Document:

EX-10.1

 

Exhibit 10.1

WITHOUT PREJUDICE

SUBJECT TO CONTRACT

SETTLEMENT AND COMPROMISE AGREEMENT

This Agreement is made on 13th December 2006 between:

	(1)	 	MarketAxess Europe Limited of 71 Fenchurch Street, London EC3M 4BS (the “Company”)

       And

	(2)	 	Iain Baillie of Wychwood Lodge, Swinbrook, Oxfordshire, OX18 4ED (the “Employee”)

The Parties have agreed the following:

Definitions

	 	 	 
	 
	 	 
	“Additional Tax”

	 	means income tax, employee’s national insurance
contributions, interest and/or penalties thereon arising
in respect of the payments made under this Agreement;
	 
	 	 
	“Adviser”

	 	means Adele Martins of Magrath Solicitors, who is a
relevant independent adviser as defined in section
203(3A) of the Employment Rights Act 1996;
	 
	 	 
	“Employment”

	 	means the Employee’s employment with the Company,
including the terms set out in the employment agreement
dated 11 February 2003 and executed by the Employee on 14
February 2003 (the “Employment Agreement”);
	 
	 	 
	“Group”

	 	means all Group Companies; and
	 
	 	 
	“Group Company”

	 	means the Company and any associated companies (as
defined in section 435 of the Insolvency Act 1986) of the
Company and “Group Companies” will be interpreted
accordingly.

	1.	 	The Employee’s Employment will terminate with effect on 29th December 2006 (the
“Termination Date”).
	 
	2.	 	The Employee will be paid his basic salary and will receive any accrued holiday entitlement
up to and including the Termination Date (less all deductions the Company is required by law
to make) in the next most convenient payroll run. The Employee is working out his notice
period during his final month of employment, and he will not be paid in lieu.
	 
	3.	 	Subject to all the conditions in clause 5 below being fulfilled by the Employee (or waived by
the Company) a) the Company agrees to pay the Employee as “ex gratia” a sum of GBP210,000.00
(less all deductions the Company is required by law to make) on January 25, 2007 by way of
compensation for loss of the Employment; and b) the Company also agrees to pay the Employee
the sum of GBP 173,000.00 (less all deductions the Company is required by law to make) as a
2006 year-end discretionary bonus on January 25, 2007.
	 
	4.	 	The payment referred to in clause 3a will be subject to the deduction of income tax at the
basic rate of 22% except for the first £30,000. The first £30,000 of the payment referred to
in clause 3 will be paid without any deductions for income tax or national insurance
contributions on the parties’ understanding that such payment qualifies for the exceptions set
out in the Income Tax (Earnings and Pensions) Act 2003. The Employee will be responsible for
any Additional Tax which arises for payment as a consequence of this Agreement, except to the
extent that the Company has made or does make an actual deduction in respect of such
liability. Further, the Employee will

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WITHOUT PREJUDICE

SUBJECT TO CONTRACT

	 	 	indemnify the Company in respect of any assessments, determination or demands levied or
made by the H.M.R.C. in respect of such liability and any consequential interest, charges
or penalties arising, save for any interest, charges or penalties incurred by reason of any
delay by the Company in meetings its liabilities after they have been assessed.

	5.	 	The payment referred to in clause 3 above is subject to the following:

	 	5.1	 	the Employee entering into this Agreement and returning a copy duly signed by
himself and an Adviser’s certificate in the form annexed to this Agreement; and
	 
	 	5.2	 	the Employee signing a further version of this Agreement after the
Termination Date and returning the signed copy to the Company as well as an updated
Adviser’s certificate, to indicate the Employee’s confirmation of the waivers
contained in this Agreement as at that date.

	6.	 	The terms of this Agreement are in full and final settlement of all and any claims or other
rights of action whatsoever and howsoever arising (whether under the laws of England and
Wales, those of the European Union, the State of Delaware in the U.S.A., or any other law, and
whether such claims are known or unknown to the parties and whether or not they are or could
be in the contemplation of the parties at the time of signing this Agreement, including claims
which as a matter of law do not at the date of this Agreement exist and whose existence cannot
currently be foreseen and any claims or rights of action arising from a subsequent
retrospective change or clarification of the law) which the Employee now has or may in the
future have against the Company or any Group Company or any director, employee officer or
agent (whether past or present) of the Company or any Group Company and the Employee hereby
agrees to waive any such claims or rights of action. There will be excluded from this clause
(i) any personal injury claims of which the Employee is unaware as at the date of signing this
Agreement (excluding any claim arising out of any act of discrimination); (ii) any claims for
pension rights accrued to the Termination Date; (iii) any claims to his vested restricted
stock awards and his vested stock options, in accordance with the relevant stock incentive
plan(s); and (iv) any rights of action which would render this clause void or unenforceable
(whether in whole or in part).

	7.	 	The waiver in clause 6 includes, without limitation, a waiver of the following, in respect of
which the Employee will refrain from instituting or continuing with a
complaint:

	 	7.1	 	of unfair dismissal pursuant to Part X of the Employment Rights Act 1996;
	 
	 	7.2	 	of wrongful dismissal and/or breach of contract, including but not limited to
a payment in lieu of notice and/or a breach of the implied term of trust and
confidence;
	 
	 	7.3	 	in respect of salary, bonus, commission, holiday pay or similar payments;
	 
	 	7.4	 	pursuant to Part II of the Employment Rights Act 1996 that an unauthorised
deduction from wages has been made;
	 
	 	7.5	 	that a statutory redundancy payment has not been made pursuant to Part XI of
the Employment Rights Act 1996;
	 
	 	7.6	 	under the Working Time Regulations 1998;

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WITHOUT PREJUDICE

SUBJECT TO CONTRACT

	 	7.7 	 	that the Employee has been subjected to a detriment having made a protected
disclosure, in contravention of the Employment Rights Act 1996, in each case against
the Company or any Group Company or any director, employee, officer or agent (whether
past or present) of the Company or any Group company before an employment tribunal in
respect of the Employment or termination thereof with the Company;
	 
	 	7.8	 	in respect of any breach of the Employment Act 2002 (Dispute Resolution)
Regulations 2004;
	 
	 	7.9	 	in respect of any breach of the Data Protection Act 1998;
	 
	 	7.10	 	in respect of equal pay under the Equal Pay Act 1970;
	 
	 	7.11	 	of disability discrimination pursuant to the Disability Discrimination Act
1995, as amended;
	 
	 	7.12	 	of race discrimination pursuant to Parts I and II of the Race Relations Act
1976;
	 
	 	7.13	 	of sex discrimination under the Sex Discrimination Act 1975;
	 
	 	7.14	 	of sexual orientation discrimination contrary to the Employment Equality
(Sexual Orientation) Regulations 2003;
	 
	 	7.15	 	of religious or belief discrimination contrary to the Employment Equality
(Religion or Belief) Regulations 2003;
	 
	 	7.16	 	of age discrimination pursuant to parts I and II of the Employment Equality
(Age) Regulations 2006;
	 
	 	7.17	 	relating to a written statement of reasons for dismissal under section 92
Employment Rights Act 1996;
	 
	 	7.18	 	that the provisions of the National Minimum Wage Act 1998 have been
contravened;
	 
	 	7.19	 	that the provisions of the Transnational Information and Consultation of
Employees Regulations 1999 have been contravened;
	 
	 	7.20	 	that the provisions of the Part-Time Workers (Prevention of Less Favourable
Treatment) Regulations 2000 have been contravened;
	 
	 	7.21	 	that the provisions of the Fixed-term Employees (Prevention of Less
Favourable Treatment) Regulations 2002 have been contravened;
	 
	 	 	 	and (for the avoidance of any doubt) any such complaints are hereby waived whether
arising before or after entering into this agreement.

	8.	 	The Employee undertakes and warrants that neither he, nor anyone acting on his behalf, has or
will present or issue any application, claim form, summons, proceedings or process against any
Company, Group Company or its or their officers, directors or employees (in each case, present
or former) in respect of the matters referred to in clauses 6 and/or 7 above.

	9.	 	The Employee warrants and represents that:

	 	9.1	 	save for the claims detailed in clause 7 above, he is not aware of any other
claim, whether statutory or not, that he may have against the Company or any Group
Company or any employee, agent or officer (whether past or

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WITHOUT PREJUDICE

SUBJECT TO CONTRACT

	 	 	 	present) of the Company or any Group Company arising out of the Employee’s
Employment or any act or omission relating to his Employment or relating to,
arising out of or connected to the events leading to and/or the manner of its
termination and that he has provided the Adviser with all available information
which the Adviser requires in order to provide the advice referred to in clause 15
below;
	 
	 	9.2	 	as at the date of this Agreement, the Employee is not aware of any facts or
matters which might give rise to a claim for personal injury against the Company,
Group Company or its or their officers, directors or employees (in each case, present
or former);
	 
	 	9.3	 	there are no matters of which he is aware relating to any acts or omissions
by him or any other director, officer, employee or agent of the Company or any Group
Company which, if disclosed to the Company would or might affect the decision of the
Company to make the payments referred to in clause 3 above; and
	 
	 	9.4	 	he is not owed any sum by the Company or any Group Company (save for the
payment under clause 3).

	10.	 	The Employee acknowledges that the Company has agreed the terms of this Agreement in reliance
on the undertakings in clauses 7 and 8, as well as in reliance on the representations set out
in clause 9 above. In the event of any breach of those clauses any payment (or part thereof)
made to the Employee under this Agreement (aggregated with the value of any benefits provided)
must be repaid to the Company immediately and will be recoverable by the Company as a debt, to
the extent only that such payment (or part thereof) represents a reasonable assessment of the
loss incurred by the Company as a result of such breach. The Employee shall also indemnify
the Company in full and keep the Company fully indemnified for and against all and any claims,
demands, judgments, orders, liabilities, damages, expenses or costs including without
limitation all reasonable legal and professional fees and disbursements (together with VAT
thereon) incurred by the Company arising out of or in connection with any material breach by
the Employee of the terms of this Agreement.

	11.	 	The Company will pay the Employee all outstanding expenses properly and legitimately incurred
on behalf of Company in the proper performance of the Employee’s duties to the Termination
Date on production of appropriate invoices and receipts in accordance with normal Company
policy provided that such claims are submitted within 14 days of the Termination Date. The
Employee will return to the Company all property belonging to the Company or any Group Company
including but not limited to any keys, security pass, credit or charge cards, business
equipment, his company car, mobile phone, palm pilot, laptop and printer, fax machine, files,
records, documents, correspondence, computer disks and data, client/customer lists and all
Company and Group information and copies thereof, however held and whether in physical or
electronic form and any other property belonging to the Company or any Group Company that the
Employee has in his possession or custody or which is under the Employee’s control, on or
before the Termination Date.

	12.	 	The Employee acknowledges and confirms that clauses 16 (Confidential Information), 17
(Intellectual Property Rights) and 22 (Restrictions after Termination of Employment) in the
Employment Agreement continue to have effect after its termination without any further
consideration by the Company.

	13.	 	Both Employee and Employer undertake that they will not make any public announcement,
statement or comment (whether to the media or otherwise) concerning:

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WITHOUT PREJUDICE

SUBJECT TO CONTRACT

	 	13.1	 	the terms of this Agreement and/or the payments the Company has agreed to
make;
	 
	 	13.2	 	the circumstances of the termination of the employment and any offices with
the Company and Group Company; and
	 
	 	13.3	 	anything that may be detrimental to either party or any Group Company,
whether to their reputations or otherwise,

except to their professional advisers (and in the case of the Employee appropriate members
of his immediate family) and/or as required by law or any relevant regulatory body.

	14.	 	
The Company will provide the Employee with a standard reference in or substantially in the
terms set out in Appendix 1. In the event any material fact or allegation becomes known to
the Company after the date of this Agreement which, had it been known at that time, would or
might have affected the terms of the reference the Company was willing to make, the Company
may (after giving notice to the Employee of its reasons for doing so) decline to give a
reference at all or may give a reference with such modifications to the draft attached to this
Agreement as the circumstances require.

	15.	 	

The Employee acknowledges that, before signing this Agreement, he received independent legal
advice from the Adviser, a solicitor in practice with Magrath Solicitors as to the terms and
effect of this Agreement and in particular its effect on the Employee’s ability to pursue his
rights before an employment tribunal. The Employee further acknowledges that he has been
advised by the Adviser that there is in force and was, at the time he received the advice
referred to above, a contract of insurance or an indemnity provided for members of a
profession or professional body covering the risk of a claim by the Employee in respect of
loss arising in consequence of that advice. The Company agrees to contribute up to £750 plus
VAT towards any costs arising in connection with the termination of the Employee’s employment
and the signing of this Agreement. Payment will be made direct to the Employee’s legal
advisers within 14 days of production of an appropriate invoice addressed to the Employee but
marked as payable by the Company.

	16.	 	
It is agreed that the conditions regulating compromise agreements under section 203 of the
Employment Rights Act 1996, section 72 of the Race Relations Act 1976, Regulation 35 of the
Working Time Regulations 1998, the Sex Discrimination Act 1975, Disability Discrimination Act
1995, the Employment Equality (Sexual Orientation) Regulations 2003, the Employment Equality
(Religion or Belief) Regulations 2003, Schedule 5 to the Employment Equality (Age) Regulations
2006, Section 49 of the National Minimum Wage Act 1998, Regulation 41 of the Transnational
Information and Consultation of Employees Regulations 1999, Regulation 9 of the Part-time
Workers (Prevention of Less Favourable Treatment) Regulations 2000 and Regulation 10 of the
Fixed-term Employees (Prevention of Less Favourable Treatment) Regulations 2002 are satisfied
in relation to the Agreement.

	17.	 	
By signing the Adviser’s certificate(s), the Adviser confirms that the Adviser:

	 	17.1	 	has advised the Employee as to the terms and effect of this Agreement and in
particular its effect on the Employee’s ability to pursue his rights before an
employment tribunal;
	 
	 	17.2	 	is covered by a contract of insurance, or an indemnity provided for members
of a profession or professional body covering the risk of a claim by the Employee in
respect of loss arising in consequence of the advice; and

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WITHOUT PREJUDICE

SUBJECT TO CONTRACT

		17.3	 	at the time of giving the advice, the Adviser was a “qualified lawyer” as
defined in section 203(3A) and “independent” as defined in Section 203(4) and section
203(B) respectively of the Employment Rights Act 1996.

	18.	 	This Agreement does not constitute an admission by the Company that it has breached any law
or regulation, or that the Employee has any claims against the Company or any Group Company,
or employee, agent or officer (whether past or present) of the Company or any Group Company.

	19.	 	The Contracts (Rights of Third Parties) Act 1999 applies to this Agreement. The Employee’s
obligations under this Agreement may be enforced by any Group Company and any of their
directors, employees, officers or agents (whether past or present).

	20.	 	This Agreement contains the whole agreement between the parties relating to the subject
matter of this Agreement at the date of signing to the exclusion of any terms implied by law
which may be excluded by contract and supersedes any previous written or oral agreement
between the parties in relation to the matters dealt with in the Agreement.

	21.	 	This Agreement shall be governed by and interpreted in accordance with English Law. Each
party submits to the exclusive jurisdiction of the English Courts in relation to any claim or
matter arising under this Agreement.

	22.	 	Notwithstanding that this Agreement is headed “Without Prejudice” and “Subject to Contract”,
it will become open and binding when executed by both parties.

 

Appendix 1

Clause 14 — Reference

(Address of new employer)

Dear Sir,

This letter is to confirm that Iain Baillie was employed in the position of Head of MarketAxess
Europe and was employed between 24th March 2003 and 29th December 2006.

Yours sincerely,

 

6

 

WITHOUT PREJUDICE

SUBJECT TO CONTRACT

SIGNED on behalf of

The Company

	 	 	 	 	 
	By:  	/s/ James
N.B. Rucker	 
	 	Name:	 	James N.B. Rucker	 
	 	Title:	 	Chief Financial Officer	 
	 	 	 	 	 

SIGNED by

The Employee

	 	 	 	 	 
	By:  	/s/ Iain N. Baillie	 
	 	Name:	 	Iain N. Baillie	 
	 	Title:	 	Head of MarketAxess Europe	 

7EX-4.1

 

Exhibit 4.1

EXECUTION VERSION

 

BUFFETS, INC.

as the Company

the GUARANTORS named herein

$300,000,000 12 1/2% SENIOR NOTES DUE 2014

 

INDENTURE

Dated as of November 1, 2006

 

U.S BANK NATIONAL ASSOCIATION,

as Trustee

 

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page
	ARTICLE I
	 	 	 	 
	 
	 	 	 	 
	DEFINITIONS AND INCORPORATION BY REFERENCE
	 	 	 	 
	 
	 	 	 	 
	Section 1.01. Definitions
	 	 	1	 
	Section 1.02. Other Definitions
	 	 	27	 
	Section 1.03. Incorporation by Reference of Trust Indenture Act
	 	 	28	 
	Section 1.04. Rules of Construction
	 	 	29	 
	 
	 	 	 	 
	ARTICLE II
	 	 	 	 
	 
	 	 	 	 
	THE SECURITIES
	 	 	 	 
	 
	 	 	 	 
	Section 2.01. Amount of Securities; Issuable in Series
	 	 	29	 
	Section 2.02. Form and Dating
	 	 	30	 
	Section 2.03. Execution and Authentication
	 	 	31	 
	Section 2.04. Registrar and Paying Agent
	 	 	32	 
	Section 2.05. Paying Agent to Hold Money in Trust
	 	 	32	 
	Section 2.06. Holder Lists
	 	 	32	 
	Section 2.07. Transfer and Exchange
	 	 	33	 
	Section 2.08. Replacement Securities
	 	 	33	 
	Section 2.09. Outstanding Securities
	 	 	34	 
	Section 2.10. Temporary Securities
	 	 	34	 
	Section 2.11. Cancellation
	 	 	35	 
	Section 2.12. Defaulted Interest
	 	 	35	 
	Section 2.13. CUSIP Numbers, ISINs, etc
	 	 	35	 
	 
	 	 	 	 
	ARTICLE III
	 	 	 	 
	 
	 	 	 	 
	REDEMPTION
	 	 	 	 
	 
	 	 	 	 
	Section 3.01. Redemption
	 	 	35	 
	Section 3.02. Applicability of Article
	 	 	35	 
	Section 3.03. Notices to Trustee
	 	 	35	 
	Section 3.04. Selection of Securities to Be Redeemed
	 	 	36	 
	Section 3.05. Notice of Optional Redemption
	 	 	36	 
	Section 3.06. Effect of Notice of Redemption
	 	 	37	 
	Section 3.07. Deposit of Redemption Price
	 	 	37	 
	Section 3.08. Securities Redeemed in Part
	 	 	37	 

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	 	 	Page
	ARTICLE IV
	 	 	 	 
	 
	 	 	 	 
	COVENANTS
	 	 	 	 
	 
	 	 	 	 
	Section 4.01. Payment of Securities
	 	 	37	 
	Section 4.02. SEC Reports
	 	 	38	 
	Section 4.03. Limitation on Indebtedness
	 	 	38	 
	Section 4.04. Limitation on Restricted Payments
	 	 	41	 
	Section 4.05. Limitation on Restrictions on Distributions from Restricted Subsidiaries
	 	 	44	 
	Section 4.06. Limitation on Sales of Assets and Subsidiary Stock
	 	 	46	 
	Section 4.07. Limitation on Affiliate Transactions
	 	 	49	 
	Section 4.08. Change of Control
	 	 	52	 
	Section 4.09. Limitation on Liens
	 	 	53	 
	Section 4.10. Future Guarantors
	 	 	53	 
	Section 4.11. Compliance Certificate
	 	 	53	 
	Section 4.12. Further Instruments and Acts
	 	 	53	 
	 
	 	 	 	 
	ARTICLE V
	 	 	 	 
	 
	 	 	 	 
	MERGER, CONSOLIDATION OR SALE OF ALL OR SUBSTANTIALLY ALL ASSETS
	 	 	 	 
	 
	 	 	 	 
	Section 5.01. Merger and Consolidation 
	 	 	53	 
	 
	 	 	 	 
	ARTICLE VI
	 	 	 	 
	 
	 	 	 	 
	DEFAULTS AND REMEDIES
	 	 	 	 
	 
	 	 	 	 
	Section 6.01. Events of Default
	 	 	55	 
	Section 6.02. Acceleration
	 	 	57	 
	Section 6.03. Other Remedies
	 	 	58	 
	Section 6.04. Waiver of Past Defaults
	 	 	58	 
	Section 6.05. Control by Majority
	 	 	58	 
	Section 6.06. Limitation on Suits
	 	 	58	 
	Section 6.07. Rights of the Holders to Receive Payment
	 	 	59	 
	Section 6.08. Collection Suit by Trustee
	 	 	59	 
	Section 6.09. Trustee May File Proofs of Claim
	 	 	59	 
	Section 6.10. Priorities
	 	 	59	 
	Section 6.11. Undertaking for Costs
	 	 	60	 
	Section 6.12. Waiver of Stay or Extension Laws
	 	 	60	 
	 
	 	 	 	 
	ARTICLE VII
	 	 	 	 
	 
	 	 	 	 
	TRUSTEE
	 	 	 	 
	 
	 	 	 	 
	Section 7.01. Duties of Trustee
	 	 	60	 
	Section 7.02. Rights of Trustee
	 	 	61	 

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	 	 	Page
	Section 7.03. Individual Rights of Trustee
	 	 	62	 
	Section 7.04. Trustee’s Disclaimer
	 	 	62	 
	Section 7.05. Notice of Defaults
	 	 	63	 
	Section 7.06. Reports by Trustee to the Holders
	 	 	63	 
	Section 7.07. Compensation and Indemnity
	 	 	63	 
	Section 7.08. Replacement of Trustee
	 	 	64	 
	Section 7.09. Successor Trustee by Merger
	 	 	65	 
	Section 7.10. Eligibility; Disqualification
	 	 	65	 
	Section 7.11. Preferential Collection of Claims Against Company
	 	 	65	 
	 
	 	 	 	 
	ARTICLE VIII
	 	 	 	 
	 
	 	 	 	 
	DISCHARGE OF INDENTURE; DEFEASANCE
	 	 	 	 
	 
	 	 	 	 
	Section 8.01. Discharge of Liability on Securities; Defeasance
	 	 	65	 
	Section 8.02. Conditions to Defeasance
	 	 	67	 
	Section 8.03. Application of Trust Money
	 	 	68	 
	Section 8.04. Repayment to the Company
	 	 	68	 
	Section 8.05. Indemnity for Government Obligations
	 	 	68	 
	Section 8.06. Reinstatement
	 	 	68	 
	 
	 	 	 	 
	ARTICLE IX
	 	 	 	 
	 
	 	 	 	 
	AMENDMENTS AND WAIVERS
	 	 	 	 
	 
	 	 	 	 
	Section 9.01. Without Consent of the Holders
	 	 	69	 
	Section 9.02. With Consent of the Holders
	 	 	70	 
	Section 9.03. Compliance with Trust Indenture Act
	 	 	70	 
	Section 9.04. Revocation and Effect of Consents and Waivers
	 	 	71	 
	Section 9.05. Notation on or Exchange of Securities
	 	 	71	 
	Section 9.06. Trustee to Sign Amendments
	 	 	71	 
	Section 9.07. Payment for Consent
	 	 	71	 
	 
	 	 	 	 
	ARTICLE X
	 	 	 	 
	 
	 	 	 	 
	GUARANTEES
	 	 	 	 
	 
	 	 	 	 
	Section 10.01. Guarantees
	 	 	72	 
	Section 10.02. Limitation on Liability
	 	 	74	 
	Section 10.03. Successors and Assigns
	 	 	75	 
	Section 10.04. No Waiver
	 	 	75	 
	Section 10.05. Modification
	 	 	75	 
	Section 10.06. Execution of Supplemental Indenture for Future Guarantors
	 	 	75	 

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	 	 	Page
	ARTICLE XI
	 	 	 	 
	 
	 	 	 	 
	MISCELLANEOUS
	 	 	 	 
	 
	 	 	 	 
	Section 11.01. Trust Indenture Act Controls
	 	 	75	 
	Section 11.02. Notices
	 	 	76	 
	Section 11.03. Communication by the Holders with Other Holders
	 	 	76	 
	Section 11.04. Certificate and Opinion as to Conditions Precedent
	 	 	76	 
	Section 11.05. Statements Required in Certificate or Opinion
	 	 	77	 
	Section 11.06. When Securities Disregarded
	 	 	77	 
	Section 11.07. Rules by Trustee, Paying Agent and Registrar
	 	 	77	 
	Section 11.08. Legal Holidays
	 	 	77	 
	Section 11.09. GOVERNING LAW
	 	 	77	 
	Section 11.10. No Recourse Against Others
	 	 	77	 
	Section 11.11. Successors
	 	 	78	 
	Section 11.12. Multiple Originals
	 	 	78	 
	Section 11.13. Table of Contents; Headings
	 	 	78	 
	Section 11.14. Indenture Controls
	 	 	78	 
	Section 11.15. Severability
	 	 	78	 

Appendix A – Rule 144A/Regulation S/IAI Appendix

Exhibit 1 – Form of Initial Security

Exhibit A – Form of Exchange Security or Private Exchange Security

Exhibit 2 – Form of Letter of Representation

Appendix B – Form of Supplemental Indenture for Future Guarantors

iv

 

CROSS-REFERENCE TABLE

	 	 	 	 	 
	TIA	 	 	 	Indenture
	Section	 	 	 	Section
	310
	 	(a)(1)	 	7.10
	 
	 	(a)(2)	 	7.10
	 
	 	(a)(3)	 	N.A.
	 
	 	(a)(4)	 	N.A.
	 
	 	(b)	 	7.08; 7.10
	 
	 	(c)	 	N.A.
	311
	 	(a)	 	7.11
	 
	 	(b)	 	7.11
	 
	 	(c)	 	N.A.
	312
	 	(a)	 	2.06
	 
	 	(b)	 	11.03
	 
	 	(c)	 	11.03
	313
	 	(a)	 	7.06
	 
	 	(b)(1)	 	N.A.
	 
	 	(b)(2)	 	7.06
	 
	 	(c)	 	11.02
	 
	 	(d)	 	7.06
	314
	 	(a)	 	4.02; 4.08;11.02
	 
	 	(b)	 	N.A.
	 
	 	(c)(1)	 	11.04
	 
	 	(c)(2)	 	11.04
	 
	 	(c)(3)	 	N.A.
	 
	 	(d)	 	N.A.
	 
	 	(e)	 	11.05
	 
	 	(f)	 	4.08
	315
	 	(a)	 	7.01
	 
	 	(b)	 	7.05; 11.02
	 
	 	(c)	 	7.01
	 
	 	(d)	 	7.01
	 
	 	(e) 	 	6.11
	316
	 	(a) (last sentence)	 	11.06
	 
	 	(a)(1)(A)	 	6.05
	 
	 	(a)(1)(B)	 	6.04
	 
	 	(a)(2)	 	N.A.
	 
	 	(b)	 	6.07
	317
	 	(a)(1)	 	6.08
	 
	 	(a)(2)	 	6.09
	 
	 	(b)	 	2.05
	318
	 	(a)	 	11.01

N.A. Means Not Applicable.

v

 

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

vi

 

     INDENTURE dated as of November 1, 2006, among Buffets, Inc., a
Minnesota corporation (the “Company”), Buffets Holdings, Inc, a
Delaware corporation, the Subsidiary Guarantors (as defined herein) and U.S.
Bank National Association, 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 Securities issued under this Indenture.

ARTICLE I

Definitions and Incorporation by Reference

          SECTION 1.01. Definitions.

          “Additional Assets” means:

	 	(1)	 	any property, plant or equipment useful in a Related Business;
	 
	 	(2)	 	the Capital Stock of a Person that becomes a Restricted Subsidiary as a result of the
acquisition of such Capital Stock by the Company or another Restricted Subsidiary; or
	 
	 	(3)	 	Capital Stock constituting a minority interest in any Person that at such time is a
Restricted Subsidiary;

provided, however, that any such Restricted Subsidiary described in clause (2) or
(3) above is primarily engaged in a Related Business.

          “Additional Securities” means any 121/2% Senior Notes due 2014 issued after the Issue Date
pursuant to Article II and in compliance with Section 4.03.

          “Affiliate” of any specified Person means any other Person, directly or indirectly,
controlling or controlled by or under direct or indirect common control with such specified Person.
For the purposes of this definition, “control” when used with respect to any Person means the power
to direct the management and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms “controlling” and
“controlled” have meanings correlative to the foregoing. For purposes of Section 4.04, Section 4.06
and Section 4.07 only, if Caxton-Iseman Investments L.P., Caxton Associates LLC, Caxton-Iseman
Capital, Inc. and its Affiliates (as defined in the preceding sentence), taken together,
beneficially own Capital Stock representing 10% or more of the total voting power of the Voting
Stock (on a fully diluted basis) of the Company, they shall be deemed to be Affiliates.

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

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

 

 

	 	(2)	 	the excess, if any, of (a) the present value at such redemption date of (i) the
redemption price of such Security at November 1, 2010 (such redemption price being set
forth in paragraph 5 of such Security), plus (ii) all required interest payments due on
such Security through November 1, 2010 (excluding accrued but unpaid interest to the
redemption date), computed using a discount rate equal to the Treasury Rate, as of such
redemption date, plus 50 basis points; over (b) the principal amount of such
Security.

          “Asset Disposition” means any sale, lease, transfer or other disposition (or series of related
sales, leases, transfers or dispositions) by the Company or any Restricted Subsidiary, including
any disposition by means of a merger, consolidation or similar transaction (each referred to for
the purposes of this definition as a “disposition”), of:

	 	(1)	 	any shares of Capital Stock of a Restricted Subsidiary (other than directors’
qualifying shares or shares required by applicable law to be held by a Person other than
the Company or a Restricted Subsidiary);
	 
	 	(2)	 	all or substantially all the assets of any division or line of business of the Company
or any Restricted Subsidiary; or
	 
	 	(3)	 	any other assets of the Company or any Restricted Subsidiary outside of the ordinary
course of business of the Company or such Restricted Subsidiary;

other than, in the case of clauses (1), (2) and (3) above,

	 	(A)	 	a disposition by a Restricted Subsidiary to the Company or by the Company or a
Restricted Subsidiary to another Restricted Subsidiary;
	 
	 	(B)	 	for purposes of Section 4.06 only, (x) a disposition that constitutes a Restricted
Payment permitted by Section 4.04 or a Permitted Investment and (y) a disposition of all or
substantially all the assets of the Company in accordance with Section 5.01;
	 
	 	(C)	 	a disposition of assets with a fair market value of less than $2.5 million;
	 
	 	(D)	 	entering into Hedging Obligations;
	 
	 	(E)	 	the granting of a Lien permitted under this Indenture;
	 
	 	(F)	 	the disposition of cash or Temporary Cash Investments;
	 
	 	(G)	 	the disposition of inventory or obsolete, damaged or worn out equipment or assets in
the ordinary course of business;
	 
	 	(H)	 	the disposition of property or assets that is a surrender or waiver of contract rights
or the settlement, release or surrender of contract, tort or other claims of any kind; and
	 
	 	(I)	 	sales or grants of licenses or sublicenses to use the patents, trade secrets, know-how
and other intellectual property, and licenses, leases or subleases of other assets, of the

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	 	 	 	Company or any Restricted Subsidiary to the extent not materially interfering with the
business of the Company and the Restricted Subsidiaries.

                    “Average Life” means, as of the date of determination, with respect to any Indebtedness, the
quotient obtained by dividing:

	 	(1)	 	the sum of the products of the numbers of years from the date of determination to the
dates of each successive scheduled principal payment of or redemption or similar payment
with respect to such Indebtedness multiplied by the amount of such payment by
	 
	 	(2)	 	the sum of all such payments.

                    “Board of Directors” with respect to a Person means the Board of Directors of such Person or
any committee thereof duly authorized to act on behalf of such Board.

                    “Buffets Restaurants” means Buffets Restaurants Holdings, Inc., a Delaware corporation, and
its successors.

                    “Business Day” means each day which is not a Legal Holiday.

                    “Capital Lease Obligation” means an obligation that is required to be classified and accounted
for as a capital lease for financial reporting purposes in accordance with GAAP, and the amount of
Indebtedness represented by such obligation shall be the capitalized amount of such obligation
determined in accordance with GAAP; and the Stated Maturity thereof shall be the date of the last
payment of rent or any other amount due under such lease prior to the first date upon which such
lease may be terminated by the lessee without payment of a penalty.

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

                    “Change of Control” means:

	 	(1)	 	any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act),
other than one or more Permitted Holders, is or becomes the beneficial owner (as defined in
Rules 13d-3 and 13d-5 under the Exchange Act) directly or indirectly, of more than 50% of
the total voting power of the Voting Stock of the Company; provided,
however, that such event shall not be deemed to be a Change of Control so long as
one or more of the Permitted Holders has the right or ability by voting power, contract or
otherwise, to elect or designate for election a majority of the Board of Directors of the
Company;
	 
	 	(2)	 	individuals who on the Issue Date constituted the Board of Directors of the Company or,
so long as Parent owns a majority of the total voting power of the Voting Stock of the
Company, the Parent Board (together with any new directors whose election by such Board of
Directors of the Company or the Parent Board or whose nomination for

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	 	 	 	election by the shareholders of the Company or Parent, as the case may be, was approved
by a vote of a majority of the directors of the Company or of Parent, as the case may be,
then still in office who were either directors on the Issue Date or whose election or
nomination for election was previously so approved or whose election was approved by the
Permitted Holders) cease for any reason to constitute a majority of the Board of
Directors of the Company or the Parent Board then in office; or
	 
	 	(3)	 	the merger or consolidation of Parent or the Company with or into another Person or the
merger of another Person with or into Parent or the Company, or the sale of all or
substantially all the assets of Parent or the Company (determined on a consolidated basis)
to another Person (other than, in all such cases, a Person that is a Permitted Holder or is
controlled by the Permitted Holders or is a Wholly Owned Subsidiary of the Company), other
than a transaction following which (A) in the case of a merger or consolidation
transaction, holders of securities that represented 100% of the Voting Stock of Parent or
the Company immediately prior to such transaction (or other securities into which such
securities are converted as part of such merger or consolidation transaction) own directly
or indirectly at least a majority of the voting power of the Voting Stock of the surviving
Person in such merger or consolidation transaction immediately after such transaction and
(B) in the case of a sale of assets transaction, the transferee Person becomes the obligor
in respect of the Securities and a Subsidiary of the transferor of such assets;
provided, however, that (i) it shall not constitute a Change of Control
under this clause (3) if, after giving effect to such transaction, the Permitted Holders
beneficially own (as defined in clause (1) above) 35% or more of the total voting power of
the Voting Stock of the surviving Person in such transaction immediately after such
transaction and (ii) this clause (3) shall not apply to Parent if at the time of the
transaction, Parent owns less than a majority of the total voting power of the Voting Stock
of the Company.

