Shelf Registration Statement of counsel for the Company
and the Guarantors, covering the matters set forth in paragraph (a) of Section
6 of the Purchase Agreement and Exhibits B and C referred to therein and such
other matters as such parties may reasonably request; and


 


12





















 


(3)           a customary comfort letter, dated as
of the date of effectiveness of the Shelf Registration Statement from the
Company’s independent accountants, in the customary form and covering matters
of the type customarily covered in comfort letters by underwriters in
connection with primary underwritten offerings, and affirming the matters set
forth in the comfort letter delivered pursuant to Section 6(e) of the Purchase
Agreement;


 


(B)           set forth in full or incorporate by
reference in the underwriting agreement, if any, indemnification provisions and
procedures of Section 8 hereof with respect to all parties to be indemnified
pursuant to said Section (or such other provisions or procedures acceptable to
selling Holders representing a majority in aggregate principal amount of
Transfer Restricted Securities covered by such Shelf Registration Statement and
the underwriters, if any); and


 


(C)           deliver such other documents and
certificates as may be reasonably requested by such parties to evidence
compliance with clause (A) above and with any customary conditions contained in
the underwriting agreement or other agreement entered into by the Company or
the Guarantors pursuant to this clause (x), if any.


 


If at any time the representations and
warranties of the Company and the Guarantors contemplated in clause (A)(1)
above cease to be true and correct in all material respects, the Company or the
Guarantors shall so advise the Initial Purchasers and the underwriter(s), if any,
and each selling Holder promptly and, if requested by such Persons, shall
confirm such advice in writing;


 


(xi)           prior to any public offering of
Transfer Restricted Securities, cooperate with the selling Holders, the
underwriter(s), if any, and their respective counsel in connection with the
registration and qualification of the Transfer Restricted Securities under the
securities or Blue Sky laws of such jurisdictions as the selling Holders or
underwriter(s) may request and do any and all other acts or things necessary or
advisable to enable the disposition in such jurisdictions of the Transfer
Restricted Securities covered by the Shelf Registration Statement; provided,
however, that neither the Company nor the Guarantors shall be required
to register or qualify as a foreign corporation where it is not then so
qualified or to take any action that would subject it to the service of process
in suits or to taxation, other than as to matters and transactions relating to
any Registration Statement, in any jurisdiction where it is not then so
subject;


 


(xii)          shall issue, upon the request of any
Holder of Securities covered by the Shelf Registration Statement, New
Securities, having an aggregate principal amount equal to the aggregate
principal amount of Securities surrendered to the Company by such Holder in
exchange therefor or being sold by such Holder; such New Securities to be
registered in the name of such Holder or in the name of the purchaser(s) of
such New Securities, as the case may be; in return, the Securities held by such
Holder shall be surrendered to the Company for cancellation;


 


13





















 


(xiii)         cooperate with the selling Holders and
the underwriter(s), if any, to facilitate the timely preparation and delivery
of certificates representing Transfer Restricted Securities to be sold and not
bearing any restrictive legends; and enable such Transfer Restricted Securities
to be in such denominations and registered in such names as the Holders or the
underwriter(s), if any, may request at least two Business Days prior to any
sale of Transfer Restricted Securities made by such underwriter(s);


 


(xiv)        use their commercially reasonable
efforts to cause the Transfer Restricted Securities covered by the Registration
Statement to be registered with or approved by such other governmental agencies
or authorities as may be necessary to enable the seller or sellers thereof or
the underwriter(s), if any, to consummate the disposition of such Transfer
Restricted Securities, subject to the proviso contained in clause (xi) above;


 


(xv)         if any fact or event contemplated by
clause 6(c)(iii)(D) above shall exist or have occurred, prepare a supplement or
post-effective amendment to the Registration Statement or related Prospectus or
any document incorporated therein by reference or file any other required
document so that, as thereafter delivered to the purchasers of Transfer
Restricted Securities, the Prospectus will not contain an untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein not misleading;


 


