Indenture, dated 12/16/03



  
 EXHIBIT 4.1 

 
 EXECUTION COPY 
  

  
 WMC Finance Co. 
 Issuer 
  
 113⁄4% Senior Notes due 2008 
  

  
 INDENTURE 
  
 Dated as of December 16, 2003 
  

  
 JPMorgan Chase Bank 
 Trustee 
  








 CROSS-REFERENCE TABLE 
  

			
	 TIA Section

	  	Indenture
Section


	 310(a)(1)
	  	7.10
	       (a)(2)
	  	7.10
	       (a)(3)
	  	N.A.
	       (a)(4)
	  	N.A.
	       (b)
	  	7.08; 7.10
	       (c)
	  	N.A.
	 311(a)
	  	7.11
	       (b)
	  	7.11
	       (c)
	  	N.A.
	 312(a)
	  	2.05
	       (b)
	  	10.03
	       (c)
	  	10.03
	 313(a)
	  	7.06
	       (b)(1)
	  	N.A.
	       (b)(2)
	  	7.06
	       (c)
	  	10.02
	       (d)
	  	7.06
	 314(a)
	  	4.02;
	 	  	4.09; 10.02
	       (b)
	  	N.A.
	       (c)(1)
	  	10.04
	       (c)(2)
	  	10.04
	       (c)(3)
	  	N.A.
	       (d)
	  	N.A.
	       (e)
	  	10.05
	       (f)
	  	4.09
	 315(a)
	  	7.01
	       (b)
	  	7.05; 10.02
	       (c)
	  	7.01
	       (d)
	  	7.01
	       (e)
	  	6.11
	 316(a)(last sentence)
	  	10.06
	       (a)(1)(A)
	  	6.05
	       (a)(1)(B)
	  	6.04
	       (a)(2)
	  	N.A.
	       (b)
	  	6.07
	 317(a)(1)
	  	6.08
	       (a)(2)
	  	6.09
	       (b)
	  	2.04
	 318(a)
	  	10.01

  
 N.A. means Not Applicable.


 Note: This Cross-Reference Table shall not, for any purpose, be deemed to be part of the
Indenture. 
  









 TABLE OF CONTENTS 
  

					
	 	  	 	  	Page


	
	 Article 1
  
 Definitions and Incorporation by Reference

			
	 SECTION 1.01
	  	 Definitions
	  	1
	 SECTION 1.02
	  	 Other Definitions
	  	39
	 SECTION 1.03
	  	 Incorporation by Reference of Trust Indenture Act
	  	39
	 SECTION 1.04
	  	 Rules of Construction
	  	40
	
	 Article 2
  
 The Securities

			
	 SECTION 2.01
	  	 Form and Dating
	  	41
	 SECTION 2.02
	  	 Execution and Authentication
	  	41
	 SECTION 2.03
	  	 Registrar and Paying Agent
	  	42
	 SECTION 2.04
	  	 Paying Agent To Hold Money in Trust
	  	43
	 SECTION 2.05
	  	 Securityholder Lists
	  	43
	 SECTION 2.06
	  	 Transfer and Exchange
	  	43
	 SECTION 2.07
	  	 Replacement Securities
	  	43
	 SECTION 2.08
	  	 Outstanding Securities
	  	44
	 SECTION 2.09
	  	 Temporary Securities
	  	44
	 SECTION 2.10
	  	 Cancellation
	  	45
	 SECTION 2.11
	  	 Defaulted Interest
	  	45
	 SECTION 2.12
	  	 CUSIP and ISIN Numbers
	  	45
	 SECTION 2.13
	  	 Issuance of Additional Securities
	  	45
	
	 Article 3
  
 Redemption

			
	 SECTION 3.01
	  	 Notices to Trustee
	  	46
	 SECTION 3.02
	  	 Selection of Securities to Be Redeemed
	  	47
	 SECTION 3.03
	  	 Notice of Redemption
	  	47
	 SECTION 3.04
	  	 Effect of Notice of Redemption
	  	48
	 SECTION 3.05
	  	 Deposit of Redemption Price
	  	48
	 SECTION 3.06
	  	 Securities Redeemed in Part
	  	49
	
	 Article 4
  
 Covenants

			
	 SECTION 4.01
	  	 Payment of Securities
	  	49

  

 i 









					
	 SECTION 4.02
	  	 SEC Reports
	  	49
	 SECTION 4.03
	  	 Limitation on Indebtedness
	  	51
	 SECTION 4.04
	  	 Limitation on Restricted Payments
	  	53
	 SECTION 4.05
	  	 Limitation on Restrictions on Distributions from Restricted Subsidiaries
	  	59
	 SECTION 4.06
	  	 Limitation on Sales of Assets and Subsidiary Stock
	  	62
	 SECTION 4.07
	  	 Limitation on Affiliate Transactions
	  	66
	 SECTION 4.08
	  	 Limitation on the Sale or Issuance of Capital Stock of Restricted Subsidiaries
	  	68
	 SECTION 4.09
	  	 Change of Control
	  	68
	 SECTION 4.10
	  	 Limitation on Liens
	  	70
	 SECTION 4.11
	  	 Limitation on Sale/Leaseback Transactions
	  	70
	 SECTION 4.12
	  	 Limitation on Investment Company Status
	  	71
	 SECTION 4.13
	  	 Compliance Certificate
	  	71
	 SECTION 4.14
	  	 Further Instruments and Acts
	  	71
	
	 Article 5
  
 Successor Company

			
	 SECTION 5.01
	  	 When Company May Merge or Transfer Assets
	  	72
	
	 Article 6
  
 Defaults and Remedies

			
	 SECTION 6.01
	  	 Events of Default
	  	73
	 SECTION 6.02
	  	 Acceleration
	  	76
	 SECTION 6.03
	  	 Other Remedies
	  	76
	 SECTION 6.04
	  	 Waiver of Past Defaults
	  	77
	 SECTION 6.05
	  	 Control by Majority
	  	77
	 SECTION 6.06
	  	 Limitation on Suits
	  	77
	 SECTION 6.07
	  	 Rights of Holders to Receive Payment
	  	78
	 SECTION 6.08
	  	 Collection Suit by Trustee
	  	78
	 SECTION 6.09
	  	 Trustee May File Proofs of Claim
	  	78
	 SECTION 6.10
	  	 Priorities
	  	79
	 SECTION 6.11
	  	 Undertaking for Costs
	  	79
	 SECTION 6.12
	  	 Waiver of Stay or Extension Laws
	  	79
	
	 Article 7
  
 Trustee

			
	 SECTION 7.01
	  	 Duties of Trustee
	  	80
	 SECTION 7.02
	  	 Rights of Trustee
	  	81

  

 ii 









					
	 SECTION 7.03
	  	 Individual Rights of Trustee
	  	82
	 SECTION 7.04
	  	 Trustee’s Disclaimer
	  	83
	 SECTION 7.05
	  	 Notice of Defaults
	  	83
	 SECTION 7.06
	  	 Reports by Trustee to Holders
	  	83
	 SECTION 7.07
	  	 Compensation and Indemnity
	  	83
	 SECTION 7.08
	  	 Replacement of Trustee
	  	84
	 SECTION 7.09
	  	 Successor Trustee by Merger
	  	86
	 SECTION 7.10
	  	 Eligibility; Disqualification
	  	86
	 SECTION 7.11
	  	 Preferential Collection of Claims Against Company
	  	86
	
	 Article 8
  
 Discharge of Indenture; Defeasance

			
	 SECTION 8.01
	  	 Discharge of Liability on Securities; Defeasance
	  	87
	 SECTION 8.02
	  	 Conditions to Defeasance
	  	88
	 SECTION 8.03
	  	 Application of Trust Money
	  	89
	 SECTION 8.04
	  	 Repayment to Company
	  	89
	 SECTION 8.05
	  	 Indemnity for Government Obligations
	  	90
	 SECTION 8.06
	  	 Reinstatement
	  	90
	
	 Article 9
  
 Amendments

			
	 SECTION 9.01
	  	 Without Consent of Holders
	  	90
	 SECTION 9.02
	  	 With Consent of Holders
	  	91
	 SECTION 9.03
	  	 Compliance with Trust Indenture Act
	  	92
	 SECTION 9.04
	  	 Revocation and Effect of Consents and Waivers
	  	93
	 SECTION 9.05
	  	 Notation on or Exchange of Securities
	  	93
	 SECTION 9.06
	  	 Trustee To Sign Amendments
	  	93
	 SECTION 9.07
	  	 Payment for Consent
	  	94
	
	 Article 10
  
 Miscellaneous

			
	 SECTION 10.01
	  	 Trust Indenture Act Controls
	  	94
	 SECTION 10.02
	  	 Notices
	  	94
	 SECTION 10.03
	  	 Communication by Holders with Other Holders
	  	95
	 SECTION 10.04
	  	 Certificate and Opinion as to Conditions Precedent
	  	95
	 SECTION 10.05
	  	 Statements Required in Certificate or Opinion
	  	96

  

 iii 









					
	 SECTION 10.06
	  	 When Securities Disregarded
	  	96
	 SECTION 10.07
	  	 Rules by Trustee, Paying Agent and Registrar
	  	97
	 SECTION 10.08
	  	 Legal Holidays
	  	97
	 SECTION 10.09
	  	 Governing Law
	  	97
	 SECTION 10.10
	  	 No Recourse Against Others
	  	97
	 SECTION 10.11
	  	 Successors
	  	97
	 SECTION 10.12
	  	 Multiple Originals
	  	97
	 SECTION 10.13
	  	 Table of Contents; Headings
	  	97

  
 Rule
144A/Regulation S/IAI Appendix 
  

			
		
	Exhibit 1   –	 	Form of Initial Security
		
	Exhibit A  –	 	Form of Exchange Security or Private Exchange Security
		
	Exhibit 2   –	 	Form of Transferee Letter of Representation

  

 iv 








 INDENTURE dated as of December 16, 2003, between WMC FINANCE CO., a Delaware corporation
(the “Company”), and JPMORGAN CHASE BANK, a New York banking corporation (the “Trustee”). 
  
 Each party agrees as follows for the benefit of the other party and for the equal and ratable benefit of the Holders of the Company’s Initial
Securities, Exchange Securities and Private Exchange Securities (collectively, the “Securities”): 
  
 Article 1 
  
 Definitions and Incorporation by Reference 
  
 SECTION 1.01 Definitions.  
  
 “Additional Assets” means (1) any property, plant or equipment used in a Related Business; (2) the Capital Stock of a Person that becomes a Restricted Subsidiary as a result of the acquisition of such Capital Stock by the Company
or another Restricted Subsidiary; or (3) Capital Stock constituting a minority interest in any Person that at such time is a Restricted Subsidiary; provided, however, that any such Restricted Subsidiary described in clause (2) or (3)
above is primarily engaged in a Related Business. 
  
 “Additional Securities” means, subject to the Company’s compliance with Section 4.03, 113⁄4% Senior Notes due 2008 issued from time to time after the Issue Date under the terms of this Indenture (other than pursuant to
Section 2.06, 2.07, 2.09 or 3.06 of this Indenture and other than Exchange Securities or Private Exchange Securities issued pursuant to an exchange offer for other Securities outstanding under this Indenture). 
  
 “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” when used with respect to any Person means 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. For purposes of Sections 4.04, 4.06 and 4.07
only, “Affiliate” shall also mean any beneficial owner of Capital Stock representing 10% or more of the total voting power of the Voting Stock (on a fully diluted basis) of the Company or of rights or warrants to purchase such Capital
Stock (whether or not currently exercisable) and any Person who would be an Affiliate of any such beneficial owner pursuant to the first sentence of this definition. 
  
 “Asset Disposition” means any sale, lease, transfer or other disposition (or series of related sales, leases,
transfers or dispositions) by the Company or any Restricted Subsidiary, including any disposition by means of a merger, consolidation or similar transaction (each referred to for the purposes of this definition as a “disposition”), of:

  
 (1) any shares of Capital Stock of a
Restricted Subsidiary (other than directors’ qualifying shares or shares required by applicable law to be held by a Person other than the Company or a Restricted Subsidiary); 
  
 (2) all or substantially all the assets of any division or line of business of the Company or any Restricted
Subsidiary; 
  
 (3) any other assets of the
Company or any Restricted Subsidiary outside of the ordinary course of business of the Company or such Restricted Subsidiary; or 
  
 (4) any Excess Spread Receivables (other than any such Excess Spread Receivable in the form of a certificated security rated by a Rating
Agency); 
  
 other than, in the case of clauses (1), (2), (3) and (4) above: (A) a
disposition by a Restricted Subsidiary to the Company or by the Company or a Restricted Subsidiary to a Wholly Owned Subsidiary; (B) for purposes of Section 4.06 only, (i) a disposition that constitutes a Restricted Payment (or would constitute a
Restricted Payment but for the exclusions from the definition thereof) and that is not prohibited by Section 4.04 and (ii) a disposition of all or substantially all the assets of the Company in accordance with Section 5.01; (C) a disposition of
assets with a fair 

  

 2 








 
market value of less than $1,000,000; (D) a disposition of cash or Temporary Cash Investments; (E) the creation of a Lien (but not the sale or other
disposition of the property subject to such Lien); (F) sales or grants of licenses to use the Company’s or any Restricted Subsidiary’s patents, trade secrets, know-how or technology to the extent that such license does not prohibit the
licensor from using the patent, trade secret, know-how or technology; and (G) the disposition of any Capital Stock or other ownership interest in or assets or property of an Unrestricted Subsidiary. 
  
 “Attributable Debt” in respect of a Sale/Leaseback Transaction
means, as at the time of determination, the present value (discounted at the interest rate implicit in such transaction, determined in accordance with GAAP) 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); provided, however, that if such Sale/Leaseback Transaction results in a Capital Lease Obligation, the amount of
Indebtedness represented thereby will be determined in accordance with the definition of “Capital Lease Obligation”. 
  
 “Average Life” means, as of the date of determination, with respect to any Indebtedness, 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 or redemption or similar payment with respect to such Indebtedness multiplied by the amount of such payment by (2) the sum
of all such payments. 
  
 “Beneficial Owner” has the
meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial ownership of any particular “person” (as that term is used in Sections 13(d) and 14(d) of the Exchange Act), such
“person” will be deemed to have beneficial ownership of all securities that such “person” has the right to acquire, whether such right is currently exercisable or is exercisable only after the passage of time. The terms
“Beneficially Owns” and “Beneficially Owned” have a corresponding meaning. 
  

 3 








 “Board of Directors” means the Board of Directors of the Company or any committee thereof duly
authorized to act on behalf of such Board. 
  
 “Business
Day” means each day which is not a Legal Holiday. 
  
 “Capital Lease Obligation” means an obligation that is required to be classified and accounted for as a capital lease for financial reporting purposes in accordance with GAAP, and the amount of Indebtedness represented by such
obligation shall be the capitalized amount of such obligation determined in accordance with GAAP; and the Stated Maturity thereof shall be the date of the last payment of rent or any other amount due under such lease prior to the first date upon
which such lease may be terminated by the lessee without payment of a penalty. For purposes of Section 4.10, a Capital Lease Obligation will be deemed to be secured by a Lien on the property being leased. 
  
 “Capital Stock” of any Person means any and all shares, interests
(including partnership interests), rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) equity of such Person, including any Preferred Stock, but excluding any debt securities convertible
into such equity. 
  
 “Change of Control” means the
occurrence of any of the following events: 
  
 (1) any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act), other than the Permitted Holder, is or becomes the Beneficial Owner, directly or indirectly, of more than 50% of the total voting power of
the Voting Stock of the Company; provided, however, that the Permitted Holder does not have the right or ability by voting power, contract or otherwise to elect or designate for election a majority of the Board of Directors (for the
purposes of this clause (1), such other person shall be deemed to Beneficially Own any Voting Stock of a specified person held by a parent entity, if such other person is the Beneficial Owner, directly or indirectly, of more than 50% of the voting
power of the Voting Stock of such parent entity and the Permitted Holder does not have the right or ability by voting power, contract or otherwise to elect or 

  

 4 








 
designate for election a majority of the board of directors of such parent entity); 
  
 (2) individuals who on the Issue Date constituted the Board of Directors (together with any new directors
whose election by such Board of Directors or whose nomination for election by the shareholders of the Company was approved by a majority of the directors of the Company then still in office who were either directors on the Issue Date or whose
election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors then in office; 
  
 (3) the adoption of a plan relating to the liquidation or dissolution of the Company; or 
  
 (4) the merger or consolidation of the Company with or into
another Person or the merger of another Person with or into the Company, or the sale of all or substantially all the assets of the Company (determined on a consolidated basis) to another Person, other than (A) a transaction in which the survivor or
transferee is a Person that is controlled by the Permitted Holder or (B) a transaction following which (i) in the case of a merger or consolidation transaction, holders of securities that represented 100% of the Voting Stock of the Company
immediately prior to such transaction (or other securities into which such securities are converted as part of such merger or consolidation transaction) own directly or indirectly at least a majority of the voting power of the Voting Stock of the
surviving Person in such merger or consolidation transaction immediately after such transaction and in substantially the same proportion as before the transaction and (ii) in the case of a sale of assets transaction, each transferee becomes an
obligor in respect of the Securities and a Subsidiary of the transferor of such assets. 
  
 “Code” means the Internal Revenue Code of 1986, as amended. 
  
 “Commercial Paper Facilities” means any facility pursuant to which the Company or a Restricted Subsidiary of the Company finances Receivables or
Servicing Receivables with the issuance of commercial paper secured by such 

  

 5 








 
Receivables or Servicing Receivables and maturing no more than one year from the date it is issued. 
  
 “Company” means the party named as such in this Indenture until a
successor replaces it and, thereafter, means the successor and, for purposes of any provision contained herein and required by the TIA, each other obligor on the indenture securities. 
  
 “Consolidated Interest Expense” means, for any period, the total interest expense of the Company and its
consolidated Restricted Subsidiaries for such period, excluding interest expense with respect to Warehouse Indebtedness and Non-Recourse Debt. 
  
 “Consolidated Leverage Ratio” as of any date of determination means the ratio of (x) the aggregate amount of Indebtedness of the Company and its
Restricted Subsidiaries as of such date of determination, excluding (A) Permitted Warehouse Indebtedness permitted to be Incurred pursuant to Section 4.03(b)(1), (B) Hedging Obligations permitted to be Incurred pursuant to Section 4.03(b)(7) and (C)
the Existing Disqualified Stock, to (y) EBITDA for the most recent four consecutive fiscal quarters ending at least 45 days prior to such date of determination (the “Reference Period”); provided, however, that: 
  
 (1) if the transaction giving rise to the need to calculate
the Consolidated Leverage Ratio is an Incurrence of Indebtedness, the amount of such Indebtedness shall be calculated after giving effect on a pro forma basis to such Indebtedness; 
  
 (2) if the Company or any Restricted Subsidiary has repaid,
repurchased, defeased or otherwise discharged any Indebtedness that was outstanding as of the end of such fiscal quarter or if any Indebtedness is to be repaid, repurchased, defeased or otherwise discharged on the date of the transaction giving rise
to the need to calculate the Consolidated Leverage Ratio (other than, in each case, Indebtedness Incurred under any revolving credit agreement), the aggregate amount of Indebtedness shall be calculated on a pro forma basis and EBITDA
shall be calculated as if the Company or such Restricted Subsidiary had not earned the interest income, if any, actually earned during the Reference Period in respect of cash or Temporary 

  

 6 








 
Cash Investments used to repay, repurchase, defease or otherwise discharge such Indebtedness; 
  
 (3) if since the beginning of the Reference Period the Company or any Restricted Subsidiary shall have made
any Asset Disposition, the EBITDA for the Reference Period shall be reduced by an amount equal to the EBITDA (if positive) directly attributable to the assets which are the subject of such Asset Disposition for the Reference Period or increased by
an amount equal to the EBITDA (if negative) directly attributable thereto for the Reference Period; 
  
 (4) if since the beginning of the Reference Period the Company or any Restricted Subsidiary (by merger or otherwise) shall have made an
Investment in any Restricted Subsidiary (or any Person which becomes a Restricted Subsidiary) or an acquisition of assets which constitutes all or substantially all of an operating unit of a business, EBITDA for the Reference Period shall be
calculated after giving pro forma effect thereto (including the Incurrence of any Indebtedness) as if such Investment or acquisition occurred on the first day of the Reference Period; and 
  
 (5) if since the beginning of the Reference Period any
Person (that subsequently became a Restricted Subsidiary or was merged with or into the Company or any Restricted Subsidiary since the beginning of such Reference Period) shall have made any Asset Disposition, any Investment or acquisition of assets
that would have required an adjustment pursuant to clause (3) or (4) above if made by the Company or a Restricted Subsidiary during the Reference Period, EBITDA for the Reference Period shall be calculated after giving pro forma effect
thereto as if such Asset Disposition, Investment or acquisition occurred on the first day of the Reference Period. 
  
 For purposes of this definition, whenever pro forma effect is to be given to an acquisition of assets, the amount of income or earnings
relating thereto and the amount of Consolidated Interest Expense associated with any Indebtedness Incurred in connection therewith, the pro forma calculations shall be determined in good faith by a responsible financial or accounting
Officer of the Company. If any Indebtedness bears a floating rate of interest and 

  

 7 








 
is being given pro forma effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the date of determination
had been the applicable rate for the entire period (taking into account any Interest Rate Agreement applicable to such Indebtedness if such Interest Rate Agreement has a remaining term in excess of 12 months). If any Indebtedness is Incurred under a
revolving credit facility and is being given pro forma effect, the interest on such Indebtedness shall be calculated based on the average daily balance of such Indebtedness for the four fiscal quarters subject to the pro
forma calculation to the extent such Indebtedness was incurred solely for working capital purposes. 
  
 “Consolidated Net Income” means, for any period, the net income of the Company and its consolidated Subsidiaries; provided,
however, that there shall not be included in such Consolidated Net Income: 
  
 (1) any net income of any Person (other than the Company) if such Person is not a Restricted Subsidiary, except that: 
  
 (A) subject to the exclusion contained in clause (4) below,
the Company’s equity in the net income of any such Person for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash actually distributed by such Person during such period to the Company or a Restricted
Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution paid to a Restricted Subsidiary, to the limitations contained in clause (3) below); and 
  
 (B) the Company’s equity in a net loss of any such
Person for such period shall be excluded in determining such Consolidated Net Income; 
  
 (2) any net income (or loss) of any Person acquired by the Company or a Subsidiary in a pooling of interests transaction (or any
transaction accounted for in a manner similar to a pooling of interests) for any period prior to the date of such acquisition; 
  
 (3) any net income of any Restricted Subsidiary if such Restricted Subsidiary is subject to restrictions, except as otherwise permitted by
clause 

  

 8 








 
(1) under Section 4.05, directly or indirectly, on the payment of dividends or the making of distributions by such Restricted Subsidiary, directly or
indirectly, to the Company, except that: 
  
 (A)
subject to the exclusion contained in clause (4) below, the Company’s equity in the net income of any such Restricted Subsidiary for such period shall be included in such Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Restricted Subsidiary during such period to the Company or another Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution paid to another Restricted Subsidiary, to the
limitation contained in this clause); and 
  
 (B)
the Company’s equity in a net loss of any such Restricted Subsidiary for such period shall be included in determining such Consolidated Net Income; 
  
 (4) any after-tax gain (or loss) realized upon the sale or other disposition of any assets of the Company, its consolidated Subsidiaries
or any other Person (including pursuant to any sale-and-leaseback arrangement) which are not sold or otherwise disposed of in the ordinary course of business and any gain (or loss) realized upon the sale or other disposition of any Capital Stock of
any Person; 
  
 (5) after-tax extraordinary gains
or losses; 
  
 (6) the cumulative effect of a
change in accounting principles; and 
  
 (7) any
non-cash, non-recurring charges of the Company and its consolidated Restricted Subsidiaries (excluding any such charge to the extent that it represents an accrual of or reserve for cash expenditures in any future period); 
  
 in each case, for such period. Notwithstanding the foregoing, there shall be excluded from
Consolidated Net Income the amount of any expense accrued (i) due to the creation of the Company’s December 2003 Bonus Plan, but in no event shall the amount so excluded exceed $27.0 million 

  

 9 








 
in the aggregate and (ii) due to the acceleration of amounts payable pursuant to the June 2003 Bonus Plan upon the occurrence of (a) the consummation of a
transaction in which any person or group (as defined in Section 13(d) of the Exchange Act) other than Chatham Street Holdings LLC becomes the beneficial owner of at least a majority of the common stock of the Company, whether by stock purchase,
merger, consolidation or otherwise, (b) a sale of all or substantially all of the assets of the Company or WMC Mortgage Corp. or (c) a Qualified IPO (as defined in the Certificate of Designation relating to the Company’s Series E Cumulative
Senior Preferred Stock, as in effect on the Issue Date), but in no event shall the amount so excluded exceed $9.5 million in the aggregate. Notwithstanding the foregoing, for the purposes of Section 4.04 only, there shall be excluded from
Consolidated Net Income any repurchases, repayments or redemptions of Investments, proceeds realized on the sale of Investments or return of capital to the Company or a Restricted Subsidiary to the extent such repurchases, repayments, redemptions,
proceeds or returns increase the amount of Restricted Payments permitted under such Section pursuant to Section 4.04(a)(3)(D). 
  
 “Currency Agreement” means, in respect of any Person, any foreign exchange contract, currency swap agreement or other similar agreement designed
to protect such Person against fluctuations in currency values. 
  
 “December 2003 Bonus Plan” means the December 2003 Bonus Plan of the Company, as adopted by the Board of Directors in December 2003. 
  
 “Default” means any event which is, or after notice or passage of time or both would be, an Event of Default. 
  
 “Disqualified Stock” means, with respect to any Person, any Capital
Stock which by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable at the option of the holder) or upon the happening of any event: 
  
 (1) matures or is mandatorily redeemable (other than redeemable only for Capital Stock of such Person which
is not itself Disqualified Stock) pursuant to a sinking fund obligation or otherwise; 
  

 10 








 (2) is convertible or exchangeable at the option of the holder for Indebtedness or
Disqualified Stock; or 
  
 (3) is mandatorily
redeemable or must be purchased upon the occurrence of certain events or otherwise, in whole or in part; 
  
 in each case on or prior to the first anniversary of the Stated Maturity of the Securities; provided, however, that any Capital Stock that would not constitute Disqualified Stock but for provisions
thereof giving holders thereof the right to require such Person to purchase or redeem such Capital Stock upon the occurrence of an “asset sale” or “change of control” occurring prior to the first anniversary of the Stated
Maturity of the Securities shall not constitute Disqualified Stock if (A) the “asset sale” or “change of control” provisions applicable to such Capital Stock are not more favorable to the holders of such Capital Stock than the
terms applicable to the Securities under Sections 4.06 and 4.09 and (B) any such requirement only becomes operative after compliance with such terms applicable to the Securities, including the purchase of any Securities tendered pursuant thereto.

  
 The amount of any Disqualified Stock that does not have a
fixed redemption, repayment or repurchase price will be calculated in accordance with the terms of such Disqualified Stock as if such Disqualified Stock were redeemed, repaid or repurchased on any date on which the amount of such Disqualified Stock
is to be determined pursuant to this Indenture; provided, however, that if such Disqualified Stock could not be required to be redeemed, repaid or repurchased at the time of such determination, the redemption, repayment or repurchase
price will be the book value of such Disqualified Stock as reflected in the most recent financial statements of such Person. 
  