For purposes of this definition, (i) a Person shall not be deemed to have beneficial ownership of
securities subject to a stock purchase agreement, merger agreement or similar agreement until the
consummation of the transactions contemplated by such agreement and (ii) any holding company whose
only significant asset is Capital Stock of Parent or the Company shall not itself be considered a
“Person” or “group” for purposes of clause (1) or (3) above.

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

          “Consolidated Coverage Ratio” as of any date of determination means the ratio of (x) the
aggregate amount of EBITDA for the period of the most recent four consecutive fiscal quarters for
which internal financial statements are available prior to the date of such determination to (y)
Consolidated Interest Expense for such four fiscal quarters; provided, however,
that:

	 	(1)	 	if the Company or any Restricted Subsidiary has Incurred any Indebtedness since the
beginning of such period that remains outstanding or if the transaction giving rise to the
need to calculate the Consolidated Coverage Ratio is an Incurrence of Indebtedness, or
both, EBITDA and Consolidated Interest Expense for such period shall be calculated after
giving effect on a pro forma basis to such Indebtedness as if

-4-

 

	 	 	 	such Indebtedness had been Incurred on the first day of such period (except that, in
making such computation, the amount of Indebtedness under any revolving credit facility
outstanding on the date of such calculation shall be computed based on (A) the average
daily balance of such Indebtedness during such four fiscal quarters or such shorter
period when such facility was outstanding or (B) if such facility was created after the
end of such four fiscal quarters, the average balance of such Indebtedness during the
period from the date of creation of such facility to the date of the computation);
	 
	 	(2)	 	if the Company or any Restricted Subsidiary has repaid, repurchased, defeased or
otherwise discharged any Indebtedness since the beginning of such period or if any
Indebtedness is to be repaid, repurchased, defeased or otherwise discharged (in each case
other than Indebtedness Incurred under any revolving credit facility unless such
Indebtedness has been permanently repaid and has not been replaced) on the date of the
transaction giving rise to the need to calculate the Consolidated Coverage Ratio, EBITDA
and Consolidated Interest Expense for such period shall be calculated on a pro forma basis
as if such discharge had occurred on the first day of such period and as if the Company or
such Restricted Subsidiary has not earned the interest income actually earned during such
period in respect of cash or Temporary Cash Investments used to repay, repurchase, defease
or otherwise discharge such Indebtedness;
	 
	 	(3)	 	if since the beginning of such period the Company or any Restricted Subsidiary shall
have made any Asset Disposition, EBITDA for such period shall be reduced by an amount equal
to EBITDA (if positive) directly attributable to the assets which are the subject of such
Asset Disposition for such period, or increased by an amount equal to EBITDA (if negative),
directly attributable thereto for such period and Consolidated Interest Expense for such
period shall be reduced by an amount equal to the Consolidated Interest Expense directly
attributable to any Indebtedness of the Company or any Restricted Subsidiary repaid,
repurchased, defeased or otherwise discharged with respect to the Company and its
continuing Restricted Subsidiaries in connection with such Asset Disposition for such
period (or, if the Capital Stock of any Restricted Subsidiary is sold, the Consolidated
Interest Expense for such period directly attributable to the Indebtedness of such
Restricted Subsidiary to the extent the Company and its continuing Restricted Subsidiaries
are no longer liable for such Indebtedness after such sale);
	 
	 	(4)	 	if since the beginning of such period the Company or any Restricted Subsidiary (by
merger or otherwise) shall have made an Investment in any Restricted Subsidiary (or any
person which becomes a Restricted Subsidiary) or an acquisition of assets, including any
acquisition of assets occurring in connection with a transaction requiring a calculation to
be made hereunder, EBITDA and Consolidated Interest Expense for such period shall be
calculated after giving pro forma effect thereto (including the Incurrence of any
Indebtedness) as if such Investment or acquisition occurred on the first day of such
period; and
	 
	 	(5)	 	if since the beginning of such period any Person (that subsequently became a Restricted
Subsidiary or was merged with or into the Company or any Restricted

-5-

 

	 	 	 	Subsidiary since the beginning of such period) shall have made any Asset Disposition, any
Investment or acquisition of assets that would have required an adjustment pursuant to
clause (3) or (4) above if made by the Company or a Restricted Subsidiary during such
period, EBITDA and Consolidated Interest Expense for such period shall
be calculated after giving pro
forma effect thereto as if such Asset Disposition, Investment or acquisition occurred on
the first day of such period.

For purposes of this definition, whenever pro forma effect is to be given to an acquisition of
assets, the amount of income or earnings relating thereto and the amount of Consolidated Interest
Expense associated with any Indebtedness Incurred in connection therewith, the pro forma
calculations shall be determined in good faith by a responsible financial or accounting Officer of
the Company (and may include any applicable Pro Forma Cost Savings, whether or not the acquisition
occurred in such period). If any Indebtedness bears a floating rate of interest and is being given
pro forma effect, the interest on such Indebtedness shall be calculated as if the rate in effect on
the date of determination had been the applicable rate for the entire period (taking into account
any Interest Rate Agreement applicable to such Indebtedness).

          “Consolidated Interest Expense” means, for any period, the total interest expense of the
Company and its consolidated Restricted Subsidiaries, plus, to the extent not included in
such total interest expense, and to the extent incurred by the Company or its Restricted
Subsidiaries, without duplication:

	 	(1)	 	interest expense attributable to capital leases;
	 
	 	(2)	 	amortization of debt discount and debt issuance cost;
	 
	 	(3)	 	capitalized interest;
	 
	 	(4)	 	non-cash interest expenses;
	 
	 	(5)	 	commissions, discounts and other fees and charges owed with respect to letters of
credit and bankers’ acceptance financing;
	 
	 	(6)	 	net payments pursuant to Hedging Obligations;
	 
	 	(7)	 	dividends paid in cash or Disqualified Stock in respect of all Preferred Stock of
Restricted Subsidiaries and Disqualified Stock of the Company held by Persons other than
the Company or a Wholly Owned Subsidiary;
	 
	 	(8)	 	interest incurred in connection with Investments in discontinued operations;
	 
	 	(9)	 	interest actually paid by the Company or a Restricted Subsidiary under a Guarantee of
Indebtedness of any other Person; and
	 
	 	(10)	 	the cash contributions to any employee stock ownership plan or similar trust to the
extent such contributions are used by such plan or trust to pay interest or fees to any
Person (other than Buffets Restaurants, the Parent or the Company) in connection with
Indebtedness Incurred by such plan or trust;

-6-

 

less, to the extent included in such total interest expense, (A) the amortization during such
period of capitalized financing or debt issuance costs associated with the Transactions and (B) the
amortization during such period of other capitalized financing or debt issuance costs. Consolidated
Interest Expense shall be calculated excluding unrealized gains or losses with respect to Hedging
Obligations and any dividends or accretion or liquidation preference on any Capital Stock of the
Company that is not Disqualified Stock.

          “Consolidated Net Income” means, for any period, the net income of the Company and its
consolidated Subsidiaries; provided, however, that there shall not be included in
such Consolidated Net Income:

	 	(1)	 	any net income of any Person (other than the Company) if such Person is not a
Restricted Subsidiary, except that:

	 	(A)	 	subject to the exclusion contained in clause (4) below, the Company’s
equity in the net income of any such Person for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash actually distributed by
such Person during such period to the Company or a Restricted Subsidiary as a
dividend or other distribution (subject, in the case of a dividend or other
distribution paid to a Restricted Subsidiary, to the limitations contained in clause
(3) below); and
	 
	 	(B)	 	the Company’s equity in a net loss of any such Person for such period shall
be included in determining such Consolidated Net Income but only to the extent the
Company or a Restricted Subsidiary funded such net loss with cash and such funding
did not constitute a Restricted Payment that reduced the amount of permitted
Restricted Payments under Section 4.04;

	 	(2)	 	solely for purposes of determining the aggregate amount available for Restricted
Payments under Section 4.04(a)(3), any net income (or loss) of any Person acquired by the
Company or a Subsidiary in a pooling of interests transaction for any period prior to the
date of such acquisition;
	 
	 	(3)	 	any net income of any Restricted Subsidiary if such Restricted Subsidiary is subject to
restrictions, directly or indirectly, on the payment of dividends or the making of
distributions by such Restricted Subsidiary, directly or indirectly, to the Company, except
that:

	 	(A)	 	subject to the exclusion contained in clause (4) below, the Company’s
equity in the net income of any such Restricted Subsidiary for such period shall be
included in such Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Restricted Subsidiary during such period to the Company or
another Restricted Subsidiary as a dividend or other distribution (subject, in the
case of a dividend or other distribution paid to another Restricted Subsidiary, to
the limitation contained in this clause); and
	 
	 	(B)	 	the Company’s equity in a net loss of any such Restricted Subsidiary for
such period shall be included in determining such Consolidated Net Income;

-7-

 

	 	(4)	 	any gain or loss realized upon the sale or other disposition of any assets of the
Company, its consolidated Subsidiaries or any other Person (including pursuant to any
sale-and-leaseback arrangement) which is not sold or otherwise disposed of in the ordinary
course of business and any gain or loss realized upon the sale or other disposition of any
Capital Stock of any Person;
	 
	 	(5)	 	any extraordinary or nonrecurring gain (or extraordinary or nonrecurring loss),
together with any related provision for taxes on any such extraordinary or nonrecurring
gain (or the tax effect of any such extraordinary or nonrecurring loss), realized by the
Company or any Restricted Subsidiary during such period;
	 
	 	(6)	 	to the extent included in total interest expense, any amortization or write-offs of
debt issuance costs and prepayment penalties realized during such period to the extent
attributable to the Indebtedness being Refinanced in connection with the Transactions;
	 
	 	(7)	 	non-cash compensation charges or other non-cash expenses or charges arising from the
grant of or issuance or repricing of stock, stock options or other equity-based awards or
any amendment, modification, substitution or change of any such stock, stock options or
other equity-based awards;
	 
	 	(8)	 	any non-cash goodwill impairment charges subsequent to the Issue Date;
	 
	 	(9)	 	gains and losses realized upon the repayment or Refinancing of any Indebtedness of the
Company or any Restricted Subsidiary;
	 
	 	(10)	 	gains and losses due solely to fluctuations in currency values and the related tax
effects;
	 
	 	(11)	 	unrealized gains and losses with respect to Hedging Obligations;
	 
	 	(12)	 	the impact of any dividends or accretion of liquidation preference on any Capital Stock
of the Company that is not Disqualified Stock;
	 
	 	(13)	 	any amortization or write-offs of debt issuance or deferred financing costs and
premiums and prepayment penalties, in each case, to the extent attributable to the
Indebtedness being Refinanced or Incurred in connection with the Transactions;
	 
	 	(14)	 	so long as the Company is part of a consolidated group for tax purposes with the
Parent, Buffets Restaurants or another parent company, the excess (if any) of (a) the
provision for income taxes of the Company and its consolidated Subsidiaries over (b) the
sum of (x) the aggregate payments to the Parent or Buffets Restaurants (or any other parent
company) made pursuant to Section 4.04(b)(5) and (y) the amount of any income taxes that
the Company or its Subsidiaries paid directly to a taxing authority;
	 
	 	(15)	 	losses, expenses and charges incurred in connection with restructuring within the
Company and/or one or more Restricted Subsidiaries, including in connection with
integration of acquired businesses or Persons, disposition of one or more Subsidiaries or
businesses, exiting of one or more lines of businesses and relocation or

-8-

 

	 	 	 	consolidation of facilities, including severance, lease termination and other
non-ordinary-course, non-operating costs and expenses in connection therewith; and
	 
	 	(16)	 	the cumulative effect of a change in accounting principles.

Notwithstanding the foregoing, for the purposes of Section 4.04 only, there shall be excluded from
Consolidated Net Income any repurchases, repayments or redemptions of Investments, proceeds
realized on the sale of Investments or return of capital to the Company or a Restricted Subsidiary
to the extent such repurchases, repayments, redemptions, proceeds or returns increase the amount of
Restricted Payments permitted under Section 4.04(a)(3)(D).

          “Credit Agreement” means the Credit Agreement dated as of the Issue Date by and among, the
Company, the guarantors referred to therein and the lenders referred to therein, with Credit Suisse
as administrative agent and collateral agent, together with the related documents thereto
(including the term loans, revolving loans and letter of credit facility thereunder, any guarantees
and security documents), as amended, extended, renewed, replaced, restated, supplemented or
otherwise modified (in whole or in part, and without limitation as to amount, terms, conditions,
covenants and other provisions) from time to time, and any agreement (and related document or
instrument) governing Indebtedness incurred to Refinance, in whole or in part, the borrowings and
commitments then outstanding or permitted to be outstanding under such Credit Agreement or a
successor Credit Agreement, whether by the same or any other lender or group of lenders or
investors.

          “Currency Agreement” means in respect of a Person any foreign exchange contract, currency swap
agreement or other similar agreement with respect to currency values.

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

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

	 	(1)	 	matures or is mandatorily redeemable (other than redeemable only for Capital Stock of
such Person which is not itself Disqualified Stock) pursuant to a sinking fund obligation
or otherwise;
	 
	 	(2)	 	is convertible or exchangeable at the option of the holder for Indebtedness or
Disqualified Stock; or
	 
	 	(3)	 	is mandatorily redeemable or must be purchased upon the occurrence of certain events or
otherwise, in whole or in part;

in each case on or prior to the first anniversary of the Stated Maturity of the Securities;
provided, however, that any Capital Stock that would not constitute Disqualified
Stock but for provisions thereof giving holders thereof the right to require such Person to
purchase or redeem such Capital Stock upon the occurrence of an “asset sale” or “change of control”
occurring prior to the first anniversary of the Stated Maturity of the Securities shall not
constitute Disqualified Stock if:

-9-

 

	 	(1)	 	the “asset sale” or “change of control” provisions applicable to such Capital Stock are
not more favorable to the holders of such Capital Stock than the terms applicable to the
Securities and contained in Section 4.06 or Section 4.08; and
	 
	 	(2)	 	any such requirement only becomes operative after compliance with such terms applicable
to the Securities, including the purchase of any Securities tendered pursuant thereto.

The amount of any Disqualified Stock that does not have a fixed redemption, repayment or repurchase
price will be calculated in accordance with the terms of such Disqualified Stock as if such
Disqualified Stock were redeemed, repaid or repurchased on any date on which the amount of such
Disqualified Stock is to be determined pursuant to this Indenture; provided,
however, that if such Disqualified Stock could not be required to be redeemed, repaid or
repurchased at the time of such determination, the redemption, repayment or repurchase price will
be the book value of such Disqualified Stock as reflected in the most recent financial statements
of such Person.

          “EBITDA” for any period means the sum of Consolidated Net Income, plus the following
to the extent deducted in calculating such Consolidated Net Income:

	 	(1)	 	all income tax expense of the Company and its consolidated Restricted Subsidiaries;
	 
	 	(2)	 	Consolidated Interest Expense;
	 
	 	(3)	 	depreciation and amortization expense of the Company and its consolidated Restricted
Subsidiaries (excluding amortization expense attributable to a prepaid operating activity
item that was paid in cash in a prior period);
	 
	 	(4)	 	all other non-cash charges of the Company and its consolidated Restricted Subsidiaries
(including, deferred rental expense, but excluding any such non-cash charge to the extent
that it represents an accrual of or reserve for cash expenditures in any future period);
and
	 
	 	(5)	 	any payment of fees to Caxton-Iseman Capital, Inc. or its affiliates in accordance with
Section 4.07(b)(6)

in each case for such period. Notwithstanding the foregoing, the provision for taxes based on the
income or profits of, and the depreciation and amortization and non-cash charges of, a Restricted
Subsidiary shall be added to Consolidated Net Income to compute EBITDA only to the extent (and in
the same proportion) that the net income of such Restricted Subsidiary was included in calculating
Consolidated Net Income and only if a corresponding amount would be permitted at the date of
determination to be dividended to the Company by such Restricted Subsidiary without prior approval
(that has not been obtained), pursuant to the terms of its charter and all agreements, instruments,
judgments, decrees, orders, statutes, rules and governmental regulations applicable to such
Restricted Subsidiary or its stockholders.

          “Equity Offering” means a primary offering of common stock of Parent, the Company or Buffets
Restaurants.

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          “Exchange Act” means the Securities Exchange Act of 1934, as amended.

          “Exchange Securities” means the debt securities of the Company issued pursuant to this
Indenture in exchange for, and in an aggregate principal amount equal to the Securities in
compliance with the terms of a Registration Rights Agreement.

          “Existing Notes” means the outstanding 11-1/4% Senior Subordinated Notes due 2010 of the
Company outstanding on the Issue Date.

          “GAAP” means generally accepted accounting principles in the United States of America as in
effect as of the Issue Date, including those set forth in:

	 	(1)	 	the opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants;
	 
	 	(2)	 	statements and pronouncements of the Financial Accounting Standards Board; and
	 
	 	(3)	 	such other statements by such other entity as approved by a significant segment of the
accounting profession.

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

	 	(1)	 	to purchase or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness of such Person (whether arising by virtue of partnership arrangements, or by
agreements to keep-well, to purchase assets, goods, securities or services, to take-or-pay
or to maintain financial statement conditions or otherwise); or
	 
	 	(2)	 	entered into for the purpose of assuring in any other manner the obligee of such
Indebtedness of the payment thereof or to protect such obligee against loss in respect
thereof (in whole or in part);

provided, however, that the term “Guarantee” shall not include endorsements for
collection or deposit in the ordinary course of business. The term “Guarantee” used as a verb has
a corresponding meaning.

          “Guarantor” means Parent and each Subsidiary Guarantor, as applicable, that guarantees the
Securities pursuant to the terms of this Indenture.

          “Guaranty” means the Parent Guaranty and each Subsidiary Guaranty, as applicable.

          “Guaranty Agreement” means a supplemental indenture, in a form reasonably satisfactory to the
Trustee, pursuant to which a Subsidiary Guarantor or a successor to Parent guarantees the Company’s
obligations with respect to the Securities on the terms provided for in this Indenture.

-11-

 

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

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

          “Incur” means issue, assume, Guarantee, incur or otherwise become liable for;
provided, however, that any Indebtedness or Capital Stock of a Person existing at
the time such Person becomes a Restricted Subsidiary (whether by merger, consolidation, acquisition
or otherwise) shall be deemed to be Incurred by such Person at the time it becomes a Restricted
Subsidiary. The term “Incurrence” when used as a noun shall have a correlative meaning. Solely for
purposes of determining compliance with Section 4.03, (1) amortization of debt discount or the
accretion of principal with respect to a non-interest bearing or other discount security and (2)
the payment of regularly scheduled interest in the form of additional Indebtedness of the same
instrument or the payment or accretion of regularly scheduled dividends on Capital Stock in the
form of additional Capital Stock or liquidation preference of the same class and with the same
terms shall not be deemed to be the Incurrence of Indebtedness.

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

	 	(1)	 	the principal in respect of (A) indebtedness of such Person for money borrowed and (B)
indebtedness evidenced by notes, debentures, bonds or other similar instruments for the
payment of which such Person is responsible or liable, including, in each case, any premium
on such indebtedness to the extent such premium has become due and payable;
	 
	 	(2)	 	all Capital Lease Obligations of such Person;
	 
	 	(3)	 	all obligations of such Person issued or assumed as the deferred purchase price of
property, all conditional sale obligations of such Person and all obligations of such
Person under any title retention agreement (but excluding trade accounts payable arising in
the ordinary course of business);
	 
	 	(4)	 	all obligations of such Person for the reimbursement of any obligor on any letter of
credit, banker’s acceptance or similar credit transaction (other than obligations with
respect to letters of credit securing obligations (other than obligations described in
clauses (1) through (3) above) entered into in the ordinary course of business of such
Person to the extent such letters of credit are not drawn upon or, if and to the extent
drawn upon, such drawing is reimbursed no later than the tenth Business Day following
payment on the letter of credit);
	 
	 	(5)	 	the amount of all obligations of such Person with respect to the redemption, repayment
or other repurchase of any Disqualified Stock of such Person or, with respect to any
Preferred Stock of any Restricted Subsidiary of such Person, the principal amount of such
Preferred Stock to be determined in accordance with this Indenture (but excluding, in each
case, any accrued dividends);

-12-

 

	 	(6)	 	all obligations of the type referred to in clauses (1) through (5) of other Persons and
all dividends of other Persons for the payment of which, in either case, such Person is
responsible or liable, directly or indirectly, as obligor, guarantor or otherwise,
including by means of any Guarantee;
	 
	 	(7)	 	all obligations of the type referred to in clauses (1) through (6) of other Persons
secured by any Lien on any property or asset of such Person (whether or not such obligation
is assumed by such Person), the amount of such obligation being deemed to be the lesser of
the value of such property or assets and the amount of the obligation so secured; and
	 
	 	(8)	 	to the extent not otherwise included in this definition, Hedging Obligations of such
Person.

Notwithstanding the foregoing, any obligations under any Sale-Leaseback Transaction (including
pursuant to the Ryan’s Sale-Leaseback Transaction) in existence on the Issue Date shall not be
Indebtedness. In addition, in connection with the purchase by the Company or any Restricted
Subsidiary of any business, the term “Indebtedness” will exclude post-closing payment adjustments
to which the seller may become entitled to the extent such payment is determined by a final closing
balance sheet or such payment depends on the performance of such business after the closing;
provided, however, that, at the time of closing, the amount of any such payment is
not determinable and, to the extent such payment thereafter becomes fixed and determined, the
amount is paid within 30 days thereafter.

          The amount of Indebtedness of any Person at any date shall be the outstanding balance at such
date of all unconditional obligations as described above and the maximum liability, upon the
occurrence of the contingency giving rise to the obligation, of any contingent obligations at such
date; provided, however, that in the case of Indebtedness sold at a discount, the
amount of such Indebtedness at any time will be the accreted value thereof at such time.
Notwithstanding the foregoing, Indebtedness shall not include any liability for Federal, state,
local or other taxes owed or owing to any governmental entity or obligations of such Person with
respect to performance and surety bonds and completion guarantees entered into in the ordinary
course of business.

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

          “Independent Qualified Party” means an investment banking firm, accounting firm or appraisal
firm of national standing; provided, however, that such firm is not an Affiliate of
the Company.

          “Initial Securities” means the Securities issued by the Company on the Issue Date.

          “Interest Rate Agreement” means in respect of a Person any interest rate swap agreement,
interest rate cap agreement or other financial agreement or arrangement with respect to interest
rates.

          “Investment” in any Person means any direct or indirect advance, loan (other than advances to
customers in the ordinary course of business that are recorded as accounts receivable

-13-

 

on the balance sheet of the lender) or other extensions of credit (including by way of
Guarantee or similar arrangement) or capital contribution to (by means of any transfer of cash or
other property to others or any payment for property or services for the account or use of others),
or any purchase or acquisition of Capital Stock, Indebtedness or other similar instruments issued
by such Person. Except as otherwise provided for herein, the amount of an Investment shall be its
fair value at the time the Investment is made and without giving effect to subsequent changes in
value.

          For purposes of the definition of “Unrestricted Subsidiary”, the definition of “Restricted
Payment” and Section 4.04:

	 	(1)	 	“Investment” shall include the portion (proportionate to the Company’s equity interest
in such Subsidiary) of the fair market value of the net assets of any Subsidiary of the
Company at the time that such Subsidiary is designated an Unrestricted Subsidiary;
provided, however, that upon a redesignation of such Subsidiary as a
Restricted Subsidiary, the Company shall be deemed to continue to have a permanent
“Investment” in an Unrestricted Subsidiary equal to 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 of such Subsidiary at the time of such redesignation; and
	 
	 	(2)	 	any property transferred to or from an Unrestricted Subsidiary shall be valued at its
fair market value at the time of such transfer, in each case as determined in good faith by
the Board of Directors of the Company.

          “Issue Date” means the date on which the Securities are originally issued.

          “Legal Holiday” means a Saturday, a Sunday or a day on which banking institutions are not
required to be open in the State of New York.

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

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

	 	(1)	 	all legal, title and recording tax expenses, underwriting discounts, commissions,
investment bankers fees, and other fees and expenses incurred (including fees and expenses
of counsel, brokers, finders, consultants, placement agents, accountants and investment
bankers), and all Federal, state, provincial, foreign and local taxes required to be
accrued as a liability under GAAP, as a consequence of such Asset Disposition;

-14-

 

	 	(2)	 	all payments made on any Indebtedness which is secured by any assets subject to such
Asset Disposition, in accordance with the terms of any Lien upon or other security
agreement of any kind with respect to such assets, or which must by its terms, or in order
to obtain a necessary consent to such Asset Disposition, or by applicable law, be repaid
out of the proceeds from such Asset Disposition;
	 
	 	(3)	 	all distributions and other payments required to be made to minority interest holders
in Restricted Subsidiaries as a result of such Asset Disposition;
	 
	 	(4)	 	the deduction of appropriate amounts provided by the seller as a reserve, in accordance
with GAAP, against adjustment in the sale price of such property or assets or any
liabilities associated with the property or other assets disposed in such Asset Disposition
and retained by the Company or any Restricted Subsidiary after such Asset Disposition
including tax liabilities, pensions or other post-employment benefits liabilities and
liabilities related thereto;
	 
	 	(5)	 	payments of unassumed liabilities (not constituting Indebtedness) relating to assets
sold at the time of, or within 30 days after the date of, such Asset Disposition; and
	 
	 	(6)	 	any portion of the purchase price from an Asset Disposition placed in escrow, whether
as a reserve for adjustment of the purchase price, for satisfaction of indemnities in
respect of such Asset Disposition or otherwise in connection with that Asset Disposition;
provided, however, that upon the termination of such escrow, Net Available
Cash will be increased by any portion of funds in the escrow that are released to the
Company or any Restricted Subsidiary.

          “Net Cash Proceeds”, with respect to any issuance or sale of Capital Stock, means the cash
proceeds of such issuance or sale net of attorneys’ fees, accountants’ fees, underwriters’ or
placement agents’ fees, discounts or commissions and brokerage, consultant and other fees actually
incurred in connection with such issuance or sale and net of taxes paid or payable as a result
thereof.

          “Obligations” means with respect to any Indebtedness all obligations for principal, premium,
interest, penalties, fees, indemnifications, reimbursements, and other amounts payable pursuant to
the documentation governing such Indebtedness.

          “Offering Circular” means the Offering Circular dated October 19, 2006, with respect to the
Securities.

          “Officer” means the Chairman of the Board, Chief Executive Officer, President, Chief Financial
Officer, any Executive Vice President, Senior Vice President or Vice President, the Treasurer or
the Secretary of the Company.

          “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 set
forth in this Indenture.

-15-

 

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

          “Parent” means Buffets Holdings, Inc., a Delaware corporation, and its successors.

          “Parent Board” means the Board of Directors of the Parent or any committee thereof duly
authorized to act on behalf of such Board.

          “Parent Guaranty” means the Guarantee of the Securities by Parent pursuant to a Guaranty
Agreement.

          “Parent Notes” means the outstanding existing 13.875% Senior Discount Notes due 2010 of Parent
outstanding on the Issue Date.

          “Permitted Closing Date Payments” means (1) the payment of transaction fees and expenses by
Parent or Buffets Restaurants relating to the Transactions and (2) the payments necessary to enable
the Company and Parent to pay (A) the total consideration due and payable for all Existing Notes
and Parent Notes accepted by the Company and Parent with respect to the tender offers for all
outstanding Existing Notes and Parent Notes and (B) the purchase price or redemption price of any
Existing Notes and Parent Notes that are not tendered in such tender offers; provided,
however, that with respect to clause (B), such purchases or redemptions are completed prior
to December 13, 2006.

          “Permitted Equipment Lease Financings” means one or more Sale-Leaseback Transactions relating
to equipment and/or leasehold improvements.

          “Permitted Holders” means (i) Caxton-Iseman Investments L.P., Caxton-Iseman Capital, Inc.,
Caxton Associates, LLC, Sentinel Capital Partners, II, L.P., Frederick J. Iseman, Robert M.
Rosenberg, Steven M. Lefkowitz, Robert A, Ferris, Roe H. Hatlen and David S. Lobel and any other
Person who is a controlled Affiliate of any of the foregoing and any member of senior management of
the Company and (ii) any Related Party of any of the foregoing.

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

	 	(1)	 	the Company, a Restricted Subsidiary or a Person that will, upon the making of such
Investment, become a Restricted Subsidiary; provided, however, that the
primary business of such Restricted Subsidiary is a Related Business;
	 
	 	(2)	 	another Person if as a result of such Investment such other Person is merged or
consolidated with or into, or transfers or conveys all or substantially all its assets to,
the Company or a Restricted Subsidiary; provided, however, that such
Person’s primary business is a Related Business;
	 
	 	(3)	 	cash and Temporary Cash Investments;

-16-

 

	 	(4)	 	receivables owing to the Company or any Restricted Subsidiary if created or acquired in
the ordinary course of business and payable or dischargeable in accordance with customary
trade terms; provided, however, that such trade terms may include such
concessionary trade terms as the Company or any such Restricted Subsidiary deems reasonable
under the circumstances;
	 
	 	(5)	 	payroll, travel and similar advances to cover matters that are expected at the time of
such advances ultimately to be treated as expenses for accounting purposes and that are
made in the ordinary course of business;
	 
	 	(6)	 	loans or advances to employees made in the ordinary course of business of the Company
or such Restricted Subsidiary;
	 
	 	(7)	 	stock, obligations or securities received in settlement of debts created in the
ordinary course of business and owing to the Company or any Restricted Subsidiary or in
satisfaction of judgments;
	 
	 	(8)	 	any Person to the extent such Investment represents the non-cash portion of the
consideration received for an Asset Disposition as permitted pursuant to Section 4.06;
	 
	 	(9)	 	any Person where such Investment was acquired by the Company or any of its Restricted
Subsidiaries (a) in exchange for any other Investment or accounts receivable held by the
Company or any such Restricted Subsidiary in connection with or as a result of a
bankruptcy, workout, reorganization or recapitalization of the issuer of such other
Investment or accounts receivable or (b) as a result of a foreclosure by the Company or any
of its Restricted Subsidiaries with respect to any secured Investment or other transfer of
title with respect to any secured Investment in default;
	 
	 	(10)	 	any Person to the extent such Investments consist of prepaid expenses, negotiable
instruments held for collection and lease, utility and workers’ compensation, performance
and other similar deposits made in the ordinary course of business by the Company or any
Restricted Subsidiary;
	 
	 	(11)	 	any Person to the extent such Investment consists of the licensing or contribution of
intellectual property pursuant to joint marketing arrangements with other Persons;
	 
	 	(12)	 	any Person to the extent such Investment consists of loans and advances to suppliers,
licensees, franchisees or customers of the Company or any of the Restricted Subsidiaries
made in the ordinary course of business; provided, however, that the amount
of Investments made pursuant to this clause (12) do not exceed $5.0 million at any time
outstanding;
	 
	 	(13)	 	Persons to the extent such Investments are in existence on the Issue Date;
	 
	 	(14)	 	lease, utility and other similar deposits in the ordinary course of business;
	 
	 	(15)	 	any Person to the extent such Investment consists of Guarantees of Indebtedness to the
extent permitted under Section 4.03; provided, however, that any actual
payment made

-17-

 

	 	 	 	by the Company or any Restricted Subsidiary under such Guarantees of Indebtedness shall
not be a Permitted Investment under this clause (15);
	 
	 	(16)	 	additional Investments made after the Issue Date in an aggregate amount that, together
with all other Investments made pursuant to this clause (16) that are then outstanding, do
not exceed the greater of (a) $25 million and (b) 2.5% of Total Assets.