(xvi)        provide a CUSIP or Common Code number,
as applicable, and an ISIN number for all Transfer Restricted Securities and
all New Securities not later than the effective date of the Registration
Statement and provide the Trustee under the Indenture with printed certificates
for the Transfer Restricted Securities which are in a form eligible for deposit
with the Depositary Trust Company or Euroclear Bank S.A./N.V. or Clearstream
Banking, S.A., as applicable;


 


(xvii)       cooperate and assist in any filings
required to be made with the NASD and in the performance of any due diligence
investigation by any underwriter (including any “qualified independent
underwriter”) that is required to be retained in accordance with the rules and
regulations of the NASD, and use their commercially reasonable efforts to cause
such Registration Statement to become effective and approved by such
governmental agencies or authorities as may be necessary to enable the Holders
selling Transfer Restricted Securities to consummate the disposition of such
Transfer Restricted Securities;


 


(xviii)      otherwise use their commercially
reasonable efforts to comply with all applicable rules and regulations of the
Commission, and make generally available to the Company’s security holders, as
soon as practicable, a consolidated earnings statement meeting the requirements
of Rule 158 under the Act (which need not be audited) for the twelve-month
period (A) commencing at the end of any fiscal quarter in which Transfer
Restricted Securities are sold to underwriters in a firm or best efforts
Underwritten Offering or (B) if not sold to underwriters in such an offering,
beginning with the first month of the Company’s first fiscal quarter commencing
after the effective date of the Registration Statement;


 


14





















 


(xix)         cause the Indenture to be qualified
under the Trust Indenture Act not later than the effective date of the first
Registration Statement required by this Agreement, and, in connection
therewith, cooperate, and cause the Guarantors to cooperate with, with the
Trustee and the Holders of Notes to effect such changes to the Indenture as may
be required for such Indenture to be so qualified in accordance with the terms
of the Trust Indenture Act; in the event such qualification would require the
appointment of a new trustee under the Indenture, the Company shall appoint a
new trustee thereunder pursuant to the applicable provisions of Indenture; and
to execute, and use their commercially reasonable efforts to cause the Trustee
to execute, all documents that may be required to effect such changes and all
other forms and documents required to be filed with the Commission to enable
such Indenture to be so qualified in a timely manner; and


 


(xx)          provide promptly to each Holder upon
request each document filed with the Commission pursuant to the requirements of
Section 13 or Section 15 of the Exchange Act or provide each such requesting
Holder the location where such Holder can obtain such information without
charge.


 


Each Holder agrees by acquisition of a
Transfer Restricted Security that, upon receipt of any notice from the Company
or any Guarantor of the existence of any fact of the kind described in Section
6(c)(iii)(D) hereof, such Holder will forthwith discontinue disposition of
Transfer Restricted Securities pursuant to the applicable Registration
Statement until such Holder’s receipt of the copies of the supplemented or
amended Prospectus contemplated by Section 6(c)(xv) hereof, or until it is
advised in writing (the “Advice”) by the Company that the use of the
Prospectus may be resumed, and has received copies of any additional or
supplemental filings that are incorporated by reference in the Prospectus.  If so directed by the Company, each Holder
will deliver to the Company (at the Company’s expense) all copies, other than
permanent file copies then in such Holder’s possession, of the Prospectus
covering such Transfer Restricted Securities that was current at the time of
receipt of such notice.  In the event the
Company or any Guarantor shall give any such notice, the time period regarding
the effectiveness of such Registration Statement set forth in Section 3 or 4
hereof, as applicable, shall be extended by the number of days during the
period from and including the date of the giving of such notice pursuant to
Section 6(c)(iii)(D) hereof to and including the date when each selling Holder
covered by such Registration Statement shall have received the copies of the
supplemented or amended Prospectus contemplated by Section 6(c)(xv) hereof or
shall have received the Advice; however, no such extension shall be
taken into account in determining whether Additional Interest are due pursuant
to Section 5 hereof or the amount of such Additional Interest, it being agreed
that the Company’s and the Guarantor’s option to suspend use of a Registration
Statement pursuant to this paragraph shall be treated as a Registration Default
for purposes of Section 5.