 “EBITDA” for any period means the sum of Consolidated Net Income, plus the following to the extent deducted in calculating such Consolidated Net
Income (without duplication): 
  
 (1) all income
tax expense of the Company and its consolidated Restricted Subsidiaries; 
  
 (2) Consolidated Interest Expense; 
  

 11 








 (3) depreciation and amortization expense of the Company and its consolidated Restricted
Subsidiaries (excluding amortization expense attributable to a prepaid operating activity item that was paid in cash in a prior period); 
  
 (4) all other non-cash charges of the Company and its consolidated Restricted Subsidiaries (excluding any such non-cash charge to the
extent that it represents an accrual of or reserve for cash expenditures in any future period); 
  
 (5) any after-tax charges relating to or arising from an Initial Public Equity Offering; 
  
 (6) any premiums and fees paid in connection with the
repurchase, redemption, retirement or defeasance of any Indebtedness; and 
  
 (7) any after-tax cash charges relating to the conversion of the Existing Disqualified Stock pursuant to the terms thereof as in effect on the Issue Date; 
  
 in each case for such period. Notwithstanding the foregoing, the provision for taxes based on the income or profits of, and the depreciation
and amortization and non-cash charges of, a Restricted Subsidiary shall be added to Consolidated Net Income to compute EBITDA only to the extent (and in the same proportion, including by reason of minority interests) that the net income or loss of
such Restricted Subsidiary was included in calculating Consolidated Net Income and only if a corresponding amount would be permitted at the date of determination to be dividended to the Company by such Restricted Subsidiary without prior approval
(that has not been obtained), pursuant to the terms of its charter and all agreements, instruments, judgments, decrees, orders, statutes, rules and governmental regulations applicable to such Restricted Subsidiary or its stockholders. 
  
 “Eligible Excess Spread Receivables” means Excess Spread
Receivables of the Company or any Restricted Subsidiary acquired after the Issue Date; provided, however, that Eligible Excess Spread Receivables shall not include any Excess Spread Receivables created as the result of the
securitization or sale of other Excess Spread Receivables. 
  

 12 








 “Excess Spread” means, over the life of a “pool” of mortgage loans that have been
sold by a Person or Persons, and no less than 25% of the aggregate value of which “pool” is comprised of Receivables sold by the Company or a Restricted Subsidiary, to a trust or other Person in a securitization or sale, the rights
retained or held by the Company or its Restricted Subsidiaries at or subsequent to the closing of such securitization or sale to receive cash flows attributable to such “pool,” including cash flows in respect of the right to service assets
comprising such “pool.” 
  
 “Excess Spread
Receivables” of a Person means the contractual or certificated right to Excess Spread capitalized on such Person’s consolidated balance sheet (the amount of which shall be the present value of the Excess Spread, calculated in accordance
with GAAP). 
  
 “Exchange Act” means the U.S. Securities
Exchange Act of 1934, as amended. 
  
 “Excluded
Contribution” means Net Cash Proceeds received by the Company from (a) contributions to its equity capital and (b) the sale of Capital Stock of the Company (other than Disqualified Stock), in each case designated as Excluded Contributions
pursuant to an Officers’ Certificate executed on the date such capital contributions are made or the date such Capital Stock (other than Disqualified Stock) is sold, as the case may be, which are excluded from the calculation set forth in
Section 4.04(a)(3)(B). 
  
 “Existing Disqualified Stock”
means Disqualified Stock of the Company outstanding on the Issue Date. 
  
 “Fair Market Value” means the value that would be paid by a willing buyer to an unaffiliated willing seller in a transaction not involving distress or necessity of either party, determined in good faith by the Board of Directors
of the Company (unless otherwise provided in this Indenture) whose resolution with respect thereto will be delivered to the Trustee. 
  
 “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: 
  
 (1) the opinions and pronouncements
of the Accounting Principles Board of the American Institute of Certified Public Accountants; 
  

 13 








 (2) statements and pronouncements of the Financial Accounting Standards Board;

  
 (3) such other statements by such other
entity as approved by a significant segment of the accounting profession; and 
  
 (4) the rules and regulations of the SEC governing the inclusion of financial statements (including pro forma financial statements) in periodic reports required to be filed pursuant to Section 13 of the
Exchange Act, including opinions and pronouncements in staff accounting bulletins and similar written statements from the accounting staff of the SEC. 
  
 All ratios and computations based on GAAP contained in this Indenture shall be computed in conformity with GAAP. 
  
 “Guarantee” means any obligation, contingent or otherwise, of any
Person directly or indirectly guaranteeing any Indebtedness of any 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 Person (whether arising by
virtue of partnership arrangements, or by agreements 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 the purpose 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” shall not include endorsements for collection or deposit in the ordinary course of business. The term
“Guarantee” used as a verb has a corresponding meaning. The term “Guarantor” shall mean any Person Guaranteeing any obligation. 
  

 14 








 “Hedging Obligations” of any Person means the obligations of such Person pursuant to any
Interest Rate Agreement or Currency Agreement. 
  
 “Holder” or “Securityholder” means the Person in whose name a Security is registered on the Registrar’s books. 
  
 “Incur” means issue, assume, Guarantee, incur or otherwise become liable for; provided, however, that any Indebtedness of a Person
existing at the time such Person becomes a Restricted Subsidiary (whether by merger, consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Person at the time it becomes a Restricted Subsidiary. The term
“Incurrence” when used as a noun shall have a correlative meaning. 
  
 Solely for purposes of determining compliance with Section 4.03: 
  
 (1) amortization of debt discount or the accretion of principal with respect to a non-interest bearing or other discount security;

  
 (2) the payment of regularly scheduled
interest in the form of additional Indebtedness of the same instrument or the payment of regularly scheduled dividends on Capital Stock in the form of additional Capital Stock of the same class and with the same terms; and 
  
 (3) the obligation to pay a premium in respect of
Indebtedness arising in connection with the issuance of a notice of redemption or the making of a mandatory offer to purchase such Indebtedness; 
  
 shall not be deemed to be the Incurrence of Indebtedness. 
  
 “Indebtedness” means, with respect to any Person on any date of determination (without duplication): 
  
 (1) the principal in respect of (A) indebtedness of such
Person for money borrowed and (B) indebtedness evidenced by notes, debentures, bonds or other similar instruments for the payment of which such Person is responsible or liable, including, in each case, any premium on such indebtedness to the extent
such premium has become due and payable; 
  

 15 








 (2) all Capital Lease Obligations of such Person and all Attributable Debt in respect of
Sale/Leaseback Transactions entered into by such Person; 
  
 (3) all obligations of such Person issued or assumed as the deferred purchase price of property, all conditional sale obligations of such Person and all obligations of such Person under any title retention agreement
(but excluding trade accounts payable arising and expenses accrued in the ordinary course of business); 
  
 (4) all obligations of such Person for the reimbursement of any obligor on any letter of credit, bankers’ acceptance or similar
credit transaction (other than obligations with respect to letters of credit securing obligations (other than obligations described in clauses (1) through (3) above) entered into in the ordinary course of business of such Person to the extent such
letters of credit are not drawn upon or, if and to the extent drawn upon, such drawing is reimbursed no later than the tenth Business Day following payment on the letter of credit); 
  
 (5) the amount of all obligations of such Person with respect to the redemption, repayment or other
repurchase of any Disqualified Stock of such Person or Preferred Stock of any Subsidiary of such Person or that are determined by the value of such Capital Stock, the principal amount of such Capital Stock to be determined in accordance with this
Indenture; 
  
 (6) all Warehouse Indebtedness;

  
 (7) in connection with each sale by such
Person of any Excess Spread Receivables, the maximum aggregate contractual claim (if any) that the purchaser thereof could have against such Person if the amounts anticipated at the time of such sale to be received by such purchaser in connection
with such Excess Spread Receivables are not received by such purchaser; 
  
 (8) all obligations of the type referred to in clauses (1) through (7) of other Persons and all dividends of other Persons for the payment of which, in either case, such Person is responsible or liable, 

  

 16 








 
directly or indirectly, as obligor, guarantor or otherwise, including by means of any Guarantee; 
  
 (9) all obligations of the type referred to in clauses (1)
through (8) of other Persons secured by any Lien on any property or asset of such Person (whether or not such obligation is assumed by such Person), the amount of such obligation being deemed to be the lesser of the value of such property or assets
and the amount of the obligation so secured; and 
  
 (10) to the extent not otherwise included in this definition, Hedging Obligations of such Person. 
  
 Notwithstanding the foregoing, in connection with the purchase by the Company or any Restricted Subsidiary of any business, the term “Indebtedness” will exclude post-closing payment adjustments to which the
seller may become entitled to the extent such payment is determined by a final closing balance sheet or such payment depends on the performance of such business after the closing; provided, however, that, at the time of closing, the
amount of any such payment is not determinable and, to the extent such payment thereafter becomes fixed and determined, the amount is paid within 30 days thereafter. Notwithstanding the foregoing, the term “Indebtedness” will also exclude
any series of Preferred Stock (other than Disqualified Stock) issued by the Company. 
  
 Except in the case of Warehouse Indebtedness (the amount of which shall be determined in accordance with the definition thereof), the amount of Indebtedness of any Person at any date shall 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; provided, however, that in
the case of Indebtedness sold at a discount, the amount of such Indebtedness at any time will be the accreted value thereof at such time. Notwithstanding the foregoing, any securities issued in a securitization by a special purpose owner trust or
similar entity formed by or on behalf of a Person and to which Receivables or Excess Spread Receivables have been sold or otherwise transferred by or on behalf of such Person or its Subsidiaries shall not be treated as Indebtedness of such Person or
its Subsidiaries under this Indenture, regardless of whether such securities are treated as indebtedness for tax 

  

 17 








 
purposes, provided (1) neither the Company nor any of its Restricted Subsidiaries (other than a Special Purpose Subsidiary) (a) provides credit
support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), or (b) is directly or indirectly liable thereon (as a guarantor or otherwise), and (2) no default with respect to which (including any
rights that the holders thereof may have to take enforcement action against such Special Purpose Subsidiary) would permit (upon notice, lapse of time or both) any holder of any other Indebtedness of the Company or any of its Restricted Subsidiaries
to declare a default on such other Indebtedness or cause the payment thereof to be accelerated or payable prior to its stated maturity. 
  
 “Indenture” means this Indenture as amended or supplemented from time to time. 
  
 “Independent Qualified Party” means an investment banking firm,
accounting firm or appraisal firm of national standing; provided, however, that such firm is not an Affiliate of the Company. 
  
 “Initial Public Equity Offering” means the initial underwritten public offering of common stock of the Company pursuant to an effective
registration statement under the Securities Act, including primary and secondary offerings and any combination thereof. 
  
 “Initial Purchasers” means Credit Suisse First Boston LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Lehman Brothers Inc.

  
 “Interest Rate Agreement” means, in respect of a
Person, any interest rate swap agreement, interest rate cap agreement or other financial agreement or arrangement designed to protect such Person against fluctuations in interest rates. 
  
 “Investment” in any Person means any direct or indirect advance, loan (other than advances to customers in the
ordinary course of business that are recorded as accounts receivable on the balance sheet of the lender) or other extensions of credit (including by way of Guarantee or similar arrangement) 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 

  

 18 








 
Stock, Indebtedness or other similar instruments issued by such Person. If the Company or any Restricted Subsidiary issues, sells or otherwise disposes of
any Capital Stock of a Person that is a Restricted Subsidiary such that, after giving effect thereto, such Person is no longer a Restricted Subsidiary, any Investment by the Company or any Restricted Subsidiary in such Person remaining after giving
effect thereto will be deemed to be a new Investment at such time. The acquisition by the Company or any Restricted Subsidiary of a Person that becomes a Restricted Subsidiary and holds an Investment in a third Person will be deemed to be an
Investment by the Company or such Restricted Subsidiary in such third Person at such time. Except as otherwise provided for herein, the amount of an Investment shall be its fair market value at the time the Investment is made and without giving
effect to subsequent changes in value. 
  
 For purposes of the
definition of “Unrestricted Subsidiary”, the definition of “Restricted Payment” and Section 4.04: 
  
 (1) in the case of the designation of a Subsidiary as an Unrestricted Subsidiary, “Investment” shall include the portion
(proportionate to the Company’s equity interest in such Subsidiary) of the fair market value of the net assets of such Subsidiary at the time that such Subsidiary is designated an Unrestricted Subsidiary; provided, however, that
upon a redesignation of such Subsidiary as a Restricted Subsidiary, the value of such Investment shall be reduced (but not below zero) by the portion (proportionate to the Company’s equity interest in such Subsidiary) of the fair market value
of the net assets of such Subsidiary at the time of such redesignation; and 
  
 (2) any property transferred to or from an Unrestricted Subsidiary shall 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. 

 
 “Issue Date” means December 16, 2003. 
  
 “June 2003 Bonus Plan” means the June 2003 Bonus Plan of WMC
Mortgage Corp., as adopted by the Board of Directors of WMC Mortgage Corp. on June 26, 2003. 
  

 19 








 “Legal Holiday” means a Saturday, a Sunday or a day on which banking institutions are not
required to be open in the State of New York. 
  
 “Lien”
means, with respect to any Person, (i) any mortgage, pledge, security interest, encumbrance, lien or charge of any kind on the assets of such Person (including any conditional sale or other title retention agreement or lease in the nature thereof),
and (ii) any claim (whether direct or indirect through subordination or other structural encumbrance) against any Excess Spread Receivables sold or otherwise transferred by such Person to a buyer, unless such Person is not liable for any losses
thereon. 
  
 “Moody’s” means Moody’s Investors
Service, Inc. and any successor to its rating agency business. 
  
 “Net Available Cash” from an Asset Disposition means cash payments received therefrom (including any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable or otherwise and
proceeds from the sale or other disposition of any securities 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 such properties or assets or received in any other non-cash form), in each case net of (without duplication): 
  
 (1) all legal, title and recording tax expenses, commissions and other fees and expenses incurred, and all Federal, state, provincial,
foreign and local taxes required to be accrued as a liability under GAAP, as a consequence of such Asset Disposition; 
  
 (2) all payments made on any Indebtedness which is secured by any assets subject to such Asset Disposition, in accordance with the terms
of any Lien upon or other security agreement of any kind with respect to such assets, or which must by its terms, or in order to obtain a necessary consent to such Asset Disposition, or by applicable law, be repaid out of the proceeds from such
Asset Disposition; 
  
 (3) all distributions and
other payments required to be made to minority interest holders in 

  

 20 








 
Restricted Subsidiaries as a result of such Asset Disposition; 
  
 (4) the deduction of appropriate amounts provided by the seller as a reserve, in accordance with GAAP, against any liabilities associated
with the property or other assets disposed in such Asset Disposition and retained by the Company or any Restricted Subsidiary after such Asset Disposition; and 
  

(5) any portion of the purchase price from an Asset Disposition placed in escrow, whether as a reserve for adjustment of the purchase
price, for satisfaction of indemnities in respect of such Asset Disposition or otherwise in connection with that Asset Disposition; provided, however, that upon the termination of that escrow, Net Available Cash will be increased by
any portion of funds in the escrow that are released to the Company or any Restricted Subsidiary. 
  
 “Net Cash Proceeds,” with respect to any issuance or sale of Capital Stock or Indebtedness, means the cash proceeds of such issuance or sale net
of attorneys’ fees, accountants’ fees, underwriters’ or placement agents’ fees, discounts or commissions and brokerage, consultant and other fees actually incurred in connection with such issuance or sale and net of taxes paid or
payable as a result thereof. 
  
 “Net Fair Market
Value,” with respect to any non-cash property received by the Company in respect of the issuance or sale of its Capital Stock, means the value of such property that would be paid by a willing buyer to an unaffiliated willing seller in a
transaction not involving distress or necessity of either party, determined in good faith by the Board of Directors (unless otherwise provided in this Indenture) whose resolution with respect thereto will be delivered to the Trustee, net of
attorneys’ fees, accountants’ fees, underwriters’ or placement agents’ fees, discounts or commissions and brokerage, consultant and other fees actually incurred in connection with such issuance or sale and net of taxes paid or
payable as a result thereof. 
  
 “Non-Recourse Debt”
means Indebtedness (i) as to which neither the Company nor any of its Restricted 

  

 21 








 
Subsidiaries (a) provides a Guarantee or other credit enhancement of any kind (including any undertaking, agreement or instrument that would constitute
Indebtedness), or (b) is directly or indirectly liable thereon (as the primary obligor or otherwise), (ii) 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 Company or any of its Restricted Subsidiaries (other than the Securities or, for purposes of the definition of “Unrestricted
Subsidiary” only, any Indebtedness outstanding on the Issue Date) to declare a default on such other Indebtedness or cause the payment thereof to be accelerated or payable prior to its stated maturity and (iii) as to which the lenders have been
notified in writing that they will not have any recourse to the stock or assets of the Company or any of its Restricted Subsidiaries. 
  
 “Obligations” means, with respect to any Indebtedness, all obligations for principal, premium, interest, penalties, fees, indemnifications,
reimbursements and other amounts payable pursuant to the documentation governing such Indebtedness. 
  
 “Offering Circular” means the Offering Circular dated December 11, 2003 pursuant to which the Initial Securities issued on the Issue Date were
offered. 
  
 “Officer” means the Chairman of the Board,
the President, any Vice President, the Treasurer or the Secretary of the Company. 
  
 “Officers’ Certificate” means a certificate signed by two Officers. 
  
 “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 Company or the Trustee. 
  
 “Permitted Holder”
means Apollo Management, L.P. and any of its Affiliates. 
  

 22 








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

  
 (1) the Company, a Restricted Subsidiary or a
Person that will, upon the making of such Investment, become a Restricted Subsidiary; provided, however, that the primary business of such Restricted Subsidiary is a Related Business; 
  
 (2) another Person if, as a result of such Investment, such
other Person is merged or consolidated with or into, or transfers or conveys all or substantially all its assets to, the Company or a Restricted Subsidiary; provided, however, that such Person’s primary business is a Related
Business; 
  
 (3) cash and Temporary Cash
Investments; 
  
 (4) receivables owing to the
Company or any Restricted Subsidiary if 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 the Company or any such Restricted Subsidiary deems reasonable under the circumstances; 
  
 (5) payroll, travel 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 made in the ordinary course of business consistent with past practices of the Company or such
Restricted Subsidiary; 
  
 (7) stock, obligations
or securities received in settlement of debts created in the ordinary course of business and owing to the Company or any Restricted Subsidiary or in satisfaction of judgments; 
  
 (8) any Person to the extent such Investment represents the non-cash portion of the consideration received
for (A) an Asset Disposition as permitted pursuant to Section 4.06 or (B) a disposition of assets not constituting an Asset Disposition; 
  
 (9) Receivables and Servicing Receivables; 
  

 23 








 (10) Excess Spread Receivables; 
  
 (11) any Person where such Investment was acquired by the
Company or any of its Restricted Subsidiaries (A) in exchange for any other Investment or accounts receivable held by the Company 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 Company 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; 
  
 (12) any
Person to the extent such Investments consist of prepaid expenses, negotiable instruments held for collection and lease, utility and workers’ compensation, performance and other similar deposits made in the ordinary course of business by the
Company or any Restricted Subsidiary; 
  
 (13)
any Person to the extent such Investments consist of Hedging Obligations otherwise permitted under Section 4.03; 
  
 (14) any Person to the extent such Investments are existing on the Issue Date, and any extension, modification or renewal of any such
Investments existing on the Issue Date, but only to the extent not involving additional advances, contributions or other Investments of cash or other assets or other increases thereof (other than as a result of the accrual or accretion of interest
or original issue discount or the issuance of pay-in-kind securities, in each case, pursuant to the terms of such Investment as in effect on the Issue Date); and 
  
 (15) Persons to the extent such Investments, when taken together with all other Investments made pursuant to
this clause (15) outstanding on the date such Investment is made, do not exceed $20.0 million; provided that if an Investment pursuant to this clause (15) is made in any Person that is not a Restricted Subsidiary of the Company at the date of
the making of the Investment, and such Person becomes a Restricted Subsidiary after such date, such Investment shall thereafter be deemed to have been 

  

 24 








 
made pursuant to clause (1) above and shall cease to have been made pursuant to this clause (15). 
  
 “Permitted Liens” means, with respect to any Person: 
  
 (1) 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 duties or for the payment of
rent, in each case Incurred in the ordinary course of business; 
  
 (2) Liens imposed by law, such as carriers’, warehousemen’s and mechanics’ Liens, in each case for sums not yet due or being contested in good faith by appropriate proceedings or other Liens arising out
of judgments or awards against such Person with respect to which such Person shall then be proceeding with an appeal or other proceedings for review and Liens arising solely by virtue of any statutory or common law provision relating to
banker’s Liens, rights of set-off or similar rights and remedies as to deposit accounts or other funds maintained with a creditor depository institution; provided, however, that (A) such deposit account is not a dedicated cash
collateral account and is not subject to restrictions against access by the Company in excess of those set forth by regulations promulgated by the Federal Reserve Board and (B) such deposit account is not intended by the Company or any Restricted
Subsidiary to provide collateral to the depository institution; 
  
 (3) Liens for property taxes not yet subject to penalties for non-payment or which are being contested in good faith by appropriate proceedings; 
  
 (4) Liens in favor of issuers of surety bonds or letters of credit 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; 
  

 25 








 (5) minor survey exceptions, minor encumbrances, 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 or other restrictions as to the use of real property or Liens incidental to the conduct of the business of such
Person or to the ownership of its properties which were not Incurred in connection with Indebtedness and which 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; 
  
 (6) Liens securing
Indebtedness Incurred to finance the construction, purchase or lease of, or repairs, improvements or additions to, property, plant or equipment of such Person; provided, however, that the Lien may not extend to any other property owned
by such Person or any of its Restricted Subsidiaries at the time the Lien is Incurred (other than assets and property affixed or appurtenant thereto), and the Indebtedness (other than any interest thereon) secured by the Lien may not be Incurred
more than 180 days after the later of the acquisition, completion of construction, repair, improvement, addition or commencement of full operation of the property subject to the Lien; 
  
 (7) Liens on Receivables and Servicing Receivables and the proceeds thereof, including REO Assets (but
excluding any Excess Spread Receivables) to secure Indebtedness permitted under the provisions described in Section 4.03(b)(1); 
  
 (8) Liens on Excess Spread Receivables (or on the Capital Stock of any Subsidiary of such Person substantially all the assets of which are
Excess Spread Receivables); provided, however, that (x) any such Liens may only encumber Eligible Excess Spread Receivables, (y) the Indebtedness secured by such Lien shall not exceed the value of the Eligible Excess Spread Receivables
subject to such Lien at the time such Lien is Incurred and (z) the Indebtedness secured by such Lien shall not be secured by any property of the Company or any Restricted Subsidiary other than such Eligible Excess Spread Receivables; 
  
 (9) Liens existing on the Issue Date; 
  

 26 








 (10) Liens on property or shares of Capital Stock of another Person at the time such
other Person becomes a Subsidiary of such Person; provided, however, that the Liens may not extend to any other property owned by such Person or any of its Restricted Subsidiaries (other than assets and property affixed or appurtenant
thereto); 
  
 (11) Liens on property at the time
such Person or any of its Subsidiaries acquires the property, including any acquisition by means of a merger or consolidation with or into such Person or a Subsidiary of such Person; provided, however, that the Liens may not extend to
any other property owned by such Person or any of its Restricted Subsidiaries (other than assets and property affixed or appurtenant thereto); 
  
 (12) Liens securing Indebtedness or other obligations of a Subsidiary of such Person owing to such Person or a Wholly Owned Subsidiary of
such Person; 
  
 (13) (a) Liens (other than on
Excess Spread Receivables) securing Hedging Obligations so long as such Hedging Obligations relate to Indebtedness that is, and is permitted to be under this Indenture, secured by a Lien on the same property securing such Hedging Obligations and (b)
Liens on retained rights of a Person or its Subsidiaries to service Receivables that have been securitized or sold and on cash flows attributable to such retained rights securing Hedging Obligations entered into to protect such Person against
fluctuations in the value of such retained rights; and 
  
 (14) Liens to secure any Refinancing (or successive Refinancings) as a whole, or in part, of any Indebtedness secured by any Lien referred to in the foregoing clause (6), (9), (10) or (11); provided, however, that (A) such new
Lien shall be limited to all or part of the same property and assets that secured or, under the written agreements pursuant to which the original Lien arose, could secure the original Lien (plus improvements and accessions to such property or
proceeds or distributions thereof) and (B) the Indebtedness secured by such Lien at such time is not increased to any amount greater than the sum of (i) the outstanding principal amount or, if 

  

 27 








 
greater, committed amount of the Indebtedness described under clause (6), (9), (10) or (11) at the time the original Lien became a Permitted Lien and (ii) an
amount necessary to pay any fees and expenses, including premiums, related to such refinancing, refunding, extension, renewal or replacement. 
  
 Notwithstanding the foregoing, “Permitted Liens” will not include any Lien described in clause (6), (10) or (11) above to the extent such Lien applies to any
Additional Assets acquired directly or indirectly from Net Available Cash pursuant to Section 4.06. For purposes of this definition, the term “Indebtedness” shall be deemed to include interest on such Indebtedness. 
  
 “Permitted Warehouse Indebtedness” means Warehouse Indebtedness;
provided, however, that (i) the assets as to which such Warehouse Indebtedness relates are or, prior to any funding under the related Warehouse Facility with respect to such assets, were eligible to be recorded as held for sale on the
consolidated balance sheet of the Company in accordance with GAAP and, (ii) the excess, if any, of (x) the amount of any such Warehouse Indebtedness for which the holder thereof has contractual recourse to the Company or its Restricted Subsidiaries
to satisfy claims with respect to such Warehouse Indebtedness over (y) the aggregate (without duplication of amounts) realizable value of the assets which secure such Warehouse Indebtedness, shall not be Permitted Warehouse Indebtedness. For
purposes of this definition, “realizable value” of an asset means (i) with respect to any REO Asset, the value realizable upon the disposition of such asset as determined by the Company in its reasonable discretion and consistent with
customary industry practice and (ii) with respect to any other asset, the lesser of (x) the face value of such asset and (y) the market value of such asset as determined in accordance with the agreement governing the applicable Warehouse
Indebtedness; provided, however, that the realizable value of any asset described in clause (i) or (ii) above for which an unaffiliated third party has a binding contractual commitment to purchase from the Company or a Restricted
Subsidiary shall be the minimum price payable to the Company or such Restricted Subsidiary for such asset pursuant to such contractual commitment. 
  
 “Person” means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust,
unincorporated 

  

 28 








 
organization, government or any agency or political subdivision thereof or any other entity. 
  
 “Preferred Stock”, as applied to the Capital Stock of any Person, means Capital Stock of any class or classes
(however designated) which is preferred as to the payment of dividends or distributions, or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over shares of Capital Stock of any other class
of such Person. 
  
 “principal” of a Security means the
principal of the Security plus the premium, if any, payable on the Security which is due or overdue or is to become due at the relevant time. 
  
 “Purchase Facility” means any Warehouse Facility in the form of a purchase and sale facility pursuant to which the Company or a Restricted
Subsidiary of the Company sells Receivables to a financial institution and retains a right of first refusal upon the subsequent resale of such Receivables by such financial institution. 
  
 “Rating Agency” means Standard & Poor’s or Moody’s. 
  
 “Receivables” means mortgage loans purchased or originated by the
Company or any Restricted Subsidiary in the ordinary course of business; provided, however, that for purposes of determining the amount of a Receivable at any time, such amount shall be determined in accordance with GAAP, consistently
applied, as of the most recent practicable date. 
  
 “Refinance” means, in respect of any Indebtedness, to refinance, extend, renew, refund, repay, prepay, purchase, redeem, defease or retire, or to issue other Indebtedness in exchange or replacement for, such Indebtedness.
“Refinanced” and “Refinancing” shall have correlative meanings. 
  