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

	 	(1)	 	pledges or deposits by such Person under workmen’s compensation laws, unemployment
insurance laws or similar legislation, or good faith deposits in connection with bids,
tenders, contracts (other than for the payment of Indebtedness) or leases to which such
Person is a party, or deposits to secure public or statutory obligations of such Person or
deposits of cash or U.S. government bonds to secure surety or appeal bonds to which such
Person is a party, or deposits as security for contested taxes or import duties or for the
payment of rent, in each case incurred in the ordinary course of business;
	 
	 	(2)	 	Liens imposed by law, such as carriers’, warehousemen’s and mechanics’ Liens, in each
case for sums not yet overdue for a period of more than 30 days or being contested in good
faith by appropriate proceedings or other Liens arising out of judgments or be proceeding
with an appeal or other proceedings for review if adequate reserves with respect thereto
are maintained on the books of such Person in accordance with GAAP;
	 
	 	(3)	 	Liens for taxes, assessments or other governmental charges not yet overdue for a period
of more than 30 days or payable or subject to penalties for nonpayment or which are being
contested in good faith by appropriate proceedings diligently conducted, if adequate
reserves with respect thereto are maintained on the books of such Person in accordance with
GAAP;
	 
	 	(4)	 	Liens in favor of issuers of performance and surety bonds or bid bonds or with respect
to other regulatory requirements or letters of credit issued pursuant to the request of and
for the account of such Person in the ordinary course of its business;
	 
	 	(5)	 	minor survey exceptions, minor encumbrances, easements or reservations of, or rights of
others for, licenses, rights-of-way, sewers, electric lines, telegraph and telephone lines
and other similar purposes, or zoning or other restrictions as to the use of real
properties or Liens incidental, to the conduct of the business of such Person or to the
ownership of its properties which were not incurred in connection with Indebtedness and
which do not in the aggregate materially adversely affect the value of said properties or
materially impair their use in the operation of the business of such Person;
	 
	 	(6)	 	Liens securing Indebtedness and other obligations permitted to be Incurred pursuant to
Section 4.03(b)(1), (b)(2), (b)(13) and (b)(14);
	 
	 	(7)	 	Liens existing on the Issue Date and any additional Liens under the terms of agreements
in effect on the Issue Date;

-18-

 

	 	(8)	 	Liens on property or shares of stock of a Person at the time such Person becomes a
Subsidiary, and Liens Incurred in connection with the acquisition of such Person;
provided, however, that such Liens may not extend to any other property
owned by the Company or any of its Restricted Subsidiaries and the Indebtedness (other than
any interest thereon) secured by the Lien may not be Incurred more than 180 days after the
time such other Person becomes a Subsidiary of such Person;
	 
	 	(9)	 	Liens on property at the time the Company or a Restricted Subsidiary acquired the
property, and Liens Incurred in connection with the acquisition of such property, including
any acquisition by means of a merger or consolidation with or into the Company or any of
its Restricted Subsidiaries; provided, however, that the Liens may not
extend to any other property owned by the Company or any of its Restricted Subsidiaries and
the Indebtedness (other than any interest thereon) secured by the Lien may not be Incurred
more than 180 days after the acquisition of the property subject to such Lien;
	 
	 	(10)	 	Liens securing Indebtedness or other obligations of a Restricted Subsidiary permitted
to be Incurred in accordance with Section 4.03;
	 
	 	(11)	 	Liens securing Hedging Obligations permitted to be Incurred under Section 4.03;
	 
	 	(12)	 	Liens on specific items of inventory of other goods and proceeds of any Person securing
such Person’s obligations in respect of bankers’ acceptances issued or created for the
account of such Person to facilitate the purchase, shipment or storage of such inventory or
other goods;
	 
	 	(13)	 	leases, subleases, licenses or sublicenses granted to others in the ordinary course of
business which do not materially interfere with the ordinary conduct of the business of the
Company or any of its Restricted Subsidiaries;
	 
	 	(14)	 	Liens arising from Uniform Commercial Code financing statement filings regarding
operating leases entered into by the Company and its Restricted Subsidiaries;
	 
	 	(15)	 	Liens in favor of the Company or any Subsidiary Guarantor;
	 
	 	(16)	 	Liens to secure any refinancing as a whole, or in part, of any Indebtedness secured by
any Lien referred to in the foregoing clauses (7), (8) and (9); provided,
however, that (a) such new Lien shall be limited to all or part of the same
property that secured the original Lien (plus improvements on such property), and (b) the
Indebtedness secured by such Lien at such time is not increased to any amount greater than
the sum of (i) the outstanding principal amount or, if greater, committed amount of the
Indebtedness described under clauses (7), (8) and (9) at the time the original Lien became
a Permitted Lien under this Indenture, and (ii) an amount necessary to pay accrued interest
on the Indebtedness being Refinanced and pay any fees and expenses, including any premium
and defeasance or discharge costs, related to such refinancing, refunding, extension,
renewal or replacement;

-19-

 

	 	(17)	 	deposits made in the ordinary course of business to secure liability to insurance
carriers;
	 
	 	(18)	 	Liens that are contractual rights of set-off (i) relating to the establishment of
depository relations with banks not given in connection with the issuance of Indebtedness,
(ii) relating to pooled deposit or sweep accounts of the Company or any of its Restricted
Subsidiaries to permit satisfaction of overdraft or similar obligations incurred in the
ordinary course of business of the Company and its Restricted Subsidiaries or (iii)
relating to purchase orders and other agreements entered into with customers of the Company
or any of its Restricted Subsidiaries in the ordinary course of business; and
	 
	 	(19)	 	Liens on Capital Stock or other securities or assets of any Unrestricted Subsidiary
that secure Indebtedness of such Unrestricted Subsidiary.

For purposes of this definition, the term “Indebtedness” shall be deemed to include interest on
such Indebtedness.

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

          “Preferred Stock”, as applied to the Capital Stock of any Person, means Capital Stock of any
class or classes (however designated) which is preferred as to the payment of dividends or
distributions, or as to the distribution of assets upon any voluntary or involuntary liquidation or
dissolution of such Person, over shares of Capital Stock of any other class of such Person.

          “principal” of a Security means the principal of the Security plus the premium, if any,
payable on the Security which is due or overdue or is to become due at the relevant time.

          “Pro Forma Cost Savings” means, with respect to any period, the reduction in costs or other
adjustments (including, solely in the case of clause (3)(i) below, an annualization of EBITDA), as
applicable, that are

	 	(1)	 	directly attributable to an asset acquisition and calculated on a basis that is
consistent with Regulation S-X under the Securities Act in effect and as applied as of the
Issue Date, or
	 
	 	(2)	 	implemented by the Company or the business that was the subject of any such asset
acquisition, in each case, within one year after the date of the asset acquisition (or, in
the case of the business that was the subject of any such acquisition, prior to the date of
the asset acquisition) and that are supportable and quantifiable by the underlying
accounting records of the Company or such business, or
	 
	 	(3)	 	in connection with any acquisition of restaurants or a Person engaged in a Related
Business, (i) the EBITDA reasonably estimated by the Company’s chief financial officer
associated with any such acquired restaurants that were operated for at least three months
but no longer than twelve months by the business that was the subject of

-20-

 

	 	 	 	any such acquisition and (ii) cost savings reasonably estimated by the Company’s chief
financial officer and reasonably expected by such chief financial officer to be
implemented within 12 months (and fully realized within 24 months) of the consummation of
such acquisition directly attributable to closing such acquired restaurants, the
headquarters, back office and support consolidation, including consolidation of
functions, reductions in employees and staff, marketing initiatives, elimination of
redundant costs and activities, economies of scale and shifting to best practices in
purchasing, in-house production or other functions, labor scheduling and changes to
benefits and integration of practices of the acquired business to those of the Company.

as if, in the case of each of clauses (1) (2) and (3), all such reductions in costs or other
adjustments had been effected as of the beginning of such period.

          Notwithstanding the foregoing, Pro Forma Cost Savings for the acquisition of Ryan’s on the
Issue Date shall not exceed (i) $13.925 million for any fiscal quarter ending on or prior to
September 20, 2007, (ii) $13.5 million for the fiscal quarter ending on December 12, 2007, (iii)
$5.1 million for the fiscal quarter ending on April 2, 2008 and (iv) $2.5 million for the fiscal
quarter ending on June 25, 2008.

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

          “Refinancing Indebtedness” means Indebtedness that Refinances any Indebtedness of the Company
or any Restricted Subsidiary existing on the Issue Date or Incurred in compliance with this
Indenture, including Indebtedness that Refinances Refinancing Indebtedness; provided,
however, that:

	 	(1)	 	such Refinancing Indebtedness has a Stated Maturity no earlier than the Stated Maturity
of the Indebtedness being Refinanced;
	 
	 	(2)	 	such Refinancing Indebtedness has an Average Life at the time such Refinancing
Indebtedness is Incurred that is equal to or greater than the Average Life of the
Indebtedness being Refinanced; and
	 
	 	(3)	 	such Refinancing Indebtedness has an aggregate principal amount (or if Incurred with
original issue discount, an aggregate issue price) that is equal to or less than the
aggregate principal amount (or if Incurred with original issue discount, the aggregate
accreted value) then outstanding or committed (plus (i) accrued interest on the
Indebtedness being Refinanced and (ii) fees and expenses, including any premium and
defeasance or discharge costs) under the Indebtedness being Refinanced;

provided further, however, that Refinancing Indebtedness shall not include (A)
Indebtedness of a Subsidiary that Refinances Indebtedness of the Company or (B) Indebtedness of the
Company or a Restricted Subsidiary that Refinances Indebtedness of an Unrestricted Subsidiary.

-21-

 

          “Registration Rights Agreement” means (i) the Registration Rights Agreement dated the Issue
Date, among the Company, the Guarantors and Credit Suisse Securities (USA) LLC, UBS Securities LLC,
Goldman Sachs & Co. and Piper Jaffray & Co. and (ii) any Registration Rights Agreement relating to
Additional Securities.

          “Related Business” means any business in which the Company was engaged on the Issue Date and
any business that in the good faith judgment of the Board of Directors of the Company is related,
ancillary or complementary thereto, arises therefrom or is necessary or desirable to facilitate
such business or any unrelated business to the extent it is not material in size compared with the
Company’s business as a whole.

          “Related Party” means (1) any controlling stockholder, controlling member, general partner,
majority owned Subsidiary, or spouse or immediate family member (in the case of an individual) of
any Permitted Holder or (2) any estate trust, corporation, partnership or other entity, the
beneficiaries, stockholders, partners, owners or Persons holding a controlling interest of which
consist solely of one or more Permitted Holders and/or such other Persons referred to in the
immediately preceding clause (1) or (3) any executor, administrator, trustee, manager, director or
other similar fiduciary of any Person referred to in the immediately preceding clause (2) acting
solely in such capacity.

          “Restricted Payment” with respect to any Person means:

	 	(1)	 	the declaration or payment of any dividends or any other distributions of any sort in
respect of its Capital Stock (including any payment in connection with any merger or
consolidation involving such Person) or similar payment to the direct or indirect holders
of its Capital Stock (other than dividends or distributions payable solely in its Capital
Stock (other than Disqualified Stock) and dividends or distributions payable solely 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)	 	the purchase, redemption or other acquisition or retirement for value of any Capital
Stock of the Company held by any Person or of any Capital Stock of a Restricted Subsidiary
held by any Affiliate of the Company (other than a Restricted Subsidiary), including the
exercise of any option to exchange any Capital Stock (other than into Capital Stock of the
Company that is not Disqualified Stock);
	 
	 	(3)	 	the purchase, repurchase, redemption, defeasance or other acquisition or retirement for
value, prior to scheduled maturity, scheduled repayment or scheduled sinking fund payment
of any Subordinated Obligations of such Person (other than the purchase, repurchase or
other acquisition of Subordinated Obligations purchased in anticipation of satisfying a
sinking fund obligation, principal installment or final maturity, in each case due within
one year of the date of such purchase, repurchase or other acquisition); or
	 
	 	(4)	 	the making of any Investment (other than a Permitted Investment) in any Person.

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          “Restricted Subsidiary” means any Subsidiary of the Company that is not an Unrestricted
Subsidiary.

          “Revolving Credit Facility” means the revolving credit facility and letter of credit facility
contained in the Credit Agreement and any other facilities or financing arrangements (including
commercial paper facilities, revolving credit loans, term loans, receivables financing letters of
credit, or any debt securities or other form of debt, convertible debt or exchangeable debt
financing) that Refinance or replace, in whole or in part, any such revolving credit facility,
letter of credit facility or financing arrangement.

          “Ryan’s” means Ryan’s Restaurant Group, Inc., a South Carolina Corporation.

          “Ryan’s Sale-Leaseback Transaction” means the Sale-Leaseback Transaction consummated on the
Issue Date pursuant to which the Company or one of its Subsidiaries will sell the land (or, in
certain cases, assign its interest in the ground leased properties pursuant to an assignment of its
underlying ground leases) and related improvements with respect to approximately 275 Ryan’s
restaurants and seven Buffets restaurants and simultaneously lease these properties back for gross
proceeds in the amount of approximately $566.8 million.

          “Sale-Leaseback Transaction” means an arrangement relating to property owned by the Company or
a Restricted Subsidiary whereby the Company or a Restricted Subsidiary transfers such property to a
Person and the Company or a Restricted Subsidiary leases it from such Person.

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

          “Secured Indebtedness” means any Indebtedness of the Company secured by a Lien.

          “Securities” means the 121/2% Senior Notes Due 2014 of the Company (including the Initial
Securities, and any Exchange Securities and Additional Securities), in the forms set forth in
Appendix A.

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

          “Senior Indebtedness” means with respect to any Person:

	 	(1)	 	Indebtedness of such Person, whether outstanding on the Issue Date or thereafter
Incurred; and
	 
	 	(2)	 	accrued and unpaid interest (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to such Person whether or not
post-filing interest is allowed in such proceeding) in respect of (A) indebtedness of such
Person for money borrowed and (B) indebtedness evidenced by notes, debentures, bonds or
other similar instruments for the payment of which such Person is responsible or liable

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unless, in the case of clauses (1) and (2), in the instrument creating or evidencing the same or
pursuant to which the same is outstanding, it is provided that such obligations are subordinate in
right of payment to the Securities or the Guaranty of such Person, as the case may be;
provided, however, that Senior Indebtedness shall not include:

	 	(1)	 	any obligation of such Person to any Subsidiary;
	 
	 	(2)	 	any liability for Federal, state, local or other taxes owed or owing by such Person;
	 
	 	(3)	 	any accounts payable or other liability to trade creditors arising in the ordinary
course of business (including guarantees thereof or instruments evidencing such
liabilities);
	 
	 	(4)	 	any Indebtedness of such Person (and any accrued and unpaid interest in respect
thereof) that is subordinate or junior in right of payment to any other Indebtedness or
other obligation of such Person; or
	 
	 	(5)	 	that portion of any Indebtedness that at the time of Incurrence is Incurred in
violation of this Indenture (but, as to any such obligation, no such violation shall be
deemed to exist for purposes of this clause (5) if the holders of such obligation or their
representative 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).

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

          “Stated Maturity” means, with respect to any security, the date specified in such security as
the fixed date on which the final payment of principal of such security is due and payable,
including pursuant to any mandatory redemption provision (but excluding any provision providing for
the repurchase of such security at the option of the holder thereof upon the happening of any
contingency unless such contingency has occurred).

          “Subordinated Obligation” means, with respect to a Person, any Indebtedness of such Person
(whether outstanding on the Issue Date or thereafter Incurred) which is subordinate or junior in
right of payment to the Securities or a Subsidiary Guaranty of such Person, as the case may be,
pursuant to a written agreement to that effect.

          “Subsidiary” means, with respect to any Person, any corporation, association, partnership or
other business entity of which more than 50% of the total voting power of shares of Voting Stock is
at the time owned or controlled, directly or indirectly, by:

	 	(1)	 	such Person;
	 
	 	(2)	 	such Person and one or more Subsidiaries of such Person; or

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	 	(3)	 	one or more Subsidiaries of such Person.

          “Subsidiary Guarantor” means HomeTown Buffet, Inc., OCB Restaurant Company, LLC, OCB
Purchasing Co., OCB Leasing Company, LLC, and Tahoe Joe’s, Inc. and each other Subsidiary of the
Company that executes this Indenture as a guarantor and each other Subsidiary of the Company that
thereafter guarantees the Securities pursuant to the terms of this Indenture.

          “Subsidiary Guaranty” means a Guarantee by a Subsidiary Guarantor of the Company’s obligations
with respect to the Securities.

          “TIA” means the Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa-77bbbb) as in effect on
the Issue Date.

          “Temporary Cash Investments” means any of the following:

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

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          “Term Loan Facility” means the term loan facility initially contained in the Credit Agreement
and any other facility or financing arrangement (including commercial paper facilities, revolving
credit loans, term loans, receivables financing, letters of credit, or any debt securities or other
form of debt, convertible debt or exchangeable debt financing) that Refinances or replaces, in
whole or in part, any such facility or financing arrangement.

          “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 consolidated balance sheet for the most
recently ended fiscal quarter prior to such date for which internal financial statements are
available.

          “Transactions” means the “Transactions” as defined in the Offering Circular.

          “Treasury Rate” means, as of any redemption date, the yield to maturity as of such redemption
date of United States Treasury securities with a constant maturity (as compiled 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 the 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 the redemption date to November 1, 2010; provided, however, that if the
period from the redemption date to such date, 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.

          “Trust Officer” means:

	 	(1)	 	any officer within the corporate trust department of the Trustee, including any vice
president, assistant vice president, assistant secretary, assistant treasurer, trust
officer or any other officer of the Trustee who customarily performs functions similar to
those performed by the Persons who at the time shall be such officers, respectively, or to
whom any corporate trust matter is referred because of such person’s knowledge of and
familiarity with the particular subject, and
	 
	 	(2)	 	who shall have direct responsibility for the administration of this Indenture.

          “Trustee” means the respective party named as such in this Indenture until a successor
replaces it and, thereafter, means the successor.

          “Uniform Commercial Code” means the New York Uniform Commercial Code as in effect from time to
time.

          “Unrestricted Subsidiary” means:

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

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The Board of Directors of the Company may designate any Subsidiary of the Company (including any
newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary unless such Subsidiary
or any of its Subsidiaries owns any Capital Stock or Indebtedness of, or holds any Lien on any
property of, the Company or any other Subsidiary of the Company that is not a Subsidiary of the
Subsidiary to be so designated; provided, however, that either (A) the Subsidiary
to be so designated has total assets of $1,000 or less or (B) if such Subsidiary has assets greater
than $1,000, such designation would be permitted under Section 4.04.

          The Board of Directors of the Company may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary; provided, however, that immediately after giving effect to
such designation (A) (i) the Company could Incur $1.00 of additional Indebtedness under Section
4.03(a) or (ii) the Consolidated Coverage Ratio for the Company and its Restricted Subsidiaries
would be greater than the Consolidated Coverage Ratio for the Company and its Restricted
Subsidiaries immediately before giving effect to such designation and (B) no Default shall have
occurred and be continuing. 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 resolution of the Board
of Directors of the Company giving effect to such designation and an Officers’ Certificate
certifying that such designation complied with the foregoing provisions.

          “U.S. Government Obligations” means direct obligations (or certificates representing an
ownership interest in such obligations) of the United States of America (including any agency or
instrumentality thereof) for the payment of which the full faith and credit of the United States of
America is pledged and which are not callable at the issuer’s option.

          “Voting Stock” of a Person means all classes of Capital Stock or other interests (including
partnership interests) of such Person then outstanding and normally entitled (without regard to the
occurrence of any contingency) to vote in the election of directors, managers or trustees thereof.

          “Wholly Owned Subsidiary” means a Restricted Subsidiary all the Capital Stock of which (other
than directors’ qualifying shares) is owned by the Company or one or more Wholly Owned
Subsidiaries.

          SECTION 1.02. Other Definitions.

	 	 	 
	 	 	Defined in
	Term	 	Section
	“Affiliate Transaction”
	 	4.07
	“Additional Interest”
	 	Appendix A
	“Bankruptcy Law”
	 	6.01
	“covenant defeasance option”
	 	8.01(b)
	“Custodian”
	 	6.01
	“Definitive Security”
	 	Appendix A
	“Depository”
	 	Appendix A
	“Event of Default”
	 	6.01

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	 	 	Defined in
	Term	 	Section
	“Global Security”
	 	Appendix A
	“Global Securities Legend”
	 	Appendix A
	“Guaranteed Obligations”
	 	10.01(a)
	“IAI”
	 	Appendix A
	“incorporated provision”
	 	11.01
	“Initial Lien”
	 	4.09
	“Initial Purchasers”
	 	Appendix A
	“legal defeasance option”
	 	8.01(b)
	“Securities Custodian”
	 	Appendix A
	“Notice of Default”
	 	6.01
	“Offer” .
	 	4.06(b)
	“Offer Amount”
	 	4.06(c)
	“Offer Period”
	 	4.06(c)
	“Paying Agent”
	 	2.04
	“protected purchaser”
	 	2.08
	“Purchase Agreement”
	 	Appendix A
	“Private Exchange”
	 	Appendix A
	“Private Exchange Security”
	 	Appendix A
	“QIB”
	 	Appendix A
	“Registration Default”
	 	Appendix A
	“Registered Exchange Offer”
	 	Appendix A
	“Registrar”
	 	2.04
	“Regulation S”
	 	Appendix A
	“Regulation S Global Security”
	 	Appendix A
	“Restricted Securities Legend”
	 	Appendix A
	“Rule 144A”
	 	Appendix A
	“Rule 144A Global Security”
	 	Appendix A
	“Shelf Registration Statement”
	 	Appendix A
	“Successor Company”
	 	5.01(a)
	“Successor Guarantor”
	 	5.01(c)
	“Transfer Restricted Securities”
	 	Appendix A

          SECTION 1.03. Incorporation by Reference of Trust Indenture Act. This Indenture
incorporates by reference certain provisions of the TIA. The following TIA terms have the
following meanings:

          “Commission” means the SEC.

          “indenture securities” means the Securities and the Guarantees.

          “indenture security holder” means a Holder.

          “indenture to be qualified” means this Indenture.

          “indenture trustee” or “institutional trustee” means the Trustee.

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          “obligor” on the indenture securities means the Company, the Guarantors and any other obligor
on the Securities.

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

          SECTION 1.04. Rules of Construction. Unless the context otherwise requires:

     (a) a term has the meaning assigned to it;

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

     (c) “or” is not exclusive;

     (d) “including” means including without limitation;

     (e) words in the singular include the plural and words in the plural include the
singular;

     (f) unsecured Indebtedness shall not be deemed to be subordinate or junior to Secured
Indebtedness merely by virtue of its nature as unsecured Indebtedness and secured
Indebtedness shall not be deemed to be subordinate or junior to any other secured
Indebtedness merely because it has a junior priority with respect to the same collateral;

     (g) the principal amount of any non-interest bearing or other discount security at any
date shall be the principal amount thereof that would be shown on a balance sheet of the
issuer dated such date prepared in accordance with GAAP;

     (h) unless otherwise specified herein, all accounting terms used herein shall be
interpreted, all accounting determinations hereunder shall be made, and all financial
statements required to be delivered hereunder shall be prepared in accordance with GAAP; and

     (i) whenever in this Indenture there is mentioned, in any context, principal, interest
or any other amount payable under or with respect to any Securities, such mention shall be
deemed to include mention of the payment of Additional Interest, to the extent that, in such
context, Additional Interest are, were, or would be payable in respect thereof.

ARTICLE II

The Securities

          SECTION 2.01. Amount of Securities; Issuable in Series. (a) The aggregate principal
amount of the Securities which may be authenticated and delivered under this Indenture

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on the Issue Date is $300,000,000. The Initial Securities, any Additional Securities and any
Exchange Securities will be treated as a single series of Securities for purposes of this
Indenture.

          The Company may from time to time after the Issue Date issue Additional Securities under this
Indenture in an unlimited principal amount, so long as (i) the Incurrence of the Indebtedness
represented by such Additional Securities is at such time permitted by Section 4.03 and (ii) such
Additional Securities are issued in compliance with the other applicable provisions of this
Indenture. Additional Securities shall have identical terms as the Initial Securities Issued on
the Issue Date, other than with respect to the date of issuance and issue price and as contemplated
by clause (2) below. With respect to any Additional Securities issued after the Issue Date (except
for Securities authenticated and delivered upon registration of transfer of, or in exchange for, or
in lieu of, other Securities pursuant to Sections 2.07, 2.08, 2.09, 2.10, 3.06, 4.06(c), 4.08(c) or
Appendix A), there shall be (a) established in or pursuant to a resolution of the Board of
Directors of the Company and (b) (i) set forth or determined in the manner provided in an Officers’
Certificate or (ii) established in one or more indentures supplemental hereto, prior to the
issuance of such Additional Securities:

     (1) the aggregate principal amount of such Additional Securities which may be
authenticated and delivered under this Indenture;

     (2) the issue price and issuance date of such Additional Securities,
including the date from which interest on such Additional Securities will accrue;

     (3) if applicable, that such Additional Securities shall be issuable in whole
or in part in the form of one or more Global Securities and, in such case, the respective
depositaries for such Global Securities, the form of any legend or legends which shall be
borne by such Global Securities in addition to or in lieu of those set forth in Appendix A
hereto and any circumstances in addition to or in lieu of those set forth in Appendix A in
which any such Global Security may be exchanged in whole or in part for Additional
Securities registered, or any transfer of such Global Security in whole or in part may be
registered, in the name or names of Persons other than the depositary for such Global
Security or a nominee thereof; and

     (4) if applicable, that such Additional Securities that are not Transfer
Restricted Securities shall not be issued in the form of Initial Securities as set forth in
Appendix A, but shall be issued in the form of Exchange Securities as set forth in Appendix
A.

          If any of the terms of any Additional Securities are established by action taken pursuant to a
resolution of the Board of Directors, a copy of an appropriate record of such action shall be
certified by the Secretary or any Assistant Secretary of the Company and delivered to the Trustee
at or prior to the delivery of the Officers’ Certificate or the indenture supplemental hereto
setting forth the terms of the Additional Securities.

          SECTION 2.02. Form and Dating. Provisions relating to the Securities are set forth in
Appendix A, which is hereby incorporated in and expressly made a part of this Indenture. The (i)
Initial Securities and the Trustee’s certificate of authentication and (ii) any Additional
Securities (if issued as Transfer Restricted Securities) and the Trustee’s certificate of

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	 	 	authentication shall each be substantially in the form set forth in Appendix A, which is
hereby incorporated in and expressly made a part of this Indenture. The (i) Exchange Securities
and the Trustee’s certificate of authentication and (ii) any additional Exchange Securities issued
other than as Transfer Restricted Securities and the Trustee’s certificate of authentication shall
each be substantially in the form set forth in Appendix A, which is hereby incorporated in and
expressly made a part of this Indenture. The Securities may have notations, legends or
endorsements required by law, stock exchange rule, agreements to which the Company or any Guarantor
is subject, if any, or usage (provided that any such notation, legend or endorsement is in
a form acceptable to the Company). Each Security shall be dated the date of its authentication.
The Securities shall be issuable only in registered form without interest coupons and only in
denominations of $2,000 and integral multiples of $1,000 in excess of $2,000.

          SECTION 2.03. Execution and Authentication. (a) The Trustee shall authenticate and
make available for delivery upon a written order of the Company signed by one Officer (i)
Securities for original issue on the date hereof in an aggregate principal amount of $300,000,000,
(ii) subject to the terms of this Indenture, Additional Securities in an aggregate principal amount
to be determined at the time of issuance and specified therein and (iii) the Exchange Securities
for issue in a Registered Exchange Offer or Private Exchange pursuant to a Registration Rights
Agreement for a like principal amount of Initial Securities and, if applicable, any Additional
Securities. Such order shall specify the amount of the Securities to be authenticated, the date on
which the original issue of Securities is to be authenticated and whether the Securities are to be
Initial Securities, Additional Securities or Exchange Securities. Notwithstanding anything to the
contrary in this Indenture or Appendix A, any issuance of Additional Securities after the Issue
Date shall be in a principal amount of at least $2,000 and any integral multiples of $1,000 in
excess of $2,000.

          (b) One Officer shall sign the Securities for the Company by manual signature.

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

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

          (e) The Trustee may appoint one or more authenticating agents reasonably acceptable to the
Company to authenticate the Securities. Any such appointment shall be evidenced by an instrument
signed by a Trust Officer, a copy of which shall be furnished to the Company. Unless limited by
the terms of such appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as any Registrar, Paying
Agent or agent for service of notices and demands.

          (f) The Trustee is hereby authorized to enter into a letter of representations with the
Depository in the form provided by the Company and to act in accordance with such letter.

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          SECTION 2.04. Registrar and Paying Agent. (a) The Company shall maintain (i) an
office or agency where Securities may be presented for registration of transfer or for exchange
(the “Registrar”), and (ii) an office or agency in the Borough of Manhattan, the City of
New York, the State of New York where Securities may be presented for payment (the “Paying
Agent”). The Registrar shall keep a register of the Securities and of their transfer and
exchange. The Company may have one or more co-registrars and one or more additional paying agents.
The term “Registrar” includes any co-registrars. The Company initially appoints the
Trustee as (i) Registrar, and Paying Agent in connection with the Securities and (ii) the Custodian
with respect to the Global Securities.

          (b) The Company shall enter into an appropriate agency agreement with any Registrar or Paying
Agent not a party to this Indenture, which shall incorporate the terms of the TIA. The agreement
shall implement the provisions of this Indenture that relate to such agent. The Company shall
notify the Trustee of the name and address of any such agent. If the Company fails to maintain a
Registrar or Paying Agent, the Trustee shall act as such and shall be entitled to appropriate
compensation therefor pursuant to Section 7.07. The Company or any of the Company’s domestically
organized Wholly Owned Subsidiaries may act as Paying Agent or Registrar.

          (c) The Company may remove any Registrar or Paying Agent upon written notice to such Registrar
or Paying Agent and to the Trustee; provided, however, that no such removal shall
become effective until (i) if applicable, acceptance of an appointment by a successor as evidenced
by an appropriate agreement entered into by the Company and such successor Registrar or Paying
Agent, as the case may be, and delivered to the Trustee or (ii) notification to the Trustee that
the Trustee shall serve as Registrar or Paying Agent until the appointment of a successor in
accordance with clause (i) above. The Registrar or Paying Agent may resign at any time upon
written notice to the Company and the Trustee; provided, however, that the Trustee
may resign as Paying Agent or Registrar only if the Trustee also resigns as Trustee in accordance
with Section 7.08.

          SECTION 2.05. Paying Agent to Hold Money in Trust. On or prior to each due date of
the principal of and interest on any Security, the Company shall deposit with each Paying Agent (or
if the Company or a Wholly Owned Subsidiary of the Company 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 and interest when so becoming due. The Company shall require each Paying Agent (other
than the Trustee) to agree in writing that a Paying Agent shall hold in trust for the benefit of
Holders or the Trustee all money held by a Paying Agent for the payment of principal of and
interest on the Securities, and shall notify the Trustee of any default by the Company in making
any such payment. If the Company or a Wholly Owned Subsidiary of the Company acts as Paying Agent,
it shall segregate the money held by it as Paying Agent and hold it in trust for the benefit of the
Persons entitled thereto. 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 such Paying Agent. Upon complying
with this Section 2.05, a Paying Agent shall have no further liability for the money delivered to
the Trustee.

          SECTION 2.06. 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

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Holders. If the Trustee is not the Registrar, the Company shall furnish, or cause the
Registrar to furnish, to the Trustee, in writing at least five Business Days before each interest
payment date and at such other times as the Trustee may request in writing, a list in such form and
as of such date as the Trustee may reasonably require of the names and addresses of Holders.

          SECTION 2.07. Transfer and Exchange. (a) The Securities shall be issued in
registered form and shall be transferable only upon the surrender of a Security for registration of
transfer and in compliance with Appendix A. When a Security is presented to the Registrar with a
request to register a transfer, the Registrar shall register the transfer as requested if its
requirements therefor are met. When Securities are presented to the Registrar with a request to
exchange them for an equal principal amount of Securities of the same series of other
denominations, the Registrar shall make the exchange as requested if the same requirements are met.
To permit registration of transfers and exchanges, the Company shall execute and the Trustee shall
authenticate Securities at the Registrar’s request. The Company is entitled to require payment of
a sum sufficient to pay all taxes, assessments or other governmental charges in connection with any
transfer or exchange pursuant to this Section 2.07. The Company shall not be required to make, and
the Registrar need not register, transfers or exchanges of Securities selected for redemption
(except, in the case of Securities to be redeemed in part, the portion thereof not to be redeemed)
or of any Securities for a period of 15 days before a selection of Securities to be redeemed.

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

          (c) Any Holder of a beneficial interest in a Global Security shall, by acceptance of such
beneficial interest, agree that transfers of beneficial interests in such Global Security may be
effected only through a book-entry system maintained by (a) the Holder of such Global Security (or
its agent) or (b) any Holder of a beneficial interest in such Global Security, and that ownership
of a beneficial interest in such Global Security shall be required to be reflected in a book entry.

          (d) All Securities 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 Securities surrendered upon such transfer or exchange.

          SECTION 2.08. Replacement Securities. (a) If a mutilated Security is surrendered to
the Registrar or if the Holder of a Security claims that the Security has been lost, destroyed or
wrongfully taken, the Company shall issue and the Trustee shall authenticate a replacement Security
of the same series if the requirements of Section 8-405 of the Uniform Commercial Code are met,
such that the Holder (i) 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, (ii) makes such request

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to the Company or the Trustee prior to the Security being acquired by a protected purchaser as
defined in Section 8–303 of the Uniform Commercial Code (a “protected purchaser”) and (iii)
satisfies any other reasonable requirements of the Trustee. If required by the Trustee or the
Company, such Holder shall furnish an indemnity bond sufficient in the judgment of the Company and
the Trustee to protect the Company, the Trustee, a Paying Agent and the Registrar from any loss
that any of them may suffer if a Security is replaced. The Company and the Trustee are entitled to
charge the Holder for their expenses in replacing a Security (including attorneys’ fees and
disbursements in replacing such Security). In the event any such mutilated, lost, destroyed or
wrongfully taken Security has become or is about to become due and payable, the Company in its
discretion is entitled to pay such Security instead of issuing a new Security in replacement
thereof.

          (b) Every replacement Security is an additional obligation of the Company and the Guarantors.

          (c) The provisions of this Section 2.08 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 Securities.

          SECTION 2.09. Outstanding Securities. (a) Securities outstanding at any time are all
Securities authenticated by the Trustee except for those canceled by it, those delivered to it for
cancelation, those redeemed pursuant to Article III and those described in this Section 2.09 as not
outstanding. Subject to Section 11.06, a Security does not cease to be outstanding because the
Company, a Guarantor or an Affiliate of the Company or a Guarantor holds the Security.