 


7.             Registration Expenses.


 


(a)           All
expenses incident to the Company’s or the Guarantors’ performance of or
compliance with this Agreement will be borne by the Company or the Guarantors,
regardless of whether a Registration Statement becomes effective, including
without limitation: (i) all registration and filing fees and expenses
(including filings made by any Initial Purchaser or Holder with the NASD (and,
if applicable, the fees and expenses of any “qualified independent


 


15





















 


underwriter”
and its counsel that may be required by the rules and regulations of the
NASD)); (ii) all fees and expenses of compliance with federal securities and
state Blue Sky or securities laws; (iii) all expenses of printing (including
printing certificates for the New Securities to be issued in the Exchange Offer
and printing of Prospectuses), messenger and delivery services and telephone;
(iv) all fees and disbursements of counsel for the Company, the Guarantors and,
subject to Section 7(b) below, the Holders of Transfer Restricted Securities;
(v) all application and filing fees in connection with listing the New
Securities on a national securities exchange or automated quotation system
pursuant to the requirements thereof; and (vi) all fees and disbursements of
independent certified public accountants of the Company and the Guarantors
(including the expenses of any special audit and comfort letters required by or
incident to such performance).


 


The Company and the Guarantors will, in any
event, bear their internal expenses (including, without limitation, all
salaries and expenses of their officers and employees performing legal or
accounting duties), the expenses of any annual audit and the fees and expenses
of any Person, including special experts, retained by the Company or the
Guarantors.


 


(b)           In
connection with any Registration Statement required by this Agreement
(including, without limitation, the Exchange Offer Registration Statement and
the Shelf Registration Statement), the Company and the Guarantors will
reimburse the Initial Purchasers and the Holders of Transfer Restricted
Securities being tendered in the Exchange Offer and/or resold pursuant to the “Plan
of Distribution” contained in the Exchange Offer Registration Statement or
registered pursuant to the Shelf Registration Statement, as applicable, for the
reasonable fees and disbursements of not more than one counsel, who shall be
Simpson Thacher & Bartlett LLP or such other counsel as may be chosen by the
Holders of a majority in principal amount of the Transfer Restricted Securities
for whose benefit such Registration Statement is being prepared.


 


8.             Indemnification.


 


(a)           Indemnification
of the Holders.  The Company and each
Guarantor, jointly and severally, agree to indemnify and hold harmless each
Holder, its directors, officers and employees, and each person, if any, who
controls any Holder within the meaning of the Act and the Exchange Act against
any loss, claim, damage, liability or expense, as incurred, to which such
Holder or such controlling person may become subject, under the Act, the
Exchange Act or other federal or state statutory law or regulation, or at
common law or otherwise (including in settlement of any litigation, if such
settlement is effected with the written consent of the Company or
Owens-Illinois Group, Inc.), insofar as such loss, claim, damage, liability or
expense (or actions in respect thereof as contemplated below) arises out of or
is based upon any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement or Prospectus, or the omission or
alleged omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that the foregoing
indemnity agreement shall not apply to any loss, claim, damage, liability or
expense to the extent, but only to the extent, arising out of or based upon any
untrue statement or alleged untrue statement or omission or alleged omission
made in reliance upon and in conformity with written information furnished to
the Company by the Holders expressly for use in any Registration Statement or
Prospectus;


 


16





















 


provided,
further, that the foregoing indemnity agreement shall not inure to the
benefit of any Holder, its directors, officers and employees, and each person,
if any, who controls such Holder within the meaning of the Act and the Exchange
Act, who, in contravention of a requirement of applicable law, failed to
deliver, or otherwise convey the information contained in, any Prospectus (as
then amended or supplemented) to the person asserting any losses, claims,
damages, liabilities or expenses, caused by any untrue statement or alleged
untrue statement of a material fact contained in any preliminary Prospectus, or
caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not misleading,
if such material misstatement or omission or alleged material misstatement or
omission was cured in the Prospectus (as then amended or supplemented) and such
Prospectus was required by law to be delivered at or prior to the written
confirmation of sale to such person and the Prospectus and any amendment or
supplement thereto was provided by the Company to the Holder in the requisite
quantity and on a timely basis to permit proper delivery on or prior to the
closing of such sale by such Holder.  The
indemnity agreement set forth in this Section 8 shall be in addition to any
liabilities that the Company or any of the Guarantors may otherwise have.