 “Refinancing Indebtedness” means Indebtedness that Refinances any Indebtedness of the Company or any Restricted Subsidiary existing on the Issue Date or Incurred in compliance with this Indenture, including
Indebtedness that Refinances Refinancing Indebtedness; provided, however, that: 
  
 (1) such Refinancing Indebtedness has a Stated Maturity no earlier than the Stated Maturity of the Indebtedness being Refinanced;

  

 29 








 (2) such 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 has an aggregate principal amount (or if Incurred with original issue discount, an aggregate issue
price) that is equal to or less than the aggregate principal amount (or if Incurred with original issue discount, the aggregate accreted value) then outstanding or committed (plus fees and expenses, including any premium and defeasance costs) under
the Indebtedness being Refinanced; and 
  
 (4) if
the Indebtedness being Refinanced is subordinated in right of payment to the Securities, such Refinancing Indebtedness is subordinated in right of payment to the Securities at least to the same extent as the Indebtedness being Refinanced;

  
 provided further, however, that Refinancing Indebtedness
shall not include (A) Indebtedness of a Subsidiary that Refinances Indebtedness of the Company or (B) Indebtedness of the Company or a Restricted Subsidiary that Refinances Indebtedness of an Unrestricted Subsidiary. 
  
 “Related Business” means any business in which the Company or any
of the Restricted Subsidiaries was engaged on the Issue Date and any business related, ancillary or complementary to such business. 
  
 “REO Asset” of a Person means a real estate asset owned by such Person and acquired as a result of the foreclosure or other enforcement of a
Lien on such asset securing a Receivable or Servicing Receivable. 
  
 “Restricted Payment” with respect to any Person means: 
  
 (1) the declaration or payment of any dividends or any other distributions of any sort in respect of its Capital Stock (including any payment in connection with any merger or consolidation involving such 

  

 30 








 
Person) or similar payment to the direct or indirect holders of its Capital Stock (other than (A) dividends or distributions payable solely in its Capital
Stock (other than Disqualified Stock), (B) dividends or distributions payable solely to the Company or a Restricted Subsidiary and (C) pro rata dividends or other distributions made by a Subsidiary that is not a Wholly Owned Subsidiary
to minority stockholders (or owners of an equivalent interest in the case of a Subsidiary that is an entity other than a corporation)); 
  
 (2) the purchase, redemption or other acquisition or retirement for value of any Capital Stock of the Company held by any Person (other
than by a Restricted Subsidiary) or of any Capital Stock of a Restricted Subsidiary held by any Affiliate of the Company (other than by a Restricted Subsidiary), including in connection with any merger or consolidation and including the exercise of
any option to exchange any Capital Stock (other than into Capital Stock of the Company that is not Disqualified Stock); 
  
 (3) the purchase, repurchase, redemption, defeasance or other acquisition or retirement for value, prior to scheduled maturity, scheduled
repayment or scheduled sinking fund payment of any Subordinated Obligations of the Company (other than (A) from the Company or a Restricted Subsidiary or (B) the purchase, repurchase, redemption, defeasance or other acquisition of 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 such purchase, repurchase, redemption, defeasance or other acquisition); or

  
 (4) the making of any Investment (other than
a Permitted Investment) in any Person. 
  
 “Restricted
Subsidiary” means any Subsidiary of the Company that is not an Unrestricted Subsidiary. 
  
 “Sale/Leaseback Transaction” means an arrangement relating to property owned by the Company or a Restricted Subsidiary on the Issue Date or thereafter acquired by the Company or a Restricted Subsidiary
whereby the Company or a Restricted Subsidiary transfers such property to a Person 

  

 31 








 
and the Company or a Restricted Subsidiary leases it from such Person. 
  
 “SEC” means the U.S. Securities and Exchange Commission. 
  
 “Securities” means the Securities issued under this Indenture.

  
 “Securities Act” means the U.S. Securities Act of
1933, as amended. 
  
 “Senior Indebtedness” means with
respect to any Person: 
  
 (1) Indebtedness of
such Person, whether outstanding on the Issue Date or thereafter Incurred; and 
  
 (2) all other Obligations of such Person (including interest accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to such Person whether or not post-filing interest is allowed in such proceeding) in respect of Indebtedness described in clause (1) above, 
  
 unless, in the case of clauses (1) and (2), in the instrument creating or evidencing the same or pursuant to which the same is outstanding,
it is provided that such Indebtedness or other Obligations are subordinate in right of payment to the Securities; provided, however, that Senior Indebtedness shall not include: 
  
 (1) any obligation of such Person to the Company or any
Subsidiary; 
  
 (2) any liability for Federal,
state, local or other taxes owed or owing by such Person; 
  
 (3) any accounts payable or other liability to trade creditors arising in the ordinary course of business (including guarantees thereof or instruments evidencing such liabilities); 
  
 (4) any Indebtedness or other Obligation of such Person
which is subordinate or junior in any respect to any other Indebtedness or other Obligation of such Person; or 
  

 32 








 (5) that portion of any Indebtedness which at the time of Incurrence is Incurred in
violation of this Indenture. 
  
 “Servicing Receivables”
means obligations in respect of Receivables in respect of which the Company or a Restricted Subsidiary of the Company has made advances in its capacity as servicer of such Receivables in the ordinary course of business and on customary industry
terms. 
  
 “Significant Subsidiary” means any Restricted
Subsidiary that would be a “Significant Subsidiary” of the Company within the meaning of Rule 1-02 under Regulation S-X promulgated by the SEC. 
  
 “Special Purpose Subsidiary” means a Restricted Subsidiary formed in connection with a securitization or sale of Receivables (i) all the Capital
Stock of which (other than directors’ qualifying shares and shares held by other Persons to the extent such shares are required by applicable law to be held by a Person other than the Company or a Restricted Subsidiary) is owned by the Company
or one or more Restricted Subsidiaries, (ii) that has no assets other than Excess Spread Receivables created in such securitization or sale of Receivables, (iii) that conducts no business other than holding such Excess Spread Receivables and (iv)
that has no Indebtedness other than (a) Non-Recourse Debt or (b) Indebtedness arising as a result of such securitization or sale that would constitute Non-Recourse Debt but for the fact that such Special Purpose Subsidiary is directly or indirectly
liable thereon or the assets of such Special Purpose Subsidiary are subject thereto. 
  
 “Standard & Poor’s” means Standard & Poor’s, a division of The McGraw-Hill Companies, Inc., and any successor to its rating agency business. 
  
 “Stated Maturity” means, with respect to any security, the date
specified in such security 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 excluding any provision providing for the repurchase of such
security at the option of the holder thereof upon the happening of any contingency unless such contingency has occurred). 
  

 33 








 “Subordinated Obligation” means any Indebtedness of the Company (whether outstanding on the
Issue Date or thereafter Incurred) which is subordinate or junior in right of payment to the Securities pursuant to a written agreement to that effect. 
  
 “Subsidiary” means, with respect to any Person, any corporation, association, partnership or other business entity of which more than 50% of the
total voting power of shares of Voting Stock is at the time owned or controlled, directly or indirectly, by (1) such Person; (2) such Person and one or more Subsidiaries of such Person; or (3) one or more Subsidiaries of such Person. 
  
 “Tax Sharing Agreement” means any tax allocation agreement between
the Company or any of its Subsidiaries with any direct or indirect shareholder of the Company with respect to consolidated or combined tax returns including the Company or any of its Subsidiaries but only to the extent that amounts payable from time
to time by the Company or any such Subsidiary under any such agreement do not exceed the corresponding tax payments that the Company or such Subsidiary would have been required to make to any relevant taxing authority had the Company or such
Subsidiary not joined in such consolidated or combined returns, but instead had filed returns including only the Company or its Subsidiaries (provided that any such agreement may provide that, if the Company or any such Subsidiary ceases to
be a member of the affiliated group of corporations of which the Company is the common parent for purposes of filing a consolidated Federal income tax return (such cessation, a “Deconsolidation Event”), then the Company or such Subsidiary
shall indemnify such direct or indirect shareholder with respect to any Federal, state or local income, franchise or other tax liability (including any related interest, additions or penalties) imposed on such shareholder as the result of an audit
or other adjustment with respect to any period prior to such Deconsolidation Event that is attributable to the Company, such Subsidiary or any predecessor business thereof (computed as if the Company, such Subsidiary or such predecessor business, as
the case may be, were a stand-alone entity that filed separate tax returns as an independent corporation), but only to the extent that any such tax liability exceeds any liability for taxes recorded on the books of the Company or such Subsidiary
with respect to any such period). 
  

 34 








 “Temporary Cash Investments” means any of the following: 
  
 (1) any investment in direct obligations of the United
States of America or any agency thereof or obligations guaranteed by the United States of America or any agency thereof; 
  
 (2) investments in demand and time deposit accounts, certificates of deposit and money market deposits maturing within 180 days of the
date of acquisition thereof issued by a bank or trust company which is organized under the laws of the United States of America, any State thereof or any foreign country recognized by the United States of America, and which bank or trust company has
capital, surplus and undivided profits aggregating in excess of $50.0 million (or the foreign currency equivalent thereof) and has outstanding debt which is rated “A” (or such similar equivalent rating) or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under the Securities Act) or any money-market fund sponsored by a registered broker dealer or mutual fund distributor; 
  
 (3) repurchase obligations with a term of not more than 30 days for underlying securities of the types
described in clause (1) above entered into with a bank meeting the qualifications described in clause (2) above; 
  
 (4) investments in commercial paper, maturing not more than 90 days after the date of acquisition, issued by a corporation (other than an
Affiliate of the Company) organized and in existence under the laws of the United States of America or any foreign country recognized by the United States of America with a rating at the time as of which any investment therein is made of
“P-1” (or higher) according to Moody’s or “A-1” (or higher) according to Standard & Poor’s; 
  
 (5) investments in securities with maturities of six months or less from the date of acquisition issued or fully guaranteed by any state,
commonwealth or territory of the United States of America, or by any political subdivision or taxing authority thereof, and rated at least “A” by Standard & Poor’s or “A” by Moody’s; and 
  

 35 








 (6) investments in money market funds that invest substantially all their assets in
securities of the types described in clauses (1) through (5) above. 
  
 “TIA” means the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on the Issue Date. 
  
 “Trust Officer” means any officer of the Trustee within the Conventional Debt unit of the Institutional Trust Services department (or any
successor unit or department) of the Trustee located at the corporate trust office of the Trustee at the address designated in or pursuant to Section 10.02 hereof who has direct responsibility for the administration of this Indenture and, for
purposes of Sections 7.01(c)(2) and 7.05 hereof, also means, with respect to a particular corporate trust matter, any other officer of the Trustee to whom such matter is referred because of such person’s knowledge of and familiarity with the
particular subject. 
  
 “Trustee” means the party named
as such in this Indenture until a successor replaces it and, thereafter, means the successor. 
  
 “Uniform Commercial Code” means the New York Uniform Commercial Code as in effect from time to time. 
  
 “Unrestricted Subsidiary” means: 
  
 (1) any Subsidiary of the Company that at the time of determination shall be designated an Unrestricted Subsidiary by the Board of
Directors in the manner provided below; and 
  
 (2) any Subsidiary of an Unrestricted Subsidiary. 
  
 The Board of
Directors may designate any Subsidiary of the Company (including any newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary unless (a) such Subsidiary or any of its Subsidiaries owns any Capital Stock or Indebtedness of, or
holds any Lien on any property of, the Company or any other Subsidiary of the Company that is not a Subsidiary of the Subsidiary to be so designated or (b) such Subsidiary has outstanding any Indebtedness other than Non-Recourse Debt;
provided, however, that either (A) the Subsidiary to be so designated has total assets of $1,000 or less or (B) if such 

  

 36 








 
Subsidiary has assets greater than $1,000, such designation would be permitted under Section 4.04. 
  
 The Board of Directors may designate any Unrestricted Subsidiary to be a Restricted
Subsidiary; provided, however, that immediately after giving effect to such designation (A) the Company could Incur $1.00 of additional Indebtedness under Section 4.03(a) and (B) no Default shall have occurred and be continuing. Any
such designation by the Board of Directors shall be evidenced to the Trustee by promptly filing with the Trustee a copy of the resolution of the Board of Directors giving effect to such designation and an Officers’ Certificate certifying that
such designation complied with the foregoing provisions. 
  
 “U.S. Government Obligations” means direct obligations (or certificates representing an ownership interest in such obligations) of the United States of America (including any agency or instrumentality thereof) for the payment of
which the full faith and credit of the United States of America is pledged and which are not callable at the issuer’s option. 
  
 “Voting Stock” of a Person means all classes of Capital Stock of such Person then outstanding and normally entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or trustees thereof. 
  
 “Warehouse Facility” means any financing arrangement of any kind with a financial institution or other lender or purchaser exclusively to
finance (i) the purchase, origination or pooling of Receivables by the Company or a Subsidiary of the Company prior to securitization or sale, (ii) advances made by the Company or a Subsidiary of the Company on customary industry terms in its
capacity as servicer in respect of Receivables, (iii) the carrying of REO Assets related to Receivables, in each case in the ordinary course of business, including Purchase Facilities and Commercial Paper Facilities. 
  
 “Warehouse Indebtedness” means Indebtedness in connection with a
Warehouse Facility; the amount of any particular Warehouse Indebtedness as of any date of determination shall be the greater of (x) the consideration received by the Company or its Restricted Subsidiaries under such Warehouse Facility and not
previously repaid to the holder of such Warehouse Indebtedness and (y) in the 

  

 37 








 
case of a Purchase Facility, the book value of the Receivables financed under such Warehouse Facility until such time as such Receivables are (i)
securitized, (ii) repurchased by the Company or its Restricted Subsidiaries or (iii) sold to a Person who is not an Affiliate of the Company. 
  
 “Wholly Owned Subsidiary” means a Restricted Subsidiary all the Capital Stock of which (other than directors’ qualifying shares) is owned
by the Company or one or more Wholly Owned Subsidiaries. 
  

 38 








 SECTION 1.02 Other Definitions. 
  

			
	 Term

	  	Defined in
Section


	 “Affiliate Transaction”
	  	4.07(a)
	 “Bankruptcy Law”
	  	6.01
	 “Change of Control Offer”
	  	4.09(b)
	 “covenant defeasance option”
	  	8.01(b)
	 “Custodian”
	  	6.01
	 “Event of Default”
	  	6.01
	 “Exchange Offer Registration Statement”
	  	Appendix
	 “Exchange Securities”
	  	Appendix
	 “Initial Lien”
	  	4.10
	 “Initial Securities”
	  	Appendix
	 “legal defeasance option”
	  	8.01(b)
	 “Offer”
	  	4.06(b)
	 “Offer Amount”
	  	4.06(c)(2)
	 “Offer Period”
	  	4.06(c)(2)
	 “Paying Agent”
	  	2.03
	 “Private Exchange Securities”
	  	Appendix
	 “Purchase Date”
	  	4.06(c)(1)
	 “Registrar”
	  	2.03
	 “Shelf Registration Statement”
	  	Appendix
	 “Successor Company”
	  	5.01(a)(1)

  
 SECTION 1.03
Incorporation by Reference of Trust Indenture Act. This Indenture is subject to the mandatory provisions of the TIA which are incorporated by reference in and made a part of this Indenture. The following TIA terms have the following meanings:

  
 “Commission” means the SEC; 
  
 “indenture securities” means the Securities; 
  
 “indenture security holder” means a Securityholder; 
  
 “indenture to be qualified” means this Indenture; 
  
 “indenture trustee” or “institutional trustee” means the
Trustee; and 
  
 “obligor” on the indenture securities
means the Company and any other obligor on the indenture securities. 
  
 All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA reference to another 

  

 39 








 
statute or defined by SEC rule have the meanings assigned to them by such definitions. 
  
 SECTION 1.04 Rules of Construction. Unless the context otherwise requires: 
  
 (1) a term has the meaning assigned to it; 
  
 (2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP; 
  
 (3)
“or” is not exclusive; 
  
 (4)
“including” means including without limitation; 
  
 (5) words in the singular include the plural and words in the plural include the singular; 
  
 (6) unsecured Indebtedness shall not be deemed to be subordinate or junior in right of payment to secured Indebtedness merely by virtue of
its nature as unsecured Indebtedness; 
  
 (7)
secured Indebtedness shall not be deemed to be subordinate or junior in right of payment to any other secured Indebtedness merely because it has a junior priority with respect to the same collateral; 
  
 (8) the principal amount of any non-interest bearing or
other discount security at any date shall be the principal amount thereof that would be shown on a balance sheet of the issuer dated such date prepared in accordance with GAAP; 
  
 (9) “herein,” “hereunder” and “hereof” and other words of similar import refer
to this Indenture as a whole and not to any particular Article, Section or other subdivision; 
  
 (10) the principal amount of any Preferred Stock shall be (A) the maximum liquidation value of such Preferred Stock or (B) the maximum
mandatory redemption or mandatory repurchase price with respect to such Preferred Stock, whichever is greater; and 
  
 (11) all references to the date the Securities were originally issued shall refer to the Issue Date. 
  

 40 








 Article 2 
  

The Securities 
  
 SECTION 2.01 Form and Dating. Provisions relating to the Initial Securities, the Private Exchange Securities and the Exchange Securities are set
forth in the Rule 144A/Regulation S/IAI Appendix attached hereto (the “Appendix”) which is hereby incorporated in, and expressly made part of, this Indenture. The Initial Securities and the Trustee’s certificate of authentication
shall be substantially in the form of Exhibit 1 to the Appendix which is hereby incorporated in, and expressly made a part of, this Indenture. The Exchange Securities, the Private Exchange Securities and the Trustee’s certificate of
authentication shall be substantially in the form of Exhibit A, which is hereby incorporated in and expressly made a part of this Indenture. The Securities may have notations, legends or endorsements required by law, stock exchange rule, agreements
to which the Company is subject, if any, or usage (provided that any such notation, legend or endorsement is in a form acceptable to the Company). Each Security shall be dated the date of its authentication. The terms of the Securities set
forth in the Appendix and Exhibit A are part of the terms of this Indenture. 
  
 SECTION 2.02 Execution and Authentication. Two Officers shall execute the Securities for the Company by manual or facsimile signature. 
  
 If an Officer whose signature is on a Security no longer holds that office at the time the Trustee authenticates the
Security, the Security shall be valid nevertheless. 
  
 A Security
shall not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on the Security. The signature shall be conclusive evidence that the Security has been authenticated under this Indenture. 

 
 On the Issue Date, the Trustee shall authenticate and deliver $200.0
million of 113⁄4% Senior Notes due 2008 and, at any time and from time to time thereafter, the Trustee shall authenticate and deliver Securities for original issue in an aggregate principal amount specified in such order, in each case upon a
written order of the 

  

 41 








 
Company signed by two Officers or by an Officer and either an Assistant Treasurer or an Assistant Secretary of the Company. Such order shall specify the
amount of the Securities to be authenticated and the date on which the original issue of Securities is to be authenticated and, in the case of an issuance of Additional Securities pursuant to Section 2.13 after the Issue Date, shall certify that
such issuance is in compliance with Section 4.03. 
  
 The Trustee
may appoint an authenticating agent reasonably acceptable to the Company to authenticate the Securities. Unless limited by the terms of such appointment, an authenticating agent may authenticate Securities 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 any Registrar, Paying Agent or agent for service of notices and demands. 
  
 SECTION 2.03 Registrar and Paying Agent. The Company shall maintain an
office or agency where Securities may be presented for registration of transfer or for exchange (the “Registrar”) and an office or agency where Securities may be presented for payment (the “Paying Agent”). The Registrar shall
keep a register of the Securities and of their transfer and exchange. The Company may have one or more co-registrars and one or more additional paying agents. The term “Paying Agent” includes any additional paying agent. 
  
 The Company shall enter into an appropriate agency agreement with any
Registrar, Paying Agent or co-registrar not a party to this Indenture, which shall incorporate the terms of the TIA. The agreement shall implement the provisions of this Indenture that relate to such agent. The Company shall notify the Trustee of
the name and address of any such agent. If the Company fails to maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.07. The Company or any Wholly Owned
Subsidiary incorporated or organized within The United States of America may act as Paying Agent, Registrar, co-registrar or transfer agent. 
  
 The Company hereby appoints the Trustee as initial Registrar and Paying Agent in connection with the Securities and the Trustee hereby accepts such
appointments, subject to the terms herein. 
  

 42 








 SECTION 2.04 Paying Agent To Hold Money in Trust. Prior to each due date of the principal and
interest on any Security, the Company shall deposit with the Paying Agent a sum sufficient to pay such principal and interest when so becoming due. The Company 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 Securityholders or the Trustee all money held by the Paying Agent for the payment of principal of or interest on the Securities and shall notify the Trustee of any default by the Company in making
any such payment. If the Company or a Subsidiary acts as Paying Agent, it shall segregate the money held by it as Paying Agent and hold it as a separate trust fund. The Company at any time may require a Paying Agent to pay all money held by it to
the Trustee and to account for any funds disbursed by the Paying Agent. Upon complying with this Section, the Paying Agent shall have no further liability for the money delivered to the Trustee. 
  
 SECTION 2.05 Securityholder 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 Securityholders. If the Trustee is not the Registrar, the Company shall furnish to the Trustee, in writing at least five 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 Securityholders. 
  
 SECTION 2.06 Transfer and Exchange. The Securities shall be issued in
registered form and shall be transferable only upon the surrender of a Security for registration of transfer. When a Security is presented to the Registrar or a co-registrar with a request to register a transfer, the Registrar shall register the
transfer as requested if the requirements of this Indenture and Section 8-401(1) of the Uniform Commercial Code are met. When Securities are presented to the Registrar or a co-registrar with a request to exchange them for an equal principal amount
of Securities of other denominations, the Registrar shall make the exchange as requested if the same requirements are met. 
  
 SECTION 2.07 Replacement Securities. If a mutilated Security is surrendered to the Registrar or if the Holder of a Security claims that the
Security has been 

  

 43 








 
lost, destroyed or wrongfully taken, the Company shall issue and the Trustee shall authenticate a replacement Security if the requirements of Section 8-405
of the Uniform Commercial Code are met and the Holder satisfies any other reasonable requirements of the Trustee. If required by the Trustee or the Company, such Holder shall furnish an indemnity bond sufficient in the judgment of the Company and
the Trustee to protect the Company, the Trustee, the Paying Agent, the Registrar and any co-registrar from any loss which any of them may suffer if a Security is replaced. The Company and the Trustee may charge the Holder for their expenses in
replacing a Security. 
  
 Every replacement Security is an
additional Obligation of the Company. 
  
 SECTION 2.08
Outstanding Securities. Securities outstanding at any time are all Securities authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation and those described in this Section as not outstanding. A
Security does not cease to be outstanding because the Company or an Affiliate of the Company holds the Security. 
  
 If a Security is replaced pursuant to Section 2.07, it ceases to be outstanding unless the Trustee and the Company receive proof satisfactory to them that
the replaced Security is held by a bona fide purchaser. 
  
 If (i) the Paying Agent segregates and holds in trust, in accordance with this Indenture, on a redemption date or maturity date money sufficient to pay all principal and interest payable on that date with respect to the Securities (or
portions thereof) to be redeemed or maturing, as the case may be, or (ii) if all principal of and accrued interest on any Security is considered paid under Section 4.01 hereof, then on and after that date such Securities (or portions thereof) cease
to be outstanding and interest on them ceases to accrue. 
  
 SECTION 2.09 Temporary Securities. Until definitive Securities are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Securities. Temporary Securities shall be substantially in the form of
definitive Securities but may have variations that the Company considers appropriate for temporary 

  

 44 








 
Securities. Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate definitive Securities and deliver them in exchange for
temporary Securities. 
  
 SECTION 2.10 Cancellation. The
Company at any time may deliver Securities to the Trustee for cancellation. The Registrar and the Paying Agent shall forward to the Trustee any Securities surrendered to them for registration of transfer, exchange or payment. The Trustee and no one
else shall cancel and destroy (subject to the record retention requirements of the Exchange Act) all Securities surrendered for registration of transfer, exchange, payment or cancellation and deliver a certificate of such destruction to the Company
unless the Company directs the Trustee to deliver canceled Securities to the Company. The Company may not issue new Securities to replace Securities it has redeemed, paid or delivered to the Trustee for cancellation. 
  
 SECTION 2.11 Defaulted Interest. If the Company defaults in a payment
of interest on the Securities, the Company shall pay defaulted interest (plus interest on such defaulted interest to the extent lawful) in any lawful manner. The Company may pay the defaulted interest to the persons who are Securityholders on a
subsequent special record date. The Company shall fix or cause to be fixed any such special record date and payment date to the reasonable satisfaction of the Trustee and shall promptly mail to each Securityholder a notice that states the special
record date, the payment date and the amount of defaulted interest to be paid. 
  
 SECTION 2.12 CUSIP and ISIN Numbers. The Company in issuing the Securities may use “CUSIP” and “ISIN” numbers (if then generally in use) and, if so, the Trustee shall use “CUSIP”
and “ISIN” numbers in notices of redemption as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the
Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers.

  
 SECTION 2.13 Issuance of Additional Securities. The
Company shall be entitled, subject to its compliance 

  

 45 








 
with Section 4.03, to issue Additional Securities under this Indenture which shall have identical terms and the same CUSIP numbers as the Initial Securities
issued on the Issue Date, other than with respect to the date of issuance and issue price. The Initial Securities issued on the Issue Date, any Additional Securities and all Exchange Securities or Private Exchange Securities issued in exchange
therefor shall be treated as a single class for all purposes under this Indenture. Notwithstanding the foregoing, in no event shall the Company issue Additional Securities unless such Additional Securities are fungible with the Initial Securities
issued on the Issue Date for U.S. Federal income tax purposes. 
  
 With respect to any Additional Securities, the Company shall set forth in a resolution of the Board of Directors and an Officers’ Certificate, a copy of each which shall be delivered to the Trustee, the following information:

  
 (1) the aggregate principal amount of such
Additional Securities to be authenticated and delivered pursuant to this Indenture and the provision of Section 4.03 that the Company is relying on to issue such Additional Securities; 
  
 (2) the issue price, the issue date and the CUSIP number of such Additional Securities; provided,
however, that no Additional Securities may be issued at a price that would cause such Additional Securities to have “original issue discount” within the meaning of Section 1273 of the Code; and 
  
 (3) whether such Additional Securities shall be Transfer
Restricted Securities and issued in the form of Initial Securities as set forth in the Appendix to this Indenture or shall be issued in the form of Exchange Securities as set forth in Exhibit A. 
  
 Article 3 
  
 Redemption 
  
 SECTION 3.01 Notices to Trustee. If the Company elects to redeem Securities pursuant to paragraph 5 of the Securities, it shall notify the Trustee
in writing of the redemption date, the principal amount of Securities 

  

 46 








 
to be redeemed and the paragraph of the Securities pursuant to which the redemption will occur. 
  
 The Company shall give each notice to the Trustee provided for in this Section at least 30 days before the redemption date
unless the Trustee, in its sole discretion, consents to a shorter period. Such notice shall be accompanied by an Officers’ Certificate and an Opinion of Counsel from the Company to the effect that such redemption will comply with the conditions
herein. 
  
 SECTION 3.02 Selection of Securities to Be
Redeemed. If fewer than all the Securities are to be redeemed, the Trustee shall select the Securities to be redeemed pro rata or by lot or by a method that complies with applicable legal and securities exchange requirements, if
any, and that the Trustee in its sole discretion shall deem to be fair and appropriate and in accordance with methods generally used at the time of selection by fiduciaries in similar circumstances. The Trustee shall make the selection from
outstanding Securities not previously called for redemption. The Trustee may select for redemption portions of the principal of Securities that have denominations larger than $1,000. Securities and portions of them the Trustee selects shall be in
principal amounts of $1,000 or a whole multiple of $1,000. Provisions of this Indenture that apply to Securities called for redemption also apply to portions of Securities called for redemption. The Trustee shall notify the Company promptly of the
Securities or portions of Securities to be redeemed. 
  