          (b) If a Security is replaced pursuant to Section 2.08 (other than a mutilated Security
surrendered for replacement), it ceases to be outstanding unless the Trustee and the Company
receive proof satisfactory to them that the replaced Security is held by a protected purchaser. A
mutilated Security ceases to be outstanding upon surrender of such Security and replacement thereof
pursuant to Section 2.08.

          (c) If a Paying Agent segregates and holds in trust, in accordance with this Indenture, on a
redemption date or maturity date money sufficient to pay all principal and interest payable on that
date with respect to the Securities (or portions thereof) to be redeemed or maturing, as the case
may be, then on and after that date such Securities (or portions thereof) cease to be outstanding
and interest on them ceases to accrue.

          SECTION 2.10. Temporary Securities. In the event that Definitive Securities are to be
issued under the terms of this Indenture, until such Definitive Securities are ready for delivery,
the Company may prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in the form of Definitive Securities but may have variations that
the Company considers appropriate for temporary Securities. Without unreasonable delay, the
Company shall prepare and the Trustee shall authenticate Definitive Securities and make them
available for delivery in exchange for temporary Securities upon surrender of such temporary
Securities at the office or agency of the Company, without charge to the Holder. Until such
exchange, temporary Securities shall be entitled to the same rights, benefits and privileges as
Definitive Securities.

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          SECTION 2.11. Cancellation. The Company at any time is entitled to deliver Securities
to the Trustee for cancellation. The Registrar and each Paying Agent shall forward to the Trustee
any Securities surrendered to them for registration of transfer, exchange or payment. The Trustee
and no one else shall cancel all Securities surrendered for registration of transfer, exchange,
payment or cancellation and shall dispose of canceled Securities in accordance with its customary
procedures or deliver canceled Securities to the Company pursuant to written direction by an
Officer. The Company shall not issue new Securities to replace Securities it has redeemed, paid or
delivered to the Trustee for cancellation. The Trustee shall not authenticate Securities in place
of canceled Securities 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 Securities, the Company shall pay the defaulted interest then borne by the Securities, as the
case may be (plus interest on such defaulted interest to the extent lawful), in any lawful manner.
The Company is entitled to 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
payment date and the amount of defaulted interest to be paid.

          SECTION 2.13. CUSIP Numbers, ISINs, etc. The Company in issuing the Securities shall
be entitled to use CUSIP numbers, ISINs and “Common Code” numbers (if then generally in use) and,
if so, the Trustee shall use CUSIP numbers, ISINs and “Common Code” numbers in notices of
redemption as a convenience to Holders; provided, however, that any such notice may
state that no representation is made as to the correctness of such numbers, either as printed on
the Securities or as contained in any notice of a redemption, that reliance may be placed only on
the other identification numbers printed on the Securities and that any such redemption shall not
be affected by any defect in or omission of such numbers. The Company shall advise the Trustee of
any change in the CUSIP numbers, ISINs and “Common Code” numbers.

ARTICLE III

Redemption

          SECTION 3.01. Redemption. The Securities may be redeemed, in whole, or from time to
time in part, subject to the conditions and at the redemption prices set forth in Paragraph 5 of
the form of Securities set forth in Appendix A, which are hereby incorporated by reference and made
a part of this Indenture, together with accrued and unpaid interest and Additional Interest, if
any, to the redemption date.

          SECTION 3.02. Applicability of Article. Redemption of Securities at the election of
the Company or otherwise, as permitted or required by the Securities or any provision of this
Indenture, shall be made in accordance with the Securities, such provision and this Article.

          SECTION 3.03. Notices to Trustee. If the Company elects to redeem Securities pursuant
to the optional redemption provisions of Paragraph 5 of the Security, it shall notify the

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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 Securities to be redeemed and (iv)
the redemption price. The Company shall give notice to the Trustee provided for in this paragraph
at least 30 days but not more than 60 days before a redemption date if the redemption is pursuant
to Paragraph 5 of the Security, 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
Securities 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 3.04. Selection of Securities to Be Redeemed. In the case of any partial
redemption of Securities, selection of the Securities for redemption will be made by the Trustee on
a pro rata basis to the extent practicable; provided, however, that no Securities
of $1,000 or less shall be redeemed in part. The Trustee shall make the selection from outstanding
Securities not previously called for redemption. The Trustee may select for redemption portions of
the principal of Securities that have denominations larger than $1,000 and portions of them the
Trustee selects shall be in principal amounts of $1,000 or a multiple of $1,000. Provisions of
this Indenture that apply to Securities called for redemption also apply to portions of Securities
called for redemption. The Trustee shall notify the Company promptly of the Securities or portions
of Securities to be redeemed at such Holder’s registered address.

          SECTION 3.05. Notice of Optional Redemption. (a) 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 Securities are to be redeemed.

          Any such notice shall identify the Securities to be redeemed and shall state:

     (i) the redemption date;

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

     (iii) the name and address of a Paying Agent;

     (iv) that Securities called for redemption must be surrendered to a Paying
Agent to collect the redemption price, plus accrued and unpaid interest;

     (v) if fewer than all the outstanding Securities are to be redeemed, the
certificate numbers and principal amounts of the particular Securities to be redeemed, the
aggregate principal amount of Securities to be redeemed and the aggregate principal amount
of Securities to be outstanding after such partial redemption;

     (vi) that, unless the Company defaults in making such redemption payment,
interest on Securities (or portion thereof) called for redemption ceases to accrue on and
after the redemption date;

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     (vii) the CUSIP number, ISIN or “Common Code” number, if any, printed on the
Securities being redeemed;

     (viii) that no representation is made as to the correctness or accuracy of
the CUSIP number or ISIN or “Common Code” number, if any, listed in such notice or printed
on the Securities; and

     (ix) the applicable provision in this Indenture or the Securities pursuant to
which the Company is redeeming such Securities.

          (b) At the Company’s request, the Trustee shall give the notice of redemption in the Company’s
name and at the Company’s expense. In such event, the Company shall provide the Trustee with the
information required by this Section 3.05.

          SECTION 3.06. Effect of Notice of Redemption. Once notice of redemption is mailed in
accordance with Section 3.05, Securities called for redemption become due and payable on the
redemption date and at the redemption price stated in the notice. Upon surrender to any Paying
Agent, such Securities shall be paid at the redemption price stated in the notice, plus accrued and
unpaid 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 Securities 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 3.07. Deposit of Redemption Price. With respect to any Securities, on or
prior to 11:00 a.m., New York City time, on the redemption date, the Company shall deposit with the
Paying Agent (or, if the Company or a Wholly Owned Subsidiary of the Company is a Paying Agent,
shall segregate and hold in trust) money sufficient to pay the redemption price of and accrued and
unpaid interest on all Securities or portions thereof to be redeemed on that date other than
Securities or portions of Securities 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 Securities or portions thereof called for redemption so long as the Company has deposited with
the Paying Agent funds sufficient to pay the principal of, plus accrued and unpaid interest on, the
Securities to be redeemed.

          SECTION 3.08. Securities Redeemed in Part. Upon surrender of a Security that is
redeemed in part, the Company shall execute and the Trustee shall authenticate for the Holder (at
the Company’s expense) a new Security equal in principal amount to the unredeemed portion of the
Security surrendered.

ARTICLE IV

Covenants

     SECTION 4.01. Payment of Securities. (a) The Company shall promptly pay the
principal of (and premium, if any) and interest, on the Securities on the dates and in the manner
provided in the Securities and in this Indenture. An installment of principal of or interest on
the Securities shall be considered paid on the date it is due if on such date the Trustee or any

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Paying Agent (other than the Company or any of its Affiliates) holds in accordance with this
Indenture money sufficient to pay all principal and interest then due.

          (b) The Company shall pay interest on overdue principal at the rate specified therefor in the
Securities and shall pay interest on overdue installments of interest at the same rate to the
extent lawful.

          SECTION 4.02. SEC Reports. Notwithstanding that the Company may not be subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company shall, after
effectiveness of the Exchange Offer Registration Statement or the Shelf Registration Statement, as
the case may be, file with the SEC and, in any event, provide the Trustee and Securityholders with
such annual reports and such information, documents and other reports as are specified in Sections
13 and 15(d) of the Exchange Act and applicable to a U.S. corporation subject to such Sections,
such information, documents and other reports to be so filed and provided at the times specified
for the filings of such information, documents and reports under such Sections.

          In addition, the Company shall furnish to the Holders of the Securities and to prospective
investors, upon the requests of such Holders, any information required to be delivered pursuant to
Rule 144A(d)(4) under the Securities Act so long as the Securities are not freely transferable
under the Securities Act.

          If Parent has complied with the reporting requirements of Section 13 or 15(d) of the Exchange
Act, and has provided the Trustee, the holders of the Securities and prospective investors with the
reports described herein with respect to Parent (including any financial information required by
Rule 3-10 of Regulation S-X and, if Parent, directly or indirectly, holds any material assets or
conducts any material business other than the assets of, or the business conducted by, the Company
and its Subsidiaries, a separate “Management’s Discussion and Analysis of Financial Condition and
Results of Operations” with respect to the Company and its Restricted Subsidiaries on a
consolidated basis), the Company shall be deemed to be in compliance with the provisions of this
Section 4.02.

          SECTION 4.03. Limitation on Indebtedness. (a) The Company shall not, and shall not
permit any Restricted Subsidiary to, Incur, directly or indirectly, any Indebtedness;
provided, however, that the Company and each Restricted Subsidiary shall be
entitled to Incur Indebtedness if, on the date of such Incurrence after giving effect thereto on a
pro forma basis no Default has occurred and is continuing and, the Consolidated Coverage Ratio
exceeds 2.0 to 1.

          (b) Notwithstanding Section 4.03(a), the Company and the Restricted Subsidiaries shall be
entitled to Incur any or all of the following Indebtedness:

	 	(1)	 	Indebtedness Incurred by the Company and its Restricted Subsidiaries pursuant to any
Revolving Credit Facility; provided, however, that, immediately after
giving effect to any such Incurrence, the sum of the aggregate principal amount of all
Indebtedness Incurred under this clause (1) and then outstanding and the aggregate face
amount of reimbursement obligations Incurred under Section 4.03(b)(13) below and then
outstanding does not exceed $135 million;

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	 	(2)	 	Indebtedness Incurred by the Company and its Restricted Subsidiaries pursuant to any
Term Loan Facility; provided, however, that, after giving effect to any
such Incurrence, the aggregate principal amount of all Indebtedness Incurred under this
clause (2) and then outstanding does not exceed $530 million less the sum of all principal
payments with respect to such Indebtedness pursuant to Section 4.06(a)(3)(A);
	 
	 	(3)	 	Indebtedness owed to and held by the Company or a Restricted Subsidiary;
provided, however, that (A) any subsequent issuance or transfer of any
Capital Stock which results in any such Restricted Subsidiary ceasing to be a Restricted
Subsidiary or any subsequent transfer of such Indebtedness (other than to the Company or a
Restricted Subsidiary) shall be deemed, in each case, to constitute the Incurrence of such
Indebtedness by the obligor thereon and (B) if the Company is the obligor on such
Indebtedness owed to a Restricted Subsidiary, such Indebtedness is expressly subordinated
to the prior payment in full in cash of all obligations with respect to the Securities;
	 
	 	(4)	 	the Securities (other than any Additional Securities);
	 
	 	(5)	 	Indebtedness outstanding on the Issue Date (other than Indebtedness described in clause
(1), (2), (3), (4) or (13) of this Section 4.03(b));
	 
	 	(6)	 	Refinancing Indebtedness in respect of Indebtedness Incurred pursuant to Section
4.03(a) or pursuant to clause (4) or (5) (other than any Existing Notes outstanding on the
Issue Date) or this clause (6) of this Section 4.03(b);
	 
	 	(7)	 	Hedging Obligations of the Company or any Restricted Subsidiary entered into not for
the purpose of speculation;
	 
	 	(8)	 	obligations in respect of one or more standby letters of credit, performance, bid and
surety bonds, workers compensation claims, self insurance obligations, bankers’ acceptances
and completion guarantees provided by the Company or any Restricted Subsidiary in the
ordinary course of business;
	 
	 	(9)	 	Indebtedness arising from the honoring by a bank or other financial institution of a
check, draft or similar instrument drawn against insufficient funds in the ordinary course
of business; provided, however, that such Indebtedness is extinguished
within five Business Days of its Incurrence;
	 
	 	(10)	 	(A) Indebtedness (including Capital Lease Obligations) Incurred by the Company or any
of its Restricted Subsidiaries to finance the purchase, lease, construction 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) within 180 days after such purchase,
lease or improvement or (B) Indebtedness attributable to Permitted Equipment Lease
Financings, in the case of (A) and (B), in an aggregate principal amount which, when added
together with the amount of Indebtedness previously Incurred pursuant to this clause (10)
and then outstanding (including any Refinancing Indebtedness with respect thereto) does not
exceed $25 million;

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	 	(11)	 	the Guarantee or co-issuance of any Indebtedness otherwise permitted to be Incurred
pursuant to this Indenture;
	 
	 	(12)	 	Indebtedness of the Company or any Restricted Subsidiary consisting of indemnification,
adjustment of purchase price, earn-out or similar obligations, in each case incurred in
connection with the acquisition or disposition of any assets, including shares of Capital
Stock or divisions or lines of business, of the Company or any Restricted Subsidiary;
	 
	 	(13)	 	reimbursement obligations Incurred by the Company and its Restricted Subsidiaries in
respect of letters of credit or synthetic letters of credit outstanding pursuant to the
Credit Agreement; provided, however, that after giving effect to any such
Incurrence, the sum of the aggregate face amount of such reimbursement obligations Incurred
under this clause (13) and then outstanding and the principal aggregate amount of
Indebtedness Incurred under Section 4.03 (b)(1) and then outstanding does not exceed $135
million; and
	 
	 	(14)	 	Indebtedness of the Company and its Restricted Subsidiaries in an aggregate principal
amount which, when taken together with all other Indebtedness of the Company and its
Restricted Subsidiaries outstanding on the date of such Incurrence (other than Indebtedness
permitted by clauses (1) through (13) of this Section 4.03(b) or Section 4.03(a)) does not
exceed $35 million; provided, however, that after giving effect to any such
Incurrence by a Restricted Subsidiary that is not a Subsidiary Guarantor, the principal
aggregate amount of Indebtedness Incurred by all Restricted Subsidiaries that are not
Subsidiary Guarantors pursuant to this clause (14) and then outstanding does not exceed $15
million.

          (c) Notwithstanding the foregoing, neither the Company nor any Subsidiary Guarantor shall
incur any Indebtedness pursuant to Section 4.03(b) if the proceeds thereof are used, directly or
indirectly, to Refinance any Subordinated Obligations of the Company or any Subsidiary Guarantor
(x) unless such Indebtedness shall be subordinated to the Securities or the applicable Subsidiary
Guaranty to at least the same extent as such Subordinated Obligations or (y) except to the extent
the purchase, repurchase, redemption, defeasance or other acquisition or retirement for value of
such Subordinated Obligations is made pursuant to Section 4.04(b)(12).

          (d) For purposes of determining compliance with this Section 4.03, (1) in the event that an
item of Indebtedness meets the criteria of more than one of the types of Indebtedness described
above, the Company, in its sole discretion, shall classify such item of Indebtedness at the time of
Incurrence and only be required to include the amount and type of such Indebtedness in one of the
above clauses and (2) the Company shall be entitled to divide and classify an item of Indebtedness
in more than one of the types of Indebtedness described above. In addition, from time to time the
Company shall be entitled to reclassify any Indebtedness Incurred pursuant to this Section 4.03
such that it will be deemed as having been Incurred under Section 4.03(a) or another clause in
Section 4.03(b), so long as such Indebtedness could have been Incurred under Section 4.03(a) or
such new clause at the time of such reclassification. Indebtedness under the Revolving Credit
Facility under the Credit Agreement outstanding on the Issue Date shall be deemed to have been
Incurred on the Issue Date in

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reliance on Section 4.03(b)(1). Indebtedness under the Term Loan Facility under the Credit
Agreement outstanding on the Issue Date shall be deemed to have been Incurred on the Issue Date in
reliance on Section 4.03(b)(2). Reimbursement obligations in respect of letters of credit or
synthetic letters of credit outstanding on the Issue Date under the Credit Agreement shall be
deemed to have been Incurred on the Issue Date in reliance on Section 4.03(b)(13).

          SECTION 4.04. Limitation on Restricted Payments. (a) The Company shall not, and
shall not permit any Restricted Subsidiary, directly or indirectly, to make a Restricted Payment if
at the time the Company or such Restricted Subsidiary makes such Restricted Payment:

	 	(1)	 	a Default shall have occurred and be continuing (or would result therefrom);
	 
	 	(2)	 	the Company is not entitled to Incur an additional $1.00 of Indebtedness pursuant to
Section 4.03(a); or
	 
	 	(3)	 	the aggregate amount of such Restricted Payment and all other Restricted Payments since
the Issue Date would exceed the sum of (without duplication):

	 	(A)	 	50% of the Consolidated Net Income accrued during the period (treated as
one accounting period) from the beginning of the fiscal quarter during which the
Issue Date occurs to the end of the most recent fiscal quarter for which internal
financial statements are then available prior to the date of such Restricted Payment
(or, in case such Consolidated Net Income shall be a deficit, minus 100% of such
deficit); plus
	 
	 	(B)	 	100% of the aggregate Net Cash Proceeds received by the Company from the
issuance or sale of its Capital Stock (other than Disqualified Stock) subsequent to
the Issue Date (other than an issuance or sale to a Subsidiary of the Company and
other than an issuance or sale to an employee stock ownership plan or to a trust
established by the Company or any of its Subsidiaries for the benefit of their
employees), 100% of any cash capital contribution received by the Company from its
shareholders subsequent to the Issue Date and 100% of the fair market value (as
determined in good faith by resolution of the Board of Directors of the Company) of
property (other than cash that would constitute Temporary Cash Investments) received
by the Company or a Restricted Subsidiary subsequent to the Issue Date as a
contribution to its common equity capital or from the issuance of its Capital Stock
(other than from a Subsidiary or that was financed with loans from the Company or any
of its Restricted Subsidiaries unless such loans have been paid off on or prior to
the date of determination); plus
	 
	 	(C)	 	the amount by which Indebtedness of the Company or a Restricted Subsidiary
is reduced on the Company’s consolidated balance sheet upon the conversion or
exchange (other than by a Subsidiary of the Company) subsequent to the Issue Date of
any Indebtedness of the Company or a Restricted Subsidiary convertible or
exchangeable for Capital Stock (other than Disqualified Stock) of the

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	 	 	 	Company (less the amount of any cash, or the fair value of any other property,
distributed by the Company upon such conversion or exchange); plus
	 
	 	(D)	 	an amount equal to the sum of (x) the net reduction in the Investments
(other than Permitted Investments) made by the Company or any Restricted Subsidiary
in any Person resulting from repurchases, repayments or redemptions of such
Investments by such Person, proceeds realized on the sale of such Investment and
proceeds representing the return of capital (excluding dividends and distributions),
in each case received by the Company or any Restricted Subsidiary, and (y) to the
extent such Person is an Unrestricted Subsidiary, the portion (proportionate to the
Company’s equity interest in such Subsidiary) of the fair market value of the net
assets of such Unrestricted Subsidiary at the time such Unrestricted Subsidiary is
designated a Restricted Subsidiary; provided, however, that the
foregoing sum shall not exceed, in the case of any such Person or Unrestricted
Subsidiary, the amount of Investments (excluding Permitted Investments) previously
made (and treated as a Restricted Payment) by the Company or any Restricted
Subsidiary in such Person or Unrestricted Subsidiary.

               (b) Section 4.04(a) will not prohibit:

	 	(1)	 	any Restricted Payment made out of the Net Cash Proceeds of the substantially
concurrent sale of, or made by exchange for, Capital Stock of the Company (other than
Disqualified Stock and other than Capital Stock issued or sold to a Subsidiary of the
Company or an employee stock ownership plan or to a trust established by the Company or any
of its Subsidiaries for the benefit of their employees) or a substantially concurrent cash
capital contribution received by the Company from its shareholders; provided,
however, that (A) such Restricted Payment shall be excluded in the calculation of
the amount of Restricted Payments and (B) the Net Cash Proceeds from such sale or such cash
capital contribution (to the extent so used for such Restricted Payment) shall be excluded
from the calculation of amounts under Section 4.04(a)(3)(B);
	 
	 	(2)	 	any purchase, repurchase, redemption, defeasance or other acquisition or retirement for
value of Subordinated Obligations of the Company or any Subsidiary Guarantor made (a) by
exchange for, or out of the proceeds of the substantially concurrent sale of, Indebtedness
which is permitted to be Incurred pursuant to Section 4.03 or (b) upon a Change of Control
or in connection with an Asset Disposition to the extent required by the agreement
governing such Subordinated Obligations but only if the Company shall have complied with
Section 4.06 or 4.08, respectively, and purchased all Securities validly tendered pursuant
to the relevant offer prior to redeeming such Subordinated Obligation; provided,
however, that such purchase, repurchase, redemption, defeasance or other
acquisition or retirement for value shall be excluded in the calculation of the amount of
Restricted Payments;
	 
	 	(3)	 	dividends paid within 60 days after the date of declaration thereof if at such date of
declaration such dividend would have complied with this Section 4.04; provided,

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	 	 	 	however, that such dividend shall be included in the calculation of the amount of
Restricted Payments;
	 
	 	(4)	 	so long as no Default has occurred and is continuing, the repurchase or other
acquisition of shares of Capital Stock of Buffets Restaurants, the Parent or the Company or
any of its Subsidiaries (or any Restricted Payment to the extent necessary to fund such
repurchase or acquisition) from employees, former employees, directors or former directors
of Buffets Restaurants, the Parent or the Company or any of its Subsidiaries (or permitted
transferees of such employees, former employees, directors or former directors), pursuant
to the terms of the agreements (including employment, severance, compensation or
shareholder agreements) or plans (or amendments thereto) approved by the Board of Directors
of Buffets Restaurants, the Parent or the Company, as the case may be, under which such
individuals purchase or sell or are granted the option to purchase or sell, shares of such
Capital Stock; provided, however, that the aggregate amount of such
repurchases and other acquisitions shall not exceed in any calendar year the sum of (A)
$5.0 million (with unused amounts in any calendar year being carried over to the next
succeeding calendar year subject to a maximum (without giving effect to the following
clauses (B) and (C)) of $10.0 million in any calendar year) plus (B) the aggregate Net Cash
Proceeds received by the Company from the issuance of such Capital Stock to, or the
exercise of options to purchase such Capital Stock by, employees or directors of the
Company or any of its Subsidiaries that occurs after the Issue Date (to the extent the Net
Cash Proceeds from the sale of such Capital Stock have not otherwise been applied to the
payment of Restricted Payments by virtue of Section 4.04(a)(3)(B) or applied pursuant to
Section 4.04(b)(1)) plus (C) the Net Cash Proceeds actually received by the Company after
the Issue Date from insurance proceeds paid in respect of the death or disability of any
employee or director; provided further, however, that such repurchases and
other acquisitions shall be excluded in the calculation of the amount of Restricted
Payments;
	 
	 	(5)	 	dividends, distributions or advances to Buffets Restaurants or Parent to be used by
Buffets Restaurants or Parent to pay Federal, state and local taxes payable by Parent or
Buffets Restaurants and directly attributable to (or arising as a result of) the operations
of the Company and its Restricted Subsidiaries; provided, however, that the
amount of such dividends shall not exceed the amount that the Company and its Restricted
Subsidiaries would be required to pay in respect of such Federal, state and local taxes
were the Company to pay such taxes as a stand-alone taxpayer; provided further,
however, that such dividends shall be excluded in the calculation of the amount of
Restricted Payments;
	 
	 	(6)	 	any Restricted Payment made to (i) the Parent to pay the interest on, or repurchase or
redeem the Parent Notes and (ii) Buffets Restaurants or the Parent to be used by Buffets
Restaurants or the Parent solely (A) to pay its franchise taxes and other fees required to
maintain its corporate existence, (B) to pay for general corporate, overhead and other
expenses of Parent and Buffets Restaurants (including salaries and other compensation of
the employees and directors, board activities, insurance, legal (including litigation,
judgments and settlements), accounting, corporate reporting, administrative and other
operating and non-operating expenses) and (C) to pay

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expenses incurred in connection with offerings of securities, debt financings or
acquisition or disposition transactions; provided, however, that all such
Restricted Payments under the preceding clause (ii) shall not exceed in the aggregate
$3.0 million per year; provided further, however, that such Restricted
Payments pursuant to this clause (6) shall be excluded in the calculation of the amount
of Restricted Payments;

	 	(7)	 	Permitted Closing Date Payments; provided, however, that such payments
shall be excluded in the calculation of the amount of Restricted Payments;
	 
	 	(8)	 	payments of intercompany subordinated debt, the Incurrence of which was permitted under
Section 4.03(b)(3); provided, however, that no Default or Event of Default
has occurred and is continuing or would otherwise result therefrom, provided
further, however, that such payments shall be excluded in the calculation of
the amount of Restricted Payments;
	 
	 	(9)	 	repurchases of Capital Stock deemed to occur upon exercise of stock options if such
Capital Stock represents a portion of the exercise price of such options; provided,
however, that such Restricted Payments shall be excluded in the calculation of the
amount of Restricted Payments;
	 
	 	(10)	 	the purchase of fractional shares by the Company upon conversion of any securities of
the Company into Capital Stock of the Company; provided, however, that such
purchase shall be excluded in the calculation of the amount of Restricted Payments;
	 
	 	(11)	 	payments to Parent in an aggregate amount not to exceed $5.0 million in any calendar
year (with unused amounts in any calendar year being carried over to the next succeeding
calendar year subject to a maximum of $10.0 million in any calendar year) to be used solely
to redeem, purchase or otherwise acquire for value warrants outstanding on the Issue Date
to acquire Capital Stock of Parent; provided, however, that such payments
shall not be made prior to September 29, 2008; provided further, however,
that such payments shall be excluded in the calculation in the amount of Restricted
Payments; or
	 
	 	(12)	 	Restricted Payments not exceeding $25 million in the aggregate; provided,
however, that (A) at the time of such Restricted Payments, no Default shall have
occurred and be continuing (or result therefrom) and (B) such Restricted Payments shall be
excluded in the calculation of the amount of Restricted Payments.

For purposes of determining compliance with this Section 4.04, in the event that a proposed
Restricted Payment meets the criteria of more than one of the categories of Restricted Payments
described in Section 4.04(b)(1) through (12), or is entitled to be incurred pursuant to Section
4.04(a), the Company shall be entitled to classify such item of Restricted Payment on the date of
its payment in any manner that complies with this Section 4.04.

          SECTION 4.05. Limitation on Restrictions on Distributions from Restricted
Subsidiaries. The Company shall not, and shall not permit any Restricted Subsidiary to, create
or otherwise cause or permit to exist or become effective any consensual encumbrance or restriction
on the ability of any Restricted Subsidiary to (a) pay dividends or make any other distributions

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on its Capital Stock to the Company or a Restricted Subsidiary or pay any Indebtedness owed to
the Company or a Subsidiary Guarantor, (b) make any loans or advances to the Company or (c)
transfer any of its property or assets to the Company, except:

	 	(1)	 	with respect to clauses (a), (b) and (c),

	 	(i)	 	any encumbrance or restriction pursuant to an agreement in effect at or
entered into on the Issue Date;
	 
	 	(ii)	 	any encumbrance or restriction with respect to a Restricted Subsidiary
pursuant to an agreement relating to any Indebtedness Incurred by such Restricted
Subsidiary on or prior to the date on which such Restricted Subsidiary was acquired
by the Company (other than Indebtedness Incurred as consideration in, or to provide
all or any portion of the funds or credit support utilized to consummate, the
transaction or series of related transactions pursuant to which such Restricted
Subsidiary became a Restricted Subsidiary or was acquired by the Company) and
outstanding on such date;
	 
	 	(iii)	 	any encumbrance or restriction pursuant to an agreement effecting a
Refinancing of Indebtedness Incurred pursuant to an agreement referred to in Section
4.05(1)(i) or (ii) or this clause (iii) or contained in any amendment to an agreement
referred to in Section 4.05(1)(i) or (ii) or this clause (iii); provided,
however, that the encumbrances and restrictions with respect to such
Restricted Subsidiary contained in any such refinancing agreement or amendment are no
less favorable, taken as a whole, to the Securityholders than encumbrances and
restrictions with respect to such Restricted Subsidiary contained in such predecessor
agreements;
	 
	 	(iv)	 	any encumbrance or restriction consisting of any restriction on the sale or
other disposition of assets or property securing Indebtedness as a result of a Lien
permitted to be Incurred under this Indenture on such asset or property;
	 
	 	(v)	 	any encumbrance or restriction with respect to a Restricted Subsidiary
imposed pursuant to an agreement entered into for the sale or disposition of all or a
portion of the Capital Stock or assets of such Restricted Subsidiary pending the
closing of such sale or disposition;
	 
	 	(vi)	 	any encumbrance or restriction arising under applicable law, regulation or
order;
	 
	 	(vii)	 	any restriction on cash or other deposits or net worth imposed by
suppliers or landlords under contracts entered into in the ordinary course of
business;
	 
	 	(viii)	 	any restriction in any agreement that is not materially more restrictive than the
restrictions under the terms of the Credit Agreement as in effect on the Issue Date;
	 
	 	(ix)	 	any encumbrances or restrictions created with respect to (A) Indebtedness
of the Company or Subsidiary Guarantors permitted to be Incurred subsequent to the

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	 	 	 	Issue Date pursuant to Section 4.03 and (B) Indebtedness of other Restricted
Subsidiaries permitted to be Incurred subsequent to the Issue Date pursuant to
Section 4.03; provided, however, that the Board of Directors of the
Company determines (as evidenced by a resolution of the Board of Directors of the
Company) in good faith at the time such encumbrances or restrictions are created
that such encumbrances or restrictions would not reasonably be expected to impair
the ability of the Company to make payments of interest and of principal on the
Securities in each case as and when due; and
	 
	 	(x)	 	non-assignment provisions of any contract or any lease entered into in the
ordinary course of business; and
	 
	 	(xi)	 	provisions with respect to dividends, the disposition or distribution of
assets or property in joint venture agreements, asset sale agreements, stock sale
agreements and other similar agreements entered into in the ordinary course of
business.

	 	(2)	 	with respect to clause (c) only,

	 	(i)	 	any such encumbrance or restriction consisting of customary nonassignment
provisions in leases governing leasehold interests to the extent such provisions
restrict the transfer of the lease or the property leased thereunder; and
	 
	 	(ii)	 	encumbrance or restrictions contained in security agreements or mortgages
securing Indebtedness of a Restricted Subsidiary to the extent such restrictions
restrict the transfer of the property subject to such security agreements or
mortgages.

          SECTION 4.06. Limitation on Sales of Assets and Subsidiary Stock. (a) The Company
shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, consummate
any Asset Disposition unless:

	 	(1)	 	the Company or such Restricted Subsidiary receives consideration at the time of such
Asset Disposition at least equal to the fair market value (including as to the value of all
non-cash consideration), as determined in good faith by the Board of Directors of the
Company or the chief financial or accounting Officer of the Company, of the shares and
assets subject to such Asset Disposition;
	 
	 	(2)	 	at least 75% of the consideration thereof received by the Company or such Restricted
Subsidiary is in the form of cash or cash equivalents (provided that such 75% requirement
shall not apply to any Asset Disposition in which the cash or cash equivalents portion of
the consideration received therefor is no less than an amount equal to the product of (x)
4.5 and (y) the amount of EBITDA for the previously completed four fiscal quarters directly
attributable to the assets or Capital Stock included in such Asset Disposition); and
	 
	 	(3)	 	an amount equal to 100% of the Net Available Cash from such Asset Disposition is
applied by the Company (or such Restricted Subsidiary, as the case may be)

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	 	(A)	 	first, to the extent the Company elects (or is required by the
terms of any Indebtedness), to prepay, repay, redeem or purchase Senior Indebtedness
of the Company or of a Subsidiary Guarantor or Indebtedness (other than any
Disqualified Stock) of a Wholly Owned Subsidiary (in each case other than
Indebtedness owed to the Company or a Subsidiary of the Company) within one year from
the later of the date of such Asset Disposition or the receipt of such Net Available
Cash;
	 
	 	(B)	 	second, to the extent of the balance of such Net Available Cash
after application in accordance with clause (A), to the extent the Company elects, to
acquire Additional Assets within one year from the later of the date of such Asset
Disposition or the receipt of such Net Available Cash; provided,
however, that the Company or such Restricted Subsidiary shall be deemed to
have applied Net Available Cash in accordance with this clause (B) within such
one-year period if, within such one-year period, it has entered into a binding
commitment or agreement to invest such Net Available Cash and continues to use all
reasonable efforts to so apply such Net Available Cash as soon as practicable
thereafter; provided further, however, that such Net Available Cash
is applied on the earlier of (x) a date that is 18 months from the later of the date
of such Asset Disposition or the receipt of such Net Available Cash or (y) promptly
upon any abandonment or termination of such commitment or agreement;
	 
	 	(C)	 	third, to the extent of the balance of such Net Available Cash
after application in accordance with clauses (A) and (B), to make an offer to the
holders of the Securities (and to holders of other Senior Indebtedness of the Company
designated by the Company) to purchase Securities (and such other Senior Indebtedness
of the Company) pursuant to and subject to the conditions contained in Section
4.06(b), (c) and (d); and
	 
	 	(D)	 	fourth, to the extent of the balance of such Net Available Cash
after application in accordance with clauses (A), (B) and (C), for any purpose not
prohibited by the terms of this Indenture;

provided, however, that in connection with any prepayment, repayment or
purchase of Indebtedness pursuant to clause (A) or (C) above, the Company or such Restricted
Subsidiary shall permanently retire such Indebtedness and shall cause the related loan
commitment (if any) to be permanently reduced in an amount equal to the principal amount so
prepaid, repaid or purchased.

