Exhibit 4.1


 


INDENTURE dated as of May 13, 2004 among PP Acquisition Corporation, a Delaware
corporation which will be merged with and into Polypore, Inc., a Delaware
corporation, with Polypore, Inc. continuing as the surviving corporation (the
“Company”), the Guarantors (as herein defined) and The Bank of New York, a New
York banking corporation, as trustee (the “Trustee”).


 


Each
party agrees as follows for the benefit of the other parties and for the equal
and ratable benefit of the Holders of (a) (i) $225,000,000 aggregate principal
amount of the Company’s 83⁄4% Senior Subordinated Notes due May 15, 2012 (the
“Initial Dollar Notes”) in the form of Exhibit A hereto and (ii) €150,000,000
aggregate principal amount of the Company’s 83⁄4% Senior Subordinated Notes due
May 15, 2012 (the “Initial Euro Notes” and together with the Initial Dollar
Notes, the “Initial Notes”) in the form of Exhibit B hereto issued on the date
hereof, (b) any Additional Notes (as defined herein) that may be issued after
the date hereof and (c) if and when issued as provided in the Registration
Agreement (as defined in Appendix A hereto (the “Appendix”)) or otherwise
registered under the Securities Act (as defined in the Appendix) and issued,
the Company’s U.S. Dollar 83⁄4% Senior Subordinated Notes due May 15, 2012 (the
“Exchange Dollar Notes”) and the Company’s Euro 83⁄4% Senior Subordinated Notes
due May 15, 2012 (the “Exchange Euro Notes” and together with the Exchange
Dollar Notes, the “Exchange Notes” and, together with the Initial Notes, the
“Notes”)) issued in the Registered Exchange Offer (as defined in the Appendix)
in exchange for any Initial Notes or otherwise registered under the Securities
Act and issued in the form of Exhibit C or D hereto.  Subject to the conditions and compliance with the covenants set
forth herein, the Company may issue an unlimited aggregate principal amount of
Additional Notes.


 


ARTICLE 1


 


DEFINITIONS
AND INCORPORATION BY REFERENCE


 


                SECTION 1.01.  Definitions.


 


“Acquired
Indebtedness” means Indebtedness (i) of a Person or any of its Subsidiaries
existing at the time such Person becomes a Restricted Subsidiary of the Company
or at the time it merges or consolidates with or into the Company or any of its
Subsidiaries or (ii) that is assumed in connection with the acquisition of
assets from such Person and in each case not incurred by such Person in
connection with, or in anticipation or contemplation of, such Person becoming a
Restricted Subsidiary of the Company or such acquisition, merger or
consolidation.  Acquired Indebtedness
shall be deemed to have been incurred, with respect to clause (i) of the
preceding sentence, on the date such Person becomes a Restricted Subsidiary
and, with respect to clause (ii) of the preceding sentence, on the date of
consummation of such acquisition of assets.


 


“Additional
Interest” means all additional interest then owing pursuant to Section 2
of the Registration Rights Agreement.


 


“Additional
Notes” means, subject to the Company’s compliance with Section 4.03,
83⁄4%  Senior Subordinated Notes Due 2012
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 Notes issued pursuant to an exchange offer for other Notes
outstanding under this Indenture).


 


“Affiliate”
means, with respect to any specified Person, any other Person who directly or
indirectly through one or more intermediaries controls, or is controlled by, or
is under common control with, such specified Person. The term “control” means
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise; and the terms
“controlling” and “controlled” have meanings correlative of the foregoing.
Notwithstanding the foregoing, no Person (other than the Company or any
Subsidiary of the Company) in whom a Securitization Entity makes an Investment
in connection with a Qualified Securitization Transaction shall be deemed to be
an Affiliate of the Company or any of its Subsidiaries solely by reason of such
investment.


 


“Applicable
Currency Equivalent” means, with respect to any monetary amount in a currency
other than U.S. Dollars, in the case of the Dollar Notes, or Euros, in the case
of the Euro Notes, at any time for the determination thereof, the amount of
U.S. Dollars or Euros, as applicable, obtained by converting such foreign
currency involved in such computation into U.S. Dollars or Euros, as
applicable, at the spot rate for the purchase of U.S. Dollars or Euros, as
applicable, with the applicable foreign currency as quoted by Reuters at
approximately 10:00 A.M. (New York time) on the date not more than two Business
Days prior to such determination.


 


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


 


(1)                                  1% of the then outstanding principal amount
of the Note; and


 


(2)                                  the excess of:


 


(a)                                  the present value at such redemption date of
(i) the redemption price of the Note, as applicable, at May 15, 2008 such
redemption price being set forth in Section 3.07 plus (ii) all required
interest payments due on the Note, as applicable, through May 15, 2008
(excluding accrued but unpaid interest), computed using a discount rate equal
to the Treasury Rate with respect to the Dollar Notes and a discount rate equal
to the German Bund Rate with respect to the Euro Notes as of such redemption
date plus 50 basis points; over


 


(b)                                 the then outstanding principal amount of the
Note.


 


“Asset
Acquisition” means (a) an Investment by the Company or any Restricted
Subsidiary of the Company in any other Person pursuant to which such Person
shall become a Restricted Subsidiary of the Company, or shall be merged with or
into the Company or any Restricted Subsidiary of the Company, or (b) the
acquisition by the Company or any Restricted Subsidiary of the Company of the
assets of any Person (other than a Restricted Subsidiary of the Company) other
than in the ordinary course of business.


 


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“Asset
Sale” means any direct or indirect sale, issuance, conveyance, transfer, lease
(other than operating leases entered into in the ordinary course of business),
assignment, disposition or other transfer for value by the Company or any of
its Restricted Subsidiaries (including, without limitation, any Sale and
Leaseback Transaction) to any Person other than the Company or a Restricted
Subsidiary of the Company of:  (a) any
Capital Stock of any Restricted Subsidiary of the Company, or (b) any other
property or assets of the Company or any Restricted Subsidiary of the Company
other than in the ordinary course of business; provided, however,
that Asset Sales or other dispositions shall not include: (i) a transaction or
series of related transactions for which the Company or its Restricted
Subsidiaries receive aggregate consideration of less than $2.5 million; (ii)
the sale, lease, conveyance, disposition or other transfer of all or
substantially all of the assets of the Company as permitted by
Section 5.01 hereof or any disposition that constitutes a Change of
Control; (iii) the sale or discount, in each case without recourse, of accounts
receivable arising in the ordinary course of business, but only in connection
with the compromise or collection thereof; (iv) disposals or replacements of
obsolete or worn-out equipment in the ordinary course of business of the
Company and its Restricted Subsidiaries; (v) the sale, lease, conveyance,
disposition or other transfer by the Company or any Restricted Subsidiary of
assets or property to one or more Restricted Subsidiaries in connection with
Investments permitted by Section 4.07 hereof or pursuant to any Permitted
Investment; (vi) sales of accounts receivable, equipment and related assets
(including, without limitation, contract rights) of the type specified in the
definition of “Qualified Securitization Transaction” to a Securitization Entity
for the fair market value thereof, including cash in an amount at least equal
to 75% of the fair market value thereof as determined in accordance with GAAP
(for the purposes of this clause (vi), Purchase Money Notes shall be deemed to
be cash); (vii) dispositions of cash or Cash Equivalents; (viii) the creation
of a Lien (but not the sale or other disposition of the property subject to
such Lien); (ix) a disposition of inventory in the ordinary course of business;
(x) the licensing or sublicensing of intellectual property or other general intangibles
and licenses, leases or subleases of other property; and (xi) foreclosure on
assets.


 


“Bank
Indebtedness” means all Obligations pursuant to the Credit Facility.


 


“Bankruptcy
Law” means Title 11, U.S. Code or any similar federal or state law for the
relief of debtors.


 


“Board
of Directors” means, as to any Person, the board of directors of such Person or
any duly authorized committee thereof.


 


“Board
Resolution” means, with respect to any Person, a copy of a resolution certified
by the Secretary or an Assistant Secretary of such Person to have been duly
adopted by the Board of Directors of such Person and to be in full force and
effect on the date of such certification, and delivered to the Trustee.


 


“Business
Day” means any day other than a Legal Holiday.


 


“Capital
Stock” means (i) with respect to any Person that is a corporation, any and all
shares, interests, participations or other equivalents (however designated and
whether or not voting) of corporate stock, including each class of Common Stock
and Preferred Stock, of such


 


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Person
and (ii) with respect to any Person that is not a corporation, any and all
partnership or other equity interests of such Person.


 


“Capitalized
Lease Obligations” means, as to any Person, the obligations of such Person
under a lease that are required to be classified and accounted for as capital
lease obligations under GAAP and, for purposes of this definition, the amount
of such obligations at any date shall be the capitalized amount of such
obligations at such date, determined in accordance with GAAP.


 


“Cash
Equivalents” means: (i) marketable direct obligations issued by, or
unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States of
America, in each case maturing within one year from the date of acquisition
thereof; (ii) marketable direct obligations issued by any state of the United
States of America or any political subdivision of any such state or any public
instrumentality thereof maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having one of the three highest
ratings obtainable from either S&P or Moody’s; (iii) commercial paper maturing
no more than one year from the date of creation thereof and, at the time of
acquisition, having a rating of at least A-1 from S&P or at least P-1 from
Moody’s or carrying an equivalent rating by a nationally recognized rating
agency, if both of the two named rating agencies cease publishing ratings of
investments; (iv) certificates of deposit, time deposits, eurodollar time
deposits, overnight bank deposits or bankers’ acceptances maturing within one
year from the date of acquisition thereof issued by any bank organized under
the laws of the United States of America or any state thereof or the District
of Columbia or any U.S. branch of a foreign bank or by a bank organized under
the laws of any foreign country recognized by the United States of America the
long-term debt of which is rated at least “A” or the equivalent thereof by
S&P, or “A” or the equivalent thereof by Moody’s, in each case having at
the date of acquisition thereof combined capital and surplus of not less than
$500.0 million (or the foreign currency equivalent thereof); (v) repurchase
obligations with a term of not more than seven days for underlying securities
of the types described in clause (i) above entered into with any bank meeting
the qualifications specified in clause (iv) above; (vi) investments in any
investment company or money market funds which invest substantially all their
assets in securities of the types described in clauses (i) through (v) above;
and (vii) other short term investments used by Foreign Subsidiaries in accordance
with normal investment practices for cash management in investments of a type
analogous to the foregoing.


 


“Change
of Control” means the occurrence of one or more of the following events: (i)
any sale, lease, exchange or other transfer (in one transaction or a series of
related transactions) of all or substantially all of the assets of the Company
or Holdings to any Person or group of related Persons for purposes of
Section 13(d) of the Exchange Act (a “Group”), other than to the Company (in
the case of the assets of Holdings), the Permitted Holders or their Related
Parties or any Permitted Group; (ii) the approval by the holders of Capital
Stock of the Company of any plan or proposal for the liquidation or dissolution
of the Company (whether or not otherwise in compliance with the provisions of
this Indenture); (iii) any Person or Group (other than the Permitted Holders or
their Related Parties or any Permitted Group) shall become the beneficial
owner, directly or indirectly, of shares representing more than 40% of the
total ordinary voting power represented by the issued and outstanding Capital
Stock of the Company or Holdings at a time when the Permitted Holders and their
Related Parties in the aggregate own a lesser


 


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percentage
of the total ordinary voting power represented by such issued and outstanding
Capital Stock; or (iv) the first day on which a majority of the members of the
Board of Directors of the Company or Holdings are not Continuing Directors.


 


“Common
Stock” of any Person means any and all shares, interests or other
participations in, and other equivalents (however designated and whether voting
or non-voting) of such Person’s common stock, whether outstanding on the Issue
Date or issued after the Issue Date, and includes, without limitation, all
series and classes of such common stock.


 


“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
EBITDA” means, with respect to any Person, for any period, the sum (without
duplication) of such Person’s: (i) Consolidated Net Income; and (ii) to the
extent Consolidated Net Income has been reduced thereby:  (A) all income taxes and foreign withholding
taxes of such Person and its Restricted Subsidiaries paid or accrued in
accordance with GAAP for such period; (B) Consolidated Interest Expense; (C)
Consolidated Non-cash Charges less any non-cash items increasing Consolidated
Net Income for such period (other than normal accruals in the ordinary course
of business), all as determined on a consolidated basis for such Person and its
Restricted Subsidiaries in accordance with GAAP; (D) any cash charges resulting
from the Transactions that are incurred prior to the six month anniversary of
the Issue Date; (E) restructuring costs and acquisition integration costs and
fees, including cash severance payments made in connection with acquisitions;
and (F) the salary and bonus payment made prior to the Issue Date to certain
stockholders as described in Footnote 2 to the section ”Summary historical
and pro forma consolidated financial data” on page 15 of the Offering
Memorandum.  Notwithstanding the
preceding sentence: (x) amounts under clauses (ii)(A)-(F) relating to a
Restricted Subsidiary of a Person will be added to Consolidated Net Income to
compute Consolidated EBITDA of such Person only if (and in the same
proportions) that net income (loss) of such Restricted Subsidiary was included
in calculating Consolidated Net Income of such Person; and (y) to the extent
the amounts set forth in clauses (ii)(A)-(F) are in excess of those necessary
to offset a net loss of such Restricted Subsidiary, such excess will be added
to Consolidated Net Income to compute Consolidated EBITDA only if (and in the
same proportion that) net income of such Restricted Subsidiary would be
included in calculating Consolidated Net Income of such Person if such
Restricted Subsidiary had generated net income instead of net loss.


 


“Consolidated
Fixed Charge Coverage Ratio” means, with respect to any Person, the ratio of
Consolidated EBITDA of such Person during the four full fiscal quarters (the
“Four-Quarter Period”) ending prior to the date of the transaction giving rise
to the need to calculate the Consolidated Fixed Charge Coverage Ratio for which
internal financial statements are available (the “Transaction Date”) to
Consolidated Fixed Charges of such Person for the Four-Quarter Period. In
addition to and without limitation of the foregoing, for purposes of this
definition, “Consolidated EBITDA” and “Consolidated Fixed Charges” shall be
calculated after giving effect on a pro forma basis for the period of such
calculation to: (i) the incurrence or repayment of any Indebtedness or the
issuance of any Designated Preferred Stock of such Person or any of its
Restricted Subsidiaries (and the application of the proceeds thereof) giving
rise to the need to


 


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make
such calculation and any incurrence or repayment of other Indebtedness or the
issuancer or redemption of other Preferred Stock (and the application of the
proceeds thereof), other than the incurrence or repayment of Indebtedness in
the ordinary course of business for working capital purposes pursuant to
revolving credit facilities, occurring during the Four-Quarter Period or at any
time subsequent to the last day of the Four-Quarter Period and on or prior to
the Transaction Date, as if such incurrence or repayment or issuance or
redemption, as the case may be (and the application of the proceeds thereof),
had occurred on the first day of the Four-Quarter Period; and (ii) any Asset
Sales or other dispositions or Asset Acquisitions (including, without
limitation, any Asset Acquisition giving rise to the need to make such
calculation as a result of such Person or one of its Restricted Subsidiaries
(including any Person who becomes a Restricted Subsidiary as a result of the
Asset Acquisition) incurring, assuming or otherwise being liable for Acquired
Indebtedness and also including any Consolidated EBITDA attributable to the
assets which are the subject of the Asset Acquisition or Asset Sale or other
disposition and without regard to clause (iv) of the definition of Consolidated
Net Income) occurring during the Four-Quarter Period or at any time subsequent
to the last day of the Four Quarter Period and on or prior to the Transaction
Date, as if such Asset Sale or other disposition or Asset Acquisition
(including the incurrence or assumption of any such Acquired Indebtedness)
occurred on the first day of the Four-Quarter Period.  If such Person or any of its Restricted Subsidiaries directly or
indirectly guarantees Indebtedness of a third Person, the preceding sentence
shall give effect to the incurrence of such guaranteed Indebtedness as if such
Person or any Restricted Subsidiary of such Person had directly incurred or
otherwise assumed such other Indebtedness that was so guaranteed.


 


Furthermore,
in calculating “Consolidated Fixed Charges” for purposes of determining the
denominator (but not the numerator) of this “Consolidated Fixed Charge Coverage
Ratio”:  (i) interest on outstanding
Indebtedness determined on a fluctuating basis as of the Transaction Date and
which will continue to be so determined thereafter shall be deemed to have
accrued at a fixed rate per annum equal to the rate of interest on such
Indebtedness in effect on the Transaction Date; (ii) notwithstanding clause (i)
of this paragraph, interest on Indebtedness determined on a fluctuating basis,
to the extent such interest is covered by agreements relating to Interest Swap
Obligations, shall be deemed to accrue at the rate per annum resulting after
giving effect to the operation of such agreements; (iii) interest on a
Capitalized Lease Obligation shall be deemed to accrue at an interest rate
reasonably determined by a responsible financial or accounting officer of the
Company to be the rate of interest implicit in such Capitalized Lease
Obligation in accordance with GAAP; (iv) for purposes of making the computation
referred to above, interest on any Indebtedness under a revolving credit
facility computed on a pro forma basis shall be computed based upon the average
daily balance of such Indebtedness during the applicable period; and (v)
interest on Indebtedness that may optionally be determined at an interest rate
based upon a factor of a prime or similar rate, a eurocurrency interbank
offered rate, or other rate, shall be deemed to have been based upon the rate
actually chosen, or, if none, then based upon such optional rate chosen as the
Company may designate.


 


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 (including pro forma expense and cost reductions). In addition, any
such


 


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pro
forma calculation, to reflect operating expense reductions reasonably expected
to result from any acquisition or merger, may include adjustments as
appropriate, in the reasonable determination of the Company as set forth in an
Officers’ Certificate, that either (a) would be permitted pursuant to Rule
11-02 of Regulation S-X of the Securities Act or (b) have been realized or for
which substantially all the steps necessary for realization have been taken or
at the time of determination are reasonably expected to be taken within 12
months following any such acquisition, including, but not limited to, the
execution or termination of any contracts, the termination of any personnel or
the closing of any facility, as applicable, provided
that such adjustments shall be calculated on an annualized basis and will be
set forth in an Officers’ Certificate signed by the Company’s chief financial
officer and another officer which states in detail (i) the amount of such
adjustment or adjustments, and (ii) that such adjustment or adjustments are
based on the reasonable good faith beliefs of the officers executing such
Officers’ Certificate at the time of such execution.


 


“Consolidated
Fixed Charges” means, with respect to any Person for any period, the sum of,
without duplication:  (i) Consolidated
Interest Expense; plus (ii) the product of (x) the amount of all cash dividend
payments on any series of Disqualified Capital Stock of such Person times (y) a
fraction, the numerator of which is one and the denominator of which is one
minus the then current effective consolidated Federal, state and local income
tax rate of such Person, expressed as a decimal (as estimated in good faith by
the chief financial officer of the Company, which estimate shall be
conclusive); plus (iii) the product of (x) the amount of all dividend payments
on any series of Preferred Stock of a Restricted Subsidiary times (y) a
fraction, the numerator of which is one and the denominator of which is one
minus the then current effective consolidated Federal, state and local income
tax rate of such Person, expressed as a decimal (as estimated in good faith by
the chief financial officer of the Company, which estimate shall be
conclusive); provided that
with respect to any series of Preferred Stock that did not pay cash dividends
during such period but that is eligible to pay cash dividends during any period
prior to the maturity date of the Notes, cash dividends shall be deemed to have
been paid with respect to such series of Preferred Stock during such period for
purposes of this clause (iii).


 


“Consolidated
Interest Expense” means, with respect to any Person for any period, the sum of,
without duplication: (i) the aggregate of all cash and non-cash interest
expense with respect to all outstanding Indebtedness of such Person and its
Restricted Subsidiaries, including the net costs associated with Interest Swap
Obligations, for such period determined on a consolidated basis in conformity
with GAAP, but excluding amortization or write-off of debt issuance costs; (ii)
the consolidated interest expense of such Person and its Restricted
Subsidiaries that was capitalized during such period; (iii) the interest
component of Capitalized Lease Obligations paid, accrued and/or scheduled to be
paid or accrued by such Person and its Restricted Subsidiaries during such
period as determined on a consolidated basis in accordance with GAAP; (iv)
commissions, discounts and other fees and charges owed with respect to letters
of credit and bankers’ acceptance financing; and (v) interest actually paid by
the Company or any such Restricted Subsidiary under any Guarantee of
Indebtedness or other obligation of any other Person.


 


“Consolidated
Leverage Ratio” with respect to any Person as of any date of determination
means, the ratio of (x) consolidated Indebtedness of such Person as of the end
of the most recent fiscal quarter for which internal financial statements are
available to (y) the


 


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aggregate
amount of Consolidated EBITDA of such Person for the period of the most recent
four consecutive quarters for which internal financial statements are
available, in each case with such pro forma adjustments to consolidated
Indebtedness and Consolidated EBITDA as are appropriate and consistent with the
pro forma provisions set forth in the definition of Consolidated Fixed Charge
Coverage Ratio.


 


“Consolidated
Net Income” means, for any period, the aggregate net income (or loss) of the
Company and its Restricted Subsidiaries for such period on a consolidated
basis, determined in accordance with GAAP and without any deduction in respect
of Preferred Stock dividends; provided
that there shall be excluded therefrom to the extent otherwise included,
without duplication:  (i) gains and
losses from Asset Sales (without regard to the $2.5 million limitation set
forth in the definition thereof) and the related tax effects according to GAAP;
(ii) gains and losses due solely to fluctuations in currency values and the
related tax effects according to GAAP; (iii) all extraordinary, unusual or
non-recurring charges, gains and losses (including, without limitation, all
restructuring costs, acquisition integration costs and fees, including cash
severance payments made in connection with acquisitions, and any expense or
charge related to the repurchase of Capital Stock or warrants or options to
purchase Capital Stock), and the related tax effects according to GAAP; (iv)
the net income (or loss) of any Person acquired in a pooling of interests
transaction accrued prior to the date it becomes a Restricted Subsidiary of the
Company or is merged or consolidated with or into the Company or any Restricted
Subsidiary of the Company; (v) the net income (but not loss) of any Restricted
Subsidiary of the Company to the extent that the declaration of dividends or
similar distributions by that Restricted Subsidiary of the Company of that
income is prohibited by contract, operation of law or otherwise provided, however, that a Foreign Subsidiary may
agree to restrict its ability to declare dividends or similar distributions
without excluding the net income of such Foreign Subsidiary from Consolidated
Net Income if (a) the agreement that restricts such ability relates to
Permitted Indebtedness described in clause (xv) of that definition, (b) the
proceeds thereof are used, directly or indirectly through intercompany
transfers, to permanently repay Senior Debt or the Notes of the Company, and
(c) the net income of such Foreign Subsidiary, together with the net income of
each other Foreign Subsidiary subject to a similar restriction, does not exceed
10% of Consolidated Net Income; (vi) the net loss of any Person, other than a
Restricted Subsidiary of the Company; (vii) the net income of any Person, other
than a Restricted Subsidiary of the Company, except to the extent of cash
dividends or distributions paid to the Company or a Restricted Subsidiary of
the Company by such Person; (viii) in the case of a successor to the referent
Person by consolidation or merger or as a transferee of the referent Person’s
assets, any earnings of the successor corporation prior to such consolidation,
merger or transfer of assets; (ix) any non-cash compensation charges and
deferred compensation charges, including any arising from existing stock
options resulting from any merger or recapitalization transaction, including the
Transactions; provided, however,
that Consolidated Net Income for any period shall be reduced by any cash
payments made during such period by such Person in connection with any such
deferred compensation, whether or not such reduction is in accordance with
GAAP; (x) inventory purchase accounting 
adjustments and amortization and impairment charges resulting from other
purchase accounting adjustments with respect to the Transactions and other
acquisition transactions and; (xi) unrealized gains and losses due solely to
fluctuations in currency values and related tax effects according to GAAP.


 


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“Consolidated
Non-cash Charges” means, with respect to any Person, for any period, the
aggregate depreciation, amortization and other non-cash charges, impairment and
expenses of such Person and its Restricted Subsidiaries reducing Consolidated
Net Income of such Person and its Restricted Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP (excluding any such
charges that require an accrual of or a reserve for cash payments for any
future period other than accruals or reserves associated with mandatory
repurchases of equity securities). For clarification purposes, purchase accounting
adjustments with respect to inventory will be included in Consolidated Non-cash
Charges.


 


“Continuing
Directors” means, as of any date of determination, any member of the Board of
Directors of the Company who: (i) was a member of such Board of Directors on
the Issue Date; or (ii) was nominated for election or elected to such Board of
Directors by any of the Permitted Holders or with the approval of a majority of
the Continuing Directors who were members of such Board at the time of such
nomination or election.


 


“Corporate
Trust Office of the Trustee” shall be at the address of the Trustee specified
in Section 13.02 hereof or such other address as to which the Trustee may
give notice to the Company.


 


“Credit
Facilities” means one or more debt facilities (including, without limitation,
the Credit Facility) or commercial paper facilities with banks or other
institutional lenders providing for revolving credit loans, term loans,
receivables financing (including through the sale of receivables to such
lenders or to special purpose entities formed to borrow from such lenders
against such receivables) and/or letters of credit or banker’s acceptances.


 


“Credit
Facility” means the Credit Agreement dated as of the Issue Date among the
Company, Holdings, the lenders party thereto in their capacities as lenders
thereunder, JPMorgan Chase Bank, as administrative agent, Bear Stearns
Corporate Lending Inc., as syndication agent and General Electric Capital
Corporation, UBS Securities LLC and Lehman Commercial Paper Inc., as
co-documentation agents, together with the related documents thereto
(including, without limitation, any guarantee agreements and security
documents), in each case as such agreements may be amended (including any
amendment and restatement thereof), supplemented or otherwise modified from
time to time, including any agreement extending the maturity of, refinancing,
replacing or otherwise restructuring (including increasing the amount of
available borrowings thereunder or adding Restricted Subsidiaries of the
Company as additional borrowers or guarantors thereunder) all or any portion of
the Indebtedness under such agreement or any successor or replacement agreement
and whether by the same or any other agent, lender or group of lenders.


 


“Currency
Agreement” means any foreign exchange contract, currency swap agreement,
futures contract, option contract or other similar agreement or arrangement
designed to protect the Company or any Restricted Subsidiary of the Company
against fluctuations in currency values.


 


“Default”
means an event or condition the occurrence of which is, or with the lapse of
time or the giving of notice or both, pursuant to the Default provisions, would
be, an Event of Default.


 


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“Designated
Noncash Consideration” means the fair market value of any noncash consideration
received by the Company or one of its Restricted Subsidiaries in connection
with an Asset Sale that is designated as Designated Noncash Consideration
pursuant to an Officers’ Certificate executed by the principal executive
officer and the principal financial officer of the Company or such Restricted
Subsidiary at the time of such Asset Sale. 
Any particular item of Designated Noncash Consideration will cease to be
considered to be outstanding once it has been sold for cash or Cash
Equivalents. At the time of receipt of any Designated Noncash Consideration,
the Company shall deliver an Officers’ Certificate to the Trustee which shall
state the fair market value of such Designated Noncash Consideration and shall
state the basis of such valuation, which shall be a report of a nationally
recognized investment banking, appraisal or accounting firm with respect to the
receipt in one or a series of related transactions of Designated Noncash
Consideration with a fair market value in excess of $10.0 million.


 


“Designated
Preferred Stock” means Preferred Stock that is so designated as Designated
Preferred Stock, pursuant to an Officers’ Certificate executed by the principal
executive officer and the principal financial officer of the Company, on the
issuance date thereof, the cash proceeds of which are excluded from the
calculation set forth in clause (iii)(w) of the first paragraph of
Section 4.07 hereof.


 


“Designated
Senior Debt” means (i) the Bank Indebtedness and (ii) any other Indebtedness
constituting Senior Debt which, at the time of determination, has an aggregate
principal amount of, or under which, at the date of determination, the holders
thereof are committed to lend up to, at least $25.0 million and is specifically
designated in the instrument evidencing or governing such Senior Debt as
“Designated Senior Debt” by the Company.


 


“Disqualified
Capital 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: (i) 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; (ii) is convertible or
exchangeable at the option of the holder for Indebtedness or Disqualified
Capital Stock (excluding Capital Stock which is convertible or exchangeable
solely at the option of the Company or a Restricted Subsidiary); or (iii) 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 (a) the
final maturity date of the Notes or (b) the date on which there are no Notes
outstanding; provided, however,
that any Capital Stock that would not constitute Disqualified Capital 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 final maturity date of the Notes
shall not constitute Disqualified Capital 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 Notes and described in Sections 4.10 and
4.15 hereof, respectively; and (B) any such requirement only becomes operative after
compliance with such terms applicable to the Notes, including the purchase of
any Notes tendered pursuant thereto. The amount of any Disqualified Capital
Stock that does not have a fixed redemption, repayment or repurchase price will
be calculated in accordance with the terms of such Disqualified Capital Stock
as if such Disqualified Capital Stock were redeemed, repaid or repurchased on
any date on which the amount of such


 


10

















 


Disqualified
Stock is to be determined pursuant to the Indenture; provided, however, that if such
Disqualified Capital 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 Capital Stock as
reflected in the most recent internal financial statements of such Person.


 


“Domestic
Subsidiary” means any direct or indirect Restricted Subsidiary of the Company
that is incorporated under the laws of the United States of America, any State
thereof or the District of Columbia.


 


“Equity
Interests” means Capital Stock and all warrants, options or other rights to
acquire Capital Stock (but excluding any debt security that is convertible
into, or exchangeable for, Capital Stock).


 


“Equity
Offering” means any offering of Qualified Capital Stock of Holdings or the
Company; provided  that:
(i) in the event of an offering by Holdings, Holdings contributes to the
capital of the Company the portion of the net cash proceeds of such offering
necessary to pay the aggregate redemption price (plus accrued interest to the
redemption date) of the Notes to be redeemed pursuant to Section 3.07(c)
hereof; and (ii) in the event such equity offering is not in the form of a
public offering registered under the Securities Act, the proceeds received by
the Company directly or indirectly from such offering are not less than $10.0
million.


 


“Exchange
Act” means the Securities Exchange Act of 1934, as amended, or any successor
statute or statutes thereto.


 


“Exchange
Dollar Notes” has the meaning set forth in the preamble hereto.


 


“Exchange
Euro Notes” has the meaning set forth in the preamble hereto.


 


“Exchange
Notes” has the meaning set forth in the preamble hereto.


 


“Excluded
Contributions” means net cash proceeds, or property other than cash that would
constitute Marketable Securities or Permitted Business, in each case received
by the Company and its Restricted Subsidiaries from:


 


(i)                                     contributions to its common equity capital;
and


 


(ii)                                  the sale (other than to a Subsidiary or to
any management equity plan or stock option plan or any other management or
employee benefit plan or agreement of the Company or any Subsidiary) of Capital
Stock (other than Disqualified Stock and Designated Preferred Stock),


 


in
each case designated as Excluded Contributions pursuant to an Officers’
Certificate on the date such capital contributions are made or the date such
Equity Interests are sold, as the case may be, which are excluded from the
calculation set forth in clause (4)(iii) of Section 4.07 hereof.


 


“EU
Government Obligations” means securities that are:


 


11

















 


(i)                                     direct obligations of any member state of the
European Union (as it exists on the Issue Date) or issued by any agency or
instrumentality thereof for the timely payment of which its full faith and
credit is pledged, or


 


(ii)                                  obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of any member state of
the European Union (as it exists on the Issue Date) the timely payment of which
is unconditionally guaranteed as a full faith and credit obligation by such
member state of the European Union,


 


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


 


“fair
market value” means, with respect to any asset or property, the price which
could be negotiated in an arm’s-length, free market transaction, for cash,
between a willing seller and a willing and able buyer, neither of whom is under
undue pressure or compulsion to complete the transaction. Fair market value
shall be determined by the Board of Directors of the Company acting in good
faith, which determination shall be conclusive.


 


“Foreign
Subsidiary” means any Subsidiary of the Company that is not a Domestic
Subsidiary.


 


“Four-Quarter
Period” has the meaning specified in the definition of Consolidated Fixed
Charge Coverage Ratio.


 


“GAAP”
means generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such other entity as
may be approved by a significant segment of the accounting profession of the
United States of America, as in effect as of the Issue Date.  All ratios and computations based on GAAP
contained in this Indenture will be computed in conformity with GAAP, except as
expressly provided in this Indenture.


 


“German
Bund Rate” means, as of the applicable redemption date, the yield to maturity
as of such redemption date of German Bundesanleihe securities with a constant
maturity (as compiled and published in the most recent financial statistics
that have become publicly available at least two business days prior to such
redemption date (or, if such financial statistics are no longer published, any
publicly available source of similar market data)) most nearly equal to the
period from such redemption date to May 15, 2008; provided, however, that if the period from such redemption
date to May 15, 2008 is less than one year, the weekly average yield on


 


12

















 


actually
traded German Bundesanleihe securities adjusted to a constant maturity of one
year will be used.


 


“Government
Obligations” means, in the case of the Dollar Notes, U.S. Government
Obligations and, in the case of the Euro Notes, EU Government Obligations.


 


“Group”
has the meaning specified in the definition of Change of Control.


 


“Guarantee”
means (i) the guarantee of the Notes by the Domestic Subsidiaries of the
Company in accordance with the terms of this Indenture; and (ii) the guarantee
of the Notes by any Subsidiary required under the terms of Section 4.17
hereof.


 


“Guarantor”
means any Subsidiary that issues a Guarantee; provided, however, that upon the release and
discharge of such Subsidiary from its Guarantee in accordance with
Section 11.07 hereof, such Subsidiary shall cease to be a Guarantor.


 


“Hedging
Agreement” means any agreement with respect to the hedging of price risk
associated with the purchase of commodities used in the business of the Company
and its Restricted Subsidiaries, so long as any such agreement has been entered
into in the ordinary course of business and bona fide hedging purposes (as
determined in good faith by the Board of Directors or senior management of the
Company).


 


“Holder”
means a Person in whose name a Note is registered.


 


“Holdings”
means PP Holdings Corporation, a Delaware corporation.


 


“Indebtedness”
means with respect to any Person, without duplication: (i) all Obligations of
such Person for borrowed money; (ii) all Obligations of such Person evidenced
by bonds, debentures, notes or other similar instruments; (iii) all Capitalized
Lease Obligations of such Person; (iv) all Obligations of such Person issued or
assumed as the deferred and unpaid purchase price of property, all conditional
sale obligations and all Obligations under any title retention agreement (but
excluding trade accounts payable and other accrued liabilities arising in the
ordinary course of business); (v) all Obligations for the reimbursement of any
obligor on any letter of credit, banker’s acceptance or similar credit
transaction (including reimbursement obligations with respect thereto except to
the extent such reimbursement obligation relates to a trade payable and such
obligation is satisfied within 30 days of incurrence); (vi) guarantees and
other contingent obligations in respect of Indebtedness of other Persons
referred to in clauses (i) through (v) above and clause (viii) below; (vii) all
Obligations of any other Person of the type referred to in clauses (i) through
(vi) which are secured by any Lien on any property or asset of such Person
whether or not such Indebtedness is assumed by such Person, the amount of such
Obligation being deemed to be the lesser of the fair market value of such
property or asset at such date of determination and the amount of the
Obligation so secured; (viii) all Obligations under Currency Agreements and
Interest Swap Obligations of such Person (the amount of any such obligations to
be equal at any time to the termination value, as determined in good faith by
the Company’s Board of Directors, which determination will be conclusive, of
such agreement or arrangement giving rise to such obligation that would be
payable by such Person at such time); and (ix) all Disqualified Capital Stock
issued by such Person with the amount of Indebtedness represented by such
Disqualified Capital Stock being equal to the greater of its


 


13

















 


voluntary
or involuntary liquidation preference and its maximum fixed repurchase price
or, with respect to any Subsidiary that is not a Guarantor, any Preferred Stock
(but excluding, in each case, accrued dividends, if any).


 


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 60 days thereafter.  For
clarification purposes, the liability of the Company or any Restricted
Subsidiary to make periodic payments to licensors in consideration for the
license of patents and technical information under license agreements in
existence on the Issue Date and any amount payable in respect of a settlement
of disputes with respect to such payments thereunder shall not constitute
Indebtedness.


 


For
purposes hereof, the “maximum fixed repurchase price” of any Disqualified
Capital Stock which does not have a fixed repurchase price shall be calculated
in accordance with the terms of such Disqualified Capital Stock as if such
Disqualified Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to the Indenture, and if such price
is based upon, or measured by, the fair market value of such Disqualified
Capital Stock, such fair market value shall be determined reasonably and in
good faith by the Board of Directors of the issuer of such Disqualified Capital
Stock. For the purposes of calculating the amount of Indebtedness of a
Securitization Entity outstanding as of any date, the face or notional amount
of any interest in receivables or equipment that is outstanding as of such date
shall be deemed to be Indebtedness but any such interests held by Affiliates of
such Securitization Entity shall be excluded for purposes of such calculation.


 


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


 


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


 


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


 


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


 


“Intellectual
Property” means, collectively, the patents, patent applications, trademarks,
service marks, trade names, trademark registrations, service mark
registrations, copyrights, licenses and know-how (including trade secrets and
other unpatented and/or unpatentable proprietary or confidential information,
systems or procedures).


 


“Interest
Swap Obligations” means the obligations of any Person pursuant to any
arrangement with any other Person, whereby directly or indirectly, such Person
is entitled to receive from time to time periodic payments calculated by
applying either a floating or a fixed rate of interest on a stated notional
amount in exchange for periodic payments made by such other Person calculated
by applying a fixed or a floating rate of interest on the same notional amount
and shall include, without limitation, interest rate swaps, caps, floors,
collars and similar agreements.


 


14

















 


“Investment”
means, with respect to any Person, any direct or indirect advance, loan or
other extension of credit (including, without limitation, a guarantee or
similar arrangement but excluding any debt or extension of credit represented
by a bank deposit other than a time deposit) 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 by such Person of any Capital Stock, bonds, notes, debentures or
other securities or evidences of Indebtedness issued by, any Person.
“Investment” shall exclude extensions of trade credit by the Company and its
Restricted Subsidiaries in accordance with normal trade practices of the
Company or such Restricted Subsidiary, as the case may be. If the Company or
any Restricted Subsidiary of the Company sells or otherwise disposes of any
Common Stock of any direct or indirect Restricted Subsidiary of the Company
such that, after giving effect to any such sale or disposition, such Restricted
Subsidiary is no longer a Restricted Subsidiary of the Company (or, in the case
of a Restricted Subsidiary that is not a Wholly-Owned Restricted Subsidiary of
the Company, such Restricted Subsidiary has a minority interest that is held by
an Affiliate of the Company that is not a Restricted Subsidiary of the
Company), the Company shall be deemed to have made an Investment on the date of
any such sale or disposition equal to the fair market value of the Common Stock
of such Restricted Subsidiary, not sold or disposed of. Except as otherwise
provided 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 its fair market value.  For purposes
of Section 4.07 hereof:


 


(i)                                     “Investment” will include the portion
(proportionate to the Company’s equity interest in a Restricted Subsidiary to
be designated as an Unrestricted Subsidiary) of the fair market value of the
net assets of such Restricted Subsidiary at the time that such Restricted
Subsidiary is designated an Unrestricted Subsidiary; provided, however, that upon a
redesignation of such Subsidiary as a Restricted Subsidiary, the Company will
be deemed to continue to have a permanent “Investment” in an Unrestricted
Subsidiary in an amount (if positive) equal to (a) the Company’s “Investment”
in such Subsidiary at the time of such redesignation less (b) the portion
(proportionate to the Company’s equity interest in such Subsidiary) of the fair
market value of the net assets (as conclusively determined by the Board of
Directors of the Company in good faith) of such Subsidiary at the time that
such Subsidiary is so re-designated a Restricted Subsidiary; and


 


(ii)                                  any property transferred to or from an
Unrestricted Subsidiary will be valued at its fair market value at the time of
such transfer, in each case as determined in good faith by the Board of
Directors of the Company.


 


“Issue
Date” means the date hereof.


 


“Legal
Holiday” means a Saturday, a Sunday or a day on which banking institutions in
the City of New York, the city in which the principal corporate trust office of
the Trustee is located or at a place of payment are authorized by law,
regulation or executive order to remain closed. If a payment date is a Legal Holiday
at a place of payment, payment may be made at that place on the next succeeding
day that is not a Legal Holiday, and no interest shall accrue on such payment
for the intervening period.


 


15

















 


“Lien”
means any lien, mortgage, deed of trust, pledge, security interest, charge or
encumbrance of any kind (including any conditional sale or other title
retention agreement, any lease in the nature thereof and any agreement to give
any security interest).


 


“Marketable
Securities” means publicly traded debt or equity securities that are listed for
trading on a national securities exchange or NASDAQ and that were issued by a
corporation whose debt securities are rated in one of the three highest rating
categories by either S&P or Moody’s.


 


“Moody’s”
means Moody’s Investors Service, Inc. or any successor thereto.


 


“Net
Cash Proceeds” means, with respect to any Asset Sale, the proceeds in the form
of cash or Cash Equivalents including payments in respect of deferred payment
obligations when received in the form of cash or Cash Equivalents (other than
the portion of any such deferred payment constituting interest) received by the
Company or any of its Restricted Subsidiaries from such Asset Sale net of: (i)
reasonable out-of-pocket expenses and fees relating to such Asset Sale
(including, without limitation, legal, accounting and investment banking fees
and sales commissions and title and recording tax expenses); (ii) all Federal,
state, provincial, foreign and local taxes required to be accrued as a
liability under GAAP, as a consequence of such Asset Sale; (iii) appropriate
amounts to be provided by the Company or any Restricted Subsidiary, as the case
may be, as a reserve, in accordance with GAAP, against any liabilities
associated with such Asset Sale and retained by the Company or any Restricted
Subsidiary, as the case may be, after such Asset Sale, including, without
limitation, pension and other post-employment benefit liabilities, liabilities
related to environmental matters and liabilities under any indemnification
obligations associated with such Asset Sale; (iv) all distributions and other
payments required to be made to minority interest holders in Subsidiaries or
joint ventures as a result of such Asset Sale; and (v) all payments made on any
Indebtedness which is secured by any assets subject to such Asset Sale, 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 Sale, or by applicable law, be repaid
out of the proceeds from such Asset Sale.


 


“Notes”
means, collectively, the Initial Notes and the Exchange Notes treated as a
single class of securities, as amended or supplemented from time to time in
accordance with the terms hereof, that are issued pursuant to this Indenture.


 


“Obligations”
means all obligations for principal, premium, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.


 


“Offering
Memorandum” means the offering memorandum relating to the offering of the
Initial Notes dated May 6, 2004.


 


“Officer”
means, with respect to any Person (other than the Trustee), the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice-President of such Person.


 


16

















 


“Officers’
Certificate” means a certificate signed on behalf of the Company by two
Officers of the Company, one of whom must be the principal executive officer,
the principal financial officer, the treasurer or the principal accounting
officer of the Company, that meets the requirements of Sections 13.04 and 13.05
hereof.


 


“Opinion
of Counsel” means an opinion from legal counsel who is reasonably acceptable to
the Trustee. The counsel may be an employee of or counsel to the Company or any
Subsidiary of the Company.


 


“Permitted
Acquisition Payments” means, without duplication, any payments made in
connection with the Transactions pursuant to the Stock Purchase Agreement and
any other agreements or documents related to the Transactions and set forth as
Schedule I to this Indenture in effect on the Issue Date (without giving
effect to subsequent amendments, waivers or other modifications to such
agreements or documents) or as otherwise described in the Offering Memorandum.


 


“Permitted
Business” means any business (including stock or assets) that derives a
majority of its revenues from the business engaged in by the Company and its
Restricted Subsidiaries on the Issue Date and/or activities that are reasonably
similar, ancillary or related to, or a reasonable extension, development or
expansion of, the businesses in which the Company and its Restricted
Subsidiaries are engaged on the Issue Date.


 


“Permitted
Group” means any group of investors party to the Stockholders’ Agreement, as
the same may be amended, modified or supplemented from time to time, provided that the Permitted Holders
and their Related Parties continue to be the “beneficial owners” (as such term
is used in Section 13(d) of the Exchange Act), directly or indirectly, of
more than 50% of the voting power of the issued and outstanding Capital Stock
of the Company or Holdings (as applicable) that is “beneficially owned” (as
defined above) by such group of Investors.


 


“Permitted
Holders” means Warburg Pincus Private Equity VIII, L.P., Warburg Pincus
International Partners, L.P., its Affiliates and any general or limited
partners of Warburg Pincus Private Equity VIII, L.P. or Warburg Pincus
International Partners, L.P. on the Issue Date.


 


“Permitted
Indebtedness” means, without duplication, each of the following:


 


(i)  Indebtedness under the Notes (other than any
Additional Notes) and the incurrence by the Company of Indebtedness represented
by the Exchange Notes issued in exchange for the Notes (or in exchange for any
Additional Notes issued in accordance with the terms of the Indenture) and the
Guarantees thereof;


 


(ii)  Indebtedness of the Company or the
Guarantors incurred pursuant to one or more Credit Facilities in an aggregate
principal amount at any time outstanding not to exceed $660.0 million
less:  (A) the aggregate amount of
Indebtedness of Securitization Entities at the time outstanding, (B) the amount
of all mandatory principal payments actually made by the Company or any such
Restricted Subsidiary since the Issue Date with the Net Cash Proceeds of an
Asset Sale in respect of term loans under a credit facility (excluding any such
payments to the extent refinanced at the time of payment), and (C) any
repayments of revolving credit borrowings under a credit facility with the Net
Cash Proceeds of an Asset Sale that are accompanied by a


 


17

















 


corresponding
commitment reduction thereunder; provided
that the amount of Indebtedness permitted to be incurred pursuant to the Credit
Facilities in accordance with this clause (ii) shall be in addition to any
Indebtedness permitted to be incurred pursuant to the Credit Facilities in
reliance on, and in accordance with, clauses (vii), (xiii), (xiv) and (xv)
below;


 


(iii)  other Indebtedness of the Company and its
Restricted Subsidiaries outstanding on the Issue Date (and in the case of any
line of credit, the unused capacity of such line of credit as of the Issue
Date), reduced by the amount of any scheduled amortization payments or mandatory
prepayments when actually paid or permanent reductions thereon;


 


(iv)  Interest Swap Obligations of the Company or
any of its Restricted Subsidiaries covering Indebtedness of the Company or any
of its Restricted Subsidiaries; provided,
however, that any Indebtedness to which any such Interest Swap
Obligations correspond is otherwise permitted to be incurred under this
Indenture; and provided, further,
that such Interest Swap Obligations are entered into, in the judgment of the
Company, to protect the Company or any of its Restricted Subsidiaries from
fluctuation in interest rates on its outstanding Indebtedness;


 


(v)  Indebtedness of the Company or any
Restricted Subsidiary under Hedging Agreements and Currency Agreements;


 


(vi)  intercompany Indebtedness between or among
the Company and any such Restricted Subsidiaries (other than a Securitization
Entity); provided, however,
that: (a) if the Company is the obligor on such Indebtedness and the payee is a
Restricted Subsidiary that is not a Guarantor, such Indebtedness is expressly
subordinated to the prior payment in full in cash of all Obligations with
respect to the Notes; and (b)(1) any subsequent issuance or transfer of Capital
Stock or any other event which results in any such Indebtedness being beneficially
held by a Person other than the Company or a Restricted Subsidiary (other than
a Securitization Entity) thereof; and (2) any sale or other transfer of any
such Indebtedness to a Person that is not either the Company or a Restricted
Subsidiary (other than a Securitization Entity) thereof (other than by way of
granting a Lien permitted under this Indenture or in connection with the
exercise of remedies by a secured creditor) shall be deemed, in each case, to
constitute an incurrence of such Indebtedness by the Company or such Restricted
Subsidiary, as the case may be, that was not permitted by this clause (vi);


 


(vii)  Indebtedness (including Capitalized Lease
Obligations) incurred by the Company or any of its Guarantors to finance the
purchase, lease or improvement of property (real or personal) or equipment
(whether through the direct purchase of assets or the Capital Stock of any
person owning such assets) in an aggregate principal amount outstanding not to
exceed the greater of (a) $20.0 million and (b) 1.5% of Total Assets;


 


(viii)  Refinancing Indebtedness (other than
Refinancing Indebtedness with respect to Indebtedness incurred pursuant to
clause (ii) of this definition);


 


(ix)  guarantees by the Company and its Restricted
Subsidiaries of each other’s Indebtedness; provided,
however, that such Indebtedness is permitted to be incurred under
this Indenture; provided, further,
that in the event such Indebtedness (other than Acquired


 


18

















 


Indebtedness)
is incurred pursuant to the Consolidated Fixed Charge Coverage Ratio, such
guarantees are by the Company or a Guarantor only;


 


(x)  Indebtedness arising from agreements of the
Company or a Restricted Subsidiary of the Company providing for indemnification,
adjustment of purchase price, earn-out or other similar obligations, in each
case, incurred or assumed in connection with the disposition of any business,
assets or Capital Stock of a Restricted Subsidiary of the Company, other than
guarantees of Indebtedness incurred by any Person acquiring all or any portion
of such business, assets or Restricted Subsidiary for the purpose of financing
such acquisition; provided, however,
that the maximum assumable liability in respect of all such Indebtedness
shall at no time exceed the gross proceeds actually received by the Company and
its Restricted Subsidiaries in connection with such disposition;


 


(xi)  obligations in respect of performance and
surety bonds and completion guarantees provided by the Company or any
Restricted Subsidiary of the Company in the ordinary course of business;


 


(xii)  Indebtedness of a Securitization Entity
incurred in a Qualified Securitization Transaction that is non-recourse to the
Company or any Subsidiary of the Company (except for Standard Securitization
Undertakings);


 


(xiii)  Indebtedness incurred by the Company or any
of the Guarantors in connection with the acquisition of a Permitted Business; provided  that on the date of the
incurrence of such Indebtedness, after giving effect to the incurrence thereof
and the use of proceeds therefrom, the Consolidated Fixed Charge Coverage Ratio
of the Company is greater than the Consolidated Fixed Charge Coverage Ratio of
the Company immediately prior to the incurrence of such Indebtedness;


 


(xiv)  additional Indebtedness of the Company and
the Guarantors in an aggregate principal amount which does not exceed $50.0
million at any one time outstanding which amount may, but need not, be incurred
in whole or in part under a credit facility (it being understood that any
Indebtedness or Preferred Stock incurred pursuant to this clause (xiv) shall
cease to be deemed incurred or outstanding for purposes of this clause (xiv)
but shall be deemed incurred under Section 4.09 hereof from and after the
first date on which the Company or such Restricted Subsidiary could have
incurred such Indebtedness or Preferred Stock thereunder without reliance on
this clause (xiv));


 


(xv)  additional Indebtedness of the Foreign
Subsidiaries in an aggregate principal amount which does not exceed the greater
of (a) $50.0 million and (b) 3.6% of the Total Assets of the Foreign
Subsidiaries at any one time outstanding (which amount may, but need not, be
incurred in whole or in part under a credit facility);


 


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


 


19

















 


(xvii)  Indebtedness of the Company or any of its
Restricted Subsidiaries represented by letters of credit for the account of the
Company or such Restricted Subsidiary, as the case may be, issued in the
ordinary course of business of the Company or such Restricted Subsidiary,
including, without limitation, in order to provide security for workers’
compensation claims or payment obligations in connection with self-insurance or
similar requirements in the ordinary course of business and other Indebtedness
with respect to workers’ compensation claims, self-insurance obligations,
performance, surety and similar bonds and completion guarantees provided by the
Company or any Restricted Subsidiary of the Company in the ordinary course of
business; and


 


(xviii)
Indebtedness consisting of promissory notes issued by the Company or any
Guarantor to current or former officers, directors and employees, their
respective estates, spouses or former spouses to finance the purchase or
redemption of Equity Interests of Holdings permitted by Section 4.07
hereof.