 


(b)           Indemnification
of the Company, the Guarantors and their Directors and Officers.  Each Holder agrees, severally and not
jointly, to indemnify and hold harmless the Company and the Guarantors and each
of their respective directors, and each person, if any, who controls the
Company or the Guarantors, as the case may be, within the meaning of the Act or
the Exchange Act, against any loss, claim, damage, liability or expense, as
incurred, to which the Company or such Guarantor or any such director, or
controlling person may become subject, under the Act, the Exchange Act, or
other federal or state statutory law or regulation, or at common law or
otherwise (including in settlement of any litigation, if such settlement is
effected with the written consent of such Holder), insofar as such loss, claim,
damage, liability or expense (or actions in respect thereof as contemplated
below) arises out of or is based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement or
Prospectus, or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in any Registration
Statement or Prospectus, in reliance upon and in conformity with written
information furnished to the Company by the Holders expressly for use therein;
and to reimburse the Company and the Guarantors, or any such director or controlling
person for any legal and other expenses reasonably incurred by the Company and
the Guarantors, or any such director or controlling person in connection with
investigating, defending, settling, compromising or paying any such loss,
claim, damage, liability, expense or action. 
The indemnity agreement set forth in this Section 8 shall be in addition
to any liabilities that each Holder may otherwise have.  In no event shall the liability of any
selling Holder hereunder be greater in amount than the dollar amount of
proceeds received by such Holder upon the sale of the Securities giving rise to
such indemnification obligation.


 


(c)           Notifications
and Other Indemnification Procedures. 
Promptly after receipt by any person in respect of which indemnity may
be sought pursuant to Section 8(a) or 8(b) (the “indemnified party”) of
notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against any person against whom 


 


17





















 


indemnity may be sought
pursuant to Section 8(a) or 8(b) (the “indemnifying party”), notify the
indemnifying party in writing of the commencement thereof, but the omission so
to notify the indemnifying party will not relieve it from any liability which
it may have to any indemnified party for contribution or otherwise than under
the indemnity agreement contained in this Section 8 or to the extent it is not
prejudiced as a proximate result of such failure.  In case any such action is brought against
any indemnified party and such indemnified party seeks or intends to seek
indemnity from an indemnifying party, the indemnifying party shall be entitled
to participate in and, to the extent that it shall elect, jointly with all
other indemnifying parties similarly notified, by written notice delivered to
the indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party; provided, however, if the
defendants in any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded,
based on the advice of legal counsel, that a conflict may arise between the
positions of the indemnifying party and the indemnified party in conducting the
defense of any such action or that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to
those available to the indemnifying party, the indemnified party or parties
shall have the right to select separate counsel to assume such legal defenses
and to otherwise participate in the defense of such action on behalf of such
indemnified party or parties.  Upon
receipt of notice from the indemnifying party to such indemnified party of such
indemnifying party’s election so to assume the defense of such action and
approval by the indemnified party of counsel, the indemnifying party shall not
be liable to such indemnified party under this Section 8 for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof unless the indemnified party shall have employed separate
counsel in accordance with the proviso to the next preceding sentence (it being
understood, however, that the indemnifying party shall not be liable for the
expenses of more than one separate counsel (together with local counsel),
approved by the indemnifying party, representing the indemnified parties who
are parties to such action) or (ii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action, in each of which cases the fees and expenses of counsel shall be at the
expense of the indemnifying party.


 


(d)           Settlements.  The indemnifying party under this Section 8
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party against any loss, claim, damage, liability or expense by
reason of such settlement or judgment. 
Notwithstanding the foregoing sentence, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel as contemplated by this Section 8, the
indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not have reimbursed
the indemnified party in accordance with such request prior to the date of such
settlement.  No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement, compromise or consent to the entry of judgment in any pending or threatened
action, suit or proceeding in respect of which any indemnified party is or
could have been a party and indemnity was or could have been sought hereunder
by such indemnified party, 


 


18





















 


unless such settlement,
compromise or consent includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such action,
suit or proceeding.