Notwithstanding the foregoing provisions of this Section 4.06, the Company and the Restricted
Subsidiaries shall not be required to apply any Net Available Cash in accordance with this Section
4.06 except to the extent that the aggregate Net Available Cash from all Asset Dispositions which
are not applied in accordance with this Section 4.06 exceeds $10.0 million. Pending application of
Net Available Cash pursuant to this Section 4.06, such Net Available Cash may be invested in
Temporary Cash Investments or applied to temporarily reduce Senior Indebtedness of the Company.

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          For the purposes of this Section 4.06, the following are deemed to be cash or cash
equivalents:

	 	(1)	 	the assumption of Indebtedness of the Company or any Restricted Subsidiary and the
release of the Company or such Restricted Subsidiary from all liability on such
Indebtedness in connection with such Asset Disposition; and
	 
	 	(2)	 	the amount of any obligations or securities received by the Company or any Restricted
Subsidiary from the transferee that are converted by the Company or such Restricted
Subsidiary into cash within 90 days of receipt thereof.

          (b) In the event of an Asset Disposition that requires the purchase of Securities (and other
Senior Indebtedness of the Company) pursuant to clause (a)(3)(C) above, the Company shall purchase
Securities tendered pursuant to an offer (the “Offer”) by the Company for the Securities
(and such other Senior Indebtedness) at a purchase price of 100% of their principal amount (or, in
the event such other Senior Indebtedness of the Company was issued with significant original issue
discount, 100% of the accreted value thereof), without premium, plus accrued but unpaid interest
(or, in respect of such other Senior Indebtedness of the Company, such lesser price, if any, as may
be provided for by the terms of such Senior Indebtedness) in accordance with the procedures
(including prorating in the event of oversubscription) set forth in Section 4.06(c) and (d). If the
aggregate purchase price of the Securities (and such other Senior Indebtedness) tendered exceeds
the Net Available Cash allotted to their purchase, the Company shall select the Securities (and
other such Senior Indebtedness) to be purchased on a pro rata basis but in round denominations,
which in the case of the Securities will be denominations of $1,000 principal amount or multiples
thereof. The Company shall not be required to make such an Offer to purchase Securities (and other
Senior Indebtedness of the Company) pursuant to this Section 4.06 if the Net Available Cash
available therefor is less than $20.0 million (which lesser amount shall be carried forward for
purposes of determining whether such an offer is required with respect to the Net Available Cash
from any subsequent Asset Disposition).

     (c) (1) Promptly, and in any event within 10 days after the Company becomes obligated
to make an Offer, the Company shall deliver to the Trustee and send, by first-class mail to
each Holder, a written notice stating that the Holder may elect to have his Securities
purchased by the Company either in whole or in part (subject to prorating as described in
Section 4.06(b) in the event the Offer is oversubscribed) in a minimum amount of $1,000 or
in larger integral multiples of $1,000 of principal amount, at the applicable purchase
price. The notice shall specify a purchase date not less than 30 days nor more than 60 days
after the date of such notice (the “Purchase Date”) and shall state (A) that the
Company has become obligated to make an Offer, (B)the aggregate principal amount of
Securities that is subject to such Offer, (C) the purchase price, (D) the circumstances and
relevant facts regarding such Asset Disposition, (E) the Purchase Date and (F) the
instructions, as determined by the Company, consistent with this Section 4.06, that a Holder
must follow in order to have its Securities purchased.

     (2) Not later than the date upon which written notice of an Offer is
delivered to the Trustee as provided above, the Company shall deliver to the Trustee an
Officers’

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Certificate as to (A) the amount of the Offer (the “Offer Amount”), including
information as to any other Senior Indebtedness included in the Offer and (B) the allocation
of the Net Available Cash from the Asset Dispositions pursuant to which such Offer is being
made. Upon the expiration of the period for which the Offer remains open (the “Offer
Period”), the Company shall deliver to the Trustee for cancellation the Securities or
portions thereof which have been properly tendered to and are to be accepted by the Company.
The Trustee shall, on the Purchase Date, mail or deliver payment (or cause the delivery of
payment) to each tendering Holder in the amount of the purchase price. On or prior to the
Purchase Date, the Company shall deposit with the Trustee money sufficient to pay the
purchase price for all Securities accepted for purchase pursuant to and in accordance with
the terms of this Section. In the event that the aggregate purchase price of the Securities
delivered by the Company to the Trustee is less than the Offer Amount applicable to the
Securities, the Trustee shall deliver the excess to the Company promptly after the
expiration of the Offer Period for application in accordance with this Section 4.06.

     (3) Holders electing to have a Security purchased shall be required to
surrender the Security, with an appropriate form duly completed, to the Company at the
address specified in the notice at least three Business Days prior to the Purchase Date.
Holders shall be entitled to withdraw their election if the Trustee or the Company receives
not later than one Business Day prior to the Purchase Date, a telex, facsimile transmission
or letter setting forth the name of the Holder, the principal amount of the Security which
was delivered for purchase by the Holder and a statement that such Holder is withdrawing his
election to have such Security purchased.

     (4) Holders whose Securities are purchased only in part shall be issued new
Securities equal in principal amount to the unpurchased portion of the Securities
surrendered.

     (5) At the time the Company delivers Securities to the Trustee which are to
be accepted for purchase, the Company shall also deliver an Officers’ Certificate stating
that such Securities are to be accepted by the Company pursuant to and in accordance with
the terms of this Section. A Security shall be deemed to have been accepted for purchase at
the time the Trustee, directly or through an agent, mails or delivers payment therefor to
the surrendering Holder.

          (d) The Company shall comply, to the extent applicable, with the requirements of Section 14(e)
of the Exchange Act and any other securities laws or regulations in connection with the repurchase
of Securities pursuant to this Section 4.06. To the extent that the provisions of any securities
laws or regulations conflict with provisions of this Section 4.06, the Company shall comply with
the applicable securities laws and regulations and shall not be deemed to have breached its
obligations under this Section 4.06 by virtue of its compliance with such securities laws or
regulations.

          SECTION 4.07. Limitation on Affiliate Transactions. (a) The Company shall not, and
shall not permit any Restricted Subsidiary to, enter into or permit to exist any transaction
(including the purchase, sale, lease or exchange of any property, employee

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compensation arrangements or the rendering of any service) with, or for the benefit of, any
Affiliate of the Company (an “Affiliate Transaction”) unless:

	 	(1)	 	the terms of the Affiliate Transaction are no less favorable to the Company or such
Restricted Subsidiary than those that could be obtained at the time of the Affiliate
Transaction in arm’s-length dealings with a Person who is not an Affiliate;
	 
	 	(2)	 	if such Affiliate Transaction involves an amount in excess of $5.0 million, the
material terms of the Affiliate Transaction are set forth in writing and a majority of the
directors of the Company disinterested with respect to such Affiliate Transaction have
determined in good faith that the criteria set forth in clause (1) are satisfied and have
approved the relevant Affiliate Transaction as evidenced by a Board resolution; and
	 
	 	(3)	 	if such Affiliate Transaction involves an amount in excess of $20.0 million, the Board
of Directors of the Company shall also have received a written opinion from an Independent
Qualified Party to the effect that the financial terms of such Affiliate Transaction are
fair, from a financial standpoint, to the Company and its Restricted Subsidiaries or not
less favorable to the Company and its Restricted Subsidiaries than could reasonably be
expected to be obtained at the time in an arm’s-length transaction with a Person who was
not an Affiliate.

Notwithstanding clause (2) above, in the event that there are no disinterested members of the Board
of Directors of the Company in any Affiliate Transaction, such Affiliate Transaction shall be
permitted to exist so long as an Independent Qualified Party has determined the financial terms of
such Affiliate Transaction to be fair, from a financial standpoint, to the Company and its
Restricted Subsidiaries or is not less favorable to the Company and its Restricted Subsidiaries
than could reasonably be expected to be obtained at the time in an arm’s-length transaction with a
Person who was not an Affiliate.

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

	 	(1)	 	any Investment (other than a Permitted Investment described in clause (a) or (b) of the
definition thereof) or other Restricted Payment, in each case permitted to be made pursuant
to, or not prohibited by, Section 4.04;
	 
	 	(2)	 	any issuance of securities, or other payments, awards or grants in cash, securities or
otherwise pursuant to, or the funding of, employment, compensation or severance
arrangements, stock options and stock ownership plans approved by the Board of Directors of
the Company;
	 
	 	(3)	 	loans or advances to employees in the ordinary course of business in accordance with
the past practices of the Company or its Restricted Subsidiaries or otherwise approved by
the Board of Directors of the Company, but in any event not to exceed $2.5 million in the
aggregate outstanding at any one time;
	 
	 	(4)	 	the payment of reasonable compensation or employee benefit arrangements to and
indemnity provided for the benefit of directors, officers or employees of the Company or
its Restricted Subsidiaries in the ordinary course of business;

-50-

 

	 	(5)	 	the payment of reasonable fees to directors of the Company and its Restricted
Subsidiaries who are not employees of the Company or its Restricted Subsidiaries;
	 
	 	(6)	 	the payment of fees to Caxton-Iseman Capital, Inc. or its affiliates pursuant to the
terms of the advisory agreement with Caxton-Iseman Capital, Inc. or its affiliates, as in
effect on the Issue Date; provided, however, that in connection with an
Equity Offering, the Company may terminate the advisory agreement with Caxton-Iseman
Capital, Inc. and pay a termination fee from the proceeds of such Equity Offering;
	 
	 	(7)	 	any transaction with a Restricted Subsidiary or joint venture or similar entity which
would constitute an Affiliate Transaction solely because the Company or a Restricted
Subsidiary owns an equity interest in or otherwise controls such Restricted Subsidiary,
joint venture or similar entity;
	 
	 	(8)	 	the entering into of a registration rights agreement with the stockholders or
debtholders of the Company;
	 
	 	(9)	 	the issuance or sale of any Capital Stock (other than Disqualified Stock) of the
Company;
	 
	 	(10)	 	any merger, consolidation or reorganization with (i) Parent or Buffets Restaurants,
solely for the purposes of reorganizing to facilitate the initial public offering of the
Company, Parent or Buffets Restaurants or (ii) with an Affiliate solely for the purpose and
with the sole effect of forming a holding company or reincorporating the Company in a new
jurisdiction;
	 
	 	(11)	 	the entering into of a tax sharing agreement, or payments pursuant thereto, between the
Company and one or more Subsidiaries, on the one hand, and any other Person with which the
Company and such Subsidiaries are required or permitted to file a consolidated tax return
or with which the Company and such Subsidiaries are part of a consolidated group for tax
purposes, on the other hand, which payments by the Company and the Restricted Subsidiaries
are not in excess of the payments permitted by Section 4.04(b)(5);
	 
	 	(12)	 	indemnification agreements with, and the payment of the fees and indemnities to,
directors, officers and employees of the Company and its Restricted Subsidiaries, in each
case in the ordinary course of business;
	 
	 	(13)	 	any employment, deferred compensation, consulting, noncompetition, confidentiality or
similar agreement entered into by the Company and its Restricted Subsidiaries with its
employees or directors in the ordinary course of business; and
	 
	 	(14)	 	any agreement as in effect on the Issue Date and described in the Offering Circular or
any renewals or extensions of any such agreement (so long as such renewals or extensions
are not less favorable to the Company or the Restricted Subsidiaries) and the transactions
evidenced thereby.

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          SECTION 4.08. Change of Control. (a) Upon the occurrence of a Change of Control,
each Holder shall have the right to require that the Company repurchase such Holder’s Securities at
a purchase price in cash equal to 101% of the principal amount thereof on the date of purchase plus
accrued and unpaid interest, if any, to the date of purchase (subject to the right of holders of
record on the relevant record date to receive interest due on the relevant interest payment date),
in accordance with the terms contemplated in Section 4.08(b).

          (b) Within 30 days following any Change of Control, the Company shall mail or otherwise
deliver a notice to each Holder with a copy to the Trustee (the “Change of Control Offer”)
stating:

     (1) that a Change of Control has occurred and that such Holder has the right
to require the Company to purchase such Holder’s Securities at a purchase price in cash
equal to 101% of the principal amount thereof on the date of purchase, plus accrued and
unpaid interest, if any, to the date of purchase (subject to the right of Holders of record
on the relevant record date to receive interest on the relevant interest payment date);

     (2) the circumstances and relevant facts regarding such Change of Control;

     (3) the purchase date (which shall be no earlier than 30 days nor later than
60 days from the date such notice is mailed); and

     (4) the instructions, as determined by the Company, consistent with this
Section, that a Holder must follow in order to have its Securities purchased.

          (c) Holders electing to have a Security purchased will be required to surrender the Security,
with an appropriate form duly completed, to the Company at the address specified in the notice at
least three Business Days prior to the purchase date. Holders will be entitled to withdraw their
election if the Trustee or the Company receives not later than one Business Day prior to the
purchase date, a telegram, telex, facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the Security which was delivered for purchase by the Holder and a
statement that such Holder is withdrawing his election to have such Security purchased.

          (d) On the purchase date, all Securities purchased by the Company under this Section shall be
delivered by the Company to the Trustee for cancellation, and the Company shall pay the purchase
price plus accrued and unpaid interest, if any, to the Holders entitled thereto.

          (e) Notwithstanding the foregoing provisions of this Section, the Company shall not be
required to make a Change of Control Offer following a Change of Control if a third party makes the
Change of Control Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in this Section applicable to a Change of Control Offer made by the Company
and purchases all Securities validly tendered and not withdrawn under such Change of Control Offer.

          (f) The Company shall comply, to the extent applicable, with the requirements of Section 14(e)
of the Exchange Act and any other securities laws or regulations in connection

-52-

 

with the repurchase of Securities pursuant to this Section 4.08. To the extent that the
provisions of any securities laws or regulations conflict with the provisions of this Section 4.08,
the Company shall comply with the applicable securities laws and regulations and shall not be
deemed to have breached its obligations under this Section 4.08 by virtue of its compliance with
such securities laws or regulations.

          SECTION 4.09. Limitation on Liens. The Company shall not, and shall not permit any
Restricted Subsidiary to, directly or indirectly, Incur or permit to exist any Lien (the
“Initial Lien”) of any nature whatsoever on any of its properties (including Capital Stock
of a Restricted Subsidiary), whether owned at the Issue Date or thereafter acquired, securing any
Indebtedness, other than Permitted Liens, without effectively providing that the Securities shall
be secured equally and ratably with (or prior to) the obligations so secured for so long as such
obligations are so secured.

          Any Lien created for the benefit of the Holders of the Securities pursuant to the 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 Initial Lien.

          SECTION 4.10. Future Guarantors. The Company shall cause each domestic Restricted
Subsidiary of the Company and any other domestic Restricted Subsidiary formed or acquired after the
Issue Date, in each case, that Guarantees Indebtedness of the Company or a Subsidiary Guarantor
under the Credit Agreement to, at the same time, execute and deliver to the Trustee a Guaranty
Agreement pursuant to which such Restricted Subsidiary will Guarantee payment of the Securities on
the same terms and conditions as those set forth in this Indenture.

          SECTION 4.11. Compliance Certificate. The Company shall deliver to the Trustee within
120 days after the end of each fiscal year of the Company an Officers’ Certificate stating that in
the course of the performance by the signers of their duties as Officers of the Company they would
normally have knowledge of any Default and whether or not the signers know of any Default that
occurred during such period. If they do, the certificate shall describe the Default, its status
and what action the Company is taking or proposes to take with respect thereto. The Company also
shall comply with Section 314(a)(4) of the TIA.

          SECTION 4.12. Further Instruments and Acts. Upon request of the Trustee, the Company
shall execute and deliver such further instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the purpose of this Indenture.

ARTICLE V

Merger, Consolidation or Sale of All

or Substantially All Assets

          SECTION 5.01. Merger and Consolidation. (a) The Company shall not consolidate with
or merge with or into, or convey, transfer or lease, in one transaction or a series of
transactions, directly or indirectly, all or substantially all its assets to, any Person, unless:

	 	(1)	 	the resulting, surviving or transferee Person (the “Successor Company”) shall
be a Person organized and existing under the laws of the United States of America, any

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	 	 	 	State thereof or the District of Columbia and the Successor Company (if not the Company)
shall expressly assume, by an indenture supplemental thereto, executed and delivered to
the Trustee, in form reasonably satisfactory to the Trustee, all the obligations of the
Company under the Securities and this Indenture;
	 
	 	(2)	 	immediately after giving pro forma effect to such transaction (and treating any
Indebtedness which becomes an obligation of the Successor Company or any Subsidiary as a
result of such transaction as having been Incurred by such Successor Company or such
Subsidiary at the time of such transaction), no Default shall have occurred and be
continuing;
	 
	 	(3)	 	immediately after giving pro forma effect to such transaction, (A) the Successor
Company would be able to Incur an additional $1.00 of Indebtedness pursuant to Section
4.03(a) or (B) the Consolidated Coverage Ratio for the Successor Company and its Restricted
Subsidiaries would be equal to or greater than such ratio for the Company and its
Restricted Subsidiaries immediately prior to such transaction; and
	 
	 	(4)	 	the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion
of Counsel, each stating that such consolidation, merger or transfer and such supplemental
indenture (if any) comply with this Indenture;

provided, however, that clause (3) shall not be applicable to (A) a Restricted
Subsidiary consolidating with, merging into or transferring all or part of its properties and
assets to the Company or any Restricted Subsidiary or (B) the Company merging with an Affiliate of
the Company solely for the purpose and with the sole effect of reincorporating the Company in
another jurisdiction.

          The Successor Company shall be the successor to the Company and shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under this Indenture, and
the predecessor Company, except in the case of a lease, shall be released from the obligation to
pay the principal of and interest on the Securities.

          (b) The Company shall not permit any Subsidiary Guarantor to consolidate with or merge with or
into, or convey, transfer or lease, in one transaction or a series of transactions, all or
substantially all of its assets to any Person unless:

	 	(1)	 	the resulting, surviving or transferee Person (if not such Subsidiary) shall be a
Person organized and existing under the laws of the jurisdiction under which such
Subsidiary was organized or under the laws of the United States of America, or any State
thereof or the District of Columbia, and such Person shall expressly assume, by a Guaranty
Agreement, in a form reasonably satisfactory to the Trustee, all the obligations of such
Subsidiary, if any, under its Subsidiary Guaranty, except that the foregoing requirements
of this clause (b)(1) shall not apply in the case of a Subsidiary Guarantor that has been
disposed of in its entirety to another Person (other than to the Company or a Subsidiary of
the Company) or otherwise ceases to be a Subsidiary Guarantor as a result of such
transaction or series of transactions, whether through a merger, consolidation or sale of
Capital Stock or assets, if in connection therewith the

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	 	 	 	Company provides an Officers’ Certificate to the Trustee to the effect that the Company
shall comply with its obligations under Section 4.06 in respect of such disposition;
	 
	 	(2)	 	immediately after giving effect to such transaction or transactions on a pro forma
basis (and treating any Indebtedness which becomes an obligation of the resulting,
surviving or transferee Person as a result of such transaction as having been issued by
such Person at the time of such transaction), no Default shall have occurred and be
continuing; and
	 
	 	(3)	 	the Company delivers to the Trustee an Officers’ Certificate and an Opinion of Counsel,
each stating that such consolidation, merger or transfer and such Guaranty Agreement, if
any, complies with this Indenture.

Notwithstanding the foregoing, any Subsidiary Guarantor shall be entitled to consolidate with or
merge with or into or convey, transfer or lease, in one transaction or a series of transactions,
all or substantially all of its assets to the Company or another Subsidiary Guarantor.

          (c) Parent shall not merge with or into, or convey, transfer or lease, in one transaction or a
series of transactions, all or substantially all of its assets to any Person unless:

	 	(1)	 	the resulting, surviving or transferee Person (if not Parent) shall be a Person
organized and existing under the laws of the jurisdiction under which Parent was organized
or under the laws of the United States of America, or any State thereof or the District of
Columbia, and such Person shall expressly assume all the obligations of Parent, if any,
under the Parent Guaranty;
	 
	 	(2)	 	immediately after giving effect to such transaction or transactions on a pro forma
basis (and treating any Indebtedness which becomes an obligation of the resulting,
surviving or transferee Person as a result of such transaction as having been issued by
such Person at the time of such transaction), no Default shall have occurred and be
continuing; and
	 
	 	(3)	 	the Company delivers to the Trustee an Officers’ Certificate and an Opinion of Counsel,
each stating that such consolidation, merger or transfer and execution of such Guaranty
Agreement, if any, complies with this Indenture.

ARTICLE VI

Defaults and Remedies

          SECTION 6.01. Events of Default. An “Event of Default” with respect to all of
the Securities occurs if:

     (a) the Company defaults in any payment of interest or any Additional Interest on any
Security when the same becomes due and payable, and such default continues for a period of
30 days,

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     (b) the Company defaults in the payment of principal or premium, if any, of any
Security when due at its Stated Maturity, upon optional redemption, upon required purchase
or upon declaration or otherwise,

     (c) the Company or Parent fails to comply with its obligations under Section 5.01,

     (d) the Company fails to comply with any of its obligations under the covenants set
forth in Sections 4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.09 or 4.10 (in each case,
other than a failure to purchase Securities when required under Section 4.06 or 4.08) and
such failure continues for 30 days after the notice specified below,

     (e) the Company or a Subsidiary Guarantor fails to comply with any of its agreements in
the Securities or this Indenture (other than those referred to in (a), (b), (c), or (d)
above) and such failure continues for 60 days after the notice specified below,

     (f) the Company, any Subsidiary Guarantor or any Significant Subsidiary fails to pay
any Indebtedness within any applicable grace period after final maturity or the acceleration
of any such Indebtedness by the holders thereof because of a default, in each case, if the
total amount of such Indebtedness unpaid or accelerated exceeds $25.0 million or its foreign
currency equivalent,

     (g) the Company, any Subsidiary Guarantor or any Significant Subsidiary pursuant to or
within the meaning of any Bankruptcy Law:

   (i) commences a voluntary case;

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

   (iii) consents to the appointment of a Custodian of it or for any substantial
part of its property; or

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

or takes any comparable action under any foreign laws relating to insolvency,

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

   (i) is for relief against the Company, any Subsidiary Guarantor or any
Significant Subsidiary in an involuntary case;

   (ii) appoints a Custodian of the Company, any Subsidiary Guarantor or any
Significant Subsidiary or for any substantial part of its property; or

   (iii) orders the winding up or liquidation of the Company, any Subsidiary
Guarantor or any Significant Subsidiary;

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or any similar relief is granted under any foreign laws and the order or decree remains unstayed
and in effect for 60 days,

     (i) the Company, any Subsidiary Guarantor or any Significant Subsidiary fails to pay
final judgments aggregating in excess of $25.0 million or its foreign currency equivalent,
which judgments are not discharged, waived or stayed for a period of 60 consecutive days
following the entry thereof, and which are not discharged, waived or stayed for a period of
10 days after the notice specified below, or

     (j) the Parent Guaranty or any Subsidiary Guaranty ceases to be in full force and
effect (except as contemplated by the terms thereof or by this Indenture) and such default
continues for 10 days or any Guarantor denies or disaffirms its obligations under this
Indenture or its Guaranty.

          The foregoing shall constitute Events of Default whatever the reason for any such Event of
Default and whether it is voluntary or involuntary or is effected by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation of any
administrative or governmental body.

          The term “Bankruptcy Law” means Title 11, United States Code, or any similar Federal
or state law for the relief of debtors. The term “Custodian” means any receiver, trustee,
assignee, liquidator, custodian or similar official under any Bankruptcy Law.

          A Default under clause (d), (e) or (i) above shall not constitute an Event of Default until
the Trustee notifies the Company or the Holders of at least 25% in principal amount of the
outstanding Securities notify the Company and the Trustee of the Default and the Company does not
cure such Default within the time specified in clauses (d), (e) or (i) above after receipt of such
notice. Such notice must specify the Default, demand that it be remedied and state that such
notice is a “Notice of Default”. The Company shall deliver to the Trustee, within 30 days
after the occurrence thereof, written notice in the form of an Officers’ Certificate of any event
which is, or with the giving of notice or the lapse of time or both would become, an Event of
Default, its status and what action the Company is taking or proposes to take with respect thereto.

          SECTION 6.02. Acceleration. If an Event of Default (other than an Event of Default
specified in Section 6.01(g) or (h) with respect to the Company) occurs and is continuing, the
Trustee by notice to the Company or the Holders of at least 25% in principal amount of outstanding
Securities by notice to the Company and the Trustee, may declare the principal of, premium, if any,
and accrued but unpaid interest on all the Securities to be due and payable. Upon such a
declaration, such principal and interest shall be due and payable immediately. If an Event of
Default specified in Section 6.01(g) or (h) with respect to the Company occurs and is continuing,
the principal of, premium, if any, and interest on all the Securities shall ipso facto become and
be immediately due and payable without any declaration or other act on the part of the Trustee or
any Holders. The Holders of a majority in principal amount of the Securities by notice to the
Trustee may rescind an acceleration and its consequences if the rescission would not conflict with
any judgment or decree and if all existing Events of Default have been cured or waived except
nonpayment of principal or interest that has

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become due solely because of acceleration. No such rescission shall affect any subsequent
Default or impair any right consequent thereto.

          SECTION 6.03. Other Remedies. If an Event of Default occurs and is continuing, the
Trustee may pursue any available remedy at law or in equity to collect the payment of principal of
or interest on the Securities or to enforce the performance of any provision of the Securities or
this Indenture.

          The Trustee may maintain a proceeding even if it does not possess any of the Securities or
does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder
in exercising any right or remedy accruing upon an Event of Default shall not impair the right or
remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive
of any other remedy. All available remedies are cumulative.

          SECTION 6.04. Waiver of Past Defaults. The Holders of a majority in principal amount
of the outstanding Securities by notice to the Trustee may waive an existing Default and its
consequences except (i) a Default in the payment of the principal of or interest on a Security,
(ii) a Default arising from the failure to redeem or purchase any Security when required pursuant
to this Indenture or (iii) a Default in respect of a provision that under Section 9.02 cannot be
amended without the consent of each Holder affected. When a Default is waived, it is deemed cured
and the Company, the Trustee and the Holders will be restored to their former positions and rights
under this Indenture, but no such waiver shall extend to any subsequent or other Default or impair
any consequent right.

          SECTION 6.05. Control by Majority. The Holders of a majority in principal amount of
the Securities may direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or of exercising any trust or power conferred on the Trustee. However,
the Trustee may refuse to follow any direction that conflicts with law or this Indenture or,
subject to Section 7.01, that the Trustee determines is unduly prejudicial to the rights of any
other Holder or that would involve the Trustee in personal liability; provided,
however, that the Trustee may take any other action deemed proper by the Trustee that is
not inconsistent with such direction. Prior to taking any action under this Indenture, the Trustee
shall be entitled to indemnification satisfactory to it in its sole discretion against all losses
and expenses caused by taking or not taking such action.

          SECTION 6.06. Limitation on Suits. (a) Except to enforce the right to receive
payment of principal, premium (if any) or interest when due, no Holder may pursue any remedy with
respect to this Indenture or the Securities unless:

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

     (ii) the Holders of at least 25% in principal amount of the Securities make a
written request to the Trustee to pursue the remedy;

     (iii) such Holder or Holders offer to the Trustee reasonable security or
indemnity satisfactory to it against any loss, liability or expense;

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     (iv) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of security or indemnity; and

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

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

          SECTION 6.07. Rights of the Holders to Receive Payment. Notwithstanding any other
provision of this Indenture, the right of any Holder to receive payment of principal of and
interest on the Securities held by such Holder, on or after the respective due dates expressed or
provided for in the Securities, or to bring suit for the enforcement of any such payment on or
after such respective dates, shall not be impaired or affected without the consent of such Holder.

          SECTION 6.08. Collection Suit by Trustee. If an Event of Default specified in Section
6.01(a) or (b) occurs and is continuing, the Trustee may recover judgment in its own name and as
trustee of an express trust against the Company or any other obligor on the Securities for the
whole amount then due and owing (together with interest on overdue principal and (to the extent
lawful) on any unpaid interest at the rate provided for in the Securities) and the amounts provided
for in Section 7.07.

          SECTION 6.09. Trustee May File Proofs of Claim. The Trustee may file such proofs of
claim and other papers or documents as may be necessary or advisable in order to have the claims of
the Trustee (including any claim for reasonable compensation, expenses disbursements and advances
of the Trustee (including counsel, accountants, experts or such other professionals as the Trustee
deems necessary, advisable or appropriate)) and the Holders allowed in any judicial proceedings
relative to the Company or any Guarantor, their creditors or their property, shall be entitled to
participate as a member, voting or otherwise, of any official committee of creditors appointed in
such matters and, unless prohibited by law or applicable regulations, may vote on behalf of the
Holders in any election of a trustee in bankruptcy or other Person performing similar functions,
and any Custodian in any such judicial proceeding is hereby authorized by each Holder to make
payments to the Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents and its counsel, and
any other amounts due the Trustee under Section 7.07.

          SECTION 6.10. Priorities. If the Trustee collects any money or property pursuant to
this Article VI, it shall pay out the money or property in the following order:

          FIRST: to the Trustee for amounts due under Section 7.07;

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

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          THIRD: to the Company or, to the extent the Trustee collects any amount for any Guarantor, to
such Guarantor.

          The Trustee may fix a record date and payment date for any payment to the Holders pursuant to
this Section. At least 15 days before such record date, the Trustee shall mail to each Holder and
the Company a notice that states the record date, the payment date and amount to be paid.

          SECTION 6.11. Undertaking for Costs. In any suit for the enforcement of any right or
remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party litigant in the suit
of an undertaking to pay the costs of the suit, and the court in its discretion may assess
reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in
the suit, having due regard to the merits and good faith of the claims or defenses made by the
party litigant. This Section does not apply to a suit by the Trustee, a suit by a Holder pursuant
to Section 6.07 or a suit by Holders of more than 10% in principal amount of the Securities.

          SECTION 6.12. Waiver of Stay or Extension Laws. Neither the Company nor any Guarantor
(to the extent it may lawfully do so) shall at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the performance of this
Indenture; and the Company and each Guarantor (to the extent that it may lawfully do so) hereby
expressly waive all benefit or advantage of any such law, and shall not hinder, delay or impede the
execution of any power herein granted to the Trustee, but shall suffer and permit the execution of
every such power as though no such law had been enacted.

ARTICLE VII

Trustee

          SECTION 7.01. Duties of Trustee. (a) If an Event of Default has occurred and is
continuing, the Trustee shall exercise the rights and powers vested in it by this Indenture and use
the same degree of care and skill in their exercise as a prudent person would exercise or use under
the circumstances in the conduct of such person’s own affairs.

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

     (i) the Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture and no implied covenants or obligations shall be
read into this Indenture against the Trustee; and

     (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, in the case of certificates or opinions required
by any provision hereof to be provided to it, the Trustee shall examine the certificates and
opinions to determine whether or not they conform to the requirements of this Indenture.

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          (c) The Trustee may not be relieved from liability 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 paragraph (b) of this
Section;

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

     (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; and

     (iv) no provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur financial liability in the performance of any of its
duties hereunder or in the exercise of any of its rights or powers.

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

          (e) The Trustee shall not be liable for interest on any money received by it except as the
Trustee may agree in writing with the Company.

          (f) Money held in trust by the Trustee need not be segregated from other funds except to the
extent required by law.

          (g) Every provision of this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this Section and to the
provisions of the TIA.

          SECTION 7.02. Rights of Trustee. (a) The Trustee may conclusively rely on any
document believed by it to be genuine and to have been signed or presented by the proper person.
The Trustee need not investigate any fact or matter stated in the document.

          (b) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate
or an Opinion of Counsel. The Trustee shall not be liable for any action it takes or omits to take
in good faith in reliance on the Officers’ Certificate or Opinion of Counsel.

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

          (d) The Trustee shall not be liable for any action it takes or omits to take in good faith
which it believes to be authorized or within its rights or powers; provided,
however, that the Trustee’s conduct does not constitute willful misconduct or negligence.

          (e) The Trustee may consult with counsel of its own selection and the advice or opinion of
counsel with respect to legal matters relating to this Indenture and the Securities shall be full
and complete authorization and protection from liability in respect of any action taken,

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omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion
of such counsel.

          (f) Except with respect to Section 4.01, the Trustee shall have no duty to inquire as to the
performance of the Company with respect to the covenants contained in Article IV. In addition, the
Trustee shall not be deemed to have knowledge of an Event of Default except (i) any Default or
Event of Default occurring pursuant to Sections 4.01, 6.01(a) or 6.01(b) or (ii) any Default or
Event of Default of which the Trustee shall have received written notification or obtained actual
knowledge.

          (g) Delivery of reports, information and documents to the Trustee under Section 4.02 is for
informational purposes only and the Trustees receipt of the foregoing shall not constitute
constructive notice of any information contained therein or determinable from information contained
therein, including the Company’s compliance with any of their covenants hereunder (as to which the
Trustee is entitled to rely exclusively on Officers Certificates).

          (h) 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, consent,
order, approval, bond, debenture, note or other paper or document unless requested in writing to do
so by the Holders of not less than a majority in principal amount of the Securities at the time
outstanding, 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 expense of the Company and shall incur
no liability of any kind by reason of making or not making such inquiry or investigation.

          (i) 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 pursuant to this Indenture,
unless such Holders shall have offered to the Trustee security or indemnity satisfactory to the
Trustee against the costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction.

          (j) The rights, privileges, protections, immunities and benefits given to the Trustee,
including 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.