 


No
Foreign Subsidiary may Incur any Indebtedness (other than pursuant to clause
(vi) of the definition of Permitted Indebtedness) if the proceeds are used to
refinance Indebtedness of the Company; provided,
however, that proceeds of
Indebtedness incurred pursuant to clause (xv) of the definition of Permitted
Indebtedness may be used to permanently repay Senior Debt or the Notes of the
Company.


 


For
purposes of determining compliance with Section 4.09 hereof, in the event
that an item of Indebtedness meets the criteria of more than one of the
categories of Permitted Indebtedness described in clauses (i) through (xviii)
above or is entitled to be incurred pursuant to the Consolidated Fixed Charge
Coverage Ratio provisions of Section 4.09 hereof, the Company shall, in
its sole discretion, divide and classify (or later redivide and reclassify)
such item of Indebtedness in any manner that complies with Section 4.09
hereof. Accrual of interest, accretion or amortization of original issue
discount, the payment of interest on any Indebtedness in the form of additional
Indebtedness with the same terms, and the payment of dividends on Disqualified
Capital Stock in the form of additional shares of the same class of
Disqualified Capital Stock will not be deemed to be an incurrence of
Indebtedness or an issuance of Disqualified Capital Stock for purposes of Section 4.09
hereof.


 


“Permitted
Investments” means: (i) Investments by the Company or any Restricted Subsidiary
of the Company in any Restricted Subsidiary of the Company (other than a
Securitization Entity or Restricted Subsidiary of the Company in which an
Affiliate of the Company that is not a Restricted Subsidiary of the Company
holds a minority interest) (whether existing on the Issue Date or created
thereafter) or any other Person (including by means of any transfer of cash or
other property) if as a result of such Investment such other Person shall
become a Restricted Subsidiary of the Company (other than a Securitization
Entity or Restricted Subsidiary of the Company in which an Affiliate of the
Company that is not a Restricted Subsidiary of the Company holds a minority
interest) or that will merge with or consolidate into the Company or a
Restricted Subsidiary of the Company and Investments in the Company by the
Company or any Restricted Subsidiary of the Company; (ii) investments in cash
and Cash Equivalents; (iii) loans and advances allowed by law (including
payroll, travel and similar advances) to employees of the Company and its
Restricted Subsidiaries in an aggregate principal amount not to exceed $10.0
million at any one time outstanding; (iv) Currency Agreements,


 


20

















 


Hedging
Agreements and Interest Swap Obligations entered into in the ordinary course of
business and otherwise in compliance with this Indenture; (v) Investments in
securities of trade creditors or customers received pursuant to any plan of
reorganization or similar arrangement upon the bankruptcy or insolvency of such
trade creditors or customers or in good faith settlement of delinquent
obligations of such trade creditors or customers; (vi) Investments made by the
Company or its Restricted Subsidiaries as a result of consideration received in
connection with an Asset Sale made in compliance with Section 4.10 hereof;
(vii) Investments existing on the Issue Date; (viii) accounts receivable
created or acquired in the ordinary course of business; (ix) guarantees by the
Company or a Restricted Subsidiary of the Company permitted to be incurred
under this Indenture; (x) additional Investments having an aggregate fair
market value, taken together with all other Investments made pursuant to this
clause (x) that are at that time outstanding, not to exceed the greater of (A)
$50.0 million and (B) 3.5% of the Company’s Total Assets provided that any investments in joint
ventures pursuant to this clause (x) will not exceed the greater of (A) $25.0
million and (B) 1.75% of the Company’s Total Assets; (xi) any Investment by the
Company or a Restricted Subsidiary of the Company in a Securitization Entity or
any Investment by a Securitization Entity in any other Person in connection
with a Qualified Securitization Transaction; provided that any Investment in a Securitization Entity
is in the form of a Purchase Money Note or an equity interest or interests in
receivables and related assets generated by the Company or a Restricted
Subsidiary and transferred to any Person in connection with a Qualified
Securitization Transaction or any such Person owning such receivables; (xii)
Investments the payment for which consists exclusively of Qualified Capital Stock
of the Company; (xiii) any Investment in any Person to the extent it consists
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; and (xiv) Investments in Unrestricted
Subsidiaries not to exceed $5.0 million at any one time outstanding.


 


“Permitted
Junior Securities” means unsecured debt or equity securities of the Company or
any Guarantor or any successor corporation issued pursuant to a plan of
reorganization or readjustment of the Company or any Guarantor, as applicable,
that are subordinated to the payment of all then outstanding Senior Debt of the
Company or any Guarantor, as applicable, at least to the same extent that the
Notes are subordinated to the payment of all Senior Debt of the Company or any
Guarantor, as applicable, on the Issue Date, so long as to the extent that any
Senior Debt of the Company or any Guarantor, as applicable, outstanding on the
date of consummation of any such plan of reorganization or readjustment is not
paid in full in cash on such date, the holders of any such Senior Debt not so
paid in full in cash have consented to the terms of such plan of reorganization
or readjustment.


 


“Permitted
Subsidiary Preferred Stock” means any series of Preferred Stock of a Foreign
Restricted Subsidiary that constitutes Qualified Capital Stock, the liquidation
value of all series of which, when combined with the aggregate amount of
outstanding Indebtedness of the Foreign Restricted Subsidiaries incurred
pursuant to clause (xv) of the definition of Permitted Indebtedness, does not
exceed $5.0 million.


 


“Person”
means an individual, partnership, corporation, limited liability company,
unincorporated organization, trust or joint venture, or a governmental agency
or political subdivision thereof.


 


21

















 


“PP
Acquisition Corporation” means PP Acquisition Corporation, a Delaware
corporation.


 


“Preferred
Stock” of any Person means any Capital Stock of such Person that has
preferential rights to any other Capital Stock of such Person with respect to
dividends or redemptions or upon liquidation or dissolution of such Person,
over shares of Capital Stock of any other class of such Person.


 


“Productive
Assets” means assets (including Capital Stock) that are used or usable by the
Company and its Restricted Subsidiaries in Permitted Businesses.


 


“Purchase
Money Note” means a promissory note of a Securitization Entity evidencing the
deferred purchase price of receivables (and related assets) and/or a line of
credit, which may be irrevocable, from the Company or any Restricted Subsidiary
of the Company in connection with a Qualified Securitization Transaction to a
Securitization Entity, which note shall be repaid from cash available to the
Securitization Entity other than amounts required to be established as reserves
pursuant to agreements, amounts paid to investors in respect of interest and
principal and amounts paid in connection with the purchase of newly generated
receivables or newly acquired equipment.


 


“Qualified
Capital Stock” means any Capital Stock that is not Disqualified Capital Stock.


 


“Qualified
Securitization Transaction” means any transaction or series of transactions
that may be entered into by the Company or any of its Restricted Subsidiaries
pursuant to which the Company or any of its Subsidiaries may sell, convey or
otherwise transfer to: (i) a Securitization Entity (in the case of a transfer
by the Company or any of its Restricted Subsidiaries); and (ii) any other
Person (in the case of a transfer by a Securitization Entity), or may grant a
security interest in any accounts receivable or equipment (whether now existing
or arising or acquired in the future) of the Company or any of its Restricted
Subsidiaries, and any assets related thereto including, without limitation, all
collateral securing such accounts receivable and equipment, all contracts and
contract rights and all guarantees or other obligations in respect of such
accounts receivable and equipment, proceeds of such accounts receivable and
equipment and other assets (including contract rights) which are customarily
transferred or in respect of which security interests are customarily granted
in connection with assets securitization transactions involving accounts
receivable and equipment.


 


“Refinance”
means, in respect of any security or Indebtedness, to refinance, extend, renew,
refund, repay, prepay, redeem, defease or retire, or to issue a security or Indebtedness
in exchange or replacement for, such security or Indebtedness in whole or in
part. “Refinanced” and “Refinancing” shall have correlative meanings.


 


“Refinancing
Indebtedness” means any Refinancing, modification, replacement, restatement,
refunding, deferral, extension, substitution, supplement, reissuance or resale
of existing or future Indebtedness (other than intercompany Indebtedness),
including any additional Indebtedness incurred to pay interest or premiums
required by the instruments governing such existing or future Indebtedness as
in effect at the time of issuance thereof (“Required Premiums”) and fees in
connection therewith; provided
that any such event shall not: (i) directly


 


22

















 


or
indirectly result in an increase in the aggregate principal amount of Permitted
Indebtedness, except to the extent such increase is a result of a simultaneous
incurrence of additional Indebtedness: (A) to pay Required Premiums and related
fees; or (B) otherwise permitted to be incurred under this Indenture; and (ii)
create Indebtedness with a Weighted Average Life to Maturity at the time such
Indebtedness is incurred that is less than the Weighted Average Life to
Maturity at such time of the Indebtedness being refinanced, modified, replaced,
renewed, restated, refunded, deferred, extended, substituted, supplemented,
reissued or resold; and (iii) if the Indebtedness being refinanced is
subordinated in right of payment to the Notes or the Guarantee, such Refinancing
Indebtedness is subordinated in right of payment to the Notes or the Guarantee
on terms at least as favorable to the holders as those contained in the
documentation governing the Indebtedness being extended, refinanced, renewed,
replaced, defeased or refunded.


 


“Registration
Rights Agreement” means the Registration Rights Agreement, dated as of the
Issue Date, among the Company, the Guarantors and the initial purchasers set
forth therein.


 


“Related
Party” with respect to any Permitted Holder means: (i)(A) any controlling
stockholder or a majority owned Subsidiary of such Permitted Holder or, in the
case of an individual, any spouse, sibling, parent or child of such Permitted
Holder; or (B) the estate of any Permitted Holder during any period in which
such estate holds Capital Stock of the Company for the benefit of any Person
referred to in clause (i)(A); or (ii) any trust, corporation, partnership,
limited liability company or other entity, the beneficiaries, stockholders,
partners, owners or Persons beneficially owning an interest of more than 50% of
which consist of, or the sole managing partner or managing member of which is,
one or more Permitted Holders and/or such other Persons referred to in the
immediately preceding clause (i).


 


“Representative”
means the indenture trustee or other trustee, agent or representative in
respect of any Designated Senior Debt; provided
that when used in connection with the Credit Facility, the term
“Representative” shall refer to the administrative agent under the Credit Facility;
provided  further, that if, and for so long as,
any Designated Senior Debt lacks such a representative, then the Representative
for such Designated Senior Debt shall at all times constitute the holders of a
majority in outstanding principal amount of such Designated Senior Debt in
respect of any Designated Senior Debt.


 


“Responsible
Officer,” when used with respect to the Trustee, means any officer within the
Corporate Trust Administration of the Trustee (or any successor group of the
Trustee) located at the Corporate Trust Office of the Trustee who has direct
responsibility for the administration of this Indenture and for the purposes of
Sections 7.01(c)(ii) and 7.05(b) also means, with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.


 


“Restricted
Subsidiary” of any Person means any Subsidiary of such Person which at the time
of determination is not an Unrestricted Subsidiary.


 


“S&P”
means Standard & Poor’s Ratings Group or any successor thereto.


 


“Sale
and Leaseback Transaction” means any direct or indirect arrangement with any
Person or to which any such Person is a party providing for the leasing to the
Company or a


 


23

















 


Restricted
Subsidiary of any property, whether owned by the Company or any Restricted
Subsidiary at the Issue Date or later acquired, which has been or is to be sold
or transferred by the Company or such Restricted Subsidiary to such Person or
to any other Person from whom funds have been or are to be advanced by such
Person on the security of such Property.


 


“SEC”
means the U.S. Securities and Exchange Commission.


 


“Secured
Debt” means any Indebtedness secured by a Lien.


 


“Securities
Act” means the Securities Act of 1933, as amended.


 


“Securitization
Entity” means a Wholly-Owned Subsidiary of the Company (or another Person in
which the Company or any Restricted Subsidiary of the Company makes an
Investment and to which the Company or any Restricted Subsidiary of the Company
transfers accounts receivable or equipment and related assets) which engages in
no activities other than in connection with the financing of accounts
receivable or equipment and which is designated by the Board of Directors of
the Company (as provided below) as a Securitization Entity:  (i) no portion of the Indebtedness or any
other Obligations (contingent or otherwise) of which: (A) is guaranteed by the
Company or any Restricted Subsidiary of the Company (excluding guarantees of
Obligations (other than the principal of, and interest on, Indebtedness)
pursuant to Standard Securitization Undertakings); (B) is recourse to or
obligates the Company or any Restricted Subsidiary of the Company in any way
other than pursuant to Standard Securitization Undertakings; or (C) subjects
any property or asset of the Company or any Restricted Subsidiary of the
Company, directly or indirectly, contingently or otherwise, to the satisfaction
thereof, other than pursuant to Standard Securitization Undertakings; (ii) with
which neither the Company nor any Restricted Subsidiary of the Company has any
material contract, agreement, arrangement or understanding (except in
connection with a Purchase Money Note or Qualified Securitization Transaction)
other than on terms no less favorable to the Company or such Restricted
Subsidiary than those that might be obtained at the time from Persons that are
not Affiliates of the Company, other than fees payable in the ordinary course
of business in connection with servicing receivables of such entity; and (iii)
to which neither the Company nor any Restricted Subsidiary of the Company has
any obligations to maintain or preserve such entity’s financial condition or
cause such entity to achieve certain levels of operating results.


 


Any
such designation by the Board of Directors of the Company shall be evidenced to
the Trustee by filing with the Trustee a certified copy of the Board Resolution
of the Company giving effect to such designation and an Officers’ Certificate
certifying that such designation complied with the foregoing conditions.


 


“Senior
Debt” means the principal of, premium, if any, and interest (including any
interest accruing subsequent to the filing of a petition of bankruptcy at the
rate provided for in the documentation with respect thereto, whether or not
such interest is an allowed claim under applicable law) on any Indebtedness of
the Company or any Guarantor, whether outstanding on the Issue Date or
thereafter created, incurred or assumed, unless, in the case of any particular
Indebtedness, the instrument creating or evidencing the same or pursuant to
which the same is outstanding expressly provides that such Indebtedness shall
be subordinate or pari passu in
right of payment to the Notes or the Guarantees, as the case may be.  Without limiting the generality


 


24

















 


of
the foregoing, “Senior Debt” shall also include the principal of, premium, if
any, interest (including any interest accruing subsequent to the filing of a
petition of bankruptcy at the rate provided for in the documentation with
respect thereto, whether or not such interest is an allowed claim under
applicable law) on, and all other amounts owing in respect of:  (x) all monetary obligations of every nature
of the Company or any Guarantor under the Credit Facility, including, without
limitation, obligations (including guarantees thereof) to pay principal and
interest, reimbursement obligations under letters of credit, fees, expenses and
indemnities; (y) all Interest Swap Obligations (and guarantees thereof); and
(z) all obligations (and guarantees thereof) under Currency Agreements and
Hedging Agreements, in each case whether outstanding on the Issue Date or thereafter
incurred.


 


Notwithstanding
the foregoing, “Senior Debt” shall not include (i) any Indebtedness of the
Company or a Guarantor to the Company or to a Subsidiary of the Company; (ii)
any Indebtedness of the Company or any Guarantor to, or guaranteed by the
Company or any Guarantor on behalf of, any shareholder, director, officer or
employee of the Company or any Subsidiary of the Company (including, without
limitation, amounts owed for compensation) other than a shareholder who is also
a lender (or an Affiliate of a lender) under the Credit Facilities (including
the Credit Facility); (iii) any amounts payable or other liability to trade
creditors arising in the ordinary course of business (including guarantees
thereof or instruments evidencing such liabilities but excluding secured
purchase money obligations and capitalized lease obligations); (iv)
Indebtedness represented by Disqualified Capital Stock; (v) any liability for
Federal, state, local or other taxes owed or owing by the Company or any of the
Guarantors; (vi) that portion of any Indebtedness incurred in violation of
Section 4.09 hereof (but, as to any such obligation, no such violation
shall be deemed to exist for purposes of this clause (vi) if the holder(s) of
such obligation or their representative and the Trustee shall have received an
Officers’ Certificate of the Company to the effect that the incurrence of such
Indebtedness does not (or in the case of revolving credit indebtedness, that
the incurrence of the entire committed amount thereof at the date on which the
initial borrowing thereunder is made would not) violate such provisions of this
Indenture); (vii) Indebtedness which, when incurred and without respect to any
election under Section 1111(b) of Title 11, United States Code, is without
recourse to the Company or any of the Guarantors, as applicable; and (viii) any
Indebtedness which is, by its express terms, subordinated or junior in right of
payment to any other Indebtedness, guarantee or obligation of the Company or
any of the Guarantors, including without limitation any Senior Subordinated
Debt.


 


“Senior
Subordinated Debt” means with respect to a Person, the Notes (in the case of
the Company), a Guarantee (in the case of a Guarantor) and any other
Indebtedness of such Person that specifically provides that such Indebtedness
is to rank pari passu with the
Notes or such Guarantee, as the case may be, in right of payment and is not
subordinated by its terms in right of payment to any Indebtedness or other
obligation of such Person which is not Senior Debt of such Person.


 


“Significant
Subsidiary,” with respect to any Person, means any Restricted Subsidiary of
such Person that satisfies the criteria for a “significant subsidiary” set
forth in Rule 1-02(w) of Regulation S-X under the Securities Act.


 


25

















 


“Standard
Securitization Undertakings” means representations, warranties, covenants and
indemnities entered into by the Company or any Restricted Subsidiary of the
Company which are reasonably customary, as determined in good faith by the
Board of Directors of the Company, in an accounts receivable or equipment
transaction.


 


“Stock
Purchase Agreement” means the stock purchase agreement dated as of
January 30, 2004, between PP Acquisition Corporation, Polypore, Inc. and
the sellers named therein, as such agreement may be further amended so long as
such amendments are not adverse to the Holders of the Notes.


 


“Stockholders’
Agreement” means the Stockholders’ Agreement, dated as of the Issue Date, among
PP Holding II and certain stockholders of PP Holding II as parties thereto, as
in effect on the Issue Date and as further amended and modified from time to
time, entered into in connection with the Transactions.


 


“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 Notes pursuant to a written agreement or pursuant to the terms
thereof.


 


“Subsidiary”
with respect to any Person, means: (i) any corporation, association or other
business entity (other than a partnership, joint venture, limited liability
company or similar entity) of which the outstanding Capital Stock having at
least a majority of the votes entitled to be cast in the election of directors,
managers or trustee thereof (or persons performing similar functions) under
ordinary circumstances shall at the time be owned, directly or indirectly, by
(1) such Person, (2) such Person and one or more Subsidiary of such Person or
(3) one or more Subsidiaries of such Person; or (ii) any partnership, joint
venture, limited liability company or similar entity of which at least a
majority of the capital accounts, distribution rights, total equity and voting
interest or general or limited partnership interests, as applicable, under
ordinary circumstances is at the time, directly or indirectly, owned by (1)
such Person, (2) such Person and one or more Subsidiary of such Person or (3)
one or more Subsidiaries of such Person.


 


 “TIA” means the Trust Indenture Act of 1939
(15 U.S.C. §§ 77aaa-77bbbb) as in effect on the date on which this
Indenture is qualified under the TIA.


 


“Total
Assets” means, as of any date, the total consolidated assets of the Company and
its Restricted Subsidiaries, as set forth on the Company’s most recently
available internal consolidated balance sheet as of such date.


 


“Transaction
Date” has the meaning set forth in the definition of Consolidated Fixed Charge
Coverage Ratio.


 


“Transactions”
means the merger of PP Acquisition Corporation with and into Polypore, Inc. and
the transactions related thereto occurring on the Issue Date, the offering of
the Notes being offered hereby and issued on the Issue Date and borrowings made
on the Issue Date pursuant to the Credit Facility.


 


“Treasury
Rate” means, as of the applicable redemption date, the yield to maturity as of
such redemption date of United States Treasury securities with a constant
maturity (as compiled


 


26

















 


and
published in the most recent Federal Reserve Statistical Release H.15 (519)
that has become publicly available at least two business days prior to such
redemption date (or, if such Statistical Release is no longer published, any
publicly available source of similar market data)) most nearly equal to the
period from such redemption date to May 15, 2008; provided, however, that if the period from such redemption
date to May 15, 2008 is less than one year, the weekly average yield on
actually traded United States Treasury securities adjusted to a constant
maturity of one year will be used.


 


“Trustee”
means the party named as such above until a successor replaces it in accordance
with the applicable provisions of this Indenture and thereafter means the
successor serving hereunder.


 


“U.S.
Dollar Equivalent” means, with respect to any monetary amount in a currency
other than U.S. dollars, at any time for the determination thereof, the amount
of U.S. dollars obtained by converting such foreign currency involved in such
computation into U.S. dollars at the spot rate for the purchase of U.S. dollars
with the applicable foreign currency as quoted by Reuters at approximately
10:00 A.M. (New York City time) on such date of determination (or if no such
quote is available on such date, on the immediately preceding business day for
which such a quote is available).


 


“U.S.
Government Obligations” means securities that are:


 


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


 


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


 


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


 


“U.S.
Subsidiary” means any Subsidiary of the Company that is incorporated under the
laws of the United States of America or any State thereof or the District of
Columbia.


 


“Unrestricted
Subsidiary” of any Person means: (i) any Subsidiary of such Person that at the
time of determination shall be or continue to be designated an Unrestricted
Subsidiary by the Board of Directors of such Person in the manner provided
below; and (ii) any Subsidiary of an Unrestricted Subsidiary.


 


27

















 


The
Board of Directors of the Company may designate any Subsidiary (including any
newly acquired or newly formed Subsidiary or a Person becoming a Subsidiary
through merger or consolidation or Investment therein) to be an Unrestricted
Subsidiary unless such Subsidiary owns any Capital Stock of or Indebtedness of
or has any Investment in, or owns 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 another Unrestricted Subsidiary; provided that: (i) the Company
certifies to the Trustee that such designation complies with Section 4.07
hereof; and (ii) each Subsidiary to be so designated and each of its
Subsidiaries: (A) has not at the time of designation, any Indebtedness pursuant
to which the lender has recourse to any of the assets of the Company or any of
its Restricted Subsidiaries, unless such recourse is Indebtedness or a Lien
that is permitted under this Indenture after giving effect to such designation;
and (B) either alone or in the aggregate with all other Unrestricted
Subsidiaries does not operate, directly or indirectly, all or substantially all
of the business of the Company and its Subsidiaries.


 


The
Board of Directors of the Company may designate any Unrestricted Subsidiary to
be a Restricted Subsidiary only if (x) immediately after giving effect to such
designation, the Company is able to incur at least $1.00 of additional
Indebtedness (other than Permitted Indebtedness) in compliance with
Section 4.09 hereof and (y) immediately before and immediately after
giving effect to such designation, no Default or Event of Default shall have
occurred and be continuing or would occur as a consequence thereof. Any such
designation by the Board of Directors of the Company shall be evidenced to the
Trustee by promptly filing with the Trustee a copy of the Board Resolution
giving effect to such designation and an Officers’ Certificate certifying that
such designation complied with the foregoing provisions.  If, at any time, any Unrestricted Subsidiary
would fail to meet the foregoing requirements as an Unrestricted Subsidiary, it
shall thereafter cease to be an Unrestricted Subsidiary for purposes of this
Indenture and any Indebtedness of such Subsidiary shall be deemed to be
incurred as of such date.


 


Actions
taken by an Unrestricted Subsidiary shall not be deemed to have been taken,
directly or indirectly, by the Company or any Restricted Subsidiary.


 


“Voting
Stock” of a corporation means all classes of Capital Stock of such corporation
then outstanding and normally entitled to vote in the election of directors.


 


“Weighted
Average Life to Maturity” means, when applied to any Indebtedness at any date,
the number of years obtained by dividing: 
(i) the then outstanding aggregate principal amount of such Indebtedness
into (ii) the sum of the total of the products obtained by multiplying:  (A) the amount of each then remaining
installment, sinking fund, serial maturity or other required payment of
principal, including payment at final maturity, in respect thereof; by (B) the
number of years (calculated to the nearest one-twelfth) which will elapse
between such date and the making of such payment.


 


“Wholly-Owned
Restricted Subsidiary” of any Person means any Wholly-Owned Subsidiary of such
Person which at the time of determination is a Restricted Subsidiary.


 


“Wholly-Owned
Subsidiary” of any Person means any Subsidiary of such Person of which all the
outstanding voting securities (other than in the case of a Restricted
Subsidiary that


 


28

















 


is
incorporated in a jurisdiction other than a State in the United States of
America or the District of Columbia, directors’ qualifying shares or an
immaterial amount of shares required to be owned by other Persons pursuant to
applicable law) are owned by such Person or any Wholly-Owned Subsidiary of such
Person.


 


                SECTION
1.02.  Other Definitions.


 


	
  Term

  	
   

  	
  Defined in Section

  
	
   

  	
   

  	
   

  
	
  “Acceleration
  Notice”

  	
   

  	
  6.02

  
	
  “Affiliate
  Transaction”

  	
   

  	
  4.11

  
	
  “Appendix”

  	
   

  	
  2.01

  
	
  “Authentication
  Order”

  	
   

  	
  2.02

  
	
  “Base
  Currency”

  	
   

  	
  13.13

  
	
  “Blockage
  Notice”

  	
   

  	
  10.03,
  12.03

  
	
  “Change
  of Control Offer”

  	
   

  	
  4.15

  
	
  “Change
  of Control Payment Date”

  	
   

  	
  4.15

  
	
  “Covenant
  Defeasance”

  	
   

  	
  8.03

  
	
  “Dollar
  Paying Agent”

  	
   

  	
  2.03

  
	
  “Euro
  Paying Agent”

  	
   

  	
  2.03

  
	
  “Event
  of Default”

  	
   

  	
  6.01

  
	
  “Guaranteed
  Obligations”

  	
   

  	
  11.01

  
	
  “incur”

  	
   

  	
  4.09

  
	
  “Initial
  Lien”

  	
   

  	
  4.12

  
	
  “Judgment
  Currency”

  	
   

  	
  13.13

  
	
  “Legal
  Defeasance”

  	
   

  	
  8.02

  
	
  “Luxembourg
  Paying Agent”

  	
   

  	
  2.03

  
	
  “Net
  Proceeds Offer”

  	
   

  	
  4.10

  
	
  “Net
  Proceeds Offer Amount”

  	
   

  	
  4.10

  
	
  “Net
  Proceeds Offer Payment Date”

  	
   

  	
  4.10

  
	
  “Net
  Proceeds Offer Trigger Date”

  	
   

  	
  4.10

  
	
  “Offer
  Period”

  	
   

  	
  3.09

  
	
  “pay
  the Notes”

  	
   

  	
  10.03

  
	
  “pay
  its Guarantee”

  	
   

  	
  12.03

  
	
  “Paying
  Agent”

  	
   

  	
  2.03

  
	
  “Payment
  Blockage Period”

  	
   

  	
  10.03,
  12.03

  
	
  “Payment
  Default”

  	
   

  	
  10.03,
  12.03

  
	
  “protected
  purchaser”

  	
   

  	
  2.07

  
	
  “Purchase
  Date”

  	
   

  	
  3.09

  
	
  “rate(s)
  of exchange”

  	
   

  	
  13.13

  
	
  “Reference
  Date”

  	
   

  	
  4.07

  
	
  “Registrar”

  	
   

  	
  2.03

  
	
  “Restricted
  Payment”

  	
   

  	
  4.07

  
	
  “Surviving
  Entity”

  	
   

  	
  5.01

  



 


 


29

















 


                SECTION 1.03.  Trust Indenture Act Definitions.


 


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


 


The
following TIA terms used in this Indenture have the following meanings:


 


“indenture
securities” means the Notes;


 


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


 


“indenture
to be qualified” means this Indenture;


 


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


 


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


 


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


 


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


 


(5)                                  provisions apply to successive events and
transactions;


 


(6)                                  “$” and “U.S. Dollars” each refer to United
States dollars, or such other money of the United States of America that at the
time of payment is legal tender for payment of public and private debts;


 


(7)                                  “€” and “Euros” each refer to the lawful
currency of the member states of the European Union that adopt the single
currency in accordance with the Treaty establishing the European Communities;


 


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


 


30

















 


(9)                                  references in this Indenture, in any context,
to any interest or other amount payable on or with respect to the Notes shall
be deemed to include any Additional Interest that is payable pursuant to the
Registration Rights Agreement.


 


ARTICLE 2



THE NOTES


 


                SECTION
2.01.  Form and Dating.


 


Provisions
relating to the Initial Notes and the Exchange Notes are set forth in the Rule
144A/Regulation S Appendix attached hereto (the “Appendix”) which is hereby
incorporated in and expressly made part of this Indenture.  The Initial Dollar Notes, the Initial Euro
Notes and the Trustee’s certificate of authentication with respect thereto
shall be substantially in the forms of Exhibit A and Exhibit B to the Appendix,
which is hereby incorporated in and expressly made a part of this
Indenture.  The Exchange Dollar Notes,
the Exchange Euro Notes and the Trustee’s certificate of authentication with
respect thereto shall be substantially in the forms of Exhibit C and Exhibit D
to the Appendix, which is hereby incorporated in and expressly made a part of
this Indenture.  The Notes 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 Note shall
be dated the date of its authentication. 
The terms of the Notes set forth in the Appendix and Exhibits A through
D to the Appendix are part of the terms of this Indenture.


 


                SECTION
2.02.  Execution and
Authentication.


 


On
the Issue Date, the Trustee shall authenticate and deliver (i) $225.0 million
of 83⁄4% Senior Subordinated Notes Due 2012 and (ii) €150.0 million of 83⁄4% Senior
Subordinated Notes due 2012 and, at any time and from time to time thereafter,
the Trustee shall authenticate and deliver Notes for original issue in an aggregate
principal amount specified in such order, in each case upon a written order of
the Company signed by two Officers or by an Officer and an Assistant Secretary
of the Company (each an “Authentication Order”).  Such order shall specify the amount of the Notes to be
authenticated and the date on which the original issue of Notes is to be
authenticated, whether the Notes are to be Initial Notes, Additional Notes or
Exchange Notes, or such other information as the Trustee shall reasonably
request and, in the case of an issuance of Additional Notes pursuant to
Section 2.14 after the Issue Date, shall certify that such issuance is in
compliance with Section 4.09.


 


The
Notes shall be issued only in registered form, without coupons and only in
denominations of $1,000 (in the case of Dollar Notes) and €1,000 (in the case
of Euro Notes) and any integral multiple thereof.


 


Two
Officers shall sign the Notes for the Company by manual or facsimile signature.


 


If
an Officer whose signature is on a Note no longer holds that office at the time
the Trustee authenticates the Note, the Note shall be valid nevertheless.


 


31

















 


A
Note shall not be valid until an authorized signatory of the Trustee manually
signs the certificate of authentication on the Note.  The signature shall be conclusive evidence that the Note has been
authenticated under this Indenture.


 


The
Trustee may appoint one or more authenticating agents reasonably acceptable to
the Company to authenticate the Notes. 
Unless limited by the terms of such appointment, an authenticating agent
may authenticate Notes whenever the Trustee may do so. Each reference in this
Indenture to authentication by the Trustee includes authentication by such
agent.  An authenticating agent has the
same rights as the Registrar, or any Paying Agent or agent for service of
notices and demands.


 


The
Trustee is hereby authorized to enter into a letter of representations with the
Depository or the Common Depository (as defined in the Appendix), as the case
may be, in the form provided by the Company and to act in accordance with such
letter.


 


                SECTION
2.03.  Registrar and Paying
Agent.


 


(a)  The Company shall maintain (i) an office or
agency where Notes may be presented for registration of transfer or for
exchange (the “Registrar”) (ii) an office or agency in the Borough of
Manhattan, the City of New York, the State of New York where Dollar Notes may
be presented for payment (the “Dollar Paying Agent”), (iii) an office or agency
in London, England where Euro Notes may be presented for payment (the “Euro
Paying Agent”) and (iv) so long as the Euro Notes are listed on the Luxembourg
Stock Exchange and if required by the rules of the Luxembourg Stock Exchange,
an office or agency in Luxembourg where Euro Notes may be presented for payment
(the “Luxembourg Paying Agent”).  The
Registrar shall keep a register of the Notes and of their registration of
transfer and exchange.  The Company may
have one or more co-registrars and one or more additional paying agents.  The term “Registrar” includes any
co-registrars.  The Company shall
maintain a co-registrar in London, England and, so long as the Euro Notes are
listed on the Luxembourg Stock Exchange and if required by the rules of the
Luxembourg Stock Exchange, in Luxembourg where Euro Notes may be presented for
registration of transfer or for exchange. 
The term “Paying Agent” includes the Dollar Paying Agent, the Euro
Paying Agent, the Luxembourg Paying Agent (if any) and any additional paying
agents.  The Company initially appoints
the Trustee as (i) Registrar and Dollar Paying Agent in connection with the
Notes and (ii) the Notes Custodian with respect to the Global Notes.  The Company initially appoints The Bank of
New York as co-registrar and Euro Paying Agent.


 


(b)                                 The Company shall enter into an appropriate
agency agreement with the Registrar or any Paying Agent not a party to this
Indenture, which shall incorporate the terms of the TIA; provided that any such agency
agreement with the Luxembourg Paying Agent need not incorporate the provisions
of the TIA.  The agency agreement shall
implement the provisions of this Indenture that relate to such agent.  The Company shall notify the Trustee in
writing of the name and address of any such agent.  If the Company fails to appoint or 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 or transfer agent.


 


32

















 


The
Registrar and Paying Agent shall be entitled to the rights and immunities of
the Trustee hereunder.


 


                SECTION
2.04.  Paying Agent to Hold
Money in Trust.


 


Prior
to each due date of the principal, premium, if any, and interest on any Note,
the Company shall deposit with each Paying Agent (or if the Company or a
Wholly-Owned Subsidiary is acting as Paying Agent, segregate and hold in trust
for the benefit of the Persons entitled thereto) a sum sufficient to pay such
principal, premium 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 Holders or the Trustee all money held by the Paying Agent for the
payment of principal of, premium, if any, or interest on the Notes and shall
notify the Trustee in writing of any default by the Company in making any such
payment.  While any such default
continues, the Trustee may require a Paying Agent to pay all money held by it
to the Trustee.  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 (if other than the Company or a Subsidiary of the
Company) shall have no further liability for the money delivered to the
Trustee.  Upon any bankruptcy or
reorganization proceedings relating to the Company, the Trustee shall serve as
Paying Agent for the Notes.


 


                SECTION
2.05.  Holder Lists.


 


The
Trustee shall preserve in as current a form as is reasonably practicable the
most recent list available to it of the names and addresses of Holders and
shall otherwise comply with TIA § 312(a). 
If the Trustee is not the Registrar, the Company shall furnish, or cause
the Registrar to furnish, to the Trustee, 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 Holders and the Company shall
otherwise comply with TIA §312(a).


 


                SECTION
2..06.  Transfer and Exchange.


 


(a)                                  The Notes shall be issued in registered form
and shall be transferable only upon the surrender of a Note being transferred
for registration of transfer and in compliance with the Appendix.  When a Note is presented to the Registrar
with a request to register a transfer, such Registrar shall register the transfer
as requested if the requirements of this Indenture and Section 8-401(a) of
the Uniform Commercial Code are met. 
When Notes are presented to the Registrar with a request to exchange
them for an equal principal amount of Notes of other denominations, the
Registrar shall make the exchange as requested if the same requirements are
met.


 


No
service charge shall be made for any registration of transfer or exchange or
redemption of the Notes, but the Company may require payment of a sum
sufficient to cover any transfer tax or similar governmental charge payable in
connection therewith (other than any such transfer taxes or other similar
governmental charge payable upon exchange or transfer pursuant to Sections
2.10, 3.06, 3.09, 4.10, 4.15 or 9.05 hereof).


 


33

















 


(b)                                 The Registrar shall not be required to
register the transfer of or exchange any Note selected for redemption in whole
or in part, except the unredeemed portion of any Note being redeemed in part.


 


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


 


(d)                                 The Company shall not be required (A) to
issue, to register the transfer of or to exchange any Notes during a period
beginning at the opening of business 15 days before the day of the mailing of
notice of redemption under Section 3.03 hereof and ending at the close of
business on such day, (B) to register the transfer of or to exchange any Note
so selected for redemption in whole or in part, except the unredeemed portion
of any Note being redeemed in part or (c) to register the transfer of or to
exchange a Note between a record date and the next succeeding Interest Payment
Date.


 


(e)                                  Any holder of a beneficial interest in a
Global Note shall, by acceptance of such beneficial interest, agree that
transfers of beneficial interests in such Global Note may be effected only
through a book-entry system maintained by (a) the holder of such Global Note
(or its agent or the person on whose behalf the Global Note is held) or (b) any
Holder of a beneficial interest in such Global Note, and that ownership of
beneficial interest in such Global Note shall be required to be reflected in a
book entry.


 


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


 


(g)                                 None of the Company, the Trustee, any agent
of the Company or the Trustee (including any Paying Agent or Registrar) will
have any responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial ownership interests of a global Note
or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.


 


(h)                                 The Trustee shall have no obligation or duty
to monitor, determine or inquire as to compliance with any restrictions on
transfer imposed under this Indenture or under applicable law with respect to
any transfer of any interest in any Note (including any transfers between or
among depositary participants or beneficial owners of interest 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.


 


 


34

















 


                SECTION
2.07.  Replacement Notes.


 


If
a mutilated Note is surrendered to the Registrar or if the Holder of a Note
claims that the Note has been lost, destroyed or wrongfully taken, the Company
shall issue and the Trustee shall authenticate a replacement Note if the
requirements of Section 8-405 of the Uniform Commercial Code are met, such
that the Holder (a) satisfies the Company or the Trustee within a reasonable
time after such Holder has notice of such loss, destruction or wrongful taking
and the Registrar does not register a transfer prior to receiving such
notification, (b) makes such request to the Company or the Trustee prior to the
Note being acquired by a protected purchaser as defined in Section 8-303
of the Uniform Commercial Code (a “protected purchaser”) and (c) satisfies any
other reasonable requirements of the Trustee. 
If required by the Trustee or the Company, such Holder shall furnish an
indemnity or a security bond sufficient in the judgment of the Trustee to
protect the Company, the Trustee, the Paying Agent and the Registrar from any
loss which any of them may suffer if a Note is replaced.  The Company and the Trustee may charge the
Holder for their expenses in replacing a Note.


 


Every
replacement Note is an additional obligation of the Company and shall be
entitled to all of the benefits of this Indenture equally and proportionally
with all other Notes duly issued hereunder.


 


The
provisions of this Section 2.07 are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, lost, destroyed or wrongfully taken Notes.


 


                SECTION
2.08.  Outstanding Notes.


 


Notes
outstanding at any time are all Notes authenticated by the Trustee except for
those canceled by it, those reductions in the interest in a Global Note
effected by the Trustee in accordance with the provisions of this Indenture,
those delivered to it for cancellation and those described in this
Section as not outstanding.  Except
as set forth in Section 2.09 hereof, a Note does not cease to be
outstanding because the Company or an Affiliate of the Company holds the Note.


 


If
a Note is replaced pursuant to Section 2.07 hereof (other than a mutilated
Note surrendered for replacement), it ceases to be outstanding unless the
Trustee and the Company receive proof satisfactory to them that the replaced
Note is held by a protected purchaser. 
A mutilated Note ceases to be outstanding upon surrender of such Note
and replacement thereof pursuant to Section 2.07.


 


If
the principal amount of any Note is considered paid under Section 4.01
hereof, it ceases to be outstanding and interest on it ceases to accrue.


 


If
the Paying Agent (other than the Company, a Subsidiary or an Affiliate of any
thereof) segregates and holds in trust, in accordance with this Indenture, on a
redemption date or maturity date money sufficient to pay all principal,
premium, if any, and interest payable on that date with respect to the Notes
(or portions thereof) to be redeemed or maturing, as the case may be, and no
Paying Agent is prohibited from paying such money to the Holders on that date
pursuant to the terms of this Indenture, then on and after that date such Notes
(or portions thereof) shall cease to be outstanding and interest on them shall
cease to accrue.


 


35

















 


                SECTION
2.09.  Treasury Notes.


 


In
determining whether the Holders of the required principal amount of Notes have
concurred in any direction, waiver or consent, Notes 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 considered as
though not outstanding, except that for the purposes of determining whether the
Trustee shall be protected in relying on any such direction, waiver or consent,
only Notes that the Trustee knows are so owned shall be so disregarded.


 


                SECTION
2.10.  Temporary Notes.


 


In
the event that Definitive Notes are to be issued under the terms of this
Indenture, until such Definitive Notes are ready for delivery, the Company may
prepare and the Trustee, upon receipt of an Authentication Order, shall
authenticate temporary Notes.  Temporary
Notes shall be substantially in the form of Definitive Notes but may have
variations that the Company considers appropriate for temporary Notes and as
shall be reasonably acceptable to the Trustee. 
Without unreasonable delay, the Company shall prepare and the Trustee
shall authenticate Definitive Notes and deliver them in exchange for temporary
Notes upon surrender of such temporary Notes at the office or agency of the
Company, without charge to the Holder. 
Until such exchange, temporary Notes shall be entitled to the same
rights, benefits and privileges as Definitive Notes and to all of the benefits
of this Indenture.


 


                SECTION
2.11.  Cancellation.


 


The
Company at any time may deliver Notes to the Trustee for cancellation.  The Registrar and the Paying Agent shall
forward to the Trustee any Notes surrendered to them for registration of
transfer, exchange or payment.  The
Trustee and no one else shall cancel (subject to the record retention
requirements of the Exchange Act) all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation in accordance with its
customary procedures and, if requested in writing, deliver a certificate of
such destruction to the Company unless the Company directs the Trustee in
writing to deliver canceled Notes to the Company.  The Company may not issue new Notes to replace Notes that it has
redeemed, paid or that have been delivered to the Trustee for cancellation.  The Trustee shall not authenticate Notes in
place of canceled Notes other than pursuant to the terms of this Indenture.


 


                SECTION
2.12.  Defaulted Interest.


 


If
the Company defaults in a payment of interest on the Dollar Notes or the Euro
Notes, the Company shall pay defaulted interest then borne by the Dollar Notes
or the Euro Notes, as the case may be (plus interest on such defaulted interest
at the applicable interest rate on the Notes to the extent lawful), in any
lawful manner.  The Company may pay the
defaulted interest to the Persons who are Holders 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 or cause to be
mailed to each affected Holder a notice that states the special record date,
the related payment date and the amount of defaulted interest to be paid.


 


36

















 


                SECTION
2.13.  CUSIP, ISIN or Common
Code Numbers.


 


The
Company in issuing the Notes may use “CUSIP”, “ISIN”, “Common Code” or other
similar identification numbers (if then generally in use) and, if so, the
Trustee shall use “CUSIP”, “ISIN”, “Common Code” or such other similar
identification numbers in notices of redemption or repurchase 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 Notes or as contained in
any notice of a redemption and that reliance may be placed only on the other
identification numbers printed on the Notes, and any such redemption shall not
be affected by any defect in or the omission of such numbers.  The Company shall promptly notify the
Trustee of any change in the “CUSIP”, “ISIN”, “Common Code” or such other
similar identification numbers.


 


                SECTION
2.14.  Issuance of Additional
Notes.


 


The
Company shall be entitled, subject to its compliance with Section 4.09, to
issue Additional Notes under this Indenture which shall have identical terms as
the Initial Notes issued on the Issue Date, other than with respect to the date
of issuance and issue price.  The
Initial Notes issued on the Issue Date, any Additional Notes and all Exchange
Notes issued in exchange therefor shall be treated as a single class for all
purposes under this Indenture.


 


With
respect to any Additional Notes, the Company shall set forth in a Board
Resolution and an Officers’ Certificate of the Company, a copy of each which
shall be delivered to the Trustee, the following information:


 


(1)                                  the aggregate principal amount of such
Additional Notes to be authenticated and delivered pursuant to this Indenture;


 


(2)                                  the issue price, the issue date and the
“CUSIP”, “ISIN”, “Common Code” or other similar identification numbers of such
Additional Notes; provided, however,
that no Additional Notes may be issued at a price that would cause such
Additional Notes to have “original issue discount” within the meaning of
Section 1273 of the Code; and


 


(3)                                  whether such Additional Notes shall be
Transfer Restricted Notes and issued in the form of Initial Notes as set forth
in the Appendix to this Indenture or shall be issued in the form of Exchange
Notes as set forth in Exhibit C or Exhibit D, as the case may be, to the
Appendix.


 


SECTION 2.15.  Calculation
of Amounts.  (a)  The aggregate principal amount of the Notes,
at any date of determination, shall be the sum of (1) the principal amount of
the Dollar Notes at such date of determination plus (2) the U.S. Dollar
Equivalent, at such date of determination, of the principal amount of the Euro
Notes at such date of determination. 
With respect to any matter requiring consent, waiver, approval or other
action of the Holders of a specified percentage of the principal amount of all
the Notes (and not solely the Dollar Notes or the Euro Notes as provided for in
the proviso to the third sentence of Section 9.02(d)), such percentage
shall be calculated, on the relevant date of determination, by dividing (x) the
principal amount, as of such date of determination, of Notes, the Holders of
which have so consented by (y) the aggregate principal


 


37

















 


amount,
as of such date of determination, of the Notes then outstanding, in each case,
as determined in accordance with the preceding sentence, Section 2.08 of
this Indenture.  Any such calculation
made pursuant to this Section 2.15(a) shall be made by the Company and
delivered to the Trustee pursuant to an Officers’ Certificate.


 


(b)                                 The maximum amount of Indebtedness,
Investments and other threshold amounts that the Company and its Restricted
Subsidiaries may incur shall not be deemed to be exceeded, with respect to any
outstanding Indebtedness, Investments and other threshold amounts solely as a
result of fluctuations in the exchange rate of currencies.  When calculating capacity for the incurrence
of additional Indebtedness, Investments and other threshold amounts by the
Company and its Restricted Subsidiaries, the exchange rate of currencies shall
be measured as of the date of such calculation.


 


ARTICLE 3



REDEMPTION AND PREPAYMENT


 


                SECTION
3.01.  Notices to Trustee.


 


If
the Company elects to redeem the Dollar Notes and/or the Euro Notes pursuant to
the optional redemption provisions of Section 3.07 hereof, it shall notify
the Trustee in writing of (i) the Section of this Indenture pursuant to
which the redemption shall occur, (ii) the redemption date, (iii) the principal
amount of Dollar Notes and/or Euro Notes to be redeemed, (iv) the redemption
price and (v) the “CUSIP”, “ISIN”, “Common Code” or other similar
identification numbers of the Notes to be redeemed.  The Company shall give notice to the Trustee provided for in this
paragraph at least 40 days but not more than 60 days before a redemption date
if the redemption is pursuant to Section 3.07 hereof, unless a shorter
period is acceptable to the Trustee. 
Such notice shall be accompanied by an Officers’ Certificate and Opinion
of Counsel from the Company to the effect that such redemption will comply with
the conditions herein.  If fewer than
all the Dollar Notes and/or Euro Notes are to be redeemed, the record date
relating to such redemption shall be selected by the Company and given to the
Trustee, which record date shall be not fewer than 15 days after the date of
notice to the Trustee.  Any such notice
may be canceled at any time prior to notice of such redemption being mailed to
any Holder and shall thereby be void and of no effect.


 


                SECTION
3.02.  Selection of Notes to
Be Redeemed.


 


If
less than all of the Notes are to be redeemed or purchased in an offer to
purchase at any time, the Trustee shall select the Notes to be redeemed or
purchased among the Holders of the Notes in compliance with the requirements of
the principal national securities exchange, if any, on which the Notes are
listed or, if the Notes are not so listed, on a pro rata basis, by lot or in
accordance with any other method the Trustee considers fair and
appropriate.  In the event of partial
redemption by lot, the particular Notes to be redeemed shall be selected,
unless otherwise provided herein, not less than 30 nor more than 60 days prior
to the redemption date by the Trustee from the outstanding Notes not previously
called for redemption.


 


38

















 


The
Trustee shall promptly notify the Company in writing of the Notes selected for
redemption and, in the case of any Note selected for partial redemption, the
principal amount to be redeemed. Notes and portions of Notes selected shall be
in amounts of $1,000 or whole multiples of $1,000 (in the case of Dollar Notes)
and in amounts of €1,000 or whole multiples of €1,000 (in the case of Euro
Notes). The provisions of this Indenture that apply to Notes called for
redemption also apply to portions of Notes called for redemption.


 


                SECTION
3.03.  Notice of Redemption.