 SECTION
3.03 Notice of Redemption. At least 30 days but not more than 60 days before a date for redemption of Securities, the Company shall mail a notice of redemption by first-class mail to each Holder of Securities to be redeemed at such
Holder’s registered address. 
  
 The notice shall identify
the Securities to be redeemed and shall state: 
  
 (1) the redemption date; 
  
 (2) the
redemption price; 
  
 (3) the name and address of
the Paying Agent; 
  

 47 








 (4) that Securities called for redemption must be surrendered to the Paying Agent to
collect the redemption price; 
  
 (5) if fewer
than all the outstanding Securities are to be redeemed, the identification and principal amounts of the particular Securities to be redeemed; 
  
 (6) that, unless the Company defaults in making such redemption payment, interest on Securities (or portion thereof) called for redemption
ceases to accrue on and after the redemption date; and 
  
 (7) that no representation is made as to the correctness or accuracy of the CUSIP, ISIN or other similar number, if any, listed in such notice or printed on the Securities. 
  
 At the Company’s request, the Trustee shall give the notice of redemption in the Company’s name and at the
Company’s expense. In such event, the Company shall provide the Trustee with the information required by this Section. 
  
 SECTION 3.04 Effect of Notice of Redemption. Once notice of redemption is mailed, Securities called for redemption become due and payable on the
redemption date and at the redemption price stated in the notice. Upon surrender to the Paying Agent, such Securities shall be paid at the redemption price stated in the notice, plus accrued interest to the redemption date (subject to the right of
Holders of record on the relevant record date to receive interest due on the related interest payment date). Failure to give notice or any defect in the notice to any Holder shall not affect the validity of the notice to any other Holder.

  
 SECTION 3.05 Deposit of Redemption Price. On or prior
to the redemption date, the Company shall deposit with the Paying Agent (or, if the Company or a Subsidiary is the Paying Agent, shall segregate and hold in trust) money sufficient to pay the redemption price of and accrued interest on all
Securities to be redeemed on that date other than Securities or portions of Securities called for redemption which have been delivered by the Company to the Trustee for cancellation. 
  

 48 








 SECTION 3.06 Securities Redeemed in Part. Upon surrender of a Security that is redeemed in part,
the Company shall execute and the Trustee shall authenticate for the Holder (at the Company’s expense) a new Security equal in principal amount to the unredeemed portion of the Security surrendered. 
  
 Article 4 
  
 Covenants 
  
 SECTION 4.01 Payment of Securities. The Company shall promptly pay the principal of and interest on the Securities on the dates and in the manner
provided in the Securities and in this Indenture. Principal and interest shall be considered paid on the date due if on such date the Trustee or the Paying Agent holds in accordance with this Indenture money sufficient to pay all principal and
interest then due. 
  
 The Company shall pay interest on overdue
principal at the rate specified therefor in the Securities, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful. 
  

SECTION 4.02 SEC Reports. Whether or not the Company is subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the
Company shall furnish to the Trustee and the Holders and, after the effectiveness of the Exchange Offer Registration Statement or Shelf Registration Statement filed in respect of the Initial Securities issued on the Issue Date, shall file with the
SEC (subject to the next sentence) such annual and other reports as are specified in Sections 13 and 15(d) of the Exchange Act and applicable to a U.S. corporation subject to such Sections, such reports to be so provided or filed at the times
specified for the filings of such reports under such Sections and containing all the information, audit reports and exhibits required for such reports. If at any time after the effectiveness of such Exchange Offer Registration Statement or Shelf
Registration Statement, the Company is not subject to the periodic reporting requirements of the Exchange Act for any reason, the Company shall nevertheless continue filing the reports specified in the preceding sentence with the SEC within the time
periods required unless the SEC will not accept such a filing. The Company shall not take any action for the purpose of causing the SEC not to accept any such filings. 

  

 49 








 
If, notwithstanding the foregoing, the SEC will not accept such filings for any reason, the Company shall post the reports specified in the preceding
sentence on its website within the time periods that would apply if the Company were required to file those reports with the SEC. Notwithstanding the foregoing, the Company shall be entitled to satisfy such requirements prior to the effectiveness of
such Exchange Offer Registration Statement or such Shelf Registration Statement by filing with the SEC such Exchange Offer Registration Statement or Shelf Registration Statement, to the extent that any such Registration Statement contains
substantially the same information as would be required to be filed by the Company if it were subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, and by providing the Trustee and Holders with such Registration Statement
(and any amendments thereto) promptly following the filing thereof. 
  
 At any time that any of the Company’s Subsidiaries are Unrestricted Subsidiaries, then the quarterly and annual financial information required by the preceding paragraph shall include a reasonably detailed presentation, either on the
face of the financial statements or in the footnotes thereto, and in “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” of the financial condition and results of operations of the Company and its
Restricted Subsidiaries separate from the financial condition and results of operations of the Unrestricted Subsidiaries of the Company. 
  
 In addition, the Company shall furnish to the Holders of the Securities and to prospective investors, upon the requests of such Holders, any information
required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act so long as the Securities are not freely transferable under the Securities Act. The Company also shall comply with the other provisions of TIA § 314(a). 

 
 Delivery of any such reports, information and documents to the Trustee
pursuant to any provision of this Section is for informational purposes only and the Trustee’s receipt of such shall not constitute notice or constructive notice of any information contained therein or determinable from information contained
therein, including the Company’s compliance with any of its covenants 

  

 50 








 
hereunder (as to which the Trustee is entitled to rely exclusively on Officers’ Certificates). 
  
 SECTION 4.03 Limitation on Indebtedness. (a) The Company shall not,
and shall not permit any Restricted Subsidiary to, Incur, directly or indirectly, any Indebtedness; provided, however, that the Company shall be entitled to Incur Indebtedness if, on the date of such Incurrence and after giving effect
thereto on a pro forma basis, no Default has occurred and is continuing and the Consolidated Leverage Ratio would be less than 3.0 to 1.0. 
  
 (b) Notwithstanding the foregoing paragraph (a), the Company and the Restricted Subsidiaries shall be entitled to Incur any or all of the following
Indebtedness: 
  
 (1) Permitted Warehouse
Indebtedness existing on the Issue Date or created thereafter; provided, however, that to the extent any such Indebtedness of the Company or a Restricted Subsidiary ceases to constitute Permitted Warehouse Indebtedness, such
Indebtedness shall be deemed to be Incurred by the Company or such Restricted Subsidiary, as the case may be, at such time; 
  
 (2) Indebtedness owed to and held by the Company or a Restricted Subsidiary; provided, however, that (A) any subsequent
issuance or transfer of any Capital Stock which results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any subsequent transfer of such Indebtedness (other than to the Company or a Restricted Subsidiary) shall be deemed,
in each case, to constitute the Incurrence of such Indebtedness by the obligor thereon and (B) if the Company is the obligor on such Indebtedness, such Indebtedness is expressly subordinated to the prior payment in full in cash of all obligations
with respect to the Securities; 
  
 (3)
the Securities (other than any Additional Securities); 
  
 (4) Indebtedness outstanding on the Issue Date (other than Indebtedness described in clause (1), (2) or (3) of this Section 4.03(b)); 
  
 (5) Indebtedness of a Restricted Subsidiary Incurred and outstanding on or prior to the date on 

  

 51 








 
which such Subsidiary was acquired by the Company (other than Indebtedness Incurred in connection with, or to provide all or any portion of the funds or
credit support utilized to consummate, the transaction or series of related transactions pursuant to which such Subsidiary became a Subsidiary or was acquired by the Company); provided, however, that on the date of such acquisition and
after giving pro forma effect thereto, the Company would have been able to Incur at least $1.00 of additional Indebtedness pursuant to Section 4.03(a); 
  
 (6) Refinancing Indebtedness in respect of Indebtedness Incurred pursuant to Section 4.03(a) or pursuant to
clause (3), (4) or (5) of this Section 4.03(b) or this clause (6); provided, however, that to the extent such Refinancing Indebtedness directly or indirectly Refinances Indebtedness of a Subsidiary Incurred pursuant to clause (5), such
Refinancing Indebtedness shall be Incurred only by such Subsidiary; 
  
 (7) Hedging Obligations Incurred by the Company or a Restricted Subsidiary consisting of Interest Rate Agreements directly related to (i) Indebtedness Incurred by the Company and its Restricted Subsidiaries in
accordance with this Indenture; (ii) Receivables held by the Company or its Restricted Subsidiaries pending sale or securitization; (iii) Receivables or Servicing Receivables of the Company or its Restricted Subsidiaries that are subject to a
Warehouse Facility; (iv) Receivables that the Company reasonably expects to purchase or commit to purchase, finance or accept as collateral; or (v) Excess Spread Receivables and other assets owned or financed by the Company or its Restricted
Subsidiaries in the ordinary course of business; provided, however, that such Hedging Obligations are eligible to receive hedge accounting treatment in accordance with GAAP as applied by the Company on the Issue Date; 
  
 (8) Obligations in respect of performance, bid and surety
bonds and completion guarantees provided by the Company or any Restricted Subsidiary in the ordinary course of business; 
  

 52 








 (9) Indebtedness arising from the honoring by a bank or other financial institution of a
check, draft or similar instrument drawn against insufficient funds in the ordinary course of business; provided, however, that such Indebtedness is extinguished within two Business Days of its Incurrence; and 
  
 (10) Indebtedness of the Company in an aggregate principal
amount which, when taken together with all other Indebtedness of the Company outstanding on the date of such Incurrence (other than Indebtedness permitted by clauses (1) through (9) of this Section 4.03(b) or Section 4.03(a)) does not exceed $15.0
million. 
  
 (c) Notwithstanding the foregoing, the Company shall
not Incur any Indebtedness pursuant to Section 4.03(b) if the proceeds thereof are used, directly or indirectly, to Refinance any Subordinated Obligations unless such Indebtedness shall be subordinated to the Securities to at least the same extent
as such Subordinated Obligations. 
  
 (d) For purposes of
determining compliance with this Section 4.03, (1) in the event that an item of Indebtedness (or any portion thereof) meets the criteria of more than one of the types of Indebtedness described in this Section, the Company, in its sole discretion,
shall classify such item of Indebtedness or any portion thereof at the time of Incurrence and shall only be required to include the amount and type of such Indebtedness in one of the above clauses and (2) the Company shall be entitled to divide and
classify an item of Indebtedness in more than one of the types of Indebtedness described in this Section. 
  
 SECTION 4.04 Limitation on Restricted Payments. (a) The Company shall not, and shall not permit any Restricted Subsidiary, directly or indirectly,
to make a Restricted Payment if at the time the Company or such Restricted Subsidiary makes such Restricted Payment: 
  
 (1) a Default shall have occurred and be continuing (or would result therefrom); 
  
 (2) the Company is not entitled to Incur an additional $1.00
of Indebtedness under Section 4.03(a); or 
  

 53 








 (3) the aggregate amount of such Restricted Payment and all other Restricted Payments
since the Issue Date would exceed the sum of (without duplication): 
  
 (A) (i) 50% of the Consolidated Net Income accrued during each fiscal quarter that both (a) commences after the consummation of an Initial Public Equity Offering and (b) at the end of which the Consolidated Leverage
Ratio is less than 1.5 to 1.0 and (ii) 25% of the Consolidated Net Income accrued during each other fiscal quarter, in each case during the period from the beginning of the fiscal quarter immediately following the fiscal quarter during which the
Issue Date occurs to the end of the most recent fiscal quarter ending at least 45 days prior to the date of such Restricted Payment (or, in case such Consolidated Net Income during such period (treated as a single accounting period) shall be a
deficit, minus 100% of such deficit); plus 
  
 (B) 100% of the aggregate Net Cash Proceeds, and 100% of the aggregate Net Fair Market Value of property other than cash, in each case received by the Company from the issuance or sale of its Capital Stock (other than Disqualified
Stock) subsequent to the Issue Date (other than an issuance or sale to a Subsidiary of the Company and other than an issuance or sale to an employee stock ownership plan or to a trust established by the Company or any of its Subsidiaries for the
benefit of their employees) and 100% of any cash capital contribution received by the Company from its shareholders subsequent to the Issue Date; plus 
  

(C) the amount by which Indebtedness of the Company is reduced on the Company’s balance sheet upon the conversion or exchange
(other than by a Subsidiary of the Company) subsequent to the Issue Date of any Indebtedness of the Company convertible or exchangeable for Capital Stock (other than Disqualified Stock) of the Company (less the amount of any cash, or the fair value
of any other property, distributed by the Company upon such conversion or exchange); provided, however, that the foregoing amount shall not 

  

 54 








 
exceed the Net Cash Proceeds received by the Company or any Restricted Subsidiary from the sale of such Indebtedness (excluding Net Cash Proceeds from sales
to a Subsidiary of the Company or to an employee stock ownership plan or to a trust established by the Company or any of its Subsidiaries for the benefit of their employees); plus 
  
 (D) an amount equal to the sum of (i) the net reduction in the Investments (other than Permitted
Investments) made by the Company or any Restricted Subsidiary in any Person resulting from repurchases, repayments or redemptions of such Investments by such Person, proceeds realized on the sale of such Investment and proceeds representing the
return of capital (excluding dividends and distributions), in each case received by the Company or any Restricted Subsidiary and (ii) to the extent such Person is an Unrestricted Subsidiary, the portion (proportionate to the Company’s equity
interest in such Subsidiary) of the fair market value of the net assets of such Unrestricted Subsidiary at the time such Unrestricted Subsidiary is designated a Restricted Subsidiary; provided, however, that the foregoing sum shall not
exceed, in the case of any such Person or Unrestricted Subsidiary, the amount of Investments (excluding Permitted Investments) previously made (and treated as a Restricted Payment) by the Company or any Restricted Subsidiary in such Person or
Unrestricted Subsidiary. 
  
 With respect to any proposed dividend
or other distribution in respect of the Capital Stock of the Company to be made by the Company based upon the receipt of the Net Cash Proceeds of an Initial Public Equity Offering, the Company shall be entitled to declare such dividend or
distribution not more than 30 Business Days prior to the consummation of such Initial Public Equity Offering without having to comply with this Section 4.04, provided that such dividend or distribution shall be paid within 10 days after, and
is conditioned upon (to the extent permitted by applicable law), the closing of such Initial Public Equity Offering, and such payment otherwise complies with this Section 4.04 at the time of payment. 
  

 55 








 (b) The provisions of Section 4.04(a) shall not prohibit: 
  
 (1) any Restricted Payment made out of the Net Cash Proceeds
of the substantially concurrent sale of, or made by exchange for, Capital Stock of the Company (other than Disqualified Stock and other than Capital Stock issued or sold to a Subsidiary of the Company or an employee stock ownership plan or to a
trust established by the Company or any of its Subsidiaries for the benefit of their employees) or a substantially concurrent cash capital contribution received by the Company from its shareholders; provided, however, that (A) such
Restricted Payment shall be excluded in the calculation of the amount of Restricted Payments and (B) the Net Cash Proceeds from such sale or such cash capital contribution (to the extent so used for such Restricted Payment) shall be excluded from
the calculation of amounts under Section 4.04(a)(3)(B); 
  
 (2) any purchase, repurchase, redemption, defeasance or other acquisition or retirement for value of Subordinated Obligations of the Company made by exchange for, or out of the proceeds of the substantially concurrent
sale of, Indebtedness of the Company which is permitted to be Incurred pursuant to Section 4.03; provided, however, that such purchase, repurchase, redemption, defeasance or other acquisition or retirement for value shall be excluded
in the calculation of the amount of Restricted Payments; 
  
 (3) dividends or distributions paid within 60 days after the date of declaration thereof if at such date of declaration such dividend or distribution would have complied with this Section 4.04; provided,
however, that at the time of payment of such dividend or distribution, no other Default shall have occurred and be continuing (or result therefrom); provided further, however, that such dividend or distribution shall be
included in the calculation of the amount of Restricted Payments; 
  
 (4) so long as no Default has occurred and is continuing, the repurchase or other acquisition of shares of Capital Stock of the Company from any current, future or former employees, directors or consultants of the
Company or any of its Subsidiaries 

  

 56 








 
(or permitted transferees of such employees, directors or consultants), pursuant to the terms of the agreements (including employment agreements) or plans
(or amendments thereto) approved by the Board of Directors under which such individuals purchase or sell or are granted the option to purchase or sell, shares of such Capital Stock; provided, however, that the aggregate amount of such
repurchases and other acquisitions (excluding amounts representing cancelation of Indebtedness) shall not exceed $5.0 million in any calendar year; provided further, however, that such repurchases and other acquisitions shall be
excluded in the calculation of the amount of Restricted Payments; 
  
 (5) repurchases of Capital Stock deemed to occur upon exercise of stock options if such Capital Stock represents a portion of the exercise price of such options; provided, however, that such Restricted
Payments shall be excluded in the calculation of the amount of Restricted Payments; 
  
 (6) cash payments in lieu of the issuance of fractional shares in connection with the exercise of warrants, options or other securities
convertible into or exchangeable for Capital Stock of the Company; provided, however, that any such cash payment shall not be for the purpose of evading the limitation of this Section 4.04 (as determined in good faith by the Board of
Directors); provided further, however, that such payments shall be excluded in the calculation of the amount of Restricted Payments; 
  
 (7) the dividend in respect of the Capital Stock of the Company on the Issue Date from the Net Cash Proceeds of the Securities, in an
amount not to exceed $157.0 million; provided, however, that such dividend shall be excluded in the calculation of the amount of Restricted Payments; 
  
 (8) Restricted Payments in an aggregate amount which, when taken together with all Restricted Payments made
pursuant to this clause (8) which have not been repaid, does not exceed $15.0 million; provided, however, that (A) at the time of such Restricted Payments, no Default shall have occurred and be continuing (or would result therefrom)
and 

  

 57 








 
(B) such Restricted Payments shall be excluded in the calculation of the amount of Restricted Payments; 
  
 (9) Investments that are made with Excluded Contributions;
provided, however, that such Investments shall be excluded in the calculation of the amount of Restricted Payments; 
  
 (10) the acquisition of any shares of Disqualified Stock of the Company either: 
  
 (A) solely in exchange for shares of Disqualified Stock of
the Company; or 
  
 (B) through the application
of the Net Cash Proceeds of a substantially concurrent sale (other than to a Subsidiary of the Company) of shares of Disqualified Stock of the Company; 
  
 provided, however, that, in either such case, (i) such Disqualified Stock is permitted to be issued pursuant to Section 4.03 and (ii) such
acquisition shall be excluded in the calculation of the amount of Restricted Payments; 
  
 (11) so long as no Default shall have occurred and be continuing or would result therefrom, the repurchase, redemption or other
acquisition or retirement for value of Subordinated Obligations, at a purchase price not greater than 101% of the principal amount of such Subordinated Obligations, plus any accrued and unpaid interest thereon, (a) with any excess Net Available Cash
from Asset Dispositions to the extent such excess Net Available Cash is permitted to be used for general corporate purposes under Section 4.06 or (b) with, after the completion of a Change of Control Offer pursuant to the terms of Section 4.09, cash
offered to redeem Securities pursuant to such Change of Control Offer less any cash paid to Holders of Securities pursuant to such Change of Control Offer; provided, however, that (i) in the case of both clauses (a) and (b), the
Company shall have repurchased all Securities validly tendered and not withdrawn in connection with such Offer and (ii) such payments shall be included in the calculation of Restricted Payments; 
  

 58 








 (12) Investments in Unrestricted Subsidiaries having an aggregate Fair Market Value,
taken together with all other Investments made pursuant to this clause (12) that are at the time outstanding, not to exceed $10.0 million at the time of such Investment (with the Fair Market Value of each Investment being measured at the time made
and without giving effect to subsequent changes in value); provided, however, that such Investments shall be excluded in the calculation of the amount of Restricted Payments; or 
  
 (13) to the extent that such payments constitute Restricted
Payments, cash payments pursuant to the terms of the June 2003 Bonus Plan and December 2003 Bonus Plan as in effect on the Issue Date; provided, however, that such payments shall be excluded in the calculation of the amount of
Restricted Payments. 
  
 The amount of all Restricted Payments
(other than cash) will be the Fair Market Value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Company or such Restricted Subsidiary, as the case may be, pursuant to the Restricted
Payment. The Fair Market Value of any assets or securities that are required to be valued by this Section 4.04 will be determined in good faith by the Company. For purposes of clauses (b)(1) and (b)(2) of this Section 4.04, a Restricted Payment
shall be deemed to be “substantially concurrent” with a sale, exchange or contribution, as the case may be, if and only if made within 30 days of such sale or contribution. 
  
 (c) Notwithstanding anything to the contrary contained in this Section 4.04, from and after the date of consummation of an
Initial Public Equity Offering to, but excluding, the date on which no less than 25% of the aggregate principal amount of the Securities (which includes Additional Securities, if any) originally issued have been redeemed by the Company pursuant to
paragraph 5 of the Securities, the Company shall not, and shall not permit any Restricted Subsidiary to, (i) make any Restricted Payment or (ii) make any Permitted Investment pursuant to clause (15) of the definition thereof. 
  
 SECTION 4.05 Limitation on Restrictions on Distributions from Restricted
Subsidiaries. The Company shall not, and shall not permit any Restricted Subsidiary to, create or otherwise cause or permit to exist or become 

  

 59 








 
effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to (a) pay dividends or make any other distributions on its
Capital Stock to the Company or a Restricted Subsidiary or pay any Indebtedness owed to the Company, (b) make any loans or advances to the Company or (c) transfer any of its property or assets to the Company, except: 
  
 (1) with respect to clauses (a), (b) and (c), 
  
 (A) any encumbrance or restriction pursuant to an agreement
in effect at or entered into on the Issue Date; 
  
 (B) any customary (as conclusively determined in good faith by the Chief Financial Officer of the Company) encumbrance or restriction applicable to a Restricted Subsidiary contained in an agreement or instrument governing or relating to
Indebtedness Incurred pursuant to Section 4.03(b)(1); provided, however, that, except upon or during the continuation of a default or event of default under the agreement or instrument governing or relating to such Indebtedness, such
encumbrances and restrictions permit the distribution of funds to the Company in an amount sufficient for the Company to make the timely payment of interest, premium (if any) and principal (whether at stated maturity, by way of a sinking fund
applicable thereto, by way of any mandatory redemption, defeasance, retirement or repurchase thereof, including upon the occurrence of designated events or circumstances or by virtue of acceleration upon an event of default, or by way of redemption
or retirement at the option of the holders or lenders of Indebtedness, including pursuant to offers to purchase) according to the terms of this Indenture and the Securities and other Indebtedness that is solely an obligation of the Company;
provided further, however, that such agreement may nevertheless contain customary (as so determined) net worth, leverage, invested capital and other financial covenants, customary (as so determined) covenants regarding the merger of or
sale of all or any substantial part of the assets of the Company or any Restricted Subsidiary, restrictions on transactions with 

  

 60 








 
affiliates and customary (as so determined) subordination provisions governing Indebtedness owed to the Company or any Restricted Subsidiary; 
  
 (C) any encumbrance or restriction with respect to a
Restricted Subsidiary pursuant to an agreement relating to any Indebtedness Incurred by such Restricted Subsidiary on or prior to the date on which such Restricted Subsidiary was acquired by the Company (other than Indebtedness Incurred as
consideration in, or to provide all or any portion of the funds or credit support utilized to consummate, the transaction or series of related transactions pursuant to which such Restricted Subsidiary became a Restricted Subsidiary or was acquired
by the Company) and outstanding on such date; 
  
 (D) any encumbrance or restriction pursuant to an agreement effecting a Refinancing of Indebtedness Incurred pursuant to an agreement referred to in Section 4.05(1)(A) or (C) or this clause (D) or contained in any amendment to an agreement
referred to in Section 4.05(1)(A) or (C) or this clause (D); provided, however, that the encumbrances and restrictions with respect to such Restricted Subsidiary contained in any such refinancing agreement or amendment are no less
favorable to the Securityholders than encumbrances and restrictions with respect to such Restricted Subsidiary contained in such predecessor agreements; and 
  
 (E) any encumbrance or 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 
  
 (2) with respect to clause (c) only, 
  
 (A) any encumbrance or restriction consisting of customary nonassignment provisions in leases governing leasehold interests to the extent
such provisions restrict the transfer of the lease or the property leased thereunder; and 
  

 61 








 (B) any encumbrance or restriction contained in security agreements or mortgages securing
Indebtedness of a Restricted Subsidiary to the extent such encumbrance or restriction restricts the transfer of the property subject to such security agreements or mortgages. 
  
 SECTION 4.06 Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any
Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition unless (1) the Company or such Restricted Subsidiary receives consideration at the time of such Asset Disposition at least equal to the fair market value (including
as to the value of all non-cash consideration), as determined in good faith by the Board of Directors, of the shares and assets subject to such Asset Disposition; (2) at least 75% of the consideration thereof received by the Company or such
Restricted Subsidiary is in the form of cash or cash equivalents; and (3) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be) (A) first,
to the extent the Company elects (or is required by the terms of any Indebtedness), to prepay, repay, redeem or purchase Senior Indebtedness of the Company or Indebtedness (other than any Disqualified Stock) of a Wholly Owned Subsidiary (in each
case other than Indebtedness owed to the Company or an Affiliate of the Company) within one year from the later of the date of such Asset Disposition or the receipt of such Net Available Cash; (B) second, to the extent of the balance of such
Net Available Cash after application in accordance with clause (A), to the extent the Company elects, to acquire Additional Assets within one year from the later of the date of such Asset Disposition or the receipt of such Net Available Cash; and
(C) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A) and (B), to make an Offer to the Holders of the Securities (and to holders of other Senior Indebtedness of the Company
designated by the Company) to purchase Securities (and such other Senior Indebtedness of the Company) pursuant to and subject to the conditions of Section 4.06(b); provided, however, that in connection with any prepayment, repayment or
purchase of Indebtedness pursuant to clause (A) or (C) above, the Company or such Restricted Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment 

  

 62 








 
(if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Notwithstanding the foregoing provisions of
this Section 4.06, the Company and the Restricted Subsidiaries shall not be required to apply any Net Available Cash in accordance with this Section 4.06(a) except to the extent that the aggregate Net Available Cash from all Asset Dispositions which
is not applied in accordance with this Section 4.06(a) exceeds $10.0 million. Pending application of Net Available Cash pursuant to this Section 4.06(a), such Net Available Cash shall be invested in Temporary Cash Investments or applied to
temporarily reduce revolving credit indebtedness. 
  
 For the
purposes of this Section 4.06(a), the following are deemed to be cash or cash equivalents: (1) the assumption of Indebtedness of the Company (other than Obligations in respect of Disqualified Stock of the Company) or any Restricted Subsidiary and
the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness in connection with such Asset Disposition and (2) securities received by the Company or any Restricted Subsidiary from the transferee that are converted
by the Company or such Restricted Subsidiary into cash within 180 days after such Asset Disposition, to the extent of the cash received in that conversion. 
  
 (b) In the event of an Asset Disposition that requires the purchase of Securities (and other Senior Indebtedness of the Company) pursuant to Section
4.06(a)(3)(C), the Company shall purchase Securities tendered pursuant to an offer by the Company for the Securities (and such other Senior Indebtedness) (the “Offer”) at a purchase price of 100% of their principal amount (or, in the event
such other Senior Indebtedness of the Company was issued with significant original issue discount, 100% of the accreted value thereof), without premium, plus accrued but unpaid interest (or, in respect of such other Senior Indebtedness of the
Company, such lesser price, if any, as may be provided for by the terms of such Senior Indebtedness) in accordance with the procedures (including prorating in the event of oversubscription) set forth in Section 4.06(c). If the aggregate purchase
price of Securities (and any other Senior Indebtedness of the Company) tendered pursuant to the Offer exceeds the Net Available Cash allotted to their 

  

 63 








 
purchase, the Company shall select the Securities and other Senior Indebtedness of the Company to be purchased on a pro rata basis but in round
denominations, which in the case of the Securities will be denominations of $1,000 principal amount or multiples thereof. If the aggregate purchase price of the securities purchased in accordance with this Section is less than the Net Available Cash
available therefor, the Company may use any excess Net Available Cash for general corporate purposes or for any other purposes not otherwise prohibited by this Indenture. Upon completion of such an offer to purchase, Net Available Cash shall be
reset at zero. The Company shall not be required to make an Offer to purchase Securities (and other Senior Indebtedness of the Company) pursuant to this Section 4.06 if the Net Available Cash available therefor is less than $10.0 million (which
lesser amount shall be carried forward for purposes of determining whether such an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition). 
  