 


(e)           Contribution.  If the indemnification provided for in this
Section 8 is for any reason held to be unavailable to or otherwise insufficient
to hold harmless an indemnified party under Section 8(a) or Section 8(b) hereof
(other than by reason of exceptions provided in those Sections) in respect of
any losses, claims, damages, liabilities or expenses referred to therein, then
each indemnifying party shall contribute to the aggregate amount paid or
payable by such indemnified party, as incurred, as a result of any losses,
claims, damages, liabilities or expenses referred to therein (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Guarantors, on the one hand, and the Holders, on the other
hand, from the Initial Placement (which, in the case of the Company and the
Guarantors shall be deemed to be equal to the total gross proceeds from the
Initial Placement as set forth on the cover page to the Final Memorandum), the
amount of Additional Interest which did not become payable as a result of the
filing of the Registration Statement resulting in such losses, claims, damages,
liabilities, judgments actions or expenses, and such Registration Statement, or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault
of the Company and the Guarantors, on the one hand, and the Holders, on the
other hand, in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations.  The relative
benefits received by the Company and the Guarantors, on the one hand, and the
Holders, on the other, with respect to such offering shall be deemed to be in
the same proportion as the total net proceeds from the Initial Placement
(before deducting expenses) received by the Company and the Guarantors, on the
one hand, and the total net proceeds received by such Holder upon its resale of
Notes less the amount paid by such Holder for such Notes, on the other hand,
bear to the total sum of such amounts. 
The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company and the Guarantors or such Holder, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. 
For the purposes of the preceding two sentences, the net proceeds deemed
to be received by the Company shall be deemed to be also for the benefit of the
Guarantors and the information supplied by the Company shall also be deemed to
have been supplied by the Guarantors.


 


The amount paid or payable by a party as a
result of the losses, claims, damages, liabilities and expenses referred to
above shall be deemed to include, subject to the limitations set forth in
Section 8(a), any legal or other fees or expenses reasonably incurred by such
party in connection with investigating or defending any action or claim.  The provisions set forth in this Section 8
with respect to notice of commencement of any action shall apply if a claim for
contribution is to be made under this Section 8(e); provided, however,
that no additional notice shall be required with respect to any action for
which notice has been given under this Section 8 for purposes of
indemnification.


 


19





















 


The Company, the Guarantors and the Holders
agree that it would not be just and equitable if contribution pursuant to this
Section 8(e) were determined by pro rata allocation (even if the Holders were
treated as one entity for such purpose) or by any other method of allocation
which does not take account of the equitable considerations referred to in this
Section 8(e).  Notwithstanding the
provisions of this Section 8(e), no Holder shall be required to contribute any
amount in excess of the amount by which the total net proceeds received by such
Holder upon its resale of Notes exceeds the sum of the amount paid by such
Holder for such Notes (or, if such Notes have not been sold by such Holder, the
total discount received by such Holder with respect to such Notes) and the
amount of any damages which such Holder has otherwise paid or become liable to
pay by reason of any untrue or alleged untrue statement or omission or alleged
omission.  No person guilty of fraudulent
misrepresentation (within the meaning of Section 11 of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.  The Holders’
obligations to contribute pursuant to this Section 8(e) are several, and not
joint, in proportion to the respective principal amount of Notes held by each
of the Holders hereunder.  For purposes
of this Section 8(e), each director, officer and employee of an Holder and each
person, if any, who controls an Holder within the meaning of the Act and the
Exchange Act shall have the same rights to contribution as such Holder, and
each director of the Company and the Guarantors, and each person, if any, who
controls the Company with the meaning of the Act and the Exchange Act shall
have the same rights to contribution as the Company and the Guarantors.


 


(f)            The
remedies provided for in this Section 8 are not exclusive and shall not limit
any rights or remedies which may otherwise be available to any indemnified
party at law or in equity.


 


9.             Rule 144A.


 


The Company and the Guarantors each hereby
agree with each Holder, for so long as any Transfer Restricted Securities
remain outstanding, to make available to any Holder or beneficial owner of
Transfer Restricted Securities in connection with any sale thereof and any
prospective purchaser of such Transfer Restricted Securities from such Holder
or beneficial owner, the information required by Rule 144A(d)(4) under the Act
in order to permit resales of such Transfer Restricted Securities pursuant to
Rule 144A.


