Document:

Execution
Copy

 

 

CONSTRUCTION LOAN
AGREEMENT

 

 

DATED AS OF SEPTEMBER 30,
2004

 

 

AMONG

 

PHASE II MALL HOLDING,
LLC

and

PHASE II MALL SUBSIDIARY,
LLC,

as the Borrowers,

 

THE LENDERS LISTED
HEREIN,

as the Lenders,

 

THE BANK OF NOVA SCOTIA,

as the Sole Lead Arranger and the Sole Bookrunner, and

 

SUMITOMO MITSUI BANKING
CORPORATION,

as the Syndication Agent.

 

 

TABLE
OF CONTENTS

 

	
  1.

  	
  Definitions

  	
   

  
	
   

  	
  1.1

  	
  Certain Defined
  Terms

  	
   

  
	
   

  	
  1.2

  	
  Accounting
  Terms; Utilization of GAAP for Purposes of Calculations Under Agreement

  	
   

  
	
   

  	
  1.3

  	
  Other Definitional
  Provisions and Rules of Construction

  	
   

  
	
  2.

  	
  Amounts and Terms
  of Commitments and Loans

  	
   

  
	
   

  	
  2.1

  	
  Commitments;
  Making of Loans; the Register; Notes

  	
   

  
	
   

  	
  2.2

  	
  Interest
  on the Loans

  	
   

  
	
   

  	
  2.3

  	
  Fees

  	
   

  
	
   

  	
  2.4

  	
  Repayments, Prepayments
  and Reductions in Commitments; General Provisions Regarding Payments

  	
   

  
	
   

  	
  2.5

  	
  Use of Proceeds

  	
   

  
	
   

  	
  2.6

  	
  Special
  Provisions Governing Eurodollar Rate Loans

  	
   

  
	
   

  	
  2.7

  	
  Increased
  Costs; Taxes; Capital Adequacy

  	
   

  
	
   

  	
  2.8

  	
  Obligation of Lenders to
  Mitigate

  	
   

  
	
   

  	
  2.9

  	
  Obligations Joint and Several

  	
   

  
	
  3.

  	
  Conditions to Credit Extensions

  	
   

  
	
   

  	
  3.1

  	
  Conditions to the
  Occurrence of the Closing Date

  	
   

  
	
   

  	
  3.2

  	
  Additional Conditions to
  Loans on or after the Closing Date

  	
   

  
	
  4.

  	
  Borrowers’
  Representations and Warranties

  	
   

  
	
   

  	
  4.1

  	
  Organization,
  Powers, Qualification, Good Standing, Business and Subsidiaries

  	
   

  
	
   

  	
  4.2

  	
  Authorization
  of Borrowing, etc

  	
   

  
	
   

  	
  4.3

  	
  Financial Condition

  	
   

  
	
   

  	
  4.4

  	
  No Material Adverse Change

  	
   

  
	
   

  	
  4.5

  	
  Title to Properties; Liens; Real
  Property

  	
   

  
	
   

  	
  4.6

  	
  Litigation;
  Adverse Facts

  	
   

  
	
   

  	
  4.7

  	
  Payment of
  Taxes

  	
   

  
	
   

  	
  4.8

  	
  Performance of Agreements;
  Materially Adverse Agreements; Material Contracts

  	
   

  
	
   

  	
  4.9

  	
  Governmental Regulation

  	
   

  

 

i

 

	
   

  	
  4.10

  	
  Employee
  Benefit Plans

  	
   

  
	
   

  	
  4.11

  	
  Certain
  Fees

  	
   

  
	
   

  	
  4.12

  	
  Environmental Protection

  	
   

  
	
   

  	
  4.13

  	
  Employee
  Matters

  	
   

  
	
   

  	
  4.14

  	
  Solvency

  	
   

  
	
   

  	
  4.15

  	
  Matters Relating to Collateral

  	
   

  
	
   

  	
  4.16

  	
  Construction Litigation

  	
   

  
	
   

  	
  4.17

  	
  Accuracy of Information

  	
   

  
	
   

  	
  4.18

  	
  Compliance with Laws

  	
   

  
	
  5.

  	
  Borrowers’ Affirmative
  Covenants

  	
   

  
	
   

  	
  5.1

  	
  Financial Statements and
  Other Reports

  	
   

  
	
   

  	
  5.2

  	
  Corporate Existence, etc

  	
   

  
	
   

  	
  5.3

  	
  Payment of Taxes and
  Claims; Tax Consolidation

  	
   

  
	
   

  	
  5.4

  	
  Maintenance of Properties;
  Insurance; Application of Net Loss Proceeds

  	
   

  
	
   

  	
  5.5

  	
  Inspection;
  Lender Meeting

  	
   

  
	
   

  	
  5.6

  	
  Compliance
  with Laws, etc.; Permits

  	
   

  
	
   

  	
  5.7

  	
  Environmental Covenant

  	
   

  
	
   

  	
  5.8

  	
  Compliance
  with Material Contracts

  	
   

  
	
   

  	
  5.9

  	
  Discharge
  of Liens

  	
   

  
	
   

  	
  5.10

  	
  Further Assurances

  	
   

  
	
   

  	
  5.11

  	
  Future Subsidiaries

  	
   

  
	
   

  	
  5.12

  	
  Interest
  Rate Protection

  	
   

  
	
  6.

  	
  Borrowers’ Negative Covenants.

  	
   

  
	
   

  	
  6.1

  	
  Indebtedness

  	
   

  
	
   

  	
  6.2

  	
  Liens and Related Matters

  	
   

  
	
   

  	
  6.3

  	
  Investments;
  Joint Ventures; Formation of Subsidiaries

  	
   

  
	
   

  	
  6.4

  	
  Contingent Obligations

  	
   

  
	
   

  	
  6.5

  	
  Restricted Payments

  	
   

  
	
   

  	
  6.6

  	
  Restriction on
  Fundamental Changes; Asset Sales; Leases and Acquisitions

  	
   

  

 

ii

 

	
   

  	
  6.7

  	
  Sales and
  Lease-Backs

  	
   

  
	
   

  	
  6.8

  	
  Sale
  or Discount of Receivables

  	
   

  
	
   

  	
  6.9

  	
  Transactions
  with Shareholders and Affiliates

  	
   

  
	
   

  	
  6.10

  	
  Disposal
  of Subsidiary Stock

  	
   

  
	
   

  	
  6.11

  	
  Conduct of
  Business

  	
   

  
	
   

  	
  6.12

  	
  Certain Restrictions on
  Changes to Certain Documents

  	
   

  
	
   

  	
  6.13

  	
  Capital Expenditures

  	
   

  
	
   

  	
  6.14

  	
  Fiscal Year

  	
   

  
	
   

  	
  6.15

  	
  Zoning and Contract
  Changes and Compliance

  	
   

  
	
   

  	
  6.16

  	
  No Joint Assessment; Separate Lots

  	
   

  
	
   

  	
  6.17

  	
  Application
  of Mall Sales Proceeds

  	
   

  
	
  7.

  	
  Events
  of Default

  	
   

  
	
   

  	
  7.1

  	
  Failure to
  Make Payments When Due

  	
   

  
	
   

  	
  7.2

  	
  Default under Other
  Indebtedness or Contingent Obligations

  	
   

  
	
   

  	
  7.3

  	
  Breach
  of Certain Covenants

  	
   

  
	
   

  	
  7.4

  	
  Breach of
  Warranty.

  	
   

  
	
   

  	
  7.5

  	
  Other
  Defaults Under Loan Documents

  	
   

  
	
   

  	
  7.6

  	
  Involuntary Bankruptcy;
  Appointment of Receiver, etc

  	
   

  
	
   

  	
  7.7

  	
  Voluntary Bankruptcy;
  Appointment of Receiver, etc

  	
   

  
	
   

  	
  7.8

  	
  Judgments
  and Attachments

  	
   

  
	
   

  	
  7.9

  	
  Dissolution

  	
   

  
	
   

  	
  7.10

  	
  Employee
  Benefit Plans

  	
   

  
	
   

  	
  7.11

  	
  Failure of Collateral Document;
  Repudiation of Obligations

  	
   

  
	
   

  	
  7.12

  	
  Default Under or
  Termination of Operative Documents

  	
   

  
	
   

  	
  7.13

  	
  Default
  Under or Termination of Permits

  	
   

  
	
   

  	
  7.14

  	
  Certain Investments

  	
   

  
	
  8.

  	
  Agents and
  Arranger

  	
   

  
	
   

  	
  8.1

  	
  Appointment

  	
   

  
	
   

  	
  8.2

  	
  Powers
  and Duties; General Immunity

  	
   

  

 

iii

 

	
   

  	
  8.3

  	
  Representations and Warranties; No
  Responsibility for Appraisal of Credit Worthiness

  	
   

  
	
   

  	
  8.4

  	
  Right to
  Indemnity

  	
   

  
	
   

  	
  8.5

  	
  Successor Administrative
  Agent

  	
   

  
	
   

  	
  8.6

  	
  Collateral Documents

  	
   

  
	
   

  	
  8.7

  	
  Disbursement Agreement

  	
   

  
	
   

  	
  8.8

  	
  The
  Syndication Agent

  	
   

  
	
  9.

  	
  Miscellaneous

  	
   

  
	
   

  	
  9.1

  	
  Assignments
  and Participations in Loans

  	
   

  
	
   

  	
  9.2

  	
  Expenses

  	
   

  
	
   

  	
  9.3

  	
  Indemnity

  	
   

  
	
   

  	
  9.4

  	
  Set-Off; Security Interest
  in Deposit Accounts

  	
   

  
	
   

  	
  9.5

  	
  Ratable Sharing

  	
   

  
	
   

  	
  9.6

  	
  Amendments
  and Waivers

  	
   

  
	
   

  	
  9.7

  	
  Certain Matters
  Affecting Lenders

  	
   

  
	
   

  	
  9.8

  	
  Independence
  of Covenants

  	
   

  
	
   

  	
  9.9

  	
  Notices

  	
   

  
	
   

  	
  9.10

  	
  Survival of
  Representations, Warranties and Agreements

  	
   

  
	
   

  	
  9.11

  	
  Failure or Indulgence Not
  Waiver; Remedies Cumulative

  	
   

  
	
   

  	
  9.12

  	
  Marshalling;
  Payments Set Aside

  	
   

  
	
   

  	
  9.13

  	
  Severability

  	
   

  
	
   

  	
  9.14

  	
  Obligations Several; Independent
  Nature of Lenders’ Rights

  	
   

  
	
   

  	
  9.15

  	
  Headings

  	
   

  
	
   

  	
  9.16

  	
  Applicable
  Law

  	
   

  
	
   

  	
  9.17

  	
  Successors
  and Assigns

  	
   

  
	
   

  	
  9.18

  	
  Consent to Jurisdiction
  and Service of Process

  	
   

  
	
   

  	
  9.19

  	
  Waiver
  of Jury Trial

  	
   

  
	
   

  	
  9.20

  	
  Confidentiality

  	
   

  
	
   

  	
  9.21

  	
  Counterparts;
  Effectiveness

  	
   

  
	
   

  	
  9.22

  	
  USA
  Patriot Act

  	
   

  

 

iv

 

	
   

  	
  9.23

  	
  Electronic Execution of Assignments

  	
   

  
	
   

  	
  9.24

  	
  Gaming Authorities

  	
   

  

 

 

SCHEDULES

	
  2.1

  	
  Lenders’
  Commitments, Percentages, Notice Information

  
	
  3.1G(iv)

  	
  Schedule
  of Security Filings

  
	
  4.1A

  	
  Jurisdiction
  of Organizations

  
	
  4.1C

  	
  Ownership
  of the Borrowers

  
	
  4.1D

  	
  Subsidiaries
  of the Borrowers

  
	
  4.1E

  	
  Options

  
	
  4.2C

  	
  Governmental
  Approvals

  
	
  4.5

  	
  Mortgaged
  Real Property and Material Real Estate

  
	
  4.6

  	
  Litigation

  
	
  4.8

  	
  Material
  Contracts

  
	
  4.12

  	
  Environmental
  Matters

  
	
  4.15B

  	
  Permits

  
	
  6.1

  	
  Indebtedness
  Existing on the Closing Date

  
	
  6.2

  	
  Liens
  Existing on the Closing Date

  
	
  6.3

  	
  Investments
  Existing on the Closing Date

  
	
  6.6

  	
  Leases
  Existing on the Closing Date

  
	
  6.9

  	
  Affiliate
  Transactions Existing on the Closing Date

  

 

v

 

EXHIBITS

 

	
  A

  	
  Form of Note

  
	
  B-1

  	
  Form of Borrowing
  Notice

  
	
  B-2

  	
  Form of
  Conversion/Continuation Notice

  
	
  C-1

  	
  Form of Assignment
  Agreement

  
	
  C-2

  	
  Form of Certificate of
  Non-Bank Status

  
	
  D-1

  	
  Form of Deed of Trust

  
	
  D-2

  	
  Form of Security
  Agreement

  
	
  D-3

  	
  Form of Disbursement
  Agreement

  
	
  D-4

  	
  Form of Collateral
  Account Agreement

  
	
  D-5

  	
  Form of Assignment of
  Phase II Mall Sale Agreement

  
	
  D-6

  	
  Form of Assignment of
  Rate Protection Agreement

  
	
  E

  	
  Form of Financial
  Condition Certificate

  
	
  F-1

  	
  Form of Opinion of
  Paul, Weiss, Rifkind, Wharton & Garrison

  
	
  F-2

  	
  Form of Opinion of
  Lionel Sawyer & Collins

  
	
  G-1

  	
  Form of Subordination,
  Non-Disturbance and Attornment Agreement

  
	
  G-2

  	
  Form of Estoppel
  Certificate

  
	
  H

  	
  Form of Environmental
  Indemnity

  
	
  I

  	
  Form of Consent

  
	
  J

  	
  Form of Intercompany
  Mall Note

  
	
  K

  	
  Phase II Mall and Phase
  II Project Insurance Requirements

  
	
  L

  	
  Phase II Mall Air Space
  Description

  

 

 

PHASE II MALL HOLDING,
LLC

and

PHASE II MALL SUBSIDIARY, LLC

 

CONSTRUCTION LOAN
AGREEMENT

 

This CONSTRUCTION
LOAN AGREEMENT is dated as of September 30, 2004 and entered into by
and among PHASE II MALL HOLDING, LLC
(“Phase II Mall Subsidiary Holding”),
a Nevada limited liability company, and PHASE
II MALL SUBSIDIARY, LLC (“Phase II
Mall Subsidiary”), a Delaware limited liability company, as joint
and several obligors (each of Phase II Mall Subsidiary Holding and Phase II
Mall Subsidiary, a “Borrower” and,
collectively, the “Borrowers”), THE FINANCIAL INSTITUTIONS LISTED ON THE SIGNATURE
PAGES HEREOF (each individually referred to herein as a “Lender” and collectively as the “Lenders”), THE BANK OF NOVA SCOTIA (“Scotia
Capital”), as Sole Lead Arranger and Sole Bookrunner (in such
capacities, the “Arranger”) and as
the administrative agent for the Lenders (in such capacity, the “Administrative Agent”) and SUMITOMO MITSUI BANKING CORPORATION, as
syndication agent for the Lenders (in such capacity, the “Syndication Agent”).

 

R E C I T A L S

 

WHEREAS, LCR (such capitalized term and other
capitalized terms used in these recitals have the meanings given in subsection
1.1 of this Agreement), an indirect, wholly-owned subsidiary of LVSI and
Venetian, owns (or will own immediately after the execution of this Agreement)
the Site and intends to design, develop, and construct the Phase II Project
and, after the Substantial Completion Date, operate the Phase II Hotel/Casino;

 

WHEREAS, Phase II Mall Subsidiary Holding is an
indirect wholly-owned Subsidiary of LVSI and Venetian and owns 100% of the
Securities of Phase II Mall Subsidiary;

 

WHEREAS, Phase II Mall Subsidiary owns or will
own the Phase II Mall Air Parcel and leases or will lease the portion of the
Phase II Mall Space covered by the Phase II Mall Lease, the Walgreens Lease and
the Master Lease;

 

WHEREAS, on the Phase II Mall Release Date,
Phase II Mall Subsidiary Holding will sell the equity interests of Phase II
Mall Subsidiary to GGP;

 

WHEREAS, the Borrowers desire to enter into this
Agreement to finance certain Phase II Mall Project Costs and to pay fees and
expenses incurred in connection with the establishment of this Agreement, the
consummation of the Phase II Mall Construction Loan and the other transactions
related hereto and thereto;

 

WHEREAS, the Borrowers desire that the Lenders
extend the Phase II Mall Construction Loan on the terms and conditions set
forth herein for the purposes set forth herein; and

 

 

WHEREAS, the Lenders are willing, on the terms
and subject to the conditions hereinafter set forth, to extend the Commitments
and make Loans to the Borrowers.

 

NOW, THEREFORE, the parties hereto agree as follows:

 

1.             Definitions.

 

1.1           Certain
Defined Terms.

 

The following terms used in this Agreement shall have
the following meanings:

 

“Additional
Contingent Claims” is defined in Section 4.16.

 

“Adelson”
means Sheldon G. Adelson, an individual.

 

“Adjusted Eurodollar
Rate” means, for any Interest Rate Determination Date with respect
to an Interest Period for a Eurodollar Rate Loan, the rate per annum obtained
by dividing (a) the arithmetic average (rounded upward to the
nearest 1/100 of one percent) of the offered quotations, if any, to first class
banks in the interbank Eurodollar market for Dollar deposits of amounts in same
day funds comparable to the respective principal amounts of the Eurodollar Rate
Loans of the Administrative Agent for which the Adjusted Eurodollar Rate is
then being determined with maturities comparable to such Interest Period as of
approximately 10:00 A.M. (New York time) on such Interest Rate Determination
Date by (b) a percentage equal to 100% minus the stated
maximum rate of all reserve requirements (including any marginal, emergency,
supplemental, special or other reserves) applicable on such Interest Rate
Determination Date to any member bank of the Federal Reserve System in respect
of “Eurocurrency liabilities” as defined in Regulation D (or any successor
category of liabilities under Regulation D).

 

“Administrative
Agent” is defined in the preamble and also means and includes any
successor Administrative Agent appointed pursuant to subsection 8.5.

 

“Advance” has the meaning given in the
Disbursement Agreement.

 

“Advance Request”
has the meaning given in the Disbursement Agreement.

 

“Affected Lender”
is defined in subsection 2.6C.

 

“Affected Loans”
is defined in subsection 2.6C.

 

“Affiliate”
as applied to any Person means any other Person directly or indirectly
controlling, controlled by, or under direct or indirect common control with,
that Person (excluding, however, any trustee under, or any committee with
responsibility for administering any Pension Plan).  With respect to any Lender or Approved Fund, a Person shall be
deemed to be “controlled by” another Person if such other Person possesses,
directly or indirectly, power to vote 51% or more of the securities (on a fully
diluted basis) having ordinary voting power for the election of directors,
managing general partners or managers, as the case may be.  With respect to all other Persons, “control”
(including, with correlative meanings, the terms “controlling”, “controlled by”
and “under common control with”), as applied to any such other Person, means

 

2

 

the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of that Person, whether through the ownership of voting
Securities or by contract or otherwise; provided, however, the
beneficial owner of 10% or more of the voting securities of a Person shall be
deemed to have control.

 

“Agent”
means, individually, each of the Administrative Agent, the Syndication Agent,
the Disbursement Agent and the Arranger, and “Agents”
means the Administrative Agent, the Syndication Agent, the Disbursement Agent
and the Arranger, collectively.

 

“Aggregate Amounts
Due” is defined in subsection 9.5.

 

“Agreement”
means, on any date, this Construction Loan Agreement, dated as of the Closing
Date and as thereafter from time to time amended, supplemented, amended and
restated or otherwise modified from time to time and in effect on such date.

 

“Applicable Margin”
means (a) in the case of Loans accruing interest as Base Rate Loans, 0.75% per
annum, and (b) in the case of Loans accruing interest as Eurodollar Rate
Loans, 1.75% per  annum.

 

“Approved Fund”
means, (i) a fund that invests in bank loans, or (ii) relative to any Lender,
any other fund that invests in bank loans and is advised or managed by the same
investment advisor as such Lender or by an Affiliate of such investment
advisor.

 

“Arranger”
is defined in the preamble.

 

“Arranger’s Fee Letter” means the fee
letter, dated as of July 15, 2004, among the Arranger and the Borrowers.

 

“Asset Sale”
means the sale by a Borrower to any Person of (a) any of the stock of any
of such Person’s Subsidiaries (including the equity interests of the Phase II
Mall Subsidiary under the Phase II Mall Sale Agreement), (b) substantially
all of the assets of any division or line of business of a Borrower or any of
its Subsidiaries, or (c) any other assets (whether tangible or intangible)
of a Borrower or any of its Subsidiaries (other than (i) inventory or goods
sold in the ordinary course of business, (ii) any other assets to the extent
that the aggregate fair market value of such assets sold during any Fiscal Year
is less than or equal to $2,000,000 and the sale of such assets does not
constitute a breach under the Phase II Mall Sale Agreement or (iii) any
sales, transfers or dispositions permitted by subsection 6.6).

 

“Assignment Agreement”
means an Assignment Agreement in substantially the form of Exhibit C-1
annexed hereto.

 

“Assignment
Effective Date” is defined in subsection 9.1B(ii).

 

“Assignment of Phase II Mall Sale Agreement”
means that certain Collateral Assignment of Phase II Mall Sale Agreement, dated
as of the date hereof, between Phase II Mall Subsidiary Holding and the
Administrative Agent, in substantially the form of Exhibit D-5 hereto.

 

3

 

“Assignment of Rate Protection Agreement”
means that certain Assignment of Rate Protection Agreement, dated as of the
date of the Rate Protection Agreements being assigned in accordance with Section
5.12, between Borrowers, the Administrative Agent and the counterparty to
such Rate Protection Agreements, in substantially the form of Exhibit D-6
hereto.

 

“Authorized Officer”
means, relative to either of the Borrowers, those of its officers, general
partners or managing members (as applicable) or those of the officers of the
general partners or managing members (as applicable) whose signatures and
incumbency shall have been certified to the Administrative Agent and the
Lenders pursuant to subsection 3.1A.

 

“Bank Administrative Agent” means the
“Administrative Agent” under the Bank Facilities Agreement.

 

“Bank Facilities” means the loans and other
credit facilities to be made by the Bank Lenders to the Bank Loan Parties
pursuant to the Bank Facilities Agreement.

 

“Bank Facilities Agreement” means that
certain Credit Agreement, dated as of August 20, 2004 by and between LVSI and
Venetian, as the borrowers, the Bank Lenders, as the lenders, Goldman Sachs
Credit Partners, L.P., as the syndication agent, the sole lead arranger and the
sole bookrunner, Scotia Capital, as the administrative agent, and Wells Fargo
Foothill, Inc., CIT Group/Equipment Financing, Inc. and Commerzbank AG, as the
documentation agents pursuant to which the Bank Lenders have agreed to provide
certain loans to LVSI and Venetian, in an aggregate amount of $1,010,000,000 as
the same may be amended, supplemented, amended and restated, or otherwise
modified in accordance with its terms.

 

“Bank Facilities Loan Documents” means the
Bank Facilities Agreement together with all related agreements, instruments and
documents executed or delivered pursuant thereto at any time (including all
mortgages, guarantees, security agreements and all other collateral and
security documents), in each case as such agreements, instruments and documents
may be amended, supplemented, amended and restated, or otherwise modified in
accordance with the terms thereof.

 

“Bank Lenders” means the Persons which are
defined as “Lenders” in the Bank Facilities Agreement.

 

“Bank Loan Parties” means the Persons which
are defined as “Loan Parties” in the Bank Facilities Agreement

 

“Bankruptcy Code”
means Title 11 of the United States Code entitled “Bankruptcy”, as now and
hereafter in effect, or any successor statute.

 

“Base Rate”
means, at any time, the higher of (a) the Prime Rate or (b) the rate
which is 1/2 of 1% in excess of the Federal Funds Effective Rate.

 

“Base Rate Loans”
means Loans bearing interest at rates determined by reference to the Base Rate
as provided in subsection 2.2A.

 

4

 

“Borrowers”
is defined in the preamble and shall mean, as the context requires, either or
both of the Borrowers.

 

“Borrowing”
means Loans of the same type and, in the case of Eurodollar Rate Loans, having
the same Interest Period made by the Lenders on the same Business Day and pursuant
to the same Borrowing Notice in accordance with subsection 2.1B.

 

“Borrowing Notice”
means a notice substantially in the form of Exhibit B-1 annexed
hereto delivered by the Borrowers to the Administrative Agent pursuant to subsection
2.1B with respect to a proposed Borrowing.

 

“Bovis”
means Lehrer McGovern Bovis Inc., a New York corporation.

 

“Business Day”
means (a) for all purposes other than as covered by clause (b) below,
any day excluding Saturday, Sunday and any day which is a legal holiday under
the laws of the State of New York or Nevada or the Province of British Columbia
or is a day on which banking institutions located in either such state or such
province are authorized or required by law or other governmental action to
close, and (b) with respect to all notices, determinations, fundings and
payments in connection with the Adjusted Eurodollar Rate or any Eurodollar Rate
Loans, any day that is a Business Day described in clause (a) above and
that is also a day for trading by and between banks in Dollar deposits in the
London interbank market.

 

“Capital Expenditures” means the sum of (a)
expenditures (whether paid in cash or other consideration or accrued as a
liability and including that portion of Capital Leases which is capitalized on
the consolidated balance sheet of the Borrowers) by the Borrowers and their
Subsidiaries that, in conformity with GAAP, are included in “additions to
property, plant or equipment” or comparable items reflected in the financial
statements of the Borrowers and their Subsidiaries plus (b) to the
extent not covered by clause (a) of this definition, any expenditures by
the Borrowers or their Subsidiaries to acquire (by purchase or otherwise) the
business, property or fixed assets of any Person, or the stock or other evidence
of beneficial ownership of any Person that, as a result of such acquisition,
becomes a Subsidiary of the Borrowers.

 

“Capital Lease”,
as applied to any Person, means any lease of any property (whether real,
personal or mixed) by that Person as lessee that, in conformity with GAAP, is
accounted for as a capital lease on the balance sheet of that Person.  For purposes of this Agreement and each
other Loan Document, the amount of a Person’s obligation under a Capital Lease
shall be the capitalized amount thereof, 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 premium or a
penalty.

 

“Cash”
means money, currency or a credit balance (in each case denominated in Dollars)
in a Deposit Account.

 

“Cash Equivalents”
means (a) Dollars, (b) (i) direct obligations of the United States
(including obligations issued or held in book-entry form on the books of the
Department of the Treasury of the United States) or obligations fully
guaranteed by the United States, (ii) obligations, debentures, notes or
other evidence of indebtedness issued or guaranteed by any

 

5

 

other agency or
instrumentality of the United States, (iii) interest-bearing demand or
time deposits (which may be represented by certificates of deposit) issued by
banks having general obligations rated (on the date of acquisition thereof) at
least “A” or the equivalent by Standard & Poor’s Ratings Group, a division
of McGraw Hill, Inc., or Moody’s Investors Service, Inc. (together with their
respective successors and with any other nationally recognized credit rating
agency if neither of such corporations is then currently rating the pertinent
obligations, a “Rating Agency”)
or, if not so rated, secured at all times, in the manner and to the extent
provided by law, by collateral security in clause (i) or (ii)
of this definition, of a market value of no less than the amount of monies so
invested, (iv) commercial paper rated (on the date of acquisition thereof)
at least “A-1” or “P-1” or the equivalent by any Rating Agency issued by any
Person, (v) repurchase obligations for underlying securities of the types
described in clause (i) or (ii) above, entered into
with any commercial bank or any other financial institution having long-term
unsecured debt securities rated (on the date of acquisition thereof) at least “A”
or “A2” or the equivalent by any Rating Agency in connection with which such
underlying securities are held in trust or by a third-party custodian,
(vi) guaranteed investment contracts of any financial institution which
has a long-term debt rated (on the date of acquisition thereof) at least “A” or
“A2” or the equivalent by any Rating Agency, (vii) obligations (including
both taxable and non-taxable municipal securities) issued or guaranteed by, and
any other obligations the interest on which is excluded from income for Federal
income tax purposes issued by, any state of the United States or District of
Columbia or the Commonwealth of Puerto Rico or any political subdivision,
agency, authority or instrumentality thereof, which issuer or guarantor has (A) a
short-term debt rated (on the date of acquisition thereof) at least “A-1” or
“P-1” or the equivalent by any Rating Agency and (B) a long-term debt
rated (on the date of acquisition thereof) at least “A” or “A2” or the
equivalent by any Rating Agency, (viii) investment contracts of any
financial institution either (A) fully secured by (1) direct
obligations of the United States, (2) obligations of a Person controlled
or supervised by and acting as an agency or instrumentality of the United
States or (3) securities or receipts evidencing ownership interest in
obligations or special portions thereof described in clause (1) or (2),
in each case guaranteed as full faith and credit obligations of the United
States, having a market value at least equal to 102% of the amount deposited
thereunder, or (B) with long-term debt rated (on the date of acquisition
thereof) at least “A” or “A2” or the equivalent by any Rating Agency and
short-term debt rated (on the date of acquisition thereof) at least “A-1” or
“P-1” or the equivalent by any Rating Agency, (ix) a contract or investment
agreement with a provider or guarantor (A) which provider or guarantor is
rated (on the date of acquisition thereof) at least “A” or “A2” or the
equivalent by any Rating Agency (provided that if a guarantor is a party to the
rating, the guaranty must be unconditional and must be confirmed in writing
prior to any assignment by the provider to any subsidiary of such guarantor),
(B) providing that monies invested shall be payable to the Administrative Agent
without condition (other than notice) and without brokerage fee or other
penalty, upon not more than two Business Days’ notice for application when and
as required or permitted under the Collateral Documents, and (C) stating that
such contract or agreement is unconditional, expressly disclaiming any right of
setoff and providing for immediate termination in the event of insolvency of
the provider and termination upon demand of the Administrative Agent (which
demand shall only be made at the direction of the Borrowers) after any payment
or other covenant default by the provider, or (x) any debt instruments of
any Person which instruments are rated (on the date of acquisition thereof) at
least “A,” “A2”, “A-1” or “P-1” or the equivalent by any Rating Agency, provided
that in each case of clauses (i) through (x), such
investments are

 

6

 

denominated in
Dollars and maturing not more than 13 months from the date of acquisition
thereof; (c) investments in any money market fund which is rated (on the
date of acquisition thereof) at least “A” or “A2” or the equivalent by any
Rating Agency; (d) investments in mutual funds sponsored by any securities
broker-dealer of recognized national standing having an investment policy that
requires substantially all the invested assets of such fund to be invested in
investments described in any one or more of the foregoing clauses and having a
rating of at least “A” or “A2” or the equivalent by any Rating Agency; or (e) investments
in both taxable and nontaxable (i) periodic auction reset securities which
have final maturities between one and 30 years from the date of issuance
and are repriced through a Dutch auction or other similar method every 35 days
or (ii) auction preferred shares which are senior securities of leveraged
closed end municipal bond funds and are repriced pursuant to a variety of rate
reset periods, in each case having a rating (on the date of acquisition
thereof) of at least “A” or “A2” or the equivalent of any Rating Agency.

 

“Central Park West Site” means the
approximately 15 acres of real property owned by LVSI located near the
intersection of Sands Avenue and Koval Lane upon which an apartment complex
commonly known as Central Park West Apartments is currently located.

 

“Central Plant”
means the “Electric Substation” and the “HVAC Space”, as each such term is
defined in the Cooperation Agreement.

 

“Certificate of
Non-Bank Status” means a certificate substantially in the form of Exhibit C-2
annexed hereto delivered by a Lender to the Administrative Agent pursuant to subsection 2.7B(iii).

 

“Change of Control”
means any sale, pledge or other transfer (excluding any transfer of Securities
by Adelson for the purposes of providing estate planning and gifts reasonably
acceptable to the Administrative Agent) of Securities whereby (a) prior to the
occurrence of a public equity offering by LVSI, Adelson and/or his Affiliates
or Related Parties cease to own, directly or indirectly, at least 70% of the
voting Securities of LVSI, (b) after giving effect to the sale of the
Securities of LVSI or Holdco in one or more public equity offerings, (i)
Adelson and/or his Affiliates or Related Parties cease to own, directly or
indirectly, at least 35% of the voting Securities of LVSI, or (ii) any Person
or group of Persons (other than Adelson and/or his Affiliates or Related
Parties) owns, directly or indirectly, a greater percentage of the voting
Securities of LVSI than Adelson and/or his Affiliates or Related Parties, (c)
subject to exceptions approved by the Administrative Agent (in advance of any
relevant sales or transfers by LVSI) for tax planning purposes in connection
with an initial public offering, LVSI ceases to own (either directly or
indirectly through one or more Subsidiary Guarantors) 100% of the common equity
interests of Venetian or while such preferred stock is outstanding, LVSI or a
Subsidiary of LVSI ceases to own 100% of the preferred equity interests of
Venetian, (d) Venetian and LVSI cease to own directly or indirectly 100% of the
equity Securities of each of the Borrowers prior to the Phase II Mall Sale, or
(e) a “Change of Control” (or similar term) as defined in the Mortgage Notes
Indenture, the Bank Facilities Agreement or other instrument evidencing Indebtedness
of Venetian and/or LVSI permitted under the Bank Facilities Agreement issued
after the Closing Date (as defined in the Bank Facilities Agreement) in excess
of $50,000,000 shall occur.  The IPO
Restructuring and the sale by Phase II Mall Subsidiary Holding of equity
interests of Phase

 

7

 

II Mall Subsidiary
pursuant to the Phase II Mall Sale shall not be a “change of control” under
this Agreement.

 

“Closing Date”
means the date on which all conditions set forth in subsection 3.1 have
been satisfied and this Agreement becomes effective in accordance with subsection
9.21.

 

“Code”
means the Internal Revenue Code of 1986, as amended to the date hereof and from
time to time hereafter, and any successor statute.

 

“Collateral”
means, collectively, all of the real, personal and mixed property in which
Liens are granted pursuant to the Collateral Documents as security for the
Obligations.

 

“Collateral Account
Agreement” means that certain Disbursement Collateral Account
Agreement, dated as of the date hereof, among the Borrowers, the Disbursement
Agent and the Administrative Agent, in substantially the form of Exhibit D-4
hereto.

 

“Collateral
Documents” means the Security Agreement, the Deed of Trust, the
Collateral Account Agreement, the Assignment of Phase II Mall Sale Agreement,
the Assignment of Rate Protection Agreement and all other instruments or
documents delivered by one or both of the Borrowers or any Subsidiary of a
Borrower which is a party to any of the Loan Documents in order to grant to the
Administrative Agent on behalf of the Secured Parties, a Lien (or to perfect
such Lien) on any Collateral as security for the Obligations.

 

“Commitment”
means the commitment of a Lender to make Loans as set forth in subsection 2.1A,
and “Commitments” means such
commitments of all Lenders in the aggregate.

 

“Commitment Amount” means, on any date,
relative to any Lender, the Commitment of such Lender reduced by the principal
amount of any Loans made by such Lender as of such date.

 

“Commitment Termination Date” means the
earliest of:

 

(i)       the Business Day immediately prior to the
Maturity Date;

 

(ii)      the Phase II Mall Release Date; and

 

(iii)     the date on which any Commitment
Termination Event occurs.

 

Upon the occurrence of
any event described in clauses (i), (ii) or (iii), the
Commitments shall terminate automatically and without further action.

 

“Commitment
Termination Event” means (a) the occurrence of any Event of Default
with respect to either Borrower described in subsection 7.6 or 7.7,
(b) the occurrence and continuance of any other Event of Default and either (i)
the declaration of all or any portion of the Loans to be due and payable, or
(ii) the giving of notice by the Administrative Agent, acting at the direction
of the Requisite Lenders, to the Borrowers that the Commitments have been
terminated.

 

8

 

“Consents”
means the consents to the collateral assignment by the Borrowers of the Project
Documents, as required by the terms of the Loan Documents.

 

“Construction
Consultant” means Tishman Construction Corporation of Nevada, or any
other Person designated from time to time under the Disbursement Agreement by
the Disbursement Agent to serve as the Construction Consultant.

 

“Construction
Litigation” has the meaning assigned to that term in Section 4.16.

 

“Construction
Management Agreement” has the meaning given in the Disbursement
Agreement.

 

“Contingent
Obligation”, as applied to any Person, means any direct or indirect
liability, contingent or otherwise, of that Person (a) with respect to any
Indebtedness, lease, dividend or other obligation of another if the primary
purpose or intent thereof by the Person incurring the Contingent Obligation is
to provide assurance to the obligee of such obligation of another that such
obligation of another will be paid or discharged, or that any agreements
relating thereto will be complied with, or that the holders of such obligation
will be protected (in whole or in part) against loss in respect thereof,
(b) with respect to any letter of credit issued for the account of that
Person or as to which that Person is otherwise liable for reimbursement of
drawings, or (c) under Hedging Agreements.  Contingent Obligations shall include (a) the direct or indirect
guaranty, endorsement (otherwise than for collection or deposit in the ordinary
course of business), co-making, discounting with recourse or sale with recourse
by such Person of the obligation of another, (b) the obligation to make take-or-pay
or similar payments if required regardless of non-performance by any other
party or parties to an agreement, and (c) any liability of such Person for the
obligation of another through any agreement (contingent or otherwise)
(i) to purchase, repurchase or otherwise acquire such obligation or any
security therefor, or to provide funds for the payment or discharge of such
obligation (whether in the form of loans, advances, stock purchases, capital
contributions or otherwise) or (ii) to maintain the solvency or any
balance sheet item, level of income or financial condition of another if, in
the case of any agreement described under subclauses (i) or (ii)
of this sentence, the primary purpose or intent thereof is as described in the
preceding sentence.  The amount of any
Contingent Obligation shall be equal to the amount of the obligation so
guaranteed or otherwise supported or, if less, the amount to which such
Contingent Obligation is specifically limited. 
Notwithstanding the foregoing, Contingent Obligations shall not include
any surety bonds for claims underlying mechanics liens and any reimbursement
obligations with respect thereto so long as such reimbursement obligations are
not then due or are promptly paid when due.

 

“Contractors”
means any architects, consultants, designers, contractors, sub-contractors,
suppliers, laborers or any other Person engaged by either or both of the
Borrowers in connection with the design, engineering, installation and
construction of the Phase II Mall or by LCR in connection with the design,
engineering, installation and construction of the Phase II Project.

 

“Contracts”
means, collectively, the contracts entered into, from time to time, between
either of both of the Borrowers or LCR and any Contractor for performance of
services or sale of goods in connection with the design, engineering,
installation or construction of the Phase II Mall.

 

9

 

“Contractual
Obligation” means, as applied to any Person, any provision of any
Security issued by that Person or of any material indenture, mortgage, deed of
trust, contract, undertaking, agreement or other instrument to which that
Person is a party or by which it or any of its properties is bound or to which
it or any of its properties is subject.

 

“Conversion/Continuation
Notice” means a notice substantially in the form of Exhibit B-2
annexed hereto delivered to the Administrative Agent pursuant to subsection
2.2D with respect to a proposed conversion or continuation of the
applicable basis for determining the interest rate with respect to the Loans
specified therein.

 

“Cooperation
Agreement” means  that
certain Second Amended and Restated Reciprocal Easement, Use and Operating
Agreement, dated as of May 17, 2004, as amended as of July 30, 2004, by and
between Venetian, LCR, Grand Canal and Interface.

 

“COREA”
has the meaning given in the Disbursement Agreement.

 

“Credit Extension”
means the making of a Loan by a Lender.

 

“Debt Service” means all principal
repayments or interest and other amounts (including commitment fees) payable or
accrued from time to time under this Agreement and the other Loan Documents.

 

“Deed of Trust”
means the Deed of Trust, Leasehold Deed of Trust, Assignment of Rents and
Leases, Security Agreement and Fixture Filing, dated as of the Closing Date,
granted by the Borrowers to the Title Company, for the benefit of the
Administrative Agent, as agent for the Secured Parties, substantially in the
form of Exhibit D-1 annexed hereto.

 

“Deposit Account”
means a demand, time, savings, passbook or like account with a bank, savings
and loan association, credit union or like organization, other than an account
evidenced by a negotiable certificate of deposit.

 

“Disbursement
Account” has the meaning given in the Collateral Account Agreement.

 

“Disbursement Agent” has the meaning given in the
Disbursement Agreement.

 

“Disbursement
Agreement” means the Master Disbursement Agreement, dated as of the
Closing Date, by and among the Administrative Agent, the Bank Facilities
Administrative Agent, the Disbursement Agent, the Borrowers and LCR, in
substantially the form of Exhibit D-3 hereto, as the same may be
amended, supplemented, amended and restated, or otherwise modified in
accordance with the terms hereof and thereof.

 

“Dollars”
and the sign “$” mean the lawful
money of the United States.

 

“Eligible Assignee”
means (a) (i) a commercial bank organized under the laws of the United
States or any state thereof; (ii) a savings and loan association or
savings bank organized under the laws of the United States or any state
thereof; (iii) a commercial bank organized under the laws of any other
country or a political subdivision thereof; provided that (x) such
bank is acting through a branch or agency located in the United States or
(y) such bank is organized

 

10

 

under the laws of
a country that is a member of the Organization for Economic Cooperation and
Development or a political subdivision of such country; and (iv) any other
Person which is an “accredited investor” (as defined in Regulation D under the
Securities Act) which extends credit or buys loans as one of its businesses
including insurance companies, mutual funds and lease financing companies; (b)
any Approved Fund; and (c) any Lender and any Affiliate of any Lender; provided
that no Borrower, any Affiliate of the Borrowers, Adelson and/or his Affiliates
or Related Parties shall be an Eligible Assignee; provided  further
that so long as no Event of Default shall have occurred and be continuing, no
(i) Person that owns or operates a casino located in Macau, the United Kingdom,
the State of Nevada or the State of New Jersey (or is an Affiliate of such a
Person) (provided that a passive investment constituting less than 20%
of the common stock of any such casino shall not constitute ownership thereof
for the purposes of this definition), (ii) Person that owns or operates a
trade show, convention, exhibition or conference center in Macau, the United
Kingdom, Las Vegas, Nevada or Clark County, Nevada (or an Affiliate of such a
Person) (provided that a passive investment constituting less than 20%
of the common stock of any such trade show, convention, exhibition or
conference center shall not constitute ownership for the purpose of this
definition), or (iii) union pension fund (provided that any intermingled
fund or managed account which has as part of its assets under management the
assets of a union pension fund shall not be disqualified from being an Eligible
Assignee hereunder so long as the manager of such fund is not controlled by a
union), shall be an Eligible Assignee, in each case which Person shall not have
been denied an approval or a license, or found unsuitable under the Nevada
Gaming Laws applicable to Lenders.

 

“Employee Benefit Plan”
means any “employee benefit plan” as defined in Section 3(3) of ERISA which is
or was maintained or contributed to by the Borrowers, any of their Subsidiaries
or any of their respective ERISA Affiliates.

 

“Environmental Claim”
means any investigation, notice, notice of violation, claim, action, suit,
proceeding, demand, abatement order or other order or directive (conditional or
otherwise), by any Governmental Instrumentality or any other Person, arising
(a) pursuant to or in connection with any actual or alleged violation of any
Environmental Law, (b) in connection with any Hazardous Materials or any actual
or alleged Hazardous Materials Activity, or (c) in connection with any actual
or alleged damage, injury, threat or harm to health, safety, natural resources
or the environment.

 

“Environmental
Indemnity” means the Environmental Indemnity in the form of Exhibit
H hereto, dated as of the Closing Date, granted by the Borrowers, LCR,
Venetian and LVSI to the Administrative Agent for the benefit of the Lenders.

 

“Environmental Laws”
means any and all current or future statutes, ordinances, orders, rules,
regulations, guidance documents, judgments, Permits, or any other requirements
of Governmental Instrumentalities relating to (a) environmental matters,
including those relating to any Hazardous Materials Activity, (b) the
generation, use, storage, transportation or disposal of Hazardous Materials, or
(c) occupational safety and health, industrial hygiene, land use or the
protection of human, plant or animal health or welfare, in any manner
applicable to the Borrowers or any of their Subsidiaries or any of their
Facilities, including the Comprehensive Environmental Response, Compensation,
and Liability Act (42 U.S.C. § 9601 et  seq.), the Hazardous
Materials Transportation Act (49 U.S.C. § 1801 et  seq.), the
Resource Conservation

 

11

 

and Recovery Act
(42 U.S.C. § 6901 et  seq.), the Federal Water Pollution
Control Act (33 U.S.C. § 1251 et  seq.), the Clean Air Act (42
U.S.C. § 7401 et  seq.), the Toxic Substances Control Act (15
U.S.C. § 2601 et seq.), the Federal Insecticide,
Fungicide and Rodenticide Act (7 U.S.C. §136 et  seq.), the
Occupational Safety and Health Act (29 U.S.C. § 651 et  seq.),
the Oil Pollution Act (33 U.S.C. § 2701 et  seq.), the
Emergency Planning and Community Right-to-Know Act (42 U.S.C. § 11001 et
seq.), the Nevada Hazardous Materials law (NRS Chapter 459), the Nevada
Solid Waste/Disposal of Garbage or Sewage law (NRS 444.440 to 444.650, inclusive),
the Nevada Water Controls/Pollution law (NRS Chapter 445A), the Nevada Air
Pollution law (NRS Chapter 445B), the Nevada Cleanup of Discharged Petroleum
law (NRS 590.700 to 590.920, inclusive), the Nevada Control of Asbestos law
(NRS 618.750 to 618.850), the Nevada Appropriation of Public Waters law (NRS
533.324 to 533.4385, inclusive), the Nevada Artificial Water Body Development
Permit law (NRS 502.390), the Nevada Protection of Endangered Species,
Endangered Wildlife Permit (NRS 503.585), Endangered Flora Permit law (NRS
527.270), the Atomic Energy Act of 1954 (42 U.S.C. Section 2011 et. seq.),
the Safe Drinking Water Act (42 U.S.C. Sections 300f et. seq.),
the Surface Mining Control and Reclamation Act of 1974 (30 U.S. C. Sections
1201 et. seq.), and the Uranium Mill Tailings Radiation Control
Act of 1978 (42 U.S.C. Section 7901 et. seq.), each as amended or
supplemented, any analogous present or future state or local statutes or laws,
and any regulations promulgated pursuant to any of the foregoing.

 

“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended from time
to time, and any successor thereto.

 

“ERISA Affiliate”
means, as applied to any Person, (a) any corporation which is a member of
a controlled group of corporations within the meaning of Section 414(b) of the
Code of which that Person is a member; (b) any trade or business (whether or
not incorporated) which is a member of a group of trades or businesses under
common control within the meaning of Section 414(c) of the Code of which that
Person is a member; and (c) any member of an affiliated service group within
the meaning of Section 414(m) or (o) of the Code of which that Person, any
corporation described in clause (a) above or any trade or business
described in clause (b) above is a member.  Any former ERISA Affiliate of the Borrowers or any of their
Subsidiaries shall continue to be considered an ERISA Affiliate of the
Borrowers or such Subsidiary within the meaning of this definition with respect
to the period such entity was an ERISA Affiliate of the Borrowers or such
Subsidiary and with respect to liabilities arising after such period for which
Borrowers or such Subsidiary could be liable under the Code or ERISA.

 

“ERISA Event”
means (a) a “reportable event” within the meaning of Section 4043 of ERISA and
the regulations issued thereunder with respect to any Pension Plan (excluding
those for which the provision for 30-day notice to the PBGC has been waived by
regulation); (b) the failure to meet the minimum funding standard of Section
412 of the Code with respect to any Pension Plan (whether or not waived in
accordance with Section 412(d) of the Code) or the failure to make by its due
date a required installment under Section 412(m) of the Code with respect to
any Pension Plan or the failure to make any required contribution to a
Multiemployer Plan; (c) the provision by the administrator of any Pension Plan
pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such
plan in a distress termination described in Section 4041(c) of ERISA; (d) the
withdrawal by the Borrowers, any of their Subsidiaries or any of their
respective ERISA Affiliates from any Pension Plan with two or more contributing

 

12

 

sponsors or the
termination of any such Pension Plan resulting in liability pursuant to Section
4063 or 4064 of ERISA; (e) the institution by the PBGC of proceedings to
terminate any Pension Plan, or the occurrence of any event or condition which
might constitute grounds under ERISA for the termination of, or the appointment
of a trustee to administer, any Pension Plan; (f) the imposition of liability
on Borrowers, any of their Subsidiaries or any of their respective ERISA
Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of the
application of Section 4212(c) of ERISA; (g) the withdrawal of the Borrowers,
any of their Subsidiaries or any of their respective ERISA Affiliates in a
complete or partial withdrawal (within the meaning of Sections 4203 and 4205 of
ERISA) from any Multiemployer Plan if there is any potential liability
therefor, or the receipt by the Borrowers, any of their Subsidiaries or any of
their respective ERISA Affiliates of notice from any Multiemployer Plan that it
is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA,
or that it intends to terminate or has terminated under Section 4041A or 4042
of ERISA; (h) the occurrence of an act or omission which could give rise to the
imposition on Borrowers, any of their Subsidiaries or any of their respective
ERISA Affiliates of fines, penalties, taxes or related charges under Chapter 43
of the Code or under Section 409, Section 502(c), (i) or (l), or Section 4071
of ERISA in respect of any Employee Benefit Plan; (i) the assertion of a
material claim (other than routine claims for benefits) against any Employee
Benefit Plan other than a Multiemployer Plan or the assets thereof, or against
Borrowers, any of their Subsidiaries or any of their respective ERISA
Affiliates in connection with any Employee Benefit Plan; (j) receipt from the
PBGC of notice of the failure of any Pension Plan (or any other Employee
Benefit Plan intended to be qualified under Section 401(a) of the Code) to
qualify under Section 401(a) of the Code, or the failure of any trust forming
part of any Pension Plan to qualify for exemption from taxation under Section
501(a) of the Code; or (k) the imposition of a Lien pursuant to Section
401(a)(29) or 412(n) of the Code or pursuant to ERISA with respect to any
Pension Plan.

 

“Eurodollar Rate
Loans” means Loans bearing interest at rates determined by reference
to the Adjusted Eurodollar Rate as provided in subsection 2.2A.

 

“Event of Default”
is defined in Section 7.

 

“Event of Loss”
means, with respect to any property or asset (tangible or intangible, real or
personal), any of the following: 
(a) any loss, destruction or damage of such property or asset;
(b) any actual condemnation, seizure or taking by exercise of the power of
eminent domain or otherwise of such property or asset, or confiscation of such
property or asset or the requisition of the use of such property or asset; or
(c) any settlement in lieu of clause (b) above.

 

“Exchange Act”
means the Securities Exchange Act of 1934, as amended from time to time, and
any successor statute.

 

“Excluded Subsidiaries” has the meaning
given in the Bank Facilities Agreement.

 

“Existing Facility”
means the Venetian Casino Resort, a Venetian-themed hotel, casino, retail,
meeting and entertainment complex located at 3355 Las Vegas Boulevard South,
Clark County, Nevada.

 

“Existing Site”
means the land on which the Existing Facility is constructed.

 

13

 

“Facilities”
means any and all real property (including all buildings, fixtures or other
improvements located thereon) now, hereafter or heretofore owned, leased,
operated or used by the Borrowers or any of their Subsidiaries, including the
Phase II Mall.

 

“FDIC”
means the Federal Deposit Insurance Corporation.

 

“Federal Funds
Effective Rate” means, for any period, a fluctuating interest rate
equal for each day during such period to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published for such day (or, if such day
is not a Business Day, for the next preceding Business Day) by the Federal
Reserve Bank of New York, or, if such rate is not so published for any day
which is a Business Day, the average of the quotations for such day on such
transactions received by the Administrative Agent from three Federal funds
brokers of recognized standing selected by the Administrative Agent.

 

“Final Completion”
has the meaning given in the Disbursement Agreement.

 

“Final Completion Date”
means the date on which Final Completion occurs.

 

“First Priority”
means, with respect to any Lien created in any Collateral pursuant to any
Collateral Document, that such Lien is the only Lien (other than Permitted
Liens) to which such Collateral is subject.

 

“Fiscal Quarter”
means a fiscal quarter of any Fiscal Year.

 

“Fiscal Year”
means the fiscal year of the Borrowers ending on December 31 of each calendar
year.

 

“Former Lender”
is defined in subsection 9.7(a).

 

“Funding and Payment
Office” means (a) the office of the Administrative Agent located at
600 Peachtree Street NE, Suite 2700, Atlanta, Georgia 30308 (Attention: Hilda
Gabbidon or Vicki Gibson) or (b) such other office of the Administrative Agent
or of a third party or sub-agent, as appropriate, as may from time to time
hereafter be designated as such in a written notice delivered by the
Administrative Agent to the Borrowers and each Lender.

 

“Funding Date”
means the date of the funding of a Loan.

 

“GAAP”
means, subject to the limitations on the application thereof set forth in subsection
1.2, generally accepted accounting principles set forth in opinions and
pronouncements of the Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such other entity as
may be approved by a significant segment of the accounting profession, in each
case, as the same are applicable to the circumstances as of the Closing Date.

 

“Gaming License”  means every license, franchise or other
authorization to own, lease, operate or otherwise conduct gaming activities of
LVSI, VCR or any of their Restricted

 

14

 

Subsidiaries,
including all such licenses granted under the Nevada Gaming Laws, and other
applicable federal, state, foreign or local laws.

 

“GGP” means GGP Limited Partnership, a Delaware limited
partnership, and any successor thereto by merger or by operation of law.

 

“Governmental
Instrumentality” means any national, state or local government
(whether domestic or foreign), any political subdivision thereof or any other
governmental, quasi-governmental, judicial, public or statutory
instrumentality, authority, body, agency, bureau or entity, (including the
Nevada Gaming Authorities, any zoning authority, the FDIC, the Comptroller of
the Currency or the Federal Reserve Board, any central bank or any comparable
authority) or any arbitrator with authority to bind a party at law.

 

“Grand Canal” means Grand Canal Shops II,
LLC.

 

“Harrah’s Shared
Roadway Agreement” means the Agreement, dated as of January 16,
1998, between Venetian and Harrah’s Casino Resort.

 

“Hazardous Materials”
means (a) any chemical, material or substance at any time defined as or
included in the definition of “hazardous substances”, “hazardous wastes”,
“hazardous materials”, “extremely hazardous waste”, acutely hazardous waste”,
“radioactive waste”, “biohazardous waste”, “pollutant”, “toxic pollutant”,
“contaminant”, “restricted hazardous waste”, “infectious waste”, “toxic
substances”, or any other term or expression intended to define, list or
classify substances by reason of properties harmful to health, safety or the
indoor or outdoor environment (including harmful properties such as
ignitability, corrosivity, reactivity, carcinogenicity, toxicity, reproductive
toxicity, “TCLP toxicity” or “EP toxicity” or words of similar import under any
applicable Environmental Laws); (b) any oil, petroleum, petroleum fraction
or petroleum derived substance; (c) any drilling fluids, produced waters
and other wastes associated with the exploration, development or production of
crude oil, natural gas or geothermal resources; (d) any flammable
substances or explosives; (e) any radioactive materials; (f) any
asbestos-containing materials; (g) urea formaldehyde foam insulation;
(h) electrical equipment which contains any oil or dielectric fluid
containing polychlorinated biphenyls; (i) pesticides; and (j) any other
chemical, material or substance, exposure to which is prohibited, limited or
regulated by any Governmental Instrumentality or which may or could pose a
hazard to the health and safety of the owners, occupants or any Persons in the
vicinity of any Facility or to the indoor or outdoor environment.

 

“Hazardous Materials
Activity” means any past, current, proposed or threatened activity,
event or occurrence involving any Hazardous Materials, including the use,
manufacture, possession, storage, holding, presence, existence, location,
Release, threatened Release, discharge, placement, generation, transportation,
processing, construction, treatment, abatement, removal, remediation, disposal,
disposition or handling of any Hazardous Materials, and any corrective action
or response action with respect to any of the foregoing.

 

“Hedging Agreements”
means (a) currency exchange or interest rate swap agreements, currency exchange
or interest rate cap agreements and currency exchange or interest rate collar

 

15

 

agreements and (b)
other agreements or arrangements designed to protect against fluctuations in
currency exchange or interest rates.

 

“Holdco” means a corporation formed for the
purpose of selling its capital stock in an initial public offering which will
own 100% of the common stock of LVSI.

 

“HVAC Provider”
means Sempra Energy Solutions, a California corporation (successor to
Atlantic-Pacific, Las Vegas LLC, a Delaware limited liability company) or its
permitted successors under the HVAC Services Agreements.

 

“HVAC Services
Agreements” means all agreements between the HVAC Provider,
Venetian, LVSI, their Restricted Subsidiaries, the Borrowers or their
Subsidiaries for the provision of air conditioning or utility services which
pertain to or affect the Phase II Mall.

 

“Improvement Phasing Agreement” means the
Improvement Phasing Agreement, dated on or about August 11, 2004 between Clark
County, Nevada and LCR.

 

“In Balance” has the meaning given in the Disbursement Agreement.

 

“Included Taxes”
is defined in subsection 2.7B(i).

 

“Indebtedness”,
as applied to any Person, means (a) all indebtedness for borrowed money,
(b) that portion of obligations with respect to Capital Leases that is
properly classified as a liability on a balance sheet in conformity with GAAP,
(c) notes payable and drafts accepted representing extensions of credit
whether or not representing obligations for borrowed money, (d) any
obligation owed for all or any part of the deferred purchase price of property
or services (excluding any such obligations incurred under ERISA and trade
payables and accruals incurred in the ordinary course of business), and
(e) all indebtedness secured by any Lien on any property or asset owned or
held and under contracts by that Person regardless of whether the indebtedness
secured thereby shall have been assumed by that Person or is nonrecourse to the
credit of that Person.  Obligations
under Hedging Agreements constitute Contingent Obligations and not Indebtedness.  Obligations under the HVAC Services
Agreements, the Phase II Mall Lease and the Walgreens Lease shall be treated as
service contracts or operating leases and not as Indebtedness.  Additionally, Indebtedness shall not include
(i) any amount of the liability in respect of an operating lease that at
such time would not be required to be capitalized and reflected as a liability
on the balance sheet in accordance with GAAP, (ii) any surety bonds for
claims underlying mechanics liens and any reimbursement obligations with
respect thereto so long as such reimbursement obligations are not then due, or
are promptly paid when due or (iii) any indebtedness that has been either
satisfied or discharged or defeased through covenant defeasance or legal
defeasance.

 

“Indemnified
Liabilities” is defined in subsection 9.3.

 

“Indemnitees”
is defined in subsection 9.3.

 

“Independent
Financial Advisor” means an accounting, appraisal or investment
banking or financial advisory firm of nationally or internationally recognized
standing that is not an Affiliate of LVSI and Adelson and his Related Parties.

 

16

 

“Intercompany Mall Note” means a promissory
note or notes of the Borrowers, initially in the principal amount of
$25,371,098 (as such amount may be increased pursuant to subsection 6.1 (iv))
payable to Venetian, substantially in the form of Exhibit J hereto
(as such promissory note may be amended, endorsed or otherwise modified from
time to time), evidencing the Phase II Mall Contribution, and also means all
other promissory notes accepted from time to time in substitution therefor or
renewal thereof.

 

“Interest Payment
Date” means (a) with respect to any Loan that is a Base Rate Loan,
each Quarterly Payment Date and (b) with respect to any Loan that is a Eurodollar
Rate Loan, the last day of each Interest Period applicable to such Loan; provided,
however, that in the case of each Interest Period of longer than three
months “Interest Payment Date” shall also include each Quarterly Payment Date.

 

“Interest Period”
is defined in subsection 2.2B.

 

“Interest Rate
Determination Date” means, with respect to any Interest Period, two
Business Days prior to the first day of such Interest Period.

 

“Interface”
means Interface Group-Nevada, Inc., a Nevada corporation.

 

“Investment”
means, relative to any Person, (a) any direct or indirect purchase or
other acquisition by such Person of, or of a beneficial interest in, any
Securities of any other Person (including any Subsidiary), (b) any direct
or indirect purchase or other acquisition for value, by such Person from any
Person, of any equity Securities of any Person, or (c) any direct or
indirect loan, advance (other than advances to employees for moving,
entertainment and travel expenses, drawing accounts and similar expenditures in
the ordinary course of business) or capital contribution by such Person to any
other Person, including all Indebtedness and accounts receivable from that
other Person that are not current assets or did not arise from sales to that
other Person in the ordinary course of business other than Hedging Agreements
required or permitted hereunder to hedge against fluctuations of interest rates
or currency exchange risk.  The amount
of any Investment shall be the original cost of such Investment plus the
cost of all additions thereto, without any adjustments for increases or
decreases in value, or write-ups, write-downs or write-offs with respect to
such Investment less all returns of principal or equity thereon.

 

“IPO Restructuring”
means, in connection with the formation of Holdco, a restructuring in which (i)
LVSI will form Holdco as a wholly-owned subsidiary which, in turn, will form a
wholly-owned subsidiary (“Merger Co”),
(ii) LVSI will merge with and into Merger Co. with LVSI being the surviving
corporation, and (iii) the stockholders of LVSI immediately prior to the merger
described in clause (ii) will receive shares in Holdco in exchange for
their shares of common stock of LVSI. 
Upon completion of the merger described in clause (ii), Holdco
will own 100% of the common stock of LVSI.

 

“Joint Venture”
means a Supplier Joint Venture or any other joint venture, partnership or other
similar arrangement, whether in corporate, partnership, limited liability
company or other legal form; provided that in no event shall any
Subsidiary of any Person be considered to be a Joint Venture to which such
Person is a party.

 

17

 

“LCR” means Lido Casino Resort, LLC, a
Nevada limited liability company.

 

“Legal Requirements”
means all laws, statutes, orders, decrees, injunctions, licenses, Permits,
approvals, agreements and regulations of any Governmental Instrumentality
having jurisdiction over the matter in question.

 

“Lender”
and “Lenders” is defined in the
preamble, together with their successors and permitted assigns pursuant to subsection
9.1.

 

“Lien”
means, with respect to any asset, any mortgage, lien, pledge, charge, security
interest or encumbrance of any kind in respect of such asset, whether or not
filed, recorded or otherwise perfected under applicable law (including any
conditional sale or other title retention agreement or any lease in the nature
thereof).

 

“Lien Protection Account” has the meaning
given in the Disbursement Agreement.

 

“Line Item” means each of the individual
line items set forth in the Project Budget.

 

“Loan” or
“Loans” means the portion of the
Phase II Mall Construction Loan made by the Lenders to the Borrower pursuant to
subsection 2.1(B)(i).

 

“Loan Documents”
means this Agreement, the Notes, each Rate Protection Agreement, the Collateral
Documents, the Disbursement Agreement, and each other agreement that expressly
states by its terms that it is a Loan Document; provided, however
for the purposes of Section 4, subsections 7.1, 7.4, 7.5
and subsection 9.6, Rate Protection Agreements shall not be considered
to be a Loan Document.

 

“Loan Exposure” means, with respect to any
Lender as of the date of determination, the outstanding principal amount of the
Loans made by such Lender.

 

“LVSI”
means Las Vegas Sands, Inc. and its successors.

 

“Macau”
means the Macau Special Administrative Region of the People’s Republic of
China.

 

“MAI Appraisal”
means an appraisal conducted by a member of the Appraisal Institute in
accordance with the standards of the Appraisal Institute.

 

“Margin Stock”
has the meaning given in Regulation U of the Board of Governors of the Federal
Reserve System as in effect from time to time.

 

“Master Lease” has the meaning given in the
Disbursement Agreement.

 

“Material Adverse
Effect” means (a) a material adverse effect upon the business,
operations, properties, assets, condition (financial or otherwise) or prospects
of the Borrowers and their Subsidiaries, taken as a whole, or (b) the material
impairment of the ability of the Borrowers to observe or perform, or the
Administrative Agent or the Lenders to enforce, the Obligations.

 

18

 

“Material Contract”
means the Intercompany Mall Note and any Contract or other arrangement to which
either of the Borrowers, LCR or any of the Borrowers’ Subsidiaries are a party
(other than the Loan Documents) for which breach, nonperformance, cancellation
or failure to renew could reasonably be expected to have a Material Adverse
Effect.

 

“Maturity Date”
means, the earlier of (i) March 30, 2008 or (ii) the date on which the equity
interests of Phase II Mall Subsidiary are transferred, sold and assigned to GGP
in accordance with the Phase II Mall Sale Agreement.

 

“Mortgage Notes Indenture” means the
Indenture, dated as of June 4, 2002, as supplemented, among LVSI, Venetian,
U.S. Bank National Association, in its capacity as trustee under the Mortgage
Notes Indenture, and its successors in such capacity, and others.

 

“Mortgage Policy”
is defined in subsection 3.1E(ii).

 

“Mortgaged Property”
means the real property described in Schedule 4.5.

 

“Multiemployer Plan”
means any Employee Benefit Plan which is a “multiemployer plan” as defined in
Section 3(37) of ERISA.

 

“Net Asset Sale
Proceeds” means the aggregate cash proceeds received by either
Borrower or any of its Subsidiaries in respect of any Asset Sale, net of
(a) the direct costs relating to such Asset Sale (including legal,
accounting and investment banking fees and expenses, employee severance and
termination costs, any trade payables or similar liabilities related to the
assets sold and required to be paid by the seller as a result thereof and
sales, finders’ or broker’s commission), any relocation expenses incurred as a
result thereof and taxes paid or payable as result thereof (including any such
taxes paid or payable by an owner of any Borrower or any of its Subsidiaries),
(b) amounts required to be applied to the repayment of Indebtedness
secured by a Lien (or amounts permitted by the terms of such Indebtedness to be
otherwise reinvested in other assets of such Borrower or such Subsidiary to the
extent so reinvested) which is prior to the Lien under the Collateral Documents
on the asset or assets that are the subject of such Asset Sale, (c) all
distributions and other payments required to be made to minority interest
holders in a Subsidiary or joint venture as a result of such Asset Sale and
(d) any reserve for adjustment in respect of the sale price of such asset
or assets or any liabilities associated with the asset disposed of in such
Asset Sale and the deduction of appropriate amounts provided by the seller as a
reserve in accordance with GAAP against any liabilities associated with the
assets disposed of in the Asset Sale and retained by a Borrower or any Subsidiary.

 

“Net Loss Proceeds”
means the aggregate cash proceeds received by either Borrower or any of its
Subsidiaries in respect of any Event of Loss, including insurance proceeds from
condemnation awards or damages awarded by any judgment, net of the direct costs
in recovery of such Net Loss Proceeds (including legal, accounting, appraisal
and insurance adjuster fees and expenses) and any taxes paid or payable as a
result thereof (including any such taxes paid or payable by an owner of either
Borrower or any of its Subsidiaries) and amounts required to be applied to the
repayment of any Indebtedness secured by a Lien (or amounts permitted by the
terms of such Indebtedness to be otherwise reinvested in other assets of such
Borrower or such

 

19

 

Subsidiary to the
extent so reinvested) which is prior to the Liens of Lenders under the
Collateral Documents on the asset or assets that are the subject of the Event
of Loss.  Notwithstanding the foregoing,
all proceeds of so-called “liquidated damages”, “subguard” and “business
interruption” insurance policies shall not be Net Loss Proceeds.

 

“Net Proceeds”
is defined in subsection 2.4A(iii)(d).

 

“Net Proceeds Amount”
is defined in subsection 2.4A(iii)(e).

 

“Nevada Gaming
Authorities” shall mean, collectively, the Nevada Gaming Commission,
the Nevada State Gaming Control Board, and the Clark County Liquor and Gaming
Licensing Board.

 

“Nevada Gaming Laws”
shall mean the Nevada Gaming Control Act, as modified in Chapter 463 of the
Nevada Revised Statutes, as amended from time to time, and the regulations of
the Nevada Gaming Commission promulgated thereunder, as amended from time to
time.

 

“Non-Recourse
Financing” means Indebtedness incurred in connection with the
construction, installation, purchase or lease of personal or real property or
equipment (a) as to which the lender upon default may seek recourse or
payment against a Borrower or any of its Subsidiaries only through the return
or foreclosure or sale of the property or equipment so constructed, purchased
or leased and to any proceeds of such property and Indebtedness and the related
collateral account in which such proceeds are held and (b) may not otherwise
assert a valid claim for payment on such Indebtedness against a Borrower or any
of its Subsidiaries or any other property of a Borrower or any of its
Subsidiaries, except, in each of the foregoing clauses (a) and (b),
in the case of customary non-recourse exceptions, including fraud and
environmental indemnities.

 

“Non-US Lender”
is defined in subsection 2.7B(iii)(a).

 

“Note”
means a promissory note of the Borrowers payable to any Lender, in the form of Exhibit A
hereto (as such promissory note may be amended, endorsed or otherwise modified
from time to time), evidencing the aggregate Indebtedness of the Borrowers to
such Lender resulting from outstanding Loans, and also means all other
promissory notes accepted from time to time in substitution therefor or renewal
thereof.

 

“Obligations”
means all obligations of every nature of each Borrower from time to time owed
to the Administrative Agent and/or the Lenders (or in the case of a Rate
Protection Agreement, an Affiliate of a Lender) under the Loan Documents,
whether for principal, interest, premium, if any, fees, expenses,
indemnification or otherwise including interest accruing on the Loans during
the pendency of any proceeding of the type described in subsections 7.6
or 7.7, whether or not allowed in such proceeding.

 

“Officers’
Certificate” means, as applied to any corporation, a certificate
executed on behalf of such corporation by its chairman of the board (if an
officer) or its president or one of its vice presidents and by its chief
financial officer or its treasurer (in their capacity as such officer).

 

20

 

“Operating Lease”
means, as applied to any Person, any lease (including leases that may be
terminated by the lessee at any time) of any property (whether real, personal
or mixed) that is not a Capital Lease other than any such lease under which
that Person is the lessor.

 

“Operative Documents”
means the Loan Documents, the Resort Complex Operative Documents and the
Project Documents.

 

“Organizational
Documents” means (a) with respect to any corporation, its certificate
or articles of incorporation and its bylaws, (b) with respect to any limited
partnership, its certificate of limited partnership and its partnership
agreement, (c) with respect to any general partnership, its partnership
agreement, (d) with respect to any limited liability company, its articles or
certificate of organization and its operating agreement and (e) with respect to
any other entity, its equivalent organizational, governing documents.

 

“Patriot Act”
is defined in subsection 9.22.

 

“PBGC” means
the Pension Benefit Guaranty Corporation or any successor thereto.

 

“Pension Plan”
means any Employee Benefit Plan, other than a Multiemployer Plan, which is
subject to Section 412 of the Code or Section 302 of ERISA.

 

“Percentage” means, relative to any Lender,
the applicable percentage relating to Loans, as set forth opposite its
signature hereto or as set forth in an Assignment Agreement under the
applicable column heading, as such percentage may be adjusted from time to time
pursuant to Assignment Agreement(s) executed by such Lender and its Eligible
Assignee Lender(s) and delivered pursuant to subsection 9.1B.

 

“Permits”
means all material authorizations, consents, decrees, permits, waivers,
privileges, approvals from and filings with all Governmental Instrumentalities
necessary for the realization of the Phase II Project in accordance with the
Project Documents and the Resort Complex Operative Documents, the Plans and
Specifications, the Project Budget, and any other material building,
construction, land use, environmental or other material permit, license,
franchise, approval, consent and authorization (including planning board
approvals from applicable Governmental Instrumentalities and approvals required
under the Nevada Gaming Laws) required for or in connection with the
construction, ownership, use, occupation and operation of the Phase II Project
and the transactions provided for in this Agreement and the other Operative
Documents.