 


Subject
to the provisions of Section 3.09 hereof, at least 30 days but not more
than 60 days before a redemption date, the Company shall mail or cause to be
mailed, by first class mail, a notice of redemption to each Holder whose Notes
are to be redeemed at its registered address.


 


The
notice shall identify the Dollar Notes and/or Euro Notes to be redeemed,
including “CUSIP”, “ISIN”, “Common Code” or other similar identification
numbers, if any, and shall state:


 


(a)                                  the redemption date;


 


(b)                                 the redemption price and the amount of
accrued interest to the redemption date;


 


(c)                                  if any Note is being redeemed in part, the
portion of the principal amount of such Note to be redeemed and that, after the
redemption date upon surrender of such Note, a new Note or Notes in principal
amount equal to the unredeemed portion shall be issued upon cancellation of the
original Note;


 


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


 


(e)                                  that Notes called for redemption must be
surrendered to the Paying Agent to collect the redemption price, plus accrued
interest;


 


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


 


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


 


(h)                                 that no representation is made as to the
correctness or accuracy of the “CUSIP”, “ISIN”, “Common Code” or other similar
identification number, if any, listed in such notice or printed on the Notes.


 


At
the Company’s request, the Trustee shall give the notice of redemption in the
Company’s name and at the Company’s expense; provided, however, that the Company shall have
delivered to the Trustee, at least 45 days prior to the redemption date, an
Officers’ Certificate requesting that the Trustee give such notice and setting forth
the information to be stated in such notice as provided in the preceding
paragraph.


 


39

















 


                SECTION
3.04.  Effect of Notice of
Redemption.


 


Once
notice of redemption is mailed in accordance with Section 3.03 hereof,
Notes called for redemption become irrevocably due and payable on the
redemption date at the redemption price stated in the notice. A notice of
redemption may not be conditional.  Upon
surrender to any Paying Agent, such Notes shall be paid at the redemption price
stated in the notice, plus accrued interest, to the redemption date; provided, however, that if the
redemption date is after a regular record date and on or prior to the interest
payment date, the accrued interest shall be payable to the Holder of the
redeemed Notes registered on the relevant record 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.


 


(a)                                  With respect to any Dollar Notes, prior to
10:00 a.m., New York City time, on the redemption date, the Company shall
deposit with the Dollar Paying Agent (or, if the Company or a Wholly-Owned
Subsidiary is a Paying Agent, shall segregate and hold in trust) money
sufficient to pay the redemption price of and accrued interest, on all Dollar
Notes or portions thereof to be redeemed on that date other than Dollar Notes
or portions of Dollar Notes called for redemption that have been delivered by
the Company to the Trustee for cancellation. 
On and after the redemption date, interest shall cease to accrue on
Dollar Notes or portions thereof called for redemption so long as the Company
has deposited with the Dollar Paying Agent funds sufficient to pay the
principal of, plus accrued and unpaid interest on, the Dollar Notes to be
redeemed, unless a Paying Agent is prohibited from making such payment pursuant
to the terms of this Indenture.


 


(b)                                 With respect to the Euro Notes, prior to
10:00 a.m., London time, on the redemption date, the Company shall deposit with
the Euro Paying Agent (or, if the Company or a Wholly-Owned Subsidiary is a
Paying Agent, shall segregate and hold in trust) money sufficient to pay the
redemption price of and accrued interest, on all Euro Notes or portions thereof
to be redeemed on that date other than Euro Notes or portions of Euro Notes
called for redemption that have been delivered by the Company to the Trustee
for cancellation.  On and after the redemption
date, interest shall cease to accrue on Euro Notes or portions thereof called
for redemption so long as the Company has deposited with the Euro Paying Agent
funds sufficient to pay the principal of, plus accrued and unpaid interest on,
the Euro Notes to be redeemed, unless the Euro Paying Agent is prohibited from
making such payment pursuant to the terms of this Indenture.


 


                SECTION
3.06.  Notes Redeemed in Part.


 


Upon
surrender of a Note that is redeemed in part, the Company shall issue and, upon
the Company’s written request, the Trustee shall authenticate for the Holder at
the expense of the Company a new Note equal in principal amount to the
unredeemed portion of the Note surrendered.


 


 


40

















 


                SECTION
3.07.  Optional Redemption;
Special Redemption.


 


(a)                                  Optional Redemption. 
Except as provided in Section 3.07(b), (c) and (d) hereof, the
Dollar Notes and the Euro Notes, in each case, shall not be redeemable at the
Company’s option prior to May 15, 2008. Thereafter, the Dollar Notes and the Euro
Notes, in each case, shall be subject to redemption at any time at the option
of the Company, in whole or in part, upon not less than 30 nor more than 60
days’ notice, at the redemption prices (expressed as percentages of principal
amount thereof) set forth below plus accrued and unpaid interest to the
applicable redemption date, if redeemed during the twelve month period
commencing on May 15 of the year set forth below:


 


Dollar
Notes


 


	
  Year

  	
   

  	
  Percentage
  of

  Principal Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2008

  	
   

  	
  104.375

  	
  %

  
	
  2009

  	
   

  	
  102.188

  	
  %

  
	
  2010 and thereafter

  	
   

  	
  100.000

  	
  %

  



 


Euro
Notes


 


	
  Year

  	
   

  	
  Percentage
  of

  Principal Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2008

  	
   

  	
  104.375

  	
  %

  
	
  2009

  	
   

  	
  102.188

  	
  %

  
	
  2010 and thereafter

  	
   

  	
  100.000

  	
  %

  



 


(b)                                 In addition, prior to May 15, 2008, the
Company may redeem the Dollar Notes and the Euro Notes, in each case, at its
option, in whole at any time or in part from time to time, upon not less than
30 nor more than 60 days’ prior notice mailed by first-class mail to each
Holder’s registered address, at a redemption price equal to 100% of the
principal amount of the Dollar Notes and the Euro Notes, as the case may be,
redeemed plus the Applicable Premium as of, and accrued and unpaid interest to,
the applicable redemption date (subject to the right of the Holders of record
on the relevant record date to receive interest due on the relevant interest
payment date).


 


(c)                                  Notwithstanding the foregoing, prior to May
15, 2007, the Company may at its option on one or more occasions redeem (x) the
Dollar Notes (which includes Additional Dollar Notes, if any) in an aggregate
principal amount not to exceed 35% of the aggregate principal amount of the
Dollar Notes (which includes Additional Dollar Notes, if any) originally issued
at a redemption price (expressed as a percentage of principal amount) of 108.75%,
and/or (y) the Euro Notes (which includes Additional Euro Notes, if any) in an
aggregate principal amount not to exceed 35% of the aggregate principal amount
of the Euro Notes (which includes Additional Euro Notes, if any) originally
issued at a redemption price (expressed as a percentage of principal amount) of
108.75%, in each case, plus accrued and unpaid interest to the redemption date,
with the net cash proceeds from one or more Equity Offerings; provided, however, that (1)


 


41

















 


(A)
at least 65% of such aggregate principal amount of Dollar Notes (which includes
Additional Dollar Notes, if any) and (B) at least 65% of such aggregate
principal amount of Euro Notes (which includes Additional Euro Notes, if any),
remains outstanding immediately after the occurrence of each such redemption
(other than Notes held, directly or indirectly, by the Company or its
Affiliates); and (2) each such redemption occurs within 60 days after the date
of the related Equity Offering.


 


(d)                                 Special Redemption. 
Notwithstanding the foregoing, in the event that the Transactions have
not been consummated on or prior to May 20, 2004, then the Company shall
mandatorily redeem all the Notes on or prior to May 21, 2004, at a redemption
price in cash equal to 100% of the issue price of the Notes plus accrued and
unpaid interest to the date of redemption. 
Notice of such redemption shall be given to the Trustee no later than
the close of business on May 20, 2004.


 


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


 


                SECTION
3.08.  Mandatory Redemption;
Open Market Purchases.


 


The
Company shall not be required to make any mandatory redemption or sinking fund
payments with respect to the Notes.  The
Company may at any time and from time to time purchase Notes in the open market
or otherwise.


 


                SECTION
3.09.  Offer to Purchase by
Application of Net Proceeds Offer Amount.


 


In
the event that, pursuant to Section 4.10 hereof, the Company shall be
required to commence a Net Proceeds Offer (as defined in Section 4.10
hereof), it shall follow the procedures specified below.


 


The
Net Proceeds Offer shall remain open for a period of 20 Business Days following
its commencement or such longer period as may be required by applicable law
(the “Offer Period”). No later than five Business Days after the termination of
the Offer Period (the “Purchase Date”), the Company shall purchase the Net
Proceeds Offer Amount or, if less than the Net Proceeds Offer Amount has been
tendered, all Notes tendered in response to the Net Proceeds Offer.  Payment for any Notes so purchased shall be
made in the same manner as interest payments are made.


 


If
the Purchase Date is on or after an interest record date and on or before the
related interest payment date, any accrued and unpaid interest shall be paid to
the Person in whose name a Note is registered at the close of business on such
record date, and no additional interest shall be payable to Holders who tender
Notes pursuant to the Net Proceeds Offer.


 


Upon
the commencement of a Net Proceeds Offer, the Company shall send, by first
class mail, a notice to the Trustee and each of the Holders, with a copy to the
Trustee. The notice shall contain all instructions and materials necessary to
enable such Holders to tender Notes pursuant to the Net Proceeds Offer. The Net
Proceeds Offer shall be made to all Holders. The notice, which shall govern the
terms of the Net Proceeds Offer, shall state:


 


42

















 


(a)                                  that the Net Proceeds Offer is being made
pursuant to this Section 3.09 and Section 4.10 hereof and the length
of time the Net Proceeds Offer shall remain open and, if the Net Proceeds Offer
is also made to holders of other Senior Subordinated Debt of the Company or a
Restricted Subsidiary of the Company pursuant to Section 4.10 hereof, the
notice shall identify such Senior Subordinated Debt and state that the Net
Proceeds Offer is also made to holders of such Senior Subordinated Debt;


 


(b)                                 the Net Proceeds Offer Amount, the purchase
price and the Purchase Date;


 


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


 


(d)                                 that, unless the Company defaults in making
such payment, any Note accepted for payment pursuant to the Net Proceeds Offer
shall cease to accrue interest after the Purchase Date;


 


(e)                                  that Holders electing to have a portion of a
Note purchased pursuant to a Net Proceeds Offer may only elect to have such
Note purchased in integral multiples of $1,000 (in the case of Dollar Notes)
and in integral multiples of €1,000 (in the case of Euro Notes);


 


(f)                                    that Holders electing to have a Note
purchased pursuant to any Net Proceeds Offer shall be required to surrender the
Note, with the form entitled “Option of Holder to Elect Purchase” on the
reverse of the Note completed, or transfer by book-entry transfer, to the
Company, a depositary, if appointed by the Company, or a Paying Agent at the
address specified in the notice at least three days before the Purchase Date;


 


(g)                                 that Holders shall be entitled to withdraw
their election if the Company, the depositary or the Paying Agent, as the case
may be, receives, not later than the expiration of the Offer Period, a
telegram, telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the Note the Holder delivered for purchase and
a statement that such Holder is withdrawing his election to have such Note
purchased;


 


(h)                                 that, if the aggregate principal amount of
Notes surrendered by Holders and other Senior Subordinated Debt surrendered by
the holders thereof exceeds the Offer Amount, the Company shall select the
Notes and other Senior Subordinated Debt of the Company or a Restricted
Subsidiary of the Company to be purchased on a pro rata basis (based on the
amounts of Notes and such other Senior Subordinated Debt tendered and with such
adjustments as may be deemed appropriate by the Company so that only Notes or
other Senior Subordinated Debt in denominations of $1,000 or integral multiples
thereof (in the case of Dollar Notes), and denominations of €1,000 or integral
multiples thereof (in the case of Euro Notes), shall be purchased); and


 


(i)                                     that Holders whose Notes were purchased only
in part shall be issued new Notes equal in principal amount to the unpurchased
portion of the Notes surrendered (or transferred by book-entry transfer).


 


On
or before the Purchase Date, the Company shall, to the extent lawful, accept
for payment, on a pro rata basis to the extent necessary, the Net Proceeds
Offer Amount of Notes


 


43

















 


and
other Senior Subordinated Debt of the Company or a Restricted Subsidiary of the
Company or portions thereof tendered pursuant to the Net Proceeds Offer, or if
less than the Net Proceeds Offer Amount has been tendered, all Notes and other
Senior Subordinated Debt of the Company or a Restricted Subsidiary of the
Company or portions thereof tendered, and shall deliver to the Trustee an
Officers’ Certificate stating that such Notes or such other Senior Subordinated
Debt or portions thereof were accepted for payment by the Company in accordance
with the terms of this Section 3.09. 
The Company, the Depository, the Common Depository or the Paying Agent,
as the case may be, shall promptly (but in any case not later than five days
after the Purchase Date) mail or deliver to each tendering Holder an amount
equal to the purchase price of the Notes tendered by such Holder and accepted
by the Company for purchase, and the Company shall promptly issue a new Note,
and the Trustee, upon written request from the Company shall authenticate and
mail or deliver such new Note to such Holder, in a principal amount equal to
any unpurchased portion of the Note surrendered. Any Note not so accepted shall
be promptly mailed or delivered by the Company to the Holder thereof. The
Company shall publicly announce the results of the Net Proceeds Offer on the
Purchase Date.


 


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


 


To
the extent that the provisions of any securities laws or regulations conflict
with this Section 3.09 or Section 4.10 hereof, the Company shall
comply with the applicable securities laws and regulations and shall not be deemed
to have breached its obligations under this Section 3.09 or
Section 4.10 hereof.


 


ARTICLE 4



COVENANTS


 


                SECTION
4.01.  Payment of Notes.


 


The
Company shall pay or cause to be paid the principal amount, premium, if any,
and interest on the Notes on the dates and in the manner provided in the Notes.
Principal amount, premium, if any, and interest shall be considered paid on the
date due if the Paying Agent, if other than the Company or a Subsidiary
thereof, holds as of 10:00 a.m. New York time, in the case of Dollar Notes and
as of 10:00 a.m. London time, in the case of Euro Notes on the due date money
deposited by the Company in immediately available funds and designated for and
sufficient to pay all principal amount, premium, if any, and interest then due.
The Company shall pay all Additional Interest, if any, in the same manner on
the same dates and in the amounts set forth in the Registration Rights
Agreement.


 


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


 


 


44

















 


                SECTION
4.02.  Maintenance of Office
or Agency.


 


(a)                                  The Company shall maintain in the Borough of
Manhattan, the City of New York, in London, England and, so long as the Euro
Notes are listed on the Luxembourg Stock Exchange and the rules of such stock
exchange so require, in Luxembourg, an office or agency (which may be an office
of the Trustee or an affiliate of the Trustee or any Registrar) where Notes may
be surrendered for registration of transfer or for exchange and where notices
and demands to or upon the Company in respect of the Notes and this Indenture
may be served. The Company shall give prompt written notice to the Trustee of
the location, and any change in the location, of such office or agency.  If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the
Trustee with the address thereof, such presentations, surrenders, notices and
demands may be made or served at the Corporate Trust Office of the Trustee.


 


(b)                                 The Company may also from time to time
designate one or more other offices or agencies where the Notes may be
presented or surrendered for any or all such purposes and may from time to time
rescind such designations; provided,
however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, the City of New York, in London, England and, so long as
the Euro Notes are listed on the Luxembourg Stock Exchange and the rules of
such stock exchange so require, in Luxembourg, for such purposes. The Company
shall give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or
agency.


 


(c)                                  The Company hereby designates the Corporate
Trust Office of the Trustee or its Agent, in the Borough of Manhattan, The City
of New York, and in London, England and the office of the Luxembourg Paying
Agent in Luxembourg, in each case, as such office or agency of the Company in
accordance with Section 2.03 hereof.


 


                SECTION
4.03.  Reports.


 


(a)                                  Whether or not required by the rules and
regulations of the SEC, so long as any Notes are outstanding, the Company shall
furnish to the Holders of Notes, if not filed electronically with the SEC (i)
all quarterly and annual financial information that would be required to be
contained in a filing with the SEC on Forms 10-Q and 10-K if the Company were
required to file such forms, including a “Management’s Discussion and Analysis
of Financial Condition and Results of Operations” that describes the financial
condition and results of operations of the Company and its consolidated
Subsidiaries (showing in reasonable detail, 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, the financial condition
and results of operations of the Company and its consolidated Subsidiaries)
and, with respect to the annual information only, a report thereon by the
Company’s certified independent accountants and (ii) all current reports that
would be required to be filed with the SEC on Form 8-K if the Company were
required to file such reports, in each case, within the time periods specified
in the SEC’s rules and regulations.  In
addition, following the consummation of the Registered Exchange Offer or the
effectiveness of the Shelf Registration Statement (as defined in the Appendix),
whether or not required by the rules and regulations of the SEC, the Company
shall file a copy of all such information and reports with the SEC for public
availability within the time periods specified in the SEC’s rules and
regulations (unless the SEC will not accept


 


45

















 


such
a filing) and make such information available to securities analysts and
prospective investors upon request. 
Notwithstanding the foregoing, such requirements shall be deemed
satisfied prior to the commencement of the Registered Exchange Offer or the
effectiveness of the Shelf Registration Statement by the filing when required
with the SEC of the Exchange Offer Registration Statement (as defined in the
Registration Rights Agreement) and/or Shelf Registration Statement, and any
amendments thereto, with such financial information that satisfies Regulation
S-X of the Securities Act.  The Company
shall at all times comply with TIA § 314(a).


 


(b)                                 For so long as any Notes remain outstanding,
the Company and the Guarantors shall furnish to the Holders and to securities
analysts and prospective investors, upon their request, the information
required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.


 


(c)                                  Should the Company deliver to the Trustee any
such information, reports or certificates or any annual reports, information,
documents and other reports pursuant to TIA § 314(a), delivery of such
information, reports or certificates or any annual reports, information,
documents and other reports to the Trustee is for informational purposes only
and the Trustee’s receipt of such shall not constitute constructive notice of
any information contained therein or determinable from information contained
therein, including the Company’s compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officers’
Certificates).


 


                SECTION
4.04.  Compliance Certificate.


 


(a)                                  The Company and each Guarantor (to the extent
that such Guarantor is so required under the TIA) shall deliver to the Trustee,
within 90 days after the end of each fiscal year, an Officers’ Certificate
stating that a review of the activities of the Company and its Subsidiaries
during the preceding fiscal year has been made under the supervision of the
signing Officers with a view to determining whether the Company has kept,
observed, performed and fulfilled its obligations under this Indenture, and
further stating, as to each such Officer signing such certificate, that to the
best of his or her knowledge the Company has kept, observed, performed and
fulfilled each and every covenant contained in this Indenture and is not in
default in the performance or observance of any of the terms, provisions and
conditions of this Indenture (or, if a Default or Event of Default shall have
occurred, describing all such Defaults or Events of Default of which he or she
may have knowledge and what action the Company is taking or proposes to take
with respect thereto) and that to the best of his or her knowledge no event has
occurred and remains in existence by reason of which payments on account of the
principal of or interest, if any, on the Notes is prohibited or if such event
has occurred, a description of the event and what action the Company is taking
or proposes to take with respect thereto. For purposes of this paragraph, such
compliance shall be determined without regard to any period of grace or
requirement of notice provided under this Indenture.  The Company also shall comply with Section 314(a)(4) of the
TIA.


 


(b)                                 The Company shall, so long as any of the
Notes are outstanding, deliver to the Trustee, forthwith upon any Officer
becoming aware of any Default or Event of Default, an


 


46

















 


Officers’
Certificate specifying such Default or Event of Default and what action the
Company is taking or proposes to take with respect thereto.


 


                SECTION
4.05.  [Intentionally Omitted].


 


                SECTION 4.06.  Stay, Extension and Usury Laws.


 


The
Company and each of the Guarantors covenants (to the extent that it may
lawfully do so) that it shall not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any stay,
extension or usury law wherever enacted, now or at any time hereafter in force,
that may affect the covenants or the performance of this Indenture; and the
Company and each of the Guarantors (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
that it 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 has been enacted.


 


                SECTION
4.07.  Restricted Payments.


 


The
Company shall not, and shall not cause or permit any of its Restricted
Subsidiaries to, directly or indirectly:


 


(1)                                  declare or pay any dividend or make any
distribution on or in respect of shares of the Company’s or any Restated
Subsidiary’s Capital Stock to holders of such Capital Stock, including any
payment in connection with any merger or consolidation involving the Company or
any of its Restricted Subsidiaries (other than dividends or distributions
payable in Qualified Capital Stock of the Company or in options, warrants or
other rights to purchase such Qualified Capital Stock dividends or
distributions payable to the Company or a Restricted Subsidiary and other than
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)                                  purchase, redeem or otherwise acquire or retire
for value any (i) Capital Stock of the Company (ii) Capital Stock of any direct
or indirect parent of the Company held by Persons other than the Company, (iii)
Capital Stock of a Restricted Subsidiary of the Company held by any Affiliate
of the Company (other than a Restricted Subsidiary of the Company) or (iv)
warrants, rights or options to purchase or acquire shares of any class of such
Capital Stock;


 


(3)                                  make any principal payment on, purchase,
defease, redeem, prepay, decrease or otherwise acquire or retire for value,
prior to any scheduled final maturity, scheduled repayment or scheduled sinking
fund payment, any Indebtedness of the Company, or of any Guarantor, that is
subordinate or junior in right of payment to the Notes or any Guarantee, as applicable
(other than the purchase, defeasance or other acquisition of such Indebtedness
purchased in anticipation of satisfying a sinking fund obligation, principal
installment or final maturity, in each case due within one year of such
purchase, defeasance or other acquisition); or


 


(4)                                  make any Investment (other than Permitted
Investments) (each of the foregoing actions set forth in clauses (1), (2), (3)
and (4) being referred to as a “Restricted Payment”);


 


47

















 


if
at the time of such Restricted Payment or immediately after giving effect
thereto:


 


(i)                                     a Default or an Event of Default shall have
occurred and be continuing (or would result therefrom); or


 


(ii)                                  the Company is not able to incur at least
$1.00 of additional Indebtedness (other than Permitted Indebtedness) in
compliance with Section 4.09 hereof; or


 


(iii)                               the aggregate amount of Restricted Payments
(including such proposed Restricted Payment) declared or made subsequent to the
Issue Date (other than Restricted Payments made pursuant to clauses (2), (3),
(4), (5), (6), (7), (8), (9), (10), (11), (12), (13), (15) and (16) of the
following paragraph) shall exceed the sum of, without duplication:


 


(v) 50% of the cumulative Consolidated Net Income
(or if cumulative Consolidated Net Income shall be a loss, minus 100% of such
loss) of the Company earned subsequent to April 3, 2004 and on or prior to
the date the Restricted Payment occurs (the “Reference Date”) (treating such
period as a single accounting period); provided,
however, that if, at the time of a proposed Restricted Payment under
this paragraph of this Section 4.07, the Consolidated Leverage Ratio of
the Company is less than 4.5 to 1, for purposes of calculating the availability
of amounts hereunder for such Restricted Payment only, the reference to 50% in
this clause (v) shall be deemed to be 75%; plus


 


(w) 100% of the aggregate net cash proceeds
(including the fair market value of property other than cash that would
constitute Marketable Securities or a Permitted Business) received by the
Company from any Person (other than (1) a Subsidiary of the Company and (2)
Excluded Contributions) from the issuance and sale subsequent to the Issue Date
and on or prior to the Reference Date of Qualified Capital Stock of the
Company; plus


 


(x) without duplication of any amounts included in
clause (iii)(w) above, 100% of the aggregate net cash proceeds of any equity
contribution received subsequent to the Issue Date by the Company from a holder
of the Company’s Capital Stock (other than Excluded Contributions) (excluding,
in the case of clauses (iii)(w) and this (iii)(x), any net cash proceeds from
an Equity Offering to the extent used to redeem the Notes in compliance with
the provisions set forth under Section 3.07(c) hereof); plus


 


(y) the amount by which Indebtedness of the Company
is reduced on the Company’s balance sheet upon the conversion or exchange
subsequent to the Issue Date of any Indebtedness of the Company for Qualified
Capital 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 exceed the net cash proceeds received by
the Company or any Restricted Subsidiary from the sale of such


 


48

















 


Indebtedness
(excluding net cash proceeds from sales to a Subsidiary of the Company or to an
employee stock ownership plan or a trust established by the Company or any of
its Subsidiaries for the benefit of their employees); plus


 


(z) an amount equal to the sum of (I) 100% of the
aggregate net proceeds (including the fair market value of property other than
cash that would constitute Marketable Securities or a Permitted Business)
received by the Company or any Restricted Subsidiary (A) from any sale or other
disposition of any Investment (other than a Permitted Investment) in any Person
(including an Unrestricted Subsidiary) made by the Company and its Restricted
Subsidiaries and (B) representing the return of capital or principal (excluding
dividends and distributions otherwise included in Consolidated Net Income) with
respect to such Investment, and (II) the portion (proportionate to the
Company’s equity interest in an Unrestricted Subsidiary) of the fair market
value of the net assets of an Unrestricted Subsidiary at the time such
Unrestricted Subsidiary is designated a Restricted Subsidiary; provided, however, that, in the
case of item (II), the foregoing sum shall not exceed, in the case of any
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 Unrestricted Subsidiary and; provided  further, that no
amount will be included under this clause (z) to the extent it is already
included in Consolidated Net Income.


 


Notwithstanding
the foregoing, the provisions set forth in the immediately preceding paragraph
shall not prohibit:


 


(1)                                  the payment of any dividend or the
consummation of any irrevocable redemption within 60 days after the date of
declaration of such dividend or notice of such redemption if the dividend or
payment of the redemption price, as the case may be, would have been permitted
on the date of declaration or notice;


 


(2)                                  any Restricted Payment made out of the net
cash proceeds of the substantially concurrent sale of, or made by exchange for,
Qualified Capital Stock of the Company (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 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 clauses (iii)(w) and (iii)(x) of the immediately preceding paragraph;


 


(3)                                  the acquisition of any Indebtedness of the
Company or a Guarantor that is subordinate or junior in right of payment to the
Notes or the applicable Guarantee through the application of net proceeds of a
substantially concurrent sale for cash (other than to a Subsidiary of the
Company) of Refinancing Indebtedness that is subordinate or junior in right of
payment to the Notes or the applicable Guarantee;


 


49

















 


(4)                                  if no Default or Event of Default shall have
occurred and be continuing or would occur as a consequence thereof, the
declaration and payment of dividends to holders of any class or series of
Designated Preferred Stock (other than Disqualified Capital Stock), issued after
the Issue Date; provided
that, at the time of the issuance of such stock, the Company, after giving
effect to such issuance on a pro forma basis, would have had a Consolidated
Fixed Charge Coverage Ratio of at least 2.0 to 1.0;


 


(5)                                  payments to Holdings for the purpose of
permitting, and in an amount equal to the amount required to permit, Holdings
to redeem or repurchase Holdings’ common equity or options in respect thereof,
in each case in connection with the repurchase provisions of employee stock option
or stock purchase agreements or other agreements to compensate management
employees or upon the death, disability, retirement, severance or termination
of employment of management employees; provided
that all such redemptions or repurchases pursuant to this clause (5) shall not
exceed in any fiscal year the sum of (A) $5.0 million plus (B) any amounts not
utilized in any preceding fiscal year following the Issue Date that were
otherwise available under this clause for such purchases (which aggregate amount
shall be increased by the amount of any net cash proceeds received from the
sale since the Issue Date of Capital Stock (other than Disqualified Capital
Stock) to members of the Company’s management team that have not otherwise been
applied to the payment of Restricted Payments pursuant to the terms of clause
(iii) of the immediately preceding paragraph or clause (2) of this paragraph
and by the cash proceeds of any “key-man” life insurance policies which are
used to make such redemptions or repurchases) plus (C) the amount of any cash
bonuses otherwise payable to members of management, directors or consultants of
the Company or any of its Subsidiaries or any of its direct or indirect parent
corporations in connection with the Transactions that are foregone in return
for the receipt of Equity Interests of the Company or any direct or indirect
parent corporation of the Company pursuant to a deferred compensation plan of
such corporation; provided, further,
that the cancellation of Indebtedness owing to the Company from members of
management of the Company or any of its Restricted Subsidiaries in connection
with any repurchase of Capital Stock of Holdings (or warrants or options or
rights to acquire such Capital Stock) will not be deemed to constitute a Restricted
Payment under this Indenture;


 


(6)                                  the making of distributions, loans or
advances Holdings to be used by Holdings solely (A) to pay its franchise taxes
and other fees required to maintain its corporate existence and (B) to pay for
operating expenses incurred by Holdings or any indirect parent of the Company
in the ordinary course of its business; provided,
however, that, in the case of clause (B), such distributions, loans
or advances shall not, in the aggregate, exceed $5.0 million per annum;


 


(7)                                  payments to Holdings, without duplication, in
respect of Federal, state and local taxes directly attributable to (or arising
as a result of) the operations of the Company and its consolidated Subsidiaries
and actually used by Holdings to pay such taxes; provided, however, that the amount of such
payments in any fiscal year do not exceed the amount that the Company and its
consolidated Subsidiaries would be required to pay in respect of Federal, state
and local taxes for such fiscal year were the Company to pay such taxes as a
stand-alone taxpayer;


 


50

















 


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


 


(9)                                  additional Restricted Payments in an
aggregate amount not to exceed $30.0 million;


 


(10)                            Permitted Acquisition Payments;


 


(11)                            payments of dividends on Disqualified Capital
Stock issued in compliance with Section 4.09 hereof;


 


(12)                            if no Default or Event of Default shall have
occurred and be continuing, Restricted Payments made with Net Cash Proceeds
from Asset Sales remaining after application thereof as required by
Section 4.10 hereof (including after the making by the Company of any Net
Proceeds Offer required to be made by the Company pursuant to such
Section and the application of the Net Proceeds Offer Amount to purchase
Notes tendered therein);


 


(13)                            upon occurrence of a Change of Control and
within 60 days after the completion of the Change of Control Offer pursuant to
Section 4.15 hereof (including the purchase of all Notes tendered), any
purchase or redemption of Obligations of the Company that are subordinate or
junior in right of payment to the Notes required pursuant to the terms thereof
as a result of such Change of Control at a purchase or redemption price not to
exceed 101% of the outstanding principal amount thereof, plus accrued and
unpaid interest thereon, if any; provided,
however, that (A) at the time of such purchase or redemption, no
Default or Event of Default shall have occurred and be continuing (or would
result therefrom), (B) the Company would be able to incur at least $1.00 of
additional Indebtedness (other than Permitted Indebtedness) in compliance with
Section 4.09 hereof after giving pro forma effect to such Restricted
Payment and (C) such purchase or redemption is not made, directly or
indirectly, from the proceeds of (or made in anticipation of) any issuance of
Indebtedness by the Company or any Subsidiary;


 


(14)                            so long as no Default has occurred and is
continuing or would be caused thereby, the payment of dividends on the
Company’s Common Stock (or dividends, distributions or advances to Holdings or
any other direct or indirect parent of the Company to allow Holdings or such
other direct or indirect parent to pay dividends on its Common Stock),
following the first public offering of the Company’s Common Stock (or of
Holdings’ or such other direct or indirect parent’s Common Stock, as the case
may be) after the date of the Indenture, of, whichever is earlier, (i) in the
case of the first public offering of the Company’s Common Stock, up to 6% per
annum of the Net Cash Proceeds received by the Company in such public offering
or (ii) in the case of the first public offering of Holdings’ or such other
direct or indirect parent’s Common Stock, up to 6% per annum of the amount
contributed by Holdings (or contributed directly or indirectly by such other
direct or indirect parent, as the case may be) to the Company from the Net Cash
Proceeds received by Holdings or such other direct or indirect parent in such
public offering;


 


(15)                            Investments that are made with Excluded
Contributions; and


 


51



















(16)                            payments to Holdings of fees and expenses
payable other than to Affiliates of Holdings related to any unsuccessful equity
or debt offering not prohibited by this Indenture.


 


In
determining the aggregate amount of Restricted Payments made subsequent to the
Issue Date in accordance with clause (iii) of the first paragraph of this
Section 4.07, (a) amounts expended pursuant to clauses (1) and (14) of the
immediately preceding paragraph shall be included in such calculation, and (b)
amounts expended pursuant to clauses (2), (3), (4), (5), (6), (7), (8), (9),
(10), (11), (12), (13), (15) and (16) of the immediately preceding paragraph
shall be excluded from such calculation.


 


The
Board of Directors of the Company may designate any Restricted Subsidiary of the
Company to be an Unrestricted Subsidiary as specified in the definition of
“Unrestricted Subsidiary”.  For purposes
of making such determination, all outstanding Investments by the Company and
its Restricted Subsidiaries (except to the extent repaid in cash) in the
Subsidiary so designated shall be deemed to be Restricted Payments at the time
of the designation and shall reduce the amount available for Restricted
Payments under the first paragraph of this Section 4.07.  All of those outstanding Investments shall
be deemed to constitute Investments in an amount equal to the fair market value
of the Investments at the time of such designation.  Such designation shall only be permitted if the Restricted
Payment would be permitted at the time and if the Restricted Subsidiary
otherwise meets the definition of an Unrestricted Subsidiary.


 


                SECTION 4.08.  Dividend and Other Payment Restrictions
Affecting Subsidiaries.


 


The
Company shall not, and shall not cause or permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause or permit to
exist or become effective any consensual encumbrance or consensual restriction
on the ability of any Restricted Subsidiary of the Company to: (a) pay
dividends or make any other distributions on or in respect of its Capital Stock
(it being understood that the priority of any Preferred Stock in receiving
dividends or liquidating distributions prior to dividends or liquidating
distributions being paid on Common Stock shall not be deemed a restriction on
the ability to make distributions on Capital Stock); (b) make loans or advances
or pay any Indebtedness or other obligation owed to the Company or any
Guarantor (it being understood that the subordination of loans or advances made
to the Company or any Guarantor to other Indebtedness incurred by the Company
or any Guarantor  shall not be deemed a
restriction on the ability to make loans or advances); or (c) transfer any of
its property or assets to the Company or any Guarantor, except, with respect to
clauses (a), (b) and (c), for such encumbrances or restrictions existing under
or by reason of: (1) applicable law; (2) this Indenture; (3) non-assignment
provisions of any contract or any lease of any Restricted Subsidiary of the
Company entered into in the ordinary course of business; (4) any instrument
governing Acquired Indebtedness, which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than
the Person or the properties or assets of the Person so acquired; (5) the
Credit Facility as entered into on the Issue Date or any amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings thereof; provided
that any restrictions imposed pursuant to any such amendment, modification,
restatement, renewal, increase, supplement, refunding, replacement or
refinancing are ordinary and customary with respect to syndicated bank loans
(under the relevant circumstances), as determined in good faith by the Company’s
Board of Directors, which determination will be conclusive; (6) agreements
existing on the Issue Date to the extent and in


 


52

















 


the
manner such agreements are in effect on the Issue Date; (7) restrictions on the
transfer of assets subject to any Lien permitted under this Indenture imposed
by the holder of such Lien; (8) restrictions imposed by any agreement to sell
assets or Capital Stock of a Restricted Subsidiary permitted under this
Indenture to any Person pending the closing of such sale; (9) any agreement or
instrument governing Capital Stock of any Person that is acquired; (10) any
Purchase Money Note or other Indebtedness or other contractual requirements of
a Securitization Entity in connection with a Qualified Securitization
Transaction, as determined in good faith by the Company’s Board of Directors,
which determination will be conclusive; provided
that such restrictions apply only to such Securitization Entity; (11) other
Indebtedness outstanding on the Issue Date or permitted to be issued or
incurred under this Indenture; provided
that any such restrictions are ordinary and customary with respect to the type
of Indebtedness being incurred (under the circumstances), as determined in good
faith by the Company’s Board of Directors, which determination will be
conclusive; (12) restrictions on cash or other deposits or net worth imposed by
customers under contracts entered into in the ordinary course of business; and
(13) any encumbrances or restrictions imposed by any amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or
refinancings of the contracts, instruments or obligations referred to in
clauses (1) through (4) and (6) through (12) above; provided that such amendments,
modifications, restatements, renewals, increases, supplements, refundings,
replacements or refinancings are, in the good faith judgment of the Company’s
Board of Directors (evidenced by a Board Resolution) whose judgment shall be
conclusively binding, not materially more restrictive with respect to such
dividend and other payment restrictions than those contained in the dividend or
other payment restrictions prior to such amendment, modification, restatement,
renewal, increase, supplement, refunding, replacement or refinancing.


 


                SECTION 4.09.  Incurrence of Indebtedness.


 


The
Company shall not, and shall not permit any of its Restricted Subsidiaries to,
directly or indirectly, create, incur, issue, assume, guarantee, acquire,
become liable, contingently or otherwise, with respect to, or otherwise become
responsible for payment of (collectively, “incur”) any Indebtedness (other than
Permitted Indebtedness); provided,
however, that if no Default or Event of Default shall have occurred
and be continuing at the time of or as a consequence of the incurrence of any
such Indebtedness, the Company and the Guarantors may incur Indebtedness
(including, Acquired Indebtedness), and Restricted Subsidiaries of the Company
that are not Guarantors may incur Acquired Indebtedness in an aggregate amount
not to exceed $20.0 million at any time outstanding, in each case if on the
date of the incurrence of such Indebtedness, after giving effect to the
incurrence thereof, the Consolidated Fixed Charge Coverage Ratio of the Company
would have been greater than 2.0 to 1.0. 
The maximum amount of Indebtedness that the Company and its Restricted
Subsidiaries may incur pursuant to this covenant shall not be deemed to be
exceeded, with respect to any outstanding Indebtedness, solely as a result of
fluctuations in the exchange rate of currencies.  When calculating capacity for the incurrence of additional
Indebtedness by the Company and its Restricted Subsidiaries pursuant to this
covenant the exchange rate of currencies shall be measured as of the date of
such calculation.


 


53

















 


                SECTION 4.10.  Asset Sales.


 


The
Company shall not, and shall not permit any of its Restricted Subsidiaries to,
consummate an Asset Sale unless: (i) the Company or the applicable Restricted
Subsidiary, as the case may be, receives consideration at the time of such
Asset Sale at least equal to the fair market value of the assets sold or
otherwise disposed of (as determined in good faith by the Company’s Board of
Directors), which determination will be conclusive; (ii) at least 75% of the
consideration received by the Company or the Restricted Subsidiary, as the case
may be, from such Asset Sale shall be in the form of cash or Cash Equivalents; provided, however, that the
amount of: (a) any liabilities (as shown on the Company’s or such Restricted
Subsidiary’s most recent balance sheet) of the Company or such Restricted
Subsidiary (other than liabilities that are by their terms subordinated to the
Notes) that are assumed by the transferee of any such assets; (b) any notes or
other obligations received by the Company or any such Restricted Subsidiary
from such transferee that are converted by the Company or such Restricted
Subsidiary into cash within 180 days of the receipt thereof (to the extent of
the cash received); and (c) any Designated Noncash Consideration received by
the Company or any of its Restricted Subsidiaries in such Asset Sale having an
aggregate fair market value, taken together with all other Designated Noncash
Consideration received pursuant to this clause (c) that is at that time
outstanding, not to exceed 5% of Total Assets at the time of the receipt of
such Designated Noncash Consideration (with the fair market value of each item
of Designated Noncash Consideration being measured at the time received and
without giving effect to subsequent changes in value), shall, in each of (a),
(b) and (c) above, be deemed to be cash for the purposes of this provision or
for purposes of the second paragraph of this Section 4.10; and (iii) upon
the consummation of an Asset Sale, the Company shall apply, or cause such
Restricted Subsidiary to apply, the Net Cash Proceeds relating to such Asset
Sale within 365 days of receipt thereof either (A) to prepay any Senior Debt,
or Indebtedness of a Restricted Subsidiary that is not a Guarantor and, in the
case of any such Indebtedness under any revolving credit facility, effect a
corresponding reduction in the availability under such revolving credit
facility (or effect a permanent reduction in the availability under such
revolving credit facility regardless of the fact that no prepayment is required
in order to do so (in which case no prepayment should be required)), (B) to
reinvest in Productive Assets (provided
that this requirement shall be deemed satisfied if the Company or such
Restricted Subsidiary by the end of such 365-day period has entered into a
binding agreement under which it is contractually committed to reinvest in
Productive Assets and such investment is consummated within 120 days from the
date on which such binding agreement is entered into and, with respect to the
amount of such investment, the reference to the 366th day after an Asset Sale
in the second following sentence shall be deemed to be a reference to the 121st
day after the date on which such binding agreement is entered into (but only if
such 121st day occurs later than such 366th day)), or (C) a combination of
prepayment and investment permitted by the foregoing clauses (iii)(A) and (iii)(B).  Pending the final application of any such
Net Cash Proceeds, the Company or such Restricted Subsidiary may temporarily
reduce Indebtedness under a revolving credit facility, if any, or otherwise
invest such Net Cash Proceeds in Cash Equivalents. On the 366th day after an
Asset Sale or such earlier date, if any, as the Board of Directors of the
Company or of such Restricted Subsidiary determines by Board Resolution not to
apply the Net Cash Proceeds relating to such Asset Sale as set forth in clauses
(iii)(A), (iii)(B) and (iii)(C) of the next preceding sentence (each, a “Net
Proceeds Offer Trigger Date”), such aggregate amount of Net Cash Proceeds which
have not been applied on or before such Net Proceeds Offer Trigger Date as
permitted in clauses (iii)(A), (iii)(B) and (iii)(C) of the next preceding
sentence (each a “Net Proceeds Offer Amount”) shall be applied by the Company


 


54

















 


or
such Restricted Subsidiary to make an offer to purchase (the “Net Proceeds
Offer”) on a date (the “Net Proceeds Offer Payment Date”) not less than 30 nor
more than 60 days following the applicable Net Proceeds Offer Trigger Date,
from all Holders and holders of any other Senior Subordinated Debt of the
Company or a Restricted Subsidiary requiring the making of such an offer, on a
pro rata basis, the maximum amount of Notes and such other Senior Subordinated
Debt that may be purchased with the Net Proceeds Offer Amount at a price equal
to 100% of their principal amount (or, in the event such other Senior
Subordinated Debt was issued with significant original issue discount, 100% of
the accreted value thereof), plus accrued and unpaid interest thereon, if any,
to the date of purchase (or, in respect of such other Senior Subordinated Debt,
such lesser price, if any, as may be provided for by the terms of such Senior
Subordinated Debt); provided,
however, that if at any time any non-cash consideration (including any
Designated Noncash Consideration) received by the Company or any Restricted
Subsidiary of the Company, as the case may be, in connection with any Asset
Sale is converted into or sold or otherwise disposed of for cash (other than
interest received with respect to any such non-cash consideration), then such
conversion or disposition shall be deemed to constitute an Asset Sale hereunder
and the Net Cash Proceeds thereof shall be applied in accordance with this
Section 4.10. Notwithstanding the foregoing, if a Net Proceeds Offer
Amount is less than $15.0 million, the application of the Net Cash Proceeds
constituting such Net Proceeds Offer Amount to a Net Proceeds Offer may be
deferred until such time as such Net Proceeds Offer Amount plus the aggregate
amount of all Net Proceeds Offer Amounts arising subsequent to the Net Proceeds
Offer Trigger Date relating to such initial Net Proceeds Offer Amount from all
Asset Sales by the Company and its Restricted Subsidiaries aggregates at least
$15.0 million, at which time the Company or such Restricted Subsidiary shall
apply all Net Cash Proceeds constituting all Net Proceeds Offer Amounts that
have been so deferred to make a Net Proceeds Offer (the first date the
aggregate of all such deferred Net Proceeds Offer Amounts is equal to $15.0
million or more shall be deemed to be a Net Proceeds Offer Trigger Date).


 


Notwithstanding
the immediately preceding paragraph, the Company and its Restricted
Subsidiaries shall be permitted to consummate an Asset Sale without complying
with such paragraph to the extent that: (i) at least 75% of the consideration
for such Asset Sale constitutes Productive Assets, cash, Cash Equivalents
and/or Marketable Securities; and (ii) such Asset Sale is for fair market
value; provided that any
consideration consisting of cash, Cash Equivalents and/or Marketable Securities
received by the Company or any of its Restricted Subsidiaries in connection
with any Asset Sale permitted to be consummated under this paragraph shall
constitute Net Cash Proceeds subject to the provisions of the preceding
paragraph.


 


Notice
of each Net Proceeds Offer will be mailed to the record Holders as shown on the
register of Holders within 30 days following the Net Proceeds Offer Trigger
Date, with a copy to the Trustee, and shall comply with the procedures set
forth in Section 3.09 hereof.  To
the extent that the aggregate amount of Notes and other Senior Subordinated
Debt tendered pursuant to a Net Proceeds Offer is less than the Net Proceeds
Offer Amount, the Company may use any remaining Net Proceeds Offer Amount for
general corporate purposes or for any other purpose not prohibited by this
Indenture. Upon completion of any such Net Proceeds Offer, the Net Proceeds
Offer Amount shall be reset at zero.


 


The
Company shall comply with the requirements of Rule 14e-1 under the Exchange Act
and any other securities laws and regulations thereunder to the extent such
laws and regulations


 


55

















 


are
applicable in connection with the repurchase of Notes pursuant to a Net
Proceeds Offer. To the extent that the provisions of any securities laws or
regulations conflict with the provisions of this Section 4.10, the Company
shall comply with the applicable securities laws and regulations and shall not
be deemed to have breached its obligations under this Section 4.10 by
virtue thereof.


 


                SECTION 4.11.  Transactions with Affiliates.


 


(a)                                  The Company shall not, and shall not permit
any of its Restricted Subsidiaries to, directly or indirectly, enter into or
permit to occur any transaction or series of related transactions (including,
without limitation, the purchase, sale, lease or exchange of any property or
the rendering of any service) with, or for the benefit of, any of its
Affiliates involving aggregate consideration in excess of $3.0 million (an
“Affiliate Transaction”), other than Affiliate Transactions on terms that are
not materially less favorable than those that might reasonably have been
obtained in a comparable transaction at such time on an arm’s-length basis from
a Person that is not an Affiliate of the Company; provided, however, that for a transaction or
series of related transactions with an aggregate value of $10.0 million or
more, at the Company’s option, either: (i) a majority of the disinterested
members of the Board of Directors of the Company shall determine in good faith
that such Affiliate Transaction is on terms that are not materially less
favorable than those that might reasonably have been obtained in a comparable
transaction at such time on an arm’s-length basis from a Person that is not an
Affiliate of the Company, or (ii) the Board of Directors of the Company or any
such Restricted Subsidiary party to such Affiliate Transaction shall have
received an opinion from a nationally recognized investment banking, appraisal
or accounting firm that such Affiliate Transaction is either fair, from a
financial standpoint, to the Company and its Restricted Subsidiaries or is on
terms not materially less favorable than those that might reasonably have been
obtained in a comparable transaction at such time on an arm’s-length basis from
a Person that is not an Affiliate of the Company; and provided, further, that for an
Affiliate Transaction with an aggregate value of $20.0 million or more the
Board of Directors of the Company or any such Restricted Subsidiary party to
such Affiliate Transaction shall have received a written opinion from a
nationally recognized investment banking, appraisal or accounting firm that
such Affiliate Transaction is either fair, from a financial standpoint, to the
Company and its Restricted Subsidiaries or is on terns not materially less
favorable than those that might reasonably have been obtained in a comparable
transaction at such time on an arm’s-length basis from a Person that is not an
Affiliate of the Company.


 


(b)                                 The restrictions set forth in
Section 4.11(a) hereof shall not apply to: (i) reasonable fees and
compensation paid to, and indemnity provided on behalf of, officers, directors,
employees or consultants of the Company or any Restricted Subsidiary of the
Company as determined in good faith by the Company’s Board of Directors or
senior management; (ii) transactions exclusively between or among the Company
and any of its Restricted Subsidiaries or any entity that becomes a Restricted
Subsidiary as a result of such transaction (other than a Securitization Entity)
or exclusively between or among such Restricted Subsidiaries or any entity that
becomes a Restricted Subsidiary as a result of such transaction, provided that such transactions are
not otherwise prohibited by this Indenture; (iii) any agreement as in effect as
of the Issue Date or any amendment thereto or any transaction contemplated
thereby (including pursuant to any amendment thereto) or by any replacement


 


56

















 


agreement
thereto so long as any such amendment or replacement agreement is not more
disadvantageous to the Holders in any material respect than the original
agreement as in effect on the Issue Date as determined in good faith by the
Board of Directors of Company; (iv) Restricted Payments or Permitted
Investments permitted by this Indenture; (v) transactions effected as part of a
Qualified Securitization Transaction; (vi) the payment of customary annual
management, consulting and advisory fees and related expenses to the Permitted
Holders and their Affiliates made pursuant to any financial advisory,
financing, underwriting or placement agreement or in respect of other
investment banking activities, including, without limitation, in connection
with acquisitions or divestitures which are approved by the Board of Directors
of the Company or such Restricted Subsidiary in good faith; (vii) payments or
loans allowed by law to employees or consultants that are approved by the Board
of Directors of the Company in good faith; (viii) sales of Qualified Capital
Stock; (ix) the existence of, or the performance by the Company or any of its
Restricted Subsidiaries of its obligations under the terms of, any
stockholders’ agreement (including any registration rights agreement or
purchase agreement related thereto) to which it is a party as of the Issue Date
and any similar agreements which it may enter into thereafter; provided, however, that the
existence of, or the performance by the Company or any of its Restricted Subsidiaries
of obligations under, any future amendment to any such existing agreement or
under any similar agreement entered into after the Issue Date shall only be
permitted by this clause (ix) to the extent that the terms of any such
amendment or new agreement are not disadvantageous to the Holders of Notes in
any material respect; (x) transactions permitted by, and complying with, the
provisions of Article 5 and Section 11.06 hereof; (xi) any issuance
of securities or other payments, awards, grants in cash, securities or
otherwise pursuant to, or the funding of, employment arrangements, stock
options and stock ownership plans approved by the Board of Directors of the
Company; (xii) transactions in which the Company or any Restricted Subsidiary
delivers to the Trustee a letter from a nationally recognized investment
banking, appraisal or accounting firm stating that such transaction is fair to
the Company or such Restricted Subsidiary from a financial point of view; and
(xiii) transactions with customers, clients, suppliers, or purchasers or
sellers of goods or services, in each case in the ordinary course of business
and otherwise in compliance with the terms of this Indenture that are fair to
the Company or the Restricted Subsidiaries, in the reasonable determination of
the members of the Board of Directors of the Company, which determinations
shall be conclusive, or are on terms at least as favorable as might reasonably
have been obtained at such time from an unaffiliated party.