          SECTION 7.03. Individual Rights of Trustee. The Trustee in its individual or any
other capacity may become the owner or pledgee of Securities and may otherwise deal with the
Company or its Affiliates with the same rights it would have if it were not Trustee. Any Paying
Agent or Registrar may do the same with like rights. However, the Trustee must comply with
Sections 7.10 and 7.11.

          SECTION 7.04. Trustee’s Disclaimer. The Trustee shall not be responsible for and
makes no representation as to the validity or adequacy of this Indenture, any Guarantee or the
Securities, it shall not be accountable for the Company’s use of the proceeds from the

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Securities, and it shall not be responsible for any statement of the Company or any Guarantor
in this Indenture or in any document issued in connection with the sale of the Securities or in the
Securities other than the Trustee’s certificate of authentication. The Trustee shall not be
charged with knowledge of any Default or Event of Default under Sections 6.01(c), (d), (e), (f),
(i) or (j) or of the identity of any Significant Subsidiary unless either (a) a Trust Officer shall
have actual knowledge thereof or (b) the Trustee shall have received notice thereof in accordance
with Section 11.02 hereof from the Company, any Guarantor or any Holder.

          SECTION 7.05. Notice of Defaults. If a Default occurs and is continuing and if it is
actually known to the Trustee, the Trustee shall mail to each Holder notice of the Default within
the earlier of 90 days after it occurs or 30 days after it is actually known to a Trust Officer or
written notice of it is received by the Trustee. Except in the case of a Default in the payment of
principal of, premium (if any) or interest on any Security, the Trustee may withhold the notice if
and so long as a committee of its Trust Officers in good faith determines that withholding the
notice not opposed to the interests of the Holders.

          SECTION 7.06. Reports by Trustee to the Holders. As promptly as practicable after
each May 15 beginning with the May 15 following the date of this Indenture, and in any event prior
to July 15 in each year, the Trustee shall mail to each Holder a brief report dated as of such May
15 that complies with Section 313(a) of the TIA if and to the extent required thereby. The Trustee
shall also comply with Section 313(b) of the TIA.

          A copy of each report at the time of its mailing to the Holders shall be filed with the SEC
and each stock exchange (if any) on which the Securities are listed. The Company agrees to notify
promptly the Trustee whenever the Securities become listed on any stock exchange and of any
delisting thereof.

          SECTION 7.07. Compensation and Indemnity. The Company shall pay to the Trustee from
time to time reasonable compensation for its services. The Trustee’s compensation shall not be
limited by any law on compensation of a trustee of an express trust. The Company shall reimburse
the Trustee upon request for all reasonable out-of-pocket expenses incurred or made by it,
including costs of collection, in addition to the compensation for its services. Such expenses
shall include the reasonable compensation and expenses, disbursements and advances of the Trustee’s
agents, counsel, accountants and experts. 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. 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 reasonable fees and
expenses of such counsel; provided, however, that the Company shall not be required
to pay such fees and expenses if it assumes such indemnified parties’ defense and, in such
indemnified parties’ reasonable judgment, there is no conflict of interest between the Company and
the Guarantors, as applicable, and such parties in connection with such defense. The

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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.

          The Company’s and the Guarantors’ payment obligations pursuant to this Section shall survive
the satisfaction or discharge of this Indenture, any rejection or termination of this Indenture
under any bankruptcy law or the resignation or removal of the Trustee. Without prejudice to any
other rights available to the Trustee under applicable law, when the Trustee incurs expenses after
the occurrence of a Default specified in Section 6.01(g) or (h) with respect to the Company, the
expenses are intended to constitute expenses of administration under the Bankruptcy Law.

          SECTION 7.08. Replacement of Trustee. (a) The Trustee may resign at any time by so
notifying the Company. The Holders of a majority in principal amount of the Securities may remove
the Trustee by so notifying the Trustee and may appoint a successor Trustee. The Company shall
remove the Trustee if:

     (i) the Trustee fails to comply with Section 7.10;

     (ii) the Trustee is adjudged bankrupt or insolvent;

     (iii) a receiver or other public officer takes charge of the Trustee or its
property; or

     (iv) the Trustee otherwise becomes incapable of acting.

          (b) If the Trustee resigns, is removed by the Company or by the Holders of a majority in
principal amount of the Securities and such Holders do not reasonably promptly appoint a successor
Trustee, or if a vacancy exists in the office of Trustee for any reason (the Trustee in such event
being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor
Trustee.

          (c) 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 the
Holders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the
successor Trustee, subject to the Lien provided for in Section 7.07.

          (d) If a successor Trustee does not take office within 60 days after the retiring Trustee
resigns or is removed, the retiring Trustee or the Holders of 10% in principal amount of the
Securities may petition any court of competent jurisdiction for the appointment of a successor
Trustee.

          (e) If the Trustee fails to comply with Section 7.10, unless the Trustee’s duty to resign is
stayed as provided in Section 310(b) of the TIA, any Holder who has been a bona fide holder of a
Security for at least six months may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.

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          (f) Notwithstanding the replacement of the Trustee pursuant to this Section, the Company’s
obligations under Section 7.07 shall continue for the benefit of the retiring Trustee.

          SECTION 7.09. Successor Trustee by Merger. If the Trustee consolidates with, merges
or converts into, or transfers all or substantially all its corporate trust business or assets to,
another corporation or banking association, the resulting, surviving or transferee corporation
without any further act shall be the successor Trustee.

          In case at the time such successor or successors by merger, conversion or consolidation to the
Trustee shall succeed to the trusts created by this Indenture any of the Securities shall have been
authenticated but not delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Securities so authenticated; and in
case at that time any of the Securities shall not have been authenticated, any successor to the
Trustee may authenticate such Securities either in the name of any predecessor hereunder or in the
name of the successor to the Trustee; and in all such cases such certificates shall have the full
force which it is anywhere in the Securities or in this Indenture provided that the certificate of
the Trustee shall have.

          SECTION 7.10. Eligibility; Disqualification. The Trustee shall at all times satisfy
the requirements of Section 310(a) of the TIA. The Trustee shall have a combined capital and
surplus of at least $100,000,000 as set forth in its most recent published annual report of
condition. The Trustee shall comply with Section 310(b) of the TIA, subject to its right to apply
for a stay of its duty to resign under the penultimate paragraph of Section 310(b) of the TIA;
provided, however, that there shall be excluded from the operation of Section
310(b)(1) of the TIA any securities issued under this Indenture and any indenture or indentures
under which other securities or certificates of interest or participation in other securities of
the Company are outstanding if the requirements for such exclusion set forth in Section 310(b)(1)
of the TIA are met.

          SECTION 7.11. Preferential Collection of Claims Against Company. The Trustee shall
comply with Section 311(a) of the TIA, excluding any creditor relationship listed in Section 311(b)
of the TIA. A Trustee who has resigned or been removed shall be subject to Section 311(a) of the
TIA to the extent indicated.

ARTICLE VIII

Discharge of Indenture; Defeasance

          SECTION 8.01. Discharge of Liability on Securities; Defeasance. (a) This Indenture
shall be discharged and shall cease to be of further effect (except as to surviving rights of
registration of transfer or exchange of Securities, as expressly provided for in this Indenture) as
to all outstanding Securities and their obligations under this Indenture with respect to the
Holders of the Securities:

     (i) when (1) all the Securities theretofore authenticated and delivered
(other than Securities pursuant to Section 2.08 which have been replaced or paid and
Securities for whose payment money has theretofore been deposited in trust or segregated and
held in

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trust by the Company and thereafter repaid to the Company or discharged from such
trust) have been delivered to the Trustee for cancellation or (2) all of the Securities (a)
have become due and payable, (b) will become due and payable at their stated maturity within
one year or (c) if redeemable at the option of the Company, are to be called for redemption
within one year under arrangements reasonably satisfactory to the Trustee for the giving of
notice of redemption by the Trustee in the name, and at the expense, of the Company, and in
the case of clause (2) the Company has irrevocably deposited or caused to be deposited with
the Trustee funds in respect of the Securities, cash in U.S. Dollars, U.S. Government
Obligations or a combination thereof in an amount sufficient to pay and discharge the entire
Indebtedness on the Securities not theretofore delivered to the Trustee for cancellation,
for principal of, premium, if any, and interest on the Securities 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 or the Guarantors have paid all other sums payable under
this Indenture; 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.

          (b) Subject to Sections 8.01(c) and 8.02, the Company at any time may terminate (i) all of its
obligations under the Securities and this Indenture with respect to the Securities (“legal
defeasance option”) or (ii) its obligations under Sections 4.02, 4.03, 4.04, 4.05, 4.06, 4.07,
4.08, 4.09 and 4.10 and the operation of Section 5.01(a)(3) and Sections 6.01(d), 6.01(f), 6.01(g)
(with respect to Significant Subsidiaries and Subsidiary Guarantors only), 6.01(h) (with respect to
Significant Subsidiaries and Subsidiary Guarantors only), 6.01(i) (with respect to Significant
Subsidiaries and Subsidiary Guarantors only) and 6.01(j) (“covenant defeasance option”).
The Company may exercise its legal defeasance option notwithstanding its prior exercise of its
covenant defeasance option. In the event that the Company terminates all of its obligations under
the Securities and this Indenture by exercising its legal defeasance option or its covenant
defeasance option, the obligations of each Guarantor under its Guarantee of the Securities shall
be terminated simultaneously with the termination of such obligations.

          If the Company exercises its legal defeasance option, payment of the Securities may not be
accelerated because of an Event of Default. If the Company exercises its covenant defeasance
option, payment of the Securities may not be accelerated because of an Event of Default specified
in Section 6.01(d), 6.01(f), 6.01(g) (with respect to Significant Subsidiaries and Subsidiary
Guarantors only), 6.01(h) (with respect to Significant Subsidiaries and Subsidiary Guarantors
only), 6.01(i) (with respect to Significant Subsidiaries and Subsidiary Guarantors only) and
6.01(j) or because of the failure of the Company to comply with Section 5.01(a)(iii).

          Upon satisfaction of the conditions set forth herein and upon request of the Company, the
Trustee shall acknowledge in writing the discharge of those obligations that the Company
terminates.

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          (c) Notwithstanding clauses (a) and (b) above, the Company’s obligations in Sections 2.04,
2.05, 2.06, 2.07, 2.08, 7.07, 7.08 and in this Article VIII shall survive until all the Securities
have been paid in full. Thereafter, the Company’s obligations in Sections 7.07, 8.04 and 8.05
shall survive such satisfaction and discharge.

          SECTION 8.02. Conditions to Defeasance. (a) The Company may exercise its legal
defeasance option or its covenant defeasance option only if:

     (i) the Company irrevocably deposits in trust with the Trustee in respect of
cash in U.S. Dollars, U.S. Government Obligations or a combination thereof in an amount
sufficient or U.S. Government Obligations, the principal of and the interest on which will
be sufficient, or a combination thereof sufficient, to pay the principal of, and premium (if
any) and interest on the Securities when due at maturity or redemption, as the case may be,
including interest thereon to maturity or such redemption date;

     (ii) the Company delivers to the Trustee a certificate from a nationally
recognized firm of independent accountants or other nationally recognized firm of financial
experts expressing their opinion that the payments of principal and interest when due and
without reinvestment on the deposited U.S. Government Obligations plus any deposited money
without investment will provide cash at such times and in such amounts as will be sufficient
to pay principal, premium, if any, and interest when due on all the Securities to maturity
or redemption, as the case may be;

     (iii) 123 days pass after the deposit is made and during the 123-day period
no Default specified in Section 6.01(g) or (h) with respect to the Company occurs which is
continuing at the end of the period;

     (iv) the deposit does not constitute a default under any other material
agreement binding on the Company and its Restricted Subsidiaries;

     (v) in the case of the legal defeasance option, the Company shall have
delivered to the Trustee an Opinion of Counsel stating that (1) the Company has received
from, or there has been published by, the Internal Revenue Service a ruling, or (2) 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 will not recognize income, gain or loss for Federal income tax purposes as
a result of such deposit and 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
deposit and defeasance had not occurred. Notwithstanding the foregoing, the Opinion of
Counsel required with respect to a legal defeasance need not be delivered if all the
Securities not theretofore delivered to the Trustee for cancellation have become due and
payable;

     (vi) in the case of the covenant defeasance option, the Company shall have
delivered to the Trustee an Opinion of Counsel to the effect that the Holders will not
recognize income, gain or loss for Federal income tax purposes as a result of such deposit
and defeasance and will be subject to Federal income tax on the same amounts, in the

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same manner and at the same times as would have been the case if such deposit and
defeasance had not occurred; and

     (vii) the Company delivers to the Trustee an Officers’ Certificate and an
Opinion of Counsel, each stating that all conditions precedent to the defeasance and
discharge of the Securities to be so defeased and discharged as contemplated by this Article
VIII have been complied with.

          (b) Before or after a deposit, the Company may make arrangements reasonably satisfactory to
the Trustee for the redemption of such Securities at a future date in accordance with Article III.

          SECTION 8.03. Application of Trust Money. The Trustee shall hold in trust money or
Government Obligations (including proceeds thereof) deposited with it pursuant to this Article
VIII. It shall apply the deposited money and the money from U.S. Government Obligations through
each Paying Agent and in accordance with this Indenture to the payment of principal of and interest
on the Securities so discharged or defeased.

          SECTION 8.04. Repayment to the Company. Each of the Trustee and each Paying Agent
shall promptly turn over to the Company upon request any excess money or securities held by them at
any time.

          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.

          SECTION 8.05. Indemnity for Government Obligations. The Company shall pay and shall
indemnify the Trustee against any tax, fee or other charge imposed on or assessed against deposited
U.S. Government Obligations or the principal and interest received on such U.S. Government
Obligations.

          SECTION 8.06. Reinstatement. If the Trustee or any Paying Agent is unable to apply
any money or U.S. Government Obligations in accordance with this Article VIII by reason of any
legal proceeding or by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, the Company’s and the Guarantors’
obligations under this Indenture and the Securities so discharged or defeased shall be revived and
reinstated as though no deposit had occurred pursuant to this Article VIII until such time as the
Trustee or any Paying Agent is permitted to apply all such money or U.S. Government Obligations in
accordance with this Article VIII; provided, however, that, if the Company has made
any payment of principal of or interest on any such Securities because of the reinstatement of its
obligations, the Company shall be subrogated to the rights of the Holders of such Securities to
receive such payment from the money or U.S. Government Obligations held by the Trustee or any
Paying Agent.

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ARTICLE IX

Amendments and Waivers

          SECTION 9.01. Without Consent of the Holders. The Company, the Guarantors and the
Trustee shall be entitled to amend this Indenture and the Securities without notice to or consent
of any Holder:

     (i) to cure any ambiguity, omission, defect, mistake or inconsistency;

     (ii) to comply with Article V;

     (iii) to provide for uncertificated Securities in addition to or in place of
certificated Securities; provided, however, that the uncertificated
Securities are issued in registered form for purposes of Section 163(f) of the Code or in a
manner such that the uncertificated Securities are described in Section 163(f)(2)(B) of the
Code;

     (iv) to add additional Guarantees with respect to the Securities or to secure
the Securities;

     (v)
to add to the covenants of Parent, the Company or any Subsidiary
Guarantor for the benefit of the Holders or to surrender any right or power herein conferred
upon the Company or any Subsidiary Guarantor;

     (vi) to comply with any requirement of the SEC in connection with qualifying
or maintaining the qualification of, this Indenture under the TIA;

     (vii) to make any change that does not adversely affect the rights of any
Holder;

     (viii) to conform the text of this Indenture, the Securities, the Parent
Guaranty and the Subsidiary Guaranties to any provision under the heading “Description of
the Notes” in the Offering Circular to the extent that such provision was intended to be a
verbatim recitation of a provision of this Indenture, the Securities, the Parent Guaranty or
the Subsidiary Guaranties;or

     (ix) to make any amendment to the provisions of this Indenture (including the
Appendix) relating to the transfer and legending of Securities; provided,
however, that (a) compliance with this Indenture as so amended would not result in
Securities being transferred in violation of the Securities Act or any other applicable
securities law and (b) such amendment does not materially and adversely affect the rights of
holders to transfer Securities.

          After an amendment under this Section 9.01 becomes effective, the Company shall mail to
Holders a notice briefly describing such amendment. The failure to give such notice to all
Holders, or any defect therein, shall not impair or affect the validity of an amendment under this
Section 9.01.

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          SECTION 9.02. With Consent of the Holders. (a) The Company, the Guarantors and the
Trustee shall be entitled to amend this Indenture and the Securities with the written consent of
the Holders of at least a majority in principal amount of the Securities then outstanding
(including consents obtained in connection with a tender offer or exchange for the Securities) and
any past default or compliance with any provisions may be waived with the consent of the holders of
a majority in principal amount of the Securities then outstanding (including consents obtained in
connection with a tender offer or exchange for the Securities). However, without the consent of
each Holder affected thereby, an amendment may not:

     (i) reduce the principal amount of Securities whose Holders must consent to
an amendment,

     (ii) reduce the rate of or extend the time for payment of interest on any
Security,

     (iii) reduce the principal of or change the Stated Maturity of any Security,

     (iv) reduce the amount payable upon the redemption of any Security or change
the time when any Security may be redeemed in accordance with Article III,

     (v) make any Security payable in money other than that stated in such
Security,

     (vi) make any change in Section 6.07 or the second sentence of this Section
9.02,

     (vii) impair the right of any holder to receive payment of principal of,
premium, if any, and interest on such holder’s Securities on or after the due dates therefor
or to institute suit for the enforcement of any payment on or with respect to such holder’s
Securities,

     (viii) make any change in the ranking or priority of any Security or any
Guaranty that would adversely affect the Securityholders, or

     (ix) modify the Guarantees in any manner that would adversely affect the
Holders in any material respect.

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

          (b) After an amendment under this Section 9.02 becomes effective, the Company shall mail to
the Holders a notice briefly describing such amendment. The failure to give such notice to all
Holders, or any defect therein, shall not impair or affect the validity of an amendment under this
Section 9.02.

          SECTION 9.03. Compliance with Trust Indenture Act. From the date on which this
Indenture is qualified under the TIA, every amendment, waiver or supplement to this Indenture or
the Securities shall comply with the TIA as then in effect.

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          SECTION 9.04. Revocation and Effect of Consents and Waivers. (a) A consent to an
amendment or a waiver by a Holder of a Security shall bind the Holder and every subsequent Holder
of that Security or portion of the Security that evidences the same debt as the consenting Holder’s
Security, even if notation of the consent or waiver is not made on the Security. However, any such
Holder or subsequent Holder may revoke the consent or waiver as to such Holder’s Security or
portion of the Security if the Trustee receives the notice of revocation before the date on which
the Trustee receives an Officers’ Certificate from the Company certifying that the requisite
principal amount of Securities have consented. After an amendment or waiver becomes effective, it
shall bind every Holder. An amendment or waiver becomes effective upon the (i) receipt by the
Company or the Trustee of consents by the Holders of the requisite principal amount of securities,
(ii) satisfaction of conditions to effectiveness as set forth in this Indenture and any indenture
supplemental hereto containing such amendment or waiver and (iii) execution of such amendment or
waiver (or supplemental indenture) by the Company and the Trustee.

          (b) The Company may, but shall not be obligated to, fix a record date for the purpose of
determining the Holders entitled to give their consent or take any other action described above or
required or permitted to be taken pursuant to this Indenture. If a record date is fixed, then
notwithstanding the immediately preceding paragraph, those Persons who were Holders at such record
date (or their duly designated proxies), and only those Persons, shall be entitled to give such
consent or to revoke any consent previously given or to take any such action, whether or not such
Persons continue to be Holders after such record date. No such consent shall be valid or effective
for more than 120 days after such record date.

          SECTION 9.05. Notation on or Exchange of Securities. If an amendment, supplement or
waiver changes the terms of a Security, the Company may require the Holder of the Security to
deliver it to the Trustee. The Trustee may place an appropriate notation on the Security regarding
the changed terms and return it to the Holder. Alternatively, if the Company or the Trustee so
determines, the Company in exchange for the Security shall issue and the Trustee shall authenticate
a new Security that reflects the changed terms. Failure to make the appropriate notation or to
issue a new Security shall not affect the validity of such amendment, supplement or waiver.

          SECTION 9.06. Trustee to Sign Amendments. The Trustee shall sign any amendment,
supplement or waiver authorized pursuant to this Article IX if the amendment does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. If it does, the Trustee may
but need not sign it. In signing such amendment, the Trustee shall be entitled to receive
indemnity reasonably satisfactory to it and shall be provided with, and (subject to Section 7.01)
shall be fully protected in relying upon, an Officers’ Certificate and an Opinion of Counsel
stating that such amendment, supplement or waiver is authorized or permitted by this Indenture.

          SECTION 9.07. Payment for Consent. Neither the Company nor any Affiliate of the
Company shall, directly or indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder for or as an inducement to any consent, waiver or
amendment of any of the terms or provisions of this Indenture or the Securities unless such
consideration either (i) is offered to be paid to all Holders that so consent, waive or agree to

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amend in the time frame set forth in solicitation documents relating to such consent, waiver
or agreement or (ii) is paid to all Holders.

ARTICLE X

Guarantees

          SECTION 10.01. Guarantees. (a) Each Guarantor hereby jointly and severally,
irrevocably and unconditionally guarantees, as a primary obligor and not merely as a surety on a
senior basis, to each Holder and to the Trustee and its successors and assigns (i) the full and
punctual payment when due, whether at Stated Maturity, by acceleration, by redemption or otherwise,
of all obligations of the Company under this Indenture (including obligations to the Trustee) and
the Securities, whether for payment of principal of, premium, if any, or interest on in respect of
the Securities and all other monetary obligations of the Company under this Indenture and the
Securities and (ii) the full and punctual performance within applicable grace periods of all other
obligations of the Company whether for fees, expenses, indemnification or otherwise under this
Indenture and the Securities (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 shall remain bound under this Article X notwithstanding any
extension or renewal of any Guaranteed Obligation.

          (b) 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 Securities or the Guaranteed Obligations. The
obligations of each Guarantor hereunder shall not be affected by (i) 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 Securities or any other agreement or otherwise; (ii) any
extension or renewal of this Indenture, the Securities or any other agreement; (iii) any
rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture,
the Securities or any other agreement; (iv) the release of any security held by any Holder or the
Trustee for the Guaranteed Obligations or any Guarantor; (v) the failure of any Holder or Trustee
to exercise any right or remedy against any other guarantor of the Guaranteed Obligations; or (vi)
any change in the ownership of such Guarantor, except as provided in Section 10.02(b).

          (c) 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 or any other Guarantor 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.

          (d) Each Guarantor further agrees that its Guarantee herein constitutes a guarantee of
payment, performance and compliance when due (and not a guarantee of collection)

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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.

          (e) Except as expressly set forth in Sections 8.01(b) and 10.02, 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
Securities 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 any Guarantor or would otherwise operate as a discharge of any
Guarantor as a matter of law or equity.

          (f) Each Guarantor agrees that its Guarantee shall remain in full force and effect until
payment in full of all the Guaranteed Obligations. 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.

          (g) 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 (i) the unpaid principal amount of such
Guaranteed Obligations, (ii) accrued and unpaid interest on such Guaranteed Obligations (but only
to the extent not prohibited by applicable law) and (iii) all other monetary obligations of the
Company to the Holders and the Trustee.

          (h) 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. Each Guarantor further agrees that, as between it, on the one
hand, and the Holders and the Trustee, on the other hand, (i) the maturity of the Guaranteed
Obligations guaranteed hereby may be accelerated as provided in Article VI for the purposes of any
Guarantee herein, notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the Guaranteed Obligations guaranteed hereby, and (ii) in the event of
any declaration of acceleration of such Guaranteed Obligations as provided in Article VI, such
Guaranteed Obligations (whether or not due and payable) shall forthwith become due and payable by
such Guarantor for the purposes of this Section 10.01.

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          (i) Each Guarantor also agrees to pay any and all reasonable costs and expenses (including
reasonable attorneys’ fees and expenses) incurred by the Trustee or any Holder in enforcing any
rights under this Section 10.01.

          (j) Upon request of the Trustee, 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 10.02. Limitation on Liability. (a) Any term or provision of this Indenture
to the contrary notwithstanding, the maximum aggregate amount of the Guaranteed 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 laws relating to fraudulent conveyance or fraudulent transfer or similar laws affecting
the rights of creditors generally.

          (b) A Guarantee of a Subsidiary Guarantor shall terminate and be of no further force or effect
and such Subsidiary Guarantor shall be deemed to be released from all obligations under this
Article X upon:

     (i) the sale, disposition or other transfer (including through merger or
consolidation) of a Subsidiary Guarantor or of all or substantially all the assets, of the
applicable Subsidiary Guarantor if such sale, disposition or other transfer is made in
compliance with this Indenture, in each case other than to the Company or a Subsidiary of
the Company;

     (ii) any sale, disposition or other transfer (including by way of merger or
consolidation) following which the applicable Subsidiary Guarantor is no longer a Restricted
Subsidiary; provided, however, that such Guarantor is released from its guarantees, if any,
of, and all pledges and security, if any, granted in connection with, the Credit Agreement;

     (iii) the Company designating such Subsidiary Guarantor to be an Unrestricted
Subsidiary in accordance with the provisions set forth under Section 4.04 and the definition
of “Unrestricted Subsidiary”;

     (iv) such time as such Subsidiary Guarantor no longer Guarantees any other
Indebtedness of the Company or another Subsidiary Guarantor that would have required it to
guarantee the Securities under Section 4.10;

     (v) the exercise by the Company of the legal defeasance option or covenant
defeasance option in Section 8.01 or if the Company’s obligations under this Indenture are
discharged in accordance with the terms of this Indenture; and

          (c) the Parent Guaranty shall terminate and be of no further force or effect and the Parent
Guarantor shall be deemed to be released from all obligations under this Article X upon the
exercise by the Company of the legal defeasance option or covenant defeasance option in Section
8.01 or if the Company’s obligations under this Indenture are discharged in accordance with the
terms of this Indenture.

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          SECTION 10.03. Successors and Assigns. This Article X shall be binding upon each
Guarantor and its successors and assigns and shall enure 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 Securities shall automatically extend to and be vested in such transferee or assignee,
all subject to the terms and conditions of this Indenture.

          SECTION 10.04. 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 X 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 X at law, in equity, by
statute or otherwise.

          SECTION 10.05. Modification. No modification, amendment or waiver of any provision of
this Article X, 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 10.06. Execution of Supplemental Indenture for Future Guarantors. Each Person
that is required to become a Guarantor after the Issue Date pursuant to Section 4.10 shall promptly
execute and deliver to the Trustee a supplemental indenture in the form of Appendix B hereto
pursuant to which such Person shall become a Guarantor under this Article X and shall guarantee the
Guaranteed Obligations.

ARTICLE XI

Miscellaneous

          SECTION 11.01. Trust Indenture Act Controls. If and to the extent that any provision
of this Indenture limits, qualifies or conflicts with the duties imposed by, or with another
provision (an “incorporated provision”) included in this Indenture by operation of,
Sections 310 to 318 of the TIA, inclusive, such imposed duties or incorporated provision shall
control.

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          SECTION 11.02. Notices. (a) Any notice or communication required or permitted
hereunder shall be in writing and delivered in person, via facsimile or mailed by first-class mail
addressed as follows:

if to the Company or a Guarantor:

Buffets, Inc

1460 Buffet Way

Eagan, MN 55121

Attention of: General Counsel

if to the Trustee:

U.S. Bank National Association

180 East Fifth Street, Suite 200

St. Paul, Minnesota

Attention of: Corporate Trust Services

The Company or the Trustee by notice to the other may designate additional or different addresses
for subsequent notices or communications.

          (b) Any notice or communication mailed to a Holder shall be mailed, first class mail, to the
Holder at the Holder’s address as it appears on the registration books of the Registrar and shall
be sufficiently given if so mailed within the time prescribed.

          (c) 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. If a notice or communication is mailed in the
manner provided above, it is duly given, whether or not the addressee receives it, except that
notices to the Trustee are effective only if received.

          SECTION 11.03. Communication by the Holders with Other Holders. The Holders may
communicate pursuant to Section 312(b) of the TIA with other Holders with respect to their rights
under this Indenture or the Securities. The Company, the Trustee, the Registrar and other Persons
shall have the protection of Section 312(c) of the TIA.

          SECTION 11.04. Certificate and Opinion as to Conditions Precedent. Upon any request
or application by the Company to the Trustee to take or refrain from taking any action under this
Indenture, the Company shall furnish to the Trustee at the request of the Trustee:

     (a) an Officers’ Certificate in form reasonably satisfactory to the Trustee stating
that, in the opinion of the signers, all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with; and

     (b) an Opinion of Counsel in form reasonably satisfactory to the Trustee stating that,
in the opinion of such counsel, all such conditions precedent have been complied with.

-76-

 

          SECTION 11.05. Statements Required in Certificate or Opinion. Each certificate or
opinion with respect to compliance with a covenant or condition provided for in this Indenture
(other than pursuant to Section 4.11) shall include:

     (a) a statement that the individual 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 individual, he has made such examination
or investigation as is necessary to enable him to express an informed opinion as to whether
or not such covenant or condition has been complied with; and

     (d) a statement as to whether or not, in the opinion of such individual, such covenant
or condition has been complied with; provided, however, that with respect to
matters of fact an Opinion of Counsel may rely on an Officers’ Certificate or certificates
of public officials.

          SECTION 11.06. When Securities Disregarded. In determining whether the Holders of the
required principal amount of Securities have concurred in any direction, waiver or consent,
Securities owned by the Company, any Guarantor or by any Person directly or indirectly controlling
or controlled by or under direct or indirect common control with the Company or any Guarantor shall
be disregarded and deemed not to be outstanding, except that, for the purpose of determining
whether the Trustee shall be protected in relying on any such direction, waiver or consent, only
Securities which the Trustee knows are so owned shall be so disregarded. Subject to the foregoing,
only Securities outstanding at the time shall be considered in any such determination.

          SECTION 11.07. Rules by Trustee, Paying Agent and Registrar. The Trustee may make
reasonable rules for action by or a meeting of the Holders. The Registrar and a Paying Agent may
make reasonable rules for their functions.

          SECTION 11.08. Legal Holidays. If a payment date is not a Business Day, payment shall
be made on the next succeeding day that is a Business Day, and no interest shall accrue on any
amount that would have been otherwise payable on such payment date if it were a Business Day for
the intervening period. If a regular record date is not a Business Day, the record date shall not
be affected.

          SECTION 11.09. GOVERNING LAW. THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

          SECTION 11.10. No Recourse Against Others. No affiliate, director, officer, employee,
incorporator or holder of any equity interests in the Company or of any Guarantor or any direct or
indirect parent corporation of the Company, as such, shall have any liability for any obligations
of the Company or the Guarantors under the Securities or this Indenture or for any claim based on,
in respect of, or by reason of, such obligations or their creation; provided,

-77-

 

however, the foregoing will not affect or limit any liability of any Guarantor under
this Indenture or its Guarantee. Each Holder of Securities by accepting a Security waives and
releases all such liability. The waiver and release shall be part of the consideration for the
issue of the Securities.

          SECTION 11.11. Successors. All agreements of the Company and each Guarantor in this
Indenture and the Securities shall bind its successors. All agreements of the Trustee in this
Indenture shall bind its successors.

          SECTION 11.12. Multiple Originals. The parties may sign any number of copies of this
Indenture. Each signed copy shall be an original, but all of them together represent the same
agreement. One signed copy is enough to prove this Indenture.

          SECTION 11.13. Table of Contents; Headings. The table of contents, cross-reference
sheet and headings of the Articles and Sections of this Indenture have been inserted for
convenience of reference only, are not intended to be considered a part hereof and shall not modify
or restrict any of the terms or provisions hereof.

          SECTION 11.14. Indenture Controls. If and to the extent that any provision of the
Securities limits, qualifies or conflicts with a provision of this Indenture, such provision of
this Indenture shall control.

          SECTION 11.15. Severability. In case any provision in this Indenture 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 and such provision shall be
ineffective only to the extent of such invalidity, illegality or unenforceability.