 (c) (1) Promptly, and in any event within 30 days after the Company becomes obligated to make an Offer, the Company shall
deliver to the Trustee and send, by first-class mail to each Holder, a written notice stating that the Holder may elect to have his Securities purchased by the Company either in whole or in part (subject to prorating as described in Section 4.06(b)
in the event the Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the
“Purchase Date”). 
  
 (2) Not later
than the date upon which written notice of an Offer is delivered to the Trustee as provided above, the Company shall deliver to the Trustee an Officers’ Certificate as to (A) the amount of the Offer (the “Offer Amount”), including
information as to any other Senior Indebtedness included in the Offer, (B) the allocation of the Net Available Cash from the Asset Dispositions pursuant to which such Offer is being made and (C) the compliance of such allocation with the provisions
of Sections 4.06(a) and (b). Upon the expiration of the period for which the Offer remains open (the “Offer Period”), the Company shall deliver to the Trustee for 

  

 64 








 
cancellation the Securities or portions thereof which have been properly tendered to and are to be accepted by the Company, and an amount in cash equal to
the aggregate purchase price of such Securities. The Trustee shall, on the Purchase Date, mail or deliver payment (or cause the delivery of payment) to each tendering Holder in the amount of the purchase price. 
  
 (3) Holders electing to have a Security purchased shall be
required to surrender the Security, with an appropriate form duly completed, to the Company at the address specified in the notice at least three Business Days prior to the Purchase Date. Holders shall be entitled to withdraw their election if the
Trustee or the Company receives, not later than one Business Day prior to the Purchase Date, a telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Security which was delivered for purchase by the
Holder and a statement that such Holder is withdrawing his election to have such Security purchased. Holders whose Securities are purchased only in part shall be issued new Securities equal in principal amount to the unpurchased portion of the
Securities surrendered. 
  
 (4) At the time the
Company delivers Securities to the Trustee which are to be accepted for purchase, the Company shall also deliver an Officers’ Certificate stating that such Securities are to be accepted by the Company pursuant to and in accordance with the
terms of this Section. A Security shall be deemed to have been accepted for purchase at the time the Trustee, directly or through an agent, mails or delivers payment therefor to the surrendering Holder. 
  
 (d) The Company shall comply, to the extent applicable, with the requirements
of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Securities pursuant to this Section 4.06. To the extent that the provisions of any securities laws or regulations conflict with
provisions of this Section 4.06, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under this Section 4.06 by virtue of its compliance with such securities laws or
regulations. 
  

 65 








 SECTION 4.07 Limitation on Affiliate Transactions. (a) The Company shall not, and shall not permit
any Restricted Subsidiary to, enter into or permit to exist any transaction (including the purchase, sale, lease or exchange of any property, employee compensation arrangements or the rendering of any service) with, or for the benefit of, any
Affiliate of the Company (an “Affiliate Transaction”) unless (1) the terms thereof are not materially less favorable to the Company or such Restricted Subsidiary than those that could reasonably have been obtained at the time of such
transaction in arm’s-length dealings with a Person who is not an Affiliate; (2) if such Affiliate Transaction involves an amount in excess of $5.0 million, the terms of the Affiliate Transaction are set forth in writing and a majority of the
directors of the Company disinterested with respect to such Affiliate Transaction have determined in good faith that the criteria set forth in clause (1) are satisfied and have approved the relevant Affiliate Transaction as evidenced by a resolution
of the Board of Directors; and (3) if such Affiliate Transaction involves an amount in excess of $20.0 million, the Board of Directors shall also have received a written opinion from an Independent Qualified Party to the effect that such Affiliate
Transaction is fair, from a financial standpoint, to the Company and its Restricted Subsidiaries or is not less favorable to the Company and its Restricted Subsidiaries than could reasonably be expected to be obtained at the time in an
arm’s-length transaction with a Person who was not an Affiliate. 
  
 (b) The provisions of Section 4.07(a) shall not prohibit: 
  
 (1) any Investment (other than a Permitted Investment) or other Restricted Payment, in each case permitted to be made pursuant to Section 4.04; 
  
 (2) any transaction with a Restricted Subsidiary or joint venture or similar entity which would constitute
an Affiliate Transaction solely because the Company or a Restricted Subsidiary owns an equity interest in or otherwise controls such Restricted Subsidiary, joint venture or similar entity; 
  
 (3) the issuance or sale of any Capital Stock (other than
Disqualified Stock) of the Company; 
  

 66 








 (4) reasonable fees and compensation paid to and indemnity provided on behalf of,
officers, directors, employees or consultants of the Company or any Restricted Subsidiary as determined in good faith by the Board of Directors; 
  
 (5) any agreement as in effect or entered into as of the Issue Date and described in the Offering Circular, or any amendment thereto or
any transaction evidenced thereby (including pursuant to any amendment thereto) in any replacement agreement thereto so long as any such amendment or replacement agreement is no less favorable to the Company or the Holders in any material respect
than the original agreement as in effect on the Issue Date; 
  
 (6) the issuance of securities or other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of, employment arrangements, stock options and stock ownership plans or similar employee
benefit plans approved by the Board of Directors in good faith, and loans or advances to employees of the Company made in good faith; 
  
 (7) the payment of all fees and expenses related to the offering and sale of the Securities; 
  
 (8) transactions with customers, clients, suppliers, or
purchasers or sellers of goods or services, in each case on ordinary business terms and otherwise in compliance with the terms of this Indenture, which are fair to the Company or its Restricted Subsidiaries, in the reasonable determination of the
Board of Directors of the Company or the senior management thereof, or are on terms at least as favorable as could reasonably have been obtained at such time from an unaffiliated party; 
  
 (9) any contribution to the capital of the Company or any sales of Capital Stock (other than Disqualified
Stock) of the Company; 
  
 (10) transactions
pursuant to Tax Sharing Agreements; and 
  

 67 








 (11) the dividend in respect of the Capital Stock of the Company on the Issue Date from
the Net Cash Proceeds of the Securities. 
  
 SECTION 4.08
Limitation on the Sale or Issuance of Capital Stock of Restricted Subsidiaries. The Company: 
  
 (1) shall not, and shall not permit any Restricted Subsidiary to, sell, lease, transfer or otherwise dispose of any Capital Stock of any
Restricted Subsidiary to any Person (other than to the Company or a Wholly Owned Subsidiary); and 
  
 (2) shall not permit any Restricted Subsidiary to issue any of its Capital Stock (other than, if necessary, shares of its Capital Stock
constituting directors’ or other legally required qualifying shares) to any Person (other than to the Company or a Wholly Owned Subsidiary) unless 
  
 (A) immediately after giving effect to such issuance, sale or other disposition, neither the Company nor any of its Subsidiaries own any
Capital Stock of such Restricted Subsidiary; or 
  
 (B) immediately after giving effect to such issuance, sale or other disposition, such Restricted Subsidiary would no longer constitute a Restricted Subsidiary and any Investment in such Person remaining after giving effect thereto is
treated as a new Investment by the Company and such Investment would be permitted to be made under Section 4.04 if made on the date of such issuance, sale or other disposition. 
  
 For purposes of this Section 4.08, the creation of a Lien on any Capital Stock of a Restricted Subsidiary to secure
Indebtedness of the Company or any of its Restricted Subsidiaries will not be deemed to be a violation of this Section 4.08; provided, however, that any sale or other disposition by the secured party of such Capital Stock following
foreclosure of its Lien will be subject to this Section 4.08. 
  
 SECTION 4.09 Change of Control. (a) Upon the occurrence of a Change of Control, each Holder shall have the right to require that the Company repurchase such Holder’s Securities at a purchase price in cash equal to 

  

 68 








 
101% of the principal amount thereof on the date of purchase plus accrued and unpaid interest, if any, to the date of purchase (subject to the right of
Holders of record on the relevant record date to receive interest on the relevant interest payment date), in accordance with the terms contemplated in Section 4.09(b). 
  
 (b) Within 30 days following any Change of Control, the Company shall mail a notice to each Holder with a copy to the
Trustee (the “Change of Control Offer”) stating: 
  
 (1) that a Change of Control has occurred and that such Holder has the right to require the Company to purchase such Holder’s Securities at a purchase price in cash equal to 101% of the principal amount thereof
on the date of purchase, plus accrued and unpaid interest, if any, to the date of purchase (subject to the right of Holders of record on the relevant record date to receive interest on the relevant interest payment date); 
  
 (2) the circumstances and relevant facts regarding such
Change of Control; 
  
 (3) the purchase date
(which shall be no earlier than 30 days nor later than 60 days from the date such notice is mailed); and 
  
 (4) the instructions, as determined by the Company, consistent with this Section 4.09, that a Holder must follow in order to have its
Securities purchased. 
  
 (c) Holders electing to have a Security
purchased shall be required to surrender the Security, with an appropriate form duly completed, to the Company at the address specified in the notice at least three Business Days prior to the purchase date. Holders shall be entitled to withdraw
their election if the Trustee or the Company receives, not later than one Business Day prior to the purchase date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Security which
was delivered for purchase by the Holder and a statement that such Holder is withdrawing his election to have such Security purchased. 
  

 69 








 (d) On the purchase date, all Securities purchased by the Company under this Section shall be delivered
by the Company to the Trustee for cancellation, and the Company shall pay the purchase price plus accrued and unpaid interest, if any, to the Holders entitled thereto. 
  
 (e) Notwithstanding the foregoing provisions of this Section, the Company shall not be required to make a Change of Control
Offer following 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 applicable to a Change of Control Offer made by the
Company and purchases all Securities validly tendered and not withdrawn under such Change of Control Offer. 
  
 (f) The Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or
regulations in connection with the repurchase of Securities pursuant to this Section 4.09. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.09, the Company shall comply with the
applicable securities laws and regulations and shall not be deemed to have breached its obligations under this Section 4.09 by virtue of its compliance with such securities laws or regulations. 
  
 SECTION 4.10 Limitation on Liens. The Company shall not, and shall not
permit any Restricted Subsidiary to, directly or indirectly, Incur or permit to exist any Lien (the “Initial Lien”) of any nature whatsoever on any of its properties (including Capital Stock of a Restricted Subsidiary), whether owned at
the Issue Date or thereafter acquired, securing any Indebtedness, other than Permitted Liens, without effectively providing that the Securities shall be secured equally and ratably with (or prior to) the obligations so secured for so long as such
obligations are so secured. Any Lien created for the benefit of the Holders of the Securities pursuant to the foregoing sentence shall provide by its terms that such Lien shall be automatically and unconditionally released and discharged upon the
release and discharge of the Initial Lien. 
  
 SECTION 4.11
Limitation on Sale/Leaseback Transactions. The Company shall not, and shall not permit any Restricted Subsidiary to, enter into any Sale/Leaseback 

  

 70 








 
Transaction with respect to any property unless (a) the Company or such Restricted Subsidiary would be entitled to (1) Incur Indebtedness in an amount equal
to the Attributable Debt with respect to such Sale/Leaseback Transaction pursuant to Section 4.03 and (2) create a Lien on such property securing such Attributable Debt without equally and ratably securing the Securities pursuant to Section 4.10,
(b) the net proceeds received by the Company or any Restricted Subsidiary in connection with such Sale/Leaseback Transaction are at least equal to the fair market value (as determined by the Board of Directors) of such property and (c) the Company
applies the proceeds of such transaction in compliance with Section 4.06. 
  
 SECTION 4.12 Limitation on Investment Company Status. The Company shall not take any action, or otherwise permit to exist any circumstance, that would require the Company to register as an “investment
company” under the Investment Company Act of 1940, as amended. 
  
 SECTION 4.13 Compliance Certificate. The Company shall deliver to the Trustee within 120 days after the end of each fiscal year of the Company an Officers’ Certificate stating whether or not the signers know of any Default that
occurred during such period. If they do, the certificate shall describe the Default, its status and what action the Company is taking or proposes to take with respect thereto. The Company also shall comply with TIA § 314(a)(4). 
  
 SECTION 4.14 Further Instruments and Acts. Upon request of the Trustee
(it being understood that the Trustee shall be under no obligation pursuant to this Section 4.14 to make any such request), the Company shall execute and deliver such further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purpose of this Indenture. 
  
 The Company shall deliver to the Trustee, as soon as possible and in any event within five days after the Company becomes aware of the occurrence of any Default or Event of Default, an Officers’ Certificate setting forth the details of
such Default or Event of Default and the action which the Company proposes to take with respect thereto. 
  

 71 








 Article 5 
  

Successor Company 
  
 SECTION 5.01 When Company May Merge or Transfer Assets. (a) The Company shall not consolidate with or merge with or into, or convey, transfer or
lease, in one transaction or a series of transactions, directly or indirectly, all or substantially all its assets to, any Person, unless: 
  
 (1) the resulting, surviving or transferee Person (the “Successor Company”) shall be a Person organized and existing under the
laws of the United States of America, any State thereof or the District of Columbia and the Successor Company (if not the Company) shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, all the obligations of the Company under the Securities and this Indenture; 
  
 (2) immediately after giving pro forma effect to such transaction (and treating any Indebtedness which becomes an obligation
of the Successor Company or any Subsidiary 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 shall have occurred and be continuing; 
  
 (3) immediately after giving pro forma effect
to such transaction, the Successor Company would be able to Incur an additional $1.00 of Indebtedness pursuant to Section 4.03(a); 
  
 (4) the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such
consolidation, merger or transfer and such supplemental indenture (if any) comply with this Indenture; and 
  
 (5) the Company shall have delivered to the Trustee an Opinion of Counsel to the effect that the Holders will not recognize income, gain
or loss for Federal income tax purposes as a result of such transaction and will be subject to Federal income tax on the same amounts, in the same manner and at the 

  

 72 








 
same times as would have been the case if such transaction had not occurred; 
  
 provided, however, that clause (3) will not be applicable to (A) a Restricted Subsidiary consolidating with, merging into or
transferring all or part of its properties and assets to the Company or (B) the Company merging with an Affiliate of the Company solely for the purpose and with the sole effect of reincorporating the Company in another jurisdiction. 
  
 For purposes of this Section 5.01, the sale, lease, conveyance, assignment,
transfer or other disposition of all or substantially all of the properties and assets of one or more Subsidiaries of the Company, which properties and assets, if held by the Company instead of such Subsidiaries, would constitute all or
substantially all of the properties and assets of the Company on a consolidated basis, shall be deemed to be the transfer of all or substantially all of the properties and assets of the Company. 
  
 The Successor Company shall be the successor to the Company and shall succeed
to, and be substituted for, and may exercise every right and power of, the Company under this Indenture, and the predecessor Company, except in the case of a lease, shall be released from the obligation to pay the principal of and interest on the
Securities. 
  
 Article 6 
  
 Defaults and Remedies 
  
 SECTION 6.01 Events of Default. An “Event of Default” occurs
if: 
  
 (1) the Company defaults in any payment
of interest on any Security when the same becomes due and payable, and such default continues for a period of 30 days; 
  
 (2) the Company (A) defaults in the payment of the principal of any Security when the same becomes due and payable at its Stated Maturity,
upon optional redemption, upon declaration of acceleration or otherwise, or (B) fails to purchase Securities when required pursuant to this Indenture or the Securities; 
  

 73 








 (3) the Company fails to comply with Section 5.01; 
  
 (4) the Company fails to comply with Section 4.02,
4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.09, 4.10, 4.11 or 4.12 (other than a failure to purchase Securities when required under Section 4.06 or 4.09) and such failure continues for 30 days after the notice specified below; 
  
 (5) the Company fails to comply with any of its agreements
in the Securities or this Indenture (other than those referred to in clause (1), (2), (3) or (4) above) and such failure continues for 60 days after the notice specified below; 
  
 (6) Indebtedness of the Company or any Significant Subsidiary is not paid within any applicable grace period
after final maturity or is accelerated by the holders thereof because of a default and the total amount of such Indebtedness unpaid or accelerated exceeds $10.0 million (or its foreign currency equivalent at the time); 
  
 (7) the Company or any Significant Subsidiary
pursuant to or within the meaning of any Bankruptcy Law: 
  
 (A) commences a voluntary case; 
  
 (B) consents to the entry of an order for relief against it in an involuntary case; 
  
 (C) consents to the appointment of a Custodian of it or for any substantial part of its property; or 
  
 (D) makes a general assignment for the benefit of its
creditors; 
  
 or takes any comparable action under any foreign
laws relating to insolvency; 
  

 74 








 (8) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law
that: 
  
 (A) is for relief against the Company
or any Significant Subsidiary in an involuntary case; 
  
 (B) appoints a Custodian of the Company or any Significant Subsidiary or for any substantial part of its property; or 
  
 (C) orders the winding up or liquidation of the Company or any Significant Subsidiary; 
  
 or any similar relief is granted under any foreign laws and the order or
decree remains unstayed and in effect for 60 days; or 
  
 (9) any judgment or decree for the payment of money in excess of $10.0 million (or its foreign currency equivalent at the time) is entered against the Company or any Significant Subsidiary, remains outstanding for a period of 60 consecutive
days following the entry of such judgment or decree and is not discharged, waived or the execution thereof stayed. 
  
 The foregoing will constitute Events of Default whatever the reason for any such Event of Default and whether it is voluntary or involuntary or is
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. 
  
 The term “Bankruptcy Law” means Title 11, United States Code, or any similar Federal or state law for the
relief of debtors. The term “Custodian” means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law. 
  
 A Default under clause (4) or (5) is not an Event of Default until the Trustee or the Holders of at least 25% in principal amount of the outstanding
Securities notify the Company of the Default and the Company does not cure such Default within the time specified after receipt of such notice. Such notice must specify the Default, demand that it be remedied and state that such notice is a
“Notice of Default”. 
  
 The Company shall deliver to
the Trustee, within 30 days after the Company obtains knowledge of the 

  

 75 








 
occurrence thereof, written notice in the form of an Officers’ Certificate of any Event of Default under clause (6) and any event which with the giving
of notice or the lapse of time would become an Event of Default under clause (4), (5) or (9), its status and what action the Company is taking or proposes to take with respect thereto. 
  
 SECTION 6.02 Acceleration. If an Event of Default (other than an Event of Default specified in Section 6.01(7) or (8)
with respect to the Company) occurs and is continuing, the Trustee by notice to the Company, or the Holders of at least 25% in principal amount of the Securities by notice to the Company and the Trustee, may declare the principal of and accrued but
unpaid interest on all the Securities to be due and payable. Upon such a declaration, such principal and interest shall be due and payable immediately. If an Event of Default specified in Section 6.01(7) or (8) with respect to the Company occurs and
is continuing, the principal of and interest on all the Securities shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Securityholders. The Holders of a
majority in principal amount of the Securities by notice to the Trustee may rescind an acceleration and its consequences if the rescission would not conflict with any judgment or decree and if all existing Events of Default have been cured or waived
except nonpayment of principal or interest that has become due solely because of acceleration. No such rescission shall affect any subsequent Default or impair any right consequent thereto. 
  
 SECTION 6.03 Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment of principal of or interest on the Securities or to enforce the performance of any provision of the Securities or this Indenture. 
  
 The Trustee may maintain a proceeding even if it does not possess any of the
Securities or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Securityholder 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. No remedy is exclusive of any other remedy. All available remedies are cumulative. 
  

 76 








 SECTION 6.04 Waiver of Past Defaults. The Holders of a majority in principal amount of the
Securities by notice to the Trustee may waive an existing Default and its consequences except (a) a Default in the payment of the principal of or interest on a Security, (b) a Default arising from the failure to redeem or purchase any Security when
required pursuant to this Indenture or (c) a Default in respect of a provision that under Section 9.02 cannot be amended without the consent of each Securityholder affected. When a Default is waived, it is deemed cured, but no such waiver shall
extend to any subsequent or other Default or impair any consequent right. 
  
 SECTION 6.05 Control by Majority. The Holders of a majority in principal amount of the Securities may 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, subject to Section 7.01, that the Trustee determines is unduly prejudicial to the rights of
other Securityholders or would involve the Trustee in personal liability; provided, however, that the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction. Prior to taking any
action under this Section, the Trustee shall be entitled to indemnification satisfactory to it in its sole discretion against all losses and expenses caused by taking or not taking such action. 
  
 SECTION 6.06 Limitation on Suits. Except to enforce the right to
receive payment of principal, premium (if any) or interest when due, no Securityholder may pursue any remedy with respect to this Indenture or the Securities unless: 
  
 (1) the Holder gives to the Trustee written notice stating that an Event of Default is continuing;

  
 (2) the Holders of at least 25% in principal
amount of the Securities make a written request to the Trustee to pursue the remedy; 
  
 (3) such Holder or Holders offer to the Trustee reasonable security or indemnity against any loss, liability or expense; 
  

 77 








 (4) the Trustee does not comply with the request within 60 days after receipt of the
request and the offer of security or indemnity; and 
  
 (5) the Holders of a majority in principal amount of the Securities do not give the Trustee a direction inconsistent with the request during such 60-day period. 
  
 A Securityholder may not use this Indenture to prejudice the rights of another Securityholder or to obtain a preference or
priority over another Securityholder. 
  
 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 interest on the Securities held by such Holder, on or after the respective due dates expressed
in the Securities, 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. 
  
 SECTION 6.08 Collection Suit by Trustee. If an Event of Default specified in Section 6.01(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 Company for the whole amount then due and owing (together with interest on any unpaid interest to the extent lawful) and the amounts provided
for in Section 7.07. 
  
 SECTION 6.09 Trustee May File Proofs
of Claim. The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee and the Securityholders allowed in any judicial proceedings relative to the Company,
its creditors or its property and, unless prohibited by law or applicable regulations, may vote on behalf of the Holders in any election of a trustee in bankruptcy or other Person performing similar functions, and any Custodian in any such judicial
proceeding is hereby authorized by each Holder to make 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 it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents and its counsel, and any other amounts due the Trustee under Section 7.07. 
  

 78 








 SECTION 6.10 Priorities. If the Trustee collects any money or property pursuant to this Article 6,
it shall pay out the money or property, or, after an Event of Default has occurred, any money or other property distributable in respect of the Company’s obligations under this Indenture shall be paid, in the following order: 
  
 FIRST: to the Trustee (including any predecessor Trustee)
for amounts due under Section 7.07; 
  
 SECOND:
to Securityholders for amounts due and unpaid on the Securities for principal and interest, ratably, without preference or priority of any kind, according to the amounts due and payable on the Securities for principal and interest, respectively; and

  
 THIRD: to the Company. 
  
 The Trustee may fix a record date and payment date for any payment to
Securityholders pursuant to this Section. At least 15 days before such record date, the Company shall mail to each Securityholder and the Trustee a notice that states the record date, the payment date and amount to be paid. 
  
 SECTION 6.11 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 Trustee, a court in its discretion may require the filing by any party litigant in the suit of 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 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 principal amount of the Securities. 
  
 SECTION 6.12 Waiver of Stay or Extension Laws. The Company (to the extent it may lawfully do so) shall not at any
time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the 

  

 79 








 
performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law,
and shall not 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 had been enacted. 
  
 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 and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs. 

 
 (b) Except during the continuance of an Event of Default: 
  
 (1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture and no implied covenants or obligations shall be read into this Indenture 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, the Trustee shall examine the certificates and opinions to determine whether or not they conform
to the requirements of this Indenture. 
  
 (c) The Trustee may not
be relieved from liability for its own negligent action, its own negligent failure to act or its own wilful misconduct, except that: 
  
 (1) this paragraph does not limit the effect of paragraphs (b) and (g) of this Section; 
  
 (2) the Trustee shall not be liable for any error of
judgment made in good faith by a Trust 

  

 80 








 
Officer, unless it is proved 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) Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b), (c) and (g) of this Section. 

 
 (e) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Company. 
  
 (f) Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law. 
  
 (g) No provision of this Indenture shall require the Trustee to, and the Trustee may refuse to perform any duty or exercise any right or power which would
require it to, expend or risk its own funds or otherwise incur any financial liability 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 adequate indemnity against such risk or liability is not reasonably assured to it. 
  
 (h) Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section and to the provisions of the TIA. 
  
 SECTION 7.02 Rights of Trustee. (a) The Trustee may rely on 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. 
  
 (b) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate or an Opinion of Counsel. The Trustee shall not be liable for any action it takes or omits to take in good faith in


  

 81 








 
reliance on the Officers’ Certificate or Opinion of Counsel. 
  
 (c) The Trustee may act through agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care. 
  
 (d) The Trustee shall not be liable for any action it takes or omits to take
in good faith which it believes to be authorized or within its rights or powers; provided, however, that the Trustee’s conduct does not constitute wilful misconduct or negligence. 
  
 (e) The Trustee may consult with counsel, and the advice or Opinion of
Counsel with respect to legal matters relating to this Indenture and the Securities shall be full and complete authorization and protection from liability in respect to any action taken, omitted or suffered by it hereunder in good faith and in
reliance thereon. 
  
 (f) The Trustee shall not be charged with
knowledge or be deemed to have notice of any Default or Event of Default unless a Trust Officer has received at the corporate trust office of the Trustee at the address designated in or pursuant to Section 10.02 hereof written notice of any event
which is in fact such a Default or Event of Default and such notice references this Indenture and the Securities. 
  
 (g) The permissive right of the Trustee to take or refrain from taking any actions enumerated in this Indenture shall not be construed as a duty.

  
 (h) 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 to each agent, custodian and other Person employed to act
hereunder. 
  
 SECTION 7.03 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent, Registrar,
co-registrar or co-paying agent may do the same 

  

 82 








 
with like rights. However, the Trustee must comply with Sections 7.10 and 7.11. 
  
 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 Securities, it shall not be accountable for the Company’s use of the proceeds from the Securities, and it shall not be responsible for any statement of the Company in the Indenture or in any
document issued in connection with the sale of the Securities or in the Securities other than the Trustee’s 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
Securityholder notice of the Default within 90 days after it occurs. Except in the case of a Default in payment of principal of or interest on any Security, the Trustee may withhold the notice if and so long as a committee of its Trust Officers in
good faith determines that withholding the notice is not opposed to the interests of Securityholders. 
  
 SECTION 7.06 Reports by Trustee to Holders. As promptly as practicable after each October 1 beginning with the October 1 following the date of this
Indenture, and in any event prior to December 1 in each year, the Trustee shall mail to each Securityholder a brief report dated as of October 1 that complies with TIA § 313(a). The Trustee also shall comply with TIA § 313(b). 

 
 A copy of each report at the time of its mailing to Securityholders shall
be filed with the SEC and each stock exchange (if any) on which the Securities are listed. The Company agrees to notify promptly the Trustee whenever the Securities become listed on any stock exchange and of any delisting thereof. 
  
 SECTION 7.07 Compensation and Indemnity. The Company shall pay to the
Trustee from time to time reasonable compensation for its services. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee upon request for all
reasonable out-of-pocket expenses incurred or made by it, including costs of collection, in addition to the compensation for its services. Such expenses shall include the reasonable compensation and expenses, disbursements and advances of 

  

 83 








 
the Trustee’s agents, counsel, accountants and experts. The Company shall indemnify the Trustee and its directors, officers, employees and agents
against any and all loss, liability or expense (including attorneys’ fees and expenses) incurred by it or them in connection with the acceptance or administration of this trust and the performance of its duties related hereto, including the
costs and expenses of defending itself against or investigating any claim and/or liability in connection with the exercise or performance of any of its powers or duties hereunder, including the enforcement of this provision. The Trustee shall notify
the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company shall not be required to pay for any settlement made without
the Company’s consent, which consent shall not be unreasonably withheld. The Company need not reimburse any expense or indemnify against any loss, liability or expense incurred by the Trustee through the Trustee’s own wilful misconduct,
gross negligence or bad faith. 
  