 


                SECTION 4.12.  Liens.


 


The
Company shall not, and shall not cause or permit any Guarantor to, incur any
Secured Debt that is not senior debt of such Person, unless contemporaneously
therewith such Person makes effective provision to secure the Notes or the
relevant Guarantee, as applicable, equally and ratably with such Secured Debt
for so long as such Secured Debt is secured by a Lien (the “Initial
Lien”).  Any Lien created for the
benefit of the Holders of the Notes pursuant to the preceding sentence shall
provide by its terms that such Lien shall be automatically and unconditionally
released and discharged upon the release and discharge of the Lien securing the
other Secured Debt and that holders of such other Secured Debt may exclusively
control the disposition of property subject to the Initial Lien.


 


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                SECTION 4.13.  Conduct of Business.


 


The
Company shall not, and shall not permit any of its Restricted Subsidiaries to,
engage in any businesses a majority of whose revenues are not derived from
businesses that are the same or reasonably similar, ancillary or related to, or
a reasonable extension, development or expansion of, the businesses in which
the Company and its Restricted Subsidiaries are engaged on the Issue Date
(which shall include, without limitation, business or operations of the
Company’s suppliers and customers). 
Holdings shall not engage in any business other than managing its
investment in the Company and any business incidental thereto (including
issuing securities to finance such investment).


 


                SECTION 4.14.  Corporate Existence.


 


Subject
to Article 5 and Section 11.06 hereof, the Company shall do or cause
to be done all things necessary to preserve and keep in full force and effect
(i) its corporate existence, and the corporate, partnership or other existence
of each of its Restricted Subsidiaries, in accordance with the respective
organizational documents (as the same may be amended from time to time) of the
Company or any such Restricted Subsidiary and (ii) the rights (charter and
statutory), licenses and franchises of the Company and its Restricted
Subsidiaries; provided, however,
that the Company shall not be required to preserve any such right, license or
franchise, or the corporate, partnership or other existence of any of its
Restricted Subsidiaries, if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and its Restricted Subsidiaries, taken as a whole, and that the
loss thereof would not have an adverse effect on the ability of the Company to
perform its obligations under the Notes or this Indenture.


 


                SECTION 4.15.  Offer to Repurchase upon Change of
Control.


 


(a)                                  If a Change of Control occurs, each Holder
shall have the right to require the Company to purchase all or a portion of
such Holder’s Notes pursuant to the offer described below (the “Change of
Control Offer”), at a purchase price equal to 101% of the principal amount
thereof plus accrued interest to the date of purchase.  Within 30 days following the date upon which
the Change of Control occurred, the Company must send, by first class mail, a
notice to the Trustee and each Holder and, so long as the Notes are listed on
the Luxembourg Stock Exchange, publish such notice in a Luxembourg newspaper of
general circulation, which notice shall govern the terms of the Change of
Control Offer. Such notice shall state, among other things, the purchase date,
which must be no earlier than 30 days nor later than 60 days from the date such
notice is mailed, other than as may be required by law (the “Change of Control
Payment Date”). Holders electing to have a Dollar Note or Euro Note purchased
pursuant to a Change of Control Offer shall be required to surrender the Dollar
Note or Euro Note, as the case may be, with the form entitled “Option of Holder
to Elect Purchase” on the reverse of the Dollar Note or Euro Note, as the case
may be, completed, to the Dollar Paying Agent or Euro Paying Agent as the case
may be, at the address specified in the notice prior to the close of business
on the third Business Day prior to the Change of Control Payment Date.


 


(b)                                 On the Change of Control Payment Date, the
Company shall, to the extent lawful, (1) accept for payment all Notes or
portions thereof properly tendered pursuant to the Change of Control Offer, (2)
deposit with the Dollar Paying Agent or Euro Paying Agent, as the case may be,
an amount equal to the Change of Control Payment in respect of all Notes or
portions thereof


 


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so
tendered and (3) deliver or cause to be delivered to the applicable Trustee the
Notes so accepted together with an Officers’ Certificate stating the aggregate
principal amount of Dollar Notes or Euro Notes or portions thereof being
purchased by the Company. The Paying Agent shall promptly mail to each Holder
of Notes so tendered the Change of Control Payment for such Notes, and the
Trustee shall promptly authenticate and mail or deliver (or cause to be
transferred by book entry) to each Holder a new Note equal in principal amount
to any unpurchased portion of the Notes surrendered, if any; provided that each such new Note will
be in a principal amount of $1,000 or an integral multiple thereof (in the case
of Dollar Notes) or in a principal amount of €1,000 or an integral multiple
thereof (in the case of Euro Notes). 
The Company shall publicly announce the results of the Change of Control
Offer on or as soon as practicable after the Change of Control Payment Date.


 


Prior
to the mailing of the notice referred to in Section 4.15(a) above, but in
any event within 30 days following any Change of Control, the Company shall:
(i) repay in full all Indebtedness under the Credit Facility and all other
Senior Debt the terms of which require repayment upon a Change of Control; or
(ii) obtain the requisite consents under the Credit Facility and all such other
Senior Debt to permit the repurchase of the Notes as provided below. The
Company’s failure to comply with the covenant described in the immediately
preceding sentence shall constitute an Event of Default described in clause (c)
and not in clause (b) under Section 6.01 hereof.


 


(c)                                  The Company shall comply with the
requirements of Rule 14e-1 under the Exchange Act to the extent such laws and
regulations are applicable in connection with the repurchase of Notes pursuant
to a Change of Control Offer. To the extent that the Company complies with the
provisions of any such securities laws or regulations, the Company shall not be
deemed to have breached its obligations under this Section 4.15.


 


(d)                                 Notwithstanding anything to the contrary in
this Section 4.15, the Company shall not be required to make a Change of
Control Offer upon a Change of Control if a third party makes the Change of
Control Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Section 4.15 hereof and purchases all Notes
validly tendered and not withdrawn under such Change of Control Offer.


 


                SECTION 4.16.  No Senior Subordinated Debt.


 


The
Company shall not, and shall not permit any Guarantor to, incur or suffer to
exist Indebtedness that is senior in right of payment to the Notes or such
Guarantor’s Guarantee, as the case may be, and subordinate in right of payment
to any other Indebtedness of the Company or such Guarantor, as the case may be;
provided that the
foregoing does not prohibit subordination of Liens among holders of Senior
Debt.


 


                SECTION 4.17.  Future Guarantees by Domestic
Subsidiaries.


 


At
any time at which (i) the Company’s Credit Facilities require a guarantee of
any of the Domestic Subsidiaries or (ii) the Domestic Subsidiaries have
aggregate Indebtedness outstanding of $75.0 million or more owed to Persons
other than the Company or any Restricted Subsidiary, the Company shall cause
each of its Domestic Subsidiaries to execute and deliver a supplemental


 


59

















 


indenture
to the Indenture, providing for a senior subordinated guarantee of payment of
the Notes by such Domestic Subsidiary; provided,
however, that such Domestic Subsidiary need not execute and deliver
such a supplemental indenture for so long as such Domestic Subsidiary has Total
Assets of $10,000 or less, total Indebtedness of $10,000 or less and does not
own any of the material Intellectual Property of the Company and its
Subsidiaries.


 


                SECTION 4.18.  Limitation on Preferred Stock of
Restricted Subsidiaries.


 


The
Company shall not permit any of its Restricted Subsidiaries to issue any
Preferred Stock (other than to the Company or to a Restricted Subsidiary of the
Company) or permit any Person (other than the Company or a Restricted
Subsidiary of the Company) to own any Preferred Stock of any Restricted
Subsidiary of the Company, other than Permitted Subsidiary Preferred Stock. The
provisions of this Section 4.18 will not apply to (w) any of the
Guarantors for so long as such Restricted Subsidiary remains a Guarantor, (x)
any transaction as a result of which neither the Company nor any of its Restricted
Subsidiaries will own any Capital Stock of the Restricted Subsidiary whose
Preferred Stock is being issued or sold and (y) Preferred Stock (including
Disqualified Capital Stock) that is issued in compliance with Section 4.09
hereof.


 


ARTICLE 5



SUCCESSORS


 


                SECTION 5.01.  Merger, Consolidation, or Sale of Assets.


 


The
Company shall not, in a single transaction or series of related transactions,
consolidate or merge with or into any Person, or sell, assign, transfer, lease,
convey or otherwise dispose of (or cause or permit any Restricted Subsidiary of
the Company to sell, assign, transfer, lease, convey or otherwise dispose of)
all or substantially all of the Company’s assets (determined on a consolidated
basis for the Company and the Company’s Restricted Subsidiaries) to any Person
unless (i) either: (a) the Company shall be the surviving or continuing
corporation; or (b) the Person (if other than the Company) formed by such
consolidation or into which the Company is merged or the Person which acquires by
sale, assignment, transfer, lease, conveyance or other disposition the
properties and assets of the Company and of the Company’s Restricted
Subsidiaries substantially as an entirety (the “Surviving Entity”): (x) shall
be a corporation organized and validly existing under the laws of the United
States of America or any State thereof or the District of Columbia; and (y)
shall expressly assume, by supplemental indenture (in form and substance
satisfactory to the Trustee), executed and delivered to the Trustee, the due
and punctual payment of the principal of, premium, if any, and interest on all
of the Notes and the performance of every covenant and all obligations of the
Company under the Notes, this Indenture and the Registration Rights Agreement
to be performed or observed on the part of the Company; (ii) except in the case
of a merger of the Company with or into a Wholly-Owned Restricted Subsidiary of
the Company and except in the case of a merger entered into solely for the
purpose of reincorporating the Company in another jurisdiction, immediately
after giving effect to such transaction and the assumption contemplated by
clause (i)(b)(y) above (including giving effect to any Indebtedness and
Acquired Indebtedness incurred in connection with or in respect of such
transaction), the Company or such Surviving Entity, as the case may be, shall
be able to incur at least $1.00 of


 


60

















 


additional
Indebtedness (other than Permitted Indebtedness) pursuant to Section 4.09
hereof, (iii) except in the case of a merger of the Company with or into a
Wholly-Owned Restricted Subsidiary of the Company and except in the case of a
merger entered into solely for the purpose of reincorporating the Company in
another jurisdiction, immediately after giving effect to such transaction and
the assumption contemplated by clause (i)(b)(y) above (including, without
limitation, giving effect to any Indebtedness and Acquired Indebtedness
incurred and any Lien granted in connection with or in respect of the
transaction), no Default or Event of Default shall have occurred or be
continuing; and (iv) the Company or the Surviving Entity shall have delivered
to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating
that such consolidation, merger, sale, assignment, transfer, lease, conveyance
or other disposition and, if a supplemental indenture is required in connection
with such transaction, such supplemental indenture comply with the applicable
provisions of this Indenture and that all conditions precedent in this
Indenture relating to such transaction have been satisfied.


 


For
purposes of the foregoing, the transfer (by lease, assignment, sale or
otherwise, in a single transaction or series of transactions) of all or
substantially all of the properties or assets of one or more Subsidiaries of
the Company the Capital Stock of which constitutes all or substantially all of
the properties and assets of the Company, shall be deemed to be the transfer of
all or substantially all of the properties and assets of the Company. However,
transfer of assets (i) between or among the Company and its Restricted
Subsidiaries, (ii) between and among Foreign Subsidiaries that are Restricted
Subsidiaries or (iii) from Foreign Subsidiaries to the Company or a Guarantor
will not be subject to this Section 5.01.


 


Notwithstanding
anything in this Section 5.01 to the contrary, the merger of PP
Acquisition Corporation with and into Polypore, Inc. on the Issue Date shall be
permitted under this Indenture without complying with the requirements of this
Section 5.01.


 


                SECTION 5.02.  Successor Corporation Substituted.


 


Upon
any consolidation, combination or merger, or any transfer of all or
substantially all of the assets of the Company in accordance with Section 5.01
hereof, in which the Company is not the continuing corporation, the successor
Person formed by such consolidation or into which the Company is merged or to
which such conveyance, lease or transfer is made shall succeed to, and be
substituted for, and may exercise every right and power of the Company under
this Indenture and the Notes with the same effect as if such surviving entity
had been named as such and that, in the event of a conveyance or transfer (but
not a lease), the conveyor or transferor (but not a lessor) shall be released
from the provisions of this Indenture.


 


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ARTICLE 6




DEFAULTS
AND REMEDIES


 


                SECTION 6.01.  Events of Default.


 


“Event
of Defaults” are:


 


(a)                                  the failure to pay interest or any Additional
Interest (as required by the Registration Rights Agreement) on any Notes when
the same becomes due and payable if the default continues for a period of 30
days (whether or not such payment shall be prohibited by Article 10 or
Article 12 hereof);


 


(b)                                 the failure to pay the principal of or
premium, if any, on any Notes when such principal or premium, if any, becomes
due and payable, at maturity, upon redemption or otherwise (including the
failure to make a payment to purchase Notes tendered pursuant to a Change of
Control Offer or a Net Proceeds Offer on the date specified for such payment in
the applicable offer to purchase) (whether or not such payment shall be
prohibited by Article 10 or Article 12 hereof);


 


(c)                                  a default in the observance or performance of
any other covenant or agreement contained in this Indenture which default
continues for a period of 30 days after the Company receives written notice
specifying the default (and demanding that such default be remedied) from the Trustee
or the Holders of at least 25% of the outstanding principal amount of the Notes
(except in the case of a default with respect to Section 5.01 or
Section 11.06 hereof, which will constitute an Event of Default with such
notice requirement but without such passage of time requirement);


 


(d)                                 the failure to pay at final stated maturity
(giving effect to any applicable grace periods and any extensions thereof) the
principal amount of any Indebtedness of the Company or any Significant
Subsidiary of the Company (other than a Securitization Entity), or the
acceleration of the final stated maturity of any such Indebtedness, if the
aggregate principal amount of such Indebtedness, together with the principal
amount of any other such Indebtedness, whether such Indebtedness now exists, or
is created after the date of this Indenture, in default for failure to pay
principal at final maturity or which has been accelerated, aggregates $20.0
million or more at any time;


 


(e)                                  one or more judgments in an aggregate amount
in excess of $20.0 million (which are not covered by insurance or indemnity as
to which the insurer or a creditworthy indemnitor has not disclaimed coverage)
shall have been rendered against the Company or any of its Significant
Subsidiaries or group of Restricted Subsidiaries that, taken together (as of
the latest audited consolidated financial statements for the Company and its
Restricted Subsidiaries), would constitute a Significant Subsidiary and such
judgments remain undischarged, unpaid or unstayed for a period of 60 days after
such judgment or judgments become final and non-appealable;


 


(f)                                    the Company or any of its Significant
Subsidiaries or group of Restricted Subsidiaries that, taken together (as of
the latest audited consolidated financial statements for the Company and its
Restricted Subsidiaries), would constitute a Significant Subsidiary, pursuant
to or within the meaning of Bankruptcy Law:


 


(i)                                     commences a voluntary case;


 


(ii)                                  consents to the entry of an order for relief
against it in an involuntary case;


 


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(iii)                               consents to the appointment of a custodian of
it or for all or substantially all of its property; or


 


(iv)                              makes a general assignment for the benefit of
its creditors;


 


(g)                                 a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that:


 


(i)                                     is for relief against the Company or any of
its Significant Subsidiaries or group of Restricted Subsidiaries that, taken
together (as of the latest audited consolidated financial statements for the
Company and its Restricted Subsidiaries), would constitute a Significant
Subsidiary;


 


(ii)                                  appoints a custodian of the Company or any of
its Significant Subsidiaries or for all or substantially all of the property of
the Company or any of its Significant Subsidiaries or group of Restricted
Subsidiaries that, taken together (as of the latest audited consolidated
financial statements for the Company and its Restricted Subsidiaries), would
constitute a Significant Subsidiary; or


 


(iii)                               orders the liquidation of the Company or any
of its Significant Subsidiaries or group of Restricted Subsidiaries that, taken
together (as of the latest audited consolidated financial statements for the
Company and its Restricted Subsidiaries), would constitute a Significant
Subsidiary;


 


and
the order or decree remains unstayed and in effect for 60 consecutive days; or


 


(h)                                 any Guarantee of a Significant Subsidiary, or
group of Restricted Subsidiaries that, taken together (as of the latest audited
consolidated financial statements for the Company and its Restricted
Subsidiaries) would constitute a Significant Subsidiary, ceases to be in full
force and effect (except as contemplated by the terms of this Indenture) or is
declared null and void in a judicial proceeding or any Guarantor that is a
Significant Subsidiary or group of Guarantors that taken together (as of the
latest audited consolidated financial statements of the Company and its
Restricted Subsidiaries) would constitute a Significant Subsidiary denies or
disaffirms its obligations under this Indenture or its Guarantee.


 


                SECTION 6.02.  Acceleration.


 


If
any Event of Default (other than an Event of Default specified in clause (f) or
(g) of Section 6.01 hereof with respect to the Company) shall occur and be
continuing, the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Notes may declare the principal of and accrued interest on
all the Notes to be due and payable immediately by notice in writing to the
Company and the Trustee specifying the respective Event of Default and that it
is a “notice of acceleration” (the “Acceleration Notice”), and the same: (i)
shall become immediately due and payable or (ii) if there are any amounts
outstanding under the Credit Facility, shall become immediately due and payable
upon the first to occur of an acceleration under the Credit  Facility and five Business Days after
receipt by the Company and the Representative under the Credit Facility of such
Acceleration Notice but only if such Event of Default is then continuing. If an
Event of Default specified in clause (f) or (g) of Section 6.01 hereof
with respect to the 


 


63

















 


Company
occurs and is continuing, then all unpaid principal of, and premium, if any,
and accrued and unpaid interest on all the outstanding Notes shall ipso facto
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Holder.


 


At
any time after a declaration of acceleration with respect to the Notes as
described in the preceding paragraph, the Holders of a majority in principal
amount of the Notes may rescind and cancel such declaration and its
consequences: (i) if the rescission would not conflict with any judgment or
decree; (ii) if all existing Events of Default have been cured or waived except
nonpayment of principal of, premium, if any, and interest on the Notes that has
become due solely because of the acceleration; (iii) to the extent the payment
of such interest is lawful, interest on overdue installments of interest and
overdue principal, which has become due otherwise than by such declaration of
acceleration, has been paid; (iv) if the Company has paid the Trustee its
reasonable compensation and reimbursed the Trustee for its expenses,
disbursements and advances; and (v) in the event of the cure or waiver of an
Event of Default of the type described in clause (f) or (g) of
Section 6.01 hereof, the Trustee shall have received an Officers’
Certificate and an Opinion of Counsel that such Event of Default has been cured
or waived. 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, premium, if any, and
interest on the Notes or to enforce the performance of any provision of the
Notes or this Indenture.


 


The
Trustee may maintain a proceeding even if it does not possess any of the Notes
or does not produce any of them in the proceeding. A delay or omission by the
Trustee or any Holder of a Note in exercising any right or remedy accruing upon
an Event of Default shall not impair the right or remedy or constitute a waiver
of or acquiescence in the Event of Default. All remedies are cumulative to the
extent permitted by law.


 


                SECTION 6.04.  Waiver of Past Defaults.


 


Holders
of not less than a majority in aggregate principal amount of the then
outstanding Notes by notice to the Trustee may on behalf of the Holders of all
of the Notes waive an existing Default or Event of Default and its consequences
hereunder, except a continuing Default or Event of Default in the payment of
the principal of, premium and interest on the Notes (including in connection
with an offer to purchase). Upon any such waiver, such Default shall cease to
exist, and any Event of Default arising therefrom shall be deemed to have been
cured for every purpose of this Indenture; but no such waiver shall extend to
any subsequent or other Default or impair any right consequent thereon.


 


                SECTION 6.05.  Control by Majority.


 


Holders
of a majority in principal amount of the then outstanding Notes may direct the
time, method and place of conducting any proceeding for exercising any remedy
available to the


 


64

















 


Trustee
or exercising any trust or power conferred on it. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture, that
the Trustee determines may be unduly prejudicial to the rights of other Holders
of Notes or that may involve the Trustee in personal liability.


 


                SECTION 6.06.  Limitation on Suits.


 


Except
to enforce the right to receive payment of principal, premium, if any, or
interest when due, a Holder of a Note may pursue a remedy with respect to this
Indenture or the Notes only if:


 


(a)                                  the Holder of a Note gives to the Trustee
written notice stating that Event of Default is continuing;


 


(b)                                 the Holders of at least 25% in principal
amount of the then outstanding Notes make a written request to the Trustee to
pursue the remedy;


 


(c)                                  such Holder of a Note or Holders of Notes
offer and, if requested, provide to the Trustee indemnity satisfactory to the
Trustee against any loss, liability or expense;


 


(d)                                 the Trustee does not comply with the request
within 60 days after receipt of the request and the offer and, if requested,
the provision of indemnity; and


 


(e)                                  during such 60-day period the Holders of a
majority in principal amount of the then outstanding Notes do not give the
Trustee a direction inconsistent with the request.


 


A
Holder of a Note may not use this Indenture to prejudice the rights of another
Holder of a Note or to obtain a preference or priority over another Holder of a
Note.


 


                SECTION 6.07.  Rights of Holders of Notes to Receive
Payment.


 


Notwithstanding
any other provision of this Indenture, the right of any Holder of a Note to
receive payment of principal, premium and interest on the Note, on or after the
respective due dates expressed in the Note (including in connection with an
offer to purchase), 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 (a) or (b) hereof occurs and
is continuing, the Trustee is authorized to recover judgment in its own name
and as trustee of an express trust against the Company for the whole amount of
principal amount of, premium and interest remaining unpaid on the Notes and
interest on overdue principal and, to the extent lawful, interest and such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.


 


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                SECTION
6.09.  Trustee May File Proofs of
Claim.


 


The
Trustee is authorized to 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 (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the
Company (or any other obligor upon the Notes), its creditors or its property
and shall be entitled and empowered to collect, receive and distribute any
money or other property payable or deliverable on any such claims and any
custodian in any such judicial proceeding is hereby authorized by each Holder
to make such payments to the Trustee, and in the event that the Trustee shall
consent to the making of such payments directly to the Holders, to pay to the
Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 7.07 hereof. To the extent
that the payment of any such compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel, and any other amounts due the Trustee
under Section 7.07 hereof out of the estate in any such proceeding, shall
be denied for any reason, payment of the same shall be secured by a Lien on,
and shall be paid out of, any and all distributions, dividends, money,
securities and other properties that the Holders may be entitled to receive in
such proceeding whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on behalf of any
Holder any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.


 


                SECTION 6.10.  Priorities.


 


Any
money collected by the Trustee pursuant to this Article and any other money
or property distributable in respect of the Company’s obligations under this
Indenture after an Event of Default shall be applied in the following order:


 


FIRST:
to the Trustee (including a predecessor Trustee), its agents and attorneys for
amounts due under Section 7.07 hereof, including payment of all
compensation, expense and liabilities incurred, and all advances made, by the
Trustee (including a predecessor Trustee) and the costs and expenses of
collection;


 


SECOND:  to holders of Senior Debt of the Company to
the extent required by Article 10 hereof and to holders of Senior Debt of
the Guarantors to the extent required by Article 12 hereof;


 


THIRD:
to Holders of Notes for amounts due and unpaid on the Notes for principal
amount, premium, if any, and interest, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Notes for
principal amount, premium, if any, and interest, respectively; and


 


FOURTH:
to the Company or to such party as a court of competent jurisdiction shall
direct.


 


The
Trustee may fix a record date and payment date for any payment to Holders of
Notes pursuant to this Section 6.10.


 


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                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 a
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 of a
Note pursuant to Section 6.07 hereof, or a suit by Holders of more than
10% in principal amount of the then outstanding Notes.


 


ARTICLE 7




TRUSTEE


 


                SECTION 7.01.  Duties of Trustee.


 


(a)                                  If an Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and powers vested in
it by this Indenture, and use the same degree of care and skill in its
exercise, as a prudent person would exercise or use under the circumstances in
the conduct of his or her own affairs.


 


(b)                                 Except during the continuance of an Event of
Default:


 


(i)                                     the duties of the Trustee shall be determined
solely by the express provisions of this Indenture and the Trustee need perform
only those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and


 


(ii)                                  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 which are
specifically required to be delivered to the Trustee by any provision of this
Indenture to determine whether or not they conform to the requirements of this
Indenture.


 


(c)                                  The Trustee may not be relieved from
liabilities for its own negligent action, its own negligent failure to act, or
its own willful misconduct, except that:


 


(i)                                     this paragraph does not limit the effect of
paragraphs (b) or (e) of this Section;


 


(ii)                                  the Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer, unless it is proved
that the Trustee was negligent in ascertaining the pertinent facts; and


 


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(iii)                               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 hereof.


 


(d)                                 Whether or not therein expressly so provided,
every provision of this Indenture that in any way relates to the Trustee is
subject to paragraphs (a), (b), (c), (e) and (f) of this Section.


 


(e)                                  No provision of this Indenture shall require
the Trustee to expend or risk its own funds or incur any liability.  The Trustee shall be under no obligation to
exercise any of its rights and powers under this Indenture at the request of
any Holders, unless such Holder shall have offered to the Trustee security and
indemnify satisfactory to it against any loss, liability or expense.


 


(f)                                    The Trustee shall not be liable for interest
on any money received by it except as the Trustee may agree in writing with the
Company. Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by law.


 


                SECTION 7.02.  Rights of Trustee.


 


(a)                                  The Trustee may conclusively rely upon any
document believed by it to be genuine and to have been signed or presented by
the proper Person.  The Trustee need not
investigate any fact or matter stated in the document.


 


(b)                                 Before the Trustee acts or refrains from
acting, it may require an Officers’ Certificate or an Opinion of Counsel or
both. The Trustee shall not be liable for any action it takes or omits to take
in good faith in reliance on such Officers’ Certificate or Opinion of Counsel.
The Trustee may consult with counsel of its selection and the advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection from liability in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon.


 


(c)                                  The Trustee may act through its attorneys and
agents and shall not be responsible for the misconduct or negligence of any
agent appointed with due care.


 


(d)                                 The Trustee shall not be liable for any
action it takes or omits to take in good faith that it believes to be
authorized or within the rights or powers conferred upon it by this Indenture.


 


(e)                                  Unless otherwise specifically provided in
this Indenture, any demand, request, direction or notice from the Company shall
be sufficient if signed by an Officer of the Company.


 


(f)                                    The Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Indenture at the
request or direction of any of the Holders, unless such Holders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities that might be incurred by it in compliance with such
request or direction.


 


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(g)                                 Notwithstanding Section 6.05 hereof, the
Trustee shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other
evidence of Indebtedness or other paper or document, but the Trustee, in its
discretion, may make such further inquiry or investigation into such facts or
matters as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the books, records
and premises of the Company, personally or by agent or attorney at the sole
cost of the Company and shall incur no liability or additional liability of any
kind by reason of such inquiry or investigation.


 


(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 each agent, custodian and other Person
employed to act hereunder.


 


(i)                                     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.


 


                SECTION 7.03.  Individual Rights of Trustee.


 


The
Trustee in its individual or any other capacity may become the owner or pledgee
of Notes and may otherwise deal with the Company or any Affiliate of the
Company with the same rights it would have if it were not Trustee.  However, in the event that the Trustee acquires
any conflicting interest it must eliminate such conflict within 90 days, apply
to the SEC for permission to continue as trustee or resign.  The Registrar or any Paying Agent may do the
same with like rights and duties.  The
Trustee is also subject to Sections 7.10 and 7.11 hereof.


 


                SECTION 7.04.  Trustee’s Disclaimer.


 


The
Trustee shall not be responsible for and makes no representation as to the
validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Company’s use of the proceeds from the Notes or any money
paid to the Company or upon the Company’s direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee, and it shall not be
responsible for any statement or recital herein or any statement in the Notes
or any other document in connection with the sale of the Notes or pursuant to
this Indenture other than its certificate of authentication.


 


                SECTION 7.05.  Notice of Defaults.


 


(a)                                  The Trustee shall not be deemed to have
notice of any Default or Event of Default unless a Responsible Officer of the
Trustee has actual knowledge thereof or unless written notice of any event
which is in fact such a Default is received by the Trustee at the Corporate Trust
Office of the Trustee, and such notice references the Notes and this Indenture.


 


(b)                                 Within the earlier of 90 days after the
occurrence of a Default or an Event of Default or 30 days after it is actually
known to a Responsible Officer, the Trustee shall mail to Holders of Notes, as
their names and addresses appear in the security register for the Notes, a


 


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notice
of the Default or Event of Default known to the Trustee, unless such Default or
Event of Default shall have been cured or waived. Except in the case of a
Default or Event of Default in payment of principal of, premium, if any, or
interest on any Note, the Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of the Holders of the Notes.


 


                SECTION 7.06.  Reports by Trustee to Holders of the
Notes.


 


As
promptly as practical but within 60 days after each April 30 beginning
with April 30, 2005, and for so long as Notes remain outstanding, the
Trustee shall mail to the Holders of the Notes a brief report dated as of such
reporting date that complies with TIA § 313(a) (but if no event described
in TIA § 313(a) has occurred within the twelve months preceding the
reporting date, no report need be transmitted). The Trustee also shall comply
with TIA § 313(b)(2). The Trustee shall also transmit by mail all reports
as required by TIA § 313(c).


 


A
copy of each report at the time of its mailing to the Holders of Notes shall be
mailed to the Company and filed with the SEC and each stock exchange on which
the Notes are listed in accordance with TIA § 313(d). The Company shall
promptly notify the Trustee when the Notes are listed on any stock exchange and
any delisting thereof.


 


                SECTION 7.07.  Compensation and Indemnity.


 


The
Company shall pay to the Trustee from time to time such compensation for its
services as the parties shall agree from time to time.  The Trustee’s compensation shall not be
limited by any law on compensation of a trustee of an express trust.  The 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 out-of-pocket expenses of the Trustee’s agents
and counsel.  The Company and each
Guarantor, jointly and severally shall indemnify the Trustee against any and
all loss, liability, claim, damage or expense (including reasonable attorneys’
fees and expenses) incurred by or in connection with the acceptance or
administration of this trust and the performance of its duties hereunder,
including the costs and expenses of enforcing this Indenture or a Guarantee
against the Company or a Guarantor (including this Section 7.07) and
defending itself against or investigating any claim (whether asserted by the
Company, any Guarantor, any Holder or any other Person).  The Trustee shall notify the Company of any
claim for which it may seek indemnity promptly upon obtaining actual knowledge
thereof; provided, however,
that any failure so to notify the Company shall not relieve the Company or any
Guarantor of its indemnity obligations hereunder.  The Company shall defend the claim and the indemnified party
shall provide reasonable cooperation at the Company’s expense in the
defense.  Such indemnified parties may
have separate counsel and the Company and the Guarantors, as applicable shall
pay the fees and expenses of such counsel. 
The Company need not reimburse any expense or indemnify against any
loss, liability or expense incurred by an indemnified party through such
party’s own willful misconduct, negligence or bad faith.


 


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The
obligations of the Company and the Guarantors under this Section 7.07
shall survive the resignation or removal of the Trustee, the satisfaction and
discharge of this Indenture and the termination of this Indenture.


 


To
secure the Company’s and the Guarantors’ payment obligations in this Section,
the Trustee shall have a Lien prior to the Notes on all money or property held
or collected by the Trustee, other than money or property held in trust to pay
principal and interest on particular Notes. Such Lien shall survive the
resignation or removal of the Trustee, the satisfaction and discharge and the
termination of this Indenture.


 


In
addition, and without prejudice to the rights provided to the Trustee under any
of the provisions of this Indenture, when the Trustee incurs expenses or
renders services after an Event of Default specified in Section 6.01(f) or
(g) hereof occurs, the expenses and the compensation for the services
(including the fees and expenses of its agents and counsel) are intended to
constitute expenses of administration under any Bankruptcy Law.


 


“Trustee”
for purposes of this Section shall include any predecessor Trustee and the
Trustee in each of its capacities hereunder and each agent, custodian and other
person employed to act hereunder; provided,
however, that the negligence, wilful misconduct or bad faith of any
Trustee hereunder shall not affect the rights of any other Trustee hereunder.


 


The
Trustee shall comply with the provisions of TIA § 313(b)(2) to the extent
applicable.


 


                SECTION 7.08.  Replacement of Trustee.


 


A
resignation or removal of the Trustee and appointment of a successor Trustee
shall become effective only upon the successor Trustee’s acceptance of
appointment as provided in this Section.


 


The
Trustee may resign in writing at any time and be discharged from the trust
hereby created by so notifying the Company. The Holders of Notes of a majority
in principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Company in writing and may appoint a successor
trustee. The Company may remove the Trustee if:


 


(a)                                  the Trustee fails to comply with
Section 7.10 hereof,


 


(b)                                 the Trustee is adjudged a bankrupt or an
insolvent or an order for relief is entered with respect to the Trustee under
any Bankruptcy Law;


 


(c)                                  a custodian or public officer takes charge of
the Trustee or its property; or


 


(d)                                 the Trustee becomes incapable of acting.


 


If
the Trustee resigns or is removed or if a vacancy exists in the office of
Trustee for any reason, the Company shall promptly appoint a successor Trustee.
Within one year after the successor Trustee takes office, the Holders of a
majority in principal amount of the then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company.


 


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If
a successor Trustee does not take office within 60 days after the retiring
Trustee resigns or is removed, the retiring Trustee, the Company, or the
Holders of Notes of at least 10% in principal amount of the then outstanding
Notes may petition any court of competent jurisdiction for the appointment of a
successor Trustee.


 


If
the Trustee, after written request by any Holder of a Note who has been a bona
fide holder of a Note for at least six months, fails to comply with
Section 7.10, such Holder of a Note may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of 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 Holders of the
Notes. The retiring Trustee shall promptly transfer all property held by it as
Trustee to the successor Trustee, provided all sums owing to the Trustee hereunder
have been paid and subject to the Lien provided for in Section 7.07
hereof. Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, the Company’s obligations under Section 7.07 hereof
shall continue for the benefit of the retiring Trustee.


 


                SECTION 7.09.  Successor Trustee by Merger, etc.


 


If
the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business or assets to, another Person,
the resulting, surviving, transferee or successor Person without any further
act shall be the successor Trustee.


 


                SECTION 7.10.  Eligibility; Disqualification.


 


There
shall at all times be a Trustee hereunder that is a corporation organized and
doing business under the laws of the United States of America or of any State
thereof, that is authorized under such laws to exercise corporate trustee
power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100.0
million as set forth in its most recent published annual report of condition.


 


This
Indenture shall always have a Trustee who satisfies the requirements of TIA
§ 310(a). The Trustee is subject to TIA § 310(b).


 


                SECTION 7.11.  Preferential Collection of Claims Against
Company.


 


The
Trustee is subject to 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 therein.


 


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ARTICLE 8



LEGAL DEFEASANCE AND COVENANT DEFEASANCE SECTION


 


                SECTION 8.01.  Option to Effect Legal Defeasance or
Covenant Defeasance.


 


The
Company may, at the option of its Board of Directors evidenced by a resolution
set forth in an Officers’ Certificate, at any time, elect to have either
Section 8.02 or 8.03 hereof applied to all outstanding Dollar Notes and/or
Euro Notes upon compliance with the conditions set forth below in this
Article 8.


 


                SECTION 8.02.  Legal Defeasance and Discharge.


 


Upon
the Company’s exercise under Section 8.01 hereof of the option applicable
to this Section 8.02, the Company shall, subject to the satisfaction of
the conditions set forth in Section 8.04 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Dollar Notes
and/or Euro Notes on the date the conditions set forth below are satisfied
(hereinafter, “Legal Defeasance”). For this purpose, Legal Defeasance means
that the Company shall be deemed to have paid and discharged the entire
Indebtedness represented by the outstanding Dollar Notes and/or Euro Notes,
which shall thereafter be deemed to be “outstanding” only for the purposes of
Section 8.05 hereof and the other Sections of this Indenture referred to
in (a) and (b) below, and to have satisfied all its other obligations under
such Notes and this Indenture (and the Trustee, on demand of and at the expense
of the Company, shall execute proper instruments acknowledging the same),
except for the following provisions which shall survive until otherwise
terminated or discharged hereunder: (a) the rights of Holders of outstanding
Notes to receive solely from the trust fund described in Section 8.04
hereof, and as more fully set forth in such Section, payments in respect of the
principal amount of, premium, if any, and interest on such Notes when such
payments are due, (b) the Company’s obligations with respect to such Notes
under Article 2 and Section 4.02 hereof, (c) the rights, powers,
trusts, duties and immunities of the Trustee hereunder and the Company’s
obligations in connection therewith and (d) the provisions of this
Article 8 with respect to Legal Defeasance. Subject to compliance with
this Article 8, the Company may exercise its option under this Section 8.02
notwithstanding the prior exercise of its option under Section 8.03
hereof.


 


                SECTION 8.03.  Covenant Defeasance.


 


Upon
the Company’s exercise under Section 8.01 hereof of the option applicable
to this Section 8.03, the Company shall, subject to the satisfaction of
the conditions set forth in Section 8.04 hereof, be released from its
obligations under the covenants contained in Sections 4.07, 4.08, 4.09, 4.10,
4.11, 4.12, 4.13, 4.15, 4.16, 4.17 and 4.18 hereof with respect to the
outstanding Dollar Notes and/or Euro Notes on and after the date the conditions
set forth in Section 8.04 hereof are satisfied (hereinafter, “Covenant
Defeasance”), and the Dollar Notes and/or Euro Notes shall thereafter be deemed
not “outstanding” for the purposes of any direction, waiver, consent or
declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed “outstanding”
for all other purposes hereunder (it being understood that such Notes shall not
be deemed outstanding for accounting purposes). For this purpose, Covenant
Defeasance means that, with respect to the outstanding Dollar Notes and/or Euro
Notes, the Company may omit to comply with and shall have no liability in
respect of any term, condition or limitation set forth in any such covenant,
whether directly or indirectly, by reason of any reference elsewhere herein to
any such covenant or by reason of any reference in any such covenant to any
other provision herein or in any other document and such omission to comply
shall not constitute a Default or an Event of Default under Section 6.01
hereof, but, except as specified above, the remainder of this Indenture and
such Notes shall be unaffected


 


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thereby.
In addition, upon the Company’s exercise under Section 8.01 hereof of the
option applicable to this Section 8.03 hereof, subject to the satisfaction
of the conditions set forth in Section 8.04 hereof, Sections 6.01(d) and
6.01(e) hereof shall not constitute Events of Default.


 


                SECTION 8.04.  Conditions to Legal or Covenant
Defeasance.


 


The
following shall be the conditions to the application of either
Section 8.02 or 8.03 hereof to the outstanding Notes:


 


In
order to exercise either Legal Defeasance or Covenant Defeasance:


 


(a)                                  the Company must irrevocably deposit with the
Trustee, in trust, for the benefit of the Holders, cash in United States
dollars or euros, as applicable, non-callable Government Obligations, or a
combination of United States dollars or euros, as applicable, and Government
Obligations, in such amounts as will be sufficient, in the opinion of a
nationally recognized firm of independent public accountants, to pay the
principal amount at maturity of, premium, if any, and interest on the outstanding
Notes on the stated date for payment thereof or on the applicable redemption
date, as the case may be;


 


(b)                                 in the case of an election under
Section 8.02 hereof, the Company shall have delivered to the Trustee an
Opinion of Counsel in the United States of America reasonably acceptable to the
Trustee confirming 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 Holders of the outstanding Notes will not
recognize income, gain or loss for Federal income tax purposes as a result of
such Legal 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 Legal Defeasance had not occurred;


 


(c)                                  in the case of an election under
Section 8.03 hereof, the Company shall have delivered to the Trustee an
Opinion of Counsel in the United States of America reasonably acceptable to the
Trustee confirming that the Holders of the outstanding Notes 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;


 


(d)                                 no Default or Event of Default shall have
occurred and be continuing on the date of such deposit (other than a Default or
Event of Default resulting from the borrowing of funds to be applied to such
deposit and the grant of any Lien to securing such borrowing) or insofar as
Section 6.01 (f) or 6.01(g) hereof is concerned, at any time in the period
ending on the 91st day after the date of deposit;


 


(e)                                  such Legal Defeasance or Covenant Defeasance
shall not result in a breach or violation of, or constitute a default under
this Indenture (other than a Default or an Event of Default resulting from the
borrowing of funds to be applied to such deposit and the grant of any Lien
securing such borrowing) or any other material agreement or instrument to which
the


 


74

















 


Company
or any of its Subsidiaries is a party or by which the Company or any of its
Subsidiaries is bound;


 


(f)                                    the Company shall have delivered to the
Trustee an Opinion of Counsel to the effect that (A) the trust funds will not
be subject to any rights of holders of Senior Debt including, without
limitation, those arising under this Indenture, and (B) after the 91st day
following the deposit, the trust funds will not be subject to the effect of the
preference provisions of Section 547 of the United States Federal
Bankruptcy Code;


 


(g)                                 the Company shall have delivered to the
Trustee an Officers’ Certificate stating that the deposit was not made by the
Company with the intent of preferring the Holders over any other creditors of
the Company or with the intent of defeating, hindering, delaying or defrauding
any other creditors of the Company or others;


 


(h)                                 the Company shall have delivered to the
Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that
all conditions precedent provided for or relating to the Legal Defeasance or
the Covenant Defeasance have been complied with; and


 


(i)                                     the Company shall have paid or duly provided
for payment of all amounts then due to the Trustee pursuant to
Section 7.07 hereof.


 


Notwithstanding
the foregoing, the Opinion of Counsel required by clause (b) above with respect
to a Legal Defeasance need not be delivered if all Notes not therefor delivered
to the Trustee for cancellation (A) have become due and payable, or (B) will
become due and payable on the maturity date within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the Company.


 


                SECTION 8.05.  Deposited Money and Government
Obligations to Be Held in Trust; Other Miscellaneous Provisions.


 


Subject
to Section 8.06 hereof, all money and non-callable Government Obligations
(including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.05, the
“Trustee”) pursuant to Section 8.04 hereof in respect of the outstanding
Notes shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Company acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal amount, premium, if any, and
interest, but such money need not be segregated from other funds except to the
extent required by law.


 


The
Company shall pay and indemnify the Trustee against any tax, fee or other
charge imposed on or assessed against the cash or non-callable Government
Obligations deposited pursuant to Section 8.04 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding Notes.


 


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Anything
in this Article 8 to the contrary notwithstanding, the Trustee shall
deliver or pay to the Company from time to time upon the request of the Company
any money or non-callable Government Obligations held by it as provided in
Section 8.04 hereof which, in the opinion of a nationally recognized firm
of independent public accountants expressed in a written certification thereof
delivered to the Trustee (which may be the opinion delivered under
Section 8.04(a) hereof), are in excess of the amount thereof that would
then be required to be deposited to effect an equivalent Legal Defeasance or
Covenant Defeasance.


 


                SECTION 8.06.  Satisfaction and Discharge.


 


This
Indenture shall be discharged and shall cease to be of further effect (except
as to surviving rights or registration of transfer or exchange of the Dollar
Notes and/or Euro Notes, as expressly provided for in this Indenture) as to all
outstanding Dollar Notes and/or Euro Notes when (i) either (a) all the Notes
theretofore authenticated and delivered (except lost, stolen or destroyed Notes
which have been replaced or paid and Notes for whose payment money has
theretofore been deposited in trust or segregated and held in trust by the
Company and thereafter repaid to the Company or discharged from such trust)
have been delivered to the Trustee for cancellation or; (b) all Notes not
theretofore delivered to the Trustee for cancellation have become due and
payable, pursuant to an optional redemption notice or otherwise, and the
Company has irrevocably deposited or caused to be deposited with the Trustee
funds in an amount sufficient to pay and discharge the entire Indebtedness on
the Notes not theretofore delivered to the Trustee for cancellation, for
principal of, premium, if any, and interest on the Notes to the date of deposit
together with irrevocable instructions from the Company directing the Trustee
to apply such funds to the payment thereof at maturity or redemption, as the
case may be; (ii) the Company has paid all other sums payable under this Indenture
by the Company; and (iii) the Company has delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel stating that all conditions precedent
under this Indenture relating to the satisfaction and discharge of this
Indenture have been complied with.


 


                SECTION 8.07.  Repayment to Company.


 


Each
of the Trustee and each Paying Agent shall promptly turn over to the Company
upon request any money or Government Obligations held by it as provided in this
Article which, in the written opinion of nationally recognized firm of
independent public accountants delivered to the Trustee (which delivery shall
only be required if Government Obligations have been so deposited), are in
excess of the amount thereof which would then be required to be deposited to
effect an equivalent discharge or defeasance in accordance with this Article.


 


Subject
to any applicable abandoned property law, the Trustee and each Paying Agent
shall pay to the Company upon written request any money held by them for the
payment of principal or interest that remains unclaimed for two years, and,
thereafter, Holders entitled to the money must look to the Company for payment
as general creditors, and the Trustee and each Paying Agent shall have no
further liability with respect to such monies.


 


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                SECTION 8.08.  Reinstatement.


 


If
the Trustee or Paying Agent is unable to apply any United States dollars, euros
or noncallable Government Obligations in accordance with Section 8.02 or
8.03 hereof, as the case may be, by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Company’s obligations under this Indenture and the
Notes shall be revived and reinstated as though no deposit had occurred
pursuant to Section 8.02 or 8.03 hereof until such time as the Trustee or
Paying Agent is permitted to apply all such money in accordance with
Section 8.02 or 8.03 hereof, as the case may be; provided  however, that, if the Company makes any payment of
principal of, premium, if any, or interest on any Note following the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Notes to receive such payment from the money held by the
Trustee or Paying Agent.


 


                SECTION 8.09.  Survival.


 


The
Trustee’s rights under this Article 8 shall survive termination of this
Indenture.


 


ARTICLE 9



AMENDMENT, SUPPLEMENT AND WAIVER


 


                SECTION 9.01.  Without Consent of Holders of Notes.


 


Notwithstanding
Section 9.02 of this Indenture, the Company, the Guarantors and the
Trustee may amend or supplement this Indenture, the Guarantees or the Notes
without the consent of any Holder of a Note:


 


(a)                                  to cure any ambiguity, defect or
inconsistency;


 


(b)                                 to provide for uncertificated Notes in
addition to or in place of certificated Notes (provided that the uncertificated Notes are issued in
registered form for purposes of Section 163(f) of the Code, or in a manner
such that the uncertificated Notes are described in Section 163(f)(2)(B)
of the Code) or to alter the provisions of Article 2 or the Appendix
hereof relating to the form of the Notes (including the related definitions) in
a manner that does not adversely affect any Holder;


 


(c)                                  to provide for the assumption of the
Company’s or a Guarantor’s obligations to the Holders of the Notes by a
successor to the Company or a Guarantor pursuant to Article 5 or
Section 11.06 hereof,


 


(d)                                 to make any change that would provide any
additional rights or benefits to the Holders of the Notes or that does not
adversely affect the legal rights hereunder of any Holder of the Notes;


 


(e)                                  to comply with requirements of the SEC in
order to effect or maintain the qualification of this Indenture under the TIA;


 


(f)                                    to provide for the issuance of Notes issued
after the Issue Date in accordance with the limitations set forth in this
Indenture;


 


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(g)                                 to release any Guarantor from its Guarantee
in accordance with this Indenture;


 


(h)                                 to allow any Guarantor to execute a
supplemental indenture and/or a Guarantee with respect to the Notes; or


 


(i)                                     make any change in Article 10 and
Article 12 of this Indenture that would limit or terminate the benefits
available to any holder of Senior Debt of the Company or a holder of Guarantor
Senior Debt (or any Representative thereof) under such Article 10 and
Article 12.


 


Upon
the request of the Company accompanied by a resolution of its Board of
Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in
Section 7.02 hereof, the Trustee shall join with the Company and the
Guarantors in the execution of any amended or supplemental Indenture authorized
or permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations that may be therein contained, but the Trustee
shall not be obligated to enter into such amended or supplemental Indenture
that affects its own rights, duties or immunities under this Indenture or
otherwise.


 


                SECTION 9.02.  With Consent of Holders of Notes.


 


(a)                                  Except as provided below in this
Section 9.02, this Indenture (including Sections 3.09, 4.10 and 4.15
hereof), the Guarantees and the Notes may be amended or supplemented with the
consent of the Holders of at least a majority in principal amount of the Notes
then outstanding voting as a single class (including consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the Notes),
and, subject to Sections 6.04 and 6.07 hereof, any existing Default or Event of
Default (other than a Default or Event of Default in the payment of the
principal of, premium, if any, or interest on the Notes, except a payment
default resulting from an acceleration that has been rescinded) or compliance
with any provision of this Indenture, the Guarantees or the Notes may be waived
with the consent of the Holders of a majority in principal amount of the then
outstanding Notes voting as a single class (including consents obtained in
connection with a tender offer or exchange offer for, or purchase of, the
Notes).  Section 2.08 hereof shall
determine which Notes are considered to be “outstanding” for purposes of this
Section 9.02.


 


(b)                                 Upon the request of the Company accompanied
by a resolution of its Board of Directors authorizing the execution of any such
amended or supplemental Indenture, and upon the filing with the Trustee of
evidence satisfactory to the Trustee of the consent of the Holders of Notes as
aforesaid, and upon receipt by the Trustee of the documents described in
Section 7.02 hereof, the Trustee shall join with the Company in the
execution of such amended or supplemental Indenture unless such amended or
supplemental Indenture directly affects the Trustee’s own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion, but shall not be obligated to, enter into such amended or
supplemental Indenture.


 


(c)                                  It shall not be necessary for the consent of
the Holders of Notes under this Section 9.02 to approve the particular
form of any proposed amendment or waiver, but it shall be sufficient if such
consent approves the substance thereof.