-78-

 

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

BUFFETS, INC.,

	 	 	 	 	 	 	 
	 

	 	by:
	 	/s/ H. Thomas Mitchell	 	 
	 

	 	 	 	 

Name: H. Thomas Mitchell
	 	 
	 

	 	 	 	Title: Secretary	 	 

S-1

 

BUFFETS HOLDINGS, INC.,

	 	 	 	 	 	 	 
	 

	 	by:
	 	/s/ H. Thomas Mitchell	 	 
	 

	 	 	 	 

Name: H. Thomas Mitchell
	 	 
	 

	 	 	 	Title: Secretary	 	 

S-2

 

BUFFETS LEASING COMPANY, LLC,

	 	 	 	 	 	 	 
	 

	 	by:
	 	/s/ H. Thomas Mitchell	 	 
	 

	 	 	 	 

Name: H. Thomas Mitchell
	 	 
	 

	 	 	 	Title: Secretary	 	 

S-3

 

HOME TOWN BUFFET, INC.,

	 	 	 	 	 	 	 
	 

	 	by:
	 	/s/ H. Thomas Mitchell	 	 
	 

	 	 	 	 

Name: H. Thomas Mitchell
	 	 
	 

	 	 	 	Title: Secretary	 	 

S-4

 

HOMETOWN LEASING COMPANY, LLC.,

	 	 	 	 	 	 	 
	 

	 	by:
	 	/s/ H. Thomas Mitchell	 	 
	 

	 	 	 	 

Name: H. Thomas Mitchell
	 	 
	 

	 	 	 	Title: Secretary	 	 

S-5

 

OCB RESTAURANT COMPANY, LLC,

	 	 	 	 	 	 	 
	 

	 	by:
	 	/s/ H. Thomas Mitchell	 	 
	 

	 	 	 	 

Name: H. Thomas Mitchell
	 	 
	 

	 	 	 	Title: Secretary	 	 

S-6

 

OCB PURCHASING CO.,

	 	 	 	 	 	 	 
	 

	 	by:
	 	/s/ H. Thomas Mitchell	 	 
	 

	 	 	 	 

Name: H. Thomas Mitchell
	 	 
	 

	 	 	 	Title: Secretary	 	 

S-7

 

OCB LEASING COMPANY, LLC,

	 	 	 	 	 	 	 
	 

	 	by:
	 	/s/ H. Thomas Mitchell	 	 
	 

	 	 	 	 

Name: H. Thomas Mitchell
	 	 
	 

	 	 	 	Title: Secretary	 	 

S-8

 

TAHOE JOE’S LEASING COMPANY, LLC,

	 	 	 	 	 	 	 
	 

	 	by:
	 	/s/ Jason A. Greff	 	 
	 

	 	 	 	 

Name: Jason A. Greff
	 	 
	 

	 	 	 	Title: Secretary	 	 

S-9

 

TAHOE JOE’S, INC.,

	 	 	 	 	 	 	 
	 

	 	by:
	 	/s/ Jason A. Greff	 	 
	 

	 	 	 	 

Name: Jason A. Greff
	 	 
	 

	 	 	 	Title: Secretary	 	 

S-10

 

U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE

	 	 	 	 	 	 	 
	 

	 	by:
	 	/s/ Richard Prokosch	 	 
	 

	 	 	 	 

Name: Richard Prokosch
	 	 
	 

	 	 	 	Title: Vice President	 	 

S-11

 

APPENDIX A

Rule 144A/ Regulation S/ IAI Appendix

PROVISIONS RELATING TO INITIAL SECURITIES,

PRIVATE EXCHANGE SECURITIES AND EXCHANGE SECURITIES

     1. Definitions

     1.1 Definitions

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

          “Additional Interest” has the meaning given to such term in the Registration Rights Agreement.

          “Applicable Procedures” means, with respect to any transfer or transaction involving a
Temporary Regulation S Global Security or beneficial interest therein, the rules and procedures of
the Depository for such a Temporary Regulation S Global Security, to the extent applicable to such
transaction and as in effect from time to time.

          “Definitive Security” means a certificated Initial Security or Exchange Security or Private
Exchange Security bearing, if required, the appropriate restricted Securities legend set forth in
Section 2.3(e).

          “Depository” means The Depository Trust Company, its nominees and their respective successors.

          “Distribution Compliance Period”, with respect to any Securities, means the period of 40
consecutive days beginning on and including the later of (i) the day on which such Securities are
first offered to Persons other than distributors (as defined in Regulation S under the Securities
Act) in reliance on Regulation S and (ii) the issue date with respect to such Securities.

          “Exchange Securities” means the Securities issued pursuant to the Indenture in connection with
the Registered Exchange Offer pursuant to the Registration Rights Agreement.

          “IAI” means an institutional “accredited investor”, as defined in Rule 501(a)(1), (2), (3) and
(7) of Regulation D under the Securities Act.

          “Initial Purchasers” means (a) with respect to the Initial Securities issued on the Issue
Date, Credit Suisse Securities (USA) LLC, UBS Securities LLC, Goldman Sachs & Co. and Piper Jaffrey
and Co. and (b) with respect to each issuance of Additional Securities, the Persons purchasing or
underwriting such Additional Securities under the related Purchase Agreement.

 

 

2

          “Initial Securities” means the initial $300,000,000 in aggregate principal amount of
Securities, issued on the Issue Date.

          “Private Exchange” means the offer by the Company, pursuant to the Registration Rights
Agreement, to the Initial Purchasers to issue and deliver to each such Initial Purchaser, in
exchange for the Initial Securities or Additional Securities held by such Initial Purchaser as part
of the initial distribution of such Initial Securities or Additional Securities, a like aggregate
principal amount of Private Exchange Securities.

          “Private Exchange Securities” means any Securities issued in connection with a Private
Exchange.

          “Purchase Agreement” means (a) with respect to the Initial Securities issued on the Issue
Date, the Purchase Agreement dated October 19, 2006, among the Company, the Guarantors and the
Initial Purchasers and (b) with respect to each issuance of Additional Securities, the purchase
agreement or underwriting agreement among the Company, the Guarantors and the Persons purchasing or
underwriting such Additional Securities.

          “QIB” means a “qualified institutional buyer” as defined in Rule 144A.

          “Registration Default” has the meaning given to such term in the Registration Rights
Agreement.

          “Registered Exchange Offer” means the offer by the Company, pursuant to a Registration Rights
Agreement, to certain Holders of Initial Securities or Additional Securities, to issue and deliver
to such Holders, in exchange for the Initial Securities or Additional Securities, a like aggregate
principal amount of Exchange Securities registered under the Securities Act.

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

          “Securities” means the Company’s 12 1/2% Senior Notes due 2014 (including the Initial
Securities, the Exchange Securities and the Private Exchange Securities, treated as a single
class).

          “Securities Act” means the Securities Act of 1933.

          “Securities Custodian” means the custodian with respect to a Global Security (as appointed by
the Depository), or any successor Person thereto, and shall initially be the Trustee.

          “Shelf Registration Statement” means the registration statement issued by the Company in
connection with the offer and sale of Initial Securities or Additional Securities or Private
Exchange Securities pursuant to the Registration Rights Agreement.

 

3

          “Transfer Restricted Securities” means Securities that bear or are required to bear a legend
relating to restrictions on transfer relating to the Securities Act set forth in Section 2.3(e).

     1.2 Other Definitions

	 	 	 
	 	 	Defined in
	Term	 	Section:
	“Agent Members”
	 	2.1(b)
	“Global Security”
	 	2.1(a)
	“IAI Global Security”
	 	2.1(a)
	“Permanent Regulation S Global Security”
	 	2.1(a)
	“Regulation S”
	 	2.1(a)
	“Rule 144A”
	 	2.1(a)
	“Rule 144A Global Security”
	 	2.1(a)
	“Temporary Regulation S Global Security”
	 	2.1(a)

2. The Securities

     2.1 (a) Form and Dating. The Initial Securities will be offered and sold by the
Company pursuant to the Purchase Agreement. The Initial Securities will be resold initially only
to (i) QIBs in reliance on Rule 144A under the Securities Act (“Rule 144A”) and (ii)
Persons other than U.S. Persons (as defined in Regulation S) in reliance on Regulation S under the
Securities Act (“Regulation S”). Initial Securities may thereafter be transferred to,
among others, QIBs, IAIs and purchasers in reliance on Regulation S, subject to the restrictions on
transfer set forth herein. Initial Securities initially resold pursuant to Rule 144A shall be
issued initially in the form of one or more permanent global Securities in definitive, fully
registered form (collectively, the “Rule 144A Global Security”); Initial Securities
initially resold to IAIs shall be issued initially in the form of one or more permanent global
Securities in definitive, fully registered form (collectively, the “IAI Global Security”);
and Initial Securities initially resold pursuant to Regulation S shall be issued initially in the
form of one or more temporary global Securities in fully registered form (collectively, the
“Temporary Regulation S Global Security”), in each case without interest coupons and with
the global Securities legend and the applicable restricted securities legend set forth in Exhibit 1
hereto, which shall be deposited on behalf of the purchasers of the Initial Securities represented
thereby with the Securities Custodian and registered in the name of the Depository or a nominee of
the Depository, duly executed by the Company and authenticated by the Trustee as provided in this
Indenture. Except as set forth in this Section 2.1(a), beneficial ownership interests in the
Temporary Regulation S Global Security will not be exchangeable for interests in the Rule 144A
Global Security, the IAI Global Security, a permanent global Security (the “Permanent
Regulation S Global Security”, and together with the Temporary Regulation S Global Security,
the “Regulation S Global Security”) or any other Security prior to the expiration of the
Distribution Compliance Period and then, after the expiration of the Distribution Compliance
Period, may be exchanged for interests in a Rule 144A Global Security, an IAI Global Security or
the Permanent Regulation S Global Security only

 

 

4

upon certification in form reasonably satisfactory to the Trustee that (i) beneficial ownership
interests in such Temporary Regulation S Global Security are owned either by non-U.S. persons or
U.S. persons who purchased such interests in a transaction that did not require registration under
the Securities Act and (ii) in the case of an exchange for an IAI Global Security, certification
that the interest in the Temporary Regulation S Global Security is being transferred to an IAI
acquiring the Securities for its own account or for the account of another IAI.

     Beneficial interests in Temporary Regulation S Global Securities (after the expiration of the
Distribution Compliance Period) or IAI Global Securities may be exchanged for interests in Rule
144A Global Securities if (1) such exchange occurs in connection with a transfer of Securities in
compliance with Rule 144A and (2) the transferor of the beneficial interest in the Temporary
Regulation S Global Security or the IAI Global Security, as applicable, first delivers to the
Trustee a written certificate (in a form satisfactory to the Trustee) to the effect that the
beneficial interest in the Temporary Regulation S Global Security or the IAI Global Security, as
applicable, is being transferred to a Person (a) who the transferor reasonably believes to be a
QIB, (b) purchasing for its own account or the account of a QIB in a transaction meeting the
requirements of Rule 144A, and (c) in accordance with all applicable securities laws of the States
of the United States and other jurisdictions.

     Beneficial interests in Temporary Regulation S Global Securities (after the expiration of the
Distribution Compliance Period) and Rule 144A Global Securities may be exchanged for an interest in
IAI Global Securities if (1) such exchange occurs in connection with a transfer of the Securities
in compliance with an exemption under the Securities Act and (2) the transferor of the Regulation S
Global Security or Rule 144A Global Security, as applicable, first delivers to the trustee a
written certificate (substantially in the form of Exhibit 2) to the effect that (A) the Regulation
S Global Security or Rule 144A Global Security, as applicable, is being transferred (a) to an IAI
acquiring the Securities for its own account or for the account of another IAI 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 and (B) in accordance with all applicable securities laws of the States of the
United States and other jurisdictions.

     Beneficial interests in a Rule 144A Global Security or an IAI Global Security may be
transferred to a Person who takes delivery in the form of an interest in a Regulation S Global
Security, whether before or after the expiration of the Distribution Compliance Period, only if the
transferor first delivers to the Trustee a written certificate (in the form provided in this
Indenture) to the effect that such transfer is being made in accordance with Rule 903 or 904 of
Regulation S or Rule 144 (if applicable).

     The Rule 144A Global Security, the IAI Global Security, the Temporary Regulation S Global
Security and the Permanent Regulation S Global Security are collectively referred to herein as
“Global Securities”. The aggregate principal amount of the Global Securities may from time
to time be increased or decreased by adjustments

 

 

5

made on the records of the Trustee and the Depository or its nominee as hereinafter provided.

     (b) Book-Entry Provisions. This Section 2.1(b) shall apply only to a Global
Security deposited with or on behalf of the Depository.

          The Company shall execute and the Trustee shall, in accordance with this Section 2.1(b),
authenticate and deliver initially one or more Global Securities that (a) shall be registered in
the name of the Depository for such Global Security or Global Securities or the nominee of such
Depository and (b) shall be delivered by the Trustee to such Depository or pursuant to such
Depository’s instructions or held by the Trustee as custodian for the Depository.

          Members of, or participants in, the Depository (“Agent Members”) shall have no rights
under this Indenture with respect to any Global Security held on their behalf by the Depository or
by the Trustee as the custodian of the Depository or under such Global Security, and the Company,
the Trustee and any agent of the Company, the Guarantors or the Trustee shall be entitled to treat
the Depository as the absolute owner of such Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Company, the Guarantors, the
Trustee or any agent of the Company, the Guarantors or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depository or impair, as
between the Depository and its Agent Members, the operation of customary practices of such
Depository governing the exercise of the rights of a holder of a beneficial interest in any Global
Security.

          (c) Definitive Securities. Except as provided in this Section 2.1 or Section 2.3 or
2.4, owners of beneficial interests in Global Securities shall not be entitled to receive physical
delivery of Definitive Securities.

     2.2 Authentication

          The Trustee shall authenticate and deliver: (1) on the Issue Date, (A) an aggregate principal
amount of $300,000,000 12 1/2% Senior Notes due 2014, (2) any Additional Securities for an original
issue in an aggregate principal amount specified in the written order of the Company pursuant to
Section 2.03 of the Indenture and (3) Exchange Securities or Private Exchange Securities for issue
only in a Registered Exchange Offer or a Private Exchange, respectively, pursuant to a Registration
Rights Agreement, for a like principal amount of Initial Securities or Additional Securities, in
each case upon a written order of the Company signed by two Officers or by an Officer and either an
Assistant Treasurer or an Assistant Secretary of the Company. Such order shall specify the amount
of the Securities to be authenticated and the date on which the original issue of Securities is to
be authenticated and, in the case of any issuance and Additional Securities pursuant to Section
2.01 of the Indenture, shall certify that such issuance is in compliance with Section 4.03 of the
Indenture.

 

6

     2.3 Transfer and Exchange

          (a) Transfer and Exchange of Definitive Securities. When Definitive Securities are
presented to the Registrar with a request:

	 	(x)	 	to register the transfer of such Definitive Securities; or
	 
	 	(y)	 	to exchange such Definitive Securities for an equal principal
amount of Definitive Securities of other authorized denominations,

the Registrar shall register the transfer or make the exchange as requested if its reasonable
requirements for such transaction are met; provided, however, that the Definitive
Securities surrendered for transfer or exchange:

     (i) shall be duly endorsed or accompanied by a written instrument of transfer in form
reasonably satisfactory to the Company and the Registrar, duly executed by the Holder
thereof or its attorney duly authorized in writing; and

     (ii) if such Definitive Securities are required to bear a restricted securities
legend, they are being transferred or exchanged pursuant to an effective registration
statement under the Securities Act, pursuant to Section 2.3(b) or pursuant to clause (A),
(B) or (C) below, and are accompanied by the following additional information and
documents, as applicable:

     (A) if such Definitive Securities are being delivered to the Registrar by a
Holder for registration in the name of such Holder, without transfer, a
certification from such Holder to that effect; or

     (B) if such Definitive Securities are being transferred to the Company, a
certification to that effect; or

     (C) if such Definitive Securities are being transferred (x) pursuant to an
exemption from registration in accordance with Rule 144A, Regulation S or Rule 144
under the Securities Act; or (y) in reliance upon another exemption from the
requirements of the Securities Act: (i) a certification to that effect (in the form
set forth on the reverse of the Security) and (ii) if the Company so requests, an
opinion of counsel or other evidence reasonably satisfactory to it as to the
compliance with the restrictions set forth in the legend set forth in Section
2.3(e)(i).

          (b) Restrictions on Transfer of a Definitive Security for a Beneficial Interest in a
Global Security. A Definitive Security may not be exchanged for a beneficial interest in a
Rule 144A Global Security, an IAI Global Security or a Permanent Regulation S Global Security
except upon satisfaction of the requirements set forth below. Upon receipt by the Trustee of a
Definitive Security, duly endorsed or accompanied by appropriate instruments of transfer, in form
satisfactory to the Trustee, together with:

 

7

     (i) certification, in the form set forth on the reverse of the Security, that such
Definitive Security is either (A) being transferred to a QIB in accordance with Rule 144A,
(B) being transferred to an IAI or (C) being transferred after expiration of the
Distribution Compliance Period by a Person who initially purchased such Security in
reliance on Regulation S to a buyer who elects to hold its interest in such Security in the
form of a beneficial interest in the Permanent Regulation S Global Security; and

     (ii) written instructions directing the Trustee to make, or to direct the Securities
Custodian to make, an adjustment on its books and records with respect to such Rule 144A
Global Security (in the case of a transfer pursuant to clause (b)(i)(A)), IAI Global
Security (in the case of a transfer pursuant to clause (b)(i)(B)) or Permanent Regulation S
Global Security (in the case of a transfer pursuant to clause (b)(i)(C)) to reflect an
increase in the aggregate principal amount of the Securities represented by the Rule 144A
Global Security, IAI Global Security or Permanent Regulation S Global Security, as
applicable, such instructions to contain information regarding the Depository account to be
credited with such increase,

then the Trustee shall cancel such Definitive Security and cause, or direct the Securities
Custodian to cause, in accordance with the standing instructions and procedures existing between
the Depository and the Securities Custodian, the aggregate principal amount of Securities
represented by the Rule 144A Global Security, IAI Global Security or Permanent Regulation S Global
Security, as applicable, to be increased by the aggregate principal amount of the Definitive
Security to be exchanged and shall credit or cause to be credited to the account of the Person
specified in such instructions a beneficial interest in the Rule 144A Global Security, IAI Global
Security or Permanent Regulation S Global Security, as applicable, equal to the principal amount of
the Definitive Security so canceled. If no Rule 144A Global Securities, IAI Global Securities or
Permanent Regulation S Global Securities, as applicable, are then outstanding, the Company shall
issue and the Trustee shall authenticate, upon written order of the Company in the form of an
Officers’ Certificate of the Company, a new Rule 144A Global Security, IAI Global Security or
Permanent Regulation S Global Security, as applicable, in the appropriate principal amount.

          (c) Transfer and Exchange of Global Securities.

     (i) The transfer and exchange of Global Securities or beneficial interests therein
shall be effected through the Depository, in accordance with this Indenture (including
applicable restrictions on transfer set forth herein, if any) and the procedures of the
Depository therefor. A transferor of a beneficial interest in a Global Security shall
deliver to the Registrar a written order given in accordance with the Depository’s
procedures containing information regarding the participant account of the Depository to be
credited with a beneficial interest in the Global Security. The Registrar shall, in
accordance with such instructions, instruct the Depository to credit to the account of the
Person specified in such instructions a

 

8

beneficial interest in the Global Security and to debit the account of the Person
making the transfer the beneficial interest in the Global Security being transferred.

     (ii) If the proposed transfer is a transfer of a beneficial interest in one Global
Security to a beneficial interest in another Global Security, the Registrar shall reflect
on its books and records the date and an increase in the principal amount of the Global
Security to which such interest is being transferred in an amount equal to the principal
amount of the interest to be so transferred, and the Registrar shall reflect on its books
and records the date and a corresponding decrease in the principal amount of the Global
Security from which such interest is being transferred.

     (iii) Notwithstanding any other provisions of this Appendix (other than the
provisions set forth in Section 2.4), a Global Security may not be transferred as a whole
except by the Depository to a nominee of the Depository or by a nominee of the Depository
to the Depository or another nominee of the Depository or by the Depository or any such
nominee to a successor Depository or a nominee of such successor Depository.

     (iv) In the event that a Global Security is exchanged for Definitive Securities
pursuant to Section 2.4 of this Appendix, prior to the consummation of a Registered
Exchange Offer or the effectiveness of a Shelf Registration Statement with respect to such
Securities, such Securities may be exchanged only in accordance with such procedures as are
substantially consistent with the provisions of this Section 2.3 (including the
certification requirements set forth on the reverse of the Initial Securities intended to
ensure that such transfers comply with Rule 144A, Regulation S or another applicable
exemption under the Securities Act, as the case may be) and such other procedures as may
from time to time be adopted by the Company.

          (d) Restrictions on Transfer of Temporary Regulation S Global Securities. During the
Distribution Compliance Period, beneficial ownership interests in Temporary Regulation S Global
Securities may only be sold, pledged or transferred in accordance with the Applicable Procedures
and only (i) to the Company, (ii) in an offshore transaction in accordance with Regulation S (other
than a transaction resulting in an exchange for an interest in a Permanent Regulation S Global
Security), or (iii) pursuant to an effective registration statement under the Securities Act, in
each case in accordance with any applicable securities laws of any State of the United States.

          (e) Legend.

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

 

9

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

THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS SECURITY
MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) TO THE COMPANY, (II)
WITHIN THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (III) TO AN INSTITUTIONAL ACCREDITED INVESTOR WITHIN
THE MEANING OF RULE 501(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS ACQUIRING
SECURITIES IN AN AGGREGATE PRINCIPAL AMOUNT OF SECURITIES OF AT LEAST $250,000, AND THAT,
PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THIS SECURITY (THE FORM OF WHICH
CAN BE OBTAINED FROM THE TRUSTEE) AND AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT
SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (IV) OUTSIDE THE UNITED STATES IN
AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (V) PURSUANT
TO EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF
AVAILABLE) OR (VI) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT, IN EACH OF CASES (I) THROUGH (VI), IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO IN (A) ABOVE.

          Each certificate evidencing a Security offered in reliance on Regulation S shall, in lieu of
the foregoing, bear a legend in substantially the following form:

THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION
ORIGINALLY EXEMPT FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933 (THE

 

10

“SECURITIES ACT”), AND MAY NOT BE TRANSFERRED IN THE UNITED STATES OR TO, OR FOR
THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON EXCEPT PURSUANT TO AN AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ALL
APPLICABLE STATE SECURITIES LAWS. TERMS USED ABOVE HAVE THE MEANINGS GIVEN TO THEM
IN REGULATION S UNDER THE SECURITIES ACT.

Each Definitive Security shall also bear the following additional legend:

IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY
REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.

     (ii) Upon any sale or transfer of a Transfer Restricted Security (including any
Transfer Restricted Security represented by a Global Security) pursuant to Rule 144 under
the Securities Act, the Registrar shall permit the transferee thereof to exchange such
Transfer Restricted Security for a Definitive Security that does not bear the legend set
forth above and rescind any restriction on the transfer of such Transfer Restricted
Security, if the transferor thereof certifies in writing to the Registrar that such sale or
transfer was made in reliance on Rule 144 (such certification to be in the form set forth
on the reverse of the Security).

     (iii) After a transfer of any Initial Securities or Private Exchange Securities
pursuant to and during the period of the effectiveness of a Shelf Registration Statement
with respect to such Initial Securities or Private Exchange Securities, as the case may be,
all requirements pertaining to legends on such Initial Security or such Private Exchange
Security will cease to apply, the requirements requiring any such Initial Security or such
Private Exchange Security issued to certain Holders be issued in global form will cease to
apply, and a certificated Initial Security or Private Exchange Security or an Initial
Security or Private Exchange Security in global form, in each case without restrictive
transfer legends, will be available to the transferee of the Holder of such Initial
Securities or Private Exchange Securities upon exchange of such transferring Holder’s
certificated Initial Security or Private Exchange Security or directions to transfer such
Holder’s interest in the Global Security, as applicable.

     (iv) Upon the consummation of a Registered Exchange Offer with respect to the Initial
Securities or Additional Securities, all requirements pertaining to such Initial Securities
or Additional Securities that Initial Securities or Additional Securities issued to certain
Holders be issued in global form will still apply with respect to Holders of such Initial
Securities or Additional Securities that do not exchange their Initial Securities or
Additional Securities, and Exchange Securities

 

11

in certificated or global form, in each case without the restricted securities legend
set forth in Exhibit 1 hereto, will be available to Holders that exchange such Initial
Securities or Additional Securities in such Registered Exchange Offer.

     (v) Upon the consummation of a Private Exchange with respect to the Initial
Securities or Additional Securities, all requirements pertaining to such Initial Securities
or Additional Securities that Initial Securities or Additional Securities issued to certain
Holders be issued in global form will still apply with respect to Holders of such Initial
Securities or Additional Securities that do not exchange their Initial Securities or
Additional Securities, and Private Exchange Securities in global form with the global
securities legend and the applicable restricted securities legend set forth in Exhibit 1
hereto will be available to Holders that exchange such Initial Securities or Additional
Securities in such Private Exchange.

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

          (g) No Obligation of the Trustee.

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

     (ii) The Trustee shall have no obligation or duty to monitor, determine or inquire as
to compliance with any restrictions on transfer imposed under this

 

12

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

     2.4 Certificated Securities

          (a) A Global Security deposited with the Depository or with the Trustee as Securities
Custodian for the Depository pursuant to Section 2.1 shall be transferred to the beneficial owners
thereof in the form of Definitive Securities in an aggregate principal amount equal to the
principal amount of such Global Security, in exchange for such Global Security, only if such
transfer complies with Section 2.3 hereof and (i) the Depository notifies the Company that it is
unwilling or unable to continue as Depository for such Global Security and the Depository fails to
appoint a successor depositary or if at any time such Depository ceases to be a “clearing agency”
registered under the Exchange Act and, in either case, a successor Depository is not appointed by
the Company, or (ii) there has occurred and is continuing a Default with respect to the Securities
entitling the Holders to accelerate the maturity of the Securities or (iii) the Company, in its
sole discretion, notifies the Trustee in writing that it elects to cause the issuance of Definitive
Securities under this Indenture.

          (b) Any Global Security that is transferable to the beneficial owners thereof pursuant to
this Section 2.4 shall be surrendered by the Depository to the Trustee located at its principal
corporate trust office in the Borough of Manhattan, The City of New York, to be so transferred, in
whole or from time to time in part, without charge, and the Trustee shall authenticate and deliver,
upon such transfer of each portion of such Global Security, an equal aggregate principal amount of
Definitive Securities of authorized denominations. Any portion of a Global Security transferred
pursuant to this Section 2.4 shall be executed, authenticated and delivered only in denominations
of $2,000 principal amount and any integral multiple of $1,000 in excess of $2,000 and registered
in such names as the Depository shall direct. Any Definitive Security delivered in exchange for an
interest in the Transfer Restricted Security shall, except as otherwise provided by Section 2.3(e)
hereof, bear the applicable restricted securities legend and definitive Security legend set forth
in Exhibit 1 hereto.

          (c) Subject to the provisions of Section 2.4(b) hereof, the registered Holder of a Global
Security shall be entitled to grant proxies and otherwise authorize any Person, including Agent
Members and Persons that may hold interests through Agent Members, to take any action which a
Holder is entitled to take under this Indenture or the Securities.

          (d) In the event of the occurrence of one of the events specified in Section 2.4(a) hereof,
the Company shall promptly make available to the Trustee a reasonable supply of Definitive
Securities in definitive, fully registered form without interest

 

13

coupons. In the event that such Definitive Securities are not issued, the Company expressly
acknowledges, with respect to the right of any Holder to pursue a remedy pursuant to Section 6.06
of this Indenture, the right of any beneficial owner of Securities to pursue such remedy with
respect to the portion of the Global Security that represents such beneficial owner’s Securities as
if such Definitive Securities had been issued.

 

 

EXHIBIT 1 to Rule 144A/REGULATION S/IAI APPENDIX

[FORM OF FACE OF INITIAL SECURITY]

[Global Securities Legend]

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

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

     [[FOR REGULATION S GLOBAL SECURITY ONLY] UNTIL 40 DAYS AFTER THE LATER OF COMMENCEMENT OR
COMPLETION OF THE OFFERING, AN OFFER OR SALE OF SECURITIES WITHIN THE UNITED STATES BY A DEALER (AS
DEFINED IN THE SECURITIES ACT) MAY VIOLATE THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT IF
SUCH OFFER OR SALE IS MADE OTHERWISE THAN IN ACCORDANCE WITH RULE 144A THEREUNDER.]

[Restricted Securities Legend for Securities Offered Otherwise than in Reliance on

Regulation S]

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

 

2

     THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS SECURITY MAY
BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) TO THE COMPANY, (II) WITHIN THE
UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (III) TO AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING OF RULE 501(A)(1),
(2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS ACQUIRING SECURITIES IN AN AGGREGATE PRINCIPAL
AMOUNT OF SECURITIES OF AT LEAST $250,000, AND THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE
A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THIS
SECURITY (THE FORM OF WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND AN OPINION OF COUNSEL ACCEPTABLE
TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (IV) OUTSIDE THE UNITED
STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES ACT, (V)
PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER
(IF AVAILABLE) OR (VI) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN
EACH OF CASES (I) THROUGH (VI) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.

[Restricted Securities Legend for Securities Offered in Reliance on Regulation S.]

     THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION ORIGINALLY EXEMPT
FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933 (THE “SECURITIES ACT”), AND MAY NOT BE
TRANSFERRED IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON EXCEPT
PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND ALL
APPLICABLE STATE SECURITIES LAWS. TERMS USED ABOVE HAVE THE MEANINGS GIVEN TO THEM IN REGULATION S
UNDER THE SECURITIES ACT.

[Temporary Regulation S Global Security Legend]

     EXCEPT AS SET FORTH BELOW, BENEFICIAL OWNERSHIP INTERESTS IN THIS TEMPORARY REGULATION S
GLOBAL SECURITY WILL NOT BE EXCHANGEABLE FOR INTERESTS IN THE PERMANENT REGULATION S GLOBAL
SECURITY OR ANY OTHER SECURITY REPRESENTING AN INTEREST IN THE SECURITIES REPRESENTED HEREBY WHICH
DO NOT CONTAIN A LEGEND CONTAINING RESTRICTIONS ON

 

3

TRANSFER, UNTIL THE EXPIRATION OF THE “40-DAY DISTRIBUTION COMPLIANCE PERIOD” (WITHIN THE
MEANING OF RULE 903(b)(2) OF REGULATION S UNDER THE SECURITIES ACT) AND THEN ONLY UPON
CERTIFICATION IN FORM REASONABLY SATISFACTORY TO THE TRUSTEE THAT SUCH BENEFICIAL INTERESTS ARE
OWNED EITHER BY NON-U.S. PERSONS OR U.S. PERSONS WHO PURCHASED SUCH INTERESTS IN A TRANSACTION THAT
DID NOT REQUIRE REGISTRATION UNDER THE SECURITIES ACT. DURING SUCH 40-DAY DISTRIBUTION COMPLIANCE
PERIOD, BENEFICIAL OWNERSHIP INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY MAY ONLY BE
SOLD, PLEDGED OR TRANSFERRED (I) TO THE COMPANY, (II) OUTSIDE THE UNITED STATES IN A TRANSACTION IN
ACCORDANCE WITH RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, OR (III) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (III) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. HOLDERS OF
INTERESTS IN THIS TEMPORARY REGULATION S GLOBAL SECURITY WILL NOTIFY ANY PURCHASER OF THIS SECURITY
OF THE RESALE RESTRICTIONS REFERRED TO ABOVE, IF THEN APPLICABLE.

     AFTER THE EXPIRATION OF THE DISTRIBUTION COMPLIANCE PERIOD, BENEFICIAL INTERESTS IN THIS
TEMPORARY REGULATION S GLOBAL SECURITY MAY BE EXCHANGED FOR INTERESTS IN A RULE 144A GLOBAL
SECURITY ONLY IF (1) SUCH EXCHANGE OCCURS IN CONNECTION WITH A TRANSFER OF THE SECURITIES IN
COMPLIANCE WITH RULE 144A AND (2) THE TRANSFEROR OF THE REGULATION S GLOBAL SECURITY FIRST DELIVERS
TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO THE EFFECT THAT
THE REGULATION S GLOBAL SECURITY IS BEING TRANSFERRED (A) TO A PERSON WHO THE TRANSFEROR REASONABLY
BELIEVES TO BE A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, (B) TO A PERSON WHO
IS PURCHASING FOR ITS OWN ACCOUNT OR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, AND (C) IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE STATES OF THE UNITED STATES AND OTHER JURISDICTIONS.

     AFTER THE EXPIRATION OF THE DISTRIBUTION COMPLIANCE PERIOD, BENEFICIAL INTERESTS IN THIS
TEMPORARY REGULATION S GLOBAL SECURITY MAY BE EXCHANGED FOR INTERESTS IN AN IAI GLOBAL SECURITY
ONLY IF (1) SUCH EXCHANGE OCCURS IN CONNECTION WITH A TRANSFER OF THE SECURITIES IN COMPLIANCE WITH
AN EXEMPTION UNDER THE SECURITIES ACT AND (2) THE TRANSFEROR OF THE REGULATION S GLOBAL SECURITY
FIRST DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS CERTIFICATE) TO
THE EFFECT THAT THE REGULATION S GLOBAL SECURITY IS BEING TRANSFERRED (A) TO AN INSTITUTIONAL
“ACCREDITED INVESTOR”

 

4

WITHIN THE MEANING OF RULE 501(A)(1),(2),(3) OR (7) UNDER THE SECURITIES ACT THAT IS ACQUIRING
SECURITIES IN AN AGGREGATE PRINCIPAL AMOUNT OF SECURITIES OF AT LEAST $250,000, AND THAT, PRIOR TO
SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE TRANSFER OF THIS SECURITY (THE FORM OF WHICH CAN BE OBTAINED FROM THE
TRUSTEE) AND AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE
WITH THE SECURITIES ACT AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF
THE UNITED STATES AND OTHER JURISDICTIONS.

     BENEFICIAL INTERESTS IN A RULE 144A GLOBAL SECURITY OR AN IAI GLOBAL SECURITY MAY BE
TRANSFERRED TO A PERSON WHO TAKES DELIVERY IN THE FORM OF AN INTEREST IN THE REGULATION S GLOBAL
SECURITY, WHETHER BEFORE OR AFTER THE EXPIRATION OF THE 40-DAY DISTRIBUTION COMPLIANCE PERIOD, ONLY
IF THE TRANSFEROR FIRST DELIVERS TO THE TRUSTEE A WRITTEN CERTIFICATE (IN THE FORM ATTACHED TO THIS
CERTIFICATE) TO THE EFFECT THAT SUCH TRANSFER IS BEING MADE IN ACCORDANCE WITH RULE 903 OR 904 OF
REGULATION S OR RULE 144 (IF AVAILABLE).

[Definitive Securities Legend]

     IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT
SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM
THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

 

5

BUFFETS, INC.

12 1/2% Senior Notes due 2014

CUSIP No. [ ]

ISIN No.[   ]

$[   ]

No. 001

          BUFFETS, INC., a Minnesota corporation, promises to pay to Cede & Co., or its registered
assigns, the principal amount of [ ] Dollars ($[ ]) on November 1, 2014.