 

“Permitted Liens”
means the following types of Liens (excluding any such Lien imposed pursuant to
Section 401(a)(29) or 412(n) of the Code or by ERISA, any such Lien relating to
or imposed in connection with any Environmental Claim, any such Lien expressly
prohibited by any applicable terms of any of the Collateral Documents and any
such Lien (other than the Liens listed in clauses (i) and (ii) of
this definition) which is a Phase II Mall Title Defect (unless the amount
required in order to obtain the discharge of such Lien which is a Phase II Mall
Title Defect is included in the Project Budget as a Line Item, the Borrowers
are in compliance with Section 5.5 of the Disbursement Agreement and the
Borrowers have demonstrated to the Administrative Agent in its sole
determination that such Lien can and will be removed prior to the anticipated
Phase II Mall Release Date)):

 

21

 

(i)       Liens granted pursuant to the Collateral
Documents;

 

(ii)      Liens securing the Intercompany Mall Note
and the other Phase II Mall Contribution Documents; provided that such
Liens are subordinate to the Liens held by the Administrative Agent for the
benefit of the Lenders;

 

(iii)     Liens existing on the Closing Date and
described in Schedule 6.2 annexed hereto;

 

(iv)     Liens for taxes, assessments or governmental
charges or claims the payment of which is not, at the time, required by subsection
5.3;

 

(v)      statutory Liens of landlords, statutory
Liens of banks and rights of set-off, statutory Liens of carriers,
warehousemen, mechanics, repairmen, workmen and materialmen, and other Liens
imposed by law, in each case incurred in the ordinary course of business or in
connection with the construction of the Phase II Mall (a) for amounts not
yet overdue, (b) for amounts that are overdue and that (in the case of any
such amounts overdue for a period in excess of 5 days) are being contested in
good faith by appropriate proceedings, so long as (1) such reserves
(including through funds on deposit in the Lien Protection Account which, in
the aggregate with all amounts on deposit therein shall not exceed $20,000,000)
or other appropriate provisions, if any, as shall be required by GAAP shall
have been made for any such contested amounts, and (2) in the case of a
Lien with respect to any portion of the Collateral, such contest proceedings
conclusively operate to stay the sale of any portion of the Collateral on
account of such Lien or (c) with respect to Liens of mechanics, repairmen,
workmen and materialmen, with respect to which the Borrowers have obtained a
title insurance endorsement insuring against losses arising therewith or if
such Lien arises in the ordinary course of business or in the construction of
the Phase II Project, the Borrowers have bonded such Lien within a reasonable
time after becoming aware of the existence thereof;

 

(vi)     Liens incurred or deposits made in the
ordinary course of business in connection with workers’ compensation,
unemployment insurance and other types of social security, or to secure the
performance of tenders, statutory obligations, surety and appeal bonds, bids,
leases, government contracts, trade contracts, performance and return-of-money
bonds and other similar obligations (exclusive of obligations for the payment
of borrowed money), incurred in the ordinary course of business or in connection
with the construction of the Phase II Project (a) for amounts not yet
overdue, (b) for amounts that are overdue and that (in the case of any
such amounts overdue for a period in excess of five days) are being
contested in good faith by appropriate proceedings, so long as (1) such
reserves or other appropriate provisions, if any, as shall be required by GAAP
shall have been made for any such contested amounts, (2) in the case of a Lien
with respect to any portion of the Collateral, such contest proceedings
conclusively operate to stay the sale of any portion of the Collateral on
account of such Lien or (c) with respect to Liens of mechanics, repairmen,
workmen and materialmen, with respect to which the Borrowers have obtained a
title insurance endorsement insuring against losses arising therewith or if

 

22

 

such Lien arises
in the ordinary course of business or in the construction of the Phase II
Project, the Borrowers have bonded such Lien within the time required by the
Phase II Mall Sale Agreement or otherwise within a reasonable time after
becoming aware of the existence thereof;

 

(vii)    any attachment or judgment Lien not
constituting an Event of Default under subsection 7.8;

 

(viii)   leases or subleases granted to third parties
in accordance with any applicable terms of this Agreement, the Collateral
Documents and/or the Phase II Mall Sale Agreement;

 

(ix)     (a) easements, rights-of-way, avigational
servitudes, restrictions, encroachments, and other minor defects or
irregularities in title and other similar charges or encumbrances, in each case
which are permitted by the Phase II Mall Sale Agreement and which do not and
will not interfere in any material respect with the ordinary conduct of the
business of a Borrower or any of its Subsidiaries or result in a material
diminution in the value of any Collateral as security for the Obligations and
(b) any Liens or other exceptions to title that appear in the Mortgage Policy,
as the same may be updated from time to time in accordance with subsection
3.2C;

 

(x)      leases permitted under subsection
6.6(iv) and any leasehold mortgage in favor of any party financing the
lessee under any such lease, provided that neither of the Borrowers nor
their Subsidiaries is liable for the payment of, or interest, premiums or fees
on, such financing;

 

(xi)     Liens arising from filing UCC financing
statements relating solely to leases permitted by this Agreement;

 

(xii)    Liens in favor of customs and revenue
authorities arising as a matter of law to secure payment of customs duties in
connection with the importation of goods;

 

(xiii)   any zoning or similar law or right reserved
to or vested in any governmental office or agency to control or regulate the
use of any real property;

 

(xiv)   licenses of patents, trademarks and other
intellectual property rights granted by a Borrower or any of its Subsidiaries
in the ordinary course of business and not interfering in any material respect
with the ordinary conduct of the business of such Borrower or such Subsidiary;

 

(xv)    Liens created under the HVAC Services
Agreements;

 

(xvi)   Liens created under the Predevelopment
Agreement and the Improvement Phasing Agreement (as in effect on the Closing
Date);

 

(xvii)  Liens incurred in connection with the Rate Protection
Agreement required by subsection 5.12; provided that such Liens
only extend to the Collateral securing such Indebtedness with the same priority
thereto;

 

23

 

(xviii)      Liens
created or contemplated by the Cooperation Agreement; and

 

(xix)    Liens securing Indebtedness permitted
pursuant to subsection 6.1  (i),(iv) and (ix);

 

provided that other than with respect to Liens of the type set
forth under clauses (i), (ii), (xvii) and (xix),
such Liens do not secure Indebtedness for borrowed money.

 

“Person”
means natural persons, corporations, limited partnerships, general
partnerships, limited liability companies, limited liability partnerships,
joint stock companies, Joint Ventures, associations, companies, trusts, banks,
trust companies, land trusts, business trusts or other organizations, whether
or not legal entities, and governments (whether federal, state or local,
domestic or foreign, and including political subdivisions thereof) and agencies
or other administrative or regulatory bodies thereof.

 

“Phase II
Hotel/Casino” means an approximately 3,000 suite hotel, a gaming
facility of approximately 100,000 square feet, a multi-story parking structure
and meeting complex on a portion of the Site to be integrated with the Phase II
Mall and the Existing Facility.

 

“Phase II Hotel/Casino Equity
Account” has the
meaning given in the Disbursement Agreement.

 

“Phase II
Hotel/Casino Retail Stores” means certain retail space in the Phase
II Hotel/Casino that are to be leased by LCR to Phase II Mall Subsidiary
pursuant to the Master Lease.

 

“Phase II Mall”
means the Phase II Mall Space (a portion of which shall be initially leased by
Phase II Mall Subsidiary from LCR pursuant to the Phase II Mall Lease and
eventually transferred from LCR to Phase II Mall Subsidiary upon its
designation as one or more separate legal parcels in accordance with the
Disbursement Agreement to become the Phase II Mall Air Parcel, a portion of
which shall be leased by Phase II Mall Subsidiary pursuant to the Walgreens
Lease and a portion of which shall be leased by Phase II Mall Subsidiary
pursuant to the Master Lease) and the Phase II Mall Improvements located
therein, in each case to be integrated with the Phase II Hotel/Casino and the
Existing Facility.

 

“Phase II Mall Air Parcel” means the one or
more separate legal parcels owned or to be owned in fee simple by Phase II Mall
Subsidiary after the Phase II Mall Air Space is subdivided in accordance with
Section 5.11 of the Disbursement Agreement and within which a portion of the
Phase II Mall Improvements is to be constructed.

 

“Phase II Mall Air
Space” is described in Exhibit L.

 

“Phase II Mall
Appraisal” means an appraisal of the Phase II Mall conducted by
Jones Lang LaSalle and prepared in accordance with the standards of the
Appraisal Institute.

 

“Phase II Mall Borrower Taxes” is defined in
subsection 5.3C.

 

24

 

“Phase II Mall
Construction Loan” means the Loans in the aggregate amount of
$250,000,000 to be made by the Lenders to the Borrower in accordance with and
subject to the terms of this Agreement and the other Loan Documents.

 

“Phase II Mall
Contribution” means the intercompany loan from Venetian to Phase II
Mall Subsidiary evidenced and secured by the Phase II Mall Contribution
Documents in the initial amount of $25,371,098 and as such amount may be
increased pursuant to subsection 6.1 (iv).

 

“Phase II Mall
Contribution Documents” means the Intercompany Mall Note, together
with all related agreements, instruments and documents executed or delivered
pursuant thereto at any time (including all mortgages, guarantees, security
agreements and all other collateral and security documents), in each case as
such agreements, instruments and documents may be amended, supplemented,
amended and restated, or otherwise modified in accordance with the terms
hereof.

 

“Phase II Mall Equity Account” has the
meaning given in the Disbursement Agreement.

 

“Phase II Mall
Improvements” means “Mall Improvements” as such term is defined in
the Phase II Mall Sale Agreement.

 

“Phase II Mall Lease”
means that certain Indenture of Lease, dated as of the date hereof, by and
between LCR and the Phase II Mall Subsidiary covering the Phase II Mall Air
Space, as the same may be amended, supplemented, amended and restated, or
otherwise modified in accordance with the terms hereof and thereof.

 

“Phase II Mall Loan
Proceeds Account” has the meaning given in the Disbursement
Agreement.

 

“Phase II Mall
Project Costs” means the Project Costs related to the financing,
design, development and construction of the Phase II Mall (but not to any
corresponding costs related to the Phase II Hotel/Casino) incurred prior to the
Phase II Mall Release Date.

 

“Phase II Mall Recognition Agreement” has
the meaning given in subsection 5.13.

 

“Phase II Mall Release Conditions” has the
meaning given in the Disbursement Agreement.

 

“Phase II Mall Release Date” means the date
on which each of the Phase II Mall Release Conditions have been satisfied.

 

“Phase II Mall SA Assignment
Agreement” means
that certain Assignment and Assumption Agreement and First Amendment to
Agreement, dated as of September 30, 2004, among LCR, as the assignor, Phase II
Mall Subsidiary Holding, as the assignee, and GGP.

 

25

 

“Phase II Mall Sale” means the sale by Phase
II Mall Subsidiary Holding to GGP of the equity interests of Phase II Mall
Subsidiary pursuant to the terms of the Phase II Mall Sale Agreement.

 

“Phase II Mall Sale Reimbursement Agreement”
has the meaning given in the Disbursement Agreement.

 

“Phase II Mall Sale
Agreement” means the Agreement, dated as of April 12, 2004 between
LCR and GGP, as amended by the Phase II Mall SA Assignment Agreement, and as
the same may be further amended, supplemented, amended and restated, or
otherwise modified in accordance with the terms hereof and thereof.

 

“Phase II Mall Sale Reserve Account” means
the reserve account to be established by Phase II Mall Subsidiary Holding
pursuant to the terms of the Phase II Mall Sale Reimbursement Agreement and
pledged to LCR thereunder.

 

“Phase II Mall Space” means, collectively,
the retail space in which the Phase II Hotel/Casino Retail Stores will be
situated (which shall be leased by Phase II Mall Subsidiary pursuant to the
Master Lease), the Phase II Mall Air Space (which shall be initially leased by
Phase II Mall Subsidiary from LCR pursuant to the Phase II Mall Lease and
eventually transferred from LCR to Phase II Mall Subsidiary upon its designation
as one or more separate legal parcels in accordance with the Disbursement
Agreement to become the Phase II Mall Air Parcel), the Phase II Mall Air Parcel
and the Walgreens Air Space.

 

“Phase II Mall Space Easements”
means any easements appurtenant, easements in gross, license agreements or
other rights running for the benefit of Phase II Mall Subsidiary with respect
to the Phase II Mall Space and/or appurtenant to the Phase II Mall Space,
including, without limitation, those certain easements and licenses described
in each Title Policy related to the Phase II Mall Space.

 

“Phase II Mall
Subsidiary” has the meaning given in the preamble.

 

“Phase II Mall
Subsidiary Holding” has the meaning given in the preamble.

 

“Phase II Mall Title Defect” means “Title Defect”
as defined in the Phase II Mall Sale Agreement.

 

“Phase II Project”
means an approximately 3,000 room hotel, casino, retail and meeting complex to
be integrated with the Existing Facility and located on the Site and which will
include the Phase II Mall.

 

“Plans and
Specifications” has the meaning given in the Disbursement Agreement.

 

“Potential Event of
Default” means a condition or event that, after notice or lapse of
time or both, would constitute an Event of Default.

 

“Predevelopment
Agreement” means the Sands Resort Hotel Casino Agreement, dated as
of February 18, 1997, as amended, between Clark County, Nevada and LVSI.

 

26

 

“Prime Rate”
means the rate that the Administrative Agent announces from its New York office
from time to time as its Dollar prime lending rate, as in effect from time to
time.  The Prime Rate is a reference
rate and does not necessarily represent the lowest or best rate actually
charged to any customer.  The
Administrative Agent or any other Lender may make commercial loans or other
loans at rates of interest at, above or below the Prime Rate.

 

“Proceedings”
is defined in subsection 5.1(vii).

 

“Project Budget”
has the meaning given in the Disbursement Agreement.

 

“Project Costs”
has the meaning given in the Disbursement Agreement.

 

“Project Documents”
means the Phase II Mall Lease, the Phase II Mall Sale Agreement, the Phase II
Mall SA Assignment Agreement, the Construction Management Agreement, the COREA,
the Walgreens Lease, and any document or agreement related to the design,
development, construction or pre-opening of the Phase II Mall and entered into
on, prior to or after the Closing Date, in accordance with
subsection 6.1.2 of the Disbursement Agreement.

 

“Pro Rata Share”
means, with respect to all payments of the Loans of any Lender, the percentage
obtained by dividing (i) the Loan Exposure of that Lender by
(ii) the Loan Exposure of all Lenders.

 

“Quarterly Date”
means March 31, June 30, September 30 and December 31.

 

“Quarterly Payment
Date” means each April 1, July 1, October 1 and January 1.

 

“Rate Protection
Agreement” means, collectively, any Hedging Agreement entered into
by the Borrowers or any of their Subsidiaries pursuant to subsection 5.12
under which the counterparty of such Hedging Agreement is (or at the time such
Hedging Agreement was entered into, was) a Lender or an Affiliate of a Lender.

 

“Rating Agencies”
is defined in the definition of “Cash Equivalents”.

 

“Refinancing” has the meaning given in the
Bank Facilities Agreement.

 

“Refinancing Fees” with respect to any
refinancing of Indebtedness permitted under subsection 6.1(ii), any
reasonable fees, expenses, premiums, make whole payments, and accrued and
unpaid interest refinanced or paid or incurred in connection therewith.

 

“Register”
is defined in subsection 2.1D(i).

 

“Regulation D”
means Regulation D of the Board of Governors of the Federal Reserve System, as
in effect from time to time.

 

“Related Parties”
means:  (a) Family Members (defined
below); (b) directors of LVSI or Venetian and employees of LVSI or
Venetian who are senior managers or officers of LVSI, Venetian, Interface or
any of their Affiliates; (c) any Person who receives an interest in LVSI
or Venetian from any individual referenced in clauses (a)-(b)
in a gratuitous transfer, whether by

 

27

 

gift, bequest or
otherwise, to the extent of such interest; (d) the estate of any
individual referenced in clauses (a)-(c); (e) a trust
for the benefit of one or more of the individuals referenced in clauses (a)-(c);
and/or (f) an entity owned or controlled, directly or indirectly, by one
or more of the individuals, estates or trusts referenced in clauses (a)-(e).  For the purpose of this paragraph, a “Family
Member” shall include:  (a) Sheldon
G. Adelson; (b) Dr. Miriam Adelson; (c) any sibling of either of
the foregoing; (d) any issue of any one or more of the individuals
referenced in the preceding clauses (a)-(c); and (e) the
spouse or issue of the spouse of one or more of the individuals referenced in
the preceding clauses (a)-(d).

 

“Release”
means any release, spill, emission, leaking, pumping, pouring, injection,
escaping, deposit, disposal, discharge, dispersal, dumping, leaching or
migration of Hazardous Materials into the indoor or outdoor environment
(including the abandonment or disposal of any barrels, containers or other
closed receptacles containing any Hazardous Materials), including the movement
of any Hazardous Materials through the air, soil, surface water or groundwater.

 

“Requisite Lenders”
means Lenders having or holding more than 50% of the sum of the aggregate
outstanding principal amount of all Loans and unused amount of the Commitments
of all Lenders.

 

“Resort Complex” means the Existing Facility and the
Phase II Project.

 

“Resort Complex
Operative Documents” means the Cooperation Agreement, the Harrah’s
Shared Roadway Agreement, the HVAC Services Agreements, the Predevelopment
Agreement, the Improvement Phasing Agreement, the Site Easements, the Master
Lease and the Walgreens Lease.

 

“Restricted Payment”
means (a) any dividend or other distribution, direct or indirect, on
account of any shares of any class of equity Securities of either Borrower now
or hereafter outstanding, except a dividend or distribution payable solely in
shares of that class of equity Securities to the holders of that class (or the
accretion of such dividends or distribution), (b) any redemption,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of any class of equity Securities of
any Borrower now or hereafter outstanding, (c) any payment made to retire,
or to obtain the surrender of, any outstanding warrants, options or other
rights to acquire shares of any class of equity Securities of any Borrower now
or hereafter outstanding, and (d) any payment or prepayment of principal
of, premium, if any, or interest on, or redemption, purchase, retirement,
defeasance (including in-substance or legal defeasance), sinking fund or
similar payment with respect to the Phase II Mall Contribution.

 

“Restricted Subsidiary” has the meaning
given in the Bank Facilities Agreement.

 

“Scotia Capital”
is defined in the preamble.

 

“SECC” means the exposition and meeting
facilities commonly known as the Sands Expo and Convention Center.

 

28

 

“Secured Parties”
means, collectively, the Lenders, the Administrative Agent, each counterparty
to a Rate Protection Agreement that is (or at the time such Rate Protection
Agreement was entered into, was) a Lender or an Affiliate thereof.

 

“Securities”
means any stock, shares, partnership interests, voting trust certificates,
certificates of interest or participation in any profit-sharing agreement or
arrangement, options, warrants, bonds, debentures, notes, or other evidences of
indebtedness, secured or unsecured, convertible, subordinated or otherwise, or
in general any instruments commonly known as “securities” or any certificates
of interest, shares or participations in temporary or interim certificates for
the purchase or acquisition of, or any right to subscribe to, purchase or
acquire, any of the foregoing.

 

“Securities Act”
means the Securities Act of 1933, as amended from time to time, and any
successor statute.

 

“Security Agreement”
means the Security Agreement executed and delivered by each Borrower,
substantially in the form of Exhibit D-2 annexed hereto.

 

“Site” means the real property consisting of approximately 14 acres adjoining
the Existing Site and owned by LCR.

 

“Site Easement” means any easement appurtenant, easement in gross,
license agreement and other right running for the benefit of the Borrowers, the
Existing Facility, the Phase II Project or appurtenant to the Site and/or the
Existing Site which benefits or burdens the Resort Complex, including those
certain easements and licenses described in the Title Insurance Policies.

 

“Solvent”
means, with respect to any Person, that as of the date of determination both
(a) (i) the then fair saleable value of the property of such Person
is (A) greater than the total amount of liabilities (including contingent
liabilities) of such Person and (B) not less than the amount that will be
required to pay the probable liabilities on such Person’s then existing debts
as they become absolute and matured considering all financing alternatives and
potential asset sales reasonably available to such Person; (ii) such
Person’s capital is not unreasonably small in relation to its business or any
contemplated or undertaken transaction; and (iii) such Person does not intend
to incur, or believe (nor should it reasonably believe) that it will incur,
debts beyond its ability to pay such debts as they become due; and (b) such
Person is “solvent” within the meaning given that term and similar terms under
applicable laws relating to fraudulent transfers and conveyances.  For purposes of this definition, the amount
of any contingent liability at any time shall be computed as the amount that,
in light of all of the facts and circumstances existing at such time,
represents the amount that can reasonably be expected to become an actual or
matured liability.

 

“Stop Funding Notice” has the meaning given in the
Disbursement Agreement.

 

“Subsidiary”
means, with respect to any Person, (a) any corporation, partnership, limited
liability company, association, joint venture or other business entity of which
more than 50% of the total voting power of shares of stock or other ownership
interests entitled (without regard to the occurrence of any contingency) to
vote in the election of the Person or Persons (whether

 

29

 

directors,
managers, trustees or other Persons performing similar functions) having the
power to direct or cause the direction of the management and policies thereof
is at the time owned or controlled, directly or indirectly, by that Person or
one or more of the other Subsidiaries of that Person or a combination thereof
and (b) any partnership or limited liability company of which more than
50% of such entities’ capital accounts, distribution rights, general or limited
partnership interests or membership interests are owned or controlled directly
or indirectly by such Person or one of more other Subsidiaries of that Person
or a combination thereof.

 

“Subsidiary Guarantor” has the meaning given
in the Bank Facilities Agreement.

 

“Substantial
Completion” has the meaning given in the Disbursement Agreement.

 

“Substantial
Completion Date” means the date on which Substantial Completion
occurs.

 

“Substitute Lender”
is defined in subsection 9.7(A).

 

“Supplemental Agent”
is defined in subsection 8.1B.

 

“Supplier Joint
Venture” means any Person that supplies or provides materials or
services to any Borrower or any contractor in the Resort Complex and in which a
Borrower or one of its Subsidiaries have Investments.

 

“Tax” or
“Taxes” means any present or
future tax, levy, impost, duty, charge, fee, deduction or withholding of any
nature and whatever called, by whomsoever, on whomsoever and wherever imposed,
levied, collected, withheld or assessed; provided that “Tax on the overall net income” of a Person
shall be construed as a reference to a tax imposed by the jurisdiction in which
that Person is organized or in which that Person’s principal office (and/or, in
the case of a Lender, its lending office) is located or in which that Person
(and/or, in the case of a Lender, its lending office) is deemed to be doing
business on all or part of the net income, profits or gains (whether worldwide,
or only insofar as such income, profits or gains are considered to arise in or
to relate to a particular jurisdiction, or otherwise) of that Person (and/or,
in the case of a Lender, its lending office).

 

“Termination Date”
means the date on which all payment Obligations then due and payable have been
repaid in full in cash and all Commitments shall have terminated.

 

“Title Company”
means First American Title Insurance Company or an Affiliate thereof and/or one
or more other title insurance companies reasonably satisfactory to the
Administrative Agent.

 

“Title Insurance
Policies” means the Secured Parties’ A.L.T.A. policy of title
insurance issued by the Title Company as of the Closing Date, including all
amendments thereto, endorsements thereof and substitutions or replacements
therefor.

 

“Transactions”
is defined in subsection 3.1K(ii).

 

30

 

“Transaction Costs”
means the fees, costs and expenses payable by the Borrowers on or before the
Closing Date in connection with this Agreement, the other Loan Documents and
the initial Credit Extension hereunder.

 

“type” means, relative to any Loan, the
portion thereof, if any, being maintained as a Base Rate Loan or a Eurodollar
Rate Loan.

 

“UCC”
means the Uniform Commercial Code as in effect from time to time in the State
of New York; provided, that if, with respect to any UCC financing
statement or by reason of any provisions of law, the perfection or the effect
of perfection or non-perfection of the security interests granted to the
Administrative Agent pursuant to the applicable Loan Document is governed by
the Uniform Commercial Code as in effect in a jurisdiction of the United States
other than New York, then “UCC” means the Uniform Commercial Code as in effect from
time to time in such other jurisdiction for purposes of the provisions of each
Loan Document and any UCC financing statement relating to such perfection or
effect of perfection or non-perfection.

 

“United States”
or “U.S.” means the United States,
its fifty states and the District of Columbia.

 

“Venetian”
means Venetian Casino Resort, LLC and its successors.

 

“Walgreens Lease”
means that certain Commercial Lease dated as of February 2004  between LCR and Cap II—Buccaneer, LLC, a New
Mexico limited liability company, as assigned in accordance with the terms of
this Agreement by LCR to the Phase II Mall Subsidiary.

 

“Walgreens Air Space” means the real
property situated in the County of Clark, State of Nevada described in the
Walgreens Lease and more specifically described in Exhibit B to the Deed of
Trust.

 

“Withdrawal Period”
is defined in subsection 9.7(B).

 

1.2           Accounting
Terms; Utilization of GAAP for Purposes of Calculations Under
Agreement.

 

Except as otherwise expressly provided in this
Agreement (including the last sentence of this subsection 1.2), all
accounting terms not otherwise defined herein shall have the meanings assigned
to them in conformity with GAAP. 
Financial statements and other information required to be delivered by
the Borrowers to Lenders pursuant to clauses (i), (ii) and (iii)
of subsection 5.1 shall be prepared in accordance with GAAP as in effect
at the time of such preparation. 
Calculations in connection with the definitions, covenants and other
provisions of this Agreement shall utilize accounting principles and policies
in conformity with those used to prepare the financial statements referred to
in subsection 4.3.

 

1.3           Other
Definitional Provisions and Rules of Construction.

 

(A)          Any of the terms defined herein may,
unless the context otherwise requires, be used in the singular or the plural,
depending on the reference.

 

31

 

(B)           References to “Sections” and
“subsections” shall be to Sections and subsections, respectively, of this
Agreement unless otherwise specifically provided.

 

(C)           The use in any of the Loan Documents
of the word “include” or “including”, when following any general statement,
term or matter, shall not be construed to limit such statement, term or matter
to the specific items or matters set forth immediately following such word or
to similar items or matters, whether or not nonlimiting language (such as
“without limitation” or “but not limited to” or words of similar import) is
used with reference thereto, but rather shall be deemed to refer to all other
items or matters that fall within the broadest possible scope of such general
statement, term or matter.

 

(D)          Any reference to any agreement or
instrument shall be deemed to include a reference to such agreement or
instrument as assigned, amended, supplemented or otherwise modified from time
to time, but only to the extent in accordance with subsection 6.12
(to the extent applicable).

 

2.             Amounts and
Terms of Commitments and Loans.

 

2.1           Commitments;
Making of Loans; the Register; Notes.

 

(A)          Commitments.  Subject to the terms and conditions of this
Agreement, from time to time on any Business Day occurring from and after the
Closing Date but on or prior to the Commitment Termination Date, each Lender
that has a Commitment, agrees that it will severally make loans (relative to
such Lender, its “Loans”) to the
Borrowers equal to such Lender’s Percentage of the aggregate amount of each
borrowing of the Loans requested by the Borrowers to be made on such day.  No amounts paid or prepaid with respect to
Loans may be reborrowed.  No Lender
shall be permitted or required to make any Loan if, after giving effect
thereto, the aggregate outstanding principal amount of all Loans of such Lender
would exceed such Lender’s Percentage of the then existing Commitment
Amount.  Each Lender’s Commitment shall
expire on the Commitment Termination Date.

 

(B)           Borrowing  Mechanics.  Loans made
on any Funding Date shall be in an aggregate minimum amount of $1,000,000 and
integral multiples of $500,000 in excess of that amount.

 

(i)       Whenever the Borrowers desire that
Lenders make Loans, the Borrowers shall deliver to the Disbursement Agent the
Advance Request and related documentation required by the terms of Section
2.4.1(a) of the Disbursement Agreement. 
In addition, the Borrowers shall deliver to the Administrative Agent a
Borrowing Notice no later than 1:00 p.m. (New York City time) at least three
Business Days in advance of the proposed Funding Date (in the case of a
Eurodollar Rate Loan) or at least one Business Day in advance of the proposed
Funding Date (in the case of a Base Rate Loan).  The Borrowing Notice shall specify (i) the proposed Funding
Date (which shall be a Business Day), (ii) the amount and type of Loans
requested, (iii) whether such Loans shall be Base Rate Loans or Eurodollar
Rate Loans, and (iv) in the case of any Loans requested to be made as
Eurodollar Rate Loans, the initial Interest Period requested therefor.  The Borrowers shall notify the
Administrative Agent prior to the funding of any such Loans in the event that
any of the matters to

 

32

 

which the
Borrowers are required to certify in the applicable Borrowing Notice and/or the
applicable Advance Request is no longer true and correct as of the applicable
Funding Date, and the acceptance by the Borrowers of the proceeds of any Loans
shall constitute a recertification by the Borrowers, as of the applicable
Funding Date, as to the matters to which the Borrowers is required to certify
in the applicable Borrowing Notice and the applicable Funding Date.

 

(ii)      Except as otherwise provided in subsections
2.6B, 2.6C and 2.6G, a Borrowing Notice for a Eurodollar Rate
Loan shall be irrevocable on and after the related Interest Rate Determination
Date, and the Borrowers shall be bound to make a Borrowing in accordance
therewith.

 

(iii)     All proceeds of Loans shall be deposited in
the Phase II Mall Loan Proceeds Account and/or the Disbursement Account in
accordance with the Disbursement Agreement.

 

(C)           Lending of Funds.  All Loans under this Agreement shall be made
by the Lenders simultaneously and proportionately to their respective
Percentage, it being understood that no Lender shall be responsible for any
default by any other Lender in that other Lender’s obligation to make a Loan
requested hereunder nor shall the Commitment of any Lender be increased or
decreased as a result of a default by any other Lender in that other Lender’s
obligation to make a Loan requested hereunder. 
Promptly after receipt by the Administrative Agent of an Advance
Request, the Construction Consultant’s certificate from the Disbursement Agent
and a Borrowing Notice pursuant to subsection 2.1B, the Administrative
Agent shall notify each Lender of the proposed Borrowing.  Each Lender shall (unless the Administrative
Agent shall have subsequently received a Stop Funding Notice) make the amount
of its Loan available to the Administrative Agent not later than 12:00 Noon (New
York City time) on the applicable Funding Date, in same day funds in Dollars,
at the Funding and Payment Office, and, after receipt thereof as aforesaid the
Administrative Agent shall deposit such funds in the Phase II Mall Loan
Proceeds Account and/or the Disbursement Account in accordance with the
Disbursement Agreement no later than 1:00 p.m. (New York City time) on the
applicable Funding Date (and in so doing such Loans shall be deemed made
available to the Borrowers hereunder) and the Disbursement Agent shall then
make the proceeds of such Loans available to the Borrowers in accordance with
and upon fulfillment of the conditions set forth in the Disbursement Agreement.

 

(i)       The Administrative Agent shall notify
each relevant Lender promptly upon receipt of any Stop Funding Notice, but
shall bear no liability if, despite the receipt of such Stop Funding Notice,
any Lender makes available any money to the Administrative Agent in respect of
the requested Loans.  In such event, the
Administrative Agent shall refund the amount received by it as promptly as
possible and in any event by the following Business Day.

 

(ii)      Unless the Administrative Agent shall have
been notified by any Lender prior to the Funding Date for any Loans that such
Lender does not intend to make available to the Administrative Agent the amount
of such Lender’s Loan requested on such Funding Date, the Administrative Agent
may assume that such Lender has made such amount available to the
Administrative Agent on such Funding Date and the

 

33

 

Administrative
Agent may, in its sole discretion, but shall not be obligated to, make
available to the Borrowers a corresponding amount on such Funding Date.  If such corresponding amount is not in fact
made available to the Administrative Agent by such Lender, the Administrative
Agent shall be entitled to recover such corresponding amount on demand from
such Lender together with interest thereon, for each day from such Funding Date
until the date such amount is paid to the Administrative Agent, at the
customary rate set by the Administrative Agent for the correction of errors
among banks for three Business Days and thereafter at the Base Rate.  If such Lender does not pay such
corresponding amount forthwith upon Administrative Agent’s demand therefor, the
Administrative Agent shall promptly notify the Borrowers and the Borrowers
shall immediately pay such corresponding amount to the Administrative Agent
together with interest thereon, for each day from such Funding Date until the
date such amount is paid to the Administrative Agent, at the rate payable under
this Agreement for Base Rate Loans. 
Nothing in this subsection 2.1C shall be deemed to relieve any
Lender from its obligation to fulfill its Commitments hereunder or to prejudice
any rights that the Borrowers may have against any Lender as a result of any
default by such Lender hereunder.

 

(D)          The Register.

 

(i)       The Administrative Agent (or its agent or
sub-agent appointed by it) shall maintain, as agent for the Borrower, at its
address referred to in subsection 9.9, a register for the recordation of
the names and addresses of Lenders and the Commitments and Loans of each Lender
from time to time (the “Register”).  The Register, as in effect at the close of
business on the preceding Business Day, shall be available for inspection by
the Borrowers or any Lender at any reasonable time and from time to time upon
reasonable prior notice.

 

(ii)      The Administrative Agent shall record, or
shall cause to be recorded, in the Register the Commitment and the Loans (in
accordance with the provisions of subsection 9.1) from time to time of
each Lender, and each repayment or prepayment in respect of the principal
amount of the Loans of each Lender.  Any
such recordation shall be conclusive and binding on Borrowers and each Lender,
absent manifest error; provided that failure to make any such
recordation, or any error in such recordation, shall not affect any Lender’s
Commitments or the Obligations of either of the Borrowers in respect of any
applicable Loans.

 

(iii)     Each Lender shall record on its internal
records (including the Notes held by such Lender) the amount of each Loan made
by it and each payment in respect thereof. 
Any such recordation shall be conclusive and binding on Borrowers,
absent manifest error; provided that failure to make any such
recordation, or any error in such recordation, shall not affect any Lender’s
Commitments or the Obligations of either of the Borrowers in respect of any
applicable Loans; and provided, further that in the event of any
inconsistency between the Register and any Lender’s records, the recordations
in the Register shall govern.

 

34

 

(iv)     The Administrative Agent and Lenders shall
deem and treat the Persons listed as Lenders in the Register as the holders and
owners of the corresponding Commitments and Loans listed therein for all
purposes hereof, and no assignment or transfer of any such Commitment or Loan
shall be effective, in each case unless and until an Assignment Agreement
effecting the assignment or transfer thereof shall have been accepted by the
Administrative Agent and recorded in the Register as provided in subsection
9.1B(ii).  Prior to such
recordation, all amounts owed with respect to the applicable Commitment or Loan
shall be owed to the Lender listed in the Register as the owner thereof, and
any request, authority or consent of any Person who, at the time of making such
request or giving such authority or consent, is listed in the Register as a
Lender shall be conclusive and binding on any subsequent holder, assignee or
transferee of the corresponding Commitments or Loans.

 

(E)           Notes.  The Borrowers agree that, upon request to
the Administrative Agent by any Lender, the Borrowers will execute and deliver
to such Lender a Note evidencing the Loans made by, and payable to the order
of, such Lender in a maximum principal amount equal to such Lender’s Percentage
of the Phase II Mall Construction Loan. 
Each Borrower hereby irrevocably authorizes each Lender to make (or
cause to be made) appropriate notations on the grid attached to such Lender’s
Note (or on any continuation of such grid), which notations, if made, shall
evidence, inter  alia, the date of, the outstanding principal
amount of, and the interest rate and Interest Period applicable to the Loans
evidenced thereby.  Such notations
shall, to the extent not inconsistent with notations made by the Administrative
Agent in the Register, be conclusive and binding on each Obligor absent
manifest error; provided, however, that the failure of any Lender
to make any such notations shall not limit or otherwise affect any Obligations
of any Borrower.

 

2.2           Interest
on the Loans.

 

(A)          Rate of Interest.  Subject to the provisions of subsections
2.6 and 2.7, each Loan shall bear interest on the unpaid principal
amount thereof from the date made through maturity (whether by acceleration or
otherwise) at a rate determined by reference to the Base Rate or the Adjusted
Eurodollar Rate.  The applicable basis
for determining the rate of interest with respect to any Loan shall be selected
by the Borrowers initially at the time a Borrowing Notice is given with respect
to such Loan pursuant to subsection 2.1B, and the basis for determining
the interest rate with respect to any Loan may be changed from time to time
pursuant to subsection 2.2D.  If
on any day a Loan is outstanding with respect to which notice has not been
delivered to the Administrative Agent in accordance with the terms of this
Agreement specifying the applicable basis for determining the rate of interest,
then for that day that Loan shall bear interest determined by reference to the
Base Rate.  Subject to the provisions of
subsections 2.2E and 2.7, the Loans shall bear interest at a
rate per annum as follows:

 

(i)       if a Base Rate Loan, then from the date
of funding of such Loan at the sum of the Base Rate plus the Applicable
Margin for such Loans; or

 

(ii)      if a Eurodollar Rate Loan, then from the
date of funding of such Loan at the sum of the Adjusted Eurodollar Rate plus
the Applicable Margin for such Loans.

 

35

 

All Eurodollar Rate Loans
shall bear interest from and including the first day of the applicable Interest
Period to (but not including) the last day of such Interest Period at the
interest rate determined as applicable to such Eurodollar Rate Loan.

 

(B)           Interest Periods.  In connection with each Eurodollar Rate
Loan, the Borrowers may, pursuant to the applicable Borrowing Notice or
Conversion/Continuation Notice, as the case may be, select an interest period
(each an “Interest Period”) to be
applicable to such Loan, which Interest Period shall be, at Borrowers’ option,
either a one, two, three or six month period; provided that:

 

(i)       the initial Interest Period for any Eurodollar
Rate Loan shall commence on the Funding Date in respect of such Loan, in the
case of a Loan initially made as a Eurodollar Rate Loan, or on the date
specified in the applicable Conversion/Continuation Notice, in the case of a
Loan converted to a Eurodollar Rate Loan;

 

(ii)      in the case of immediately successive
Interest Periods applicable to a Eurodollar Rate Loan continued as such
pursuant to a Conversion/Continuation Notice, each successive Interest Period
shall commence on the day on which the next preceding Interest Period expires;

 

(iii)     if an Interest Period would otherwise
expire on a day that is not a Business Day, such Interest Period shall expire
on the next succeeding Business Day; provided that, if any Interest Period
would otherwise expire on a day that is not a Business Day but is a day of the
month after which no further Business Day occurs in such month, such Interest
Period shall expire on the next preceding Business Day;

 

(iv)     any Interest Period that begins on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the calendar month at the end of such Interest Period)
shall, subject to subsection 2.2B(v), end on the last Business Day of a
calendar month;

 

(v)      no Interest Period with respect to any
portion of the Loans shall extend beyond the Maturity Date for such Loans;

 

(vi)     no Interest Period shall extend beyond a
date on which Borrowers are required to make a scheduled payment of principal
of the Loans unless the sum of (a) the aggregate principal amount of Loans that
are Base Rate Loans plus (b) the aggregate principal amount of Loans
that are Eurodollar Rate Loans with Interest Periods expiring on or before such
date plus (c) the excess of the Commitments then in effect over the
aggregate principal amount of the Loans then outstanding equals or exceeds the
principal amount required to be paid on the Loans or the permanent reduction of
the Commitments that is scheduled to occur, on such date;

 

(vii)    there shall be no more than nine Interest
Periods outstanding at any time;

 

36

 

(viii)   in the event the Borrowers fail to specify an
Interest Period for any Eurodollar Rate Loan in the applicable Borrowing Notice
or Conversion/Continuation Notice, the Borrowers shall be deemed to have
selected an Interest Period of one month; and

 

(ix)     the Borrowers may not select an Interest
Period of greater than one month until sixty days after the Closing Date
(unless prior thereto the Administrative Agent provides written notice that the
syndication has been completed).

 

(C)           Interest Payments.  Subject to the provisions of subsection 2.2E,
interest on each Loan shall be payable in arrears (i) on each Interest Payment
Date with respect to such Loan, (ii) upon any prepayment of that Loan, whether
voluntary or mandatory, to the extent accrued on the amount being prepaid and
(iii) at maturity of the Loans, including final maturity of the Loans; provided,
however, with respect to any voluntary prepayment of a Base Rate Loan,
accrued interest shall instead be payable on the applicable Interest Payment
Date.  The Borrowers shall include in
each Advance Request delivered pursuant to Section 2.4.1(a) of the Disbursement
Agreement a request that a portion of the Advance covered by such Advance
Request shall be made to pay Debt Service which is then due and payable (or
will be due and payable prior to 30 days after the Advance Date set forth in
such Advance Request).  If the Borrowers
fail to set forth such information in any Advance Request or fail to deliver
timely any Advance Request therefor, then the Administrative Agent may deliver
such information and a request for payment to the Disbursement Agent, the
Construction Consultant and the Borrowers, upon which request the Borrowers
shall revise the Advance Request to provide for such payment.  The Borrowers acknowledge that failure of
any notice referenced in this subsection 2.2(C) or Section 2.8 of the
Disbursement Agreement to be delivered shall not in any way exonerate or
diminish the Borrowers’ obligation to make all payments under the Loan
Documents as and when due.

 

(D)          Conversion or Continuation.  Subject to the provisions of subsection 2.6,
the Borrowers shall have the option (i) to convert at any time all or any
part of its outstanding Loans equal to $1,000,000 and integral multiples of
$1,000,000 in excess of that amount from Loans bearing interest at a rate
determined by reference to one basis to Loans bearing interest at a rate
determined by reference to an alternative basis or (ii) upon the
expiration of any Interest Period applicable to a Eurodollar Rate Loan, to
continue all or any portion of such Loan equal to $1,000,000 and integral
multiples of $1,000,000 in excess of that amount as a Eurodollar Rate Loan; provided,
however, that a Eurodollar Rate Loan may only be converted into a Base
Rate Loan on the expiration date of an Interest Period applicable thereto.

 

Borrowers shall deliver a Conversion/Continuation
Notice to the Administrative Agent no later than 1:00 p.m. (New York City time)
at least one Business Day in advance of the proposed conversion date (in the
case of a conversion to a Base Rate Loan) and at least three Business Days in
advance of the proposed conversion/continuation date (in the case of a
conversion to, or a continuation of, a Eurodollar Rate Loan).  A Conversion/Continuation Notice shall
specify (i) the proposed conversion/continuation date (which shall be a
Business Day), (ii) the amount and type of the Loan to be converted/continued,
(iii) the nature of the proposed conversion/continuation, (iv) in the
case of a conversion to, or a continuation of, a Eurodollar Rate Loan, the
requested Interest Period, and (v) in the case of a conversion to, or a
continuation of, a Eurodollar Rate Loan, that no Potential Event of Default or
Event of Default has occurred

 

37

 

and is
continuing.  In lieu of delivering the
above-described Conversion/Continuation Notice, the Borrowers may give the
Administrative Agent telephonic notice by the required time of any proposed
conversion/continuation under this subsection 2.2D; provided that
such notice shall be promptly confirmed in writing by delivery of a
Conversion/Continuation Notice to the Administrative Agent on or before the
proposed conversion/continuation date. 
Upon receipt of written or telephonic notice of any proposed
conversion/continuation under this subsection 2.2D, the Administrative
Agent shall promptly transmit such notice by telefacsimile or telephone to each
Lender.

 

Neither the Administrative Agent nor any Lender shall
incur any liability to the Borrowers in acting upon any telephonic notice
referred to above that the Administrative Agent believes in good faith to have
been given by a duly Authorized Officer or other Person authorized to act on
behalf of the Borrowers or for otherwise acting in good faith under this subsection
2.2D, and upon conversion or continuation of the applicable basis for
determining the interest rate with respect to any Loans in accordance with this
Agreement pursuant to any such telephonic notice Borrowers shall have effected
a conversion or continuation, as the case may be, hereunder.

 

Except as otherwise provided in subsections 2.6B,
2.6C and 2.6G, a Conversion/Continuation Notice for conversion
to, or continuation of, a Eurodollar Rate Loan (or telephonic notice in lieu
thereof) shall be irrevocable on and after the related Interest Rate
Determination Date, and Borrowers shall be bound to effect a conversion or continuation
in accordance therewith.

 

(E)           Default Rate.  Upon the occurrence and during the
continuation of any Event of Default, the outstanding principal amount of all
overdue amounts and, to the extent permitted by applicable law, any interest
payments thereon not paid when due and any fees and other amounts then due and
payable hereunder, shall thereafter bear interest (including post-petition
interest in any proceeding under the Bankruptcy Code or other applicable
bankruptcy laws) payable upon demand at a rate that is 2% per annum in excess
of the interest rate otherwise payable under this Agreement for Base Rate
Loans.  Payment or acceptance of the
increased rates of interest provided for in this subsection 2.2E is
not a permitted alternative to timely payment and shall not constitute a waiver
of any Event of Default or otherwise prejudice or limit any rights or remedies
of the Administrative Agent or any Lender.

 

(F)           Computation of Interest and
Commitment Fees.  Interest on the
Loans and commitment fees shall be computed on the basis of (i) a 360-day
year, in the case of Eurodollar Rate Loans and (ii) a 365 or 366-day year,
in respect of Base Rate Loans and commitment fees, in each case for the actual
number of days elapsed in the period during which it accrues.  In computing interest on any Loan, (x) the
date of the making of such Loan or the first day of an Interest Period
applicable to such Loan or, the last Interest Payment Date with respect to such
Loan or, with respect to a Base Rate Loan being converted from a Eurodollar
Rate Loan, the date of conversion of such Eurodollar Rate Loan to such Base
Rate Loan, as the case may be, shall be included, and (y) the date of payment
of such Loan or the expiration date of an Interest Period applicable to such Loan
or, with respect to a Base Rate Loan being converted to a Eurodollar Rate Loan,
the date of conversion of such Base Rate Loan to such Eurodollar Rate Loan, as
the

 

38

 

case
may be, shall be excluded; provided that if a Loan is repaid on the same
day on which it is made, one day’s interest shall be paid on that Loan.

 

2.3           Fees.

 

(A)          Commitment Fees.  The Borrowers agree to pay to the
Administrative Agent, for distribution to each Lender in proportion to that
Lender’s Percentage, commitment fees for the period from and including the
Closing Date to and excluding the Commitment Termination Date equal to the
average of the daily aggregate Commitment Amounts multiplied by 0.375% per
annum, in each case such commitment fees to be calculated on the basis of a
360-day year and the actual number of days elapsed and to be payable quarterly
in arrears on each Quarterly Payment Date, commencing on the first such date to
occur after the Closing Date, and on the Commitment Termination Date, as
applicable.

 

(B)           Annual Administrative Fee.  The Borrowers agree to pay to the
Administrative Agent an annual administrative fee in the amount and at the
times set forth in the Arranger’s Fee Letter.

 

(C)           Other Fees.  The Borrowers agree to pay to the Agents
such other fees in the amounts and at the times as may be agreed by them in
writing.

 

2.4           Repayments,
Prepayments and Reductions in Commitments; General Provisions Regarding
Payments.  The Borrowers shall
repay, in full, the unpaid principal amount of the Loans upon the Maturity
Date.  Prior thereto, payments and
prepayments of the Loans shall or may be made as set forth below:

 

(A)          Prepayments and Unscheduled
Reductions in Commitments.

 

(i)       Voluntary Prepayments.  The Borrowers may, upon not less than one
Business Day’s prior written or telephonic notice, in the case of Base Rate
Loans, and three Business Days’ prior written or telephonic notice, in the case
of Eurodollar Rate Loans, in each case given to the Administrative Agent by
1:00 p.m. (New York City time) on the date required and, if given by telephone,
promptly confirmed in writing to the Administrative Agent (which original
written or telephonic notice Administrative Agent will promptly transmit by
telefacsimile or telephone to each Lender), at any time and from time to time
prepay any Loans on any Business Day in whole or in part in an aggregate
minimum amount of $1,000,000 and integral multiples of $500,000 in excess of
that amount; provided, however, that with respect to any
Eurodollar Rate Loan not prepaid on the expiration of the Interest Period
applicable thereto the Borrowers shall pay any amount payable pursuant to subsection
2.6D; provided, further, that no such voluntary partial
prepayments will be permitted prior to Substantial Completion unless the
Borrowers demonstrate in an Officers’ Certificate that the Phase II Project is
In Balance on a pro forma basis for such prepayment.  Notice of prepayment having been given as
aforesaid, the principal amount of the Loans specified in such notice shall
become due and payable on the prepayment date specified therein.  Any such voluntary prepayment shall be
applied as specified in subsection 2.4B(iv).

 

39

 

(ii)                  Voluntary
Reductions of Commitments.  After
Substantial Completion, the Borrowers may, upon not less than three Business
Days’ prior written or telephonic notice confirmed in writing to the
Administrative Agent (which original written or telephonic notice
Administrative Agent will promptly transmit by telefacsimile or telephone to
each Lender), at any time and from time to time terminate in whole or
permanently reduce in part, without premium or penalty, the Loan Commitments; provided
that any such partial reduction of such Commitments shall be in an aggregate
minimum amount of $1,000,000 and integral multiples of $500,000 in excess of
that amount; and further  provided that the Borrowers may
terminate in whole the Loan Commitments prior to Substantial Completion upon
payment in full of the Obligations (other than those which survive the
expiration or earlier termination of the Loan Documents).  The Borrowers’ notice to the Administrative
Agent shall designate the date (which shall be a Business Day) of such
termination or reduction and the amount of any partial reduction, and such
termination or reduction of such Commitments shall be effective on the date
specified in Borrowers’ notice and shall reduce such Commitment of each Lender
proportionately to its unfunded Commitment. 
Any such voluntary reduction of the Commitments shall be applied as
specified in subsection 2.4B(iv).

 

(iii)               Mandatory
Prepayments.  The Loans shall be
prepaid in the amounts and under the circumstances set forth below, all such
prepayments to be applied as set forth below or as more specifically provided
in subsection 2.4B(iv):

 

(a)                                  Change
of Control.  No later than the fifth
Business Day following any Change of Control.

 

(b)                                 Prepayments
From Net Asset Sale Proceeds.  No
later than the fifth Business Day following the date of receipt by the
Borrowers of any Net Asset Sale Proceeds in respect of any Asset Sale (other
than Net Asset Sale Proceeds in respect of the sale of (i) any obsolete worn
out or surplus assets or assets no longer used or useful in the business of the
Phase II Mall and (ii) construction equipment having a fair market value not in
excess of $4,000,000 prior to the Phase II Mall Release Date, but only in each
case to the extent reinvested in the business of the Borrowers within 180 days
of receipt), the Borrowers shall prepay the Loans in an aggregate amount equal
to such Net Asset Sale Proceeds.

 

(c)                                  Prepayments
from Net Loss Proceeds.  Subject to
the Disbursement Agreement and the Cooperation Agreement (to the extent
applicable to the Phase II Project), no later than the fifth Business Day on
which Net Loss Proceeds are required to be applied to prepayment of Loans
pursuant to the last sentence of this subsection 2.4A(iii)(c), the
Borrowers shall prepay the Loans in an amount equal to such Net Loss Proceeds; provided,
however, so long as no Event of Default has occurred and is continuing,
the Borrowers may use such Net Loss Proceeds to repair, restore and replace the
property or asset with respect to which such Net Loss Proceeds were paid in
order to compensate the Borrowers for the Event of Loss which occurred thereto
so long as such Net Loss Proceeds are used for such purposes within 365 days of
the Borrowers’ receipt of such Net Loss Proceeds or as otherwise required under
the Phase II Mall Sale

 

40

 

Agreement.  To the extent such Net Loss Proceeds are not
so reinvested, the Borrowers will make a prepayment of the Loans within five
Business Days of the end of such 365 day period.

 

(d)                                 Prepayments
Due to Incurrence of Debt.  On the
fifth Business Day following the date of receipt by the Borrowers, of the
proceeds (including Cash, real property or other property) (any such proceeds,
net of underwriting discounts and commissions and other reasonable costs and
expenses associated therewith, including reasonable legal fees and expenses,
being “Net Proceeds”) from the
incurrence of any debt of the Borrowers (other than any debt expressly
permitted under subsection 6.1), the Borrowers shall prepay the
Loans in an aggregate amount equal to 100% of such Net Proceeds.

 

(e)                                  Calculations
of Net Proceeds Amounts; Additional Prepayments Based on Subsequent
Calculations.  Concurrently with any
prepayment of the Loans pursuant to subsections 2.4A(iii)(a)-(d), the
Borrowers shall deliver to the Administrative Agent an Officers’ Certificate
demonstrating the calculation of the amount (the “Net Proceeds Amount”) of the applicable Net Asset Sale
Proceeds, Net Loss Proceeds or Net Proceeds, as the case may be, that gave rise
to such prepayment.  In the event that
the Borrowers shall subsequently determine that the actual Net Proceeds Amount
was greater than the amount set forth in such Officers’ Certificate, the
Borrowers shall promptly make an additional prepayment of the Loans in an
amount equal to the amount of such excess, and Borrowers shall concurrently
therewith deliver to the Administrative Agent an Officers’ Certificate
demonstrating the derivation of the additional Net Proceeds Amount resulting in
such excess.

 

(iv)              Application
of Prepayments.

 

(a)                                  Application
of Voluntary Prepayments by Type of Loan and Order of Maturity.  Any voluntary prepayments pursuant to subsection 2.4A(i)
shall be applied as specified by the Borrowers in the applicable notice of
prepayment; provided that in the event the Borrowers fail to specify the
Loans to which any such prepayment shall be applied, such prepayment shall be
applied first to repay outstanding Base Rate Loans to the full extent
thereof on a pro  rata basis and second to repay
outstanding Euro dollar Rate Loans on a pro  rata basis in each
case in a manner which minimizes the amount of any payments required to be made
by the Borrowers pursuant to subsection 2.6D.

 

(B)                                General
Provisions Regarding Payments.

 

(i)                     Manner
and Time of Payment.  All payments by
the Borrowers of principal, interest, fees and other Obligations hereunder and
under the Notes shall be made in Dollars in same day funds, without defense,
setoff or counterclaim, free of any restriction or condition, and delivered to
the Administrative Agent not later than 1:00 p.m. (New York City time) on
the date due at the Funding and Payment Office for the account of Lenders; for
purposes of computing interest and fees, funds received by the Administrative
Agent after that time on such due date shall be deemed to have been paid by the
Borrowers on the next succeeding Business Day. 
The Borrowers hereby

 

41

 

authorize the
Administrative Agent to charge their accounts with the Administrative Agent in
order to cause timely payment to be made to the Administrative Agent of all
principal, interest, fees and expenses due hereunder (subject to sufficient
funds being available in its accounts for that purpose).

 

(ii)                  Application
of Payments to Principal and Interest. 
All payments in respect of the principal amount of any Loan shall
include payment of accrued interest on the principal amount being repaid or
prepaid, and all such payments shall be applied to the payment of interest
before application to principal.

 

(iii)               Apportionment
of Payments.  Aggregate principal and
interest payments in respect of Loans shall be apportioned among all
outstanding Loans proportionately to Lenders’ respective Pro Rata Shares.  The Administrative Agent (or its agent or
sub-agent appointed by it) shall promptly distribute to each Lender, at its
primary address set forth on Schedule 2.1 or at such other address
as such Lender may request, its Pro Rata Share of all such payments and
Percentage of the commitment fees received by the Administrative Agent pursuant
to subsection 2.3. 
Notwithstanding the foregoing provisions of this subsection 2.4B(iii),
if, pursuant to the provisions of subsection 2.6C, any
Conversion/Continuation Notice is withdrawn as to any Affected Lender or if any
Affected Lender makes Base Rate Loans in lieu of its Percentage of any
Eurodollar Rate Loans, the Administrative Agent shall give effect thereto in
apportioning payments received thereafter.

 

(iv)              Payments
on Business Days.  Whenever any
payment to be made hereunder shall be stated to be due on a day that is not a
Business Day, such payment shall be made on the next succeeding Business Day
and, such extension of time shall be included in the computation of the payment
of interest hereunder or of the commitment fees hereunder, as the case may be.

 

(v)                 Notation
of Payment.  Each Lender agrees that
before disposing of any Note held by it, or any part thereof (other than by
granting participations therein), that Lender will make a notation thereon of
all Loans evidenced by that Note and all principal payments previously made
thereon and of the date to which interest thereon has been paid; provided
that the failure to make (or any error in the making of) a notation of any Loan
made under such Note shall not limit or otherwise affect the obligations of the
Borrowers hereunder or under such Note with respect to any Loan or any payments
of principal or interest on such Note.

 

2.5                                 Use of Proceeds.

 

(A)                              Phase
II Mall Project Costs.  The proceeds
of Borrowings shall be used to pay for the financing, design, development and
construction costs of the Phase II Mall as set forth therefor in the Project
Budget (including interest and fees relating to the Loans) and to reimburse the
Borrowers for design, development and construction costs for the Phase II Mall
for which payments have been made and which such payments exceed the initial
Phase II Mall Contribution of $25,371,098 but only so long as (i) such payments
were made by the Borrowers prior to the subdivision of the Phase II Land into
one or more separate legal parcels for the Phase

 

42

 

II
Mall Air Parcel, (ii) the initial Phase II Mall Contribution in the amount of
$25,371,098 has been fully funded and applied in accordance with the Phase II
Mall Construction Loan Documents and (iii) such reimbursement is for such
payments which exceed the initial Phase II Mall Contribution of $25,371,098.  In no event shall any proceeds of Borrowings
be used to pay for any damages, liquidated or otherwise, or other amounts
payable by LCR or the Borrowers pursuant to the Phase II Mall Sale Agreement
and/or the Phase II Mall SA Assignment Agreement or for operating costs of the
Phase II Mall (unless, in each case, such item is set forth in the Project
Budget as a separate Line Item) or for operating costs of the Phase II
Hotel/Casino.

 

(B)                                Margin
Regulations.  No portion of the
proceeds of any Borrowing under this Agreement shall be used by the Borrowers
or any of their Subsidiaries in any manner that might cause the Borrowing or
the application of such proceeds to violate Regulation U, Regulation T or
Regulation X of the Board of Governors of the Federal Reserve System or any
other regulation of such Board or to violate the Exchange Act, in each case as
in effect on the date or dates of such Borrowing and such use of proceeds.

 

2.6                                 Special Provisions Governing
Eurodollar Rate Loans.

 

Notwithstanding any other provision of this Agreement
to the contrary, the following provisions shall govern with respect to
Eurodollar Rate Loans as to the matters covered:

 

(A)                              Determination
of Applicable Interest Rate.  As soon
as practicable after 10:00 A.M. (New York City time) on each Interest Rate
Determination Date, the Administrative Agent shall determine (which
determination shall, absent manifest error, be final, conclusive and binding
upon all parties) the interest rate that shall apply to the Eurodollar Rate
Loans for which an interest rate is then being determined for the applicable
Interest Period and shall promptly give notice thereof (in writing or by
telephone confirmed in writing) to the Borrowers and each Lender.

 

(B)                                Inability
to Determine Applicable Interest Rate. 
In the event that the Administrative Agent shall have determined (which
determination shall be final and conclusive and binding upon all parties
hereto), on any Interest Rate Determination Date with respect to any Eurodollar
Rate Loans, that by reason of circumstances affecting the interbank Eurodollar
market adequate and fair means do not exist for ascertaining the interest rate
applicable to such Loans on the basis provided for in the definition of
Adjusted Eurodollar Rate, the Administrative Agent shall on such date give
notice (by telefacsimile or by telephone confirmed in writing) to the Borrowers
and each Lender of such determination, whereupon (i) no Loans may be made
as, or converted to, Eurodollar Rate Loans until such time as Administrative
Agent notifies the Borrowers and Lenders that the circumstances giving rise to
such notice no longer exist and (ii) any Borrowing Notice or
Conversion/Continuation Notice given by the Borrowers with respect to the Loans
in respect of which such determination was made shall be deemed to be made with
respect to Base Rate Loans.

 

(C)                                Illegality
or Impracticability of Eurodollar Rate Loans.  In the event that on any date any Lender
shall have determined (which determination shall be final and conclusive and
binding upon all parties hereto but shall be made only after consultation with
Borrowers and the Administrative Agent) that the making, maintaining or
continuation of its Eurodollar Rate Loans

 

43

 

(i) has
become unlawful as a result of compliance by such Lender in good faith with any
law, treaty, governmental rule, regulation, guideline or order not in effect on
the date such Person became a Lender (or would conflict with any such treaty,
governmental rule, regulation, guideline or order not having the force of law
even though the failure to comply therewith would not be unlawful), or
(ii) would cause such Lender material financial hardship as a result of
contingencies occurring after the date of this Agreement which materially and
adversely affect the interbank Eurodollar market or the position of such Lender
in that market, then, and in any such event, such Lender shall be an “Affected Lender” and it shall on that day
give notice (by telefacsimile or by telephone confirmed in writing) to the Borrowers
and the Administrative Agent of such determination (which notice the
Administrative Agent shall promptly transmit to each other Lender).  Thereafter (a) the obligation of the
Affected Lender to make Loans as, or to convert Loans to, Eurodollar Rate Loans
shall be suspended until such notice shall be withdrawn by the Affected Lender
(which such Affected Lender shall do at the earliest practicable date),
(b) to the extent such determination by the Affected Lender relates to a
Eurodollar Rate Loan then being requested by the Borrowers pursuant to a
Borrowing Notice or a Conversion/Continuation Notice, the Affected Lender shall
make such Loan as (or convert such Loan to, as the case may be) a Base Rate
Loan, (c) the Affected Lender’s obligation to maintain its outstanding
Eurodollar Rate Loans (the “Affected Loans”)
shall be terminated at the earlier to occur of the expiration of the Interest
Period then in effect with respect to the Affected Loans or when required by
law, and (d) the Affected Loans shall automatically convert into Base Rate
Loans on the date of such termination. 
Except as provided in the immediately preceding sentence, nothing in
this subsection 2.6C shall affect the obligation of any Lender other
than an Affected Lender to make or maintain Loans as, or to convert Loans to,
Eurodollar Rate Loans in accordance with the terms of this Agreement.

 

(D)                               Compensation
For Breakage or Non-Commencement of Interest Periods.  The Borrowers shall compensate each Lender,
upon written request by that Lender (which request shall set forth the basis
for requesting such amounts), for all reasonable losses, expenses and
liabilities (including any interest paid by that Lender to lenders of funds
borrowed by it to make or carry its Eurodollar Rate Loans and any loss, expense
or liability sustained by that Lender in connection with the liquidation or
re-employment of such funds) which that Lender may sustain: (i) if for any
reason (other than a default by that Lender) a borrowing of any Eurodollar Rate
Loan does not occur on a date specified therefor in a Borrowing Notice or a
telephonic request for borrowing, as applicable, or a conversion to or
continuation of any Eurodollar Rate Loan does not occur on a date specified
therefor in a Conversion/Continuation Notice or a telephonic request for
conversion or continuation, (ii) if any prepayment (including any
prepayment pursuant to subsection 2.4A(i)) or other principal payment or
any conversion of any of its Eurodollar Rate Loans occurs on a date prior to
the last day of an Interest Period applicable to that Loan, (iii) if any
prepayment of any of its Eurodollar Rate Loans is not made on any date
specified in a notice of prepayment given by the Borrowers, or (iv) as a
consequence of any other default by the Borrowers in the repayment of its
Eurodollar Rate Loans when required by the terms of this Agreement.

 

(E)                                 Booking
of Eurodollar Rate Loans.  Any Lender
may make, carry or transfer Eurodollar Rate Loans at, to, or for the account of
any of its branch offices or the office of an Affiliate of that Lender.

 

44

 

(F)                                 Assumptions
Concerning Funding of Eurodollar Rate Loans.  Calculation of all amounts payable to a
Lender under this subsection 2.6 and under subsection 2.7A shall
be made as though that Lender had actually funded each of its relevant
Eurodollar Rate Loans through the purchase of a Eurodollar deposit bearing
interest at the rate obtained pursuant to clause (a) of the definition
of Adjusted Eurodollar Rate in an amount equal to the amount of such Eurodollar
Rate Loan and having a maturity comparable to the relevant Interest Period and
through the transfer of such Eurodollar deposit from an offshore office of that
Lender to a domestic office of that Lender in the United States; provided,
however, that each Lender may fund each of its Eurodollar Rate Loans in
any manner it sees fit and the foregoing assumptions shall be utilized only for
the purposes of calculating amounts payable under this subsection 2.6
and under subsection 2.7A.

 

(G)                                Eurodollar
Rate Loans After Default.  After the
occurrence of and during the continuation of a Potential Event of Default or an
Event of Default, (i) Borrowers may not elect to have a Loan be made or
maintained as, or converted to, a Eurodollar Rate Loan after the expiration of
any Interest Period then in effect for that Loan and (ii) subject to the
provisions of subsection 2.6D, any Borrowing Notice or
Conversion/Continuation Notice given by the Borrowers with respect to a
requested borrowing or conversion/continuation that has not yet occurred shall
be deemed made with respect to Base Rate Loans.

 

2.7                                 Increased Costs; Taxes; Capital Adequacy.

 

(A)                              Compensation
for Increased Costs and Taxes. 
Subject to the provisions of subsection 2.7B (which shall be
controlling with respect to the matters covered thereby), in the event that any
Lender shall determine (which determination shall, absent manifest error, be
final and conclusive and binding upon all parties hereto) that any law, treaty
or governmental rule, regulation or order, or any change therein or in the
interpretation, administration or application thereof (including the
introduction of any new law, treaty or governmental rule, regulation or order),
or any determination of a court or Governmental Instrumentality, in each case
that becomes effective after the date hereof, or compliance by such Lender with
any guideline, request or directive issued or made after the date hereof by any
central bank or other Governmental Instrumentality or quasi-Governmental
Instrumentality (whether or not having the force of law):

 

(i)                     subjects
such Lender (or its applicable lending office) to any additional Tax (other
than any Tax on the overall net income of such Lender) with respect to this
Agreement or any of its obligations hereunder or any payments to such Lender
(or its applicable lending office) of principal, interest, fees or any other
amount payable hereunder;

 

(ii)                  imposes,
modifies or holds applicable any reserve (including any marginal, emergency,
supplemental, special or other reserve), special deposit, compulsory loan, FDIC
insurance or similar requirement against assets held by, or deposits or other
liabilities in or for the account of, or advances or loans by, or other credit
extended by, or any other acquisition of funds by, any office of such Lender
(other than any such reserve or other requirements with respect to Eurodollar
Rate Loans that are reflected in the definition of Adjusted Eurodollar Rate);
or

 

45

 

(iii)               imposes
any other condition (other than with respect to a Tax matter) on or affecting
such Lender (or its applicable lending office) or its obligations hereunder or
the interbank Eurodollar market;

 

and the result of any of
the foregoing is to increase the cost to such Lender of agreeing to make,
making or maintaining Loans hereunder or to reduce any amount received or
receivable by such Lender (or its applicable lending office) with respect
thereto; then, in any such case, the Borrowers shall promptly pay to
such Lender, upon receipt of the statement referred to in the next sentence,
such additional amount or amounts (in the form of an increased rate of, or a
different method of calculating, interest or otherwise as such Lender in its
sole discretion shall determine) as may be necessary to compensate such Lender
for any such increased cost or reduction in amounts received or receivable
hereunder.  Such Lender shall deliver to
the Borrowers (with a copy to the Administrative Agent) a written statement,
setting forth in reasonable detail the basis for calculating the additional
amounts owed to such Lender under this subsection 2.7A, which statement
shall be conclusive and binding upon all parties hereto absent manifest error.

 

(B)                                Withholding
of Taxes.

 

(i)                     Payments
to Be Free and Clear.  All sums
payable by the Borrowers under this Agreement and the other Loan Documents
shall (except to the extent required by law) be paid free and clear of, and
without any deduction or withholding on account of, any Tax (other than a Tax
on the overall net income of any Lender) imposed, levied, collected, withheld
or assessed by or within the United States or any political subdivision in or
of the United States or any other jurisdiction from or to which a payment is
made by or on behalf of the Borrowers or by any federation or organization of
which the United States or any such jurisdiction is a member at the time of
payment, all such non-excluded Taxes being hereinafter collectively referred to
as “Included Taxes”.

 

(ii)                  Grossing-up
of Payments.  If the Borrowers or any
other Person is required by law to make any deduction or withholding on account
of any such Included Tax from any sum paid or payable by the Borrowers to the
Administrative Agent or any Lender under any of the Loan Documents:

 

(a)                                  the
Borrowers shall notify the Administrative Agent of any such requirement or any
change in any such requirement as soon as the Borrowers become aware of it;

 

(b)                                 the
Borrowers shall pay any such Included Tax before the date on which penalties
attach thereto, such payment to be made (if the liability to pay is imposed on
the Borrowers) for its own account or (if that liability is imposed on the
Administrative Agent or such Lender, as the case may be) on behalf of and in
the name of the Administrative Agent or such Lender;

 

(c)                                  the
sum payable by the Borrowers in respect of which the relevant deduction,
withholding or payment is required shall be increased to the extent necessary

 

46

 

to ensure that,
after the making of that deduction, withholding or payment, the Administrative
Agent or such Lender, as the case may be, receives on the due date a net sum
equal to what it would have received had no such deduction, withholding or
payment been required or made; and

 

(d)                                 within
30 days after paying any sum from which it is required by law to make any
deduction or withholding, and within 30 days after the due date of payment of
any Included Tax which it is required by clause (b) above to pay, the
Borrowers shall deliver to the Administrative Agent evidence satisfactory to
the other affected parties of such deduction, withholding or payment and of the
remittance thereof to the relevant taxing or other authority;

 

provided
that no such additional amount shall be required to be paid to any Lender under
clause (c) above except to the extent that any change after the date
hereof (in the case of each Lender listed on the signature pages hereof) or
after the date of the Assignment Agreement pursuant to which such Lender became
a Lender (in the case of each other Lender) in any such requirement for a
deduction, withholding or payment as is mentioned therein shall result in an
increase in the rate of such deduction, withholding or payment from that in
effect at the date of this Agreement or at the date of such Assignment
Agreement, as the case may be, in respect of payments to such Lender; provided,
however, that in the case of an assignment, if the assignor was entitled to
additional amounts pursuant to this Section 2.7B, then such assignee
shall be entitled to such additional amounts.

 

(iii)               Evidence
of Exemption from U.S. Withholding Tax.

 

(a)                                  Each
Lender that is organized under the laws of any jurisdiction other than the
United States or any state or other political subdivision thereof (a “Non-US Lender”) shall deliver to the
Administrative Agent for transmission to the Borrowers, on or prior to the
Closing Date (in the case of each Lender listed on the signature pages hereof)
or on or prior to the date of the Assignment Agreement pursuant to which it
becomes a Lender (in the case of each other Lender), and at such other times as
may be necessary in the determination of the Borrowers or the Administrative
Agent (each in the reasonable exercise of its discretion), (1) two
original copies of Internal Revenue Service Form W-8BEN or W-8ECI (or any
successor forms), properly completed and duly executed by such Lender, together
with any other certificate or statement of exemption required under the Code or
the regulations issued thereunder to establish that such Lender is not subject
to deduction or withholding of United States federal income tax with respect to
any payments to such Lender of principal, interest, fees or other amounts
payable under any of the Loan Documents or (2) if such Lender is not a “bank”
or other Person described in Section 881(c)(3) of the Code, a Certificate
of Non-Bank Status together with two original copies of Internal Revenue
Service Form W-8BEN or W-8ECI (or any successor form), properly completed and
duly executed by such Lender, together with any other certificate or statement
of exemption required under the Code or the regulations issued thereunder to
establish that such Lender is not subject to deduction or withholding of United
States federal income tax with respect to any payments to such Lender of
interest payable under any of the Loan Documents.  Notwithstanding the foregoing, no Lender

 

47

 

shall be obligated
to provide any documentation pursuant to this subsection 2.7B(iii)(a) if
such Lender is not legally able to do so.

 

(b)                                 Each
Lender required to deliver any forms, certificates or other evidence with
respect to United States federal income tax withholding matters pursuant to subsection 2.7B(iii)(a)
hereby agrees, from time to time after the initial delivery by such Lender of
such forms, certificates or other evidence, whenever a lapse in time or change
in circumstances renders such forms, certificates or other evidence obsolete or
inaccurate in any material respect, that such Lender shall promptly
(1) deliver to the Administrative Agent for transmission to the Borrowers
a Certificate of Non-Bank Status and two original copies of Internal Revenue
Service Form W-8BEN or W-8ECI, as the case may be, properly completed and duly
executed by such Lender, together with any other certificate or statement of
exemption required in order to confirm or establish that such Lender is not
subject to deduction or withholding of United States federal income tax with
respect to payments to such Lender under the Loan Documents or (2) notify
Administrative Agent and Borrowers of its inability to deliver any such forms,
certificates or other evidence.

 

(c)                                  Borrowers
shall not be required to pay any additional amount to any Non-US Lender under subsection 2.7B(ii)(c)
if such Lender shall have failed to satisfy the requirements of clause (a)
or (b)(1) of this subsection 2.7B(iii); provided
that if such Lender shall have satisfied the requirements of subsection 2.7B(iii)(a)
on the Closing Date (in the case of each Lender listed on the signature pages
hereof) or on the date of the Assignment Agreement pursuant to which it became
a Lender (in the case of each other Lender), nothing in this subsection
2.7B(iii)(c) shall relieve Borrowers of their obligation to pay any
additional amounts pursuant to clause (c) of subsection 2.7B(ii)
in the event that, as a result of any change in any applicable law, treaty or
governmental rule, regulation or order, or any change in the interpretation,
administration or application thereof, such Lender is no longer properly
entitled to deliver forms, certificates or other evidence at a subsequent date
establishing the fact that such Lender is not subject to withholding as
described in subsection 2.7B(iii)(a).

 

(C)                                Capital
Adequacy Adjustment.  If any Lender
shall have determined that the adoption, effectiveness, phase-in or
applicability after the date hereof of any law, rule or regulation (or any
provision thereof) regarding capital adequacy, or any change therein or in the
interpretation or administration thereof after the date hereof by any
Governmental Instrumentality, central bank or comparable agency charged with
the interpretation or administration thereof, or compliance by any Lender (or
its applicable lending office) with any guideline, request or directive
regarding capital adequacy (whether or not having the force of law) of any such
Governmental Instrumentality, central bank or comparable agency, has or would
have the effect of reducing the rate of return on the capital of such Lender or
any corporation controlling such Lender as a consequence of, or with reference
to, such Lender’s Loans or Commitments or participations therein or other
obligations hereunder with respect to the Loans to a level below that which
such Lender or such controlling corporation could have achieved but for such
adoption, effectiveness, phase-in, applicability, change or compliance (taking
into consideration the policies of such Lender or such controlling corporation
with regard to capital adequacy), then from time to time, within five Business
Days after receipt by the

 

48

 

Borrowers
from such Lender of the statement referred to in the next sentence, the
Borrowers shall pay to such Lender such additional amount or amounts as will
compensate such Lender or such controlling corporation on an after-tax basis
for such reduction.  Such Lender shall
deliver to the Borrowers (with a copy to the Administrative Agent) a written
statement, setting forth in reasonable detail the basis of the calculation of
such additional amounts, which statement shall be conclusive and binding upon
all parties hereto absent manifest error.