 To secure the Company’s
payment obligations in this Section, the Trustee shall have a lien prior to the Securities on all money or property held or collected by the Trustee other than money or property held in trust to pay principal of and interest on particular
Securities. 
  
 The provisions of this Section shall survive the
satisfaction and discharge of this Indenture, the resignation and removal of the Trustee and the termination of this Indenture for any reason. In addition to and without prejudice to its other rights hereunder, when the Trustee incurs expenses after
the occurrence of an Event of Default specified in Section 6.01(7) or (8) with respect to the Company, the expenses are intended to constitute expenses of administration under the Bankruptcy Law. 
  
 The Trustee will comply with the provisions of TIA §313(b)(2) to the
extent applicable. 
  
 SECTION 7.08 Replacement of Trustee.
The Trustee may resign at any time by so notifying the Company. The Holders of a majority in principal amount of the Securities may remove the Trustee by so notifying the Trustee and may appoint a successor Trustee. The Company shall remove the
Trustee if: 
  
 (1) the Trustee fails to comply
with Section 7.10; 
  

 84 








 (2) the Trustee is adjudged bankrupt or insolvent; 
  
 (3) a receiver or other public officer takes charge of the
Trustee or its property; or 
  
 (4) the Trustee
otherwise becomes incapable of acting. 
  
 If the Trustee resigns,
is removed by the Company or by the Holders of a majority in principal amount of the Securities and such Holders do not reasonably promptly appoint a successor Trustee, or if a vacancy exists in the office of Trustee for any reason (the Trustee in
such event being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor Trustee. 
  
 A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. 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 Securityholders. The retiring
Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 7.07. 
  
 If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee or the Holders of 10% in
principal amount of the Securities may petition any court of competent jurisdiction for the appointment of a successor Trustee. 
  
 If the Trustee fails to comply with Section 7.10, any Securityholder may petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee. 
  
 Notwithstanding the
resignation, removal or replacement of the Trustee pursuant to this Section, the Company’s obligations under Section 7.07 shall continue for the benefit of the retiring Trustee. 
  

 85 








 SECTION 7.09 Successor Trustee by Merger. If the Trustee consolidates with, merges or converts
into, or transfers all or substantially all its corporate trust business or assets to, another Person or banking association, the resulting, surviving or transferee Person without any further act shall be the successor Trustee. 
  
 In case at the time such successor or successors by merger, conversion or
consolidation to the Trustee shall succeed to the trusts created by this Indenture any of the Securities shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any
predecessor trustee, and deliver such Securities so authenticated; and in case at that time any of the Securities shall not have been authenticated, any successor to the Trustee may authenticate such Securities either in the name of any predecessor
hereunder or in the name of the successor to the Trustee; and in all such cases such certificates shall have the full force which it is anywhere in the Securities or in this Indenture provided that the certificate of the Trustee shall have.

  
 SECTION 7.10 Eligibility; Disqualification. The Trustee
shall at all times satisfy the requirements of TIA § 310(a). The Trustee shall have a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition. The Trustee shall comply with TIA
§ 310(b); provided, however, that there shall be excluded from the operation of TIA § 310(b)(1) any indenture or indentures under which other securities or certificates of interest or participation in other securities of the
Company are outstanding if the requirements for such exclusion set forth in TIA § 310(b)(1) are met. Nothing herein shall prevent the Trustee from filing with the SEC the application referred to in the second to last paragraph of Section 310(b)
of the TIA. 
  
 SECTION 7.11 Preferential Collection of Claims
Against Company. The Trustee shall comply with TIA § 311(a), excluding any creditor relationship listed in TIA § 311(b). A Trustee who has resigned or been removed shall be subject to TIA § 311(a) to the extent indicated.

  

 86 








 Article 8 
  

Discharge of Indenture; Defeasance 
  
 SECTION 8.01 Discharge of Liability on Securities; Defeasance. (a) When (1) the Company delivers to the Trustee all outstanding Securities (other
than Securities replaced pursuant to Section 2.07) for cancellation or (2) all outstanding Securities have become due and payable, whether at maturity or on a redemption date as a result of the mailing of a notice of redemption pursuant to Article 3
hereof and, in the case of clause (2), the Company irrevocably deposits with the Trustee funds sufficient to pay at maturity or upon redemption all outstanding Securities, including interest thereon to maturity or such redemption date (other than
Securities replaced pursuant to Section 2.07), and if in either case the Company pays all other sums payable hereunder by the Company, then this Indenture shall, subject to Section 8.01(c), cease to be of further effect. The Trustee shall
acknowledge satisfaction and discharge of this Indenture on demand of the Company accompanied by an Officers’ Certificate and an Opinion of Counsel and at the cost and expense of the Company. 
  
 (b) Subject to Sections 8.01(c) and 8.02, the Company at any time may
terminate (1) all its obligations under the Securities and this Indenture (“legal defeasance option”) or (2) its obligations under Sections 4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.09, 4.10, 4.11 and 4.12 and the operation of Sections
6.01(4), 6.01(6), 6.01(7), 6.01(8) and 6.01(9) (but, in the case of Sections 6.01(7) and (8), with respect only to Significant Subsidiaries) and the limitations contained in Section 5.01(a)(3) (“covenant defeasance option”). The Company
may exercise its legal defeasance option notwithstanding its prior exercise of its covenant defeasance option. 
  
 If the Company exercises its legal defeasance option, payment of the Securities may not be accelerated because of an Event of Default with respect
thereto. If the Company exercises its covenant defeasance option, payment of the Securities may not be accelerated because of an Event of Default specified in Sections 6.01(4), 6.01(6), 6.01(7), 6.01(8) and 6.01(9) (but, in the case of Sections
6.01(7) and (8), with respect only to Significant Subsidiaries) or because of the failure of the Company to comply with Section 5.01(a)(3). 
  

 87 








 Upon satisfaction of the conditions set forth herein and upon request of the Company, the Trustee shall
acknowledge in writing the discharge of those obligations that the Company terminates. 
  
 (b) Notwithstanding clauses (a) and (b) above, the Company’s obligations in Sections 2.03, 2.04, 2.05, 2.06, 2.07, 2.08, 7.07 and 7.08 and in this Article 8 shall survive until the Securities have been paid in
full. Thereafter, the Company’s obligations in Sections 7.07, 8.04 and 8.05 shall survive. 
  
 SECTION 8.02 Conditions to Defeasance. The Company may exercise its legal defeasance option or its covenant defeasance option only if: 

 
 (1) the Company irrevocably deposits in trust with the
Trustee money or U.S. Government Obligations for the payment of principal of and interest on the Securities to maturity or redemption, as the case may be; 
  
 (2) the Company delivers to the Trustee a certificate from a nationally recognized firm of independent accountants expressing their
opinion that the payments of principal and interest when due and without reinvestment on the deposited U.S. Government Obligations plus any deposited money without investment will provide cash at such times and in such amounts as will be sufficient
to pay principal and interest when due on all the Securities to maturity or redemption, as the case may be; 
  
 (3) 123 days pass after the deposit is made and during the 123-day period no Default specified in Sections 6.01(7) or (8) with respect to
the Company occurs which is continuing at the end of the period; 
  
 (4) the deposit does not constitute a default under any other agreement binding on the Company; 
  
 (5) the Company delivers to the Trustee an Opinion of Counsel to the effect that the trust resulting from the deposit does not constitute,
or is qualified as, a regulated investment company under the Investment Company Act of 1940; 
  

 88 








 (6) in the case of the legal defeasance option, the Company shall have delivered to the
Trustee an Opinion of Counsel stating that (A) the Company has received from, or there has been published by, the Internal Revenue Service a ruling, or (B) since the date of this Indenture there has been a change in the applicable Federal income tax
law, in either case to the effect that, and based thereon such Opinion of Counsel shall confirm that, the Securityholders will not recognize income, gain or loss for Federal income tax purposes as a result of such defeasance and will be subject to
Federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such defeasance had not occurred; 
  
 (7) in the case of the covenant defeasance option, the Company shall have delivered to the Trustee an Opinion of Counsel to the effect
that the Securityholders will not recognize income, gain or loss for Federal income tax purposes as a result of such covenant defeasance and will be subject to Federal 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; and 
  
 (8) the Company delivers to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent to the defeasance and discharge of the Securities as contemplated by this
Article 8 have been complied with. 
  
 Before or after a deposit,
the Company may make arrangements satisfactory to the Trustee for the redemption of Securities at a future date in accordance with Article 3. 
  
 SECTION 8.03 Application of Trust Money. The Trustee shall hold in trust money or U.S. Government Obligations deposited with it pursuant to this
Article 8. It shall apply the deposited money and the money from U.S. Government Obligations through the Paying Agent and in accordance with this Indenture to the payment of principal of and interest on the Securities. 
  
 SECTION 8.04 Repayment to Company. Subject to any applicable abandoned
property laws, the Trustee and the Paying Agent shall promptly turn over to the Company upon 

  

 89 








 
request any excess money or securities held by them at any time. 
  
 Subject to any applicable abandoned property law, the Trustee and the Paying Agent shall pay to the Company upon request any money held by them for the
payment of principal or interest that remains unclaimed for two years, and, thereafter, Securityholders entitled to the money must look to the Company for payment as general creditors. 
  
 SECTION 8.05 Indemnity for Government Obligations. The Company shall pay and shall indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against deposited U.S. Government Obligations or the principal and interest received on such U.S. Government Obligations. 
  
 SECTION 8.06 Reinstatement. If the Trustee or Paying Agent is unable to apply any money or U.S. Government
Obligations in accordance with this Article 8 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 Company’s
obligations under this Indenture and the Securities shall be revived and reinstated as though no deposit had occurred pursuant to this Article 8 until such time as the Trustee or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with this Article 8; provided, however, that, if the Company has made any payment of interest on or principal of any Securities because of the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Securities to receive such payment from the money or U.S. Government Obligations held by the Trustee or Paying Agent. 
  
 Article 9 
  
 Amendments 
  
 SECTION 9.01 Without Consent of Holders. The Company and the Trustee may amend this Indenture or the Securities without notice to or consent of any Securityholder: 
  
 (1) to cure any ambiguity, omission, defect or inconsistency; 
  

 90 








 (2) to comply with Article 5; 
  
 (3) to provide for uncertificated Securities in addition to
or in place of certificated Securities; provided, however, that the uncertificated Securities are issued in registered form for purposes of Section 163(f) of the Code or in a manner such that the uncertificated Securities are described
in Section 163(f)(2)(B) of the Code; 
  
 (4) to
add Guarantees with respect to the Securities or to secure the Securities; 
  
 (5) to add to the covenants of the Company for the benefit of the Holders or to surrender any right or power herein conferred upon the Company; 
  
 (6) to comply with any requirements of the SEC in connection with qualifying, or maintaining the
qualification of, this Indenture under the TIA; or 
  
 (7) to make any change that does not adversely affect the rights of any Securityholder. 
  
 (8) to make any amendment to the provisions of this Indenture relating to the form, authentication, transfer and legending of Securities;
provided, however, that (a) compliance with this Indenture as so amended would not result in Securities being transferred in violation of the Securities Act or any other applicable securities law and (b) such amendment does not
materially affect the rights of Holders to transfer Securities. 
  
 After an amendment under this Section becomes effective, the Company shall mail to Securityholders a notice briefly describing such amendment. The failure to give such notice to all Securityholders, or any defect therein, shall not impair
or affect the validity of an amendment under this Section. 
  
 SECTION 9.02 With Consent of Holders. The Company and the Trustee may amend this Indenture or the Securities without notice to any Securityholder but with the written consent of the Holders of at least a majority in principal amount
of the Securities then outstanding (including consents obtained in connection with a tender offer or exchange for the Securities). However, without 

  

 91 








 
the consent of each Securityholder affected thereby, an amendment or waiver may not: 
  
 (1) reduce the amount of Securities whose Holders must consent to an amendment; 
  
 (2) reduce the rate of or extend the time for payment of
interest on any Security; 
  
 (3) reduce the
principal of or change the Stated Maturity of any Security; 
  
 (4) change the provisions applicable to the redemption of any Security contained in Article 3 hereof or paragraph 5 of the Securities; 
  
 (5) make any Security payable in money other than that stated in the Security; 
  
 (6) impair the right of any Holder of the Securities to
receive payment of principal of and interest on such Holder’s Securities 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 Securities; 
  
 (7) make any change in the ranking or priority of any
Security that would adversely affect the Securityholders; or 
  
 (8) make any change in Section 6.04 or 6.07 or the second sentence of this Section. 
  
 It shall not be necessary for the consent of the Holders under this Section to approve the particular form of any proposed amendment, but it shall be
sufficient if such consent approves the substance thereof. 
  
 After an amendment under this Section becomes effective, the Company shall mail to Securityholders a notice briefly describing such amendment. The failure to give such notice to all Securityholders, or any defect therein, shall not impair
or affect the validity of an amendment under this Section. 
  
 SECTION 9.03 Compliance with Trust Indenture Act. Every amendment to this Indenture or the Securities shall comply with the TIA as then in effect. 
  

 92 








 SECTION 9.04 Revocation and Effect of Consents and Waivers. A consent to an amendment or a waiver
by a Holder of a Security shall bind the Holder and every subsequent Holder of that Security or portion of the Security that evidences the same debt as the consenting Holder’s Security, even if notation of the consent or waiver is not made on
the Security. However, any such Holder or subsequent Holder may revoke the consent or waiver as to such Holder’s Security or portion of the Security if the Trustee receives the notice of revocation before the date the amendment or waiver
becomes effective. After an amendment or waiver becomes effective, it shall bind every Securityholder. An amendment or waiver becomes effective upon the execution of such amendment or waiver by the Trustee. 
  
 The Company shall be entitled to, but shall not be obligated to, fix a record
date for the purpose of determining the Securityholders entitled to give their consent or take any other action described above or required or permitted to be taken pursuant to this Indenture. If a record date is fixed, then notwithstanding the
immediately preceding paragraph, those Persons who were Securityholders at such record date (or their duly designated proxies), and only those Persons, shall be entitled to give such consent or to revoke any consent previously given or to take any
such action, whether or not such Persons continue to be Holders after such record date. No such consent shall be valid or effective for more than 120 days after such record date. 
  
 SECTION 9.05 Notation on or Exchange of Securities. If an amendment changes the terms of a Security, the Trustee
shall be entitled to require the Holder of the Security to deliver it to the Trustee. The Trustee shall be entitled to place an appropriate notation on the Security regarding the changed terms and return it to the Holder. Alternatively, if the
Company or the Trustee so determines, the Company in exchange for the Security shall issue and the Trustee shall authenticate a new Security that reflects the changed terms. Failure to make the appropriate notation or to issue a new Security shall
not affect the validity of such amendment. 
  
 SECTION 9.06
Trustee To Sign Amendments. The Trustee shall sign any amendment authorized pursuant to this Article 9 if, in the Trustee’s sole discretion, the amendment does not adversely affect the rights, duties, 

  

 93 








 
liabilities or immunities of the Trustee. If it does, the Trustee shall be entitled to, but need not, sign it. In signing such amendment the Trustee shall be
entitled to receive indemnity reasonably satisfactory to it and to receive, and (subject to Section 7.01) shall be fully protected in relying upon, an Officers’ Certificate and an Opinion of Counsel stating that such amendment is authorized or
permitted by this Indenture. 
  
 SECTION 9.07 Payment for
Consent. Neither the Company nor any Affiliate of the Company shall, directly or indirectly, pay or cause to be paid any consideration, whether by way of interest, fee 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 Securities unless such consideration is offered to be paid to all Holders that so consent, waive or agree to amend in the time frame set forth in solicitation documents relating to
such consent, waiver or agreement. 
  
 Article 10

  
  
 Miscellaneous 
  
 SECTION
10.01 Trust Indenture Act Controls. If any provision of this Indenture limits, qualifies or conflicts with another provision which is required to be included in this Indenture by the TIA, the required provision shall control. 
  

 94 








 SECTION 10.02 Notices. Any notice or communication shall be in writing and delivered in person or
mailed by first-class mail addressed as follows: 
  
 if to the
Company: 
  
 WMC Finance Co. 
 6320 Canoga Avenue 
 Woodland Hills,
California 91367 
  
 Attention: General Counsel 
  
 if to the Trustee: 
  
 JPMorgan Chase Bank 
 4 New York Plaza 
 15th Floor 
 New York, New York 10004 
  
 Attention: Institutional Trust Services 
  
 The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications. 
  
 Any notice or communication mailed to a Securityholder shall be mailed to the
Securityholder at the Securityholder’s address as it appears on the registration books of the Registrar and shall be sufficiently given if so mailed within the time prescribed. 
  
 Failure to mail a notice or communication to a Securityholder or any defect in it shall not affect its sufficiency with
respect to other Securityholders. If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it; provided, however, that in the case of the Trustee, such notice or
communication must actually be received by the Trustee at the address designated above or pursuant to this Section in order to be effective. 
  
 SECTION 10.03 Communication by Holders with Other Holders. Securityholders may communicate pursuant to TIA § 312(b) with other Securityholders
with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Registrar and anyone else shall have the protection of TIA § 312(c). 
  
 SECTION 10.04 Certificate and Opinion as to Conditions Precedent. Upon any request or application by the Company to
the Trustee to take or refrain from taking 

  

 95 








 
any action under this Indenture, the Company shall furnish to the Trustee: 
  
 (1) an Officers’ Certificate in form and substance reasonably satisfactory to the Trustee stating that,
in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and 
  
 (2) an Opinion of Counsel in form and substance reasonably satisfactory to the Trustee stating that, in the opinion of such counsel, all
such conditions precedent have been complied with. 
  
 SECTION
10.05 Statements Required in Certificate or Opinion. Each certificate or opinion with respect to compliance with a covenant or condition provided for in this Indenture shall include: 
  
 (1) a statement that the individual 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 individual, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and 
  
 (4) a statement as to whether or not, in the opinion of such individual, such covenant or condition has been complied with. 
  
 SECTION 10.06 When Securities Disregarded. In determining whether the
Holders of the required principal amount of Securities have concurred in any direction, waiver or consent, Securities owned by the Company or by any Person directly or indirectly controlling or controlled by or under direct or indirect common
control with the Company shall be disregarded and deemed not to be outstanding, except that, for the purpose of determining whether the Trustee shall be protected in relying on any 

  

 96 








 
such direction, waiver or consent, only Securities which a Trust Officer actually knows are so owned shall be so disregarded. Also, subject to the foregoing,
only Securities outstanding at the time shall be considered in any such determination. 
  
 SECTION 10.07 Rules by Trustee, Paying Agent and Registrar. The Trustee may make reasonable rules for action by or a meeting of Securityholders. The Registrar and the Paying Agent may make reasonable rules for
their functions. 
  
 SECTION 10.08 Legal Holidays. If a
payment date is a Legal Holiday, payment shall be made on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period. If a regular record date is a Legal Holiday, the record date shall not be
affected. 
  
 SECTION 10.09 Governing Law. This Indenture
and the Securities shall be governed by, and construed in accordance with, the laws of the State of New York. 
  
 SECTION 10.10 No Recourse Against Others. A director, officer, employee or stockholder, as such, of the Company shall not have any liability for
any obligations of the Company under the Securities or this Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. By accepting a Security, each Securityholder shall waive and release all such
liability. The waiver and release shall be part of the consideration for the issue of the Securities. 
  
 SECTION 10.11 Successors. All agreements of the Company in this Indenture and the Securities shall bind its successors. All agreements of the
Trustee in this Indenture shall bind its successors as Trustee. 
  
 SECTION 10.12 Multiple 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. One signed copy is enough to prove this
Indenture. 
  
 SECTION 10.13 Table of Contents; Headings.
The table of contents, cross-reference sheet and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of
the terms or provisions hereof. 
  

 97 








 IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first
written above. 
  

			
	 WMC FINANCE CO.

		
	 By
	 	 /s/    DAVID
TRZCINSKI        


	 Name:
 Title:
	 	 David Trzcinski
 Executive Vice President,
 Chief Financial Officer and Treasurer



  

			
	 JPMORGAN CHASE BANK,
as Trustee

		
	 By
	 	 /s/    DIANE
WELSH        


	 Name:
 Title:
	 	 Diane Welsh
 Vice President



  

 98 








 RULE 144A/REGULATION S/IAI APPENDIX 
  
 PROVISIONS RELATING TO INITIAL SECURITIES, 
 PRIVATE EXCHANGE SECURITIES 
 AND EXCHANGE SECURITIES

  

	1.	Definitions 

  
 1.1 Definitions 
  
 For
the purposes of this Appendix the following terms shall have the meanings indicated below: 
  
 “Applicable Procedures” means, with respect to any transfer or transaction involving a Temporary Regulation S Global Security or
beneficial interest therein, the rules and procedures of the Depository for such a Temporary Regulation S Global Security, to the extent applicable to such transaction and as in effect from time to time. 
  
 “Definitive Security” means a certificated Initial
Security or Exchange Security or Private Exchange Security bearing, if required, the appropriate restricted securities legend set forth in Section 2.3(e). 
  
 “Depository” means The Depository Trust Company, its nominees and their respective successors. 
  
 “Distribution Compliance Period”, with respect to
any Securities, means the period of 40 consecutive days beginning on and including the later of (i) the day on which such Securities are first offered to Persons other than distributors (as defined in Regulation S under the Securities Act) in
reliance on Regulation S and (ii) the issue date with respect to such Securities. 
  
 “Exchange Offer Registration Statement” means the registration statement issued by the Company in connection with a Registered
Exchange Offer. 
  
 “Exchange
Securities” means (1) the 113⁄4% Senior Notes due 2008 issued pursuant to the Indenture in connection with a Registered Exchange Offer pursuant to a Registration Rights Agreement and (2) Additional Securities, if any, offered and sold by the
Company pursuant to a registration statement filed with the Commission under the Securities Act. 
  









 “IAI” means an institutional “accredited investor,” as defined in
Rule 501(a) (1), (2), (3) or (7) of Regulation D under the Securities Act. 
  
 “Initial Purchasers” means (1) with respect to the Initial Securities issued on the Issue Date, Credit Suisse First Boston LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Lehman Brothers Inc.
and (2) with respect to each issuance of Additional Securities, the Persons purchasing or underwriting such Additional Securities under the related Purchase Agreement. 
  
 “Initial Securities” means (1) $200,000,000 aggregate principal amount of 113⁄4% Senior Notes
due 2008 issued on the Issue Date and (2) Additional Securities, if any, offered and sold by the Company in a transaction exempt from the registration requirements of the Securities Act. 
  
 “Private Exchange” means the offer by the Company,
pursuant to a Registration Rights Agreement, to the Initial Purchasers to issue and deliver to each such Initial Purchaser, in exchange for the Initial Securities held by such Initial Purchaser as part of the initial distribution of such Initial
Securities, a like aggregate principal amount of Private Exchange Securities. 
  
 “Private Exchange Securities” means any 113⁄4% Senior Notes due 2008 issued in connection with a Private Exchange. 
  

“Purchase Agreement” means (1) with respect to the Initial Securities issued on the Issue Date, the Purchase Agreement dated
December 11, 2003, among the Company and the Initial Purchasers and (2) with respect to each issuance of Additional Securities, the purchase agreement or underwriting agreement among the Company and the Persons purchasing or underwriting such
Additional Securities. 
  
 “QIB” means
a “qualified institutional buyer” as defined in Rule 144A. 
  
 “Registered Exchange Offer” means the offer by the Company, pursuant to a Registration Rights Agreement, to certain Holders of Initial Securities, to issue and deliver to such Holders, in exchange for the
Initial 

  

 2 








 
Securities, a like aggregate principal amount of Exchange Securities registered under the Securities Act. 
  
 “Registration Rights Agreement” means (1) with
respect to the Initial Securities issued on the Issue Date, the Registration Rights Agreement dated December 11, 2003, among the Company and the Initial Purchasers and (2) with respect to each issuance of Additional Securities issued in a
transaction exempt from the registration requirements of the Securities Act, the registration rights agreement, if any, among the Company and the Persons purchasing such Additional Securities under the related Purchase Agreement. 
  
 “Rule 144A Securities” means all Securities
offered and sold to QIBs in reliance on Rule 144A. 
  
 “Securities” means the Initial Securities, the Exchange Securities and the Private Exchange Securities, treated as a single class under the Indenture. 
  
 “Securities Act” means the Securities Act of 1933. 
  
 “Securities Custodian” means the custodian with
respect to a Global Security (as appointed by the Depository), or any successor Person thereto, and shall initially be the Trustee. 
  
 “Shelf Registration Statement” means the registration statement issued by the Company in connection with the offer and sale of
Initial Securities or Private Exchange Securities pursuant to a Registration Rights Agreement. 
  
 “Transfer Restricted Securities” means Securities that bear or are required to bear a legend relating to restrictions on
transfer relating to the Securities Act set forth in Section 2.3(e). 
  

 3 








 1.2 Other Definitions 
  

				
	 Term

	  	 Defined in
 Section:

	 
	 Agent Members
	  	2.1	(b)
	 Global Securities
	  	2.1	(a)
	 IAI Global Security
	  	2.1	(a)
	 Permanent Regulation S Global Security
	  	2.1	(a)
	 Regulation S
	  	2.1	(a)
	 Regulation S Global Security
	  	2.1	(a)
	 Rule 144A
	  	2.1	(a)
	 Rule 144A Global Security
	  	2.1	(a)
	 Temporary Regulation S Global Security
	  	2.1	(a)

  

	2.	The Securities 

  
 2.1 (a) Form and Dating. The Initial Securities will be offered and sold by the Company pursuant to a Purchase Agreement. The Initial Securities
will be resold initially only to (i) QIBs in reliance on Rule 144A under the Securities Act (“Rule 144A”) and (ii) Persons other than U.S. Persons (as defined in Regulation S) in reliance on Regulation S under the Securities Act
(“Regulation S”). Initial Securities may thereafter be transferred to, among others, QIBs, IAIs and purchasers in reliance on Regulation S, subject to the restrictions on transfer set forth herein. Initial Securities initially resold
pursuant to Rule 144A shall be issued initially in the form of one or more permanent global Securities in definitive, fully registered form (collectively, the “Rule 144A Global Security”); Initial Securities initially resold to IAIs shall
be issued initially in the form of one or more permanent global Securities in definitive, fully registered form (collectively, the “IAI Global Security”); and Initial Securities initially resold pursuant to Regulation S shall be issued
initially in the form of one or more temporary global securities in fully registered form (collectively, the “Temporary Regulation S Global Security”), in each case without interest coupons and with the global securities legend and the
applicable restricted securities legend set forth in Exhibit 1 hereto, which shall be deposited on behalf of the purchasers of the Initial Securities represented thereby with the Securities Custodian and registered in the name of the Depository or a
nominee of the Depository, duly executed by the Company and authenticated by the Trustee as provided in this Indenture. 

  

 4 








 
Except as set forth in this Section 2.1(a), beneficial ownership interests in the Temporary Regulation S Global Security will not be exchangeable for
interests in the Rule 144A Global Security, the IAI Global Security, a permanent global security (the “Permanent Regulation S Global Security”, and together with the Temporary Regulation S Global Security, the “Regulation S Global
Security”) or any other Security prior to the expiration of the Distribution Compliance Period and then, after the expiration of the Distribution Compliance Period, may be exchanged for interests in a Rule 144A Global Security, an IAI Global
Security or the Permanent Regulation S Global Security only upon certification in form reasonably satisfactory to the Trustee that (i) beneficial ownership interests in such Temporary Regulation S Global Security are owned by or being transferred to
either non-U.S. persons or U.S. persons who purchased such interests in a transaction that did not require registration under the Securities Act and (ii) in the case of an exchange for an IAI Global Security, certification that the interest in the
Temporary Regulation S Global Security is being transferred to an institutional “accredited investor” under the Securities Act that is an institutional accredited investor acquiring the securities for its own account or for the account of
an institutional accredited investor. 
  