 


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(d)                                 After an amendment, supplement or waiver
under this Section becomes effective, the Company shall mail to the
Holders of Notes affected thereby a notice briefly describing the amendment,
supplement or waiver. Any failure of the Company to mail such notice, or any
defect therein, shall not, however, in any way impair or affect the validity of
any such amended or supplemental Indenture or waiver. Subject to Sections 6.04
and 6.07 hereof, the Holders of a majority in aggregate principal amount of the
Notes then outstanding voting as a single class may waive compliance in a
particular instance by the Company with any provision of this Indenture or the
Notes provided, however,
that if any amendment, waiver or other modification will only affect the Dollar
Notes or the Euro Notes, only the consent of the Holders of a majority in
principal amount of the then outstanding Dollar Notes or Euro Notes, as the
case may be (and not the consent of a majority of all Notes) shall be required.
However, without the consent of each Holder affected, an amendment or waiver
under this Section 9.02 may not (with respect to any Notes held by a
non-consenting Holder):


 


(1)                                  reduce the principal amount of Notes whose
Holders must consent to an amendment, supplement or waiver;


 


(2)                                  reduce the principal of or change or have the
effect of changing the fixed maturity of any Note, or change the date on which
any Notes may be subject to redemption or reduce the redemption price therefor;


 


(3)                                  reduce the rate of or change or have the
effect of changing the time for payment of interest, including defaulted
interest, on any Note;


 


(4)                                  make any Note payable in money other than
that stated in the Notes;


 


(5)                                  make any change in the provisions of this
Indenture protecting the right of each Holder to receive payment of principal
of or interest on any Note on or after the due date thereof or to bring suit to
enforce such payment, or permitting Holders of a majority in principal amount
of Notes to waive Defaults or Events of Default;


 


(6)                                  after the Company’s obligation to purchase
Notes arises thereunder, amend, change or modify in any material respect the
obligation of the Company to make and consummate a Change of Control Offer in
the event of a Change of Control or modify any of the provisions or definitions
with respect thereto after a Change of Control has occurred;


 


(7)                                  modify or change any provision of this
Indenture, including the Guarantees or the related definitions, affecting the
subordination or ranking of the Notes or the Guarantees in a manner which
adversely affects the Holders; or


 


(8)                                  make any change in the foregoing amendment
and waiver provisions.


 


An
amendment under this Section may not make any change that adversely
affects the rights under Article 10 or 12 hereof or any supplemental indenture
to this Indenture providing for a Guarantee of the Notes by a Restricted
Subsidiary of the Company of any holder of Senior Debt of the Company or of a
Guarantor then outstanding (including any such change of this paragraph of this
Section 9.02) unless the holders of such Senior Debt (or their
Representative) consent to such change.


 


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                SECTION 9.03.  Compliance with Trust Indenture Act.


 


From
the date on which this Indenture is qualified under the TIA, every amendment or
supplement to this Indenture or the Notes shall be set forth in a amended or
supplemental Indenture that complies with the TIA as then in effect.


 


                SECTION 9.04.  Revocation and Effect of Consents.


 


Until
an amendment, supplement or waiver becomes effective, a consent to it by a
Holder of a Note is a continuing consent by the Holder of a Note and every
subsequent Holder of a Note or portion of a Note that evidences the same debt
as the consenting Holder’s Note, even if notation of the consent is not made on
any Note. However, any such Holder of a Note or subsequent Holder of a Note may
revoke the consent as to its Note if the Trustee receives written notice of
revocation before the date the waiver, supplement or amendment becomes effective.
An amendment, supplement or waiver becomes effective in accordance with its
terms and thereafter binds every Holder.


 


                SECTION 9.05.  Notation on or Exchange of Notes.


 


The
Trustee may place an appropriate notation about an amendment, supplement or waiver
on any Note thereafter authenticated. The Company in exchange for all Notes may
issue and the Trustee shall, upon receipt of an Authentication Order,
authenticate new Notes that reflect the amendment, supplement or waiver.


 


Failure
to make the appropriate notation or issue a new Note shall not affect the
validity and effect of such amendment, supplement or waiver.


 


                SECTION 9.06.  Trustee to Sign Amendments, etc.


 


The
Trustee shall sign any amendment, supplement or waiver authorized pursuant to
this Article 9 if the amendment, supplement or waiver does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The
Company may not sign an amendment or supplemental Indenture until the Board of
Directors approves it. In executing any amended or supplemental indenture, the
Trustee shall be entitled to receive and (subject to Section 7.01 hereof)
shall be fully protected in relying upon, in addition to the documents required
by Section 13.04 hereof, an Officer’s Certificate and an Opinion of
Counsel stating that the execution of such amendment, supplement or waiver is
authorized or permitted by this Indenture and that such amendment, supplement
or waiver is the legal, valid and binding obligation of the Company and the
Guarantors, enforceable against them in accordance with its terms, subject to
customary exceptions, and complies with the provisions hereof (including
Section 9.03 hereof).


 


                SECTION 9.07.  Additional Voting Terms; Calculation of
Principal Amount.


 


Except
as provided in the proviso to the third sentence of Section 9.02(d), all
Notes issued under this Indenture shall vote and consent together on all
matters (as to which any of such Notes may vote) as one class and no series of
Notes will have the right to vote or consent as a separate class on any
matter.  Determinations as to whether
Holders of the requisite aggregate


 


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principal
amount of Notes have concurred in any direction, waiver or consent shall be
made in accordance with this Article 9 and Section 2.15.


 


ARTICLE 10



SUBORDINATION


 


                SECTION 10.01.  Agreement to Subordinate.


 


The
Company agrees, and each Holder by accepting a Note agrees, that the
Indebtedness evidenced by the Notes is subordinated in right of payment, to the
extent and in the manner provided in this Article 10, to the prior payment
of all existing and future Senior Debt of the Company and that the
subordination is for the benefit of and enforceable by the holders of such
Senior Debt.  The Notes shall in all
respects rank pari passu with all other Senior Subordinated Debt of the Company
and only Indebtedness of the Company which is Senior Debt of the Company shall
rank senior to the Notes in accordance with the provisions set forth herein.  All provisions of this Article 10 shall
be subject to Section 10.12.


 


                SECTION 10.02.  Liquidation, Dissolution, Bankruptcy.


 


Upon
any payment or distribution of the assets of the Company to creditors upon (i)
a total or partial liquidation or a total or partial dissolution of the
Company; (ii) in a bankruptcy, reorganization, insolvency, receivership or
similar proceeding relating to the Company or its property or (iii) an
assignment for the benefit of creditors or marshaling of the Company’s assets
and liabilities:


 


(1)                                  holders of Senior Debt of the Company shall
be entitled to receive payment in full in cash of such Senior Debt (including
interest accruing after, or which would accrue but for, the commencement of any
proceeding at the rate specified in the applicable Senior Debt, whether or not
a claim for such interest would be allowed) before Holders shall be entitled to
receive any payment;


 


(2)                                  until the Senior Debt of the Company is paid
in full in cash, any payment or distribution to which Holders would be entitled
but for this Article 10 shall be made to holders of such Senior Debt as
their interests may appear, except that Holders of the Notes may receive and
retain Permitted Junior Securities; and


 


(3)                                  if a distribution is made to Holders of the
Note that, due to the subordination provisions, should not have been made to
them, such Holders of the Notes are required to hold it in trust for the
holders of Senior Debt of the Company and pay it over to them as their interest
may appear.


 


                SECTION 10.03.  Default on Senior Debt of the Company.


 


The
Company shall not pay the principal of, premium, if any, or interest on the
Notes or make any deposit pursuant to Section 8.04 and may not purchase,
redeem or otherwise retire any Notes (collectively, “pay the Notes”) if either
of the following (a “Payment Default”) occurs (1)


 


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any
Designated Senior Debt of the Company is not paid in full in cash when due; or
(2) any other default on Designated Senior Debt of the Company occurs and the
maturity of such Designated Senior Debt is accelerated in accordance with its
terms unless, in either case, the Payment Default has been cured or waived and
any such acceleration has been rescinded or such Designated Senior Debt has
been paid in full in cash; provided,
however, that the Company shall be entitled to pay the Notes without
regard to the foregoing if the Company and the Trustee receive written notice
approving such payment from the Representative of all Designated Senior Debt
with respect to which the Payment Default has occurred and is continuing.
During the continuance of any default (other than a Payment Default) with
respect to any Designated Senior Debt of the Company pursuant to which the
maturity thereof may be accelerated immediately without further notice (except
such notice as may be necessary to effect such acceleration) or the expiration
of any applicable grace periods, the Company shall not pay the Notes for a
period (a “Payment Blockage Period”) commencing upon the receipt by the Trustee
of (with a copy to the Company) written notice (a “Blockage Notice”) of such
default from the Representative of such Designated Senior Debt specifying an
election to effect a Payment Blockage Period and ending 179 days thereafter.
The Payment Blockage Period shall end earlier if such Payment Blockage Period
is terminated (1) by written notice to the Trustee and the Company from the
Person or Persons who gave such Blockage Notice; (2) because the default giving
rise to such Blockage Notice is cured, waived or otherwise no longer
continuing; or (3) because such Designated Senior Debt has been discharged or
repaid in full in cash.  Notwithstanding
the provisions described in the immediately preceding two sentences (but
subject to the provisions contained in the first sentence of this Section),
unless the holders of such Designated Senior Debt or the Representative of such
Designated Senior Debt shall have accelerated the maturity of such Designated
Senior Debt, the Company shall be entitled to resume payments on the Notes
after termination of such Payment Blockage Period.  The Notes shall not be subject to more than one Payment Blockage
Period in any consecutive 360-day period, irrespective of the number of
defaults with respect to Designated Senior Debt of the Company during such
period; provided, however,
that if any Blockage Notice within such 360-day period is given to the Trustee
by or on behalf of any holders of Designated Senior Debt of the Company (other
than the Bank Indebtedness), the Representative of the Bank Indebtedness shall
be entitled to give another Blockage Notice within such period; provided  further, however, that in no event shall the total number of
days during which any Payment Blockage Period or Periods is in effect exceed
179 days in the aggregate during any 360-day consecutive period, and there must
be 181 days during any 360-day consecutive period during which no Payment
Blockage Period is in effect.  For
purposes of this Section, no default or event of default which existed or was
continuing on the date of the commencement of any Payment Blockage Period with
respect to the Designated Senior Debt of the Company initiating such Payment
Blockage Period shall be, or be made, the basis of the commencement of a
subsequent Payment Blockage Period by the Representative of such Designated
Senior Debt, whether or not within a period of 360 consecutive days, unless
such default or event of default shall have been cured or waived for a period
of not less than 90 consecutive days.


 


                SECTION 10.04.  Acceleration of Payment of Notes.


 


If
payment of the Notes is accelerated because of an Event of Default, the Company
or the Trustee shall promptly notify the holders of the Designated Senior Debt
of the Company (or their Representatives) of the acceleration.


 


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                SECTION 10.05.  When Distribution Must Be Paid Over.


 


If
a distribution is made to Holders that because of this Article 10 should
not have been made to them, the Holders who receive the distribution shall hold
it in trust for holders of Senior Debt of the Company and pay it over to them
as their interests may appear.  If any
Designated Senior Debt of the Company is outstanding, the Company shall not pay
the Notes until five Business Days after the Representatives of all the issues
of Designated Senior Debt of the Company receive notice of such acceleration
and, thereafter, shall be entitled to pay the Notes only if this
Article 10 otherwise permits payment at that time.


 


                SECTION 10.06.  Subrogation.


 


After
all Senior Debt of the Company is paid in full and until the Notes are paid in
full, Holders shall be subrogated to the rights of holders of such Senior Debt
to receive distributions applicable to such Senior Debt.  A distribution made under this
Article 10 to holders of such Senior Debt which otherwise would have been
made to Holders is not, as between the Company and Holders, a payment by the
Company on such Senior Debt.


 


                SECTION 10.07.  Relative Rights.


 


This
Article 10 defines the relative rights of Holders and holders of Senior
Debt of the Company.  Nothing in this
Indenture shall:


 


(1)                                  impair, as between the Company and Holders,
the obligation of the Company, which is absolute and unconditional, to pay
principal of and interest on the Notes in accordance with their terms; or


 


(2)                                  prevent the Trustee or any Holder from
exercising its available remedies upon a Default, subject to the rights of
holders of Senior Debt of the Company to receive distributions otherwise
payable to Holders.


 


                SECTION 10.08.  Subordination May Not Be Impaired by
Company.


 


No
right of any holder of Senior Debt of the Company to enforce the subordination
of the Indebtedness evidenced by the Notes shall be impaired by any act or
failure to act by the Company or by its failure to comply with this Indenture.


 


                SECTION 10.09.  Rights of Trustee and Paying Agent.


 


Notwithstanding
Section 10.03 or any other provision of this Indenture or the Notes, the
Trustee or Paying Agent shall continue to make payments on the Notes and shall
not be charged with knowledge of the existence of facts that under this
Article 10 would prohibit the making of any such payments unless, not less
than two Business Days prior to the date of such payment, a Responsible Officer
of the Trustee receives written notice satisfactory to it that such payments
may not be made under this Article 10 and, prior to the receipt of any
such written notice, the Trustee, shall be entitled in all respects
conclusively to presume that no such fact exists.  Unless the Trustee shall have received the notice provided for in
the preceding sentence, the Trustee


 


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shall
have full power and authority to receive such payment and to apply the same to
the purpose for which it was received, and shall not be affected by any notice
to the contrary which may be received by it on or after such date.  The foregoing shall not apply to any
Affiliate of the Company acting as Paying Agent.  The Company, a Representative or a holder of Senior Debt of the
Company shall be entitled to give such notice; provided, however, that, if an issue of Senior
Debt of the Company has a Representative, only the Representative shall be
entitled to give the notice.


 


The
Trustee in its individual or any other capacity shall be entitled to hold
Senior Debt of the Company with the same rights it would have if it were not
Trustee.  The Registrar and the Paying
Agent shall be entitled to do the same with like rights.  The Trustee shall be entitled to all the
rights set forth in this Article 10 with respect to any Senior Debt of the
Company which may at any time be held by it, to the same extent as any other
holder of such Senior Debt; and nothing in Article 7 shall deprive the
Trustee of any of its rights as such holder. 
Notwithstanding anything in this Article 10 to the contrary, all
amounts owed to the Trustee (including amounts owed pursuant to Sections 6.10
and 7.07 hereof) in each of its capacities hereunder shall not be subordinated
to any Senior Debt of the Company or otherwise.


 


                SECTION 10.10.  Distribution or Notice to Representative.


 


Whenever
any Person is to make a distribution or give a notice to holders of Senior Debt
of the Company, such Person shall be entitled to make such distribution or give
such notice to their Representative (if any).


 


                SECTION 10.11.  Not To Prevent Events of Default or Limit
Right To Accelerate.


 


The
failure to make a payment pursuant to the Notes by reason of any provision in
this Article 10 shall not be construed as preventing the occurrence of a
Default.  Nothing in this
Article 10 shall have any effect on the right of the Holders or the
Trustee to accelerate the maturity of the Notes.


 


                SECTION 10.12.  Trust Moneys Not Subordinated.


 


Notwithstanding
anything contained herein to the contrary, payments from money or the proceeds
of Government Obligations held in trust under Article 8 hereof by the
Trustee for the payment of principal of and interest on the Notes shall not be
subordinated to the prior payment of any Senior Debt of the Company or subject
to the restrictions set forth in this Article 10 if the provisions of this
Article 10 were not violated at the time funds were deposited in trust
with the Trustee pursuant to Article 8 hereof, and none of the Holders shall
be obligated to pay over any such amount to the Company or any holder of Senior
Debt of the Company or any other creditor of the Company.


 


                SECTION 10.13.  Trustee Entitled To Rely.


 


Upon
any payment or distribution pursuant to this Article 10, the Trustee and
the Holders shall be entitled to rely (1) upon any order or decree of a court
of competent jurisdiction in which any proceedings of the nature referred to in
Section 10.02 hereof are pending, (2) upon a


 


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certificate
of the liquidating trustee or agent or other Person making such payment or
distribution to the Trustee or to the Holders or (3) upon the Representatives
of Senior Debt of the Company for the purpose of ascertaining the Persons
entitled to participate in such payment or distribution, the holders of such
Senior Debt and other Indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article 10.  In the event that the Trustee determines, in
good faith, that evidence is required with respect to the right of any Person
as a holder of Senior Debt of the Company to participate in any payment or
distribution pursuant to this Article 10, the Trustee shall be entitled to
request such Person to furnish evidence to the reasonable satisfaction of the
Trustee as to the amount of such Senior Debt held by such Person, the extent to
which such Person is entitled to participate in such payment or distribution
and other facts pertinent to the rights of such Person under this
Article 10, and, if such evidence is not furnished, the Trustee shall be
entitled to defer any payment to such Person pending judicial determination as
to the right of such Person to receive such payment.  The provisions of Sections 7.01 and 7.02 hereof shall be
applicable to all actions or omissions of actions by the Trustee pursuant to
this Article 10.


 


                SECTION 10.14.  Trustee To Effectuate Subordination.


 


Each
Holder by accepting a Note authorizes and directs the Trustee on his behalf to
take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination between the Holders and the holders of Senior Debt
of the Company as provided in this Article 10 and appoints the Trustee as
attorney-in-fact for any and all such purposes.


 


                SECTION 10.15.  Trustee Not Fiduciary for Holders of
Senior Debt of the Company.


 


The
Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior
Debt of the Company and shall not be liable to any such holders if it shall
mistakenly pay over or distribute to Holders or the Company or any other
Person, money or assets to which any holders of Senior Debt of the Company
shall be entitled by virtue of this Article 10 or otherwise.


 


                SECTION 10.16.  Reliance by Holders of Senior Debt of the
Company on Subordination Provisions.


 


Each
Holder by accepting a Note acknowledges and agrees that the foregoing
subordination provisions are, and are intended to be, an inducement and a
consideration to each holder of any Senior Debt of the Company, whether such
Senior Debt was created or acquired before or after the issuance of the Notes,
to acquire and continue to hold, or to continue to hold, such Senior Debt and
such holder of such Senior Debt shall be deemed conclusively to have relied on
such subordination provisions in acquiring and continuing to hold, or in
continuing to hold, such Senior Debt.


 


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ARTICLE 11



GUARANTEES


 


                SECTION 11.01.  Guarantees.


 


Each
Guarantor hereby unconditionally and irrevocably guarantees, jointly and
severally, to each Holder and to the Trustee and its successors and assigns (a)
the full and punctual payment of principal of and interest on the Notes when
due, whether at maturity, by acceleration, by redemption or otherwise, of all
obligations of the Company under this Indenture (including obligations to the
Trustee) and the Notes, whether for payment of principal of, premium, if any,
or interest on in respect of the Notes and all other monetary obligations of
the Company under this Indenture and the Notes and (b) the full and punctual
performance within applicable grace periods of all other obligations of the
Company under this Indenture and the Notes whether for fees, expenses,
indemnification or otherwise under this Indenture and the Notes (all the
foregoing being hereinafter collectively called the “Guaranteed Obligations”).
Each Guarantor further agrees that the Guaranteed Obligations may be extended
or renewed, in whole or in part, without notice or further assent from each
such Guarantor and that each such Guarantor will remain bound under this
Article 11 notwithstanding any extension or renewal of any Guaranteed
Obligation.


 


Each
Guarantor waives presentation to, demand of, payment from and protest to the
Company of any of the Guaranteed Obligations and also waives notice of protest
for nonpayment.  Each Guarantor waives
notice of any default under the Notes or the Guaranteed Obligations.  The obligations of each Guarantor hereunder
shall not be affected by (a) the failure of any Holder or the Trustee to assert
any claim or demand or to enforce any right or remedy against the Company or
any other Person under this Indenture, the Notes or any other agreement or
otherwise; (b) any extension or renewal of this Indenture, the Notes or any
other agreement; (c) any rescission, waiver, amendment or modification of any
of the terms or provisions of this Indenture, the Notes or any other agreement;
(d) the release of any security held by any Holder or the Trustee for the
Guaranteed Obligations or any Guarantor; (e) the failure of any Holder or the
Trustee to exercise any right or remedy against any other guarantor of the
Obligations; or (f) except as set forth in Section 11.07, any change in
the ownership of such Guarantor.


 


Each
Guarantor hereby waives any right to which it may be entitled to have its
obligations hereunder divided among the Guarantors, such that such Guarantor’s
obligations would be less than the full amount claimed.  Each Guarantor hereby waives any right to
which it may be entitled to have the assets of the Company first be used and
depleted as payment of the Company’s or such Guarantor’s obligations hereunder
prior to any amounts being claimed from or paid by such Guarantor
hereunder.  Each Guarantor hereby waives
any right to which it may be entitled to require that the Company be sued prior
to an action being initiated against such Guarantor.


 


Each
Guarantor further agrees that its Guarantee herein constitutes a guarantee of
payment, performance and compliance when due (and not a guarantee of
collection) and waives any right to require that any resort be had by any
Holder or the Trustee to any security held for payment of the Guaranteed Obligations.


 


Each
Guarantee is, to the extent and in the manner set forth in Article 12
hereof, subordinated and subject in right of payment to the prior payment in
full of the principal of and premium, if any, and interest on all Senior Debt
of the Guarantor giving such Guarantee and each Guarantee is made subject to
such provisions of this Indenture.


 


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Except
as expressly set forth in Sections 11.02 and 11.07 hereof, the obligations of
each Guarantor hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason, including any claim of waiver,
release, surrender, alteration or compromise, and shall not be subject to any
defense of setoff, counterclaim, recoupment or termination whatsoever or by
reason of the invalidity, illegality or unenforceability of the Guaranteed
Obligations or otherwise.  Without
limiting the generality of the foregoing, the obligations of each Guarantor
herein shall not be discharged or impaired or otherwise affected by the failure
of any Holder or the Trustee to assert any claim or demand or to enforce any
remedy under this Indenture, the Notes or any other agreement, by any waiver or
modification of any thereof, by any default, failure or delay, willful or
otherwise, in the performance of the obligations, or by any other act or thing
or omission or delay to do any other act or thing which may or might in any
manner or to any extent vary the risk of such Guarantor or would otherwise
operate as a discharge of such Guarantor as a matter of law or equity.


 


Each
Guarantor further agrees that its Guarantee herein shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of principal of or interest on any Guaranteed Obligation is
rescinded or must otherwise be restored by any Holder or the Trustee upon the
bankruptcy or reorganization of the Company or otherwise.


 


In
furtherance of the foregoing and not in limitation of any other right which any
Holder or the Trustee has at law or in equity against any Guarantor by virtue
hereof, upon the failure of the Company to pay the principal of or interest on
any Guaranteed Obligation when and as the same shall become due, whether at
maturity, by acceleration, by redemption or otherwise, or to perform or comply
with any other Guaranteed Obligation, each Guarantor hereby promises to and
shall, upon receipt of written demand by the Trustee, forthwith pay, or cause
to be paid, in cash, to the Holders or the Trustee an amount equal to the sum
of (1) the unpaid principal amount of such Guaranteed Obligations, (2) accrued
and unpaid interest on such Guaranteed Obligations (but only to the extent not
prohibited by applicable law) and (3) all other monetary obligations of the
Company to the Holders and the Trustee.


 


Each
Guarantor agrees that it shall not be entitled to any right of subrogation in
relation to the Holders in respect of any Guaranteed Obligations guaranteed
hereby until payment in full of all Guaranteed Obligations and all obligations
to which the Guaranteed Obligations are subordinated as provided in
Article 12.  Each Guarantor further
agrees that, as between it, on the one hand, and the Holders and the Trustee,
on the other hand, (x) the maturity of the Guaranteed Obligations may be
accelerated as provided in Article 6 for the purposes of such Guarantor’s
Guarantee herein, notwithstanding any stay, injunction or other prohibition
preventing such acceleration in respect of the Guaranteed Obligations guaranteed
hereby, and (y) in the event of any declaration of acceleration of such
Guaranteed Obligations as provided in Article 6, such Guaranteed
Obligations (whether or not due and payable) shall forthwith become due and
payable by such Guarantor for the purposes of this Section.


 


Each
Guarantor also agrees to pay any and all costs and expenses (including
reasonable attorneys’ fees and expenses) incurred by the Trustee or any Holder
in enforcing any rights under this Section.


 


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Upon
request of the Trustee (which request the Trustee shall under no circumstances
be obligated to make), each Guarantor 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.


 


                SECTION 11.02.  Limitation on Liability.


 


Any
term or provision of this Indenture to the contrary notwithstanding, the
maximum aggregate amount of the Obligations guaranteed hereunder by any
Guarantor shall not exceed the maximum amount that can be hereby guaranteed
without rendering this Indenture, as it relates to such Guarantor, voidable
under applicable law relating to fraudulent conveyance or fraudulent transfer
or similar laws affecting the rights of creditors generally.


 


                SECTION 11.03.  Successors and Assigns.


 


This
Article 11 shall be binding upon each Guarantor and its successors and
assigns and shall inure to the benefit of the successors and assigns of the
Trustee and the Holders and, in the event of any transfer or assignment of
rights by any Holder or the Trustee, the rights and privileges conferred upon
that party in this Indenture and in the Notes shall automatically extend to and
be vested in such transferee or assignee, all subject to the terms and
conditions of this Indenture.


 


                SECTION 11.04.  No Waiver.


 


Neither
a failure nor a delay on the part of either the Trustee or the Holders in
exercising any right, power or privilege under this Article 11 shall
operate as a waiver thereof, nor shall a single or partial exercise thereof
preclude any other or further exercise of any right, power or privilege.  The rights, remedies and benefits of the
Trustee and the Holders herein expressly specified are cumulative and not
exclusive of any other rights, remedies or benefits which either may have under
this Article 11 at law, in equity, by statute or otherwise.


 


                SECTION 11.05.  Modification.


 


No
modification, amendment or waiver of any provision of this Article 11, nor
the consent to any departure by any Guarantor therefrom, shall in any event be
effective unless the same shall be in writing and signed by the Trustee, and
then such waiver or consent shall be effective only in the specific instance
and for the purpose for which given.  No
notice to or demand on any Guarantor in any case shall entitle such Guarantor
to any other or further notice or demand in the same, similar or other
circumstances.


 


                SECTION 11.06.  Guarantors May Consolidate, etc., on
Certain Terms.


 


Each
Guarantor shall not, and the Company shall not permit any such Guarantor to,
consolidate or merge with or into, or sell, assign, transfer, lease, convey or
otherwise dispose of, in a single transaction or series of related
transactions, all or substantially all of its assets to any Person unless:


 


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(1)                                  (except in the case of such Guarantor that
has been disposed of in its entirety to another Person (other than to the
Company or an Affiliate of the Company), whether through a merger,
consolidation or sale of Capital Stock or through the sale of all or
substantially all of its assets (such sale constituting the disposition of such
Guarantor in its entirety), if in connection therewith the Company provides an
Officers’ Certificate to the Trustee to the effect that the Company will comply
with its obligations under Section 4.10 hereof in respect of such
disposition) the resulting, surviving or transferee Person (if not such
Guarantor) shall be a Person organized and validly existing under the laws of
the jurisdiction under which such Guarantor was organized or under the laws of
the United States of America, any State thereof or the District of Columbia,
and such Person shall expressly assume, by a supplemental indenture (in form
and substance satisfactory to the Trustee), executed and delivered to the
Trustee, all the obligations of such Guarantor, if any, under its Guarantee;


 


(2)                                  except in the case of a merger of such
Guarantor with or into the Company or another Restricted Subsidiary of the
Company that is a Guarantor and except in the case of a merger entered into
solely for the purpose of reincorporating such Guarantor in another
jurisdiction, immediately after giving effect to such transaction and the
assumption contemplated by the immediately preceding clause (a)(1) (including,
without limitation, giving effect to any Indebtedness and Acquired Indebtedness
incurred and any Lien granted in connection with or in respect of the
transaction), no Default or Event of Default shall have occurred and be
continuing; and


 


(3)                                  the Company shall have delivered to the
Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that
such consolidation, merger, sale, assignment, transfer, lease, conveyance or
other disposition and, if a supplemental indenture is required in connection
with such transaction, such supplemental indenture comply with the applicable
provisions of this Indenture and that all conditions precedent in the Indenture
relating to such transaction have been satisfied.


 


In
case of any such consolidation, merger, sale or conveyance and upon the
assumption by the successor Person, by supplemental indenture, executed and
delivered to the Trustee and satisfactory in form to the Trustee, of the
Guarantee of the Notes and the due and punctual performance of all of the
covenants and conditions of this Indenture to be performed by the Guarantor,
such successor Person shall succeed to and be substituted for the Guarantor
with the same effect as if it had been named herein as a Guarantor. Such
successor Person thereupon may cause to be signed any or all of the Guarantees
of the Notes issuable hereunder which theretofore shall not have been signed by
the Company and delivered to the Trustee. All the Guarantees so issued shall in
all respects have the same legal rank and benefit under this Indenture as the
Guarantees theretofore and thereafter issued in accordance with the terms of
this Indenture as though all of such Guarantees had been issued at the date of
the execution hereof.


 


                SECTION 11.07.  Release of Guarantor.


 


(a)  Upon the sale (including any sale pursuant
to any exercise of remedies by a holder of Senior Debt of the Company or of
such Guarantor) or other disposition (including by way of consolidation or
merger) of a Guarantor that is a Restricted Subsidiary of the Company or the
sale or disposition of all or substantially all the assets of such Guarantor
(in each case other than


 


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a
sale or disposition to the Company or an Affiliate of the Company and if in
connection therewith the Company provides an Officers’ Certificate to the
Trustee to the effect that the Company will comply with its obligations under
Section 4.10 hereof in respect of such disposition),


 


(b)                                 upon designation of a Guarantor as an
Unrestricted Subsidiary pursuant to the terms of this Indenture, or


 


(c)                                  at such time, and for so long as, (i) the
Company’s Credit Facilities do not require any guarantees of the Domestic
Subsidiaries and (ii) all of the Domestic Subsidiaries have less than $75.0
million of Indebtedness then outstanding owed to Persons other than the Company
or any Restricted Subsidiary, such Guarantor shall be deemed released from all
obligations under this Article 11 without any further action required on
the part of the Trustee or any Holder.


 


If
the Company exercises its Legal Defeasance option or its Covenant Defeasance
option in accordance with the provisions of Article 8 hereof or if its
obligations under this Indenture are discharged in accordance with
Section 8.06 hereof, each Guarantor shall be released from all obligations
under this Article 11 without any further action required on the part of
the Trustee or any Holder.


 


At
the request of the Company, the Trustee shall execute and deliver an
appropriate instrument evidencing the release of a Guarantor pursuant to this
Section 11.07.


 


                SECTION 11.08.  Contribution.


 


Each
Guarantor that makes a payment under its Guarantee shall be entitled upon
payment in full of all Guaranteed Obligations to a contribution from each other
Guarantor in an amount equal to such other Guarantor’s pro rata portion of such
payment based on the respective net assets of all the Guarantors at the time of
such payment determined in accordance with GAAP.


 


                SECTION 11.09.  Execution of Supplemental Indenture for
Future Guarantors.


 


Each
Subsidiary and other Person which is required to become a Guarantor pursuant to
Section 4.17 shall promptly execute and deliver to the Trustee a
supplemental indenture in the form of Exhibit F hereto pursuant to which such
Subsidiary or other Person shall become a Guarantor under this Article 11
and shall guarantee the Guaranteed Obligations.  Concurrently with the execution and delivery of such supplemental
indenture, the Company shall deliver to the Trustee an Opinion of Counsel and
an Officers’ Certificate to the effect that such supplemental indenture has
been duly authorized, executed and delivered by such Subsidiary or other Person
and that, subject to the application of bankruptcy, insolvency, moratorium,
fraudulent conveyance or transfer and other similar laws relating to creditors’
rights generally and to the principles of equity, whether considered in a
proceeding at law or in equity, the Guarantee of such Guarantor is a legal,
valid and binding obligation of such Guarantor, enforceable against such
Guarantor in accordance with its terms and/or to such other matters as the
Trustee may reasonably request.


 


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ARTICLE 12



SUBORDINATION OF GUARANTEES


 


                SECTION 12.01.  Agreement To Subordinate.


 


Each
Guarantor agrees, and each Holder by accepting a Note agrees, that the
Indebtedness evidenced by such Guarantor’s Guarantee is subordinated in right
of payment, to the extent and in the manner provided in this Article 12,
to the prior payment of all existing and future Senior Debt of such Guarantor
and that the subordination is for the benefit of and enforceable by the holders
of such Senior Debt.  The Guaranteed
Obligations of a Guarantor shall in all respects rank pari passu with all other
Senior Subordinated Debt of such Guarantor and only Senior Debt such Guarantor
(including such Guarantor’s Guarantee of Senior Debt of the Company) shall rank
senior to the Guaranteed Obligations of such Guarantor in accordance with the
provisions set forth herein.


 


                SECTION 12.02.  Liquidation, Dissolution, Bankruptcy.


 


Upon
any payment or distribution of the assets of any Guarantor to creditors upon
(i) a total or partial liquidation or a total or partial dissolution of such
Guarantor; (ii) in a bankruptcy, reorganization, insolvency, receivership or
similar proceeding relating to such Guarantor or its property; or (iii) an
assignment for the benefit of creditors or marshaling of such Guarantor’s
assets and liabilities:


 


(1)                                  holders of Senior Debt of such Guarantor
shall be entitled to receive payment in full in cash of such Senior Debt
(including interest accruing after, or which would accrue but for, the
commencement of any proceeding at the rate specified in the applicable Senior
Debt, whether or not a claim for such interest would be allowed) before Holders
shall be entitled to receive any payment pursuant to the Guarantee of such
Guarantor;


 


(2)                                  until the Senior Debt of any Guarantor is
paid in full in cash, any payment or distribution to which Holders would be
entitled but for this Article 12 shall be made to holders of such Senior
Debt as their interests may appear, except that Holders of the Notes may
receive and retain Permitted Junior Securities; and


 


(3)                                  if a distribution is made to Holders of the
Note that, due to the subordination provisions, should not have been made to
them, such Holders of the Notes are required to hold it in trust for the
holders of Senior Debt of such Guarantor and pay it over to them as their
interest may appear.


 


                SECTION 12.03.  Default on Senior Debt of Guarantor.


 


No
Guarantor shall make any payment on its Guarantee or purchase, redeem or
otherwise retire or defease any Notes or other Guaranteed Obligations
(collectively, “pay its Guarantee”) if either of the following (a “Payment
Default”) occurs (1) any Designated Senior Debt of such Guarantor is not paid
in full in cash when due; or (2) any other default on Designated Senior Debt of
such Guarantor occurs and the maturity of such Designated Senior Debt is
accelerated in


 


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accordance with its terms;
unless, in either case, the Payment Default has been cured or waived and any
such acceleration has been rescinded or such Designated Senior Debt has been
paid in full in cash; provided,
however, that any Guarantor shall be entitled to pay its Guarantee
without regard to the foregoing if such Guarantor and the Trustee receive
written notice approving such payment from the Representative of all Designated
Senior Debt with respect to which the Payment Default has occurred and is
continuing.  During the continuance of
any default (other than a Payment Default) with respect to any Designated
Senior Debt of such Guarantor pursuant to which the maturity thereof may be
accelerated immediately without further notice (except such notice as may be
necessary to effect such acceleration) or the expiration of any applicable
grace periods, such Guarantor shall not pay its Guarantee for a period (a
“Payment Blockage Period”) commencing upon the receipt by the Trustee of (with
a copy to such Guarantor) written notice (a “Blockage Notice”) of such default
from the Representative of such Designated Senior Debt specifying an election
to effect a Payment Blockage Period and ending 179 days thereafter.  The Payment Blockage Period shall end
earlier if such Payment Blockage Period is terminated (1) by written notice to
the Trustee and such Guarantor from the Person or Persons who gave such
Blockage Notice; (2) because the default giving rise to such Blockage Notice is
cured, waived or otherwise no longer continuing; or (3) because such Designated
Senior Debt has been discharged or repaid in full in cash. Notwithstanding the
provisions described in the immediately preceding two sentences (but subject to
the provisions contained in the first sentence of this Section), unless the
holders of such Designated Senior Debt giving such Payment Notice or the
Representative of such Designated Senior Debt shall have accelerated the
maturity of such Designated Senior Debt, any Guarantor shall be entitled to
resume payments pursuant to its Guarantee after termination of such Payment
Blockage Period.  No Guarantor shall be
subject to more than one Blockage Period in any consecutive 360-day  period, irrespective of the number of
defaults with respect to Designated Senior Debt of such Guarantor during such
period; provided, however,
that if any Blockage Notice within such 360-day period is given to the Trustee
by or on behalf of any holders of Designated Senior Debt of such Guarantor
(other than the Bank Indebtedness), the Representative of the Bank Indebtedness
shall be entitled to give another Blockage Notice within such period; provided  further,  however,
that in no event shall the total number of days during which any Payment
Blockage Period or Periods is in effect exceed 179 days in the aggregate during
any 360-day consecutive period, and there must be 181 days during any 360-day
consecutive period during which no Payment Blockage Period is in effect.  For purposes of this Section, no default or
event of default which existed or was continuing on the date of the
commencement of any Payment Blockage Period with respect to the Designated
Senior Debt of such Guarantor initiating such Payment Blockage Period shall be,
or be made, the basis of the commencement of a subsequent Payment Blockage
Period by the Representative of such Designated Senior Debt, whether or not
within a period of 360 consecutive days, unless such default or event of
default shall have been cured or waived for a period of not less than 90
consecutive days.


 


                SECTION 12.04.  Demand for Payment.


 


If
a demand for payment is made on a Guarantor pursuant to Article 11 hereof,
the Trustee shall promptly notify the holders of the Designated Senior Debt of
such Guarantor (or their Representatives) of such demand.


 


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                SECTION 12.05.  When Distribution Must Be Paid Over.


 


If
a distribution is made to Holders that because of this Article 12 should
not have been made to them, the Holders who receive the distribution shall hold
it in trust for holders of Senior Debt of the applicable Guarantor and pay it
over to them or their Representatives as their interests may appear.  If any Designated Senior Debt of a Guarantor
is outstanding, such Guarantor shall not make a payment on its Guarantee until
five Business Days after the Representatives of all the issuers of Designated
Senior Debt of such Guarantor receive notice of such acceleration and,
thereafter, shall be entitled to pay the Notes only if this Article 12
otherwise permits payment at that time.


 


                SECTION 12.06.  Subrogation.


 


After
all Senior Debt of a Guarantor is paid in full and until the Notes are paid in
full, Holders shall be subrogated to the rights of holders of such Senior Debt
to receive distributions applicable to Senior Debt of such Guarantor.  A distribution made under this
Article 12 to holders of such Senior Debt which otherwise would have been
made to Holders is not, as between the relevant Guarantor and Holders, a
payment by such Guarantor on such Senior Debt.


 


                SECTION 12.07.  Relative Rights.


 


This
Article 12 defines the relative rights of Holders and holders of Senior
Debt of a Guarantor.  Nothing in this
Indenture shall:


 


(1)                                  impair, as between a Guarantor and Holders,
the obligation of such Guarantor, which is absolute and unconditional, to pay
its Guarantee to the extent set forth in Article 11; or


 


(2)                                  prevent the Trustee or any Holder from
exercising its available remedies upon a default by such Guarantor under its
Guarantee, subject to the rights of holders of Senior Debt of such Guarantor to
receive distributions otherwise payable to Holders.


 


                SECTION 12.08.  Subordination May Not Be Impaired by
Company.


 


No
right of any holder of Senior Debt of any Guarantor to enforce the
subordination of the Guarantee of such Guarantor shall be impaired by any act
or failure to act by such Guarantor or by its failure to comply with this Indenture.


 


                SECTION 12.09.  Rights of Trustee and Paying Agent.


 


Notwithstanding
Section 12.03 or any other provision of this Indenture or the Notes, the
Trustee or Paying Agent shall continue to make payments on any Guarantee and
shall not be charged with knowledge of the existence of facts that would
prohibit the making of any such payments unless, not less than two Business
Days prior to the date of such payment, a Responsible Officer of the Trustee
receives written notice satisfactory to it that such payments may not be made
under this Article 12 and, prior to the receipt of any such written
notice, the Trustee, shall be entitled in all respects conclusively to presume
that no such fact exists.  Unless the Trustee
shall have received the notice provided for in the preceding sentence, the
Trustee shall have full power and authority to receive such payment and to
apply the same to the purpose for which it was received, and shall not be
affected by any notice to the contrary which may be


 


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received
by it on or after such date.  The
foregoing shall not apply to any Affiliate of the Company acting as Paying
Agent.  The Company, the relevant
Guarantor, a Representative or a holder of Senior Debt of such Guarantor shall
be entitled to give such notice; provided,
however, that, if an issue
of Senior Debt of any Guarantor has a Representative, only the Representative
shall be entitled to give the notice.


 


The
Trustee in its individual or any other capacity shall be entitled to hold
Senior Debt of any Guarantor with the same rights it would have if it were not
the Trustee.  The Registrar and the
Paying Agent may do the same with like rights. 
The Trustee shall be entitled to all the rights set forth in this
Article 12 with respect to any Senior Debt of any Guarantor which may at
any time be held by it, to the same extent as any other holder of such Senior
Debt; and nothing in Article 7 shall deprive the Trustee of any of its
rights as such holder.  Notwithstanding
anything in this Article 12 to the contrary, all amounts owed to the
Trustee (including amounts owed pursuant to Sections 6.10 and 7.07 hereof) in
each of its capacities hereunder shall not be subordinated to any Senior Debt
of a Guarantor or otherwise.


 


                SECTION 12.10.  Distribution or Notice to Representative.


 


Whenever
any Person is to make a distribution or give a notice to holders of Senior Debt
of any Guarantor, such Person shall be entitled to make such distribution or
give such notice to their Representative (if any).


 


                SECTION 12.11.  Article 12 Not To Prevent Events of
Default or Limit Right To Demand Payment.


 


The
failure to make a payment pursuant to a Guarantee by reason of any provision in
this Article 12 shall not be construed as preventing the occurrence of a
Default.  Nothing in this
Article 12 shall have any effect on the right of the Holders or the
Trustee to make a demand for payment on any Guarantor pursuant to its
Guarantee.


 


                SECTION 12.12.  Trustee Entitled To Rely.


 


Upon
any payment or distribution pursuant to this Article 12, the Trustee and
the Holders shall be entitled to rely (1) upon any order or decree of a court
of competent jurisdiction in which any proceedings of the nature referred to in
Section 12.02 are pending, (2) upon a certificate of the liquidating
trustee or agent or other Person making such payment or distribution to the
Trustee or to the Holders or (3) upon the Representatives for the holders of
Senior Debt of any Guarantor for the purpose of ascertaining the Persons entitled
to participate in such payment or distribution, the holders of such Senior Debt
and other indebtedness of such Guarantor, the amount thereof or payable
thereon, the amount or amounts paid or distributed thereon and all other facts
pertinent thereto or to this Article 12. 
In the event that the Trustee determines, in good faith, that evidence
is required with respect to the right of any Person as a holder of Senior Debt
of any Guarantor to participate in any payment or distribution pursuant to this
Article 12, the Trustee shall be entitled to request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of Senior Debt of such Guarantor held by such Person, the extent to which such
Person is entitled to participate in such payment or distribution and other
facts pertinent to the rights of such Person under this Article 12, and,
if such evidence is not furnished, the Trustee shall be entitled to defer any
payment to such Person pending


 


94

















 


judicial
determination as to the right of such Person to receive such payment.  The provisions of Sections 7.01 and 7.02
shall be applicable to all actions or omissions of actions by the Trustee
pursuant to this Article 12.


 


                SECTION 12.13.  Trustee To Effectuate Subordination.


 


Each
Holder by accepting a Note authorizes and directs the Trustee on his behalf to
take such action as may be necessary or appropriate to acknowledge or
effectuate the subordination between the Holders and the holders of Senior Debt
of any Guarantor as provided in this Article 12 and appoints the Trustee
as attorney-in-fact for any and all such purposes.


 


                SECTION 12.14.  Trustee Not Fiduciary for Holders of
Senior Debt of Guarantor.


 


The
Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior
Debt of any Guarantor and shall not be liable to any such holders if it shall
mistakenly pay over or distribute to Holders or the Company or any other
Person, money or assets to which any holders of such Senior Debt shall be
entitled by virtue of this Article 12 or otherwise.


 


                SECTION 12.15.  Reliance by Holders of Senior Debt of
Guarantors on Subordination Provisions.


 


Each
Holder by accepting a Note acknowledges and agrees that the foregoing subordination
provisions are, and are intended to be, an inducement and a consideration to
each holder of any Senior Debt of any Guarantor, whether such Senior Debt was
created or acquired before or after the issuance of the Notes, to acquire and
continue to hold, or to continue to hold, such Senior Debt and such holder of
Senior Debt shall be deemed conclusively to have relied on such subordination
provisions in acquiring and continuing to hold, or in continuing to hold, such
Senior Debt.


 


ARTICLE 13



MISCELLANEOUS


 


                SECTION 13.01.  Trust Indenture Act Controls.


 


If
any provision of this Indenture limits, qualifies or conflicts with the duties
imposed by TIA § 318(c), the imposed duties shall control.


 


                SECTION 13.02.  Notices.


 


Any
notice or communication by the Company, any Guarantor or the Trustee to the
others is duly given if in writing and delivered in Person or mailed by first
class mail (registered or certified, return receipt requested), telex,
telecopier or overnight air courier guaranteeing next day delivery, to the
others’ address:


 


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If
to the Company and/or any Guarantor:


 


Polypore,
Inc.

13800 South Lakes Drive

Charlotte, NC  28273

Facsimile No.: (704) 587-8722

Attention: Lynn K. Amos


 


With
copies to:


 


Willkie
Farr & Gallagher LLP

787 Seventh Avenue

New York, NY 10019

Facsimile No.: (212) 728-9228

Attention: William E. Hiller


 


If
to the Trustee:


 


The
Bank of New York

101 Barclay Street, Fl 21 West

New York, New York 10284

Facsimile No.: (212) 815-5802 

Attention:  Global Finance Unit


 


The
Company, any Guarantor or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.


 


All
notices and communications (other than those sent to Holders or the Trustee)
shall be deemed to have been duly given: at the time delivered by hand, if
personally delivered; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next day delivery.
All notices and communications sent to the Trustee shall be deemed to have been
duly given when actually received.


 


Any
notice or communication to a Holder shall be mailed by first class mail,
certified or registered, return receipt requested, or by overnight air courier
guaranteeing next day delivery to its address shown on the register kept by the
Registrar. Any notice or communication shall also be so mailed to any Person
described in TIA § 313(c), to the extent required by the TIA. Failure to
mail a notice or communication to a Holder or any defect in it shall not affect
its sufficiency with respect to other Holders. 
So long as the Euro Notes are listed on the Luxembourg Stock Exchange
and it is required by the rules of the Luxembourg Stock Exchange, such notice
to the Holders of the Euro Notes will be published in English in a leading
newspaper having general circulation in Luxembourg (which is expected to be the
Luxemburger Wort) or, if such
publication is not practicable, in one other leading English language daily
newspaper with general circulation in Europe, such newspaper being published on
each business day in morning editions, whether or not it shall be published in
Saturday, Sunday or holiday editions.


 


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If
a notice or communication is mailed in the manner provided above within the
time prescribed, it is duly given, whether or not the addressee receives it.


 


If
the Company mails a notice or communication to Holders, it shall mail a copy to
the Trustee, each Paying Agent and the Registrar at the same time.


 


                SECTION 13.03.  Communication by Holders of Notes with
Other Holders of Notes.


 


Holders
may communicate pursuant to TIA § 312(b) with other Holders with respect
to their rights under this Indenture or the Notes. The Company, the Trustee,
the Registrar and anyone else shall have the protection of TIA § 312(c).


 


                SECTION 13.04.  Certificate and Opinion as to Conditions
Precedent.


 


Upon
any request or application by the Company to the Trustee to take any action
under this Indenture, the Company shall furnish to the Trustee:


 


(a)                                  an Officers’ Certificate in form reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 13.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been complied with; and


 


(b)                                 an Opinion of Counsel in form reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 13.05 hereof) stating that, in the opinion of such counsel, all
such conditions precedent and covenants have been  complied with.


 


                SECTION 13.05.  Statements Required in Certificate or
Opinion.


 


Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture (other than a certificate provided pursuant to
TIA § 314(a)(4)) shall comply with the provisions of TIA § 314(e) and
shall include:


 


(a)                                  a statement that the Person making such
certificate or opinion has read such covenant or condition;


 


(b)                                 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;


 


(c)                                  a statement that, in the opinion of such
Person, he or she has or they have 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


 


(d)                                 a statement as to whether or not, in the
opinion of such Person, such condition or covenant has been complied with.


 


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                SECTION 13.06.  Rules by Trustee and Agents.


 


The
Trustee may make reasonable rules for action by or at a meeting of Holders. The
Registrar or Paying Agent may make reasonable rules and set reasonable requirements
for its functions.


 


                SECTION 13.07.  Governing Law.


 


THE
INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS
INDENTURE, THE NOTES AND THE GUARANTEES WITHOUT GIVING EFFECT TO APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS
OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.


 


                SECTION 13.08.  No Adverse Interpretation of Other
Agreements.


 


This
Indenture may not be used to interpret any other indenture, loan or debt
agreement of the Company or its Subsidiaries or of any other Person. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture.


 


                SECTION 13.09.  Successors.


 


All
agreements of the Company and the Guarantors in this Indenture and the Notes shall
bind their respective successors. All agreements of the Trustee in this
Indenture shall bind its successors.


 


                SECTION 13.10.  Severability.


 


In
case any provision in this Indenture or in the Notes shall be invalid, illegal
or unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.


 


                SECTION 13.11.  Counterpart Originals.


 


The
parties may sign any number of copies of this Indenture. Each signed copy shall
be an original, but all of them together represent the same agreement.


 


                SECTION 13.12.  Table of Contents, Headings, etc.


 


The
Table of Contents, Cross-Reference Table and Headings of the Articles and
Sections of this Indenture have been inserted for convenience of reference
only, are not to be considered a part of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof.


 


                SECTION 13.13.  Currency of Account; Conversion of
Currency; Foreign Exchange Restrictions.