 


10.           Participation In Underwritten Registrations.


 


No Holder may participate in any Underwritten
Registration hereunder unless such Holder (a) agrees to sell such Holder’s
Transfer Restricted Securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and (b)
completes and executes all reasonable questionnaires, powers of attorney,
indemnities, underwriting agreements, lock-up letters and other documents
required under the terms of such underwriting arrangements.


 


11.           Selection Of Underwriters.


 


The Holders of Transfer Restricted Securities
covered by the Shelf Registration Statement who desire to do so may sell such
Transfer Restricted Securities in an Underwritten


 


20





















 


Offering. 
In any such Underwritten Offering, the investment banker or investment
bankers and manager or managers that will administer the offering shall be
selected by the Holders of a majority in aggregate principal amount of the
Transfer Restricted Securities included in such offering; provided, that
such investment bankers and managers must be reasonably satisfactory to the
Company.


 


12.           Miscellaneous.


 


(a)           Remedies.  The Company and the Guarantors each hereby
agree that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by it of the provisions of this Agreement and
hereby agree to waive the defense in any action for specific performance that a
remedy at law would be adequate.


 


(b)           No
Inconsistent Agreements.  The Company
shall not, and shall cause the Guarantors not to, on or after the date of this
Agreement enter into any agreement with respect to the Company’s securities
that would prevent the Company or any Guarantor from satisfying its obligations
hereunder or that would otherwise conflict with the provisions hereof.  Other than the Registration Rights Agreement
dated as of January 24, 2002 with respect to the Company’s 8 7/8%
Senior Secured Notes due 2009, the Registration Rights Agreement dated as of
November 13, 2002 with respect to the Company’s outstanding 83⁄4% Senior Secured
Notes due 2012, the Registration Rights Agreement dated December 18, 2002
with respect to the Company’s outstanding 83⁄4% Senior Notes due 2012, the
Registration Rights Agreement dated May 6, 2003 with respect to the Company’s
73⁄4% Senior Secured Notes due 2011, the Registration Rights Agreement dated May
6, 2003 with respect to the Company’s 81⁄4% Senior Notes due 2013 and the
Registration Rights Agreement dated the date hereof with respect to the Company’s
63⁄4 % Senior Notes due 2014 issued concurrently with the Notes, neither the
Company nor any of the Guarantors has entered into any agreement granting any
registration rights with respect to the Company’s securities to any Person. The
rights granted to the Holders hereunder do not in any way conflict with and are
not inconsistent with the rights granted to the holders of the Company’s
securities under any agreement in effect on the date hereof.


 


(c)           Adjustments
Affecting the Securities.  Neither
the Company nor the Guarantors shall take any action, or permit any change to
occur, with respect to the Securities that would materially and adversely
affect the ability of the Holders to Consummate any Exchange Offer.


 


(d)           Amendments
and Waivers.  The provisions of this
Agreement may not be amended, modified or supplemented, and waivers or consents
to or departures from the provisions hereof may not be given unless the Company
has obtained the written consent of Holders of a majority of the outstanding
principal amount of Transfer Restricted Securities.  Notwithstanding the foregoing, a waiver or
consent to departure from the provisions hereof that relates exclusively to the
rights of Holders whose securities are being tendered pursuant to the Exchange
Offer and that does not affect directly or indirectly the rights of other
Holders whose securities are not being tendered pursuant to such Exchange Offer
may be given by the Holders of a majority of the outstanding principal amount
of Transfer Restricted Securities being tendered or registered; provided
that, with respect to any matter that directly or indirectly affects the
rights of any Initial Purchaser hereunder, the Company shall obtain the written
consent of 


 


21





















 


each such Initial
Purchaser with respect to which such amendment, qualification, supplement,
waiver, consent or departure is to be effective.