 

2.8                                 Obligation of Lenders to Mitigate.

 

Each Lender agrees that, as promptly as practicable
after the officer of such Lender responsible for administering the Loans of
such Lender becomes aware of the occurrence of an event or the existence of a
condition that would cause such Lender to become an Affected Lender or that
would entitle such Lender to receive payments under subsection 2.7 it
will, to the extent not inconsistent with the internal policies of such Lender
and any applicable legal or regulatory restrictions, use reasonable efforts
(i) to make, issue, fund or maintain the Commitments of such Lender or the
affected Loans of such Lender through another lending office of such Lender or
(ii) take such other measures as such Lender may deem reasonable, if as a
result thereof the circumstances which would cause such Lender to be an
Affected Lender would cease to exist or the additional amounts which would
otherwise be required to be paid to such Lender pursuant to subsection 2.7
would be materially reduced and if, as determined by such Lender in its sole
discretion, the making, issuing, funding or maintaining of such Commitments or
Loans through such other lending office or in accordance with such other
measures, as the case may be, would not otherwise materially adversely affect such
Commitments or Loans or the interests of such Lender; provided that such
Lender will not be obligated to utilize such other lending office pursuant to
this subsection 2.8 if such Lender would incur incremental expenses as a
result of utilizing such other lending office as described in clause (i)
above.  A certificate as to the amount of
any such expenses payable by the Borrowers pursuant to this subsection 2.8
(setting forth in reasonable detail the basis for requesting such amount)
submitted by such Lender to the Borrowers (with a copy to the Administrative
Agent) shall be conclusive absent manifest error.  Each Lender agrees that it will not request
compensation under subsection 2.7 unless such Lender requests
compensation from borrowers under other lending arrangements with such Lender
who are similarly situated.

 

2.9                                 Obligations Joint and Several.

 

Anything herein to the contrary notwithstanding, each
Borrower hereby agrees and acknowledges that the obligation of each Borrower
for payment of the Obligations shall be joint and several with the obligations
of the other Borrower hereunder regardless of which Borrower actually receives
the proceeds or benefits of any borrowing hereunder.  Each Borrower hereby agrees and acknowledges
that it will receive substantial benefits from the Loans made available under
this Agreement.

 

Each Borrower agrees that its joint and several
obligation to pay all Obligations hereunder is irrevocable, absolute,
independent and unconditional and shall not be affected by any circumstance
which constitutes a legal or equitable discharge of a guarantor or surety other
than the indefeasible payment in full of the Obligations, and the liability of
each Borrower with respect to the Obligations shall not be affected, reduced or
impaired by (i) consideration of the

 

49

 

amount of proceeds
of the Loans received by any Borrower relative to the aggregate amount of the
Loans, (ii) the dissolution or termination of or any increase, decrease or change
in personnel of, any Borrower, (iii) the insolvency or business failure of, or
any assignment for the benefit of creditors by, or the commencement of any
bankruptcy, reorganization, arrangement, moratorium or other debtor relief
proceedings by or against the other Borrower or (iv) the appointment of a
receiver for, or the attachment, restraint of or making or levying of any order
of court or legal process affecting, the property of the other Borrower.  Each Borrower agrees that a separate action
or actions may be brought and prosecuted against such Borrower whether or not
action is brought against the other Borrower and whether or not the other
Borrower is joined in any such action or actions.  Either Borrower’s payment of a portion, but
not all, of the Obligations shall in no way limit, affect, modify or abridge
such Borrower’s liability for that portion of the Obligations which is not
paid.

 

Each Borrower hereby waives any right to require the
Administrative Agent or any Lender, as a condition of payment or performance of
the Obligations by such Borrower, to proceed against the other Borrower or any
other Person, to exhaust any security held from any Borrower, or pursue any
other remedy in the power of the Administrative Agent or any Lender.  Each Borrower hereby waives any defense
arising by reason of incapacity, lack of authority or any disability or other
defense that may be available to the other Borrower and any defenses or
benefits that may be derived or afforded by law which would limit the liability
of or exonerate any guarantor or surety with respect to the Obligations, or
which may conflict with the terms and provisions of this Agreement, other than
the indefeasible payment in full of the Obligations.

 

Any indebtedness of a Borrower now or hereafter held
by the other Borrower is hereby subordinated in right of payment to the
Obligations, and any such indebtedness of a Borrower to the other Borrower
collected or received by such other Borrower after an Event of Default has
occurred and is continuing shall be held in trust for the Administrative Agent
on behalf of the Lenders and shall forthwith be paid over to the Administrative
Agent for the benefit of the Lenders to be credited and applied against the
Obligations but without affecting, impairing or limiting in any manner the
liability of such other Borrower under any other provision of this Agreement.

 

3.                                       Conditions to Credit Extensions.

 

The obligations of Lenders to make Credit Extensions
hereunder are subject to the satisfaction (or waiver) of the following
conditions.

 

3.1                                 Conditions to the Occurrence of the
Closing Date.

 

The conditions to the occurrence of the Closing Date
are:

 

(A)                              Organization
and Authorization Documents.  The
Borrowers shall have delivered to the Administrative Agent the following with
respect to each of the Borrowers, Venetian, LVSI and LCR, each, unless
otherwise noted, dated the Closing Date:

 

(i)                     copies
of the Organizational Documents of such Person, certified by the Secretary of
State of its jurisdiction of organization if such certification is generally

 

50

 

available dated a
recent date prior to the Closing Date and in each other case, by such Person’s
secretary or assistant secretary;

 

(ii)                  to
the extent generally available, a good standing certificate from the Secretary
of State of its jurisdiction of organization and a certificate or other
evidence of good standing as to payment of any applicable franchise or similar
taxes from the appropriate taxing authority of such jurisdiction, each dated a
recent date prior to the Closing Date;

 

(iii)               resolutions
of the Board of Directors of such Person approving and authorizing the
execution, delivery and performance of the Loan Documents and the Phase II Mall
Contribution Documents (in the case of the Borrowers) to which such Person is a
party and the Environmental Indemnity (in the case of LCR, Venetian and LVSI)
being executed on the Closing Date, certified as of the Closing Date by the
corporate secretary or an assistant secretary of such Person as being in full
force and effect without modification or amendment;

 

(iv)              signature
and incumbency certificates of the officers of such Person executing the Loan
Documents being executed on the Closing Date to which it is a party; and

 

(v)                 such
other documents as Administrative Agent may reasonably request, all of which
shall be reasonably satisfactory to the Administrative Agent.

 

(B)                                Notes.  The Administrative Agent shall have received
all Notes requested by Lenders prior to the Closing Date executed by the
Borrowers.

 

(C)                                No
Material Adverse Change.  Since
December 31, 2003 there shall not have been any adverse change, or any
development involving a prospective adverse change, in or affecting the general
affairs, management, financial position, liabilities (contingent or otherwise),
shareholders’ equity or results of operations of LVSI and its Subsidiaries,
taken as a whole, or the Borrowers and their respective Subsidiaries, taken as
a whole, which the Administrative Agent, in its reasonable judgment, deems
material.

 

(D)                               Financial
Statements.  The Lenders shall have
received the consolidated and consolidating audited financial statements for
LVSI for the period ended December 31, 2003 and the consolidated unaudited
financial statements for the most recently available monthly and quarterly
period for LVSI and for the Borrowers (in form and substance reasonably
satisfactory to the Administrative Agent).

 

(E)                                 Deed
of Trust; Mortgage Policies; Etc. 
The Administrative Agent shall have received from the Borrowers:

 

(i)                     Deed
of Trust.  Fully executed and
notarized Deed of Trust, duly recorded in the appropriate filing or recording
office in the jurisdiction in which each parcel of Mortgaged Property is
located or evidence that such Deed of Trust has been irrevocably delivered to
the Title Company for such recordation;

 

51

 

(ii)                  Title
Insurance.  (a) A 1970 (amended
October 17, 1970) ALTA mortgagee title insurance policy or policies
(collectively, the “Mortgage Policy”)
issued by the Title Company with respect to the Mortgaged Property in an amount
not less than the maximum aggregate amount of the Commitments, in each case,
insuring for the benefit of the Administrative Agent on behalf of the Secured
Parties that the Deed of Trust creates a valid and enforceable First Priority
deed of trust Lien on the Mortgaged Property, subject only to Permitted Liens,
which Mortgage Policy (1) shall include an endorsement for mechanics’
liens, for future advances under this Agreement and for any other matters
reasonably requested by the Administrative Agent and available in the state in
which the Mortgaged Property is located and (2) shall provide for
affirmative insurance and such reinsurance as the Administrative Agent may
reasonably request, all of the foregoing in form and substance satisfactory to
the Administrative Agent; and (b) evidence reasonably satisfactory to the
Administrative Agent that the Borrowers have or have caused to be
(i) delivered to the Title Company all certificates and affidavits
required by the Title Company in connection with the issuance of the Mortgage
Policy, (ii) paid to the Title Company or to the appropriate Governmental
Instrumentalities all expenses and premiums of the Title Company in connection
with the issuance of the Mortgage Policy and (iii) paid to the Title
Company or the appropriate Governmental Instrumentalities all recording and
stamp taxes (including mortgage recording and intangible taxes) payable in
connection with recording the Deed of Trust in the appropriate real estate
records;

 

(iii)               A.L.T.A.
Surveys.  The Administrative Agent
shall have received an A.L.T.A. survey of the Site, the Phase II Mall Air
Space, the portion of the Phase II Mall Air Space covered by the Walgreens
Lease and the portion of the Phase II Mall Space subject to the Phase II Mall
Lease, the Site Easements and the Phase II Mall Space Easements, satisfactory
in form and substance to the Title Insurer and the Administrative Agent,
reasonably current and certified to each such Person by a licensed surveyor
satisfactory to each such Person, showing (a) as to the Site, the Phase II
Mall Air Space, the Phase II Mall Air Parcel, the portion of the Phase II Mall
Space covered by the Walgreens Lease, the exact location and dimensions
thereof, including the location of all means of access thereto and all
easements relating thereto and showing the perimeter within which all
foundations are or are to be located; (b) as to the Site Easements and the
Phase II Mall Space Easements, the exact location and dimensions thereof (to
the extent such easements are described as covering specific portions of the
Site and/or the Phase II Mall Space, as the case may be), including the
location of all means of access thereto, and all improvements or other
encroachments in or on the Site Easements and/or the Phase II Mall Space
Easements, as the case may be; (c) the existing utility facilities
servicing the Site and the Central Park West Site (including water,
electricity, gas, telephone, sanitary sewer and storm water distribution and
detention facilities); (d) unless covered by appropriate endorsements
under the Title Insurance Policies, that there are no gaps, gores, projections,
protrusions or other survey defects other than the Permitted Liens;
(e) whether the Site, the Phase II Mall Space and the Central Park West
Site or any portion thereof is located in a flood hazard zone; and
(f) that there are no other matters that could reasonably be expected to
be disclosed by a survey constituting a defect in title other than the
Permitted Liens.

 

52

 

(iv)              Zoning.  The Administrative Agent shall have received
(a) an opinion from counsel satisfactory to the Administrative Agent that the
Phase II Project is zoned in a classification which will permit the
construction and use thereof for all purposes intended, or (b) in lieu of item
(a), (i) a certificate from the applicable Governmental Instrumentality with
respect to the zoning of the Site that the Phase II Project is zoned in a
classification which will permit the construction and use thereof for all
purposes intended, (ii) the building permits and excavation permits issued
prior to the Closing Date by such Governmental Instrumentality based upon the
Plans and Specifications approved by it, and (iii) evidence reasonably
satisfactory to the Administrative Agent that the Phase II Project, upon
completion thereof in accordance with the Plans and Specifications approved by
such Governmental Instrumentality, will comply with all applicable zoning,
subdivision, condominium and building statutes, codes, ordinances, regulations,
variances and special regulations.

 

(v)                 Subordination,
Non-Disturbance and Attornment Agreements. 
The Administrative Agent shall have received a Subordination,
Non-Disturbance and Attornment Agreement, substantially in the form of Exhibit
G-1, from all Persons holding a monetary Lien encumbering the real property
covered by the Walgreens Lease and each tenant party to a lease set forth on Schedule
6.6; provided, however, the form of Subordination,
Non-Disturbance and Attornment Agreement to be delivered by such tenant party
may be in a different form if such form is otherwise reasonably acceptable to
the Administrative Agent, or the Administrative Agent shall be satisfied that
each such lease contains reasonably comparable (or better) terms as to
subordination, attornment and non-disturbance with respect to its tenant as
would be obtained were an agreement in the form of Exhibit G-1.

 

(vi)              Leasehold
Mortgagee Protection.  The
Administrative Agent shall have received an Estoppel Certificate, substantially
in the form of Exhibit G-2 or otherwise acceptable to the Administrative Agent
from each landlord (other than a Borrower) party to a lease set forth on Schedule
6.6 and the landlord under the Walgreens Lease, together with copies of
notices which have been delivered to each landlord advising same of the
existence of a leasehold mortgage on the leased premises subject to each such
lease, satisfying the notice requirements of such lease, and in form and
substance satisfactory to the Administrative Agent.  To the extent that any such lease does not
include mortgagee protection provisions reasonably acceptable to the
Administrative Agent, such Estoppel Certificate shall include such mortgagee
protection provisions reasonably required by the Administrative Agent.

 

(vii)           Environmental
Indemnity.  The Administrative Agent
shall have received the Environmental Indemnity, dated as of the Closing Date,
duly executed and delivered by an Authorized Officer of each Borrower, LCR,
Venetian and LVSI.

 

(viii)        Correction
of Environmental Conditions.  The
Administrative Agent shall have received (i) a letter from Converse Consultants
in form and substance reasonably satisfactory to the Administrative Agent,
confirming that LVSI and Venetian have installed (and/or have caused Existing
Facility tenants to install, as the case may be) appropriate secondary
containment devices at each hazardous materials

 

53

 

storage area
located in the Existing Facilities, and (ii) from Converse Consultants, final
versions of the two matrices provided in draft form to the Administrative Agent
on June 7, 2004, in form and substance reasonably satisfactory to the
Administrative Agent evidencing that (x) all previously identified issues of
concern or recognized environmental conditions relating to hazardous materials
storage have been corrected and (y) the matrices remain true, correct and
complete to Converse Consultant’s knowledge without any further changes from
the June 7, 2004 version.

 

(F)                                 Security
Agreement.  The Administrative Agent
shall have received, with counterparts for each Lender, the Security Agreement,
each dated as of the Closing Date, duly executed and delivered by an Authorized
Officer of each of the Borrowers.

 

(G)                                Security
Interests in Personal and Mixed Property. 
The Administrative Agent shall have received evidence reasonably
satisfactory to it that the Borrowers shall have taken or caused to be taken
all such actions, executed and delivered or caused to be executed and delivered
all such agreements, documents and instruments, and made or caused to be made
all such filings and recordings (other than the filing or recording of items
described in clauses (iii) and (iv) below) that may be
necessary or, in the reasonable opinion of the Administrative Agent, desirable
in order to create in favor of the Administrative Agent, for the benefit of the
Secured Parties, a valid and (upon such filing and recording) perfected First
Priority security interest in the Collateral. 
Such actions shall include the following:

 

(i)                     Schedules
to Collateral Documents.  Delivery to
the Administrative Agent of accurate and complete schedules to all of the
applicable Collateral Documents;

 

(ii)                  Instruments.  Delivery to the Administrative Agent of all
promissory notes or other instruments (duly endorsed, where appropriate, in a
manner satisfactory to the Administrative Agent) evidencing any Collateral;

 

(iii)               Lien
Searches and UCC Termination Statements. 
Delivery to the Administrative Agent of (a) the results of a recent
search, by a Person reasonably satisfactory to the Administrative Agent, of all
effective UCC financing statements and fixture filings and all judgment and tax
lien filings which may have been made with respect to any personal or mixed
property of either of the Borrowers, together with copies of all such filings
disclosed by such search, and (b) UCC termination statements duly executed
by all applicable Persons for filing in all applicable jurisdictions as may be
necessary to terminate any effective UCC financing statements or fixture
filings disclosed in such search (other than any such financing statements or
fixture filings in respect of Liens permitted to remain outstanding pursuant to
the terms of this Agreement); and

 

(iv)              UCC
Financing Statements and Fixture Filings. 
Delivery to the Administrative Agent of UCC financing statements and,
where appropriate, fixture filings and United States Patent and Trademark
Office filings, duly executed by each of the Borrowers with respect to all
personal and mixed property Collateral of such Person, for filing in all
jurisdictions as may be necessary or, in the reasonable opinion

 

54

 

of the
Administrative Agent, desirable to perfect the security interests created in
such Collateral pursuant to the Collateral Documents, including those listed on
Schedule 3.1G(iv).

 

(H)                               Assignment
of Phase II Mall Sale Agreement.  The
Administrative Agent shall have received the Assignment of Phase II Mall Sale
Agreement, dated as of the Closing Date, duly executed and delivered by an
Authorized Officer of Phase II Mall Subsidiary Holding.

 

(I)                                    Solvency
Assurances.  On the Closing Date, the
Lenders shall have received a Financial Condition Certificate from the
Borrowers dated the Closing Date, substantially in the form of Exhibit E
hereto and with appropriate attachments and otherwise reasonably satisfactory
to the Administrative Agent, in each case demonstrating that, after giving
effect to the transactions contemplated by this Agreement including the
Borrowing of the full amount of Commitments as contemplated hereunder and the
borrowing of the Phase II Mall Contribution, the Borrowers will be Solvent.

 

(J)                                   Opinions
of Counsel to the Borrowers.  The
Lenders and their respective counsel shall have received (i) originally
executed copies of one or more favorable written opinions of Paul, Weiss,
Rifkind, Wharton & Garrison, counsel for the Borrowers, and
(ii) originally executed copies of one or more favorable written opinions
of Lionel Sawyer & Collins, Nevada counsel for the Borrowers, each in form
and substance reasonably satisfactory to the Administrative Agent and its
counsel, dated as of the Closing Date and setting forth substantially the
matters in the opinions designated in Exhibits F-1 and F-2
hereto, respectively, and as to such other matters as the Administrative Agent
may reasonably request.  The Borrowers
hereby acknowledge and confirm that they have requested such counsel to deliver
such opinions to the Lenders.

 

(K)                               Consummation
of Transactions.

 

(i)                     The
Administrative Agent shall have received evidence satisfactory to it that all
actions necessary to consummate the transactions contemplated hereby shall have
been taken in accordance with all Legal Requirements.

 

(ii)                  The
Borrowers shall have entered into the Phase II Mall Contribution Documents and
Venetian shall have deposited the Phase II Mall Contribution into the Phase II
Mall Equity Account (collectively, the “Transactions”)
and the terms and documentation of the foregoing Transactions shall be
reasonably satisfactory in all respects to the Arranger, the Administrative
Agent and their respective counsel.

 

(L)                                 Fees.  The Borrowers shall have paid to Arranger,
for distribution (as appropriate) to Agents and Lenders, the fees payable on
the Closing Date referred to in subsection 2.3 and the expenses
payable on the Closing Date referred to in subsection 9.2.

 

(M)                            Completion
of Proceedings.  All corporate and
other proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
reasonably acceptable by the Arranger and the Administrative Agent, acting on
behalf of Lenders, and their respective counsel shall be reasonably
satisfactory in form and substance to the Arranger and the Administrative Agent
and such counsel, and the

 

55

 

Administrative
Agent and its counsel shall have received all such counterpart originals or
certified copies of such documents as Administrative Agent may reasonably
request.

 

(N)                               Service
of Process.  The Administrative Agent
shall have received a letter from Corporation Service Company, presently
located at 80 State Street, Albany, New York 12207 or any other Person
reasonably satisfactory to the Arranger consenting to its appointment by each
Borrower in each case in form and substance acceptable to the Arranger, as each
such Person’s agent to receive service of process in New York, New York.

 

(O)                               Litigation.  There shall be no actions, suits,
proceedings, arbitrations or governmental investigations (whether or not
purportedly on behalf of LVSI, Venetian, the Borrowers or any of their
Subsidiaries) at law or in equity, or before or by any federal, state,
municipal or other governmental department, commission, board, bureau, agency
or instrumentality, domestic or foreign (including any Environmental Claims)
that are pending or, to the knowledge of the Borrowers, threatened against or
affecting LVSI, Venetian or any of their Restricted Subsidiaries or the
Borrowers or any property of the Borrowers that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse Effect.

 

(P)                                 Real
Estate Appraisal.  The Administrative
Agent shall have received a FIRREA-compliant MAI Appraisal of all real property
comprising Collateral from an independent real estate appraiser in form, scope,
substance and amount reasonably satisfactory to the Administrative Agent and
satisfying the requirements of any applicable laws and regulations, which such
appraisal shall state a completion value of such real property Collateral of
$525.0 million or more.

 

(Q)                               Insurance.  The Borrowers shall have insurance complying
with the requirement of subsection 5.4B in place and in full force and
effect, and the Administrative Agent shall have received (i) a certificate from
the Borrowers’ insurance broker reasonably satisfactory to the Administrative
Agent stating that such insurance is in place and in full force and effect and
(ii) certified copies of all policies evidencing such insurance (or a binder,
commitment or certificates signed by the insurer or a broker authorized to bind
the insurer along with a commitment to issue the policies within 45 days after
the Closing Date) naming the Administrative Agent on behalf of the Lenders as
an additional insured or loss payee, as its interests may appear, and otherwise
in form and substance reasonably satisfactory to the Administrative Agent.

 

(R)                                Phase
II Mall Contribution Documents.  The
Phase II Mall Contribution Documents shall have terms, including without
limitation, maturity, interest rates, covenants and events of default in form
and substance reasonably satisfactory to the Administrative Agent.  All such documentation shall be in full force
and effect.

 

(S)                                 Phase
II Mall SA Assignment Agreement.  The
Phase II Mall Sale Agreement shall be assigned by LCR to Phase II Mall
Subsidiary Holding (subject to certain defense rights which are to be shared by
LCR and Phase II Mall Subsidiary Holding) in accordance with the Phase II Mall
SA Assignment Agreement.  The Phase II
Mall SA Assignment Agreement shall be in full force and effect.

 

56

 

(T)                                Disbursement
Agreement.  The Administrative Agent
and all other Persons party thereto shall have executed and delivered the
Disbursement Agreement, and each of the conditions precedent to the Effective
Date set forth in the Disbursement Agreement shall have been satisfied (or
waived by the Administrative Agent and the Bank Administrative Agent).

 

Each Lender by execution and delivery of a signature
page hereto on the Closing Date confirms that it is satisfied that each of the
conditions set forth above in this subsection 3.1 has been satisfied
provided that neither such confirmation nor any extension of credit hereunder
shall preclude any Lender or the Administrative Agent from later asserting that
(and enforcing any rights or remedies it may have if), any representation,
warranty or certification made or deemed made by the Borrowers or any of their
Affiliates in connection therewith was not true and accurate in all material
respects when made.

 

3.2                                 Additional Conditions to Loans on or
after the Closing Date.

 

The obligations of Lenders to make Loans on or after
the Closing Date on any Funding Date are subject to the following further
conditions precedent:

 

(A)                              Borrowing
Request.  The Administrative Agent
shall have received before that Funding Date, in accordance with the provisions
of subsection 2.1B, an originally executed Borrowing Notice and, in
accordance with the provisions of subsection 3.5.4 of the Disbursement
Agreement, an originally executed Advance Request together with all
attachments, exhibits and certificates required thereby, in each case signed by
the chief executive officer, the chief financial officer or the treasurer of
each Borrower or of the managing member of such Borrower or by any executive
officer of such Borrower or managing member designated by any of the
above-described officers on behalf of the Borrowers in a writing delivered to
the Administrative Agent.  Each Borrowing
Notice shall set forth whether the Loans being advanced pursuant thereto shall
be Base Rate Loans or Eurodollar Rate Loans (and, if applicable, the initial
Interest Period requested therefor).

 

(B)                                Representations
and Warranties.  As of such Funding
Date:

 

(i)                     The
representations and warranties contained herein and in the other Loan Documents
shall be true, correct and complete in all material respects on and as of that
Funding Date to the same extent as though made on and as of that date, except
to the extent such representations and warranties specifically relate to an
earlier date, in which case such representations and warranties shall have been
true, correct and complete in all material respects on and as of such earlier
date;

 

(ii)                  No
event shall have occurred and be continuing or would result from the
consummation of the Borrowing contemplated by such Borrowing Notice that would
constitute an Event of Default or a Potential Event of Default;

 

(iii)               The
Borrowers shall have performed in all material respects all agreements and
satisfied all conditions which this Agreement and the Disbursement Agreement
provides shall be performed or satisfied by it on or before that Funding Date;

 

57

 

(iv)              No
order, judgment or decree of any court, arbitrator or Governmental
Instrumentality shall purport to enjoin or restrain any Lender from making the
Loans to be made by it on that Funding Date;

 

(v)                 The
making of the Loans requested on such Funding Date shall not violate any law
including, Regulation T, Regulation U or Regulation X of the Board of Governors
of the Federal Reserve System; and

 

(vi)              There
shall not be pending or, to the knowledge of the Borrowers, threatened, any
action, suit, proceeding, governmental investigation or arbitration against or
affecting the Borrowers, any of their Subsidiaries or any property of the
Borrowers or their Subsidiaries that is required to be disclosed under, and has
not been disclosed by the Borrowers in writing pursuant to, subsection 4.6
or 5.1(v) prior to the making of the last preceding Loans, and there
shall have occurred no development not so disclosed in any such action, suit,
proceeding, governmental investigation or arbitration so disclosed, that, in
either event, in the reasonable opinion of the Administrative Agent, would have
a Material Adverse Effect.

 

(C)                                Title
Policy Endorsement.  The
Administrative Agent shall have received an endorsement to the Title Policies
in the form of a 122 CLTA Endorsement insuring the continuing First Priority of
the Lien of the Deed of Trust (subject to Permitted Liens) as security for the
requested Loans on the date such Loans are made and insuring that (i) as of the
date of the initial Credit Extension or, if applicable, since the previous
Credit Extension (if a subsequent Credit Extension), there has been no change
in the condition of title unless permitted by the Loan Documents, and (ii)
there are no intervening Liens or encumbrances (including inchoate mechanic’s
liens) which may then or thereafter take priority over the Lien of the Deed of
Trust (subject to Permitted Liens and such intervening liens or encumbrances
securing amounts the payment of which are being disputed in good faith, so long
as the Title Company has delivered to the Administrative Agent an endorsement
or affirmative coverage to the Mortgage Policy reasonably satisfactory to the
Administrative Agent assuring against loss to the Secured Parties due to the
priority of such lien or encumbrance).

 

(D)                               Subdivision
of the Site.  Until such time as
Phase II Mall Air Parcel has been created and the Phase II Mall Lease has been
terminated, the conditions in subsection 5.11(b) of the Disbursement Agreement
shall be satisfied with respect to any separate parcels which have been
subdivided since the last Borrowing.

 

(E)                                 Phase
II Mall Recognition Agreement.  The
Administrative Agent shall have received executed counterparts from GGP, LCR
and the Borrowers of a recognition agreement with respect to the Phase II Mall
Sale Agreement in form, scope and substance satisfactory to the Requisite
Lenders (as the same may be amended, supplemented, amended and restated, or
otherwise modified in accordance with the terms hereof, the “Phase II Mall Recognition Agreement”) and any supplements or
amendments thereto, all of which shall have been duly authorized, executed and
delivered by the parties thereto, and shall be certified by an Authorized
Officer of each of the Borrowers and LCR as being true, complete and correct
and in full force and effect.

 

58

 

4.                                       Borrowers’ Representations and Warranties.

 

In order to induce Lenders to enter into this
Agreement and to make Credit Extensions, the Borrowers represent and warrant to
each Lender that, on the Closing Date and on each Funding Date, each of the
following statements and the representations and warranties set forth in the
Disbursement Agreement are true, correct and complete.

 

4.1                                 Organization, Powers, Qualification, Good
Standing, Business and Subsidiaries.

 

(A)                              Organization
and Powers.  Each of the Borrowers is
a limited liability company duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization as specified in Schedule
4.1A annexed hereto.  Each of the
Borrowers has all requisite limited liability company power and authority to
own and operate its properties, to carry on its business as now conducted and
as proposed to be conducted, to enter into the Loan Documents and the other
Operative Documents to which it is a party and to carry out the transactions
contemplated thereby.

 

(B)                                Qualification
and Good Standing.  Each of the
Borrowers is qualified to do business and in good standing in every
jurisdiction where its assets are located and wherever necessary to carry out
its business and operations, except in jurisdictions where the failure to be so
qualified or in good standing has not had and would not reasonably be expected
to have a Material Adverse Effect.

 

(C)                                Ownership
of the Borrowers.  The equity
interests in each of the Borrowers are duly authorized, validly issued and (if
applicable) fully paid and nonassessable and, as of the Closing Date, none of
such equity interests constitute Margin Stock. 
Schedule 4.1C, as it may be supplemented from time to time,
correctly sets forth the ownership of each Borrower.

 

(D)                               Subsidiaries.  Phase II Mall Subsidiary is a wholly owned
Subsidiary of Phase II Mall Subsidiary Holding. 
The equity interests of Phase II Mall Subsidiary are duly authorized,
validly issued and (if applicable), fully paid and nonassessable and none of
such equity interests constitutes Margin Stock. 
Phase II Mall Subsidiary has no Subsidiaries.

 

(E)                                 Rights
to Acquire Equity.  There are no
options, warrants, convertible securities or other rights to acquire any equity
interests in any Borrower or any of their Subsidiaries except for the rights of
GGP under the Phase II Mall Sale Agreement and as otherwise set forth as Schedule 4.1E.

 

(F)                                 Conduct
of Business.  The Borrowers and their
Subsidiaries are engaged only in the businesses permitted to be engaged in
pursuant to subsection 6.11.

 

4.2                                 Authorization of Borrowing, etc.

 

(A)                              Authorization
of Documents.  The execution,
delivery and performance of the Loan Documents and the Project Documents have
been duly authorized by all necessary corporate action on the part of each of
the Borrowers that is a party thereto.

 

59

 

(B)                                No
Conflict.  The execution, delivery
and performance by the Borrowers of the Loan Documents, the Project Documents
and the Resort Complex Operative Documents to which they are parties and the
consummation of the transactions contemplated by the Loan Documents, the
Project Documents and the Resort Complex Operative Documents do not and will
not (i) violate any provision of (a) any Legal Requirement applicable to
the Borrowers or any of their Subsidiaries, (b) the operating agreements of the
Borrowers or any of their Subsidiaries or (c) any order, judgment or decree of
any Governmental Instrumentality binding on the Borrowers or any of their
Subsidiaries, (ii) conflict with, result in a breach of or constitute
(with due notice or lapse of time or both) a default under any Contractual
Obligation of the Borrowers or any of their Subsidiaries, (iii) result in
or require the creation or imposition of any Lien upon any of the properties or
assets of the Borrowers or any of their Subsidiaries (other than any Liens
created under any of the Loan Documents in favor of the Administrative Agent on
behalf of Lenders or which otherwise are Permitted Liens), or (iv) require
any approval of any Person under any Contractual Obligation of the Borrowers or
any of their Subsidiaries except for such approvals or consents which will be
obtained on or before the Closing Date and disclosed in writing to Lenders and
except for such violations, conflicts, approvals and consents the failure of
which to obtain would not reasonably be expected to have a Material Adverse
Effect.

 

(C)                                Governmental
Consents.  Other than as set forth on
Schedule 4.2C, the execution, delivery and performance by the Borrowers
of the Loan Documents to which they are parties and the consummation of the
transactions contemplated by the Loan Documents do not and will not require any
registration with, consent or approval of, or notice to, or other action to,
with or by, any Governmental Instrumentality.

 

(D)                               Binding
Obligation.  Each of the Loan
Documents, the Project Documents and the Resort Complex Operative Documents to
which either or both of the Borrowers are a party has been duly executed and
delivered by the Borrowers and are the legally valid and binding obligation of
the Borrowers, enforceable against them in accordance with its respective
terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors’ rights generally
or by equitable principles relating to enforceability, whether brought in a
proceeding in equity or at law.

 

4.3                                 Financial Condition.

 

The Borrowers have heretofore delivered to Lenders, at
Lenders’ request, the following financial statements and information:  (i) the audited consolidated and
consolidating balance sheets of LVSI and its Subsidiaries as at each of
December 31, 2001, December 31, 2002, and December 31, 2003, and the related
consolidated and consolidating statements of income, stockholders’ equity and
cash flows of LVSI, Venetian and their Subsidiaries for the Fiscal Year then
ended, (ii) the unaudited consolidated and consolidating balance sheets of LVSI
and its Subsidiaries as at March 31, 2004 and June 30, 2004, and the related
unaudited consolidated and consolidating statements of income, stockholders’
equity and cash flows of LVSI and its Subsidiaries for each such three-month
period then ended, (iii) the unaudited consolidated and consolidating balance
sheets of LVSI and its Subsidiaries (other than Excluded Subsidiaries) as at
June 30, 2004, and the related unaudited consolidated and consolidating
statements of income, stockholders’ equity and cash flows of LVSI and its
Subsidiaries (other than Excluded Subsidiaries) for the twelve months then
ended, giving pro forma effect to the Refinancing, the

 

60

 

Transactions and
the initial credit extensions (under the Bank Facilities Agreement) on the
Closing Date (under and as defined in the Bank Facilities Agreement) and (iv)
the unaudited consolidated and consolidating balance sheets of Phase II Mall
Subsidiary Holding and Phase II Mall Subsidiary as at June 30, 2004, and the
related unaudited consolidated and consolidating statements of income,
stockholders’ equity and cash flows of Phase II Mall Subsidiary Holding and
Phase II Mall Subsidiary.  All such
statements (other than pro forma statements) were prepared in conformity
with GAAP and fairly present, in all material respects, the financial position
(on a consolidated and, where applicable, consolidating basis) of the entities
described in such financial statements as at the respective dates thereof and
the results of operations and cash flows (on a consolidated and, where
applicable, consolidating basis) of the entities described therein for each of
the periods then ended, subject, in the case of any such unaudited financial
statements, to changes resulting from audit and normal year-end
adjustments.  As of the date hereof,
except for obligations under the Operative Documents and the Phase II Mall
Contribution Documents, the Borrowers do not (and will not following the
funding of the initial Loans) have any Contingent Obligation, contingent
liability or liability for taxes, long-term lease or forward or long-term
commitment that is not reflected in the foregoing financial statements or the
notes thereto and which in any such case is material in relation to the
business, operations, properties, assets, financial condition or prospects of
the Borrowers and their Subsidiaries taken as a whole.

 

4.4                                 No Material Adverse Change.

 

Since December 31, 2003, no event or change has
occurred that has caused or evidences, either in any case or in the aggregate,
a Material Adverse Effect.

 

4.5                                 Title to Properties; Liens; Real Property.

 

(A)                              Title
to Properties; Liens.  The Borrowers
and their Subsidiaries have (i) good marketable and insurable fee simple
title to (in the case of fee interests in real property), (ii) valid leasehold
interests in (in the case of leasehold interests in real or personal property)
and (iii) good title to (in the case of all other personal property), all
of their respective material properties and assets reflected in the financial
statements referred to in subsection 4.3 or in the most recent financial
statements delivered pursuant to subsection 5.1, in each case except for
assets disposed of since the date of such financial statements in the ordinary
course of business or as otherwise permitted under subsection 6.6.  Except as permitted by this Agreement, all
such properties and assets are held free and clear of Liens.

 

(B)                                Real
Property.  As of the Closing Date, Schedule 4.5
annexed hereto contains a true, accurate and complete list of (i) all
material real property owned by the Borrowers or any of their Subsidiaries and
(ii) all material leases, subleases or assignments of leases (together
with all amendments, modifications, supplements, renewals or extensions of any
thereof) affecting real estate properties owned by the Borrowers or any of
their Subsidiaries regardless of whether a Borrower or such Subsidiary is the
landlord, tenant or subtenant (whether directly or as an assignee or successor
in interest) under such lease, sublease or assignment.  As of the Closing Date, each agreement listed
in clause (ii) of the immediately preceding sentence is in full force and
effect and Borrowers do not have knowledge of any material default that has
occurred and is continuing thereunder, and each such agreement constitutes the
legally valid and binding

 

61

 

obligation
of each applicable Borrower, enforceable against such Borrower in accordance
with its terms, except as enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws relating to or limiting creditors’
rights generally or by equitable principles except to the extent that the
failure of such agreement to be in full force and effect could not reasonably
be expected to have a Material Adverse Effect.

 

4.6                                 Litigation; Adverse Facts.

 

Except as set forth in Schedule 4.6, there
are no actions, suits, proceedings, arbitrations or governmental investigations
(whether or not purportedly on behalf of the Borrowers or any of their
Subsidiaries) at law or in equity, or before or by any federal, state,
municipal or other governmental department, commission, board, bureau, agency
or instrumentality, domestic or foreign (including any Environmental Claims)
that are pending or, to the knowledge of the Borrowers, threatened against or
affecting Borrowers or any of their Subsidiaries or any property of the
Borrowers or any of their Subsidiaries and that, individually or in the
aggregate, could reasonably be expected to result in a Material Adverse
Effect.  Neither the Borrowers nor any of
their Subsidiaries (i) is in violation of any applicable laws (including
Environmental Laws) that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect or (ii) is subject to or
in default with respect to any final judgments, writs, injunctions, decrees,
rules or regulations of any court or any federal, state, municipal or other
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign, that, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect.

 

4.7                                 Payment of Taxes.

 

Except to the extent permitted by subsection 5.3,
all tax returns and reports of the Borrowers required to be filed by them have
been timely filed, and all taxes shown on such tax returns to be due and
payable and all material assessments, fees and other governmental charges upon
the Borrowers and upon their respective properties, assets, income, businesses
and franchises which are due and payable have been paid when due and
payable.  The Borrowers know of no
proposed tax assessment against the Borrowers or any of their Subsidiaries
which is not being actively contested by the Borrowers or such Subsidiary in
good faith and by appropriate proceedings; provided that such reserves
or other appropriate provisions, if any, as shall be required in conformity
with GAAP shall have been made or provided therefor.

 

4.8                                 Performance of Agreements; Materially
Adverse Agreements; Material Contracts.

 

(A)                              Neither
the Borrowers nor any of their Subsidiaries is in default in the performance,
observance or fulfillment of any of the obligations, covenants or conditions
contained in any of its Contractual Obligations, and no condition exists that,
with the giving of notice or the lapse of time or both, would constitute such a
default, except where the consequences of such default or defaults, if any,
would not reasonably be expected to have a Material Adverse Effect.

 

(B)                                Schedule
4.8 contains a true, correct and complete list of all the Material
Contracts in effect on the Closing Date. 
As of the Closing Date, all such Material Contracts are,

 

62

 

to
the knowledge of the Borrowers, in full force and effect and no material
defaults currently exist thereunder.

 

4.9                                 Governmental Regulation.

 

Neither the Borrowers nor any of their Subsidiaries is
subject to regulation under the Public Utility Holding Company Act of 1935, the
Federal Power Act, or the Interstate Commerce Act or registration under the
Investment Company Act of 1940 or under any other federal or state statute or
regulation which may limit its ability to incur Indebtedness other than the
Nevada Gaming Laws or which may otherwise render all or any portion of the
Obligations unenforceable.  Incurrence of
the Obligations under the Loan Documents complies with all applicable
provisions of the Nevada Gaming Laws.

 

(A)                              Securities
Activities.  Neither the Borrowers
nor any of their Subsidiaries is engaged principally, or as one of its
important activities, in the business of extending credit for the purpose of
purchasing or carrying any Margin Stock.

 

4.10                           Employee Benefit Plans.

 

(A)                              The
Borrowers, each of their Subsidiaries and each of their respective ERISA
Affiliates are in material compliance with all applicable provisions and
requirements of ERISA and the regulations thereunder with respect to each
Employee Benefit Plan, and have performed all their obligations under each
Employee Benefit Plan.  Each Employee
Benefit Plan which is intended to qualify under Section 401(a) of the Code is
so qualified.

 

(B)                                No
ERISA Event has occurred or is reasonably expected to occur which has resulted
or would be reasonably likely to result in a liability in the aggregate amount
of $1,000,000 or more.

 

(C)                                Except
to the extent required under Section 4980B of the Code, no Employee Benefit
Plan provides health or welfare benefits (through the purchase of insurance or
otherwise) for any retired or former employee of the Borrowers, any of their
Subsidiaries or any of their respective ERISA Affiliates.

 

(D)                               As
of the most recent valuation date for any Pension Plan, the amount of unfunded
benefit liabilities (as defined in Section 4001(a)(18) of ERISA), individually
or in the aggregate for all Pension Plans (excluding for purposes of such
computation any Pension Plans with respect to which assets exceed benefit
liabilities), does not exceed $1,000,000.

 

(E)                                 As
of the most recent valuation date for each Multiemployer Plan for which the
actuarial report is available, the potential liability of the Borrowers, their
Subsidiaries and their respective ERISA Affiliates for a complete withdrawal
from such Multiemployer Plan (within the meaning of Section 4203 of ERISA),
when aggregated with such potential liability for a complete withdrawal from
all Multiemployer Plans, based on information available pursuant to Section
4221(e) of ERISA, does not exceed $5,000,000.

 

63

 

4.11                           Certain Fees.

 

No broker’s or finder’s fee or commission will be
payable with respect to this Agreement or any of the transactions contemplated
hereby (other than fees payable to Agents and Lenders under subsection 2.3),
and each Borrower hereby indemnifies the Lenders against, and agrees that it
will hold the Lenders harmless from, any claim, demand or liability for any
such broker’s or finder’s fees alleged to have been incurred in connection
herewith or therewith and any expenses (including reasonable fees, expenses and
disbursements of counsel) arising in connection with any such claim, demand or
liability.

 

4.12                           Environmental Protection.

 

Except as set forth in Schedule 4.12
annexed hereto or as could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect:

 

(i)                     neither
the Borrowers nor any of their Subsidiaries nor any of their respective
Facilities or operations relating to the Phase II Project, the Site or the
Resort Complex are subject to any outstanding written order, consent decree or
settlement agreement with any Person relating to (a) any Environmental
Law, (b) any Environmental Claim, or (c) any Hazardous Materials Activity;

 

(ii)                  neither
the Borrowers nor any of their Subsidiaries has received any letter or
request for information under Section 104 of the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9604)
or any comparable state law;

 

(iii)               there
are, and to the Borrowers’ knowledge, have been, no conditions, occurrences, or
Hazardous Materials Activities on any of the Facilities which could reasonably
be expected to form the basis of an Environmental Claim against the Borrowers
or any of their Subsidiaries;

 

(iv)              neither
the Borrowers nor any of their Subsidiaries nor, to the Borrowers’ knowledge,
any predecessor of the Borrowers or any of their Subsidiaries has filed any
notice under any Environmental Law indicating past or present treatment of
Hazardous Materials at any Facility, and none of the Borrowers’ or any of their
Subsidiaries’ operations involves the generation, transportation, treatment,
storage or disposal of hazardous waste, as defined under 40 C.F.R. Parts
260-270 or any state equivalent; and

 

(v)                 compliance
with all current or reasonably foreseeable future requirements pursuant to or
under Environmental Laws will not, individually or in the aggregate, have a
reasonable possibility of giving rise to a Material Adverse Effect.

 

Notwithstanding anything in this subsection 4.12
to the contrary, no event or condition has occurred or is occurring with
respect to the Borrowers or any of their Subsidiaries relating to any
Environmental Law, any Release of Hazardous Materials, or any Hazardous
Materials Activity, including any matter disclosed on Schedule 4.12
annexed hereto, which individually or in the aggregate has had or could
reasonably be expected to have a Material Adverse Effect.

 

64

 

4.13                           Employee Matters.

 

There is no strike or work stoppage in existence or
threatened involving the Borrowers or their Subsidiaries that could reasonably
be expected to have a Material Adverse Effect.

 

4.14                           Solvency.

 

Each of the Borrowers is and, upon the incurrence of
the Phase II Mall Contribution and the Obligations by such Borrower on any date
on which this representation is made, will be, Solvent.

 

4.15                           Matters Relating to Collateral.

 

(A)                              Creation,
Perfection and Priority of Liens. 
The execution and delivery of the Collateral Documents by the Borrowers,
together with the actions taken on or prior to the Closing Date pursuant to subsection
3.1 are effective to create in favor of the Administrative Agent for the
benefit of the Secured Parties, as security for the Obligations, subject to the
exceptions contained in the Security Agreement, a valid and perfected First
Priority Lien on all of the Collateral, and all filings and other actions
necessary to perfect and maintain the perfection and priority status of such
Liens have been duly made or taken and remain full force and effect, other than
the filing of any UCC financing statements delivered to the Administrative
Agent for filing (but not yet filed), the recording of the Deed of Trust
delivered to the Title Company for recording (but not yet recorded, and in
connection with which a title commitment has been issued by the Title Company
on the Closing Date) and the periodic filing of UCC continuation statements in
respect of UCC financing statements filed by or on behalf of the Administrative
Agent.  As of the Closing Date, no
filing, recordation, re-filing or re-recording other than those listed on
Schedule 4.2C is necessary to perfect and maintain the perfection of the
interest, title or Liens of the Collateral Documents.

 

(B)                                Permits.  No authorization, approval or other action
by, and no notice to or filing with, any Governmental Instrumentality is
required for either (i) the pledge or grant by the Borrowers of the Liens
purported to be created in favor of the Administrative Agent pursuant to any of
the Collateral Documents or (ii) the exercise by the Administrative Agent
of any rights or remedies in respect of any Collateral (whether specifically
granted or created pursuant to any of the Collateral Documents or created or
provided for by applicable law), except for filings or recordings contemplated
by subsection 4.15A or as set forth in Schedule 4.15B.

 

(C)                                Absence
of Third-Party Filings.  Except such
as may have been filed in favor of the Administrative Agent as contemplated by subsection 4.15A
or filed to perfect a Permitted Lien, no effective UCC financing statement,
fixture filing or other instrument similar in effect covering all or any part
of the Collateral is on file in any filing or recording office.

 

(D)                               Information
Regarding Collateral.  All
information supplied to the Administrative Agent and/or the Disbursement Agent
by or on behalf of the Borrowers with respect to any of the Collateral (in each
case taken as a whole with respect to any particular Collateral) is accurate
and complete in all material respects.

 

4.16                           Construction Litigation.  The litigation arising out of the lawsuit
filed by LVSI and Venetian against Bovis in the United States District Court
for the District of Nevada and the countersuit filed by Bovis against LVSI and
Venetian and any other outstanding lawsuit, action,

 

65

 

claim
or Lien arising out of or relating to the construction of the Existing Facility
(the “Construction Litigation”), including any claim made or Lien filed
by Bovis or any contractor or subcontractor or to the bonding company insuring
over any Lien relating to or binding upon the Existing Facility or to Venetian,
LVSI, or any of their Affiliates in connection therewith, and any judgment or
settlement amount owed by the Borrowers to Bovis or any contractor or
subcontractor or to the bonding company insuring over any such Lien as a result
of the Construction Litigation (such amount, the “Additional Contingent Claims”) cannot reasonably be expected
to have, when taken in the aggregate, a Material Adverse Effect.

 

4.17                           Accuracy of Information.

 

None of the factual information (other than
projections and pro  forma financial information as to which no
representation is made under this subsection), taken as a whole, furnished by
or on behalf of the Borrowers or any of the Bank Loan Parties in writing to the
Arranger, the Administrative Agent or any Lender for inclusion in the
confidential information memorandum delivered to the Lenders contains any
untrue statement of a material fact or omitted to state any material fact
necessary to make such information, taken as a whole, not misleading.

 

4.18                           Compliance with Laws.  The Borrowers and all other Persons on or
occupying any Facilities are in compliance with the requirements of all
applicable laws, rules, regulations and orders of any Governmental
Instrumentality (including all Environmental Laws), other than such laws,
rules, regulations and orders, the noncompliance with which could not
reasonably be expected to cause, individually or in the aggregate, a Material
Adverse Effect.

 

5.                                       Borrowers’ Affirmative Covenants.

 

The Borrowers covenant and agree with each Lender and
each Agent that, until the Termination Date, the Borrowers shall perform all
covenants set forth in this Section 5.

 

5.1                                 Financial Statements and Other
Reports.

 

The Borrowers will maintain a system of accounting
established and administered in accordance with sound business practices to
permit preparation of financial statements in conformity with GAAP.  The Borrowers will deliver to the
Administrative Agent (which will promptly deliver to the Lenders):

 

(i)                     Monthly
Financials:  as soon as available and
in any event within 30 days after the end of each month, (A) the consolidated
and consolidating balance sheets of LVSI and its Subsidiaries as at the end of
such month and the related consolidated and consolidating statements of income,
stockholders’ equity and cash flows of LVSI and its Subsidiaries for such month
and for the period from the beginning of the then current Fiscal Year to the
end of such month, setting forth in each case in comparative form the
corresponding figures for the corresponding periods of the previous Fiscal
Year, to the extent prepared on a monthly basis, all in reasonable detail and
certified by the chief financial officer of LVSI, on behalf of LVSI, that they
fairly present, in all material respects, the financial condition of LVSI and
its Subsidiaries as at the dates indicated and the results of their operations
and their cash

 

66

 

flows for the
periods indicated, subject to changes resulting from audit and normal year-end
adjustments and (B) the consolidated and consolidating balance sheets of Phase
II Mall Subsidiary Holding and Phase II Mall Subsidiary as at the end of such
month and the related consolidated and consolidating statements of income,
stockholders’ equity and cash flows of Phase II Mall Subsidiary Holding and
Phase II Mall Subsidiary for such month and for the period from the beginning
of the then current Fiscal Year to the end of such month, setting forth in each
case in comparative form the corresponding figures for the corresponding
periods of the previous Fiscal Year, to the extent prepared on a monthly basis,
all in reasonable detail and certified by the chief financial officer of LVSI,
on behalf of LVSI, Phase II Mall Subsidiary Holding and Phase II Mall
Subsidiary, as applicable, that they fairly present, in all material respects,
the financial condition of LVSI and its Subsidiaries and Phase II Mall
Subsidiary Holdings and Phase II Mall Subsidiary, as applicable, as at the
dates indicated and the results of their operations and their cash flows for
the periods indicated, subject to changes resulting from audit and normal
year-end adjustments

 

(ii)                  Quarterly
Financials:  as soon as available and
in any event within 45 days after the end of each Fiscal Quarter,

 

(a)                                  the
consolidated and consolidating balance sheets of LVSI and its Subsidiaries as
at the end of such Fiscal Quarter and the related consolidated and
consolidating statements of income, stockholders’ equity and cash flows of LVSI
and its Subsidiaries for such Fiscal Quarter and for the period from the
beginning of the then current Fiscal Year to the end of such Fiscal Quarter),
setting forth in each case in comparative form the corresponding figures for
the corresponding periods of the previous Fiscal Year, all in reasonable detail
and certified by the chief financial officer of LVSI, on behalf of LVSI, that they
fairly present, in all material respects, the financial condition of LVSI and
its Subsidiaries as at the dates indicated and the results of their operations
and their cash flows for the periods indicated, subject to changes resulting
from audit and normal year-end adjustments;

 

(b)                                 the
consolidated balance sheets of LVSI and its Restricted Subsidiaries as at the
end of such Fiscal Quarter and the related consolidated statements of income,
stockholders’ equity and cash flows of LVSI and its Restricted Subsidiaries for
such Fiscal Quarter and for the period from the beginning of the then current
Fiscal Year to the end of such Fiscal Quarter, setting forth in each case in
comparative form the corresponding figures for the corresponding periods of the
previous Fiscal Year and the corresponding figures from the Financial Plan for
the current Fiscal Year, all in reasonable detail and certified by the chief
financial officer of LVSI, on behalf of LVSI, that they fairly present, in all
material respects, the financial condition of LVSI and its Restricted
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated, subject to changes resulting from
audit and normal year-end adjustments; and

 

(c)                                  the
consolidated and consolidating balance sheets of Phase II Mall Subsidiary
Holding and Phase II Mall Subsidiary as at the end of such Fiscal Quarter and
the related consolidated and consolidating statements of income, stockholders’
equity and

 

67

 

cash flows of
Phase II Mall Subsidiary Holding and Phase II Mall Subsidiary for such Fiscal
Quarter and for the period from the beginning of the then current Fiscal Year
to the end of such Fiscal Quarter), setting forth in each case in comparative
form the corresponding figures for the corresponding periods of the previous
Fiscal Year (if applicable), all in reasonable detail and certified by the
chief financial officer of LVSI, on behalf of Phase II Mall Subsidiary Holding
and Phase II Mall Subsidiary that they fairly present, in all material
respects, the financial condition of Phase II Mall Subsidiary Holding and Phase
II Mall Subsidiary as at the dates indicated and the results of their
operations and their cash flows for the periods indicated, subject to changes
resulting from audit and normal year-end adjustments.

 

(iii)               Year-End
Financials:  as soon as available and
in any event within 90 days after the end of each Fiscal Year,

 

(a)                                  the
consolidated and consolidating balance sheets of LVSI and its Subsidiaries as
at the end of such Fiscal Year and the related consolidated and consolidating
statements of income, stockholders’ equity and cash flows of LVSI and its
Subsidiaries for such Fiscal Year, setting forth in each case in comparative
form the corresponding figures for the previous Fiscal Year, all in reasonable
detail and certified by the chief financial officer of LVSI, on behalf of LVSI,
that they fairly present, in all material respects, the financial condition of
LVSI and its Subsidiaries as at the dates indicated and the results of their
operations and their cash flows for the periods indicated;

 

(b)                                 the
consolidated balance sheets of LVSI and its Restricted Subsidiaries as at the
end of such Fiscal Year and the related consolidated and consolidating
statements of income, stockholders’ equity and cash flows of LVSI and its
Restricted Subsidiaries for such Fiscal Year, setting forth in each case in
comparative form the corresponding figures for the previous Fiscal Year and the
corresponding figures from the Financial Plan for the Fiscal Year covered by
such financial statements, all in reasonable detail and certified by the chief
financial officer of LVSI, on behalf of LVSI, that they fairly present, in all
material respects, the financial condition of LVSI and its Restricted
Subsidiaries as at the dates indicated and the results of their operations and
their cash flows for the periods indicated;

 

(c)                                  the
consolidated and consolidating balance sheets of Phase II Mall Subsidiary
Holding and Phase II Mall Subsidiary as at the end of such Fiscal Year and the
related consolidated and consolidating statements of income, stockholders’
equity and cash flows of Phase II Mall Subsidiary Holding and Phase II Mall
Subsidiary for such Fiscal Year, setting forth in each case in comparative form
the corresponding figures for the previous Fiscal Year, all in reasonable
detail and certified by the chief financial officer of LVSI, on behalf of Phase
II Mall Subsidiary Holding and Phase II Mall Subsidiary that they fairly
present, in all material respects, the financial condition of Phase II Mall
Subsidiary Holding and Phase II Mall Subsidiary as at the dates indicated and
the results of their operations and their cash flows for the periods indicated;
and

 

(d)                                 in
the case of such consolidated financial statements specified in clause (a)
above, a report thereon of PriceWaterhouseCoopers or other independent
certified public

 

68

 

accountants of
recognized national standing selected by LVSI and the Borrowers and reasonably
satisfactory to the Administrative Agent, which report shall be unqualified as
to scope of audit, shall express no doubts about the ability of the Persons
covered thereby to continue as a going concern, and shall state that such
consolidated financial statements fairly present, in all material respects, the
consolidated financial position of LVSI and its Subsidiaries as at the dates
indicated and the results of their operations and their cash flows for the
periods indicated in conformity with GAAP applied on a basis consistent with
prior years (except as otherwise disclosed in such financial statements) and
that the examination by such accountants in connection with such consolidated
financial statements has been made in accordance with generally accepted
auditing standards;

 

(iv)              Officers’
Certificates:  as soon as available
and in any event within 45 days after the end of each Fiscal Quarter, an
Officers’ Certificate of each of the Borrowers stating that the signers, on
behalf of the Borrowers, have reviewed the terms of this Agreement and have
made, or caused to be made under their supervision, a review in reasonable
detail of the transactions and condition of the Borrowers and its Subsidiaries
during the previous Fiscal Quarter and that such review has not disclosed the
existence during or at the end of such Fiscal Quarter, and that the signers do
not have knowledge of the existence as at the date of such Officers’
Certificate, of any condition or event that constitutes an Event of Default or
Potential Event of Default, or, if any such condition or event existed or
exists, specifying the nature and period of existence thereof and what action
the Borrower has taken, is taking and proposes to take with respect thereto;

 

(v)                 SEC
Filings, Press Releases and Other Financial Reports:  promptly upon their becoming available,
copies of (a) all financial statements, reports, notices and proxy
statements sent or made available generally by LVSI, Venetian or any of their
Subsidiaries to their security holders, (b) all regular and periodic
reports and all registration statements (other than on Form S-8 or a similar
form) and prospectuses, if any, filed by LVSI, Venetian or any of their Subsidiaries
with any securities exchange or with the Securities and Exchange Commission or
any Governmental Instrumentality, (c) all press releases and other statements
made available generally by LVSI, Venetian and any of their Restricted
Subsidiaries to the public concerning material developments in the business of
LVSI, Venetian and their Subsidiaries and (d) to the extent prepared, any
financial statements and reports concerning any Subsidiaries of LVSI and
Venetian not delivered pursuant to clauses (i), (ii) or (iii)
above;

 

(vi)              Events
of Default, etc.:  promptly upon any
officer of the Borrowers obtaining knowledge (a) of any condition or event that
constitutes an Event of Default or Potential Event of Default, or becoming
aware that any Lender has given any notice (other than to the Administrative
Agent) or taken any other action with respect to a claimed Event of Default or
Potential Event of Default, (b) that any Person has given any notice to
the Borrowers or taken any other action with respect to a claimed default or
event or condition of the type referred to in subsection 7.2, (c) of any
condition or event that would be required to be disclosed in a current report
filed with the Securities and Exchange Commission on Form 8-K (Items 1, 2,
4, 5 and 6 of such Form as in

 

69

 

effect on the
Closing Date) if the Borrowers were required to file such reports under the
Exchange Act, or (d) of the occurrence of any event or change that has caused
or evidences, either in any case or in the aggregate, a Material Adverse
Effect, an Officers’ Certificate specifying the nature and period of existence
of such condition, event or change, or specifying the notice given or action
taken by any such Person and the nature of such claimed Event of Default,
Potential Event of Default, default, event or condition, and what action
Borrowers have taken, are taking and propose to take with respect thereto;

 

(vii)           Litigation
or Other Proceedings:  (a) promptly
upon any officer of the Borrowers obtaining knowledge of (X) the non-frivolous
institution of, or threat of, any action, suit, proceeding (whether
administrative, judicial or otherwise), governmental investigation or
arbitration against or affecting the Borrowers and their Subsidiaries, or any
property of the Borrowers and their Subsidiaries (collectively, “Proceedings”) not previously disclosed in
writing by the Borrowers to Lenders or (Y) any material development in any
Proceeding that, in any case:

 

(1)                                  has
a reasonable possibility of giving rise to a Material Adverse Effect; or

 

(2)                                  seeks
to enjoin or otherwise prevent the consummation of, or to recover any damages
or obtain relief as a result of, the transactions contemplated hereby;

 

written notice thereof
together with such other information as may be reasonably available to the
Borrowers to enable Lenders and their counsel to evaluate such matters; and
(b) within twenty days after the end of each Fiscal Quarter, a schedule of
all Proceedings involving an alleged liability of, or claims against or
affecting, the Borrowers or any of their Subsidiaries equal to or greater than
$5,000,000, and promptly after request by the Administrative Agent such other
information as may be reasonably requested by the Administrative Agent to enable
Administrative Agent and its counsel to evaluate any of such Proceedings;

 

(viii)        ERISA
Events:  promptly upon becoming aware
of the occurrence of or forthcoming occurrence of any ERISA Event, a written
notice specifying the nature thereof, what action Borrowers or any of their
respective ERISA Affiliates has taken, is taking or proposes to take with
respect thereto and, when known, any action taken or threatened by the Internal
Revenue Service, the Department of Labor or the PBGC with respect thereto;

 

(ix)                ERISA
Notices:  with reasonable promptness,
copies of (a) each Schedule B (Actuarial Information) to the annual report
(Form 5500 Series) filed by the Borrowers, any of their Subsidiaries or any of
their respective ERISA Affiliates with the Internal Revenue Service with
respect to each Pension Plan; (b) all notices received by the Borrowers or any
of their respective ERISA Affiliates from a Multiemployer Plan sponsor
concerning an ERISA Event; and (c) copies of such other

 

70

 

documents or
governmental reports or filings relating to any Employee Benefit Plan as
Administrative Agent shall reasonably request;

 

(x)                   Insurance:  as soon as practicable and in any event by
the last day of each Fiscal Year, a report in form and substance reasonably
satisfactory to the Administrative Agent outlining all material insurance
coverage maintained as of the date of such report by the Borrowers and all
material insurance coverage planned to be maintained by the Borrowers in the
immediately succeeding Fiscal Year;

 

(xi)                Board
of Directors:  with reasonable
promptness, written notice of any change in the members of the Board of
Directors of the Borrower;

 

(xii)             New
Subsidiaries:  promptly upon any
Person becoming a Subsidiary of either of the Borrowers, a written notice
setting forth with respect to such Person (a) the date on which such Person
became a Subsidiary of either of the Borrowers and (b) all of the data required
to be set forth in Schedule 4.1D with respect to all Subsidiaries of
either of the Borrowers;

 

(xiii)          Material
Contracts:  promptly, and in any
event within ten Business Days after any Material Contract of the Borrowers or
any of their Subsidiaries is terminated or amended in a manner that is
materially adverse to the Borrowers or any of their Subsidiaries or any new
Material Contract is entered into, or upon becoming aware of any material
default by any party under a Material Contract, a written statement describing
such event with copies of such material amendments or new contracts, and an
explanation of any actions being taken with respect thereto;

 

(xiv)         UCC
Search Report:  As promptly as
practicable after the date of delivery to the Administrative Agent of any UCC
financing statement delivered by any future Subsidiary pursuant to subsection 5.11,
copies of completed UCC searches evidencing the proper filing, recording and
indexing of all such UCC financing statements and listing all other effective
financing statements that name such Subsidiary as debtor, together with copies
of all such other financing statements not previously delivered to the
Administrative Agent by or on behalf of such Subsidiary;

 

(xv)            Exception
Reports:  promptly upon receipt,
copies of all exception reports provided to LVSI and/or Venetian by the Nevada
Gaming Authorities and the equivalent authorities in Macau or any other
relevant jurisdiction; and

 

(xvi)         Other
Information:  with reasonable
promptness, such other information and data with respect to the Borrowers or
any of their Subsidiaries as from time to time may otherwise be reasonably
requested by the Administrative Agent or any Lender.

 

5.2                                 Corporate
Existence, etc.

 

The Borrowers will, and will cause each of their
Subsidiaries to, at all times preserve and keep in full force and effect their
corporate or limited liability company existence and all rights and franchises
material to its business; provided, however, that the Borrowers
and their Subsidiaries may merge or consolidate as permitted pursuant to subsection
6.6 of this Agreement

 

71

 

and provided,
further, that no Borrower nor any such Subsidiary shall be required to
preserve any such right or franchise if the Board of Directors of the
applicable Borrower or Subsidiary (or the managing member thereof, if
applicable) shall determine (and shall so notify the Administrative Agent),
that the preservation thereof is no longer desirable in the conduct of the
business of such Borrower or Subsidiary, as the case may be, and that the loss
thereof is not disadvantageous in any material respect to the Borrowers and
their Subsidiaries or the Lenders.

 

5.3                                 Payment of Taxes and Claims; Tax
Consolidation.

 

(A)                              The
Borrowers will, and will cause each of their Subsidiaries to, pay all material
Taxes, assessments and other governmental charges imposed upon it or any of its
properties or assets or in respect of any of its income, businesses or
franchises before any penalty accrues thereon, and all material claims
(including claims for labor, services, materials and supplies) for sums that
have become due and payable and that by law have or may become a Lien upon any
of its properties or assets, prior to the time when any penalty or fine shall
be incurred with respect thereto; provided that no such charge or claim
need be paid if it is being contested in good faith by appropriate proceedings
promptly instituted and diligently conducted, so long as (1) (a) the amount
required in order to pay such charge or claim is included in the Project Budget
as a Line Item and (b) the Borrowers are in compliance with Section 5.5 of the
Disbursement Agreement and (2) in the case of a charge or claim which has or
may become a Lien against any of the Collateral, such contest proceedings
conclusively operate to stay the sale of any portion of the Collateral to
satisfy such charge or claim and the Borrowers have demonstrated to the
Administrative Agent in its sole determination that such Lien can and will be
removed prior to the anticipated Phase II Mall Release Date.

 

(B)                                The
Borrowers will not, nor will they permit any of their Subsidiaries to, file or
consent to the filing of any consolidated income tax return with any Person
(other than LVSI, Venetian or any of their Subsidiaries) unless the Borrowers
and their Subsidiaries shall have entered into, a tax sharing agreement with
such Person, in form and substance satisfactory to the Administrative Agent.

 

(C)                                If
and to the extent that LVSI, Venetian or any Restricted Subsidiary makes a
payment or distribution to any direct or indirect shareholder or member other
than LVSI, Venetian or any Restricted Subsidiary with respect to Taxes that are
attributable to the income of either of the Borrowers or any of their
Subsidiaries (including in connection with the Phase II Mall Sale) (“Phase II Mall Borrower Taxes”), then the
Borrowers shall be entitled to reimburse LVSI, Venetian or such Restricted
Subsidiary for such Phase II Mall Borrower Taxes.

 

5.4                                 Maintenance of Properties; Insurance;
Application of Net Loss Proceeds.

 

(A)                              Maintenance
of Properties.  The Borrowers will,
and will cause each of their Subsidiaries to, maintain or cause to be
maintained in good repair, working order and condition, ordinary wear and tear
excepted, all material properties used or useful in the business of the
Borrowers and their Subsidiaries and from time to time will make or cause to be
made all appropriate repairs, renewals and replacements thereof except to the
extent that the Borrowers determine in good faith not to maintain, repair,
renew or replace such property if such property is no longer desirable in the
conduct of their business and the failure to do so is not

 

72

 

disadvantageous
in any material respect to the Borrowers and their Subsidiaries or the
Lenders.  Upon Substantial Completion,
the Borrowers will operate the Phase II Mall at standards of operation at least
equivalent to the standards of operation of the shopping mall in the Existing
Facility on the Closing Date.

 

(B)                                Insurance.  The Borrowers will maintain or cause to be
maintained, with financially sound and reputable insurers, such public
liability insurance, third party property damage insurance, business
interruption insurance and casualty insurance with respect to liabilities, losses
or damage in respect of the assets, properties and businesses of the Borrowers
and their Subsidiaries as may from time to time customarily be carried or
maintained under similar circumstances by entities of established reputation
engaged in similar businesses, in each case in such amounts (giving effect to
self-insurance), with such deductibles, covering such risks and otherwise on
such terms and conditions as shall be customary for entities similarly situated
in the industry; provided, however, that the insurance coverage
(including the types, terms, conditions, amounts and deductibles) described in Exhibit
K (or the Cooperation Agreement after the amendment thereof contemplated by
Section 3.4.3 of the Disbursement Agreement) shall be deemed satisfactory to
fulfill the requirements of this sentence; and further provided, however,
the Borrowers may be insured under policies obtained by LCR for the Phase II
Project.  The Borrowers will maintain or
cause to be maintained (or insured under policies obtained by LCR for the Phase
II Project) with regard to the Phase II Mall prior to the amendment to the
Cooperation Agreement contemplated by Section 3.4.3 of the Disbursement
Agreement, the insurance coverages set forth on Exhibit K and, after
such amendment to the Cooperation Agreement, the insurance coverage required to
be maintained under the Cooperation Agreement, such insurance coverage to be
provided by such insurance provider, in such amounts with such deductibles and
covering such risks as are at all times required under the Cooperation
Agreement and to include, if the Mortgaged Property is located in an area
designated by the Federal Emergency Management Agency as having special flood
or mud slide hazards, flood insurance in compliance with any applicable
regulations of the Board of Governors of the Federal Reserve System; provided
that, notwithstanding the provisions of the Cooperation Agreement, the
Borrowers will use commercially reasonable efforts to acquire and maintain or
cause to be maintained (or to be insured under policies obtained by LCR for the
Phase II Project), to the extent available at commercially reasonable rates,
after the amendment to the Cooperation Agreement, excess liability insurance
that specifically does not exclude terrorism for losses that exceed $45,000,000
per event at the Phase II Project (it being understood that neither the
Borrowers nor LCR have, and are not required to have, such insurance on the
Closing Date).  Notwithstanding anything
to the contrary contained herein, the parties agree that the insurance
requirements with respect to each of the Existing Facility and the Phase II
Project in the aforementioned amendment to the Cooperation Agreement will be
substantially similar to those set forth for the Existing Facility in the
Cooperation Agreement as of the date hereof.

 

(C)                                Application
of Net Loss Proceeds.  The Borrowers
shall (i) subject to the terms of the Disbursement Agreement, apply Net Loss
Proceeds to restore, replace or rebuild the Phase II Mall in accordance with
the Cooperation Agreement and (ii) apply any Net Loss Proceeds not applied as
provided in clause (i) to prepay the Loans in accordance with subsection
2.4A(iii) hereof.  The Administrative
Agent shall, and Borrowers hereby authorize Administrative Agent to, apply such
Net Loss Proceeds to prepay the Loans as provided in subsection 2.4A(iii).

 

73

 

5.5                                 Inspection; Lender Meeting.

 

(A)                              Inspection
Rights.  The Borrowers shall, and
shall cause each of their Subsidiaries to, permit any authorized representative
designated by any Lender to visit and inspect any of the properties of the
Borrowers and their Subsidiaries, to inspect, copy and take extracts from its
and their financial and accounting records, and to discuss its and their
affairs, finances and accounts with its and their officers and independent
public accountants, if requested by the Administrative Agent (provided that any
designated representatives of the Borrowers may, if they so choose, be present at
or participate in any such discussion), all upon reasonable notice and at such
reasonable times during normal business hours and as often as may reasonably be
requested.

 

(B)                                Lender
Meeting.  The Borrowers will, upon
the request of the Administrative Agent or Requisite Lenders, participate in a
meeting of the Administrative Agent and the Lenders once during each Fiscal
Year to be held at Borrowers’ corporate offices (or at such other location as
may be agreed to by the Borrowers and the Administrative Agent) at such time as
may be agreed to by the Borrowers and the Administrative Agent.

 

5.6                                 Compliance with Laws, etc.; Permits.

 

(A)                              The
Borrowers shall and shall cause each of their Subsidiaries and all other
Persons on or occupying any Facilities to, comply with the requirements of all
applicable laws, rules, regulations and orders of any Governmental
Instrumentality (including all Environmental Laws), noncompliance with which
could reasonably be expected to cause, individually or in the aggregate, a
Material Adverse Effect.

 

(B)                                The
Borrowers shall, and shall cause each of their Subsidiaries to, from time to
time obtain, maintain, retain, observe, keep in full force and effect and
comply in all material respects with the terms, conditions and provisions of all
Permits as shall now or hereafter be necessary under applicable laws except any
thereof the noncompliance with which could not reasonably be expected to have a
Material Adverse Effect.

 

(C)                                If
required under applicable securities laws, the Borrowers will promptly, and, if
so required, in any event within 20 days following the Closing Date, file this
Agreement with the Securities and Exchange Commission in accordance with
applicable securities laws and the Borrowers will file all amendments hereto
and waivers hereof with the Borrowers’ periodic securities filings.

 

5.7                                 Environmental Covenant.

 

(A)                              Environmental
Review and Investigation.  The
Borrowers agree that the Administrative Agent may, from time to time and in its
reasonable discretion, (i) retain, at Borrowers’ expense, an independent
professional consultant to review any environmental audits, investigations,
analyses and reports relating to Hazardous Materials in respect of the Site and
the Phase II Project prepared by or for Borrowers and (ii) conduct their
own investigation of any Facility; provided that, in the case of any
Facility no longer owned, leased, operated or used by the Borrowers or any of
their Subsidiaries, the Borrowers shall only be obligated to use their best
efforts to obtain permission for the Administrative Agent’s professional
consultant to conduct an investigation of such Facility.  For purposes of conducting such a review
and/or investigation,

 

74

 

the
Borrowers hereby grant to the Administrative Agent and their respective agents,
employees, consultants and contractors the right to enter into or onto any
Facilities currently owned, leased, operated or used by the Borrowers or any of
their Subsidiaries and to perform such tests on such property (including taking
samples of soil, groundwater and suspected asbestos-containing materials) as
are reasonably necessary in connection therewith.  Any such investigation of any Facility shall
be conducted, unless otherwise agreed to by the Borrowers or the Administrative
Agent, during normal business hours and, to the extent reasonably practicable,
shall be conducted so as not to interfere with the ongoing operations at such
Facility or to cause any damage or loss to any property at such Facility.  The Borrowers and the Administrative Agent
hereby acknowledge and agree that any report of any investigation conducted at
the request of the Administrative Agent pursuant to this subsection 5.7A
will be obtained and shall be used by the Administrative Agent and Lenders for
the purposes of Lenders’ internal credit decisions, to monitor and police the
Loans and to protect Lenders’ security interests created by the Loan
Documents.  The Administrative Agent
agrees to deliver a copy of any such report to the Borrowers with the
understanding that the Borrowers acknowledge and agree that (x) they will
indemnify and hold harmless the Administrative Agent and each Lender from any
costs, losses or liabilities relating to the Borrowers’ use of or reliance on
such report, (y) neither the Administrative Agent nor any Lender makes any
representation or warranty with respect to such report, and (z) by delivering
such report to the Borrowers, neither the Administrative Agent nor any Lender
is requiring or recommending the implementation of any suggestions or
recommendations contained in such report.