 


(a)                                  U.S. Dollars are the sole currency of account
and payment for all sums payable by the Company and the Guarantors under or in
connection with the Dollar Notes, the Guarantees of the Dollar Notes or this
Indenture to the extent it relates to the Dollar Notes, including damages
related thereto, and Euros are the sole currency of account and payment for all
sums payable by the Company and the Guarantors under or in connection with the
Euro Notes, the Guarantees of


 


98

















 


the
Euro Notes or this Indenture to the extent it relates to the Euro Notes,
including damages related thereto.  Any
amount received or recovered in a currency other than U.S. Dollars by a Holder
of Dollar Notes or Euro by a Holder of Euro Notes (whether as a result of, or
of the enforcement of, a judgment or order of a court of any jurisdiction, in
the winding-up or dissolution of the Company or otherwise) in respect of any
sum expressed to be due to it from the Company shall only constitute a
discharge to the Company to the extent of the U.S. Dollar or Euro amount, as
the case may be, which the recipient is able to purchase with the amount so
received or recovered in that other currency on the date of that receipt or
recovery (or, if it is not practicable to make that purchase on that date, on
the first date on which it is practicable to do so).  If that U.S. Dollar or Euro amount is less than the U.S. Dollar
or Euro amount expressed to be due to the recipient under the applicable Notes,
the Company shall indemnify it against any loss sustained by it as a result as
set forth in Section 13.13(b).  In
any event, the Company and the Guarantors shall indemnify the recipient against
the cost of making any such purchase. 
For the purposes of this Section 13.13, it will be sufficient for
the Holder of a Note to certify in a satisfactory manner (indicating sources of
information used) that it would have suffered a loss had an actual purchase of
U.S. Dollars or Euros, as the case may be, been made with the amount so
received in that other currency on the date of receipt or recovery (or, if a
purchase of U.S. Dollars or Euros, as applicable, on such date had not been
practicable, on the first date on which it would have been practicable, it
being required that the need for a change of date be certified in the manner
mentioned above).  The indemnities set
forth in this Section 13.13 constitute separate and independent
obligations from other obligations of the Company and the Guarantors, shall
give rise to a separate and independent cause of action, shall apply
irrespective of any indulgence granted by any Holder of the Notes and shall
continue in full force and effect despite any other judgment, order, claim or
proof for a liquidated amount in respect of any sum due under the Notes.


 


(b)                                 The Company and the Guarantors, jointly and
severally, covenant and agree that the following provisions shall apply to
conversion of currency in the case of the Notes, the Guarantees and this
Indenture:


 


(1)                                  (A)                              If for the purpose of obtaining judgment in, or enforcing the judgment
of, any court in any country, it becomes necessary to convert into a currency
(the “Judgment Currency”) an amount due in any other currency (the “Base
Currency”), then the conversion shall be made at the rate of exchange prevailing
on the Business Day before the day on which the judgment is given or the order
of enforcement is made, as the case may be (unless a court shall otherwise
determine).


 


(B)                                If there is a change in the rate of exchange
prevailing between the Business Day before the day on which the judgment is
given or an order of enforcement is made, as the case may be (or such other
date as a court shall determine), and the date of receipt of the amount due,
the Company and the Guarantors will pay such additional (or, as the case may
be, such lesser) amount, if any, as may be necessary so that the amount paid in
the Judgment Currency when converted at the rate of exchange prevailing on the
date of receipt will produce the amount in the Base Currency originally due.


 


(2)                                  In the event of the winding-up of the Company
or any Guarantor at any time while any amount or damages owing under the Notes,
the Guarantees and this Indenture, or any


 


99

















 


judgment or order rendered
in respect thereof, shall remain outstanding, the Company and the Guarantors
shall indemnify and hold the Holders and the Trustee harmless against any
deficiency arising or resulting from any variation in rates of exchange between
(i) the date as of which the Applicable Currency Equivalent of the amount due
or contingently due under the Notes, the Guarantees and this Indenture (other
than under this subsection (b)(2)) is calculated for the purposes of such
winding-up and (ii) the final date for the filing of proofs of claim in such
winding-up.  For the purpose of this
subsection (b)(2), the final date for the filing of proofs of claim in the
winding-up of the Company or any Guarantor shall be the date fixed by the liquidator
or otherwise in accordance with the relevant provisions of applicable law as
being the latest practicable date as at which liabilities of the Company or
such Guarantor may be ascertained for such winding-up prior to payment by the
liquidator or otherwise in respect thereto.


 


(c)                                  The obligations contained in subsections (a),
(b)(1)(B) and (b)(2) of this Section 13.13 shall constitute separate and
independent obligations from the other obligations of the Company and the
Guarantors under this Indenture, shall give rise to separate and independent
causes of action against the Company and the Guarantors, shall apply
irrespective of any waiver or extension granted by any Holder or the Trustee or
either of them from time to time and shall continue in full force and effect
notwithstanding any judgment or order or the filing of any proof of claim in
the winding-up of the Company or any Guarantor for a liquidated sum in respect
of amounts due hereunder (other than under subsection (b)(2) above) or
under any such judgment or order.  Any
such deficiency as aforesaid shall be deemed to constitute a loss suffered by
the Holders or the Trustee, as the case may be, and no proof or evidence of any
actual loss shall be required by the Company or any Guarantor or the liquidator
or otherwise or any of them.  In the
case of subsection (b)(2) above, the amount of such deficiency shall not
be deemed to be reduced by any variation in rates of exchange occurring between
the said final date and the date of any liquidating distribution.


 


(d)                                 The term “rate(s) of exchange” shall mean the
rate of exchange quoted by Reuters at 10:00 a.m. (New York time) for spot
purchases of the Base Currency with the Judgment Currency other than the Base
Currency referred to in subsections (b)(1) and (b)(2) above and includes any
premiums and costs of exchange payable.


 


100

















 


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


 


	
   

  	
  PP ACQUISITION CORPORATION,

  to be merged with and into, POLYPORE, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
  /s/
  Lynn Amos

  	
   

  
	
   

  	
   

  	
  Name:
  Lynn Amos

  
	
   

  	
   

  	
  Title:  Chief Financial Officer, Treasurer and

  Secretary

  



 


101

















 


	
   

  	
  DARAMIC, INC., a Delaware corporation

  
	
   

  	
  CELGARD, INC., a Delaware corporation

  
	
   

  	
  POLYPORE HOLDINGS, INC., a Delaware

  corporation

  
	
   

  	
  DARAMIC INTERNATIONAL, INC., a Delaware

  corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Lynn Amos

  	
   

  
	
   

  	
   

  	
  Name:
  Lynn Amos

  
	
   

  	
   

  	
  Title:
  Executive Vice President, Chief Financial Officer, Treasurer and Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  THE BANK OF NEW YORK,

  as Trustee,

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
     /s/
  Miriam Y. Molina

  	
   

  
	
   

  	
   

  	
  Name:
  Miriam Y. Molina

  
	
   

  	
   

  	
  Title:
  Assistant Vice President

  



 


102

















 


The
undersigned hereby acknowledges and agrees that, upon the effectiveness of the
merger of PP Acquisition Corporation with and into Polypore, Inc. with
Polypore, Inc. continuing as the surviving corporation, it will succeed by
operation of law to all of the rights and obligations of PP Acquisition
Corporation set forth herein and that all references herein to the “Company”
shall thereupon be deemed to be references to the undersigned.


 


	
   

  	
  POLYPORE,
  INC.,

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
     /s/
  Lynn Amos

  	
   

  
	
   

  	
   

  	
  Name:
  Lynn Amos

  
	
   

  	
   

  	
  Title:
  Executive Vice President, Chief Financial

  Officer, Treasurer and Secretary

  
				



 


103

















 


RULE 144A/REGULATION S APPENDIX


 


PROVISIONS RELATING TO INITIAL NOTES, 

ADDITIONAL NOTES AND EXCHANGE NOTES


 


1.                                       Definitions


 


1.1                                 Definitions


 


For
the purposes of this Appendix the following terms shall have the meanings
indicated below:


 


“Clearstream”
means Clearstream Banking, société anonyme, or any successor securities
clearing agency.


 


“Common
Depository” means, with respect to the Euro Notes, The Bank of New York
Depository (Nominees) Limited as common depository for Euroclear and
Clearstream or another Person designated as common depository by the Company,
which Person must be a clearing agency registered under the Exchange Act.


 


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


 


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


 


“Definitive
Notes” means, collectively, Definitive Dollar Notes and Definitive Euro Notes.


 


“Depository”
means, respect to the Dollar Notes, The Depository Trust Company, its nominees
and their respective successors.


 


“Euroclear”
means the Euroclear Clearance System or any successor securities clearing
agency.


 


“Global
Notes Legend” means the legend set forth under that caption in the applicable
Exhibit to this Indenture.


 


“IAI”
means an institutional “accredited investor” as described in Rule 501(a)(1),
(2), (3) or (7) under the Securities Act.


 


“Initial
Purchasers” means (1) with respect to the Initial Notes issued on the Issue
Date, J.P. Morgan Securities Inc., Bear, Stearns & Co. Inc., UBS Securities
LLC and Lehman Brothers Inc. (in the case of the Initial Dollar Notes) and J.P.
Morgan Securities Ltd., Bear, Stearns International Limited, UBS Limited and
Lehman Brothers International (in the case of the Initial


 

















 


Euro
Notes) and (2) with respect to each issuance of Additional Notes, the Persons
purchasing or underwriting such Additional Notes under the related Purchase
Agreement.


 


“Purchase
Agreement” means with (1) respect to the Initial Notes issued on the Issue
Date, the Purchase Agreement dated May 6, 2004, among the Company, PP
Acquisition Corporation and the Initial Purchasers, and (2) with respect to
each issuance of Additional Notes, the purchase agreement or underwriting
agreement among the Company and the Persons purchasing or underwriting such
Additional Notes.


 


“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 Notes, to issue and deliver to
such Holders, in exchange for the Initial Notes, a like aggregate principal
amount of Exchange Notes registered under the Securities Act.


 


“Registration
Rights Agreement” means (1) with respect to the Initial Notes issued on the
Issue Date, the Registration Rights Agreement dated May 13, 2004, among the
Company, the Guarantors and the Initial Purchasers, and (2) with respect to
each issuance of Additional Notes issued in a transaction exempt from the
registration requirements of the Securities Act, the registration rights
agreement, if any, among the Company, the Guarantors and the Persons purchasing
such Additional Notes under the related Purchase Agreement.


 


“Regulation
S” means Regulation S under the Securities Act.


 


“Regulation
S Notes” means all Initial Notes offered and sold outside the United States in
reliance on Regulation S.


 


“Restricted
Period”, with respect to any Notes, means the period of 40 consecutive days
beginning on and including the later of (a) the day on which such Notes are
first offered to persons other than distributors (as defined in Regulation S
under the Securities Act) in reliance on Regulation S, notice of which day
shall be promptly given by the Company to the Trustee, and (b) the Issue Date,
and with respect to any Additional Notes that are Transfer Restricted Notes, it
means the comparable period of 40 consecutive days.


 


“Restricted
Notes Legend” means the legend set forth in Section 2.2(f)(i) herein.


 


“Rule
501” means Rule 501(a)(1), (2), (3) or (7) under the Securities Act.


 


“Rule
144A” means Rule 144A under the Securities Act.


 


“Rule
144A Notes” means all Initial Notes offered and sold to QIBs in reliance on
Rule 144A.


 


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


 


“Notes”
means the Initial Notes and the Exchange Notes treated as a single class.


 


2

















 


“Securities
Custodian” means the custodian with respect to a Global Note (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 Notes pursuant to a
Registration Rights Agreement.


 


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


 


“Unrestricted
Definitive Note” means Definitive Notes and any other Notes that are not
required to bear, or are not subject to, the Restricted Notes Legend.


 


1.2                                 Other Definitions


 


	
  Term:

  	
   

  	
  Defined in Section:

  
	
  “Agent
  Members”

  	
   

  	
  2.1(b)

  
	
  “Global
  Dollar Notes”

  	
   

  	
  2.1(b)

  
	
  “Global
  Euro Notes”

  	
   

  	
  2.1(b)

  
	
  “Global
  Notes”

  	
   

  	
  2.1(b)

  
	
  “Regulation
  S Global Dollar Notes”

  	
   

  	
  2.1(b)

  
	
  “Regulation
  S Global Euro Notes”

  	
   

  	
  2.1(b)

  
	
  “Regulation
  S Global Notes”

  	
   

  	
  2.1(b)

  
	
  “Rule
  144A Global Dollar Note”

  	
   

  	
  2.1(b)

  
	
  “Rule
  144A Global Euro Note”

  	
   

  	
  2.1(b)

  
	
  “Rule
  144A Global Notes”

  	
   

  	
  2.1(b)

  



 


2.                                       The Notes.


 


2.1                                 Form and Dating; Global Notes.  (a)
The Initial Notes issued on the date hereof will be (i) offered and sold by the
Company pursuant to the Purchase Agreement and (ii) resold, initially only to
(1) QIBs in reliance on Rule 144A and (2) Persons other than U.S. Persons (as
defined in Regulation S) in reliance on Regulation S.  Such Initial Notes may thereafter be transferred to, among
others, QIBs, purchasers in reliance on Regulation S and, except as set forth
below, IAIs in accordance with Rule 501. 
Additional Notes offered after the date hereof may be offered and sold
by the Company from time to time pursuant to one or more Purchase Agreements in
accordance with applicable law.


 


(b)                                 Global Notes. 
(i)  Rule 144A Notes that are
Dollar Notes initially shall be represented by one or more Notes in definitive,
fully registered, global form without interest coupons (collectively, the “Rule
144A Global Dollar Notes”).  Rule
144A Notes that are Euro Notes initially shall be represented by one or more
Notes in definitive, fully registered, global form without interest coupons
(collectively, the “Rule 144A Global Euro Notes” and, together with the
Rule 144A Global Dollar Notes, the “Rule 144A Global Notes”).  Regulation S Notes that are Dollar Notes
initially shall be represented by one or more Notes in fully registered,
global form without interest coupons (collectively, the “Regulation S Global
Dollar Notes”).  Regulation S Notes
that are Euro Notes initially shall be represented by one or more Notes in


 


3

















 


fully
registered, global form without interest coupons (collectively, the “Regulation
S Global Euro Notes” and, together with the Regulation S Global Dollar
Notes, the “Regulation S Global Notes”).  The term “Global Dollar Notes” means the Rule 144A Global
Dollar Notes and the Regulation S Global Dollar Notes.  The term “Global Euro Notes” means,
collectively, the Rule 144A Global Euro Notes and the Regulation S Global Euro
Notes.  The term “Global Notes”
means, collectively, the Rule 144A Global Notes and the Regulation S Global
Notes.  The Global Notes shall bear the
Global Note Legend.  The Global Dollar
Notes initially shall (i) be registered in the name of the Depository or the
nominee of such Depository, in each case for credit to an account of an Agent
Member, (ii) be delivered to the Trustee as custodian for such Depository and
(iii) bear the Restricted Notes Legend. 
The Global Euro Notes initially shall (i) be registered in the name of
the Common Depository or the nominee of such Common Depository, in each case
for credit to an account of an Agent Member, (ii) be delivered to the Euro
Paying Agent as custodian for such Common Depository and (iii) bear the
Restricted Notes Legend.


 


Members
of, or direct or indirect participants in, the Depository, Euroclear or
Clearstream (“Agent Members”) shall have no rights under this Indenture
with respect to any Global Note held on their behalf by the Depository or the
Common Depository, or the Trustee as its custodian, or under the Global
Notes.  The Depository may be treated by
the Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner of the Global Dollar Notes for all purposes whatsoever.  The Common Depository may be treated by the
Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner of the Global Euro Notes 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 the Common Depository, as the case
may be, or impair, as between the Depository, Euroclear or Clearstream, as the
case may be, and their respective Agent Members, the operation of customary
practices governing the exercise of the rights of a Holder of any Note.


 


(ii)                                  Transfers of Global Dollar Notes shall be
limited to transfer in whole, but not in part, to the Depository, its
successors or their respective nominees. 
Transfers of Global Euro Notes shall be limited to transfer in whole,
but not in part, to the Common Depository, its successor and their respective
nominees.  Interests of beneficial
owners in the Global Notes may be transferred or exchanged for Definitive Notes
only in accordance with the applicable rules and procedures of the Depository,
Euroclear or Clearstream, as the case may be, and the provisions of Section 2.2.
 In addition, a Global Note shall be
exchangeable for Definitive Notes if (i) in the case of a Global Dollar Note,
the Depository (x) notifies the Company that it is unwilling or unable to
continue as depository for such Global Note and the Company thereupon fails to
appoint a successor depository or (y) has ceased to be a clearing agency
registered under the Exchange Act, (ii) in the case of a Global Euro Note, (x)
Euroclear or Clearstream notifies the Company that it is unwilling or unable to
continue as clearing agency or (y) the Common Depository notifies the Company
that it is unwilling or unable to continue as common depository for such Global
Euro Note and the Company fails to appoint a successor common depository within
120 days of such notice or (iii) in the case of any Global Note, there shall
have occurred and be continuing an Event of Default with respect to such Global
Note.  In all cases, Definitive Notes
delivered in exchange for any Global Note or beneficial interests therein shall
be registered in the names, and issued in any approved denominations, requested
by or on behalf of 


 


4

















 


the
Depository or the Common Depository, as applicable, in accordance with its
customary procedures.


 


(iii)                               In connection with the transfer of a Global
Note as an entirety to beneficial owners pursuant to subsection (i) of
this Section 2.1(b), such Global Note shall be deemed to be surrendered to
the Trustee for cancellation, and the Company shall execute, and the Trustee
shall authenticate and make available for delivery, to each beneficial owner
identified by the Depository in writing in exchange for its beneficial interest
in such Global Note, an equal aggregate principal amount of Definitive Notes of
authorized denominations.


 


(iv)                              Any Transfer Restricted Note delivered in
exchange for an interest in a Global Note pursuant to Section 2.2 shall,
except as otherwise provided in Section 2.2, bear the Restricted Notes
Legend.


 


(v)                                 Notwithstanding the foregoing, through the
Restricted Period, a beneficial interest in such Regulation S Global Note may
be held only through Euroclear or Clearstream unless delivery is made in
accordance with the applicable provisions of Section 2.2.


 


(vi)                              The Holder of any Global Note may grant
proxies and otherwise authorize any Person, including Agent Members and Persons
that may hold interests through Agent Members, to take any action which a
Holder is entitled to take under this Indenture or the Notes.


 


2.2                                 Transfer and Exchange.


 


(a)                                  Transfer and Exchange of Global Notes.  A
Global Note may not be transferred as a whole except as set forth in
Section 2.1(b).  Global Notes will
not be exchanged by the Company for Definitive Notes except under the
circumstances described in Section in Section 2.1(b)(ii).  Global Notes also may be exchanged or
replaced, in whole or in part, as provided in Sections 2.07 and 2.10 of this
Indenture.  Beneficial interests in a
Global Note may be transferred and exchanged as provided in Section 2.2(b)
or 2.2(g).


 


(b)                                 Transfer and Exchange of Beneficial Interests
in Global Notes.  The transfer and exchange of beneficial
interests in the Global Dollar Notes shall be effected through the Depository,
in accordance with the provisions of this Indenture and the applicable rules
and procedures of the Depository.  The
transfer and exchange of beneficial interests in the Global Euro Notes shall be
effected through the Common Depository, in accordance with the provisions of
this Indenture and the applicable rules and procedures of Euroclear and
Clearstream.  Beneficial interests in
Restricted Global Notes shall be subject to restrictions on transfer comparable
to those set forth herein to the extent required by the Securities Act.  Beneficial interests in Global Dollar Notes
shall be transferred or exchanged only for beneficial interests in Global
Dollar Notes.  Beneficial interests in
Global Euro Notes shall be transferred or exchanged only for beneficial
interests in Global Euro Notes. 
Transfers and exchanges of beneficial interests in the Global Notes also
shall require compliance with either subparagraph (i) or (ii) below, as
applicable, as well as one or more of the other following subparagraphs, as
applicable:


 


(i)                                     Transfer of Beneficial Interests in the Same
Global Note.  Beneficial interests in any Restricted Global
Note may be transferred to Persons who take delivery thereof


 


5

















 


in
the form of a beneficial interest in the same Restricted Global Note in
accordance with the transfer restrictions set forth in the Restricted Notes
Legend; provided, however, that prior to the expiration
of the Restricted Period, transfers of beneficial interests in a Regulation S
Global Note may not be made to a U.S. Person or for the account or benefit of a
U.S. Person (other than an Initial Purchaser). 
A beneficial interest in an Unrestricted Global Dollar Note may be
transferred to Persons who take delivery thereof in the form of a beneficial
interest in an Unrestricted Global Dollar Note.  Beneficial interests in any Unrestricted Global Euro Note may be
transferred to Persons who take delivery thereof in the form of a beneficial
interest in an Unrestricted Global Euro Note. 
No written orders or instructions shall be required to be delivered to
the Registrar to effect the transfers described in this Section 2.2(b)(i).


 


(ii)                                  All Other Transfers and Exchanges of
Beneficial Interests in Global Notes.  In connection with all
transfers and exchanges of beneficial interests in any Global Dollar Note that
is not subject to Section 2.2(b)(i), the transferor of such beneficial
interest must deliver to the Registrar (1) a written order from an Agent Member
given to the Depository in accordance with the applicable rules and procedures
of the Depository directing the Depository to credit or cause to be credited a
beneficial interest in another Global Dollar Note in an amount equal to the
beneficial interest to be transferred or exchanged and (2) instructions given
in accordance with the applicable rules and procedures of the Depository
containing information regarding the Agent Member account to be credited with
such increase.  In connection with all
transfers and exchanges of beneficial interests in any Global Euro Note that is
not subject to Section 2.2(b)(i), the transferor of such beneficial
interest must deliver to the Registrar (1) a written order from an Agent Member
given to the Common Depository in accordance with the applicable rules and
procedures of Euroclear or Clearstream directing the Common Depository to
credit or cause to be credited a beneficial interest in another Global Euro
Note in an amount equal to the beneficial interest to be transferred or
exchanged and (2) instructions given in accordance with the applicable rules
and procedures of Euroclear or Clearstream containing information regarding the
Agent Member account to be credited with such increase.  Upon satisfaction of all of the requirements
for transfer or exchange of beneficial interests in Global Notes contained in
this Indenture and the Notes or otherwise applicable under the Securities Act,
the Trustee shall adjust the principal amount of the relevant Global Note
pursuant to Section 2.2(g).


 


(iii)                               Transfer of Beneficial Interests to Another
Restricted Global Note.  A beneficial interest in (x) a Transfer
Restricted Global Dollar Note may be transferred to a Person who takes delivery
thereof in the form of a beneficial interest in another Transfer Restricted
Global Dollar Note and (y) a Transfer Restricted Global Euro Note may be transferred
to a Person who takes delivery thereof in the form of a beneficial interest in
another Transfer Restricted Global Euro Note, in each case if the transfer
complies with the requirements of Section 2.2(b)(ii) above and the
Registrar receives the following:


 


(A)                              if the transferee will take delivery in the form of a beneficial
interest in a Rule 144A Global Note, then the transferor must deliver a
certificate in the form attached to the applicable Note; and


 


(B)                                if the transferee will take delivery in the form of a beneficial
interest in a Regulation S Global Note, then the transferor must deliver a
certificate in the form attached to the applicable Note.


 


6

















 


(iv)                              Transfer and Exchange of Beneficial Interests
in a Transfer Restricted Global Note for Beneficial Interests in an
Unrestricted Global Note.  A beneficial
interest in (x) a Transfer Restricted Global Dollar Note may be exchanged by
any holder thereof for a beneficial interest in an Unrestricted Global Dollar
Note or transferred to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Dollar Note or (y) a Restricted
Global Euro Note may be exchanged by any holder thereof for a beneficial
interest in an Unrestricted Global Euro Note or transferred to a Person who
takes delivery thereof in the form of a beneficial interest in an Unrestricted
Global Euro Note, in each case if the exchange or transfer complies with the
requirements of Section 2.2(b)(ii) above and the Registrar receives the
following:


 


(A)                              if the holder of such beneficial interest in a Restricted Global Note
proposes to exchange such beneficial interest for a beneficial interest in an
Unrestricted Global Note, a certificate from such holder in the form attached
to the applicable Note; or


 


(B)                                if the holder of such beneficial interest in a Restricted Global Note
proposes to transfer such beneficial interest to a Person who shall take
delivery thereof in the form of a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form attached to the applicable
Note,


 


and,
in each such case, if the Registrar so requests or if the applicable rules and
procedures of the Depository, Euroclear or Clearstream, as applicable, so
require, an Opinion of Counsel in form reasonably acceptable to the Registrar
to the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein and in
the Restricted Notes Legend are no longer required in order to maintain
compliance with the Securities Act.  If
any such transfer or exchange is effected pursuant to this subparagraph (iv) at
a time when an Unrestricted Global Note has not yet been issued, the Company
shall issue and, upon receipt of an written order of the Company in the form of
an Officers’ Certificate in accordance with Section 2.02, the Trustee
shall authenticate one or more Unrestricted Global Notes in an aggregate
principal amount equal to the aggregate principal amount of beneficial
interests transferred or exchanged pursuant to this subparagraph (iv).


 


(v)                                 Transfer and Exchange of Beneficial Interests
in an Unrestricted Global Note for Beneficial Interests in a Restricted Global
Note.  Beneficial interests in an
Unrestricted Global Note cannot be exchanged for, or transferred to Persons who
take delivery thereof in the form of, a beneficial interest in a Restricted
Global Note.


 


(c)                                  Transfer and Exchange of Beneficial Interests
in Global Notes for Definitive Notes.  A beneficial interest in a
Global Note may not be exchanged for a Definitive Note except under the
circumstances described in Section 2.1(b)(ii).  A beneficial interest in a Global Note may not be transferred to
a Person who takes delivery thereof in the form of a Definitive Note except
under the circumstances described in Section 2.1(b)(ii).  In any case, beneficial interests in Global
Dollar Notes shall be transferred or exchanged only for Definitive Dollar Notes
and beneficial interests in Global Euro Notes shall be transferred or exchanged
only for Definitive Euro Notes.


 


7

















 


(d)                                 Transfer and Exchange of Definitive Notes for
Beneficial Interests in Global Notes.  Definitive Dollar Notes shall
be transferred or exchanged only for beneficial interests in Global Dollar
Notes.  Definitive Euro Notes shall be
transferred or exchanged only for beneficial interests in Global Euro
Notes.  Transfers and exchanges of
beneficial interests in the Global Notes also shall require compliance with
either subparagraph (i), (ii) or (ii) below, as applicable:


 


(i)                                     Transfer Restricted Notes to Beneficial
Interests in Restricted Global Notes.  If any Holder of a Transfer
Restricted Note proposes to exchange such Transfer Restricted Note for a
beneficial interest in a Restricted Global Note or to transfer such Transfer
Restricted Note to a Person who takes delivery thereof in the form of a
beneficial interest in a Restricted Global Note, then, upon receipt by the
Registrar of the following documentation:


 


(A)                              if the Holder of such Transfer Restricted Note proposes to exchange
such Transfer Restricted Note for a beneficial interest in a Restricted Global
Note, a certificate from such Holder in the form attached to the applicable
Note;


 


(B)                                if such Transfer Restricted Note is being transferred to a Qualified
Institutional Buyer in accordance with Rule 144A under the Securities Act, a
certificate from such Holder in the form attached to the applicable Note;


 


(C)                                if such Transfer Restricted Note is being transferred to a Non-U.S.
Person in an offshore transaction in accordance with Rule 903 or Rule 904 under
the Securities Act, a certificate from such Holder in the form attached to the
applicable Note;


 


(D)                               if such Transfer Restricted Note is being transferred pursuant to an
exemption from the registration requirements of the Securities Act in
accordance with Rule 144 under the Securities Act, a certificate from such
Holder in the form attached to the applicable Note;


 


(E)                                 if such Transfer Restricted Note is being
transferred to an Institutional Accredited Investor in reliance on an exemption
from the registration requirements of the Securities Act other than those
listed in subparagraphs (B) through (D) above, a certificate from such Holder
in the form attached to the applicable Note, including the certifications,
certificates and Opinion of Counsel, if applicable; or


 


(F)                                 if such Transfer Restricted Note is being
transferred to the Company or a Subsidiary thereof, a certificate from such
Holder in the form attached to the applicable Note;


 


the
Trustee shall cancel the Transfer Restricted Note, and increase or cause to be
increased the aggregate principal amount of 
the appropriate Restricted Global Note.


 


(ii)                                  Transfer Restricted Notes to Beneficial
Interests in Unrestricted Global Notes.  A Holder of a Transfer
Restricted Note may exchange such Transfer Restricted


 


8

















 


Definitive
Note for a beneficial interest in an Unrestricted Global Note or transfer such
Transfer Restricted Note to a Person who takes delivery thereof in the form of
a beneficial interest in an Unrestricted Global Note only if the Registrar
receives the following:


 


(A)                              if the Holder of such Transfer Restricted Note proposes to exchange
such Transfer Restricted Note for a beneficial interest in an Unrestricted
Global Note, a certificate from such Holder in the form attached to the
applicable Note; or


 


(B)                                if the Holder of such Transfer Restricted Notes proposes to transfer
such Transfer Restricted Note to a Person who shall take delivery thereof in
the form of a beneficial interest in an Unrestricted Global Note, a certificate
from such Holder in the form attached to the applicable Note,


 


and,
in each such case, if the Registrar so requests or if the applicable rules and
procedures of the Depository, Euroclear or Clearstream, as applicable, so
require, an Opinion of Counsel in form reasonably acceptable to the Registrar
to the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein and in
the Restricted Notes Legend are no longer required in order to maintain
compliance with the Securities Act. 
Upon satisfaction of the conditions of this subparagraph (ii), the
Trustee shall cancel the Transfer Restricted Notes and increase or cause to be
increased the aggregate principal amount of the Unrestricted Global Note.  If any such transfer or exchange is effected
pursuant to this subparagraph (ii) at a time when an Unrestricted Global Note
has not yet been issued, the Company shall issue and, upon receipt of an
written order of the Company in the form of an Officers’ Certificate, the
Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate
principal amount equal to the aggregate principal amount of Transfer Restricted
Notes transferred or exchanged pursuant to this subparagraph (ii).


 


(iii)                               Unrestricted Definitive Notes to Beneficial
Interests in Unrestricted Global Notes.  A Holder of an Unrestricted
Definitive Note may exchange such Unrestricted Definitive Note for a beneficial
interest in an Unrestricted Global Note or transfer such Unrestricted
Definitive Note to a Person who takes delivery thereof in the form of a
beneficial interest in an Unrestricted Global Note at any time.  Upon receipt of a request for such an
exchange or transfer, the Trustee shall cancel the applicable Unrestricted
Definitive Note and increase or cause to be increased the aggregate principal
amount of one of the Unrestricted Global Notes.  If any such transfer or exchange is effected pursuant to this
subparagraph (iii) at a time when an Unrestricted Global Note has not yet been
issued, the Company shall issue and, upon receipt of an written order of the
Company in the form of an Officers’ Certificate, the Trustee shall authenticate
one or more Unrestricted Global Notes in an aggregate principal amount equal to
the aggregate principal amount of Unrestricted Definitive Notes transferred or
exchanged pursuant to this subparagraph (iii).


 


(iv)                              Unrestricted Definitive Notes to Beneficial
Interests in Restricted Global Notes.  An Unrestricted Definitive
Note cannot be exchanged for, or transferred to a Person who takes delivery
thereof in the form of, a beneficial interest in a Restricted Global Note.


 


9

















 


(e)                                  Transfer and Exchange of Definitive Notes for
Definitive Notes.  Upon request by a Holder of Definitive Notes
and such Holder’s compliance with the provisions of this Section 2.2(e),
the Registrar shall register the transfer or exchange of Definitive Notes.  Definitive Dollar Notes shall be transferred
or exchanged only for Definitive Dollar Notes. 
Definitive Euro Notes shall be transferred or exchanged only for Definitive
Euro Notes.  Prior to such registration
of transfer or exchange, the requesting Holder shall present or surrender to
the Registrar the Definitive Notes duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed by
such Holder or by its attorney, duly authorized in writing.  In addition, the requesting Holder shall
provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this
Section 2.2(e).


 


(i)                                     Transfer Restricted Notes to Transfer
Restricted Notes.  A Transfer Restricted Note may be
transferred to and registered in the name of a Person who takes delivery
thereof in the form of a Transfer Restricted Note if the Registrar receives the
following:


 


(A)                              if the transfer will be made pursuant to Rule 144A under the Securities
Act, then the transferor must deliver a certificate in the form attached to the
applicable Note;


 


(B)                                if the transfer will be made pursuant to Rule 903 or Rule 904 under the
Securities Act, then the transferor must deliver a certificate in the form
attached to the applicable Note;


 


(C)                                if the transfer will be made pursuant to an exemption from the
registration requirements of the Securities Act in accordance with Rule 144
under the Securities Act, a certificate in the form attached to the applicable
Note;


 


(D)                               if the transfer will be made to an IAI in reliance on an exemption from
the registration requirements of the Securities Act other than those listed in
subparagraphs (A) through (D) above, a certificate in the form attached to the
applicable Note; and


 


(E)                                 if such transfer will be made to the Company
or a Subsidiary thereof, a certificate in the form attached to the applicable
Note.


 


(ii)                                  Transfer Restricted Notes to Unrestricted
Definitive Notes.  Any Transfer Restricted Note may be
exchanged by the Holder thereof for an Unrestricted Definitive Note or
transferred to a Person who takes delivery thereof in the form of an
Unrestricted Definitive Note if the Registrar receives the following:


 


(1)                                  if the Holder of such Transfer Restricted
Note proposes to exchange such Transfer Restricted Note for an Unrestricted
Definitive Note, a certificate from such Holder in the form attached to the
applicable Note; or


 


(2)                                  if the Holder of such Transfer Restricted
Note proposes to transfer such Notes to a Person who shall take delivery
thereof in the form of an


 


10

















 


Unrestricted
Definitive Note, a certificate from such Holder in the form attached to the
applicable Note,


 


and,
in each such case, if the Registrar so requests, an Opinion of Counsel in form
reasonably acceptable to the Company to the effect that such exchange or
transfer is in compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Restricted Notes Legend are no longer
required in order to maintain compliance with the Securities Act.


 


(iii)                               Unrestricted Definitive Notes to Unrestricted
Definitive Notes.  A Holder of an Unrestricted Definitive Note
may transfer such Unrestricted Definitive Notes to a Person who takes delivery
thereof in the form of an Unrestricted Definitive Note at any time.  Upon receipt of a request to register such a
transfer, the Registrar shall register the Unrestricted Definitive Notes
pursuant to the instructions from the Holder thereof.


 


(iv)                              Unrestricted Definitive Notes to Transfer
Restricted Notes.  An Unrestricted Definitive Note cannot be
exchanged for, or transferred to a Person who takes delivery thereof in the
form of, a Transfer Restricted Note.


 


At
such time as all beneficial interests in a particular Global Note have been
exchanged for Definitive Notes or a particular Global Note has been redeemed,
repurchased or canceled in whole and not in part, each such Global Note shall
be returned to or retained and canceled by the Trustee in accordance with
Section 2.11.  At any time prior to
such cancellation, if any beneficial interest in a Global Note is exchanged for
or transferred to a Person who will take delivery thereof in the form of a
beneficial interest in another Global Note or for Definitive Notes, the
principal amount of Notes represented by such Global Note shall be reduced
accordingly and an endorsement shall be made on such Global Note by the Trustee
or by the Depository or the Common Depository, as applicable, at the direction
of the Trustee to reflect such reduction; and if the beneficial interest is
being exchanged for or transferred to a Person who will take delivery thereof in
the form of a beneficial interest in another Global Note, such other Global
Note shall be increased accordingly and an endorsement shall be made on such
Global Note by the Trustee or by the Depository or the Common Depository, as
applicable, at the direction of the Trustee to reflect such increase.


 


(f)                                    Legend.


 


(i)                                     Except as permitted by the following
paragraphs (ii), (iii) or (iv), each Note certificate evidencing the Global
Notes and the Definitive Notes (and all Notes issued in exchange therefor or in
substitution thereof) shall bear a legend in substantially the following form
(each defined term in the legend being defined as such for purposes of the
legend only):


 


“THIS
NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION.  NEITHER THIS NOTE
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED


 


11

















 


OF
IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM,
OR NOT SUBJECT TO, SUCH REGISTRATION. 
THE HOLDER OF THIS NOTE, BY ITS ACCEPTANCE HEREOF, (1) REPRESENTS THAT
(A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) OR (B) IT IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT, (2) AGREES ON ITS OWN
BEHALF AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED
SECURITIES, TO OFFER, SELL OR OTHERWISE TRANSFER SUCH NOTE, PRIOR TO THE DATE
(THE “RESALE RESTRICTION TERMINATION DATE”) THAT IS [IN THE CASE OF RULE 144A NOTES:  TWO YEARS] [IN THE CASE OF
REGULATION S NOTES:  40 DAYS]
AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH
THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE (OR ANY
PREDECESSOR OF SUCH NOTE), ONLY (A) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES,
(B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER
THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER THAT PURCHASES FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN
THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO
OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF
REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL “ACCREDITED
INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D
UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING
THE NOTE FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF THE
SECURITIES OF $250,000, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR
OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S AND
THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSE (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM AND (3)
AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN INTEREST
HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS


 


12

















 


LEGEND.  THIS LEGEND WILL BE REMOVED UPON THE REQUEST
OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.”


 


Each
Definitive Note shall 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 Note that is a Definitive Note, the Registrar shall permit the
Holder thereof to exchange such Transfer Restricted Note for a Definitive Note
that does not bear the legends set forth above and rescind any restriction on
the transfer of such Transfer Restricted Note if the Holder certifies in
writing to the Registrar that its request for such exchange was made in
reliance on Rule 144 (such certification to be in the form set forth on the
reverse of the Initial Note).


 


(iii)                               After a transfer of any Initial Notes during
the period of the effectiveness of a Shelf Registration Statement with respect
to such Initial  Notes, all requirements
pertaining to the Restricted Notes Legend on such Initial Notes shall cease to
apply and the requirements that any such Initial Notes be issued in global form
shall continue to apply.


 


(iv)                              Upon the consummation of a Registered
Exchange Offer with respect to the Initial Notes pursuant to which Holders of
such Initial Notes are offered Exchange Notes in exchange for their Initial
Notes, all requirements pertaining to Initial Notes that Initial Notes be
issued in global form shall continue to apply, and Exchange Notes in global
form  without the Restricted Notes
Legend shall be available to Holders that exchange such Initial Notes in such
Registered Exchange Offer.


 


(v)                                 Upon a sale or transfer after the expiration
of the Restricted Period of any Initial Note acquired pursuant to Regulation S,
all requirements that such Initial Note bear the Restricted Notes Legend shall
cease to apply and the requirements requiring any such Initial Note be issued
in global form shall continue to apply.


 


(vi)                              Any Additional Notes sold in a registered
offering shall not be required to bear the Restricted Notes Legend.


 


(g)                                 Cancellation or Adjustment of Global Note.  At
such time as all beneficial interests in a particular Global Note have been
exchanged for Definitive Notes or a particular Global Note has been redeemed,
repurchased or canceled in whole and not in part, each such Global Note shall
be returned to or retained and canceled by the Trustee in accordance with
Section 2.11 of this Indenture.  At
any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for or transferred to a Person who will take delivery thereof
in the form of a beneficial interest in another Global Note or for Definitive
Notes, the principal amount of Notes represented by such Global Note shall be
reduced accordingly and an endorsement shall


 


13

















 


be
made on such Global Note by the Trustee or by the Depository or the Common
Depository, as applicable, at the direction of the Trustee to reflect such
reduction; and if the beneficial interest is being exchanged for or transferred
to a Person who will take delivery thereof in the form of a beneficial interest
in another Global Note, such other Global Note shall be increased accordingly
and an endorsement shall be made on such Global Note by the Trustee or by the
Depository or the Common Depository, as applicable, at the direction of the
Trustee to reflect such increase.


 


(h)                                 Obligations with Respect to Transfers and
Exchanges of Notes.


 


(i)                                     To permit registrations of transfers and
exchanges, the Company shall execute and the Trustee shall authenticate,
Definitive Notes and Global Notes at the Registrar’s request.


 


(ii)                                  No service charge shall be made for any
registration of transfer or exchange, but the Company may require payment of a
sum sufficient to cover any transfer tax, assessments, or similar governmental
charge payable in connection therewith (other than any such transfer taxes,
assessments or similar governmental charge payable upon exchanges pursuant to
Sections 3.03, 4.10, 4.15 and 9.05 of this Indenture).


 


(iii)                               Prior to the due presentation for
registration of transfer of any Note, the Company, the Trustee, a Paying Agent
or the Registrar may deem and treat the person in whose name a Note is
registered as the absolute owner of such Note for the purpose of receiving
payment of principal of and interest on such Note and for all other purposes
whatsoever, whether or not such Note is overdue, and none of the Company, the
Trustee, a Paying Agent or the Registrar 
shall be affected by notice to the contrary.


 


(iv)                              All Notes issued upon any transfer or
exchange pursuant to the terms of this Indenture shall evidence the same debt
and shall be entitled to the same benefits under this Indenture as the Notes
surrendered upon such transfer or exchange.


 


(i)                                     No Obligation of the Trustee.


 


(i)                                     The Trustee shall have no responsibility or
obligation to any beneficial owner of a Global Note, a member of, or a
participant in the Depository or any 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 Notes 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 repurchase) or the payment of any amount, under or with respect to such
Notes.  All notices and communications
to be given to the Holders and all payments to be made to the Holders under the
Notes shall be given or made only to the registered Holders (which shall be the
Depository or its nominee in the case of a Global Note).  In addition, for so long as the Notes are
listed on the Luxembourg Stock Exchange and the rules of such securities
exchange so require, notices to the Holders of the Notes shall be published in
a newspaper having a general circulation in Luxembourg (which is expected to be
the Luxemburger Wort).  The rights of beneficial owners in any
Global Note shall be exercised only through the Depository subject to the
applicable rules and procedures of the Depository.  The


 


14

















 


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 Note (including any transfers between or
among Depository participants, members or beneficial owners in any Global Note)
other than to require delivery of such certificates and other documentation or
evidence as are expressly required by, and to do so if and when expressly
required by, the terms of this Indenture, and to examine the same to determine
substantial compliance as to form with the express requirements hereof.


 


15

















 


EXHIBIT A


 


[FORM OF FACE OF INITIAL DOLLAR NOTE]


 


[Global Notes Legend]


 


UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE
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 NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE
AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS
MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO
ON THE REVERSE HEREOF.


 


[Restricted Notes Legend]


 


THIS
NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION.  NEITHER THIS NOTE
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
SUCH REGISTRATION.  THE HOLDER OF THIS
NOTE, BY ITS ACCEPTANCE HEREOF, (1) REPRESENTS THAT (A) IT IS A “QUALIFIED
INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B)
IT IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
REGULATION S UNDER THE SECURITIES ACT, (2) AGREES ON ITS OWN BEHALF AND ON
BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER,


 

















 


SELL
OR OTHERWISE TRANSFER SUCH NOTE, PRIOR TO THE DATE (THE “RESALE RESTRICTION
TERMINATION DATE”) THAT IS [IN THE CASE OF
RULE 144A NOTES:  TWO YEARS]
[IN THE CASE OF REGULATION S NOTES:  40 DAYS] AFTER THE LATER OF THE ORIGINAL
ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY OR ANY AFFILIATE OF
THE COMPANY WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF SUCH NOTE), ONLY
(A) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (B) PURSUANT TO A REGISTRATION
STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO
LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE
UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E)
TO AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1),
(2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT THAT IS AN
INSTITUTIONAL ACCREDITED INVESTOR ACQUIRING THE NOTE FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A
MINIMUM PRINCIPAL AMOUNT OF THE SECURITIES OF $250,000, FOR INVESTMENT PURPOSES
AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION
IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
THE COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSE (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM
AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN
INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.


 


A-2

















 


THIS
LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.


 


Each
Definitive Dollar Note shall 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.


 


A-3

















 


[FORM OF INITIAL DOLLAR NOTE]


 


	
  No.

  	
   

  	
  $                  

  



 


83/4% Senior Subordinated Note due 2012


 


	
   

  	
  CUSIP
  No.
  [144A:                    ]/[REG
  S:               ]/[IAI:              ]

  
	
   

  	
  ISIN
  No.
  [144A:                    ]/[REG
  S:              ]/[IAI:              
  ]

  
	
   

  	
  Common
  Code:[144A                ]/[REG
  S:              ]/[IAI:              ]

  



 


PP
ACQUISITION CORPORATION, a Delaware corporation, promises to pay to
[                  ],
or registered assigns, the principal sum [of                    Dollars]
[listed on the Schedule of Increases or Decreases in Global Dollar Note
attached hereto](1) on May 15, 2012.


 


Interest Payment Dates:  May 15 and November 15.


Record Dates: May 1 and November 1.


 


Additional
provisions of this Dollar Note are set forth on the other side of this Note.


 


IN
WITNESS WHEREOF, the parties have caused this instrument to be duly executed.


 


	
   

  	
  PP
  ACQUISITION CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


The
undersigned hereby acknowledges and agrees that, upon the effectiveness of the
merger of PP Acquisition Corporation with and into Polypore, Inc. with Polypore,
Inc. continuing as the surviving corporation, it will succeed by operation of
law to all of the rights and obligations of PP Acquisition Corporation set
forth herein and that all references herein to the “Company” shall thereupon be
deemed to be references to the undersigned.


 


POLYPORE,
INC.,


 


 


	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 












(1)                Use the Schedule of Increases and
Decreases language if Dollar Note is in Global Form.


 


A-4

















 


Dated:


 


	
  TRUSTEE’S CERTIFICATE OF

  AUTHENTICATION

  
	
   

  
	
  THE BANK OF NEW YORK,

  as Trustee, certifies that this is

  one of the Dollar Notes

  referred to in the Indenture.

  



 


	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized
  Signatory

  
	
   

  	
   

  













	
  */

  	
  If
  the Dollar Note is to be issued in global form, add the Global Notes Legend
  and the attachment from Exhibit A captioned “TO BE ATTACHED TO GLOBAL
  SECURITIES - SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE”.

  



 


A-5

















 


[FORM OF REVERSE SIDE OF INITIAL DOLLAR NOTE]


 


83/4% Senior Subordinated Note due 2012


 


1.                                       Interest


 


(a)                                  PP ACQUISITION CORPORATION, a Delaware
corporation (such corporation, and its successors and assigns under the
Indenture, including Polypore, Inc. following the merger of PP Acquisition
Corporation with and into Polypore, Inc., hereinafter referred to, being herein
called the “Company”), promises to pay interest on the principal amount of this
Dollar Note at the rate per annum shown above. 
The Company shall pay interest semiannually on May 15 and November 15
of each year, commencing November 15, 2004.  Interest on the Dollar Notes shall accrue from the most recent
date to which interest has been paid or duly provided for or, if no interest
has been paid or duly provided for, from May 13, 2004 until the principal
hereof is due.  Interest shall be
computed on the basis of a 360-day year of twelve 30-day months.  The Company shall pay interest on overdue
principal at the rate borne by the Dollar Notes, and it shall pay interest on
overdue installments of interest at the same rate to the extent lawful.


 


(b)                                 Registration Rights Agreement.  The
Holder of this Dollar Note is entitled to the benefits of a Registration Rights
Agreement, dated as of May 13, 2004, among the Company, the Guarantors and the
Initial Purchasers.


 


2.                                       Method of Payment


 


The
Company shall pay interest on the Dollar Notes (except defaulted interest) and
Additional Interest, if any, to the Persons who are registered Holders at the
close of business on May 1 and November 1 next preceding the interest
payment date even if Dollar Notes are canceled after the record date and on or
before the interest payment date. 
Holders must surrender Notes to a Paying Agent to collect principal
payments.  The Company shall pay
principal, premium, if any, and interest in money of the United States of
America that at the time of payment is legal tender for payment of public and
private debts.  Payments in respect of
the Dollar Notes represented by a Global Dollar Note (including principal,
premium, if any, interest and Additional Interest, if any) shall be made by
wire transfer of immediately available funds to the accounts specified by The
Depository Trust Company or any successor depositary.  The Company will make all payments in respect of a certificated
Dollar Note (including principal, premium, if any, interest and Additional
Interest, if any), at the office of each Paying Agent, except that, at the
option of the Company, payment of interest and Additional Interest, if any, may
be made by mailing a check to the registered address of each Holder thereof; provided, however, that payments on the Dollar
Notes may also be made, in the case of a Holder of at least $1,000,000
aggregate principal amount of Dollar Notes, 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 a
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).


 


A-6

















 


3.                                       Paying Agent and Registrar


 


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


 


4.                                       Indenture.


 


The
Company issued the Dollar Notes under an Indenture dated as of May 13, 2004
(the “Indenture”), among PP Acquisition Corporation, the predecessor of the
Company, the Guarantors and the Trustee. 
The terms of the Dollar Notes 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 “TIA”).  Terms defined in
the Indenture and not defined herein have the meanings ascribed thereto in the
Indenture.  The Dollar Notes are subject
to all terms and provisions of the Indenture, and the Holders (as defined in
the Indenture) are referred to the Indenture and the TIA for a statement of such
terms and provisions.


 


The
Dollar Notes are senior subordinated unsecured obligations of the Company.  This Dollar Note is one of the Initial
Dollar Notes referred to in the Indenture. 
The Dollar Notes include the Initial Dollar Notes and any Exchange
Dollar Notes issued in exchange for Initial Dollar Notes pursuant to the
Indenture.  The Initial Dollar Notes and
any Exchange Dollar Notes together with the Initial Euro Notes and any Exchange
Euro Notes are treated as a single class of securities under the
Indenture.  The Indenture imposes certain
limitations on the ability of the Company and its Restricted Subsidiaries to,
among other things, make certain Investments and other Restricted Payments, pay
dividends and other distributions, incur Indebtedness, sell or otherwise
dispose of assets including capital stock, enter into or permit certain
transactions with Affiliates, create or incur Liens and engage in other
business activities. The Indenture also imposes limitations on the ability of
the Company and each Guarantor to consolidate or merge with or into any other
Person or convey, transfer or lease all or substantially all of its property.