 


(e)           Notices.  All notices and other communications provided
for or permitted hereunder shall be made in writing by hand-delivery,
first-class mail (registered or certified, return receipt requested), telex,
telecopier, or air courier guaranteeing overnight delivery:


 


(i)            if to a Holder, at the address set
forth on the records of the Registrar under the Indenture, with a copy to the
Registrar under the Indenture; and


 


(ii)           if to the Company:


 


Owens-Brockway Glass Container Inc. 

One SeaGate

Toledo, OH 43666

Telecopier No.: 419-247-1218

Attention:  Treasurer


 


With a copy to:


 


Latham & Watkins

505 Montgomery Street, Suite 1900

San Francisco, CA 94111

Telecopier No.: 415-395-8095

Attention:  Tracy K. Edmonson, Esq.


 


All such notices and communications shall be
deemed to have been duly given:  at the
time delivered by hand, if personally delivered; five Business Days after being
deposited in the mail, postage prepaid, if mailed; when answered back, if
telexed; when receipt acknowledged, if telecopied; and on the next Business
Day, if timely delivered to an air courier guaranteeing overnight delivery.


 


Copies of all such notices, demands or other
communications shall be concurrently delivered by the Person giving the same to
the Trustee at the address specified in the Indenture.


 


(f)            Successors
and Assigns.  This Agreement shall
inure to the benefit of and be binding upon the successors and assigns of each
of the parties, including without limitation and without the need for an
express assignment, subsequent Holders of Transfer Restricted Securities; provided,
however, that this Agreement shall not inure to the benefit of or be
binding upon a successor or assign of a Holder unless and to the extent such
successor or assign acquired Transfer Restricted Securities from such Holder.


 


(g)           Counterparts.  This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.


 


22





















 


(h)           Headings.  The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.


 


(i)            Severability.  In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby.


 


(j)            Entire
Agreement.  This Agreement is
intended by the parties as a final expression of their agreement and intended
to be a complete and exclusive statement of the agreement and understanding of
the parties hereto in respect of the subject matter contained herein.  There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted by the Company and the
Guarantors with respect to the Transfer Restricted Securities.  This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.


 


(k)           GOVERNING
LAW.  THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.


 


(l)            Securities
Held by the Company, etc.  Whenever
the consent or approval of Holders of a specified percentage of principal
amount of Securities or New Securities is required hereunder, Securities or New
Securities, as applicable, held by the Company or its Affiliates (other than
subsequent Holders of Securities or New Securities if such subsequent Holders
are deemed to be Affiliates solely by reason of their holdings of such
Securities or New Securities) shall not be counted in determining whether such
consent or approval was given by the Holders of such required percentage.


 


23





















 


If the foregoing is in accordance with your
understanding of our agreement, please sign and return to us the enclosed
duplicate hereof, whereupon this letter and your acceptance shall represent a
building agreement among the Company, each of the Guarantors and the several
Initial Purchasers.


 


	
   

  	
  Very truly yours,

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  OWENS-BROCKWAY GLASS
  CONTAINER INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  James W. Baehren

  	
   

  
	
   

  	
   

  	
  Name:

  	
  James W. Baehren

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  On behalf of each entity named on the attached

  Exhibit A, in the capacity
  set forth for such entity

  on such Exhibit
  A

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  James W. Baehren

  	
   

  
	
   

  	
  Name:  James W. Baehren

  	
   

  
							



 


 


 


[Registration
Rights Agreement Signature Page]


 





















 


The foregoing
Agreement is hereby confirmed and

accepted as of the
date first above written.


 


	
  GOLDMAN,
  SACHS & CO.

  	
   

  
	
  CITIGROUP
  GLOBAL MARKETS INC.

  	
   

  
	
   

  
	
   

  
	
  By:

  	
  GOLDMAN,
  SACHS & CO.

  
	
   

  	
   

  
	
  By:

  	
  /s/ Goldman,
  Sachs & Co.

  	
   

  
	
   

  	
  (Goldman,
  Sachs & Co.)

  	
   

  
				



 


For themselves
and the other several

Initial Purchasers named in

Schedule I-A and Schedule I-B to the foregoing

Agreement.


