ACQUIRED
A "RESTRICTED" SECURITY WHICH HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT;
(II) IT WILL NOT OFFER, SELL OR OTHERWISE TRANSFER THIS SECURITY, PRIOR TO THE
DATE (THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS (OR SUCH
SHORTER PERIOD AS SHALL BE PERMITTED AS A RESULT OF AN AMENDMENT TO THE RULES
UNDER THE SECURITIES ACT IN RESPECT THEREOF) AFTER THE LATER OF THE DATE OF
ORIGINAL ISSUANCE HEREOF AND THE LAST DATE ON WHICH MONMOUTH CAPITAL CORPORATION
(THE "COMPANY") OR ANY "AFFILIATE" OF THE COMPANY WAS THE OWNER OF THIS SECURITY
(OR ANY PREDECESSOR OF SUCH SECURITY) EXCEPT (A) TO THE COMPANY, (B) PURSUANT TO
A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT OR (C) PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY APPLICABLE
JURISDICTION; AND (III) IT WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO,
NOTIFY ANY PURCHASER FROM IT OF THIS SECURITY OF THE RESALE RESTRICTIONS SET
FORTH IN (II) ABOVE. IF ANY RESALE OR OTHER TRANSFER OF THIS SECURITY IS
PROPOSED TO BE MADE PURSUANT TO CLAUSE (II) (C) ABOVE PRIOR TO THE RESALE
RESTRICTION TERMINATION DATE, THE TRANSFEROR SHALL DELIVER A LETTER FROM THE
TRANSFEREE CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THIS SECURITY. ANY OFFER, SALE OR OTHER DISPOSITION
PURSUANT TO THE FOREGOING CLAUSE (II) (C) IS SUBJECT TO THE RIGHT OF THE ISSUER
OF THIS SECURITY AND THE TRUSTEE TO REQUIRE THE DELIVERY OF AN OPINION OF
COUNSEL, CERTIFICATIONS OR OTHER INFORMATION ACCEPTABLE TO THEM IN FORM AND
SUBSTANCE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE
RESALE RESTRICTION TERMINATION DATE.
ANY PURCHASER OR HOLDER OF THESE SECURITIES OR ANY INTEREST IN THESE
SECURITIES WILL BE DEEMED TO HAVE REPRESENTED AND WARRANTED BY ITS PURCHASE AND
HOLDING OF THIS SECURITY OR INTEREST IN THIS SECURITY THAT EITHER (I) NO PART OF
THE ASSETS TO BE USED TO PURCHASE THE DEBENTURES CONSTITUTES ASSETS OF ANY
EMPLOYEE BENEFIT PLAN (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED, REFERRED TO AS ERISA) THAT IS SUBJECT
TO TITLE I OF ERISA OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED, REFERRED TO AS THE CODE; OR (II) PART OF THE ASSETS TO BE USED TO
PURCHASE THE DEBENTURES CONSTITUTE ASSETS OF ONE OR MORE EMPLOYEE BENEFIT PLANS
SUBJECT TO TITLE I OF ERISA OR SECTION 4975 OF THE CODE AND THE PURCHASE AND
HOLDING OF SUCH DEBENTURES IS EXEMPT FROM THE PROHIBITED TRANSACTION RULES OF
SECTION 4975 OF THE CODE AND SECTION 406 OF ERISA OR THE PURCHASE AND HOLDING OF
SUCH DEBENTURES WOULD NOT RESULT IN SUCH A PROHIBITED TRANSACTION.
8% Convertible Subordinated Debentures due 2013
No. ____ $_____________
MONMOUTH CAPITAL CORPORATION
promises to pay to_______________________________________________, or
registered assigns, the principal amount of
_____________________________________________