 


To
guarantee the due and punctual payment of the principal of, if any, or interest
on in respect of the Dollar Notes and all other amounts payable by the Company
under the Indenture and the Dollar Notes when and as the same shall be due and
payable, whether at maturity, by acceleration or otherwise, according to the
terms of the Dollar Notes and the Indenture, each of the Guarantors have,
jointly and severally, unconditionally and irrevocably guaranteed the
Guaranteed Obligations on a senior subordinated basis pursuant to the terms of
the Indenture.


 


5.                                       Optional Redemption; Special Redemption


 


Except
as set forth in the following paragraphs, the Dollar Notes shall not be
redeemable at the Company’s option prior to May 15, 2008. Thereafter, the
Dollar Notes shall be subject to redemption at any time at the option of the
Company, in whole or in part, upon not less than 30 nor more than 60 days’
notice, at the redemption prices (expressed as percentages of principal amount
thereof) set forth below plus accrued and unpaid interest to the applicable


 


A-7

















 


redemption
date, if redeemed during the twelve month period commencing on May 15 of the
year set forth below:


 


	
  Year

  	
   

  	
  Redemption
  Price

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2008

  	
   

  	
  104.375

  	
  %

  
	
  2009

  	
   

  	
  102.188

  	
  %

  
	
  2010 and thereafter

  	
   

  	
  100.000

  	
  %

  



 


In
addition, prior to May 15, 2008, the Company may redeem the Dollar Notes at its
option, in whole at any time or in part from time to time, upon not less than
30 nor more than 60 days’ prior notice mailed by first-class mail to each
Holder’s registered address, at a redemption price equal to 100% of the
principal amount of the Dollar Notes redeemed plus the Applicable Premium as
of, and accrued and unpaid interest to, the applicable redemption date (subject
to the right of the Holders of record on the relevant record date to receive
interest due on the relevant interest payment date).


 


Notwithstanding
the foregoing, prior to May 15, 2007, the Company may at its option on one or
more occasions redeem the Dollar Notes (which includes Additional Dollar Notes,
if any) in an aggregate principal amount not to exceed 35% of the aggregate
principal amount of the Dollar Notes (which includes Additional Dollar Notes,
if any) originally issued at a redemption price (expressed as a percentage of
principal amount) of 108.75% plus accrued and unpaid interest to the redemption
date, with the net cash proceeds from one or more Equity Offerings; provided, however, that (i) at
least 65% of such aggregate principal amount of Dollar Notes (which includes
Additional Dollar Notes, if any) remains outstanding immediately after the
occurrence of each such redemption (other than Notes held, directly or
indirectly, by the Company or its Affiliates); and (ii) each such redemption
occurs within 60 days after the date of the related Equity Offering.


 


Notwithstanding
the foregoing, in the event that the Transactions have not been consummated on or
prior to May 20, 2004, then the Company shall mandatorily redeem all the Notes
on or prior to May 21, 2004, at a redemption price in cash equal to 100% of the
issue price of the Notes plus accrued and unpaid interest to the date of
redemption.  Notice of such redemption
shall be given to the Trustee no later than the close of business on May 20,
2004.


 


6.                                       Sinking Fund


 


The
Dollar Notes are not subject to any sinking fund.


 


7.                                       Notice of Redemption


 


Notice
of redemption will be mailed by first-class mail at least 30 days but not more
than 60 days before the redemption date to each Holder of Dollar Notes to be
redeemed at his, her or its registered address.  Dollar Notes in denominations larger than $1,000 may be redeemed
in part but only in whole multiples of $1,000. 
If money sufficient to pay the redemption price of and accrued and
unpaid interest on all Dollar Notes (or portions thereof) to


 


A-8

















 


be
redeemed on the redemption date is deposited with a 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 Dollar Notes (or such portions
thereof) called for redemption.


 


8.                                       Repurchase of Dollar Notes at the Option of
the Holders upon Change of Control and Asset Sales


 


If
a Change of Control occurs, each Holder shall have the right, subject to
certain conditions specified in the Indenture, to require the Company to
repurchase all or a portion of such Holder’s Dollar Notes at a purchase price
equal to 101% of the principal amount thereof plus accrued interest to the date
of repurchase (subject to the right of the Holders of record on the relevant
record date to receive interest due on the relevant interest payment date), as provided
in, and subject to the terms of, the Indenture.


 


In
accordance with Section 4.10 of the Indenture, the Company will be
required to offer to purchase Dollar Notes upon the occurrence of certain
events.


 


9.                                       Subordination


 


The
Dollar Notes and Guarantees are subordinated to Senior Indebtedness, as defined
in the Indenture.  To the extent
provided in the Indenture, Senior Indebtedness must be paid before the Notes
and Guarantees may be paid.  The Company
and each Guarantor agrees, and each Holder by accepting a Dollar Note agrees,
to the subordination provisions contained in the Indenture and authorizes the
Trustee to give it effect and appoints the Trustee as attorney-in-fact for such
purpose.


 


10.                                 Denominations; Transfer; Exchange


 


The
Dollar Notes are in registered form, without coupons, in denominations of
$1,000 and integral multiples of $1,000. 
A Holder shall register the transfer of or exchange of Dollar Notes in
accordance with the Indenture.  Upon any
registration of transfer or exchange, the Registrar and the Trustee may require
a Holder, among other things, to furnish appropriate endorsements or transfer
documents and to pay any taxes required by law or permitted by the
Indenture.  The Registrar need not
register the transfer of or exchange any Dollar Notes selected for redemption
in whole or in part, except the unredeemed portion of any Dollar Note being
redeemed in part.  The Company shall not
be required (i) to issue, to register the transfer of or to exchange any Dollar
Notes during a period beginning at the opening of business 15 days before the
day of the mailing of notice of redemption and ending at the close of business
on such day, (ii) to register the transfer of or to exchange any Dollar Note so
selected for redemption in whole or in part, except the unredeemed portion of
any Dollar Note being redeemed in part or (iii) to register the transfer of or
to exchange a Dollar Note between a record date and the next succeeding
Interest Payment Date.


 


11.                                 Persons Deemed Owners


 


The
registered Holder of this Dollar Note shall be treated as the owner of it for
all purposes.


 


A-9

















 


12.                                 Unclaimed Money


 


If
money for the payment of principal or interest remains unclaimed for two years,
the Trustee and a Paying Agent shall pay the money back to the Company at its
written request unless an abandoned property law designates another
Person.  After any such payment, the
Holders entitled to the money must look to the Company for payment as general
creditors and the Trustee and a Paying Agent shall have no further liability
with respect to such monies.


 


13.                                 Discharge and Defeasance


 


Subject
to certain conditions, the Company at any time may terminate some of or all its
obligations under the Dollar Notes and the Indenture if the Company deposits
with the Trustee cash in United States dollars, non-callable Government
Obligations, or a combination of United States dollars and Government
Obligations, in such amounts as will be sufficient, in the opinion of a nationally
recognized firm of public accountant, to pay the principal amount at maturity
of, premium, if any, and interest on the Dollar Notes on the stated date for
payment thereof or on the applicable redemption date, as the case may be.


 


14.                                 Amendment, Waiver


 


Subject
to certain exceptions set forth in the Indenture, (i) the Indenture, the
Guarantees or the Notes may be amended with the written consent of the Holders
of at least a majority in principal amount of the Notes then outstanding voting
as a single class and (ii) any past default or compliance with any provisions
of the Indenture, the Guarantees or the Notes may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding Notes
voting as a single class; provided,
however, that if any
amendment, waiver or other modification will only affect the Dollar Notes or
the Euro Notes, only the consent of the Holders of at least a majority in
principal amount of the then outstanding Dollar Notes or Euro Notes, as the
case may be, (and not the consent of the majority of all Notes) shall be
required.  Subject to certain exceptions
set forth in the Indenture, without the consent of any Holder, the Company, the
Guarantors and the Trustee may amend the Indenture, the Guarantees or the Notes
(i) to cure any ambiguity, omission, defect or inconsistency; (ii) to provide
for uncertificated Notes in addition to or in place of certificated Notes (provided that the uncertificated Notes
are issued in registered form for purposes of Section 163(f) of the Code,
or in a manner such that the uncertificated Notes are described in
Section 163(f)(2)(B) of the Code) or to alter the provisions of
Article 2 of the Indenture or the Appendix hereof relating to the form of
the Notes (including the related definitions) in a manner that does not
adversely affect any Holder; (iii) to provide for the assumption of the
Company’s or a Guarantor’s obligations to Holders of the Notes by a successor
to the Company or a Guarantor in case of a merger or consolidation; (iv) to
make any change that would provide any additional rights or benefits to the
Holders of the Notes or that does not adversely affect the legal rights under
the Indenture of any such Holder; (v) to comply with the requirements of the
SEC in order to effect or maintain the qualification of the Indenture under the
Trust Indenture Act; (vi) to provide for the issuance of Notes issued after the
Issue Date in accordance with the limitations set forth in the Indenture; (vii)
to release any Guarantor from its Guarantee in accordance with the Indenture;
(viii) or to allow any Guarantor to execute a supplemental indenture to the
Indenture and/or a Guarantee with respect to the Notes; or (ix) make any change
in Article 10 and Article 12 of the Indenture that would limit or
terminate the


 


A-10

















 


benefits
available to any holder of Senior Debt of the Company or a holder of Guarantor
Senior Debt (or any Representative thereof) under such Article 10 and
Article 12.


 


15.                                 Defaults and Remedies


 


Events
of Default include: (i) the failure to pay interest or Additional Interest, if
any, on any Notes when the same becomes due and payable if the default
continues for a period of 30 days (whether or not such payment shall be prohibited
by Article 10 or Article 12 of the Indenture); (ii) the failure to
pay the principal of or premium, if any, on any Notes when such principal or
premium, if any, becomes due and payable, at maturity, upon redemption or
otherwise (including the failure to make a payment to purchase Notes tendered
pursuant to a Change of Control Offer or a Net Proceeds Offer on the date
specified for such payment in the applicable offer to purchase) (whether or not
such payment shall be prohibited by Article 10 or Article 12 of the
Indenture); (iii) a default in the observance or performance of any other
covenant or agreement contained in the Indenture if the default continues for a
period of 30 days after the Company receives written notice specifying the
default (and demanding that such default be remedied) from the Trustee or the
Holders of at least 25% of the outstanding principal amount of the Notes
(except in the case of a default with respect to Section 5.01 or
Section 11.06 of the Indenture, which will constitute an Event of Default
with such notice requirement but without such passage of time requirement);
(iv) the failure to pay at final stated maturity (giving effect to any
applicable grace periods and any extensions thereof) the principal amount of
any Indebtedness of the Company or any Significant Subsidiary of the Company
(other than a Securitization Entity) or the acceleration of the maturity of any
such Indebtedness, if the aggregate principal amount of such Indebtedness,
together with the principal amount of any other such Indebtedness, whether such
Indebtedness now exists, or is created after the date of the Indenture, in
default for failure to pay principal at final maturity or which has been
accelerated, aggregates $20.0 million or more at any time; (v) one or more
judgments in an aggregate amount in excess of $20.0 million (which are not
covered by insurance or indemnity as to which the insurer or a creditworthy
indemnitor has not disclaimed coverage) shall have been rendered against the
Company or any of its Significant Subsidiaries or group of Restricted
Subsidiaries that, taken together (as of the latest audited consolidated
financial statements for the Company and its Restricted Subsidiaries), would
constitute a Significant Subsidiary, and such judgments remain undischarged,
unpaid or unstayed for a period of 60 days after such judgment or judgments
become final and non-appealable; (vi) certain events of bankruptcy, insolvency
or reorganization affecting the Company or any of its Significant Subsidiaries
or group of Restricted Subsidiaries that taken together (as of the latest
audited consolidated financial statements for the Company and its Restricted
Subsidiaries), would constitute a Significant Subsidiary; and (vii) any
Guarantee of a Significant Subsidiary, or group of Restricted Subsidiaries
that, taken together (as of the latest audited consolidated financial
statements for the Company and its Restricted Subsidiaries) would constitute a
Significant Subsidiary, ceases to be in full force and effect (except as
contemplated by the terms of the Indenture) or is declared null and void in a
judicial proceeding or any Guarantor that is a Significant Subsidiary or group
of Guarantors that taken together (as of the latest audited consolidated
financial statements of the Company and its Restricted Subsidiaries) would
constitute a Significant Subsidiary denies or disaffirms its obligations under
the Indenture or its Guarantee. If any Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the then outstanding Notes may declare all the Notes to be due and payable.
Notwithstanding the


 


A-11

















 


foregoing,
in the case of an Event of Default arising from certain events of bankruptcy
with respect to the Company, all outstanding Notes will become due and payable
without further action or notice. Holders may not enforce the Indenture or the
Notes except as provided in the Indenture. Subject to certain limitations,
Holders of a majority in principal amount of the then outstanding Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing Default or Event of
Default (except a Default or Event of Default relating to the payment of
principal or interest or Additional Interest) if it determines that withholding
notice is in their interest. The Holders of a majority in aggregate principal
amount of the Notes then outstanding by notice to the Trustee may on behalf of
the Holders of all of the Notes waive any existing Default or Event of Default
and its consequences under the Indenture except a continuing Default or Event
of Default in the payment of interest (including Additional Interest, if any) on,
or the principal of, the Notes. The Company is required to deliver to the
Trustee annually a statement regarding compliance with the Indenture, and the
Company is required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.


 


16.                                 Trustee Dealings with the Company


 


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


 


17.                                 Authentication


 


This
Dollar Note 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 Dollar Note.


 


18.                                 Abbreviations


 


Customary
abbreviations may be used in the name of a Holder 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).


 


19.                                 Governing Law


 


THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.


 


20.                                 CUSIP Numbers, ISINs and Common Codes


 


The
Company has caused CUSIP numbers and ISINs and, in the case of the Euro Notes,
Common Codes, to be printed on the Notes and has directed the Trustee to use
CUSIP numbers and ISINs and, in the case of the Euro Notes, Common Codes, in
notices of redemption as a convenience to the Holders.  No representation is made as to the accuracy
of such numbers


 


A-12

















 


either
as printed on the Notes or as contained in any notice of redemption and
reliance may be placed only on the other identification numbers placed thereon.


 


The Company will furnish to any Holder of Notes upon
written request and without charge to the Holder a copy of the Indenture which
has in it the text of this Note.


 


A-13

















 


ASSIGNMENT FORM


 


To
assign this Note, fill in the form below:


 


I
or we assign and transfer this Note 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 Note 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 Note.


 


 


	
  Signature
  Guarantee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
	
  Signature
  must be guaranteed by a participant in a recognized signature guaranty
  medallion program or other signature guarantor program reasonably acceptable
  to the Trustee

  	
   

  	
  Signature
  of Signature Guarantee

  
				



 


A-14

















 


CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR

REGISTRATION OF TRANSFER RESTRICTED DOLLAR NOTES


 


This
certificate relates to $           
principal amount of Dollar Notes held in (check applicable space)          
book-entry or             
definitive form by the undersigned.


 


The
undersigned (check one box below):


 


o                                    has requested the Trustee by written order to
deliver in exchange for its beneficial interest in the Global Dollar Note held
by the Depository a Dollar Note or Dollar Notes in definitive, registered form
of authorized denominations and an aggregate principal amount equal to its
beneficial interest in such Global Dollar Note (or the portion thereof
indicated above);


 


o                                    has requested the Trustee by written order to
exchange or register the transfer of a Dollar Note or Dollar Notes.


 


In
connection with any transfer of any of the Dollar Notes evidenced by this
certificate occurring prior to the expiration of the period referred to in Rule
144(k) under the Notes Act, the undersigned confirms that such Dollar Notes are
being transferred in accordance with its terms:


 


CHECK
ONE BOX BELOW


 


	
  (1)

  	
  o

  	
  to
  the Company; or

  
	
   

  	
   

  	
   

  
	
  (2)

  	
  o

  	
  to
  the Registrar for registration in the name of the Holder, without transfer;
  or

  
	
   

  	
   

  	
   

  
	
  (3)

  	
  o

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

  
	
   

  	
   

  	
   

  
	
  (4)

  	
  o

  	
  inside
  the United States to a “qualified institutional buyer” (as defined in Rule
  144A under the Securities Act of 1933) that purchases for its own account or
  for the account of a qualified institutional buyer to whom notice is given
  that such transfer is being made in reliance on Rule 144A, in each case
  pursuant to and in compliance with Rule 144A under the Securities Act of
  1933; or

  
	
   

  	
   

  	
   

  
	
  (5)

  	
  o

  	
  outside
  the United States 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 and such Note shall be held immediately after the transfer
  through Euroclear or Clearstream until the expiration of the Restricted
  Period (as defined in the Indenture); or

  
	
   

  	
   

  	
   

  
	
  (6)

  	
  o

  	
  to
  an institutional “accredited investor” (as defined in Rule 501(a)(1), (2),
  (3) or (7) under the Securities Act of 1933) that has furnished to the
  Trustee a signed letter containing certain representations and agreements; or

  



 


A-15

















 


	
  (7)

  	
  o

  	
  pursuant
  to another available exemption from registration provided by Rule 144 under
  the Securities Act of 1933.

  



 


Unless
one of the boxes is checked, the Trustee will refuse to register any of the
Notes evidenced by this certificate in the name of any Person other than the
registered Holder thereof; provided,
however, that if box (5),
(6) or (7) is checked, the Trustee may require, prior to registering any such
transfer of the Notes, such legal opinions, certifications and other
information as the 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.


 


 


	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Your
  Signature

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature
  Guarantee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
	
  Signature
  must be guaranteed by a participant in a recognized signature guaranty
  medallion program or other signature guarantor program reasonably acceptable
  to the Trustee

  	
   

  	
  Signature
  of Signature Guarantee

  



 


A-16

















 


TO BE COMPLETED BY PURCHASER IF (4) ABOVE IS CHECKED.


 


The
undersigned represents and warrants that it is purchasing this Dollar Note for
its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a “qualified
institutional buyer” within the meaning of Rule 144A under the Securities Act
of 1933, and is aware that the sale to it is being made in reliance on Rule
144A and acknowledges that it has received such information regarding the
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

  



 


A-17

















 


[TO BE ATTACHED TO GLOBAL DOLLAR NOTES]


 


SCHEDULE OF INCREASES OR DECREASES IN GLOBAL DOLLAR NOTE


 


The
initial principal amount of this Global Dollar Note is $                           .  The following increases or decreases in this
Global Dollar Note have been made:


 


	
  Date of

  Exchange

  	
   

  	
  Amount of
  decrease

  in Principal Amount

  of this Global Dollar

  Note

  	
   

  	
  Amount of
  increase in

  Principal Amount of

  this Global Dollar

  Note

  	
   

  	
  Principal
  amount of this

  Global Dollar Note

  following such decrease or

  increase

  	
   

  	
  Signature
  of authorized

  signatory of Trustee or Notes

  Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


A-18

















 


OPTION OF HOLDER TO ELECT PURCHASE


 


If you want to elect to have this Dollar Note
purchased by the Company pursuant to Section 4.10 (Asset Sale) or 4.15
(Change of Control) of the Indenture, check the box:


 




	
  Asset Sale  o

  	
   

  	
  Change of Control  o

  






 


If you want to elect to have only part of this Dollar
Note purchased by the Company pursuant to Section 4.10 (Asset Sale) or
4.15 (Change of Control) of the Indenture, state the amount ($1,000 or an
integral multiple thereof):


 


 


$


 


	
  Date:

  	
   

  	
   

  	
  Your Signature:

  	
   

  	
   

  
	
   

  	
  (Sign exactly as your name

  appears on the other side of

  this Note)

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signature Guarantee:

  	
   

  	
   

  
								



 


 


Signature must be guaranteed by a participant in a
recognized signature guaranty medallion program or other signature guarantor
program reasonably acceptable to the Trustee


 


A-19



















EXHIBIT B


 


[FORM OF FACE OF INITIAL EURO NOTE]


 


[Global Notes Legend]


 


UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE BANK OF
NEW YORK DEPOSITORY (NOMINEES) LIMITED, TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN A NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
BANK OF NEW YORK DEPOSITORY (NOMINEES) LIMITED (AND ANY PAYMENT IS MADE TO SUCH
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE BANK OF NEW YORK
DEPOSITORY (NOMINEES) LIMITED), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF HAS AN INTEREST HEREIN.


 


TRANSFERS
OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
THE COMMON DEPOSITORY, TO NOMINEES OF THE COMMON DEPOSITORY OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.


 


[Restricted Notes Legend]


 


THIS
NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR
OTHER JURISDICTION.  NEITHER THIS NOTE
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
SUCH REGISTRATION.  THE HOLDER OF THIS
NOTE, BY ITS ACCEPTANCE HEREOF, (1) REPRESENTS THAT (A) IT IS A “QUALIFIED
INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B)
IT IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
REGULATION S UNDER THE SECURITIES ACT, (2) AGREES ON ITS OWN BEHALF AND ON
BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER,
SELL OR OTHERWISE TRANSFER SUCH NOTE, PRIOR TO THE DATE (THE “RESALE
RESTRICTION TERMINATION DATE”) THAT IS [IN
THE CASE OF RULE 144A NOTES: 
TWO YEARS] [IN THE CASE OF REGULATION
S NOTES:  40 DAYS] AFTER THE
LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH THE COMPANY
OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE


 

















 


(OR
ANY PREDECESSOR OF SUCH NOTE), ONLY (A) TO THE COMPANY OR ANY OF ITS
SUBSIDIARIES, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON
IT REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER THAT PURCHASES FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D)
PURSUANT TO OFFERS AND SALES THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL
“ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) OF
REGULATION D UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL ACCREDITED
INVESTOR ACQUIRING THE NOTE FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF SUCH AN
INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL AMOUNT
OF THE SECURITIES OF THE EURO EQUIVALENT OF $250,000, FOR INVESTMENT PURPOSES
AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN CONNECTION WITH ANY DISTRIBUTION
IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE
COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSE (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM
AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN
INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND.  THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.


 


Each
Definitive Euro Note shall 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.


 


B-2

















 


[FORM OF INITIAL EURO NOTE]


 


 


	
  No.

  	
   

  	
  €                  

  



 


83/4% Senior Subordinated Note due 2012


 


	
   

  	
  CUSIP
  No.
  [144A:                    ]/[REG
  S:               ]

  
	
   

  	
  ISIN No.
  [144A:                   ]/[REG
  S:               ]

  
	
   

  	
  Common
  Code
  [144A:               ]/[REG
  S:              ]

  



 


PP
ACQUISITION CORPORATION, a Delaware corporation, promises to pay to
[                  ],
or registered assigns, the principal sum [of              Euros]
[listed on the Schedule of Increases or Decreases in Global Euro Note
attached hereto](1) on May 15, 2012.


 


Interest
Payment Dates:  May 15 and
November 15.


 


Record Dates: 
May 1 and November 1.


 


Additional
provisions of this Euro Note are set forth on the other side of this Note.


 


IN
WITNESS WHEREOF, the parties have caused this instrument to be duly executed.


 


	
   

  	
  PP
  ACQUISITION CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


The
undersigned hereby acknowledges and agrees that, upon the effectiveness of the
merger of PP Acquisition Corporation with and into Polypore, Inc. with
Polypore, Inc. continuing as the surviving corporation, it will succeed by
operation of law to all of the rights and obligations of PP Acquisition
Corporation set forth herein and that all references herein to the “Company”
shall thereupon be deemed to be references to the undersigned.


 


	
  POLYPORE, INC.,

  
	
   

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 


	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 












(1)                Use the Schedule of Increases and
Decreases language if Euro Note is in Global Form.


 


B-3

















 


	
  Dated:

  
	
   

  
	
  TRUSTEE’S CERTIFICATE OF

  AUTHENTICATION

  
	
   

  
	
  THE BANK OF NEW YORK,

  as Trustee, certifies that this is

  one of the Euro Notes referred to

  in the Indenture.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized
  Signatory

  



 












*/                     If the Euro Note is to be issued in global
form, add the Global Notes Legend and the attachment from Exhibit A captioned
“TO BE ATTACHED TO GLOBAL NOTES - SCHEDULE OF INCREASES OR DECREASES IN
GLOBAL NOTE”.


 


B-4

















 


[FORM OF REVERSE SIDE OF INITIAL EURO NOTE]


 


83/4% Senior Subordinated Note due 2012


 


1.                                       Interest


 


(a)                                  PP ACQUISITION CORPORATION, a Delaware
corporation (such corporation, and its successors and assigns under the
Indenture, including Polypore, Inc. following the merger of PP Acquisition
Corporation with an into Polypore, Inc., hereinafter referred to, being herein
called the “Company”), promises to pay interest on the principal amount of this
Euro Note at the rate per annum shown above. 
The Company shall pay interest semiannually on May 15 and November 15
of each year, commencing November 15, 2004.  Interest on the Euro Notes shall accrue from the most recent date
to which interest has been paid or duly provided for or, if no interest has
been paid or duly provided for, from May 13, 2004 until the principal hereof is
due.  Interest shall be computed on the
basis of a 360-day year of twelve 30-day months.  The Company shall pay interest on overdue principal at the rate
borne by the Euro Notes, and it shall pay interest on overdue installments of
interest at the same rate to the extent lawful.


 


(b)                                 Registration Rights Agreement.  The
Holder of this Euro Note is entitled to the benefits of a Registration Rights
Agreement, dated as of May 13, 2004, among the Company, the Guarantors and the
Initial Purchasers named therein.


 


2.                                       Method of Payment


 


The
Company shall pay interest on the Euro Notes (except defaulted interest and
Additional Interest, if any) to the Persons who are registered Holders at the
close of business on May 1 and November 1 next preceding the interest
payment date even if Euro Notes are canceled after the record date and on or
before the interest payment date. 
Holders must surrender Euro Notes to a Paying Agent to collect principal
payments.  The Company shall pay
principal, premium, if any, and interest in money of a member state of the
European Union that at the time of payment is legal tender for payment of
public and private debts.  Payments in
respect of the Euro Notes represented by a Global Note (including principal,
premium, if any, interest and Additional Interest, if any) shall be made by
wire transfer of immediately available funds to the accounts specified by The
Depository Trust Company or any successor depositary.  The Company will make all payments in respect of a certificated
Euro Note (including principal, premium, if any, interest and Additional
Interest, if any), at the office of a Paying Agent, except that, at the option
of the Company, payment of interest and Additional Interest, if any, may be
made by mailing a check to the registered address of each Holder thereof; provided, however, that payments on the Euro
Notes may also be made, in the case of a Holder of at least €1,000,000
aggregate principal amount of Euro Notes, by wire transfer to a Euro account
maintained by the payee with a bank in member state of the European Union if
such Holder elects payment by wire transfer by giving written notice to the
Trustee or a 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).


 


B-5

















 


3.                                       Paying Agent and Registrar


 


Initially,
The Bank of New York, will act as Euro Paying Agent.  The Company may appoint and change any Paying Agent or Registrar
without notice.  The Company or any of
its domestically incorporated Wholly-Owned Subsidiaries may act as Paying Agent
or Registrar.


 


4.                                       Indenture


 


The
Company issued the Euro Notes under an Indenture dated as of May 13, 2004 (the
“Indenture”), among PP Acquisition Corporation, the predecessor of the Company,
the Guarantors and The Bank of New York, a New York banking corporation (the
“Trustee”).  The terms of the Euro Notes
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
“TIA”).  Terms defined in the Indenture
and not defined herein have the meanings ascribed thereto in the
Indenture.  The Euro Notes are subject
to all terms and provisions of the Indenture, and the Holders (as defined in
the Indenture) are referred to the Indenture and the TIA for a statement of
such terms and provisions.


 


The
Euro Notes are senior subordinated unsecured obligations of the Company.  This Euro Note is one of the Initial Euro
Notes referred to in the Indenture.  The
Euro Notes include the Initial Euro Notes and any Exchange Euro Notes issued in
exchange for Initial Euro Notes pursuant to the Indenture.  The Initial Euro Notes and any Exchange Euro
Notes together with the Initial Dollar Notes and the Exchange Dollar Notes are
treated as a single class of securities under the Indenture.  The Indenture imposes certain limitations on
the ability of the Company and its Restricted Subsidiaries to, among other
things, make certain Investments and other Restricted Payments, pay dividends
and other distributions, incur Indebtedness, sell or otherwise dispose of
assets including capital stock, enter into or permit certain transactions with
Affiliates, create or incur Liens and engage in other business activities.  The Indenture also imposes limitations on
the ability of the Company and each Guarantor to consolidate or merge with or
into any other Person or convey, transfer or lease all or substantially all of
its property.


 


To
guarantee the due and punctual payment of the principal of, premium, if any, or
interest on in respect of the Euro Notes and all other amounts payable by the
Company under the Indenture and the Euro Notes when and as the same shall be
due and payable, whether at maturity, by acceleration or otherwise, according
to the terms of the Euro Notes and the Indenture, each of the Guarantors have,
jointly and severally, unconditionally and irrevocably guaranteed the
Guaranteed Obligations on a senior subordinated basis pursuant to the terms of
the Indenture.


 


5.                                       Optional Redemption; Special Redemption


 


Except
as set forth in the following paragraphs, the Euro Notes shall not be
redeemable at the Company’s option prior to May 15, 2008. Thereafter, the Euro
Notes shall be subject to redemption at any time at the option of the Company,
in whole or in part, upon not less than 30 nor more than 60 days’ notice, at
the redemption prices (expressed as percentages of principal amount thereof)
set forth below plus accrued and unpaid interest to the applicable


 


B-6

















 


redemption
date, if redeemed during the twelve month period commencing on May 15 of the
year set forth below:


 


	
  Year

  	
   

  	
  Redemption
  Price

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2008

  	
   

  	
  104.375

  	
  %

  
	
  2009

  	
   

  	
  102.188

  	
  %

  
	
  2010 and thereafter

  	
   

  	
  100.000

  	
  %

  



 


In
addition, prior to May 15, 2008, the Company may redeem the Euro Notes, at its
option, in whole at any time or in part from time to time, upon not less than
30 nor more than 60 days’ prior notice mailed by first-class mail to each
Holder’s registered address, at a redemption price equal to 100% of the
principal amount of the Euro Notes redeemed plus the Applicable Premium as of,
and accrued and unpaid interest to, the applicable redemption date (subject to
the right of the Holders of record on the relevant record date to receive
interest due on the relevant interest payment date).


 


Notwithstanding
the foregoing, prior to May 15, 2007, the Company may at its option on one or
more occasions redeem the Euro Notes (which includes Additional Euro Notes, if
any) in an aggregate principal amount not to exceed 35% of the aggregate
principal amount of the Euro Notes (which includes Additional Dollar Notes, if
any) originally issued at a redemption price (expressed as a percentage of
principal amount) of 108.75% plus accrued and unpaid interest to the redemption
date, with the net cash proceeds from one or more Equity Offerings; provided, however, that (i) at
least 65% of such aggregate principal amount of Dollar Notes (which includes
Additional Dollar Notes, if any) remains outstanding immediately after the
occurrence of each such redemption (other than Notes held, directly or
indirectly, by the Company or its Affiliates); and (ii) each such redemption
occurs within 60 days after the date of the related Equity Offering.


 


Notwithstanding
the foregoing, in the event that the Transactions have not been consummated on
or prior to May 20, 2004, then the Company shall mandatorily redeem all the
Notes on or prior to May 21, 2004, at a redemption price in cash equal to 100% of
the issue price of the Notes plus accrued and unpaid interest to the date of
redemption.  Notice of such redemption
shall be given to the Trustee no later than the close of business on May 20,
2004.


 


6.                                       Sinking Fund


 


The
Euro Notes are not subject to any sinking fund.


 


7.                                       Notice of Redemption


 


Notice
of redemption will be mailed by first-class mail at least 30 days but not more
than 60 days before the redemption date to each Holder of Euro Notes to be
redeemed at his, her or its registered address.  Euro Notes in denominations larger than €1,000 may be redeemed in
part but only in whole multiples of €1,000. 
If money sufficient to pay the redemption price of and accrued and
unpaid interest on all Euro Notes (or portions thereof) to be


 


B-7

















 


redeemed
on the redemption date is deposited with a 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 Euro Notes (or such portions thereof)
called for redemption.


 


8.                                      Repurchase of Euro Notes at the Option of the
Holders upon Change of Control and Asset Sales


 


If
a Change of Control occurs, each Holder shall have the right, subject to
certain conditions specified in the Indenture, to require the Company to
repurchase all or a portion of such Holder’s Euro Notes at a purchase price
equal to 101% of the principal amount thereof plus accrued interest to the date
of repurchase (subject to the right of the Holders of record on the relevant
record date to receive interest due on the relevant interest payment date), as
provided in, and subject to the terms of, the Indenture.


 


In
accordance with Section 4.10 of the Indenture, the Company will be
required to offer to purchase Euro Notes upon the occurrence of certain events.


 


9.                                       Subordination


 


The
Euro Notes and Guarantees are subordinated to Senior Indebtedness, as defined
in the Indenture.  To the extent
provided in the Indenture, Senior Indebtedness must be paid before the Euro
Notes and Guarantees may be paid.  The
Company and each Guarantor agrees, and each Holder by accepting a Euro Note
agrees, to the subordination provisions contained in the Indenture and
authorizes the Trustee to give it effect and appoints the Trustee as attorney-in-fact
for such purpose.


 


10.                                 Denominations; Transfer; Exchange


 


The
Euro Notes are in registered form, without coupons, in denominations of €1,000
and integral multiples of €1,000.  A
Holder shall register the transfer of or exchange of Euro Notes in accordance
with the Indenture.  Upon any
registration of transfer or exchange, the Registrar and the Trustee may require
a Holder, among other things, to furnish appropriate endorsements or transfer
documents and to pay any taxes required by law or permitted by the
Indenture.  The Registrar need not
register the transfer of or exchange any Euro Notes selected for redemption in
whole or in part, except the unredeemed portion of any Euro Note being redeemed
in part.  The Company shall not be
required (i) to issue, to register the transfer of or to exchange any Euro
Notes during a period beginning at the opening of business 15 days before the
day of the mailing of notice of redemption and ending at the close of business
on such day, (ii) to register the transfer of or to exchange any Euro Note so
selected for redemption in whole or in part, except the unredeemed portion of
any Euro Note being redeemed in part or (iii) to register the transfer of or to
exchange a Euro Note between a record date and the next succeeding Interest
Payment Date.


 


11.                                 Persons Deemed Owners


 


The
registered Holder of this Euro Note shall be treated as the owner of it for all
purposes.


 


B-8

















 


12.                                 Unclaimed Money


 


If
money for the payment of principal or interest remains unclaimed for two years,
the Trustee and a Paying Agent shall pay the money back to the Company at its
written request unless an abandoned property law designates another
Person.  After any such payment, the
Holders entitled to the money must look to the Company for payment as general
creditors and the Trustee and a Paying Agent shall have no further liability
with respect to such monies.


 


13.                                 Discharge and Defeasance


 


Subject
to certain conditions, the Company at any time may terminate some of or all its
obligations under the Notes and the Indenture if the Company deposits with the
Trustee cash in euros or EU Government Obligations, or a combination of euros
and EU Government Obligations, in such amounts as will be sufficient, in the
opinion of a nationally recognized firm of public accountants to pay the
principal amount at maturity of, premium, if any, and interest on the Notes on
the stated date for payment thereof or on the applicable redemption date, as
the case may be.


 


14.                                 Amendment, Waiver


 


Subject
to certain exceptions set forth in the Indenture, (i) the Indenture, the
Guarantees or the Notes may be amended with the written consent of the Holders
of at least a majority in principal amount of the Notes then outstanding voting
as a single class and (ii) any past default or compliance with any provisions
of the Indenture, the Guarantees or the Notes may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding Notes
voting as a single class; provided,
however, that if any
amendment, waiver or other modification will only affect the Dollar Notes or
the Euro Notes, only the consent of the Holders of at least a majority in
principal amount of the then outstanding Dollar Notes or Euro Notes, as the
case may be, (and not the consent of the majority of all Notes) shall be
required.  Subject to certain exceptions
set forth in the Indenture, without the consent of any Holder, the Company, the
Guarantors and the Trustee may amend the Indenture, the Guarantees or the Notes
(i) to cure any ambiguity, omission, defect or inconsistency; (ii) to provide
for uncertificated Notes in addition to or in place of certificated Notes (provided that the uncertificated Notes
are issued in registered form for purposes of Section 163(f) of the Code,
or in a manner such that the uncertificated Notes are described in
Section 163(f)(2)(B) of the Code) or to alter the provisions of
Article 2 of the Indenture or the Appendix hereof relating to the form of
the Notes (including the related definitions) in a manner that does not
adversely affect any Holder; (iii) to provide for the assumption of the
Company’s or a Guarantor’s obligations to Holders of the Notes by a successor
to the Company or a Guarantor in case of a merger or consolidation; (iv) to
make any change that would provide any additional rights or benefits to the
Holders of the Notes or that does not adversely affect the legal rights under
the Indenture of any such Holder; (v) to comply with the requirements of the
SEC in order to effect or maintain the qualification of the Indenture under the
Trust Indenture Act; (vi) to provide for the issuance of Notes issued after the
Issue Date in accordance with the limitations set forth in the Indenture; (vii)
to release any Guarantor from its Guarantee in accordance with the Indenture;
(viii) or to allow any Guarantor to execute a supplemental indenture to the
Indenture and/or a Guarantee with respect to the Notes; or (ix) make any change
in Article 10 and Article 12 of the Indenture that would limit or
terminate the


 


B-9

















 


benefits
available to any holder of Senior Debt of the Company or a holder of Guarantor
Senior Debt (or any Representative thereof) under such Article 10 and Article 12.


 


15.                                 Defaults and Remedies


 


Events
of Default include: (i) the failure to pay interest or Additional Interest, if
any, on any Notes when the same becomes due and payable if the default
continues for a period of 30 days (whether or not such payment shall be
prohibited by Article 10 or Article 12 of the Indenture); (ii) the
failure to pay the principal of or premium, if any, on any Notes when such
principal or premium, if any, becomes due and payable, at maturity, upon
redemption or otherwise (including the failure to make a payment to purchase
Notes tendered pursuant to a Change of Control Offer or a Net Proceeds Offer on
the date specified for such payment in the applicable offer to purchase)
(whether or not such payment shall be prohibited by Article 10 or
Article 12 of the Indenture); (iii) a default in the observance or
performance of any other covenant or agreement contained in the Indenture if
the default continues for a period of 30 days after the Company receives
written notice specifying the default (and demanding that such default be
remedied) from the Trustee or the Holders of at least 25% of the outstanding
principal amount of the Notes (except in the case of a default with respect to
Section 5.01 or Section 11.06 of the Indenture, which will constitute
an Event of Default with such notice requirement but without such passage of
time requirement); (iv) the failure to pay at final stated maturity (giving
effect to any applicable grace periods and any extensions thereof) the
principal amount of any Indebtedness of the Company or any Significant
Subsidiary of the Company (other than a Securitization Entity) or the
acceleration of the maturity of any such Indebtedness, if the aggregate
principal amount of such Indebtedness, together with the principal amount of
any other such Indebtedness, whether such Indebtedness now exists, or is
created after the date of the Indenture, in default for failure to pay
principal at final maturity or which has been accelerated, aggregates $20.0
million or more at any time; (v) one or more judgments in an aggregate amount
in excess of $20.0 million (which are not covered by insurance or indemnity as
to which the insurer or a creditworthy indemnitor has not disclaimed coverage)
shall have been rendered against the Company or any of its Significant
Subsidiaries or group of Restricted Subsidiaries that, taken together (as of
the latest audited consolidated financial statements for the Company and its
Restricted Subsidiaries), would constitute a Significant Subsidiary, and such
judgments remain undischarged, unpaid or unstayed for a period of 60 days after
such judgment or judgments become final and non-appealable; (vi) certain events
of bankruptcy, insolvency or reorganization affecting the Company or any of its
Significant Subsidiaries or group of Restricted Subsidiaries that taken
together (as of the latest audited consolidated financial statements for the
Company and its Restricted Subsidiaries), would constitute a Significant
Subsidiary; and (vii) any Guarantee of a Significant Subsidiary, or group of
Restricted Subsidiaries that, taken together (as of the latest audited
consolidated financial statements for the Company and its Restricted
Subsidiaries) would constitute a Significant Subsidiary, ceases to be in full force
and effect (except as contemplated by the terms of the Indenture) or is
declared null and void in a judicial proceeding or any Guarantor that is a
Significant Subsidiary or group of Guarantors that taken together (as of the
latest audited consolidated financial statements of the Company and its
Restricted Subsidiaries) would constitute a Significant Subsidiary denies or
disaffirms its obligations under the Indenture or its Guarantee. If any Event
of Default occurs and is continuing, the Trustee or the Holders of at least 25%
in principal amount of the then outstanding Notes may declare all the Notes to
be due and payable. Notwithstanding the


 


B-10

















 


foregoing,
in the case of an Event of Default arising from certain events of bankruptcy
with respect to the Company, all outstanding Notes will become due and payable
without further action or notice. Holders may not enforce the Indenture or the
Notes except as provided in the Indenture. Subject to certain limitations,
Holders of a majority in principal amount of the then outstanding Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing Default or Event of
Default (except a Default or Event of Default relating to the payment of
principal or interest or Additional Interest) if it determines that withholding
notice is in their interest. The Holders of a majority in aggregate principal
amount of the Notes then outstanding by notice to the Trustee may on behalf of
the Holders of all of the Notes waive any existing Default or Event of Default
and its consequences under the Indenture except a continuing Default or Event
of Default in the payment of interest (including Additional Interest, if any)
on, or the principal of, the Notes. The Company is required to deliver to the
Trustee annually a statement regarding compliance with the Indenture, and the
Company is required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.


 


16.                                 Trustee Dealings with the Company


 


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


 


17.                                 Authentication


 


This
Euro Note 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 Euro Note.


 


18.                                 Abbreviations


 


Customary
abbreviations may be used in the name of a Holder 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).


 


19.                                 Governing Law


 


THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.


 


20.                                 CUSIP Numbers, ISINs and Common Codes


 


The
Company has caused CUSIP numbers and ISINs and, in the case of the Euro Notes,
Common Codes, to be printed on the Notes and has directed the Trustee to use
CUSIP numbers and ISINs and, in the case of the Euro Notes, Common Codes, in
notices of redemption as a convenience to the Holders.  No representation is made as to the accuracy
of such numbers


 


B-11

















 


either
as printed on the Notes or as contained in any notice of redemption and
reliance may be placed only on the other identification numbers placed thereon.


 


The
Company will furnish to any Holder of Notes upon written request and without
charge to the Holder a copy of the Indenture which has in it the text of this
Note.


 


B-12

















 


ASSIGNMENT FORM


 


To
assign this Note, fill in the form below:


 


I
or we assign and transfer this Note 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 Note 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 Note.


 


 


	
  Signature
  Guarantee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
	
  Signature
  must be guaranteed by a participant in a recognized signature guaranty
  medallion program or other signature guarantor program reasonably acceptable
  to the Trustee

  	
   

  	
  Signature
  of Signature Guarantee

  
				



 


B-13

















 


CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR

REGISTRATION OF TRANSFER RESTRICTED EURO NOTES


 


This
certificate relates to €                    
principal amount of Euro Notes held in (check applicable space)             
book-entry or                
definitive form by the undersigned.


 


The
undersigned (check one box below):


 


o                                    has requested the Trustee by written order to
deliver in exchange for its beneficial interest in the Global Euro Note held by
the Depository a Euro Note or Euro Notes in definitive, registered form of
authorized denominations and an aggregate principal amount equal to its beneficial
interest in such Global Euro Note (or the portion thereof indicated above);


 


o                                    has requested the Trustee by written order to
exchange or register the transfer of a Euro Note or Euro Notes.


 


In
connection with any transfer of any of the Euro Notes evidenced by this
certificate occurring prior to the expiration of the period referred to in Rule
144(k) under the Notes Act, the undersigned confirms that such Euro Notes are
being transferred in accordance with its terms:


 


CHECK
ONE BOX BELOW


 


	
  (1)

  	
  o

  	
  to
  the Company; or

  
	
   

  	
   

  	
   

  
	
  (2)

  	
  o

  	
  to
  the Registrar for registration in the name of the Holder, without transfer;
  or

  
	
   

  	
   

  	
   

  
	
  (3)

  	
  o

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

  
	
   

  	
   

  	
   

  
	
  (4)

  	
  o

  	
  inside
  the United States to a “qualified institutional buyer” (as defined in Rule
  144A under the Securities Act of 1933) that purchases for its own account or
  for the account of a qualified institutional buyer to whom notice is given
  that such transfer is being made in reliance on Rule 144A, in each case
  pursuant to and in compliance with Rule 144A under the Securities Act of
  1933; or

  
	
   

  	
   

  	
   

  
	
  (5)

  	
  o

  	
  outside
  the United States 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 and such Note shall be held immediately after the transfer
  through Euroclear or Clearstream until the expiration of the Restricted
  Period (as defined in the Indenture); or

  
	
   

  	
   

  	
   

  
	
  (6)

  	
  o

  	
  to
  an institutional “accredited investor” (as defined in Rule 501(a)(1), (2),
  (3) or (7) under the Securities Act of 1933) that has furnished to the
  Trustee a signed letter containing certain representations and agreements; or

  



 


B-14

















 


	
  (7)

  	
  o

  	
  pursuant
  to another available exemption from registration provided by Rule 144 under
  the Securities Act of 1933.

  



 


Unless
one of the boxes is checked, the Trustee will refuse to register any of the
Notes evidenced by this certificate in the name of any Person other than the registered
Holder thereof; provided, however, that if box (5), (6) or (7)
is checked, the Trustee may require, prior to registering any such transfer of
the Notes, such legal opinions, certifications and other information as the
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.


 


 


	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Your
  Signature

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Signature
  Guarantee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
	
  Signature
  must be guaranteed by a participant in a recognized signature guaranty
  medallion program or other signature guarantor program reasonably acceptable
  to the Trustee

  	
   

  	
  Signature
  of Signature Guarantee

  



 


B-15

















 


TO BE COMPLETED BY PURCHASER IF (4) ABOVE IS CHECKED.


 


The
undersigned represents and warrants that it is purchasing this Euro Note for
its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a “qualified
institutional buyer” within the meaning of Rule 144A under the Securities Act
of 1933, and is aware that the sale to it is being made in reliance on Rule
144A and acknowledges that it has received such information regarding the 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

  



 


B-16

















 


[TO BE ATTACHED TO GLOBAL EURO NOTES]


 


SCHEDULE OF INCREASES OR DECREASES IN GLOBAL EURO NOTE


 


The
initial principal amount of this Global Euro Note is €                       .  The following increases or decreases in this
Global Euro Note have been made:


 


	
  Date of

  Exchange

  	
   

  	
  Amount of
  decrease

  in Principal Amount

  of this Global Euro

  Note

  	
   

  	
  Amount of
  increase in

  Principal Amount of

  this Global Euro Note

  	
   

  	
  Principal
  amount of this

  Global Euro Note

  following such decrease or

  increase

  	
   

  	
  Signature
  of authorized

  signatory of Trustee or Notes

  Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


B-17

















 


OPTION OF HOLDER TO ELECT PURCHASE


 


If you want to elect to have this Euro Note purchased
by the Company pursuant to Section 4.10 (Asset Sale) or 4.15 (Change of
Control) of the Indenture, check the box:


 




	
  Asset Sale  o

  	
   

  	
  Change of Control  o

  






 


If you want to elect to have only part of this Euro
Note purchased by the Company pursuant to Section 4.10 (Asset Sale) or
4.15 (Change of Control) of the Indenture, state the amount (€1,000 or
an integral multiple thereof):


 


$


 


 


	
  Date:

  	
   

  	
   

  	
  Your Signature:

  	
   

  	
   

  
	
   

  	
  (Sign exactly as your name

  appears on the other side of

  this Note)

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signature Guarantee:

  	
   

  	
   

  
								



 


Signature must be guaranteed by a participant in a
recognized signature guaranty medallion program or other signature guarantor
program reasonably acceptable to the Trustee


 


B-18

















 


EXHIBIT C


 


[FORM OF FACE OF EXCHANGE DOLLAR NOTE]


 


[Global Notes Legend]


 


UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE
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 NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE
AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS
MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO
ON THE REVERSE HEREOF.


 

















 


	
  No.

  	
   

  	
  $                  

  



 


83/4% Senior Subordinated Note due 2012


 


	
   

  	
  CUSIP
  No. [144A:                     ]/[REG
  S:               ]/[IAI:
                ]

  
	
   

  	
  ISIN No. [144A:
                      ]/[REG
  S:
                ]/[IAI:
                ]

  
	
   

  	
  Common
  Code
  [144A:               ]/[REG
  S:               ]/[IAI:               ]

  



 


POLYPORE,
INC., a Delaware corporation, promises to pay to
[                  ],
or registered assigns, the principal sum
[of                      Dollars]
[listed on the Schedule of Increases or Decreases in Global Dollar Note
attached hereto](1) on May 15, 2012.


 


Interest Payment Dates:  May 15 and November 15.


Record Dates: 
May 1 and November 1.


 


Additional
provisions of this Dollar Note are set forth on the other side of this Note.


 


IN
WITNESS WHEREOF, the parties have caused this instrument to be duly executed.


 


	
   

  	
  POLYPORE,
  INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


Dated:


 


	
  TRUSTEE’S CERTIFICATE OF

  AUTHENTICATION

  
	
   

  
	
  THE BANK OF NEW YORK,

  as Trustee, certifies that this is

  one of the Dollar Notes

  referred to in the Indenture.

  



 


	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized
  Signatory

  



 












(1)                                  Use
the Schedule of Increases and Decreases language if Dollar Note is in
Global Form.


 


C-2

















 


*/                             If the Dollar Note is to be issued in global
form, add the Global Notes Legend and the attachment from Exhibit A captioned “TO
BE ATTACHED TO GLOBAL SECURITIES - SCHEDULE OF INCREASES OR DECREASES IN
GLOBAL NOTE”.