 


 


[Registration
Rights Agreement Signature Page]


 





















 


Exhibit A


 


	
  Name of Entity

  	
   

  	
  Title of
  Officer Executing

  on Behalf of Such Entity

  
	
   

  	
   

  	
   

  
	
  ACI
  America Holdings Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Brockway
  Realty Corporation

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Brockway
  Research, Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  NHW
  Auburn, LLC

  	
   

  	
  Senior
  Vice President and Secretary of its sole member

  
	
   

  	
   

  	
   

  
	
  OB
  Cal South, Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  AID STS Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  Auburn Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  Australia Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  Brazil Closure Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  California Containers Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  Castalia STS Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  Consol STS Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  Europe & Asia Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  General Finance Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  General FTS Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  O-I
  Health Care Holding Corp.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  O-I
  Holding Company, Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  International Holdings Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  Levis Park STS Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  Medical Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OI
  Plastic Products FTS Inc.

  	
   

  	
  Vice
  President and Secretary

  



 





















 


	
  Name of Entity

  	
   

  	
  Title of
  Officer Executing

  on Behalf of Such Entity

  
	
   

  	
   

  	
   

  
	
  OI
  Puerto Rico STS Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  OIB
  Produvisa Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Overseas
  Finance Company

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Owens-Brockway
  Glass Container Trading Company

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Owens-Brockway
  Packaging, Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Owens-Illinois
  Closure Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Owens-Illinois
  General Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Owens-Illinois
  Group, Inc.

  	
   

  	
  Vice
  President, Director of Finance and Secretary

  
	
   

  	
   

  	
   

  
	
  Owens-Illinois
  Healthcare Packing Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Owens-Illinois
  Prescription Products Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Product
  Design & Engineering, Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Seagate,
  Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Seagate
  II, Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Seagate
  III, Inc.

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Specialty
  Packaging Licensing Company

  	
   

  	
  Vice
  President and Secretary

  
	
   

  	
   

  	
   

  
	
  Universal
  Materials, Inc

  	
   

  	
  Vice
  President and Secretary

  



 


2





















 


SCHEDULE I-A


 


	
  Initial
  Purchasers

  	
   

  	
  Principal
  Amount of 

  Euro Notes

  to Be Purchased

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Goldman, Sachs & Co.

  	
   

  	
  Euro€

  	
  56,250,000

  	
   

  
	
  Citigroup Global
  Markets Inc.

  	
   

  	
   

  	
  56,250,000

  	
   

  
	
  Banc of America
  Securities Limited

  	
   

  	
   

  	
  21,093,750

  	
   

  
	
  BNP Paribas

  	
   

  	
   

  	
  21,093,750

  	
   

  
	
  Deutsche Bank
  AG, London Branch

  	
   

  	
   

  	
  21,093,750

  	
   

  
	
  Scotia Capital
  Inc.

  	
   

  	
   

  	
  21,093,750

  	
   

  
	
  J.P. Morgan
  Securities Ltd.

  	
   

  	
   

  	
  14,062,500

  	
   

  
	
  CALYON.

  	
   

  	
   

  	
  14,062,500

  	
   

  
	
  Total

  	
   

  	
  Euro€

  	
  225,000,000

  	
   

  



 





















 


SCHEDULE I-B


 


	
  Initial
  Purchasers

  	
   

  	
  Principal
  Amount of

  Dollar Notes

  to Be Purchased

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Goldman, Sachs & Co.

  	
   

  	
  US$

  	
  100,000,000

  	
   

  
	
  Citigroup Global
  Markets Inc.

  	
   

  	
  100,000,000

  	
   

  
	
  Banc of America
  Securities LLC

  	
   

  	
  37,500,000

  	
   

  
	
  BNP Paribas
  Securities Corp.

  	
   

  	
  37,500,000

  	
   

  
	
  Deutsche Bank
  Securities Inc.

  	
   

  	
  37,500,000

  	
   

  
	
  Scotia Capital
  (USA) Inc.

  	
   

  	
  37,500,000

  	
   

  
	
  J.P. Morgan
  Securities Inc.

  	
   

  	
  25,000,000

  	
   

  
	
  Calyon
  Securities (USA) Inc.

  	
   

  	
  25,000,000

  	
   

  
	
  Total

  	
   

  	
  US$

  	
  400,000,000