 

(B)                                Environmental
Disclosure.  The Borrowers will
deliver to the Administrative Agent and Lenders:

 

(i)                     Environmental
Audits and Reports.  As soon as
practicable following receipt thereof, copies of all environmental audits,
investigations, analyses and reports of any kind or character, whether prepared
by personnel of the Borrowers or any of their Subsidiaries or by independent
consultants, Governmental Instrumentalities or any other Persons, with respect
to significant environmental matters at any Facility or with respect to any
Environmental Claims;

 

(ii)                  Notice
of Certain Releases, Remedial Actions, Etc. 
Promptly upon the occurrence thereof, written notice describing in reasonable
detail (a) any Release required to be reported to any federal, state or local
governmental or regulatory agency under any applicable Environmental Laws,
(b) any remedial action taken by the Borrowers or any other Person in
response to (1) any Hazardous Materials Activities the existence of which
has a reasonable possibility of resulting in one or more Environmental Claims
having, individually or in the aggregate, a Material Adverse Effect or
(2) any Environmental Claims that, individually or in the aggregate, have
a reasonable possibility of resulting in a Material Adverse Effect.

 

(iii)               Written
Communications Regarding Environmental Claims, Releases, Etc.  As soon as practicable following the sending
or receipt thereof by the Borrowers or any of their Subsidiaries, a copy of any
and all written communications with respect to (a) any Environmental Claims
that, individually or in the aggregate, have a reasonable possibility of giving
rise to a Material Adverse Effect, (b) any Release

 

75

 

required to be
reported to any federal, state or local governmental or regulatory agency, and
(c) any request for information from any governmental agency that suggests
such agency is investigating whether Borrowers or any of their Subsidiaries may
be potentially responsible for any Hazardous Materials Activity.

 

(iv)              Notice
of Certain Proposed Actions Having Environmental Impact.  Prompt written notice describing in
reasonable detail (a) any proposed acquisition of stock, assets, or
property by the Borrowers or any of their Subsidiaries that could reasonably be
expected to (1) expose Borrowers or any of their Subsidiaries to, or result in,
Environmental Claims that could reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect or (2) affect the ability of the
Borrowers or any of their Subsidiaries to maintain full force and effect all
material Permits required under any Environmental Laws for their respective
operations and (b) any proposed action to be taken by the Borrowers or any
of their Subsidiaries to modify current operations in a manner that could
reasonably be expected to subject the Borrowers or any of their Subsidiaries to
any material additional obligations or requirements under any Environmental
Laws that could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect.

 

(v)                 Other
Information.  With reasonable
promptness, such other documents and information as from time to time may be
reasonably requested by the Administrative Agent in relation to any matters
disclosed pursuant to this subsection 5.7.

 

(C)                                Borrowers’
Actions Regarding Environmental Laws.

 

(i)                     Remedial
Actions Relating to Hazardous Materials Activities.  The Borrowers shall promptly undertake, and
shall cause each of their Subsidiaries promptly to undertake, any and all
investigations, studies, sampling, testing, abatement, cleanup, removal,
remediation or other response actions necessary to remove, remediate, clean up
or abate any Hazardous Materials Activity on, under or about any Facility that
is in violation of any Environmental Laws or that presents a material risk of
giving rise to an Environmental Claim. 
In the event the Borrowers or any of their Subsidiaries undertake any such
action with respect to any Hazardous Materials, the Borrowers or such
Subsidiary shall conduct and complete such action in compliance with all
applicable Environmental Laws and in accordance with the policies, orders and
directives of all Governmental Instrumentalities except when, and only to the
extent that, the Borrowers’ or such Subsidiary’s liability with respect to such
Hazardous Materials Activity is being contested in good faith by the Borrowers
or such Subsidiary.

 

(ii)                  Actions
with Respect to Environmental Claims and Violations of Environmental Laws.  The Borrowers shall promptly take, and shall
cause each of their Subsidiaries promptly to take, any and all actions
necessary to (a) cure any material violation of applicable Environmental Laws by
the Borrowers or their Subsidiaries and (b) make an appropriate response to any
Environmental Claim against Borrowers or

 

76

 

any of their
Subsidiaries and discharge any obligations it may have to any Person
thereunder.

 

5.8                                 Compliance with Material Contracts.

 

The Borrowers shall, and shall cause each of their
Subsidiaries to, comply, duly and promptly, in all material respects with its
and their respective obligations and enforce all of its and their respective
rights under all Material Contracts and all Operative Documents except where
the failure to comply could not reasonably be expected to have a Material
Adverse Effect.

 

5.9                                 Discharge of Liens.

 

(A)                              Removal
by the Borrowers.  In the event that,
notwithstanding the covenants contained in subsection 6.2, a Lien which
is not a Permitted Lien (other than a Phase II Mall Title Defect) may encumber
any Collateral or any portion thereof, the Borrowers shall promptly discharge
or cause to be discharged by payment to the lienor or Lien claimant or promptly
secure removal by bonding or deposit with the county clerk or otherwise or, at
the Administrative Agent’s option, and if obtainable promptly obtain title
insurance against, any such Lien or mechanics’ or materialmen’s claims of Lien
filed or otherwise asserted against such Collateral or any portion thereof
within 60 days after the date of notice thereof; provided that,
compliance with the provisions of this subsection 5.9 shall not be
deemed to constitute a waiver of the provisions of subsection 6.2.  The Borrowers shall exhibit to the
Administrative Agent upon request all receipts or other satisfactory evidence
of payment, bonding, deposit of taxes, assessments, Liens or any other item
which may cause any such Lien to be filed against any Collateral.  Each Borrower and each of its Subsidiaries
shall fully preserve the Lien and the priority of each Collateral Document
without cost or expense to the Administrative Agent or the Lenders.

 

(B)                                Removal
by the Agent.  If any Borrower or any
of its Subsidiaries fails to promptly discharge, remove or bond off any such
Lien or mechanics’ or materialmen’s claim of Lien as described above, which is
not being contested by either Borrower or any of its Subsidiaries in good faith
by appropriate proceedings promptly instituted and diligently conducted, within
30 days after the receipt of notice thereof, then the Administrative Agent
may, but shall not be required to, procure the release and discharge of such
Lien, mechanics’ or materialmen’s claim of Lien and any judgment or decree
thereon, and in furtherance thereof may, in its sole discretion, effect any
settlement or compromise with the lienor or Lien claimant or post any bond or
furnish any security or indemnity as the Administrative Agent, in its sole
discretion, may elect.  In settling,
compromising or arranging for the discharge of any Liens under this subsection,
the Administrative Agent shall not be required to establish or confirm the
validity or amount of the Lien.  The Borrowers
agree that all costs and expenses expended or otherwise incurred pursuant to
this subsection 5.9 (including reasonable attorneys’ fees and
disbursements) by the Administrative Agent shall be paid by the Borrowers in
accordance with the terms hereof.

 

77

 

5.10                           Further Assurances.

 

(A)                              Assurances.  Without expense or cost to the Administrative
Agent or the Lenders, each Borrower shall from time to time hereafter, execute,
acknowledge, file, record, do and deliver all and any further acts, deeds,
conveyances, mortgages, deeds of trust, deeds to secure debt, security
agreements, hypothecations, pledges, charges, assignments, financing statements
and continuations thereof, notices of assignment, transfers, certificates,
assurances and other instruments as the Administrative Agent may from time to
time reasonably require in order to carry out more effectively the purposes of
this Agreement or the other Loan Documents, including to subject any items of
Collateral, intended to now or hereafter be covered, to the Liens created by
the Collateral Documents, to perfect and maintain such Liens, and to assure,
convey, assign, transfer and confirm unto the Administrative Agent the property
and rights hereby conveyed and assigned or intended to now or hereafter be
conveyed or assigned or which either of the Borrowers may be or may hereafter
become bound to convey or to assign to the Administrative Agent for carrying
out the intention of or facilitating the performance of the terms of this
Agreement, or any other Loan Documents or for filing, registering or recording
this Agreement or any other Loan Documents. 
Promptly upon a reasonable request each Borrower shall execute and
deliver, and hereby authorizes the Administrative Agent to execute and file in
the name of such Borrower, to the extent the Administrative Agent may lawfully
do so, one or more financing statements, chattel mortgages or comparable
security instruments to evidence more effectively the Liens of the Collateral
Documents upon the Collateral.

 

(B)                                Filing
and Recording Obligations.  The
Borrowers shall pay or cause to be paid all filing, registration and recording
fees and all expenses incident to the execution and acknowledgment of the Deeds
of Trust or any other Loan Document, including any instrument of further
assurance described in subsection 5.10A, and shall pay or cause to be
paid all mortgage recording taxes, transfer taxes, general intangibles taxes
and governmental stamp and other taxes, duties, imposts, assessments and
charges arising out of or in connection with the execution, delivery, filing,
recording or registration of any Collateral Document or any other Loan
Document, the COREA, the Cooperation Agreement (or any amendments thereto) or
any leases or subleases entered into in connection with the Phase II Project
(except to the extent already recorded) or memoranda thereof, including any
instrument of further assurance described in subsection 5.10A, or by
reason of its interest in, or measured by amounts payable under, the Notes, any
Collateral Document or any other Loan Document, including any instrument of
further assurance described in subsection 5.10A, and shall pay all stamp
taxes and other taxes required to be paid on the Notes or any other Loan
Document, but excluding in the case of each Lender and the Administrative
Agent, Taxes imposed on its income by a jurisdiction under the laws of which it
is organized or in which its principal executive office is located or in which
its applicable lender office for funding or booking its Loans hereunder is
located.  If either Borrower fails to
make or cause to be made any of the payments described in the preceding
sentence within 15 days after notice thereof from the Administrative Agent
(or such shorter period as is necessary to protect the loss of or diminution in
value of any Collateral by reason of tax foreclosure or otherwise, as
determined by the Administrative Agent, in its sole discretion) accompanied by
documentation verifying the nature and amount of such payments, the
Administrative Agent may (but shall not be obligated to) pay the amount due and
the Borrowers shall reimburse all amounts in accordance with the terms hereof.

 

(C)                                Costs
of Defending and Upholding the Lien. 
The Administrative Agent may, upon at least five days’ prior notice to
the Borrowers, (i) appear in and defend any action or

 

78

 

proceeding,
in the name and on behalf of the Administrative Agent or the Lenders in which
the Administrative Agent or any Lender is named or which the Administrative
Agent in its sole discretion determines is reasonably likely to materially
adversely affect the Mortgaged Property, any other Collateral, any Collateral
Document, the Lien thereof or any other Loan Document and (ii) institute
any action or proceeding which the Administrative Agent reasonably determines
should be instituted to protect the interest or rights of the Administrative
Agent and the Lenders in the Mortgaged Property or other Collateral or under
any Loan Document.  The Borrowers agree
that all reasonable costs and expenses expended or otherwise incurred pursuant
to this subsection (including reasonable attorneys’ fees and
disbursements) by the Administrative Agent shall be paid by the Borrowers or
reimbursed to the Administrative Agent, as the case may be, promptly after
demand.

 

(D)                               Costs
of Enforcement.  The Borrowers agree
to bear and shall pay or reimburse the Administrative Agent and the Lenders in
accordance with the terms of subsection 9.2 for all reasonable
sums, costs and expenses incurred by the Administrative Agent and the Lenders
(including reasonable attorneys’ fees and the expenses and fees of any receiver
or similar official) of or incidental to the collection of any of the
Obligations, any foreclosure (or transfer in lieu of foreclosure) of this
Agreement, any Collateral Document or any other Loan Document or any sale of
all or any portion of the Mortgaged Property or all or any portion of the other
Collateral.

 

5.11                           Future Subsidiaries.

 

(A)                              Execution
of Collateral Documents.  In the
event that any Person becomes a Subsidiary on or after the Closing Date, the
Borrowers will promptly notify Administrative Agent of that fact and cause such
Subsidiary to execute and deliver to the Administrative Agent a supplement to
the Security Agreement and to take all such further actions and execute all
such further documents and instruments as may be necessary or, in the
reasonable opinion of the Administrative Agent, desirable to create in favor of
the Administrative Agent, for the benefit of the Secured Parties, a valid and
perfected First Priority Lien on all of the personal and mixed property assets
of such Subsidiary which constitute Collateral. 
The Borrowers shall deliver to the Administrative Agent together with
such Loan Documents all such further documents and instruments and take such
further action necessary to create in favor of the Administrative Agent, for
the benefit of the Secured Parties, a valid and perfected First Priority
security interest on any real property assets of such Subsidiary which
constitute Collateral, as the Administrative Agent may reasonably request from
time to time.

 

(B)                                Subsidiary
Charter Documents, Legal Opinions, Etc. 
The Borrowers shall deliver to the Administrative Agent, together with
such Loan Documents, (i) certified copies of such Subsidiary’s Certificate
or Articles of Incorporation or equivalent limited liability company documents,
together with a good standing certificate from the Secretary of State of the
jurisdiction of its incorporation and each other state in which such Person is
qualified as a foreign corporation to do business and, to the extent generally
available, a certificate or other evidence of good standing as to payment of any
applicable franchise or similar taxes from the appropriate taxing authority of
each of such jurisdictions, each to be dated a recent date prior to their
delivery to the Administrative Agent, (ii) a copy of such Subsidiary’s
Bylaws, certified by its corporate secretary or an assistant secretary (or
their equivalent) as of a recent date prior to

 

79

 

their
delivery to the Administrative Agent, (iii) a certificate executed by the
secretary or an assistant secretary of such Subsidiary as to (a) the fact
that the attached resolutions of the Board of Directors or managing member of
such Subsidiary approving and authorizing the execution, delivery and
performance of such Loan Documents are in full force and effect and have not
been modified or amended and (b) the incumbency and signatures of the
officers of such Subsidiary executing such Loan Documents, and (iv) a
favorable opinion of counsel to such Subsidiary, in form and substance
reasonably satisfactory to the Administrative Agent and its counsel, as to
(a) the due organization and good standing of such Subsidiary,
(b) the due authorization, execution and delivery by such Subsidiary of
such Loan Documents, (c) the enforceability of such Loan Documents against
such Subsidiary, (d) such other matters (including matters relating to the
creation and perfection of Liens in any Collateral pursuant to such Loan
Documents) as Administrative Agent may reasonably request, all of the foregoing
to be reasonably satisfactory in form and substance to the Administrative Agent
and its counsel.

 

5.12                           Interest Rate Protection.  No later than 90 days following the Closing
Date the Borrowers shall enter into one or more Rate Protection Agreements for
the remaining life to maturity of the Loans, and otherwise in form and
substance reasonably satisfactory to the Administrative Agent, with respect to
the notional amount of the Loans such that not less than 50% of the Loans
outstanding at any time are subject to such interest rate protection agreements.  On the date that the Rate Protection
Agreements are entered into, an Authorized Officer of the Borrowers shall
deliver duly executed counterparts of the Assignment of Rate Protection
Agreement.

 

5.13                           Phase II Mall Recognition Agreement.  On or prior to January 29, 2005 (time being
of the essence), the Administrative Agent shall have received executed
counterparts from GGP, LCR and the Borrowers of the Phase II Mall Recognition
Agreement and any supplements or amendments thereto, all of which shall have
been duly authorized, executed and delivered by the parties thereto, and shall
be certified by an Authorized Officer of each of the Borrowers and LCR as being
true, complete and correct and in full force and effect.

 

6.                                       Borrowers’ Negative Covenants.

 

The Borrowers covenant and agree with each Lender and
each Agent that until the Termination Date, the Borrowers shall perform all of
the covenants set forth in this Section 6.

 

6.1                                 Indebtedness.

 

The Borrowers shall not, and shall not permit any of
their Subsidiaries to, directly or indirectly, create, incur, assume or
guaranty, or otherwise become or remain directly or indirectly liable with
respect to, any Indebtedness, except:

 

(i)                     Indebtedness
in respect of the Obligations;

 

(ii)                  Indebtedness
existing on the Closing Date and set forth on Schedule 6.1; provided
that interest on such Indebtedness shall accrue until the maturity date
thereof, the scheduled maturity of such Indebtedness shall not be prior to six
(6) months after the Maturity Date and the terms of subordination of such
Indebtedness shall be reasonably acceptable to the Administrative Agent;

 

80

 

(iii)               the
Borrowers and their Subsidiaries may become and remain liable with respect to
Contingent Obligations permitted by subsection 6.4 and upon any matured
obligations actually arising pursuant thereto, the Indebtedness corresponding
to the Contingent Obligations so extinguished;

 

(iv)              the
Borrowers may become and remain liable with respect to the Phase II Mall
Contribution in the initial amount of $25,371,098 and as such amount may be
increased from time to time in order for the Borrowers to perform their
obligation under Section 5.5 of the Disbursement Agreement to keep the Phase II
Project In Balance; provided that interest, if any, on such Indebtedness
shall accrue (or be payable in kind) until the maturity date thereof, the
scheduled maturity of such Indebtedness shall not be prior to six (6) months
after the Maturity Date and the terms of subordination of such Indebtedness
shall be reasonably acceptable to the Administrative Agent;

 

(v)                 so
long as no Event of Default or Potential Event of Default has occurred and is
continuing or would result therefrom (other than a Potential Event of Default which
will be cured by the payment of proceeds from the Indebtedness permitted under
this clause (v)), Phase II Mall Subsidiary Holding may become and remain
liable with respect to subordinated unsecured loans in an aggregate amount
outstanding at any time not to exceed $1,000,000 and such additional amounts
approved by the Administrative Agent in its sole discretion; provided
that interest on such Indebtedness shall accrue (or be payable in kind) until
the maturity date thereof, the scheduled maturity of such Indebtedness shall
not be prior to six (6) months after the Maturity Date and the terms of
subordination of such Indebtedness shall be reasonably acceptable to the
Administrative Agent;

 

(vi)              the
Borrowers and their Subsidiaries may become and remain liable with respect to
indebtedness incurred with respect to Investments permitted under subsection
6.3 (other than subsections (iv), (x) or (xi));

 

(vii)           to
the extent that such incurrence does not result in the incurrence by the
Borrowers or any of their Subsidiaries of any obligation for the payment of
borrowed money of others, Indebtedness of the Borrowers or a Subsidiary
incurred solely in respect of performance bonds, completion guarantees, standby
letters of credit or bankers’ acceptances, letters of credit in order to
provide security for workers’ compensation claims, payment obligations in
connection with self insurance or similar requirements, surety and similar
bonds and statutory claims of lessors, licensees, contractors, franchisees or
customers; provided, that such Indebtedness was incurred in the ordinary
course of business of the Borrowers or any of their Subsidiaries or in
connection with the construction of the Phase II Mall and in an aggregate
principal amount outstanding under this clause at any one time of less than
$15,000,000 and that the payment of such Indebtedness is included in one or
more Line Items in the Project Budget;

 

(viii)        Indebtedness
arising from any agreement entered into by either of the Borrowers or any of
their Subsidiaries providing for indemnification, purchase price

 

81

 

adjustment or
similar obligations, in each case, incurred or assumed in connection with an
Asset Sale;

 

(ix)                to
the extent it constitutes Indebtedness, obligations under Hedging Agreements
that are incurred in accordance with subsection 5.12 this Agreement; and

 

(x)                   the
Borrowers and their Subsidiaries may become and remain liable with respect to
Indebtedness under the Phase II Mall Sale Reimbursement Agreement; provided
that the Phase II Mall Sale Reserve Account is not established or funded prior
to the Phase II Mall Release Date and the repayment of any other Indebtedness
thereunder shall not be due and payable and the exercise of rights and remedies
thereunder are not able to be exercised until the Loans and all other
Obligations have been indefeasibly paid and performed.

 

6.2                                 Liens and Related Matters.

 

(A)                              Prohibition on Liens.  The
Borrowers shall not, and shall not permit any of their Subsidiaries to,
directly or indirectly, create, incur, assume or permit to exist any Lien on or
with respect to any property or asset of any kind (including any document or
instrument in respect of goods or accounts receivable) of such Borrower or
Subsidiary, whether now owned or hereafter acquired, or any income or profits
therefrom, or file or permit the filing of, or permit to remain in effect, any
financing statement or other similar notice of any Lien with respect to any
such property, asset, income or profits under the Uniform Commercial Code of
any state or under any similar recording or notice statute, except Permitted
Liens.

 

(B)                                Equitable
Lien in Favor of Lenders.  If
Borrowers or any of their Subsidiaries shall create or assume any Lien upon any
of their respective properties or assets, whether now owned or hereafter
acquired, other than Permitted Liens, they shall make or cause to be made
effective provision whereby the Obligations will be secured by such Lien
equally and ratably with any and all other Indebtedness secured thereby as long
as any such Indebtedness shall be so secured; provided that,
notwithstanding the foregoing, this covenant shall not be construed as a
consent by Requisite Lenders to the creation or assumption of any such Lien
which is not a Permitted Lien.

 

(C)                                No
Further Negative Pledges.  Neither
the Borrowers nor any of their Subsidiaries, shall enter into any agreement
prohibiting the creation or assumption of any Lien upon any of its properties
or assets, whether now owned or hereafter acquired other than as provided
herein, in the other Loan Documents, in the Phase II Mall Contribution
Documents, in the Phase II Mall Sale Agreement or in the documents evidencing
Indebtedness which is permitted under subsection 6.1(v) or as required
by applicable law or any applicable rule or order of any Nevada Gaming
Authority.

 

(D)                               No
Restrictions on Subsidiary Distributions to the Borrowers.  The Borrowers will not, and will not permit
any of their Subsidiaries to, create or otherwise cause or suffer to exist or
become effective any consensual encumbrance or restriction of any kind on the
ability of any of their Subsidiaries  to (i) pay dividends or make any other
distributions on any of such Subsidiary’s capital stock owned by the Borrowers
or any other Subsidiary of the Borrowers,

 

82

 

(ii) repay
or prepay any Indebtedness owed by any such Subsidiaries to the Borrowers,
(iii) make loans or advances to the Borrowers, or (iv) transfer any
of its property or assets to the Borrowers other than (a) as provided herein,
in the other Loan Documents, in the Phase II Mall Contribution Documents or the
documents evidencing Indebtedness which is permitted under subsection 6.1(v),
(b) as otherwise reasonably approved by the Administrative Agent, (c) by reason
of customary non-assignment provisions in leases entered into the ordinary
course of business and consistent with past practices and any leases permitted
hereunder, (d) with respect to clause (iv), the Phase II Mall Sale Agreement or
(e) provisions with respect to the disposition or distribution of assets or
property in joint venture agreements and other similar agreements relating to
the assets or property of Supplier Joint Ventures permitted by subsection
6.3(iv).

 

6.3                                 Investments; Joint Ventures; Formation of
Subsidiaries.

 

The Borrowers shall not, and shall not permit any of
their Subsidiaries to, directly or indirectly, make or own any Investment in
any Person, including any Joint Venture or otherwise form or create any
Subsidiary, except:

 

(i)                     the
Borrowers and their Subsidiaries may make and own Investments in the Phase II
Mall provided that such Investments are otherwise in accordance with
this Agreement, the other Loan Documents and the Phase II Mall Sale Agreement
(unless the Borrowers have demonstrated to the Administrative Agent in its sole
determination that the Borrowers will not own any such Investment which is not
in accordance with the Phase II Mall Sale Agreement on the anticipated Phase II
Mall Release Date);

 

(ii)                  Investments
existing on the Closing Date and described in Schedule 6.3;

 

(iii)               any
Investment made as a result of the receipt of non-cash consideration from an
Asset Sale that was made pursuant to and in compliance with this Agreement;

 

(iv)              so
long as no Event of Default or Potential Event of Default shall have occurred
and be continuing or would result therefrom, the Borrowers or any of their
Subsidiaries may form and make Investments in new or existing Supplier Joint
Ventures; provided that (a) each such Investment shall appear in
the Project Budget as a separate Line Item, (b) the amount of each such
Investment shall not at any time exceed the amount of such Line Item,
(c) no Supplier Joint Venture shall own or operate or possess any material
license, franchise or right used in connection with the ownership or operation
of the Resort Complex or any material Phase II Project assets, (d) the
Borrowers shall have delivered an Officers’ Certificate which certifies that in
the reasonable judgment of such officer the Investment in such Supplier Joint
Venture will result in an economic benefit to the Borrowers (taking into
account such Investment) as a result of a reduction in the cost of the goods or
services being acquired from the Supplier Joint Venture over the life of the
Investment and (e) neither of the Borrowers nor any of their Subsidiaries shall
incur any liabilities or Contingent Obligations in respect of the obligations
of such Supplier Joint Venture;

 

(v)                 receivables
owing to the Borrowers or any Subsidiary if created or acquired in the ordinary
course of business and payable or dischargeable in accordance

 

83

 

with customary
trade terms; provided, that such trade terms may include such concessionary
trade terms as the Borrowers or any such Subsidiary deems reasonable under the
circumstances;

 

(vi)              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;

 

(vii)           the
Borrowers and their Subsidiaries may hold investments consisting of securities
or other obligations received in settlement of debt created in the ordinary
course of business and owing to the Borrowers or any Subsidiary or in
satisfaction of judgments;

 

(viii)        the
Borrowers and their Restricted Subsidiaries may incur any Contingent Obligation
permitted under subsection 6.4 to the extent such Contingent Obligation
constitutes an Investment permitted thereunder;

 

(ix)                the
Borrowers and their Subsidiaries may make and own Investments in Cash
Equivalents;

 

(x)                   the
Borrowers or any of their Subsidiaries may make loans or advances to their
employees or directors or former employees or directors in an amount not to
exceed $2,000,000 in the aggregate outstanding at any time; provided
that (a) each such loan shall appear in the Project Budget as a separate
Line Item and (b) the amount of each such loan shall not at any time exceed the
amount of such Line Item; and

 

(xi)                the
Borrowers and their Subsidiaries may make and own other Investments in an
aggregate amount not to exceed at any time $1,000,000; provided that
(a) each such Investment shall appear in the Project Budget as a separate
Line Item and (b) the amount of each such Investment shall not at any time
exceed the amount of such Line Item.

 

6.4                                 Contingent Obligations.

 

The Borrowers shall not, and shall not permit any of
their Subsidiaries to, directly or indirectly, create or become or remain
liable with respect to any Contingent Obligation, except:

 

(i)                     the
Borrowers and their Subsidiaries may become and remain liable with respect to
Contingent Obligations under Rate Protection Agreements or other Hedging
Agreements entered into in accordance with subsection 5.12 of this
Agreement;

 

(ii)                  the
Borrowers and their Subsidiaries may become and remain liable with respect to
the Contingent Obligations for Indebtedness permitted under subsection 6.1
to the extent such Borrower or such Subsidiary is permitted to incur such
Indebtedness under subsection 6.1;

 

84

 

(iii)               Investments
permitted under subsection 6.3 to the extent they constitute Contingent
Liabilities;

 

(iv)              the
Borrowers may become and remain liable for customary indemnities under the
Project Documents and Resort Complex Operative Documents to which they are a
party; and

 

(v)                 Phase
II Mall Subsidiary Holding may become and remain liable with respect to
Contingent Obligations under the Phase II Mall Sale Reimbursement Agreement
which are to be paid or performed on and after the Phase II Mall Release Date.

 

6.5                                 Restricted Payments.

 

Borrowers shall not, and shall not permit any of their
Subsidiaries to, directly or indirectly, declare, order, pay, make or set apart
any sum for any Restricted Payment, except:

 

(i)                                     the
Borrowers and their Subsidiaries may redeem or purchase any equity interests in
the Borrowers or their Subsidiaries or any Indebtedness of the Borrowers or
their Subsidiaries to the extent required by any Nevada Gaming Authority or any
other applicable gaming authority in order to preserve a material Gaming
License;

 

(ii)                                  the
Borrowers and their Subsidiaries may make payments or distributions of Phase II
Mall Borrower Taxes in accordance with Section 5.3(C); and

 

(iii)                               the
Borrowers may make other Restricted Payments to each other in an amount not to
exceed $1,000,000.

 

6.6                                 Restriction on Fundamental Changes;
Asset Sales; Leases and Acquisitions.

 

The Borrowers shall not, and shall not permit any of
their Subsidiaries to, alter the corporate, capital or legal structure (except
with respect to changes in capital structure to the extent a Change of Control
does not occur as a result thereof) of any Borrower, or any of its
Subsidiaries, or enter into any transaction of merger or consolidation, or
liquidate, wind-up or dissolve itself (or suffer any liquidation or
dissolution), or convey, sell, lease or sub-lease (as lessor or sublessor),
transfer or otherwise dispose of, in one transaction or a series of
transactions, all or any part of its business, property or assets, whether now
owned or hereafter acquired (other than inventory in the ordinary course of
business), or acquire by purchase or otherwise all or substantially all the
business, property or fixed assets of, or stock or other evidence of beneficial
ownership of, any Person or any division or line of business of any Person,
except:

 

(i)                     as
permitted under the terms of this Agreement or any other Loan Document;

 

(ii)                  the
Borrowers and their Subsidiaries may dispose of obsolete, worn out or surplus
assets or assets no longer used or useful in the business of the Borrowers and
their Subsidiaries in each case to the extent in the ordinary course of
business,

 

85

 

provided
that either (i) such disposal does not materially adversely affect the value of
the Collateral and is not prohibited by the Phase II Mall Sale Agreement
(unless the Borrowers have demonstrated to the Administrative Agent in its sole
determination that such disposition will not delay the anticipated Phase II
Mall Release Date) or (ii) prior to or promptly following such disposal any
such property shall be replaced with other property of substantially equal
utility and a value at least substantially equal to that of the replaced
property when first acquired and free from any Liens other than Permitted Liens
and by such removal and replacement the Borrowers and their Subsidiaries shall
be deemed to have subjected such replacement property to the Lien of the
Collateral Documents in favor of Lenders, as applicable;

 

(iii)               the
Borrowers and their Subsidiaries may have an Event of Loss;

 

(iv)              (a)
Phase II Mall Subsidiary may enter into leases of space in the Phase II Mall
which conform to the requirements of the Phase II Mall Sale Agreement, using a
form of lease which has been approved by Phase II Mall Subsidiary and GGP and
reasonably approved by the Administrative Agent, (b) the Borrowers and their
Subsidiaries may be a party to any lease in effect on the Closing Date, each of
which is set forth on Schedule 6.6 hereto (as such lease may be amended,
modified or supplemented in accordance with the terms of this Agreement) or (c)
enter into any other lease in connection with the business of the Borrowers and
their Subsidiaries as may be permitted under subsection 6.11 so long as
each such lease is permitted under the Phase II Mall Sale Agreement;

 

(v)                 after
Substantial Completion either Borrower may be merged with the other Borrower;

 

(vi)              either
Borrower may sell, lease or otherwise transfer assets to the other Borrower so
long as such sale, lease or transfer is permitted by the Phase II Mall Sale
Agreement or otherwise approved by GGP;

 

(vii)           the
Borrowers may sell receivables for fair market value in the ordinary course of
business;

 

(viii)        the
Borrowers and their Subsidiaries may incur Liens permitted under subsection
6.2;

 

(ix)                the
consummation of the Transactions on the Closing Date and any other transactions
contemplated thereby; and

 

(x)                   on
the Phase II Mall Release Date, Phase II Mall Subsidiary Holding may sell,
transfer and convey the equity interests of Phase II Mall Subsidiary to GGP in
accordance with the Phase II Mall Sale Agreement.

 

Notwithstanding the foregoing, the provisions of this subsection
6.6, clauses (iv)(b) and (c) shall be subject to the
additional provisos that:  (a) no Event
of Default or Potential Event of Default shall exist and be continuing at the
time of such transaction or lease or would occur after as a result of entering
into such transaction or lease (or immediately after any renewal or

 

86

 

extension
thereof at the option of the Borrowers or their Subsidiaries), (b) such
transaction or lease will not materially interfere with, impair or detract from
the operation of the business of the Borrowers and their Subsidiaries, (c) such
transaction or lease is at a fair market rent or value (in light of other
similar or comparable prevailing commercial transactions) and contains such
other terms such that the lease, taken as a whole, is commercially reasonable
and fair to the Borrowers and their Subsidiaries in light of prevailing or
comparable transactions in other shopping venues or other applicable venues,
(d) no gaming or casino operations may be conducted on any space that is
subject to such transaction or lease other than by the LVSI, Venetian and LCR,
(e) no lease may provide that the Borrowers or any of their Subsidiaries may
subordinate its fee, or leasehold interest to any lessee or any party financing
any lessee, and (f) the tenant under such lease shall provide Administrative
Agent on behalf of the Lenders with a Subordination, Non-Disturbance and
Attornment Agreement substantially in the form of Exhibit G-1; provided,
however, the form of Subordination, Non-Disturbance and Attornment
Agreement to be delivered by such tenant party may be in a different form if
such form is otherwise reasonably acceptable to the Administrative Agent unless
the Administrative Agent is satisfied that such lease contains reasonably
comparable (or better) terms as to subordination, attornment and
non-disturbance with respect to its tenant as would be obtained were an
agreement in the form of Exhibit G-1 executed and delivered in which
case no Subordination, Non-Disturbance and Attornment Agreement shall be
required.

 

6.7                                 Sales and Lease-Backs.

 

The Borrowers shall not, and shall not permit any of
their Subsidiaries to, directly or indirectly, become or remain liable as
lessee or as a guarantor or other surety with respect to any lease, whether an
Operating Lease or a Capital Lease, of any property (whether real, personal or
mixed), whether now owned or hereafter acquired, (i) which Borrowers or
any of their Subsidiaries has sold or transferred or is to sell or transfer to
any other Person or (ii) which Borrowers or any of their Subsidiaries
intends to use for substantially the same purpose as any other property which
has been or is to be sold or transferred by the Borrowers or any of their
Subsidiaries to any Person in connection with such lease.

 

6.8                                 Sale or Discount of Receivables.

 

The Borrowers shall not, and shall not permit any of
their Subsidiaries to, directly or indirectly, sell with recourse, or discount
or otherwise sell for less than the face value thereof, any of its notes or
accounts receivable other than an assignment for purposes of collection in the
ordinary course of business.

 

6.9                                 Transactions with Shareholders and
Affiliates.

 

The Borrowers shall not, and shall not permit any of
their Subsidiaries to, directly or indirectly, enter into or permit to exist
any transaction (including the purchase, sale, lease or exchange of any
property or the rendering of any service) with any Borrower or with any
Affiliate of a Borrower, except, that the Borrowers and their Subsidiaries may
enter into and permit to exist:

 

87

 

(i)                     transactions
that are on terms that are not less favorable to the Borrowers or their
Subsidiaries, as the case may be, than those that might be obtained at the time
from Persons who are not such an Affiliate if the Borrowers have delivered to
the Administrative Agent (a) with respect to any transaction involving an
amount in excess of $1,000,000, an Officers Certificate certifying that such
transaction complies with this clause (i), (b) with respect to any
transaction involving an amount in excess of $2,000,000, a resolution adopted
by a majority of the disinterested non-employee directors of the managing
member of the Borrowers or their Subsidiary, as the case may be, approving such
transaction and an Officers Certificate certifying that such transaction
complies with this clause (i) and (c) with respect to any such
transactions that involves aggregate payments in excess of $15,000,000 or that
involve Indebtedness in excess of $15,000,000, an opinion as to the fairness to
such Borrower from a financial point of view issued by an Independent Financial
Advisor at the time such transaction is entered into;

 

(ii)                  purchases
of materials or services from a Supplier Joint Venture by the Borrowers or any
of their Subsidiaries in the ordinary course of business on arm’s length terms;

 

(iii)               any
employment, compensation, indemnification, noncompetition or confidentiality
agreement or arrangement entered into by the Borrowers or any of their
Subsidiaries with their employees or directors in the ordinary course of
business;

 

(iv)              the
payment of reasonable fees to directors of the Borrowers and their Subsidiaries
who are not employees of the Borrowers or their Subsidiaries;

 

(v)                 transactions
between or among Borrowers and any of their wholly-owned Subsidiaries that are
not otherwise prohibited hereby;

 

(vi)              the
transactions contemplated by the Disbursement Agreement and each Project
Document;

 

(vii)           the
transactions contemplated by the Cooperation Agreement;

 

(viii)        the
Master Lease, Phase II Mall Lease, the Phase II Mall Sale Reimbursement
Agreement, the Intercompany Mall Note, the Disbursement Agreement and the
transactions contemplated thereunder, the assignment of the Walgreens Lease by
LCR to Phase II Mall Subsidiary, the assignment of the Phase II Mall Sale
Agreement by LCR to Phase II Mall Subsidiary Holding pursuant to the Phase II
Mall SA Assignment Agreement and the transactions contemplated thereby and the
contemplated transfer of the Phase II Air Parcel to Phase II Mall Subsidiary;

 

(ix)                Investments
permitted by subsection 6.3 and Restricted Payments permitted by subsection
6.5;

 

(x)                   transactions
consummated on the Closing Date in connection with the Transactions;

 

88

 

(xi)                transactions
and agreements permitted by subsection 6.1;

 

(xii)             transactions
permitted by subsection 6.6 (other than clause (iv) thereof
unless approved by the Administrative Agent, which approval will not be
unreasonably withheld if such transaction is on terms that are not less
favorable to the Borrowers or their Subsidiaries, as the case may be, than
those that might be obtained at the time from Persons who are not an Affiliate
of the Borrowers);

 

(xiii)          payments
and other transactions contemplated by the tax sharing agreement contemplated
by subsection 5.3(B); and

 

(xiv)         transactions
and agreements set forth on Schedule 6.9.

 

6.10                           Disposal of Subsidiary Stock.

 

The Borrowers shall not, and shall not permit any of
their Subsidiaries to, directly or indirectly sell, assign, pledge or otherwise
encumber or dispose of any shares of capital stock or other equity Securities
of the Borrowers or any of their Subsidiaries except (i) in connection with the
sale by Phase II Mall Subsidiary Holding of the equity interests of Phase II
Mall Subsidiary to GGP in accordance with the Phase II Mall Sale Agreement,
(ii) to qualify directors if required by applicable law, (iii) to the extent
required by any Nevada Gaming Authority or any other gaming authority in order
to preserve a material Gaming License and (iv) as permitted by Section 6.6
(v).

 

6.11                           Conduct of Business.

 

The Borrowers shall not and shall not permit any of
their Subsidiaries to engage in any business other than (1) owning, holding,
designing, developing, constructing, managing, marketing and operating the
Phase II Mall, (ii) any activity and business incidental, related or similar
thereto, and (iii) engaging in any business or activity that is a reasonable
extension, development or expansion thereof or ancillary thereto including any
retail, restaurant and entertainment business, retail sales or other activity
or business designed to promote, market, support, develop, construct or enhance
the retail, restaurant and entertainment mall business, retail sales or such
other activity of the Phase II Mall (including, owning and operating joint
ventures to supply materials or services for the construction or operation of
the Phase II Mall so long as proceeds of the Loans are not used in connection
therewith).

 

6.12                           Certain Restrictions on Changes to
Certain Documents.

 

(A)                              Modifications
of Certain Operative Documents and Permits; New Material Contracts or Permits.  Except as permitted under the Disbursement
Agreement and the Cooperation Agreement (to the extent applicable to the Phase
II Project), as applicable, the Borrowers shall not, and shall not permit any
of their Subsidiaries to, agree to any material amendment to, or waive any of
its material rights under, any Permit or Material Contract or enter into new
Material Contracts (other than Project Documents permitted by, and in
accordance with the terms of, the Disbursement Agreement and the Cooperation
Agreement (to the extent applicable to the Phase II Project) or Permits (it
being understood that any Material Contracts which are covered by clause B
or C below shall also be subject to the restrictions set forth

 

89

 

therein) without in each case obtaining the prior written consent of
the Administrative Agent if, in any such case, such amendment or waiver or new
Material Contract or Permit could reasonably be expected to have a Material
Adverse Effect or otherwise adversely affect Lenders in any material respect.

 

(B)                                Amendments
of Documents Relating to Phase II Mall Contribution.  The Borrowers shall not, and shall not permit
any of their Subsidiaries to, amend or otherwise change the terms of any
documents governing the Phase II Mall Contribution (other than in accordance
with the terms thereof or as contemplated by Section 6.1(iv)), or make
any payment consistent with an amendment thereof or change thereto, if (a) the
effect of such amendment or change is to increase the interest rate or fees on
such Indebtedness, change (to earlier dates) any dates upon which payments of principal
or interest are due thereon, change any event of default or condition to an
event of default with respect thereto (other than to eliminate any such event
of default or increase any grace period related thereto or otherwise change
such event of default in a manner more favorable to such Borrower or such
Subsidiary than the existing event of default), increase the initial principal
amount thereof unless such increase is required to perform the Borrowers’
obligations under Section 5.5 of the Disbursement Agreement, change the
redemption provisions thereof (in a manner less favorable to such Borrower or
such Subsidiary), change the subordination provisions thereof (or of any
guaranty thereof), or change any collateral therefor (other than to release such
collateral).

 

(C)                                Certain
Other Restrictions on Amendments. 
The Borrowers shall not, and shall not permit any of their Subsidiaries
to, agree to any material amendment to, or waive any of its material rights
under the Resort Complex Operative Documents which would require the consent of
the Administrative Agent, without first obtaining the prior written consent of
the Administrative Agent, which consent shall not be unreasonably withheld or
delayed.

 

(D)                               Consent
to Certain Agreements. 
Notwithstanding the foregoing provisions of this subsection 6.12,
on or after the Closing Date, the Borrowers may enter into (1) a separate
agreement or an amendment to the HVAC Services Agreement (to provide for the
provision of heating, ventilation and air conditioning to the Phase II Mall),
(2) amendments to the Cooperation Agreement (to the extent applicable to the
Phase II Project)(to cover the relationship between the Existing Facility and
the Phase II Project and/or the relationship between the Phase II Project and the
Phase II Mall, and to otherwise reflect the fact that the integrated complex
includes, or will include, the Existing Facility and the Phase II Project and
to replace the reference to “one (1) year” in the second sentence of Section 13
of Article X with a reference to “three (3) years”) and (3) the COREA, in each
case, pursuant to the terms of subsection 6.1 of the Disbursement Agreement,
and in each case in form and substance reasonably satisfactory to the
Administrative Agent.

 

6.13                           Capital Expenditures.

 

Prior to Substantial Completion the Borrowers shall not,
and shall not permit their Subsidiaries to, make or incur Capital Expenditures
other than with respect to Phase II Mall Project Costs and Investments
permitted under subsection 6.3(i).

 

90

 

6.14                           Fiscal Year.

 

Neither Borrower shall change its Fiscal Year-end from
December 31.

 

6.15                           Zoning and Contract Changes and
Compliance.

 

Without the prior written approval of the Administrative
Agent, the Borrowers shall not, and shall not permit any of their Subsidiaries
to, initiate or consent to any zoning downgrade of the Mortgaged Property or
use or permit the use of the Mortgaged Property in any manner that could result
in such use becoming a non-conforming use (other than a non-conforming use
permissible under automatic grandfathering provisions) under any zoning
ordinance or any other applicable land use law, rule or regulation.  The Borrowers shall not, and shall not permit
any of their Subsidiaries to, initiate or consent to any change in any laws,
requirements of Governmental Instrumentalities or obligations created by
private contracts which now or hereafter could reasonably be likely to
materially and adversely affect the ownership, occupancy, use or operation of
the Mortgaged Property without the prior written consent of the Administrative
Agent.

 

6.16                           No Joint Assessment; Separate Lots.

 

Without the prior written approval of the Administrative
Agent, which approval may be granted, withheld, conditioned or delayed in its
sole discretion, the Borrowers shall not suffer, permit or initiate, and shall
not permit any of their Subsidiaries to, suffer, permit or initiate, the joint
assessment of the Mortgaged Property (i) with any other real property constituting
a separate tax lot (other than, prior to creation of the Phase II Mall Air
Parcel, the Site and the Phase II Mall Air Space, and after such creation, the
parcels comprising the Phase II Mall Parcel) and (ii) with any portion of
the Mortgaged Property which may be deemed to constitute personal property, or
any other procedure whereby the Lien of any Taxes which may be levied against
any such personal property shall be assessed or levied or charged to the
Mortgaged Property as a single Lien.

 

6.17                           Application of Mall Sales Proceeds.  The Borrowers shall apply any proceeds
received pursuant to the Phase II Mall Sale Agreement to repay in full all
amounts outstanding under this Agreement within five days of the receipt
thereof before applying to any other obligation or for any other purpose.

 

7.                                       Events of Default.

 

If any of the following conditions or events set forth
in this Section shall occur (any such conditions or events collectively “Events
of Default”):

 

7.1                                 Failure to Make Payments When Due.

 

Failure by the Borrowers to pay any installment of
principal on any Loan when due, whether at stated maturity, by acceleration, by
notice of voluntary prepayment, by mandatory prepayment or otherwise; or
failure by the Borrowers to pay any interest on any Loan or any fee or any
other amount due under this Agreement within five days after the date due; or

 

91

 

7.2                                 Default under Other Indebtedness or
Contingent Obligations.

 

(i)  Failure of any Borrower or any of its Subsidiaries
or LVSI or Venetian (or any of their Restricted Subsidiaries) to pay when due
any principal of or interest on or any other amount payable in respect of one
or more items of Indebtedness (other than Indebtedness of the Borrowers
referred to in subsection 7.1) or Contingent Obligations in an
individual principal amount of (x) as to the Borrowers and their Subsidiaries,
$10,000,000 or more or with an aggregate principal amount of $25,000,000 or
more and (y) as to LVSI or Venetian (or any of their Restricted Subsidiaries),
$25,000,000 or more with an aggregate principal amount of $50,000,000 or more,
or in respect of the Intercompany Mall Note, in each case beyond the end of any
grace period provided therefor; or (ii) breach or default by any Borrower or
any of its Subsidiaries or LVSI or Venetian (or any of their Restricted
Subsidiaries) with respect to any other material term of (a) one or more items
of Indebtedness or Contingent Obligations in the individual or aggregate
principal amounts referred to in clause (i) above (b) the Intercompany
Note or (c) any loan agreement, mortgage, indenture or other agreement
relating to such item(s) of Indebtedness or Contingent Obligation(s), if the
effect of such breach or default is to cause, or to permit the holder or
holders of that Indebtedness or Contingent Obligation(s) (or a trustee on
behalf of such holder or holders) to cause, that Indebtedness or Contingent
Obligation(s) to become or be declared due and payable prior to its stated
maturity or the stated maturity of any underlying obligation, as the case may
be (upon the giving or receiving of notice, lapse of time, both, or otherwise);
or

 

7.3                                 Breach of Certain Covenants.

 

Failure of the Borrowers to perform or comply with any
term or condition contained in subsection 2.5, 5.2, 5.13
or Section 6 of this Agreement; or

 

7.4                                 Breach of Warranty.

 

Any representation, warranty, certification or other
statement made by the Borrowers or any of their Subsidiaries in any Loan
Document (other than the Disbursement Agreement) or in any statement or
certificate at any time given by the Borrowers or any of their Subsidiaries in
writing pursuant hereto or thereto or in connection herewith or therewith shall
be false in any material respect on the date as of which made; or

 

7.5                                 Other Defaults Under Loan Documents.

 

(i)  Either of the
Borrowers shall default in the performance of or compliance with any term
contained in this Agreement or any of the other Loan Documents (other than the
Disbursement Agreement), other than any such term referred to in any other
subsection of this Section 7, and such default shall not have been
remedied or waived within 30 days after the earlier of (x) an officer of the
Borrowers becoming aware of such default or (y) receipt by the Borrowers of notice
from Administrative Agent or any Lender of such default; or (ii) an Event of
Default shall have occurred and be continuing under the Disbursement Agreement;
or

 

7.6                                 Involuntary Bankruptcy; Appointment of
Receiver, etc.

 

(i) A court having jurisdiction in the premises
shall enter a decree or order for relief in respect of a Borrower or any of its
Subsidiaries or LVSI, Venetian or any of their Restricted Subsidiaries in an
involuntary case under the Bankruptcy Code or under any other applicable

 

92

 

bankruptcy,
insolvency or similar law now or hereafter in effect, which decree or order is
not stayed; or any other similar relief shall be granted under any applicable
federal or state law; or (ii) an involuntary case shall be commenced against a
Borrower or any of its Subsidiaries or LVSI, Venetian or any of their
Restricted Subsidiaries, under the Bankruptcy Code or under any other
applicable bankruptcy, insolvency or similar law now or hereafter in effect; or
a decree or order of a court having jurisdiction in the premises for the
appointment of a receiver, liquidator, sequestrator, trustee, custodian or
other officer having similar powers over such Person, or over all or a
substantial part of its property, shall have been entered; or there shall have
occurred the involuntary appointment of an interim receiver, trustee or other
custodian of a Borrower or any of its Subsidiaries or LVSI, Venetian or any of
their Restricted Subsidiaries, for all or a substantial part of its property;
or a warrant of attachment, execution or similar process shall have been issued
against any substantial part of the property of a Borrower or any of its
Subsidiaries or LVSI, Venetian or any of their Restricted Subsidiaries, and any
such event described in this clause (ii) shall continue for 60 days
unless dismissed, bonded or discharged; or

 

7.7                                 Voluntary Bankruptcy; Appointment of
Receiver, etc.

 

(i) A Borrower or any of its Subsidiaries or LVSI,
Venetian or any of their Restricted Subsidiaries shall have an order for relief
entered with respect to it or commence a voluntary case under the Bankruptcy
Code or under any other applicable bankruptcy, insolvency or similar law now or
hereafter in effect, or shall consent to the entry of an order for relief in an
involuntary case, or to the conversion of an involuntary case to a voluntary
case, under any such law, or shall consent to the appointment of or taking
possession by a receiver, trustee or other custodian for all or a substantial part
of its property; or a Borrower or any of its Subsidiaries or LVSI, Venetian or
any of their Restricted Subsidiaries shall make any assignment for the benefit
of creditors; or (ii) a Borrower or any of its Subsidiaries or LVSI,
Venetian or any of their Restricted Subsidiaries shall be unable, or shall fail
generally, or shall admit in writing its inability, to pay its debts as such
debts become due and in each case a period of 30 days shall have elapsed; or
the Board of Directors of a Borrower or any of its Subsidiaries or LVSI,
Venetian or any of their Restricted Subsidiaries (or any committee thereof) or
of its managing member shall adopt any resolution or otherwise authorize any
action to approve any of the actions referred to in clause (i) above or
this clause (ii); or

 

7.8                                 Judgments and Attachments.

 

Any money judgment, writ or warrant of attachment or
similar process involving (i) in any individual case an amount in excess
of $2,500,000 or (ii) in the aggregate at any time an amount in excess of
$7,500,000 (in either case not adequately covered by insurance as to which a
solvent and unaffiliated insurance company has acknowledged coverage) shall be
entered or filed against a Borrower or any of its Subsidiaries or any of their
respective assets and shall remain unpaid and undischarged, unvacated, unbonded
or unstayed for a period of 60 days (or in any event later than five days prior
to the date of any proposed sale thereunder); or

 

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7.9                                 Dissolution.

 

Any order, judgment or decree shall be entered against a
Borrower or any of its Subsidiaries decreeing the dissolution or split up of
such Person and such order shall remain undischarged or unstayed for a period
in excess of 30 days; or

 

7.10                           Employee Benefit Plans.

 

There shall occur one or more ERISA Events which
individually or in the aggregate results in or might reasonably be expected to
result in liability of a Borrower, or any of its Subsidiaries or any of their
respective ERISA Affiliates in excess of $5,000,000 during the term of this
Agreement; or there shall exist an amount of unfunded benefit liabilities (as
defined in Section 4001(a)(18) of ERISA), individually or in the aggregate for
all Pension Plans (excluding for purposes of such computation any Pension Plans
with respect to which assets exceed benefit liabilities), which exceeds
$10,000,000; or

 

7.11                           Failure of Collateral Document;
Repudiation of Obligations.

 

(i) Any Collateral Document shall cease to be in full
force and effect (other than by reason of a release of Collateral thereunder in
accordance with the terms hereof or thereof, the satisfaction in full of the
Obligations or any other termination of such Collateral Document in accordance
with the terms hereof or thereof) or shall be declared null and void by a
Governmental Instrumentality of competent jurisdiction, or the Administrative
Agent shall not have or shall cease to have a valid and perfected First
Priority Lien in the Collateral for any reason other than the failure of the
Administrative Agent or any Lender to take any action within its control,
except as otherwise contemplated in any Loan Document or (ii) either Borrower
shall contest the validity or enforceability of any Loan Document in writing or
deny in writing that it has any further liability prior to the Termination
Date; or

 

7.12                           Default Under or Termination of
Operative Documents.

 

Any of the Operative Documents (other than the Loan
Documents) shall terminate or be terminated or canceled, prior to its stated
expiration date or either Borrower shall be in default (after the giving of any
applicable notice and the expiration of any applicable grace period) or any
Affiliate of the Borrowers, LVSI or Venetian shall be in default (after the
giving of any applicable notice and the expiration of any applicable grace
period) under any such Operative Documents; provided that a default or
termination under any Operative Document (other than the Phase II Mall Sale
Agreement) shall constitute an Event of Default hereunder only if such default
or termination would reasonably be expected to cause a Material Adverse Effect;
and further  provided that the wrongful termination by GGP of the
Phase II Mall Sale Agreement shall constitute an Event of Default hereunder
only if Phase II Mall Subsidiary Holding fails, within sixty (90) days of such
termination, either (i) to obtain from a lender which has been reasonably
approved by the Administrative Agent a commitment in the amount required to pay
in full the Obligations (other than those which survive the expiration or
earlier termination of the Loan Documents) and having terms and conditions
(including the closing date thereunder) reasonably acceptable to the
Administrative Agent or (ii) to obtain a commitment to purchase the Phase II
Mall from a purchaser which has been reasonably approved by the Administrative
Agent on terms which are no less beneficial to the Borrowers and the Lenders in
any material respect than the Phase II Mall Sale Agreement for an amount which
will pay in full all

 

94

 

Obligations
(other than those which survive the expiration or earlier termination of the
Loan Documents) and all other amounts required to be paid on the date that the
Phase II Mall is to be conveyed in accordance with such agreement and otherwise
reasonably satisfactory to the Administrative Agent and within a reasonable
period of time thereafter to enter into an agreement with such purchaser to
purchase the Phase II Mall and sell the Phase II Mall to such purchaser in
accordance with such agreement.

 

7.13                           Default Under or Termination of Permits.

 

A Borrower or any of its Subsidiaries shall fail to
observe, satisfy or perform, or there shall be a violation or breach of, any of
the material terms, provisions, agreements, covenants or conditions attaching
to or under the issuance to such Person of any material Permit, including the
Gaming License held by LVSI or any such Permit or any material provision
thereof shall be terminated or fail to be in full force and effect or any
Governmental Instrumentality shall challenge or seek to revoke any such Permit
if such failure to perform, breach or termination could reasonably be expected
to have a Material Adverse Effect; or

 

7.14                           Certain Investments.

 

Adelson or any of his Affiliates (other than the
Borrowers and their Subsidiaries) that is not a Subsidiary of LVSI shall
directly acquire or hold any Investment in any Subsidiary of Phase II Mall
Subsidiary Holding other than through Phase II Mall Subsidiary Holding;

 

THEN (i) upon the
occurrence of any Event of Default described in subsection 7.6 or 7.7,
each of (a) the unpaid principal amount of and accrued interest on the
Loans and (b) all other Obligations shall automatically become immediately
due and payable, without presentment, demand, protest or other requirements of
any kind, all of which are hereby expressly waived by the Borrowers, and the
obligation of each Lender to make any Loan hereunder shall thereupon terminate,
and (ii) upon the occurrence and during the continuation of any other
Event of Default, the Administrative Agent shall, upon the written request or
with the written consent of Requisite Lenders, by written notice to the
Borrowers, declare all or any portion of the amounts described in clauses
(a) and (b) above to be, and the same shall forthwith become,
immediately due and payable, and the obligation of each Lender to make any Loan
hereunder shall thereupon terminate.

 

Notwithstanding anything contained in the preceding
paragraph, if at any time within 60 days after an acceleration of the Loans
pursuant to clause (ii) of such paragraph the Borrowers shall pay all
arrears of interest and all payments on account of principal which shall have
become due otherwise than as a result of such acceleration (with interest on
principal and, to the extent permitted by law, on overdue interest, at the
rates specified in this Agreement) and all Events of Default and Potential
Events of Default (other than non-payment of the principal of and accrued
interest on the Loans, in each case which is due and payable solely by virtue
of acceleration) shall be remedied or waived pursuant to subsection 9.6,
then Requisite Lenders, by written notice to the Borrowers, may at their option
rescind and annul such acceleration and its consequences; but such action shall
not affect any subsequent Event of Default or Potential Event of Default or
impair any right consequent thereon.  The
provisions of this paragraph are intended merely to bind Lenders to a decision
which may be made at the election of Requisite Lenders and are not

 

95

 

intended,
directly or indirectly, to benefit the Borrowers, and such provisions shall not
at any time be construed so as to grant the Borrowers the right to require
Lenders to rescind or annul any acceleration hereunder or to preclude
Administrative Agent or Lenders from exercising any of the rights or remedies
available to them under any of the Loan Documents, even if the conditions set
forth in this paragraph are met.

 

8.                                       Agents and Arranger.

 

8.1                                 Appointment.

 

(A)                              Appointment
of the Administrative Agent.  Scotia
Capital is hereby appointed Administrative Agent hereunder and under the other
Loan Documents and each Lender hereby authorizes the Administrative Agent to
act as its agent in accordance with the terms of this Agreement and the other
Loan Documents.  The Administrative Agent
agrees to act upon the express conditions contained in this Agreement and the
other Loan Documents, as applicable.  The
provisions of this Section 8 (other than the second proviso
to the first sentence of subsection 8.6) are solely for the benefit of
the Administrative Agent and the Lenders; the Borrowers shall have no rights as
a third party beneficiary of any of the provisions thereof.  In performing its functions and duties under
this Agreement, the Administrative Agent shall act solely as an agent of the
Lenders and does not assume and shall not be deemed to have assumed any
obligation towards or relationship of agency or trust with or for the Borrowers
or any of their Subsidiaries.

 

(B)                                Appointment
of Supplemental Agents.  It is the
purpose of this Agreement and the other Loan Documents that there shall be no
violation of any law of any jurisdiction denying or restricting the right of
banking corporations or associations to transact business as agent or trustee
in such jurisdiction.  It is recognized
that in case of litigation under this Agreement or any of the other Loan
Documents, and in particular in case of the enforcement of any of the Loan
Documents, or in case the Administrative Agent deems that by reason of any
present or future law of any jurisdiction it may not exercise any of the
rights, powers or remedies granted herein or in any of the other Loan Documents
or take any other action which may be desirable or necessary in connection
therewith, it may be necessary that the Administrative Agent appoint an
additional individual or institution as a separate collateral agent or
collateral co-agent (any such additional individual or institution being
referred to here individually as a “Supplemental Agent” and collectively
as “Supplemental Agents”).

 

In the event that the Administrative Agent appoints a
Supplemental Agent with respect to any Collateral, (i) each and every
right, power, privilege or duty expressed or intended by this Agreement or any
of the other Loan Documents to be exercised by or vested in or conveyed to the
Administrative Agent with respect to such Collateral shall be exercisable by
and vest in such Supplemental Agent to the extent, and only to the extent,
necessary to enable such Supplemental Agent to exercise such rights, powers and
privileges with respect to such Collateral and to perform such duties with
respect to such Collateral, and every covenant and obligation contained in the
Loan Documents and necessary to the exercise or performance thereof by such
Supplemental Agent shall run to and be enforceable by either the Administrative
Agent or such Supplemental Agent, and (ii) the provisions of this Section 8
and of subsections 9.2 and 9.3 that refer to the
Administrative Agent shall inure to the benefit of such Supplemental Agent and
all

 

96

 

references
therein to the Administrative Agent shall be deemed to be references to the
Administrative Agent and/or such Supplemental Agent, as the context may
require.

 

Should any instrument in writing from the Borrowers be
required by any Supplemental Agent so appointed for more fully and certainly
vesting in and confirming to it such rights, powers, privileges and duties, the
Borrowers shall execute, acknowledge and deliver any and all such instruments
promptly upon request by such Supplemental Agent or the Administrative
Agent.  In case any Supplemental Agent,
or a successor thereto, shall resign or be removed, all the rights, powers,
privileges and duties of such Supplemental Agent, to the extent permitted by
law, shall vest in and be exercised by the Administrative Agent until the
appointment of a new Supplemental Agent.

 

8.2                                 Powers and Duties; General Immunity.

 

(A)                              Powers;
Duties Specified.  Each Lender
irrevocably authorizes Administrative Agent to take such action on such Lender’s
behalf and to exercise such powers, rights and remedies hereunder and under the
other Loan Documents as are specifically delegated or granted to the
Administrative Agent by the terms hereof and thereof, together with such
powers, rights and remedies as are reasonably incidental thereto.  The Administrative Agent shall have only
those duties and responsibilities that are expressly specified in this
Agreement and the other Loan Documents. 
The Administrative Agent may exercise such powers, rights and remedies
and perform such duties by or through its agents or employees.  The Administrative Agent shall not have, by
reason of this Agreement or any of the other Loan Documents, a fiduciary
relationship in respect of any Lender; and nothing in this Agreement or any of
the other Loan Documents, expressed or implied, is intended to or shall be so
construed as to impose upon Administrative Agent any obligations in respect of
this Agreement or any of the other Loan Documents except as expressly set forth
herein or therein.

 

(B)                                No
Responsibility for Certain Matters. 
The Administrative Agent shall not be responsible to any Lender for the
execution, effectiveness, genuineness, validity, enforceability, collectibility
or sufficiency of this Agreement or any other Loan Document or for any
representations, warranties, recitals or statements made herein or therein or
made in any written or oral statements or in any financial or other statements,
instruments, reports or certificates or any other documents furnished or made
by the Administrative Agent to Lenders or by or on behalf of the Borrowers or
any Lender and the transactions contemplated thereby or for the financial
condition or business affairs of the Borrowers or any other Person liable for
the payment of any Obligations, nor shall Administrative Agent be required to
ascertain or inquire as to the performance or observance of any of the terms,
conditions, provisions, covenants or agreements contained in any of the Loan
Documents or as to the use of the proceeds of the Loans or as to the existence
or possible existence of any Event of Default or Potential Event of
Default.  Anything contained in this
Agreement to the contrary notwithstanding, the Administrative Agent shall not
have any liability arising from confirmations of the amount of outstanding
Loans or the component amounts thereof.

 

(C)                                Exculpatory
Provisions.  Neither Administrative
Agent nor any of its officers, directors, employees or agents shall be liable
to Lenders for any action taken or omitted by the Administrative Agent under or
in connection with any of the Loan Documents except to the

 

97

 

extent caused by the Administrative Agent’s gross negligence or
willful misconduct.  The Administrative
Agent shall be entitled to refrain from any act or the taking of any action
(including the failure to take an action) in connection with this Agreement or
any of the other Loan Documents or from the exercise of any power, discretion
or authority vested in it hereunder or thereunder unless and until
Administrative Agent shall have received instructions in respect thereof from
Requisite Lenders (or such other Lenders as may be required to give such
instructions under subsection 9.6) and, upon receipt of such
instructions from Requisite Lenders (or such other Lenders, as the case may
be), the Administrative Agent shall be entitled to act or (where so instructed)
refrain from acting, or to exercise such power, discretion or authority, in
accordance with such instructions. 
Without prejudice to the generality of the foregoing, (i) Administrative
Agent shall be entitled to rely, and shall be fully protected in relying, upon
any communication, instrument or document believed by it to be genuine and
correct and to have been signed or sent by the proper Person or Persons, and
shall be entitled to rely and shall be protected in relying on opinions and
judgments of attorneys (who may be attorneys for the Borrowers and their
Subsidiaries), accountants, experts and other professional advisors selected by
it; and (ii) no Lender shall have any right of action whatsoever against
Administrative Agent as a result of the Administrative Agent acting or (where
so instructed) refraining from acting under this Agreement or any of the other
Loan Documents in accordance with the instructions of Requisite Lenders (or
such other Lenders as may be required to give such instructions under subsection
9.6).

 

(D)                               Administrative
Agent Entitled to Act as Lender.  The
agency hereby created shall in no way impair or affect any of the rights and
powers of, or impose any duties or obligations upon, the Administrative Agent
in its individual capacity as a Lender hereunder.  With respect to its participation in the
Loans, the Administrative Agent shall have the same rights and powers hereunder
as any other Lender and may exercise the same as though it were not performing
the duties and functions delegated to it hereunder, and the term “Lender” or “Lenders”
or any similar term shall, unless the context clearly otherwise indicates,
include Administrative Agent in its individual capacity.  The Administrative Agent and its Affiliates
may accept deposits from, lend money to and generally engage in any kind of
banking, trust, financial advisory or other business with the Borrowers or any
of its Affiliates as if it were not performing the duties specified herein, and
may accept fees and other consideration from the Borrowers for services in
connection with this Agreement and otherwise without having to account for the
same to Lenders.

 

(E)                                 Administrative
Agent Determinations.  To the
extent the Administrative Agent is entitled or required to make any
determinations under any intercreditor agreement, the Administrative Agent
shall make such determinations upon the advice of Requisite Lenders.

 

(F)                                 Delegation
of Duties. The Administrative Agent may perform any and all of its duties
and exercise its rights and powers under this Agreement or under any other Loan
Document by or through any one or more sub-agents appointed by the
Administrative Agent. The Administrative Agent and any such sub-agent may
perform any and all of its duties and exercise its rights and powers by or
through their respective Affiliates. The exculpatory, indemnification and other
provisions of this subsection 8.2 and of subsection 8.4 shall
apply to any Affiliates of the Administrative Agent and shall apply to their
respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as the Administrative
Agent. All of the rights, benefits, and privileges (including the exculpatory

 

98

 

and indemnification provisions) of this subsection 8.2 and of
subsection 8.4 shall apply to any such sub-agent and to the Affiliates
of any such sub-agent, and shall apply to their respective activities as
sub-agent as if such sub-agent and Affiliates were named herein.  Notwithstanding anything herein to the
contrary, with respect to each sub-agent appointed by the Administrative Agent,
(i) such sub-agent shall be a third party beneficiary under this Agreement with
respect to all such rights, benefits and privileges (including exculpatory
rights and rights to indemnification) and shall have all of the rights and
benefits of a third party beneficiary, including an independent right of action
to enforce such rights, benefits and privileges (including exculpatory rights
and rights to indemnification) directly, without the consent or joinder of any
other Person, against either or both of the Borrowers and the Lenders, (ii)
such rights, benefits and privileges (including exculpatory rights and rights
to indemnification) shall not be modified or amended without the consent of
such sub-agent, and (iii) such sub-agent shall only have obligations to the
Administrative Agent and not to either of the Borrowers, any Lender or any other
Person and neither of the Borrowers nor any Lender or any other Person shall
have any rights, directly or indirectly, as a third party beneficiary or
otherwise, against such sub-agent.

 

8.3                                 Representations and Warranties; No
Responsibility for Appraisal of Credit Worthiness.  Each Lender represents and warrants that it
has made its own independent investigation of the financial condition and
affairs of the Borrowers and their Subsidiaries in connection with the making
of the Loans and that it has made and shall continue to make its own appraisal
of the creditworthiness of the Borrowers and their Subsidiaries.  The Administrative Agent shall not have any
duty or responsibility, either initially or on a continuing basis, to make any
such investigation or any such appraisal on behalf of Lenders or to provide any
Lender with any credit or other information with respect thereto, whether
coming into its possession before the making of the Loans or at any time or
times thereafter, and the Administrative Agent shall not have any
responsibility with respect to the accuracy of or the completeness of any
information provided to Lenders.

 

8.4                                 Right to Indemnity.  Each Lender, in proportion to its Percentage,
severally agrees to indemnify Administrative Agent, to the extent that
Administrative Agent shall not have been reimbursed by the Borrowers, for and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses (including counsel fees and
disbursements) or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against Administrative Agent in exercising
its powers, rights and remedies or performing its duties hereunder or under the
other Loan Documents or otherwise in its capacity as Administrative Agent in
any way relating to or arising out of this Agreement or the other Loan
Documents; provided that no Lender shall be liable for any portion of
such liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from Administrative Agent’s
gross negligence or willful misconduct. 
If any indemnity furnished to the Administrative Agent for any purpose
shall, in the opinion of the Administrative Agent, be insufficient or become
impaired, the Administrative Agent may call for additional indemnity and cease,
or not commence, to do the acts indemnified against until such additional
indemnity is furnished.

 

8.5                                 Successor Administrative Agent.  The Administrative Agent may resign at any
time by giving 30 days’ prior written notice thereof to Lenders and the
Borrowers, and the Administrative Agent may be removed at any time with or
without cause by an instrument or

 

99

 

concurrent instruments in writing delivered to the Borrowers and the
Administrative Agent and signed by Requisite Lenders.  Upon any such notice of resignation or any
such removal, Requisite Lenders shall have the right, upon five Business Days’
notice to the Borrowers, to appoint a successor Administrative Agent (provided
that such successor is or simultaneously therewith becomes a Lender).  Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, that
successor Administrative Agent shall thereupon succeed to and become vested
with all the rights, powers, privileges and duties of the retiring or removed
Administrative Agent and the retiring or removed Administrative Agent shall be
discharged from its duties and obligations under this Agreement.  After any retiring or removed Administrative
Agent’s resignation or removal hereunder as Administrative Agent, the
provisions of this Section 8 shall inure to its benefit as to any
actions taken or omitted to be taken by it while it was Administrative Agent
under this Agreement.

 

8.6                                 Collateral Documents.  Each Lender hereby further authorizes the
Administrative Agent, on behalf of and for the benefit of Lenders, to enter
into each Collateral Document as secured party or beneficiary (as applicable),
and each Lender agrees to be bound by the terms of each Collateral Document; provided
that the Administrative Agent shall not (i) enter into or consent to any
material amendment, modification, termination or waiver of any provision contained
in any Collateral Document, or (ii) release any Collateral (except as otherwise
expressly permitted or required pursuant to the terms of this Agreement or the
applicable Collateral Document), in each case without the prior consent of
Requisite Lenders (or, if required pursuant to subsection 9.6, all
Lenders); provided  further, however, that, without further
written consent or authorization from Lenders, the Administrative Agent may
execute any documents or instruments necessary to release any Lien encumbering
any item of Collateral that is the subject of a sale or other disposition of
assets permitted by this Agreement or in connection with any Indebtedness
secured by a Permitted Lien or to which the Lenders have otherwise consented in
accordance with subsection 9.6. 
In connection with any disposition or release of any Collateral pursuant
to the terms of any Loan Document, at the Borrowers’ request and expense, the
Administrative Agent shall (without recourse and without any representation or
warranty) execute and deliver to the Borrowers such documents (including UCC-3
termination statements) as the Borrowers’ may reasonably request to evidence or
effect such disposition or release. Anything contained in any of the Loan
Documents to the contrary notwithstanding, the Borrowers, the Administrative
Agent and each Lender hereby agree that (X) no Lender shall have any right
individually to realize upon any of the Collateral under any Collateral
Document, it being understood and agreed that all powers, rights and remedies
under the Collateral Documents may be exercised solely by the Administrative
Agent for the benefit of Lenders in accordance with the terms thereof, and
(Y) in the event of a foreclosure by the Administrative Agent on any of
the Collateral pursuant to a public or private sale, the Administrative Agent
or any Lender may be the purchaser of any or all of such Collateral at any such
sale and the Administrative Agent, as agent for and representative of Lenders
(but not any Lender or Lenders in its or their respective individual capacities
unless Requisite Lenders shall otherwise agree in writing) shall be entitled,
for the purpose of bidding and making settlement or payment of the purchase
price for all or any portion of the Collateral sold at any such public sale, to
use and apply any of the Obligations as a credit on account of the purchase
price for any collateral payable by the Administrative Agent at such sale.

 

100

 

 

8.7                                 Disbursement Agreement.  Each Lender hereby further authorizes the
Administrative Agent, on behalf of and for the benefit of Lenders, to enter
into the Disbursement Agreement and each Lender agrees to be bound thereby; provided
that the Administrative Agent in its capacity as such hereunder shall not enter
into or consent to any amendment, modification, termination or waiver of any
provision contained in the Disbursement Agreement without the prior consent of
the Requisite Lenders (or, if such amendment, modification, termination or
waiver would result in a change that under subsection 9.6 would require
the consent of all Lenders, then the prior consent of all Lenders); and further
provided that, the Administrative Agent may waive the conditions set
forth in subsections 3.5.1 (solely with respect to any Project Document other
than the Cooperation Agreement), 3.5.2, 3.5.4 (other than as to any
certification regarding the satisfaction of a condition precedent set forth in
section 3.5 of the Disbursement Agreement, the waiver of which requires consent
of the Requisite Lenders), 3.5.5 (other than as to any certification regarding
the satisfaction of a condition precedent set forth in section 3.5 of the
Disbursement Agreement, the waiver of which requires consent of the Requisite
Lenders), 3.5.6, 3.5.8, 3.5.9, 3.5.10 or 3.5.13 of the Disbursement Agreement,
in each case, without obtaining the prior consent of the Requisite Lenders, so
long as (a) the waiver of such condition could not reasonably be expected, in
the reasonable judgment of the Administrative Agent, to have a materially
adverse effect on the Lenders, and (b) substantially concurrently with the
waiver of any such condition, the Administrative Agent shall deliver a notice
to each Lender advising of such waiver and setting forth the specific condition
being waived.

 

8.8                                 The Syndication Agent.  Sumitomo
Mitsui Banking Corporation, in its capacity as the Syndication Agent
hereunder (for so long as it is the Syndication Agent) and Scotia Capital, in
its capacity as the Arranger, shall not have any right, power, obligation,
liability, responsibility or duty under this Agreement (or any other Loan
Document) other than those applicable to it in its capacity as a Lender (to the
extent that it is a Lender hereunder). 
Without limiting the foregoing, Sumitomo Mitsui Banking Corporation, in
its capacity as the Syndication Agent and Scotia Capital, in its capacity as
the Arranger, does not assume and shall not be deemed to have assumed any
obligation towards or relationship of agency and trust with the Lenders or for
the Borrowers or any of their Subsidiaries.