 Beneficial interests in Temporary Regulation S Global Securities or IAI Global Securities may be exchanged for interests in Rule 144A Global Securities if (1) such exchange occurs in connection with a transfer of Securities in compliance
with Rule 144A and (2) the transferor of the beneficial interest in the Temporary Regulation S Global Security or the IAI Global Security, as applicable, first delivers to the Trustee a written certificate (in a form satisfactory to the Trustee) to
the effect that the beneficial interest in the Temporary Regulation S Global Security or the IAI Global Security, as applicable, is being transferred to a Person (a) who the transferor reasonably believes to be a QIB, (b) purchasing for its own
account or the account of a QIB in a transaction meeting the requirements of Rule 144A, and (c) in accordance with all applicable securities laws of the States of the United States and other jurisdictions. 
  
 Beneficial interests in Temporary Regulation S Global
Securities and Rule 144A Global Securities may be exchanged for an interest in IAI Global Securities if 

  

 5 








 
(1) such exchange occurs in connection with a transfer of the securities in compliance with an exemption under the Securities Act and (2) the transferor of
the Regulation S Global Security or Rule 144A Global Security, as applicable, first delivers to the trustee a written certificate (substantially in the form of Exhibit 2) to the effect that (A) the Regulation S Global Security or Rule 144A Global
Security, as applicable, is being transferred (a) to an “accredited investor” within the meaning of 501(a) (1), (2), (3) or (7) under the Securities Act that is an institutional accredited investor acquiring the securities for its own
account or for the account of such an institutional accredited investor, in each case in a minimum principal amount of 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 and (B) in accordance with all applicable securities laws of the States of the United States and other jurisdictions. 
  
 Beneficial interests in a Rule 144A Global Security or an IAI Global Security may be transferred to a Person who takes delivery in the
form of an interest in a Regulation S Global Security, whether before or after the expiration of the Distribution Compliance Period, only if the transferor first delivers to the Trustee a written certificate (in the form provided in the Indenture)
to the effect that such transfer is being made in accordance with Rule 903 or 904 of Regulation S or Rule 144 (if applicable). 
  
 The Rule 144A Global Security, the IAI Global Security, the Temporary Regulation S Global Security and the Permanent Regulation S Global
Security are collectively referred to herein as “Global Securities”. The aggregate principal amount of the Global Securities may from time to time be increased or decreased by adjustments made on the records of the Trustee and the
Depository or its nominee as hereinafter provided. 
  
 (b) Book-Entry Provisions. This Section 2.1(b) shall apply only to a Global Security deposited with or on behalf of the Depository. 
  
 The Company shall execute and the Trustee shall, in accordance with this Section 2.1(b), authenticate and deliver initially one or more
Global Securities that (a) shall be registered in the name of the Depository for 

  

 6 








 
such Global Security or Global Securities or the nominee of such Depository and (b) shall be delivered by the Trustee to such Depository or pursuant to such
Depository’s instructions or held by the Trustee as custodian for the Depository. 
  
 Members of, or participants in, the Depository (“Agent Members”) shall have no rights under this Indenture with respect to any
Global Security held on their behalf by the Depository or by the Trustee as the custodian of the Depository or under such Global Security, and the Company, the Trustee and any agent of the Company or the Trustee shall be entitled to treat the
Depository as the absolute owner of such Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the Depository or impair, as between the Depository and its Agent Members, the operation of customary practices of such Depository governing the exercise of the rights of a holder of a
beneficial interest in any Global Security. 
  
 (c) Definitive Securities. Except as provided in this Section 2.1 or Section 2.3 or 2.4, owners of beneficial interests in Global Securities shall not be entitled to receive physical delivery of Definitive Securities. 
  
 2.2 Authentication. The Trustee shall authenticate and deliver: (1) on
the Issue Date, an aggregate principal amount of $200 million 113⁄4% Senior Notes due 2008, (2) any Additional Securities for an original issue in an aggregate principal amount specified in the written order of the Company pursuant to Section
2.02 of the Indenture and (3) Exchange Securities or Private Exchange Securities for issue only in a Registered Exchange Offer or a Private Exchange, respectively, pursuant to a Registration Rights Agreement, for a like principal amount of Initial
Securities, in each case upon a written order of the Company signed by two Officers or by an Officer and either an Assistant Treasurer or an Assistant Secretary of the Company. Such order shall specify the amount of the Securities to be
authenticated and the date on which the original issue of Securities is to be authenticated and, in the case of any issuance of Additional Securities pursuant to Section 2.13 of the Indenture, shall certify that such 

  

 7 








 
issuance is in compliance with Section 4.03 of the Indenture. 
  
 2.3 Transfer and Exchange. 
  
 (a) Transfer and Exchange of Definitive Securities. When Definitive Securities are presented to the Registrar with a request:

  

	 	(x)	to register the transfer of such Definitive Securities; or 

  

	 	(y)	to exchange such Definitive Securities for an equal principal amount of Definitive Securities 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 Securities surrendered for transfer or exchange: 
  
 (i) shall be duly endorsed or accompanied by a written instrument of transfer in form reasonably satisfactory to the Company and the
Registrar, duly executed by the Holder thereof or its attorney duly authorized in writing; and 
  
 (ii) if such Definitive Securities are required to bear a restricted securities legend, they are being transferred or exchanged pursuant
to an effective registration statement under the Securities Act, pursuant to Section 2.3(b) or pursuant to clause (A), (B) or (C) below, and are accompanied by the following additional information and documents, as applicable: 
  
 (A) if such Definitive Securities 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; or 
  
 (B) if such Definitive Securities are being transferred to the Company, a certification to that effect; or 
  
 (C) if such Definitive Securities are being transferred (x)
pursuant to an exemption from 

  

 8 








 
registration in accordance with Rule 144A, Regulation S or Rule 144 under the Securities Act; or (y) in reliance upon another exemption from the requirements
of the Securities Act: (i) a certification to that effect (in the form set forth on the reverse of the Security) and (ii) if the Company so requests, an opinion of counsel or other evidence reasonably satisfactory to it as to the compliance with the
restrictions set forth in the legend set forth in Section 2.3(e)(i). 
  
 (b) Restrictions on Transfer of a Definitive Security for a Beneficial Interest in a Global Security. A Definitive Security may not be exchanged for a beneficial interest in a Rule 144A Global Security, an IAI
Global Security or a Permanent Regulation S Global Security except upon satisfaction of the requirements set forth below. Upon receipt by the Trustee of a Definitive Security, duly endorsed or accompanied by appropriate instruments of transfer, in
form satisfactory to the Trustee, together with: 
  
 (i) certification, in the form set forth on the reverse of the Security, that such Definitive Security is either (A) being transferred to a QIB in accordance with Rule 144A, (B) being transferred to an IAI or (C) being transferred after
expiration of the Distribution Compliance Period by a Person who initially purchased such Security in reliance on Regulation S to a buyer who elects to hold its interest in such Security in the form of a beneficial interest in the Permanent
Regulation S Global Security; and 
  
 (ii)
written instructions directing the Trustee to make, or to direct the Securities Custodian to make, an adjustment on its books and records with respect to such Rule 144A Global Security (in the case of a transfer pursuant to clause (b)(i)(A)), IAI
Global Security (in the case of a transfer pursuant to clause (b)(1)(B)) or Permanent Regulation S Global Security (in the case of a transfer pursuant to clause (b)(i)(C)) to reflect an increase in the aggregate principal amount of the Securities
represented by the Rule 144A Global Security, IAI Global Security or Permanent Regulation S Global Security, as applicable, such instructions to contain information regarding the Depository account to be credited with such increase, 

  

 9 








 
then the Trustee shall cancel such Definitive Security and cause, or direct the Securities Custodian to cause, in accordance with the standing instructions
and procedures existing between the Depository and the Securities Custodian, the aggregate principal amount of Securities represented by the Rule 144A Global Security, IAI Global Security or Permanent Regulation S Global Security, as applicable, to
be increased by the aggregate principal amount of the Definitive Security 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 Rule 144A Global Security,
IAI Global Security or Permanent Regulation S Global Security, as applicable, equal to the principal amount of the Definitive Security so canceled. If no Rule 144A Global Securities, IAI Global Securities or Permanent Regulation S Global Securities,
as applicable, are then outstanding, the Company shall issue and the Trustee shall authenticate, upon written order of the Company in the form of an Officers’ Certificate of the Company, a new Rule 144A Global Security, IAI Global Security or
Permanent Regulation S Global Security, as applicable, in the appropriate principal amount. 
  
 (c) Transfer and Exchange of Global Securities. 
  
 (i) The transfer and exchange of Global Securities or beneficial interests therein shall be effected through
the Depository, in accordance with this Indenture (including applicable restrictions on transfer set forth herein, if any) and the procedures of the Depository therefor. A transferor of a beneficial interest in a Global Security shall deliver to the
Registrar a written order given in accordance with the Depository’s procedures containing information regarding the participant account of the Depository to be credited with a beneficial interest in the Global Security. The Registrar shall, in
accordance with such instructions, instruct the Depository to credit to the account of the Person specified in such instructions a beneficial interest in the Global Security and to debit the account of the Person making the transfer the beneficial
interest in the Global Security being transferred. 
  
 (ii) If the proposed transfer is a transfer of a beneficial interest in one Global Security to a beneficial interest in another Global Security, the Registrar shall reflect on its books and records the 

  

 10 








 
date and an increase in the principal amount of the Global Security 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 the Global Security from which such interest is being transferred. 
  
 (iii) Notwithstanding any other provisions of this Appendix
(other than the provisions set forth in Section 2.4), a Global Security may not be transferred as a whole except by the Depository to a nominee of the Depository or by a nominee of the Depository to the Depository or another nominee of the
Depository or by the Depository or any such nominee to a successor Depository or a nominee of such successor Depository. 
  
 (iv) In the event that a Global Security is exchanged for Definitive Securities pursuant to Section 2.4 of this Appendix, prior to the
consummation of a Registered Exchange Offer or the effectiveness of a Shelf Registration Statement with respect to such Securities, such Securities may be exchanged only in accordance with such procedures as are substantially consistent with the
provisions of this Section 2.3 (including the certification requirements set forth on the reverse of the Securities intended to ensure that such transfers comply with Rule 144A, Regulation S or another applicable exemption under the Securities Act,
as the case may be) and such other procedures as may from time to time be adopted by the Company. 
  
 (d) Restrictions on Transfer of Temporary Regulation S Global Securities. During the Distribution Compliance Period, beneficial
ownership interests in Temporary Regulation S Global Securities may only be sold, pledged or transferred in accordance with the Applicable Procedures and only (i) to the Company, (ii) in an offshore transaction in accordance with Regulation S (other
than a transaction resulting in an exchange for an interest in a Permanent Regulation S Global Security) or (iii) 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. 
  

 11 








 (e) Legend. 
  
 (i) Except as permitted by the following paragraphs (ii), (iii) and (iv), each Security certificate
evidencing the Global Securities (and all Securities issued in exchange therefor or in substitution thereof), in the case of Securities offered otherwise than in reliance on Regulation S, shall bear a legend in substantially the following form:

  
 THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. 

 
 THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) TO THE COMPANY, (II) IN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (III) 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 SECURITIES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF 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, (IV) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (V) PURSUANT TO EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF 

  

 12 








 
AVAILABLE) OR (VI) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (VI), IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE. 
  
 Each certificate evidencing a Security offered in reliance
on Regulation S shall bear a legend in substantially the following form: 
  
 THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION ORIGINALLY EXEMPT FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT BE
TRANSFERRED IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON EXCEPT PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ALL APPLICABLE STATE SECURITIES LAWS. TERMS USED ABOVE
HAVE THE MEANINGS GIVEN TO THEM IN REGULATION S UNDER THE SECURITIES ACT. 
  
 Each Definitive Security shall also bear the following additional 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. 
  
 (ii) Upon any sale or transfer of a Transfer Restricted Security (including any Transfer Restricted Security represented by a Global
Security) pursuant to Rule 144 under the Securities Act, the Registrar shall permit the transferee thereof to exchange such Transfer Restricted Security for a certificated Security that does not bear the legend set forth above and rescind any
restriction on the transfer of such Transfer Restricted Security, if the transferor thereof certifies in writing to the Registrar that such sale or transfer was made in reliance on Rule 144 (such certification to be in the form set forth on the
reverse of the Security). 
  

 13 








 (iii) After a transfer of any Initial Securities or Private Exchange Securities pursuant
to and during the period of the effectiveness of a Shelf Registration Statement with respect to such Initial Securities or Private Exchange Securities, as the case may be, all requirements pertaining to legends on such Initial Security or such
Private Exchange Security will cease to apply, the requirements requiring any such Initial Security or such Private Exchange Security issued to certain Holders be issued in global form will cease to apply, and a certificated Initial Security or
Private Exchange Security or an Initial Security or Private Exchange Security in global form, in each case without restrictive transfer legends, will be available to the transferee of the Holder of such Initial Securities or Private Exchange
Securities upon exchange of such transferring Holder’s certificated Initial Security or Private Exchange Security or directions to transfer such Holder’s interest in the Global Security, as applicable. 
  
 (iv) Upon the consummation of a Registered Exchange Offer
with respect to the Initial Securities, all requirements pertaining to such Initial Securities that Initial Securities issued to certain Holders be issued in global form will still apply with respect to Holders of such Initial Securities that do not
exchange their Initial Securities, and Exchange Securities in certificated or global form, in each case without the restricted securities legend set forth in Exhibit 1 hereto will be available to Holders that exchange such Initial Securities in such
Registered Exchange Offer. 
  
 (v) Upon the
consummation of a Private Exchange with respect to the Initial Securities, all requirements pertaining to such Initial Securities that Initial Securities issued to certain Holders be issued in global form will still apply with respect to Holders of
such Initial Securities that do not exchange their Initial Securities, and Private Exchange Securities in global form with the global securities legend and the applicable restricted securities legend set forth in Exhibit 1 hereto will be available
to Holders that exchange such Initial Securities in such Private Exchange. 
  

 14 








 (f) Cancellation or Adjustment of Global Security. At such time as all beneficial
interests in a Global Security have either been exchanged for Definitive Securities, redeemed, purchased or canceled, such Global Security shall be returned to the Depository for cancellation or retained and canceled by the Trustee. At any time
prior to such cancellation, if any beneficial interest in a Global Security is exchanged for Definitive Securities, redeemed, purchased or canceled, the principal amount of Securities represented by such Global Security shall be reduced and an
adjustment shall be made on the books and records of the Trustee (if it is then the Securities Custodian for such Global Security) with respect to such Global Security, by the Trustee or the Securities Custodian, to reflect such reduction.

  
 (g) No Obligation of the Trustee.

  
 (i) The Trustee shall have no responsibility
or obligation to any beneficial owner of a Global Security, a member of, or a participant in the Depository or other Person with respect to the accuracy of the records of the Depository or its nominee or of any participant or member thereof, with
respect to any ownership interest in the Securities or with respect to the delivery to any participant, member, beneficial owner or other Person (other than the Depository) of any notice (including any notice of redemption) or the payment of any
amount, under or with respect to such Securities. All notices and communications to be given to the Holders and all payments to be made to Holders under the Securities shall be given or made only to or upon the order of the registered Holders (which
shall be the Depository or its nominee in the case of a Global Security). The rights of beneficial owners in any Global Security shall be exercised only through the Depository subject to the applicable rules and procedures of the Depository. The
Trustee may rely and shall be fully protected in relying upon information furnished by the Depository 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 

  

 15 








 
Security (including any transfers between or among Depository participants, members or beneficial owners in any Global Security) 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 examine the same to determine substantial compliance as to form with
the express requirements hereof. 
  
 2.4 Certificated
Securities. 
  
 (a) A Global Security
deposited with the Depository or with the Trustee as Securities Custodian for the Depository pursuant to Section 2.1 shall be transferred to the beneficial owners thereof in the form of Definitive Securities in an aggregate principal amount equal to
the principal amount of such Global Security, in exchange for such Global Security, only if such transfer complies with Section 2.3 hereof and (i) the Depository notifies the Company that it is unwilling or unable to continue as Depository for such
Global Security and the Depository fails to appoint a successor depositary or if at any time such Depository ceases to be a “clearing agency” registered under the Exchange Act and, in either case, a successor Depository is not appointed by
the Company within 90 days of such notice, or (ii) an Event of Default has occurred and is continuing or (iii) the Company, in its sole discretion, notifies the Trustee in writing that it elects to cause the issuance of Definitive Securities under
this Indenture. 
  
 (b) Any Global Security that
is transferable to the beneficial owners thereof pursuant to this Section 2.4 shall be surrendered by the Depository to the Trustee located at its principal corporate trust office in the Borough of Manhattan, The City of New York, 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 Security, an equal aggregate principal amount of Definitive Securities of
authorized denominations. Any portion of a Global Security transferred pursuant to this Section 2.4 shall be executed, authenticated and delivered only in denominations of $1,000 principal amount and any integral multiple thereof and registered in
such names as the Depository shall direct. Any Definitive Security delivered in exchange for an interest in the Transfer Restricted 

  

 16 








 
Security shall, except as otherwise provided by Section 2.3(e) hereof, bear the applicable restricted securities legend and definitive note legend set forth
in Exhibit 1 hereto. 
  
 (c) Subject to the
provisions of Section 2.4(b) hereof, the registered Holder of a Global Security shall be entitled to 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 Securities. 
  
 (d) In the event of the occurrence of one of the events specified in Section 2.4(a) hereof, the Company shall promptly make available to
the Trustee a reasonable supply of Definitive Securities in definitive, fully registered form without interest coupons. In the event that the Definitive Securities are not issued to each such beneficial owner promptly after the Registrar has
received a request from the Holder of a Global Security to issue such Certificated Security, the Company expressly acknowledges, with respect to the right of any Holder to pursue a remedy pursuant to Article 6 of the Indenture, the right of any
beneficial holder of Securities to pursue such remedy with respect to the portion of the Global Security that represents such beneficial holder’s Securities as if such Certificated Securities had been issued. 
  

 17 








 EXHIBIT 1 
 to 
 RULE 144A/REGULATION S/IAI APPENDIX 
  
 [FORM OF FACE OF INITIAL SECURITY] 
  
 [Global Securities 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 COMPANY 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 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 ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF. 
  
 [[FOR REGULATION S GLOBAL SECURITY ONLY] UNTIL 40 DAYS AFTER THE LATER OF
COMMENCEMENT OR COMPLETION OF THE OFFERING, AN OFFER OR SALE OF SECURITIES WITHIN THE UNITED STATES BY A DEALER (AS DEFINED IN THE SECURITIES ACT) MAY VIOLATE THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT IF SUCH OFFER OR SALE IS MADE
OTHERWISE THAN IN ACCORDANCE WITH RULE 144A THEREUNDER.] 
  
 [Restricted Securities Legend for Securities Offered Otherwise than in Reliance on Regulation S] 
  
 THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS
AMENDED (THE “SECURITIES ACT”), AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE


  









 
SELLER OF THIS SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. 

 
 THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A)
THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) TO THE COMPANY, (II) WITHIN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (III) 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 SECURITIES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF 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, (IV) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (V) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (VI) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (VI) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE. 
  
 [Restricted Securities Legend for Securities Offered in Reliance on Regulation S.] 
  
 THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
ORIGINALLY EXEMPT FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND MAY NOT BE TRANSFERRED IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON EXCEPT PURSUANT TO AN
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ALL APPLICABLE STATE SECURITIES LAWS. TERMS USED ABOVE HAVE THE MEANINGS GIVEN TO THEM IN REGULATION S UNDER THE SECURITIES ACT. 
  
 [Temporary Regulation S Global Security Legend] 
  

 2 








 EXCEPT AS SET FORTH BELOW, BENEFICIAL OWNERSHIP INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY
WILL NOT BE EXCHANGEABLE FOR INTERESTS IN THE PERMANENT REGULATION S GLOBAL SECURITY OR ANY OTHER SECURITY REPRESENTING AN INTEREST IN THE SECURITIES REPRESENTED HEREBY WHICH DO NOT CONTAIN A LEGEND CONTAINING RESTRICTIONS ON TRANSFER, UNTIL THE
EXPIRATION OF THE “40-DAY DISTRIBUTION COMPLIANCE PERIOD” (WITHIN THE MEANING OF RULE 903(b)(2) OF REGULATION S UNDER THE SECURITIES ACT) AND THEN ONLY UPON CERTIFICATION IN FORM REASONABLY SATISFACTORY TO THE TRUSTEE THAT SUCH BENEFICIAL
INTERESTS ARE OWNED EITHER BY NON-U.S. PERSONS OR U.S. PERSONS WHO PURCHASED SUCH INTERESTS IN A TRANSACTION THAT DID NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT. DURING SUCH 40-DAY DISTRIBUTION COMPLIANCE PERIOD, BENEFICIAL OWNERSHIP
INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY MAY ONLY BE SOLD, PLEDGED OR TRANSFERRED (I) TO THE COMPANY, (II) OUTSIDE THE UNITED STATES IN A TRANSACTION IN ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, OR (III)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (III) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. HOLDERS OF INTERESTS IN THIS TEMPORARY REGULATION S
GLOBAL SECURITY WILL NOTIFY ANY PURCHASER OF THIS SECURITY OF THE RESALE RESTRICTIONS REFERRED TO ABOVE, IF THEN APPLICABLE. 
  
 AFTER THE EXPIRATION OF THE DISTRIBUTION COMPLIANCE PERIOD, BENEFICIAL INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY MAY BE EXCHANGED FOR
INTERESTS IN A RULE 144A GLOBAL SECURITY ONLY IF (1) SUCH EXCHANGE OCCURS IN CONNECTION WITH A TRANSFER OF THE SECURITIES IN COMPLIANCE WITH RULE 144A AND (2) THE TRANSFEROR OF THE REGULATION S GLOBAL SECURITY FIRST DELIVERS TO THE TRUSTEE A WRITTEN
CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO THE EFFECT THAT THE REGULATION S GLOBAL SECURITY IS BEING TRANSFERRED (A) TO A PERSON WHO THE TRANSFEROR REASONABLY BELIEVES TO BE A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE
144A, (B) TO A PERSON WHO IS PURCHASING FOR ITS OWN ACCOUNT OR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, AND (C) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER JURISDICTIONS. 
  
 AFTER THE EXPIRATION OF
THE DISTRIBUTION COMPLIANCE PERIOD, BENEFICIAL INTERESTS IN THIS TEMPORARY 

  

 3 








 
REGULATION S GLOBAL SECURITY MAY BE EXCHANGED FOR INTERESTS IN AN IAI GLOBAL SECURITY ONLY IF (1) SUCH EXCHANGE OCCURS IN CONNECTION WITH A TRANSFER OF THE
SECURITIES IN COMPLIANCE WITH AN EXEMPTION UNDER THE SECURITIES ACT AND (2) THE TRANSFEROR OF THE REGULATION S GLOBAL SECURITY FIRST DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO THE EFFECT THAT THE
REGULATION S GLOBAL SECURITY IS BEING TRANSFERRED (A) TO AN “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1),(2),(3) OR (7) UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL INVESTOR ACQUIRING THE SECURITIES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF 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 AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES AND OTHER JURISDICTIONS. 
  
 BENEFICIAL INTERESTS IN A RULE 144A GLOBAL SECURITY OR AN IAI GLOBAL SECURITY MAY BE TRANSFERRED TO A PERSON WHO TAKES DELIVERY IN THE FORM OF AN INTEREST
IN THE REGULATION S GLOBAL SECURITY, WHETHER BEFORE OR AFTER THE EXPIRATION OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD, ONLY IF THE TRANSFEROR FIRST DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO THE
EFFECT THAT SUCH TRANSFER IS BEING MADE IN ACCORDANCE WITH RULE 903 OR 904 OF REGULATION S OR RULE 144 (IF AVAILABLE). 
  
 [Definitive Securities 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. 
  

 4 









			
	No.  _____________________	 	$  ______________

  
 113⁄4% Senior
Notes due 2008 
  
 WMC Finance Co., a Delaware corporation,
promises to pay to                     , or registered assigns, the principal sum of
                     Dollars on December 15, 2008. 
  
 Interest Payment Dates: June 15 and December 15. 
  
 Record Dates: June 1 and December 1. 
  
 Additional provisions of this Security are set forth on the other side of this Security. 
  
 Dated: 
  

			
	WMC FINANCE CO.
		
	 By
	 	  


	 	 	 Name:
 Title:



  

			
		
	 By
	 	  


	 	 	 Name:
 Title:



  

			
	 TRUSTEE’S CERTIFICATE OF
 AUTHENTICATION

	
	JPMORGAN CHASE BANK
	 as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.

		
	 By
	 	  


	 	 	Authorized Officer

  

 5 








 [FORM OF REVERSE SIDE OF INITIAL SECURITY] 
  
 113⁄4% Senior Notes due 2008 
  

	1.	Interest 

  
 WMC Finance Co., a Delaware corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called
the “Company”), promises to pay interest on the principal amount of this Security at the rate per annum shown above; provided, however, that if a Registration Default (as defined in the Registration Rights Agreement) occurs,
additional interest will (subject to certain exceptions set forth in the Registration Rights Agreement) accrue on this Security at a rate of 0.25% per annum (increasing by an additional 0.25% per annum after each consecutive 90-day period that
occurs after the date on which such Registration default occurs up to a maximum additional interest rate of 1.00%) from and including the date on which any such Registration Default shall occur to but excluding the date on which all Registration
Defaults have been cured. The Company will pay interest semiannually on June 15 and December 15 of each year, commencing June 15, 2004. Interest on the Securities will accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from December 16, 2003. Interest will be computed on the basis of a 360-day year of twelve 30-day months. 
  

	2.	Method of Payment 

  
 The Company will pay interest on the Securities (except defaulted interest) to the Persons who are registered holders of Securities at the close of
business on the June 1 or December 1 next preceding the interest payment date even if Securities are canceled after the record date and on or before the interest payment date. Holders must surrender Securities to a Paying Agent to collect principal
payments. The Company will pay principal and interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. Payments in respect of the Securities represented by a Global Security
(including principal, premium and interest) will be made by wire transfer of immediately available funds to the accounts specified by the Depository. The Company will make all payments in 

  

 6 








 
respect of a certificated Security (including principal, premium and interest) by mailing a check to the registered address of each Holder thereof;
provided, however, that payments on a certificated Security will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving
written notice to the Trustee or the Paying Agent to such effect designating such account no later than 30 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion). 
  

	3.	Paying Agent and Registrar 

  
 Initially, JPMorgan Chase Bank, a New York banking corporation (the “Trustee”), will act as Paying Agent and Registrar. The Company may appoint
and change any Paying Agent, Registrar or co-registrar without notice. The Company or any of its domestically incorporated Wholly Owned Subsidiaries may act as Paying Agent, Registrar or co-registrar. 
  

	4.	Indenture 

  
 The Company issued the Securities under an Indenture dated as of December 16, 2003 (the “Indenture”), between the Company and the Trustee. The
terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on the date of the Indenture (the
“Act”). Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. The Securities are subject to all such terms, and Securityholders are referred to the Indenture and the Act for a statement
of those terms. 
  