 


C-3

















 


[FORM OF REVERSE SIDE OF EXCHANGE DOLLAR NOTE]


 


83/4% Senior Subordinated Note due 2012


 


1.                                       Interest


 


POLYPORE,
INC., 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 Dollar Note at the
rate per annum shown above.  The Company
shall pay interest semiannually on May 15 and November 15 of each year,
commencing November 15, 2004. 
Interest on the Dollar Notes shall accrue from the most recent date to
which interest has been paid or duly provided for or, if no interest has been
paid or duly provided for, from May 13, 2004 until the principal hereof is
due.  Interest shall be computed on the
basis of a 360-day year of twelve 30-day months.  The Company shall pay interest on overdue principal at the rate
borne by the Dollar Notes, and it shall pay interest on overdue installments of
interest at the same rate to the extent lawful.


 


2.                                       Method of Payment


 


The
Company shall pay interest on the Dollar Notes (except defaulted interest) and
Additional Interest, if any, to the Persons who are registered Holders at the
close of business on May 1 and November 1 next preceding the interest
payment date even if Dollar Notes are canceled after the record date and on or
before the interest payment date. 
Holders must surrender Notes to a Paying Agent to collect principal
payments.  The Company shall pay
principal, premium, if any, and interest in money of the United States of
America that at the time of payment is legal tender for payment of public and
private debts.  Payments in respect of
the Dollar Notes represented by a Global Dollar Note (including principal,
premium, if any, interest and Additional Interest, if any) shall be made by
wire transfer of immediately available funds to the accounts specified by The
Depository Trust Company or any successor depositary.  The Company will make all payments in respect of a certificated
Dollar Note (including principal, premium, if any, interest and Additional
Interest, if any), at the office of each Paying Agent, except that, at the option
of the Company, payment of interest and Additional Interest, if any, may be
made by mailing a check to the registered address of each Holder thereof; provided, however, that payments on the Dollar
Notes may also be made, in the case of a Holder of at least $1,000,000
aggregate principal amount of Dollar Notes, 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 a
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,
The Bank of New York, a New York banking corporation (the “Trustee”), will act
as Dollar Paying Agent and Registrar. 
The Company may appoint and change any Paying Agent or Registrar without
notice.  The Company or any of its
domestically incorporated Wholly-Owned Subsidiaries may act as Paying Agent or
Registrar.


 


C-4

















 


4.                                       Indenture


 


The
Company issued the Dollar Notes under an Indenture dated as of May 13, 2004
(the “Indenture”), among PP Acquisition Corporation, the predecessor of the
Company, the Guarantors and the Trustee. 
The terms of the Dollar Notes 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 “TIA”).  Terms defined in
the Indenture and not defined herein have the meanings ascribed thereto in the
Indenture.  The Dollar Notes are subject
to all terms and provisions of the Indenture, and the Holders (as defined in
the Indenture) are referred to the Indenture and the TIA for a statement of
such terms and provisions.


 


The
Dollar Notes are senior subordinated unsecured obligations of the Company.  This Dollar Note is one of the Exchange
Dollar Notes referred to in the Indenture. 
The Dollar Notes include the Initial Dollar Notes and any Exchange
Dollar Notes issued in exchange for Initial Dollar Notes pursuant to the
Indenture.  The Initial Dollar Notes and
any Exchange Dollar Notes together with the Initial Euro Notes and any Exchange
Euro Notes are treated as a single class of securities under the
Indenture.  The Indenture imposes
certain limitations on the ability of the Company and its Restricted
Subsidiaries to, among other things, make certain Investments and other
Restricted Payments, pay dividends and other distributions, incur Indebtedness,
sell or otherwise dispose of assets including capital stock, enter into or
permit certain transactions with Affiliates, create or incur Liens and engage
in other business activities. The Indenture also imposes limitations on the
ability of the Company and each Guarantor to consolidate or merge with or into
any other Person or convey, transfer or lease all or substantially all of its
property.


 


To
guarantee the due and punctual payment of the principal of, if any, or interest
on in respect of the Dollar Notes and all other amounts payable by the Company
under the Indenture and the Dollar Notes when and as the same shall be due and
payable, whether at maturity, by acceleration or otherwise, according to the
terms of the Dollar Notes and the Indenture, each of the Guarantors have,
jointly and severally, unconditionally and irrevocably guaranteed the
Guaranteed Obligations on a senior subordinated basis pursuant to the terms of
the Indenture.


 


5.                                       Optional Redemption; Special Redemption


 


Except
as set forth in the following paragraphs, the Dollar Notes shall not be
redeemable at the Company’s option prior to May 15, 2008. Thereafter, the
Dollar Notes shall be subject to redemption at any time at the option of the
Company, in whole or in part, upon not less than 30 nor more than 60 days’
notice, at the redemption prices (expressed as percentages of principal amount
thereof) set forth below plus accrued and unpaid interest to the applicable
redemption date, if redeemed during the twelve month period commencing on May
15 of the year set forth below:


 


C-5

















 


	
  Year

  	
   

  	
  Redemption
  Price

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2008

  	
   

  	
  104.375

  	
  %

  
	
  2009

  	
   

  	
  102.188

  	
  %

  
	
  2010 and thereafter

  	
   

  	
  100.000

  	
  %

  



 


In
addition, prior to May 15, 2008, the Company may redeem the Dollar Notes at its
option, in whole at any time or in part from time to time, upon not less than
30 nor more than 60 days’ prior notice mailed by first-class mail to each
Holder’s registered address, at a redemption price equal to 100% of the
principal amount of the Dollar Notes redeemed plus the Applicable Premium as
of, and accrued and unpaid interest to, the applicable redemption date (subject
to the right of the Holders of record on the relevant record date to receive
interest due on the relevant interest payment date).


 


Notwithstanding
the foregoing, prior to May 15, 2007, the Company may at its option on one or
more occasions redeem the Dollar Notes (which includes Additional Dollar Notes,
if any) in an aggregate principal amount not to exceed 35% of the aggregate
principal amount of the Dollar Notes (which includes Additional Dollar Notes,
if any) originally issued at a redemption price (expressed as a percentage of
principal amount) of 108.75% plus accrued and unpaid interest to the redemption
date, with the net cash proceeds from one or more Equity Offerings; provided, however, that (i) at
least 65% of such aggregate principal amount of Dollar Notes (which includes
Additional Dollar Notes, if any) remains outstanding immediately after the
occurrence of each such redemption (other than Notes held, directly or
indirectly, by the Company or its Affiliates); and (ii) each such redemption
occurs within 60 days after the date of the related Equity Offering.


 


Notwithstanding
the foregoing, in the event that the Transactions have not been consummated on
or prior to May 20, 2004, then the Company shall mandatorily redeem all the
Notes on or prior to May 21, 2004, at a redemption price in cash equal to 100%
of the issue price of the Notes plus accrued and unpaid interest to the date of
redemption.  Notice of such redemption
shall be given to the Trustee no later than the close of business on May 20,
2004.


 


6.                                       Sinking Fund


 


The
Dollar Notes are not subject to any sinking fund.


 


7.                                       Notice of Redemption


 


Notice
of redemption will be mailed by first-class mail at least 30 days but not more
than 60 days before the redemption date to each Holder of Dollar Notes to be
redeemed at his, her or its registered address.  Dollar Notes in denominations larger than $1,000 may be redeemed
in part but only in whole multiples of $1,000. 
If money sufficient to pay the redemption price of and accrued and
unpaid interest on all Dollar Notes (or portions thereof) to be redeemed on the
redemption date is deposited with a 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 Dollar Notes (or such portions thereof)
called for redemption.


 


C-6

















 


8.                                       Repurchase of Dollar Notes at the Option of
the Holders upon Change of Control and Asset Sales


 


If
a Change of Control occurs, each Holder shall have the right, subject to
certain conditions specified in the Indenture, to require the Company to
repurchase all or a portion of such Holder’s Dollar Notes at a purchase price
equal to 101% of the principal amount thereof plus accrued interest to the date
of repurchase (subject to the right of the Holders of record on the relevant
record date to receive interest due on the relevant interest payment date), as
provided in, and subject to the terms of, the Indenture.


 


In
accordance with Section 4.10 of the Indenture, the Company will be
required to offer to purchase Dollar Notes upon the occurrence of certain
events.


 


9.                                       Subordination


 


The
Dollar Notes and Guarantees are subordinated to Senior Indebtedness, as defined
in the Indenture.  To the extent
provided in the Indenture, Senior Indebtedness must be paid before the Notes
and Guarantees may be paid.  The Company
and each Guarantor agrees, and each Holder by accepting a Dollar Note agrees,
to the subordination provisions contained in the Indenture and authorizes the Trustee
to give it effect and appoints the Trustee as attorney-in-fact for such
purpose.


 


10.                                 Denominations; Transfer; Exchange


 


The
Dollar Notes are in registered form, without coupons, in denominations of
$1,000 and integral multiples of $1,000. 
A Holder shall register the transfer of or exchange of Dollar Notes in
accordance with the Indenture.  Upon any
registration of transfer or exchange, the Registrar and the Trustee may require
a Holder, among other things, to furnish appropriate endorsements or transfer
documents and to pay any taxes required by law or permitted by the
Indenture.  The Registrar need not
register the transfer of or exchange any Dollar Notes selected for redemption
in whole or in part, except the unredeemed portion of any Dollar Note being
redeemed in part.  The Company shall not
be required (i) to issue, to register the transfer of or to exchange any Dollar
Notes during a period beginning at the opening of business 15 days before the
day of the mailing of notice of redemption and ending at the close of business
on such day, (ii) to register the transfer of or to exchange any Dollar Note so
selected for redemption in whole or in part, except the unredeemed portion of
any Dollar Note being redeemed in part or (iii) to register the transfer of or
to exchange a Dollar Note between a record date and the next succeeding
Interest Payment Date.


 


11.                                 Persons Deemed Owners


 


The
registered Holder of this Dollar Note shall be treated as the owner of it for
all purposes.


 


12.                                 Unclaimed Money


 


If
money for the payment of principal or interest remains unclaimed for two years,
the Trustee and a Paying Agent shall pay the money back to the Company at its
written request


 


C-7

















 


unless
an abandoned property law designates another Person.  After any such payment, the Holders entitled to the money must
look to the Company for payment as general creditors and the Trustee and a
Paying Agent shall have no further liability with respect to such monies.


 


13.                                 Discharge and Defeasance


 


Subject
to certain conditions, the Company at any time may terminate some of or all its
obligations under the Dollar Notes and the Indenture if the Company deposits
with the Trustee cash in United States dollars, non-callable Government
Obligations, or a combination of United States dollars and Government
Obligations, in such amounts as will be sufficient, in the opinion of a
nationally recognized firm of public accountant, to pay the principal amount at
maturity of, premium, if any, and interest on the Dollar Notes on the stated
date for payment thereof or on the applicable redemption date, as the case may
be.


 


14.                                 Amendment, Waiver


 


Subject
to certain exceptions set forth in the Indenture, (i) the Indenture, the
Guarantees or the Notes may be amended with the written consent of the Holders
of at least a majority in principal amount of the Notes then outstanding voting
as a single class and (ii) any past default or compliance with any provisions
of the Indenture, the Guarantees or the Notes may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding Notes
voting as a single class; provided,
however, that if any
amendment, waiver or other modification will only affect the Dollar Notes or
the Euro Notes, only the consent of the Holders of at least a majority in
principal amount of the then outstanding Dollar Notes or Euro Notes, as the
case may be, (and not the consent of the majority of all Notes) shall be
required.  Subject to certain exceptions
set forth in the Indenture, without the consent of any Holder, the Company, the
Guarantors and the Trustee may amend the Indenture, the Guarantees or the Notes
(i) to cure any ambiguity, omission, defect or inconsistency; (ii) to provide
for uncertificated Notes in addition to or in place of certificated Notes (provided that the uncertificated Notes
are issued in registered form for purposes of Section 163(f) of the Code,
or in a manner such that the uncertificated Notes are described in
Section 163(f)(2)(B) of the Code) or to alter the provisions of
Article 2 of the Indenture or the Appendix hereof relating to the form of
the Notes (including the related definitions) in a manner that does not
adversely affect any Holder; (iii) to provide for the assumption of the
Company’s or a Guarantor’s obligations to Holders of the Notes by a successor
to the Company or a Guarantor in case of a merger or consolidation; (iv) to
make any change that would provide any additional rights or benefits to the
Holders of the Notes or that does not adversely affect the legal rights under
the Indenture of any such Holder; (v) to comply with the requirements of the
SEC in order to effect or maintain the qualification of the Indenture under the
Trust Indenture Act; (vi) to provide for the issuance of Notes issued after the
Issue Date in accordance with the limitations set forth in the Indenture; (vii)
to release any Guarantor from its Guarantee in accordance with the Indenture;
(viii) or to allow any Guarantor to execute a supplemental indenture to the
Indenture and/or a Guarantee with respect to the Notes; or (ix) make any change
in Article 10 and Article 12 of the Indenture that would limit or
terminate the benefits available to any holder of Senior Debt of the Company or
a holder of Guarantor Senior Debt (or any Representative thereof) under such
Article 10 and Article 12.


 


C-8

















 


15.                                 Defaults and Remedies


 


Events
of Default include: (i) the failure to pay interest or Additional Interest, if
any, on any Notes when the same becomes due and payable if the default
continues for a period of 30 days (whether or not such payment shall be
prohibited by Article 10 or Article 12 of the Indenture); (ii) the
failure to pay the principal of or premium, if any, on any Notes when such
principal or premium, if any, becomes due and payable, at maturity, upon
redemption or otherwise (including the failure to make a payment to purchase
Notes tendered pursuant to a Change of Control Offer or a Net Proceeds Offer on
the date specified for such payment in the applicable offer to purchase)
(whether or not such payment shall be prohibited by Article 10 or
Article 12 of the Indenture); (iii) a default in the observance or
performance of any other covenant or agreement contained in the Indenture if
the default continues for a period of 30 days after the Company receives
written notice specifying the default (and demanding that such default be
remedied) from the Trustee or the Holders of at least 25% of the outstanding
principal amount of the Notes (except in the case of a default with respect to
Section 5.01 or Section 11.06 of the Indenture, which will constitute
an Event of Default with such notice requirement but without such passage of
time requirement); (iv) the failure to pay at final stated maturity (giving
effect to any applicable grace periods and any extensions thereof) the
principal amount of any Indebtedness of the Company or any Significant
Subsidiary of the Company (other than a Securitization Entity) or the
acceleration of the maturity of any such Indebtedness, if the aggregate
principal amount of such Indebtedness, together with the principal amount of
any other such Indebtedness, whether such Indebtedness now exists, or is
created after the date of the Indenture, in default for failure to pay principal
at final maturity or which has been accelerated, aggregates $20.0 million or
more at any time; (v) one or more judgments in an aggregate amount in excess of
$20.0 million (which are not covered by insurance or indemnity as to which the
insurer or a creditworthy indemnitor has not disclaimed coverage) shall have
been rendered against the Company or any of its Significant Subsidiaries or
group of Restricted Subsidiaries that, taken together (as of the latest audited
consolidated financial statements for the Company and its Restricted
Subsidiaries), would constitute a Significant Subsidiary, and such judgments
remain undischarged, unpaid or unstayed for a period of 60 days after such
judgment or judgments become final and non-appealable; (vi) certain events of
bankruptcy, insolvency or reorganization affecting the Company or any of its
Significant Subsidiaries or group of Restricted Subsidiaries that taken
together (as of the latest audited consolidated financial statements for the
Company and its Restricted Subsidiaries), would constitute a Significant
Subsidiary; and (vii) any Guarantee of a Significant Subsidiary, or group of
Restricted Subsidiaries that, taken together (as of the latest audited
consolidated financial statements for the Company and its Restricted
Subsidiaries) would constitute a Significant Subsidiary, ceases to be in full
force and effect (except as contemplated by the terms of the Indenture) or is
declared null and void in a judicial proceeding or any Guarantor that is a
Significant Subsidiary or group of Guarantors that taken together (as of the
latest audited consolidated financial statements of the Company and its
Restricted Subsidiaries) would constitute a Significant Subsidiary denies or
disaffirms its obligations under the Indenture or its Guarantee. If any Event
of Default occurs and is continuing, the Trustee or the Holders of at least 25%
in principal amount of the then outstanding Notes may declare all the Notes to
be due and payable. Notwithstanding the foregoing, in the case of an Event of
Default arising from certain events of bankruptcy with respect to the Company,
all outstanding Notes will become due and payable without further action or
notice. Holders may not enforce the Indenture or the Notes except as provided
in the


 


C-9

















 


Indenture.
Subject to certain limitations, Holders of a majority in principal amount of
the then outstanding Notes may direct the Trustee in its exercise of any trust
or power. The Trustee may withhold from Holders of the Notes notice of any
continuing Default or Event of Default (except a Default or Event of Default
relating to the payment of principal or interest or Additional Interest) if it
determines that withholding notice is in their interest. The Holders of a
majority in aggregate principal amount of the Notes then outstanding by notice
to the Trustee may on behalf of the Holders of all of the Notes waive any
existing Default or Event of Default and its consequences under the Indenture
except a continuing Default or Event of Default in the payment of interest
(including Additional Interest, if any) on, or the principal of, the Notes. The
Company is required to deliver to the Trustee annually a statement regarding
compliance with the Indenture, and the Company is required upon becoming aware
of any Default or Event of Default, to deliver to the Trustee a statement
specifying such Default or Event of Default.


 


16.                                 Trustee Dealings with the Company


 


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


 


17.                                 Authentication


 


This
Dollar Note 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 Dollar Note.


 


18.                                 Abbreviations


 


Customary
abbreviations may be used in the name of a Holder 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).


 


19.                                 Governing Law


 


THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.


 


20.                                 CUSIP Numbers, ISINs and Common Codes


 


The
Company has caused CUSIP numbers and ISINs and, in the case of the Euro Notes,
Common Codes, to be printed on the Notes and has directed the Trustee to use
CUSIP numbers and ISINs and, in the case of the Euro Notes, Common Codes, in
notices of redemption as a convenience to the Holders.  No representation is made as to the accuracy
of such numbers either as printed on the Notes or as contained in any notice of
redemption and reliance may be placed only on the other identification numbers
placed thereon.


 


C-10

















 


The Company will furnish to any Holder of Notes upon
written request and without charge to the Holder a copy of the Indenture which
has in it the text of this Note.


 


C-11

















 


ASSIGNMENT FORM


 


To
assign this Note, fill in the form below:


 


I
or we assign and transfer this Note 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 Note 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 Note.


 


	
  Signature
  Guarantee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
	
  Signature
  must be guaranteed by a participant in a recognized signature guaranty medallion
  program or other signature guarantor program reasonably acceptable to the
  Trustee

  	
   

  	
  Signature
  of Signature Guarantee

  
				



 


C-12

















 


[TO BE ATTACHED TO GLOBAL DOLLAR NOTES]


 


SCHEDULE OF INCREASES OR DECREASES IN GLOBAL DOLLAR NOTE


 


The
initial principal amount of this Global Dollar Note is
$                        .  The following increases or decreases in this
Global Dollar Note have been made:


 


	
  Date of

  Exchange

  	
   

  	
  Amount of
  decrease

  in Principal Amount

  of this Global Dollar

  Note

  	
   

  	
  Amount of
  increase in

  Principal Amount of

  this Global Dollar

  Note

  	
   

  	
  Principal
  amount of this

  Global Dollar Note

  following such decrease or

  increase

  	
   

  	
  Signature
  of authorized

  signatory of Trustee or Notes

  Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


C-13

















 


OPTION OF HOLDER TO ELECT PURCHASE


 


If you want to elect to have this Dollar Note
purchased by the Company pursuant to Section 4.10 (Asset Sale) or 4.15
(Change of Control) of the Indenture, check the box:


 




	
  Asset Sale  o

  	
   

  	
  Change of Control  o

  






 


If you want to elect to have only part of this Dollar
Note purchased by the Company pursuant to Section 4.10 (Asset Sale) or
4.15 (Change of Control) of the Indenture, state the amount ($1,000 or an
integral multiple thereof):


 


$


 


	
  Date:

  	
   

  	
   

  	
  Your Signature:

  	
   

  	
   

  
	
   

  	
  (Sign exactly as your name

  appears on the other side of

  this Note)

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signature Guarantee:

  	
   

  	
   

  
								



 


Signature must be guaranteed by a participant in a
recognized signature guaranty medallion program or other signature guarantor
program reasonably acceptable to the Trustee


 


C-14

















 


EXHIBIT D


 


[FORM OF FACE OF EXCHANGE EURO NOTE]


 




[Global Notes Legend]


 


UNLESS
THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE BANK OF
NEW YORK DEPOSITORY (NOMINEES) LIMITED, TO THE COMPANY OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN A NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
BANK OF NEW YORK DEPOSITORY (NOMINEES) LIMITED (AND ANY PAYMENT IS MADE TO SUCH
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE BANK OF NEW YORK
DEPOSITORY (NOMINEES) LIMITED), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF HAS AN INTEREST HEREIN.


 


TRANSFERS
OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
THE COMMON DEPOSITORY, TO NOMINEES OF THE COMMON DEPOSITORY OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.


 

















 


	
  No.

  	
   

  	
  €                  

  



 


83/4% Senior Subordinated Note due 2012


 


	
   

  	
  CUSIP
  No.
  [144A:                    ]/[REG
  S:               ]

  
	
   

  	
  ISIN
  No.
  [144A:                   ]/[REG
  S:               ]

  
	
   

  	
  Common
  Code
  [144A:               ]/[REG
  S:              ]

  



 


POLYPORE,
INC., a Delaware corporation, promises to pay to
[                 ],
or registered assigns, the principal sum
[of                    Euros]
[listed on the Schedule of Increases or Decreases in Global Euro Note
attached hereto](1) on May 15, 2012.


 


Interest Payment Dates:  May 15
and November 15.


 


Record Dates:  May 1 and
November 1.


 


Additional
provisions of this Euro Note are set forth on the other side of this Note.


 


IN
WITNESS WHEREOF, the parties have caused this instrument to be duly executed.


 


	
   

  	
  POLYPORE,
  INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


 


Dated:


 


	
  TRUSTEE’S CERTIFICATE OF

  AUTHENTICATION

  
	
   

  
	
  THE BANK OF NEW YORK,

  as Trustee, certifies that this is

  one of the Euro Notes

  referred to in the Indenture.

  



 


	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  



 












*/                       If the Euro Note is to be issued in global
form, add the Global Notes Legend and the attachment from Exhibit A captioned
“TO BE ATTACHED TO GLOBAL NOTES - SCHEDULE OF INCREASES OR DECREASES IN
GLOBAL NOTE”.


 


(1)                                  Use
the Schedule of Increases and Decreases language if Euro Note is in Global
Form.


 


D-2

















 


[FORM OF REVERSE SIDE OF EXCHANGE EURO NOTE]


 




83⁄4% Senior Subordinated Note due 2012


 


1.                                       Interest


 


POLYPORE,
INC., 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 Euro Note
at the rate per annum shown above.  The
Company shall pay interest semiannually on May 15 and November 15 of each
year, commencing November 15, 2004. 
Interest on the Euro Notes shall accrue from the most recent date to
which interest has been paid or duly provided for or, if no interest has been
paid or duly provided for, from May 13, 2004 until the principal hereof is
due.  Interest shall be computed on the
basis of a 360-day year of twelve 30-day months.  The Company shall pay interest on overdue principal at the rate
borne by the Euro Notes, and it shall pay interest on overdue installments of
interest at the same rate to the extent lawful.


 


2.                                       Method of Payment


 


The
Company shall pay interest on the Euro Notes (except defaulted interest and
Additional Interest, if any) to the Persons who are registered Holders at the
close of business on May 1 and November 1 next preceding the interest
payment date even if Dollar Notes are canceled after the record date and on or
before the interest payment date. 
Holders must surrender Euro Notes to a Paying Agent to collect principal
payments.  The Company shall pay
principal, premium, if any, and interest in money of a member state of the
European Union that at the time of payment is legal tender for payment of
public and private debts.  Payments in
respect of the Euro Notes represented by a Global Note (including principal,
premium, if any, interest and Additional Interest, if any) shall be made by
wire transfer of immediately available funds to the accounts specified by The
Depository Trust Company or any successor depositary.  The Company will make all payments in respect of a certificated
Euro Note (including principal, premium, if any, interest and Additional
Interest, if any), at the office of a Paying Agent, except that, at the option
of the Company, payment of interest and Additional Interest, if any, may be
made by mailing a check to the registered address of each Holder thereof; provided, however, that payments on the Euro
Notes may also be made, in the case of a Holder of at least €1,000,000
aggregate principal amount of Euro Notes, by wire transfer to a Euro account
maintained by the payee with a bank in member state of the European Union if such
Holder elects payment by wire transfer by giving written notice to the Trustee
or a 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,
The Bank of New York, will act as Euro Paying Agent.  The Company may appoint and change any Paying Agent or Registrar
without notice.  The Company or any of
its domestically incorporated Wholly-Owned Subsidiaries may act as Paying Agent
or Registrar.


 


D-3

















 


4.                                       Indenture


 


The
Company issued the Euro Notes under an Indenture dated as of May 13, 2004 (the
“Indenture”), among PP Acquisition Corporation, the predecessor of the Company,
the Guarantors and The Bank of New York, a New York banking corporation (the
“Trustee”).  The terms of the Euro Notes
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
“TIA”).  Terms defined in the Indenture
and not defined herein have the meanings ascribed thereto in the Indenture.  The Euro Notes are subject to all terms and
provisions of the Indenture, and the Holders (as defined in the Indenture) are
referred to the Indenture and the TIA for a statement of such terms and
provisions.


 


The
Euro Notes are senior subordinated unsecured obligations of the Company.  This Euro Note is one of the Exchange Euro
Notes referred to in the Indenture.  The
Euro Notes include the Initial Euro Notes and any Exchange Euro Notes issued in
exchange for Initial Euro Notes pursuant to the Indenture.  The Initial Euro Notes and any Exchange Euro
Notes together with the Initial Dollar Notes and the Exchange Dollar Notes are
treated as a single class of securities under the Indenture.  The Indenture imposes certain limitations on
the ability of the Company and its Restricted Subsidiaries to, among other
things, make certain Investments and other Restricted Payments, pay dividends
and other distributions, incur Indebtedness, sell or otherwise dispose of
assets including capital stock, enter into or permit certain transactions with
Affiliates, create or incur Liens and engage in other business activities. The
Indenture also imposes limitations on the ability of the Company and each
Guarantor to consolidate or merge with or into any other Person or convey,
transfer or lease all or substantially all of its property.


 


To
guarantee the due and punctual payment of the principal of, premium, if any, or
interest on in respect of the Euro Notes and all other amounts payable by the
Company under the Indenture and the Euro Notes when and as the same shall be
due and payable, whether at maturity, by acceleration or otherwise, according
to the terms of the Euro Notes and the Indenture, each of the Guarantors have,
jointly and severally, unconditionally and irrevocably guaranteed the
Guaranteed Obligations on a senior subordinated basis pursuant to the terms of
the Indenture.


 


5.                                       Optional Redemption; Special Redemption


 


Except
as set forth in the following paragraphs, the Euro Notes shall not be
redeemable at the Company’s option prior to May 15, 2008. Thereafter, the Euro
Notes shall be subject to redemption at any time at the option of the Company,
in whole or in part, upon not less than 30 nor more than 60 days’ notice, at
the redemption prices (expressed as percentages of principal amount thereof)
set forth below plus accrued and unpaid interest to the applicable redemption
date, if redeemed during the twelve month period commencing on May 15 of the
year set forth below:


 


D-4

















 


	
  Year

  	
   

  	
  Redemption
  Price

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2008

  	
   

  	
  104.375

  	
  %

  
	
  2009

  	
   

  	
  102.188

  	
  %

  
	
  2010 and thereafter

  	
   

  	
  100.000

  	
  %

  



 


In
addition, prior to May 15, 2008, the Company may redeem the Euro Notes, at its
option, in whole at any time or in part from time to time, upon not less than
30 nor more than 60 days’ prior notice mailed by first-class mail to each
Holder’s registered address, at a redemption price equal to 100% of the
principal amount of the Euro Notes redeemed plus the Applicable Premium as of,
and accrued and unpaid interest to, the applicable redemption date (subject to
the right of the Holders of record on the relevant record date to receive
interest due on the relevant interest payment date).


 


Notwithstanding
the foregoing, prior to May 15, 2007, the Company may at its option on one or
more occasions redeem the Euro Notes (which includes Additional Euro Notes, if
any) in an aggregate principal amount not to exceed 35% of the aggregate
principal amount of the Euro Notes (which includes Additional Dollar Notes, if
any) originally issued at a redemption price (expressed as a percentage of
principal amount) of 108.75% plus accrued and unpaid interest to the redemption
date, with the net cash proceeds from one or more Equity Offerings; provided, however, that (i) at
least 65% of such aggregate principal amount of Dollar Notes (which includes
Additional Dollar Notes, if any) remains outstanding immediately after the
occurrence of each such redemption (other than Notes held, directly or
indirectly, by the Company or its Affiliates); and (ii) each such redemption occurs
within 60 days after the date of the related Equity Offering.


 


Notwithstanding
the foregoing, in the event that the Transactions have not been consummated on
or prior to May 20, 2004, then the Company shall mandatorily redeem all the
Notes on or prior to May 21, 2004, at a redemption price in cash equal to 100%
of the issue price of the Notes plus accrued and unpaid interest to the date of
redemption.  Notice of such redemption
shall be given to the Trustee no later than the close of business on May 20,
2004.


 


6.                                       Sinking Fund


 


The
Euro Notes are not subject to any sinking fund.


 


7.                                       Notice of Redemption


 


Notice
of redemption will be mailed by first-class mail at least 30 days but not more
than 60 days before the redemption date to each Holder of Euro Notes to be
redeemed at his, her or its registered address.  Euro Notes in denominations larger than €1,000 may be redeemed in
part but only in whole multiples of €1,000. 
If money sufficient to pay the redemption price of and accrued and
unpaid interest on all Euro Notes (or portions thereof) to be redeemed on the
redemption date is deposited with a 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 Euro Notes (or such portions thereof) called
for redemption.


 


D-5

















 


8.                                      Repurchase of Euro Notes at the Option of the
Holders upon Change of Control and Asset Sales


 


If
a Change of Control occurs, each Holder shall have the right, subject to
certain conditions specified in the Indenture, to require the Company to
repurchase all or a portion of such Holder’s Euro Notes at a purchase price
equal to 101% of the principal amount thereof plus accrued interest to the date
of repurchase (subject to the right of the Holders of record on the relevant
record date to receive interest due on the relevant interest payment date), as
provided in, and subject to the terms of, the Indenture.


 


In
accordance with Section 4.10 of the Indenture, the Company will be
required to offer to purchase Euro Notes upon the occurrence of certain events.


 


9.                                       Subordination


 


The
Euro Notes and Guarantees are subordinated to Senior Indebtedness, as defined
in the Indenture.  To the extent
provided in the Indenture, Senior Indebtedness must be paid before the Euro
Notes and Guarantees may be paid.  The
Company and each Guarantor agrees, and each Holder by accepting a Euro Note
agrees, to the subordination provisions contained in the Indenture and
authorizes the Trustee to give it effect and appoints the Trustee as
attorney-in-fact for such purpose.


 


10.                                 Denominations; Transfer; Exchange


 


The
Euro Notes are in registered form, without coupons, in denominations of €1,000
and integral multiples of €1,000.  A
Holder shall register the transfer of or exchange of Euro Notes in accordance
with the Indenture.  Upon any
registration of transfer or exchange, the Registrar and the Trustee may require
a Holder, among other things, to furnish appropriate endorsements or transfer documents
and to pay any taxes required by law or permitted by the Indenture.  The Registrar need not register the transfer
of or exchange any Euro Notes selected for redemption in whole or in part,
except the unredeemed portion of any Euro Note being redeemed in part.  The Company shall not be required (i) to
issue, to register the transfer of or to exchange any Euro Notes during a
period beginning at the opening of business 15 days before the day of the
mailing of notice of redemption and ending at the close of business on such
day, (ii) to register the transfer of or to exchange any Euro Note so selected
for redemption in whole or in part, except the unredeemed portion of any Euro
Note being redeemed in part or (iii) to register the transfer of or to exchange
a Euro Note between a record date and the next succeeding Interest Payment
Date.


 


11.                                 Persons Deemed Owners


 


The
registered Holder of this Euro Note shall be treated as the owner of it for all
purposes.


 


D-6

















 


12.                                 Unclaimed Money


 


If
money for the payment of principal or interest remains unclaimed for two years,
the Trustee and a Paying Agent shall pay the money back to the Company at its
written request unless an abandoned property law designates another
Person.  After any such payment, the
Holders entitled to the money must look to the Company for payment as general
creditors and the Trustee and a Paying Agent shall have no further liability
with respect to such monies.


 


13.                                 Discharge and Defeasance


 


Subject
to certain conditions, the Company at any time may terminate some of or all its
obligations under the Notes and the Indenture if the Company deposits with the
Trustee cash in euros or EU Government Obligations, or a combination of euros
and EU Government Obligations, in such amounts as will be sufficient, in the
opinion of a nationally recognized firm of public accountants to pay the
principal amount at maturity of, premium, if any, and interest on the Notes on
the stated date for payment thereof or on the applicable redemption date, as
the case may be.


 


14.                                 Amendment, Waiver


 


Subject
to certain exceptions set forth in the Indenture, (i) the Indenture, the
Guarantees or the Notes may be amended with the written consent of the Holders
of at least a majority in principal amount of the Notes then outstanding voting
as a single class and (ii) any past default or compliance with any provisions
of the Indenture, the Guarantees or the Notes may be waived with the consent of
the Holders of a majority in principal amount of the then outstanding Notes
voting as a single class; provided,
however, that if any
amendment, waiver or other modification will only affect the Dollar Notes or
the Euro Notes, only the consent of the Holders of at least a majority in
principal amount of the then outstanding Dollar Notes or Euro Notes, as the
case may be, (and not the consent of the majority of all Notes) shall be
required.  Subject to certain exceptions
set forth in the Indenture, without the consent of any Holder, the Company, the
Guarantors and the Trustee may amend the Indenture, the Guarantees or the Notes
(i) to cure any ambiguity, omission, defect or inconsistency; (ii) to provide
for uncertificated Notes in addition to or in place of certificated Notes (provided that the uncertificated Notes
are issued in registered form for purposes of Section 163(f) of the Code,
or in a manner such that the uncertificated Notes are described in
Section 163(f)(2)(B) of the Code) or to alter the provisions of
Article 2 of the Indenture or the Appendix hereof relating to the form of
the Notes (including the related definitions) in a manner that does not
adversely affect any Holder; (iii) to provide for the assumption of the
Company’s or a Guarantor’s obligations to Holders of the Notes by a successor
to the Company or a Guarantor in case of a merger or consolidation; (iv) to
make any change that would provide any additional rights or benefits to the
Holders of the Notes or that does not adversely affect the legal rights under
the Indenture of any such Holder; (v) to comply with the requirements of the
SEC in order to effect or maintain the qualification of the Indenture under the
Trust Indenture Act; (vi) to provide for the issuance of Notes issued after the
Issue Date in accordance with the limitations set forth in the Indenture; (vii)
to release any Guarantor from its Guarantee in accordance with the Indenture;
(viii) or to allow any Guarantor to execute a supplemental indenture to the
Indenture and/or a Guarantee with respect to the Notes; or (ix) make any change
in Article 10 and Article 12 of the Indenture that would limit or
terminate the


 


D-7

















 


benefits
available to any holder of Senior Debt of the Company or a holder of Guarantor
Senior Debt (or any Representative thereof) under such Article 10 and
Article 12.


 


15.                                 Defaults and Remedies


 


Events
of Default include: (i) the failure to pay interest or Additional Interest, if
any, on any Notes when the same becomes due and payable if the default
continues for a period of 30 days (whether or not such payment shall be
prohibited by Article 10 or Article 12 of the Indenture); (ii) the
failure to pay the principal of or premium, if any, on any Notes when such
principal or premium, if any, becomes due and payable, at maturity, upon
redemption or otherwise (including the failure to make a payment to purchase
Notes tendered pursuant to a Change of Control Offer or a Net Proceeds Offer on
the date specified for such payment in the applicable offer to purchase)
(whether or not such payment shall be prohibited by Article 10 or
Article 12 of the Indenture); (iii) a default in the observance or
performance of any other covenant or agreement contained in the Indenture if
the default continues for a period of 30 days after the Company receives
written notice specifying the default (and demanding that such default be
remedied) from the Trustee or the Holders of at least 25% of the outstanding
principal amount of the Notes (except in the case of a default with respect to
Section 5.01 or Section 11.06 of the Indenture, which will constitute
an Event of Default with such notice requirement but without such passage of
time requirement); (iv) the failure to pay at final stated maturity (giving
effect to any applicable grace periods and any extensions thereof) the
principal amount of any Indebtedness of the Company or any Significant
Subsidiary of the Company (other than a Securitization Entity) or the
acceleration of the maturity of any such Indebtedness, if the aggregate
principal amount of such Indebtedness, together with the principal amount of
any other such Indebtedness, whether such Indebtedness now exists, or is
created after the date of the Indenture, in default for failure to pay
principal at final maturity or which has been accelerated, aggregates $20.0
million or more at any time; (v) one or more judgments in an aggregate amount
in excess of $20.0 million (which are not covered by insurance or indemnity as
to which the insurer or a creditworthy indemnitor has not disclaimed coverage)
shall have been rendered against the Company or any of its Significant
Subsidiaries or group of Restricted Subsidiaries that, taken together (as of
the latest audited consolidated financial statements for the Company and its
Restricted Subsidiaries), would constitute a Significant Subsidiary, and such
judgments remain undischarged, unpaid or unstayed for a period of 60 days after
such judgment or judgments become final and non-appealable; (vi) certain events
of bankruptcy, insolvency or reorganization affecting the Company or any of its
Significant Subsidiaries or group of Restricted Subsidiaries that taken
together (as of the latest audited consolidated financial statements for the
Company and its Restricted Subsidiaries), would constitute a Significant
Subsidiary; and (vii) any Guarantee of a Significant Subsidiary, or group of
Restricted Subsidiaries that, taken together (as of the latest audited
consolidated financial statements for the Company and its Restricted
Subsidiaries) would constitute a Significant Subsidiary, ceases to be in full
force and effect (except as contemplated by the terms of the Indenture) or is
declared null and void in a judicial proceeding or any Guarantor that is a
Significant Subsidiary or group of Guarantors that taken together (as of the
latest audited consolidated financial statements of the Company and its
Restricted Subsidiaries) would constitute a Significant Subsidiary denies or
disaffirms its obligations under the Indenture or its Guarantee. If any Event
of Default occurs and is continuing, the Trustee or the Holders of at least 25%
in principal amount of the then outstanding Notes may declare all the Notes to
be due and payable. Notwithstanding the


 


D-8

















 


foregoing,
in the case of an Event of Default arising from certain events of bankruptcy
with respect to the Company, all outstanding Notes will become due and payable
without further action or notice. Holders may not enforce the Indenture or the
Notes except as provided in the Indenture. Subject to certain limitations,
Holders of a majority in principal amount of the then outstanding Notes may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders of the Notes notice of any continuing Default or Event of
Default (except a Default or Event of Default relating to the payment of
principal or interest or Additional Interest) if it determines that withholding
notice is in their interest. The Holders of a majority in aggregate principal
amount of the Notes then outstanding by notice to the Trustee may on behalf of
the Holders of all of the Notes waive any existing Default or Event of Default
and its consequences under the Indenture except a continuing Default or Event
of Default in the payment of interest (including Additional Interest, if any)
on, or the principal of, the Notes. The Company is required to deliver to the
Trustee annually a statement regarding compliance with the Indenture, and the
Company is required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.


 


16.                                 Trustee Dealings with the Company


 


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


 


17.                                 Authentication


 


This
Euro Note 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 Euro Note.


 


18.                                 Abbreviations


 


Customary
abbreviations may be used in the name of a Holder 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).


 


19.                                 Governing Law


 


THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.


 


20.                                 CUSIP Numbers, ISINs and Common Codes


 


The
Company has caused CUSIP numbers and ISINs and, in the case of the Euro Notes,
Common Codes, to be printed on the Notes and has directed the Trustee to use
CUSIP numbers and ISINs and, in the case of the Euro Notes, Common Codes, in
notices of redemption as a convenience to the Holders.  No representation is made as to the accuracy
of such numbers


 


D-9

















 


either
as printed on the Notes or as contained in any notice of redemption and
reliance may be placed only on the other identification numbers placed thereon.


 


The
Company will furnish to any Holder of Notes upon written request and without
charge to the Holder a copy of the Indenture which has in it the text of this
Note.


 


D-10

















 


ASSIGNMENT FORM


 


To
assign this Note, fill in the form below:


 


I
or we assign and transfer this Note 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 Note 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 Note.


 


	
  Signature
  Guarantee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
	
  Signature
  must be guaranteed by a participant in a recognized signature guaranty
  medallion program or other signature guarantor program reasonably acceptable
  to the Trustee

  	
   

  	
  Signature
  of Signature Guarantee

  
				



 


D-11

















 


[TO BE ATTACHED TO GLOBAL EURO NOTES]


 


SCHEDULE OF INCREASES OR DECREASES IN GLOBAL EURO NOTE


 


The
initial principal amount of this Global Euro Note is €                                 .  The following increases or decreases in this
Global Euro Note have been made:


 


	
  Date of

  Exchange

  	
   

  	
  Amount of
  decrease

  in Principal Amount

  of this Global Euro

  Note

  	
   

  	
  Amount of
  increase in

  Principal Amount of

  this Global Euro Note

  	
   

  	
  Principal
  amount of this

  Global Euro Note

  following such decrease or

  increase

  	
   

  	
  Signature
  of authorized

  signatory of Trustee or Notes

  Custodian

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


D-12

















 


OPTION OF HOLDER TO ELECT PURCHASE


 


If you want to elect to have this Euro Note purchased
by the Company pursuant to Section 4.10 (Asset Sale) or 4.15 (Change of
Control) of the Indenture, check the box:


 




	
  Asset Sale  o

  	
   

  	
  Change of Control  o

  






 


If you want to elect to have only part of this Euro
Note purchased by the Company pursuant to Section 4.10 (Asset Sale) or
4.15 (Change of Control) of the Indenture, state the amount (€1,000 or
an integral multiple thereof):


 


$


 


	
  Date:

  	
   

  	
   

  	
  Your Signature:

  	
   

  	
   

  
	
   

  	
  (Sign exactly as your name

  appears on the other side of

  this Note)

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signature Guarantee:

  	
   

  	
   

  
								



 


 


Signature must be guaranteed by a participant in a
recognized signature guaranty medallion program or other signature guarantor
program reasonably acceptable to the Trustee


 


D-13

















 


EXHIBIT E


 


Form of

Transferee Letter of Representation


 


PP
Acquisition Corporation


 


c/o
The Bank of New York

101 Barclay Street, Fl. 21W

New York, New York  10286


 


Ladies
and Gentlemen:


 


This
certificate is delivered to request a transfer of $/€[     ] principal amount of the 83⁄4% Senior
Subordinated Notes due 2012 (the “Notes”) of PP ACQUISITION CORPORATION (such
corporation, and its successors and assigns under the Indenture, including
Polypore, Inc. following the merger of PP Acquisition with and into Polypore,
Inc., being herein called the “Company”).


 


Upon
transfer, the Notes would be registered in the name of the new beneficial owner
as follows:


 


Name:                                                  


Address:                                               


Taxpayer
ID Number:                          


 


 


The
undersigned represents and warrants to you that:


 


1.                                       We are an institutional “accredited investor”
(as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of
1933, as amended (the “Securities Act”)), purchasing for our own account or for
the account of such an institutional “accredited investor” at least $250,000
principal amount of the Notes, and we are acquiring the Notes not with a view
to, or for offer or sale in connection with, any distribution in violation of
the Securities Act.  We have such
knowledge and experience in financial and business matters as to be capable of evaluating
the merits and risks of our investment in the Notes, and we invest in or
purchase securities similar to the Notes in the normal course of our
business.  We, and any accounts for
which we are acting, are each able to bear the economic risk of our or its
investment.


 


2.                                       We understand that the Notes have not been
registered under the Securities Act and, unless so registered, may not be sold
except as permitted in the following sentence. 
We agree on our own behalf and on behalf of any investor account for
which we are purchasing Notes to offer, sell or otherwise transfer such Notes
prior to the date that is 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 Notes (or any predecessor thereto) (the “Resale
Restriction Termination Date”) only (a) to the Company, (b) pursuant to a
registration statement


 

















 


that
has been declared effective under the Securities Act, (c) in a transaction
complying with the requirements of Rule 144A under the Securities Act (“Rule
144A”), to a person we reasonably believe is a qualified institutional buyer
under Rule 144A (a “QIB”) that is purchasing for its own account or for the
account of a QIB and to whom notice is given that the transfer is being made in
reliance on Rule 144A, (d) pursuant to offers and sales that occur outside the
United States within the meaning of Regulation S under the Securities Act, (e)
to an institutional “accredited investor” within the meaning of Rule 501(a)(1),
(2), (3) or (7) under the Securities Act that is purchasing for its own account
or for the account of such an institutional “accredited investor,” in each case
in a minimum principal amount of Notes of $250,000, or (f) pursuant to any
other available exemption from the registration requirements of the Securities
Act, subject in each of the foregoing cases to any requirement of law that the
disposition of our property or the property of such investor account or
accounts be at all times within our or their control and in compliance with any
applicable state securities laws.  The
foregoing restrictions on resale will not apply subsequent to the Resale
Restriction Termination Date.  If any
resale or other transfer of the Notes is proposed to be made pursuant to clause
(e) above prior to the Resale Restriction Termination Date, the transferor
shall deliver a letter from the transferee substantially in the form of this
letter to the 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 Notes 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 Notes pursuant to clause (d), (e) or (f) above to
require the delivery of an opinion of counsel, certifications or other
information satisfactory to the Company and the Trustee.


 


	
  Dated:
  

  	
   

  	
   

  
	
   

  
	
   

  	
  TRANSFEREE:

  	
   

  	
  ,

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
								



 


E-2

















 


EXHIBIT F


 


[FORM OF SUPPLEMENTAL INDENTURE]


 


SUPPLEMENTAL
INDENTURE (this “Supplemental Indenture”) dated as of 
[                   
], among [GUARANTOR] (the “New Guarantor”), a subsidiary of POLYPORE, INC., a
Delaware corporation (the “Company”), and THE BANK OF NEW YORK, a New York
banking corporation, as trustee under the indenture referred to below (the
“Trustee”).


 


W I T N E S S E T H :


 


WHEREAS
the Company and the existing Guarantors has heretofore executed and delivered
to the Trustee an Indenture (as amended, supplemented or otherwise modified,
the “Indenture”) dated as of May 13, 2004, providing for the issuance of the
Company’s U.S. Dollar-denominated 83⁄4% Senior Subordinated Notes due 2012 (the
“Dollar Notes”) and Euro-denominated 83⁄4% Senior Subordinated Notes due 2012
(the “Euro Notes” and, together with the Dollar Notes, the “Notes”), initially
in the aggregate principal amount of $225,000,000 and €150,000,000,
respectively;


 


WHEREAS
Section 11.09 of the Indenture provides that under certain circumstances
the Company is required to cause the New Guarantor to execute and deliver to
the Trustee a supplemental indenture pursuant to which the New Guarantor shall
unconditionally guarantee all the Company’s obligations under the Notes
pursuant to a Senior Subordinated Guarantee on the terms and conditions set
forth herein; and


 


WHEREAS
pursuant to Section 9.01 of the Indenture, the Trustee, the Company and
the existing Guarantors are authorized to execute and deliver this Supplemental
Indenture;


 


NOW
THEREFORE, in consideration of the foregoing and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the New Guarantor,
the Company, and the Trustee mutually covenant and agree for the equal and
ratable benefit of the holders of the Notes as follows:


 


1.                                       Defined Terms.  As used
in this Supplemental Indenture, terms defined in the Indenture or in the
preamble or recital hereto are used herein as therein defined, except that the
term “Holders” in this Guarantee shall refer to the term “Holders” as defined
in the Indenture and the Trustee acting on behalf of and for the benefit of
such Holders.  The words “herein,”
“hereof” and hereby and other words of similar import used in this Supplemental
Indenture refer to this Supplemental Indenture as a whole and not to any
particular section hereof.


 


2.                                       Agreement to Guarantee.  The
New Guarantor hereby agrees, jointly and severally with all existing Guarantors
(if any), to unconditionally guarantee the Company’s obligations under the
Notes on the terms and subject to the conditions set forth in Articles 11 and
12 of the Indenture and to be bound by all other applicable provisions of the
Indenture and the Notes and to perform all of the obligations and agreements of
a Guarantor under the Indenture.


 

















 


3.                                       Notices.  All notices or other communications
to the New Guarantor shall be given as provided in Section 13.02 of the
Indenture.


 


4.                                       Ratification of Indenture; Supplemental
Indentures Part of Indenture.  Except as expressly amended hereby, the
Indenture is in all respects ratified and confirmed and all the terms,
conditions and provisions thereof shall remain in full force and effect.  This Supplemental Indenture shall form a
part of the Indenture for all purposes, and every holder of Notes heretofore or
hereafter authenticated and delivered shall be bound hereby.


 


5.                                       Governing Law.  THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.


 


6.                                       Trustee Makes No Representation.  The
Trustee makes no representation as to the validity or sufficiency of this
Supplemental Indenture.


 


7.                                       Counterparts.  The
parties may sign any number of copies of this Supplemental Indenture.  Each signed copy shall be an original, but
all of them together represent the same agreement.


 


8.                                       Effect of Headings.  The
Section headings herein are for convenience only and shall not effect the
construction thereof.


 


F-2

















 


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


 


	
   

  	
  [NEW GUARANTOR]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  POLYPORE, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
  THE BANK OF NEW YORK, AS TRUSTEE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  



 


F-3

















 


Schedule I


 


Permitted Acquisition Payments


 


Payment
to Warburg Pincus Private Equity VIII, L.P. and Warburg Pincus International
Partners, L.P., representing reimbursement for out-of-pocket expenses incurred
in connection with the Transactions, not to exceed $6,500,000 in the aggregate.