          Interest Payment Dates: January 1 and July 1

          Record Dates: December 15 and June 15

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

Dated:                                         

[SIGNATURE PAGE FOLLOWS]

 

6

          IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.

     Dated:

BUFFETS, INC.

	 	 	 	 	 	 	 
	 

	 	by	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	                              Name:	 	 
	 

	 	 	 	                              Title:	 	 

TRUSTEE’S CERTIFICATE OF

      AUTHENTICATION

U.S. BANK NATIONAL ASSOCIATION

as Trustee, certifies

     that this is one of

     the Securities referred

     to in the Indenture.

	 	 	 	 	 	 	 	 	 
	 

	 	 	 	by	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	 	 
	 

	 	 	 	Authorized	 	 	 	 
	 	 	Signatory
	 	 	 	 

 

7

[FORM OF REVERSE SIDE OF INITIAL SECURITY]

12 1/2% Senior Notes due 2014

1. Interest

          Buffets, Inc., a Minnesota corporation, (such Person, and its successors and assigns under the
Indenture hereinafter referred to, being herein called the “Company”), promises to pay interest on
the principal amount of this Security at a rate of 12 1/2% per annum set above; provided,
however, that if a Registration Default (as defined in the Registration Rights Agreement)
occurs, Additional Interest will accrue on this Security at a rate of 0.25% per annum (increasing
by an additional 0.25% per annum after each consecutive 90-day period that occurs after the date on
which such Registration Default occurs up to a maximum Additional Interest rate of 1.00%) from and
including the date on which any such Registration Default shall occur to but excluding the date on
which all Registration Defaults have been cured. The Company will pay interest semiannually in
arrears to the holders of record of the Securities on January 1 and July 1 of each year, commencing
January 1, 2007. Interest on the Securities will accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the Issue Date. Interest will be
computed on the basis of a 360-day year of twelve 30-day months. The Company will pay interest on
overdue principal at the rate borne by this Security plus 1.0% per annum, and it will pay interest
on overdue installments of interest at the same rate to the extent lawful.

2. Method of Payment

          The Company will pay interest on the Securities (except defaulted interest) to the Persons who
are registered holders of Securities at the close of business on the December 15, or June 15 next
preceding the interest payment date even if Securities are canceled after the record date and on or
before the interest payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Company will pay principal and interest in money of the United States that
at the time of payment is legal tender for payment of public and private debts. Payments in
respect of the Securities represented by a Global Security (including principal, premium and
interest) will be made by wire transfer of immediately available funds to the accounts specified by
the Depository. The Company will make all payments in respect of a certificated Security
(including principal, premium and interest) by mailing a check to the registered address of each
Holder thereof; provided, however, that payments on a certificated Security will be
made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United
States if such Holder elects payment by wire transfer by giving written notice to the Trustee or
the Paying Agent to such effect designating such account no later than 30 days immediately
preceding the relevant due date for payment (or such other date as the Trustee may accept in its
discretion).

 

8

3. Paying Agent and Registrar

          Initially, U.S. Bank National Association (the “Trustee”), will act as Paying Agent and
Registrar. The Company may appoint and change any Paying Agent, Registrar or co-registrar without
notice. The Company or any of its domestically incorporated Wholly Owned Subsidiaries may act as
Paying Agent, Registrar or co-registrar.

4. Indenture

          The Company issued the Securities under an Indenture dated as of November 1, 2006 (the
“Indenture”), among the Company, the Guarantors and the Trustee. The terms of the Securities
include those stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) (the “Act”). Terms defined in the
Indenture and not defined herein have the meanings ascribed thereto in the Indenture. The
Securities are subject to all such terms, and Securityholders are referred to the Indenture and the
Act for a statement of those terms.

          The Securities are unsecured obligations of the Company and consist of 12 1/2% Senior Notes
due 2014, including any Additional Securities that may be issued after the Issue Date. The
Indenture contains covenants that, among other things, limit the ability of the Company and its
Restricted Subsidiaries to incur additional indebtedness; pay dividends or distributions on, or
redeem or repurchase capital stock; make investments; engage in transactions with affiliates;
create liens on assets to secure indebtedness; transfer or sell assets; guarantee indebtedness;
restrict dividends or other payments of subsidiaries; and consolidate, merge or transfer all or
substantially all of its assets. These covenants are subject to important exceptions and
qualifications contained in the Indenture.

5. Optional Redemption

          Except as set forth below, the Company shall not be entitled to redeem the Securities.

          On and after November 1, 2010, the Company shall be entitled at its option on one or more
occasions to redeem all or a portion of the Securities upon not less than 30 nor more than 60 days’
notice, at the redemption prices (expressed in percentages of principal amount on the redemption
date), plus accrued and unpaid interest and Additional Interest, if any, to the redemption date
(subject to the right of Holders of record on the relevant record date to receive interest due on
the relevant interest payment date), if redeemed during the 12-month period commencing on November
1 of the years set forth below:

 

9

	 	 	 	 	 
	 	 	Redemption
	Period	 	Price
	2010
	 	 	106.250	%
	 
	 	 	 	 
	2011
	 	 	103.125	%
	 
	 	 	 	 
	2012 and thereafter
	 	 	100.00	%

          In addition, prior to November 1, 2010, the Company shall be entitled to redeem the Securities
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 Securities redeemed plus the
Applicable Premium as of, and accrued and unpaid interest and Additional Interest, if any, to the
applicable redemption date (subject to the right of holders of record on the relevant record date
to receive interest due on the relevant interest payment date).

          Notwithstanding the foregoing, prior to November 1, 2009, the Company shall upon not less than
30 nor more than 60 days’ notice, be entitled at its option on one or more occasions to redeem
Securities (which includes Additional Securities) in an aggregate principal amount not to exceed
35% of the aggregate principal amount of the Securities (which includes Additional Securities) at a
redemption price of 112 1/2% of the principal amount thereof, plus accrued and unpaid interest to
the redemption date (subject to the right of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date), with the net cash proceeds from one or
more Equity Offerings (provided, that, if the Equity Offering is by Parent or Buffets Restaurants,
a portion of the Net Cash Proceeds thereof equal to the amount required to redeem any such
Securities is contributed to the equity capital of the Company or used to acquire from the Company
Capital Stock (other than Disqualified Stock) of the Company); provided, however,
that (1) at least 65% of such aggregate principal amount of Securities (which includes Additional
Securities) remains outstanding immediately after the occurrence of each such redemption; and (2)
each such redemption occurs within 90 days after the consummation of the related Equity Offering.

6. 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 Securities to be redeemed at its registered
address. Securities in denominations larger than $1,000 principal amount may be redeemed in part
but only in whole multiples of $1,000. If money sufficient to pay the redemption price of and
accrued interest on all Securities (or portions thereof) to be redeemed on the redemption date is
deposited with the Paying Agent on or before the redemption date and certain other conditions are
satisfied, on and after such date interest ceases to accrue on such Securities (or such portions
thereof) called for redemption.

 

10

7. Put Provisions

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

8. Guarantee

          The payment by the Company of the principal of, and premium and interest on, the Securities is
fully and unconditionally guaranteed on a joint and several basis by each of the Guarantors to the
extent set forth in the Indenture.

9. Denominations; Transfer; Exchange

          The Securities are in registered form without coupons in denominations of $2,000 principal
amount and whole multiples of $1,000 in excess of $2,000. A Holder may transfer or exchange
Securities in accordance with the Indenture. The Registrar may require a Holder, among other
things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not register the transfer of or
exchange any Securities selected for redemption (except, in the case of a Security to be redeemed
in part, the portion of the Security not to be redeemed) or any Securities for a period of 15 days
before a selection of Securities to be redeemed or 15 days before an interest payment date.

10. Persons Deemed Owners

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

11. Unclaimed Money

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

12. Discharge and Defeasance

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

 

11

13. Amendment, Waiver

          Subject to certain exceptions, the Indenture and the Securities may be amended with the
written consent of the Holders of at least a majority in principal amount outstanding of the
Securities and any default or noncompliance with any provision may be waived with the written
consent of the Holders of a majority in principal amount outstanding of the Securities.

          Subject to certain exceptions set forth in the Indenture, without the consent of any
Securityholder, the Company, the Guarantors and the Trustee shall be entitled to amend the
Indenture or the Securities to cure any ambiguity, omission, defect, mistake or inconsistency, or
to comply with Article V of the Indenture, or to provide for uncertificated Securities in addition
to or in place of Definitive Securities, or to add guarantees with respect to the Securities,
including Guaranties, or to secure the Securities, or to add additional covenants or surrender
rights and powers conferred on the Company or the Guarantors, or to comply with any requirement of
the SEC in connection with qualifying the Indenture under the Act, to make certain changes to the
Indenture to provide for the issuance of Additional Securities or to make any change that does not
adversely affect the rights of any Securityholder, to make amendments to provisions of the
Indenture relating to the transfer and legending of the Securities, or conform the text of this
Indenture, the Security or the Guaranties to any provision of the “Description of Notes” section of
the Offering Circular to the extent that the provision in such section was intended to be a
verbatim recitation of a provision of this Indenture, the Security and the Guaranties.

14. Defaults and Remedies

          Under the Indenture, Events of Default include (a) default for 30 days in payment of interest
on the Securities; (b) default in payment of principal on the Securities at maturity, upon
redemption pursuant to Paragraph 5 of the Securities, upon acceleration or otherwise, or failure by
the Company to purchase Securities when required; (c) failure by the Company or certain
Subsidiaries to comply with other agreements in the Indenture or the Securities, in certain cases
subject to notice and lapse of time; (d) certain accelerations (including failure to pay within any
grace period after final maturity) of other Indebtedness of the Company or certain Subsidiaries if
the amount accelerated (or so unpaid) exceeds $25.0 million; (e) certain events of bankruptcy or
insolvency with respect to the Company, the Subsidiary Guarantors and the Significant Subsidiaries;
(f) certain judgments or decrees for the payment of money in excess of $25.0 million; and (g)
certain defaults with respect to Guarantees. If an Event of Default occurs and is continuing, the
Trustee or the Holders of at least 25% in principal amount of the Securities may declare all such
Securities to be due and payable immediately, subject to certain conditions set forth in the
Indenture. Certain events of bankruptcy or insolvency are Events of Default that will result in
the Securities being due and payable immediately upon the occurrence of such Events of Default.

          Securityholders are not entitled to enforce the Indenture or the Securities except as provided
in the Indenture. The Trustee is entitled to refuse to enforce the

 

12

Indenture or the Securities unless it receives indemnity or security reasonably satisfactory
to it. Subject to certain limitations, Holders of a majority in principal amount of the Securities
are entitled to direct the Trustee in its exercise of any trust or power. The Trustee is entitled
to withhold from Securityholders notice of any continuing Default (except a Default in payment of
principal or interest) if it determines that withholding notice is not opposed to the interest of
the Holders.

15. Trustee Dealings with the Company

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

16. No Recourse Against Others

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

17. Authentication

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

18. Abbreviations

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

19. CUSIP Numbers

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

 

13

20. Holders’ Compliance with Registration Rights Agreement

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

21. Governing Law

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

          The Company will furnish to any Securityholder upon written request and without charge to the
Securityholder a copy of the Indenture which has in it the text of this Security in larger type.
Requests may be made to:

Buffets, Inc.

1460 Buffet Way

Eagan, MN 55121

Attention: General Counsel

 

 

 

ASSIGNMENT FORM

To assign this Security, fill in the form below:

I or we assign and transfer this Security to

     (Print or type assignee’s name, address and zip code)

     (Insert assignee’s soc. sec. or tax I.D. No.)

and irrevocably appoint                     agent to transfer this Security on the books of
the Company. The agent may substitute another to act for him.

 

Date:                                         Your Signature:                         
                                                                           

 

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

In connection with any transfer of any of the Securities evidenced by this certificate occurring
prior to the expiration of the period referred to in Rule 144(k) under the Securities Act after the
later of the date of original issuance of such Securities and the last date, if any, on which such
Securities were owned by the Company or any Affiliate of the Company, the undersigned confirms that
such Securities are being transferred in accordance with its terms:

CHECK ONE BOX BELOW

	 	 	 	 	 	 	 	 	 
	o	 	to the Company; or
	 
	 	 	 	 	 	 	 	 
	 

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

	 	 	(2	)	 	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
	 
	 	 	 	 	 	 	 	 
	 

	 	 	(3	)	 	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; or

 

2

	 	 	 	 	 	 	 	 	 
	 

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

	 	 	(5	)	 	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.

Unless one of the boxes is checked, the Trustee will refuse to register any of the
Securities evidenced by this certificate in the name of any person other than the
registered holder thereof; provided, however, that if box (3), (4) or (5)
is checked, the Trustee shall be entitled to require, prior to registering any such
transfer of the Securities, such legal opinions, certifications and other information as
the Company has reasonably requested to confirm that such transfer is being made pursuant
to an exemption from, or in a transaction not subject to, the registration requirements of
the Securities Act of 1933, such as the exemption provided by Rule 144 under such Act.

                              Signature

Signature Guarantee:

	 	 	 	 	 
	 

	 	 
	 	 
	 
	 	 	 	 
	 

	 	Signature must be guaranteed
	 	Signature

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

 

 

3

TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.

          The undersigned represents and warrants that it is purchasing this Security for its own
account or an account with respect to which it exercises sole investment discretion and that it and
any such account is a “qualified institutional buyer” within the meaning of Rule 144A under the
Securities Act of 1933, and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the undersigned has
requested pursuant to Rule 144A or has determined not to request such information and that it is
aware that the transferor is relying upon the undersigned’s foregoing representations in order to
claim the exemption from registration provided by Rule 144A.

	 	 	 	 	 	 	 	 	 	 	 
	Dated:
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Notice:
	 	To be executed by an executive officer
	 	 

 

4

[TO BE ATTACHED TO GLOBAL SECURITIES]

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY

The following increases or decreases in this Global Security have been made:

	 	 	 	 	 	 	 	 	 
	 	 	Amount of decrease in	 	Amount of increase in	 	Principal amount of this	 	Signature of authorized
	 	 	Principal amount of this	 	Principal amount of this	 	Global Security following	 	officer of Trustee or
	Date of Exchange	 	Global Security	 	Global Security	 	such decrease or increase	 	Securities Coustodian
	 
	 	 	 	 	 	 	 	 

 

5

OPTION OF HOLDER TO ELECT PURCHASE

          If you want to elect to have this Security purchased by the Company pursuant to Section 4.06
or 4.08 of the Indenture, check the box:

     

          If you want to elect to have only part of this Security purchased by the Company pursuant to
Section 4.06 or 4.08 of the Indenture, state the amount in principal amount: $                    

	 	 	 	 	 	 	 	 	 	 	 
	Dated:

	 	 	 	 	 	Your Signature:	 	 	 	 
	 

	 	 

	 	 	 	 	 	 

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

	 	 	 	 	 
	Signature Guarantee: 
	 	 	 	 
	 

	 	 	 	 
	 	 	(Signature must be guaranteed)

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

 

 

EXHIBIT A

FORM OF FACE OF EXCHANGE SECURITY

OR PRIVATE EXCHANGE SECURITY*/**/

 

			
	*/	 	If the Security is to be issued in global form add the Global Securities Legend from
Exhibit 1 to Appendix A and the attachment from such Exhibit 1 captioned “[TO BE ATTACHED TO GLOBAL
SECURITIES] — SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY”.
	 
	**/	 	If the Security is a Private Exchange Security issued in a Private Exchange to an
Initial Purchaser holding an unsold portion of its initial allotment, add the Restricted Securities
Legend from Exhibit 1 to Appendix A and replace the Assignment Form included in this Exhibit A with
the Assignment Form included in such Exhibit 1.

 

2

BUFFETS, INC.

12 1/2% Senior Notes due 2014

			
	 	 	 
	 
	 	CUSIP No. [   ]
	 
	 	ISIN No. [   ]
	     No. 002
	 	$[   ]

          BUFFETS, INC., a Minnesota corporation, promises to pay to Cede & Co., or its registered
assigns, the principal amount of [ ] ($[ ]) on November 1, 2014.

          Interest Payment Dates: January 1 and July 1

          Record Dates: December 15 and June 15

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

Dated:                                         

[SIGNATURE PAGE FOLLOWS]

 

3

          IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.

          Dated:

          BUFFETS, INC.

	 	 	 	 	 	 	 
	 

	 	by	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	 
	 

	 	 	 	Title:	 	 

TRUSTEE’S CERTIFICATE OF

     AUTHENTICATION

U.S. BANK NATIONAL ASSOCIATION

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

	 	By	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Authorized Signatory	 	 

 

 

EXHIBIT A

[FORM OF REVERSE SIDE OF EXCHANGE SECURITY

OR PRIVATE EXCHANGE SECURITY]

12 1/2% Senior Notes due 2014

1. Interest

          Buffets, Inc., a Minnesota corporation (such Person, and its successors and assigns under the
Indenture hereinafter referred to, being herein called the “Company”), promises to pay interest on
the principal amount of this Security at a rate per annum of 12 1/2%[; provided,
however, that if a Registration Default (as defined in the Registration Rights Agreement)
occurs, Additional Interest will accrue on this Security at a rate of 0.25% per annum (increasing
by an additional 0.25% per annum after each consecutive 90-day period that occurs after the date on
which such Registration Default occurs up to a maximum Additional Interest rate of 1.00%) from and
including the date on which any such Registration Default shall occur to but excluding the date on
which all Registration Defaults have been cured.]1 The Company will pay interest
semiannually in arrears to the holders of record of the Securities on January 1 and July 1 of each
year, commencing January 1, 2007. Interest on the Securities will accrue from the most recent date
to which interest has been paid or, if no interest has been paid, from the Issue Date. Interest
will be computed on the basis of a 360-day year of twelve 30-day months. The Company will pay
interest on overdue principal at the rate borne by this Security plus 1.0% per annum, and it will
pay interest on overdue installments of interest at the same rate to the extent lawful.

2. Method of Payment

          The Company will pay interest on the Securities (except defaulted interest) to the Persons who
are registered holders of Securities at the close of business on the December 15 or June 15 next
preceding the interest payment date even if Securities are canceled after the record date and on or
before the interest payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Company will pay principal and interest in money of the United States that
at the time of payment is legal tender for payment of public and private debts. Payments in
respect of the Securities represented by a Global Security (including principal, premium and
interest) will be made by wire transfer of immediately available funds to the accounts specified by
the Depository. The Company will make all payments in respect of a Definitive Security (including
principal, premium and interest) by mailing a check to the registered address of each Holder
thereof; provided, however, that payments on a Definitive Security will be made by
wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if
such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying
Agent to such effect designating such account no later than 30 days

 

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

 

2

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, U.S. Bank National Association (the “Trustee”), will act as Paying Agent and
Registrar. The Company may appoint and change any Paying Agent, Registrar or co-registrar without
notice. The Company or any of its domestically incorporated Wholly Owned Subsidiaries may act as
Paying Agent, Registrar or co-registrar.

4. Indenture

          The Company issued the Securities under an Indenture dated as of November 1, 2006 (the
“Indenture”), among the Company, the Guarantors and the Trustee. The terms of the Securities
include those stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb) (the “Act”). Terms defined in the
Indenture and not defined herein have the meanings ascribed thereto in the Indenture. The
Securities are subject to all such terms, and Securityholders are referred to the Indenture and the
Act for a statement of those terms.

          The Securities are unsecured obligations of the Company and consist of 12 1/2% Senior Notes
due 2014, including any Additional Securities that may be issued after the Issue Date. The
Indenture contains covenants that, among other things, limit the ability of the Company and its
Restricted Subsidiaries to incur additional indebtedness; pay dividends or distributions on, or
redeem or repurchase capital stock; make investments; engage in transactions with affiliates;
create liens on assets to secure indebtedness; transfer or sell assets; guarantee indebtedness;
restrict dividends or other payments of subsidiaries; and consolidate, merge or transfer all or
substantially all of its assets. These covenants are subject to important exceptions and
qualifications contained in the Indenture.

5. Optional Redemption

          Except as set forth below, the Company shall not be entitled to redeem the Securities.

          On and after November 1, 2010, the Company shall be entitled at its option on one or more
occasions to redeem all or a portion of the Securities upon not less than 30 nor more than 60 days’
notice, at the redemption prices (expressed in percentages of principal amount on the redemption
date), plus accrued and unpaid interest and Additional Interest, if any, to the redemption date
(subject to the right of Holders of record on the relevant record date to receive interest due on
the relevant interest payment date), if redeemed during the 12-month period commencing on November
1 of the years set forth below:

 

3

	 	 	 	 	 
	 	 	Redemption
	Period	 	Price
	2010
	 	 	106.250	%
	2011
	 	 	103.125	%
	2012 and thereafter
	 	 	100.00	%

          In addition, prior to November 1, 2010, the Company shall be entitled to redeem the Securities
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 Securities redeemed plus the
Applicable Premium as of, and accrued and unpaid interest and Additional Interest, if any, to the
applicable redemption date (subject to the right of Holders of record on the relevant record date
to receive interest due on the relevant interest payment date).

          Notwithstanding the foregoing, prior to November 1, 2009, the Company shall upon not less than
30 nor more than 60 days’ notice be entitled at its option on one or more occasions to redeem
Securities (which includes Additional Securities) in an aggregate principal amount not to exceed
35% of the aggregate principal amount of the Securities (which includes Additional Securities) at a
redemption price of 112 1/2% of the principal amount thereof, plus accrued and unpaid interest to
the redemption date (subject to the right of Holders of record on the relevant record date to
receive interest due on the relevant interest payment date), with the net cash proceeds from one or
more Equity Offerings (provided, that, if the Equity Offering is by Parent or Buffets Restaurants,
a portion of the Net Cash Proceeds thereof equal to the amount required to redeem any such
Securities is contributed to the equity capital of the Company or used to acquire from the Company
Capital Stock (other than Disqualified Stock) of the Company); provided, however,
that (1) at least 65% of such aggregate principal amount of Securities (which includes Additional
Securities) remains outstanding immediately after the occurrence of each such redemption; and (2)
each such redemption occurs within 90 days after the consummation of the related Equity Offering.

6. 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 Securities to be redeemed at his registered
address. Securities in denominations larger than $1,000 principal amount may be redeemed in part
but only in whole multiples of $1,000. If money sufficient to pay the redemption price of and
accrued interest on all Securities (or portions thereof) to be redeemed on the redemption date is
deposited with the Paying Agent on or before the redemption date and certain other conditions are
satisfied, on and after such date interest ceases to accrue on such Securities (or such portions
thereof) called for redemption.

 

4

7. Put Provisions

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

8. Guarantee

          The payment by the Company of the principal of, and premium and interest on, the Securities is
fully and unconditionally guaranteed on a joint and several basis by each of the Guarantors to the
extent set forth in the Indenture.

9. Denominations; Transfer; Exchange

          The Securities are in registered form without coupons in denominations of $2,000 principal
amount and whole multiples of $1,000 in excess of $2,000. A Holder may transfer or exchange
Securities in accordance with the Indenture. The Registrar may require a Holder, among other
things, to furnish appropriate endorsements or transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not register the transfer of or
exchange any Securities selected for redemption (except, in the case of a Security to be redeemed
in part, the portion of the Security not to be redeemed) or any Securities for a period of 15 days
before a selection of Securities to be redeemed or 15 days before an interest payment date.

10. Persons Deemed Owners

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

11. Unclaimed Money

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

12. Discharge and Defeasance

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

 

5

13. Amendment, Waiver

          Subject to certain exceptions, the Indenture and the Securities may be amended with the
written consent of the Holders of at least a majority in principal amount outstanding of the
Securities and any default or noncompliance with any provision may be waived with the written
consent of the Holders of a majority in principal amount outstanding of the Securities.

          Subject to certain exceptions set forth in the Indenture, without the consent of any
Securityholder, the Company, the Guarantors and the Trustee shall be entitled to amend the
Indenture or the Securities to cure any ambiguity, omission, defect, mistake or inconsistency, or
to comply with Article V of the Indenture, or to provide for uncertificated Securities in addition
to or in place of certificated Securities, or to add guarantees with respect to the Securities,
including Guaranties, or to secure the Securities, or to add additional covenants or surrender
rights and powers conferred on the Company or the Guarantors, or to comply with any requirement of
the SEC in connection with qualifying the Indenture under the Act, to make certain changes to the
Indenture to provide for the issuance of Additional Securities or to make any change that does not
adversely affect the rights of any Securityholder, or to make amendments to provisions of the
Indenture relating to the transfer and legending of the Securities, or conform the text of this
Indenture, the Security or the Guaranties to any provision of the “Description of Notes” section of
the Offering Circular to the extent that the provision in such section was intended to be a
verbatim recitation of a provision of this Indenture, the Security and the Guaranties.

14. Defaults and Remedies

          Under the Indenture, Events of Default include (a) default for 30 days in payment of interest
on the Securities; (b) default in payment of principal on the Securities at maturity, upon
redemption pursuant to Paragraph 5 of the Securities, upon acceleration or otherwise, or failure by
the Company to purchase Securities when required; (c) failure by the Company or certain
Subsidiaries to comply with other agreements in the Indenture or the Securities, in certain cases
subject to notice and lapse of time; (d) certain accelerations (including failure to pay within any
grace period after final maturity) of other Indebtedness of the Company and certain Subsidiaries if
the amount accelerated (or so unpaid) exceeds $25.0 million; (e) certain events of bankruptcy or
insolvency with respect to the Company, the Guarantors and the Significant Subsidiaries; (f)
certain judgments or decrees for the payment of money in excess of $25.0 million; and (g) certain
defaults with respect to Guarantees. If an Event of Default occurs and is continuing, the Trustee
or the Holders of at least 25% in principal amount of the Securities may declare all such
Securities to be due and payable immediately, subject to certain conditions set forth in the
Indenture. Certain events of bankruptcy or insolvency are Events of Default which will result in
the Securities being due and payable immediately upon the occurrence of such Events of Default.

          Securityholders are not entitled to enforce the Indenture or the Securities except as provided
in the Indenture. The Trustee is entitled to refuse to enforce the Indenture or the Securities
unless it receives indemnity or security reasonably satisfactory to it. Subject to certain
limitations, Holders of a majority in principal amount of the Securities are entitled to direct the
Trustee in its exercise of any trust or power. The Trustee is entitled to withhold from

 

6

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

15. Trustee Dealings with the Company

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

16. No Recourse Against Others

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

17. Authentication

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

18. Abbreviations

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

19. CUSIP Numbers

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

 

7

20. Holders’ Compliance with Registration Rights Agreement

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

21. Governing Law

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

          The Company will furnish to any Securityholder upon written request and without charge to the
Securityholder a copy of the Indenture which has in it the text of this Security in larger type.
Requests may be made to:

Buffets, Inc.

1460 Buffet Way

Eagan, MN 55121

Attention: General Counsel

 

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

 

8

 

ASSIGNMENT FORM

To assign this Security, fill in the form below:

I or we assign and transfer this Security to

     (Print or type assignee’s name, address and zip code)

     (Insert assignee’s soc. sec. or tax I.D. No.)

and irrevocably appoint            agent to transfer this Security on the books of the
Company. The agent may substitute another to act for him.

 

Date:                                          Your Signature:  
                
                                                               

 

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

 

9

OPTION OF HOLDER TO ELECT PURCHASE

          If you want to elect to have this Security purchased by the Company pursuant to Section 4.06
or 4.08 of the Indenture, check the box:

     

          If you want to elect to have only part of this Security purchased by the Company pursuant to
Section 4.06 or 4.08 of the Indenture, state the amount in principal amount: $                    

	 	 	 	 	 	 	 	 	 	 	 
	Dated:

	 	 	 	 	 	Your Signature:	 	 	 	 
	 

	 	 

	 	 	 	 	 	 

	 	 
	 

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

	 	 	 	 	 
	Signature Guarantee:
	 	 	 	 
	 

	 	 

(Signature must be guaranteed)
	 	 

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

 

 

EXHIBIT 2 to Rule 144A/REGULATION S/IAI APPENDIX

Form of

Transferee Letter of Representation

Buffets, Inc.

In care of

U.S. Bank National Association

60 Livingston Avenue

St. Paul, Minnesota 55107

Ladies and Gentlemen:

     This certificate is delivered to request a transfer of $            principal amount of the
12 1/2% Senior Notes due 2014 (the “Securities”) of Buffets, Inc., a Minnesota corporation (the
“Company”).

     Upon transfer, the Securities 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 (the “Securities Act”)), purchasing for our own account or for
the account of such an institutional “accredited investor” at least $250,000 principal amount of
the Securities, and we are acquiring the Securities not with a view to, or for offer or sale in
connection with, any distribution in violation of the Securities Act. We have such knowledge and
experience in financial and business matters as to be capable of evaluating the merits and risks of
our investment in the Securities, and we invest in or purchase Securities similar to the Securities
in the normal course of our business. We, and any accounts for which we are acting, are each able
to bear the economic risk of our or its investment.

     2. We understand that the Securities have not been registered under the Securities Act and,
unless so registered, may not be sold except as permitted in the following sentence. We agree on
our own behalf and on behalf of any investor account for which we are purchasing Securities to
offer, sell or otherwise transfer such Securities prior to the date that is two years after the
later of the date of original issue and the last date on which the Company or any affiliate of the
Company was the owner of such Securities (or any predecessor thereto) (the “Resale

 

 

Restriction Termination Date”) only (i) to the Company, (ii) in the United States to a person
whom the seller reasonably believes is a qualified institutional buyer in a transaction meeting the
requirements of Rule 144A, (iii) to an institutional “accredited investor” within the meaning of
Rule 501(a)(1), (2), (3) or (7) under the Securities Act that is an institutional accredited
investor purchasing for its own account or for the account of an institutional accredited investor,
in each case in a minimum principal amount of the Securities of $250,000, (iv) outside the United
States in a transaction complying with the provisions of Rule 904 under the Securities Act, (v)
pursuant to an exemption from registration under the Securities Act provided by Rule 144 (if
available) or (vi) pursuant to an effective registration statement under the Securities Act, in
each of cases (i) through (vi) subject to any requirement of law that the disposition of our
property or the property of such investor account or accounts be at all times within our or their
control and in compliance with any applicable state securities laws. The foregoing restrictions on
resale will not apply subsequent to the Resale Restriction Termination Date. If any resale or
other transfer of the Securities is proposed to be made pursuant to clause (iii) above prior to the
Resale Restriction Termination Date, the transferor shall deliver a letter from the transferee
substantially in the form of this letter to the Company and the Trustee, which shall provide, among
other things, that the transferee is an institutional “accredited investor” within the meaning of
Rule 501(a)(1), (2), (3) or (7) under the Securities Act and that it is acquiring such Securities
for investment purposes and not for distribution in violation of the Securities Act. Each
purchaser acknowledges that the Company and the Trustee reserve the right prior to the offer, sale
or other transfer prior to the Resale Restriction Termination Date of the Securities pursuant to
clause (iii), (iv) or (v) above to require the delivery of an opinion of counsel, certifications or
other information satisfactory to the Company and the Trustee.

	 	 	 	 	 	 	 	 	 
	 	 	TRANSFEREE:                                                             ,
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	by:	 	 	 	 
	 

	 	 	 	 	 	 

	 	 

 

 

APPENDIX B

[FORM OF SUPPLEMENTAL INDENTURE TO BE

DELIVERED BY ADDITIONAL SUBSIDIARY GUARANTORS]

          SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of November 1, 2006 among [
] (the “Additional Subsidiary Guarantor”), a [ ] corporation and a [direct][indirect]
subsidiary of Buffets, Inc., a Minnesota corporation (or its permitted successor) (the “Company”),
and U.S. Bank National Association, as Trustee under the Indenture (the “Trustee”).

W I T N E S S E T H :

          WHEREAS the Company, Parent and the Subsidiary Guarantors have heretofore executed and
delivered to the Trustee an Indenture (the “Indenture”), dated as of November 1, 2006, providing
for the issuance of Securities (the “Securities”);

          WHEREAS, Section 4.10 and Section 10.06 of the Indenture provide that under certain
circumstances the Company will cause the Additional Subsidiary Guarantor to execute and deliver to
the Trustee a guaranty agreement pursuant to which the Additional Subsidiary Guarantor will
Guarantee payment of the Securities on the same terms and conditions as those set forth in Article
X of the Indenture; and

          WHEREAS, pursuant to Section 9.01(iv) of the Indenture, the Trustee and the Company are
authorized to execute and deliver this Supplemental Indenture.

          NOW THEREFORE, in consideration of the foregoing and for good and valuable consideration, the
receipt of which is hereby acknowledged, the Company, the Additional Subsidiary Guarantor and the
Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the
Securities as follows:

          SECTION 1. Capitalized Terms. Capitalized terms used herein but not defined shall
have the meanings assigned to them in the Indenture.

          SECTION 2. Guarantees. The Additional Subsidiary Guarantor hereby agrees, jointly
and severally with all other Guarantors, to guarantee the Company’ obligations under the Securities
on the terms and subject to the conditions set forth in Article X of the Indenture and to be bound
by all other applicable provisions of the Indenture as a Subsidiary Guarantor.

          SECTION 3. 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
Securities heretofore or hereafter authenticated and delivered shall be bound hereby.

          SECTION 4. Governing Law. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

 

2

          SECTION 5. Trustee Makes No Representation. The Trustee makes no representation as
to the validity or sufficiency of this Supplemental Indenture.

          SECTION 6. 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.

          SECTION 7. Effect of Headings. The Section headings herein are for convenience only
and shall not effect the construction of this Supplemental Indenture.

 

3

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

	 	 	 	 	 	 	 	 	 
	 	 	BUFFETS, INC.,	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	by	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:	 	 
	 

	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[ADDITIONAL SUBSIDIARY GUARANTOR],	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	by	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:	 	 
	 

	 	 	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	U.S. BANK NATIONAL ASSOCIATION,	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	by	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:	 	 
	 

	 	 	 	 	 	Title:

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