 

9.                                       Miscellaneous.

 

9.1                                 Assignments and Participations in Loans.

 

(A)                              General.  Subject to subsection 9.1B, each
Lender shall have the right at any time to (i) sell, assign or transfer to
any Eligible Assignee, or (ii) sell participations to any Eligible
Assignee or any other Person (and in the case of any other Person, with the
approval of the Borrowers) in all or any part of its Commitments or any Loan or
Loans made by it or participations therein or any other interest herein or in
any other Obligations owed to it; provided that no such sale,
assignment, transfer or participation shall, without the consent of the
Borrowers, require the Borrowers to file a registration statement with the Securities
and Exchange Commission or apply to qualify such sale, assignment, transfer or
participation under the securities laws of any state; provided, further
that no such sale, assignment or transfer described in clause (i) above
shall be effective unless and until an Assignment Agreement effecting such
sale, assignment or transfer shall have been accepted by the Administrative
Agent and recorded in the Register as provided in subsection 9.1B(ii)
and provided, further that no such

 

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sale, assignment, transfer or any participation therein may be made
separately from a sale, assignment, transfer or participation of a
corresponding interest in the Commitment and the Loans of the Lender effecting
such sale, assignment, transfer or participation.  Except as otherwise provided in this subsection
9.1, no Lender shall, as between the Borrowers and such Lender, be relieved
of any of its obligations hereunder as a result of any sale, assignment or
transfer of, or any granting of participations in, all or any part of its
Commitments or the Loans or the other Obligations owed to such Lender.

 

(B)                                Assignments.

 

(i)                     Amounts
and Terms of Assignments.  Each
Commitment, Loan or participation therein, or other Obligation may in whole or
in part (a) be assigned, in any amount to another Lender, or to an
Affiliate of the assigning Lender or another Lender or an Approved Fund, or may
be pledged by a Lender in support of its obligations to such pledgee (without
releasing the pledging Lender from any of its obligations hereunder), or
(b) be assigned in an aggregate amount of not less than $1,000,000 (or
such lesser amount (i) if contemporaneous assignments approved by
Administrative Agent in its sole discretion aggregating not less than
$1,000,000 are being made by one or more Eligible Assignees which are
Affiliates or (ii) as shall constitute the aggregate amount of the Commitments,
Loans and participations therein, and other obligations of the assigning
Lender) to any Eligible Assignee, in each case, with the giving of notice to
the Borrowers and the Administrative Agent; provided that the assignee
shall represent that it has the financial resources to fulfill its commitments
hereunder and such assignment is consented to by the Administrative Agent (in
its sole discretion, not to be unreasonably withheld or delayed), and at any
time other than when an Event of Default has occurred and is continuing, such
assignee shall be acceptable to the Borrowers, such consent not to be unreasonably
withheld or delayed.  To the extent of
any such assignment in accordance with either clause (a) or (b)
above, the assigning Lender shall be relieved of its obligations with respect
to its Commitments, Loans or participations therein, or other Obligations or
the portion thereof so assigned.  The
assignor or assignee to each such assignment shall execute and deliver to the
Administrative Agent, for its acceptance and recording in the Register, an
Assignment Agreement, together with a processing and recordation fee of $3,500
in respect of each assignment; provided, that only one fee shall be
payable for simultaneous multiple assignments made by a Lender to or from its
Affiliates, and in each case such forms, certificates or other evidence, if
any, with respect to United States federal income tax withholding matters as
the assignee under such Assignment Agreement may be required to deliver to the
Administrative Agent pursuant to subsection 2.7B(iii)(a).  Upon such execution, delivery, acceptance and
recordation, from and after the Assignment Effective Date, (y) the
assignee thereunder shall be a party hereto and, to the extent that rights and
obligations hereunder have been assigned to it pursuant to such Assignment
Agreement, shall have the rights and obligations of a Lender hereunder and
(z) the assigning Lender thereunder shall, to the extent that rights and
obligations hereunder have been assigned by it pursuant to such Assignment
Agreement, relinquish its rights (other than any rights which survive the termination
of this Agreement under subsection 9.10B) and be released from its
obligations under this Agreement (and, in the case of an Assignment Agreement
covering all or the

 

102

 

remaining
portion of an assigning Lender’s rights and obligations under this Agreement,
such Lender shall cease to be a party hereto). 
The Commitments hereunder shall be modified to reflect the Commitment of
such assignee and any remaining Commitment of such assigning Lender and, if any
such assignment occurs after the issuance of Notes hereunder, the assigning
Lender shall, upon the effectiveness of such assignment or as promptly
thereafter as practicable, surrender its applicable Notes to the Administrative
Agent for cancellation, and thereupon new Notes shall be issued to the assignee
and to the assigning Lender, with appropriate insertions, to reflect the new
Commitments and/or outstanding Loans, as the case may be, of the assignee and
the assigning Lender.

 

(ii)                  Acceptance
by the Administrative Agent; Recordation in Register.  Upon its receipt of an Assignment Agreement
executed by an assigning Lender and an assignee representing that it is an
Eligible Assignee, together with the processing and recordation fee referred to
in subsection 9.1B(i) and any forms, certificates or other evidence with
respect to United States federal income tax withholding matters that such
assignee may be required to deliver to the Administrative Agent pursuant to subsection
2.7B(iii)(a), the Administrative Agent shall, if Administrative Agent has
consented to the assignment evidenced thereby (to the extent such consent is
required pursuant to subsection 9.1B(i)), (a) accept such
Assignment Agreement by executing a counterpart thereof as provided therein
(which acceptance shall evidence any required consent of the Administrative
Agent to such assignment), (b) record the information contained therein in
the Register (on the same Business Day as it is received if received by 12:00
noon and on the following Business Day if received after such time) and
(c) give prompt notice thereof to the Borrowers.  The Administrative Agent shall maintain a
copy of each Assignment Agreement delivered to and accepted by it as provided
in this subsection 9.1B(ii). 
The date of such execution of a counterpart or recordation of a transfer
shall be referred to herein as the “Assignment Effective Date.”

 

(C)                                Participations.  The holder of any participation, other than
an Affiliate or an Approved Fund of the Lender granting such participation,
shall not be entitled to require such Lender to take or omit to take any action
hereunder except action directly affecting (i) the extension of the
scheduled final maturity date of any Loan allocated to such participation,
(ii) a reduction of the principal amount of or the rate of interest
payable on any Loan allocated to such participation, or (iii) releasing
all or substantially all of the Collateral, and all amounts payable by the
Borrowers hereunder (including amounts payable to such Lender pursuant to subsections
2.6D and 2.7) shall be determined as if such Lender had not sold
such participation.  The Borrowers and
each Lender hereby acknowledge and agree that, solely for purposes of subsections
9.4 and 9.5, (a) any participation will give rise to a direct
obligation of the Borrowers to the participant and (b) the participant
shall be considered to be a “Lender”.

 

(D)                               Assignments
to Federal Reserve Banks and Trustees. 
In addition to the assignments and participations permitted under the
foregoing provisions of this subsection 9.1, (i) any Lender may
assign and pledge all or any portion of its Loans, the other Obligations owed
to such Lender, and its Notes to any Federal Reserve Bank as collateral
security pursuant to Regulation A of the Board of Governors of the Federal
Reserve System and any operating

 

103

 

circular issued by such Federal Reserve Bank or (ii) upon
notice to the Administrative Agent any Lender may pledge all or any portion of
its Loans, Commitments, the other Obligations owed to such Lender, and its
Notes, to its creditors or to its trustee in support of its obligations to such
creditor or trustee; provided that (i) no Lender shall, as between
the Borrowers and such Lender, be relieved of any of its obligations hereunder
as a result of any such assignment and pledge and (ii) in no event shall
such Federal Reserve Bank or such creditor or trustee be considered to be a “Lender”
or be entitled to require the assigning Lender to take or omit to take any
action hereunder.

 

(E)                                 Information.  Each Lender may furnish any information
concerning the Borrowers and their Subsidiaries in the possession of that
Lender from time to time to assignees and participants (including prospective
assignees and participants), subject to subsection 9.20.

 

(F)                                 Representations
of Lenders.  Each Lender listed on
the signature pages hereof succeeding to an interest in the Commitments and
Loans, as the case may be, hereby represents and warrants as of the Closing
Date or as of the applicable Assignment Effective Date that (i) it is an
Eligible Assignee described in clause (A) of the definition thereof;
(ii) it has experience and expertise in the making of loans such as the Loans;
and (iii) it will make its Loans for its own account in the ordinary course of
its business and without a view to distribution of such Loans within the
meaning of the Securities Act or the Exchange Act or other federal or state
securities laws (it being understood that, subject to the provisions of this
subsection 9.1, the disposition of such Loans or any interests therein
shall at all times remain within its exclusive control).  Each Lender that becomes a party hereto
pursuant to an Assignment Agreement shall be deemed to agree that the representations
and warranties of such Lender contained in Section 2(c) of such Assignment
Agreement are incorporated herein by this reference.

 

(G)                                Approval
Required By Nevada Gaming Laws. 
Notwithstanding anything to the contrary in this Section 9.1, the
rights of the Lenders to make assignments of, and grant participations in, any
or all of its Commitments or any interest therein, herein or in any other
Obligations owed to any such Lender, shall be subject to the approval of the
Nevada Gaming Authorities, to the extent required by the Nevada Gaming Laws.

 

9.2                                 Expenses. 
Whether or not the transactions contemplated hereby shall be
consummated, the Borrowers agree to pay promptly (i) all the actual and
reasonable costs and expenses of preparation of the Loan Documents and any
consents, amendments, waivers or other modifications thereto; (ii) all the
costs of furnishing all opinions by counsel for the Borrowers (including any
opinions requested by Lenders as to any legal matters arising hereunder) and of
the Borrowers’ performance of and compliance with all agreements and conditions
on its part to be performed or complied with under this Agreement and the other
Loan Documents including with respect to confirming compliance with
environmental, insurance and solvency requirements; (iii) the reasonable
fees, expenses and disbursements of counsel to the Administrative Agent in
connection with the negotiation, preparation, execution and administration of
the Loan Documents and the reasonable fees, expenses and disbursements of
counsel to the Administrative Agent in connection with any consents,
amendments, waivers or other modifications to any Loan Documents (whether or
not effective or executed) and any other documents or matters requested by the
Borrowers; (iv) all the actual costs and reasonable expenses of creating
and perfecting Liens in favor of the Administrative Agent on behalf of

 

104

 

Lenders pursuant to any Collateral Document, including filing and
recording fees, expenses and taxes, stamp or documentary taxes, search fees,
title insurance premiums, and reasonable fees, expenses and disbursements of
counsel to the Administrative Agent and of counsel providing any opinions that
Administrative Agent or Requisite Lenders may request in respect of the
Collateral Documents or the Liens created pursuant thereto; (v) all the
actual costs and reasonable expenses (including the reasonable fees, expenses
and disbursements of any auditors, accountants or appraisers and any environmental
or other consultants, advisors and agents employed or retained by the
Administrative Agent or its counsel) of obtaining and reviewing any appraisals
provided for under any Loan Documents, any environmental audits or reports
provided for under subsection 5.7B; (vi) the custody or
preservation of any of the Collateral; (vii) all other actual and
reasonable costs and expenses incurred by the Arranger in connection with the
syndication of the Commitments and the negotiation, preparation and execution
of the Loan Documents and any consents, amendments, waivers or other
modifications thereto and the transactions contemplated thereby; (viii) all
sums, costs and expenses under subsection 5.10D and (ix)after the
occurrence of an Event of Default, all costs and expenses, including reasonable
attorneys’ fees (including allocated costs of internal counsel) and costs of
settlement, incurred by the Administrative Agent and Lenders in enforcing any
Obligations of or in collecting any payments due from any Borrower hereunder or
under the other Loan Documents by reason of such Event of Default (including in
connection with the sale of, collection from, or other realization upon any of
the Collateral or the enforcement of any Loan Document) or in connection with any
refinancing or restructuring of the credit arrangements provided under this
Agreement in the nature of a “work-out” or pursuant to any insolvency or
bankruptcy proceedings.

 

9.3                                 Indemnity.  In
addition to the payment of expenses pursuant to subsection 9.2, whether
or not the transactions contemplated hereby shall be consummated, the Borrowers
agree to defend (subject to the Borrowers’ selection of counsel with the
consent of the Indemnitee, which shall not be unreasonably withheld),
indemnify, pay and hold harmless the Administrative Agent, the Syndication
Agent, the Arranger and Lenders, and the officers, directors, employees,
agents, sub-agents and affiliates of the Administrative Agent, the Syndication
Agent, the Arranger and Lenders (collectively called the “Indemnitees”),
from and against any and all Indemnified Liabilities; provided that the
Borrowers shall not have any obligation to any Indemnitee hereunder with
respect to any Indemnified Liabilities to the extent such Indemnified
Liabilities arise solely from the gross negligence or willful misconduct of
that Indemnitee as determined by a final judgment of a court of competent
jurisdiction.

 

As used herein, “Indemnified Liabilities” means,
collectively, any and all liabilities, obligations, losses, damages (including
natural resource damages), penalties, actions, judgments, suits, claims
(including Environmental Claims), costs (including the costs of any
investigation, study, sampling, testing, abatement, cleanup, removal,
remediation or other response action necessary to remove, remediate, clean up
or abate any Hazardous Materials Activity), expenses and disbursements of any
kind or nature whatsoever (including the reasonable fees and disbursements of
counsel for Indemnitees in connection with any investigative, administrative or
judicial proceeding commenced or threatened by any Person, whether or not any
such Indemnitee shall be designated as a party or a potential party thereto,
and any fees or expenses incurred by Indemnitees in enforcing this indemnity),
whether direct, indirect or consequential and whether based on any federal,
state or foreign laws, statutes, rules or regulations (including

 

105

 

securities
and commercial laws, statutes, rules or regulations and Environmental Laws), on
common law or equitable cause or on contract or otherwise, that may be imposed
on, incurred by, or asserted against any such Indemnitee, in any manner
relating to or arising out of (i) any Operative Documents or the transactions
contemplated hereby or thereby (including Lenders’ agreement to make the Loans
hereunder or the use or intended use of the proceeds thereof or the use or
intended use of any thereof, or any enforcement of any of the Loan Documents
(including any sale of, collection from, or other realization upon any of the
Collateral), (ii) the statements contained in the commitment letter delivered
by any Lender to the Borrowers with respect thereto, or (iii) any Environmental
Claim or any Hazardous Materials Activity relating to or arising from, directly
or indirectly, any past or present activity, operation, land ownership, or
practice of the Borrowers or any of their Subsidiaries.

 

To the extent that the undertakings to defend,
indemnify, pay and hold harmless set forth in this subsection 9.3 may be
unenforceable in whole or in part because they are violative of any law or
public policy, the Borrowers shall contribute the maximum portion that it is
permitted to pay and satisfy under applicable law to the payment and
satisfaction of all Indemnified Liabilities incurred by Indemnitees or any of
them.

 

9.4                                 Set-Off; Security Interest in Deposit
Accounts.  In addition to any rights
now or hereafter granted under applicable law and not by way of limitation of
any such rights, upon the occurrence and during the continuance of any Event of
Default each Lender is hereby authorized by the Borrowers at any time or from
time to time, without notice to the Borrowers or to any other Person, any such
notice being hereby expressly waived, to set off and to appropriate and to
apply any and all deposits (general or special, including Indebtedness
evidenced by certificates of deposit, whether matured or unmatured, but not
including trust accounts) and any other Indebtedness at any time held or owing
by that Lender to or for the credit or the account of the Borrowers against and
on account of the obligations and liabilities of the Borrowers to that Lender
under this Agreement and participations therein and the other Loan Documents, including
all claims of any nature or description arising out of or connected with this
Agreement and participations therein or any other Loan Document, irrespective
of whether or not (i) that Lender shall have made any demand hereunder or (ii)
the principal of or the interest on the Loans or any other amounts due
hereunder shall have become due and payable pursuant to Section 7
and although said obligations and liabilities, or any of them, may be
contingent or unmatured. The Borrowers hereby further grant to the
Administrative Agent and each Lender a security interest in all deposits and
accounts maintained with the Administrative Agent or such Lender as security
for the Obligations.

 

9.5                                 Ratable Sharing. 
The Lenders hereby agree among themselves that if any of them shall,
whether by voluntary payment (other than a voluntary prepayment of Loans made
and applied in accordance with the terms of this Agreement), by realization
upon security, through the exercise of any right of set-off or banker’s Lien,
by counterclaim or cross action or by the enforcement of any right under the
Loan Documents or otherwise, or as adequate protection of a deposit treated as
cash collateral under the Bankruptcy Code, receive payment or reduction of a
proportion of the aggregate amount of principal, interest, amounts payable in
respect of fees and other amounts then due and owing to that Lender hereunder
or under the other Loan Documents (collectively, the “Aggregate Amounts Due”
to such Lender) which is greater than the proportion received by any other
Lender in respect of the Aggregate Amounts Due to such other

 

106

 

Lender, then the Lender receiving such proportionately greater
payment shall (i) notify Administrative Agent and each other Lender of the
receipt of such payment and (ii) apply a portion of such payment to
purchase participations (which it shall be deemed to have purchased from each
seller of a participation simultaneously upon the receipt by such seller of its
portion of such payment) in the Aggregate Amounts Due to the other Lenders so
that all such recoveries of Aggregate Amounts Due shall be shared by all
Lenders in proportion to the Aggregate Amounts Due to them; provided
that if all or part of such proportionately greater payment received by such
purchasing Lender is thereafter recovered from such Lender upon the bankruptcy
or reorganization of the Borrowers or otherwise, those purchases shall be
rescinded and the purchase prices paid for such participations shall be returned
to such purchasing Lender ratably to the extent of such recovery, but without
interest.  The Borrowers expressly
consent to the foregoing arrangement and agree that any holder of a
participation so purchased may exercise any and all rights of banker’s Lien,
set-off or counterclaim with respect to any and all monies owing by the
Borrowers to that holder with respect thereto as fully as if that holder were
owed the amount of the participation held by that holder.

 

9.6                                 Amendments and Waivers.

 

(A)                              No
amendment, modification, termination or waiver of any provision of this
Agreement or of the Notes or other Loan Documents, and no consent to any
departure by the Borrowers therefrom, shall in any event be effective without
the written concurrence of Requisite Lenders (or the Syndication Agent or the
Administrative Agent only if this Agreement or such Loan Document expressly so
provides); provided that no amendment, modification, termination, waiver
or consent shall, unless approved in writing and signed by the Borrowers and
all the Lenders, do any of the following: 
reduce the principal of, or interest on, the Loans or any fees hereunder
(other than any waiver of any increase in the interest rate applicable to any
of the Loans pursuant to subsection 2.2E); unless expressly permitted by
any Loan Document, permit any Borrower to assign or delegate any of its rights
or Obligations under the Loan Documents; change in any manner the definition of
“Percentage”, “Pro Rata Share” or the definition of “Requisite Lenders” (it
being understood that, with the consent of Requisite Lenders, additional
extensions of credit pursuant to this Agreement may be included in “Percentage”,
“Pro Rata Share” and “Requisite Lenders” on substantially the same terms as the
Commitments and the Loans); change in any manner any provision of this
Agreement which, by its terms, expressly requires the approval or concurrence
of all Lenders; postpone any date fixed for the payment in respect of principal
of, or interest on, the Loans or any fees hereunder; release any Lien granted
in favor of the Administrative Agent with respect to 25% or more in aggregate
fair market value of the Collateral other than in accordance with the terms of
the Loan Documents (it being understood that the granting of additional Liens
on Collateral is not a release of a Lien on such Collateral); change in any
manner the provisions contained in subsections 7.1, 8.5 or 8.6;
provided, further that (i) any such amendment, modification,
termination, waiver or consent which increases the amount of the Commitment for
any Lender shall be effective only if evidenced by a writing signed by or on
behalf of such Lender and (ii) any release of Liens on Collateral granted to
the Administrative Agent with respect to less than 25% in aggregate fair market
value of the Collateral shall only require the consent of the Requisite Lenders
and the Administrative Agent.

 

107

 

(B)                                In
addition, (i) any amendment, modification, termination or waiver of any of
the provisions contained in Section 3 shall be effective only if
evidenced by a writing signed by or on behalf of the Administrative Agent and
Requisite Lenders, (ii) no amendment, modification, termination or waiver
of any provision of any Note shall be effective without the written concurrence
of the Lender which is the holder of that Note except that to the extent such
amendment, modification, termination or waiver would not otherwise require the
consent of all Lenders, only the holder of such Note or Notes up to the amount
constituting Requisite Lenders shall be required hereunder and (iii) no
amendment, modification, termination or waiver of any provision of Section 7
or of any other provision of this Agreement which, by its terms, expressly requires
the approval or concurrence of the Administrative Agent shall be effective
without the written concurrence of the Administrative Agent.

 

(C)                                Administrative
Agent may, but shall have no obligation to, with the concurrence of any Lender,
execute amendments, modifications, waivers or consents on behalf of that
Lender.  Any waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
it was given.  No notice to or demand on
the Borrowers in any case shall entitle the Borrowers to any other or further
notice or demand in similar or other circumstances.  Any amendment, modification, termination,
waiver or consent effected in accordance with this subsection 9.6 shall
be binding upon each Lender at the time outstanding, each future Lender and, if
signed by the Borrowers, on the Borrowers.

 

(D)                               Notwithstanding
the foregoing, if any Lender does not agree to any amendment hereunder, then
the Borrowers may, at their sole expense and effort, upon notice to such Lender
and the Administrative Agent, require such Lender to assign and delegate,
without recourse (in accordance with and subject to the restrictions contained
in subsection 9.1, including as a condition precedent to such
assignment, (i) Administrative Agent’s consent to the assignee unless not
otherwise required by subsection 9.1 and (ii) payment by the Borrowers
of the registration fee set forth in subsection 9.1B(i), if applicable, all
its interests, rights and obligations under this Agreement to an assignee that
shall assume such obligations (which assignee may be another Lender, if a
Lender accepts such assignment); provided that (i) such Lender shall
have received irrevocable payment in full in cash of an amount equal to the
outstanding principal of its Loans, accrued interest thereon, and accrued fees
and all other Obligations and other amounts payable to it hereunder (including
amounts payable pursuant to subsection 2.6D) from the assignee or the
Borrowers and (ii) such assignment (together with any other assignments
pursuant to this Section 9.6D or otherwise) will result in such amendment being
approved.

 

9.7                                 Certain Matters Affecting Lenders.

 

(A)                              If
(i) the Nevada Gaming Authority shall determine that any Lender does not meet
suitability standards prescribed under the Nevada Gaming Regulations or
(ii) any other gaming authority with jurisdiction over the gaming business
of LVSI and/or Venetian shall determine that any Lender does not meet its
suitability standards (in any such case, a “Former Lender”), the Administrative
Agent or the Borrowers shall have the right (but not the duty) to designate
bank(s) or other financial institution(s) (in each case, a “Substitute
Lender”) which may be any Lender or Lenders that agree to become a
Substitute Lender and to assume the rights and obligations of the Former
Lender, subject to receipt by the Administrative Agent of evidence that

 

108

 

such Substitute Lender is an Eligible Assignee.  The Substitute Lender shall assume the rights
and obligations of the Former Lender under this Agreement.  The Borrowers shall bear the costs and
expenses of any Lender required by the Nevada Gaming Authority, or any other
gaming authority with jurisdiction over the gaming business of LVSI and/or
Venetian, to file an application for a finding of suitability in connection
with the investigation of an application by LVSI and/or Venetian for a license
to operate a gaming establishment, in connection with such application for a
finding of suitability.

 

(B)                                Notwithstanding
the provisions of subsection 9.7(A), if any Lender becomes a Former
Lender, and if the Administrative Agent or the Borrowers fail to find a
Substitute Lender pursuant to subsection 9.7(A) within any time
period specified by the appropriate gaming authority for the withdrawal of a
Former Lender (the “Withdrawal Period”), the Borrowers shall immediately
prepay in full the outstanding principal amount of Loans made by such Former
Lender, together with accrued interest thereon to the earlier of (x) the
date of payment or (y) the last day of any Withdrawal Period.

 

9.8                                 Independence of Covenants.

 

All covenants hereunder shall be given independent
effect so that if a particular action or condition is not permitted by any of
such covenants, the fact that it would be permitted by an exception to, or
would otherwise be within the limitations of, another covenant shall not avoid
the occurrence of an Event of Default or Potential Event of Default if such
action is taken or condition exists.

 

9.9                                 Notices.

 

Unless otherwise specifically provided herein, any
notice or other communication herein required or permitted to be given shall be
in writing and may be personally served or sent by telefacsimile or United
States mail or courier service and shall be deemed to have been given when
delivered in person or by courier service, upon receipt of telefacsimile or
telex, or three Business Days after depositing it in the United States mail
with postage prepaid and properly addressed; provided that notices to
the Administrative Agent shall not be effective until received; provided
further, any such notice or other communication shall at the request of
the Administrative Agent be provided to any sub-agent appointed pursuant to subsection
8.2F hereto as designated by the Administrative Agent from time to
time.  For the purposes hereof, the
address of each party hereto shall be (i) as to the Borrowers and the
Administrative Agent, set forth under such party’s name on the signature pages
hereof or such other address as shall be designated by such Person in a written
notice delivered to the other parties hereto and (ii) as to each other
Lender, such other address as set forth on Schedule 2.1 or as shall be
designated by such party in a written notice delivered to the Administrative
Agent.

 

9.10                           Survival of Representations,
Warranties and Agreements.

 

(A)                              All
representations, warranties and agreements made herein shall survive the
execution and delivery of this Agreement and the making of the Loans hereunder.

 

(B)                                Notwithstanding
anything in this Agreement or implied by law to the contrary, the agreements of
the Borrowers (other than Phase II Mall Subsidiary after the Phase II Mall
Release

 

109

 

Date) set forth in subsections 2.6D, 2.7, 5.10D,
9.2, 9.3 and 9.4 and the agreements of Lenders set forth
in subsections 8.2C, 8.4, and 9.5 (other than as to Phase
II Mall Subsidiary after the Phase II Mall Release Date) and 9.20 shall survive
the payment of the Loans and the reimbursement of any amounts drawn thereunder,
and the termination of this Agreement.

 

9.11                           Failure or Indulgence Not Waiver;
Remedies Cumulative.

 

No failure or delay on the part of the Administrative
Agent or any Lender in the exercise of any power, right or privilege hereunder
or under any other Loan Document shall impair such power, right or privilege or
be construed to be a waiver of any default or acquiescence therein, nor shall
any single or partial exercise of any such power, right or privilege preclude other
or further exercise thereof or of any other power, right or privilege.  All rights and remedies existing under this
Agreement and the other Loan Documents are cumulative to, and not exclusive of,
any rights or remedies otherwise available.

 

9.12                           Marshalling; Payments Set Aside.

 

Neither Administrative Agent nor any Lender shall be
under any obligation to marshal any assets in favor of the Borrowers or any
other party or against or in payment of any or all of the Obligations.  To the extent that the Borrowers make a
payment or payments to the Administrative Agent or Lenders (or to the
Administrative Agent for the benefit of Lenders), or Administrative Agent or
Lenders enforce any security interests or exercise their rights of setoff, and
such payment or payments or the proceeds of such enforcement or setoff or any
part thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a trustee, receiver or
any other party under any bankruptcy law, any other state or federal law,
common law or any equitable cause, then, to the extent of such recovery, the
obligation or part thereof originally intended to be satisfied, and all Liens,
rights and remedies therefor or related thereto, shall be revived and continued
in full force and effect as if such payment or payments had not been made or
such enforcement or setoff had not occurred.

 

9.13                           Severability.

 

In case any provision in or obligation under this
Agreement or the Notes shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation in any other
jurisdiction, shall not in any way be affected or impaired thereby.

 

9.14                           Obligations Several; Independent Nature
of Lenders’ Rights.

 

The obligations of Lenders hereunder are several and no
Lender shall be responsible for the obligations or Commitments or
representations of any other Lender hereunder. 
Nothing contained herein or in any other Loan Document, and no action
taken by Lenders pursuant hereto or thereto, shall be deemed to constitute
Lenders as a partnership, an association, a joint venture or any other kind of
entity.  The amounts payable at any time
hereunder to each Lender shall be a separate and independent debt, and each
Lender shall be entitled to protect and enforce its rights arising out of this
Agreement, subject to the second sentence of subsection 8.6 and it shall
not be necessary for any Lender to be joined as an additional party in any
proceeding for such purpose.

 

110

 

9.15                           Headings.

 

Section and subsection headings in this Agreement
are included herein for convenience of reference only and shall not constitute
a part of this Agreement for any other purpose or be given any substantive
effect.

 

9.16                           Applicable Law.

 

THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION
5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD
TO CONFLICTS OF LAWS PRINCIPLES.

 

9.17                           Successors and Assigns.

 

This Agreement shall be binding upon the parties hereto
and their respective successors and assigns and shall inure to the benefit of
the parties hereto and the successors and assigns of Lenders (it being
understood that Lenders’ rights of assignment are subject to subsection 9.1).  Neither Borrowers’ rights or obligations
hereunder nor any interest therein may be assigned or delegated by the
Borrowers without the prior written consent of all Lenders.

 

9.18                           Consent to Jurisdiction and Service
of Process.

 

ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST BORROWERS
ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT, OR ANY
OBLIGATIONS THEREUNDER, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF
COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK.  BY EXECUTING AND DELIVERING THIS AGREEMENT,
BORROWERS, FOR THEMSELVES AND IN CONNECTION WITH THEIR PROPERTIES, IRREVOCABLY

 

(I)                                    ACCEPT
GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH
COURTS;

 

(II)                                WAIVE
ANY DEFENSE OF FORUM NON CONVENIENS;

 

(III)                            AGREE
THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE
MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE
BORROWERS AT THEIR ADDRESS PROVIDED IN ACCORDANCE WITH SUBSECTION 9.9;

 

(IV)                           AGREE
THAT SERVICE AS PROVIDED IN CLAUSE (III) ABOVE IS SUFFICIENT TO CONFER
PERSONAL JURISDICTION OVER BORROWERS IN ANY SUCH PROCEEDING IN ANY SUCH COURT,
AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT;

 

111

 

(V)                               AGREE
THAT LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY
LAW OR TO BRING PROCEEDINGS AGAINST BORROWERS IN THE COURTS OF ANY OTHER
JURISDICTION; AND

 

(VI)                           AGREE
THAT THE PROVISIONS OF THIS SUBSECTION 9.18 RELATING TO JURISDICTION AND
VENUE SHALL BE BINDING AND ENFORCEABLE TO THE FULLEST EXTENT PERMISSIBLE UNDER
NEW YORK GENERAL OBLIGATIONS LAW SECTION 5-1402 OR OTHERWISE.

 

9.19                           Waiver of Jury Trial.

 

EACH OF THE PARTIES TO THIS AGREEMENT HEREBY AGREES TO
WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION
BASED UPON OR ARISING OUT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS
OR ANY DEALINGS BETWEEN THEM RELATING TO THE SUBJECT MATTER OF THIS LOAN
TRANSACTION OR THE LENDER/BORROWER RELATIONSHIP THAT IS BEING ESTABLISHED.  The scope of this waiver is intended to be
all-encompassing of any and all disputes that may be filed in any court and
that relate to the subject matter of this transaction, including contract
claims, tort claims, breach of duty claims and all other common law and
statutory claims.  Each party hereto
acknowledges that this waiver is a material inducement to enter into a business
relationship, that each has already relied on this waiver in entering into this
Agreement, and that each will continue to rely on this waiver in their related
future dealings.  Each party hereto
further warrants and represents that it has reviewed this waiver with its legal
counsel and that it knowingly and voluntarily waives its jury trial rights
following consultation with legal counsel. 
THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY
REFERRING TO THIS SUBSECTION 9.19 AND EXECUTED BY EACH OF THE PARTIES
HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS,
SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT OR ANY OF THE OTHER LOAN
DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE
HEREUNDER.  In the event of litigation,
this Agreement may be filed as a written consent to a trial by the court.

 

9.20                           Confidentiality.

 

Each Lender shall hold all non-public information
obtained pursuant to the requirements of this Agreement in accordance with such
Lender’s customary procedures for handling confidential information of this
nature and in accordance with safe and sound banking or investment practices,
it being understood and agreed by the Borrowers that in any event a Lender may
make disclosures to Affiliates of such Lender or disclosures reasonably required
by any bona  fide assignee, transferee or participant in
connection with the contemplated assignment or transfer by such Lender of any
Loans or any participations therein (provided that such assignee, transferee or
participant agrees to also be bound by this subsection 9.20), or
disclosures required or requested by any governmental agency or representative
thereof or pursuant to legal process; provided that, unless specifically
prohibited by applicable law or court order, each Lender shall

 

112

 

notify
the Borrowers of any request by any Governmental Instrumentality or
representative thereof (other than any such request in connection with any
examination of the financial condition of such Lender by such governmental
agency) for disclosure of any such non-public information; and provided,
further that in no event shall any Lender be obligated or required to
return any materials furnished by the Borrowers or any of their
Subsidiaries.  For purposes of this
paragraph, “non-public information” shall not include information that is not
acquired from the Borrowers or any of their Subsidiaries or Affiliates (or
Persons acting on behalf of or retained by the Borrowers or any of their
Subsidiaries or Affiliates), Persons retained by or acting on behalf of the
Arranger, the Administrative Agent, the Syndication Agent and/or the Lenders in
connection with this Agreement and the transactions contemplated hereby or
Persons known by such Lender to be under an obligation of confidentiality to
the Borrowers (it being understood that the Arranger, the Administrative Agent,
the Syndication Agent, the Lenders and their respective Affiliates shall be
under an obligation of confidentiality).

 

9.21                           Counterparts; Effectiveness.

 

This Agreement and any amendments, waivers, consents or
supplements hereto or in connection herewith may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and
attached to a single counterpart so that all signature pages are physically attached
to the same document.  This Agreement
shall become effective as of the date hereof.

 

9.22                           USA Patriot Act.

 

Each Lender hereby
notifies the Borrowers that pursuant to the requirements of the USA Patriot Act
(Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “Patriot
Act”), it is required to obtain, verify and record information that
identifies the Borrowers, which information includes the names and addresses of
the Borrowers and other information that will allow such Lender to identify the
Borrowers in accordance with the Patriot Act.

 

9.23                           Electronic Execution of Assignments.

 

The words “execution,”
“signed,” “signature,” and words of like import in any Assignment Agreement
shall be deemed to include electronic signatures or the keeping of records in
electronic form, each of which shall be of the same legal effect, validity or
enforceability as a manually executed signature or the use of a paper-based
recordkeeping system, as the case may be, to the extent and as provided for in
any applicable law, including the Federal Electronic Signatures in Global and
National Commerce Act, the New York State Electronic Signatures and Records
Act, or any other similar state laws based on the Uniform Electronic
Transactions Act.

 

9.24                           Gaming Authorities.

 

The Administrative Agent and each Lender agree to
cooperate with the Nevada Gaming Authorities or any other applicable gaming
authority in connection with the administration of their regulatory
jurisdiction over the Borrowers and their Subsidiaries, including to the extent
not

 

113

 

inconsistent
with the internal policies of such Lender and any applicable legal or
regulatory restrictions the provision of such documents or other information as
may be requested by any such Nevada Gaming Authority or any other applicable
gaming authority relating to the Administrative Agent or any of the Lenders, or
the Borrowers or any of their Subsidiaries, or to the Loan Documents.  Notwithstanding any other provision of the
Agreement, the Borrowers expressly authorize the Administrative Agent and each
Lender to cooperate with the Nevada Gaming Authorities and such other gaming
authorities as described above.

 

114

 

IN WITNESS
WHEREOF, the parties hereto have caused this Agreement to be duly executed
and delivered by their respective officers thereunto duly authorized as of the
date first written above.

 

	
  BORROWER:

  	
   

  	
  PHASE II MALL HOLDING, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Lido Casino Resort Holding Company, LLC,

  its Manager

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  Lido Intermediate Holding Company,

  LLC, its managing member

  
	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  Venetian Casino Resort, LLC, its

  sole member

  
	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  Las Vegas Sands, Inc., its

  managing member

  
	
   

  
	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Harry Miltenberger

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  Harry Miltenberger

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  VP Finance, Secretary & Chief
  Accounting Officer

  

 

 

	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  3355 Las Vegas
  Boulevard South

  
	
   

  	
  Las Vegas, Nevada
  89109

  
	
   

  	
  Facsimile:   (702) 414-4421

  
	
   

  	
  Attention:   General Counsel

  
	
   

  	
   

  
	
   

  	
  With a copy to:

  
	
   

  	
   

  
	
   

  	
  Paul, Weiss, Rifkind, Wharton & Garrison LLP

  
	
   

  	
  1285 Avenue of the Americas

  
	
   

  	
  New York, New York 10019

  
	
   

  	
  Facsimile:  (212)
  492-0064

  
	
   

  	
  Attention:  Harris
  B. Freidus, Esq.

  

 

S-1

 

	
  BORROWER:

  	
   

  	
  PHASE II MALL
  SUBSIDIARY, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Phase II Mall Holding, LLC, its sole member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  Lido Casino Resort Holding Company,

  LLC, its Manager

  
	
   

  
	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  Lido Intermediate Holding

  Company, LLC, its managing

  member

  
	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  Venetian Casino Resort, LLC,

  its sole member

  
	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  Las Vegas Sands, Inc., its

  managing member

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  By:

  	
  /s/ Harry Miltenberger

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Name:

  	
  Harry Miltenberger

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  Title:

  	
  VP Finance, Secretary & Chief
  Accounting Officer

  

 

	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  3355 Las Vegas
  Boulevard South

  
	
   

  	
  Las Vegas, Nevada
  89109

  
	
   

  	
  Facsimile:  (702) 414-4421

  
	
   

  	
  Attention:  General Counsel

  
	
   

  	
   

  
	
   

  	
  With a copy to:

  
	
   

  	
   

  
	
   

  	
  Paul, Weiss, Rifkind, Wharton & Garrison LLP

  
	
   

  	
  1285 Avenue of the Americas

  
	
   

  	
  New York, New York 10019

  
	
   

  	
  Facsimile:  (212)
  492-0064

  
	
   

  	
  Attention:  Harris
  B. Freidus, Esq.

  

 

S-2

 

	 
	
  ADMINISTRATIVE AGENT

  AND LENDER:

  	
  THE BANK OF NOVA SCOTIA

  
	 
	
   

  	
   

  
	 
	
   

  	
  By:

  	
  /s/ Alan Pendergast

  	
   

  
	 
	
   

  	
   

  	
   

  	
  Name:

  	
  Alan Pendergast

  
	 
	
   

  	
   

  	
   

  	
  Title:

  	
  Managing Director

  
	 
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  	
   

  
	
   

  	
  The Bank of Nova
  Scotia

  	
   

  
	
   

  	
  580 California
  Street, 21st Floor

  
	
   

  	
  San Francisco,
  California 94104

  
	
   

  	
  Facsimile:   (415) 397-0791

  	
   

  
	
   

  	
  Attention:   Alan Pendergast

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  With a copy to:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  The Bank of Nova
  Scotia

  	
   

  
	
   

  	
  Loan Administration

  	
   

  
	
   

  	
  600 Peachtree Street,
  N.E.

  	
   

  
	
   

  	
  Atlanta, Georgia
  30308

  	
   

  
	
   

  	
  Facsimile:   (404) 888-8998

  	
   

  
	
   

  	
  Attention:   Hilda Gabbidon

  	
   

  
	
   

  	
   

  	
  Vicki Gibson

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  With a copy to:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Mayer, Brown, Rowe
  & Maw LLP

  
	
   

  	
  1675 Broadway

  	
   

  
	
   

  	
  New York, New York
  10019

  	
   

  
	
   

  	
  Facsimile:   (212) 849-5565

  	
   

  
	
   

  	
  Attention:   Douglas L. Wisner, Esq.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Lender’s Commitment:

  	
  $64,250,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Lender’s Percentage:

  	
  25.70%

  	
   

  
											

 

S-3

 

	
  SYNDICATION AGENT AND

  LENDER:

  	
  SUMITOMO MITSUI BANKING

  CORPORATION, NEW YORK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William M. Ginn

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  William M. Ginn

  
	
   

  	
   

  	
   

  	
  Title:

  	
  General Manager

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address for Notices:

  	 

	
   

  	
   

  	 

	
   

  	
  277 Park Avenue

  	 

	
   

  	
  New York, New York
  10172

  	 

	
   

  	
  Facsimile:   (212) 224-4391

  	 

	
   

  	
  Attention:   Charles J. Sullivan

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  Lender’s Commitment:

  	
  $64,250,000

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
  Lender’s Percentage:

  	
  25.70%

  	
   

  	 

										

 

S-4

 

	
  LENDER:

  	
  CHANG HWA COMMERCIAL BANK, LTD.,

  LOS ANGELES BRANCH

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jim Chen

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Jim
  Chen

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President and General Manager

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  333 South Grand
  Avenue, Suite 600

  
	
   

  	
  Los Angeles,
  California 90071

  
	
   

  	
  Facsimile:   (213) 620-7227

  
	
   

  	
  Attention:   Cecilia Huynh

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lender’s Commitment:

  	
  $20,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Lender’s Percentage:

  	
  8.00%

  	
   

  
								

 

S-5

 

	
  LENDER:

  	
  COMERICA BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Casey Ostrander

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Casey
  Ostrander

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address for Notices:

  	 

	
   

  	
   

  	 

	
   

  	
  500 Woodward Avenue,
  7th Floor

  	 

	
   

  	
  MC: 3256

  	 

	
   

  	
  Detroit, Michigan
  48226

  	 

	
   

  	
  Facsimile:   (313) 222-9295

  	 

	
   

  	
  Attention:   Casey Ostrander

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  Lender’s Commitment:

  	
  $20,000,000

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
  Lender’s Percentage:

  	
  8.00%

  	
   

  	 

									

 

S-6

 

	 
	
  LENDER:

  	
  HUA NAN COMMERCIAL BANK, LTD.

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	 
	
   

  	
  By:

  	
  /s/ David Cheng

  	
   

  
	 
	
   

  	
   

  	
   

  	
  Name:

  	
  David
  Cheng

  
	 
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President and
  General Manager

  
	 
	
   

  	
   

  	
   

  	
   

  	
   

  
	 
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  Hua Nan Commercial
  Bank, Ltd.

  
	
   

  	
  Los Angeles Branch

  
	
   

  	
  707 Wilshire
  Boulevard, #3100

  
	
   

  	
  Los Angeles,
  California 91006

  
	
   

  	
  Facsimile:   (213) 362-6617

  
	
   

  	
  Attention:   Howard Hung

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lender’s Commitment:

  	
  $4,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Lender’s Percentage:

  	
  1.60%

  	
   

  
									

 

S-7

 

	
  LENDER:

  	
  NEVADA STATE BANK

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ Derek Braybrooks

  	
   

  	 

	
   

  	
   

  	
   

  	
  Name:

  	
  Derek
  Braybrooks

  	 

	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President

  	 

	
   

  	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  750 East Warm Springs
  Road, Suite 400

  
	
   

  	
  Las Vegas, Nevada
  89119

  
	
   

  	
  Facsimile:   (702) 914-4537

  
	
   

  	
  Attention:   Derek Braybrooks

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lender’s Commitment:

  	
  $20,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Lender’s Percentage:

  	
  8.00%

  	
   

  
									

 

S-8

 

	
  LENDER:

  	
  OAK BROOK BANK

  	 

	
   

  	
   

  	 

	
   

  	
   

  	 

	
   

  	
  By:

  	
  /s/ Henry Wessel

  	
   

  	 

	
   

  	
   

  	
   

  	
  Name:

  	
  Henry
  Wessel

  	 

	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President

  	 

	
   

  	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	
   

  	
   

  	 

	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  1400 16th
  Street

  
	
   

  	
  Oak Brook, Illinois
  60523

  
	
   

  	
  Facsimile:   (630) 571-0256

  
	
   

  	
  Attention:   Henry Wessel

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lender’s Commitment:

  	
  $7,500,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Lender’s Percentage:

  	
  3.00%

  	
   

  
										

 

S-9

 

	
  LENDER:

  	
  STATE BANK OF INDIA, LOS ANGELES

  AGENCY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Soundara Kumar 

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Soundara
  Kumar 

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Executive Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  707 Wilshire
  Boulevard

  
	
   

  	
  Los Angeles,
  California 90017-3587

  
	
   

  	
  Facsimile:   (213) 622-2069

  
	
   

  	
  Attention:   Soundara Kumar

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lender’s Commitment:

  	
  $10,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Lender’s Percentage:

  	
  4.00%

  	
   

  
								

 

S-10

 

	
  LENDER:

  	
  TAIPEIBANK, LOS ANGELES BRANCH

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Herbert Y.H. Lai

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Herbert
  Y.H. Lai

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President and
  General Manager

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  700 South Flower
  Street, Suite 3300

  
	
   

  	
  Los Angeles,
  California 90017

  
	
   

  	
  Facsimile:   (213) 236-9155

  
	
   

  	
  Attention:   Pinkie Chen

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lender’s Commitment:

  	
  $10,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Lender’s Percentage:

  	
  4.00%

  	
   

  
									

 

S-11

 

	
  LENDER:

  	
  THE BANK OF EAST ASIA, LIMITED,

  NEW YORK BRANCH

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Stanley H. Kung

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Stanley
  H. Kung

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Senior Vice President and 

  
	
   

  	
   

  	
   

  	
   

  	
  Chief Lending Officer

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  202 Canal Street

  
	
   

  	
  New York, New York
  10013

  
	
   

  	
  Facsimile:   (212) 219-3211

  
	
   

  	
  Attention:   Stanley H. Kung

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lender’s Commitment:

  	
  $5,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Lender’s Percentage:

  	
  2.00%

  	
   

  
									

 

S-12

 

	
  LENDER:

  	
  THE FARMERS BANK OF CHINA

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Po-Chang Ho

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Po-Chang
  Ho

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President and
  General Manager

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  601 Figueroa Street,
  35th Floor

  
	
   

  	
  Los Angeles,
  California 90017

  
	
   

  	
  Facsimile:   (213) 489-5195

  
	
   

  	
  Attention:   Nancy Chung

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lender’s Commitment:

  	
  $10,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Lender’s Percentage:

  	
  4.00%

  	
   

  
									

 

S-13

 

	 
	
  LENDER:

  	
  THE INTERNATIONAL COMMERCIAL BANK OF
  CHINA, NEW YORK AGENCY

  
	 
	
   

  	
   

  
	 
	
   

  	
   

  
	 
	
   

  	
  By:

  	
  /s/ Nae-Yee Lung

  	
   

  
	 
	
   

  	
   

  	
   

  	
  Name:

  	
  Nae-Yee
  Lung

  
	 
	
   

  	
   

  	
   

  	
  Title:

  	
  SVP & General Manager

  
	 
	
   

  	
   

  	
   

  	
   

  	
   

  
	 
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address for Notices:

  
	
   

  	
   

  
	
   

  	
  65 Liberty Street

  
	
   

  	
  New York, New York
  10005

  
	
   

  	
  Facsimile:   (212) 766-5006

  
	
   

  	
  Attention:   M.S. Wu

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Lender’s Commitment:

  	
  $15,000,000

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Lender’s Percentage:

  	
  6.00%

  	
   

  
										

 

S-14Exhibit
4.1

 

EXECUTION
COPY

 

 

 

 

 

B&G FOODS, INC.

 

(f/k/a B&G FOODS HOLDINGS CORP.)

 

AND EACH OF THE GUARANTORS PARTY HERETO

 

12.0% SENIOR SUBORDINATED NOTES DUE 2016

 

 

INDENTURE

 

Dated as of October 14, 2004

 

 

The Bank of New York

 

Trustee

 

 

 

 

 

CROSS-REFERENCE TABLE*

 

	
  Trust Indenture

  Act Section

  	
   

  	
  Indenture Section

  
	
  310(a)(1)

  	
   

  	
  7.10

  
	
  (a)(2)

  	
   

  	
  7.10

  
	
  (a)(3)

  	
   

  	
  N.A.

  
	
  (a)(4)

  	
   

  	
  N.A.

  
	
  (a)(5)

  	
   

  	
  7.10

  
	
  (b)

  	
   

  	
  7.10

  
	
  (c)

  	
   

  	
  N.A.

  
	
  311(a)

  	
   

  	
  7.11

  
	
  (b)

  	
   

  	
  7.11

  
	
  (c)

  	
   

  	
  N.A.

  
	
  312(a)

  	
   

  	
  2.05

  
	
  (b)

  	
   

  	
  12.03

  
	
  (c)

  	
   

  	
  12.03

  
	
  313(a)

  	
   

  	
  7.06

  
	
  (b)

  	
   

  	
  7.06; 7.07

  
	
  (c)

  	
   

  	
  7.06; 12.02

  
	
  (d)

  	
   

  	
  7.06

  
	
  314(a)

  	
   

  	
  4.03; 12.02; 12.05

  
	
  (b)

  	
   

  	
  10.02

  
	
  (c)(1)

  	
   

  	
  12.04

  
	
  (c)(2)

  	
   

  	
  12.04

  
	
  (c)(3)

  	
   

  	
  N.A.

  
	
  (d)

  	
   

  	
  12.05

  
	
  (e)

  	
   

  	
  N.A.

  
	
  315(a)

  	
   

  	
  7.01

  
	
  (b)

  	
   

  	
  7.05; 12.02

  
	
  (c)

  	
   

  	
  7.01

  
	
  (d)

  	
   

  	
  7.01

  
	
  (e)

  	
   

  	
  6.11

  
	
  316(a) (last sentence)

  	
   

  	
  2.09

  
	
  (a)(1)(A)

  	
   

  	
  6.05

  
	
  (a)(1)(B)

  	
   

  	
  6.04

  
	
  (a)(2)

  	
   

  	
  N.A.

  

 

N.A. means not applicable.

*  This Cross-Reference Table is not part of the
Indenture.

 

i

 

TABLE OF CONTENTS

 

	
  ARTICLE 1

  DEFINITIONS AND INCORPORATION BY REFERENCE

  	
   

  
	
   

  	
   

  
	
  Section 1.01

  	
  Definitions.

  	
   

  
	
  Section 1.02

  	
  Other Definitions.

  	
   

  
	
  Section 1.03

  	
  Incorporation by Reference of
  Trust Indenture Act.

  	
   

  
	
  Section 1.04

  	
  Rules of Construction.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2

  THE NOTES

  	
   

  
	
   

  	
   

  
	
  Section 2.01

  	
  Form and Dating.

  	
   

  
	
  Section 2.02

  	
  Execution and Authentication.

  	
   

  
	
  Section 2.03

  	
  Registrar and Paying Agent.

  	
   

  
	
  Section 2.04

  	
  Paying Agent to Hold Money in Trust.

  	
   

  
	
  Section 2.05

  	
  Holder Lists.

  	
   

  
	
  Section 2.06

  	
  Transfer and Exchange.

  	
   

  
	
  Section 2.07

  	
  Replacement Notes.

  	
   

  
	
  Section 2.08

  	
  Outstanding Notes.

  	
   

  
	
  Section 2.09

  	
  Treasury Notes.

  	
   

  
	
  Section 2.10

  	
  Temporary Notes.

  	
   

  
	
  Section 2.11

  	
  Cancellation.

  	
   

  
	
  Section 2.12

  	
  Defaulted Interest.

  	
   

  
	
  Section
  2.13

  	
  Maturity.

  	
   

  
	
  Section
  2.14

  	
  Tax Treatment.

  	
   

  
	
  Section
  2.15

  	
  CUSIP Numbers.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3

  REDEMPTION AND PREPAYMENT

  	
   

  
	
   

  	
   

  
	
  Section 3.01

  	
  Notices to Trustee.

  	
   

  
	
  Section 3.02

  	
  Selection of Notes to Be Redeemed
  or Purchased.

  	
   

  
	
  Section 3.03

  	
  Notice of Redemption.

  	
   

  
	
  Section 3.04

  	
  Effect of Notice of Redemption.

  	
   

  
	
  Section 3.05

  	
  Deposit of Redemption or Purchase
  Price.

  	
   

  
	
  Section 3.06

  	
  Notes Redeemed or Purchased in Part.

  	
   

  
	
  Section 3.07

  	
  Optional Redemption.

  	
   

  
	
  Section 3.08

  	
  Mandatory Redemption.

  	
   

  
	
  Section 3.09

  	
  Offer to Purchase by Application
  of Excess Proceeds.

  	
   

  

 

ii

 

	
  ARTICLE 4

  COVENANTS

  	
   

  
	
   

  	
   

  
	
  Section
  4.01

  	
  Payment of
  Notes

  	
   

  
	
  Section
  4.02

  	
  Maintenance
  of Office or Agency

  	
   

  
	
  Section
  4.03

  	
  Reports

  	
   

  
	
  Section
  4.04

  	
  Compliance
  Certificate

  	
   

  
	
  Section
  4.05

  	
  Taxes

  	
   

  
	
  Section
  4.06

  	
  Stay,
  Extension and Usury Laws

  	
   

  
	
  Section
  4.07

  	
  Restricted
  Payments

  	
   

  
	
  Section 4.08

  	
  Dividend
  and Other Payment Restrictions Affecting Subsidiaries

  	
   

  
	
  Section
  4.09

  	
  Incurrence
  of Indebtedness and Issuance of Preferred Stock

  	
   

  
	
  Section
  4.10

  	
  Asset
  Sales.

  	
   

  
	
  Section
  4.11

  	
  Transactions
  with Affiliates

  	
   

  
	
  Section
  4.12

  	
  Liens

  	
   

  
	
  Section
  4.13

  	
  Business
  Activities

  	
   

  
	
  Section
  4.14

  	
  Corporate
  Existence

  	
   

  
	
  Section
  4.15

  	
  Offer to
  Repurchase Upon Change of Control

  	
   

  
	
  Section
  4.16

  	
  Limitation
  on Sale and Leaseback Transactions

  	
   

  
	
  Section
  4.17

  	
  Payments
  for Consent

  	
   

  
	
  Section
  4.18

  	
  Additional
  Note Guarantees

  	
   

  
	
  Section
  4.19

  	
  Designation
  of Restricted and Unrestricted Subsidiaries

  	
   

  
	
  Section 4.20

  	
  No Layering of Debt

  	
   

  
	
  Section
  4.21

  	
  Subsequent
  Issuances

  	
   

  
	
  Section 4.22

  	
  Combination of Notes and Class A Common
  Stock

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5

  SUCCESSORS

  	
   

  
	
   

  	
   

  
	
  Section
  5.01

  	
  Merger,
  Consolidation, or Sale of Assets.

  	
   

  
	
  Section
  5.02

  	
  Successor
  Corporation Substituted

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6

  DEFAULTS AND REMEDIES

  	
   

  
	
   

  	
   

  
	
  Section
  6.01

  	
  Events of
  Default

  	
   

  
	
  Section
  6.02

  	
  Acceleration

  	
   

  
	
  Section
  6.03

  	
  Other
  Remedies

  	
   

  
	
  Section
  6.04

  	
  Waiver of
  Past Defaults

  	
   

  
	
  Section
  6.05

  	
  Control
  by Majority

  	
   

  
	
  Section
  6.06

  	
  Limitation
  on Suits

  	
   

  
	
  Section
  6.07

  	
  Rights of
  Holders of Notes to Receive Payment

  	
   

  
	
  Section
  6.08

  	
  Collection
  Suit by Trustee

  	
   

  
	
  Section
  6.09

  	
  Trustee
  May File Proofs of Claim

  	
   

  

 

iii

 

	
  Section
  6.10

  	
  Priorities.

  	
   

  
	
  Section
  6.11

  	
  Undertaking
  for Costs.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE
  7

  TRUSTEE

  	
   

  
	
   

  	
   

  
	
  Section
  7.01

  	
  Duties of
  Trustee.

  	
   

  
	
  Section
  7.02

  	
  Rights of
  Trustee.

  	
   

  
	
  Section
  7.03

  	
  Individual
  Rights of Trustee.

  	
   

  
	
  Section
  7.04

  	
  Trustee’s
  Disclaimer.

  	
   

  
	
  Section
  7.05

  	
  Notice of
  Defaults.

  	
   

  
	
  Section
  7.06

  	
  Reports
  by Trustee to Holders of the Notes.

  	
   

  
	
  Section
  7.07

  	
  Compensation
  and Indemnity.

  	
   

  
	
  Section
  7.08

  	
  Replacement
  of Trustee.

  	
   

  
	
  Section
  7.09

  	
  Successor
  Trustee by Merger, etc.

  	
   

  
	
  Section
  7.10

  	
  Eligibility;
  Disqualification.

  	
   

  
	
  Section
  7.11

  	
  Preferential
  Collection of Claims Against Company.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8

  LEGAL DEFEASANCE AND COVENANT DEFEASANCE

  	
   

  
	
   

  	
   

  
	
  Section
  8.01

  	
  Option to
  Effect Legal Defeasance or Covenant Defeasance.

  	
   

  
	
  Section
  8.02

  	
  Legal
  Defeasance and Discharge.

  	
   

  
	
  Section
  8.03

  	
  Covenant
  Defeasance.

  	
   

  
	
  Section
  8.04

  	
  Conditions
  to Legal or Covenant Defeasance.

  	
   

  
	
  Section
  8.05

  	
  Deposited
  Money and Government Securities to be Held in Trust; Other Miscellaneous
  Provisions.

  	
   

  
	
  Section
  8.06

  	
  Repayment
  to Company.

  	
   

  
	
  Section
  8.07

  	
  Reinstatement.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 9

  AMENDMENT, SUPPLEMENT AND WAIVER

  	
   

  
	
   

  	
   

  
	
  Section
  9.01

  	
  Without
  Consent of Holders of Notes.

  	
   

  
	
  Section
  9.02

  	
  With
  Consent of Holders of Notes.

  	
   

  
	
  Section
  9.03

  	
  Compliance
  with Trust Indenture Act.

  	
   

  
	
  Section
  9.04

  	
  Revocation
  and Effect of Consents.

  	
   

  
	
  Section
  9.05

  	
  Notation
  on or Exchange of Notes.

  	
   

  
	
  Section
  9.06

  	
  Trustee
  to Sign Amendments, etc.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10

  SUBORDINATION

  	
   

  
	
   

  	
   

  
	
  Section
  10.01

  	
  Agreement
  to Subordinate.

  	
   

  

 

iv

 

	
  Section
  10.02

  	
  Liquidation;
  Dissolution; Bankruptcy.

  	
   

  
	
  Section
  10.03

  	
  Default
  on Designated Senior Indebtedness.

  	
   

  
	
  Section 10.04

  	
  Acceleration of Notes.

  	
   

  
	
  Section 10.05

  	
  When Distribution Must Be Paid Over.

  	
   

  
	
  Section 10.06

  	
  Notice by Company.

  	
   

  
	
  Section 10.07

  	
  Subrogation.

  	
   

  
	
  Section 10.08

  	
  Relative Rights.

  	
   

  
	
  Section 10.09

  	
  Subordination May Not Be Impaired by
  Company.

  	
   

  
	
  Section 10.10

  	
  Distribution or Notice to Representative.

  	
   

  
	
  Section 10.11

  	
  Rights of Trustee and Paying Agent.

  	
   

  
	
  Section 10.12

  	
  Authorization to Effect Subordination.

  	
   

  
	
  Section 10.13

  	
  Amendments.

  	
   

  
	
  Section 10.14

  	
  Reliance on Judicial Order or Certificate
  of Liquidating Agent.

  	
   

  
	
  Section 10.15

  	
  Trustee Not Fiduciary for Holders of
  Senior Indebtedness.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11

  NOTE GUARANTEES

  	
   

  
	
   

  	
   

  
	
  Section
  11.01

  	
  Guarantee.

  	
   

  
	
  Section
  11.02

  	
  Subordination
  of Note Guarantee.

  	
   

  
	
  Section
  11.03

  	
  Limitation
  on Guarantor Liability.

  	
   

  
	
  Section
  11.04

  	
  Execution
  and Delivery of Note Guarantee.

  	
   

  
	
  Section
  11.05

  	
  Guarantors
  May Consolidate, etc., on Certain Terms.

  	
   

  
	
  Section
  11.06

  	
  Releases.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 12

  SATISFACTION AND DISCHARGE

  	
   

  
	
   

  	
   

  
	
  Section
  12.01

  	
  Satisfaction
  and Discharge.

  	
   

  
	
  Section
  12.02

  	
  Application
  of Trust Money.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 13

  MISCELLANEOUS

  	
   

  
	
   

  	
   

  
	
  Section
  13.01

  	
  Trust
  Indenture Act Controls.

  	
   

  
	
  Section
  13.02

  	
  Notices.

  	
   

  
	
  Section
  13.03

  	
  Communication
  by Holders of Notes with Other Holders of Notes.

  	
   

  
	
  Section
  13.04

  	
  Certificate
  and Opinion as to Conditions Precedent.

  	
   

  
	
  Section
  13.05

  	
  Statements
  Required in Certificate or Opinion.

  	
   

  
	
  Section
  13.06

  	
  Rules
  by Trustee and Agents.

  	
   

  
	
  Section
  13.07

  	
  No
  Personal Liability of Directors, Officers, Employees and Stockholders.

  	
   

  
	
  Section
  13.08

  	
  Governing
  Law.

  	
   

  
	
  Section
  13.09

  	
  No
  Adverse Interpretation of Other Agreements.

  	
   

  

 

v

 

	
  Section
  13.10

  	
  Successors.

  	
   

  
	
  Section
  13.11

  	
  Severability.

  	
   

  
	
  Section
  13.12

  	
  Counterpart
  Originals.

  	
   

  
	
  Section
  13.13

  	
  Table of
  Contents, Headings, etc.

  	
   

  
	
  Section 13.14

  	
  Waiver of Jury Trial.

  	
   

  

 

EXHIBITS

 

	
  Exhibit A

  	
  FORM OF GLOBAL NOTE

  	
   

  
	
  Exhibit B

  	
  FORM OF NOTATION GUARANTEE

  	
   

  
	
  Exhibit C

  	
  FORM OF SUPPLEMENTAL INDENTURE

  	
   

  

 

vi

 

INDENTURE dated as of October 14, 2004 among B&G
Foods, Inc. (f/k/a B&G Foods Holdings Corp.), a Delaware corporation, the
Guarantors (as defined) and The Bank of New York, a New York banking
corporation, as trustee.

 

The Company, the Guarantors and the Trustee agree as
follows for the benefit of each other and for the equal and ratable benefit of
the Holders (as defined) of the  12.0% Senior
Subordinated Notes due 2016 (the “Notes”):

 

ARTICLE
1

DEFINITIONS AND INCORPORATION

BY REFERENCE

 

Section 1.01                                Definitions.

 

“Acquired
Debt” means, with respect to any specified Person:

 

(1)                                  Indebtedness
of any other Person existing at the time such other Person is merged with or
into or became a Subsidiary of such specified Person, whether or not such
Indebtedness is incurred in connection with, or in contemplation of, such other
Person merging with or into, or becoming a Restricted Subsidiary of, such
specified Person; and

 

(2)                                  Indebtedness
secured by a Lien encumbering any asset acquired by such specified Person.

 

provided that the amount of
Acquired Debt only at the time so acquired will include the accreted value
together with any interest thereon that is more than 30 days past due; provided, further, that Indebtedness of such other Person
that is redeemed, defeased, retired or otherwise repaid at the time, or
immediately upon consummation, of the Transaction by which such other Person is
merged with or into or became a Restricted Subsidiary of such Person will not
be Acquired Debt.

 

“Additional
Notes” means Notes (other than the Initial Notes) issued
under this Indenture in accordance with Sections 2.02 and 4.09 hereof, as part
of the same series as the Initial Notes.

 

“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 purposes of this definition, “control,”
as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that
beneficial ownership of 10% or more of the Voting Stock of a Person will be
deemed to be control.  For purposes

 

 

of this definition, the
terms “controlling,”  “controlled by” and “under common control with” have correlative meanings.

 

“Agent”
means any Registrar, co-registrar, Paying Agent or additional paying agent.

 

“Applicable
Procedures” means, with respect to any transfer or exchange
of or for beneficial interests in any Global Note, the rules and procedures of
the Depositary, Euroclear and Clearstream that apply to such transfer or
exchange.

 

“Asset Sale”
means

 

(1)                                  the
sale, lease, conveyance or other disposition of any assets or rights; provided that the sale, lease, conveyance or other
disposition of all or substantially all of the assets of the Company and its
Restricted Subsidiaries taken as a whole will be governed by Section 4.15
hereof and/or Section 5.01 hereof and not Section 4.10 hereof; and

 

(2)                                  the
issuance or sale of Equity Interests in any of the Company’s Restricted
Subsidiaries (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) or the sale of Equity Interests in any of its Subsidiaries.

 

Notwithstanding the
preceding, none of the following items will be deemed to be an Asset Sale:

 

(1)                                  any
single transaction or series of related transactions that involves
(a) assets having a Fair Market Value of less than $1.5 million or
(b) Net Proceeds of less than $1.5 million;

 

(2)                                  a
transfer of assets between or among the Company and its Restricted
Subsidiaries;

 

(3)                                  an
issuance of Equity Interests by a Restricted Subsidiary of the Company to the
Company or to a Restricted Subsidiary of the Company;

 

(4)                                  the
sale, lease, conveyance or other disposition of products, services, inventory,
equipment or accounts receivable in the ordinary course of business, including
any sale or other disposition of damaged, worn-out, obsolete, negligible or
surplus assets in the ordinary course of business;

 

(5)                                  the
sale or other disposition of cash or Cash Equivalents;

 

(6)                                  the
surrender or waiver of contract rights, the settlement, release or surrender of
contract, tort or other litigation claims in the ordinary course of

 

2

 

business, and the
granting of (or permitted realization of) Liens not prohibited by this
Indenture; and

 

(7)                                  a
Restricted Payment that complies with Section 4.07 hereof or a Permitted
Investment.

 

“Attributable
Debt” in respect of a sale and leaseback transaction means,
at the time of determination, the present value of the obligation of the lessee
for net rental payments during the remaining term of the lease included in such
sale and leaseback transaction including any period for which such lease has
been extended or may, at the option of the lessor, be extended.  Such present value shall be calculated using
a discount rate equal to the rate of interest implicit in such transaction,
determined in accordance with GAAP; provided, however,
that if such sale and leaseback transaction results in a Capital Lease
Obligation, the amount of Indebtedness represented thereby will be determined
in accordance with the definition of “Capital
Lease Obligation.”

 

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

 

“Beneficial Owner”
has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the
Exchange Act, except that in calculating the beneficial ownership of any
particular “person” (as that term is used in
Section 13(d)(3) of the Exchange Act), such “person” will
be deemed to have beneficial ownership of all securities that such “person”
has the right to acquire by conversion or exercise of other securities, whether
such right is currently exercisable or is exercisable only after the passage of
time.  The terms “Beneficially Owns” and “Beneficially
Owned” have a corresponding
meaning.

 

“Board of Directors”
means:

 

(1)                                  with
respect to a corporation, the board of directors of the corporation or any
committee thereof duly authorized to act on behalf of such board;

 

(2)                                  with
respect to a partnership, the board of directors of the general partner of the
partnership;

 

(3)                                  with
respect to a limited liability company, the managing member or members or any
controlling committee of managing members thereof; and

 

(4)                                  with
respect to any other Person, the board or committee of such Person serving a
similar function.

 

“Borrowing
Base” means, as of any date, an amount equal to:

 

3

 

(1)                                  85%
of the face amount of all accounts receivable owned by the Company and its
Restricted Subsidiaries as of the end of the most recent fiscal quarter
preceding such date that were not more than 90 days past due; plus

 

(2)                                  50%
of the book value of all inventory, net of reserves, owned by the Company and
its Restricted Subsidiaries as of the end of the most recent fiscal quarter
preceding such date,

 

in each case determined
in accordance with GAAP.

 

“BRS”
means Bruckmann, Rosser, Sherrill & Co. Inc.

 

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

 

“Capital
Lease Obligation” means, at the time any determination is to
be made, the amount of the liability in respect of a capital lease that would
at that time be required to be capitalized on a balance sheet prepared 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 prepaid by the lessee without payment
of a penalty.

 

“Capital
Stock” means:

 

(1)                                  in
the case of a corporation, corporate stock, including, without limitation,
corporate stock represented by EISs and corporate stock outstanding upon the
separation of EISs into the securities represented thereby;

 

(2)                                  in
the case of an association or business entity, any and all shares, interests,
participations, rights or other equivalents (however designated) of corporate
stock;

 

(3)                                  in
the case of a partnership or limited liability company, partnership interests
or membership interests (whether general or limited); and

 

(4)                                  any
other interest or participation that confers on a Person the right to receive a
share of the profits and losses of, or distributions of assets of, the issuing
Person, but excluding from all of the foregoing any debt securities convertible
into Capital Stock, whether or not such debt securities include any right of
participation with Capital Stock.

 

“Cash
Equivalents” means:

 

(1)                                  United
States dollars and Canadian dollars;

 

4

 

(2)                                  securities
issued or directly and fully guaranteed or insured by the United States
government or any agency or instrumentality of the United States government (provided that the full faith and credit of the United States
is pledged in support of those securities) having maturities of not more than
one year from the date of acquisition;

 

(3)                                  certificates
of deposit and eurodollar time deposits with maturities of six months or less
from the date of acquisition, bankers’ acceptances with maturities not
exceeding six months and overnight bank deposits, in each case, with any
domestic commercial bank having capital and surplus in excess of
$500.0 million and a Thomson Bank Watch Rating of “B”
or better;

 

(4)                                  repurchase
obligations with a term of not more than seven days for underlying securities
of the types described in clauses (2) and (3) above entered into with any
financial institution meeting the qualifications specified in clause (3) above;

 

(5)                                  commercial
paper having one of the two highest ratings obtainable from Moody’s Investors
Service, Inc. or Standard & Poor’s Rating Services and, in each case,
maturing within one year after the date of acquisition;

 

(6)                                  money
market funds at least 95% of the assets of which constitute Cash Equivalents of
the kinds described in clauses (1) through (5) of this definition; and

 

(7)                                  readily
marketable direct obligations issued by any State of the United States of
America or any political subdivision thereof having maturities of not more than
one year from the date of acquisition and having one of the two highest rating
categories obtainable from either Moody’s Investors Service, Inc. or Standard
& Poor’s Rating Services.

 

“Change
of Control” means the occurrence of any of the following:

 

(1)                                  the
direct or indirect sale, lease, transfer, conveyance or other disposition
(other than by way of merger or consolidation), in one or a series of related
transactions, of all or substantially all of the properties or assets of the
Company and its Subsidiaries taken as a whole to any “person” (as
that term is used in Section 13(d)(3) of the Exchange Act) other than a
Principal or a Related Party of a Principal;

 

(2)                                  the
adoption of a plan relating to the liquidation or dissolution of the Company;

 

5

 

(3)                                  the
consummation of any transaction (including, without limitation, any merger or
consolidation), the result of which is that any “person” (as
defined above), other than the Principals and their Related Parties, becomes
the Beneficial Owner, directly or indirectly, of more than 50% of the Voting
Stock of the Company, measured by voting power rather than number of shares; or

 

(4)                                  the
first day on which a majority of the members of the Board of Directors of the
Company are not Continuing Directors.

 

“Class A Common Stock”
means the Class A Common Stock of the Company, $.01 par value per share.

 

“Class B
Common Stock” means the Class B common stock of the
Company, $0.01 par value per share.

 

“Clearstream”
means Clearstream Banking, S.A.

 

“Company” means B&G Foods, Inc., and any and all
successors thereto.

 

“Consolidated
Cash Flow” means, with respect to any specified Person for
any period, the Consolidated Net Income of such Person for such period plus, without duplication:

 

(1)                                  an
amount equal to any extraordinary loss plus
any net loss realized by such Person or any of its Restricted Subsidiaries in
connection with an Asset Sale, to the extent such losses were deducted in computing
such Consolidated Net Income; plus

 

(2)                                  provision
for taxes based on income or profits of such Person and its Restricted
Subsidiaries for such period, to the extent that such provision for taxes was
deducted in computing such Consolidated Net Income; plus

 

(3)                                  the
Fixed Charges of such Person and its Restricted Subsidiaries for such period,
to the extent that such Fixed Charges were deducted in computing such
Consolidated Net Income; plus

 

(4)                                  depreciation,
amortization (including amortization of goodwill and other intangibles but
excluding amortization of prepaid cash expenses that were paid in a prior
period) and other non-cash expenses (excluding any such non-cash expense to the
extent that it represents an accrual of or reserve for cash expenses in any
future period or amortization of a prepaid cash expense that was paid in a
prior period and of such Person and its Restricted Subsidiaries for such period
including, without limitation, any Mark-to-Market Adjustment) of such Person

 

6

 

and its Restricted
Subsidiaries for such period to the extent that such depreciation, amortization
and other non-cash expenses were deducted in computing such Consolidated Net
Income; plus

 

(5)                                  if
such period includes the quarter ended September 27, 2003, $2.2 million; plus

 

(6)                                  fees
and expenses related to the Transactions not to exceed $12.0 million in
the aggregate actually incurred within three months of the date hereof; plus

 

(7)                                  charges
incurred within 180 days of the date hereof attributable to the write-off of
bond discount and the write-off of deferred financing fees and costs, relating
to the pay off of existing Indebtedness in an amount not to exceed $18.2
million; minus

 

(8)                                  non-cash
items increasing such Consolidated Net Income for such period (including,
without limitation, any Mark-to-Market Adjustment), other than the accrual of
revenue in the ordinary course of business,

 

in each case, on a consolidated basis and determined
in accordance with GAAP.

 

“Consolidated
Net Income” means, with respect to any specified Person for
any period, the aggregate of the Net Income of such Person and its Restricted
Subsidiaries for such period, on a consolidated basis, determined in accordance
with GAAP; provided that:

 

(1)                                  the
Net Income (but not loss) of any Person that is not a Restricted Subsidiary or
that is accounted for by the equity method of accounting will be included only
to the extent of the amount of dividends or similar distributions paid in cash
to the specified Person or a Restricted Subsidiary of the Person;

 

(2)                                  the
Net Income of any Restricted Subsidiary will be excluded to the extent that the
declaration or payment of dividends or similar distributions by that Restricted
Subsidiary of that Net Income to such Person and its Restricted Subsidiaries is
not at the date of determination permitted without any prior governmental
approval (that has not been obtained) or, directly or indirectly, by operation
of the terms of its charter or any agreement, instrument, judgment, decree,
order, statute, rule or governmental regulation applicable to that Restricted
Subsidiary or its stockholders; and

 

(3)                                  the
cumulative effect of a change in accounting principles will be excluded.

 

7

 

“Continuing
Directors” means, as of any date of determination, any member
of the Board of Directors of the Company who:

 

(1)                                  was
a member of such Board of Directors on the date of this Indenture; or

 

(2)                                  was
nominated for election or elected to such Board of Directors with the approval
of a majority of the Continuing Directors who were members of such Board of
Directors at the time of such nomination or election.

 

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

 

“Credit
Agreement” means that certain Credit Agreement, dated as of
October 14, 2004 by and among the Company, the Guarantors, Lehman Commercial
Paper, Inc., as administrative agent, and the lenders from time to time party
thereto, providing initially for up to $30.0 million of revolving credit
borrowings, including any related notes, Guarantees, collateral documents,
instruments and agreements executed in connection therewith, and, in each case,
as amended, restated, modified, renewed, refunded, replaced (whether upon or
after termination or otherwise) or refinanced (including by means of sales of
debt securities to institutional investors) in whole or in part from time to
time.

 

“Credit
Facilities” means, one or more debt facilities (including,
without limitation, the Credit Agreement) or commercial paper facilities, in
each case with banks or other lenders providing for revolving credit loans,
term loans, receivables financing (including through the sale of receivables to
such lenders or to special purpose entities formed to borrow from such lenders
against such receivables) or letters of credit, in each case, as amended,
restated, modified, renewed, refunded, replaced (whether upon or after
termination or otherwise) or refinanced (including by means of sales of debt
securities to institutional investors) in whole or in part from time to time
(whether upon or after termination or otherwise) or refinanced (including by
means of sales of debt securities to institutional investors) in whole or in
part from time to time.

 

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

 

“Default”
means any event that is, or with the passage of time or the giving of written
notice or both would be, an Event of Default.

 

“Definitive
Note” means a certificated Note registered in the name of the
Holder thereof and issued in accordance with Section 2.06 hereof, substantially
in the form of

 

8

 

Exhibit A hereto except
that such Note shall not bear the Global Note Legend and shall not have the “Schedule of Exchanges of Interests in the
Global Note” attached thereto.

 

“Depositary”
means, with respect to the Notes issuable or issued in whole or in part in
global form, the Person specified in Section 2.03 hereof as the Depositary
with respect to the Notes, and any and all successors thereto appointed as
depositary hereunder and having become such pursuant to the applicable
provision of this Indenture.

 

“Designated
Senior Indebtedness” means (i) the Indebtedness
represented by the Credit Facilities, (ii) the Senior Notes and
(iii) any other Senior Indebtedness so designated by the Company.

 

“Disqualified
Stock” means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible, or for which it is
exchangeable, in each case at the option of the holder of the Capital Stock),
or upon the happening of any event, matures or is mandatorily redeemable,
pursuant to a sinking fund obligation or otherwise, or redeemable at the option
of the holder of the Capital Stock, in whole or in part, on or prior to the
date that is 91 days after the date on which the Notes mature.  Notwithstanding the preceding sentence, any
Capital Stock that would constitute Disqualified Stock solely because the
holders of the Capital Stock have the right to require the Company to repurchase
such Capital Stock upon the occurrence of a change of control or an asset sale
will not constitute Disqualified Stock if the terms of such Capital Stock
provide that the Company may not repurchase or redeem any such Capital Stock
pursuant to such provisions unless such repurchase or redemption complies with
Section 4.07 hereof.  The amount of
Disqualified Stock deemed to be outstanding at any time for purposes of this
Indenture will be the maximum amount that the Company and its Restricted Subsidiaries
may become obligated to pay upon the maturity of, or pursuant to any mandatory
redemption provisions of, such Disqualified Stock, exclusive of accrued
dividends.

 

“Domestic
Subsidiaries” means any Restricted Subsidiary of the Company
that was formed under the laws of the United States or any state of the United
States or the District of Columbia or that guarantees or otherwise provides
direct credit support for any Indebtedness of the Company.

 

“Enhanced Income Securities”
or “EISs” means the units of the
Company comprised of Notes and Class A common stock.

 

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

 

“Euroclear”
means Euroclear Bank, S.A./N.V., as operator of the Euroclear system.

 

9

 

“Excess
Cash” means, with respect to any specified Person for any
period, the Consolidated Cash Flow of that Person for such period, minus the sum of the following, each
determined for such period on a consolidated basis:

 

(1)                                  cash
taxes paid for such Person and its Restricted Subsidiaries; plus

 

(2)                                  cash
interest expense paid by such person and its Restricted Subsidiaries, whether
or not capitalized (including, without limitation, the interest component of
all payments associated with Capital Lease Obligations, imputed interest with
respect to Attributable Debt, commissions, discounts and other fees and charges
incurred in respect of letter of credit or bankers’ acceptance financings, and
net of the effect of all payments made or received pursuant to Hedging
Obligations in respect of interest rates); plus

 

(3)                                  additions
to property, plant and equipment and other capital expenditures of such Person
and its Restricted Subsidiaries that are (or would be) set forth in a
consolidated statement of cash flows of such Person and its Restricted
Subsidiaries for such period prepared in accordance with GAAP, except to the
extent financed by the incurrence of Indebtedness; plus

 

(4)                                  the
aggregate principal amount of long-term Indebtedness repaid by such Person and
its Restricted Subsidiaries and the repayment by such Person and any Restricted
Subsidiary of any short-term Indebtedness that financed capital expenditures
referred to in clause (3) above, excluding any such repayments (a) under
working capital facilities (except to the extent that such Indebtedness so
repaid was incurred to finance capital expenditures as described in clause (3)
above, (b) out of Net Proceeds of Assets Sales as provided in Section 4.10
hereof and (c) through a refinancing involving the incurrence of new long-term
Indebtedness.

 

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

 

“Existing
Indebtedness” means Indebtedness of the Company and its
Restricted Subsidiaries (other than Indebtedness under the Credit Agreement and
the Senior Notes) in existence on the date hereof, reduced to the extent such
amounts are repaid, refinanced or retired.

 

“Fair
Market Value” means the value that would be paid by a willing
buyer to an unaffiliated willing seller in a transaction not involving distress
or necessity of either party, determined in good faith by the Board of
Directors of the Company (unless otherwise provided in this Indenture).

 

10

 

“First Four Dividend Payments”
means the dividend payments contemplated to be made by the Company to holders
of Class A Common Stock on January 30, 2005, April 30, 2005, July 30, 2005 and
October 30, 2005 for the partial quarterly dividend payment period ending
January 1, 2005 and the full quarterly dividend payment periods ending April 2,
2005, July 2, 2005 and October 1, 2005 provided that the dollar amount of
such quarterly dividend payments shall not be greater than $0.212 per share of
Class A Common Stock.

 

“Fixed
Charge Coverage Ratio” means with respect to any specified
Person for any period, the ratio of the Consolidated Cash Flow of such Person
for such period to the Fixed Charges of such Person for such period.  In the event that the specified Person or any
of its Restricted Subsidiaries incurs, assumes, guarantees, repays,
repurchases, redeems, defeases or otherwise discharges any Indebtedness (other
than ordinary working capital borrowings) or issues, repurchases or redeems
preferred stock subsequent to the commencement of the period for which the
Fixed Charge Coverage Ratio is being calculated and on or prior to the date on
which the event for which the calculation of the Fixed Charge Coverage Ratio is
made (the “Calculation
Date”), then the
Fixed Charge Coverage Ratio will be calculated giving pro forma effect to such
incurrence, assumption, Guarantee, repayment, repurchase, redemption,
defeasance or other discharge of Indebtedness, or such issuance, repurchase or
redemption of preferred stock, and the use of the proceeds therefrom, as if the
same had occurred at the beginning of the applicable four-quarter reference
period.

 

In addition, for
purposes of calculating the Fixed Charge Coverage Ratio:

 

(1)                                  acquisitions
that have been made by the specified Person or any of its Restricted
Subsidiaries, including through mergers or consolidations, or any Person or any
of its Restricted Subsidiaries acquired by the specified Person or any of its
Restricted Subsidiaries, and including any related financing transactions and
including increases in ownership of Restricted Subsidiaries, during the
four-quarter reference period or subsequent to such reference period and on or
prior to the Calculation Date will be given pro forma effect as if they had
occurred on the first day of the four-quarter reference period, and
Consolidated Cash Flow for such reference period will be calculated on a pro
forma basis in accordance with Regulation S-X under the Securities Act;

 

(2)                                  the
Consolidated Cash Flow attributable to discontinued operations, as determined
in accordance with GAAP, and operations or businesses (and ownership interests
therein) disposed of prior to the Calculation Date, will be excluded;

 

(3)                                  the
Fixed Charges attributable to discontinued operations, as determined in
accordance with GAAP, and operations or businesses (and ownership interests
therein) disposed of prior to the Calculation Date, will be

 

11

 

excluded, but only to the
extent that the obligations giving rise to such Fixed Charges will not be
obligations of the specified Person or any of its Restricted Subsidiaries
following the Calculation Date;

 

(4)                                  any
Person that is a Restricted Subsidiary on the Calculation Date will be deemed
to have been a Restricted Subsidiary at all times during such four-quarter
period;

 

(5)                                  any
Person that is not a Restricted Subsidiary on the Calculation Date will be
deemed not to have been a Restricted Subsidiary at any time during such
four-quarter period; and

 

(6)                                  if
any Indebtedness bears a floating rate of interest, the interest expense on
such Indebtedness will be calculated as if the rate in effect on the
Calculation Date had been the applicable rate for the entire period (taking
into account any Hedging Obligation applicable to such Indebtedness if such
Hedging Obligation has a remaining term as at the Calculation Date in excess of
12 months).

 

“Fixed Charges”
means, with respect to any specified Person for any period, the sum, without
duplication, of:

 

(1)                                  the
consolidated interest expense of such Person and its Restricted Subsidiaries
for such period, whether paid or accrued, including, without limitation,
amortization of debt issuance costs and original issue discount, non-cash
interest payments, the interest component of any deferred payment obligations,
the interest component of all payments associated with Capital Lease
Obligations, imputed interest with respect to Attributable Debt, commissions,
discounts and other fees and charges incurred in respect of letter of credit or
bankers’ acceptance financings, and net of the effect of all payments made or
received pursuant to Hedging Obligations in respect of interest rates; plus

 

(2)                                  the
consolidated interest expense of such Person and its Restricted Subsidiaries
that was capitalized during such period; plus

 

(3)                                  any
interest on Indebtedness of another Person that is guaranteed by such Person or
one of its Restricted Subsidiaries or secured by a Lien on assets of such Person
or one of its Restricted Subsidiaries, whether or not such Guarantee or Lien is
called upon; plus

 

(4)                                  the
product of (a) all dividends, whether paid or accrued and whether or not
in cash, on any series of preferred stock of such Person or any of its Restricted
Subsidiaries, other than dividends on Equity Interests payable solely in Equity
Interests of the Company (other than Disqualified Stock) or to the

 

12

 

Company or a Restricted
Subsidiary of the Company, times
(b) a fraction, the numerator of which is one and the denominator of which
is one minus the then current combined federal, state and local statutory tax
rate of such Person, expressed as a decimal, in each case, determined on a
consolidated basis in accordance with GAAP; minus

 

(5)                                  charges
attributable to the amortization of expenses relating to the Transactions
incurred within 180 days of the date of this Indenture; minus

 

(6)                                  charges
incurred within 180 days of the date hereof attributable to the write-off of
bond discount and the write-off of deferred financing fees and costs relating
to the pay off of existing Indebtedness in an amount not to exceed
$18.2 million.

 

“GAAP”
means generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such other entity as
have been approved by a significant segment of the accounting profession in the
United States, which are in effect on the date of this Indenture.

 

“Global
Note Legend” means the legend set forth in
Section 2.06(f)(1) hereof, which is required to be placed on all Global Notes
issued under this Indenture.

 

“Global
Notes” means, individually and collectively, each of the
Global Notes deposited with or on behalf of and registered in the name of the
Depository or its nominee, substantially in the form of Exhibit A hereto and that
bears the Global Note Legend and that has the “Schedule
of Exchanges of Interests in the Global Note”
attached thereto, issued in accordance with Section 2.01, 2.06(b) or
2.06(d) hereof.

 

“Government
Securities” means direct obligations of, or obligations
guaranteed by, the United States of America, and the payment for which the
United States pledges its full faith and credit.

 

“Guarantee”
means a guarantee other than by endorsement of negotiable instruments for
collection or standard contractual indemnities in the ordinary course of
business, direct or indirect, in any manner including, without limitation, by
way of a pledge of assets or through letters of credit or reimbursement
agreements in respect thereof, of all or any part of any Indebtedness (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).

 

“Guarantors”
means each of:

 

13

 

(1)                                  BGH
Holdings, Inc., Bloch & Guggenheimer, Inc., Heritage Acquisition Corp.,
Maple Grove Farms of Vermont, Inc., Ortega Holdings Inc., Polaner, Inc.,
Trappey’s Fine Foods, Inc. and William Underwood Company; and

 

(2)                                  any
other Subsidiary of the Company that executes a Note Guarantee in accordance
with the provisions of this Indenture,

 

and their respective successors and assigns, in each
case, until the Note Guarantee of such Person has been released in accordance
with the provisions of this Indenture.

 

“Hedging
Obligations” means, with respect to any specified Person, the
obligations of such Person under:

 

(1)                                  interest
rate swap agreements (whether from fixed to floating or from floating to
fixed), interest rate cap agreements and interest rate collar agreements;

 

(2)                                  other
agreements or arrangements designed to manage interest rates or interest rate
risk; and

 

(3)                                  other
agreements or arrangements designed to protect such Person against fluctuations
in currency exchange rates or commodity prices.

 

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

 

“Immaterial Subsidiary”
means, as of any date, any Restricted Subsidiary whose total assets, as of that
date, are less than $100,000 and whose total revenues for the most recent
12-month period do not exceed $100,000; provided that a
Restricted Subsidiary will not be considered to be an Immaterial Subsidiary if
it, directly or indirectly, guarantees or otherwise provides direct credit
support for any Indebtedness of the Company.

 

“Indebtedness”
means, with respect to any specified Person, any indebtedness of such Person
(excluding accrued expenses and trade payables), whether or not contingent:

 

(1)                                  in
respect of borrowed money;

 

(2)                                  evidenced
by bonds, notes, debentures or similar instruments or letters of credit (or
reimbursement agreements in respect thereof);

 

(3)                                  in
respect of banker’s acceptances;

 

(4)                                  representing
Capital Lease Obligations or Attributable Debt in respect of sale and leaseback
transactions;

 

14

 

(5)                                  representing
the balance deferred and unpaid of the purchase price of any property or
services, which purchase price is due more than six months after the date of
placing such property in service or taking delivery and title thereto, except
any such balance that constitutes an accrued expense or trade payable or any
similar obligation to trade creditors; or

 

(6)                                  representing
any Hedging Obligations,

 

if and to the extent any of the preceding items (other
than letters of credit, Attributable Debt and Hedging Obligations) would appear
as a liability upon a balance sheet of the specified Person prepared in
accordance with GAAP.  In addition, the
term “Indebtedness” includes all Indebtedness of others
secured by a Lien on any asset of the specified Person (whether or not such
Indebtedness is assumed by the specified Person; provided
that if the holder of such Indebtedness has no recourse to such Person other
than to the asset, the amount of such Indebtedness will be deemed to be equal
to the lesser of the value of such asset and the amount of the obligation so
secured) and, to the extent not otherwise included, the Guarantee by the
specified Person of any Indebtedness of any other Person.

 

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

 

“Indirect
Participant” means a Person who holds a beneficial interest
in a Global Note through a Participant.

 

“Initial
Notes” means the first $147.1 million aggregate principal
amount of Notes issued under this Indenture, or $165.8 million if the
over-allotment option is exercised in full, on the date hereof.

 

“Investments”
means, with respect to any Person, all direct or indirect investments by such
Person in other Persons (including Affiliates) in the forms of loans (including
Guarantees or other obligations), advances or capital contributions (excluding
accounts receivable, trade credit and advances to customers in the ordinary
course of business and commission, travel and similar advances to officers and
employees made in the ordinary course of business), purchases or other
acquisitions for consideration of Indebtedness, Equity Interests or other
securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP.  If the Company or any Subsidiary of the
Company sells or otherwise disposes of any Equity Interests of any direct or
indirect Subsidiary of the Company such that, after giving effect to any such
sale or disposition, such Person is no longer a Subsidiary of the Company, the
Company will be deemed to have made an Investment on the date of any such sale
or disposition equal to the Fair Market Value of the Company’ Investments in
such Subsidiary that were not sold or disposed of in an amount determined as
provided in Section 4.07(d) hereof. 
The acquisition by the Company or any Subsidiary of the

 

15

 

Company of a Person that
holds an Investment in a third Person will not be deemed to be an Investment by
the Company or such Subsidiary in such third Person if the purpose of such
acquisition by the Company or such Subsidiary was not the Investment in such
third Person.  Except as otherwise provided
in this Indenture, the amount of an Investment will be determined at the time
the Investment is made and without giving effect to subsequent changes in
value.

 

“Joint Venture”
means any joint venture between the Company and/or any Restricted Subsidiary
and any other Person if such joint venture is:

 

(1)                                  owned
50% or less by the Company and/or any of its Restricted Subsidiaries; and

 

(2)                                  not
directly or indirectly controlled by or under direct or indirect common control
of the Company and/or any of its Restricted Subsidiaries.

 

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

 

“Lien”
means, with respect to any asset, any mortgage, lien, pledge, charge, security
interest or encumbrance of any kind in respect of such asset, whether or not
filed, recorded or otherwise perfected under applicable law, including any
conditional sale or other title retention agreement, any lease in the nature
thereof, any option or other agreement to sell or give a security interest in
and any filing of or agreement to give any financing statement relating to a
lien on an asset under the Uniform Commercial Code (or equivalent statutes) of
any jurisdiction.

 

“Mark-to-Market Adjustment”
means any non-cash expense or income resulting from current or future
mark-to-market accounting that the Company may apply with respect to any EISs,
shares of Class A common stock, shares of Class B common stock or the senior
subordinated notes issued in connection with the Transactions or at any time
thereafter.

 

“Net Cash Balance”
means, with respect to any specified Person for any fiscal period end, the
amount of cash and cash equivalents set forth on such Person’s balance sheet as
of such period end minus the amount of any funded Indebtedness of such Person
outstanding under any secured revolving credit facilities.

 

16

 

“Net
Income” means, with respect to any specified Person, the net
income (loss) of such Person, determined in accordance with GAAP and before any
reduction in respect of preferred stock dividends, excluding, however:

 

(1)                                  any
gain (or loss), together with any related provision for taxes on such gain (or
loss), realized in connection with:

 

(a)                                  any
Asset Sale; or

 

(b)                                 the
disposition of any securities by such Person or any of its Restricted
Subsidiaries or the extinguishment of any Indebtedness of such Person or any of
its Restricted Subsidiaries; and

 

(2)                                  any
extraordinary gain (or loss), together with any related provision for taxes on
such extraordinary gain (but not loss).

 

“Net
Proceeds” means the aggregate cash proceeds received by the
Company or any of its Restricted Subsidiaries in respect of any Asset Sale
(including, without limitation, any cash received upon the sale or other
disposition of any non-cash consideration received in any Asset Sale), net of
the direct costs relating to such Asset Sale, including, without limitation,
legal, accounting and investment banking fees, and sales commissions, and any
relocation expenses incurred as a result of the Asset Sale, taxes paid or
payable as a result of the Asset Sale, in each case, after taking into account
any available tax credits or deductions and any tax sharing arrangements, and
amounts required to be applied to the repayment of Indebtedness, other than
Senior Indebtedness, secured by a Lien on the asset or assets that were the
subject of such Asset Sale and any reserve for adjustment in respect of the
sale price of such asset or assets established in accordance with GAAP.

 

“Non-Recourse Debt”
means Indebtedness:

 

(1)                                  as
to which neither the Company nor any of its Restricted Subsidiaries
(a) provides credit support of any kind (including any undertaking,
agreement or instrument that would constitute Indebtedness), (b) is
directly or indirectly liable as a guarantor or otherwise, or
(c) constitutes the lender;

 

(2)                                  no
default with respect to which (including any rights that the holders of the
Indebtedness may have to take enforcement action against an Unrestricted
Subsidiary) would permit upon notice, lapse of time or both any holder of any
other Indebtedness of the Company or any of its Restricted Subsidiaries to
declare a default on such other Indebtedness or cause the payment of the
Indebtedness to be accelerated or payable prior to its Stated Maturity; and

 

17

 

(3)                                  as
to which the lenders have been notified in writing that they will not have any
recourse to the stock or assets of the Company or any of its Restricted
Subsidiaries.

 

“Non-U.S.
Person” means a Person who is not a U.S. Person.

 

“Note
Guarantee” means the Guarantee by each Guarantor of the
Company’s obligations under this Indenture and the Notes, executed pursuant to
the provisions of this Indenture.

 

“Notes”
has the meaning assigned to it in the preamble to this Indenture.  The Initial Notes and the Additional Notes
shall be treated as a single class for all purposes under this Indenture, and
unless the context otherwise requires, all references to the Notes shall
include the Initial Notes and any Additional Notes.

 

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

 

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

 

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

 

“Opinion
of Counsel” means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of
Section 13.05 hereof.  The counsel may
be an employee of or counsel to the Company, any Subsidiary of the Company or
the Trustee.

 

“pari passu Indebtedness” means (i) with respect
to the Company, the Notes and any other senior subordinated Indebtedness of the
Company, other than Senior Indebtedness or secured Indebtedness of the Company
and (ii) with respect to any Guarantor, its Note Guarantee and any other
senior subordinated Indebtedness of such Guarantor, other than Senior
Indebtedness or secured Indebtedness of such Guarantor.

 

“Participant”
means, with respect to the Depositary, Euroclear or Clearstream, a Person who
has an account with the Depositary, Euroclear or Clearstream, respectively
(and, with respect to DTC, shall include Euroclear and Clearstream).

 

18

 

“Permitted
Business” means the business of the Company and its
Subsidiaries as existing on the date hereof and any other businesses that are
the same, similar or reasonably related, ancillary or complementary thereto and
reasonable extensions thereof.

 

“Permitted Investments”
means:

 

(1)                                  any
Investment in the Company or in a Restricted Subsidiary of the Company;

 

(2)                                  any
Investment in Cash Equivalents;

 

(3)                                  any
Investment by the Company or any Restricted Subsidiary of the Company in a
Person, if as a result of such Investment:

 

(a)                                  such
Person becomes a Restricted Subsidiary of the Company; or

 

(b)                                 such
Person is merged, consolidated or amalgamated with or into, or transfers or
conveys substantially all of its assets to, or is liquidated into, the Company
or a Restricted Subsidiary of the Company;

 

(4)                                  any
Investment made as a result of the receipt of non-cash consideration from an
Asset Sale that was made pursuant to and in compliance with Section 4.10
hereof;

 

(5)                                  any
acquisition of assets or Capital Stock solely in exchange for the issuance of
Equity Interests (other than Disqualified Stock) of the Company;

 

(6)                                  any
Investments received (a) in compromise or resolution of
(i) obligations of trade creditors or customers that were incurred in the
ordinary course of business of the Company or any of its Restricted
Subsidiaries, including pursuant to any plan of reorganization or similar
arrangement upon the bankruptcy or insolvency of any trade creditor or customer
or (ii) litigation, arbitration or other disputes with Persons who are not
Affiliates; or (b) in satisfaction of judgments;

 

(7)                                  Investments
represented by Hedging Obligations;

 

(8)                                  loans
or advances to directors, officers, employees and consultants made in the
ordinary course of business of the Company or the Restricted Subsidiary of the
Company in an aggregate principal amount not to exceed $2.0 million at any
one time outstanding;

 

(9)                                  repurchases
of the Notes;

 

19

 

(10)                            intercompany
loans to the extent permitted by Section 4.09 hereof;

 

(11)                            loans
by the Company in an aggregate principal amount not exceeding $3.0 million
to employees of the Company or its Restricted Subsidiaries to finance the sale
of the Company’s Capital Stock by the Company to such employees; provided that the net cash proceeds from such sales
respecting such loaned amounts will not be included in the calculation
described in clause (1)(b) of the first paragraph of Section 4.07(a)
hereof;

 

(12)                            any
Investment in existence on the date hereof;

 

(13)                            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;

 

(14)                            any
Investment in any Person to the extent the Investment consists of prepaid
expenses, negotiable instruments held for collection and lease, utility and
workers’ compensation, performance and other similar deposits made in the
ordinary course of business by the Company or any of its Restricted
Subsidiaries; and

 

(15)                            other
Investments in any Person having an aggregate Fair Market Value (measured on
the date each such Investment was made and without giving effect to subsequent
changes in value), when taken together with all other Investments made pursuant
to this clause (15) that are at the time outstanding, not to exceed
$10.0 million; provided that
if an Investment made pursuant to this clause (15) is made in any Person
that is not a Restricted Subsidiary of the Company at the date of the making of
the Investment and such Person becomes a Restricted Subsidiary after such date,
such Investment will thereafter be deemed to have been made pursuant to
clause (1) above and shall cease to have been made pursuant to this clause (15).

 

“Permitted
Junior Securities” means: debt or equity securities of the
Company or any successor corporation issued pursuant to a plan of
reorganization or readjustment of the Company that are subordinated to the
payment of all then-outstanding Senior Indebtedness of the Company at least to
the same extent that the Notes are subordinated to the payment of all Senior
Indebtedness of the Company on the issue date, so long as to the extent that
any Senior Indebtedness of the Company outstanding on the date of consummation
of any such plan of reorganization or readjustment is not paid in full in cash
on such date, either (a) the holders of any such Senior Indebtedness not
so paid in full in cash have consented to the terms of such plan of
reorganization or readjustment or (b) such holders receive securities
which constitute Senior Indebtedness and which have been determined by the
relevant court to constitute satisfaction in full in cash of any Senior
Indebtedness not paid in full in cash.

 

20

 

“Permitted
Liens” means:

 

(1)                                  Liens
on assets of the Company or any of its Restricted Subsidiaries securing
Indebtedness and other Obligations under Credit Facilities that were permitted
by the terms of this Indenture to be incurred and/or securing certain Hedging
Obligations;

 

(2)                                  Liens
in favor of the Company or the Guarantors;

 

(3)                                  Liens
on property of a Person existing at the time such Person is merged with or into
or consolidated with the Company or any Subsidiary of the Company; provided that such Liens were not incurred in contemplation
of such merger or consolidation and do not extend to any assets other than
those of the Person merged into or consolidated with the Company or the
Subsidiary;

 

(4)                                  Liens
on property (including Capital Stock) existing at the time of acquisition of
the property by the Company or any Subsidiary of the Company; provided that such Liens were not incurred in contemplation
of, such acquisition;

 

(5)                                  Liens
to secure the performance of statutory obligations, surety or appeal bonds,
performance bonds, deposits to secure the performance of bids, trade contracts,
government contracts, warranty requirements, leases or licenses or other
obligations of a like nature or incurred in the ordinary course of business
(including, without limitation, landlord Liens on leased real property and
rights of offset and set-off);

 

(6)                                  Liens
to secure Indebtedness (including Capital Lease Obligations) permitted by  Section 4.09(b)(5) of this Indenture; covering only
the assets acquired with or financed by such Indebtedness;

 

(7)                                  Liens
existing on the date hereof;

 

(8)                                  Liens
for taxes, assessments or governmental charges or claims that are not yet
delinquent or that are being contested in good faith by appropriate proceedings
promptly instituted and diligently concluded; provided
that any reserve or other appropriate provision as is required in conformity
with GAAP has been made therefor;

 

(9)                                  Liens
imposed by law, such as carriers’, warehousemen’s, landlord’s, materialmen’s,
repairmen’s and mechanics’ Liens, in each case, incurred in the ordinary course
of business;

 

(10)                            survey
exceptions, easements or reservations of, or rights of others for, licenses,
rights-of-way, sewers, electric lines, telegraph and telephone lines

 

21

 

and other similar
purposes, or zoning or other restrictions as to the use of real property that
were not incurred in connection with Indebtedness and that 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;

 

(11)                            Liens
to secure any Permitted Refinancing Indebtedness permitted to be incurred under
this Indenture; provided, however, that:

 

(a)                                  the
new Lien shall be limited to all or part of the same property and assets that
secured or, under the written agreements pursuant to which the original Lien
arose, could secure the original Lien (plus
improvements and accessions to, such property or proceeds or distributions
thereof); and

 

(b)                                 the
Indebtedness secured by the new Lien is not increased to any amount greater
than the sum of (x) the outstanding principal amount, or, if greater,
committed amount, of the Permitted Refinancing Indebtedness and (y) an amount
necessary to pay any fees and expenses, including premiums, related to such
renewal, refunding, refinancing, replacement, defeasance or discharge;

 

(12)                            Liens
in favor of customs and revenue authorities to secure payment of customs duties
in connection with the importation of goods in the ordinary course of business
and other similar Liens arising in the ordinary course of business;

 

(13)                            Liens
securing reimbursement obligations with respect to commercial letters of credit
which encumber documents and other property relating to such letters of credit
and products and proceeds thereof;

 

(14)                            any
interest or title of a lessor under any Capital Lease Obligation permitted to
be incurred under this Indenture; provided that such
Liens do not extend to any property or assets which is not leased property
subject to such Capital Lease Obligation;

 

(15)                            Liens
upon specific items of inventory or 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;

 

(16)                            leases
or subleases granted to third Persons not interfering with the ordinary course
of business of the Company or any of its Restricted Subsidiaries;

 

22

 

(17)                            Liens
(other than any Lien imposed by ERISA or any rule or regulation promulgated
thereunder) incurred or deposits made in the ordinary course of business in
connection with workers’ compensation, unemployment insurance, and other types
of social security;

 

(18)                            deposits,
in an aggregate not to exceed $250,000 at any one time outstanding, made in the
ordinary course of business to secure liability to insurance carriers;

 

(19)                            Liens
under licensing agreements for use of intellectual property entered into in the
ordinary course of business;

 

(20)                            judgment
Liens not giving rise to an Event of Default;

 

(21)                            Liens
on the assets of a Restricted Subsidiary of the Company that is not a Guarantor
securing Indebtedness of that Restricted Subsidiary; provided
that such Indebtedness was permitted to be incurred under Section 4.09
hereof;

 

(22)                            Liens
arising out of conditional sale, title retention, consignment or similar
arrangements for the sale of goods entered into by the Company or any of its
Restricted Subsidiaries in the ordinary course of business; and

 

(23)                            Liens
incurred in the ordinary course of business of the Company or any Subsidiary of
the Company with respect to obligations that do not exceed $10.0 million
at any one time outstanding.

 

“Permitted
Refinancing Indebtedness” means any Indebtedness of the
Company or any of its Restricted Subsidiaries issued in exchange for, or the
net proceeds of which are used to renew, refund, refinance, replace, defease or
discharge other Indebtedness of the Company or any of its Restricted
Subsidiaries (other than intercompany Indebtedness); provided that:

 

(1)                                  the
principal amount (or accreted value, if applicable) of such Permitted
Refinancing Indebtedness does not exceed the principal amount (or accreted
value, if applicable) of the Indebtedness renewed, refunded, refinanced,
replaced, defeased or discharged (plus
all accrued interest on the Indebtedness and the amount of all fees and
expenses, including premiums, incurred in connection therewith);

 

(2)                                  such
Permitted Refinancing Indebtedness has a final maturity date later than or the
same as the final maturity date of, and has a Weighted Average Life to Maturity
equal to or greater than the Weighted Average Life to Maturity of, the
Indebtedness being renewed, refunded, refinanced, replaced, defeased or
discharged;

 

23

 

(3)                                  if
the Indebtedness being renewed, refunded, refinanced, replaced, defeased or
discharged is subordinated in right of payment to the Notes, such Permitted
Refinancing Indebtedness has a final maturity date later than the final
maturity date of, and is subordinated in right of payment to, the Notes on
terms at least as favorable to the holders of Notes as those contained in the
documentation governing the Indebtedness being renewed, refunded, refinanced,
replaced, defeased or discharged; and

 

(4)                                  such
Indebtedness is incurred either by the Company or by the Restricted Subsidiary
who is the obligor on the Indebtedness being renewed, refunded, refinanced,
replaced, defeased or discharged.

 

“Person”
means any individual, corporation, limited liability company, joint stock
company, joint venture, partnership, limited liability partnership,
association, unincorporated organization, trust, governmental regulatory
entity, country, state, agency or political subdivision thereof, municipality,
county, parish or other entity.

 

“Principals”
means the members of management of the Company or any of the Company’s
Restricted Subsidiaries as of the date hereof.

 

“Related
Party” means

 

(1)                                  any
controlling stockholder, 66 2/3% or more owned Subsidiary, or immediate family
member (in the case of an individual) of any Principal; or

 

(2)                                  any
trust, corporation, partnership, limited liability company or other entity, the
beneficiaries, stockholders, partners, members, owners or Persons beneficially
holding a 66 2/3% or more controlling interest of which consist of any one or
more Principals and/or such other Persons referred to in the immediately
preceding clause (1).

 

“Representative”
means the trustee, agent or representative (if any) for an issue of Senior
Indebtedness.

 

“Responsible
Officer,” when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.

 

“Restricted
Investment” means an Investment other than a Permitted
Investment.

 

24

 

“Restricted
Subsidiary” of a Person means any Subsidiary of the referent
Person that is not an Unrestricted Subsidiary.

 

“SEC”
means the Securities and Exchange Commission.

 

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

 

“Securities
Holders Agreement” means the Second Amended and Restated
Securities Holders Agreement dated as of October 14, 2004 among BRS, certain of
the Company’s existing stockholders, certain members of the Company’s Board of
Directors and the Company’s executive officers, as in effect on the date of
this Indenture.

 

“Senior
Indebtedness” with respect to the Company or any Guarantor
means all Indebtedness of the Company or such Guarantor, including interest
thereon (including interest accruing on or after the filing of any petition in
bankruptcy or for reorganization relating to the Company or any Subsidiary of
the Company whether or not a claim for post-filing interest is allowed in such
proceeding) and other amounts (including make-whole payments, fees, expenses
and reimbursement obligations under letters of credit and indemnities) owing in
respect thereof, whether outstanding on the date of this Indenture or
thereafter incurred, unless in the instrument creating or evidencing the same
or pursuant to which the same is outstanding it is provided that such
obligations are not superior in right of payment to the notes or such
Guarantor’s Note Guarantee, as applicable; provided,
however, that Senior Indebtedness
shall not include, as applicable, (i) any obligation of the Company to any
Subsidiary of the Company or of a Guarantor to the Company or any Subsidiary of
the Company, (ii) any liability for Federal, state, local or other taxes
owed or owing by the Company or such Guarantor, (iii) any accounts payable
or other liability to trade creditors arising in the ordinary course of
business (including guarantees thereof or instruments evidencing such
liabilities), (iv) any obligations with respect to any Capital Stock,
(v) any Indebtedness incurred in violation of this Indenture, provided
that Indebtedness under Credit Facilities will not cease to be Senior
Indebtedness under this clause (v) if the lenders of such Indebtedness
obtained an Officer’s Certificate as of the date of incurrence of such
Indebtedness to the effect that such Indebtedness was permitted to be incurred
by this Indenture and (vi) any Indebtedness or Obligations of the Company
or such Guarantor which is pari passu
Indebtedness.

 

“Senior
Note Indenture” means the indenture relating to the Senior
Notes, dated the date hereof.

 

“Senior
Notes” means the Company’s 8.0% Senior Notes due 2011.

 

“Senior
Notes Guarantee” means the Guarantee by each Guarantor of the
Company’s obligations under the Senior Notes, executed pursuant to the
provisions of the Senior Notes Indenture.

 

25

 

“Significant
Subsidiary” means any Restricted Subsidiary that would be a “significant subsidiary” as defined in Article 1, Rule 1-02 of
Regulation S-X, promulgated pursuant to the Securities Act, as such Regulation
is in effect on the hereof.

 

“Stated
Maturity” means, with respect to any installment of interest
or principal on any series of Indebtedness, the date on which the payment of
interest or principal was scheduled to be paid in the documentation governing
such Indebtedness as of the date hereof, and will not include any contingent
obligations to repay, redeem or repurchase any such interest or principal prior
to the date originally scheduled for the payment thereof.

 

“Subsidiary”
means, with respect to any specified Person:

 

(1)                                  any
corporation, association or other business entity of which more than 50% of the
total voting power of shares of Capital Stock entitled (without regard to the
occurrence of any contingency and after giving effect to any voting agreement
or stockholders’ agreement that effectively transfers voting power) to vote in
the election of directors, managers or trustees of the corporation, association
or other business entity is at the time owned or controlled, directly or
indirectly, by that Person or one or more of the other Subsidiaries of that
Person (or a combination thereof); and

 

(2)                                  any
partnership (a) the sole general partner or the managing general partner
of which is such Person or a Subsidiary of such Person or (b) the only
general partners of which are that Person or one or more Subsidiaries of that
Person (or any combination thereof).

 

“TIA”
means the Trust Indenture Act of 1939, as amended (15 U.S.C.
§§ 77aaa-77bbbb).

 

“Transaction
Services Agreement” means the amended and restated
Transaction Services Agreement, dated as of September 30, 2004, between BRS and
the Company, as in effect on the date hereof.

 

“Transactions”
has the meaning given in the prospectus related to the Notes, dated October 7,
2004.

 

“Trustee”
means The Bank of New York until a successor replaces it in accordance with the
applicable provisions of this Indenture and thereafter means the successor
serving hereunder.

 

“Unrestricted Subsidiary”
means any Subsidiary of the Company that is designated by the Board of
Directors of the Company as an Unrestricted Subsidiary

 

26

 

pursuant to a resolution
of the Board of Directors, but only to the extent that such Subsidiary:

 

(1)                                  has
no Indebtedness other than Non-Recourse Debt;

 

(2)                                  except
as permitted by Section 4.11 hereof, is not party to any agreement,
contract, arrangement or understanding with the Company or any Restricted
Subsidiary of the Company unless the terms of any such agreement, contract,
arrangement or understanding are no less favorable to the Company or such
Restricted Subsidiary than those that might be obtained at the time from
Persons who are not Affiliates of the Company;

 

(3)                                  is
a Person with respect to which neither the Company nor any of its Restricted
Subsidiaries has any direct or indirect obligation (a) to subscribe for
additional Equity Interests or (b) to maintain or preserve such Person’s
financial condition or to cause such Person to achieve any specified levels of
operating results; and

 

(4)                                  has
not guaranteed or otherwise directly or indirectly provided credit support for
any Indebtedness of the Company or any of its Restricted Subsidiaries.

 

“U.S.
Person” means a U.S. Person as defined in Rule 902(k)
promulgated under the Securities Act.

 

“Voting
Stock” of any specified Person as of any date means the
Capital Stock of such Person that is at the time entitled to vote in the
election of the Board of Directors of such Person.

 

“Weighted
Average Life to Maturity” means, when applied to any
Indebtedness at any date, the number of years obtained by dividing:

 

(1)                                  the
sum of the products obtained by multiplying (a) the amount of each then
remaining installment, sinking fund, serial maturity or other required payments
of principal, including payment at final maturity, in respect of the
Indebtedness, by (b) the number of years (calculated to the nearest
one-twelfth) that will elapse between such date and the making of such payment;
by

 

(2)                                  the
then outstanding principal amount of such Indebtedness.

 

27

 

Section 1.02                                Other Definitions.

 

	
  Term

  	
   

  	
  Defined in

  Section

  
	
  “Affiliate Transaction”

  	
   

  	
  4.11

  
	
  “Asset Sale Offer”

  	
   

  	
  3.09

  
	
  “Authentication Order”

  	
   

  	
  2.02

  
	
  “Automatic Exchange”

  	
   

  	
  4.21

  
	
  “Blockage Notice”

  	
   

  	
  10.03

  
	
  “Change of Control Offer”

  	
   

  	
  4.15

  
	
  “Change of Control Payment”

  	
   

  	
  4.15

  
	
  “Change of Control Payment
  Date”

  	
   

  	
  4.15

  
	
  “Covenant Defeasance”

  	
   

  	
  8.03

  
	
  “DTC”

  	
   

  	
  2.03

  
	
  “Event of Default”

  	
   

  	
  6.01

  
	
  “Excess Proceeds”

  	
   

  	
  4.10

  
	
  “Incremental Funds”

  	
   

  	
  4.07

  
	
  “incur”

  	
   

  	
  4.09

  
	
  “Legal Defeasance”

  	
   

  	
  8.02

  
	
  “Note Units”

  	
   

  	
  4.21

  
	
  “Offer Amount”

  	
   

  	
  3.09

  
	
  “Offer Period”

  	
   

  	
  3.09

  
	
  “pay the Notes”

  	
   

  	
  10.03

  
	
  “Paying Agent”

  	
   

  	
  2.03

  
	
  “Payment Blockage Period”

  	
   

  	
  10.03

  
	
  “Payment Default”

  	
   

  	
  6.01

  
	
  “Permitted Debt”

  	
   

  	
  4.09

  
	
  “Purchase Date”

  	
   

  	
  3.09

  
	
  “Registrar”

  	
   

  	
  2.03

  
	
  “Restricted Payments”

  	
   

  	
  4.07

  
	
  “Trustee”

  	
   

  	
  8.05

  

 

Section 1.03                                Incorporation by Reference of
Trust Indenture Act.

 

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

 

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

 

“indenture securities” means the
Notes;

 

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

 

“indenture to be qualified” means
this Indenture;

 

28

 

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

 

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

 

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

 

Section 1.04                                Rules of Construction.

 

Unless the context otherwise requires:

 

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

 

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

 

(3)                                  “or”
is not exclusive;

 

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

 

(5)                                  “will” shall be interpreted to express a command;

 

(6)                                  provisions apply to successive
events and transactions; and

 

(7)                                  references to sections of or rules
under the Securities Act will be deemed to include substitute, replacement of
successor sections or rules adopted by the SEC from time to time.

 

ARTICLE 2

THE NOTES

 

Section 2.01                                Form and Dating.

 

(a)                                  General. 
The Notes and the Trustee’s certificate of authentication will be
substantially in the form of Exhibit A hereto. 
The Notes may have notations, legends or endorsements required by law,
stock exchange rule or usage.  Each Note
will be dated the date of its authentication. 
The Notes shall be in denominations of $7.15 and integral multiples
thereof.

 

29

 

The terms and provisions contained in the Notes will
constitute, and are hereby expressly made, a part of this Indenture and the
Company, the Guarantors and the Trustee, by their execution and delivery of
this Indenture, expressly agree to such terms and provisions and to be bound
thereby.  However, to the extent any
provision of any Note conflicts with the express provisions of this Indenture,
the provisions of this Indenture shall govern and be controlling.

 

(b)                                 Global Notes. 
Notes issued in global form will be substantially in the form of Exhibit
A hereto (including the Global Note Legend thereon and the “Schedule of Exchanges of Interests in the
Global Note” attached
thereto).  Notes issued in definitive
form will be substantially in the form of Exhibit A1 hereto (but without the
Global Note Legend thereon and without the “Schedule
of Exchanges of Interests in the Global Note”
attached thereto).  Each Global Note will
represent such of the outstanding Notes as will be specified therein and each
shall provide that it represents the aggregate principal amount of outstanding
Notes from time to time endorsed thereon and that the aggregate principal
amount of outstanding Notes represented thereby may from time to time be
reduced or increased, as appropriate, to reflect exchanges and
redemptions.  Any endorsement of a Global
Note to reflect the amount of any increase or decrease in the aggregate
principal amount of outstanding Notes represented thereby will be made by the
Trustee or the Custodian, at the direction of the Trustee, in accordance with
instructions given by the Holder thereof as required by Section 2.06
hereof.

 

(c)                                  Euroclear and Clearstream
Procedures Applicable.  The provisions of the “Operating Procedures of the Euroclear
System” and “Terms and Conditions Governing Use of
Euroclear” and the “General Terms and Conditions of
Clearstream Banking” and “Customer Handbook” of Clearstream will be applicable to
transfers of beneficial interests in the Global Notes that are held by
Participants through Euroclear or Clearstream.

 

Section 2.02                                Execution and Authentication.

 

At least one Officer must sign the Notes for the
Company by manual or facsimile signature.

 

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

 

A Note will not be valid until authenticated by the
manual signature of the Trustee.  The
signature will be conclusive evidence that the Note has been authenticated
under this Indenture.

 

The Trustee will, upon receipt of a written order of
the Company signed by at least one Officer (an “Authentication Order”),
authenticate (1) Initial Notes for original issue on the date of issuance of
the Initial Notes in an aggregate principal amount of

 

30

 

$152,347,829.40, and (2)
subject to the terms of this Indenture, Additional Notes from time to time for
original issue in an amount specified by the Company.  The aggregate principal amount of Notes
outstanding at any time may not exceed the aggregate principal amount of Notes
authorized for issuance by the Company pursuant to one or more Authentication
Orders, except as provided in Section 2.07 hereof.

 

The Trustee may appoint an authenticating agent
acceptable to the Company to authenticate Notes.  An authenticating agent may authenticate
Notes whenever the Trustee may do so.  Each
reference in this Indenture to authentication by the Trustee includes authentication
by such agent.  An authenticating agent
has the same rights as an Agent to deal with Holders or an Affiliate of the
Company.

 

Section 2.03                                Registrar and Paying Agent.

 

The Company will maintain an office or agency where
Notes may be presented for registration of transfer or for exchange (“Registrar”) and an office or agency where
Notes may be presented for payment (“Paying Agent”).  The Registrar will keep a register of the
Notes and of their transfer and exchange. 
The Company may appoint one or more co-registrars and one or more
additional paying agents.  The term “Registrar”
includes any co-registrar and the term “Paying
Agent” includes any additional
paying agent.  The Company may change any
Paying Agent or Registrar without notice to any Holder.  The Company will notify the Trustee in
writing of the name and address of any Agent not a party to this
Indenture.  If the Company fails to
appoint or maintain another entity as Registrar or Paying Agent, the Trustee
shall act as such.  The Company or any of
its Subsidiaries may act as Paying Agent or Registrar.

 

The Company initially appoints The Depositary Trust
Company (“DTC”) to act as Depositary with respect to the Global Notes.  The Trustee shall act as custodian for the
Global Notes that represent Notes held as part of EISs on behalf of Cede &
Co., the registered owner of EISs and such Global Notes will be registered in
the name of the Trustee as custodian for Cede & Co, DTC’s nominee.  The Trustee shall act as custodian for the
Global Notes that represent Notes held separately (not in the form of EISs) on
behalf of DTC and such Global Notes shall be registered in the name of Cede
& Co., DTC’s nominee.

 

The Company initially appoints the Trustee to act as
the Registrar and Paying Agent and to act as Custodian with respect to the
Global Notes.

 

Section 2.04                                Paying Agent to Hold Money in
Trust.

 

The Company will require each Paying Agent other than
the Trustee to agree in writing that the Paying Agent will hold in trust for
the benefit of Holders or the Trustee all money held by the Paying Agent for
the payment of principal, premium, if any, or interest on the Notes, and will
notify the Trustee of any default by the Company in

 

31

 

making any such payment.  While any such default continues, the Trustee
may require a Paying Agent to pay all money held by it to the Trustee.  The Company at any time may require a Paying
Agent to pay all money held by it to the Trustee.  Upon payment over to the Trustee, the Paying
Agent (if other than the Company or a Subsidiary) will have no further
liability for the money.  If the Company
or a Subsidiary acts as Paying Agent, it will segregate and hold in a separate
trust fund for the benefit of the Holders all money held by it as Paying
Agent.  Upon any bankruptcy or
reorganization proceedings relating to the Company, the Trustee will serve as
Paying Agent for the Notes.

 

Section 2.05                                Holder Lists.

 

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

 

Section 2.06                                Transfer and Exchange.

 

(a)                                  Transfer and Exchange of Global
Notes.  A Global Note may not be transferred except
as a whole by the Depositary to a nominee of the Depositary, by a nominee of
the Depositary to the Depositary or to another nominee of the Depositary, or by
the Depositary or any such nominee to a successor Depositary or a nominee of
such successor Depositary.  All Global
Notes will be exchanged by the Company for Definitive Notes if:

 

(1)                                  the Company delivers to the Trustee
notice from the Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under the
Exchange Act and, in either case, a successor Depositary is not appointed by
the Company within 120 days after the date of such notice from the Depositary;

 

(2)                                  the Company in its sole discretion
determines that the Global Notes (in whole but not in part) should be exchanged
for Definitive Notes and delivers a written notice to such effect to the
Trustee;  or

 

(3)                                  there has occurred and is
continuing a Default or Event of Default with respect to the Notes.

 

Upon the occurrence of either of the preceding events
in (1) or (2) above, Definitive Notes shall be issued in such names as the
Depositary shall instruct the Trustee. 
Global Notes also may be exchanged or replaced, in whole or in part, as

 

32

 

provided in Sections 2.07
and 2.10 hereof.  Every Note
authenticated and delivered in exchange for, or in lieu of, a Global Note or
any portion thereof, pursuant to this Section 2.06 or Section 2.07 or
2.10 hereof, shall be authenticated and delivered in the form of, and shall be,
a Global Note.  A Global Note may not be
exchanged for another Note other than as provided in this Section 2.06(a),
however, beneficial interests in a Global Note may be transferred and exchanged
as provided in Section 2.06(b) or (c) hereof.

 

(b)                                 Transfer and
Exchange of Beneficial Interests in the Global Notes. 
The transfer and exchange of beneficial interests in the Global Notes
will be effected through the Depositary, in accordance with the provisions of
this Indenture and the Applicable Procedures. 
Beneficial interests in any Global Note may be transferred to Persons
who take delivery thereof in the form of a beneficial interest in a Global
Note.  No written orders or instructions
shall be required to be delivered to the Registrar to effect the transfers
described in this Section 2.06(b).

 

(c)                                  Transfer and
Exchange of Beneficial Interests for Definitive Notes. 
If any holder of a beneficial interest in a Global Note proposes to
exchange such beneficial interest for a Definitive Note or to transfer such
beneficial interest to a Person who takes delivery thereof in the form of a
Definitive Note, the Trustee will cause the aggregate principal amount of the
applicable Global Note to be reduced accordingly pursuant to
Section 2.06(g) hereof, and the Company will execute and the Trustee will
authenticate and deliver to the Person designated in the instructions a
Definitive Note in the appropriate principal amount.  Any Definitive Note issued in exchange for a
beneficial interest pursuant to this Section 2.06(c) will be registered in
such name or names and in such authorized denomination or denominations as the
holder of such beneficial interest requests through instructions to the
Registrar from or through the Depositary and the Participant or Indirect
Participant.

 

(d)                                 Transfer and
Exchange of Definitive Notes for Beneficial Interests. 
A Holder of a Definitive Note may exchange such Note for a beneficial
interest in a Global Note or transfer such Definitive Notes to a Person who
takes delivery thereof in the form of a beneficial interest in a Global Note at
any time.  Upon receipt of a request for
such an exchange or transfer, the Trustee will cancel the applicable Definitive
Note and increase or cause to be increased the aggregate principal amount of
one of the Global Notes.  If any such
exchange or transfer from a Definitive Note to a beneficial interest is
effected pursuant to this paragraph at a time when a Global Note has not yet
been issued, the Company will issue and, upon receipt of an Authentication
Order in accordance with Section 2.02 hereof, the Trustee will
authenticate one or more Global Notes in an aggregate principal amount equal to
the principal amount of Definitive Notes so transferred.

 

(e)                                  Transfer and
Exchange of Definitive Notes for Definitive Notes. 
Upon request by a Holder of Definitive Notes and such Holder’s
compliance with the

 

33

 

provisions of this
Section 2.06(e), the Registrar will register the transfer or exchange of
Definitive Notes.  Prior to such
registration of transfer or exchange, the requesting Holder must present or surrender
to the Registrar the Definitive Notes duly endorsed or accompanied by a written
instruction of transfer in form satisfactory to the Registrar duly executed by
such Holder or by its attorney, duly authorized in writing.

 

(f)                                    Legends. 
Each Global Note will bear a legend in substantially the following form:

 

“THIS GLOBAL NOTE
IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING THIS NOTE) OR
ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS
NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (1) THE
TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION
2.06 OF THE INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT
NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE, (3) THIS GLOBAL
NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 2.11
OF THE INDENTURE AND (4) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF B&G FOODS, INC.
(F/K/A/ B&G FOODS HOLDINGS CORP.)

 

[Include
the following paragraph for Global Notes that represent Notes held separately
(not in the form of EISs:  UNLESS
AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM,
THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY
OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE
TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.  UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW
YORK, NEW YORK) (“DTC”), 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 MAY BE REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE &
CO. OR SUCH OTHER ENTITY AS MAY BE 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.”]

 

[Include
the following paragraph for Global Notes that represent Notes held as part of
EISs:  UNLESS AND UNTIL IT
IS EXCHANGED IN WHOLE OR IN PART FOR

 

34

 

NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY
OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY
OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. 
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE BANK OF NEW YORK (101 BARCLAY STREET, NEW YORK, NEW YORK) IN ITS CAPACITY
AS CUSTODIAN FOR CEDE & CO., DTC’S NOMINEE, THE REGISTERED OWNER OF EISs,
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 MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE BANK OF
NEW YORK (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY
BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE BANK OF NEW YORK), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, THE BANK OF NEW YORK, AS
CUSTODIAN FOR CEDE & CO., HAS AN INTEREST HEREIN.”]

 

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

 

(h)                                 General Provisions Relating to
Transfers and Exchanges.

 

(1)                                  To permit registrations of
transfers and exchanges, the Company will execute and the Trustee will
authenticate Global Notes and Definitive Notes upon receipt of an
Authentication Order in accordance with Section 2.02 hereof or at the
Registrar’s request.

 

35

 

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

 

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

 

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

 

(5)                                  Neither the Registrar nor the
Company will be required:

 

(A)                              to issue, to register the transfer
of or to exchange any Notes during a period beginning at the opening of
business 15 days before the day of any selection of Notes for redemption under
Section 3.02 hereof and ending at the close of business on the day of
selection;

 

(B)                                to register the transfer of or to
exchange any Note selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part; or

 

(C)                                to register the transfer of or to
exchange a Note between a record date and the next succeeding interest payment
date.

 

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

 

(7)                                  The Trustee will authenticate
Global Notes and Definitive Notes in accordance with the provisions of
Section 2.02 hereof.

 

36

 

(8)                                  All certifications, certificates
and Opinions of Counsel required to be submitted to the Registrar pursuant to
this Section 2.06 to effect a registration of transfer or exchange may be
submitted by facsimile.

 

Section 2.07                                Replacement Notes.

 

If any mutilated Note is surrendered to the Trustee or
the Company and the Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, the Company will issue and the Trustee,
upon receipt of an Authentication Order, will authenticate a replacement Note
if the Trustee’s requirements are met. 
If required by the Trustee or the Company, an indemnity bond must be
supplied by the Holder that is sufficient in the judgment of the Trustee and
the Company to protect the Company, the Trustee, any Agent and any
authenticating agent from any loss that any of them may suffer if a Note is
replaced.  The Company may charge for its
expenses in replacing a Note.

 

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

 

Section 2.08                                Outstanding Notes.

 

The Notes outstanding at any time are all the Notes
authenticated by the Trustee except for those canceled by it, those delivered
to it for cancellation, those reductions in the interest in a Global Note
effected by the Trustee in accordance with the provisions hereof, and those
described in this Section 2.08 as not outstanding.  Except as set forth in Section 2.09
hereof, a Note does not cease to be outstanding because the Company or an
Affiliate of the Company holds the Note; however, Notes held by the Company or
a Subsidiary of the Company shall not be deemed to be outstanding for purposes of
Section 3.07(a) hereof.

 

If a Note is replaced pursuant to Section 2.07
hereof, it ceases to be outstanding unless the Trustee receives proof
satisfactory to it that the replaced Note is held by a protected purchaser.

 

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

 

If the Paying Agent (other than the Company, a
Subsidiary or an Affiliate of any thereof) holds, on a redemption date or
maturity date, money sufficient to pay Notes payable on that date, then on and
after that date such Notes will be deemed to be no longer outstanding and will
cease to accrue interest.

 

37

 

Section 2.09                                Treasury Notes.

 

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

 

Section 2.10                                Temporary Notes.

 

Until certificates representing Notes are ready for
delivery, the Company may prepare and the Trustee, upon receipt of an
Authentication Order, will authenticate temporary Notes.  Temporary Notes will be substantially in the
form of certificated Notes but may have variations that the Company considers
appropriate for temporary Notes and as may be reasonably acceptable to the
Trustee.  Without unreasonable delay, the
Company will prepare and the Trustee will authenticate definitive Notes in
exchange for temporary Notes.

 

Holders of temporary Notes will be entitled to all of
the benefits of this Indenture.

 

Section 2.11                                Cancellation.

 

The Company at any time may deliver Notes to the
Trustee for cancellation.  The Registrar
and Paying Agent will forward to the Trustee any Notes surrendered to them for
registration of transfer, exchange or payment. 
The Trustee and no one else will cancel all Notes surrendered for
registration of transfer, exchange, payment, replacement or cancellation and
will dispose of such canceled Notes (subject to the record retention
requirement of the Exchange Act) in its customary manner.  Certification of the disposition of all
canceled Notes will be delivered to the Company upon its written request
therefor.  The Company may not issue new
Notes to replace Notes that it has paid or that have been delivered to the
Trustee for cancellation.

 

Section 2.12                                Defaulted Interest.

 

If the Company defaults in a payment of interest on
the Notes, it will pay the defaulted interest in any lawful manner plus, to the extent lawful, interest
payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof.  The
Company will notify the Trustee in writing of the amount of defaulted interest
proposed to be paid on each Note and the date of the proposed payment.  The Company will fix or cause to be fixed
each such special record date and payment date; provided
that no such special

 

38

 

record date may be less
than 10 days prior to the related payment date for such defaulted
interest.  At least 15 days before the
special record date, the Company (or, upon the written request of the Company,
the Trustee in the name and at the expense of the Company) will mail or cause
to be mailed to Holders a notice that states the special record date, the related
payment date and the amount of such interest to be paid.

 

Section 2.13                                Maturity.

 

The Notes shall mature on October 30, 2016.

 

Section 2.14                                Tax Treatment.

 

The Company agrees, and by acceptance of a beneficial
ownership interest in the Notes, each beneficial owner of Notes shall be deemed
to have agreed (1) to treat such beneficial owner as the owner of the
Notes for all purposes, including the preparation and filing of any United
States federal, state, local or foreign tax return, report, or other information;
(2) to treat the Notes as indebtedness for all tax purposes and
(3) if such beneficial owner’s Notes are represented by EISs, to treat the
acquisition of any EIS as the acquisition of the Notes and shares of
Class A Common Stock which are represented by such EIS and to allocate the
purchase price of such EIS between the Notes and the shares of Class A
Common Stock in the proportions set forth in paragraph 20 of the Notes.  In the case of a beneficial owner acquiring
EISs in the initial offering thereof, such purchase price allocation shall be
(i) $7.15 allocated to the Note represented by each EIS and (ii) $7.85
allocated to the share of Class A Common Stock represented by such EIS.

 

Section
2.15                                CUSIP Numbers.

 

The Company in issuing the Notes may use “CUSIP”
numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP”
numbers in notices of redemption as a convenience to Holders; provided that any such notice may state
that no representation is made as to the correctness of such numbers either as
printed on the Notes or as contained in any notice of a redemption and that
reliance may be placed only on the other identification numbers printed on the
Notes, and any such redemption shall not be affected by any defect in or
omission of such numbers.  The Company
will promptly notify the Trustee in writing of any change in the “CUSIP”
numbers.

 

39

 

ARTICLE
3

REDEMPTION AND PREPAYMENT

 

Section 3.01                                Notices to Trustee.

 

If the Company elects to redeem Notes pursuant to the
optional redemption provisions of Section 3.07 hereof, it must furnish to
the Trustee, at least 45 days but not more than 60 days before a redemption
date, an Officers’ Certificate setting forth:

 

(1)                                  the clause of this Indenture
pursuant to which the redemption shall occur;

 

(2)                                  the redemption date;

 

(3)                                  the principal amount of Notes to be
redeemed; and

 

(4)                                  the redemption price.

 

Section 3.02                                Selection of Notes to Be Redeemed
or Purchased.

 

If less than all of the Notes are to be redeemed or
purchased in an offer to purchase at any time, the Trustee will select Notes
for redemption or purchase in principal amounts of $7.15 or integral multiples
thereof, by lot, on a pro rata basis,
by another method the Trustee deems appropriate, except:

 

(1)                                  if the Notes are listed on any
national securities exchange, in compliance with the requirements of the
principal national securities exchange on which the Notes are listed; or

 

(2)                                  if otherwise required by law.

 

In the event of partial redemption or purchase by lot,
the particular Notes to be redeemed or purchased will be selected, unless
otherwise provided herein, not less than 30 nor more than 60 days prior to the
redemption or purchase date by the Trustee from the outstanding Notes not
previously called for redemption or purchase.

 

The Trustee will promptly notify the Company in
writing of the Notes selected for redemption or purchase and, in the case of
any Note selected for partial redemption or purchase, the principal amount
thereof to be redeemed or purchased. 
Notes and portions of Notes selected will be in amounts of $7.15 or
whole multiples of $7.15; except that if all of the Notes of a Holder are to be
redeemed or purchased, the entire outstanding amount of Notes held by such Holder,
even if not a multiple of $7.15, shall be redeemed or purchased.  Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption or
purchase also apply to portions of Notes called for redemption or purchase.

 

40

 

Section 3.03                                Notice of Redemption.

 

Subject to the provisions of Section 3.09 hereof,
at least 30 days but not more than 60 days before a redemption date, the
Company will mail or cause to be mailed, by first class mail, a notice of
redemption to each Holder whose Notes are to be redeemed at its registered
address, except that redemption notices may be mailed more than 60 days prior
to a redemption date if the notice is issued in connection with a defeasance of
the Notes or a satisfaction and discharge of this Indenture pursuant to
Articles 8 or 11 hereof.

 

The notice will identify the Notes (including CUSIP
numbers) to be redeemed and will state:

 

(1)                                  the redemption date;

 

(2)                                  the redemption price;

 

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

 

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

 

(5)                                  that Notes called for redemption
must be surrendered to the Paying Agent to collect the redemption price;

 

(6)                                  that, unless the Company defaults
in making such redemption payment, interest on Notes called for redemption
ceases to accrue on and after the redemption date;

 

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

 

(8)                                  that no representation is made as
to the correctness or accuracy of the CUSIP number, if any, listed in such
notice or printed on the Notes.

 

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

 

41

 

Section 3.04                                Effect of Notice of Redemption.

 

Once notice of redemption is mailed in accordance with
Section 3.03 hereof, Notes called for redemption become irrevocably due
and payable on the redemption date at the redemption price.  A notice of redemption may not be
conditional.

 

Section 3.05                                Deposit of Redemption or Purchase
Price.

 

One Business Day prior to the redemption or purchase
date, the Company will deposit with the Trustee or with the Paying Agent prior
to 10:00 a.m. Eastern Time money sufficient to pay the redemption or purchase
price of and accrued interest on all Notes to be redeemed or purchased on that
date.  The Trustee or the Paying Agent
will promptly return to the Company any money deposited with the Trustee or the
Paying Agent by the Company in excess of the amounts necessary to pay the
redemption or purchase price of, and accrued interest on, all Notes to be
redeemed or purchased.

 

If the Company complies with the provisions of the
preceding paragraph, on and after the redemption or purchase date, interest
will cease to accrue on the Notes or the portions of Notes called for
redemption or purchase.  If a Note is
redeemed or purchased on or after an interest record date but on or prior to
the related interest payment date, then any accrued and unpaid interest shall
be paid to the Person in whose name such Note was registered at the close of
business on such record date.  If any
Note called for redemption or purchase is not so paid upon surrender for
redemption or purchase because of the failure of the Company to comply with the
preceding paragraph, interest shall be paid on the unpaid principal, from the
redemption or purchase date until such principal is paid, and to the extent
lawful on any interest not paid on such unpaid principal, in each case at the
rate provided in the Notes and in Section 4.01 hereof.

 

Section 3.06                                Notes Redeemed or Purchased in
Part.

 

Upon surrender of a Note that is redeemed or purchased
in part, the Company will issue and, upon receipt of an Authentication Order,
the Trustee will authenticate for the Holder at the expense of the Company a
new Note equal in principal amount to the unredeemed or unpurchased portion of
the Note surrendered.

 

Section 3.07                                Optional Redemption.

 

(a)                                  On
and after October 30, 2009, the Company may redeem all or a part of the Notes
upon not less than 30 nor more than 60 days notice, at the redemption prices
(expressed as percentages of principal amount) set forth below plus accrued and
unpaid interest on the Notes redeemed, to the applicable redemption date, if
redeemed during the twelve-month period beginning on October 30 of the years
indicated below, subject to the rights of Holders of Notes on the relevant
record date to receive interest on the relevant interest payment date: 

 

42

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
  2009

  	
   

  	
  106.000

  	
  %

  
	
  2010

  	
   

  	
  104.000

  	
  %

  
	
  2011

  	
   

  	
  102.000

  	
  %

  
	
  2012 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

Unless the Company defaults in the payment of the
redemption price, interest will cease to accrue on the Notes or portions
thereof called for redemption on the applicable redemption date.

 

(b)                                 The Notes will not be redeemable at
the Company’s option prior to October 30, 2009.

 

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

 

(d)                                 Any exercise by the Company of its
option to redeem the Notes, in whole or in part, will result in an automatic
separation of the EISs upon the redemption date.

 

Section 3.08                                Mandatory Redemption.

 

The Company is not required to make mandatory
redemption or sinking fund payments with respect to the Notes.

 

Section 3.09                                Offer to Purchase by Application
of Excess Proceeds.

 

In the event that, pursuant to Section 4.10
hereof, the Company is required to commence an offer to all Holders to purchase
Notes (an “Asset Sale
Offer”), it will
follow the procedures specified below.

 

The Asset Sale Offer shall be made to all Holders and
all holders of other Indebtedness that is pari
passu with the Notes containing provisions similar to those set
forth in this Indenture with respect to offers to purchase or redeem with the
proceeds of sales of assets.  The Asset
Sale Offer will remain open for a period of at least 20 Business Days following
its commencement and not more than 30 Business Days, except to the extent that
a longer period is required by applicable law (the “Offer Period”).  No later than three Business Days after the
termination of the Offer Period (the “Purchase Date”),
the Company will apply all Excess Proceeds (the “Offer
Amount”) to the purchase of Notes and such other pari passu Indebtedness (on a pro rata
basis, if applicable) or, if less than the Offer Amount has been tendered, all
Notes and other Indebtedness tendered in response to the Asset Sale Offer.  Payment for any Notes so purchased will be
made in the same manner as interest payments are made.

 

43

 

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

 

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

 

(1)                                  that the Asset Sale Offer is being
made pursuant to this Section 3.09 and Section 4.10 hereof and the
length of time the Asset Sale Offer will remain open;

 

(2)                                  the Offer Amount, the purchase
price and the Purchase Date;

 

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

 

(4)                                  that, unless the Company defaults
in making such payment, any Note accepted for payment pursuant to the Asset
Sale Offer will cease to accrue interest after the Purchase Date;

 

(5)                                  that Holders electing to have a Note
purchased pursuant to an Asset Sale Offer may elect to have Notes purchased in
integral multiples of $7.15 only;

 

(6)                                  that Holders electing to have Notes
purchased pursuant to any Asset Sale Offer will be required to surrender the
Note, with the form entitled “Option
of Holder to Elect Purchase”
attached to the Notes completed, or transfer by book-entry transfer, to the
Company, a Depositary, if appointed by the Company, or a Paying Agent at the
address specified in the notice at least three days before the Purchase Date;

 

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

 

44

 

(8)                                  that, if the aggregate principal
amount of Notes and other pari passu
Indebtedness surrendered by holders thereof exceeds the Offer Amount, the
Company will select the Notes and other pari passu
Indebtedness to be purchased on a pro rata basis,
based on the principal amount of Notes and such other pari passu
Indebtedness surrendered (with such adjustments as may be deemed appropriate by
the Company so that only Notes in denominations of $7.15, or integral multiples
thereof, will be purchased); and

 

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

 

On or before the Purchase Date, the Company will, to the
extent lawful, accept for payment, on a pro rata basis,
to the extent necessary, the Offer Amount of Notes or portions thereof tendered
pursuant to the Asset Sale Offer, or if less than the Offer Amount has been
tendered, all Notes tendered, and will deliver or cause to be delivered to the
Trustee the Notes properly accepted together with an Officers’ Certificate
stating that such Notes or portions thereof were accepted for payment by the
Company in accordance with the terms of this Section 3.09.  The Company, the Depositary or the Paying
Agent, as the case may be, will promptly (but in any case not later than five
days after the Purchase Date) mail or deliver to each tendering Holder an
amount equal to the purchase price of the Notes tendered by such Holder and
accepted by the Company for purchase, and the Company will promptly issue a new
Note, and the Trustee, upon written request from the Company, will authenticate
and mail or deliver (or cause to be transferred by book entry) such new Note to
such Holder, in a principal amount equal to any unpurchased portion of the Note
surrendered.  Any Note not so accepted
shall be promptly mailed or delivered by the Company to the Holder thereof.  The Company will publicly announce the
results of the Asset Sale Offer on the Purchase Date.

 

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

 

ARTICLE 4

COVENANTS

 

Section 4.01                                Payment of Notes.

 

The Company will pay or cause to be paid the principal
of, premium, if any, and interest on, the Notes on the dates and in the manner
provided in the Notes.  Principal,
premium, if any, and interest will be considered paid on the date due if the
Paying Agent, if other than the Company or a Subsidiary thereof, holds as of
10:00 a.m. Eastern Time on the due date money deposited by the Company in
immediately available funds and designated for and sufficient to pay all
principal, premium, if any, and interest then due.

 

45

 

The Company will pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal at
the rate equal to 1% per annum in excess of the then applicable interest rate
on the Notes to the extent lawful; it will pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest (without regard to any applicable grace period) at the
same rate to the extent lawful.

 

Section 4.02                                Maintenance of Office or Agency.

 

The Company will maintain in the Borough of Manhattan,
the City of New York, an office or agency (which may be an office of the
Trustee or an affiliate of the Trustee, Registrar or co-registrar) where Notes
may be surrendered for registration of transfer or for exchange and where
notices and demands to or upon the Company in respect of the Notes and this
Indenture may be served.  The Company
will give prompt written notice to the Trustee of the location, and any change
in the location, of such office or agency. 
If at any time the Company fails to maintain any such required office or
agency or fails to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee.

 

The Company may also from time to time designate one
or more other offices or agencies where the Notes may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such
designation or rescission will in any manner relieve the Company of its
obligation to maintain an office or agency in the Borough of Manhattan, the
City of New York for such purposes.  The
Company will give prompt written notice to the Trustee of any such designation
or rescission and of any change in the location of any such other office or
agency.

 

The Company hereby designates the Corporate Trust
Office of the Trustee as one such office or agency of the Company in accordance
with Section 2.03 hereof.

 

Section 4.03                                Reports.

 

(a)                                  Whether or not required by the
rules and regulations of the SEC, so long as any Notes are outstanding, the
Company will furnish to the Holders of Notes or cause the Trustee to furnish to
the Holders of Notes, within the time periods specified in the SEC’s rules and
regulations:

 

(1)                                  all quarterly and annual reports
that would be required to be filed with the SEC on Forms 10-Q and 10-K if the
Company were required to file reports, including a “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” and,
with respect to the annual information only, a report thereon by the Company’s
independent registered public accounting firm; and

 

46

 

(2)                                  all current reports that would be
required to be filed with the SEC on Form 8-K if the Company were required to
file such reports;

 

provided, however, that the availability of the
foregoing materials on the SEC’s EDGAR service or on the Company’s website
shall be deemed to satisfy the Company’s delivery obligations under this
Section 4.03(a).

 

All such reports will be prepared in all material
respects in accordance with all of the rules and regulations applicable to such
reports.  Each annual report on Form 10-K
will include a report on the Company’s consolidated financial statements by the
Company’s independent registered public accounting firm. In addition, the Company
will file a copy of each of the reports referred to in clauses (1) and (2)
above with the SEC for public availability within the time periods specified in
the rules and regulations applicable to such reports (unless the SEC will not
accept such a filing) and will make such information available to securities
analysts and prospective investors upon request.  The Company will at all times comply with TIA
§ 314(a).

 

If, at any time, the Company is no longer subject to
the periodic reporting requirements of the Exchange Act for any reason, the
Company will nevertheless continue filing the reports specified in the
preceding paragraph with the SEC within the time periods specified above unless
the SEC will not accept such a filing. 
The Company will not take any action for the purpose of causing the SEC
not to accept any such filings.  If,
notwithstanding the foregoing, the SEC will not accept the Company’s filings
for any reason, the Company will post the reports referred to in the preceding
paragraph on its website within the time periods that would apply if the
Company were required to file those reports with the SEC.

 

(b)                                 If the Company has designated any
of its Subsidiaries as Unrestricted Subsidiaries, then the quarterly and annual
financial information required by paragraph (a) of this Section 4.03
will include a reasonably detailed presentation, either on the face of the
financial statements or in the footnotes thereto, and in Management’s
Discussion and Analysis of Financial Condition and Results of Operations, of
the financial condition and results of operations of the Company and its
Restricted Subsidiaries separate from the financial condition and results of
operations of the Unrestricted Subsidiaries of the Company.

 

For so long as any Notes remain outstanding, if at any
time they are not required to file with the SEC the reports required by
paragraphs (a) and (b) of this Section 4.03, the Company and the
Guarantors will furnish to Holders and to securities analysts and prospective
investors, upon their request, the information required to be delivered
pursuant to Rule 144A(d)(4) under the Securities Act.

 

Delivery of such reports, information and documents to
the Trustee is for informational purposes only and the Trustee’s receipt of
such shall not constitute

 

47

 

constructive notice of
any information contained therein or determinable from information contained
therein, including the Company’s compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officers’
Certificates).

 

Section 4.04                                Compliance Certificate.

 

(a)                                  The Company and each Guarantor (to
the extent that such Guarantor is so required under the TIA) shall deliver to
the Trustee, within 90 days after the end of each fiscal year, an Officers’
Certificate stating that a review of the activities of the Company and its
Subsidiaries during the preceding fiscal year has been made under the
supervision of the signing Officers with a view to determining whether the
Company has kept, observed, performed and fulfilled its obligations under this
Indenture, and further stating, as to each such Officer signing such
certificate, that to the best of his or her knowledge the Company has kept,
observed, performed and fulfilled each and every covenant contained in this
Indenture and is not in default in the performance or observance of any of the
terms, provisions and conditions of this Indenture (or, if a Default or Event
of Default has occurred, describing all such Defaults or Events of Default of
which he or she may have knowledge and what action the Company is taking or
proposes to take with respect thereto) and that to the best of his or her
knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of or interest, if any, on the Notes is
prohibited or if such event has occurred, a description of the event and what
action the Company is taking or proposes to take with respect thereto.

 

(b)                                 So long as not contrary to the then
current recommendations of the American Institute of Certified Public
Accountants, the year-end financial statements delivered pursuant to
Section 4.03 above shall be accompanied by a written statement of the
Company’s independent public accountants (who shall be a firm of established
national reputation) that in making the examination necessary for certification
of such financial statements, nothing has come to their attention that would
lead them to believe that the Company has violated any provisions of Article 4
or Article 5 hereof or, if any such violation has occurred, specifying the
nature and period of existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any Person for any
failure to obtain knowledge of any such violation.

 

(c)                                  So long as any of the Notes are
outstanding, the Company will deliver to the Trustee, forthwith (and in any
event within 10 days) upon any Officer becoming aware of any Default or Event
of Default, an Officers’ Certificate specifying such Default or Event of
Default and what action the Company is taking or proposes to take with respect
thereto.

 

48

 

Section 4.05                                Taxes.

 

The Company will pay, and will cause each of its
Subsidiaries to pay, prior to delinquency, all material taxes, assessments, and
governmental levies except such as are contested in good faith and by
appropriate proceedings or where the failure to effect such payment is not
adverse in any material respect to the Holders of the Notes.

 

Section 4.06                                Stay, Extension and Usury Laws.

 

The Company and each of the Guarantors covenants (to
the extent that it may lawfully do so) that it will not at any time insist
upon, plead, or in any manner whatsoever claim or take the benefit or advantage
of, any stay, extension or usury law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture; and the Company and each of the Guarantors (to the extent that it
may lawfully do so) hereby expressly waives all benefit or advantage of any
such law, and covenants that it will not, by resort to any such law, hinder,
delay or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no such law
has been enacted.

 

Section 4.07                                Restricted Payments.

 

(a)                                  The Company will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly:

 

(1)                                  declare or pay any dividend or make
any other payment or distribution on account of the Company’s or any of its
Restricted Subsidiaries’ Equity Interests (including, without limitation, any
payment in connection with any merger or consolidation involving the Company or
any of its Restricted Subsidiaries) or to the direct or indirect holders of the
Company’s or any of its Restricted Subsidiaries’ Equity Interests in their
capacity as such (other than dividends or distributions payable in Equity
Interests (other than Disqualified Stock) of the Company and other than dividends
or distributions payable to the Company or a Restricted Subsidiary of the
Company);

 

(2)                                  purchase, redeem or otherwise
acquire or retire for value (including without limitation, in connection with
any merger or consolidation involving the Company) any Equity Interests (other
than any such Equity Interest owned by a wholly owned Restricted Subsidiary of
the Company) of the Company or any direct or indirect parent of the Company;

 

(3)                                  make any Restricted Investment (all
such payments and other actions set forth in these clauses (1) through (3)
being collectively referred to as “Restricted Payments”),

 

49

 

unless, at the time of and after giving effect to such
Restricted Payment, no Default or Event of Default has occurred and is
continuing or would occur as a consequence of such Restricted Payment and:

 

(1)                                  if the Fixed Charge Coverage Ratio
for the Company’s four most recent fiscal quarters for which internal financial
statements are available is not less than 1.6 to 1.0, such Restricted Payment,
together with the aggregate amount of all other Restricted Payments made by the
Company and its Restricted Subsidiaries since the date hereof (except for
Restricted Payments made pursuant to Section 4.07(b)(1) (so long as such
Restricted Payment was previously included for purposes of this calculation (to
the extent required to be so included) at the time of its declaration),
4.07(b)(2), 4.07(b)(5), 4.07(b)(9), 4.07(b)(11), 4.07(b)(12) or 4.07(b)(13)
below) is less than the sum, without duplication of:

 

(a)                                  Excess Cash of the Company for the
period (taken as one accounting period) from and including the first fiscal
quarter beginning after the date hereof to the end of the Company’s most
recently ended fiscal quarter for which internal financial statements are
available at the time of such Restricted Payment; plus

 

(b)                                 100% of the aggregate net cash
proceeds received by the Company since the date hereof as a contribution to its
common equity capital or from the issue or sale of Equity Interests of the
Company (other than Disqualified Stock) or from the issue or sale of
convertible or exchangeable Disqualified Stock or convertible or exchangeable
debt securities of the Company that have been converted into or exchanged for such
Equity Interests (other than Equity Interests (or Disqualified Stock or debt
securities) sold to a Subsidiary of the Company); plus

 

(c)                                  100% of the Fair Market Value as of
the date of issuance of any Equity Interests (other than Disqualified Stock) issued
since the date of this Indenture by the Company as consideration for the
purchase by the Company or any of its Restricted Subsidiaries of all or
substantially all of the assets of, or a majority of the Voting Stock of,
another Permitted Business (including by means of a merger, consolidation or
other business combination permitted under this Indenture); plus

 

(d)                                 to the extent that any Restricted
Investment that was made after the date of this Indenture is sold for cash or
other property or otherwise liquidated or repaid for cash, the lesser of
(i) the cash return of capital with respect to such Restricted Investment
or the Fair Market Value of such other property (less the cost of disposition,
if any) and (ii) the initial amount of such Restricted Investment; plus

 

50

 

(e)                                  to the extent that any Unrestricted
Subsidiary of the Company designated as such after the date of this Indenture
is redesignated as a Restricted Subsidiary after the date of this Indenture or
merges or consolidates with or into, or is liquidated into, the Company or any
of its Restricted Subsidiaries, the lesser of (i) the Fair Market Value of
the Company’s Investment in such Subsidiary as of the date of such
redesignation or (ii) such Fair Market Value as of the date on which such
Subsidiary was originally designated as an Unrestricted Subsidiary after the
date of this Indenture (the amount determined at any time pursuant to items
(b), (c), (d) and (e) being referred to as the “Incremental Funds”);
minus

 

(f)                                    the aggregate amount of Restricted
Payments made in reliance on Incremental Funds pursuant to this clause (1)
or clause (2) below; or

 

(2)                                  if the Fixed Charge Coverage Ratio
for the Company’s four most recent fiscal quarters for which internal financial
statements are available is less than 1.6 to 1.0, such Restricted Payment,
together with the aggregate amount of all other Restricted Payments made by the
Company and its Restricted Subsidiaries since the beginning of the fiscal quarter
in which such Restricted Payment is made (such Restricted Payments for purposes
of this clause (2) meaning only distributions on the Company’s common
stock), is less than the sum, without duplication, of:

 

(a)                                  $10.0 million less the
aggregate amount of all Restricted Payments made by the Company pursuant to
this clause (2)(a) during the period ending on the last day of the fiscal
quarter of the Company immediately preceding the fiscal quarter in which such
Restricted Payment is made and beginning on the date of this Indenture, plus

 

(b)                                 Incremental Funds to the extent not
previously expended pursuant to this clause (2) or clause (1) above;

 

provided that only Restricted
Payments that are distributions on the Company’s common stock may be made
pursuant to this clause (2).

 

(b)                                 The
preceding provisions will not prohibit:

 

(1)                                  the payment of any dividend or the
consummation of any irrevocable redemption within 60 days after the date of
declaration of the dividend or giving of the redemption notice, as the case may
be, if at the date of declaration or notice, the dividend or redemption payment
would have complied with the provisions of this Indenture;

 

51

 

(2)                                  so long as no Default has occurred
and is continuing or would be caused thereby, the making of any Restricted
Payment in exchange for, or out of the net cash proceeds of the sale within 10
Business Days (other than to a Subsidiary of the Company) of, Equity Interests
of the Company (other than Disqualified Stock) or from the contribution of
common equity capital to the Company within 10 Business Days; provided that the amount of any such net cash proceeds that
are utilized for any such Restricted Payment will be excluded from
clause (1)(b) of Section 4.07(a);

 

(3)                                  the payment of any dividend (or, in
the case of any partnership or limited liability company, any similar
distribution) by a Restricted Subsidiary of the Company to the holders of its
Equity Interests on a pro rata basis;

 

(4)                                  so long as no Default has occurred
and is continuing or would be caused thereby, the repurchase, redemption or
other acquisition or retirement for value of any Equity Interests of the
Company or any Restricted Subsidiary of the Company held by any current or
former officer, director or employee of the Company or any of its Restricted
Subsidiaries pursuant to any equity subscription agreement, stock option plan
or any other management or employee benefit plan or agreement, shareholders’
agreement or similar agreement; provided that
the aggregate price paid for all such repurchased, redeemed, acquired or
retired Equity Interests may not exceed $2.0 million in any calendar year;
provided, further, that such amount in
any calendar year may be increased by an amount not to exceed the cash proceeds
received by the Company or any of its Restricted Subsidiaries (to the extent
contributed to the Company) from sales of Equity Interests (other than
Disqualified Stock) of the Company to officers, directors or employees of the
Company or any of its Restricted Subsidiaries that occur after the date of this
Indenture (provided that the amount of such cash
proceeds used for any such repurchase, redemption, acquisition or retirement
will not increase the amount available for Restricted Payments under
clause (1)(b) of Section 4.07(a) hereof and provided that
the Company may elect to apply all or any portion of the aggregate increase
contemplated by this proviso in any calendar year); provided,
further, that cancellation of Indebtedness owing to the Company from
members of management of the Company or any Restricted Subsidiary in connection
with a repurchase of Equity Interests of the Company will not be deemed to
constitute a Restricted Payment;

 

(5)                                  so long as no Default has occurred
and is continuing or would be caused thereby, the repurchase of Equity
Interests deemed to occur upon the exercise of stock options to the extent such
Equity Interests represent a portion of the exercise price of those stock
options;

 

(6)                                  so long as no Default has occurred and
is continuing or would be caused thereby, the declaration and payment of
regularly scheduled or accrued

 

52

 

dividends to holders of any class or series of Disqualified Stock
of the Company or any Restricted Subsidiary of the Company issued on or after
the date of this Indenture in accordance with Section 4.09 hereof;

 

(7)                                  repurchases of Capital Stock deemed
to occur upon the exercise of stock options if the Capital Stock represents a
portion of the exercise price thereof;

 

(8)                                  payments of dividends to the
Company solely to enable it to make payments to holders of its Capital Stock in
lieu of the issuance of fractional shares of its Capital Stock;

 

(9)                                  so long as no Default has occurred
and is continuing or would be caused thereby, the acquisition of any shares of
Disqualified Stock of the Company in exchange for other shares of Disqualified
Stock of the Company or with the net cash proceeds from an issuance of
Disqualified Stock by the Company within 10 Business Days of such issuance, in
each case that is permitted to be issued under Section 4.09 hereof;

 

(10)                            so long as no Default has occurred
and is continuing or would be caused thereby, the First Four Dividend Payments;

 

(11)                            so
long as no Default has occurred and is continuing or would be caused thereby,
the repurchase of shares of the Company’s Class B Common Stock on the date
hereof or on the closing date(s) of the exercise of the over-allotment option
with respect to the EISs;

 

(12)                            so long as no Default has occurred
and is continuing or would be caused thereby, other Restricted Payments in an
aggregate amount not to exceed $10.0 million since the date of this
Indenture;

 

(13)                            so long as no Default has occurred
and is continuing or would be caused thereby, the repurchase of shares of the
Company’s Class B Common Stock issued on or before the date hereof with the
proceeds of an issuance of EISs or, if no EISs are outstanding on the date of
repurchase, the issuance of Additional Notes and the Company’s Class A Common
Stock, in either case completed substantially contemporaneously with the
repurchase, and, in respect of any Additional Notes, incurred pursuant to
Section 4.09(b)(19), provided
that such transactions may only be consummated in accordance with the
Securities Holders Agreement, provided,
further, that the amount of any such net cash proceeds that are
utilized for any such Restricted Payment will be excluded from
Section 4.07(a)(1)(b) hereof; and

 

53

 

(14)                            the repurchase, redemption,
defeasance or other acquisition or retirement for value of the Company’s 9 5/8%
senior subordinated notes due 2007.

 

(c)                                  If
the Company’s Net Cash Balance is less than $10.0 million at the end of
any fiscal year beginning with the fiscal year ended January 1, 2005, then
until the earlier of (a) the first fiscal year end thereafter at which the
Company’s Net Cash Balance equals or exceeds $10.0 million and
(b) the first fiscal quarter end thereafter at which the Company’s Net
Cash Balance equals or exceeds $12.5 million, the amount of Excess Cash
that the Company Foods may use to make dividends or other distributions on its
common stock pursuant to the second clause (1) of the first paragraph of
this Section 4.07(a) hereof shall be reduced to 98.0% thereof.

 

(d)                                 For
purposes of this covenant, the amount of all Restricted Payments (other than
cash) will be the Fair Market Value on the date of the Restricted Payment of
the asset(s) or securities proposed to be transferred or issued by the Company
or such Restricted Subsidiary, as the case may be, pursuant to the Restricted
Payment.  The Fair Market Value of any
assets or securities that are required to be valued by Section 4.07 will
be determined by the Board of Directors of the Company whose resolution with
respect thereto will be delivered to the Trustee to the extent that such Fair
Market Value exceeds $10.0 million. 
For purposes of determining compliance with Section 4.07, in the
event that a Restricted Payment meets the criteria of more than one of the
exceptions described in Section 4.07(b) or is entitled to be made pursuant
to Section 4.07(a) hereof, the Company will be permitted, in its sole
discretion, to classify the Restricted Payment in any manner that complies with
Section 4.07.

 

Section 4.08                                Dividend and Other Payment
Restrictions Affecting Subsidiaries.

 

(a)                                  The Company will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly, create or
permit to exist or become effective any consensual encumbrance or restriction
on the ability of any Restricted Subsidiary to:

 

(1)                                  pay dividends or make any other
distributions on its Capital Stock to the Company or any of its Restricted
Subsidiaries or with respect to any other interest or participation in, or
measured by, its profits, or pay any indebtedness owed to the Company or any of
its Restricted Subsidiaries;

 

(2)                                  make loans or advances to the
Company or any of its Restricted Subsidiaries; or

 

(3)                                  transfer any of its properties or
assets to the Company or any of its Restricted Subsidiaries.

 

54

 

(b)                                 However, the preceding restrictions
in Section 4.08(a) hereof will not apply to encumbrances or restrictions
existing under or by reason of:

 

(1)                                  agreements governing Existing
Indebtedness and any other agreement, including Credit Facilities and the
Senior Note Indenture as in effect on the date of this Indenture and any
amendments, restatements, modifications, renewals, increases, supplements,
refundings, replacements or refinancings of those agreements; provided that the amendments, restatements, modifications,
renewals, increases, supplements, refundings, replacements or refinancings are
not materially more restrictive, taken as a whole, with respect to such
dividend and other payment restrictions than those contained in those
agreements on the date of this Indenture;

 

(2)                                  this Indenture, the Notes and the
Note Guarantees; and the Senior Notes and the Senior Notes Guarantees;

 

(3)                                  applicable law, rule, regulation or
order;

 

(4)                                  any instrument governing
Indebtedness or Capital Stock of a Person acquired by the Company or any of its
Restricted Subsidiaries as in effect at the time of such acquisition (except to
the extent such Indebtedness or Capital Stock was incurred in connection with
or in contemplation of such acquisition), which encumbrance or restriction is
not applicable to any Person, or the properties or assets of any Person, other
than the Person, or the property or assets of the Person, so acquired; provided that, in the case of Indebtedness, such
Indebtedness was permitted by the terms of this Indenture to be incurred;

 

(5)                                  customary non-assignment provisions
in contracts, licenses and other commercial agreements entered into in the
ordinary course of business;

 

(6)                                  purchase money obligations for
property acquired in the ordinary course of business and Capital Lease
Obligations that impose restrictions on the property purchased or leased of the
nature described in clause (3) of Section 4.08(a) hereof;

 

(7)                                  any agreement for the sale or other
disposition of all or substantially all of the Capital Stock or assets of a
Restricted Subsidiary that restricts distributions by that Restricted
Subsidiary pending the sale or other disposition;

 

(8)                                  Permitted Refinancing Indebtedness;
provided that the encumbrances or
restrictions contained in the agreements governing such Permitted Refinancing
Indebtedness are, in the good faith judgment of the senior management or Board
of Directors of the Company, not materially more

 

55

 

restrictive, taken as a whole, than those contained in the
agreements governing the Indebtedness being refinanced;

 

(9)                                  any restriction on the transfer of
assets under any Lien permitted under this Indenture imposed by the holder of
the Lien;

 

(10)                            provisions limiting the disposition
or distribution of assets or property in joint venture agreements, asset sale
agreements, sale-leaseback agreements, stock sale agreements and other similar
agreements entered into in the ordinary course of business or with the approval
of the Company’s Board of Directors, which limitation is applicable only to the
assets that are the subject of such agreements; and

 

(11)                            restrictions on cash or other
deposits or net worth imposed by customers under contracts entered into in the
ordinary course of business.

 

Section 4.09                                Incurrence of Indebtedness and
Issuance of Preferred Stock.

 

(a)                                  The Company will not, and will not
permit any of its Restricted Subsidiaries to, directly or indirectly, create,
incur, issue, assume, guarantee or otherwise become directly or indirectly
liable, contingently or otherwise, with respect to (collectively, “incur”) any Indebtedness (including
Acquired Debt), and the Company will not issue any Disqualified Stock and will
not permit any of its Restricted Subsidiaries to issue any shares of preferred
stock; provided, however,
that the Company may incur Indebtedness (including Acquired Debt) or issue
Disqualified Stock, and the Guarantors may incur Indebtedness (including
Acquired Debt) or issue preferred stock, if the Fixed Charge Coverage Ratio for
the Company’s most recently ended four full fiscal quarters for which internal
financial statements are available immediately preceding the date on which such
additional Indebtedness is incurred or such Disqualified Stock or such
preferred stock is issued, as the case may be, would have been at least 2.0 to
1, determined on a pro forma basis (including a pro forma application of the
net proceeds therefrom), as if the additional Indebtedness had been incurred or
the Disqualified Stock or the preferred stock had been issued, as the case may
be, at the beginning of such four-quarter period.

 

(b)                                 The provisions of
Section 4.09(a) hereof will not prohibit the incurrence of any of the
following items of Indebtedness (collectively, “Permitted Debt”):

 

(1)                                  the incurrence by the Company and
any of its Restricted Subsidiaries of Indebtedness and letters of credit under
Credit Facilities in an aggregate principal amount at any one time outstanding
under this clause (1) (with letters of credit being deemed to have a
principal amount equal to the maximum potential liability of the Company and
its Restricted Subsidiaries thereunder) not

 

56

 

to exceed the greater of (x) $50.0 million and
(y) the amount of the Borrowing Base as of the date of such incurrence;

 

(2)                                  the incurrence by the Company and
its Restricted Subsidiaries of the Existing Indebtedness;

 

(3)                                  the incurrence by the Company and
the Guarantors of Indebtedness represented by the Notes and the related Note
Guarantees to be issued on the date of this Indenture;

 

(4)                                  the incurrence by the Company and
the Guarantors of Indebtedness represented by the Senior Notes and the Senior
Note Guarantees;

 

(5)                                  the incurrence by the Company or
any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease
Obligations, mortgage financings or purchase money obligations, in each case
incurred for the purpose of financing all or any part of the purchase price or
cost of design, construction, installation or improvement of property, plant or
equipment used in the business of the Company or any of its Restricted
Subsidiaries (whether through the direct purchase of assets or the Equity
Interests of any Person owning such assets), in an aggregate principal amount,
including all Permitted Refinancing Indebtedness incurred to renew, refund,
refinance, replace, defease or discharge any Indebtedness incurred pursuant to this
clause (5), not to exceed $20.0 million at any time outstanding;

 

(6)                                  the incurrence by the Company or
any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in
exchange for, or the net proceeds of which are used to renew, refund, refinance,
replace, defease or discharge any Indebtedness (other than intercompany
Indebtedness) that was permitted by this Indenture to be incurred by
Section 4.09(a) or clauses (2), (3), (4), (5), (6), (17) or (18) of
this Section 4.09(b);

 

(7)                                  the incurrence by the Company or
any of its Restricted Subsidiaries of intercompany Indebtedness between or
among the Company and any of its Restricted Subsidiaries; provided,
however, that:

 

(a)                                  if the Company or any Guarantor is
the obligor on such Indebtedness and the payee is not the Company or a
Guarantor, such Indebtedness must be expressly subordinated to the prior
payment in full in cash of all Obligations then due with respect to the Notes,
in the case of the Company, or the Note Guarantee, in the case of a Guarantor;
and

 

(b)                                 (i) any subsequent issuance or
transfer of Equity Interests that results in any such Indebtedness being held
by a Person other than the

 

57

 

Company or a Restricted Subsidiary of the Company and
(ii) any sale or other transfer of any such Indebtedness to a Person that
is not either the Company or a Restricted Subsidiary of the Company, will be
deemed, in each case, to constitute an incurrence of such Indebtedness by the
Company or such Restricted Subsidiary, as the case may be, that was not
permitted by this clause (7);

 

(8)                                  the issuance by any of the
Company’s Restricted Subsidiaries to the Company or to any of its Restricted
Subsidiaries of shares of preferred stock; provided, however,
that:

 

(a)                                  any subsequent issuance or transfer
of Equity Interests that results in any such preferred stock being held by a
Person other than the Company or a Restricted Subsidiary of the Company; and

 

(b)                                 any sale or other transfer of any
such preferred stock to a Person that is not either the Company or a Restricted
Subsidiary of the Company,

 

will be deemed, in each case, to constitute an
issuance of such preferred stock by such Restricted Subsidiary that was not
permitted by this clause (8);

 

(9)                                  the incurrence by the Company or
any of its Restricted Subsidiaries of Hedging Obligations in the ordinary
course of business;

 

(10)                            the guarantee by the Company or any
of its Restricted Subsidiaries of Indebtedness of the Company or a Restricted
Subsidiary of the Company that was permitted to be incurred by another
provision of this Section 4.09;

 

(11)                            the incurrence by the Company or
any of its Restricted Subsidiaries of Indebtedness in respect of bankers’
acceptances, performance, bid and surety bonds and completion guarantees
provided in the ordinary course of business;

 

(12)                            the incurrence by the Company or
any of its Restricted Subsidiaries of Indebtedness arising from the honoring by
a bank or other financial institution of a check, draft or similar instrument
inadvertently drawn against insufficient funds in the ordinary course of
business;

 

(13)                            the incurrence of Indebtedness
arising from agreements of the Company or any of its Restricted Subsidiaries
providing for indemnification, adjustment of purchase price or similar
obligations, in each case, incurred in connection with the disposition of any
business, assets or a Restricted Subsidiary, other than the Guarantees of
Indebtedness incurred by any Person acquiring all or

 

58

 

any portion of such business, assets or a Restricted Subsidiary
for the purpose of financing such acquisition; provided,
however, that:

 

(a)                                  such Indebtedness is not reflected
on the balance sheet of the Company or any Restricted Subsidiary (contingent
obligations referred to in a footnote to financial statements and not otherwise
reflected on the balance sheet will not be deemed to be reflected on such
balance sheet for purposes of this clause (a)); and

 

(b)                                 the maximum assumable liability in
respect of all such Indebtedness shall at no time exceed the gross proceeds
including non-cash proceeds (the Fair Market Value of such non-cash proceeds
being measured at the time received and without giving effect to any subsequent
changes in value) actually received by the Company and Restricted Subsidiaries
in connection with such disposition;

 

(14)                            the incurrence of Indebtedness owed
to any Person in connection with worker’s compensation, self-insurance, health,
disability or other employee benefits or property, casualty or liability
insurance provided by such Person to the Company or any of its Restricted
Subsidiaries, pursuant to reimbursement or indemnification obligations to such
Person, in each case incurred in the ordinary course of business and consistent
with past practices;

 

(15)                            pledges, deposits or payments made
or given in the ordinary course of business in connection with or to secure
statutory, regulatory or similar obligations, including obligations under
health, safety or environmental obligations, or arising from guarantees to
suppliers, lessors, licenses, contractors, franchisees or customers of
obligations, other than Indebtedness, made in the ordinary course of business;

 

(16)                            the incurrence of Indebtedness by
the Company or any of its Restricted Subsidiaries issued to directors, officers
or employees of the Company or any of its Restricted Subsidiaries in connection
with the redemption or purchase of Capital Stock that, by its terms, is
subordinated to the Notes, is not secured by any assets of the Company or any
of its Restricted Subsidiaries and does not require cash payments prior to the
Stated Maturity of the Notes, in an aggregate principal amount at any time
outstanding not to exceed $2.0 million;

 

(17)                            the incurrence by the Company or
any of its Restricted Subsidiaries of additional Indebtedness in an aggregate
principal amount (or accreted value, as applicable) at any time outstanding,
including all Permitted Refinancing Indebtedness incurred to renew, refund,
refinance, replace, defease or discharge any Indebtedness incurred pursuant to
this clause (17), not to exceed $20.0 million;

 

59

 

(18)                            the
incurrence of Indebtedness by the Company or any Restricted Subsidiary to
finance the acquisition (including, without limitation, by way of a merger) of
Capital Stock of any Person engaged in, or assets used or useful in, a
Permitted Business; provided that the Fixed Charge Coverage Ratio for the
Company’s most
recently ended four full fiscal quarters for which internal financial
statements are available immediately preceding the date on which such
Indebtedness is incurred would have been at least 1.75 to 1.0 determined on a
pro-forma basis (including a pro forma application of the net proceeds
therefrom), as if the Indebtedness had been incurred at the beginning of such
four-quarter period; and

 

(19)                            the incurrence by the
Company of Indebtedness in the form of Additional Notes in connection with the
issuance of EISs or, if there are no EISs outstanding on the date of such
issuance, the issuance of the Company’s Class A Common Stock (and in each case,
the incurrence of the related Note Guarantees in respect of such Additional
Notes by the Guarantors), provided
that (a) no Default or Event of Default has occurred and is continuing at the
time of such issuance or would be caused thereby, (b) the ratio of the
aggregate principal amount of such Additional Notes over the number of
additional shares of the Company’s Class A Common Stock issued contemporaneously
therewith shall not exceed (i) the equivalent ratio with respect to the EISs
outstanding immediately prior to such issuance, or (ii) if there are no EISs
outstanding immediately prior to such issuance, the equivalent ratio with
respect to the EISs outstanding on the date of this Indenture, and (c) the
Company uses the proceeds of such issuance solely to repurchase shares of Class
B Common Stock issued on or before the date of this Indenture from holders
thereof in accordance with the Securities Holders Agreement.

 

For purposes of determining compliance with this
Section 4.09, in the event that an item of proposed Indebtedness meets the
criteria of more than one of the categories of Permitted Debt described in
clauses (1) through (19) above, or is entitled to be incurred pursuant to
Section 4.09(a) hereof, the Company will be permitted to classify such
item of Indebtedness on the date of its incurrence, or later reclassify all or
a portion of such item of Indebtedness, in any manner that complies with this
Section 4.09 and such item of Indebtedness will be treated as having been
incurred pursuant to only such clause or clauses to which it has been
reclassified or pursuant to Section 4.09(a), as the case may be.  Indebtedness under Credit Facilities outstanding
on the date on which Notes are first issued and authenticated under this
Indenture will initially be deemed to have been incurred on such date in
reliance on the exception provided by clause (1) of the definition of
Permitted Debt.  The accrual of interest,
the accretion or amortization of original issue discount, the payment of
interest on any Indebtedness in the form of additional Indebtedness with the
same terms, the reclassification of preferred stock as Indebtedness due to a
change in account principles, and the payment of dividends on Disqualified

 

60

 

Stock in the form of
additional shares of the same class of Disqualified Stock will not be deemed to
be an incurrence of Indebtedness or an issuance of Disqualified Stock for
purposes of this Section 4.09. 
Notwithstanding any other provision of this Section 4.09, the
maximum amount of Indebtedness that the Company or any Restricted Subsidiary
may incur pursuant to this Section 4.09 shall not be deemed to be exceeded
solely as a result of fluctuations in exchange rates or currency values.

 

The amount of any Indebtedness outstanding as of any
date will be:

 

(1)                                  the
accreted value of the Indebtedness, in the case of any Indebtedness issued with
original issue discount;

 

(2)                                  the
principal amount of the Indebtedness, in the case of any other Indebtedness;
and

 

(3)                                  in
respect of Indebtedness of another Person secured by a Lien on the assets of
the specified Person, the lesser of:

 

(A)                              the
Fair Market Value of such assets at the date of determination; and

 

(B)                                the
amount of the Indebtedness of the other Person.

 

Section 4.10                                Asset Sales.

 

(a)                                  The
Company will not, and will not permit any of its Restricted Subsidiaries to,
consummate an Asset Sale unless:

 

(1)                                  the Company (or the Restricted
Subsidiary, as the case may be) receives consideration at the time of the Asset
Sale at least equal to the Fair Market Value of the assets or Equity Interests
issued or sold or otherwise disposed of; and

 

(2)                                  at least 75% of the consideration
received in the Asset Sale by the Company or such Restricted Subsidiary is in
the form of cash or Cash Equivalents. 
For purposes of this provision, each of the following shall be deemed to
be cash:

 

(A)                              any liabilities, as shown on the
Company’s most recent consolidated balance sheet, of the Company or any
Restricted Subsidiary (other than contingent liabilities and liabilities that
are by their terms subordinated to the Notes or any Note Guarantee) that are
assumed by the transferee of any such assets and the Company or such Restricted
Subsidiary is released from further liability;

 

61

 

(B)                                any securities, notes or other
obligations received by the Company or any such Restricted Subsidiary from such
transferee that are converted by the Company or such Restricted Subsidiary into
cash within 180 days after such Asset Sale, to the extent of the cash received
in that conversion; and

 

(C)                                any stock or assets of the kind
referred to in clauses (2) or (4) of the next paragraph of this
Section 4.10.

 

(b)                                 Any
Asset Sale pursuant to a condemnation, appropriation or other similar taking,
including by deed in lieu of condemnation, or pursuant to the foreclosure or
other enforcement of a Permitted Lien or exercise by the related lienholder of
rights with respect to any of the foregoing, including by deed or assignment in
lieu of foreclosure, will not be required to satisfy the conditions set forth
in the preceding paragraph.  Within 360
days after the receipt of any Net Proceeds from an Asset Sale, the Company (or
the applicable Restricted Subsidiary, as the case may be) may apply such Net
Proceeds at its option:

 

(1)                                  to repay, prepay or purchase
Senior Indebtedness or pari passu Indebtedness
(provided that if the Company shall so repay pari
passu Indebtedness, it will equally and ratably repay the Notes by
making an offer (in accordance with the procedures set forth in
Section 3.09) to all Holders to purchase at a purchase price equal to 100%
of the principal amount thereof, plus accrued and unpaid interest, if any, the
pro rata principal amount of Notes); and, if the Indebtedness repaid is
revolving credit Indebtedness, to correspondingly reduce commitments with
respect thereto;

 

(2)                                  to
acquire all or substantially all of the assets of another Permitted Business,
or to acquire any Capital Stock of another Permitted Business, if, after giving
effect to any such acquisition of Capital Stock, the Permitted Business is or
becomes a Restricted Subsidiary of the Company;

 

(3)                                  to
make a capital expenditure;

 

(4)                                  to
acquire other assets that are not classified as current assets under GAAP and
that are used or useful in a Permitted Business; or

 

(5)                                  any
combination of the foregoing clauses (1) through (4).

 

In the case of clauses (2) and (4) of this
paragraph (b), the Company will be deemed to have complied with its obligations
in the preceding paragraph if it enters into a binding commitment to acquire
such assets or Capital Stock prior to 360 days after the receipt of the
applicable Net Proceeds; provided that
such binding commitment will be subject only to customary conditions and such
acquisition is completed within 180 days

 

62

 

following the expiration
of the aforementioned 360 day period.  If
the acquisition contemplated by such binding commitment is not consummated on
or before such 180th day, and the Company has not applied the applicable Net
Proceeds for another purpose permitted by the preceding paragraph on or before
such 180th day, such commitment shall be deemed not have been a permitted
application of Net Proceeds.  Pending the
final application of any Net Proceeds, the Company may temporarily reduce
revolving credit borrowings or otherwise invest the Net Proceeds in any manner
that is not prohibited by this Indenture.

 

Any Net Proceeds from Asset Sales that are not applied
or invested as provided in the second paragraph of this Section 4.10 will
constitute “Excess Proceeds.” 
When the aggregate amount of Excess Proceeds exceeds $10.0 million,
within 30 days thereof, the Company will make an Asset Sale Offer to all
Holders of Notes and all Holders of other Indebtedness that is pari passu Indebtedness containing
provisions similar to those set forth herein with respect to offers to purchase
or redeem with the proceeds of sales of assets to purchase the maximum
principal amount of Notes and such other pari
passu Indebtedness that may be purchased out of the Excess
Proceeds.  The offer price in any Asset
Sale Offer will be equal to 100% of the principal amount plus accrued and
unpaid interest to the date of purchase and will be payable in cash.  If any Excess Proceeds remain after
consummation of an Asset Sale Offer, the Company may use those Excess Proceeds
for any purpose not otherwise prohibited by this Indenture. If the aggregate
principal amount of Notes and such other pari
passu Indebtedness tendered into such Asset Sale Offer exceeds the
amount of Excess Proceeds, the Trustee will select the Notes to be purchased on
a pro rata basis.  Upon completion of each Asset Sale Offer, the
amount of Excess Proceeds will be reset at zero.  In order for a Holder of Notes whose Notes
are represented by EISs to exercise its repurchase right in connection with an
Asset Sale Offer pursuant to this Section 4.10, such Holder must
voluntarily separate its EISs representing such Notes.

 

Any Asset Sale Offer will be made in compliance with
all applicable laws, rules and regulations, including, if applicable,
Regulation 14E under the Exchange Act and the rules thereunder and all other
applicable Federal and state securities laws. 
To the extent that the provisions of any securities laws or regulations
conflict with the provisions of this Section 4.10, the Company’s
compliance with those laws and regulations will not in and of itself cause a
breach of its obligations under this Section 4.10.

 

Section 4.11                                Transactions with Affiliates.

 

(a)                                  The Company will not, and will not
permit any of its Restricted Subsidiaries to, on or after the date of this
Indenture, make any payment to, or sell, lease, transfer or otherwise dispose
of any of its properties or assets to, or purchase any property or assets from,
or enter into or make or amend any transaction, contract, agreement,
understanding, loan, advance or guarantee with, or for the benefit of, any
Affiliate of the Company (each, an “Affiliate Transaction”),
unless:

 

63

 

(1)                                  the Affiliate Transaction is on
terms that are no less favorable to the Company or the relevant Restricted
Subsidiary than those that would have been obtained in a comparable transaction
by the Company or such Restricted Subsidiary with a Person that is not an
Affiliate of the Company; and

 

(2)                                  The Company delivers to the Trustee:

 

(A)                              with respect to any Affiliate
Transaction or series of related Affiliate Transactions involving aggregate
consideration in excess of $5.0 million, a resolution of the Board of
Directors of the Company set forth in an Officer’s Certificate certifying that
such Affiliate Transaction complies with this Section 4.11(a) and that
such Affiliate Transaction has been approved by a majority of the disinterested
members of the Board of Directors of the Company or, if none, a disinterested
representative appointed by the Board of Directors for such purpose; and

 

(B)                                with respect to any Affiliate
Transaction or series of related Affiliate Transactions involving aggregate
consideration in excess of $20.0 million, an opinion as to the fairness to
the Company or such Subsidiary of such Affiliate Transaction from a financial
point of view or that such Affiliate Transaction is not less favorable to the
Company and its Restricted Subsidiaries than could reasonably be expected to be
obtained in a comparable transaction with a Person that is not an Affiliate of
the Company, as issued by an accounting, appraisal or investment banking firm
of national standing.

 

(b)                                 The following items will not be
deemed to be Affiliate Transactions and, therefore, will not be subject to the
provisions of Section 4.11(a) hereof:

 

(1)                                  any employment agreement, officer
or director indemnification agreement or any similar arrangement entered into
by the Company or any of its Restricted Subsidiaries in the ordinary course of
business and payments pursuant thereto;

 

(2)                                  transactions between or among the
Company and/or its Restricted Subsidiaries;

 

(3)                                  transactions with a Person (other
than an Unrestricted Subsidiary of the Company) that is an Affiliate of the
Company solely because the Company owns, directly or through a Restricted
Subsidiary, an Equity Interest in, or controls, such Person;

 

(4)                                  fees and compensation paid to
officers and employees of the Company or any Restricted Subsidiaries, to the
extent such fees and compensation

 

64

 

are reasonable and customary, and payment of reasonable directors’
fees to Persons who are not otherwise Affiliates of the Company;

 

(5)                                  any issuance or sale of Equity
Interests (other than Disqualified Stock) of the Company to Affiliates,
employees, officers and directors of the Company or any of its Restricted
Subsidiaries;

 

(6)                                  Restricted Payments that are
permitted by Section 4.07 hereof;

 

(7)                                  fees payable to BRS or an Affiliate
of BRS under the Transaction Services Agreement;

 

(8)                                  maintenance in the ordinary course
of business of customary benefit programs or arrangements for employees,
officers or directors, including vacation plans, health and life insurance
plans, deferred compensation plans and retirement or savings plans and similar
plans;

 

(9)                                  loans or advances to employees in
the ordinary course of business not to exceed $1.0 million in the
aggregate at any one time outstanding;

 

(10)                            any agreement as in effect and
entered into as of the date of this Indenture, including the Securities Holders
Agreement, or any amendment thereto or any transaction contemplated thereby
(including pursuant to any amendment thereto) in any replacement agreement
thereto so long as any such amendment or replacement agreement is not more
disadvantageous to the Holders of the Notes in any material respect than the
original agreement as in effect on the date of this Indenture;

 

(11)                            any transaction or series of
transactions between the Company or any Restricted Subsidiary and any of their
Joint Ventures; provided that (a) such
transaction or series of transactions is in the ordinary course of business
between the Company or such Restricted Subsidiary and such Joint Venture and
(b) with respect to any such Affiliate Transaction involving aggregate
consideration in excess of $5.0 million, such Affiliate Transaction
complies with Section 4.11(a)(1) hereof and such Affiliate Transaction has
been approved by the Board of Directors of the Company;

 

(12)                            any service, purchase, lease,
supply or similar agreement entered into in the ordinary course of business
between the Company or any Restricted Subsidiary and any Affiliate that is a
customer, client, supplier or purchaser or seller of goods or services, so long
as the senior management or Board of Directors of the Company determines in
good faith that any such agreement is on terms no less favorable to the Company
or such Restricted Subsidiary than those

 

65

 

that could be obtained in a comparable arms’-length transaction
with an entity that is not an Affiliate; and

 

(13)                            the payment of all fees and
expenses related to the Transactions.

 

Section 4.12                                Liens.

 

The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, create, incur, assume or
suffer to exist any Lien of any kind (other than Permitted Liens) to secure
Indebtedness of any kind on any asset now owned or hereafter acquired, unless
all payments due under this Indenture and the Notes are secured on an equal and
ratable basis with the obligations so secured (or, if such obligations are
subordinated by their terms to the Notes or the Note Guarantees, prior to the
obligations so secured) until such time as such obligations are no longer
secured by a Lien.

 

Section 4.13                                Business Activities.

 

The Company will not, and will not permit any of its
Restricted Subsidiaries to, engage in any business other than Permitted
Businesses, except to such extent as would not be material to the Company and
its Restricted Subsidiaries taken as a whole, as reasonably determined in good
faith by the Board of Directors of the Company.

 

Section 4.14                                Corporate Existence.

 

Subject to Article 5 hereof, the Company shall do or
cause to be done all things necessary to preserve and keep in full force and
effect:

 

(1)                                  its corporate existence, and the
corporate, partnership or other existence of each of its Subsidiaries, in
accordance with the respective organizational documents (as the same may be
amended from time to time) of the Company or any such Subsidiary; and

 

(2)                                  the rights (charter and statutory),
licenses and franchises of the Company and its Subsidiaries; provided, however, that the Company shall not be required to
preserve any such right, license or franchise, or the corporate, partnership or
other existence of any of its Subsidiaries, if the Board of Directors shall
determine that the preservation thereof is no longer desirable in the conduct
of the business of the Company and its Subsidiaries, taken as a whole, and that
the loss thereof is not adverse in any material respect to the Holders of the
Notes.

 

Section 4.15                                Offer to Repurchase Upon Change
of Control.

 

(a)                                  If a Change of Control occurs, each
Holder of Notes will have the right to require the Company to repurchase all or
any part (equal to $7.15 or an integral multiple

 

66

 

of $7.15) of that
Holder’s Notes pursuant to a Change of Control Offer on the terms set forth
herein.  In the Change of Control Offer
(subject to the conditions required by applicable law, if any), the Company
will offer a Change of Control Payment in cash equal to 101% of the aggregate
principal amount of Notes repurchased plus
accrued and unpaid interest on the Notes repurchased to the date of purchase,
subject to the rights of Holders of Notes on the relevant record date to
receive interest due on the relevant interest payment date (the “Change of Control Payment”).  No earlier than ten and no later than 20 days
following any Change of Control, the Company will mail a notice to each Holder
describing the transaction or transactions that constitute the Change of
Control and stating:

 

(1)                                  that the Change of Control Offer is
being made pursuant to this Section 4.15 and that all Notes tendered will
be accepted for payment;

 

(2)                                  the purchase price and the purchase
date, which shall be no earlier than 30 days and no later than 60 days from the
date such notice is mailed (the “Change of Control Payment
Date”);

 

(3)                                  that any Note not tendered will
continue to accrue interest;

 

(4)                                  that, unless the Company defaults
in the payment of the Change of Control Payment, all Notes accepted for payment
pursuant to the Change of Control Offer will cease to accrue interest after the
Change of Control Payment Date;

 

(5)                                  that Holders electing to have any
Notes purchased pursuant to a Change of Control Offer will be required to
surrender the Notes, with the form entitled “Option
of Holder to Elect Purchase”
attached to the Notes completed, or transfer by book-entry transfer, to the
Paying Agent at the address specified in the notice prior to the close of
business on the third Business Day preceding the Change of Control Payment
Date;

 

(6)                                  that Holders will be entitled to
withdraw their election if the Paying Agent receives, not later than the close
of business on the second Business Day preceding the Change of Control Payment
Date, a telegram, telex, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of Notes delivered for purchase, and a
statement that such Holder is withdrawing his election to have the Notes
purchased; and

 

(7)                                  that Holders whose Notes are being
purchased only in part will be issued new Notes equal in principal amount to
the unpurchased portion of the Notes surrendered, which unpurchased portion
must be equal to $7.15 in principal amount or an integral multiple thereof.

 

67

 

In order for a Holder of Notes whose Notes are
represented by EISs to exercise its right to require the Company to repurchase
such Holder’s Notes pursuant to this Section 4.15, such Holder must
voluntarily separate its EISs representing such Notes.

 

The Company will comply with the requirements of Rule
14e-1 under the Exchange Act and any other securities laws and regulations
thereunder to the extent those laws and regulations are applicable in
connection with the repurchase of the Notes as a result of a Change in
Control.  To the extent that the
provisions of any securities laws or regulations conflict with the provisions
of Sections 3.09 or 4.15 hereof, the Company will comply with the applicable
securities laws and regulations and will not be deemed to have breached its
obligations under Section 3.09 hereof or this Section 4.15 by virtue
of such compliance.

 

(b)                                 On the Change of Control Payment
Date, the Company will, to the extent lawful:

 

(1)                                  accept for payment all Notes or
portions of Notes properly tendered pursuant to the Change of Control Offer;

 

(2)                                  deposit with the Paying Agent an
amount equal to the Change of Control Payment in respect of all Notes or
portions of Notes properly tendered; and

 

(3)                                  deliver or cause to be delivered to
the Trustee the Notes properly accepted together with an Officer’s Certificate
stating the aggregate principal amount of Notes or portions of Notes being
purchased by the Company.

 

The Paying Agent will promptly mail (but in any case
not later than five days after the Change of Control Payment Date) to each
Holder of Notes properly tendered the Change of Control Payment for such Notes,
and the Trustee will promptly authenticate and mail (or cause to be transferred
by book entry) to each Holder a new Note equal in principal amount to any
unpurchased portion of the Notes surrendered, if any.   The Company will publicly announce the
results of the Change of Control Offer on or as soon as practicable after the
Change of Control Payment Date.

 

Notwithstanding anything to the contrary in this
Section 4.15, the Company will not be required to make a Change of Control
Offer upon a Change of Control if (1) 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 Section 4.15 and Section 3.09 hereof and
purchases all Notes properly tendered and not withdrawn under the Change of
Control Offer, or (2) notice of redemption has been given pursuant to
Section 3.07 hereof, unless and until there is a default in payment of the
applicable redemption price.

 

68

 

In the event that at the time of such Change of
Control the terms of any Senior Indebtedness restrict or prohibit the
repurchase of notes pursuant to this covenant, then prior to the mailing of the
notice to holders provided for above but in any event within 90 days following
any Change of Control, the Company shall (i) repay in full all such Senior
Indebtedness or offer to repay in full all such Senior Indebtedness and repay
the Senior Indebtedness of each lender who has accepted such offer or (ii) obtain
the requisite consent under the agreements governing such Senior Indebtedness
to permit the repurchase of the Notes as provided in this Section 4.15.

 

Section 4.16                                Limitation on Sale and Leaseback
Transactions.

 

The Company will not, and will not permit any of its
Restricted Subsidiaries to, enter into any sale and leaseback transaction; provided that the Company or any Guarantor may enter into a
sale and leaseback transaction if:

 

(1)                                  the Company or that Guarantor, as
applicable, could have (a) incurred Indebtedness in an amount equal to the
Attributable Debt relating to such sale and leaseback transaction under the
Fixed Charge Coverage Ratio test in Section 4.09(a) hereof and
(b) incurred a Lien to secure such Indebtedness pursuant to the provisions
of Section 4.12 hereof;

 

(2)                                  the gross cash proceeds of that
sale and leaseback transaction are at least equal to the Fair Market Value of
the property that is the subject of that sale and leaseback transaction; and

 

(3)                                  the transfer of assets in that sale
and leaseback transaction is permitted by, and the Company applies the proceeds
of such transaction in compliance with, Section 4.10 hereof.

 

Section 4.17                                Payments for Consent.

 

The Company will not, and will not permit any of its
Restricted Subsidiaries to, directly or indirectly, pay or cause to be paid any
consideration to or for the benefit of any Holder of Notes for or as an
inducement to any consent, waiver or amendment of any of the terms or
provisions of this Indenture or the Notes unless such consideration is offered
to be paid and is paid to all Holders of the Notes that consent, waive or agree
to amend in the time frame set forth in the solicitation documents relating to
such consent, waiver or agreement.

 

Section 4.18                                Additional Note Guarantees.

 

If the Company or any of its Restricted Subsidiaries
acquires or creates another Domestic Subsidiary after the date of this
Indenture, then that newly acquired or created Domestic Subsidiary will become
a Guarantor and execute a supplemental indenture and

 

69

 

deliver an Opinion of
Counsel (subject to customary assumptions and exceptions) satisfactory to the
Trustee within 10 Business Days of the date on which it was acquired or
created; provided that any Domestic Subsidiary
that constitutes an Immaterial Subsidiary need not become a Guarantor until
such time as it ceases to be an Immaterial Subsidiary.  The form of such Note Guarantee is attached
as Exhibit E hereto.

 

Section 4.19                                Designation of Restricted and
Unrestricted Subsidiaries.

 

The Board of Directors of the Company may designate
any Restricted Subsidiary to be an Unrestricted Subsidiary if that designation
would not cause a Default.  If a
Restricted Subsidiary is designated as an Unrestricted Subsidiary the aggregate
Fair Market Value of all outstanding Investments owned by the Company and its
Restricted Subsidiaries in the Subsidiary designated as Unrestricted will be
deemed to be an Investment made as of the time of the designation and will
reduce the amount available for Restricted Payments under Section 4.07
hereof or under one or more clauses of the definition of Permitted Investments,
as determined by the Company.  That
designation will only be permitted if the Investment would be permitted at that
time and if the Restricted Subsidiary otherwise meets the definition of an
Unrestricted Subsidiary.  The Board of
Directors of the Company may redesignate any Unrestricted Subsidiary to be a
Restricted Subsidiary if that redesignation would not cause a Default.

 

Any designation of a Subsidiary of the Company as an
Unrestricted Subsidiary will be evidenced to the Trustee by filing with the
Trustee a certified copy of a resolution of the Board of Directors giving
effect to such designation and an Officer’s Certificate certifying that such
designation complied with the preceding conditions and was permitted by
Section 4.07 hereof.  If, at any
time, any Unrestricted Subsidiary would fail to meet the preceding requirements
as an Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted
Subsidiary for purposes of this Indenture and any Indebtedness of such
Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the
Company as of such date and, if such Indebtedness is not permitted to be
incurred as of such date under Section 4.09 hereof, the Company will be in
default of such covenant.  The Board of
Directors of the Company may at any time designate any Unrestricted Subsidiary
to be a Restricted Subsidiary; provided that
such designation will be deemed to be an incurrence of Indebtedness by a
Restricted Subsidiary of the Company of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation will only be permitted if
(1) such Indebtedness is permitted under Section 4.09 hereof,
calculated on a pro forma basis as if such designation had occurred at the
beginning of the four-quarter reference period; and (2) no Default or
Event of Default would be in existence following such designation.

 

Section
4.20                                No Layering of Debt.

 

The Company will not incur, create, issue, assume,
guarantee or otherwise become liable for any Indebtedness that is contractually
subordinate or junior in right of

 

70

 

payment to any Senior
Indebtedness of the Company and senior in right of payment to the Notes.  No Guarantor will incur, create, issue,
assume, guarantee or otherwise become liable for any Indebtedness that is
contractually subordinate or junior in right of payment to the Senior Indebtedness
of such Guarantor and senior in right of payment to such Guarantor’s Note
Guarantee.  No such Indebtedness will be
considered to be senior by virtue of being secured on a first or junior
priority basis.

 

Section 4.21                                Subsequent
Issuances.

 

The Company may issue Additional Notes provided that
(1) no Event of Default has occurred and is continuing at the time of or
would be caused by such issuance, (2) the Incurrence of Indebtedness
evidenced by such Additional Notes is permitted pursuant to Section 4.09,
and (3) if such Additional Notes are issued in connection with the
issuance of the Company’s EISs or Class A Common Stock, the ratio of the aggregate
principal amount of such Additional Notes to the number of such additional
shares of the Class A Common Stock shall be equal to the equivalent ratio
with respect to the Notes and shares of Class A Common Stock represented by
EISs outstanding immediately prior to the issuance of such Additional Notes.

 

The Company may issue Additional Notes only if it
delivers to the Trustee on the date of such issuance a certificate of the
Company’s principal financial officer stating that on such date, after giving
pro forma effect to the issuance of such Additional Notes and the related
Guarantees, the Company and the Guarantors are solvent.  Furthermore,
the Company may issue Additional Notes only if it has received an opinion of
independent tax counsel to the effect that the Additional Notes should be
treated as debt for U.S. federal income tax purposes.

 

The Company agrees, and by purchasing the Notes each
Holder and each owner of a beneficial interest in a Global Note shall be deemed
to have agreed, that, upon the issuance by the Company of any Additional Notes,
if the Company determines that such Additional Notes should be assigned a
different CUSIP number than the CUSIP number assigned to the Initial Notes,
then immediately following such issuance (and immediately following any
issuance of Additional Notes thereafter) a portion of each such Holder’s or
beneficial owner’s Initial Notes and/or Additional Notes, as applicable, or
beneficial ownership interest therein, will automatically, without any action
by such Holder or beneficial owner, be exchanged (each, an “Automatic Exchange”) for a portion of
each other Holder’s Initial Notes and/or Additional Notes or each other
beneficial owner’s beneficial interest in the Initial Notes and/or Additional
Notes, as applicable, such that each Holder and owner of a beneficial interest
in a Global Note will hold Notes or beneficial interests in the Global Notes of
each issuance in the same proportion as each other Holder and owner of
beneficial interests in the Global Notes. 
The aggregate stated principal amount of Notes owned by each Holder and
owner of a beneficial interest in a Global Note will not change as a result of
the Automatic Exchange.  Immediately
following the Automatic Exchange, the Company and the Trustee will instruct the

 

71

 

Depository to facilitate
the combination of the Notes issued prior to the date of issuance of such
Additional Notes and such Additional Notes into inseparable units (“Note Units”) in accordance with the
procedures of the Depository.  The Note
Units will be assigned a new CUSIP number, and the transfers and exchanges of
beneficial interests in the Note Units will be effected through the Depository.

 

At least ten (10) business days prior to the closing
of the issuance of Additional Notes that will result in an Automatic Exchange,
the Company shall notify the Trustee in writing of its intention to consummate
such subsequent issuance and shall instruct the Trustee and Depository to take
any action necessary to effect the Automatic Exchange.  Such notice may be revoked at any time prior
to the date fixed for such Automatic Exchange.

 

The Company agrees, and by acceptance of beneficial
ownership in the Notes each beneficial owner of the Notes shall be deemed to
have agreed, that (1) the Company will report any “original issue discount” (as determined for U.S. federal income
tax purposes) associated with the Initial Notes and Additional Notes among all
beneficial owners in proportion to their ownership of the aggregate principal
amount of Notes and (2) each beneficial owner of the Notes shall report
such original issue discount in this manner and shall not take an inconsistent
position for any applicable tax purpose.

 

With respect to any Additional Notes with a different
CUSIP number exchanged in any Automatic Exchange, Holders and owners of
beneficial interests in the Global Notes may obtain the amount of original
issue discount in respect of such Additional Notes, the date of issuance, the
issue price and the yield to maturity by submitting a written request to the
Trustee.

 

Section
4.22                                Combination of Notes and Class A Common Stock.

 

As long as Notes are outstanding, any Holder of Notes
that do not constitute part of an EIS and of shares of Class A Common Stock
that do not constitute part of an EIS may, at any time, combine such Notes and
shares of Class A Common Stock (in the same proportion as the Notes and shares
of Class A Common Stock represented by the EISs outstanding at the time of such
combination) to form EISs, unless all EISs have been previously automatically
separated as a result of redemption or maturity of the Notes or otherwise [or
there are otherwise no longer any EISs outstanding.]

 

ARTICLE 5

SUCCESSORS

 

Section 5.01                                Merger, Consolidation, or Sale of
Assets.

 

The Company shall not, directly or indirectly:
(1) consolidate or merge with or into another Person (whether or not the
Company is the surviving entity); or (2) sell,

 

72

 

assign, transfer, convey
or otherwise dispose of all or substantially all of the properties or assets
(such amounts to be computed on a consolidated basis) of the Company and its
Restricted Subsidiaries taken as a whole, in one or more related transactions,
to another Person, unless:

 

(1)                                  either: (a) the Company is the
surviving corporation; or (b) the Person formed by or surviving any such
consolidation or merger (if other than the Company) or to which such sale,
assignment, transfer, conveyance or other disposition has been made is either
(i) a corporation organized or existing under the laws of the United
States, any state of the United States or the District of Columbia or
(ii) a partnership or limited liability company organized or existing
under the laws of the United States, any state of the United States or the
District of Columbia that has at least one Restricted Subsidiary that is a
corporation organized or existing under the laws of the United States, any
state of the United States or the District of Columbia, which corporation
becomes the co-issuer of the Notes pursuant to a supplemental indenture
reasonably satisfactory to the Trustee;

 

(2)                                  the Person formed by or surviving
any such consolidation or merger (if other than the Company) or the Person to
which such sale, assignment, transfer, conveyance or other disposition has been
made assumes all the obligations of the Company under the Notes and this
Indenture pursuant to agreements reasonably satisfactory to the Trustee;

 

(3)                                  immediately after such transaction,
no Default or Event of Default exists; and

 

(4)                                  the Company or the Person formed by
or surviving any such consolidation or merger (if other than the Company), or
to which such sale, assignment, transfer, conveyance or other disposition has
been made would, on the date of such transaction after giving pro forma effect
thereto and any related financing transactions as if the same had occurred at
the beginning of the applicable four-quarter period, either:

 

(A)                              be permitted to incur at least
$1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio
test set forth in Section 4.09(a) hereof.

 

(B)                                have a Fixed Charge Coverage Ratio
that is equal to or greater than the Fixed Charge Coverage Ratio of the Company
immediately prior to such consolidation, merger, sale, assignment, transfer,
conveyance or other disposition.

 

73

 

In addition, the Company shall not, directly or
indirectly, lease all or substantially all of the properties and assets of it
and its Restricted Subsidiaries taken as a whole, in one or more related
transactions, to any other Person.

 

This Section 5.01 will not apply to:

 

(1)                                  a merger of the Company with an
Affiliate solely for the purpose of reincorporating the Company in another
jurisdiction; or

 

(2)                                  any consolidation or merger, or any
sale, assignment, transfer, conveyance, lease or other disposition of assets
between or among the Company and its Restricted Subsidiaries.

 

Section 5.02                                Successor Corporation
Substituted.

 

Upon any consolidation or merger, or any sale,
assignment, transfer, lease, conveyance or other disposition of all or substantially
all of the properties or assets of the Company in a transaction that is subject
to, and that complies with the provisions of, Section 5.01 hereof, the
successor Person formed by such consolidation or into or with which the Company
is merged or to which such sale, assignment, transfer, lease, conveyance or
other disposition is made shall succeed to, and be substituted for (so that
from and after the date of such consolidation, merger, sale, assignment,
transfer, lease, conveyance or other disposition, the provisions of this
Indenture referring to the “Company” shall refer instead to the successor
Person and not to the Company), and may exercise every right and power of the
Company under this Indenture with the same effect as if such successor Person
had been named as the Company herein; provided, however,
that the predecessor Company shall not be relieved from the obligation to pay
the principal of and interest on the Notes except in the case of a sale of all
of the Company’s assets in a transaction that is subject to, and that complies
with the provisions of, Section 5.01 hereof.

 

ARTICLE
6

DEFAULTS AND REMEDIES

 

Section 6.01                                Events of Default.

 

Each of the following is an “Event of Default”:

 

(1)                                  default for 30 consecutive days in
the payment when due of interest on the Notes, whether or not prohibited by
Article 10 hereof;

 

(2)                                  default in the payment when due (at
maturity, upon redemption or otherwise) of the principal of, or premium, if
any, on, the Notes, whether or not prohibited by Article 10 hereof;

 

74

 

(3)                                  failure by the Company or any of
its Restricted Subsidiaries to comply with the provisions of Section 5.01
hereof;

 

(4)                                  failure by the Company or any of
its Restricted Subsidiaries for 30 days to comply with the provisions of
Sections 4.10 and 4.15 hereof;

 

(5)                                  failure by the Company or any of
its Restricted Subsidiaries for 60 days after written notice to the Company by
the Trustee or the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding voting as a single class to comply with any of the other
agreements in this Indenture;

 

(6)                                  default under any mortgage,
indenture or instrument under which there may be issued or by which there may
be secured or evidenced any Indebtedness for money borrowed by the Company or
any of its Restricted Subsidiaries (or the payment of which is guaranteed by
the Company or any of its Restricted Subsidiaries), whether such Indebtedness
or Guarantee now exists, or is created after the date of this Indenture, if
that default:

 

(A)                              is caused by a failure to pay
principal of, or interest or premium, if any, on, such Indebtedness prior to
the expiration of the grace period provided in such Indebtedness on the date of
such default (a “Payment Default”);
or

 

(B)                                results in the acceleration of such
Indebtedness prior to its express maturity,

 

and, in each case, the principal amount of any such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated, aggregates $10.0 million or more;

 

(7)                                  failure by the Company or any of
its Restricted Subsidiaries to pay final judgments entered by a court or courts
of competent jurisdiction aggregating in excess of $10.0 million, which
judgments are not paid, discharged or stayed for a period of 60 days after
their entry;

 

(8)                                  the Company or any of its
Restricted Subsidiaries that is a Significant Subsidiary or any group of
Restricted Subsidiaries of the Company that, taken together, would constitute a
Significant Subsidiary pursuant to or within the meaning of Bankruptcy Law:

 

(A)                              commences a voluntary case,

 

75

 

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

 

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

 

(D)                               makes a general assignment for the
benefit of its creditors, or

 

(E)                                 generally is not paying its debts
as they become due;

 

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

 

(A)                              is for relief against the Company
or any of its Restricted Subsidiaries that is a Significant Subsidiary or any
group of Restricted Subsidiaries of the Company that, taken together, would
constitute a Significant Subsidiary in an involuntary case;

 

(B)                                appoints a custodian of the Company
or any of its Restricted Subsidiaries that is a Significant Subsidiary or any
group of Restricted Subsidiaries of the Company that, taken together, would
constitute a Significant Subsidiary or for all or substantially all of the
property of the Company or any of its Restricted Subsidiaries that is a
Significant Subsidiary or any group of Restricted Subsidiaries of the Company
that, taken together, would constitute a Significant Subsidiary; or

 

(C)                                orders the liquidation of the
Company or any of its Restricted Subsidiaries that is a Significant Subsidiary
or any group of Restricted Subsidiaries of the Company that, taken together,
would constitute a Significant Subsidiary;

 

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

 

(10)                            a
payment of dividends by the Company on its common stock (A) during the
continuance of an Event of Default, (B) pursuant to the second
clause (1) of paragraph (a) of Section 4.07 of this Indenture when
the then-available financial statements presented to the Board of Directors of
the Company show a Fixed Charge Coverage Ratio of less than 1.6 to 1.0, or
(C) pursuant to the second clause (2) of paragraph (a) of
Section 4.07 of this Indenture when the then-available financial
statements presented to the Board of Directors of the Company show that the
amount of dividends paid exceeds the amount permitted to be paid under such
clause; or

 

76

 

(11)                            except as permitted by this
Indenture, any Note Guarantee is held in any judicial proceeding to be
unenforceable or invalid or ceases for any reason to be in full force and
effect, or any Guarantor, or any Person acting on behalf of any Guarantor,
denies or disaffirms its obligations under its Note Guarantee.

 

Section 6.02                                Acceleration.

 

In the case of an Event of Default specified in
clause (8) or (9) of Section 6.01 hereof, with respect to the
Company, any Restricted Subsidiary of the Company that is a Significant
Subsidiary or any group of Restricted Subsidiaries of the Company that, taken
together, would constitute a Significant Subsidiary, all outstanding Notes will
become due and payable immediately without further action or notice.  If any other Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in aggregate principal
amount of the then outstanding Notes may declare all the Notes to be due and
payable immediately.

 

Upon any such declaration, the Notes shall become due
and payable immediately.

 

The Holders of a majority in aggregate principal
amount of the then outstanding Notes by written notice to the Trustee may, on
behalf of all of the Holders, rescind an acceleration and its consequences, if
the rescission would not conflict with any judgment or decree and if all
existing Events of Default (except nonpayment of principal, interest or
premium, if any, that has become due solely because of the acceleration) have
been cured or waived.

 

If an Event of Default occurs on or after October 30,
2009 by reason of any willful action (or inaction) taken (or not taken) by or
on behalf of the Company with the intention of avoiding payment of the premium
that the Company would have had to pay if the Company then had elected to
redeem the Notes pursuant to Section 3.07 hereof, then, upon acceleration
of the Notes, an equivalent premium shall also become and be immediately due
and payable, to the extent permitted by law, anything in this Indenture or in
the Notes to the contrary notwithstanding. If an Event of Default occurs prior
to October 30, 2009 by reason of any willful action (or inaction) taken
(or not taken) by or on behalf of the Company with the intention of avoiding
the prohibition on redemption of the Notes prior to such date, then, upon
acceleration of the Notes, an additional premium shall also become and be
immediately due and payable, to the extent permitted by law, in an amount, for
each of the years beginning on October 30 of the years set forth below, as set
forth below (expressed as a percentage of the principal amount of the Notes on
the date of payment that would otherwise be due but for the provisions of this
sentence):

 

77

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
  2009

  	
   

  	
  106.000

  	
  %

  
	
  2010

  	
   

  	
  104.000

  	
  %

  
	
  2011

  	
   

  	
  102.000

  	
  %

  
	
  2012 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

Section 6.03                                Other Remedies.

 

If an Event of Default occurs and is continuing, the
Trustee may pursue any available remedy to collect the payment of principal,
premium, if any, and interest on the Notes or to enforce the performance of any
provision of the Notes or this Indenture.

 

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

 

Section 6.04                                Waiver of Past Defaults.

 

Holders of not less than a majority in aggregate
principal amount of the then outstanding Notes by notice to the Trustee may on
behalf of the Holders of all of the Notes waive an existing Default or Event of
Default and its consequences hereunder, except a continuing Default or Event of
Default in the payment of the principal of, premium, if any, or interest on,
the Notes (including in connection with an offer to purchase) or an Event of
Default under clause (10) of Section 6.01; provided,
however, that the Holders of a majority in aggregate principal
amount of the then outstanding Notes may rescind an acceleration and its consequences,
including any related payment default that resulted from such
acceleration.  Upon any such waiver, such
Default shall cease to exist, and any Event of Default arising therefrom shall
be deemed to have been cured for every purpose of this Indenture; but no such
waiver shall extend to any subsequent or other Default or impair any right
consequent thereon.

 

Section 6.05                                Control by Majority.

 

Holders of a majority in aggregate principal amount of
the then outstanding Notes may direct the time, method and place of conducting
any proceeding for exercising any remedy available to the Trustee or exercising
any trust or power conferred on it. 
However, the Trustee may refuse to follow any direction that conflicts
with law or this Indenture that the Trustee determines in good faith may be
prejudicial to the rights of other Holders of Notes or that may involve the
Trustee in personal liability.

 

78

 

Section 6.06                                Limitation on Suits.

 

A Holder may pursue a remedy with respect to this
Indenture or the Notes, except for any remedy with respect to an Event of
Default under this Indenture, only if:

 

(1)                                  such Holder gives to the Trustee
written notice that such Event of Default is continuing;

 

(2)                                  Holders of at least 25% (or
at least 10%, in respect of a remedy (other than acceleration) for an Event of
Default under clause (10) of Section 6.01 hereof) in aggregate principal amount of the then outstanding Notes make a
written request to the Trustee to pursue the remedy for such Event of Default;

 

(3)                                  such Holder or Holders offer and,
if requested, provide to the Trustee security or indemnity reasonably
satisfactory to the Trustee against any loss, liability or expense;

 

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

 

(5)                                  except with respect to a remedy
(other than acceleration) for an Event of Default under clause (10) of
Section 6.01 hereof), during such 60-day period, Holders of a majority in
aggregate principal amount of the then outstanding Notes do not give the
Trustee a direction inconsistent with such request.

 

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

 

Section 6.07                                Rights of Holders of Notes to
Receive Payment.

 

Notwithstanding any other provision of this Indenture,
the right of any Holder of a Note to receive payment of principal, premium, if
any, and interest on the Note, on or after the respective due dates expressed
in the Note (including in connection with an offer to purchase), or to bring
suit for the enforcement of any such payment on or after such respective dates,
shall not be impaired or affected without the consent of such Holder.

 

Section 6.08                                Collection Suit by Trustee.

 

If an Event of Default specified in
Section 6.01(1) or (2) hereof occurs and is continuing, the Trustee is
authorized to recover judgment in its own name and as trustee of an express
trust against the Company for the whole amount of principal of, premium, if
any, and interest remaining unpaid on, the Notes and interest on overdue
principal and, to the extent lawful, interest and such further amount as shall
be sufficient to cover the

 

79

 

costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel.

 

Section 6.09                                Trustee May File Proofs of Claim.

 

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

 

Section 6.10                                Priorities.

 

If the Trustee collects any money pursuant to this
Article 6, it shall pay out the money in the following order:

 

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

 

Second:  to holders of Senior Indebtedness to the
extent required by Article 10 and Section 11.02 of this Indenture;

 

80

 

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

 

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

 

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

 

Section 6.11                                Undertaking for Costs.

 

In any suit for the enforcement of any right or remedy
under this Indenture or in any suit against the Trustee for any action taken or
omitted by it as a Trustee, a court in its discretion may require the filing by
any party litigant in the suit of an undertaking to pay the costs of the suit,
and the court in its discretion may assess reasonable costs, including
reasonable attorneys’ fees 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 6.11 does not apply to a suit by the Trustee, a suit by a Holder
of a Note pursuant to Section 6.07 hereof, or a suit by Holders of more
than 10% in aggregate principal amount of the then outstanding Notes.

 

ARTICLE 7

TRUSTEE

 

Section 7.01                                Duties of Trustee.

 

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

 

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

 

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

 

(2)                                  in the absence of bad faith on its
part, the Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of this
Indenture.  However, the Trustee will

 

81

 

examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture.

 

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

 

(1)                                  this paragraph does not limit the
effect of paragraph (b) of this Section 7.01;

 

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

 

(3)                                  the Trustee will not be liable with
respect to any action it takes or omits to take in good faith in accordance
with a direction received by it pursuant to Section 6.05 hereof.

 

(d)                                 Whether or not therein expressly so
provided, every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), and (c) of this
Section 7.01.

 

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

 

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

 

Section 7.02                                Rights of Trustee.

 

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

 

(b)                                 Before the Trustee acts or refrains
from acting, it may require an Officers’ Certificate or an Opinion of Counsel
or both.  The Trustee will not be liable
for any action it takes or omits to take in good faith in reliance on such
Officers’ Certificate or Opinion of Counsel. 
The Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel will be full and complete authorization and

 

82

 

protection from
liability in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon.

 

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

 

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

 

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

 

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

 

(g)                                 in no event shall the Trustee be
responsible or liable for special, indirect, or consequential loss or damage of
any kind whatsoever (including, but not limited to, loss of profit)
irrespective of whether the Trustee has been advised of the likelihood of such
loss or damage and regardless of the form of action.

 

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

 

(i)                                     the
rights, privileges, protections, immunities and benefits given to the Trustee,
including, without limitation, its right to be indemnified, are extended to,
and shall be enforceable by, the Trustee in each of its capacities hereunder,
and each agent, custodian and other Person employed to act hereunder.

 

Section 7.03                                Individual Rights of Trustee.

 

The Trustee in its individual or any other capacity
may become the owner or pledgee of Notes and may otherwise deal with the
Company or any Affiliate of the Company with the same rights it would have if
it were not Trustee.  However, in the
event that the Trustee acquires any conflicting interest it must eliminate such
conflict within 90 days, apply to the SEC for permission to continue as trustee
(if this Indenture

 

83

 

has been qualified under
the TIA) or resign.  Any Agent may do the
same with like rights and duties.  The
Trustee is also subject to Sections 7.10 and 7.11 hereof.

 

Section 7.04                                Trustee’s Disclaimer.

 

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

 

Section 7.05                                Notice of Defaults.

 

If a Default or Event of Default occurs and is
continuing and if it is known to the Trustee, the Trustee will mail to Holders
of Notes a notice of the Default or Event of Default within 90 days after it
occurs.  Except in the case of a Default
or Event of Default in payment of principal of, premium, if any, or interest
on, any Note or an Event of Default under paragraph (10) of Section 6.01
hereof, the Trustee may withhold the notice if and so long as a committee of
its Responsible Officers in good faith determines that withholding the notice
is in the interests of the Holders of the Notes.

 

Section 7.06                                Reports by Trustee to Holders of
the Notes.

 

(a)                                  Within 60 days after each May 15
beginning with the May 15 following the date of this Indenture, and for so long
as Notes remain outstanding, the Trustee will mail to the Holders of the Notes
a brief report dated as of such reporting date that complies with TIA
§ 313(a) (but if no event described in TIA § 313(a) has occurred
within the twelve months preceding the reporting date, no report need be
transmitted).  The Trustee also will
comply with TIA § 313(b)(2).  The
Trustee will also transmit by mail all reports as required by TIA § 313(c).

 

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

 

Section 7.07                                Compensation and Indemnity.

 

(a)                                  The Company will pay to the Trustee
from time to time reasonable compensation for its acceptance of this Indenture
and services hereunder as the parties

 

84

 

shall agree in
writing from time to time.  The Trustee’s
compensation will not be limited by any law on compensation of a trustee of an
express trust.  The Company will
reimburse the Trustee promptly upon request for all reasonable disbursements,
advances and expenses incurred or made by it in addition to the compensation
for its services.  Such expenses will
include the reasonable compensation, disbursements and expenses of the
Trustee’s agents and counsel.

 

(b)                                 The Company and the Guarantors will
indemnify the Trustee against any and all losses, liabilities, claims, damages
or expenses incurred by it arising out of or in connection with the acceptance
or administration of its duties under this Indenture, including the costs and
expenses of enforcing this Indenture against the Company and the Guarantors
(including this Section 7.07) and defending itself against any claim
(whether asserted by the Company, the Guarantors, any Holder or any other
Person) or liability in connection with the exercise or performance of any of
its powers or duties hereunder, except to the extent any such loss, liability
or expense may be attributable to its negligence or bad faith.  The Trustee will notify the Company promptly
of any claim for which it may seek indemnity. 
Failure by the Trustee to so notify the Company will not relieve the
Company or any of the Guarantors of their obligations hereunder.  The Company or such Guarantor will defend the
claim and the Trustee will cooperate in the defense.  The Trustee may have separate counsel and the
Company will pay the reasonable fees and expenses of such counsel.  Neither the Company nor any Guarantor need
pay for any settlement made without its consent, which consent will not be unreasonably
withheld.

 

(c)                                  The obligations of the Company and
the Guarantors under this Section 7.07 will survive the satisfaction and
discharge of this Indenture.

 

(d)                                 To secure the Company’s and the
Guarantors’ payment obligations in this Section 7.07, the Trustee will
have a Lien prior to the Notes on all money or property held or collected by
the Trustee, except that held in trust to pay principal and interest on
particular Notes.  Such Lien will survive
the satisfaction and discharge of this Indenture.

 

(e)                                  When the Trustee incurs expenses or
renders services after an Event of Default specified in Section 6.01(8) or
(9) hereof occurs, the expenses and the compensation for the services
(including the fees and expenses of its agents and counsel) are intended to
constitute expenses of administration under any Bankruptcy Law.

 

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

 

85

 

Section 7.08                                Replacement of Trustee.

 

(a)                                  A resignation or removal of the
Trustee and appointment of a successor Trustee will become effective only upon
the successor Trustee’s acceptance of appointment as provided in this
Section 7.08.

 

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

 

(1)                                  the Trustee fails to comply with
Section 7.10 hereof;

 

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

 

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

 

(4)                                  the Trustee becomes incapable of
acting.

 

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

 

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

 

(e)                                  If the Trustee, after written
request by any Holder who has been a Holder for at least six months, fails to
comply with Section 7.10 hereof, such Holder may petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.

 

(f)                                    A successor Trustee will deliver a
written acceptance of its appointment to the retiring Trustee and to the
Company.  Thereupon, the resignation or
removal of the retiring Trustee will become effective, and the successor
Trustee will have all the rights, powers and duties of the Trustee under this
Indenture.  The successor Trustee will
mail a notice of its succession to Holders. 
The retiring Trustee will promptly transfer all

 

86

 

property held by
it as Trustee to the successor Trustee; provided all
sums owing to the Trustee hereunder have been paid and subject to the Lien
provided for in Section 7.07 hereof. 
Notwithstanding replacement of the Trustee pursuant to this
Section 7.08, the Company’s obligations under Section 7.07 hereof
will continue for the benefit of the retiring Trustee.

 

Section 7.09                                Successor Trustee by Merger, etc.

 

If the Trustee consolidates, merges or converts into,
or transfers all or substantially all of its corporate trust business to,
another corporation, the successor corporation without any further act will be
the successor Trustee.

 

Section 7.10                                Eligibility; Disqualification.

 

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

 

This Indenture will always have a Trustee who
satisfies the requirements of TIA § 310(a)(1), (2) and (5).  The Trustee is subject to TIA § 310(b).

 

Section 7.11                                Preferential Collection of Claims
Against Company.

 

The Trustee is subject to TIA § 311(a), excluding
any creditor relationship listed in TIA § 311(b).  A Trustee who has resigned or been removed
shall be subject to TIA § 311(a) to the extent indicated therein.

 

ARTICLE
8

LEGAL DEFEASANCE AND COVENANT DEFEASANCE

 

Section 8.01                                Option to Effect Legal Defeasance
or Covenant Defeasance.

 

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

 

Section 8.02                                Legal Defeasance and Discharge.

 

Upon the Company’s exercise under Section 8.01
hereof of the option applicable to this Section 8.02, the Company and each
of the Guarantors will, subject to the satisfaction of the conditions set forth
in Section 8.04 hereof, be deemed to have been

 

87

 

discharged from their
obligations with respect to all outstanding Notes (including the Note
Guarantees) on the date the conditions set forth below are satisfied
(hereinafter, “Legal Defeasance”).  For this purpose, Legal Defeasance means that
the Company and the Guarantors will be deemed to have paid and discharged the
entire Indebtedness represented by the outstanding Notes (including the Note
Guarantees), which will thereafter be deemed to be “outstanding”
only for the purposes of Section 8.05 hereof and the other Sections of
this Indenture referred to in clauses (1) and (2) below, and to have
satisfied all their other obligations under such Notes, the Note Guarantees and
this Indenture (and the Trustee, on demand of and at the expense of the
Company, shall execute proper instruments acknowledging the same), except for
the following provisions which will survive until otherwise terminated or
discharged hereunder:

 

(1)                                  the rights of Holders of
outstanding Notes to receive payments in respect of the principal of, or
interest or premium, if any, on such Notes when such payments are due from the
trust referred to in Section 8.04 hereof;

 

(2)                                  the Company’s obligations with
respect to such Notes under Article 2 and Section 4.02 hereof;

 

(3)                                  the rights, powers, trusts, duties
and immunities of the Trustee hereunder and the Company’s and the Guarantors’
obligations in connection therewith; and

 

(4)                                  this Article 8.

 

Subject to compliance with this Article 8, the Company
may exercise its option under this Section 8.02 notwithstanding the prior
exercise of its option under Section 8.03 hereof.

 

Section 8.03                                Covenant Defeasance.

 

Upon the Company’s exercise under Section 8.01
hereof of the option applicable to this Section 8.03, the Company and each
of the Guarantors will, subject to the satisfaction of the conditions set forth
in Section 8.04 hereof, be released from each of their obligations under
the covenants contained in Sections 4.07, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13,
4.15, 4.16, 4.17, 4.18, 4.19 and 4.20 hereof and clause (4) of
Section 5.01 hereof with respect to the outstanding Notes on and after the
date the conditions set forth in Section 8.04 hereof are satisfied
(hereinafter, “Covenant Defeasance”),
and the Notes will thereafter be deemed not “outstanding” for the purposes of any direction,
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but will continue to be deemed “outstanding” for all other purposes hereunder (it being understood that
such Notes will not be deemed outstanding for accounting purposes).  For this purpose, Covenant Defeasance means
that, with respect to the outstanding Notes and Note Guarantees, the Company
and the

 

88

 

Guarantors may omit to
comply with and will have no liability in respect of any term, condition or
limitation set forth in any such covenant, whether directly or indirectly, by
reason of any reference elsewhere herein to any such covenant or by reason of
any reference in any such covenant to any other provision herein or in any
other document and such omission to comply will not constitute a Default or an
Event of Default under Section 6.01 hereof, but, except as specified
above, the remainder of this Indenture and such Notes and Note Guarantees will
be unaffected thereby.  In addition, upon
the Company’s exercise under Section 8.01 hereof of the option applicable
to this Section 8.03, subject to the satisfaction of the conditions set
forth in Section 8.04 hereof, Sections 6.01(3) through 6.01(6) hereof will
not constitute Events of Default.

 

Section 8.04                                Conditions to Legal or Covenant
Defeasance.

 

In order to exercise either Legal Defeasance or
Covenant Defeasance under either Section 8.02 or 8.03 hereof:

 

(1)                                  the Company must irrevocably
deposit with the Trustee, in trust, for the benefit of the Holders, cash in
U.S. dollars, non-callable Government Securities, or a combination thereof, in
such amounts as will be sufficient, in the opinion of a nationally recognized
investment bank, appraisal firm or independent registered public accounting
firm, to pay the principal of, premium and, if any, interest on, the
outstanding Notes on the stated date for payment thereof or on the applicable
redemption date, as the case may be, and the Company must specify whether the
Notes are being defeased to such stated date for payment or to a particular
redemption date;

 

(2)                                  in the case of an election under
Section 8.02 hereof, the Company must deliver to the Trustee an Opinion of
Counsel confirming that:

 

(A)                              the Company has received from, or
there has been published by, the Internal Revenue Service a ruling; or

 

(B)                                since the date of this Indenture,
there has been a change in the applicable federal income tax law,

 

in either case to
the effect that, and based thereon such Opinion of Counsel shall confirm that,
the Holders of the outstanding Notes will not recognize income, gain or loss
for federal income tax purposes as a result of such Legal Defeasance and will
be subject to federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such Legal Defeasance had not
occurred;

 

(3)                                  in the case of an election under
Section 8.03 hereof, the Company must deliver to the Trustee an Opinion of
Counsel confirming that the Holders of

 

89

 

the outstanding Notes will not recognize income, gain or loss for
federal income tax purposes as a result of such Covenant Defeasance and will be
subject to federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such Covenant Defeasance had not
occurred;

 

(4)                                  no Default or Event of Default
shall have occurred and be continuing on the date of such deposit (other than a
Default or Event of Default resulting from the borrowing of funds to be applied
to such deposit) and the deposit will not result in a breach or violation of, or
constitute a default under, any other material instrument to which the Company
or any Guarantor is a party or by which the Company or any Guarantor is bound
and is not prohibited by Article 10 or Section 11.02 of this Indenture;

 

(5)                                  such Legal Defeasance or Covenant
Defeasance will not result in a breach or violation of, or constitute a default
under, any material agreement or instrument (other than this Indenture) to
which the Company or any of its Subsidiaries is a party or by which the Company
or any of its Subsidiaries is bound;

 

(6)                                  the Company must deliver to the
Trustee an Officers’ Certificate stating that the deposit was not made by the
Company with the intent of preferring the Holders of Notes over the other
creditors of the Company with the intent of defeating, hindering, delaying or
defrauding any creditors of the Company or others; and

 

(7)                                  the Company must deliver to the
Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that
all conditions precedent relating to the Legal Defeasance or the Covenant
Defeasance have been complied with.

 

Section 8.05                                Deposited Money and Government
Securities to be Held in Trust; Other Miscellaneous Provisions.

 

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

 

The Company will pay and indemnify the Trustee against
any tax, fee or other charge imposed on or assessed against the cash or
non-callable Government Securities

 

90

 

deposited pursuant to
Section 8.04 hereof or the principal and interest received in respect
thereof other than any such tax, fee or other charge which by law is for the
account of the Holders of the outstanding Notes.

 

Notwithstanding anything in this Article 8 to the
contrary, the Trustee will deliver or pay to the Company from time to time upon
the request of the Company any money or non-callable Government Securities held
by it as provided in Section 8.04 hereof which, in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee (which may be the
opinion delivered under Section 8.04(1) hereof), are in excess of the
amount thereof that would then be required to be deposited to effect an
equivalent Legal Defeasance or Covenant Defeasance.

 

Section 8.06                                Repayment to Company.

 

Any money deposited with the Trustee or any Paying
Agent, or then held by the Company, in trust for the payment of the principal
of, premium, if any, or interest on, any Note and remaining unclaimed for two
years after such principal, premium, if any, or interest has become due and
payable shall be paid to the Company on its request or (if then held by the
Company) will be discharged from such trust; and the Holder of such Note will
thereafter be permitted to look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, will thereupon cease; provided, however, that the Trustee or such Paying Agent,
before being required to make any such repayment, may at the expense of the
Company cause to be published once, in the New York Times and The Wall Street
Journal (national edition), notice that such money remains unclaimed and that,
after a date specified therein, which will not be less than 30 days from the
date of such notification or publication, any unclaimed balance of such money
then remaining will be repaid to the Company.

 

Section 8.07                                Reinstatement.

 

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

 

91

 

ARTICLE
9

AMENDMENT, SUPPLEMENT AND WAIVER

 

Section 9.01                                Without Consent of Holders of
Notes.

 

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

 

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

 

(2)                                  to provide for uncertificated Notes
in addition to or in place of certificated Notes;

 

(3)                                  to provide for the assumption of
the Company’s or a Guarantor’s obligations to the Holders of Notes and Note
Guarantees by a successor to the Company or such Guarantor pursuant to Article
5 hereof;

 

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

 

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

 

(6)                                  to conform the text of this
Indenture, the Note Guarantees or the Notes to any provision of the “Description of Senior Subordinated Notes” section of the Company’s Prospectus
dated October 7, 2004,
relating to the initial offering of the Notes, to the extent that such
provision in that “Description of
Senior Subordinated Notes” was
intended to be a verbatim recitation of a provision of this Indenture, the Note
Guarantees or the Notes;

 

(7)                                  to provide for or confirm the
issuance of Additional Notes in accordance with the limitations set forth in
this Indenture;

 

(8)                                  to comply with the provisions of
the Depository or the Trustee with respect to the provisions of this Indenture
and the Notes relating to transfers and exchanges of Notes or beneficial
interests in the Notes; or

 

(9)                                  to evidence the release of any
Guarantor permitted to be released under the terms of this Indenture or to
allow any Guarantor to execute a supplemental indenture and/or a Note Guarantee
with respect to the Notes.

 

Notwithstanding the foregoing, no amendment may be
made to Article 10 or Section 11.02 of this Indenture that adversely
affects the rights of any holder of Senior

 

92

 

Indebtedness of the
Company or any Guarantor then outstanding unless the holders of such Senior
Indebtedness (or their Representative) consent to such change.

 

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

 

Section 9.02                                With Consent of Holders of Notes.

 

Except as provided below in this Section 9.02,
the Company and the Trustee may amend. modify or supplement this Indenture
(including, without limitation, Section 3.09, 4.10 and 4.15 hereof) and
the Notes and the Note Guarantees with the consent of the Holders of at least a
majority in aggregate principal amount of the then outstanding Notes
(including, without limitation, Additional Notes, if any) voting as a single
class (including, without limitation, consents obtained in connection with a
tender offer or exchange offer for, or purchase of, the Notes), and, subject to
Sections 6.04 and 6.07 hereof, any existing Default or Event of Default (other
than a Default or Event of Default in the payment of the principal of, premium,
if any, or interest on, the Notes, except a payment default resulting from an
acceleration that has been rescinded) or compliance with any provision of this
Indenture or the Notes or the Note Guarantees may be waived with the consent of
the Holders of a majority in aggregate principal amount of the then outstanding
Notes (including, without limitation, Additional Notes, if any) voting as a
single class (including, without limitation, consents obtained in connection
with a tender offer or exchange offer for, or purchase of, the Notes).  Section 2.08
hereof shall determine which Notes are considered to be “outstanding” for purposes of this Section 9.02.

 

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

 

93

 

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

 

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

 

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

 

(2)                                  reduce the principal of or change
the fixed maturity of any Note or alter or waive any of the provisions with
respect to the redemption of the Notes (except as provided above with respect
to Sections 3.09, 4.10 and 4.15 hereof);

 

(3)                                  reduce the rate of or change the
time for payment of interest, including default interest, on any Note;

 

(4)                                  waive a Default or Event of Default
in the payment of principal of or interest or premium, if any, on, the Notes
(except a rescission of acceleration of the Notes by the Holders of at least a
majority in aggregate principal amount of the then outstanding Notes and a
waiver of the payment default that resulted from such acceleration);

 

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

 

(6)                                  make any change in the provisions
of this Indenture relating to waivers of past Defaults or the rights of Holders
of Notes to receive payments of principal of, or interest or premium, if any,
on, the Notes;

 

(7)                                  waive a redemption payment with
respect to any Note (other than a payment required by Sections 3.09, 4.10 or
4.15 hereof);

 

(8)                                  except
in connection with an offer by the Company to purchase all Notes,
(i) waive an Event of Default under clause (10) of Section 6.01
hereof or

 

94

 

(ii) amend
the covenant described in Section 4.07 in any way that would permit the
Company to take any action described in the second clauses (1) or (2) of the
first paragraph of Section 4.07(a) when the Company would not have
otherwise been permitted to take such action under the terms of such second
clauses (1) or (2) of the first paragraph of Section 4.07(a) as in effect
on the date hereof;

 

(9)                                  release any Guarantor from any of
its obligations under its Note Guarantee or this Indenture, except in
accordance with the terms of this Indenture;

 

(10)                            make any change to the
subordination or ranking provisions of this Indenture or the related
definitions that adversely affect the rights of any Holder; or

 

(11)                            make any change in the preceding
amendment and waiver provisions.

 

Notwithstanding the foregoing, no amendment may be
made to Article 10 or Section 11.02 of this Indenture that adversely
affects the rights of any holder of Senior Indebtedness of the Company or any
Guarantor then outstanding unless the holders of such Senior Indebtedness (or their
Representative) consent to such change.

 

Section 9.03                                Compliance with Trust Indenture Act.

 

Every amendment or supplement to this Indenture or the
Notes will be set forth in a amended or supplemental indenture that complies
with the TIA as then in effect.

 

Section 9.04                                Revocation and Effect of Consents.

 

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

 

Section 9.05                                Notation on or Exchange of Notes.

 

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

 

95

 

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

 

Section 9.06                                Trustee to Sign Amendments, etc.

 

The Trustee will sign any amended or supplemental
indenture authorized pursuant to this Article 9 if the amendment or supplement
does not adversely affect the rights, duties, liabilities or immunities of the
Trustee.  The Company may not sign an
amended or supplemental indenture until the Board of Directors of the Company
approves it.  In executing any amended
or supplemental indenture, the Trustee will be entitled to receive and (subject
to Section 7.01 hereof) will be fully protected in relying upon, in
addition to the documents required by Section 13.04 hereof, an Officers’
Certificate and an Opinion of Counsel stating that the execution of such
amended or supplemental indenture is authorized or permitted by this Indenture.

 

ARTICLE 10

SUBORDINATION

 

Section 10.01                          Agreement to
Subordinate.

 

The Company agrees, and each Holder by accepting a
Note agrees, that the Indebtedness evidenced by the Notes is subordinated in
right of payment, to the extent and in the manner provided in this Article 10,
to the prior payment in full of all Senior Indebtedness (whether outstanding on
the date hereof or hereafter created, incurred, assumed or guaranteed), and
that the subordination is for the benefit of the holders of Senior
Indebtedness.

 

Section 10.02                          Liquidation;
Dissolution; Bankruptcy.

 

Upon any payment or distribution of the assets of the
Company upon a total or partial liquidation or dissolution or reorganization of
or similar proceeding relating to the Company or its property, the holders of
Senior Indebtedness will be entitled to receive payment in full of the Senior
Indebtedness before the Holders of Notes are entitled to receive any payment,
and until the Senior Indebtedness is paid in full, any payment or distribution
to which Holders of Notes would be entitled, except as otherwise provided for
in the subordination provisions of this Indenture, will be made to Holders of
the Senior Indebtedness as their interests may appear (except that holders of
notes may receive and retain (i) Permitted Junior Securities, and
(ii) payments made from the trust created pursuant to Section 8.05
hereof so long as, on the date or dates the respective amounts were paid into
the trust, such payments were made with respect to the Notes without violating
the provisions of this Article 10 or any other material agreement binding
on the Company).  If a distribution is
made to Holders of Notes that due to the provisions of this Article 10 should
not have been made to them, such Holders are

 

96

 

required to hold it in
trust for the holders of Senior Indebtedness and to make payment to the holders
of Senior Indebtedness as their interest may appear.

 

Section 10.03                          Default on
Designated Senior Indebtedness.

 

The Company may not make any payment or distribution
to the Trustee or any Holder in respect of Obligations with respect to the
Notes or make any deposit pursuant to the provisions of Article 8 of this
Indenture and may not otherwise purchase, redeem or otherwise retire any Notes
(collectively, “pay the Notes”)
if (i) a default in the payment of the principal of, premium, if any, or
interest on any Designated Senior Indebtedness occurs and is continuing beyond
any applicable grace period or any other amount owing in respect of any
Designated Senior Indebtedness is not paid when due, or (ii) any other
default on Designated Senior Indebtedness occurs and the maturity of such
Designated Senior Indebtedness is accelerated in accordance with its terms unless,
in either case, (x) the default has been cured or waived and any such
acceleration has been rescinded or (y) such Designated Senior Indebtedness
has been paid in full (except that Holders may receive and retain
(a) Permitted Junior Securities and (b) payments made from the trust
in accordance with Section 8.05 hereof so long as, on the date or dates
the respective amounts were paid into the trust, such payments were made with
respect to the Notes without violating the provisions of this Article 10 or any
other material agreement binding on the Company).  However, the Company may pay the Notes without regard to the
foregoing if the Company and the Trustee receive written notice approving such
payment from the Representative of such Designated Senior Indebtedness with
respect to which either of the events in clause (i) or (ii) of the
immediately preceding sentence has occurred and is continuing.  In addition to the foregoing, during the
continuance of any default (other than a default described in clause (i)
or (ii) of the second preceding sentence) with respect to any Designated Senior
Indebtedness pursuant to which the maturity thereof may be accelerated
immediately without further notice (except such notice as may be required to
effect such acceleration) or upon the expiration of any applicable grace
periods, the Company may not pay the Notes for a period (a “Payment Blockage Period”) commencing upon
the receipt by the Trustee (with a copy to the Company) of written notice (a “Blockage Notice”) of such default from
the Representative of such Designated Senior Indebtedness specifying an
election to effect a Payment Blockage Period and ending on the earliest to
occur of the following events: 
(a) 179 days shall have elapsed since such receipt of such Blockage
Notice; (b) such Payment Blockage Period is terminated by written notice
to the Trustee (with a copy to the Company) from the Person or Persons who gave
such Blockage Notice, (c) the repayment in full of such Designated Senior
Indebtedness, or (d) the default giving rise to such Blockage Notice is no
longer continuing.

 

During any period in which payments are blocked
pursuant to the preceding paragraph, Holders of the Notes and the related Note
Guarantees will be entitled to all remedies with respect to the Notes and the
Note Guarantees, however, any amount

 

97

 

received by Holders with
respect to the Notes or the Note Guarantees, including as a result of legal
action to enforce the Notes of the Note Guarantees, will be required to be
turned over to holders of Designated Senior Indebtedness.  Notwithstanding the provisions described in
the immediately preceding sentence (but subject to the provisions contained in
the first sentence of this Section 10.03 and in Section 10.02),
unless the holders of such Designated Senior Indebtedness or the Representative
of such holders shall have accelerated the maturity of such Designated Senior
Indebtedness, the Company may resume payments on the Notes after such Payment Blockage
Period, including any missed payments. 
In no event shall the total number of days during which any Payment
Blockage Period is in effect extend beyond the 179 days from the date of
receipt by the Trustee of the relevant Blockage Notice, and in no event shall
the total number of days during which any Payment Blockage Period is in effect
exceed 179 days during any 360 consecutive day period.  For purposes of this provision, no default
or event of default that existed or was continuing on the date of commencement
of any Payment Blockage Period with respect to the Designated Senior
Indebtedness initiating such Payment Blockage Period shall be, or be made, the
basis of the commencement of a subsequent Payment Blockage Period by the
Representative of such Designated Senior Indebtedness, unless such default or
event of default shall have been cured or waived for a period of not less than
90 consecutive days.

 

Section 10.04                          Acceleration of Notes.

 

If payment of the Notes is accelerated because of an
Event of Default, the Company will promptly notify holders of Senior
Indebtedness of the acceleration.

 

Section 10.05                          When Distribution Must Be Paid Over.

 

In the event that the Trustee or any Holder receives
any payment of any Obligations with respect to the Notes (other than Permitted
Junior Securities and payments made from any defeasance trust created pursuant
to Section 8.05 hereof) at a time when the Trustee or such Holder, as
applicable, has actual knowledge that such payment is prohibited by Section 10.03
hereof, such payment will be held by the Trustee or such Holder, in trust for
the benefit of, and will be paid forthwith over and delivered, upon written
request, to, the holders of Senior Indebtedness as their interests may appear
or their Representative under the agreement, indenture or other document (if
any) pursuant to which Senior Indebtedness may have been issued, as their
respective interests may appear, for application to the payment of all
Obligations with respect to Senior Indebtedness remaining unpaid to the extent
necessary to pay such Obligations in full in accordance with their terms, after
giving effect to any concurrent payment or distribution to or for the holders
of Senior Indebtedness.

 

With respect to the holders of Senior Indebtedness, the
Trustee undertakes to perform only those obligations on the part of the Trustee
as are specifically set forth in this Article 10, and no implied covenants or
obligations with respect to the holders of

 

98

 

Senior Indebtedness will
be read into this Indenture against the Trustee.  The Trustee will not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness, and will not be liable to any such holder if
the Trustee pays over or distributes to or on behalf of Holders or the Company
or any other Person money or assets to which any holders of Senior Indebtedness
are then entitled by virtue of this Article 10, except if such payment is made
as a result of the willful misconduct or gross negligence of the Trustee.

 

Section 10.06                          Notice by Company.

 

The Company will promptly notify the Trustee and the
Paying Agent of any facts known to the Company that would cause a payment of
any Obligations with respect to the Notes to violate this Article 10, but failure
to give such notice will not affect the subordination of the Notes to the
Senior Indebtedness as provided in this Article 10.

 

Section 10.07                          Subrogation.

 

After all Senior Indebtedness is paid in full and
until the Notes are paid in full, Holders of Notes will be subrogated (equally
and ratably with all other pari passu Indebtedness)
to the rights of holders of Senior Indebtedness to receive distributions
applicable to Senior Indebtedness to the extent that distributions otherwise
payable to the Holders of Notes have been applied to the payment of Senior
Indebtedness.  A distribution made under
this Article 10 to holders of Senior Indebtedness that otherwise would have
been made to Holders of Notes is not, as between the Company and Holders,
payment by the Company on the Notes.

 

Section 10.08                          Relative Rights.

 

This Article 10 defines the relative rights of Holders
of Notes and holders of Senior Indebtedness. 
Nothing in this Indenture will:

 

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

 

(2)                                  affect
the relative rights of Holders of Notes and creditors of the Company other than
their rights in relation to holders of Senior Indebtedness; or

 

(3)                                  prevent
the Trustee or any Holder of Notes from exercising its available remedies upon
a Default or Event of Default, subject to the rights of holders and owners of
Senior Indebtedness to receive distributions and payments otherwise payable to
Holders of Notes.

 

If the Company fails because of this Article 10 to pay
principal of, premium or interest on, a Note on the due date, the failure is
still a Default.

 

99

 

Section 10.09                          Subordination May Not Be Impaired by Company.

 

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

 

Section 10.10                          Distribution or Notice to Representative.

 

Whenever a distribution is to be made or a notice
given to holders of Senior Indebtedness, the distribution may be made and the
notice given to their Representative.

 

Upon any payment or distribution of assets of the
Company referred to in this Article 10, the Trustee and the Holders of Notes
will be entitled to rely upon any order or decree made by any court of competent
jurisdiction or upon any certificate of such Representative or of the
liquidating trustee or agent or other Person making any distribution to the
Trustee or to the Holders of Notes for the purpose of ascertaining the Persons
entitled to participate in such distribution, the holders of the Senior
Indebtedness and other Indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article 10.

 

Section 10.11                          Rights of Trustee and Paying Agent.

 

Notwithstanding the provisions of this Article 10 or
any other provision of this Indenture, the Trustee will not be charged with
knowledge of the existence of any facts that would prohibit the making of any
payment or distribution by the Trustee, and the Trustee and the Paying Agent
may continue to make payments on the Notes, unless the Trustee has received at
its Corporate Trust Office at least five Business Days prior to the date of
such payment written notice of facts that would cause the payment of any
Obligations with respect to the Notes to violate this Article 10.  Only the Company or a Representative may
give the notice.  Nothing in this
Article 10 will impair the claims of, or payments to, the Trustee under or
pursuant to Section 7.07 hereof.

 

The Trustee in its individual or any other capacity
may hold Senior Indebtedness with the same rights it would have if it were not
Trustee.  Any Agent may do the same with
like rights.

 

Section 10.12                          Authorization to Effect Subordination.

 

Each Holder of Notes, by such Holder’s acceptance
thereof, authorizes and directs the Trustee on such Holder’s behalf to take
such action as may be necessary or appropriate to effectuate the subordination
as provided in this Article 10, and appoints the Trustee to act as such
Holder’s attorney-in-fact for any and all such purposes.  If the

 

100

 

Trustee does not file a
proper proof of claim or proof of debt in the form required in any proceeding
referred to in Section 6.09 hereof at least 30 days before the expiration
of the time to file such claim, the Representatives are hereby authorized to
file an appropriate claim for and on behalf of the Holders of the Notes.

 

Section 10.13                          Amendments.

 

The provisions of this Article 10 may not be amended
or modified without the written consent of the holders of all Senior
Indebtedness.  In addition, any
amendment to, or waiver of, the provisions of this Article 10 that adversely
affects the rights of the Holders of the Notes will require the consent of the
Holders of Notes then outstanding.

 

Section
10.14                          Reliance on Judicial Order or Certificate of
Liquidating Agent.

 

Upon any payment or distribution of assets of the
Company referred to in this Article, the Trustee, subject to the provisions of
Section 6.01, and the Holders of the Notes shall be entitled to
conclusively rely upon any order or decree entered by any court of competent
jurisdiction in which such solvency, bankruptcy, receivership, liquidation,
reorganization, dissolution, winding up or similar case or proceeding is
pending, or a certificate of the trustee in bankruptcy, liquidating trustee,
custodian, receiver, assignee for the benefit of creditors, agent or other
person making such payment or distribution, delivered to the Trustee or to the
Holders of Notes, for the purpose of ascertaining the persons entitled to
participate in such payment or distribution, the holders of Senior Indebtedness
and other indebtedness of the Company, the amount thereof or payable thereon,
the amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article.

 

Section 10.15                          Trustee Not Fiduciary for Holders of Senior
Indebtedness.

 

The Trustee shall not be deemed to owe any fiduciary
duty to the holders of Senior Indebtedness and shall not be liable to any such
holders if the Trustee shall in good faith mistakenly pay over or distribute to
Holders of Notes or to the Company or to any other person cash, property or
securities to which any holders of Senior Indebtedness shall be entitled by
virtue of this Article or otherwise. 
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants or obligations
as are specifically set forth in this Article and no implied covenants or
obligations with respect to holders of Senior Indebtedness shall be read into
this Indenture against the Trustee.

 

101

 

ARTICLE 11

NOTE GUARANTEES

 

Section 11.01                          Guarantee.

 

(a)                                  Subject to this Article 11, each of
the Guarantors hereby, jointly and severally, unconditionally guarantees to
each Holder of a Note authenticated and delivered by the Trustee and to the
Trustee and its successors and assigns, irrespective of the validity and
enforceability of this Indenture, the Notes or the obligations of the Company
hereunder or thereunder, that:

 

(1)                                  the principal of, premium, if any,
and interest on, the Notes will be promptly paid in full when due, whether at
maturity, by acceleration, redemption or otherwise, and interest on the overdue
principal of and interest on the Notes, if any, if lawful, and all other
obligations of the Company to the Holders or the Trustee hereunder or
thereunder will be promptly paid in full or performed, all in accordance with
the terms hereof and thereof; and

 

(2)                                  in case of any extension of time of
payment or renewal of any Notes or any of such other obligations, that same
will be promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at stated maturity, by acceleration
or otherwise.

 

Failing payment when due of any amount so guaranteed
or any performance so guaranteed for whatever reason, the Guarantors will be
jointly and severally obligated to pay the same immediately.  Each Guarantor agrees that this is a
guarantee of payment and not a guarantee of collection.

 

(b)                                 The Guarantors hereby agree that
their obligations hereunder are unconditional, irrespective of the validity,
regularity or enforceability of the Notes or this Indenture, the absence of any
action to enforce the same, any waiver or consent by any Holder of the Notes
with respect to any provisions hereof or thereof, the recovery of any judgment
against the Company, any action to enforce the same or any other circumstance
which might otherwise constitute a legal or equitable discharge or defense of a
guarantor.  Each Guarantor hereby waives
diligence, presentment, demand of payment, filing of claims with a court in the
event of insolvency or bankruptcy of the Company, any right to require a
proceeding first against the Company, protest, notice and all demands
whatsoever and covenant that this Note Guarantee will not be discharged except
by complete performance of the obligations contained in the Notes and this
Indenture.

 

(c)                                  If any Holder or the Trustee is
required by any court or otherwise to return to the Company, the Guarantors or
any custodian, trustee, liquidator or other similar official acting in relation
to either the Company or the Guarantors, any amount paid by

 

102

 

either to the
Trustee or such Holder, this Note Guarantee, to the extent theretofore
discharged, will be reinstated in full force and effect.

 

(d)                                 Each Guarantor agrees that it will
not be entitled to any right of subrogation in relation to the Holders in
respect of any obligations guaranteed hereby until payment in full of all
obligations guaranteed hereby.  Each
Guarantor further agrees that, as between the Guarantors, on the one hand, and
the Holders and the Trustee, on the other hand, (1) the maturity of the
obligations guaranteed hereby may be accelerated as provided in Article 6
hereof for the purposes of this Note Guarantee, notwithstanding any stay,
injunction or other prohibition preventing such acceleration in respect of the
obligations guaranteed hereby, and (2) in the event of any declaration of
acceleration of such obligations as provided in Article 6 hereof, such
obligations (whether or not due and payable) will forthwith become due and
payable by the Guarantors for the purpose of this Note Guarantee.  The Guarantors will have the right to seek
contribution from any non-paying Guarantor so long as the exercise of such
right does not impair the rights of the Holders under the Note Guarantee.

 

Section 11.02                          Subordination of
Note Guarantee.

 

The Obligations of each Guarantor under its Note
Guarantee pursuant to this Article 11 will be junior and subordinated to the
Senior Indebtedness of such Guarantor on the same basis as the Notes are junior
and subordinated to Senior Indebtedness of the Company.  For the purposes of the foregoing sentence,
the Trustee and the Holders will have the right to receive and/or retain
payments by any of the Guarantors only at such times as they may receive and/or
retain payments in respect of the Notes pursuant to this Indenture, including
Article 10 hereof.

 

Section 11.03                          Limitation on
Guarantor Liability.

 

Each Guarantor, and by its acceptance of Notes, each
Holder, hereby confirms that it is the intention of all such parties that the
Note Guarantee of such Guarantor not constitute a fraudulent transfer or
conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance
Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to
the extent applicable to any Note Guarantee. 
To effectuate the foregoing intention, the Trustee, the Holders and the
Guarantors hereby irrevocably agree that the obligations of such Guarantor will
be limited to the maximum amount that will, after giving effect to such maximum
amount and all other contingent and fixed liabilities of such Guarantor that
are relevant under such laws, and after giving effect to any collections from,
rights to receive contribution from or payments made by or on behalf of any
other Guarantor in respect of the obligations of such other Guarantor under
this Article 11, result in the obligations of such Guarantor under its Note
Guarantee not constituting a fraudulent transfer or conveyance.

 

103

 

Section 11.04                          Execution and
Delivery of Note Guarantee.

 

To evidence its Note Guarantee set forth in
Section 11.01 hereof, each Guarantor hereby agrees that a notation of such
Note Guarantee substantially in the form attached as Exhibit E hereto will be
endorsed by an Officer of such Guarantor on each Note authenticated and
delivered by the Trustee and that this Indenture will be executed on behalf of
such Guarantor by one of its Officers.

 

Each Guarantor hereby agrees that its Note Guarantee
set forth in Section 11.01 hereof will remain in full force and effect
notwithstanding any failure to endorse on each Note a notation of such Note
Guarantee.

 

If an Officer whose signature is on this Indenture or
on the Note Guarantee no longer holds that office at the time the Trustee
authenticates the Note on which a Note Guarantee is endorsed, the Note
Guarantee will be valid nevertheless.

 

The delivery of any Note by the Trustee, after the
authentication thereof hereunder, will constitute due delivery of the Note
Guarantee set forth in this Indenture on behalf of the Guarantors.

 

In the event that the Company or any of its Restricted
Subsidiaries creates or acquires any Domestic Subsidiary after the date of this
Indenture, if required by Section 4.19 hereof, the Company will cause such
Domestic Subsidiary to comply with the provisions of Section 4.19 hereof
and this Article 11, to the extent applicable.

 

Section 11.05                          Guarantors May
Consolidate, etc., on Certain Terms.

 

Except as otherwise provided in Section 11.06
hereof, no Guarantor may sell or otherwise dispose of all or substantially all
of its assets to, or consolidate with or merge with or into (whether or not
such Guarantor is the surviving Person) another Person, other than the Company
or another Guarantor, unless:

 

(1)                                  immediately after giving effect to
such transaction, no Default or Event of Default exists; and

 

(2)                                  either:

 

(a)                                  subject to Section 11.06
hereof, the Person acquiring the property in any such sale or disposition or
the Person formed by or surviving any such consolidation or merger
unconditionally assumes all the obligations of that Guarantor under this
Indenture and its Note Guarantee on the terms set forth herein or therein, pursuant
to a supplemental indenture in form and substance reasonably satisfactory to
the Trustee; or

 

104

 

(b)                                 the Net Proceeds of such sale or
other disposition are applied in accordance with the applicable provisions of
this Indenture, including without limitation, Section 4.10 hereof.

 

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

 

Except as set forth in Articles 4 and 5 hereof, and
notwithstanding clauses 2(a) and (b) above, nothing contained in this Indenture
or in any of the Notes will prevent any consolidation or merger of a Guarantor
with or into the Company or another Guarantor, or will prevent any sale or
conveyance of the property of a Guarantor as an entirety or substantially as an
entirety to the Company or another Guarantor.

 

Section 11.06                          Releases.

 

(a)                                  In
the event of any sale or other disposition of all or substantially all of the
assets of any Guarantor, by way of merger, consolidation or otherwise, or a
sale or other disposition of all of the Capital Stock of any Guarantor, in each
case to a Person that is not (either before or after giving effect to such
transactions) the Company or a Restricted Subsidiary of the Company, then such
Guarantor (in the event of a sale or other disposition, by way of merger,
consolidation or otherwise, of all of the Capital Stock of such Guarantor) or
the corporation acquiring the property (in the event of a sale or other
disposition of all or substantially all of the assets of such Guarantor) will
be released and relieved of any obligations under its Note Guarantee; provided
that the Net Proceeds of such sale or other disposition are applied in
accordance with the applicable provisions of this Indenture, including without
limitation Section 4.10 hereof. 
Upon delivery by the Company to the Trustee of an Officers’ Certificate
and an Opinion of Counsel to the effect that such sale or other disposition was
made by the Company in accordance with the provisions of this Indenture,
including without limitation Section 4.10 hereof, the Trustee will execute
any documents reasonably required in order to evidence the release of any
Guarantor from its obligations under its Note Guarantee.

 

105

 

(b)                                 Upon
designation of any Guarantor as an Unrestricted Subsidiary in accordance with
the terms of this Indenture, such Guarantor will be released and relieved of
any obligations under its Note Guarantee.

 

(c)                                  Upon
Legal Defeasance in accordance with Article 8 hereof or satisfaction and
discharge of this Indenture in accordance with Article 12 hereof, each
Guarantor will be released and relieved of any obligations under its Note
Guarantee.

 

(d)                                 If
such Guarantor no longer constitutes a Domestic Subsidiary.

 

Any Guarantor not released from its obligations under
its Note Guarantee as provided in this Section 11.05 will remain liable
for the full amount of principal of and interest and premium, if any, on the
Notes and for the other obligations of any Guarantor under this Indenture as
provided in this Article 11.

 

ARTICLE 12

SATISFACTION AND DISCHARGE

 

Section 12.01                          Satisfaction and Discharge.

 

This Indenture will be discharged and will cease to be
of further effect as to all Notes issued hereunder, when:

 

(1)                                  either:

 

(a)                                  all Notes that have been
authenticated, except lost, stolen or destroyed Notes that have been replaced
or paid and Notes for whose payment money has theretofore been deposited in
trust or segregated and held in trust by the Company or any Guarantor and
thereafter repaid to the Company or discharged from their trust, have been
delivered to the Trustee for cancellation; or

 

(b)                                 all Notes that have not been
delivered to the Trustee for cancellation have become due and payable by reason
of the mailing of a notice of redemption or otherwise or will become due and
payable within one year and the Company or any Guarantor has irrevocably
deposited or caused to be deposited with the Trustee as trust funds in trust
solely for the benefit of the Holders, cash in U.S. dollars, non-callable
Government Securities, or a combination thereof, in such amounts as will be
sufficient, without consideration of any reinvestment of interest, to pay and
discharge the entire Indebtedness on the Notes not delivered to the Trustee for
cancellation for principal, premium, if any, and accrued interest to the date
of maturity or redemption;

 

106

 

(2)                                  no Default or Event of Default has
occurred and is continuing on the date of such deposit (other than a Default or
Event of Default resulting from the borrowing of funds to be applied to such
deposit) and the deposit will not result in a breach or violation of, or
constitute a default under, any other material instrument to which the Company
or any Guarantor is a party or by which the Company or any Guarantor is bound;

 

(3)                                  the Company or any Guarantor has
paid or caused to be paid all sums payable by it under this Indenture; and

 

(4)                                  the Company has delivered
irrevocable instructions to the Trustee under this Indenture to apply the
deposited money toward the payment of the Notes at maturity or on the
redemption date, as the case may be.

 

In addition, the Company must deliver an Officers’
Certificate and an Opinion of Counsel to the Trustee stating that all
conditions precedent to satisfaction and discharge have been satisfied.

 

Notwithstanding the satisfaction and discharge of this
Indenture, if money has been deposited with the Trustee pursuant to
subclause (b) of clause (1) of this Section 12.01, the
provisions of Sections 12.02 and 8.06 hereof will survive.  In addition, nothing in this
Section 12.01 will be deemed to discharge those provisions of
Section 7.07 hereof, that, by their terms, survive the satisfaction and
discharge of this Indenture.

 

Section 12.02                          Application of Trust Money.

 

Subject to the provisions of Section 8.06 hereof,
all money deposited with the Trustee pursuant to Section 12.01 hereof
shall be held in trust and applied by it, in accordance with the provisions of
the Notes and this Indenture, to the payment, either directly or through any
Paying Agent (including the Company acting as its own Paying Agent) as the
Trustee may determine, to the Persons entitled thereto, of the principal (and
premium, if any) and interest for whose payment such money has been deposited
with the Trustee; but such money need not be segregated from other funds except
to the extent required by law.

 

If the Trustee or Paying Agent is unable to apply any
money or Government Securities in accordance with Section 12.01 hereof 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 any Guarantor’s obligations under this
Indenture and the Notes shall be revived and reinstated as though no deposit
had occurred pursuant to Section 12.01 hereof; provided that if the Company
has made any payment of principal of, premium, if any, or interest on, any
Notes because of the reinstatement of its obligations, the Company shall be
subrogated to the rights of

 

107

 

the Holders of such Notes
to receive such payment from the money or Government Securities held by the
Trustee or Paying Agent.

 

ARTICLE 13

MISCELLANEOUS

 

Section 13.01                          Trust Indenture Act Controls.

 

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

 

Section 13.02                          Notices.

 

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

 

If to the Company and/or any Guarantor:

 

B&G Foods, Inc.

Four Gatehall Drive, Suite 110

Parsippany, NJ  07054

Facsimile No.:  (973)401-6550

Attention:  Chief Financial Officer

 

With a copy to:

Dechert LLP

4000 Bell Atlantic Tower

1717 Arch Street

Philadelphia, PA  19103

Facsimile No.:  (215) 994-2222

Attention:  Christopher G. Karras, Esq.

 

If to the Trustee:

The Bank of New York

101 Barclay Street, Fl. 8W

New York, NY 
10286

Facsimile No.:  (212) 815-5707

Attention:  Corporate Trust
Administration

 

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

 

108

 

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

 

Any notice or communication to a Holder will be mailed
by first class mail, certified or registered, return receipt requested, or by
overnight air courier guaranteeing next day delivery to its address shown on
the register kept by the Registrar.  Any
notice or communication will also be so mailed to any Person described in TIA
§ 313(c), to the extent required by the TIA.  Failure to mail a notice or communication to a Holder or any
defect in it will not affect its sufficiency with respect to other Holders.

 

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

 

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

 

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

 

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

 

Section 13.04                          Certificate and Opinion as to Conditions Precedent.

 

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

 

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

 

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

 

109

 

Section 13.05                          Statements Required in Certificate or Opinion.

 

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

 

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

 

(2)                                  a brief statement as to the nature
and scope of the examination or investigation upon which the statements or
opinions contained in such certificate or opinion are based;

 

(3)                                  a statement that, in the opinion of
such Person, he or she has made such examination or investigation as is
necessary to enable him or her to express an informed opinion as to whether or
not such covenant or condition has been satisfied; and

 

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

 

Section 13.06                          Rules by Trustee and Agents.

 

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

 

Section 13.07                          No Personal Liability of Directors, Officers, Employees and
Stockholders.

 

No past, present or future director, officer,
employee, direct or indirect incorporator, Affiliate, stockholder or
controlling Person, of the Company or any Guarantor, as such, or any successor
entity, will have any liability for any obligations of the Company or the
Guarantors under the Notes, this Indenture, the Note Guarantees or for any
claim based on, in respect of, or by reason of, such obligations or their
creation.  Each Holder of Notes by
accepting a Note waives and releases all such liability.  The waiver and release are part of the
consideration for issuance of the Notes. 
The waiver may not be effective to waive liabilities under the federal
securities laws.

 

Section 13.08                          Governing Law.

 

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

 

110

 

Section 13.09                          No Adverse Interpretation of Other Agreements.

 

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

 

Section 13.10                          Successors.

 

All agreements of the Company in this Indenture and
the Notes will bind its successors.  All
agreements of the Trustee in this Indenture will bind its successors.  All agreements of each Guarantor in this
Indenture will bind its successors, except as otherwise provided in
Section 11.05 hereof.

 

Section 13.11                          Severability.

 

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

 

Section 13.12                          Counterpart Originals.

 

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

 

Section 13.13                          Table of Contents, Headings, etc.

 

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

 

Section
13.14                          Waiver of Jury Trial.

 

EACH OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS
INDENTURE, THE NOTES OR THE TRANSACTION CONTEMPLATED HEREBY.

 

[Signatures on following page]

 

111

 

SIGNATURES

 

Dated as of October 14,
2004

 

	
   

  	
  B&G FOODS,
  INC. (F/K/A B&G FOODS

  HOLDINGS CORP.)

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert C.
  Cantwell

  	
   

  
	
   

  	
   

  	
  Name: Robert C.
  Cantwell

  	
   

  
	
   

  	
   

  	
  Title: Executive
  Vice President of Finance

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  BGH HOLDINGS,
  INC.

  	
   

  
	
   

  	
  BLOCH &
  GUGGENHEIMER, INC.

  	
   

  
	
   

  	
  HERITAGE
  ACQUISITION CORP.

  	
   

  
	
   

  	
  MAPLE GROVE
  FARMS OF VERMONT, INC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

 

	
   

  	
  ORTEGA HOLDINGS
  INC.

  	
   

  
	
   

  	
  POLANER, INC.

  	
   

  
	
   

  	
  TRAPPEY’S FINE
  FOODS, INC.

  	
   

  
	
   

  	
  WILLIAM
  UNDERWOOD COMPANY

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert C.
  Cantwell

  	
   

  
	
   

  	
   

  	
  Name: Robert C.
  Cantwell

  	
   

  
	
   

  	
   

  	
  Title:
  Authorized Officer

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  THE BANK OF NEW
  YORK

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert A.
  Massimillo

  	
   

  
	
   

  	
   

  	
  Name: Robert A.
  Massimillo

  	
   

  
	
   

  	
   

  	
  Title: Vice
  President

  	
   

  

 

2

 

EXHIBIT A

 

[Face of Note]

 

CUSIP/CINS
                

 

12.0% Senior Subordinated Notes due 2016

 

	
  No. 

  	
  $                

  

 

B&G FOODS, INC.

 

(F/KA/ B&G FOODS HOLDINGS CORP.)

 

promises to pay to

 

or registered assigns,

 

the principal sum of
                                                                                                                                                                   
DOLLARS

on                      ,
2016.

 

Interest Payment
Dates:  January 30, April 30, July 30
and October 30.

 

Record Dates:  December 31, March 31, June 30 and September
30.

 

Dated: 
                              ,
200

 

	
   

  	
  B&G FOODS,
  INC.

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  This is one of the Notes
  referred to

  in the within-mentioned Indenture:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  THE
  BANK OF NEW YORK,

  as Trustee

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Authorized Signatory

  	
   

  	
   

  	
   

  	
   

  

 

A-1

 

[Back of Note]

12.0% Senior Subordinated Notes due 2016

 

[Insert the Global Note Legend, if
applicable pursuant to the provisions of the Indenture]

 

Capitalized terms used herein have the meanings
assigned to them in the Indenture referred to below unless otherwise indicated.

 

(1)                                  INTEREST.  B&G Foods, Inc., a Delaware corporation
(the “Company”), promises to pay interest on the principal amount
of this Note at 12.0 % per annum from October 14, 2004 until maturity.  The Company will pay interest quarterly in
arrears on January 30, April 30, July 30 and October 30 of each year, or
if any such day is not a Business Day, on the next succeeding Business Day
(each, an “Interest Payment Date”).  Interest on the Notes will accrue from the
most recent date to which interest has been paid on the Initial Notes or, if no
interest has been paid, from the date of issuance of the Initial Notes; provided
that if there is no existing Default in the payment of interest, and if this
Note is authenticated between a record date referred to on the face hereof and
the next succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided further that the first Interest
Payment Date shall be January 30, 2005. 
The Company will pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal and premium, if any,
from time to time on demand at a rate that is 1% per annum in excess of the
rate then in effect to the extent lawful; it will pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
installments of interest (without regard to any applicable grace periods) from
time to time on demand at the same rate to the extent lawful.  Interest will be computed on the basis of a
360-day year of twelve 30-day months.

 

(2)                                  METHOD OF
PAYMENT.  The Company will
pay interest on the Notes (except defaulted interest) to the Persons who are
registered Holders of Notes at the close of business on December 31, March 31,
June 30 and September 30 next preceding the Interest Payment Date,
even if such Notes are canceled after such record date and on or before such
Interest Payment Date, except as provided in Section 2.12 of the Indenture
with respect to defaulted interest.  The
Notes will be payable as to principal, premium and, if any, interest at the
office or agency of the Company maintained for such purpose within or without
the City and State of New York, or, at the option of the Company, payment of
interest may be made by check mailed to the Holders at their addresses set
forth in the register of Holders; provided that payment by wire transfer of
immediately available funds will be required with respect to principal of and
interest and premium, if any, on all Global Notes and all other Notes the
Holders of which will have provided wire transfer instructions to the Company
or

 

A-2

 

the Paying Agent. 
Such payment will be in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts.

 

(3)                                  PAYING AGENT
AND REGISTRAR.  Initially,
The Bank of New York, the Trustee under the Indenture, will act as Paying Agent
and Registrar.  The Company may change
any Paying Agent or Registrar without notice to any Holder.  The Company or any of its Subsidiaries may
act in any such capacity.

 

(4)                                  INDENTURE.  The Company issued the Notes under an
Indenture dated as of October 14, 2004 (the “Indenture”) among the Company, the
Guarantors and the Trustee.  The terms
of the Notes include those stated in the Indenture and those made part of the
Indenture by reference to the TIA.  The
Notes are subject to all such terms, and Holders are referred to the Indenture
and such Act for a statement of such terms. 
To the extent any provision of this Note conflicts with the express
provisions of the Indenture, the provisions of the Indenture shall govern and
be controlling.  The Notes are unsecured
obligations of the Company.  The
Indenture does not limit the aggregate principal amount of Notes that may be
issued thereunder.

 

(5)                                  OPTIONAL REDEMPTION.  On and after October 30, 2009, the
Company may redeem all or a part of the Notes upon not less than 30 nor more
than 60 days notice, at the redemption prices (expressed as percentages of
principal amount) set forth below plus accrued and unpaid interest on the Notes
redeemed, to the applicable redemption date, if redeemed during the
twelve-month period beginning on October 30 of the years indicated below,
subject to the rights of Holders of Notes on the relevant record date to
receive interest on the relevant interest payment date: 

 

	
  Year

  	
   

  	
  Percentage

  	
   

  
	
  2009

  	
   

  	
  106.000

  	
  %

  
	
  2010

  	
   

  	
  104.000

  	
  %

  
	
  2011

  	
   

  	
  102.000

  	
  %

  
	
  2012 and thereafter

  	
   

  	
  100.000

  	
  %

  

 

Unless the Company defaults in the payment of the
redemption price, interest will cease to accrue on the Notes or portions
thereof called for redemption on the applicable redemption date.

 

The Notes will not be redeemable at the Company’s
option prior to October 30, 2009.

 

(6)                                  MANDATORY REDEMPTION.  The Company is not be required to make
mandatory redemption or sinking fund payments with respect to the Notes.

 

A-3

 

(7)                                  REPURCHASE AT THE OPTION OF HOLDER.

 

(a)                                  If
there is a Change of Control, the Company will be required to make an offer (a “Change of Control Offer”) to each Holder to repurchase all or any part
(equal to $7.15 or an integral multiple thereof) of each Holder’s Notes at a
purchase price in cash equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest thereon
to the date of purchase, subject to the rights of Holders on the relevant
record date to receive interest due on the relevant interest payment date (the “Change of Control Payment”).  No
earlier than ten and no later than 20 days following any Change of Control, the
Company will mail a notice to each Holder setting forth the procedures
governing the Change of Control Offer as required by the Indenture.

 

(b)                                 If
the Company or a Restricted Subsidiary of the Company consummates any Asset
Sales, within five days of each date on which the aggregate amount of Excess
Proceeds exceeds $10.0 million, the Company will commence an offer to all
Holders of Notes and all holders of other pari
passu Indebtedness containing provisions similar to those set forth
in the Indenture with respect to offers to purchase or redeem with the proceeds
of sales of assets (an “Asset Sale
Offer”) pursuant to
Section 3.09 of the Indenture to purchase the maximum principal amount of
Notes (including any Additional Notes) and such other pari passu Indebtedness that
may be purchased out of the Excess Proceeds at an offer price in cash in an
amount equal to 100% of the principal amount thereof plus accrued and unpaid interest thereon to the date of
purchase in accordance with the procedures set forth in the Indenture.  To the extent that the aggregate amount of
Notes (including any Additional Notes) and other pari passu Indebtedness
tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the
Company (or such Restricted Subsidiary) may use such deficiency for any purpose
not otherwise prohibited by the Indenture. 
If the aggregate principal amount of Notes and other pari passu
Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess
Proceeds, the Trustee shall select the Notes and such other pari passu Indebtedness to be purchased on
a pro rata basis.  Holders of Notes that are the subject of an
offer to purchase will receive an Asset Sale Offer from the Company prior to
any related purchase date and may elect to have such Notes purchased by
completing the form entitled “Option of
Holder to Elect Purchase”
attached to the Notes.

 

(8)                                  NOTICE OF
REDEMPTION.  Notice of
redemption will be mailed at least 30 days but not more than 60 days before the
redemption date to each Holder whose Notes are to be redeemed at its registered
address, except that redemption notices may be mailed more than 60 days prior
to a redemption date if the notice is issued in connection with a defeasance of
the Notes or a satisfaction or discharge of the Indenture.  Notes in denominations larger than $7.15 may
be

 

A-4

 

redeemed in part but only in whole multiples of $7.15,
unless all of the Notes held by a Holder are to be redeemed.

 

(9)                                  DENOMINATIONS,
TRANSFER, EXCHANGE.  The
Notes are in registered form without coupons in denominations of $7.15 and
integral multiples of $7.15.  The
transfer of Notes may be registered and Notes may be exchanged as provided in
the Indenture.  The Registrar and the
Trustee may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and the Company may require a Holder to pay
any taxes and fees required by law or permitted by the Indenture.  The Company need not exchange or register
the transfer of any Note or portion of a Note selected for redemption, except
for the unredeemed portion of any Note being redeemed in part.  Also, the Company need not exchange or
register the transfer of any Notes for a period of 15 days before a selection
of Notes to be redeemed or during the period between a record date and the
corresponding Interest Payment Date.

 

(10)                            PERSONS
DEEMED OWNERS.  The
registered Holder of a Note may be treated as its owner for all purposes.

 

(11)                            AMENDMENT,
SUPPLEMENT AND WAIVER. 
Subject to certain exceptions, the Indenture or the Notes or the Note
Guarantees may be amended or supplemented with the consent of the Holders of at
least a majority in aggregate principal amount of the then outstanding Notes
including Additional Notes, if any, voting as a single class, and any existing
Default or Event or Default or compliance with any provision of the Indenture
or the Notes or the Note Guarantees may be waived with the consent of the
Holders of a majority in aggregate principal amount of the then outstanding
Notes including Additional Notes, if any, voting as a single class.  Without the consent of any Holder of a Note,
the Indenture or the Notes or the Note Guarantees may be amended or
supplemented to cure any ambiguity, omission, defect or inconsistency, to
provide for uncertificated Notes in addition to or in place of certificated
Notes, to provide for the assumption of the Company’s or a Guarantor’s
obligations to Holders of Notes and Note Guarantees in case of a merger or
consolidation, to make any change that would provide any additional rights or
benefits to the Holders of Notes or that does not adversely affect the legal
rights under the Indenture of any such Holder, to comply with the requirements
of the SEC in order to effect or maintain the qualification of the Indenture
under the TIA, to conform the text of the Indenture, or the Notes to any
provision of the “Description of
Senior Subordinated Notes”
section of the Company’s Prospectus dated October 7, 2004, relating to the
initial offering of the Notes, to the extent that such provision in that “Description of Senior Subordinated Notes” was intended to be a verbatim recitation
of a provision of the Indenture, the Note Guarantees or the Notes, to provide
for or confirm the issuance of Additional Notes in accordance with the

 

A-5

 

limitations set forth in the Indenture or to allow any
Guarantor to execute a supplemental indenture to the Indenture and/or a Note
Guarantee with respect to the Notes.

 

(12)                            DEFAULTS AND
REMEDIES.  Events of Default
include:  (i) default for 30 days
in the payment when due of interest on the Notes; (ii) default in the
payment when due of the principal of, or premium, if any, on, the Notes when
the same becomes due and payable at maturity, upon redemption (including in
connection with an offer to purchase) or otherwise; (iii) failure by the
Company or any of its Restricted Subsidiaries to comply with Section 5.01
of the Indenture; (iv) failure by the Company or any of its Restricted
Subsidiaries for 30 days to comply with Sections 4.10 and 4.15 of the
Indenture; (v) failure by the Company or any of its Restricted Subsidiaries
for 60 days after notice to the Company by the Trustee or the Holders of at
least 25% in aggregate principal amount of the Notes then outstanding voting as
a single class to comply with any of the other agreements in the Indenture or
the Notes; (vi) default under certain other agreements relating to
Indebtedness of the Company which default results in the acceleration of such
Indebtedness prior to its express maturity; (vii) certain final judgments
for the payment of money that remain undischarged for a period of 60 days;
(viii) certain events of bankruptcy or insolvency with respect to the
Company or any of its Restricted Subsidiaries that is a Significant Subsidiary
or any group of Restricted Subsidiaries that, taken together, would constitute
a Significant Subsidiary; (ix) payment by the Company of dividends on its
common stock during the continuance of an Event of Default or pursuant to the
second clause (1) of paragraph (a) of Section 4.07 of the Indenture at a
time when such payment was not permitted pursuant to such section and
(x) except as permitted by the Indenture, any Note Guarantee is held in
any judicial proceeding to be unenforceable or invalid or ceases for any reason
to be in full force and effect, or any Guarantor, or any Person acting on its
behalf denies or disaffirms its obligations under such Guarantor’s Note
Guarantee.  If any Event of Default
occurs and is continuing, the Trustee or the Holders of at least 25% in
aggregate principal amount of the then outstanding Notes may declare all the
Notes to be due and payable immediately. 
Notwithstanding the foregoing, in the case of an Event of Default
arising from certain events of bankruptcy or insolvency, all outstanding Notes
will become due and payable immediately without further action or notice.  Holders may not enforce the Indenture or the
Notes except as provided in the Indenture. 
Subject to certain limitations, Holders of a majority in aggregate principal
amount of the then outstanding Notes may direct the Trustee in its exercise of
any trust or power.  The Trustee may
withhold from Holders of the Notes notice of any continuing Default or Event of
Default (except a Default or Event of Default relating to the payment of
principal or interest or premium, if any) if it determines that withholding
notice is in their interest.  The
Holders of a majority in aggregate principal amount of the then outstanding
Notes by notice to

 

A-6

 

the Trustee may, on behalf of the Holders of all of
the Notes, rescind an acceleration or waive any existing Default or Event of
Default and its consequences under the Indenture except a continuing Default or
Event of Default in the payment of the principal of, premium, if any, or
interest on, the Notes.  The Company is
required to deliver to the Trustee annually a statement regarding compliance
with the Indenture, and the Company is required, upon becoming aware of any
Default or Event of Default, to deliver to the Trustee a statement specifying
such Default or Event of Default.

 

(13)                            SUBORDINATION. 
Payment of principal, interest and premium, if any, on the
Notes is subordinated to the prior payment of Senior Indebtedness on the terms
provided in the Indenture.

 

(14)                            SUBSEQUENT ISSUANCE. 
The Company may only issue Additional Notes in accordance
with Section 4.21 of the Indenture.

 

The Company agrees, and by purchasing the Notes each
Holder and each owner of a beneficial interest in a Global Note shall be deemed
to have agreed, that, upon the issuance by the Company of any Additional Notes,
if the Company determines that such Additional Notes should be assigned a
different CUSIP number than the CUSIP number assigned to the Initial Notes,
then immediately following such issuance (and immediately following any issuance
of Additional Notes thereafter) a portion of each such Holder’s or beneficial
owner’s Initial Notes and/or Additional Notes, as applicable, or beneficial
ownership interest therein, will automatically, without any action by such
Holder or beneficial owner, be exchanged (each, an “Automatic Exchange”) for a portion of each other Holder’s
Initial Notes and/or Additional Notes or each other beneficial owner’s
beneficial interest in the Initial Notes and/or Additional Notes, as
applicable, such that each Holder and owner of a beneficial interest in a
Global Note will hold Notes or beneficial interests in the Global Notes of each
issuance in the same proportion as each other Holder and owner of beneficial
interests in the Global Notes.  The
aggregate stated principal amount of Notes owned by each Holder and owner of a
beneficial interest in a Global Note will not change as a result of the
Automatic Exchange.  Immediately
following the Automatic Exchange, the Company and the Trustee will instruct the
Depository to facilitate the combination of the Notes issued prior to the date
of issuance of such Additional Notes and such Additional Notes into inseparable
units (“Note Units”) in
accordance with the procedures of the Depository.  The Note Units will be assigned a new CUSIP number, and the
transfers and exchanges of beneficial interests in the Note Units will be
effected through the Depository.

 

At least ten (10) business days prior to the closing
of the issuance of Additional Notes that will result in an Automatic Exchange,
the Company shall notify the Trustee in writing of its intention to consummate
such subsequent

 

A-7

 

issuance and shall instruct the Trustee and Depository
to take any action necessary to effect the Automatic Exchange.  Such notice may be revoked at any time prior
to the date fixed for such Automatic Exchange.

 

The Company agrees, and by acceptance of beneficial
ownership in the Notes each beneficial owner of the Notes shall be deemed to
have agreed, that (1) the Company will report any “original issue discount” (as determined for U.S. federal income
tax purposes) associated with the Initial Notes and Additional Notes among all
beneficial owners in proportion to their ownership of the aggregate principal
amount of Notes and (2) each beneficial owner of the Notes shall report
such original issue discount in this manner and shall not take an inconsistent
position for any applicable tax purpose.

 

(15)                            TRUSTEE
DEALINGS WITH COMPANY.  The
Trustee, in its individual or any other capacity, may make loans to, accept
deposits from, and perform services for the Company or its Affiliates, and may
otherwise deal with the Company or its Affiliates, as if it were not the
Trustee.

 

(16)                            NO RECOURSE
AGAINST OTHERS.  No past,
present or future director, officer, employee, direct or indirect incorporator,
Affiliate, stockholder or controlling Person, of the Company or any Guarantor,
as such, or any successor entity, will have any liability for any obligations
of the Company or the Guarantors under the Notes, this Indenture, the Note
Guarantees or for any claim based on, in respect of, or by reason of, such
obligations or their creation.  Each
Holder of Notes by accepting a Note waives and releases all such
liability.  The waiver and release are
part of the consideration for issuance of the Notes.  The waiver may not be effective to waive liabilities under the
federal securities laws.

 

(17)                            AUTHENTICATION.  This Note will not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.

 

(18)                            ABBREVIATIONS.  Customary abbreviations may be used in the
name of a Holder or an assignee, such as: 
TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT
TEN (= joint tenants with right of survivorship and not as tenants in common),
CUST (= Custodian), and U/G/M/A (= Uniform Gifts 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 Notes,
and the Trustee may use CUSIP numbers in notices of redemption as a convenience
to Holders.  No representation is made
as to the accuracy of such numbers either as printed on the Notes or as
contained in any notice of redemption, and reliance may be placed only on the
other identification numbers placed thereon.

 

A-8

 

(20)                            TAX
TREATMENT.  By acceptance of
a beneficial ownership interest in the Notes, each beneficial owner of Notes
will be deemed to have agreed (1) to treat itself as owner of the Notes
for all purposes, including the preparation and filing of the United States
federal, state, local or foreign tax return, report, or other information; (2) to
treat the Notes as indebtedness for all tax purposes and (3) if such
beneficial owner’s Notes are represented by EISs, to treat the acquisition of
an EIS as the acquisition of the Notes and Class A Common Stock which are
represented by the EIS and to allocate the purchase price of the EIS between
the Notes and the Class A Common Stock in the amounts of $7.15 and $7.85
respectively.

 

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

 

The Company will furnish to any Holder upon written
request and without charge a copy of the Indenture and/or the Registration
Rights Agreement.  Requests may be made
to:

 

B&G Foods, Inc.  (f/k/a B&G Foods Holdings Corp.)

Four Gatehall Drive, Suite
110

Parsippany, NJ  07054

Attention:  Chief Financial Officer

 

A-9

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

(I) or (we) assign and
transfer this Note to:

(Insert assignee’s legal
name)

 

 

 

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

 

 

 

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

 

and irrevocably appoint

to transfer this Note on
the books of the Company.  The agent may
substitute another to act for him.

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Your Signature:

  	
   

  
	
   

  	
   

  	
   

  	
  (Sign exactly as your
  name appears on the face of this Note)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Signature Guarantee*:

  	
   

  	
   

  
							

 

*                 Participant in a recognized
Signature Guarantee Medallion Program (or other signature guarantor acceptable
to the Trustee).

 

A-10

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you want to elect to have this Note purchased by
the Company pursuant to Section 4.10 or 4.15 of the Indenture, check the
appropriate box below:

 

	
  Section 4.10

  	
  Section 4.15

  

 

If you want to elect to have only part of the Note
purchased by the Company pursuant to Section 4.10 or Section 4.15 of
the Indenture, state the amount you elect to have purchased:

 

$                    

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Your Signature:

  	
   

  
	
   

  	
   

  	
   

  	
  (Sign exactly as your
  name appears on the face of this Note)

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Tax Identification No.:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
  Signature Guarantee*:

  	
   

  	
   

  
								

 

*                 Participant in a recognized
Signature Guarantee Medallion Program (or other signature guarantor acceptable
to the Trustee).

 

A-11

 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE
GLOBAL NOTE*

 

The following exchanges of a part of this Global Note
for an interest in another Global Note or for a Definitive Note, or exchanges
of a part of another Global Note or Definitive Note for an interest in this
Global Note, have been made:

 

	
  Date of Exchange

  	
   

  	
  Amount of

  decrease in

  Principal Amount

  at maturity of

  this Global Note

  	
   

  	
  Amount of

  increase in

  Principal Amount

  at maturity of

  this Global Note

  	
   

  	
  Principal Amount

  at maturity of this

  Global Note

  following such

  decrease

  (or increase)

  	
   

  	
  Signature of

  authorized officer

  of Trustee or

  Custodian

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

*                 This schedule should be included
only if the Note is issued in global form.

 

A-12

 

EXHIBIT B

 

FORM OF NOTATION OF GUARANTEE

 

For value received, each Guarantor (which term
includes any successor Person under the Indenture) has, jointly and severally,
unconditionally guaranteed, to the extent set forth in the Indenture and
subject to the provisions in the Indenture dated as of
                                ,
2004 (the “Indenture”) among B&G Foods, Inc., (the “Company”),
the Guarantors party thereto and
                                                ,
as trustee (the “Trustee”), (a) the due and
punctual payment of the principal of, premium and Liquidated Damages, if any,
and interest on, the Notes, whether at maturity, by acceleration, redemption or
otherwise, the due and punctual payment of interest on overdue principal of and
interest on the Notes, if any, if lawful, and the due and punctual performance
of all other obligations of the Company to the Holders or the Trustee all in
accordance with the terms of the Indenture and (b) in case of any
extension of time of payment or renewal of any Notes or any of such other obligations,
that the same will be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at stated maturity, by
acceleration or otherwise.  The
obligations of the Guarantors to the Holders of Notes and to the Trustee
pursuant to the Note Guarantee and the Indenture are expressly set forth in
Article 10 of the Indenture and reference is hereby made to the Indenture for
the precise terms of the Note Guarantee.

 

Capitalized terms used but not defined herein have the
meanings given to them in the Indenture.

 

 

	
   

  	
  [NAME OF
  GUARANTOR(S)]

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

B-1

 

EXHIBIT C

 

FORM OF SUPPLEMENTAL INDENTURE

TO BE DELIVERED BY SUBSEQUENT GUARANTORS

 

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of
                            ,
200   , among                                   
(the “Guaranteeing Subsidiary”), a subsidiary of
B&G Foods, Inc. (or its permitted successor), a Delaware corporation (the “Company”),
the Company, the other Guarantors (as defined in the Indenture referred to
herein) and The Bank of New York, as trustee under the Indenture referred to
below (the “Trustee”).

 

W I T N E S S E T H

 

WHEREAS, the Company has heretofore executed and
delivered to the Trustee an indenture (the “Indenture”), dated as of
                      ,
2004 providing for the issuance of      % Senior
Subordinated Notes due 2016 (the “Notes”);

 

WHEREAS, the Indenture provides that under certain
circumstances the Guaranteeing Subsidiary shall execute and deliver to the
Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiary
shall unconditionally guarantee all of the Company’s Obligations under the
Notes and the Indenture on the terms and conditions set forth herein (the “Note Guarantee”);
and

 

WHEREAS, pursuant to Section 9.01 of the
Indenture, the Trustee is authorized to execute and deliver this Supplemental
Indenture.

 

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

 

1.                                       CAPITALIZED
TERMS.  Capitalized terms used herein
without definition shall have the meanings assigned to them in the Indenture.

 

2.                                       AGREEMENT
TO GUARANTEE.  The Guaranteeing
Subsidiary hereby agrees to provide an unconditional Guarantee on the terms and
subject to the conditions set forth in the Note Guarantee and in the Indenture
including but not limited to Article 10 thereof.

 

3.                                       NO
RECOURSE AGAINST OTHERS.  No past,
present or future director, officer, employee, incorporator, stockholder or
agent of the Guaranteeing Subsidiary, as such, shall have any liability for any
obligations of the Company or any Guaranteeing Subsidiary under the Notes, any
Note Guarantees, the Indenture or this Supplemental Indenture or for any claim
based on, in respect of, or by reason of, such obligations or their
creation.  Each Holder of the Notes by
accepting a Note waives and releases all such liability.  The waiver and release are part of the
consideration for issuance of the Notes.

 

C-1

 

Such waiver may not be
effective to waive liabilities under the federal securities laws and it is the
view of the SEC that such a waiver is against public policy.

 

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

 

5.                                       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.

 

6.                                       EFFECT
OF HEADINGS.  The Section headings
herein are for convenience only and shall not affect the construction hereof.

 

7.                                       THE
TRUSTEE.  The Trustee shall not be
responsible in any manner whatsoever for or in respect of the validity or
sufficiency of this Supplemental Indenture or for or in respect of the recitals
contained herein, all of which recitals are made solely by the Guaranteeing
Subsidiary and the Company.

 

C-2

 

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

 

Dated: 
                        ,
20     

 

	
   

  	
  [GUARANTEEING
  SUBSIDIARY]

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  B&G FOODS,
  INC.

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  [EXISTING
  GUARANTORS]

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  [THE BANK OF NEW
  YORK],

  as Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized
  Signatory

  	
   

  

 

C-3

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