 The Securities are general unsecured
obligations of the Company. The Company shall be entitled, subject to its compliance with Section 4.03 of the Indenture, to issue Additional Securities pursuant to Section 2.13 of the Indenture. The Initial Securities issued on the Issue Date, any
Additional Securities and all Exchange Securities or Private Exchange Securities issued in exchange therefor will be treated as a single class for all purposes under the Indenture. The Indenture contains covenants that limit the ability of the
Company and its subsidiaries to incur additional indebtedness; pay dividends or distributions on, 

  

 7 








 
or redeem or repurchase, capital stock; make investments; issue or sell capital stock of subsidiaries; engage in transactions with affiliates; create liens
on assets; transfer or sell assets; guarantee indebtedness; restrict dividends or other payments of subsidiaries; consolidate, merge or transfer all or substantially all of its assets and the assets of its subsidiaries; and engage in sale/leaseback
transactions. These covenants are subject to important exceptions and qualifications. 
  

	5.	Optional Redemption 

  
 Except as set forth below, the Company shall not be entitled to redeem the Securities. 
  
 On and after December 15, 2006, the Company shall be entitled at its option on one or more occasions to redeem all or a
portion of the Securities (including Additional Securities, if any) upon not less than 30 nor more than 60 days’ notice, at the redemption prices (expressed in percentages of principal amount on the redemption date), plus accrued and unpaid
interest 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), if redeemed during the 12-month period commencing on December 15 of the years set
forth below: 
  

				
	 Period

	  	Redemption
Price

	 
	 2006
	  	105.875	%
	 2007
	  	102.938	%

  
 In addition, prior to
December 15, 2006, the Company shall be entitled at its option to redeem Securities (which includes Additional Securities, if any) in an aggregate principal amount not to exceed 40% of the aggregate principal amount of the Securities (which includes
Additional Securities, if any) originally issued under the Indenture at a redemption price (expressed as a percentage of principal amount) of 111.750%, plus accrued and unpaid interest to the redemption date, with the net cash proceeds of an Initial
Public Equity Offering; provided, however, that at least 60% of such aggregate principal amount of Securities (which includes Additional Securities, if any) remains outstanding immediately after the occurrence of each such redemption
(other than 

  

 8 








 
Securities held, directly or indirectly, by the Company or its Affiliates). 
  
 Notwithstanding the foregoing, the Company may at any time and from time to time purchase Securities in the open market or
otherwise. 
  

	6.	Notice of Redemption 

  
 Notice of redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each Holder of Securities to be redeemed at
his registered address. Securities in denominations larger than $1,000 principal amount may be redeemed in part but only in whole multiples of $1,000. If money sufficient to pay the redemption price of and accrued interest on all Securities (or
portions thereof) to be redeemed on the redemption date is deposited with the Paying Agent on or before the redemption date and certain other conditions are satisfied, on and after such date interest ceases to accrue on such Securities (or such
portions thereof) called for redemption. 
  

	7.	Put Provisions 

  
 Upon a Change of Control, any Holder of Securities will have the right to cause the Company to repurchase all or any part of the Securities of such Holder
at a repurchase price equal to 101% of the principal amount of the Securities to be repurchased plus accrued interest to the date of repurchase (subject to the right of holders of record on the relevant record date to receive interest due on the
related interest payment date) as provided in, and subject to the terms of, the Indenture. 
  

	8.	Denominations; Transfer; Exchange 

  
 The Securities are in registered form without coupons in denominations of $1,000 principal amount and whole multiples of $1,000. A Holder may transfer or
exchange Securities in accordance with the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or permitted by the Indenture. The
Registrar need not register the transfer of or exchange any Securities selected for redemption (except, in the case of a Security to be redeemed in part, the portion of the Security not to be 

  

 9 








 
redeemed) or any Securities for a period of 15 days before a selection of Securities to be redeemed or 15 days before an interest payment date. 

 

	9.	Persons Deemed Owners 

  
 The registered Holder of this Security may be treated as the owner of it for all purposes. 
  

	10.	Unclaimed Money 

  
 If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Company at
its request unless an abandoned property law designates another Person. After any such payment, Holders entitled to the money must look only to the Company and not to the Trustee for payment. 
  

	11.	Discharge and Defeasance 

  
 Subject to certain conditions, the Company at any time shall be entitled to terminate some or all of its obligations under the Securities and the
Indenture if the Company deposits with the Trustee money or U.S. Government Obligations for the payment of principal and interest on the Securities to redemption or maturity, as the case may be. 
  

	12.	Amendment, Waiver 

  
 Subject to certain exceptions set forth in the Indenture, (a) the Indenture and the Securities may be amended with the written consent of the Holders of
at least a majority in principal amount outstanding of the Securities and (b) any default or noncompliance with any provision may be waived with the written consent of the Holders of a majority in principal amount outstanding of the Securities.
Subject to certain exceptions set forth in the Indenture, without the consent of any Securityholder, the Company and the Trustee shall be entitled to amend the Indenture or the Securities to cure any ambiguity, omission, defect or inconsistency, or
to comply with Article 5 of the Indenture, or to provide for uncertificated Securities in addition to or in place of certificated Securities, or to add guarantees with respect to the Securities, or to add additional covenants or surrender rights and
powers conferred on the Company, or to 

  

 10 








 
comply with any requirement of the SEC in connection with qualifying the Indenture under the Act, or to make any change that does not adversely affect the
rights of any Securityholder, or to make amendments to provisions of the Indenture relating to the form, authentication, transfer and legending of the Securities. 
  

	13.	Defaults and Remedies 

  
 Under the Indenture, Events of Default include (a) default for 30 days in payment of interest on the Securities; (b) default in payment of principal on
the Securities at maturity, upon redemption pursuant to paragraph 5 of the Securities, upon acceleration or otherwise, or failure by the Company to redeem or purchase Securities when required; (c) failure by the Company to comply with other
agreements in the Indenture or the Securities, in certain cases subject to notice and lapse of time; (d) certain accelerations (including failure to pay within any grace period after final maturity) of other Indebtedness of the Company if the amount
accelerated (or so unpaid) exceeds $10.0 million; (e) certain events of bankruptcy or insolvency with respect to the Company and the Significant Subsidiaries; and (f) certain judgments or decrees for the payment of money in excess of $10.0 million.
If an Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the Securities may declare all the Securities to be due and payable immediately. Certain events of bankruptcy or insolvency are Events
of Default which will result in the Securities being due and payable immediately upon the occurrence of such Events of Default. 
  
 Securityholders may not enforce the Indenture or the Securities except as provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security satisfactory to it. Subject to certain limitations, Holders of a majority in principal amount of the Securities may direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Securityholders notice of any continuing Default (except a Default in payment of principal or interest) if it determines that withholding notice is not opposed to the interests of the Holders. 
  

 11 









	14.	Trustee Dealings with the Company 

  
 Subject to certain limitations imposed by the Act, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee. 
  

	15.	No Recourse Against Others 

  
 A director, officer, employee, incorporator or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under
the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. By accepting a Security, each Securityholder waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Securities. 
  

	16.	Authentication 

  
 This Security shall not be valid until an authorized signatory of the Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security. 
  

	17.	Abbreviations 

  
 Customary abbreviations may be used in the name of a Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act). 
  

	18.	CUSIP and ISIN Numbers 

  
 Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP and ISIN numbers to
be printed on the Securities and has directed the Trustee to use CUSIP and ISIN numbers in notices of redemption as a convenience to Securityholders. No representation is made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and 

  

 12 








 
reliance may be placed only on the other identification numbers placed thereon. 
  

	19.	Holders’ Compliance with Registration Rights Agreement. 

  
 Each Holder of a Security, by acceptance hereof, acknowledges and agrees to the provisions of the Registration Rights Agreement, including the obligations
of the Holders with respect to a registration and the indemnification of the Company to the extent provided therein. 
  

	15.	Governing Law. 

  
 THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. 
  
 The Company will furnish to any Securityholder upon written request and
without charge to the Security holder a copy of the Indenture which has in it the text of this Security in larger type. Requests may be made to: 
  
 WMC Finance Co. 
 6320 Canoga Avenue 
 Woodland Hills, California 91367 
  
 Attention: General Counsel 
  

 13 








 ASSIGNMENT FORM 
  
 To assign this Security, fill in the form below: 
  
 I or we assign and transfer this Security to 
  
 (Print or type assignee’s name, address and zip code) 
  
 (Insert assignee’s soc. sec. or tax I.D. No.) 
  
 and irrevocably appoint
                                        
             agent to transfer this Security on the books of the Company. The agent may substitute another to act for him. 
  

							
	  


	Date:	 	  

	 	Your Signature:	 	  


	  



  
 Sign exactly as your name appears on
the other side of this Security. 
  
 In connection with any transfer of any of the
Securities evidenced by this certificate occurring prior to the expiration of the period referred to in Rule 144(k) under the Securities Act after the later of the date of original issuance of such Securities and the last date, if any, on which such
Securities were owned by the Company or any Affiliate of the Company, the undersigned confirms that such Securities are being transferred in accordance with its terms: 
  
 CHECK ONE BOX BELOW 
  

	 	(1)  ̈	to the Company; or 

  

	 	(2)  ̈	pursuant to an effective registration statement under the Securities Act of 1933; or 

  

	 	(3)  ̈	 inside the United States to a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act of 1933) 



  

 14 









	 	 
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 


  

	 	(4)  ̈	outside the United States 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


  

	 	(5)  ̈	pursuant to the exemption from registration provided by Rule 144 under the Securities Act of 1933; or 

  

	 	(6)  ̈	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. 

  
 Unless one of the boxes is checked, the Trustee will refuse to register any of the Securities evidenced by this certificate in the name of any person other than the registered holder thereof; provided, however, that if box
(4), (5) or (6) is checked, the Trustee shall be entitled to require, prior to registering any such transfer of the Securities, such legal opinions, certifications and other information as the Company has reasonably requested to confirm that such
transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933. 
  

	
	
	  


	 Signature



  

 15 








 Signature Guarantee: 
  

					
			
	  

	 	 	 	  


	 Signature must be guaranteed
	 	 	 	 Signature


  
 Signatures must be
guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other
“signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. 
  

 16 








 TO BE COMPLETED BY PURCHASER IF (3) ABOVE IS CHECKED. 
  
 The undersigned represents and warrants that it is purchasing this Security
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 Company 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


  

 17 








 [TO BE ATTACHED TO GLOBAL SECURITIES] 
  
 SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY 
  
 The following increases or decreases in this Global Security have been made: 
  

									
	 Date of Exchange

	 	 Amount of decrease in
Principal amount of
this Global Security

	 	 Amount of increase in
Principal amount of this
Global Security

	  	Principal amount of
this Global Security
following such
decrease or increase

	  	Signature of
authorized officer of
Trustee or Securities
Custodian



  

 18 








 OPTION OF HOLDER TO ELECT PURCHASE 
  
 If you want to elect to have this Security purchased by the Company pursuant to Section 4.06 or 4.09 of the Indenture, check
the box: 
  
  ̈ 
  
 If you want to elect to have only part of this Security purchased by the
Company pursuant to Section 4.06 or 4.09 of the Indenture, state the amount in principal amount: $                     
  

									
				
	Dated:	 	  

	  	 Your Signature:
	 	  


	 	 	 	  	 	 	(Sign exactly as your name appears on the other side of this Security.)

  

			
		
	Signature Guarantee:	 	  


	 	 	(Signature must be guaranteed)

  
 Signatures must be
guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other
“signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. 
  

 19 








 EXHIBIT A 
  

FORM OF FACE OF EXCHANGE SECURITY 
 OR PRIVATE EXCHANGE SECURITY*/**/ 
  


	*/	If the Security is to be issued in global form add the Global Securities Legend from Exhibit 1 to Appendix A and the attachment from such Exhibit 1 captioned “[TO BE ATTACHED
TO GLOBAL SECURITIES] - SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY”. 

  

	**/	If the Security is a Private Exchange Security issued in a Private Exchange to an Initial Purchaser holding an unsold portion of its initial allotment, add the Restricted Securities
Legend from Exhibit 1 to Appendix A and replace the Assignment Form included in this Exhibit A with the Assignment Form included in such Exhibit 1. 

  










			
	 No.
                    
	 	$                    

  
 113⁄4% Senior
Notes due 2008 
  
 WMC Finance Co., a Delaware corporation,
promises to pay to                     , or registered assigns, the principal sum of
                     Dollars on December 15, 2008. 
  
 Interest Payment Dates: June 15 and December 15. 
  
 Record Dates: June 1 and December 1. 
  
 Additional provisions of this Security are set forth on the other side of this Security. 
  
 Dated: 
  

			
	 WMC FINANCE CO.

		
	 By
	 	  


	 	 	 Name:

	 	 	 Title:

	 
		
	 By
	 	  


	 	 	 Name:

	 	 	 Title:



  

			
	 TRUSTEE’S CERTIFICATE OF
AUTHENTICATION

	
	 JPMORGAN CHASE BANK
as Trustee, certifies
 that this is one of the Securities referred
 to in the Indenture.

		
	 By
	 	  


	 	 	 Authorized Officer


  

 2 








 FORM OF REVERSE SIDE OF EXCHANGE SECURITY 
 OR PRIVATE EXCHANGE SECURITY 
  
 113⁄4% Senior Notes Due 2008 
  

	1.	Interest 

  
 WMC Finance Co., a Delaware corporation (such corporation, and its successors and assigns under the Indenture hereinafter referred to, being herein called
the “Company”), promises to pay interest on the principal amount of this Security at the rate per annum shown above[; provided, however, that if a Registration Default (as defined in the Registration Rights Agreement) occurs,
additional interest will (subject to certain exceptions set forth in the Registration Rights Agreement) accrue on this Security at a rate of 0.25% per annum (increasing by an additional 0.25% per annum after each consecutive 90-day period that
occurs after the date on which such Registration default occurs up to a maximum additional interest rate of 1.00%) from and including the date on which any such Registration Default shall occur to but excluding the date on which all Registration
Defaults have been cured.]1 The Company will pay interest semiannually on June 15 and December 15 of each year,
commencing June 15, 2004. Interest on the Securities will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from December 16, 2003. Interest will be computed on the basis of a 360-day year of twelve
30-day months. 
  

	2.	Method of Payment 

  
 The Company will pay interest on the Securities (except defaulted interest) to the Persons who are registered holders of Securities at the close of
business on the June 1 or December 1 next preceding the interest payment date even if Securities are canceled after the record date and on or before the interest payment date. 
  


	1	Insert if at the date of issuance of the Exchange Security or Private Exchange Security (as the case may be) any Registration Default has occurred with respect to
the related Initial Securities during the interest period in which such date of issuance occurs. 

  

 3 








 Holders must surrender Securities to a Paying Agent to collect principal payments. The Company will pay principal and
interest in money of the United States that at the time of payment is legal tender for payment of public and private debts. Payments in respect of the Securities represented by a Global Security (including principal, premium and interest) will be
made by wire transfer of immediately available funds to the accounts specified by the Depository. The Company will make all payments in respect of a certificated Security (including principal, premium and interest) by mailing a check to the
registered address of each Holder thereof; provided, however, that payments on a certificated Security will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder
elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 30 days immediately preceding the relevant due date for payment (or such other date as the Trustee may
accept in its discretion). 
  

	3.	Paying Agent and Registrar 

  
 Initially, JPMorgan Chase Bank, a New York banking corporation (the “Trustee”), will act as Paying Agent and Registrar. The Company may appoint
and change any Paying Agent, Registrar or co-registrar without notice. The Company or any of its domestically incorporated Wholly Owned Subsidiaries may act as Paying Agent, Registrar or co-registrar. 
  

	4.	Indenture 

  
 The Company issued the Securities under an Indenture dated as of December 16, 2003 (“Indenture”), between the Company and the Trustee. The terms
of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) as in effect on the date of the Indenture (the
“Act”). Terms defined in the Indenture and not defined herein have the meanings ascribed thereto in the Indenture. The Securities are subject to all such terms, and Securityholders are referred to the Indenture and the Act for a statement
of those terms. 
  
 The Securities are general unsecured
obligations of the Company. The Company shall be entitled, subject to its compliance with Section 4.03 of the Indenture, to issue 

  

 4 








 
Additional Securities pursuant to Section 2.13 of the Indenture. The Initial Securities issued on the Issue Date, any Additional Securities and all
Exchange Securities or Private Exchange Securities issued in exchange therefor will be treated as a single class for all purposes under the Indenture. The Indenture contains covenants that limit the ability of the Company and its subsidiaries to
incur additional indebtedness; pay dividends or distributions on, or redeem or repurchase, capital stock; make investments; issue or sell capital stock of subsidiaries; engage in transactions with affiliates; create liens on assets; transfer or sell
assets; guarantee indebtedness; restrict dividends or other payments of subsidiaries; consolidate, merge or transfer all or substantially all of its assets and the assets of its subsidiaries; and engage in sale/leaseback transactions. These
covenants are subject to important exceptions and qualifications. 
  

	5.	Optional Redemption 

  
 Except as set forth below, the Company shall not be entitled to redeem the Securities. 
  
 On and after December 15, 2006, the Company shall be entitled at its option on one or more occasions to redeem all or a
portion of the Securities (including Additional Securities, if any) upon not less than 30 nor more than 60 days’ notice, at the redemption prices (expressed in percentages of principal amount, on the redemption date) plus accrued and unpaid
interest 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), if redeemed during the 12-month period commencing on December 15 of the years set
forth below: 
  

				
	 Period

	  	Redemption
Price

	 
	 2006
	  	105.875	%
	 2007
	  	102.938	%

  
 In addition, prior to
December 15, 2006, the Company shall be entitled at its option to redeem Securities (which includes Additional Securities, if any) in an aggregate principal amount not to exceed 40% of the aggregate principal amount of the Securities (which includes
Additional Securities, if any) originally issued under the 

  

 5 








 
Indenture at a redemption price (expressed as a percentage of principal amount) of 111.750%, plus accrued and unpaid interest to the redemption date, with
the net cash proceeds of an Initial Public Equity Offering; provided, however, that at least 60% of such aggregate principal amount of Securities (which includes Additional Securities, if any) remains outstanding immediately after the
occurrence of each such redemption (other than Securities held, directly or indirectly, by the Company or its Affiliates). 
  
 Notwithstanding the foregoing, the Company may at any time and from time to time purchase Securities in the open market or otherwise. 
  

	6.	Notice of Redemption 

  
 Notice of redemption will be mailed at least 30 days but not more than 60 days before the redemption date to each Holder of Securities to be redeemed at
his registered address. Securities in denominations larger than $1,000 principal amount may be redeemed in part but only in whole multiples of $1,000. If money sufficient to pay the redemption price of and accrued interest on all Securities (or
portions thereof) to be redeemed on the redemption date is deposited with the Paying Agent on or before the redemption date and certain other conditions are satisfied, on and after such date interest ceases to accrue on such Securities (or such
portions thereof) called for redemption. 
  

	7.	Put Provisions 

  
 Upon a Change of Control, any Holder of Securities will have the right to cause the Company to repurchase all or any part of the Securities of such Holder
at a repurchase price equal to 101% of the principal amount of the Securities to be repurchased plus accrued interest to the date of repurchase (subject to the right of holders of record on the relevant record date to receive interest due on the
related interest payment date) as provided in, and subject to the terms of, the Indenture. 
  

	8.	Denominations; Transfer; Exchange 

  
 The Securities are in registered form without coupons in denominations of $1,000 principal amount and whole multiples of $1,000. A Holder may transfer or
exchange Securities in accordance with the Indenture. The Registrar 

  

 6 








 
may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees required by law or
permitted by the Indenture. The Registrar need not register the transfer of or exchange any Securities selected for redemption (except, in the case of a Security to be redeemed in part, the portion of the Security not to be redeemed) or any
Securities for a period of 15 days before a selection of Securities to be redeemed or 15 days before an interest payment date. 
  

	9.	Persons Deemed Owners 

  
 The registered Holder of this Security may be treated as the owner of it for all purposes. 
  

	10.	Unclaimed Money 

  
 If money for the payment of principal or interest remains unclaimed for two years, the Trustee or Paying Agent shall pay the money back to the Company at
its request unless an abandoned property law designates another Person. After any such payment, Holders entitled to the money must look only to the Company and not to the Trustee for payment. 
  

	11.	Discharge and Defeasance 

  
 Subject to certain conditions, the Company at any time shall be entitled to terminate some or all of its obligations under the Securities and the
Indenture if the Company deposits with the Trustee money or U.S. Government Obligations for the payment of principal and interest on the Securities to redemption or maturity, as the case may be. 
  

	12.	Amendment; Waiver 

  
 Subject to certain exceptions set forth in the Indenture, (a) the Indenture and the Securities may be amended with the written consent of the Holders of
at least a majority in principal amount outstanding of the Securities and (b) any default or noncompliance with any provision may be waived with the written consent of the Holders of a majority in principal amount outstanding of the Securities.
Subject to certain exceptions set forth in the Indenture, without the consent of any Securityholder, the Company and the Trustee shall be entitled to amend the 

  

 7 








 
Indenture or the Securities to cure any ambiguity, omission, defect or inconsistency, or to comply with Article 5 of the Indenture, or to provide for
uncertificated Securities in addition to or in place of certificated Securities, or to add guarantees with respect to the Securities, or to add additional covenants or surrender rights and powers conferred on the Company, or to comply with any
requirement of the SEC in connection with qualifying the Indenture under the Act, or to make any change that does not adversely affect the rights of any Securityholder, or to make amendments to provisions of the Indenture relating to the form,
authentication, transfer and legending of the Securities. 
  

	13.	Defaults and Remedies 

  
 Under the Indenture, Events of Default include (a) default for 30 days in payment of interest on the Securities; (b) default in payment of principal on
the Securities at maturity, upon redemption pursuant to paragraph 5 of the Securities, upon acceleration or otherwise, or failure by the Company to redeem or purchase Securities when required; (c) failure by the Company to comply with other
agreements in the Indenture or the Securities, in certain cases subject to notice and lapse of time; (d) certain accelerations (including failure to pay within any grace period after final maturity) of other Indebtedness of the Company if the amount
accelerated (or so unpaid) exceeds $10.0 million; (e) certain events of bankruptcy or insolvency with respect to the Company and the Significant Subsidiaries; and (f) certain judgments or decrees for the payment of money in excess of $10.0 million.
If an Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the Securities may declare all the Securities to be due and payable immediately. Certain events of bankruptcy or insolvency are Events
of Default which will result in the Securities being due and payable immediately upon the occurrence of such Events of Default. 
  
 Securityholders may not enforce the Indenture or the Securities except as provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security satisfactory to it. Subject to certain limitations, Holders of a majority in principal amount of the Securities may direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Securityholders 

  

 8 








 
notice of any continuing Default (except a Default in payment of principal or interest) if it determines that withholding notice is not opposed to the
interests of the Holders. 
  

	14.	Trustee Dealings with the Company 

  
 Subject to certain limitations imposed by the Act, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed to it by the Company or its Affiliates and may otherwise deal with the Company or its Affiliates with the same rights it would have if it were not Trustee. 
  

	15.	No Recourse Against Others 

  
 A director, officer, employee, incorporator or stockholder, as such, of the Company shall not have any liability for any obligations of the Company under
the Securities or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation. By accepting a Security, each Securityholder waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Securities. 
  

	16.	Authentication 

  
 This Security shall not be valid until an authorized signatory of the Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security. 
  

	17.	Abbreviations 

  
 Customary abbreviations may be used in the name of a Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with rights of survivorship and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act). 
  

	18.	CUSIP and ISIN Numbers 

  
 Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures the Company has caused CUSIP and ISIN numbers to
be printed on 

  

 9 








 
the Securities and has directed the Trustee to use CUSIP and ISIN numbers in notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon. 
  

	[19.	Holders’ Compliance with Registration Rights Agreement 

  
 Each Holder of a Security, by acceptance hereof, acknowledges and agrees to the provisions of the Registration Rights Agreement, including the obligations
of the Holders with respect to a registration and the indemnification of the Company to the extent provided therein.]2 
  

	20.	Governing Law 

  
 THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. 
  
 The Company will furnish to any Securityholder upon written request and
without charge to the Security holder a copy of the Indenture which has in it the text of this Security in larger type. Requests may be made to: 
  
 WMC Finance Co. 
 6320 Canoga Avenue

 Woodland Hills, California 91367 
  
 Attention: General Counsel 
  


	2	Delete if this Security is not being issued in exchange for an Initial Security. 

  

 10 








 ASSIGNMENT FORM 
  
 To assign this Security, fill in the form below: 
  
 I or we assign and transfer this Security to 
  
 (Print or type assignee’s name, address and zip code) 
  
 (Insert assignee’s soc. sec. or tax I.D. No.) 
  
 and irrevocably appoint                      agent to transfer this
Security on the books of the Company. The agent may substitute another to act for him. 
  

							
	  


	Date:	 	  

	 	Your Signature:	 	  


	  



  
 Sign exactly as your name appears on
the other side of this Security. 
  

 11 








 OPTION OF HOLDER TO ELECT PURCHASE 
  
 If you want to elect to have this Security purchased by the Company pursuant to Section 4.06 or 4.09 of the Indenture, check
the box: 
  
  ̈ 
  
 If you want to elect to have only part of this Security purchased by the
Company pursuant to Section 4.06 or 4.09 of the Indenture, state the amount in principal amount: $                     
  

									
				
	Dated:	 	  

	 	 Your Signature:
	 	  


	 	 	 	 	 	 	(Sign exactly as your name appears on the other side of this Security.)

  

			
		
	Signature Guarantee:	 	  


	 	 	(Signature must be guaranteed)

  
 Signatures must be guaranteed by an
“eligible guarantor institution” meeting the requirements of the Registrar, which requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature guarantee
program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the Securities Exchange Act of 1934, as amended. 
  









 EXHIBIT 2 TO RULE 144A/REGULATION S/IAI APPENDIX 
  
 Form of Transferee Letter of Representation 
  
 WMC Finance Co. 
 6320 Canoga Avenue 
 Woodland Hills, California 91367 
  
 In care of 
 [                    ] 
  
 Ladies and Gentlemen: 
  
 This certificate is delivered to request a transfer of
$[                    ] principal amount of the 113⁄4% Senior Notes due 2008 (the “Securities”) of WMC Finance Co. (the
“Company”). 
  
 Upon transfer, the Securities would be
registered in the name of the new beneficial owner as follows: 
  

			
	 Name:
	 	  




			
		
	 Address:
	 	  




			
		
	 Taxpayer ID Numbers:
	 	  



  
 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 Securities, and we invest in or purchase securities similar to the Securities 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 Securities 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 Securities to offer, sell or otherwise transfer such Securities prior to the date
that is two years after the later of the date of original issue and the last date on which the Company or any affiliate of the Company was the owner of such Securities (or any predecessor thereto) (the “Resale Restriction Termination
Date”) only (i) to the Company, (ii) in the United States to a person whom the seller reasonably believes is a qualified institutional buyer in a transaction meeting the requirements of Rule 144A, (iii) 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 purchasing for its own account or for the account of an institutional accredited investor, in each case in a
minimum principal amount of the Securities of $250,000, (iv) outside the United States in a transaction complying with the provisions of Rule 904 under the Securities Act, (v) pursuant to an exemption from registration under the Securities Act
provided by Rule 144 (if available) or (vi) pursuant to an effective registration statement under the Securities Act, in each of cases (i) through (vi) subject 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 Securities is proposed to be made pursuant to clause (iii) 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 Company 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 Securities for investment purposes and not for distribution in violation of the Securities Act. Each purchaser acknowledges that the Company and the Trustee reserve the right prior to the offer, sale or other transfer prior to the Resale
Restriction Termination Date of the Securities pursuant to clause (iii), (iv) or (v) above to require the delivery of 

  









 
an opinion of counsel, certifications or other information satisfactory to the Company and the Trustee. 
  

			
	TRANSFEREE:
		
	 by
	 	  


	 	 	 Name:

	 	 	 Title: