Document:

Exhibit
4.17

 

FOSTER
WHEELER LLC

as Issuer

 

the
Guarantors party hereto

 

and

 

WELLS
FARGO BANK, NATIONAL ASSOCIATION

not in its individual capacity but solely as Trustee

 

Indenture

 

Dated
as of
                     ,
2004

 

[   ]%

Senior Secured Notes

Due 2011, Series A

 

[   ]%

Senior Secured Notes

Due 2011, Series B

 

 

CROSS-REFERENCE TABLE

 

	
  TIA Sections

  	
   

  	
  Indenture Sections

  
	
   

  	
   

  	
   

  	
   

  
	
  §

  	
  310(a)

  	
   

  	
  7.10

  
	
   

  	
  (b)

  	
   

  	
  7.08

  
	
   

  	
  (c)

  	
   

  	
  N/A

  
	
  §

  	
  311(a)

  	
   

  	
  7.03

  
	
   

  	
  (b)

  	
   

  	
  7.03

  
	
   

  	
  (c)

  	
   

  	
  N/A

  
	
  §

  	
  312

  	
   

  	
  12.02

  
	
   

  	
  (b)

  	
   

  	
  12.02

  
	
   

  	
  (c)

  	
   

  	
  12.02

  
	
  §

  	
  313(a)

  	
   

  	
  7.06

  
	
   

  	
  (b)

  	
   

  	
  7.06

  
	
   

  	
  (c)

  	
   

  	
  7.06

  
	
   

  	
  (d)

  	
   

  	
  7.06

  
	
  §

  	
  314(a)

  	
   

  	
  4, 4.02

  
	
   

  	
  (b)

  	
   

  	
  10.02

  
	
   

  	
  (c)

  	
   

  	
  12.04

  
	
   

  	
  (d)

  	
   

  	
  10.03, 10.04, 12.04

  
	
   

  	
  (e)

  	
   

  	
  12.05

  
	
   

  	
  (f)

  	
   

  	
  N/A

  
	
  §

  	
  315(a)

  	
   

  	
  7.01, 7.02

  
	
   

  	
  (b)

  	
   

  	
  7.02, 7.05

  
	
   

  	
  (c)

  	
   

  	
  7.01

  
	
   

  	
  (d)

  	
   

  	
  7.02

  
	
   

  	
  (e)

  	
   

  	
  6.12, 7.02

  
	
  §

  	
  316(a)

  	
   

  	
  2.05, 6.02, 6.04, 6.05

  
	
   

  	
  (b)

  	
   

  	
  6.06, 6.07

  
	
   

  	
  (c)

  	
   

  	
  12.02

  
	
  §

  	
  317(a) (1)

  	
   

  	
  6.08

  
	
   

  	
  (a) (2)

  	
   

  	
  6.09

  
	
   

  	
  (b)

  	
   

  	
  2.03

  
	
  §

  	
  318

  	
   

  	
  12.01

  

 

 

RECITALS

 

	
  ARTICLE 1 DEFINITIONS AND
  INCORPORATION BY REFERENCE

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 1.01. Definitions

  	
   

  
	
   

  	
  Section 1.02. Trust Indenture Act
  Provisions

  	
   

  
	
   

  	
  Section 1.03. Rules of Construction

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 2 THE NOTES

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 2.01. Form, Dating and
  Denominations; Legends

  	
   

  
	
   

  	
  Section 2.02. Execution and
  Authentication; Exchange Notes

  	
   

  
	
   

  	
  Section 2.03. Registrar, Paying Agent
  and Authenticating Agent; Paying Agent to Hold Money in Trust

  	
   

  
	
   

  	
  Section 2.04. Replacement Notes

  	
   

  
	
   

  	
  Section 2.05. Outstanding Notes

  	
   

  
	
   

  	
  Section 2.06. Temporary Notes

  	
   

  
	
   

  	
  Section 2.07. Cancellation

  	
   

  
	
   

  	
  Section 2.08. CUSIP and CINS Numbers

  	
   

  
	
   

  	
  Section 2.09. Registration, Transfer
  and Exchange

  	
   

  
	
   

  	
  Section 2.10. Restrictions on
  Transfer and Exchange

  	
   

  
	
   

  	
  Section 2.11. Temporary Offshore
  Global Notes

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 3 REDEMPTION; OFFER TO
  PURCHASE

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 3.01. Optional Redemption

  	
   

  
	
   

  	
  Section 3.02. Optional Redemption;
  Make Whole

  	
   

  
	
   

  	
  Section 3.03. Method and Effect of
  Redemption

  	
   

  
	
   

  	
  Section 3.04. Offer to Purchase

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 4 COVENANTS

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 4.01. Payment Of Notes

  	
   

  
	
   

  	
  Section 4.02. Maintenance of
  Office or Agency

  	
   

  
	
   

  	
  Section 4.03. Existence

  	
   

  
	
   

  	
  Section 4.04. Payment of Taxes
  and other Claims

  	
   

  
	
   

  	
  Section 4.05. Limitation on Debt
  and Disqualified or Preferred Stock

  	
   

  
	
   

  	
  Section 4.06. Limitation on
  Restricted Payments

  	
   

  
	
   

  	
  Section 4.07. Limitation on
  Liens

  	
   

  
	
   

  	
  Section 4.08. Limitation on Sale
  and Leaseback Transactions

  	
   

  
	
   

  	
  Section 4.09. Limitation on
  Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries

  	
   

  
	
   

  	
  Section 4.10. Repurchase of
  Notes upon a Change of Control

  	
   

  
	
   

  	
  Section 4.11. Limitation on
  Asset Sales

  	
   

  
	
   

  	
  Section 4.12. Limitation on
  Transactions with Affiliates

  	
   

  
	
   

  	
  Section 4.13. Additional Note
  Guarantees and Collateral After the Issue Date

  	
   

  
	
   

  	
  Section 4.14. Designation of
  Restricted and Unrestricted Subsidiaries

  	
   

  
	
   

  	
  Section 4.15. Financial Reports

  	
   

  

 

i

 

	
   

  	
  Section 4.16. Reports to Trustee

  	
   

  
	
   

  	
  Section 4.17. Impairment of
  Security Interest; Security Document Covenants

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 5 CONSOLIDATION, MERGER OR
  SALE OF ASSETS

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 5.01. Consolidation,
  Merger or Sale of Assets by the Company; No Lease of All or Substantially All
  Assets

  	
   

  
	
   

  	
  Section 5.02. Merger by
  Subsidiary Guarantors

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 6 DEFAULT AND REMEDIES

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 6.01. Events of Default

  	
   

  
	
   

  	
  Section 6.02. Consequences of an
  Event of Default

  	
   

  
	
   

  	
  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
  to Receive Payment

  	
   

  
	
   

  	
  Section 6.08. Collection Suit by
  Trustee

  	
   

  
	
   

  	
  Section 6.09. Trustee May File
  Proofs of Claim

  	
   

  
	
   

  	
  Section 6.10. Priorities

  	
   

  
	
   

  	
  Section 6.11. Restoration of
  Rights and Remedies

  	
   

  
	
   

  	
  Section 6.12. Undertaking for
  Costs

  	
   

  
	
   

  	
  Section 6.13. Rights and
  Remedies Cumulative

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 7 THE TRUSTEE

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 7.01. General

  	
   

  
	
   

  	
  Section 7.02. Certain Rights of
  Trustee

  	
   

  
	
   

  	
  Section 7.03. Trustee May Hold
  Notes

  	
   

  
	
   

  	
  Section 7.04. Trustee’s
  Disclaimer

  	
   

  
	
   

  	
  Section 7.05. Notice of Default

  	
   

  
	
   

  	
  Section 7.06. Reports by Trustee
  to Holders

  	
   

  
	
   

  	
  Section 7.07. Compensation and
  Indemnity

  	
   

  
	
   

  	
  Section 7.08. Replacement of
  Trustee

  	
   

  
	
   

  	
  Section 7.09. Successor Trustee
  by Merger

  	
   

  
	
   

  	
  Section 7.10. Eligibility

  	
   

  
	
   

  	
  Section 7.11. Money Held in
  Trust

  	
   

  
	
   

  	
  Section 7.12. Appointment of
  Co-Trustee

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 8 DEFEASANCE AND DISCHARGE

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 8.01. Discharge of
  Company’s Obligations

  	
   

  
	
   

  	
  Section 8.02. Legal Defeasance

  	
   

  
	
   

  	
  Section 8.03. Covenant
  Defeasance

  	
   

  
	
   

  	
  Section 8.04. Application of
  Trust Money

  	
   

  
	
   

  	
  Section 8.05. Repayment to
  Company

  	
   

  
	
   

  	
  Section 8.06. Reinstatement

  	
   

  

 

ii

 

	
  ARTICLE 9 AMENDMENTS, SUPPLEMENTS AND
  WAIVERS

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 9.01. Amendments Without
  Consent of Holders

  	
   

  
	
   

  	
  Section 9.02. Amendments With
  Consent of Holders

  	
   

  
	
   

  	
  Section 9.03. Effect of Consent

  	
   

  
	
   

  	
  Section 9.04. Trustee’s Rights
  and Obligations

  	
   

  
	
   

  	
  Section 9.05. Conformity With
  Trust Indenture Act

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 10 COLLATERAL ARRANGEMENTS

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 10.01. Collateral
  Documents

  	
   

  
	
   

  	
  Section 10.02. Recordings and
  Opinions

  	
   

  
	
   

  	
  Section 10.03. Release of
  Collateral

  	
   

  
	
   

  	
  Section 10.04. Permitted
  Releases Not To Impair Lien; Trust Indenture Act Requirements

  	
   

  
	
   

  	
  Section 10.05. Suits To Protect
  the Collateral

  	
   

  
	
   

  	
  Section 10.06. Purchaser
  Protected

  	
   

  
	
   

  	
  Section 10.07. Powers
  Exercisable by Receiver or Trustee

  	
   

  
	
   

  	
  Section 10.08. Disposition of
  Obligations Received

  	
   

  
	
   

  	
  Section 10.09. Determinations
  Relating to Collateral

  	
   

  
	
   

  	
  Section 10.10. Release upon
  Termination of the Company’s Obligations

  	
   

  
	
   

  	
  Section 10.11. Notes Collateral
  Agent’s Duties

  	
   

  
	
   

  	
  Section 10.12. Additional
  Secured Obligations

  	
   

  
	
   

  	
  Section 10.13. Designation of
  New Indenture Documents

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 11 GUARANTEES 

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 11.01. The Guarantees

  	
   

  
	
   

  	
  Section 11.02. Guarantee
  Unconditional

  	
   

  
	
   

  	
  Section 11.03. Discharge;
  Reinstatement

  	
   

  
	
   

  	
  Section 11.04. Waiver by the
  Guarantors

  	
   

  
	
   

  	
  Section 11.05. Subrogation and
  Contribution

  	
   

  
	
   

  	
  Section 11.06. Stay of
  Acceleration

  	
   

  
	
   

  	
  Section 11.07. Limitation on
  Amount of Guarantee

  	
   

  
	
   

  	
  Section 11.08. Execution and
  Delivery of Guarantee

  	
   

  
	
   

  	
  Section 11.09. Release of
  Guarantee

  	
   

  
	
   

  	
  Section 11.10. No Suspension of
  Remedies

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE 12 MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Section 12.01. Trust Indenture
  Act of 1939

  	
   

  
	
   

  	
  Section 12.02. Noteholder
  Communications; Noteholder Actions

  	
   

  
	
   

  	
  Section 12.03. Notices

  	
   

  
	
   

  	
  Section 12.04. Certificate and
  Opinion as to Conditions Precedent

  	
   

  
	
   

  	
  Section 12.05. Statements
  Required in Certificate or Opinion

  	
   

  
	
   

  	
  Section 12.06. Payment Date
  Other Than a Business Day

  	
   

  
	
   

  	
  Section 12.07. Governing Law

  	
   

  
	
   

  	
  Section 12.08. No Adverse
  Interpretation of Other Agreements

  	
   

  
	
   

  	
  Section 12.09. Successors

  	
   

  
	
   

  	
  Section 12.10. Duplicate
  Originals

  	
   

  

 

iii

 

	
   

  	
  Section 12.11. Separability

  	
   

  
	
   

  	
  Section 12.12. Table of
  Contents and Headings

  	
   

  
	
   

  	
  Section 12.13. No Liability of
  Directors, Officers, Employees, Incorporators, Members and Stockholders

  	
   

  
	
   

  	
  Section 12.14. Submission to Jurisdiction

  	
   

  
	
   

  	
  Section 12.15. Appointment of
  Agent

  	
   

  

 

EXHIBITS

 

	
  EXHIBIT A

  	
  Form of Series A Note

  
	
  EXHIBIT B

  	
  Form of Series B Note

  
	
  EXHIBIT C

  	
  Form of Supplemental Indenture

  
	
  EXHIBIT D

  	
  Restricted Legend

  
	
  EXHIBIT E

  	
  DTC Legend

  
	
  EXHIBIT F

  	
  Regulation S Certificate

  
	
  EXHIBIT G

  	
  Rule 144A Certificate

  
	
  EXHIBIT H

  	
  Institutional Accredited Investor Certificate

  
	
  EXHIBIT I

  	
  Certificate of Beneficial Ownership

  
	
  EXHIBIT J

  	
  Form of Subordinated Intercompany Note

  
	
  EXHIBIT K

  	
  Form of Unsubordinated Intercompany Note

  
	
  EXHIBIT L

  	
  Temporary Offshore Global
  Note Legend

  

 

iv

 

INDENTURE, dated as of
                     ,
2004, between Foster Wheeler LLC, a Delaware limited liability company (the “Company”), the
Guarantors party hereto and Wells Fargo Bank, National Association, not in its
individual capacity but solely as Trustee.

 

RECITALS

 

The Company has duly
authorized the execution and delivery of this Indenture to provide for the
issuance of (i) initially up to $150,000,000 aggregate principal amount of the
Company’s [    ]% Senior Secured Notes due
2011, Series A and up to an additional $120,000,000 Series A Notes issuable
solely in exchange for the Series B Notes, in each case having the same terms
as the Series A Notes except with respect to registration and Additional
Interest (as defined below)(the “Series A Notes”), and (ii) up to $120,000,000 aggregate
principal amount of the Company’s [   
]% Senior Secured Notes Due 2011, Series B (the “Series B Notes”, and together with the Series
A Notes, the “Notes”).  All things necessary to make this Indenture
a valid agreement of the Company, in accordance with its terms, have been done,
and the Company has done all things necessary to make the Notes, when executed
by the Company and authenticated and delivered by the Trustee and duly issued
by the Company, the valid obligations of the Company as hereinafter provided.

 

In addition, the
Guarantors party hereto have duly authorized the execution and delivery of this
Indenture as guarantors of the Notes. 
All things necessary to make this Indenture a valid agreement of each
Guarantor, in accordance with its terms, have been done, and each Guarantor has
done all things necessary to make the Note Guarantees, when the Notes are
executed by the Company and authenticated and delivered by the Trustee and duly
issued by the Company, the valid obligations of such Guarantor as hereinafter
provided.

 

This Indenture is subject
to, and will be governed by, the provisions of the Trust Indenture Act that are
required to be a part of and govern indentures qualified under the Trust
Indenture Act.

 

THIS INDENTURE WITNESSETH

 

For and in consideration
of the premises and the purchase of the Notes by the Holders thereof, the
parties hereto covenant and agree, for the equal and proportionate benefit of
all Holders, as follows:

 

1

 

ARTICLE 1

DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.01.  Definitions.

 

“Acquired Debt” means Debt of
a Person (1) assumed by such Person from another Person in connection with an
Asset Acquisition from such other Person or (2) existing at the time the Person
merges with or into the Company or a Restricted Subsidiary, or becomes a
Restricted Subsidiary and in each case was not Incurred in connection with such
Asset Acquisition, or in contemplation of, the Person merging with or into the
Company or a Restricted Subsidiary or becoming a Restricted Subsidiary.

 

“Additional Interest” means
additional interest owed to the Holders pursuant to the Registration Rights
Agreement.

 

“Additional Registration Rights Agreement”
means the Registration Rights Agreement dated the Issue Date between Parent,
the Company, the Guarantors and the parties named in Schedule A thereto,
with respect to the Common Shares, the Preferred Shares and the Notes held by
such parties.

 

“Affiliate” means, with
respect to any Person, any other Person directly or indirectly controlling,
controlled by, or under direct or indirect common control with, such Person.
for purposes of this definition, “control” (including, with correlative
meanings, the terms “controlling,” “controlled by” and “under common control
with”) with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting securities, by
contract or otherwise. Notwithstanding the foregoing, a Joint Venture of the
Company shall not be considered an “Affiliate” of the Company or any Restricted
Subsidiary so long as the other parties to the joint venture that are not
Affiliates of the Company or any Restricted Subsidiaries own at least 50% of
the Voting Stock of such joint venture.

 

“Agent” means any Registrar,
Paying Agent or Authenticating Agent.

 

“Agent Member” means a member
of, or a participant in, the Depositary.

 

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

 

(1)                                  the
present value at such redemption date of (i) the redemption price of the Note
at
[                 ],
2006 (such redemption price being set forth in Section 3.01), plus (ii)
all required interest payments due on the Note through
[               ],
2006 (excluding accrued but unpaid interest to the redemption date), computed
using a discount rate equal to the Treasury Rate as of such redemption date
plus 50 basis points; over

 

(2)                                  the
then outstanding principal amount.

 

“Asset Acquisition” means the
acquisition by the Company or any Restricted Subsidiary of the assets of any
Person which constitute the assets of such Person substantially as an entirety

 

2

 

or the assets of any
division, operating unit or line of business of such Person substantially as an
entirety.

 

“Asset Sale” means any sale,
lease, transfer, conveyance or other disposition of any assets outside the
ordinary course of business by the Company or any Restricted Subsidiary,
including by means of a merger, consolidation or similar transaction and
including any sale or issuance of the Equity Interests of any Restricted
Subsidiary (each of the above referred to in this definition as a
“disposition”), provided that the following are not included in the
definition of “Asset Sale”:

 

(1)                                  a
disposition to the Company or a Restricted Subsidiary (including the sale or
issuance by the Company or any Restricted Subsidiary of any Equity Interests of
any Restricted Subsidiary to the Company or any Restricted Subsidiary);

 

(2)                                  the
disposition by the Company or any Restricted Subsidiary in the ordinary course
of business of (i) cash and cash management investments, (ii) inventory and
other assets acquired and held for resale in the ordinary course of business,
(iii) damaged, worn out or obsolete assets, or (iv) rights granted to others
pursuant to leases or licenses;

 

(3)                                  the
sale or discount of accounts receivable or claims arising in the ordinary
course of business in connection with the compromise or collection thereof;

 

(4)                                  a
disposition governed by the provisions of Section 5.01;

 

(5)                                  a
Restricted Payment permitted under the provisions of Section 4.06 or a
Permitted Investment;

 

(6)                                  the
issuance of Disqualified or Preferred Stock pursuant to the provisions of
Section 4.05;

 

(7)                                  dispositions
of accounts receivable and related assets to a Securitization Subsidiary;

 

(8)                                  the
grant of any Permitted Lien and the exercise by any Person in whose favor a
Permitted Lien is granted of any of its rights in respect of that Permitted
Lien;

 

(9)                                  the
sale of substantially all of the assets or Equity Interests of any Joint
Venture or Subsidiary, whose assets consist solely of any Construction Project
if sold within two years of commencement of operations of such Construction
Project;

 

(10)                            any
settlement with insurers relating to asbestos claims or liability with any
insurer of the Company or any Subsidiary;

 

(11)                            any
disposition in a transaction or series of related transactions of assets with a
Fair Market Value of less than $1,000,000 in any twelve-month period; and

 

3

 

(12)                            the
sale or transfer of the Capital Stock of any of Foster Wheeler South Africa
(Proprietary) Limited, Foster Wheeler Properties (Proprietary) Limited, or any
other Restricted Subsidiary organized under the laws of South Africa to the
extent necessary to comply with the Broad-Based Black Economic Empowerment Act
53 of 2003.

 

“Attributable Debt” means, in
respect of a Sale and Leaseback Transaction the present value, discounted at
the interest rate implicit in the Sale and Leaseback Transaction, of the total
obligations of the lessee for rental payments during the remaining term of the
lease in the Sale and Leaseback Transaction.

 

“Authenticating Agent” refers
to a Person appointed by the Trustee pursuant to Section 2.03(a) engaged
to authenticate the Notes in the stead of the Trustee.

 

“Average Life” means, with
respect to any Debt, the quotient obtained by dividing (i) the sum of the
products of (x) the number of years from the date of determination to the dates
of each successive scheduled principal payment of such Debt and (y) the amount
of such principal payment by (ii) the sum of all such principal payments.

 

“bankruptcy default” means an
event of default specified clauses (7) or (8) of Section 6.01.

 

“Board of Directors” means the
board of directors or comparable governing body of a corporation, partnership,
limited liability company, association, trust or other entity.

 

“Board Resolution” means a
resolution duly adopted by the Board of Directors which is certified by the
Secretary or an Assistant Secretary of the Company and remains in full force
and effect as of the date of its certification.

 

“Business Day” means any day
except a Saturday, Sunday or other day on which commercial banks in New York
City or in the city where the Corporate Trust Office of the Trustee is located
are authorized by law to be closed for business.

 

“Capital Lease” means, with
respect to any Person, any lease of any property which, in conformity with
GAAP, is required to be capitalized on the balance sheet of such Person.

 

“Capital Stock” means, with
respect to any Person, any and all shares of stock of a corporation,
partnership interests or other equivalent interests (however designated,
whether voting or non-voting) in such Person’s equity, entitling the holder to
receive a share of the profits and losses, and a distribution of assets, after
liabilities, of such Person.

 

“Cash Equivalents” means:

 

(1)                                  United
States dollars, or money in foreign currencies received in the ordinary course
of business that are readily convertible into United States dollars;

 

(2)                                  U.S.
Government Obligations with maturities not exceeding one year from the date of
acquisition;

 

4

 

(3)                                  (i)
demand deposits, (ii) time deposits and certificates of deposit with maturities
of one year or less from the date of acquisition, (iii) bankers’ acceptances
with maturities not exceeding one year from the date of acquisition, and (iv)
overnight bank deposits, in each case with any bank or trust company organized
or licensed under the laws of the United States or any state thereof having capital,
surplus and undivided profits in excess of $250,000,000 whose short-term debt
is rated “A-2” or higher by S&P or “P-2” or higher by Moody’s or at least
an equivalent rating category of another nationally recognized securities
rating agency;

 

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

 

(5)                                  commercial
paper rated at least P-1 by Moody’s or A-1 by S&P or at least an equivalent
rating category of another nationally recognized securities rating agency and
maturing within 270 days after the date of acquisition;

 

(6)                                  money
market funds at least 95% of the assets of which consist of investments of the
type described in clauses (1) through (5) above; and

 

(7)                                  in
the case of a Foreign Restricted Subsidiary, substantially similar investments,
of comparable credit quality, denominated in the currency of any jurisdiction
in which such Person conducts business.

 

“Certificate of Beneficial Ownership”
means a certificate substantially in the form of Exhibit I.

 

“Certificated Note” means a
Note in registered individual form without interest coupons.

 

“Change of Control” means:

 

(1)                                  the
direct or indirect sale, 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
Restricted Subsidiaries taken as a whole, to any Person other than a Parent
Guarantor that assumes the Notes in compliance with Section 5.01;

 

(2)                                  any
“person” or “group” (as such terms are used for purposes of Sections 13(d) and
14(d) of the Exchange Act) is or becomes the “beneficial owner” (as such term
is used in Rules 13d-3 under the Exchange Act), directly or indirectly, of more
than 50% of the total voting power of the Voting Stock of Parent;

 

(3)                                  with
respect to each of (a) the Company and (b) for so long as the Company is a
Subsidiary of Parent, Parent, individuals who on the Issue Date constituted the
Board of Directors of such Person, together with any new directors of such
Person whose election by the Board of Directors or whose nomination for election
by the stockholders of such Person was approved by a majority of the directors
then still in office who were either directors of such Person or whose election
or nomination for

 

5

 

election was
previously so approved, cease for any reason to constitute a majority of the
Board of Directors of such Person then in office;

 

(4)                                  Parent
ceases to own, indirectly, at least 51% of the Capital Stock of the Company or
Foster Wheeler Holdings Ltd. shall cease to hold 100% of the Capital Stock of
the Company (or, if Foster Wheeler Holdings Ltd. shall no longer own the shares
of Capital Stock of the Company, the Parent shall cease to own 100% of such
Capital Stock);

 

(5)                                  the
adoption by the Board of Directors of the Company of a plan contemplating to
the liquidation or dissolution of the Company; or

 

(6)                                  Parent
or the Company consolidates with, or merges with or into, any Person or sells
or otherwise disposes of all or substantially all of its assets to any Person,
or any Person, consolidates with, or merges with or into, Parent or the Company
in any such event pursuant to a transaction in which the outstanding Voting
Stock of Parent or the Company is converted into or exchanged for cash,
securities or other property, other than any such transaction where the Voting
Stock of Parent or the Company, as the case may be, immediately prior to such
transaction is converted or exchanged for Voting Stock (other than Disqualified
Stock) of the surviving or transferee Person constituting a majority of the
outstanding shares of such Voting Stock of such surviving or transferee Person
(immediately after giving effect to such issuance).

 

Notwithstanding anything
to the contrary, any merger of the Company with any Parent Guarantor (other than
Parent) that assumes the Notes and otherwise complies with Section 5.01
and whose Capital Stock is pledged to secure the Notes shall not constitute a
Change of Control.

 

“Code” means the Internal
Revenue Code of 1986.

 

“Collateral” means all
property of the Company and the Guarantors, whether now owned or existing or
hereafter acquired, upon which a Lien is purported to be created hereunder or
under the Collateral Documents.

 

 “Collateral Documents” means (i) the
Security Agreement, (ii) any mortgage, pledge, assignment, deed of trust,
security agreement or other instrument pursuant to which any Lien on any
property of any Parent Guarantor, the Company or any of the Guarantors is
granted as security for the obligations of the Company and the Guarantors in
respect of the Notes, (iii) the Intercreditor Agreement, and (iv) any
supplements or other instruments or documents entered into in connection with
any of the foregoing, in each case as each of the foregoing may from time to
time be amended.

 

“Commission” means the
Securities and Exchange Commission.

 

“Common Stock” means Capital
Stock that is not entitled to any preference on dividends or distributions,
upon liquidation or otherwise.

 

“Company” means the party
named as such in the first paragraph of this Indenture or any successor obligor
under this Indenture and the Notes pursuant to Section 5.01.

 

6

 

“Consolidated Cash Flow”
means, for any period, the sum (without duplication) of

 

(1)                                  Consolidated
Net Income for such period, plus

 

(2)                                  Fixed
Charges for such period, to the extent deducted in calculating Consolidated Net
Income for such period, plus

 

(3)                                  to
the extent deducted in calculating Consolidated Net Income for such period and
as determined on a consolidated basis for the Company and its Restricted
Subsidiaries in conformity with GAAP:

 

(A)                              income
taxes and income tax adjustments (whether positive or negative) for such
period, other than income taxes or income tax adjustments (whether positive or
negative) attributable to Asset Sales or extraordinary gains or losses; and

 

(B)                                depreciation,
amortization and all other non-cash items reducing Consolidated Net Income for
such period (including impairment loss on long-lived assets, but not including
non-cash charges in a period which reflect cash expenses paid or to be paid in
any subsequent period), less all non-cash items increasing Consolidated Net
Income (other than accrual of revenue in the ordinary course of business); plus

 

(4)                                  net
after-tax losses attributable to Asset Sales, and net after-tax extraordinary
or non-recurring losses, to the extent reducing Consolidated Net Income; plus

 

(5)                                  unusual
or nonrecurring non-cash charges or expenses; plus

 

(6)                                  non-cash
charges for the write-off of unamortized debt costs; plus

 

(7)                                  non-cash
charges Incurred in connection with the closure of facilities determined to be
underperforming by the Board of Directors of the Company in its sole
discretion; plus

 

(8)                                  expenses
in connection with the restructuring transactions described in this prospectus,
or any equity offerings;

 

provided that, with respect to any
Restricted Subsidiary, such items will be added only to the extent and in the
same proportion that the relevant Restricted Subsidiary’s net income was
included in calculating Consolidated Net Income (and consistent therewith, with
respect to Restricted Subsidiaries containing a minority interest, the portion
of such items that are allocable to such minority interest shall not be added).

 

“Consolidated Net Income”
means, for any period, the aggregate net income (or loss) of the Company and
its Restricted Subsidiaries for such period determined on a consolidated basis
in conformity with GAAP (and consistent therewith, with respect to the net
income of Restricted Subsidiaries containing a minority interest, amounts
allocable to such minority interest shall be

 

7

 

netted against the net
income of such Restricted Subsidiaries in accordance with GAAP), provided
that the following (without duplication) will be excluded in computing
Consolidated Net Income:

 

(1)                                  the
net income (or loss) of any Person that is not a Subsidiary or that is
accounted for by the equity method of accounting, provided that there shall be
included in Consolidated Net Income for such period any dividends or other
distributions paid in cash to the Company or such Restricted Subsidiary by such
Person in such period;

 

(2)                                  the
net income of any Restricted Subsidiary to the extent that the declaration or
payment of dividends or similar distributions or the making or repayment of
loans during such period to the Company or its Restricted Subsidiaries by such
Restricted Subsidiary of such net income, on the date of determination, is not
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 (including statutorily imposed limitations on any Restricted
Subsidiary’s ability to distribute in any period more than its statutory income
for such period), applicable to that Restricted Subsidiary or its stockholders
in such period; except to the extent that the excluded portion of such net
income is actually distributed in cash by way of dividends, distributions,
payments of royalties or management fees, repayments of loans or making of
loans in such period to the Company or any Restricted Subsidiary that is not
subject to restrictions of this type; provided that, (i) in the case of
repayment or making of loans, the amount of such excluded portion to be
included in net income shall be equal to the excess, if any, of cash
distributed by repayment or making of loans over the amount of loans made to
such Restricted Subsidiary or repaid to such Restricted Subsidiary by the
Company or any Restricted Subsidiary that is not subject to restrictions of
this type and (ii) none of the excluded portion of such net income for any
period shall be deemed to have been distributed until the included portion of
such net income shall first have been distributed;

 

(3)                                  any
net after-tax extraordinary gains or losses; and

 

(4)                                  the
cumulative effect of any change in accounting principles.

 

“Consolidated Net Worth” means
on any date of determination, the consolidated shareholders’ equity, or total
members’ equity (deficit), as the case may be, (excluding Disqualified Stock)
of such Person and its Subsidiaries, as determined in accordance with GAAP on a
consolidated basis.

 

“Consolidated Tangible Assets”
means, on any date, the total assets of the Company and its Subsidiaries on a
consolidated basis as reflected under GAAP, less the following items:

 

(1)                                  assets
of Unrestricted Subsidiaries;

 

(2)                                  Investments
in Joint Ventures; and

 

(3)                                  amounts
representing goodwill, trademarks, patents, provisions for unamortized debt
discount and other intangible assets.

 

8

 

“Construction Projects” means
any facility engineered or constructed by the Company or any Subsidiary or
Joint Venture of the Company with the intent (as determined by the Company or
any Restricted Subsidiary) to sell such facility upon or within two years of
commencement of operations of such facility, and in any event including without
limitation, SET S.r.l., Societa Enipower Ferrara S.r.l., and MF Power S.r.l.

 

“Contract Performance Arrangements”
means, (A) with respect to any engineering, procurement, construction,
manufacturing, equipment, or supply contract or bid for such contract entered
into or made by any Person, letters of credit, bank guarantees, bankers’
acceptances, bid bonds, retention bonds, advance payment bonds or other similar
instruments supporting such Person’s performance obligations thereunder, and
(B) with respect to any contract for the acquisition or disposition of any
business or assets entered into by any Person, letters of credit, bank
guarantees, bankers’ acceptances, bid bonds, retention bonds, advance payment
bonds or other similar instruments supporting such Person’s indemnification,
purchase price adjustment or advance payment or similar obligations thereunder,
including in each case any reimbursement or similar obligations with respect
thereto and the provision of cash collateral with respect thereto, and provided,
in each case, that such arrangements are entered into in the ordinary course of
business and do not support Debt.

 

“Controlled Joint Venture”
means any joint venture, partnership or similar arrangement (i) in which the
Company or any Restricted Subsidiary, directly or indirectly, owns at least 20%
or more of the Equity Interests of such Person and (ii) as to which the
Company, directly or indirectly through one or more Restricted Subsidiaries,
exercises day-to-day management control, including Non-Wholly Owned
Subsidiaries.

 

“Convertible Notes” means the
6.50% Convertible Subordinated Notes due 2007 issued by Parent and guaranteed
by the Company.

 

“Corporate Trust Office” means
the office of the Trustee at which the corporate trust business of the Trustee
is principally administered, which at the date of this Indenture is located at
Wells Fargo Corporate Trust, c/o The Depository Trust Company, 1st
Floor, TADS Department, 55 Water Street, New York, NY  10041 .

 

“Credit Agreement” means the
Third Amended and Restated Term Loan and Revolving Credit Agreement dated as of
August 2, 2002, among the Company, Foster Wheeler USA Corporation, Foster
Wheeler Power Group, Inc., Foster Wheeler Energy Corporation, the guarantors
signatory thereto, the lenders signatory thereto, Bank of America, N.A., as
Administrative Agent and Collateral Agent and Bank of America Securities LLC,
as Lead Arranger and Book Manager, as amended by Amendment No. 1 thereto dated
November 8, 2002, Amendment No. 2 thereto dated March 24, 2003,
Amendment No. 3 thereto dated July 14, 2003, Amendment No. 4 thereto dated
October 30, 2003, and Amendment No. 5 thereto dated May 14, and as further
amended from time to time.

 

“Credit Facility or Credit Facilities”
means, one or more debt facilities or financings (including, without
limitation, the Credit Agreement) or commercial paper facilities or financings
(including, without limitation, any senior secured notes), in each case, with
banks or other institutional lenders providing for revolving credit loans, term
loans, receivables financing

 

9

 

(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 in each case to the extent such Debt is permitted to be Incurred
under such facility in accordance with Section 4.05(b)(1).

 

“Debt” means, with respect to
any Person, without duplication,

 

(1)                                  all
indebtedness of such Person for borrowed money;

 

(2)                                  all
obligations of such Person evidenced by bonds, debentures, notes or other
similar instruments;

 

(3)                                  all
Trade Obligations and all Performance Obligations;

 

(4)                                  all
obligations of such Person to pay the deferred and unpaid purchase price of
property or services which are recorded as liabilities under GAAP, excluding
trade payables, advances on contracts and deferred compensation and similar
liabilities arising in the ordinary course of business;

 

(5)                                  all
rent obligations of such Person as lessee under Capital Leases;

 

(6)                                  all
Debt of other Persons Guaranteed by such Person to the extent so Guaranteed;

 

(7)                                  all
Debt of other Persons secured by a Lien on any asset of such Person, whether or
not such Debt is assumed by such Person; and

 

(8)                                  all
obligations of such Person under Hedging Agreements.

 

Notwithstanding the
foregoing, “Debt” shall not include prepayments or advances by customers or
other arrangements that result in cash being held on the balance sheet as
“restricted cash” entered into or made in the ordinary course of business for
services or products to be provided or delivered in the future.

 

The amount of Debt of any
Person will be deemed to be:

 

(A)                              with
respect to contingent obligations, the maximum liability upon the occurrence of
the contingency giving rise to the obligation;

 

(B)                                with
respect to Debt secured by a Lien on an asset of such Person but not otherwise
the obligation, contingent or otherwise, of such Person, the lesser of (x) the
Fair Market Value of such asset on the date the Lien attached and (y) the
amount of such Debt;

 

10

 

(C)                                with
respect to any Debt issued with original issue discount, the face amount of
such Debt less the remaining unamortized portion of the original issue discount
of such Debt;

 

(D)                               with
respect to any Hedging Agreement, the net amount payable if such Hedging
Agreement were terminated at that time due to default by such Person;

 

(E)                                 otherwise,
the outstanding principal amount thereof, interest on Debt that is more than 90
days past due and interest that is more than 90 days past due (provided that no
accrual of interest pursuant to this clause (E) shall constitute an
Incurrence); and

 

(F)                                 with
respect to any Debt incurred pursuant to Section 4.05(b)(8), in the event
that (x) another holder of Equity Interests in the Joint Venture referred to in
such paragraph has agreed to reimburse or indemnify the Company or such
Restricted Subsidiary for any amounts paid pursuant to the Guarantee referred
to in said paragraph and (y) such holder has an Investment Grade Rating, then
the amount of Debt deemed to be incurred pursuant to such paragraph shall be
limited to portion thereof that is not entitled to the benefits of such
reimbursement or indemnification; provided that in the event the
indemnification or reimbursement obligation shall terminate or otherwise be
invalidated, such termination shall be deemed an Incurrence of that portion of
Debt previously entitled to such indemnification or reimbursement obligation.

 

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

 

“Depositary” means the
depositary of each Global Note, which will initially be DTC.

 

“Disqualified Equity Interests”
means Equity Interests that by their terms or upon the happening of any event
are:

 

(1)                                  required
to be redeemed or redeemable at the option of the holder on or prior to the
date 90 days after to the Stated Maturity of the Notes for consideration other
than Qualified Equity Interests, or

 

(2)                                  convertible
at the option of the holder into Disqualified Equity Interests or exchangeable
for Debt prior to the date 90 days after the Stated Maturity of the Notes
(including, upon the occurrence of any contingency);

 

provided that Equity Interests will not
constitute Disqualified Equity Interests solely because of provisions giving
holders thereof the right to require repurchase or redemption upon an “asset
sale” or “change of control” occurring prior to the Stated Maturity of the Notes
if those provisions

 

(A)                              are
no more favorable to the holders thereof than those described in Sections 4.10,
4.11 and 4.12 and

 

11

 

(B)                                specifically
provide that repurchase or redemption pursuant thereto will not be required
prior to the Company’s repurchase of the Notes as required by this Indenture.

 

“Disqualified Stock” means
Capital Stock constituting Disqualified Equity Interests.

 

“Domestic Restricted Subsidiary”
means any Restricted Subsidiary of the Company formed under the laws of the
United States of America or any jurisdiction thereof.

 

“Domestic Subsidiary” means
any Subsidiary of the Company formed under the laws of the United States of
America or any jurisdiction thereof.

 

“DTC” means The Depository
Trust Company, a New York corporation, and its successors.

 

“DTC Legend” means the legend
set forth in Exhibit E.

 

“Encumbered Performance Obligation”
means any Performance Obligation (i) that is secured by any assets of the
Company or any Restricted Subsidiary (including Capital Stock of single-purpose
project Subsidiaries) other than the assets of the project Subsidiary to which
it relates (ii) that is secured by cash collateral including cash of a project
Subsidiary (but only to the extent of the cash actually collateralizing such
Performance Obligation), (iii) the terms of which limit the ability of the
account party of the Performance Obligation or any guarantor of the account
party’s obligations under the Performance Obligation other than the project
Subsidiary to which such Performance Obligation relates to pay dividends up to
the full amount of its statutory income in any fiscal year or make any other
similar distributions, (iv) the terms of which limit the ability of the party
described in clause (iii) to make loans or advances to the Company or any
Restricted Subsidiary, or (v) the terms of which impose a minimum cash-on-hand
requirement (but only to the extent of the cash actually required to be kept
on-hand) other than with respect to a project Subsidiary to which such
Performance Obligation relates; provided that in each case issued but
undrawn letters of credit issued under the Credit Agreement or any Credit
Facility shall not constitute “Encumbered Performance Obligations.”

 

“Equity Interests” means all
Capital Stock and all warrants or options with respect to, or other rights to
purchase, Capital Stock, but excluding Debt convertible into or exchangeable
for equity.

 

“Event of Default” has the
meaning assigned to such term in Section 6.01.

 

“Event of Loss” means, with
respect to any property or asset, (1) any loss, destruction or damage of such
property or asset or (2) any condemnation, seizure or taking, by exercise of
the power of eminent domain or otherwise, of such property or asset, or
confiscation or requisition of the use of such property or asset.

 

“Excepted Non-Guarantor Subsidiary”
means Foster Wheeler Caribe Corporation, C.A., Foster Wheeler Continental B.V,
Foster Wheeler Europe B.V, Foster Wheeler (Malaysia) Sdn. Bhd., Foster Wheeler
Petroleum Services S.A.E., Foster Wheeler Power Company Ltd./La Societe
D’Energie Foster Wheeler Ltee, F.W. Gestao E Servicos, S.A., FW Management

 

12

 

Operations, Ltd., FW
Overseas Operations Limited, Manops Limited, P.E. Consultants, Inc., Perryville
Service Company Ltd., Singleton Process Systems GmbH, until such Subsidiary
executes a Note Guarantee.

 

“Excess Proceeds” has the
meaning assigned to such term in Section 4.11.

 

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

 

“Exchange Notes” means the
Series A Notes issued pursuant to this Indenture in exchange for, and in an
aggregate principal amount equal to, the Series B Notes in compliance with the
terms of the Registration Rights Agreement or the Additional Registration
Rights Agreement (other than Private Exchange Notes) containing terms
substantially identical to the Series B Notes (except that (i) such Series A
Notes will be registered under the Securities Act and will not be subject to
transfer restrictions or bear the Restricted Legend and (ii) the provisions
relating to Additional Interest will be eliminated).

 

“Exchange Offer” means an
offer by the Company to the Holders of the Series B Notes to exchange
outstanding Notes for Exchange Notes, as provided for in the Registration
Rights Agreement.

 

“Exchange Offer Registration Statement”
means the Exchange Offer Registration Statement as defined in the Registration
Rights Agreement.

 

“Existing Letter of Credit Facility”
means the letter of credit facility available under the Credit Agreement.

 

“Fair Market Value” with
respect to any asset or property means the sale value that would be obtained in
an arm’s-length transaction between an informed and willing seller under no compulsion
to sell and an informed and willing buyer under no compulsion to buy. Fair
Market Value shall be determined by the Board of Directors of the Company
acting in good faith, which determination shall be conclusive for all purposes
of this Indenture; provided that, with respect to any
determination referred to in Section 4.12 the opinion referred to therein
shall be provided if required.

 

“Fitch” means Fitch IBCA Inc.
or any successor thereto.

 

“Fixed Charge Coverage Ratio”
means, on any date (the “transaction date”), the ratio of

 

(x)                                   the
aggregate amount of Consolidated Cash Flow for the four most recent full fiscal
quarters for which internal financial statements are available immediately
preceding the date of the transaction giving rise to the need to calculate the
Fixed Charge Coverage Ratio (the “reference period”) to

 

(y)                                 the
aggregate Fixed Charges during such reference period.

 

In making the foregoing
calculation,

 

13

 

(1)                                  pro
forma effect will be given to any Debt, Disqualified Stock or Preferred Stock
Incurred during or after the reference period to the extent the Debt is
outstanding or is to be Incurred on the transaction date as if the Debt,
Disqualified Stock or Preferred Stock had been Incurred on the first day of the
reference period;

 

(2)                                  pro
forma calculations of interest on Debt bearing a floating interest rate will be
made as if the rate in effect on the transaction date (taking into account any
Hedging Agreement applicable to the Debt if the Hedging Agreement has a
remaining term of at least 12 months) had been the applicable rate for the
entire reference period and fixed charges attributable to interest on Debt
under any revolving credit facility computed on a pro forma basis will be based
on the average daily balance of such Debt for the entire reference period;

 

(3)                                  Fixed
Charges related to any Debt, Disqualified Stock or Preferred Stock no longer
outstanding or to be repaid or redeemed on the transaction date, except for
Consolidated Interest Expense accrued during the reference period under a
revolving credit to the extent of the commitment thereunder (or under any
successor revolving credit) in effect on the transaction date, will be
excluded;

 

(4)                                  pro
forma effect will be given to

 

(A)                              the
creation, designation or redesignation of Restricted and Unrestricted
Subsidiaries,

 

(B)                                the
acquisition or disposition of companies, divisions or lines of businesses by
the Company and its Restricted Subsidiaries, including any acquisition or disposition
of a company, division or line of business since the beginning of the reference
period by a Person that became a Restricted Subsidiary after the beginning of
the reference period, and

 

(C)                                the
discontinuation of any discontinued operations but, in the case of Fixed
Charges, only to the extent that the obligations giving rise to the Fixed
Charges will not be obligations of the Company or any Restricted Subsidiary
following the transaction date

 

that have occurred since
the beginning of the reference period as if such events had occurred, and, in
the case of any disposition, the proceeds thereof applied, on the first day of
the reference period. To the extent that pro forma effect is to be given to an
acquisition or disposition of a company, division or line of business, the pro
forma calculation will be based upon the most recent four full fiscal quarters
for which the relevant financial information is available.

 

“Fixed Charges” means, for any
period, the sum of

 

(1)                                  Interest
Expense for such period;

 

(2)                                  all
fees and commissions paid in respect of Trade Obligations and Performance
Obligations; and

 

14

 

(3)                                  all
cash dividends paid on any Disqualified Stock or Preferred Stock of the Company
or a Restricted Subsidiary, except for dividends payable in the Company’s
Qualified Stock or paid to the Company or to a Restricted Subsidiary (divided
by, to the extent such dividends are not deductible for income tax purposes, an
amount equal to one minus the effective tax rate of the Company and its
Subsidiaries; provided that if the effective tax rate for such period is
negative, the adjustment described in this parenthetical shall not apply).

 

“Foothill Facility” means the
Loan and Security Agreement by and among Foster Wheeler Funding II LLC as
Borrower, the Lenders that are Signatories thereto and Wells Fargo Foothill
Inc. as the Arranger and Administrative Agent, dated July 31, 2003.

 

“Foreign Restricted Subsidiary”
means any Restricted Subsidiary that is not a Domestic Restricted Subsidiary.

 

“Form S-4” means the
Registration Statement on Form S-4 (Registration No. 333-107054) of the Company
and Parent and certain of their subsidiaries, including the documents
incorporated by reference therein, as declared effective with the Commission on
[            ], 2004.

 

“GAAP” means generally
accepted accounting principles in the United States of America as in effect
from time to time.

 

“Global Note” means a Note in
registered global form without interest coupons.

 

“Guarantee” means any
obligation, contingent or otherwise, of any Person directly or indirectly
guaranteeing any Debt or other obligation of any other Person and, without
limiting the generality of the foregoing, any obligation, direct or indirect,
contingent or otherwise, of such Person (i) to purchase or pay (or advance or
supply funds for the purchase or payment of) such Debt or other obligation of
such other Person or (ii) entered into for purposes of assuring in any other
manner the obligee of such Debt or other obligation of the payment thereof or
to protect such obligee against loss in respect thereof, in whole or in part; provided
that the term “Guarantee” does not include endorsements for collection or
deposit in the ordinary course of business. The term “Guarantee” used as a verb
has a corresponding meaning.

 

“Guarantor” means (i) Parent
and Foster Wheeler Holdings, Ltd.; (ii) the Subsidiaries listed on the
signature pages to this Indenture; and (iii) each Restricted Subsidiary that
executes a supplemental indenture in the form of Exhibit C to this Indenture
providing for the guarantee of the payment of the Notes, in each case unless
and until such Guarantor is released from its Note Guarantee pursuant to this
Indenture.

 

“Hedging Agreement” means (i)
any interest rate swap agreement, interest rate cap agreement or other
agreement designed to protect against fluctuations in interest rates, (ii) any
foreign exchange forward contract, currency swap agreement or other agreement
designed to protect against fluctuations in foreign exchange rates or (iii) any
commodity or raw material futures contract or any other agreement designed to
protect against fluctuations in raw material prices; provided that in each case
such agreement or contract is intended in good faith by the Company or the
respective Restricted Subsidiary party thereto to protect against interest,
foreign

 

15

 

exchange or commodity
risks to which the Company or such Restricted Subsidiary, as applicable, anticipates
being subject.

 

“Holder” or “Noteholder”
means the registered holder of any Note.

 

“Incur” means, with respect to
any Debt or Capital Stock, to incur, create, issue, assume or Guarantee such
Debt or Capital Stock. If any Person becomes a Restricted Subsidiary on any
date after the date of this Indenture (including by redesignation of an
Unrestricted Subsidiary or failure of an Unrestricted Subsidiary to meet the
qualifications necessary to remain an Unrestricted Subsidiary), the Debt and
Capital Stock of such Person outstanding on such date will be deemed to have
been Incurred by such Person on such date for purposes of Section 4.05,
but will not be considered the sale or issuance of Equity Interests for
purposes of Section 4.11.  The
accretion of original issue discount or payment of interest in kind will not be
considered an Incurrence of Debt.  The
reclassification of an existing operating lease as a Capital Lease in a
Person’s financial statements as a result of a change in accounting principles
shall not constitute and “Incurrence” of such Capital Lease on such
reclassification date.

 

“Indenture” means this
Indenture, as amended or supplemented from time to time pursuant to the
provisions hereof.

 

“Initial Series A Notes” means
the Series A Notes issued on the Issue Date and on the date of closing of a
subsequent offering period, if any, as described in the Form S-4, and any Notes
issued in replacement thereof.

 

“Initial Series B Notes” means
the Series B Notes issued on the Issue Date and any Notes issued in replacement
thereof, but not including any Exchange Notes issued in exchange therefor.

 

“Institutional Accredited Investor
Certificate” means a certificate substantially in the form of
Exhibit H hereto.

 

“interest”, in respect of the
Notes, unless the context otherwise requires, refers to interest and Additional
Interest, if any.

 

“Intercompany Cash Management Agreement”
means the Intercompany Cash Management Agreement among Foster Wheeler Inc. and
certain Subsidiaries of the Company dated as of January 1, 2004, as in
effect on the Issue Date.

 

“Intercompany Note” means a
promissory note evidencing debt owed by an Obligor or Restricted Subsidiary to
an Affiliate of such Obligor or Restricted Subsidiary.

 

“Intercreditor Agreement”
means the Intercreditor Agreement dated the Issue Date between Bank of America,
N.A., in its capacities as Administrative Agent and Collateral Agent under the
Credit Agreement, and the Trustee.

 

“Interest Expense” means, for
any period, the consolidated interest expense of the Company and its Restricted
Subsidiaries, excluding fees related to the issuance and registration of the
Notes, plus, to the extent not included in such consolidated interest expense,
and to the

 

16

 

extent Incurred, accrued
or payable by the Company or its Restricted Subsidiaries, without duplication,
(i) interest expense attributable to Sale and Leaseback Transactions, (ii)
amortization of debt discount and debt issuance costs but excluding amortization
of deferred financing charges incurred in respect of the Notes and the Credit
Facilities on or prior to the Issue Date, (iii) capitalized interest, including
the interest component of any Capital Leases, (iv) non-cash interest expense,
(v) commissions, discounts and other fees and charges owed with respect to
letters of credit and bankers’ acceptance financing (other than in respect of
Contract Performance Arrangements), (vi) net costs associated with Hedging
Agreements (including the amortization of fees), (vii) any interest expense on
Debt of another Person that is Guaranteed by the Company or any Restricted
Subsidiary or secured by a Lien on assets of the Company or its Restricted
Subsidiaries, if and to the extent such interest is actually paid by the
Company or any Restricted Subsidiary, and (viii) any of the above expenses with
respect to Debt of another Person Guaranteed by the Company or any of its
Restricted Subsidiaries, but only to the extent such expenses are actually paid
by the Company or a Restricted Subsidiary during such period.

 

“Interest Payment Date” means
each [            ]
and [            ]
of each year, commencing
[            ],
2004.

 

“Investment” means

 

(1)                                  any
direct or indirect advance, loan or other extension of credit to another
Person,

 

(2)                                  any
capital contribution to another Person, by means of any transfer of cash or
other property or in any other form,

 

(3)                                  any
purchase or acquisition of Equity Interests, bonds, notes or other Debt, or
other instruments or securities issued by another Person, including the receipt
of any of the above as consideration for the disposition of assets or rendering
of services together with all other items, if any, that are, or would be,
classified as Investments on a balance sheet prepared in accordance with GAAP,
or

 

(4)                                  any
Guarantee of any obligation of another Person, but only when payment has been
made thereunder or such arrangements would be classified and accounted for as a
liability on the balance sheet of the guarantor.

 

If the Company or any
Restricted Subsidiary (x) sells or otherwise disposes of any Equity Interests
of any direct or indirect Restricted Subsidiary so that, after giving effect to
that sale or disposition, such Person is no longer a Subsidiary of the Company,
or (y) designates any Restricted Subsidiary as an Unrestricted Subsidiary in
accordance with the provisions of this Indenture, the Company or the applicable
Restricted Subsidiary, as the case may be, shall be deemed to have made an
Investment in such Person at such time in an amount equal to the Fair Market
Value of the remaining Equity Interests in such Person held by the Company or
such Restricted Subsidiary.

 

“Investment Grade Rating”
means, with respect to any holder of Equity Interests in any Joint Venture,
that either (i) such holder has a rating from Standard and Poor’s, Moody’s or
Fitch of BBB-, Baa3 or BBB-, respectively or better or (ii) if such holder is
not rated by any of such

 

17

 

rating agencies, the Board
of Directors of Parent has determined in good faith that such holder would have
a rating equivalent to such minimum ratings were it to seek a rating from such
agencies.

 

“Issue Date” means
[                         ], 2004.

 

“Joint Venture” means any Person
that is not a Subsidiary of the Company (i) in which the Company or any
Restricted Subsidiary, directly or indirectly, owns at least 20% or more of the
Equity Interests of such Person, and (ii) as to which the Company or such
Restricted Subsidiary, as the case may be, has either (a) the power to control,
directly or indirectly (whether through the exercise of voting rights,
representation on the board of directors or other governing body of such
Person, the exercise of veto rights or otherwise), any decisions by such Person
with respect to the payment of dividends or the making of distributions by such
Person or (b) the right (by contract, applicable law or otherwise) to cause the
dissolution and liquidation of such Person (including pursuant to contractual
provisions governing deadlock that may require good faith efforts to resolve
any deadlock prior to any such dissolution or liquidation).

 

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

 

“Moody’s” means Moody’s
Investors Service, Inc. and its successors.

 

“Net Cash Proceeds” means,
with respect to any Asset Sale or Event of Loss, the proceeds of such Asset
Sale or Event of Loss in the form of cash or Cash Equivalents (including (i)
payments in respect of deferred payment obligations, when received in the form
of cash or Cash Equivalents, and (ii) proceeds from the conversion of other
consideration received when converted to cash or Cash Equivalents), net of

 

(1)                                  brokerage
commissions and other fees and expenses related to such Asset Sale or Event of
Loss, including fees and expenses of counsel, accountants and investment
bankers;

 

(2)                                  relocation
expenses resulting from such Asset Sale or Event of Loss;

 

(3)                                  provisions
for taxes payable as a result of such Asset Sale or Event of Loss;

 

(4)                                  payments
required to be made to holders of minority interests in Restricted Subsidiaries
as a result of such Asset Sale or Event of Loss or to repay Debt outstanding at
the time of such Asset Sale or Event of Loss that is secured by a Lien on the
property or assets sold; and

 

(5)                                  appropriate
amounts to be provided as a reserve against liabilities associated with such
Asset Sale or Event of Loss in accordance with GAAP, including pension and
other post-employment benefit liabilities, liabilities related to environmental
matters and indemnification obligations associated with such Asset Sale, with
any

 

18

 

subsequent
reduction of the reserve other than by payments made and charged against the
reserved amount to be deemed a receipt of cash.

 

“New Indenture Documents”
shall have the meaning set forth in the Intercreditor Agreement.

 

“Non-Recourse Debt” means Debt
as to which (1) neither the Company nor any Restricted Subsidiary provides any
Guarantee, (2) no default with respect to which (including the rights that
holders of the Debt may have to take enforcement action against an Unrestricted
Subsidiary) would permit upon notice, lapse of time or both any holder of any
other Debt (other than the Notes) of the Company or any Restricted Subsidiary
to declare a default on such other Debt or cause the payment of the Debt to be
accelerated or payable prior to its stated maturity and (3) the holders of such
Debt have no recourse to the stock or assets of the Company or any of its
Restricted Subsidiaries; provided that a pledge by a Restricted
Subsidiary of the stock held by it of any Unrestricted Subsidiary to secure
such Unrestricted Subsidiary’s Debt shall be permitted under this clause (3)
and shall not prevent such Debt from being Non-Recourse Debt hereunder.

 

“Non-U.S. Person” means a
Person that is not a U.S. person, as defined in Regulation S.

 

“Non-Wholly Owned Subsidiary”
means, with respect to any Person, any Subsidiary that is not Wholly-Owned.

 

“Notes” has the meaning
assigned to such term in the Recitals.

 

“Notes Collateral Agent” means
the Trustee or any replacement of the Trustee appointed in accordance with this
Indenture and Collateral Documents in its capacity as collateral agent or
mortgagee (as applicable) under the Collateral Documents.

 

“Note Guarantee” means the
guarantee of the Notes by a Guarantor pursuant to this Indenture.

 

“Obligations” means, with
respect to any Debt, all obligations (whether in existence on the Issue Date or
arising afterwards, absolute or contingent, direct or indirect) for or in
respect of principal (when due, upon acceleration, upon redemption, upon
mandatory repayment or repurchase pursuant to a mandatory offer to purchase, or
otherwise), premium, interest, penalties, fees, indemnification, reimbursement
and other amounts payable and liabilities with respect to such Debt, including
all interest accrued or accruing after the commencement of any bankruptcy,
insolvency or reorganization or similar case or proceeding at the contract rate
(including, without limitation, any contract rate applicable upon default)
specified in the relevant documentation, whether or not the claim for such
interest is allowed as a claim in such case or proceeding.

 

“Obligor” means the Company,
each Parent Guarantor and any Restricted Subsidiary that is a Guarantor.

 

“Offer to Purchase” has the
meaning assigned to such term in Section 3.04.

 

19

 

“Officer” means the chairman
of the Board of Directors, the president or chief executive officer, any vice
president, the chief financial officer, the treasurer or any assistant
treasurer, or the secretary or any assistant secretary, of any Person.

 

“Officers’ Certificate” means
a certificate signed in the name of any Person (i) by the chairman of the Board
of Directors, the president or chief executive officer or a vice president of
such Person and (ii) by the chief financial officer, the treasurer or any
assistant treasurer or the secretary or any assistant secretary of such Person.

 

“Offshore Global Note” means a
Global Note representing Series B Notes issued and sold pursuant to Regulation
S.

 

“Opinion of Counsel” means a
written opinion signed by legal counsel, who may be an employee of or counsel
to the Company.

 

“Parent” means Foster Wheeler
Ltd., a company organized under the laws of Bermuda.

 

“Parent Guarantors” means
Parent and Foster Wheeler Holdings Ltd., for so long as Foster Wheeler Holdings
Ltd. is a subsidiary of Parent and owns 100% of the Company.

 

“Paying Agent” refers to a
Person, appointed by the Company pursuant to Section 2.03(a), engaged to
perform the obligations of the Trustee in respect of payments made or funds
held hereunder in respect of the Notes.

 

“Performance Obligations”
means, as to any Person, all obligations in respect of letters of credit, bank
guarantees, bankers’ acceptances, surety bonds, performance bonds and other
similar instruments issued for the account of such Person in the ordinary
course of business of such Person that support obligations (other than Debt) in
respect of engineering, procurement, construction, manufacturing, equipment or
supply projects of the Company or its Restricted Subsidiaries and shall include
Contract Performance Arrangements.

 

“Permanent Offshore Global Note”
means an Offshore Global Note that does not bear the Temporary Offshore Global
Note Legend.

 

“Permitted Debt” has the
meaning assigned to such term in Section 4.05(b).

 

“Permitted Investments” means:

 

(1)                                  Investments
existing on March 26, 2004;

 

(2)                                  any
Investment in the Company (including any Investment in the Notes) or in a
Restricted Subsidiary of the Company that is also a Guarantor;

 

(3)                                  any
Investment in Cash Equivalents;

 

(4)                                  any
Investment by the Company or any Restricted Subsidiary of the Company in a
Person, if as a result of such Investment,

 

20

 

(A)                              such
Person becomes a Restricted Subsidiary of the Company that is also a Guarantor,
or

 

(B)                                such
Person is merged or consolidated with or into, or transfers or conveys
substantially all its assets to, or is liquidated into, the Company or a
Restricted Subsidiary that is also a Guarantor;

 

(5)                                  Investments
received as non-cash consideration in an Asset Sale made pursuant to and in
compliance with the provisions of Section 4.11;

 

(6)                                  Investments
in Restricted Subsidiaries that are not Guarantors in an aggregate amount,
taken together with all other Investments made in reliance on this clause, not
to exceed $10,000,000 (net of, with respect to the Investment in any particular
Person, the cash return thereon received after March 26, 2004 as a result
of any sale for cash, repayment, redemption, liquidity distribution or other
cash realization); provided that no more than $2,000,000 of such Investments
may be made in Excepted Non-Guarantor Subsidiaries;

 

(7)                                  Hedging
Agreements otherwise permitted under this Indenture;

 

(8)                                  (i)
receivables owing to the Company or any Restricted Subsidiary, and contracts in
progress of the Company or any Restricted Subsidiary, in either case if created
or acquired in the ordinary course of business, (ii) prepaid expenses and
deposits created or made in the ordinary course of business, (iii) Cash
Equivalents or other cash management investments or liquid or portfolio
securities pledged as collateral pursuant to the provisions of
Section 4.07, and (iv) endorsements for collection or deposit in the
ordinary course of business;

 

(9)                                  extensions
of credit to customers and suppliers in the ordinary course of business;

 

(10)                            Investments
in Joint Ventures in an aggregate amount, taken together with all other
Investments made in reliance on this clause since March 26, 2004, not to
exceed 8.5% of the Consolidated Tangible Assets (net of, with respect to the
Investment in any particular Person, the cash return thereon received after
March 26, 2004 as a result of any sale for cash, repayment, redemption,
liquidating distribution or other cash realization to the extent such cash
return has not been included in clause (a)(3)(D) of Section 4.06);

 

(11)                            reasonable
payroll, travel and other loans or advances to, or Guarantees issued to support
the obligations of, officers and employees, in each case in the ordinary course
of business:

 

(12)                            Investments
in evidences of indebtedness, securities or other property received from
another Person by the Company or any Restricted Subsidiary in connection with
any bankruptcy proceeding or by reason of a composition or readjustment of Debt
or a reorganization of such Person or as a result of foreclosure, perfection or
enforcement of any Lien in exchange for evidences of indebtedness, securities
or other property of such Person held by the Company or any Restricted
Subsidiary, or for other liabilities or

 

21

 

obligations of
such other Person to the Company or any Restricted Subsidiary that were created
in accordance with the terms of this Indenture or received in compromise or
settlement of Debts created in the ordinary course of business;

 

(13)                            so
long as no Default has occurred and is continuing, the repurchase or redemption
of all of the Equity Interests of Martinez Cogen Limited Partnership not owned
by the Company on the Issue Date in accordance with the terms of the
partnership agreement as in effect on the Issue Date; provided that the Fixed Charge
Coverage Ratio immediately after giving effect to such repurchase or redemption
exceeds the Fixed Charge Coverage Ratio immediately prior to such repurchase or
redemption;

 

(14)                            any
Guarantee of the Debt of any Person, so long as such Guarantee is permitted by
Section 4.05;

 

(15)                            Investments
in a Securitization Subsidiary, that are necessary or desirable to effect any
Permitted Receivables Financing;

 

(16)                            any
Investment by a Restricted Subsidiary that is not a Guarantor in any other
Restricted Subsidiary that is not a Guarantor;

 

(17)                            with
respect to any construction, engineering of procurement project, deposits or
other arrangements for restricted cash accounts made or created in connection
with (i) advances or prepayments by customers under contracts entered into in
or during the ordinary course of business or (ii) Contract Performance
Arrangements, in each case with any bank or trust company described in clause
(3) of the definition of “Cash Equivalents” or, with respect to deposits or
arrangements made by Foreign Restricted Subsidiaries, determined by the Company
in good faith to be of acceptable credit quality for such purpose, in each case
made in the ordinary course of business; and

 

(18)                            any
Investment in Capital Stock of a Joint Venture organized under the laws of
South Africa received as consideration for a sale of the type described in
clause (12) of the definition of Asset Sale above.

 

“Permitted Liens” means

 

(1)                                  Liens
existing on March 26, 2004;

 

(2)                                  Liens
in favor of the Company or any Restricted Subsidiary;

 

(3)                                  Liens
created by this Indenture and the Collateral Documents securing the Notes or
any Note Guarantees;

 

(4)                                  Liens
on assets or properties, securing Obligations under or with respect to the
Credit Facilities and Hedging Agreements entered into with respect to Debt
under the Credit Facilities and Incurred pursuant to Section 4.05(b)(1)
and (b)(6);

 

(5)                                  pledges
or deposits under worker’s compensation laws, unemployment insurance laws or
similar legislation, or good faith deposits in connection with bids,

 

22

 

tenders, contracts
or leases, or to secure public or statutory obligations, surety bonds, customs
duties and the like, or for the payment of rent, in each case incurred in the
ordinary course of business and not securing Debt;

 

(6)                                  Liens
imposed by law, such as landlords’, carriers’, vendors’, warehousemen’s and
mechanics’ liens, in each case for sums not yet due or being contested in good
faith and by appropriate proceedings;

 

(7)                                  Liens
in respect of taxes and other governmental assessments and charges which are
not yet due or which are being contested in good faith and by appropriate
proceedings promptly instituted and diligently pursued; provided that any
reserve or other appropriate provision as shall be required in accordance with
GAAP shall have been made therefor;

 

(8)                                  Liens
securing Trade Obligations that encumber the documents and other property the
purchase of which is supported by such Trade Obligations and the proceeds thereof;

 

(9)                                  survey
exceptions, encumbrances, easements or reservations of, or rights of others
for, licenses, rights of way, sewers, electric lines, telegraph and telephone
lines and other similar purposes, or zoning or other restrictions as to the use
of real property, not interfering in any material respect with the conduct of
the business of the Company and its Restricted Subsidiaries;

 

(10)                            Liens
arising in the ordinary course of business securing advances, or progress or
partial payments, by a customer of the Company or any Restricted Subsidiary
encumbering assets purchased or built pursuant to any engineering,
construction, procurement, manufacturing, equipment or supply contract with
such customer;

 

(11)                            licenses
or leases or subleases as licensor, lessor or sublessor of any of its property,
including intellectual property, in the ordinary course of business;

 

(12)                            customary
Liens in favor of trustees and escrow agents, and netting and setoff rights,
banker’s liens and the like in favor of financial institutions and
counterparties to financial obligations and instruments, excluding Hedging
Agreements, in each case, arising in the ordinary course of business;

 

(13)                            restrictions
on the transfer of assets to be sold pursuant to merger agreements, stock or
asset purchase agreements and similar agreements so long as such transfer is
otherwise permitted under this Indenture and such restriction is imposed only
during the period pending such disposition (so long as such restrictions do not
continue for more than a customary period for transactions of such type);

 

(14)                            options,
put and call arrangements, rights of first refusal and similar rights relating
to Investments in Joint Ventures, partnerships and the like that are not
Subsidiaries;

 

23

 

(15)                            judgment
liens, and Liens securing appeal bonds or letters of credit issued in support
of or in lieu of appeal bonds, so long as (i) no Event of Default then exists
under paragraph six of Section 6.01 and (ii) the Company or the respective
Restricted Subsidiary is contesting such judgment in good faith and is
maintaining adequate services in accordance with GAAP;

 

(16)                            Liens
upon the property or assets of any Restricted Subsidiary (other than a
Guarantor) securing Performance Obligations otherwise permitted under
Section 4.05(b)(14) and/or (b)(15);

 

(17)                            Liens
(including the interest of a lessor under a Capital Lease, but excluding any
Liens arising pursuant to a Sale and Leaseback Transaction) on property that
secures Debt Incurred for the purpose of financing all or any part of the
purchase price or cost of engineering of, procurement for, or construction or
improvement of such property and which attach within 365 days after the date of
such purchase or the completion of construction or improvement to the extent
such Debt is Incurred under Section 4.05(b)(7);

 

(18)                            Liens
on property of a Person at the time such Person becomes a Restricted Subsidiary
of the Company, provided such Liens were not created in contemplation thereof
and do not extend to any other property of the Company or any Restricted
Subsidiary;

 

(19)                            Liens
on property at the time the Company or any of the Restricted Subsidiaries
acquires such property, including any acquisition by means of a merger or
consolidation with or into the Company or a Restricted Subsidiary of such
Person, provided
such Liens were not created in contemplation thereof and do not extend to any
other property of the Company or any Restricted Subsidiary;

 

(20)                            Liens
securing Hedging Agreements so long as such Hedging Agreements relate to Debt
that is, and is permitted to be under this Indenture, secured by a Lien on the
same property securing such Hedging Agreements;

 

(21)                            any
pledge of the Capital Stock of an Unrestricted Subsidiary, Non-Wholly Owned
Subsidiary or Joint Venture to secure Debt of such Unrestricted Subsidiary,
Non-Wholly Owned Subsidiary or Joint Venture, to the extent such pledge
constitutes an Investment permitted under Section 4.06;

 

(22)                            extensions,
renewals or replacements of any Liens referred to in clauses (1), (2), (16),
(17), (18) or (19) in connection with the refinancing of the obligations
secured thereby, provided that such Lien does not extend to any other property
and, except as contemplated by the definition of “Permitted Refinancing Debt”,
the amount secured by such Lien is not increased;

 

(23)                            Liens
with respect to Joint Ventures or Non-Wholly Owned Subsidiaries or other
similar arrangements to secure the obligations of one joint venture party to
another, provided
that such Liens do not secure Debt;

 

24

 

(24)                            Liens
on accounts receivable and related assets and proceeds thereof arising in
connection with a Permitted Receivables Financing;

 

(25)                            Liens
resulting from the deposit of funds or evidences of Debt in trust for the
purpose of defeasing Debt of the Company or any Restricted Subsidiary, which
defeasance is otherwise permitted under this Indenture;

 

(26)                            Liens
securing Debt of any Foreign Restricted Subsidiary or Martinez Cogen Limited
Partnership otherwise permitted to be incurred under this Indenture; and

 

(27)                            other
Liens (including any Liens arising in connection with any Sale and Leaseback
Transaction) not permitted by the foregoing securing obligations in an
aggregate amount not exceeding $10,000,000 at any time outstanding.

 

For purposes hereof, any
Liens Incurred by the Company or any of its Restricted Subsidiaries subsequent
to March 26, 2004 shall be deemed to have been Incurred on the Issue Date
(and, to the extent that such Liens would not have been permitted to have been
Incurred at such time, the Company shall be deemed to be in breach of
Section 4.07).

 

“Permitted Receivables Financing”
means any receivables financing facility or arrangement pursuant to which a
Securitization Subsidiary purchases or otherwise acquires accounts receivable
of the Company or any Restricted Subsidiaries and enters into a third party
financing thereof on terms that the Board of Directors has concluded are
customary and market terms fair to the Company and its Restricted Subsidiaries.

 

“Permitted Refinancing Debt”
has the meaning set forth in Section 4.05(b)(5) of this Indenture.

 

“Permitted Senior Liens” means
Permitted Liens other than Liens of the type referred to in clauses (2), (3),
(15), (16), (21) or (22) of the definition of “Permitted Liens” in this
Section 1.01.

 

“Person” means an individual,
a corporation, a partnership, a limited liability company, an association, a
trust or any other entity, including a government or political subdivision or
an agency or instrumentality thereof.

 

“Post-Petition Interest” means
any interest that accrues after the commencement of any case, proceeding or
other action relating to the bankruptcy, insolvency or reorganization of the
Company or any Guarantor (or would accrue but for the operation of applicable
bankruptcy or insolvency laws), whether or not such interest is allowed or
allowable as a claim in any such proceeding.

 

“Preferred Stock” means, with
respect to any Person, any and all Capital Stock which is preferred as to the
payment of dividends or distributions, upon liquidation or otherwise, over
another class of Capital Stock of such Person.

 

“principal” of any Debt means
the principal amount of such Debt (or if such Debt was issued with original
issue discount, the face amount of such Debt less the remaining unamortized

 

25

 

portion of the original
issue discount of such Debt), together with, unless the context otherwise
indicates, any premium then payable on such Debt.

 

“Private Exchange” has the
meaning set forth in Section 2.02(e).

 

“Private Exchange Note” has
the meaning set forth in Section 2.02(e).

 

“Purchaser” means the
purchaser party to a purchase agreement with the Company relating to the sale
of the Series B Notes by the Company.

 

 “Qualified Equity Interests” means all
Equity Interests of a Person other than Disqualified Equity Interests.

 

“Qualified Stock” means all
Capital Stock of a Person other than Disqualified Stock.

 

“Qualified Term Loans” means
term loans incurred under a Credit Facility (i) the proceeds of which are
applied to the redemption of all or a portion of the principal of the Notes and
(ii) that have a Stated Maturity no earlier than the Notes, and the Average
Life of which is at least equal to the remaining Average Life of the Notes.

 

“refinance” has the meaning
assigned to such term in Section 4.05(b)(5).

 

“Register” has the meaning
assigned to such term in Section 2.09(a).

 

“Registrar” means a Person,
appointed by the Company pursuant to Section 2.03(a), engaged to maintain
the Register.

 

“Registration Rights Agreement”
means the Registration Rights Agreement dated on or about the Issue Date
between the Company and the Purchasers with respect to the Series B Notes.

 

“Regular Record Date” means,
for the interest payable on any Interest Payment Date, the
[                        ]
or [                      ]
(whether or not a Business Day) next preceding such Interest Payment Date.

 

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

 

“Regulation S Certificate”
means a certificate substantially in the form of Exhibit F hereto.

 

“Restricted Legend” means the
legend set forth in Exhibit D.

 

“Restricted Payment” has the
meaning assigned to such term in Section 4.06(a).

 

“Restricted Period” means the
relevant 40-day distribution compliance period as defined in Regulation S.

 

“Restricted Subsidiary” means
any Subsidiary of the Company other than an Unrestricted Subsidiary.

 

26

 

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

 

“Rule 144A Certificate” means
a certificate substantially in the form of Exhibit G hereto.

 

“S&P” means Standard &
Poor’s Ratings Group, a division of McGraw Hill, Inc. and its successors.

 

“Sale and Leaseback Transaction”
means, with respect to any Person, an arrangement whereby such Person enters
into a Capital Lease of property sold by such Person to the lessor in
contemplation of such lease (other than a lease entered into solely for the
purpose of permitting such Person to complete its commitments under any
contractual arrangement with a customer of such Person in existence at the time
of the sale to the lessor).

 

 “Secured Obligations” means all
indebtedness, obligations and liabilities of the Company and the Guarantors to
the Holders from time to time arising under or in connection with or related to
(including under any guarantee of) or evidenced by the Notes, the Note
Guarantees or this Indenture, and all extensions or renewals thereof, whether
such indebtedness, obligations or liabilities are direct or indirect, otherwise
secured or unsecured, joint or several, absolute or contingent, due or to
become due, whether for payment or performance, now, existing or hereafter arising.  Without limitation of the foregoing, such
indebtedness, obligations and liabilities include the principal amount of the
Notes, premium, interest (including Post-Petition Interest), fees, indemnities
or expenses under or in connection with (including all guaranties of) the
Notes, the Note Guarantees or this Indenture, and all extensions and renewals
thereof, whether or not such indebtedness, obligations or liabilities were made
in compliance with the terms and conditions of this Indenture or in excess of
the obligation of the Holders to lend. 
Secured Obligations shall remain Secured Obligations notwithstanding any
assignment or transfer or any subsequent assignment or transfer of any of the
Secured Obligations or any interest therein.

 

“Secured Party” means the
Trustee, each Holder, the beneficiaries of each indemnification obligation
undertaken by the Company or any Guarantor hereunder or under any Collateral
Document and the successors and assigns of each of the foregoing.

 

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

 

“Securitization Subsidiary”
means a Subsidiary of the Company:

 

(1)                                  that
is designated a “Securitization Subsidiary” by the board of directors,

 

(2)                                  that
does not engage in, and whose charter prohibits it from engaging in, any
activities other than Permitted Receivables Financings and any activity
necessary, incidental or related thereto,

 

(3)                                  no
portion of the Debt or any other obligation, contingent or otherwise, of which

 

27

 

(A)                              is
Guaranteed by the Company or any Restricted Subsidiary of Foster Wheeler, LLC,

 

(B)                                is
recourse to or obligates the Company or any Restricted Subsidiary of the
Company in any way, or

 

(C)                                subjects
any property or asset of the Company or any Restricted Subsidiary of the
Company, directly or indirectly, contingently or otherwise, to the satisfaction
thereof,

 

(4)                                  with
respect to which neither the Company nor any Restricted Subsidiary of the
Company (other than an Unrestricted Subsidiary) has any obligation to maintain
or preserve its financial condition or cause it to achieve certain levels of
operating results other than, in respect of clauses (3) and (4), pursuant to
customary representations, warranties, covenants and indemnities entered into in
connection with a Permitted Receivables Financing.

 

“Security Agreement” means the
Security Agreement dated as of the Issue Date by the Company and the Guarantors
to the Trustee.

 

“Senior Debt” means, on any
date, collectively (i) all Debt outstanding under Credit Facilities incurred
pursuant to Section 4.05(b)(1) but excluding any issued but undrawn
letters of credit issued under the Credit Agreement or any other Credit
Facility, (ii) any outstanding Notes, the Company’s 6.75% Senior Notes due 2005
or any other Debt Incurred after the issue date that ranks pari passu with the Notes,
(iii) any Debt (other than Trade Obligations) that is entitled to the benefits
of any Lien upon any property of the Company or any Restricted Subsidiary, (iv)
any Debt, other than Debt that is expressly subordinated to the Notes, in
respect of which any Restricted Subsidiary that is not a Guarantor is directly
or indirectly obligated and (v) any Encumbered Performance Obligations.

 

“Senior Debt to Consolidated Cash Flow
Ratio” means, on any date, the ratio of (a) the sum of all Senior
Debt on such date to (b) the aggregate amount of Consolidated Cash Flow for the
four most recent full fiscal quarters for which internal financial statements
are available immediately preceding the date of the transaction giving rise to
the need to calculate the ratio.

 

“Shelf Registration Statement”
means the Shelf Registration Statement as defined in the Registration Rights
Agreement.

 

“Significant Restricted Subsidiary”
means any Restricted Subsidiary that would be a “significant subsidiary” as
defined in Article 1, Rule 1-02 of Regulation S-X promulgated under the
Securities Act, as such regulation is in effect on the Issue Date.

 

“Stated Maturity” means (i)
with respect to any Debt, the date specified as the fixed date on which the
final installment of principal of such Debt is due and payable, (ii) with
respect to any scheduled installment of principal of or interest on any Debt,
the date specified as the fixed date on which such installment is due and
payable as set forth in the documentation governing such Debt, not including
any contingent obligation to repay, redeem or repurchase

 

28

 

prior to the regularly
scheduled date for payment or (iii) with respect to any Debt payable “on
demand”, the date on which such demand is made or exercised in accordance with
its terms.

 

“Subordinated Debt” means any
Debt of the Company or any Guarantor which is subordinated in right of payment
to the Notes or the Note Guarantee, as applicable, pursuant to a written
agreement to that effect.

 

“Subsidiary” means with
respect to any Person, any corporation, association or other business entity of
which more than 50% of the outstanding Voting Stock is owned, directly or
indirectly, by, or, in the case of a partnership, the sole general partner or
the managing partner or the only general partners of which are, such Person and
one or more Subsidiaries of such Person (or a combination thereof). Unless
otherwise specified, “Subsidiary” means a Subsidiary of the Company.

 

“Subsidiary Guarantor” means a
Guarantor that is a Subsidiary of the Company.

 

“Temporary Offshore Global Note”
means an Offshore Global Note that bears the Temporary Offshore Global Note
Legend.

 

“Temporary Offshore Global Note Legend”
means the legend set forth in Exhibit L.

 

“Trade Obligations” means all
letters of credit, bank guarantees, bankers’ acceptances or other similar
instruments issued in respect of trade payables or similar obligations but in any
event excluding Performance Obligations.

 

“Trustee” means the party
named as such in the first paragraph of this Indenture or any successor trustee
under this Indenture pursuant to Article 7.

 

“Trust Indenture Act” or “TIA”
means the Trust Indenture Act of 1939.

 

“U.K. Credit Facility” means
the Financing Agreement dated as of January 26, 2004, by and among Foster
Wheeler Limited, Foster Wheeler Energy Limited, Process Industries Agency
Limited, Foster Wheeler South Africa (Pty) Limited, Foster Wheeler Properties
(Pty) Limited, the guarantors signatory thereto, the lenders signatory thereto
and Saberasu Japan Investments II B.V as Collateral Agent and as Administrative
Agent, as amended from time to time.

 

“U.S. Global Note” means a
Global Note that bears the Restricted Legend representing Series B Notes issued
and sold pursuant to Rule 144A, or Private Exchange Notes.

 

“U.S. Government Obligations”
means obligations issued or directly and fully guaranteed or insured by the
United States of America or by any agency or instrumentality thereof, provided that
the full faith and credit of the United States of America is pledged in support
thereof.

 

“Unrestricted Subsidiary”
means (1) any Securitization Subsidiary or (2) any Subsidiary of the Company
that at the time of determination has previously been designated, and continues
to be, an Unrestricted Subsidiary in accordance with Section 4.14.  As of the Issue Date the following
Subsidiaries will be designated as Unrestricted Subsidiaries: 4900 Singleton

 

29

 

L.P.; 8925 Rehco, Inc.;
Adirondack Resource Recovery Associates, L.P.; Barsotti’s Inc.; BOC/FW Canoas
Hidrogenio Ltda.; Chirliu, Inc.; Foster Wheeler Adibi Engineering; Foster
Wheeler Adirondack, Inc.; Foster Wheeler America Latina, Ltda.; Foster Wheeler
Andina S.A.; Foster Wheeler Architectural Services Corporation; Foster Wheeler
Australia Proprietary Limited; Foster Wheeler Bridgewater, Inc.; Foster Wheeler
Canadian Resources, Ltd.; Foster Wheeler Canoas Inc.; Foster Wheeler China,
Inc.; Foster Wheeler Constructors de Mexico S. de R.I. de C.V.; Foster Wheeler
Energy China, Inc.; Foster Wheeler Energy India, Inc.; Foster Wheeler
Environmental Services, Inc.; Foster Wheeler Foundation; Foster Wheeler Funding
II LLC; Foster Wheeler Global Pharmaceuticals, LLC; Foster Wheeler Hudson
Falls, Inc.; Foster Wheeler Hydrobras, Inc.; Foster Wheeler Hydroven, Inc.;
Foster Wheeler Hydrox, Inc.; Foster Wheeler Ingenieros Y Constructores, S.A. de
C.V.; Foster Wheeler K.K.; Foster Wheeler (London) Limited; Foster Wheeler Penn
Resources, Inc.; Foster Wheeler (Philippines) Corporation; Foster Wheeler Rio
Grande, L.P.; Foster Wheeler Saudi Arabia Company Limited; Foster Wheeler
Somerset Limited Partnership; Foster Wheeler (Thailand) Limited; Foster Wheeler
Trading Company A.G., S.A.; Foster Wheeler Trading Company, Ltd.; Foster
Wheeler Vietnam Private LTD.; Foster Wheeler World Services Corporation; FW
European E&C Ltd.; FWPI Ltd.; FWPS Specialty Products, Inc.; Hartman Consulting
Corporation; HFM Field Services, Inc.; HFM Tray Canada, Ltd.; New Ashford,
Inc.; Oy Bioflow A.B.; Perryville Corporate Park Condominium Association, Inc.;
Somerset Corporate Center Associates; Thelco Co.; Tray, Inc.; Tray Special
Products, Inc.; Tray (UK) Limited.

 

“Voting Stock” means, with
respect to any Person, Capital Stock of any class or kind ordinarily having the
power to vote for the election of directors, managers or other voting members
of the governing body of such Person.

 

“Wholly Owned” means, with
respect to and Restricted Subsidiary, a Restricted Subsidiary all of the
outstanding capital stock of which (other than any director’s qualifying
shares) is owned by the Company and/or one or more of its Wholly Owned
Restricted Subsidiaries (or a combination thereof).

 

Section 1.02.  Trust Indenture Act Provisions.  Whenever this Indenture refers to a
provision of the TIA, the provision is incorporated by reference in and made a
part of this Indenture.  All other terms
used in this Indenture that are defined by the TIA, defined by reference to
another statute or defined by SEC rule under the TIA have the meanings so
assigned to them.

 

Section 1.03. 
Rules of Construction. 
Unless the context otherwise requires or except as otherwise expressly
provided,

 

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

 

(2)                                  “herein,”
“hereof” and other words of similar import refer to this Indenture as a whole
and not to any particular Section, Article or other subdivision;

 

(3)                                  all
references to Sections or Articles or Exhibits refer to Sections or Articles or
Exhibits of or to this Indenture unless otherwise indicated;

 

30

 

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

 

(5)                                  references
to a Person shall include such Person’s permitted successors and assigns;

 

(6)                                  references
to agreements or instruments, or to statutes or regulations (or sections
thereunder), are to such agreements or instruments, or statutes or regulations,
as amended from time to time (or to successor statutes and regulations)(or
sections thereunder); and

 

(7)                                  in
the event that a transaction meets the criteria of more than one category of
permitted transactions or listed exceptions the Company may classify such
transaction as it, in its sole discretion, determines.

 

ARTICLE 2

THE NOTES

 

Section 2.01. 
Form, Dating and Denominations; Legends.  (a) 
The Series A Notes and the related Trustee’s certificate of authentication
will be substantially in the form attached as Exhibit A.  The Series B Notes and the related Trustee’s
certificate of authentication will be substantially in the form attached as
Exhibit B.  The terms and provisions
contained in the forms of the Notes annexed as Exhibits A and B constitute, and
are hereby expressly made, a part of this Indenture.  The Notes may have notations, legends or endorsements required by
law, rules of or agreements with national securities exchanges to which the
Company is subject, or usage.  Each Note
will be dated the date of its authentication. 
The Notes will be issuable in denominations of $1.00 in principal amount
and any multiple of $1.00 in excess thereof.

 

(b)                                 (1)                                  Except
as otherwise provided in paragraph (c) of this Section 2.01, Sections
2.10(b)(3), (b)(5), or (c) or Section 2.09(b)(4), each Initial Series B
Note and each Private Exchange Note will bear the Restricted Legend.

 

(2)                                  Each
Global Note, whether or not an Initial Series B Note, will bear the DTC Legend.

 

(3)                                  Initial
Series B Notes offered and sold in reliance on any exception under the
Securities Act other than Regulation S or Rule 144A will be issued, and upon
the request of the Company to the Trustee, Initial Series B Notes offered and
sold in reliance on Rule 144A may be issued, in the form of Certificated Notes.

 

(4)                                  Exchange
Notes will be issued, subject to Section 2.09(b), in the form of one or
more Global Notes.

 

(c)                                  (1)                                  If
the Company determines (upon the advice of counsel and such other
certifications and evidence as the Company may reasonably require) that an
Initial Series B Note or a Private Exchange Note is eligible for resale
pursuant to Rule 144(k) under the Securities Act (or a successor provision) and
that the Restricted Legend is no longer necessary or appropriate in

 

31

 

order to ensure that subsequent transfers of the Note
(or a beneficial interest therein) are effected in compliance with the
Securities Act, or

 

(2)                                  after
an Initial Series B Note or a Private Exchange Note is

 

(x)                                   sold
pursuant to an effective registration statement under the Securities Act,
pursuant to the Registration Rights Agreement, the Additional Registration
Rights Agreement or otherwise, or (y) is validly tendered for exchange into an
Exchange Note pursuant to an Exchange Offer

 

the Company may instruct
the Trustee to cancel the Initial Series B Note or Private Exchange Note, as
the case may be, and issue to the Holder thereof (or to its transferee) a new
Note of like series (in the case of Private Exchange Notes), tenor and amount,
registered in the name of the Holder thereof (or its transferee), that does not
bear the Restricted Legend, and the Trustee will comply with such instruction.

 

(d)                                 By
its acceptance of any Note bearing the Restricted Legend (or any beneficial
interest in such a Note), each Holder thereof and each owner of a beneficial
interest therein acknowledges the restrictions on transfer of such Note (and
any such beneficial interest) set forth in this Indenture and in the Restricted
Legend and agrees that it will transfer such Note (and any such beneficial
interest) only in accordance with this Indenture and the Restricted Legend.

 

Section 2.02. 
Execution and Authentication; Exchange Notes.  (a) An Officer shall execute the Notes for
the Company by facsimile or manual signature in the name and on behalf of the
Company.  If an Officer whose signature
is on a Note no longer holds that office at the time the Note is authenticated,
the Note will still be valid.

 

(b)                                 A
Note shall not be valid until the Trustee manually signs the certificate of
authentication on the Note, with the signature conclusive evidence that the
Note has been authenticated under this Indenture.

 

(c)                                  At
any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Notes executed by the Company to the Trustee
for authentication.  The Trustee shall
authenticate and deliver:

 

(i)                                     Initial
Series A Notes for original issue in the aggregate principal amount not to
exceed $150,000,000,

 

(ii)                                  Initial
Series B Notes for original issue in the aggregate principal amount not to
exceed $120,000,000, and

 

(iii)                               Exchange
Notes and Private Exchange Notes from time to time for issue in exchange for a
like aggregate principal amount of Initial Series B Notes,

 

in each case, after the
following conditions have been met:

 

(1)                                  Receipt
by the Trustee of an Officers’ Certificate specifying:

 

32

 

(A)                              the
amount of Notes to be authenticated and the date on which the Notes are to be
authenticated,

 

(B)                                whether
the Notes are to be Initial Series A Notes, Initial Series B Notes, Exchange
Notes or Private Exchange Notes,

 

(C)                                whether
the Notes are to be issued as one or more Global Notes or Certificated Notes,
and

 

(D)                               other
information the Company may determine to include or the Trustee may reasonably
request.

 

(2)                                  In
the case of Exchange Notes, effectiveness of an Exchange Offer Registration
Statement, or a shelf registration statement pursuant to the Additional
Registration Rights Agreement, and consummation of the exchange offer or
resale, as the case may be, thereunder (and receipt by the Trustee of an
Officers’ Certificate to that effect). 
Initial Series B Notes exchanged for Exchange Notes will be cancelled by
the Trustee.

 

(d)                                 If
Series B Notes are sold by a Holder pursuant to a resale shelf registration
statement required by the Additional Registration Rights Agreement, then such
sale will be effected by the cancellation of such Series B Notes, and the
issuance of a like principal amount of Series A Notes to the purchaser thereof.

 

(e)                                  Upon
the request of a Holder of Series B Notes, the Company shall issue and deliver
to such Holder, in exchange (a “Private Exchange”) for such Series B Notes
a like principal amount of Series A Notes that are identical in all material
respects to the Series A Notes (the “Private Exchange Notes”) and which are
issued pursuant to this Indenture; provided that (i) such Private Exchange
Securities shall bear the Restrictive Legend and (ii) the Company shall have
received satisfactory opinions and certificates from such Holder with respect
to the Private Exchange.

 

Section 2.03. 
Registrar, Paying Agent and Authenticating Agent; Paying Agent to
Hold Money in Trust.  (a)  The Company may
appoint one or more Registrars and one or more Paying Agents, and the Trustee
may appoint an Authenticating Agent, in which case each reference in this Indenture
to the Trustee in respect of the obligations of the Trustee to be performed by
that Agent will be deemed to be references to the Agent.  The Company may act as Registrar or (except
for purposes of Article 8) Paying Agent. 
In each case an Agent is appointed pursuant to this
Section 2.03(a), the Company and the Trustee will enter into an
appropriate agreement with such Agent implementing the provisions of this
Indenture relating to the obligations of the Trustee to be performed by such
Agent and the parties’ related rights. 
The Company initially appoints the Trustee as Registrar and Paying Agent
and the Trustee hereby accepts such appointments.

 

(b)                                 The
Company will require each Paying Agent other than the Trustee to agree in
writing that such Paying Agent will hold in trust for the benefit of the
Holders or the Trustee all money held by such Paying Agent for the payment of
principal of and interest on the Notes and will promptly notify the Trustee of
any default by the Company in making any such payment.  

 

33

 

The Company at any time may require a Paying Agent to
pay all money held by it to the Trustee and account for any funds disbursed,
and the Trustee may at any time during the continuance of any payment default,
upon written request to a Paying Agent, require the Paying Agent to pay all
money held by it to the Trustee and to account for any funds disbursed.  Upon doing so, the Paying Agent will have no
further liability for the money so paid over to the Trustee.

 

Section 2.04. 
Replacement Notes.  If any mutilated Note is surrendered to the Trustee, the Company
shall execute and, upon the Company’s written request, the Trustee shall
authenticate and deliver a new definitive Note, of like series, tenor and
aggregate principal amount and equal face amount of principal, registered in
the same manner, dated the date of its authentication and bearing interest from
the date to which interest has been paid on such Note, in exchange and
substitution for such Note (upon surrender and cancellation thereof); provided,
that the applicant for such new Note shall furnish to the Company and to the
Trustee such reasonable bond or indemnity as may be required by them to save
each of them harmless.

 

If there shall be
delivered to the Company and the Trustee (a) evidence to their satisfaction of
the destruction, loss or theft of any Note and (b) such bond or indemnity as
may be required by them to save each of them and any agent of either of them
harmless, then, in the absence of notice to the Company or the Trustee that
such Note has been acquired by a bona fide purchaser, the Company shall execute
and, upon the Company’s request, the Trustee shall authenticate and deliver a
new definitive Note, of like tenor and aggregate principal amount and equal
face amount of principal registered in the same manner, dated the date of its
authentication and bearing interest from the date to which interest has been
paid on such Note, in lieu of and substitution for such Note.

 

Upon the issuance of any
new Note under this Section 2.04, the Company may require the payment of a
sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith.

 

Every new Note issued
pursuant to this Section 2.04 in lieu of any destroyed, lost or stolen
Note shall constitute an original additional contractual obligation of the
Company.

 

The provisions of this
Section 2.04 are exclusive and shall preclude (to the extent lawful) all
other rights and remedies with respect to the replacement or payment of
mutilated, destroyed, lost or stolen Notes.

 

Section 2.05.  Outstanding Notes. 
(a)  Notes outstanding at any
time shall be all Notes that have been authenticated by the Trustee except for:

 

(1)                                  Notes
cancelled by the Trustee or delivered to it for cancellation;

 

(2)                                  any
Note which has been replaced pursuant to Section 2.04 unless and until the
Trustee and the Company receive proof satisfactory to them that the replaced
Note is held by a bona fide purchaser; and

 

(3)                                  on
or after the maturity date or any redemption date or date for purchase of the
Notes pursuant to an Offer to Purchase, those Notes payable or to be redeemed
or

 

34

 

purchased on that date for
which the Trustee (or Paying Agent, other than the Company or an Affiliate of
the Company) holds money sufficient to pay all amounts then due.

 

(b)                                 A
Note shall not cease to be outstanding because the Company or one of its
Affiliates holds the Note, provided that in determining whether the Holders of
the requisite principal amount of the outstanding Notes have given or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder, Notes owned by the Company or any Affiliate of the Company
shall be disregarded and deemed not to be outstanding, (it being understood
that in determining whether the Trustee is protected in relying upon any such
request, demand, authorization, direction, notice, consent, waiver or other action,
only Notes which a Responsible Officer of the Trustee actually knows to be so
owned shall be so disregarded).  Notes
so owned which have been pledged in good faith may be regarded as outstanding
if the pledgee establishes to the satisfaction of the Trustee the pledgee’s
right to act with respect to such Notes and that the pledgee is not the Company
or any Affiliate of the Company.

 

Section 2.06.  Temporary Notes.  Until
definitive Notes are ready for delivery, the Company may prepare and execute
and the Trustee will authenticate and deliver temporary Notes.  Temporary Notes will be substantially in the
form of definitive Notes but may have insertions, substitutions, omissions and
other variations determined to be appropriate by the Officer executing the
temporary Notes, as evidenced by the execution of the temporary Notes.  If temporary Notes are issued, the Company
shall cause definitive Notes to be prepared without unreasonable delay.  After the preparation of definitive Notes,
the temporary Notes will be exchangeable for definitive Notes upon surrender of
the temporary Notes at the office or agency of the Company designated for such
purpose pursuant to Section 4.02, without charge to the Holder.  Upon surrender for cancellation of any
temporary Notes, the Company will execute and the Trustee will authenticate and
deliver in exchange therefor a like principal amount of definitive Notes of
authorized denominations.  Until so
exchanged, the temporary Notes will be entitled to the same benefits under this
Indenture as definitive Notes.

 

Section 2.07.  Cancellation.  All Notes surrendered for payment, redemption, registration of
transfer or exchange shall, if surrendered to any Person other than the
Trustee, be delivered to the Trustee and shall be promptly canceled by it.  The Company at any time may deliver to the
Trustee for cancellation any Notes previously authenticated and delivered
hereunder which the Company may have acquired in any manner whatsoever, and may
deliver to the Trustee for cancellation any Notes previously authenticated
hereunder which the Company has not issued and sold.  Any Registrar or the Paying Agent will forward to the Trustee any
Notes surrendered to it for transfer, exchange or payment.  The Trustee will cancel all Notes surrendered
for transfer, exchange, payment or cancellation and dispose of them in
accordance with its normal procedures. 
The Company may not issue new Notes to replace Notes it has paid in full
or delivered to the Trustee for cancellation.

 

Section 2.08.  CUSIP and CINS Numbers. 
The Company in issuing the Notes shall use “CUSIP” and “CINS”
numbers, and the Trustee will use CUSIP or CINS numbers in notices of
redemption or exchange or in Offers to Purchase as a convenience to Holders,
any such notice shall state that no representation is made as to the
correctness of such numbers either as printed

 

35

 

on the Notes or as
contained in any notice of redemption or exchange or Offer to Purchase.  The Company will promptly notify the Trustee
of any change in the CUSIP or CINS numbers.

 

Section 2.09.  Registration, Transfer and Exchange.  (a) 
The Notes will be issued in registered form only, without coupons, and
the Company shall cause the Trustee to maintain a register (the “Register”) of the
Notes, for registering the record ownership of the Notes by the Holders and
transfers and exchanges of the Notes.

 

(b)  (1)             Each Global Note will be registered in the
name of the Depositary or its nominee and, so long as DTC is serving as the
Depositary thereof, will bear the DTC Legend.

 

(2)                                  Each
Global Note will be delivered to the Trustee as custodian for the
Depositary.  Transfers of a Global Note
(but not a beneficial interest therein) will be limited to transfers thereof in
whole, but not in part, to the Depositary, its successors or their respective
nominees, except (1) as set forth in Section 2.09(b)(4) and (2) transfers
of portions thereof in the form of Certificated Notes may be made upon request
of an Agent Member (for itself or on behalf of a beneficial owner) by written
notice given to the Trustee by or on behalf of the Depositary in accordance
with customary procedures of the Depositary and in compliance with this
Section 2.09 and Section 2.10.

 

(3)                                  Agent
Members will have no rights under this Indenture with respect to any Global
Note held on their behalf by the Depositary, and the Depositary may be treated
by the Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner and Holder of such Global Note for all purposes whatsoever.  Notwithstanding the foregoing, the
Depositary or its nominee may grant proxies and otherwise authorize any Person
(including any Agent Member and any Person that holds a beneficial interest in
a Global Note through an Agent Member) to take any action which a Holder is
entitled to take under this Indenture or the Notes, and nothing herein will
impair, as between the Depositary and its Agent Members, the operation of
customary practices governing the exercise of the rights of a holder of any
security.

 

(4)                                  If
(x) the Depositary notifies the Company that it is unwilling or unable to
continue as Depositary for a Global Note and a successor depositary is not
appointed by the Company within 90 days of such notice or (y) an Event of
Default has occurred and is continuing and the Trustee has received a written
request from the Depositary, the Trustee will promptly exchange each beneficial
interest in the Global Note for one or more Certificated Notes in authorized
denominations having an equal aggregate principal amount registered in the name
of the owner of such beneficial interest, as identified to the Trustee by the
Depositary in writing, and thereupon the Global Note will be deemed
canceled.  If such Note does not bear
the Restricted Legend, then the Certificated Notes issued in exchange therefor
will not bear the Restricted Legend.  If
such Note bears the Restricted Legend, then the Certificated Notes issued in
exchange therefor will bear the Restricted Legend, provided that any Holder of
any such Certificated Note issued in exchange for a beneficial interest in an
Offshore Global Note will have the right upon presentation to the Trustee of a
duly completed Certificate of Beneficial Ownership after the Restricted Period
to exchange such Certificated Note for a Certificated Note of like

 

36

 

tenor and amount
that does not bear the Restricted Legend, registered in the name of such
Holder.

 

(c)                                  Each
Certificated Note will be registered in the name of the Holder thereof or its
nominee.

 

(d)                                 A
Holder may transfer a Note (or a beneficial interest therein) to another Person
or exchange a Note (or a beneficial interest therein) for another Note or Notes
of any authorized denomination by presenting to the Trustee a written request
therefor stating the name of the proposed transferee or requesting such an
exchange, accompanied by any certification, opinion or other document required
by Section 2.10.  The Trustee will
promptly register any transfer or exchange that meets the requirements of this
Section 2.09 by noting the same in the register maintained by the Trustee
for the purpose; provided that:

 

(x)                                   no
transfer or exchange will be effective until it is registered in such register;
and

 

(y)                                 the
Trustee will not be required (i) to issue, register the transfer of or exchange
any Note for a period of 15 days before a selection of Notes to be redeemed or
purchased pursuant to an Offer to Purchase, (ii) to register the transfer of or
exchange any Note so selected for redemption or purchase in whole or in part,
except, in the case of a partial redemption or purchase, that portion of any
Note not being redeemed or purchased, or (iii) if a redemption or a purchase
pursuant to an Offer to Purchase is to occur after a Regular Record Date but on
or before the corresponding Interest Payment Date, to register the transfer of
or exchange any Note on or after the Regular Record Date and before the date of
redemption or purchase.  Prior to the
registration of any transfer, the Company, the Trustee and their agents will
treat the Person in whose name the Note is registered as the owner and Holder
thereof for all purposes (whether or not the Note is overdue), and will not be
affected by notice to the contrary.

 

From time to time the
Company will execute and the Trustee will authenticate and deliver additional
Notes as necessary in order to permit the registration of a transfer or
exchange in accordance with this Section 2.09.

 

No service charge will be
imposed in connection with any transfer or exchange of any Note, 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 a
transfer tax or other similar governmental charge payable upon exchange
pursuant to subsection (b)(4) of this Section 2.09).

 

(e) (1)                 Global Note to
Global Note.  If a beneficial
interest in a Global Note is transferred or exchanged, in accordance with
Section 2.10, for a beneficial interest in another Global Note, the
Trustee will (x) record a decrease in the principal amount of the Global Note
being transferred or exchanged equal to the principal amount of such transfer
or exchange and (y) record a like increase in the principal amount of the other

 

37

 

Global Note.  Any beneficial interest in one Global Note
that is transferred to a Person who takes delivery in the form of an interest
in another Global Note, or exchanged for an interest in another Global Note,
will, upon transfer or exchange, cease to be a beneficial interest in such
Global Note and become a beneficial interest in the other Global Note and,
accordingly, will thereafter be subject to all transfer and exchange
restrictions, if any, and other procedures applicable to beneficial interests
in such other Global Note for as long as it remains such an interest.

 

(2)                                  Global
Note to Certificated Note.  If a
beneficial interest in a Global Note is transferred or exchanged, in accordance
with Section 2.10, for a Certificated Note, the Trustee will (x) record a
decrease in the principal amount of such Global Note equal to the principal
amount of such transfer or exchange and (y) deliver one or more new
Certificated Notes in authorized denominations having an equal aggregate
principal amount to the transferee (in the case of a transfer) or the owner of
such beneficial interest (in the case of an exchange), registered in the name
of such transferee or owner, as applicable.

 

(3)                                  Certificated
Note to Global Note.  If a
Certificated Note is transferred or exchanged, in accordance with
Section 2.10, for a beneficial interest in a Global Note, the Trustee will
(x) cancel such Certificated Note, (y) record an increase in the principal
amount of such Global Note equal to the principal amount of such transfer or
exchange and (z) in the event that such transfer or exchange involves less than
the entire principal amount of the canceled Certificated Note, deliver to the
Holder thereof one or more new Certificated Notes in authorized denominations
having an aggregate principal amount equal to the untransferred or unexchanged
portion of the canceled Certificated Note, registered in the name of the Holder
thereof.

 

(4)                                  Certificated
Note to Certificated Note.  If a Certificated
Note is transferred or exchanged, in accordance with Section 2.10, for
another Certificated Note, the Trustee will (x) cancel the Certificated Note
being transferred or exchanged, (y) deliver one or more new Certificated Notes
in authorized denominations having an aggregate principal amount equal to the
principal amount of such transfer or exchange to the transferee (in the case of
a transfer) or the Holder of the canceled Certificated Note (in the case of an
exchange), registered in the name of such transferee or Holder, as applicable,
and (z) if such transfer or exchange involves less than the entire principal
amount of the canceled Certificated Note, deliver to the Holder thereof one or
more Certificated Notes in authorized denominations having an aggregate
principal amount equal to the untransferred or unexchanged portion of the
canceled Certificated Note, registered in the name of the Holder thereof.

 

Section 2.10.  Restrictions on Transfer and Exchange.  (a) The transfer or exchange of any Note (or
a beneficial interest therein) may only be made in accordance with this
Section 2.10, Section 2.02 and Section 2.09 and, in the case of
a Global Note (or a beneficial interest therein), the applicable rules and
procedures of the Depositary.  The Trustee
shall refuse to register any requested transfer or exchange that does not
comply with the preceding sentence.

 

38

 

(b)                                 Subject
to paragraph (c), the transfer or exchange of any Series B Note (or a beneficial
interest therein) of the type set forth in column A below for a Series B Note
(or a beneficial interest therein) of the type set forth opposite in column B
below may only be made in compliance with the certification requirements (if
any) described in the clause of this paragraph set forth opposite in column C
below.

 

	
  A

  	
   

  	
  B

  	
   

  	
  C

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  U.S. Global Note

  	
   

  	
  U.S. Global Note

  	
   

  	
  (1)

  	
   

  
	
  U.S. Global Note

  	
   

  	
  Offshore Global Note

  	
   

  	
  (2)

  	
   

  
	
  U.S. Global Note

  	
   

  	
  Certificated Note

  	
   

  	
  (3)

  	
   

  
	
  Offshore Global Note

  	
   

  	
  U.S. Global Note

  	
   

  	
  (4)

  	
   

  
	
  Offshore Global Note

  	
   

  	
  Offshore Global Note

  	
   

  	
  (1)

  	
   

  
	
  Offshore Global Note

  	
   

  	
  Certificated Note

  	
   

  	
  (5)

  	
   

  
	
  Certificated Note

  	
   

  	
  U.S. Global Note

  	
   

  	
  (4)

  	
   

  
	
  Certificated Note

  	
   

  	
  Offshore Global Note

  	
   

  	
  (2)

  	
   

  
	
  Certificated Note

  	
   

  	
  Certificated Note

  	
   

  	
  (3)

  	
   

  

 

(1)                                  No
certification is required.

 

(2)                                  The
Person requesting the transfer or exchange must deliver or cause to be
delivered to the Trustee a duly completed Regulation S Certificate; provided
that if the requested transfer or exchange is made by the Holder of a
Certificated Note that does not bear the Restricted Legend, then no
certification is required.

 

(3)                                  The
Person requesting the transfer or exchange must deliver or cause to be
delivered to the Trustee (x) a duly completed Rule 144A Certificate, (y) a duly
completed Regulation S Certificate or (z) a duly completed Institutional
Accredited Investor Certificate, and/or an Opinion of Counsel and such other
certifications and evidence as the Company may reasonably require in order to
determine that the proposed transfer or exchange is being made in compliance
with the Securities Act and any applicable securities laws of any state of the
United States; provided that if the requested transfer or exchange is made by
the Holder of a Certificated Note that does not bear the Restricted Legend,
then no certification is required.  In
the event that (i) the requested transfer or exchange takes place after the
Restricted Period and a duly completed Regulation S Certificate is delivered to
the Trustee or (ii) a Certificated Note that does not bear the Restricted
Legend is surrendered for transfer or exchange, upon such transfer or exchange
the Trustee will deliver a Certificated Note that does not bear the Restricted
Legend.

 

(4)                                  The
Person requesting the transfer or exchange must deliver or cause to be
delivered to the Trustee a duly completed Rule 144A Certificate.

 

(5)                                  Notwithstanding
anything to the contrary contained herein, if the requested transfer involves a
beneficial interest in an Offshore Global Note during the Restricted Period,
the Person requesting the transfer must deliver or cause to be delivered to the
Trustee (x) a duly completed Rule 144A Certificate or (y) a duly completed

 

39

 

Institutional Accredited
Investor Certificate and/or an Opinion of Counsel and such other certifications
and evidence as the Company may reasonably require in order to determine that
the proposed transfer is being made in compliance with the Securities Act and
any applicable securities laws of any state of the United States.  If the requested transfer or exchange
involves a beneficial interest in an Offshore Global Note following expiration
of the Restricted Period, no certification is required and the Trustee will
deliver a Certificated Note that does not bear the Restricted Legend.

 

(c)                                  No
certification is required in connection with any transfer or exchange of any
Series B Note or Private Exchange Note (or a beneficial interest therein):

 

(1)                                  after
such Series B Note is eligible for resale pursuant to Rule 144(k) under the
Securities Act (or a successor provision); provided that the Company has
provided the Trustee with an Officer’s Certificate to that effect, and the
Company may require from any Person requesting a transfer or exchange in
reliance upon this clause (1) an opinion of counsel in customary form and
containing customary qualifications for resales of such type, and any other
reasonable certifications and evidence in order to support such certificate; or

 

(2)(x)                     sold pursuant
to an effective registration statement, including a resale shelf registration
statement, pursuant to the Registration Rights Agreement, the Additional
Registration Rights Agreement or otherwise or (y) which is validly tendered for
exchange into an Exchange Note pursuant to an Exchange Offer for an Exchange
Note.

 

Any Certificated Note
delivered in reliance upon this paragraph will not bear the Restricted Legend.

 

(d)                                 The
Trustee will retain copies of all certificates, opinions and other documents
received in connection with the transfer or exchange of a Note (or a beneficial
interest therein), and the Company will have the right to inspect and make
copies thereof at any reasonable time upon reasonable written notice to the
Trustee delivered a reasonable time prior to such inspection.

 

(e)                                  No
certification is required in connection with any transfer or exchange of any
Series A Note that is not a Private Exchange Note (or a beneficial interest
therein).

 

Section 2.11.  Temporary Offshore Global Notes.  (a) Each Initial Series B Note originally
sold by the Purchasers in reliance upon Regulation S will be evidenced by one
or more Offshore Global Notes that bear the Temporary Offshore Global Note
Legend.

 

(b)                                 An
owner of a beneficial interest in a Temporary Offshore Global Note (or a Person
acting on behalf of such an owner) may provide to the Trustee (and the Trustee
will accept) a duly completed Certificate of Beneficial Ownership at any time
after the Restricted Period (it being understood that the Trustee will not
accept any such certificate during the Restricted Period).  Promptly after acceptance of a Certificate
of Beneficial Ownership with respect to such a beneficial interest, the Trustee
will cause such beneficial interest to be exchanged for an equivalent
beneficial interest in a Permanent Offshore Global Note, and will (x)
permanently reduce the principal amount of such Temporary Offshore Global Note
by the

 

40

 

amount of such beneficial interest and (y) increase
the principal amount of such Permanent Offshore Global Note by the amount of
such beneficial interest.

 

(c)                                  Notwithstanding
anything to the contrary contained herein, beneficial interests in a Temporary
Offshore Global Note may be held through the Depositary only through Euroclear
and Clearstream and their respective direct and indirect participants.

 

(d)                                 Notwithstanding
paragraph (b), if after the Restricted Period any Purchaser owns a beneficial
interest in a Temporary Offshore Global Note, such Purchaser may, upon written
request to the Trustee accompanied by a certification as to its status as an
Purchaser, exchange such beneficial interest for an equivalent beneficial
interest in a Permanent Offshore Global Note, and the Trustee will comply with
such request and will (x) permanently reduce the principal amount of such
Temporary Offshore Global Note by the amount of such beneficial interest and
(y) increase the principal amount of such Permanent Offshore Global Note by the
amount of such beneficial interest.

 

ARTICLE 3

REDEMPTION; OFFER TO PURCHASE

 

Section 3.01.  Optional Redemption. 
At any time and from time to time on or after [     ], 2006, the Company may redeem the
Notes, in whole or in part, upon not less than 30 nor more than 60 days’ prior
notice, at a redemption price equal to the percentage of principal amount set
forth below plus accrued and unpaid interest to the redemption date if redeemed
during the twelve-month period beginning on
[                       ]
of the years indicated below:

 

	
  Year

  	
   

  	
  Percentage

  
	
  2006

  	
   

  	
  [100% plus 75% of
  coupon]

  
	
  2007

  	
   

  	
  [100% plus 62.5% of
  coupon]

  
	
  2008

  	
   

  	
  [100% plus 50% of
  coupon]

  
	
  2009

  	
   

  	
  [100% plus 25% of
  coupon]

  
	
  2010

  	
   

  	
  100.000%

  

 

Section 3.02.  Optional Redemption; Make Whole.  At any time prior to [        ], 2006, the
Company may, on any one or more occasions, redeem all or a part of the Notes,
upon not less than 30 nor more than 60 days’ prior notice, at a redemption
price equal to the greater of (i) 101% of the principal amount of the Notes to
be redeemed and (ii) 100% of the principal amount of the Notes to be redeemed
plus the Applicable Premium as of the date of redemption, and in each case plus
accrued and unpaid interest to, the date of redemption, subject to the rights
of Holders of the Notes on the relevant record date to receive interest due on
the relevant Interest Payment Date.

 

Section 3.03.  Method and Effect of Redemption.  (a) If the Company elects to redeem Notes,
it must notify the Trustee in writing of the redemption date and the principal
amount of

 

41

 

Notes to be redeemed by
delivering an Officers’ Certificate at least 45 days before the redemption date
(unless a shorter period is satisfactory to the Trustee).  If fewer than all of the Notes are being
redeemed, the Officers’ Certificate must also specify a record date not less
than 10 days after the date of the notice of redemption is given to the
Trustee, and the Trustee will select the Notes to be redeemed as follows: (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 the Notes are not listed on a national securities
exchange, on a pro rata basis (based on amounts tendered), by lot or by any
other method the Trustee deems fair and appropriate, in denominations of $1.00
principal amount and multiples thereof. 
The Trustee will notify the Company promptly of the Notes or portions of
Notes to be called for redemption. Any notice of redemption must be sent by
first-class mail by the Company or at the Company’s request, by the Trustee in
the name and at the expense of the Company, to Holders whose Notes are to be
redeemed at least 30 days but not more than 60 days before the redemption date.

 

(b)                                 The
notice of redemption will identify the Notes to be redeemed and will include or
state the following:

 

(1)                                  the
redemption date;

 

(2)                                  the
redemption price, including the portion thereof representing any accrued
interest;

 

(3)                                  the
place or places where Notes are to be surrendered for redemption and payment of
the redemption price;

 

(4)                                  that
Notes called for redemption must be so surrendered in order to collect the
redemption price;

 

(5)                                  on
the redemption date the redemption price will become due and payable on Notes
called for redemption, and interest on Notes called for redemption will cease
to accrue on and after the redemption date;

 

(6)                                  if
any Note is to be redeemed in part, the principal amount of such Note to be
redeemed and that after the redemption date, upon surrender of such Note, new
Notes of like series equal in principal amount to the unredeemed portion
thereof will be issued;

 

(7)                                  if
any Note contains a CUSIP or CINS number, the CUSIP or CINS number;

 

(8)                                  interest
on any Note not redeemed will continue to accrue; and

 

(9)                                  the
paragraph of the Notes and Section of this Indenture pursuant to which the
Notes called for redemption are being redeemed.

 

(c)                                  Once
a notice of redemption is sent to the Holders, Notes called for redemption
become due and payable at the redemption price on the redemption date, and upon
surrender of any Notes called for redemption, the Company shall redeem such
Notes at the applicable

 

42

 

redemption price. Commencing on the redemption date,
Notes redeemed will cease to accrue interest. 
Upon surrender of any Note redeemed in part, the Holder will receive a
new Note of like series equal in principal amount to the unredeemed portion of
the surrendered Note.

 

(d)                                 The
Company may acquire Notes by means other than a redemption, whether by tender
offer, open market purchases, negotiated transactions or otherwise, in
accordance with applicable securities laws, so long as such acquisitions do not
otherwise violate the terms of this Indenture.

 

Section 3.04.  Offer to Purchase. 
(a) An “Offer to Purchase” means an offer by the Company to purchase
Notes as required by this Indenture.  An
Offer to Purchase must be made by written offer (the “offer”) sent to the
Holders.  The Company will notify the
Trustee in writing at least 15 days (or such shorter period as is acceptable to
the Trustee) prior to sending the offer to Holders of its obligation to make an
Offer to Purchase, and the offer will be sent by the Company or, at the
Company’s request, by the Trustee in the name and at the expense of the
Company.

 

(b)                                 The
offer must include or state the following as to the terms of the Offer to
Purchase:

 

(1)                                  the
provision of this Indenture pursuant to which the Offer to Purchase is being
made;

 

(2)                                  the
aggregate principal amount of the outstanding Notes offered to be purchased by
the Company pursuant to the Offer to Purchase (including, if less than 100% of
the Notes, the manner by which such amount has been determined pursuant to this
Indenture) (the “purchase amount”);

 

(3)                                  the
purchase price, including the portion thereof representing accrued interest;

 

(4)                                  an
expiration date (the “expiration date”) not less than 30 Business
Days or more than 60 days after the date of the offer, and a settlement date
for purchase (the “purchase date”) not more than five Business
Days after the expiration date;

 

(5)                                  a
Holder may tender all or any portion of its Notes, subject to the requirement
that any portion of a Note tendered must be in a multiple of $1.00 principal
amount;

 

(6)                                  the
place or places where Notes are to be surrendered for tender pursuant to the
Offer to Purchase;

 

(7)                                  each
Holder electing to tender a Note pursuant to the offer will be required to
surrender such Note at the place or places specified in the offer prior to the
close of business on the expiration date (such Note being, if the Company or
the Trustee so requires, duly endorsed or accompanied by a duly executed
written instrument of transfer);

 

43

 

(8)                                  interest
on any Note not tendered, or tendered but not purchased by the Company pursuant
to the Offer to Purchase, will continue to accrue;

 

(9)                                  on
the purchase date the purchase price will become due and payable on each Note
accepted for purchase, and interest on Notes purchased will cease to accrue on
and after the purchase date;

 

(10)                            (i) if
Notes in an aggregate principal amount less than or equal to the purchase
amount are duly tendered and not withdrawn pursuant to the Offer to Purchase,
the Company will purchase all such Notes, and (ii) if the Offer to Purchase is
for less than all of the outstanding Notes and Notes in an aggregate principal
amount in excess of the purchase amount are duly tendered and not withdrawn
pursuant to the offer, the Company will purchase Notes having an aggregate
principal amount equal to the purchase amount on a pro rata basis, with
adjustments made in the Company’s discretion so that only Notes in multiples of
$1.00 principal amount will be purchased;

 

(11)                            if any
Note is purchased in part, new Notes of like series and equal in principal
amount to the unpurchased portion of the Note will be issued; and

 

(12)                            no
representation is being made as to the correctness of the CUSIP or CINS number
either as printed on the Notes or as contained in the offer and that the Holder
should rely only on the other identification numbers printed on the Notes.

 

(c)                                  Prior
to the purchase date, the Company will accept tendered Notes for purchase as
required by the Offer to Purchase and deliver to the Trustee all Notes so
accepted together with an Officers’ Certificate specifying which Notes have
been accepted for purchase.  On the
purchase date the purchase price will become due and payable on each Note
accepted for purchase, and interest on Notes purchased will cease to accrue on
and after the purchase date.  The
Trustee will promptly return to Holders any Notes not accepted for purchase and
send to Holders new Notes of like series and equal in principal amount to any
unpurchased portion of any Notes accepted for purchase in part.

 

(d)                                 The
Company will comply with Rule 14e-1 under the Exchange Act and all other
applicable laws in making any Offer to Purchase, and the above procedures will
be deemed modified as necessary to permit such compliance.

 

ARTICLE 4

COVENANTS

 

Section 4.01.  Payment Of Notes. 
(a)  The Company agrees to pay the principal of, premium, if
any, and interest on the Notes on the dates and in the manner provided in the
Notes and this Indenture.  Not later
than 9:00 A.M. (New York City time) on the due date of any principal of,
premium, if any, or interest on any Notes, or any redemption or purchase price
of the Notes, the Company will deposit with the Trustee (or Paying Agent) money
in immediately available funds sufficient to pay such amounts, provided that if
the Company or any Affiliate of the Company is acting as Paying Agent, it will,
on or before each due date, segregate and hold in a separate trust fund for the
benefit of the Holders a sum of money sufficient to pay such amounts until paid
to such Holders or otherwise disposed of as provided in this Indenture.  In

 

44

 

each case the Company will promptly notify the Trustee
in writing of its compliance with this paragraph.

 

(b)                                 An
installment of principal or interest will be considered paid on the date due if
the Trustee (or Paying Agent, other than the Company or any Affiliate of the
Company) holds on that date money designated for and sufficient to pay the
installment.  If the Company or any
Affiliate of the Company acts as Paying Agent, an installment of principal or
interest will be considered paid on the due date only if paid to the Holders.

 

(c)                                  The
Company agrees to pay interest on overdue principal, and overdue installments
of interest at the rate per annum specified in the Notes.

 

(d)                                 Payments
in respect of the Notes represented by the Global Notes are to be made by wire
transfer of immediately available funds to the accounts specified by the Holders
of the Global Notes. With respect to Certificated Notes, the Company will make
all payments by wire transfer of immediately available funds to the accounts
specified by the Holders thereof or, if no such account is specified, by
mailing a check to each Holder’s registered address by first-class mail.

 

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 where Notes may be surrendered for registration of transfer or
exchange or for presentation for payment and where notices and demands to or
upon the Company in respect of the Notes and this Indenture may be served.  The Company hereby initially designates the
Corporate Trust Office of the Trustee as such office of the Company.  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 to the Trustee.

 

The Company may also from
time to time designate one or more other offices or agencies where the Notes
may be surrendered or presented for any of such purposes and may from time to
time rescind such designations.  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.

 

Section 4.03.  Existence.  The
Company shall do or cause to be done all things necessary to preserve and keep
in full force and effect its existence and the existence of each of its
Restricted Subsidiaries in accordance with their respective organizational
documents, and the material rights, licenses and franchises of the Company and
each Restricted Subsidiary; provided that the Company is not required to
preserve any such right, license or franchise, or the existence of any
Restricted Subsidiary (including any Guarantor, subject to any applicable
provisions of Article 5), if the maintenance or preservation thereof is no
longer desirable in the conduct of the business of the Company and its
Restricted Subsidiaries taken as a whole; and provided further that this Section 4.03
does not prohibit any transaction otherwise permitted by Sections 4.12, 5.01 or
5.02.

 

45

 

Section 4.04.  Payment of
Taxes and other Claims. 
The Company shall pay or discharge, and cause each of its Subsidiaries
to pay or discharge before the same become delinquent (i) all material taxes,
assessments and governmental charges levied or imposed upon the Company or any
Subsidiary or its income or profits or property, and (ii) all material lawful claims
for labor, materials and supplies that, if unpaid, might by law become a Lien
(other than a Permitted Lien) upon the property of the Company or any
Subsidiary, other than any such tax, assessment, charge or claim the amount,
applicability or validity of which is being contested in good faith by
appropriate proceedings and for which adequate reserves (to the extent required
in accordance with GAAP) have been established.

 

Section 4.05.  Limitation on Debt and Disqualified or Preferred Stock.  (a) 
The Company:

 

(1)                                  will
not, and will not permit any of its Restricted Subsidiaries to, Incur any Debt
(including Acquired Debt); and

 

(2)                                  will
not, and will not permit any Restricted Subsidiary to, Incur any Disqualified
Stock and will not permit any of its Restricted Subsidiaries that are not
Guarantors to Incur any Preferred Stock (other than Disqualified or Preferred
Stock of Restricted Subsidiaries held by the Company and/or a Restricted
Subsidiary that is a Guarantor, so long as it is held);

 

provided that the Company may Incur, and
may permit any Guarantor to Incur, Debt (including Acquired Debt) or
Disqualified Stock, if, on the date of the Incurrence, after giving effect to
the Incurrence and the receipt and application of the proceeds therefrom, (x) the
Fixed Charge Coverage Ratio is not less than 2.25 to 1.0 and (y) the Senior
Debt to Consolidated Cash Flow Ratio does not exceed 3.50 to 1.0.

 

(b)                                 Notwithstanding
the foregoing, the Company and, to the extent provided below, any Restricted
Subsidiary may Incur any of the following (“Permitted Debt”):

 

(1)                                  Debt
(including Debt under the Credit Agreement and in respect of Trade Obligations
or Performance Obligations) of the Company or any Guarantor pursuant to Credit
Facilities (and of Restricted Subsidiaries pursuant to Guarantees of such
Credit Facilities) so long as the aggregate amount of such Credit Facilities,
including the Existing Letter of Credit Facility, does not exceed $250,000,000
(subject to reduction as provided in clause (z) below) at any one time
outstanding, provided that:

 

(v)                                 the
amount permitted by this paragraph (1) shall be $325,000,000 (subject to
reduction as provided in clause (z) below) if the Senior Debt to Consolidated
Cash Flow Ratio on the date of Incurrence of such Debt and on each day during
the 90-day period most recently ended prior to the date of such incurrence
(giving pro forma effect to such Incurrence as if such Incurrence had occurred
on the first day of such period) is less than or equal to 3.50 to 1.0,

 

(w)                               the
amount of revolving loans permitted by this paragraph (1) shall not exceed
$75,000,000 at any one time outstanding,

 

46

 

(x)                                   such
Credit Facilities may in addition at any time after
[         ], 2008 be increased by
$120,000,000 to $370,000,000 (or, if the conditions referred to in the
foregoing clause (v) have been satisfied, to $445,000,000), in each case
subject to reduction as provided in clause (z) below, to permit the Incurrence
of Qualified Term Loans,

 

(y)                                 no
Restricted Subsidiary may be obligated (whether as borrower or a guarantor
thereof) in respect of any Debt under any Credit Facility (including any
increase thereof pursuant to the foregoing clauses (v) or (x)), unless such
Restricted Subsidiary is a Guarantor under this Indenture, except that Excepted
Non-Guarantor Subsidiaries may remain obligated in respect of a Guarantee of
the Existing Letter of Credit Facility (but not any increase thereof) to the
extent such Guarantee is in effect on the Issue Date and

 

(z)                                   the
permitted amounts of Debt described above (i.e. $250,000,000, $325,000,000,
$370,000,000 and $445,000,000) shall be automatically reduced by the amount of
the Net Cash Proceeds of Asset Sales applied to the permanent reduction of any
Credit Facility pursuant to Section 4.11(a)(3)(A);

 

(2)                                  (i)
Debt of an Obligor, owing to an Obligor; provided that (x) any such Debt is
Incurred (A) pursuant to an Intercompany Note that is subordinated in right of
payment to the payment in full in cash of such Obligor’s obligations under the
Notes or its Note Guarantee thereof in the form attached as Exhibit J to this
Indenture and pledged in accordance with the Collateral Documents in favor of
the Trustee or the Notes Collateral Agent or (B) pursuant to the Intercompany
Cash Management Agreement provided that the obligations under the Intercompany
Cash Management Agreement are subordinated in right of payment to the payment
in full in cash of such Obligor’s obligation under the Notes or its Note
Guarantee, and (y) any disposition, pledge or transfer of any such Debt to a
Person (other than a disposition, pledge or transfer to an Obligor) shall be
deemed to be an Incurrence of such Indebtedness by such Obligor not permitted
by this clause (b)(2)(i);

 

(ii)                                  Debt
of any Obligor owing to any Restricted Subsidiary that is not a Guarantor;
provided that such Debt is Incurred (A) pursuant to an Intercompany Note in the
form attached as Exhibit J to this Indenture or (B) pursuant to the
Intercompany Cash Management Agreement provided that the obligations under the
Intercompany Cash Management Agreement are subordinated in right of payment to
the payment in full in cash of such Obligor’s obligation under the Notes or its
Note Guarantee; provided, further that any disposition, pledge or transfer of
any such Debt to a Person (other than a disposition pledge or transfer to the
Company or a Restricted Subsidiary) shall be deemed to be an incurrence of such
Indebtedness by such Obligor not permitted by this clause (b)(2)(ii);

 

(iii)                               Debt
of a Restricted Subsidiary that is not a Guarantor owing to another Restricted
Subsidiary that is not a Guarantor; provided that any disposition, pledge or
transfer of any such Debt to a Person (other than a disposition, pledge or
transfer to

 

47

 

the Company or a Restricted Subsidiary) shall be deemed to be an
incurrence of such Debt by the obligor not permitted by this clause
(b)(2)(iii); and

 

(iv)                              Debt
of any Restricted Subsidiary that is not a Guarantor owing to an Obligor;
provided that such Debt is Incurred (A) pursuant to an Intercompany Note in the
form attached as Exhibit K to this Indenture or (B) pursuant to the
Intercompany Cash Management Agreement; provided, further, that any disposition,
pledge or transfer of any such Debt to a Person (other than a disposition,
pledge or transfer to the Company or a Restricted Subsidiary) shall be deemed
to be an Incurrence of such Indebtedness by the Restricted Subsidiary not
permitted by this clause (b)(2)(iv).

 

Notwithstanding the
foregoing, any transaction pursuant to which any Restricted Subsidiary, which
holds debt owing by the Company or any Restricted Subsidiary, ceases to be a
Restricted Subsidiary shall be deemed to be the Incurrence of Debt of such
Restricted Subsidiary that is not permitted by this clause (b)(2).

 

(3)                                  Debt
of the Company pursuant to the Notes and Debt of any Guarantor pursuant to a
Note Guarantee of the Notes, in any case not to exceed $270,000,000 in
aggregate principal amount;

 

(4)                                  any
other Debt of the Company or any Restricted Subsidiary outstanding on
March 26, 2004 (other than (x) Debt outstanding under the Credit
Agreement, as to which the provisions of clause (b)(1) above shall be
applicable or (y) Debt outstanding under the U.K. Credit Facility, as to which
the provisions of clause (b)(10) below shall be applicable); provided, that the
amount of such Debt (excluding intercompany Debt and Trade Obligations) shall
not exceed $1,527,780,000 in the aggregate and the amount of such Debt
outstanding at Restricted Subsidiaries that are not Guarantors shall not exceed
$624,596,000 in the aggregate, in each case excluding amounts exchanged for
Capital Stock in the Exchange Offer contemplated by the Form S-4;

 

(5)                                  Debt
(“Permitted Refinancing Debt”)
of the Company or any Restricted Subsidiary constituting an extension or
renewal of, replacement of, or substitution for, or issued in exchange for, or
the net proceeds of which are used to repay, redeem, repurchase, refinance or
refund, including by way of defeasance (all of the above, for purposes of this
clause, “refinance”) then outstanding Debt in an amount not to exceed the
principal amount of the Debt so refinanced, plus any associated premiums and
reasonable fees and expenses; provided that

 

(A)                              in
case the Debt to be refinanced is subordinated in right of payment to the
Notes, the new Debt, by its terms or by the terms of any agreement or
instrument pursuant to which it is outstanding, is expressly made subordinate
in right of payment to the Notes at least to the extent that the Debt to be
refinanced is subordinated to the Notes,

 

(B)                                the
new Debt does not have a Stated Maturity prior to the Stated Maturity of the
Debt to be refinanced, and the Average Life of the new Debt is at least equal
to the remaining Average Life of the Debt to be refinanced,

 

48

 

(C)                                the
new Debt is incurred by the obligor on the Debt being refinanced; provided,
however, if the Debt being refinanced is Debt of a Restricted Subsidiary that
is not a Guarantor, such Debt may be refinanced by the Company or a Restricted
Subsidiary that is a Guarantor, and

 

(D)                               Debt
Incurred pursuant to clauses (1), (2), (6), (8), (9), (10), (11), (13), (14)
and (15) of this Section 4.05(b) may not be refinanced pursuant to this
clause (5), and no amount of Debt outstanding on March 26, 2004 that is
exchanged for Capital Stock in the proposed exchange offer contemplated by the
Form S-4 may be refinanced pursuant to this clause (5).

 

(6)                                  Hedging
Agreements of the Company or any Restricted Subsidiary entered into in the
ordinary course of business for the purpose of limiting risks associated with
the business of the Company and its Restricted Subsidiaries and not for
speculation;

 

(7)                                  Debt
of the Company or any Restricted Subsidiary, which may include Capital Leases,
Incurred after March 26, 2004 no later than 180 days after the date of
purchase or completion of construction or improvement of property for the
purpose of financing all or any part of the purchase price or cost of
construction or improvement; provided that the aggregate principal
amount of any Debt Incurred pursuant to this clause (b)(7), including all
Permitted Refinancing Debt Incurred to refinance Debt Incurred pursuant to this
clause (b)(7), may not exceed $60,000,000 at any one time outstanding;

 

(8)                                  Debt
of the Company and/or any Restricted Subsidiary consisting of a Guarantee of
Debt of a Joint Venture not to exceed $75,000,000 in aggregate principal amount
at any one time outstanding (the amount of Debt arising from any such Guarantee
to be determined as provided in clause (F) of the definition of “Debt”);

 

(9)                                  Debt
of any Obligor, consisting of a Guarantee of Debt of any other Obligor, and
Debt of any Restricted Subsidiary that is not a Guarantor, consisting of a
Guarantee of Debt of the Company or any Restricted Subsidiary, in each case
Incurred under any other clause of this Section 4.05;

 

(10)                            Debt
(including Debt in respect of the U.K. Credit Facility) of any Foreign
Restricted Subsidiary that is not a Guarantor Incurred after March 26,
2004 in an aggregate principal amount not to exceed $50,000,000 at any one time
outstanding;

 

(11)                            Debt
in an aggregate amount up to $35,000,000 Incurred by Martinez Cogen Limited Partnership
(“Martinez”) to finance
the repurchase or redemption of all of the Equity Interests in such entity held
by Persons other than the Company or any Subsidiary; provided that the Fixed
Charge Coverage Ratio immediately after giving effect to Incurrence of such
Debt and the acquisition of the Equity Interests of Martinez exceeds the Fixed
Charge Coverage Ratio immediately prior to the Incurrence of such Debt; provided
further that following any Incurrence of Debt made in reliance of this clause
(11), no Restricted Subsidiary other than a Guarantor shall be permitted to
make loans to Martinez, unless and until Martinez becomes a Guarantor of the
Notes, regardless of paragraph (b)(2) of this Section 4.05;

 

49

 

(12)                            Guarantees
by the Company or any Restricted Subsidiary of Debt of a customer or a
third-party guarantor of such customer’s Debt to a governmental export credit
agency, to the extent that such Guarantee obligation is conditioned on a
failure to perform by the Company, any Restricted Subsidiary or a Controlled
Joint Venture under an engineering procurement or construction contract entered
into with such customer or third-party guarantor; provided that any payments
made pursuant to such Guarantee shall be deemed to be the Incurrence of Debt by
the Company or such Restricted Subsidiary that is not permitted pursuant to
this clause (b)(12);

 

(13)                            Trade
Obligations of the Company or any of its Restricted Subsidiaries, until such
time as any amounts are drawn thereunder (with such draw constituting an
Incurrence of Debt not permitted by this clause (13) on the date of such draw
with the amount of the Incurrence being equal to the amount of such draw); provided
that Trade Obligations issued under the Credit Agreement or any Credit Facility
must be permitted under clause (b)(1) of this Section 4.05;

 

(14)                            Performance
Obligations of any Obligor constituting letters of credit issued under the
Credit Agreement or any replacement Credit Facility in compliance with the
requirements of clause (b)(1) of this Section 4.05;

 

(15)                            Performance
Obligations of the Company or any Restricted Subsidiary; provided that the
aggregate amount of Encumbered Performance Obligations of the Company or such
Restricted Subsidiaries shall not exceed $275,000,000 at any one time
outstanding; and

 

(16)                            Debt
of the Company or any Restricted Subsidiary Incurred after March 26, 2004
not otherwise permitted hereunder in an aggregate principal amount at any time
outstanding not to exceed $30,000,000 (which may include any Debt incurred for
any purpose, including but not limited to the purposes referred to in clauses
(1) through (15) of this Section 4.05(b)); provided, however, not more
than $10,000,000 in aggregate principal amount at any one time outstanding
pursuant to this clause (b)(16) may be incurred by Restricted Subsidiaries that
are not also Guarantors.

 

For purposes of
determining compliance with this Section 4.05:

 

(1)                                  in
the event that an item of proposed Debt (including Acquired Debt) meets the
criteria of more than one of the categories of Permitted Debt described in
clauses (1) through (16) of this Section 4.05(b), or is entitled to be
Incurred pursuant to Section 4.05(a), the Company will be permitted to
classify (or later reclassify in whole or in part) such item of Debt in any
manner that complies with this Section 4.05(b); and

 

(2)                                  the
accrual of interest, the accretion or amortization of original issue discount
and the payment of interest on any Debt in the form of additional Debt with the
same terms will not be deemed to be an incurrence of Debt for purposes of this
Section 4.05(b).

 

50

 

(c)                                  The
Company shall terminate and cause its Restricted Subsidiaries to terminate the
Foothill Facility on October 1, 2004, if it has not earlier been
terminated.  The Company shall not Incur
any Debt thereunder prior to such termination.

 

(d)                                 For
purposes hereof, any Indebtedness Incurred by the Company or any of its
Restricted Subsidiaries subsequent to March 26, 2004 and still outstanding
on the Issue Date shall be deemed to have been Incurred on the Issue Date (and,
to the extent that such Indebtedness would not have been permitted to be
Incurred at such time under this Section 4.05, the Company shall be deemed
to be in breach of this Section 4.05).

 

Section 4.06.  Limitation
on Restricted Payments.

 

(a)                                  the
Company will not, and will not permit any Restricted Subsidiary to, directly or
indirectly (the payments and other actions described in the following clauses
of this Section 4.06(a) being collectively called “Restricted Payments”):

 

(i)                                     declare
or pay any dividend or make any distribution on its Equity Interests (other
than dividends or distributions paid in the Company’s Qualified Equity Interests)
held by Persons other than the Company or any of its Restricted Subsidiaries;

 

(ii)                                  purchase,
redeem or otherwise acquire or retire for value any Equity Interests of the
Company or any Restricted Subsidiary held by Persons other than the Company or
any of its Restricted Subsidiaries;

 

(iii)                               repay,
redeem, repurchase, defease or otherwise acquire or retire for value, or make
any payment on or with respect to Subordinated Debt (other than among the
Company and any of its Restricted Subsidiaries or any Restricted Subsidiary and
any other Restricted Subsidiaries) except payments of interest and principal at
Stated Maturity; or

 

(iv)                              make
any Investment other than a Permitted Investment;

 

unless, at the time of,
and after giving effect to, the proposed Restricted Payment:

 

(1)                                  no
Default or Event of Default has occurred and is continuing or would occur as a
consequence of such Restricted Payment,

 

(2)                                  the
Company at the time of such Restricted Payment and after giving pro forma
effect thereto as if such Restricted Payment had been made at the beginning of
the applicable period could Incur at least $1.00 of Debt under
Section 4.05(a), and

 

(3)                                  the
aggregate amount expended by the Company and its Restricted Subsidiaries for
all Restricted Payments made after March 26, 2004 would not, subject to
paragraph (c), exceed the sum of:

 

(A)                              50%
of the aggregate amount of the Consolidated Net Income (or, if the Consolidated
Net Income is a loss, minus 100% of the amount of the loss) accrued on a
cumulative basis during the period, taken as one accounting period,

 

51

 

beginning on the first
day of the fiscal quarter in which the Issue Date occurs and ending on the last
day of the Company’s most recently completed fiscal quarter for which internal
financial statements are available; plus

 

(B)                                subject
to paragraph (c), the aggregate net cash proceeds received by the Company
(other than from a Subsidiary) after the Issue Date:

 

(i)                                     from
the issuance and sale of its Qualified Equity Interests, including by way of
issuance of its Disqualified Equity Interests or Debt to the extent since
converted into Qualified Equity Interests of the Company (but excluding any
Qualified Equity Interests to the extent issued in or in connection with the
proposed exchange offer or offering described in the Form S-4), provided that
amounts received by Parents as payments of the applicable exercise price of any
warrants or options issued in connection with the proposed exchange offer shall
be included, or

 

(ii)                                  as
a contribution to its common equity; plus

 

(C)                                an
amount equal to the sum, for all Unrestricted Subsidiaries, of the following:

 

(x)                                   the
cash return, after March 26, 2004, on Investments in any Unrestricted
Subsidiary made after March 26, 2004 pursuant to this paragraph (a) as a
result of any sale for cash, repayment, redemption, liquidating distribution or
other cash realization (including any dividends or other distributions paid in
cash to the Company or any Restricted Subsidiary), plus

 

(y)                                 the
portion (proportionate to the Company’s equity interest in such Subsidiary) of
the Fair Market Value of the assets less liabilities of an Unrestricted
Subsidiary at the time such Unrestricted Subsidiary is designated a Restricted
Subsidiary,

 

not to exceed, in the
case of any Unrestricted Subsidiary, the amount of Investments made after
March 26, 2004 by the Company and its Restricted Subsidiaries in such
Unrestricted Subsidiary pursuant to paragraph (a) of this Section 4.06;
plus

 

(D)                               to
the extent not already included in clause (3)(A) above, the cash return on any
other Investment made after March 26, 2004 pursuant to paragraph (a) of
this Section 4.06, as a result of any sale for cash, repayment,
redemption, liquidating distribution or other cash realization (including any
dividends or other distributions paid in cash to the Company or any Restricted
Subsidiary), in an amount equal to the lesser of (x) the initial amount of such
Investment so made and (y) the cash return of capital with respect to such
Investment less the cost of disposition, if any.

 

52

 

The amount expended in
any Restricted Payment, if other than in cash, will be deemed to be the Fair
Market Value of the relevant non-cash assets.

 

(b)                                 The
foregoing will not prohibit:

 

(1)                                  the
payment of any dividend within 60 days after the date of declaration thereof
if, at the date of declaration, such payment would comply with paragraph (a) of
this Section 4.06;

 

(2)                                  dividends
or distributions by a Restricted Subsidiary (A) payable, on a pro rata basis or
on a basis more favorable to the Company, to all holders of any class of
Capital Stock of such Restricted Subsidiary a majority of which is held,
directly or indirectly through Restricted Subsidiaries, by the Company or (B)
required to be paid by Martinez Cogen Limited Partnership in accordance with
the terms of its partnership agreement as in effect on the Issue Date;

 

(3)                                  the
repayment, redemption, repurchase, defeasance or other acquisition or retirement
of Subordinated Debt with the proceeds of, or in exchange for, Permitted
Refinancing Debt;

 

(4)                                  the
purchase, redemption or other acquisition or retirement for value of Equity
Interests of a Controlled Joint Venture (but only if it has continuing operations
and is not winding down) or a Joint Venture (or the acquisition of all the
outstanding Equity Interests of any person that conducts no material operations
and has no material assets or liabilities other than the ownership of Equity
Interests in a Joint Venture) in exchange for, or out of the proceeds of a
substantially concurrent offering of, Qualified Equity Interests of the Company
or of a cash contribution to the common equity of the Company;

 

(5)                                  the
repayment, redemption, repurchase, defeasance or other acquisition or
retirement of Subordinated Debt of the Company in exchange for, or out of the
proceeds of, a substantially concurrent offering of, Qualified Equity Interests
of the Company or of a cash contribution to the common equity of the Company;

 

(6)                                  any
Investment consisting of Guarantees permitted to be incurred pursuant to
Section 4.05(b)(8);

 

(7)                                  the
purchase, redemption or other acquisition or retirement for value of Equity
Interests of the Company or Parent held by officers, directors or employees or
former officers, directors or employees (or their estates or beneficiaries
under their estates), upon death, disability, retirement, severance or
termination of employment or pursuant to any agreement or employee benefit or
welfare plan under which the Equity Interests were issued; provided that the
aggregate cash consideration paid therefor in any fiscal year after
March 26, 2004 does not exceed an aggregate amount of $2,500,000;

 

(8)                                  Payments
to, or for the account of, any Parent Guarantor (to the extent such payment
constitutes a Restricted Payment) of (i) amounts to be used solely to pay
Federal, state and local (including any foreign) taxes during any period, in an
amount not

 

53

 

to exceed the amount of
taxes the Company and its Restricted Subsidiaries would pay on a stand alone
basis with respect to such period (had it been treated during such period and
all prior periods, together with its Restricted Subsidiaries, as a separate
taxpayer); provided that such amounts shall be used within 90 days of the
payment to Parent Guarantor to pay such taxes, (ii) amounts to be used within
90 days of the payment solely to pay reasonable corporate overhead and
management expenses in the ordinary course of business, relating to the
management of the Company and its Restricted Subsidiaries, pursuant to a
management agreement or otherwise, (iii) up to $2,000,000 per fiscal year to be
used to pay corporate overhead and management expenses not in the ordinary
course of business relating to the management of the Company and its Restricted
Subsidiaries pursuant to a management agreement or otherwise, and (iv) the
amount necessary to pay principal and any interest, when due, on the
Convertible Notes that remain outstanding after the Issue Date;

 

(9)                                  the
payment of cash dividends on any Disqualified Stock of the Company or a
Restricted Subsidiary or Preferred Stock of a Restricted Subsidiary existing on
March 26, 2004 or Incurred after March 26, 2004 in compliance with
paragraph (a) of Section 4.05;

 

(10)                            the
repurchase of any Subordinated Debt for a purchase price not greater than 101%
of the principal amount thereof in the event of (x) a change of control
pursuant to a provision no more favorable to the holders thereof than that
contained in Section 4.10 or (y) any Asset Sale pursuant to a provision no
more favorable to the holders thereof than that contained in Section 4.11;
provided
that, in each case, prior to the repurchase the Company has made an Offer to Purchase
and has repurchased all Notes issued under this Indenture that were validly
tendered for payment in connection with the offer to purchase;

 

(11)                            other
Restricted Payments in an aggregate principal amount not to exceed $25,000,000
after March 31, 2004;

 

(12)                            any
Investment made in exchange for, or out of the net cash proceeds of, a
substantially concurrent offering of Qualified Equity Interests of the Company
or a cash contribution to the common equity of the Company; and

 

(13)                            any
Investment in an Unrestricted Subsidiary in an aggregate amount not to exceed
$8,000,000;

 

(14)                            any
purchase by the Company or a Restricted Subsidiary from Parent of Common Stock
of Parent; provided
that the full consideration paid or delivered for such Common Stock
is immediately reinvested in the Company; provided further that such amount may be
further reinvested by the Company and thereafter may be reinvested by each
Subsidiary of the Company until it has been reinvested in the Restricted
Subsidiary that originally purchased such shares;

 

(15)                            the
proposed exchange offer and the transactions described in the Form S-4;
and

 

54

 

(16)                            the
repurchase, or payments to, or for the account of, any Parent Guarantor for the
repurchase, from time to time, of debt securities or trust securities of Foster
Wheeler LLC, its subsidiaries or any Parent Guarantor having a purchase price
in an amount not to exceed $50,000,000 in the aggregate.

 

provided that, in
the case of clauses (4), (5), (6), (7), (8)(iii) and (iv), (9), (10), (11),
(12), (13) and (16) of this Section 4.06(b), no Default has occurred and
is continuing or would occur as a result thereof.

 

(c)                                  Proceeds
of the issuance of Qualified Equity Interests will be included under clause
(3)(B) of Section 4.06(a) only to the extent they are not applied as
described in clause (4), (5), (12), (14) or (15) of Section 4.06(b).
Restricted Payments permitted pursuant to clause (2), (3), (4), (5), (6),
(8)(i), 8(ii) or (9) of Section 4.06(b) will not be included in making the
calculations under clause (3) of Section 4.06(a).  50% of all Restricted Payments made pursuant
to clause (16) of Section 4.06(b) will not be included in making the
calculations under clause (3) of this Section 4.06.

 

(d)                                 For
purposes hereof, any Investments made by the Company or any of its Restricted
Subsidiaries subsequent to March 26, 2004 shall be deemed to have been
made on the Issue Date (and, to the extent that such Investments would not have
been permitted to be made at such time under this Section 4.06, the
Company shall be deemed to be in breach of this Section 4.06).

 

Section 4.07.  Limitation
on Liens.  The Company
will not, and will not permit any Restricted Subsidiary to, directly or
indirectly, incur or permit to exist any Lien of any nature whatsoever on any
of its properties or assets, whether owned at the Issue Date or thereafter
acquired, or any proceeds, income or profits therefrom or assign or convey any
right to receive income therefrom, other than Permitted Liens, provided that
the foregoing shall not apply, with respect to any such property or assets
(other than the Collateral), to the extent that the Company or such Restricted
Subsidiary effectively provides that the Notes are secured equally and ratably
with (or, if the obligation to be secured by the Lien is subordinated in right
of payment to the Notes or any Note Guarantee, prior to) the obligations so
secured for so long as such obligations are so secured.

 

Section 4.08.  Limitation
on Sale and Leaseback Transactions.

 

The Company will not, and
will not permit any Restricted Subsidiary to, enter into any Sale and Leaseback
Transaction with respect to any property or asset, unless:

 

(A)                              the
Company or the Restricted Subsidiary would be permitted to Incur Debt in an
amount equal to the Attributable Debt with respect to such Sale and Leaseback
Transaction pursuant to Section 4.05;

 

(B)                                the
Company or the Restricted Subsidiary would be permitted to create a Lien on
such property or asset securing such Attributable Debt pursuant to
Section 4.07; and

 

55

 

(C)                                the
transfer of assets in the Sale and Leaseback Transaction is made in accordance
with Section 4.11.

 

Section 4.09.  Limitation
on Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries.

 

(a)                                  Except
as provided in Section 4.09(b), the Company will not, and will not permit
any Restricted Subsidiary to, directly or indirectly, create or otherwise cause
or permit to exist or become effective any consensual restriction of any kind
on the ability of any Restricted Subsidiary to:

 

(1)                                  pay
dividends or make any other distributions on any Equity Interests of such
Restricted Subsidiary owned by the Company or any other Restricted Subsidiary,

 

(2)                                  make
loans or advances to the Company or any other Restricted Subsidiary, or

 

(3)                                  transfer
any of its property or assets to the Company or any other Restricted
Subsidiary.

 

(b)                                 The
provisions of Section 4.09(a) do not apply to any encumbrances or restrictions:

 

(1)                                  existing
on the Issue Date in this Indenture, the Guarantees, the Collateral Documents
or any other agreements in effect on the Issue Date, and any extensions,
renewals, replacements or refinancings of any of the foregoing; provided
that the encumbrances and restrictions in the extension, renewal, replacement
or refinancing, taken as a whole, are not materially less favorable to the
Noteholders (as determined in the reasonable judgment of the Company) than the
encumbrances or restrictions being extended, renewed, replaced or refinanced;

 

(2)                                  existing
in the Credit Facilities;

 

(3)                                  existing
under or by reason of applicable law or governmental regulation;

 

(4)                                  existing
(A) with respect to any Person, or to the property or assets of any Person, at
the time the Person is acquired by the Company or any Restricted Subsidiary
(except to the extent such encumbrance was incurred in connection with or in
contemplation of such acquisition), or (B) with respect to any Unrestricted
Subsidiary at the time it is designated or is deemed to become a Restricted
Subsidiary, and, in each case, any extensions, renewals, replacements or
refinancings of any of the foregoing, provided the encumbrances and restrictions
in the extension, renewal, replacement or refinancing are, taken as a whole, no
less favorable in any material respect to the Noteholders (as determined in the
reasonable judgment of the Company) than the encumbrances or restrictions being
extended, renewed, replaced or refinanced;

 

(5)                                  of
the type described in clause (a)(3) of this Section 4.09 arising or agreed
to in the ordinary course of business (i) that restrict in a customary manner
the chartering,

 

56

 

subletting, assignment or
transfer of any property or asset that is subject to a lease or license (but
only to the extent that such restriction is imposed by the instruments pursuant
to which such lease or license is created), (ii) that restrict the transfer of
property or assets of the Company or any Restricted Subsidiary subject to a
Lien permitted under this Indenture (but only to the extent that such
restriction is imposed by the instruments pursuant to which such Lien, or the
obligation secured thereby, is created) or (iii) that restrict the transfer of
property or assets of the Company or any Restricted Subsidiary that is subject
to a merger agreement, stock or asset purchase agreement or similar agreement,
so long as any such transfer is otherwise permitted under this Indenture and
such restriction is imposed only during the period pending such disposition (so
long as such restriction does not continue for more than a customary period for
transactions of such type);

 

(6)                                  contained
in the terms governing any Debt (other than Trade Obligations) otherwise permitted
under this Indenture, if (as determined in the reasonable judgment of the
Company) the encumbrances or restrictions are necessary or required to enable
the Company or such Restricted Subsidiary to obtain or maintain a financing of
that type; or

 

(7)                                  set
forth in this Indenture, the Guarantees or any Collateral Document.

 

Section 4.10.  Repurchase
of Notes upon a Change of Control.  (a)  Not later than 30
days following a Change of Control, the Company will make an Offer to Purchase
all outstanding Notes at a purchase price equal to 101% of the principal amount
plus accrued and unpaid interest to the date of purchase.

 

(b)                                 The
Company will not be required to make an Offer to Purchase upon a Change of
Control if a third party makes the Offer to Purchase at the same time, at the
same premium and otherwise in compliance with the requirements applicable to an
Offer to Purchase made by the Company and purchases the Notes validly tendered
and not withdrawn under such Offer to Purchase.  The provisions of this Section 4.10 shall be applicable
regardless of whether the provisions of Article V are also applicable.

 

Section 4.11.  Limitation
on Asset Sales

 

(a)                                  The
Company will not, and will not permit any Restricted Subsidiary to, make any
Asset Sale unless the following conditions are met:

 

(1)                                  The
Asset Sale is for Fair Market Value.

 

(2)                                  At
least 75% of the consideration for such Asset Sale consists of cash or Cash
Equivalents received at closing. (For purposes of this clause (2), (x) the
assumption by the purchaser of (i) Debt or other obligations (other than
contingent liabilities and Subordinated Debt) of the Company or a Restricted
Subsidiary pursuant to a customary novation agreement that releases the Company
or such Restricted Subsidiary from any further liability, and (ii) instruments
or securities received from the purchaser that are promptly, but in any event
within 90 days of the closing, converted by the Company or such Restricted
Subsidiary to cash or Cash Equivalents, to the extent of the cash or Cash

 

57

 

Equivalents actually so
received, and (y) stock or assets of the kind referred to in clause (3)(B) of
this Section 4.11, shall each be considered cash received at closing.)

 

(3)                                  Within
12 months of the receipt of any Net Cash Proceeds from an Asset Sale, the Net
Cash Proceeds may be used

 

(A)                              to
permanently repay (i) senior secured Debt of the Company or any Restricted
Subsidiary (and in the case of a revolving credit, permanently reduce the
commitment thereunder by such amount), that is senior in respect of liens to
the Notes, (ii) Debt of any Restricted Subsidiary that is not a Guarantor that
makes an Asset Sale with the proceeds of such Asset Sale, in each case owing to
a Person other than the Company or any Restricted Subsidiary and required to be
prepaid from such Net Cash Proceeds, provided, that the Net Cash Proceeds from
an Asset Sale by the Company or any Restricted Subsidiary that is a Guarantor
shall be applied only to repay Debt of the Company or another Restricted
Subsidiary that is a Guarantor and (iii) Debt of the Company or any Restricted
Subsidiary ranking pari passu in respect of liens with the Notes so long as a
ratable repayment offer shall be made to the holders of the Notes, or

 

(B)                                to
acquire all or substantially all of the assets of, or a majority of the Voting
Stock of another Person that thereupon becomes a Restricted Subsidiary, to make
capital expenditures or otherwise acquire assets to be used or useful in the
business of the Company or any Restricted Subsidiary; provided that if the Company
or any Restricted Subsidiary contracts to acquire assets to make capital
expenditures with Net Cash Proceeds within the applicable 12-month period it
shall be deemed to have so applied such Net Cash Proceeds in accordance with
this subclause (B) if such Net Cash Proceeds are so applied within 24 months of
the applicable Asset Sale.

 

(4)                                  The
Net Cash Proceeds of an Asset Sale under this Section 4.11(a) not applied
pursuant to clause (3) of this Section 4.11(a) within the periods
specified constitute “Excess Proceeds”. Excess Proceeds of less than
$15,000,000 will be carried forward and accumulated. When accumulated Excess
Proceeds equals or exceeds $15,000,000, the Company must, within 30 days
thereafter, make an Offer to Purchase to all Holders of Notes and all holders
of other Debt that ranks pari passu with, or senior to, the Notes
containing provisions similar to those set forth in this Indenture with respect
to offers to purchase or redemption with the proceeds of sales of assets to
purchase the maximum principal amount of Notes and such other Debt that may be
purchased out of the Excess Proceeds on a pro rata basis. Upon completion of
the Offer to Purchase under this Section 4.11(a), Excess Proceeds will be
reset at zero, and any Excess Proceeds remaining after consummation of the
Offer to Purchase may be used for any purpose not otherwise prohibited by this
Indenture.

 

(b)                                 The
purchase price for the Notes for any offer under Section 4.11(a) will be
100% of the principal amount plus accrued interest to the date of purchase. If
the Offer to Purchase is for less than all of the outstanding Notes and Notes
in an aggregate principal amount in excess of the purchase amount are tendered
and not withdrawn pursuant to the offer, the Company will

 

58

 

purchase Notes having an aggregate principal amount
equal to the purchase amount on a pro rata basis along with such other pari passu
Debt with similar terms, with adjustments so that only Notes in multiples of
$1.00 principal amount will be purchased.

 

(c)                                  Pending
the final application of any Net Cash Proceeds, the Company and any Restricted
Subsidiary may temporarily reduce revolving credit borrowings or otherwise
invest the Net Cash Proceeds in any manner that is not prohibited by this
Indenture.

 

(d)                                 All
Net Cash Proceeds from an Event of Loss shall be invested as set forth in
Section 4.11(a)(3) and treated as Excess Proceeds under
Section 4.11(a)(4) and applied as set forth therein, all within the
periods and as otherwise provided in such clauses.

 

The Company will comply
with Rule 14e-1 under the Exchange Act and all other applicable laws in making
any Offer to Purchase, and the above procedures will be deemed modified as
necessary to permit such compliance.

 

Section 4.12.  Limitation
on Transactions with Affiliates

 

(a)                                  The
Company will not, and will not permit any Restricted Subsidiary to, directly or
indirectly, enter into, renew or extend any transaction or arrangement
including the purchase, sale, lease or exchange of property or assets, or the
rendering of any service with (x) any holder, or any Affiliate of any holder,
of 10% or more of the Voting Stock of Parent or (y) any Affiliate of either the
Company or any Restricted Subsidiary (a “Related Party Transaction”), except upon fair and
reasonable terms that are no less favorable to the Company or the Restricted
Subsidiary than could reasonably be obtained in a comparable arm’s-length
transaction with a Person that is not an Affiliate of the Company or any of its
Subsidiaries.

 

(b)                                 Prior
to entering into any Related Party Transaction or series of related Related
Party Transactions with an aggregate value in excess of $10,000,000, the
Company must deliver to the Trustee a resolution certifying that such Related
Party Transaction complies with clause (a) of this Section 4.12 and
that such Related Party Transaction has been approved by resolution of not less
than a majority of the Board of Directors of Parent who are disinterested in
the subject matter of the transaction. Prior to entering into any Related Party
Transaction or series of Related Party Transactions with an aggregate value in
excess of $15,000,000, the Company must in addition to the requirements of the
immediately preceding sentence obtain and deliver to the Trustee a favorable
written opinion from a nationally recognized investment banking firm as to the
fairness of the transaction to the Company and its Restricted Subsidiaries from
a financial point of view.

 

(c)                                  The
foregoing paragraphs (a) and (b) of this Section 4.12 do not apply to

 

(1)                                  any
transaction between the Company and any of its Restricted Subsidiaries or
between Restricted Subsidiaries of the Company;

 

(2)                                  the
payment of reasonable and customary regular fees to directors of the Company
who are not employees of the Company;

 

59

 

(3)                                  any
Restricted Payments and any contracts relating thereto of a type described in
one of paragraphs (i), (ii) or (iii) of Section 4.06(a) if permitted by
said Section 4.06(a), and any Permitted Investment; provided that any such
Permitted Investment described in clauses (3), (4), (5), (7), (8), (9), (12) or
(14) of the definition of Permitted Investments is made upon fair and
reasonable terms that are no less favorable to the Company or the Restricted
Subsidiary than could reasonably be obtained in a comparable arm’s length
transaction;

 

(4)                                  transactions
or payments pursuant to any employee, officer or director compensation or
benefit plans or arrangements entered into in the ordinary course of business,
and loans and advances to employees or consultants and Guarantees that
constitute Permitted Investments pursuant to clause (11) of the definition of that
term;

 

(5)                                  transactions
entered into as part of a Permitted Receivables Financing;

 

(6)                                  transactions
pursuant to any contract or agreement in effect on the Issue Date, as any such
contract or agreement may be amended, modified or replaced (including successive
replacements) from time to time, so long as the amended, modified or new
contract or agreement, taken as a whole, is no less favorable to the Company
and its Restricted Subsidiaries than the contract or agreement being amended,
modified or replaced, as in effect on the Issue Date;

 

(7)                                  transactions
with customers, clients, suppliers or purchasers or sellers of goods or
services, in each case in the ordinary course of business and otherwise in
compliance with this Indenture, which are fair to the Company or its Restricted
Subsidiaries, or are on terms, taken as a whole, at least as favorable as could
reasonably have been obtained in a comparable arm’s length transaction; or

 

(8)                                  Performance
guarantees (including under engineering, procurement or construction contracts
or otherwise) entered into in the ordinary course of business with respect to
Unrestricted Subsidiaries and Joint Ventures.

 

Section 4.13.  Additional
Note Guarantees and Collateral After the Issue Date

 

(a)                                  If
any Domestic Subsidiary (other than a Subsidiary that is designated an
Unrestricted Subsidiary) is formed or acquired or any Subsidiary becomes a
Domestic Subsidiary (other than a Subsidiary that is designated an Unrestricted
Subsidiary), in each case after the Issue Date, the Company will as promptly as
practicable (but in no event later than 10 Business Days after such formation
or acquisition) cause the Subsidiary to deliver a Note Guarantee by executing a
supplemental indenture in the form of Exhibit C to this Indenture and to pledge
its assets as required by the Collateral Documents and this Indenture; provided
that no Non-Wholly Owned Subsidiary shall be required to execute a Note
Guarantee or pledge its assets to the extent it is prevented from doing so
under the terms of its organizational documents.

 

(b)                                 If
the Company or any Guarantor shall acquire after the Issue Date any real or
personal property that is required to become Collateral under the terms of the
Collateral Documents, the Company or such Guarantor shall, as promptly as
practicable (but in no event later than 10 Business Days after such
acquisition, in the case of domestic Collateral, or 60 days

 

60

 

after such acquisition, in the case of foreign
Collateral, and in any event no later than the date on which the actions
described in clauses (i) and (ii) of this paragraph are completed to secure any
Credit Facility) (i) execute and deliver such mortgages, pledge agreements,
other security instruments and financing statements as shall be necessary to
cause such property to become Collateral subject to the Lien of the Collateral
Documents for the benefit of the Noteholders, subject to Permitted Liens and
other exceptions applicable to the Collateral on the Issue Date and (ii) cause
to be delivered one or more Opinions of Counsel substantially to the effect of
the matters referred to in clause (i), provided that the foregoing shall not
apply as to any property having a fair market value of less than $1,000,000.

 

(c)                                  Notwithstanding
clauses (a) and (b) above, after the Issue Date, (i) if any Restricted
Subsidiary, other than an Excepted Non-Guarantor Subsidiary, concurrently
provides a guarantee under the Credit Agreement or any Credit Facility
permitted under Section 4.05(b)(1) such Restricted Subsidiary shall be
required to execute a Note Guarantee or (ii) if the Company or any of its
Restricted Subsidiaries grants a Lien upon any of its property or assets to
secure any Credit Facility permitted under Section 4.05(b)(1) the respective
grantor shall concurrently grant a Lien equivalent in scope as collateral
security for the Notes.

 

(d)                                 No
Excepted Non-Guarantor Subsidiary:

 

(1)                                  may
Incur any Debt (other than refinancing of Debt outstanding on March 26,
2004) except intercompany Debt as permitted below in Section 4.13(e);

 

(2)                                  may
engage in any line of business other than that in which it was engaged on
March 26, 2004; or

 

(3)                                  sell
any of its assets (other than to the Company or any Guarantor), or acquire any
assets from any other Person, other than in the ordinary course of its
business,

 

unless and until such
Excepted Non-Guarantor Subsidiary executes a Note Guarantee, after which time
it will no longer be considered an Excepted Non-Guarantor Subsidiary. In
addition, neither the Company nor any of its Restricted Subsidiaries shall make
any Investment (including in the form of loans) in Excepted Non-Guarantor
Subsidiaries after March 26, 2004 other than Investments that, in the
aggregate as to all Excepted Non-Guarantor Subsidiaries, do not exceed
$2,000,000.

 

(e)                                  After
the Issue Date, Foster Wheeler Europe Limited shall (i) continue to hold 100%
of the Capital Stock of Foster Wheeler Limited (England) and Foster Wheeler
Continental Europe S.r.l.; provided that Foster Wheeler Continental
Europe S.r.l. shall be permitted to merge into one of its Subsidiaries so long
as following such merger, Foster Wheeler Europe Limited directly holds 100% of
the surviving entity and (ii) not Incur any additional Debt (other than
intercompany Debt owed to either of the Subsidiaries listed in clause (i) of
this paragraph) or Liens, make any Investments, transfer any assets (other than
to the Company or any Guarantor) or otherwise engage in any activity other than
(A) the ownership of the two Subsidiaries listed in clause (i) of this
paragraph, or (B) the ownership of Capital Stock of any other Subsidiaries
distributed to it by its Subsidiaries.

 

61

 

(f)                                    In
the event that the Excepted Non-Guarantor Subsidiaries do not execute all Note
Guarantees and pledge their assets in accordance with the Collateral Documents
to secure their Note Guarantees within 90 days of the Issue Date, the interest
rate on the Notes shall increase to [rate plus 1.0]% per annum, commencing on
the 91st day
following the Issue Date through and until the date on which all such Note
Guarantees have been executed and pledges documented in accordance with the
Collateral Documents, after which the interest rate shall decrease to [    ]%.

 

Section 4.14.  Designation
of Restricted and Unrestricted Subsidiaries

 

(a)                                  By
resolution of the board of directors of the Company, the Company may designate
any Subsidiary, including a newly acquired or created Subsidiary, to be an
Unrestricted Subsidiary if it meets the following qualifications and the
designation would not cause a Default:

 

(1)                                  (A)
The Subsidiary does not own any Disqualified Stock or Debt of the Company or
Disqualified, Debt or Preferred Stock of a Restricted Subsidiary or hold any
Lien on any property of, the Company or any Restricted Subsidiary, if such
Disqualified or Preferred Stock or Debt could not be Incurred under
Section 4.05 or such Lien would violate Section 4.07; and

 

(B)                                the
Subsidiary does not own any Voting Stock of a Restricted Subsidiary, and all of
its Subsidiaries are Unrestricted Subsidiaries.

 

(2)                                  At
the time of the designation, the Company would be permitted to make a
Restricted Payment under Section 4.06 in an amount equal to the Fair
Market Value of the Investment in such Subsidiary.

 

(3)                                  Such
Subsidiary has no Debt outstanding other than Non-Recourse Debt.

 

(4)                                  The
Subsidiary is not party to any ongoing transaction or arrangement with the
Company or any Restricted Subsidiary that would not be permitted under
Section 4.12.

 

Once so designated the
Subsidiary will remain an Unrestricted Subsidiary, subject to paragraph (b) of
this Section 4.14.

 

(b)                                 (1)                                  A
Subsidiary previously designated an Unrestricted Subsidiary which fails at any
time to meet the qualifications set forth in Section 4.14(a) will be
deemed to become at that time a Restricted Subsidiary, subject to the
consequences set forth in Section 4.14(d).

 

(2)                                  The
Board of Directors of the Company may designate an Unrestricted Subsidiary to
be a Restricted Subsidiary if the designation would not cause a Default or
Event of Default.

 

(c)                                  Upon
a Restricted Subsidiary becoming an Unrestricted Subsidiary:

 

(1)                                  all
existing Investments of the Company and the Restricted Subsidiaries therein
(valued at the Company’s proportional share of the Fair Market Value of its
assets less liabilities) will be deemed made at that time;

 

62

 

(2)                                  all
existing Capital Stock or Debt of the Company or a Restricted Subsidiary held
by such Unrestricted Subsidiary will be deemed Incurred at that time, and all
Liens on property of the Company or a Restricted Subsidiary held by such
Unrestricted Subsidiary will be deemed Incurred at that time;

 

(3)                                  all
existing transactions between such Unrestricted Subsidiary and the Company or
any Restricted Subsidiary will be deemed entered into at that time;

 

(4)                                  such
Unrestricted Subsidiary will be released at that time from its Note Guarantee,
if any; and

 

(5)                                  such
Unrestricted Subsidiary will cease to be subject to the provisions of this
Indenture as a Restricted Subsidiary.

 

(d)                                 Upon
an Unrestricted Subsidiary becoming, or being deemed to become, a Restricted
Subsidiary:

 

(1)                                  all
of its Debt and Disqualified or Preferred Stock will be deemed Incurred at that
time for purposes of Section 4.05, but will not be considered the sale or
issuance of Equity Interests for purposes of Section 4.11;

 

(2)                                  Investments
therein previously charged under the Section 4.06 will be credited
thereunder;

 

(3)                                  it
may be required to issue a Note Guarantee pursuant to Section 4.13; and

 

(4)                                  it
will become subject to the provisions of this Indenture as a Restricted
Subsidiary.

 

(e)                                  Any
designation by the Board of Directors of the Company of a Subsidiary as a
Restricted Subsidiary or Unrestricted Subsidiary will be evidenced to the
Trustee by promptly filing with the Trustee a copy of the Board Resolution
giving effect to the designation and an Officers’ Certificate certifying that
the designation complied with the foregoing provisions.

 

Section 4.15.  Financial
Reports

 

(a)                                  Whether
or not the Company is subject to the reporting requirements of Section 13
or 15(d) of the Exchange Act, the Company must provide the Trustee and Holders
of the Notes within the time periods specified in those sections with:

 

(1)                                  all
quarterly and annual financial information that would be required to be
contained in a filing with the Commission on Forms 10-Q and 10-K if the Company
were required to file such forms, including a “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” and, with respect to
annual information only, a report thereon by the Company’s certified
independent accountants, provided that the Company shall not be
required to provide separate audited financials of the Guarantors under this or
any other provision of this Indenture, provided that, for so long

 

63

 

as the Company is a
consolidated subsidiary of Parent, Foster Wheeler may satisfy this obligation
by delivering such information with respect to Parent; and

 

(2)                                  all
current reports that would be required to be filed with the Commission on Form
8-K if the Company were required to file such reports, provided that, for so long
as the Company is a consolidated subsidiary of Parent, the Company may satisfy
this obligation by delivering all such current reports of Parent.

 

(b)                                 In
addition, whether or not required by the Commission, the Company will file a
copy of all of the information and reports referred to in Sections 4.15(a)(1)
and (2) (and subject to the provisos contained in such clauses) with the
Commission (to the extent permitted by the Commission) within the applicable
time periods had such information been required to be filed. the Company will
make such information available to the Trustee and the holders of the Notes
within such time periods.

 

(c)                                  If
the Company has designated any of its Subsidiaries as Unrestricted
Subsidiaries, then it shall deliver to the Trustee, on or before the 10th
Business Day following each of the dates on which quarterly or annual financial
information is required to be filed with the Commission under
Section 4.15(a)(1), a certificate setting forth a balance sheet and a
statement of operations and comprehensive loss of the Company and its
Restricted Subsidiaries separate from the Unrestricted Subsidiaries for the
same periods covered by the reports required to be filed under
Section 4.15(a)(1).

 

Section 4.16.  Reports to
Trustee

 

The Company will deliver
to the Trustee:

 

(1)                                  within
90 days after the end of each fiscal year a certificate stating that the
Company has fulfilled in all material respects its obligations under this
Indenture or, if there has been a Default during such fiscal year, specifying
the Default and its nature and status; and

 

(2)                                  as
soon as possible and in any event within 30 days after responsible officers of
the Company become aware of the occurrence of a Default, an Officers’
Certificate setting forth the details of the Default, and the action which the
Company proposes to take with respect thereto.

 

Section 4.17.  Impairment
of Security Interest; Security Document Covenants.  The Company and the Parent Guarantors will
not, and will not permit any of its Subsidiary Guarantors to, take any action,
or knowingly or negligently omit to take any action, which action or omission
might or would have the result of materially impairing the security interest
with respect to the Collateral for the benefit of the Noteholders.  Any release of Collateral in accordance with
the provisions of this Indenture and the Collateral Documents will not be
deemed to impair the security under this Indenture.

 

64

 

ARTICLE 5

CONSOLIDATION, MERGER OF SALE OF ASSETS

 

Section 5.01.  Consolidation,
Merger or Sale of Assets by the Company; No Lease of All or Substantially All
Assets.

 

(a)                                  The
Company will not, in a single transaction or a series of related transactions:

 

(i)                                     consolidate,
amalgamate with or merge with or into any Person or group of Affiliated
Persons,

 

(ii)                                  sell,
assign, convey, transfer, or otherwise dispose of all or substantially all of
its assets as an entirety or substantially an entirety, in one transaction or a
series of related transactions, to any Person or group of Affiliated Persons,
or permit any of its Restricted Subsidiaries to enter into any such transaction
or related transactions if such transaction or transactions, in the aggregate,
would result in the sale, assignment, conveyance, transfer or disposition of
all or substantially all of the assets of the Company and its Restricted
Subsidiaries, taken as a whole, to any Person or group of Affiliated Persons,
or

 

(iii)                               permit
any Person to merge with or into the Company, unless:

 

(1)                                  either
(x) the Company is the continuing Person or (y) the resulting, surviving or
transferee Person is a corporation or limited liability company organized and
validly existing under the laws of the United States of America, any State of
the United States of America or the District of Columbia or Bermuda and
expressly assumes by supplemental indenture all of the obligations of the
Company under this Indenture, the Notes and the Collateral Documents;

 

(2)                                  immediately
before and immediately after giving pro forma effect to the transaction or series
of transactions, no Default or Event of Default has occurred and is continuing;

 

(3)                                  immediately
after giving effect to the transaction on a pro forma basis, (a) the Company or
the resulting surviving Person or transferee on a consolidated basis has a Consolidated
Net Worth immediately after the transaction equal to or greater than the
Consolidated Net Worth of the Company on a consolidated basis immediately prior
to such transaction and (b) the Company or the resulting surviving or
transferee Person could Incur at least $1.00 of Debt under
Section 4.05(a); and

 

(4)                                  the
Company delivers to the Trustee an Officers’ Certificate and an Opinion of
Counsel, each stating that the consolidation, merger or transfer and the
supplemental indenture (if any) comply with this Indenture;

 

provided, that Sections 5.01(2) through
(4) do not apply (i) to the consolidation or merger of the Company with or into
a Restricted Subsidiary or the consolidation or merger of a Restricted
Subsidiary with or into the Company or (ii) if, in the good faith determination
of the board of

 

65

 

directors of the Company,
whose determination is evidenced by a Board Resolution, the purpose of the
transaction is to change the jurisdiction of incorporation of the Company.

 

(b)                                 Neither
the Company nor any Restricted Subsidiary shall lease all or substantially all
of the assets of the Company and its Restricted Subsidiaries taken as a whole,
whether in one transaction or a series of related transactions, to one or more
other Persons.

 

(c)                                  Upon
the consummation of any transaction effected in accordance with these
provisions, if the Company is not the continuing Person, the resulting,
surviving or transferee Person will succeed to, and be substituted for, and may
exercise every right and power of, the Company under this Indenture, the
Registration Rights Agreement and the Notes with the same effect as if such
successor Person had been named as the Company in such documents. Upon such
substitution, and except in the case of a sale, conveyance, transfer or
disposition of less than all its assets to one or more Persons, the Company
will be released from its obligations under this Indenture, Collateral
Documents, the Registration Rights Agreement, and the Notes.

 

Section 5.02.  Merger by
Subsidiary Guarantors.

 

No Subsidiary Guarantor
may merge with or into any Person unless:

 

(x)                                   the
merger constitutes a sale or other disposition (including by way of merger or
consolidation) of the Guarantor and is made in accordance with
Section 4.11, or

 

(y)                                 either
(i) such Guarantor is the continuing Person or (ii) (A) the resulting or
surviving Person is organized and validly existing under the laws of the United
States of America, any state of the United States of America or the District of
Columbia, Bermuda or the jurisdiction of organization of such Guarantor prior
to the merger and expressly assumes by supplemental indenture all of the
obligations of such Guarantor under this Indenture, the Note Guarantee and the
Collateral Documents; and (B) the Guarantor delivers to the Trustee an
Officers’ Certificate and an Opinion of Counsel, each stating that the
consolidation or merger and the supplemental indenture comply with this
Indenture; provided that no such certificate or opinion shall be required for a
consolidation or merger of a Guarantor with or into another Guarantor).

 

ARTICLE 6

DEFAULT AND REMEDIES

 

Section 6.01.  Events of
Default.  An “Event of Default”
occurs if

 

(1)                                  the
Company defaults in the payment of the principal of or premium, if any, on any
Note when the same becomes due and payable at its Stated Maturity, upon
acceleration or redemption, or otherwise;

 

(2)                                  the
Company defaults in the payment of interest on any Note when the same becomes
due and payable, and the default continues for a period of 30 days;

 

66

 

(3)                                  the
Company fails to make an Offer to Purchase and thereafter accept and pay for
Notes tendered when and as required pursuant to Sections 4.10 or 4.11, or
the Company fails to comply with the provisions of Section 5.01;

 

(4)                                  the
Company or any of its Restricted Subsidiaries defaults in the performance of or
breaches any other covenant or agreement in this Indenture or under the Notes
or the Collateral Documents, and the default or breach continues for a period
of 60 consecutive days after delivery of written notice to the Company by the
Trustee or to the Company and the Trustee by the holders of 25% or more in
aggregate principal amount of the Notes;

 

(5)                                  there
occurs with respect to any Debt of the Company or any of its Significant
Restricted Subsidiaries having an outstanding principal amount of $15,000,000
or more in the aggregate for all such Debt of all such Persons (i) an event of
default that results in such Debt being due and payable prior to its scheduled
maturity or (ii) failure to make a principal payment when due and such
defaulted payment is not made, waived or extended within the applicable grace
period;

 

(6)                                  one
or more final judgments or orders of any court or courts for the payment of
money are rendered against the Company or any of its Significant Restricted
Subsidiaries and are not paid or discharged, settled or fully bonded and there
is a period of 60 consecutive days following entry of the final judgment or
order that causes the aggregate amount for all such final judgments or orders
outstanding and not paid or discharged against all such Persons to exceed
$15,000,000 (in excess of amounts which the Company’s insurance carriers have agreed
to pay under applicable policies) during which a stay of enforcement, by reason
of a pending appeal or otherwise, is not in effect;

 

(7)                                  an
involuntary case or other proceeding is commenced against the Company, Parent,
any Significant Restricted Subsidiary or any group of Restricted Subsidiaries
that taken together would constitute a Significant Restricted Subsidiary, with
respect to it or its debts under any bankruptcy, insolvency or other similar
law now or hereafter in effect seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial part
of its property, and such involuntary case or other proceeding remains
undismissed and unstayed for a period of 60 days; or an order for relief is
entered against the Company, Parent, any Significant Restricted Subsidiary or
any group of Restricted Subsidiaries that taken together would constitute a
Significant Restricted Subsidiary under the U.S. federal bankruptcy laws as now
or hereafter in effect;

 

(8)                                  the
Company, Parent, any Significant Restricted Subsidiary or any group of
Restricted Subsidiaries that taken together would constitute a Significant
Restricted Subsidiary (i) commences a voluntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, or
consents to the entry of an order for relief in an involuntary case under any
such law, (ii) consents to the appointment of or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official of the Company, Parent, any Significant Restricted Subsidiary or any
group of Restricted Subsidiaries that taken together would constitute a
Significant

 

67

 

Restricted Subsidiary, or
for all or substantially all of the property and assets of the Company, Parent,
any Significant Restricted Subsidiary or any group of Restricted Subsidiaries
that taken together would constitute a Significant Restricted Subsidiary or
(iii) effects any general assignment for the benefit of creditors;

 

(9)                                  any
Note Guarantee ceases to be in full force and effect, other than in accordance
with the terms of this Indenture or a Guarantor denies or disaffirms its
obligations under its Note Guarantee; or

 

(10)                            with
respect to any Collateral having an aggregate fair market value of $15,000,000
or more, (A) the security interest under the Collateral Documents, at any time,
ceases to be in full force and effect or is unenforceable for any reason other
than in accordance with the terms of this Indenture or the Collateral Documents
and other than in satisfaction in full of the obligations under this Indenture
and discharge of this Indenture, and such ineffectiveness continues for a
period of 30 consecutive days after delivery of written notice to the Company
by the Trustee or to the Company and the Trustee by the holders of 25% or more
in aggregate principal amount of the Notes, or (B) the Company or any
Restricted Subsidiary asserts in writing that any such security interest is
invalid or unenforceable.

 

Section 6.02.  Consequences
of an Event of Default.

 

(a)                                  If
an Event of Default, other than a bankruptcy default described in
Sections 6.01(7) or (8) with respect to the Company, Parent, any
Significant Restricted Subsidiary or group of Restricted Subsidiaries that
taken together would constitute a Significant Restricted Subsidiary, occurs and
is continuing under this Indenture, the Trustee or the Holders of at least 25%
in aggregate principal amount of the Notes then outstanding, by written notice
to the Company (and to the Trustee if the notice is given by the Holders), may,
and the Trustee at the request of such Holders shall, declare the principal of
premium, if any, and accrued interest on the Notes to be immediately due and
payable. Upon a declaration of acceleration, such principal of, premium, if
any, and interest will become immediately due and payable. If a bankruptcy
default described in Sections 6.01(7) or (8) occurs with respect to the
Company, Parent, any Significant Restricted Subsidiary or any group of
Restricted Subsidiaries that taken together would constitute a Significant
Restricted Subsidiary, the principal premium, if any, of and accrued interest
on the Notes then outstanding will become immediately due and payable without
any declaration or other act on the part of the Trustee or any Holder.

 

(b)                                 The
Holders of a majority in principal amount of the outstanding Notes by written
notice to the Company and to the Trustee may waive all existing and past Defaults
and Events of Default and rescind and annul a declaration of acceleration and
its consequences if

 

(1)                                  all
existing Defaults and Events of Default, other than the nonpayment of the
principal of, premium, if any, and interest on the Notes other than any such
Defaults or Events of Default that have become due solely by the declaration of
acceleration, have been cured or waived, and

 

68

 

(2)                                  the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction.

 

Section 6.03.  Other Remedies. 
If an Event of Default occurs and is continuing, the Trustee may pursue,
in its own name or as Trustee of an express trust, any available remedy by
proceeding at law or in equity to collect the payment of principal of, 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.  Except as
otherwise provided in Sections 6.02, 6.07, and 9.02 the Holders of a
majority in principal amount of the outstanding Notes may, by notice to the
Trustee, waive an existing Default and its consequences. Upon such waiver, the
Default will cease to exist, and any Event of Default arising therefrom will be
deemed to have been cured, but no such waiver will extend to any subsequent or
other Default or impair any right consequent thereon.

 

Section 6.05.  Control by
Majority.  The Holders of
a majority in principal amount of the outstanding Notes may direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on the Trustee. However, the
Trustee may refuse to follow any direction that conflicts with law or this
Indenture, that may involve the Trustee in personal liability, and may take any
other action it deems proper that is not inconsistent with any such direction
received from Holders of Notes.

 

Section 6.06.  Limitation
on Suits.  A Holder may
not institute any proceeding, judicial or otherwise, with respect to this
Indenture or the Notes, or for the appointment of a receiver or trustee, or for
any other remedy under this Indenture or the Notes, unless:

 

(1)                                  the
Holder has previously given to the Trustee written notice of a continuing Event
of Default;

 

(2)                                  Holders
of at least 25% in aggregate principal amount of outstanding Notes have made
written request to the Trustee to institute proceedings in respect of the Event
of Default in its own name as Trustee under this Indenture;

 

(3)                                  such
Holder or Holders have offered to the Trustee indemnity reasonably satisfactory
to the Trustee against any costs, liabilities or expenses to be Incurred in
compliance with such request;

 

(4)                                  the
Trustee, for 60 days after its receipt of such notice, request and offer of
indemnity has failed to institute any such proceeding; and

 

(5)                                  during
such 60-day period, the Holders of a majority in aggregate principal amount of
the outstanding Notes have not given the Trustee a direction that is
inconsistent with such written request.

 

69

 

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 to Receive Payment. 
Notwithstanding anything to the contrary, the right of a Holder of a
Note to receive payment of principal of, premium, if any, or interest on its
Note on or after the Stated Maturities thereof, or to bring suit for the
enforcement of any such payment on or after such dates, may not be impaired or
affected without the consent of that Holder.

 

Section 6.08.  Collection
Suit by Trustee.  If an
Event of Default in payment of principal or interest specified in clause (1) or
(2) of Section 6.01 occurs and is continuing, the Trustee may recover
judgment in its own name and as trustee of an express trust for the whole
amount of principal and accrued interest remaining unpaid, together with
interest on overdue principal and overdue installments of interest, in each
case at the rate specified in the Notes, and such further amount as is
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel and any other amounts due the Trustee hereunder.

 

Section 6.09.  Trustee May
File Proofs of Claim. 
The Trustee may file 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 compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel, and any other amounts due the Trustee
hereunder) and the Holders allowed in any judicial proceedings relating to the
Company or any Guarantor or their respective creditors or property, and is
entitled and empowered to collect, receive and distribute any money, securities
or other property payable or deliverable upon conversion or exchange of the
Notes or upon any such claims.  Any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, if the Trustee consents 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 agent and counsel, and any other amounts due the
Trustee hereunder.  Nothing in this
Indenture will be deemed to empower 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 thereof, 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 or property pursuant to this Article VI, or
the Trustee or the Notes Collateral Agent collects any amounts pursuant to any
Collateral Document, then, subject to the Intercreditor Agreement with respect
to proceeds of any Collateral at any time received or held by the Trustee or
the Notes Collateral Agent, such amounts shall be paid in the following order:

 

First:  to the Trustee, its agents and attorneys for
amounts due and payable under Section 7.07, including payment of all
compensation, expense and liabilities incurred, and all advances made, by the
Trustee and the costs and expenses of collection;

 

70

 

Second:  to pay the principal of, and interest and
premium, if any, on the Notes, in each case ratably, without preference or
priority of any kind; and

 

Third:  to the Obligors or to such party as a court
of competent jurisdiction shall direct.

 

The Trustee, upon written
notice to the Company, may fix a record date and payment date for any payment
to Holders pursuant to this Section.

 

Section 6.11.  Restoration
of Rights and Remedies. 
If the Trustee or any Holder has instituted a proceeding to enforce any
right or remedy under this Indenture and the proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to the Trustee or
to the Holder, then, subject to any determination in the proceeding, the
Company, any Guarantors, the Trustee and the Holders will be restored severally
and respectively to their former positions hereunder and thereafter all rights
and remedies of the Company, any Guarantors, the Trustee and the Holders will
continue as though no such proceeding had been instituted.

 

Section 6.12.  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 not in its individual
capacity but solely as Trustee, a court may require any party litigant in such
suit (other than the Trustee) to file an undertaking to pay the costs of the
suit, and the court may assess reasonable costs, including reasonable attorneys
fees and expenses, against any party litigant (other than the Trustee) in the
suit, having due regard to the merits and good faith of the claims or defenses
made by the party litigant.  This
Section 6.12 does not apply to a suit by a Holder to enforce payment of
principal of or interest on any Note on the respective due dates, or a suit by
Holders of more than 10% in principal amount of the outstanding Notes.

 

Section 6.13.  Rights and
Remedies Cumulative.  No
right or remedy conferred or reserved to the Trustee or to the Holders under
this Indenture is intended to be exclusive of any other right or remedy, and
all such rights and remedies are, to the extent permitted by law, cumulative
and in addition to every other right and remedy hereunder or now or hereafter
existing at law or in equity or otherwise. 
The assertion or exercise of any right or remedy hereunder, or
otherwise, will not prevent the concurrent assertion or exercise of any other
appropriate right or remedy.

 

ARTICLE 7

THE TRUSTEE

 

Section 7.01.  General.  (a) The
duties and responsibilities of the Trustee are as provided by the TIA and as
set forth herein.  Whether or not
expressly so provided, every provision of this Indenture relating to the
conduct or affecting the liability of or affording protection to the Trustee is
subject to this Article 7.

 

(b)                                 Except
during the continuance of an Event of Default, the Trustee and Notes Collateral
Agent need perform only those duties that are specifically set forth in this
Indenture or the Collateral Documents and no others, and no implied covenants
or obligations will be read into this Indenture or the Collateral Documents
against the Trustee and Notes Collateral Agent.

 

71

 

In case an Event of Default has occurred and is
continuing, the Trustee or Notes Collateral Agent shall exercise those rights
and powers vested in it by this Indenture or the Collateral Documents, and use
the same degree of care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs.

 

(c)                                  No
provision of this Indenture shall be construed to relieve the Trustee from
liability for its own gross negligent action, its own negligent failure to act
or its own willful misconduct.

 

Section 7.02.  Certain
Rights of Trustee. 
Subject to Trust Indenture Act Sections 315(a) through (d):

 

(1)                                  The
Trustee may conclusively rely, and will be protected in acting or refraining
from acting, upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note,
other evidence of indebtedness or other paper or 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, but, in the case of any document which is
specifically required to be furnished to the Trustee pursuant to any provision
hereof, the Trustee shall examine the document to determine whether it conforms
to the requirements of this Indenture (but need not confirm or investigate the
accuracy of mathematical calculations or other facts stated therein).  The Trustee, in its discretion, may make
further inquiry or investigation into such facts or matters as it sees fit.

 

(2)                                  Before
the Trustee acts or refrains from acting on a request or direction from the
Company, it may require an Officers’ Certificate or an Opinion of Counsel
conforming to Section 12.05 and the Trustee will not be liable for any
action it takes or omits to take in good faith in reliance on the certificate
or opinion.

 

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

 

(4)                                  Notwithstanding
any other provision of this Indenture, 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 security or indemnity satisfactory to it against the
costs, expenses and liabilities that might be incurred by it in compliance with
such request or direction.

 

(5)                                  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 its rights or powers or for
any action it takes or omits to take in accordance with the direction of the
Holders in accordance with Section 6.05 relating to the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this Indenture.

 

(6)                                  The
Trustee may consult with counsel, and the advice of such counsel or any Opinion
of Counsel will be full and complete authorization and protection in respect

 

72

 

of any action taken,
suffered or omitted by it hereunder in good faith and in reliance thereon.

 

(7)                                  No
provision of this Indenture will require the Trustee to expend or risk its own
funds or otherwise incur any financial liability in the performance of its
duties hereunder, or in the exercise of its rights or powers, unless it
receives indemnity satisfactory to it against any loss, liability or expense.

 

(8)                                  The
Trustee shall not be liable for any action taken, suffered, or omitted to be
taken by it in good faith and reasonably believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this Indenture.

 

(9)                                  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.

 

(10)                            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, and such notice references the
Notes and this Indenture.

 

(11)                            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
(including, for the avoidance of doubt, its capacity as Notes Collateral Agent,
if applicable), and each agent, custodian and other Person employed to act
hereunder.

 

(12)                            The
Trustee may request that the Company deliver an Officers’ Certificate setting
forth the names of individuals and/or titles of officers authorized at such
time to take specified actions pursuant to this Indenture, which Officers’
Certificate may be signed by any Person authorized to sign an Officers’ Certificate,
including any Person specified as so authorized in any such certificate
previously delivered and not superseded.

 

Section 7.03.  Trustee May
Hold Notes.  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 its Affiliates with the same
rights it would have if it were not the Trustee.  Any Agent may do the same with like rights.  However, the Trustee is subject to TIA
Sections 310(b) and 311.  For purposes
of TIA Section 311(b)(4) and (6):

 

(a)                                  “cash
transaction” means any transaction in which full payment for goods
or securities sold is made within seven days after delivery of the goods or
securities in currency or in checks or other orders drawn upon banks or bankers
and payable upon demand; and

 

(b)                                 “self-liquidating
paper” means any draft, bill of exchange, acceptance or obligation
which is made, drawn, negotiated or incurred for the purpose of financing the
purchase, processing, manufacturing, shipment, storage or sale of goods, wares
or merchandise

 

73

 

and which is secured by documents evidencing title to,
possession of, or a lien upon, the goods, wares or merchandise or the
receivables or proceeds arising from the sale of the goods, wares or
merchandise previously constituting the security, provided the security is
received by the Trustee simultaneously with the creation of the creditor
relationship arising from the making, drawing, negotiating or incurring of the
draft, bill of exchange, acceptance or obligation.

 

Section 7.04.  Trustee’s
Disclaimer.  The Trustee
(i) makes no representation as to the validity or adequacy of this Indenture,
the Notes or the Collateral Documents, (ii) is not accountable for the Company’s
use or application of the proceeds from the Notes and (iii) is not responsible
for any statement in a Note other than its certificate of authentication.

 

Section 7.05.  Notice of
Default.  If any Default
occurs and is continuing and is known to the Trustee, the Trustee will send
notice of the Default to each Holder within 60 days after obtaining knowledge
thereof, unless the Default has been cured or waived; provided that, except in
the case of a default in the payment of the principal of or interest on any
Note, the Trustee may withhold the notice if and so long as the Trustee in good
faith determines that withholding the notice is in the interest of the
Holders.  Notice to Holders under this
Section 7.05 will be given in the manner and to the extent provided in the
TIA Section 313(c).

 

Section 7.06.  Reports by
Trustee to Holders. 
Within 60 days after each
[               ],
beginning with
[               ],
the Trustee will mail to each Holder, as provided in TIA Section 313(c), a
brief report dated as of such
[               ],
if required by TIA Section 313(a), and file such reports with each stock
exchange upon which the Notes are listed and with the Commission as required by
TIA Section 313(d).  The Trustee
shall also comply with Section 313(b) of the TIA.

 

Section 7.07.  Compensation
and Indemnity.  (a)  The Company will pay the Trustee
compensation as agreed upon in writing for its services.  The compensation of the Trustee is not
limited by any law on compensation of a Trustee of an express trust.  The Company will reimburse the Trustee upon
request for all reasonable out-of-pocket expenses, disbursements and advances
incurred or made by the Trustee, whether hereunder, under the Notes or under
the Collateral Documents, including:

 

(i)                                     the
reasonable compensation and expenses of the Trustee’s agents and counsel,
except for any such expense, disbursement or advances as may be attributable to
its negligence or bad faith;

 

(ii)                                  the
amount of any taxes that the Trustee or the Notes Collateral Agent may have
been required to pay by reason of the Liens granted pursuant to the Collateral
Documents or to free any Collateral from any Lien thereon; and

 

(iii)                               transfer
taxes and fees and expenses of counsel and other experts that the Trustee or
the Notes Collateral Agent may reasonably incur in connection with (x) the
administration or enforcement of the Collateral Documents, including such
expenses as are incurred to preserve the value of the Collateral or any
validity, perfection, rank or value of any Lien granted pursuant to the
Collateral Documents, (y) the collection, sale or

 

74

 

other disposition of any
Collateral or (z) the exercise by the Trustee or the Notes Collateral Agent of
any of its rights or powers under the Collateral Documents.

 

(b)                                 The
Company and the Guarantors, jointly and severally, will indemnify the Trustee
for, and hold it harmless against, any loss or liability or expense incurred by
it without negligence or bad faith on its part arising out of or in connection
with the acceptance or administration of this Indenture and the Collateral
Documents and its duties under this Indenture, the Notes and the Collateral
Documents, including the costs and expenses of defending itself against any claim
or liability and of complying with any process served upon it or any of its
officers in connection with the exercise or performance of any of its powers or
duties under this Indenture, the Notes and the Collateral Documents.

 

(c)                                  To
secure the Company’s 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, not in its individual capacity but solely as Trustee, except
money or property held in trust to pay principal of, and interest on particular
Notes.

 

Section 7.08.  Replacement
of Trustee.  (a) (1) The
Trustee may resign at any time by written notice to the Company.

 

(2)                                  The
Holders of a majority in principal amount of the outstanding Notes may remove
the Trustee by written notice to the Trustee and the Company.

 

(3)                                  If
the Trustee is no longer eligible under Section 7.10 or in the
circumstances described in TIA Section 310(b), any Holder that satisfies
the requirements of TIA Section 310(b) may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.

 

(4)                                  The
Company may remove the Trustee if: (i) the Trustee is no longer eligible under
Section 7.10; (ii) the Trustee is adjudged a bankrupt or an insolvent;
(iii) a receiver or other public officer takes charge of the Trustee or its
property; or (iv) the Trustee becomes incapable of acting.

 

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)                                 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.  If the successor Trustee does
not deliver its written acceptance within 30 days after the retiring Trustee
resigns or is removed, the retiring Trustee, the Company or the Holders of a
majority in principal amount of the outstanding Notes may petition at the
expense of the Company any court of competent jurisdiction for the appointment
of a successor Trustee.

 

(c)                                  Upon
delivery by the successor Trustee of a written acceptance of its appointment to
the retiring Trustee and to the Company, (i) the retiring Trustee will transfer
all property held by it as Trustee to the successor Trustee, subject to the
lien provided for in Section 7.07, (ii) the resignation or removal of the
retiring Trustee will become effective, and (iii) the successor

 

75

 

Trustee will have all the rights, powers and duties of
the Trustee under this Indenture.  Upon
request of any successor Trustee, the Company will execute any and all
instruments for fully and vesting in and confirming to the successor Trustee
all such rights, powers and trusts.  The
Company will give notice of any resignation and any removal of the Trustee and
each appointment of a successor Trustee to all Holders, and include in the
notice the name of the successor Trustee and the address of its Corporate Trust
Office.

 

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

 

(e)                                  The
Trustee agrees to give the notices provided for in, and otherwise comply with,
TIA Section 310(b).

 

Section 7.09.  Successor
Trustee by Merger.  If
the Trustee consolidates with, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation or
national banking association, the resulting, surviving or transferee
corporation or national banking association without any further act will be the
successor Trustee with the same effect as if the successor Trustee had been
named as the Trustee in this Indenture, provided, however, that in the case of
a corporation succeeding to all or substantially all the corporate trust
business of the Trustee, such successor corporation shall expressly assume all
of the Trustee’s liabilities hereunder. 
In case any Notes shall have been authenticated, but not delivered, by
the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such authentication and
deliver the Securities so authenticated with the same effect as if such
successor Trustee had itself authenticated such Notes.

 

Section 7.10.  Eligibility. 
This Indenture must always have a Trustee that satisfies the
requirements of TIA Section 310(a) and has a combined capital and surplus
of at least $100,000,000 as set forth in its most recent published annual
report of condition.

 

Section 7.11.  Money Held
in Trust.  The Trustee
will not be liable for interest on any money received by it except as it may
agree with the Company.  Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law and except for money held in trust under Article 8.

 

Section 7.12.  Appointment
of Co-Trustee.  (a)  Notwithstanding any other provisions of this
Indenture, at any time, for the purpose of meeting any legal requirement of any
jurisdiction in which any part of the Collateral may at the time be located,
the Trustee shall have the power and may execute and deliver all instruments
necessary to appoint one or more Persons to act as a co-trustee or co-trustees,
or separate trustee or separate trustees, of all or any part of the Collateral,
and to vest in such Person or Persons, in such capacity and for the benefit of
the Holders, such title to the Collateral, or any part hereof, and subject to
the other provisions of this Section, such powers, duties, obligations, rights
and trusts as the Trustee may consider necessary or desirable.  No co-trustee or separate trustee hereunder
shall be required to meet the terms of eligibility as a successor trustee under
Section 7.08 and no notice to Holders of the appointment of any co-trustee
or separate trustee shall be required under that section.

 

76

 

(b)                                 Every
separate trustee and co-trustee shall, to the extent permitted by law, be
appointed and act subject to the following provisions and conditions:

 

(1)                                  all
rights, powers, duties and obligations conferred or imposed upon the Trustee
shall be conferred or imposed upon and exercised or performed by the Trustee
and such separate trustee or co-trustee jointly (it being understood that such
separate trustee or co-trustee is not authorized to act separately without the
Trustee joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed the
Trustee shall be incompetent or unqualified to perform such act or acts, in
which event such rights, powers, duties and obligations (including the holding
of title to the Collateral or any portion thereof in any such jurisdiction)
shall be exercised and performed singly by such separate trustee or co-trustee,
but solely at the direction of the Trustee;

 

(2)                                  no
trustee hereunder shall be personally liable by reason of any act or omission
of any other trustee hereunder; and

 

(3)                                  the
Trustee may at any time accept the resignation of or remove any separate
trustee or co-trustee.

 

(c)                                  Any
notice, request or other writing given to the Trustee shall be deemed to have
been given to each of the then separate trustees and co-trustees, as
effectively as if given to each of them. 
Every instrument appointing any separate trustee or co-trustee shall
refer to this Indenture and the conditions of this Section 7.12.  Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the
provisions of this Indenture, specifically including every provision of this
Indenture relating to the conduct of, affecting the liability of, or affording
protection or rights (including the rights to compensation, reimbursement and
indemnification hereunder) to, the Trustee. 
Every such instrument shall be filed with the Trustee.

 

(d)                                 Any
separate trustee or co-trustee may at any time constitute the Trustee its agent
or attorney-in-fact with full power and authority, to the extent not prohibited
by law, to do any lawful act under or in respect of this Indenture on its
behalf and in its name.  If any separate
trustee or co-trustee shall die, become incapable of acting, resign or be
removed, all of its estates, properties, rights, remedies and trusts shall vest
in and be exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.

 

ARTICLE 8

DEFEASANCE AND DISCHARGE

 

Section 8.01.  Discharge of
Company’s Obligations. 
(a) Subject to Section 8.01(b), the Company’s obligations under the
Notes and this Indenture, and each Guarantor’s obligations under its Note
Guarantee, will terminate if:

 

(1)                                  all
Notes previously authenticated and delivered (other than (i) destroyed, lost or
stolen Notes that have been replaced or (ii) Notes that are paid pursuant to
Section 4.01 or (iii) Notes for whose payment money or U.S. Government
Obligations have been held in trust and

 

77

 

then repaid to the
Company pursuant to Section 8.05) have been delivered to the Trustee for
cancellation and the Company has paid all sums payable by it hereunder; or

 

(2)                                  (A)                              the
Notes mature within one year, or all of them are to be called for redemption
within one year under arrangements satisfactory to the Trustee for giving the
notice of redemption,

 

(B)                                the
Company irrevocably deposits in trust with the Trustee, as trust funds solely
for the benefit of the Holders, money or U.S. Government Obligations or a
combination thereof sufficient, in the opinion of a nationally recognized firm
of independent public accountants or a nationally recognized investment banking
or appraisal firm, expressed in a written certificate delivered to the Trustee,
without consideration of any reinvestment, to pay principal of, premium, if
any, and interest on the Notes to maturity or redemption, as the case may be,
and to pay all other sums payable by it hereunder,

 

(C)                                no
Default has occurred and is continuing on the date of the deposit pursuant to
(B) above,

 

(D)                               the
deposit will not result in a breach or violation of, or constitute a default
under, this Indenture or any other agreement or instrument to which the Company
is a party or by which it is bound, and

 

(E)                                 the
Company delivers to the Trustee an Officers’ Certificate and an Opinion of
Counsel, in each case stating that all conditions precedent provided for herein
relating to the satisfaction and discharge of this Indenture have been complied
with; provided that, such Opinion of Counsel may rely on an Officers’
Certificate or certificates of public officials with respect to matters of
fact.

 

(b)                                 After
satisfying the conditions in clause (a)(1), only the Company’s obligations
under Section 7.07 will survive. 
After satisfying the conditions in clause (a)(2), only the Company’s
obligations in Sections 2.02, 2.03, 2.04, 2.06, 2.08, 2.09, 2.10, 4.01, 4.02,
4.03, [5.01(c),] 7.07, 7.08, 8.05 and 8.06 will survive.  In either case, the Trustee upon request
will acknowledge in writing the discharge of the Company’s obligations under
the Notes and this Indenture other than the surviving obligations.

 

Section 8.02.  Legal Defeasance.  Following the deposit referred to in clause
(1) below, the Company will be deemed to have paid and will be discharged from
its obligations in respect of the Notes and this Indenture, other than its
obligations in Sections 2.02, 2.03, 2.04, 2.06, 2.08, 2.09, 2.10, 4.01, 4.02,
4.03, [5.01(c),] 7.07, 7.08, 8.05 and 8.06 and each Guarantor’s obligations
under its Note Guarantee will terminate, provided the following conditions have
been satisfied:

 

(1)                                  The
Company has irrevocably deposited in trust with the Trustee, as trust funds
solely for the benefit of the Holders, money or U.S. Government Obligations, or
a combination thereof, sufficient, in the opinion of a nationally recognized
firm of independent public accountants or a nationally recognized investment
banking or appraisal firm, expressed in a written certificate delivered to the
Trustee, without consideration of any reinvestment, to pay principal of,
premium, if any, and interest on

 

78

 

the Notes to maturity or
redemption, as the case may be, and to pay all other sums payable by it
hereunder, provided that any redemption before maturity has been irrevocably
provided for under arrangements satisfactory to the Trustee.

 

(2)                                  No
Default has occurred and is continuing on the date of the deposit.

 

(3)                                  The
deposit and such defeasance will not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or instrument
to which the Company is a party or by which it is bound.

 

(4)                                  The
Company has delivered to the Trustee

 

(A)                              either
(x) a ruling received from the Internal Revenue Service to the effect that the
Holders will not recognize income, gain or loss for U.S. federal income tax
purposes as a result of the defeasance and will be subject to U.S. federal
income tax on the same amount and in the same manner and at the same times as
would otherwise have been the case had such defeasance not occurred and/or (y)
an Opinion of Counsel, based on a change in law after the date of this
Indenture, to the same effect as the ruling described in clause (x), and

 

(B)                                an
Opinion of Counsel to the effect that (i) the creation of the defeasance trust
does not violate the Investment Company Act of 1940 and (ii) the Holders have a
valid first priority Note interest in the trust funds (subject to customary
exceptions).

 

(5)                                  The
Company has delivered to the Trustee an Officers’ Certificate and an Opinion of
Counsel, in each case stating that all conditions precedent provided for herein
relating to the defeasance have been complied with; provided that any such
Opinion of Counsel may rely on an Officers’ Certificate or certificates of
public officials with respect to matters of fact.

 

(6)                                  The
Company shall have delivered to the Trustee an Officers’ Certificate stating
that the deposit referred to in clause (1) was not made by the Company with the
intent of preferring the Holders over any other creditors of the Company or
with the intent of defeating, hindering, delaying or defrauding any other
creditors of the Company.

 

The Trustee upon request
will acknowledge in writing the discharge of the Company’s obligations under
the Notes and this Indenture except for the surviving obligations specified
above.

 

Section 8.03.  Covenant
Defeasance.  The
Company’s obligations set forth in Section 4.04 through 4.17, inclusive,
and Article 5 [, other than 5.01(c)], and each Guarantor’s obligations
under its Note Guarantee, will terminate, and clauses (3), (4), (5), (6), (9)
and (10) of Section 6.01 will no longer constitute Events of Default,
provided the following conditions have been satisfied:

 

(1)                                  The
Company has complied with clauses (1), (2), (3), 4(B), (5) and (6) of
Section 8.02; and

 

79

 

(2)                                  the
Company has delivered to the Trustee an Opinion of Counsel to the effect that
the Holders will not recognize income, gain or loss for U.S. federal income tax
purposes as a result of the defeasance and will be subject to U.S. federal
income tax on the same amount and in the same manner and at the same times as
would otherwise have been the case.

 

Except as specifically
stated above, none of the Company’s obligations under this Indenture will be
discharged.

 

Section 8.04.  Application of Trust Money.  Subject to Section 8.05, the Trustee will hold in trust the
money or U.S. Government Obligations deposited with it pursuant to Sections
8.01, 8.02 or 8.03, and apply the deposited money and the proceeds from
deposited U.S. Government Obligations to the payment (either directly or
through any Paying Agent, other than the Company or any Affiliate of the
Company) the Holders of such Notes of principal of premium, if any, all other
sums payable and interest on the Notes in accordance with the Notes and this
Indenture.  Such money and U.S.
Government Obligations need not be segregated from other funds except to the
extent required by law.

 

The Company shall pay and
indemnify the Trustee against any tax, fee or other charge imposed on or
assessed against the cash or non-callable U.S. Government Obligations deposited
pursuant to Sections 8.01, 8.02 or 8.03 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.

 

Section 8.05.  Repayment to Company. 
Subject to Sections 7.07, 8.01, 8.02 and 8.03, the Trustee will promptly
pay to the Company upon request any excess money held by the Trustee at any
time and thereupon be relieved from all liability with respect to such
money.  The Trustee will pay to the
Company upon request any money held for payment with respect to the Notes that
remains unclaimed for two years after it has become due and payable;  provided, however, that the Trustee, 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 shall not be less than 30 days from the date of
such notification or publication, any unclaimed balance of such money then
remaining shall be repaid to the Company. 
After payment to the Company, Holders entitled to such money must look
solely to the Company for payment, unless applicable law designates another
Person, and all liability of the Trustee with respect to such money will cease.

 

Section 8.06.  Reinstatement. 
If and for so long as the Trustee is unable to apply any money or U.S.
Government Obligations held in trust pursuant to Section 8.01, 8.02 or
8.03 by reason of any legal proceeding or by reason of any order or judgment of
any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, the Company’s obligations under this Indenture
and the Notes will be reinstated as though no such deposit in trust had been
made.  If the Company makes any payment
of principal of or interest on any Notes because of the reinstatement of its
obligations, it will be subrogated to the rights of the Holders of such Notes
to receive such payment from the money or U.S. Government Obligations held in
trust.

 

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ARTICLE 9

AMENDMENTS, SUPPLEMENTS AND WAIVERS

 

Section 9.01.  Amendments
Without Consent of Holders. 
The Company and the Trustee may amend or supplement this Indenture, the
Notes and the Collateral Documents, without notice to or the consent of any
Noteholder:

 

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

 

(2)                                  provide
for the assumption of the Company’s obligation in the case of a transaction
subject to the provisions of Section 5.01;

 

(3)                                  to
comply with any requirements for qualification of this Indenture under the TIA;

 

(4)                                  to
evidence and provide for the acceptance of an appointment by a successor
Trustee;

 

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

 

(6)                                  to
provide for any Guarantee of the Notes, to secure the Notes or to confirm and
evidence the release, termination or discharge of any Guarantee of or Lien
securing the Notes when such release, termination or discharge is permitted by
this Indenture;

 

(7)                                  to
add additional covenants of the Company or its Subsidiaries, to surrender
rights conferred upon the Company or its subsidiaries, or to confer additional
benefits upon the Holders;

 

(8)                                  to
make any other change that does not materially and adversely affect the rights
of any Holder; and

 

(9)                                  to
enter into additional or supplemental Collateral Documents.

 

Section 9.02.  Amendments With Consent of Holders.  (a) 
Except as otherwise provided in Sections 6.02, 6.04 and 6.07 or
paragraphs (b) or (c) below, the Company and the Trustee may amend or
supplement this Indenture, the Notes and the Collateral Documents, with the
written consent of the Holders of a majority in principal amount of the
outstanding Notes and the Holders of a majority in principal amount of the
outstanding Notes may waive future compliance by the Company and its Restricted
Subsidiaries with any provision of this Indenture or the Notes.

 

(b)                                 Notwithstanding
the provisions of Section 9.01(a), without the consent of each Holder
affected, an amendment or waiver may not:

 

81

 

(1)                                  reduce
the principal amount of or change the Stated Maturity of any installment of
principal of any Note,

 

(2)                                  reduce
the rate of or change the Stated Maturity of any interest payment on any Note,

 

(3)                                  reduce
the amount payable upon the redemption of any Note or change the time of any
mandatory redemption or, in respect of an optional redemption, the times at
which any Note may be redeemed or, once notice of redemption has been given,
the time at which it must thereupon be redeemed,

 

(4)                                  after
the time an Offer to Purchase is required to have been made, reduce the
purchase amount or purchase price, or extend the latest expiration date or
purchase date thereunder,

 

(5)                                  make
any Note payable in money other than that stated in the Note,

 

(6)                                  impair
the right of any Holder of Notes to receive any principal payment or interest
payment on such Holder’s Notes, on or after the Stated Maturity thereof, or to
institute suit for the enforcement of any such payment,

 

(7)                                  make
any change in the percentage of the principal amount of the Notes required for
amendments or waivers,

 

(8)                                  modify
or change any provision of this Indenture affecting the ranking of the Notes or
any Note Guarantee in a manner material and adverse to the Holders of the
Notes,

 

(9)                                  except
as otherwise provided in Section 9.02(c), make any change to provisions of
the Collateral Documents that would effect a release (other than releases
effected in accordance with the terms in effect on the Issue Date of this
Indenture and Collateral Documents) of all or any substantial part of the
Collateral or

 

(10)                            make
any change in any Note Guarantee that would materially and adversely affect the
Noteholders or effect a release of all or any substantial portion of the Note
Guarantees (in either case, other than releases effected in accordance with the
existing terms of this Indenture).

 

(c)                                  Notwithstanding
the provisions of Section 9.02(a), without the consent of the holders of
662/3% in principal amount of the
outstanding Notes, an amendment or waiver may not effect a release (other than
releases effected in accordance with the existing terms of this Indenture and
Collateral Documents) of any Collateral.

 

(d)                                 It
is not necessary for Holders to approve the particular form of any proposed
amendment, supplement or waiver, but is sufficient if their consent approves
the substance thereof.

 

82

 

(e)                                  An
amendment, supplement or waiver under this Section 9.02 will become
effective on receipt by the Trustee of written consents from the Holders of the
affected series of the requisite percentage in principal amount of the
outstanding Notes of that series.  After
an amendment, supplement or waiver under this Section 9.02 becomes
effective, the Company will send to the Holders affected thereby a written
notice briefly describing the amendment, supplement or waiver.  The Company will promptly send supplemental
indentures to affected Holders upon request. 
Any failure of the Company to send such notice, or any defect therein,
will not, however, in any way impair or affect the validity of any such
amendment, supplemental indenture or waiver.

 

Section 9.03.  Effect of Consent. 
(a)  After an amendment,
supplement or waiver becomes effective, it will bind every Holder unless it is
of the type requiring the consent of each Holder affected pursuant to the
provisions of this Indenture.  If the
amendment, supplement or waiver is of the type requiring the consent of each
Holder affected, the amendment, supplement or waiver will bind each Holder that
has consented to it and every subsequent Holder of a Note that evidences the
same debt as the Note of the consenting Holder.

 

(b)                                 If
an amendment, supplement or waiver changes the terms of a Note, the Trustee may
require the Holder to deliver it to the Trustee so that the Trustee may place
an appropriate notation of the changed terms on the Note and return it to the
Holder, or exchange it for a new Note that reflects the changed terms.  The Trustee may also place an appropriate
notation on any Note thereafter authenticated. 
However, the effectiveness of the amendment, supplement or waiver is not
affected by any failure to annotate or exchange Notes in this fashion.

 

Section 9.04.  Trustee’s Rights and Obligations.  The Trustee is entitled to receive (and
shall receive upon request), and will be fully protected in relying upon, an
Opinion of Counsel stating that the execution of any amendment, supplement or
waiver authorized pursuant to this Article 9 is authorized or permitted by
this Indenture.  If the Trustee has received
such an Opinion of Counsel, it shall sign the amendment, supplement or waiver
so long as the same does not adversely affect the rights of the Trustee.  The Trustee may, but is not obligated to,
execute any amendment, supplement or waiver that affects the Trustee’s own
rights, duties or immunities under this Indenture.

 

Section 9.05.  Conformity With Trust Indenture Act.  Every supplemental indenture executed
pursuant to this Article 9 shall conform to the applicable requirements of
the TIA.

 

ARTICLE 10

COLLATERAL ARRANGEMENTS

 

Section 10.01.  Collateral Documents. 
(a)  The due and punctual payment
of inter
alia the principal, interest and premium, if any, and any other
amounts due on the Notes when and as the same shall be due and payable, whether
on an Interest Payment Date, at maturity, by acceleration, repurchase,
redemption or otherwise, and interest on the overdue principal of and interest
on the Notes and performance of all other Secured Obligations of the Company
and the Guarantors to the Holders or the Trustee under this Indenture, the
Notes, the Note Guarantees and the Collateral Documents, according to the terms
hereunder or thereunder, are secured as provided in the Collateral
Documents.  The Trustee and the Company
hereby acknowledge and

 

83

 

agree that the Trustee or
the Notes Collateral Agent, as the case may be, holds the Collateral in trust
for the benefit of (i) the Trustee and the Holders, in each case pursuant to
the terms of the Collateral Documents, and (ii) if so required to give effect
to any provisions of the Intercreditor Agreement, the Collateral Agent under
the Credit Agreement and the other Lender Parties thereto. Each Holder, by
accepting a Note (or a beneficial interest therein), consents and agrees to the
terms of the Collateral Documents (including the provisions providing for
foreclosure and release of Collateral) as the same may be in effect or may be
amended from time to time in accordance with its terms and authorizes and
directs the Trustee and the Notes Collateral Agent to enter into the Collateral
Documents and to perform its obligations and exercise its rights thereunder in
accordance therewith. The Company shall deliver to the Trustee (if it is not
then the Notes Collateral Agent) copies of all documents delivered to the Notes
Collateral Agent pursuant to the Collateral Documents and will do or cause to
be done all such acts and things as may be required by the next sentence of
this Section 10.01, to assure and confirm to the Trustee and the Notes
Collateral Agent the security interest in the Collateral contemplated hereby
and by the Collateral Documents or any part thereof, as from time to time
constituted, so as to render the same available for the security and benefit of
this Indenture and of the Notes secured hereby, according to the intent and
purposes herein expressed. The Company shall take, and shall cause its
Subsidiaries to take, any and all actions reasonably required to cause the
Collateral Documents to create and maintain (to the extent contemplated
hereunder or thereunder), as security for the Secured Obligations of the
Company and the Guarantors, a valid and enforceable perfected Lien and security
interest (subject to Permitted Senior Liens) in and on all the Collateral, in
favor of the Trustee or the Notes Collateral Agent for the benefit of the
Holders; it being understood that the Trustee and Notes Collateral Agent shall
have no duty with respect to such actions.

 

(b)                                 The
Trustee hereby appoints the Notes Collateral Agent as its agent under the
Collateral Documents, and the Notes Collateral Agent is hereby authorized to
act on behalf of the Trustee, with full authority and powers of the Trustee
hereunder, solely with respect to its role as Notes Collateral Agent.

 

Section 10.02.  Recordings and Opinions.  (a)  Promptly following
the Issue Date, the Company shall furnish to the Trustee an Opinion of Counsel
to the effect that (i) in the opinion of such counsel, such action has been
taken with respect to the recording, registering and filing of or with respect
to this Indenture and the Collateral Documents and all other instruments of
further assurance as is necessary to make effective the Lien of the Collateral
Documents in the Collateral and referencing the details of such action; or (ii)
in the opinion of such counsel, no such action is necessary to make such Lien
effective provided that any such Opinion of Counsel may rely on an Officers’
Certificate or certificates of public officials with respect to matters of
fact.

 

(b)                                 The
Company shall furnish to the Trustee on or before
[                     ]
in each year beginning with [           ],
2005, an Opinion of Counsel dated as of such date, either:  (i) to the effect that, in the opinion of
such counsel, such action has been taken with respect to the recordings,
registerings, filings, re-recordings, re-registerings and re-filings of or with
respect to this Indenture and the Collateral Documents as is necessary to
maintain and perfect the Lien under this Indenture or any the Collateral
Documents in the Collateral and reciting the details of such action or
referencing to prior Opinions of Counsel in which such details are given; or
(ii) to 

 

84

 

the effect that, in the opinion of such counsel, no
such action is necessary to maintain and perfect such Lien under this Indenture
and the Collateral Documents.

 

(c)                                  All
Opinions of Counsel delivered pursuant to this Section 10.02 shall be in
form and substance satisfactory to the Trustee and may contain assumptions,
qualifications, exceptions and limitations as are appropriate and customary for
similar opinions relating to the nature of the Collateral.

 

(d)                                 The
Company shall otherwise comply with the provisions of TIA 314(b).

 

Section 10.03.  Release of Collateral. 
(a)  Subject to
subsection (b) of this Section 10.03, Collateral may be released from
the Lien created by this Indenture and the Collateral Documents at any time or
from time to time in accordance with the provisions of the Collateral Documents
and as provided by this Indenture.  Upon
the written request of the Company to the Trustee pursuant to an Officers’
Certificate certifying that all conditions precedent hereunder and under the
Collateral Documents have been met and that no Event of Default has occurred
and is continuing, the Company and the Guarantors will be entitled, without the
consent of the Holders, to the release of any Collateral from the Liens
securing the Notes and the Subsidiary Guarantees:

 

(1)                                  to
enable the Company or any Restricted Subsidiary to consummate any sale,
conveyance or other disposition of any assets in compliance with
Section 4.11 (or in a transaction not subject to Section 4.11) to any
Person other than the Company or a Restricted Subsidiary; provided, however,
that the Lien of this Indenture and the Collateral Documents will not be
released pursuant to this Section 10.03(a) if such sale, conveyance or
disposition is made as part of a transaction governed by Section 5.01;

 

(2)                                  pursuant
to an amendment, waiver or supplement effected in accordance with
Article 9.

 

(b)                                 Any
Officers’ Certificate requesting a release of Collateral under
Section 10.03(a) shall (i) describe with particularity the items of
property proposed to be covered by the release, (ii) state that such release is
in compliance with the terms of this Indenture and the Collateral Documents and
(iii) be accompanied by an Opinion of Counsel, which may be rendered by
internal counsel to the Company, to the effect that, in the opinion of such
counsel, the Company has complied with the requirements of TIA
Section 314(d); provided that any such Opinion of Counsel
may rely on an Officers’ Certificate or certificates of public officials with
respect to matters of fact. In the event of any release of any Collateral from
Liens securing the Notes pursuant to Section 10.03(a), promptly after the
receipt of such Officers’ Certificate and accompanying Opinion of Counsel, the
Trustee and the Notes Collateral Agent shall execute and deliver such documents
as the Company shall reasonably request to effectuate the release of such Liens
and to evidence such release.

 

(c)                                  Without
limiting the foregoing provisions of this Section 10.03, at any time when
a Default has occurred and is continuing and the maturity of Notes has been
accelerated (whether by declaration or otherwise) and the Trustee has delivered
a notice of acceleration to the Notes Collateral Agent, no release of
Collateral pursuant to the provisions of the Collateral Documents

 

85

 

will be effective as against the Holders, except to
the extent provided in the Intercreditor Agreement.

 

Section 10.04.  Permitted Releases Not To Impair Lien; Trust Indenture Act Requirements.  The release of any Collateral from the terms
hereof and of the Collateral Documents or the release of, in whole or in part,
the Liens created by the Collateral Documents, will not be deemed to impair the
Lien on the Collateral in contravention of the provisions hereof if and to the
extent the Collateral or Liens are released pursuant to the applicable
Collateral Documents and pursuant to the terms of this Article 10. The
Trustee and each of the Holders acknowledge that a release of Collateral or a
Lien strictly in accordance with the terms of the Collateral Documents and of
this Article 10 will not be deemed for any purpose to be an impairment of
the Lien on the Collateral in contravention of the terms of this Indenture. To
the extent applicable, the Company shall cause Section 314(d) of the TIA
(as modified by exemptive relief and no-action positions issued by the Staff of
the Commission from time to time, including, without limitation, the positions
set forth in Arch Wireless Holdings, Inc. dated May 24, 2002 and Algoma Steel
Inc. dated December 23, 2002) relating to the release of property or
securities from the Lien hereof and of the Collateral Documents to be complied
with. Any certificate or opinion required by Section 314(d) of the TIA may
be made by an officer of the Company, except in cases which Section 314(d)
of the TIA requires that such certificate or opinion be made by an independent
person.

 

Section 10.05.  Suits To Protect the Collateral.  Subject to the provisions of the Collateral
Documents, the Trustee shall have the power (but not the obligation) to
institute and to maintain such suits and proceedings as it may deem expedient
to prevent any impairment of the Collateral by any acts which may be unlawful
or in violation of any of the Collateral Documents or this Indenture, and such
suits and proceedings as the Trustee, in its sole discretion, may deem
expedient to preserve or protect its interests and the interests of the Holders
in the Collateral (including power to institute and maintain suits or proceedings
to restrain the enforcement of or compliance with any legislative or other
governmental enactment, rule or order that may be unconstitutional or otherwise
invalid if the enforcement of, or compliance with, such enactment, rule or
order would impair the Lien on the Collateral or be prejudicial to the
interests of the Holders or the Trustee).

 

Section 10.06.  Purchaser Protected. 
In no event shall any purchaser in good faith of any property purported
to be released hereunder be bound to ascertain the authority of the Trustee to
execute the release or to inquire as to the satisfaction of any conditions
required by the provisions hereof for the exercise of such authority or to see
to the application of any consideration given by such purchaser or other transferee;
nor shall any purchaser or other transferee of any property or rights permitted
by this Article 10 to be sold be under obligation to ascertain or inquire
into the authority of the Company or the applicable Guarantor to make any such
sale or other transfer.

 

Section 10.07.  Powers Exercisable by Receiver or Trustee.  In case the Collateral shall be in the
possession of a receiver or trustee, lawfully appointed, the powers conferred
in this Article 10 upon the Company or a Guarantor with respect to the
release, sale or other disposition of such property may be exercised by such
receiver or trustee, and an instrument signed by such receiver or trustee shall
be deemed the equivalent of any similar instrument of the Company or a

 

86

 

Guarantor or of any
officer or officers thereof required by the provisions of this Article 10,
and any such instrument need not state that no Event of Default has occurred
and is continuing; and if the Trustee shall be in the possession of the
Collateral under any provision of this Indenture, then such powers may be
exercised by the Trustee.

 

Section 10.08.  Disposition of Obligations Received.  All purchase money and other obligations
received by the Trustee or the Notes Collateral Agent under this
Article 10 shall be held by the Trustee or the Notes Collateral Agent, as
the case may be, and shall be added to the Collateral. Upon payment in cash or
Cash Equivalents by or on behalf of the Company to the Trustee or the Notes Collateral
Agent of an amount equal to the entire unpaid principal amount of any such
obligation, to the extent not constituting Net Cash Proceeds which may be
required, through the passage of time or otherwise, to be used to redeem or
repurchase or to make an Offer to Purchase Notes, the Trustee or the Notes
Collateral Agent, as appropriate, shall release and transfer such obligation
and any mortgage securing the same upon receipt of any documentation that the
Trustee or the Notes Collateral Agent, as appropriate, may reasonably require.
If the Notes have been accelerated pursuant to Section 6.02, any such
interest or other income not theretofore paid, when collected by the Trustee,
shall be applied by the Trustee in accordance with Section 6.10.

 

Section 10.09.  Determinations Relating to Collateral.  In the event (a) the Trustee shall receive
any written request from the Company, a Guarantor or the Notes Collateral Agent
under any Collateral Document for consent or approval with respect to any
matter or thing relating to any Collateral or the Company’s or a Guarantor’s
obligations with respect thereto or (b) there shall be due to or from the
Trustee or the Notes Collateral Agent under the provisions of any Collateral
Document any material performance or the delivery of any material instrument or
(c) the Trustee shall become aware of any material nonperformance by the
Company or a Guarantor of any covenant or any material breach of any
representation or warranty of the Company or a Guarantor set forth in any Collateral
Document, then, in each such event, the Trustee shall be entitled to hire, at
the sole reasonable cost and expense of the Company, experts, consultants,
agents and attorneys to advise the Trustee on the manner in which the Trustee
should respond, or direct the Notes Collateral Agent to respond, to such
request or render any requested performance or response to such nonperformance
or breach. The Trustee shall be fully protected in accordance with
Article 7 hereof in the taking of any action recommended or approved by
any such expert, consultant, agent or attorney and by indemnification provided
in accordance with Section 6.05 and other sections of this Indenture if
such action is agreed to by Holders of a majority in principal amount of the
Notes pursuant to Section 6.05 and, the Trustee may, in its sole
discretion, prior to taking such action if such action could subject it to
environmental liabilities or taxation, require (1) direction from the Holders
of a majority in principal amount of the Notes in accordance with
Section 6.05 hereof and (2) indemnification in accordance with
Section 6.05.

 

Section 10.10.  Release upon Termination of the Company’s Obligations.  In the event that the Company delivers to
the Trustee, in form and substance reasonably acceptable to it, an Officers’
Certificate certifying that either (1) all the obligations under this
Indenture, the Notes and the Collateral Documents have been satisfied and
discharged by complying with the provisions of Article 8 and
Section 7.07 (except for unmatured or unasserted indemnity claims pursuant
to Section 7.07) or by the payment in full of the Company’s obligations
under the

 

87

 

Notes, this Indenture and
the Collateral Documents, and all such obligations have been so satisfied, or
(2) the Notes have been defeased pursuant to Article 8, in either case the
Trustee shall deliver to the Company and the Notes Collateral Agent a notice
stating that the Trustee, on behalf of the Holders, disclaims and gives up any
and all rights it has in or to the Collateral (other than with respect to funds
held by the Trustee pursuant to Article 8), and any rights it has under
the Collateral Documents, and upon receipt by the Notes Collateral Agent of
such notice, the Notes Collateral Agent shall be deemed not to hold a Lien in
the Collateral on behalf of the Trustee and the Trustee and Notes Collateral
Agent shall release the Collateral (other than funds held by the Trustee
pursuant to Article 8) from such Liens at the Company’s sole cost and
expense and, upon written request by the Company, shall promptly execute and
deliver such documents as the Company shall reasonably request to effectuate
the release of such Liens.

 

Section 10.11.  Notes Collateral Agent’s Duties.  The Notes Collateral Agent, acting in its
capacity as such, shall have only such duties with respect to the Collateral as
are set forth herein and in the Collateral Documents.

 

Section 10.12.  Additional Secured Obligations.  If the Company at any time Incurs any
Indebtedness secured by a Lien on the Collateral, the Trustee and the Notes
Collateral Agent are empowered to enter into such security, collateral,
intercreditor and other similar agreements as are necessary to set forth the
relative rights and obligations of the Trustee and the Notes Collateral Agent,
on the one hand, and the agent or representative for the lenders of such
Indebtedness, on the other hand, in the Collateral.

 

Section 10.13.  Designation of New Indenture Documents.  The Company may, from time to time, by
delivering a written notice to the Trustee, designate one or more agreements,
instruments or other documents to be “New Indenture Documents”, which notice
shall attach an executed copy of the relevant agreement, instrument or document.

 

ARTICLE 11

GUARANTEES

 

Section 11.01.  The Guarantees. 
Subject to the provisions of this Article 11, each Guarantor hereby
irrevocably and unconditionally guarantees, jointly and severally, the full and
punctual payment (whether at Stated Maturity, upon redemption, purchase
pursuant to an Offer to Purchase or acceleration, or otherwise) of the
principal of, premium, if any, and interest (including Post Petition Interest)
on, and all other amounts payable under, each Note, and the full and punctual
payment of all other amounts payable by the Company under this Indenture.  Upon failure by the Company to pay
punctually any such amount, each Guarantor shall forthwith on demand pay the
amount not so paid at the place and in the manner specified in this Indenture.

 

Section 11.02.  Guarantee Unconditional.  Subject to the provisions of Section 11.09, the obligations
of each Guarantor hereunder are unconditional and absolute and, without
limiting the generality of the foregoing, will not be released, discharged or
otherwise affected by:

 

(1)                                  any
grants of time, extension, renewal, settlement, compromise, indulgence,
discharge, waiver or release in respect of any obligation of the Company under
this Indenture or any Note, by operation of law or otherwise;

 

88

 

(2)                                  any
modification or amendment of or supplement to this Indenture or any Note;

 

(3)                                  any
change in the corporate existence, structure or ownership of the Company, or
any insolvency, bankruptcy, reorganization or other similar proceeding
affecting the Company or its assets or any resulting release or discharge of
any obligation of the Company contained in this Indenture or any Note;

 

(4)                                  the
existence of any claim, set-off or other rights which any Guarantor may have at
any time against the Company, the Trustee or any other Person, whether in
connection with this Indenture or any unrelated transactions, provided that
nothing herein prevents the assertion of any such claim by separate suit or
compulsory counterclaim;

 

(5)                                  the
taking of Collateral from the Company, any Guarantor or any other Person, and
the release, discharge or alteration of, or other dealing with, such security;

 

(6)                                  the
abstention from taking Collateral from the Company, any Guarantor or any other
Person or from perfecting, continuing to keep perfected or taking advantage of
any security;

 

(7)                                  any
loss, diminution of value or lack of enforceability of any security received
from the Company, any Guarantor or any other Person, and including any other
guarantees received by the Trustee or the Notes Collateral Agent;

 

(8)                                  the
application by the Holders, the Trustee or the Notes Collateral Agent of all
monies at any time and from time to time received from the Company, any
Guarantor or any other Person on account of any indebtedness and liabilities
owing by the Company or any Guarantor to the Trustee, the Notes Collateral
Agent or the Holders, in such manner as the Trustee, the Notes Collateral Agent
or the Holders deems best and the changing of such application in whole or in
part and at any time or from time to time, or any manner of application of
collateral, or proceeds thereof, to all or any of the obligations under this
Indenture or any Note;

 

(9)                                  the
release or discharge of the Company or any Guarantor of the Notes or of any
Person liable directly as surety or otherwise by operation of law or otherwise
for the Securities, other than an express release in writing given by the
Trustee or the Notes Collateral Agent, on behalf of the Holders, of the liability
and obligations of any Guarantor hereunder;

 

(10)                            any
modification, compromise, settlement or release by the Trustee, or by operation
of law or otherwise, of the obligations under this Indenture or the liability
of the Company or any other obligor under the Notes, in whole or in part, and
any refusal of payment by the Trustee, in whole or in part, from any other
obligor or other guarantor in connection with any of the obligations under this
Indenture, whether or not with notice to, or further assent by, or any
reservation of rights against, each of the Guarantors;

 

(11)                            any
invalidity or unenforceability relating to or against the Company for any
reason of this Indenture or any Note, or any provision of applicable law or
regulation

 

89

 

purporting to prohibit
the payment by the Company of the principal of, premium, if any, or interest on
any Note or any other amount payable by the Company under this Indenture; or

 

(12)                            any
other act or omission to act or delay of any kind by the Company, the Trustee
or any other Person or any other circumstance whatsoever which might, but for
the provisions of this paragraph, constitute a legal or equitable discharge of
or defense to such Guarantor’s obligations hereunder.

 

Section 11.03.  Discharge; Reinstatement.  Subject to the provisions of Section 11.09, (i) each
Guarantor’s obligations hereunder will remain in full force and effect until
the principal of, premium, if any, and interest on the Notes and all other amounts
payable by the Company under this Indenture have been paid in full and (ii) if
at any time any payment of the principal of, premium, if any, or interest on
any Note or any other amount payable by the Company under this Indenture is
rescinded or must be otherwise restored or returned upon the insolvency,
bankruptcy or reorganization of the Company or otherwise, each Guarantor’s
obligations hereunder with respect to such payment will be reinstated as though
such payment had been due but not made at such time.

 

Section 11.04.  Waiver by the Guarantors.  Each Guarantor irrevocably waives acceptance hereof, presentment,
demand, protest and any notice not provided for herein, as well as any
requirement that at any time any action be taken by any Person against the
Company or any other Person.

 

Section 11.05.  Subrogation and Contribution.  Upon making any payment with respect to any obligation of the
Company under this Article 11, the Guarantor making such payment will be
subrogated to the rights of the payee against the Company with respect to such
obligation, provided that the Guarantor may not enforce either any right of
subrogation, or any right to receive payment in the nature of contribution, or
otherwise, from any other Guarantor, with respect to such payment so long as
any amount payable by the Company hereunder or under the Notes remains unpaid.

 

Section 11.06.  Stay of Acceleration. 
If acceleration of the time for payment of any amount payable by the
Company under this Indenture or the Notes is stayed upon the insolvency,
bankruptcy or reorganization of the Company, all such amounts otherwise subject
to acceleration under the terms of this Indenture are nonetheless payable by
the Guarantors hereunder forthwith on demand by the Trustee or the Holders.

 

Section 11.07.  Limitation on Amount of Guarantee.  Notwithstanding anything to the contrary in
this Article 11, 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 conveyance or
transfer under applicable fraudulent conveyance or transfer provisions of the
United States Bankruptcy Code or any comparable provision of foreign or state
law.  To effectuate that intention, the
Trustee, the Holders and the Guarantors hereby irrevocably agree that the
obligations of each Guarantor under its Note Guarantee are limited to the
maximum amount that would not render the Guarantor’s obligations subject to
avoidance under

 

90

 

applicable fraudulent
conveyance provisions of the United States Bankruptcy Code or any comparable
provision of applicable law.

 

Section 11.08.  Execution and Delivery of Guarantee.  The execution by each Guarantor of this
Indenture (or a supplemental indenture in the form of Exhibit C) evidences the
Note Guarantee of such Guarantor, whether or not the person signing as an
officer of the Guarantor still holds that office at the time of authentication
of any Note.  The delivery of any Note
by the Trustee after authentication constitutes due delivery of the Note
Guarantee set forth in this Indenture on behalf of each Guarantor.

 

Section 11.09.  Release of Guarantee. 
The Note Guarantee of a Guarantor will terminate upon:

 

(1)                                  a
sale or other disposition (including by way of consolidation, amalgamation or
merger) of the Guarantor or the sale or disposition of substantially all the
assets of the Guarantor otherwise permitted by this Indenture unless the
continuing or surviving entity in any such consolidation, amalgamation or
merger, or the entity that acquires such assets, is the Company or a Restricted
Subsidiary and the conditions set forth in Section 4.12 apply to such
continuing or surviving entity,

 

(2)                                  the
designation in accordance with this Indenture of the Guarantor as an
Unrestricted Subsidiary,

 

(3)                                  defeasance
or discharge of the Notes, as provided in Article 8, or

 

(4)                                  the
dissolution of the Guarantor.

 

Upon delivery by the
Company to the Trustee of an Officers’ Certificate and an Opinion of Counsel to
the foregoing effect, the Trustee will execute any documents reasonably
required in order to evidence the release of the Guarantor from its obligations
under its Note Guarantee.

 

Section 11.10.  No Suspension of Remedies.  Nothing contained in this Article shall limit the right of
the Trustee, the Notes Collateral Agent or the Holders of Notes to take any
action to accelerate the maturity of the Notes pursuant to the provisions
described under Article 6 and as otherwise set forth in this Indenture or
to pursue any rights or remedies hereunder or under applicable law.

 

ARTICLE 12

MISCELLANEOUS

 

Section 12.01.  Trust Indenture Act of 1939.  This Indenture shall incorporate and be governed by the
provisions of the TIA that are required to be part of and to govern indentures
qualified under the TIA.

 

Section 12.02.  Noteholder Communications; Noteholder Actions.  (a) 
The rights of Holders to communicate with other Holders with respect to
this Indenture or the Notes are as provided by the TIA, and the Company and the
Trustee shall comply with the requirements of TIA Sections 312(a) and
312(b).  Neither the Company nor the
Trustee will be held accountable

 

91

 

by reason of any disclosure
of information as to names and addresses of Holders made pursuant to the TIA.

 

(b)                                 (1)                                  Any
request, demand, authorization, direction, notice, consent to amendment,
supplement or waiver or other action provided by this Indenture to be given or
taken by a Holder (an “act”) may be evidenced by an instrument signed by the
Holder delivered to the Trustee.  The
fact and date of the execution of the instrument, or the authority of the
person executing it, may be proved in any manner that the Trustee deems
sufficient.

 

(2)                                  The
Trustee may make reasonable rules for action by or at a meeting of Holders,
which will be binding on all the Holders.

 

(c)                                  Any
act by the Holder of any Note binds that Holder and every subsequent Holder of
a Note that evidences the same debt as the Note of the acting Holder, even if
no notation thereof appears on the Note. 
Subject to paragraph (d), a Holder may revoke an act as to its Notes,
but only if the Trustee receives the notice of revocation before the date the
amendment or waiver or other consequence of the act becomes effective.

 

(d)                                 The
Company may, but is not obligated to, fix a record date (which need not be
within the time limits otherwise prescribed by TIA Section 316(c)) for the
purpose of determining the Holders entitled to act with respect to any
amendment or waiver or in any other regard, except that during the continuance
of an Event of Default, only the Trustee may set a record date as to notices of
default, any declaration or acceleration or any other remedies or other
consequences of the Event of Default. 
If a record date is fixed, those Persons that were Holders at such
record date and only those Persons will be entitled to act, or to revoke any
previous act, whether or not those Persons continue to be Holders after the
record date.  No act will be valid or
effective if such act is taken more than 90 days after the record date, if any,
set for that act pursuant to this Section 12.02(d).

 

Section 12.03.  Notices. 
(a)  Any notice or communication
to the Company will be deemed given if in writing (i) when delivered in person
or (ii) five days after mailing when mailed by first class mail, or (iii) when
sent by facsimile transmission, with transmission confirmed.  Notices or communications to a Guarantor
will be deemed given if given to the Company. 
Any notice to the Trustee will be effective only upon receipt.  In each case the notice or communication
should be addressed as follows:

 

if to the Company or the Guarantors:

 

Foster Wheeler LLC

c/o Foster Wheeler
Inc.

Perryville Corporate Park

Clinton, NJ  08809-4000

Telecopier No.: 908-730-5315
Attention: Steven I. Weinstein

 

92

 

if to the Trustee or the Notes Collateral Agent:

 

Wells Fargo Bank, National Association

Corporate Trust

Sixth and Marquette

MAC N9303-120

Minneapolis, MN  55479

Telecopier No.: 612-667-9825

Attention: Foster Wheeler Administrator

 

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

 

(b)                                 Except
as otherwise expressly provided with respect to published notices, any notice
or communication to a Holder will be deemed given when mailed to the Holder at
its address as it appears on the Register by first class mail or, as to any
Global Note registered in the name of DTC or its nominee, as agreed by the
Company, the Trustee and DTC.  Copies of
any notice or communication to a Holder, if given by the Company, will be
mailed to the Trustee at the same time. 
Defect in mailing a notice or communication to any particular Holder
will not affect its sufficiency with respect to other Holders.  If the Company mails a notice or
communication to Holders, it shall mail a copy to the Trustee at the same time.

 

(c)                                  Where
this Indenture provides for notice, the notice may be waived in writing by the
Person entitled to receive such notice, either before or after the event, and
the waiver will be the equivalent of the notice.  Waivers of notice by Holders must be filed with the Trustee, but
such filing is not a condition precedent to the validity of any action taken in
reliance upon such waivers.

 

Section 12.04.  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
will furnish to the Trustee such certificates and opinions as may be required
under the TIA.  Each such certificate or
opinion shall be given in the form of an Officers’ Certificate, if to be given
by an Officer of the Company, or an Opinion of Counsel, if to be given by
counsel, and shall comply with the requirements of the TIA and any applicable
requirements set forth in this Indenture.

 

Section 12.05.  Statements Required in Certificate or Opinion.  Each certificate or opinion with respect to
compliance by the Company with a condition or covenant provided for in this
Indenture must include:

 

(1)                                  a
statement that each Person signing the certificate or opinion has read the
covenant or condition and the related definitions;

 

(2)                                  a
brief statement as to the nature and scope of the examination or investigation
upon which the statement or opinion contained in the certificate or opinion is
based;

 

93

 

(3)                                  a
statement that, in the opinion of each such Person, that Person has made such
examination or investigation as is necessary to enable the Person to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and

 

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

 

Section 12.06.  Payment Date Other Than a Business Day.  If any payment with respect to a payment of
any principal of, premium, if any, or interest on any Note (including any
payment to be made on any date fixed for redemption or purchase of any Note) is
due on a day which is not a Business Day, then the payment need not be made on
such date, but may be made on the next Business Day with the same force and
effect as if made on such date, and no interest will accrue for the intervening
period.

 

Section 12.07.  Governing Law. 
This Indenture, including any Note Guarantees, and the Notes shall be
governed by, and construed in accordance with, the laws of the State of New
York.

 

Section 12.08.  No Adverse Interpretation of Other Agreements.  This Indenture may not be used to interpret
another indenture or loan or debt agreement of the Company or any Subsidiary of
the Company, and no such indenture or loan or debt agreement may be used to
interpret this Indenture.

 

Section 12.09.  Successors.  All
agreements of the Company or any Guarantor in this Indenture and the Notes will
bind its successors.  All agreements of
the Trustee in this Indenture will bind its successor.

 

Section 12.10.  Duplicate Originals. 
The parties may sign any number of copies of this Indenture.  Each signed copy shall be an original, but
all of them together represent the same agreement.

 

Section 12.11.  Separability.  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 12.12.  Table of Contents and Headings.  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 in no way modify or restrict any of the terms and provisions of
this Indenture.

 

Section 12.13.  No Liability of Directors, Officers, Employees, Incorporators, Members
and Stockholders.  No
director, officer, employee, incorporator, member or stockholder of the Company
or any Guarantor, as such, will have any liability for any obligations of the
Company or such Guarantor under the Notes, any Note Guarantee or this Indenture
or for any claim based on, in respect of, or by reason of, such
obligations.  Each Holder of Notes by
accepting a Note

 

94

 

 

waives and releases all
such liability. This waiver and release are part of the consideration for
issuance of the Notes.

 

Section 12.14.  Submission to Jurisdiction. 
To the fullest extent permitted by applicable law, each Obligor hereby
irrevocably and unconditionally submits to the jurisdiction of any New York
State or United States Federal court sitting in New York City over any suit,
action or proceeding arising out of or relating to this Indenture or any
Note.  Each Obligor irrevocably and
unconditionally waives, to the fullest extent permitted by applicable law, any
objection which it may now or hereafter have to the laying of the venue of any
such suit, action or proceeding brought in such a court and any claim that any
such suit, action or proceeding brought in such a court has been brought in an
inconvenient forum. To the extent that an Obligor has or hereafter may acquire
any immunity from jurisdiction of any court or from any legal process with
respect to itself or its property, such Obligor irrevocably waives, to the
fullest extent permitted by applicable law, such immunity in respect of its
obligations hereunder or under any Note. 
Each Obligor agrees that final judgment in any such suit, action or
proceeding brought in such a court shall be conclusive and binding upon such
Obligor and, to the extent permitted by applicable law, may be enforced in any
court to the jurisdiction of which such Obligor is subject by a suit upon such
judgment or in any manner provided by applicable law; provided that service of
process is effected upon such Obligor in the manner specified in the following
subsection or as otherwise permitted by applicable law.

 

Section 12.15.  Appointment of Agent.  As long as any of the Notes remain
outstanding, each Obligor will at all times have an authorized agent in the
State of New York, upon whom process may be served in any legal action or
proceeding arising out of or relating to this Indenture or any Note. Service of
process upon such agent and written notice of such service mailed or delivered
to such Obligor shall, to the fullest extent permitted by applicable law, be
deemed in every respect effective service of process upon such Obligor in any
such legal action or proceeding. Each Obligor hereby irrevocably appoints CT
Corporation System as its agent for such purpose, and covenants and agrees that
service of process in any suit, action or proceeding may be made upon it at the
office of such agent at 111 Eighth Avenue, 13th Floor, New York, New York
10011. Notwithstanding the foregoing, the Obligors may, with prior written
notice to the Trustee, terminate the appointment of CT Corporation System and
appoint another agent for the above purposes so that each Obligor shall at all
times have an agent for the above purposes in the State of New York.

 

95

 

SIGNATURES

 

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

 

	
   

  	
  FOSTER WHEELER
  LLC

  
	
   

  	
  as Issuer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

96

 

	
   

  	
  WELLS FARGO
  BANK, NATIONAL ASSOCIATION

  
	
   

  	
  not in its
  individual capacity but solely as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

97

 

	
   

  	
  FOSTER WHEELER
  LTD.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  CONTINENTAL
  FINANCE COMPANY LTD.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ENERGY HOLDINGS,
  INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EQUIPMENT
  CONSULTANTS, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FINANCIAL
  SERVICES, S.A.R.L.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  

 

98

 

	
   

  	
  FOSTER WHEELER
  HOLDINGS LTD.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  ASIA LIMITED

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  CAPITAL & FINANCE CORPORATION

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  CONSTRUCTORS, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  DEVELOPMENT CORPORATION

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

99

 

	
   

  	
  FW ENERGIE B.V.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  ENERGY CORPORATION

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  ENERGY MANUFACTURING, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  ENERGY SERVICES, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  EUROPE LIMITED

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

100

 

	
   

  	
  FOSTER WHEELER
  ENVIRESPONSE, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  ENVIRONMENTAL CORPORATION

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  FACILITIES MANAGEMENT, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  INTERCONTINENTAL CORPORATION

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

101

 

	
   

  	
  FOSTER WHEELER
  INTERNATIONAL CORPORATION

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  INTERNATIONAL HOLDINGS, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  NORTH AMERICA CORP. 

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  POWER SYSTEMS, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

102

 

	
   

  	
  FOSTER WHEELER
  PYROPOWER, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  REAL ESTATE DEVELOPMENT CORP.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  REALTY SERVICES, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  USA CORPORATION

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

103

 

	
   

  	
  FOSTER WHEELER
  VIRGIN ISLANDS, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  ZACK, INC. 

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FW HUNGARY
  LICENSING LIMITED LIABILITY COMPANY

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FW MORTSHAL,
  INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HFM
  INTERNATIONAL, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

104

 

	
   

  	
  PGI HOLDINGS,
  INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PROCESS
  CONSULTANTS, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PYROPOWER
  OPERATING SERVICES COMPANY, INC.

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  PERRYVILLE III
  TRUST

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  FOSTER WHEELER
  POWER CORPORATION

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

105

 

	
   

  	
  FOSTER WHEELER
  MIDDLE EAST CORPORATION

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

106

 

EXHIBIT A

 

[INSERT DTC LEGEND IF
REQUIRED]

 

[INSERT RESTRICTED LEGEND
IF REQUIRED]

 

[FACE OF NOTE]

 

FOSTER WHEELER LLC

 

[     ]%
Senior Secured Note Due 2011, Series A

 

	
   

  	
  [CUSIP] 
  [CINS] 

  	
   

  
	
   

  	
   

  
	
  No.

  	
  $

  	
   

  	
   

  
					

 

Foster Wheeler LLC, a
Delaware limited liability company (the “Company”, which term includes any
successor under the Indenture hereinafter referred to), for value received,
promises to pay to
                          ,
or its registered assigns, the principal sum of
                          
DOLLARS ($            )
on [    ], 2011.

 

Interest Rate:                         [     ]%
per annum.

 

Interest Payment
Dates:  [    ] and
[    ], commencing
[          ], 2004.

 

Regular Record
Dates:  [     ]
and [    ].

 

Reference is hereby made
to the further provisions of this Note set forth on the reverse hereof, which
will for all purposes have the same effect as if set forth at this place.

 

A-1

 

IN WITNESS WHEREOF, the
Company has caused this Note to be signed manually or by facsimile by its duly
authorized officers.

 

	
  Date:

  	
  FOSTER WHEELER
  LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

A-2

 

(Form of Trustee’s
Certificate of Authentication)

 

This is one of the
[     ]% Senior Secured Notes Due 2011, Series A, described
in the Indenture referred to in this Note.

 

	
   

  	
  WELLS FARGO
  BANK, NATIONAL

  ASSOCIATION, not in its individual capacity but

  solely as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized
  Signatory

  

 

A-3

 

[REVERSE SIDE OF NOTE]

 

FOSTER WHEELER LLC

 

[     ]%
Senior Secured Note Due 2011, Series A

 

1.                                       Principal
and Interest.

 

The Company promises to
pay the principal of this Note on
[             ],
2011.

 

The Company promises to
pay interest on the principal amount of this Note on each interest payment
date, as set forth on the face of this Note, at the rate of
[     ]% per annum (subject to adjustment as provided
below).

 

Interest will be payable
semiannually (to the holders of record of the Notes at the close of business on
the [     ] and [     ]
immediately preceding the interest payment date) on each interest payment date,
commencing
[              ],
2004.

 

Interest on this Note
will accrue from the most recent date to which interest has been paid on this
Note (or, if there is no existing default in the payment of interest and if
this Note is authenticated between a regular record date and the next interest
payment date, from such interest payment date) or, if no interest has been
paid, from the date of issuance. 
Interest will be computed in the basis of a 360-day year of twelve
30-day months.

 

The Company will pay,
from time to time on demand, interest on overdue principal, premium, if any,
and interest at a rate per annum that is 2% in excess of the rate of interest
that is applicable to the Notes. 
Interest not paid when due (including any thereof that becomes due on
demand) and any interest on principal, premium or interest not paid when due
(including any thereof that becomes due on demand) will be paid to the Persons that
are Holders on a special record date, which will be the 15th day preceding the
date fixed by the Trustee for the payment of such interest, whether or not such
day is a Business Day.  At least 15 days
before a special record date, the Company will send to each Holder and to the
Trustee a notice that sets forth the special record date, the payment date and
the amount of interest to be paid.

 

In the event that the
Excepted Non-Guarantor Subsidiaries do not execute all Note Guarantees and
pledge their assets in accordance with the Collateral Documents to secure their
Note Guarantees within 90 days of the Issue Date, the interest rate on the
Notes shall increase to [rate plus 1.0]% per annum, commencing on the 91st
day following the Issue Date through and until the date on which all such Note
Guarantees have been executed and pledges documented in accordance with the
Collateral Documents, after which the interest rate shall decrease to
[     ]% per annum.

 

2.                                       Indentures;
Note Guarantee.

 

This is one of the Notes
issued under an Indenture dated as of
[          ], 2004 (as
amended from time to time, the “Indenture”), among the Company, the Guarantors
party thereto and Wells Fargo Bank, National Association, not in its individual
capacity but solely as Trustee.

 

A-4

 

Capitalized terms
used herein are used as defined in the Indenture unless otherwise
indicated.  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 to the terms of the Intercreditor Agreement, and
Holders are referred to the Indenture, the TIA and the Intercreditor Agreement
for a statement of all such terms.  To
the extent permitted by applicable law, (i) in the event of any inconsistency
between the terms of this Note and the terms of the Indenture, the terms of the
Indenture will control, and (ii) in the event of any inconsistency between the
terms of this Note or the terms of the Indenture, on the one hand, and the
terms of the Intercreditor Agreement on the other hand, the terms of the
Intercreditor Agreement will control.

 

The Notes are general
unsecured obligations of the Company. 
The Indenture limits the original aggregate principal amount of the
Notes to $270,000,000.  This Note is
guaranteed, as set forth in the Indenture.

 

3.                                       Redemption
and Repurchase; Discharge Prior to Redemption or Maturity.

 

This Note is subject to
optional redemption, and may be the subject of an Offer to Purchase, as further
described in the Indenture.  There is no
sinking fund or mandatory redemption applicable to this Note.

 

If the Company deposits
with the Trustee money or U.S. Government Obligations sufficient to pay the
then outstanding principal of, premium, if any, and accrued interest on the
Notes to redemption or maturity, the Company may in certain circumstances be
discharged from the Indenture and the Notes or may be discharged from certain
of its obligations under certain provisions of the Indenture.

 

4.                                       Registered
Form; Denominations; Transfer; Exchange.

 

The Notes are in
registered form without coupons in denominations of $1.00 principal amount and
any multiple of $1.00 in excess thereof. 
A Holder may register the transfer or exchange of Notes in accordance
with the Indenture.  The Trustee may
require a Holder to furnish appropriate endorsements and transfer documents and
to pay any taxes and fees required by law or permitted by the Indenture.  Pursuant to the Indenture, there are certain
periods during which the Trustee will not be required to issue, register the
transfer of or exchange any Note or certain portions of a Note.

 

5.                                       Defaults and
Remedies.

 

If an Event of Default,
as defined in the Indenture, occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount of the Notes then
outstanding may declare all the Notes to be due and payable.  If a bankruptcy or insolvency default with
respect to the Company, Parent, any Significant Restricted Subsidiary or any
group of Restricted Subsidiaries that taken together would constitute a
Significant Restricted Subsidiary occurs and is continuing, the Notes
automatically become due and payable. 
Holders may not enforce the Indenture or the Notes except as provided in
the Indenture.  The Trustee may require
indemnity satisfactory to it before it enforces the Indenture or the
Notes.  Subject to certain limitations,
Holders of a majority in aggregate principal amount of the Notes then
outstanding may direct the Trustee in its exercise of remedies.

 

A-5

 

6.                                       Amendment
and Waiver.

 

Subject to certain
exceptions, the Indenture and the Notes may be amended, or default may be
waived, with the consent of the Holders of a majority in aggregate principal
amount of the Notes then outstanding. 
Without notice to or the consent of any Holder, the Company and the
Trustee may amend or supplement the Indenture or the Notes to, among other
things, cure any ambiguity, defect or inconsistency.

 

7.                                       Authentication.

 

This Note is not valid
until the Trustee (or Authenticating Agent) signs the certificate of
authentication on the other side of this Note.

 

8.                                       Governing
Law.

 

This Note shall be
governed by, and construed in accordance with, the laws of the State of New
York.

 

9.                                       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).

 

The Company will furnish
a copy of the Indenture to any Holder upon written request and without charge.

 

A-6

 

[FORM OF TRANSFER NOTICE]

 

FOR VALUE RECEIVED the
undersigned registered holder hereby sell(s), assign(s) and transfer(s) unto

 

	
  Insert Taxpayer
  Identification No.

  
	
   

  
	
   

  
	
   

  
	
  Please print or typewrite name and address including zip code of
  assignee

  
	
   

  
	
   

  
	
   

  
	
  The within Note and all rights thereunder, hereby irrevocably
  constituting and appointing

  
	
   

  
	
   

  
	
   

  

 

attorney to transfer said
Note on the books of the Company with full power of substitution in the
premises.

 

A-7

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you wish to have all
of this Note purchased by the Company pursuant to Section 4.10 or
Section 4.11 of the Indenture, check the box: o

 

If you wish to have a
portion of this Note purchased by the Company pursuant to Section 4.10 or
Section 4.11 of the Indenture, state the amount (in original principal
amount) below:

 

	
  $

  	
   

  	
  .

  
	
   

  
	
  Date:

  	
   

  	
   

  
	
   

  
	
  Your Signature:

  	
   

  	
   

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

  
	
   

  
	
  Signature
  Guarantee:(1)

  	
   

  	
   

  
	
   

  
									

 

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

 

A-8

 

SCHEDULE OF
EXCHANGES OF NOTES

 

The following exchanges
of a part of this Global Note for Physical Notes or a part of another Global
Note have been made:

 

	
  Date of Exchange

  	
   

  	
  Amount of
  decrease

  in principal amount

  of this Global Note

  	
   

  	
  Amount of
  increase

  in principal amount

  of this Global Note

  	
   

  	
  Principal
  Amount of

  this Global Note

  following such decrease

  (or increase)

  	
   

  	
  Signature
  of

  authorized officer of

  Trustee

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

A-9

 

EXHIBIT B

 

[INSERT DTC LEGEND IF
REQUIRED]

 

[INSERT RESTRICTED LEGEND
IF REQUIRED]

 

[FACE OF NOTE]

 

FOSTER WHEELER LLC

 

[    ]% Senior Secured Note Due 2011, Series B

 

	
   

  	
  [CUSIP] 
  [CINS] 

  	
   

  
	
   

  	
   

  
	
  No.

  	
  $

  	
   

  	
   

  
					

 

Foster Wheeler LLC, a
Delaware limited liability company (the “Company”, which term includes any successor
under the Indenture hereinafter referred to), for value received, promises to
pay to
                                   ,
or its registered assigns, the principal sum of
                    
DOLLARS ($          ) on
[                  ,]
2011.

 

Interest Rate:                         [      ]%
per annum.

 

Interest Payment
Dates: 
           and
               ,
commencing           , 2004.

 

Regular Record
Dates: 
            
and
                       .

 

Reference is hereby made
to the further provisions of this Note set forth on the reverse hereof, which
will for all purposes have the same effect as if set forth at this place.

 

B-1

 

IN WITNESS WHEREOF, the
Company has caused this Note to be signed manually or by facsimile by its duly
authorized officers.

 

	
  Date:

  	
  FOSTER WHEELER
  LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  

 

B-2

 

(Form of Trustee’s
Certificate of Authentication)

 

This is one of the [    ]% Senior Secured Notes Due 2011, Series B
described in the Indenture referred to in this Note.

 

 

	
   

  	
  WELLS FARGO
  BANK, NATIONAL

  ASSOCIATION, not in its individual capacity but

  solely as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized
  Signatory

  

 

B-3

 

[REVERSE SIDE OF NOTE]

 

FOSTER WHEELER LLC

 

[      ]%
Senior Secured Note Due 2011, Series B

 

1.                                       Principal
and Interest.

 

The Company promises to
pay the principal of this Note on
[                      ],
2011.

 

The Company promises to
pay interest on the principal amount of this Note on each interest payment
date, as set forth on the face of this Note, at the rate of [    ]% per annum (subject to adjustment as
provided below).

 

Interest will be payable
semiannually (to the holders of record of the Notes at the close of business on
the            or
                           
immediately preceding the interest payment date) on each interest payment date,
commencing
                ,
2004.

 

The Holder of this Note
is entitled to the benefits of the Registration Rights Agreement, dated
                   ,
2004, between the Company and the Purchasers named therein (the “Registration
Rights Agreement”).  The interest rate
on this Note will increase by a rate of 0.5% per annum in the event that (i)
the Exchange Offer Registration Statement (as defined in the Registration
Rights Agreement) is not filed by 30th day following the Issue Date, until it
is filed (ii) the Exchange Offer Registration Statement is not declared
effective by the Commission by the 90th day following Issue Date, until the
Exchange Offer Registration Statement is declared effective and (iii) the
Exchange Offer (as defined in the Registration Rights Agreement) is not
consummated pursuant to the Exchange Offer Registration Statement by the 120th
day following the Issue Date, until it is consummated.  After 120 days following an increase in the
interest rate as described in the preceding sentence, the interest rate on this
Note shall increase by a further 0.25% per annum, and shall increase by 0.25%
per annum for each 120-day period thereafter to a maximum increase in interest
of 1.00% per annum.  If the Exchange
Offer does not allow this Note to be exchanged for freely tradable senior
secured notes, the Company will file a shelf registration statement (the “Shelf
Registration Statement”) covering the resale of this Note by the holder and use
its commercially reasonable best efforts to have the Shelf Registration
Statement declared effective as soon as practicable.  Upon the effectiveness of the Shelf Registration Statement, any
such increased interest shall cease to accrue.

 

Interest on this Note
will accrue from the most recent date to which interest has been paid on this
Note (or, if there is no existing default in the payment of interest and if this
Note is authenticated between a regular record date and the next interest
payment date, from such interest payment date) or, if no interest has been
paid, from the date of issuance. 
Interest will be computed in the basis of a 360-day year of twelve 30-day
months.

 

The Company will pay,
from time to time on demand, interest on overdue principal, premium, if any,
and interest at a rate per annum that is 2% in excess of the rate of interest
that is applicable to the Notes.  Interest
not paid when due (including any thereof that becomes due on

 

B-4

 

demand) and any
interest on principal, premium or interest not paid when due (including any
thereof that becomes due on demand) will be paid to the Persons that are
Holders on a special record date, which will be the 15th day preceding the date
fixed by the Trustee for the payment of such interest, whether or not such day
is a Business Day.  At least 15 days
before a special record date, the Company will send to each Holder and to the
Trustee a notice that sets forth the special record date, the payment date and
the amount of interest to be paid.

 

In the event that the
Excepted Non-Guarantor Subsidiaries do not execute all Note Guarantees and
pledge their assets in accordance with the Collateral Documents to secure their
Note Guarantees within 90 days of the Issue Date, the interest rate on the
Notes shall increase to [rate plus 1.0]% per annum, commencing on the 91st
day following the Issue Date through and until the date on which all such Note
Guarantees have been executed and pledges documented in accordance with the
Collateral Documents, after which the interest rate shall decrease to [    ]% per annum.

 

2.                                       Indentures;
Note Guarantee.

 

This is one of the Notes
issued under an Indenture dated as of
                   ,
2004 (as amended from time to time, the “Indenture”), among the Company, the
Guarantors party thereto and Wells Fargo Bank, National Association, not in its
individual capacity but solely as Trustee.  Capitalized terms used herein are used as defined in the Indenture
unless otherwise indicated.  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 to the terms of the Intercreditor
Agreement, and Holders are referred to the Indenture, the TIA and the
Intercreditor Agreement for a statement of all such terms.  To the extent permitted by applicable law,
(i) in the event of any inconsistency between the terms of this Note and the
terms of the Indenture, the terms of the Indenture will control, and (ii) in
the event of any inconsistency between the terms of this Note or the terms of
the Indenture, on the one hand, and the terms of the Intercreditor Agreement on
the other hand, the terms of the Intercreditor Agreement will control.

 

The Notes are general
unsecured obligations of the Company. 
The Indenture limits the original aggregate principal amount of the
Notes to $120,000,000.  This Note is guaranteed,
as set forth in the Indenture.

 

3.                                       Redemption
and Repurchase; Discharge Prior to Redemption or Maturity.

 

This Note is subject to
optional redemption, and may be the subject of an Offer to Purchase, as further
described in the Indenture.  There is no
sinking fund or mandatory redemption applicable to this Note.

 

If the Company deposits
with the Trustee money or U.S. Government Obligations sufficient to pay the
then outstanding principal of, premium, if any, and accrued interest on the
Notes to redemption or maturity, the Company may in certain circumstances be
discharged from the Indenture and the Notes or may be discharged from certain
of its obligations under certain provisions of the Indenture.

 

B-5

 

4.                                       Registered
Form; Denominations; Transfer; Exchange.

 

The Notes are in
registered form without coupons in denominations of $1.00 principal amount and
any multiple of $1.00 in excess thereof. 
A Holder may register the transfer or exchange of Notes in accordance
with the Indenture.  The Trustee may
require a Holder to furnish appropriate endorsements and transfer documents and
to pay any taxes and fees required by law or permitted by the Indenture.  Pursuant to the Indenture, there are certain
periods during which the Trustee will not be required to issue, register the
transfer of or exchange any Note or certain portions of a Note.

 

5.                                       Defaults and
Remedies.

 

If an Event of Default,
as defined in the Indenture, occurs and is continuing, the Trustee or the
Holders of at least 25% in aggregate principal amount of the Notes then
outstanding may declare all the Notes to be due and payable.  If a bankruptcy or insolvency default with
respect to the Company, Parent, any Significant Restricted Subsidiary or any
group of Restricted Subsidiaries that taken together would constitute a
Significant Restricted Subsidiary occurs and is continuing, the Notes
automatically become due and payable. 
Holders may not enforce the Indenture or the Notes except as provided in
the Indenture.  The Trustee may require
indemnity satisfactory to it before it enforces the Indenture or the
Notes.  Subject to certain limitations,
Holders of a majority in aggregate principal amount of the Notes then
outstanding may direct the Trustee in its exercise of remedies.

 

6.                                       Amendment
and Waiver.

 

Subject to certain
exceptions, the Indenture and the Notes may be amended, or default may be
waived, with the consent of the Holders of a majority in aggregate principal
amount of the Notes then outstanding. 
Without notice to or the consent of any Holder, the Company and the
Trustee may amend or supplement the Indenture or the Notes to, among other
things, cure any ambiguity, defect or inconsistency.

 

7.                                       Authentication.

 

This Note is not valid
until the Trustee (or Authenticating Agent) signs the certificate of
authentication on the other side of this Note.

 

8.                                       Governing
Law.

 

This Note shall be
governed by, and construed in accordance with, the laws of the State of New
York.

 

9.                                       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).

 

The Company will furnish
a copy of the Indenture to any Holder upon written request and without charge.

 

B-6

 

[FORM OF TRANSFER NOTICE]

 

FOR VALUE RECEIVED the
undersigned registered holder hereby sell(s), assign(s) and transfer(s) unto

 

	
  Insert Taxpayer
  Identification No.

  
	
   

  
	
   

  
	
   

  
	
  Please print or typewrite name and address including zip code of
  assignee

  
	
   

  
	
   

  
	
   

  
	
  The within Note and all rights thereunder, hereby irrevocably constituting
  and appointing

  
	
   

  
	
   

  

 

attorney to transfer said
Note on the books of the Company with full power of substitution in the
premises.

 

B-7

 

[THE FOLLOWING PROVISION
TO BE INCLUDED ON ALL CERTIFICATES BEARING A RESTRICTED LEGEND]

 

In connection with any
transfer of this Note occurring prior to
                                    ,
the undersigned confirms that such transfer is made without utilizing any
general solicitation or general advertising and further as follows:

 

Check One

 

o                                    (1)                                  This Note is being
transferred to a “qualified institutional buyer” in compliance with Rule 144A
under the Securities Act of 1933, as amended and certification in the form of
Exhibit G to the Indenture is being furnished herewith.

 

o                                    (2)                                  This Note is being
transferred to a Non-U.S. Person in compliance with the exemption from
registration under the Securities Act of 1933, as amended, provided by
Regulation S thereunder, and certification in the form of Exhibit F to the Indenture
is being furnished herewith.

 

or

 

o                                    (3)                                  This Note is being
transferred other than in accordance with (1) or (2) above and documents are
being furnished which comply with the conditions of transfer set forth in this
Note and the Indenture.

 

If none of the foregoing
boxes is checked, the Trustee is not obligated to register this Note in the
name of any Person other than the Holder hereof unless and until the conditions
to any such transfer of registration set forth herein and in the Indenture have
been satisfied.

 

	
  Date:

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Seller

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NOTICE:  The signature to this assignment must
  correspond with the name as written upon the face of the within mentioned
  instrument in every particular, without alteration or any change whatsoever.

  
							

 

B-8

 

	
  Signature
  Guarantee:(2)

  	
   

  
	
   

  	
   

  
	
   

  	
  By

  	
   

  	
   

  
	
   

  	
  To be executed
  by an executive officer

  

 

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

 

B-9

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you wish to have all
of this Note purchased by the Company pursuant to Section 4.10 or
Section 4.11 of the Indenture, check the box: o

 

If you wish to have a
portion of this Note purchased by the Company pursuant to Section 4.10 or
Section 4.11 of the Indenture, state the amount (in original principal
amount) below:

 

	
  $

  	
   

  	
  .

  
	
   

  
	
  Date:

  	
   

  	
   

  
	
   

  
	
  Your Signature:

  	
   

  	
   

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

  
	
   

  
	
  Signature Guarantee:(3)

  	
   

  	
   

  
									

 

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

 

B-10

 

SCHEDULE OF EXCHANGES OF NOTES

 

The following exchanges
of a part of this Global Note for Physical Notes or a part of another Global
Note have been made:

 

	
  Date of Exchange

  	
   

  	
  Amount of
  decrease

  in principal amount

  of this Global Note

  	
   

  	
  Amount of
  increase

  in principal amount

  of this Global Note

  	
   

  	
  Principal
  Amount of

  this Global Note

  following such decrease

  (or increase)

  	
   

  	
  Signature
  of

  authorized officer of

  Trustee

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  

 

B-11

 

 

EXHIBIT C

 

SUPPLEMENTAL INDENTURE

 

dated as of
                         ,
          

 

among

 

FOSTER WHEELER LLC

 

The Guarantor(s) Party
Hereto

 

and

 

WELLS FARGO BANK,
NATIONAL ASSOCIATION

not in its individual capacity but solely as Trustee

 

[    ]%

Senior Secured Notes due

2011, Series A

 

[    ]%

Senior Secured Notes due

2011, Series B

 

C-1

 

THIS SUPPLEMENTAL
INDENTURE (this “Supplemental Indenture”), entered into as of
                     ,
         , among Foster Wheeler
LLC, a Delaware limited liability company (the “Company”), [insert each
Guarantor executing this Supplemental Indenture and its jurisdiction of
incorporation] (each an “Undersigned”) and Wells Fargo Bank,
National Association, not in its individual capacity but solely as trustee (the
“Trustee”).

 

RECITALS

 

WHEREAS, the Company, the
Guarantors party thereto and the Trustee entered into the Indenture, dated as of
                      ,
2004 (the “Indenture”), relating to the Company’s
[     ]% Senior Secured Notes Due 2011, Series A and
the Company’s [      ]% Senior Secured Notes Due
2011, Series B (the “Notes”);

 

WHEREAS, as a condition
to the Trustee entering into the Indenture and the purchase of the Notes by the
Holders, the Company agreed, under certain circumstances described in the
Indenture, to cause certain newly acquired or created Restricted Subsidiaries
to provide Note Guarantees.

 

AGREEMENT

 

NOW, THEREFORE, in
consideration of the premises and mutual covenants herein contained and
intending to be legally bound, the parties to this Supplemental Indenture
hereby agree as follows:

 

Section 1.  Capitalized terms used herein and not
otherwise defined herein are used as defined in the Indenture.

 

Section 2.  Each Undersigned, by its execution of this
Supplemental Indenture, agrees to be a Guarantor under the Indenture and to be
bound by the terms of the Indenture applicable to Guarantors, including, but not
limited to, Article 11 thereof.

 

Section 3.  This Supplemental Indenture shall be
governed by and construed in accordance with the laws of the State of New York.

 

Section 4.  This Supplemental Indenture may be signed in
various counterparts which together will constitute one and the same
instrument.

 

Section 5.  This Supplemental Indenture is an amendment
supplemental to the Indenture and the Indenture and this Supplemental Indenture
will henceforth be read together.

 

C-2

 

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

 

	
   

  	
  FOSTER WHEELER
  LLC as Issuer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  [GUARANTOR]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WELLS FARGO
  BANK, NATIONAL

  ASSOCIATION, not in its individual capacity but

  solely as Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

C-3

 

EXHIBIT D

 

RESTRICTED LEGEND

 

THIS NOTE HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN
ACCORDANCE WITH THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A
BENEFICIAL INTEREST HEREIN, THE ACQUIRER (1) REPRESENTS THAT (A) IT AND ANY
ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL BUYER” (WITHIN THE
MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT EXERCISES SOLE
INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT, (B) IT IS AN
INSTITUTIONAL “ACCREDITED INVESTOR” (WITHIN THE MEANING OF RULE 501(A)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT) (AN “INSTITUTIONAL ACCREDITED INVESTOR”)
OR (C) IT IS NOT A U.S. PERSON (WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES
ACT) AND (2) AGREES FOR THE BENEFIT OF FOSTER WHEELER LLC THAT IT WILL NOT
OFFER, SELL PLEDGE OR OTHERWISE TRANSFER THIS NOTE OR ANY BENEFICIAL INTEREST
HEREIN, EXCEPT IN ACCORDANCE WITH THE SECURITIES ACT AND ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES AND ONLY (A) TO FOSTER
WHEELER LLC, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME
EFFECTIVE UNDER THE SECURITIES ACT, (C) TO A QUALIFIED INSTITUTIONAL BUYER IN
COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (D) IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE SECURITIES
ACT, (E) TO AN INSTITUTIONAL ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER,
DELIVERS TO THE TRUSTEE A DULY COMPLETED AND SIGNED CERTIFICATE (THE FORM OF
WHICH MAY BE OBTAINED FROM THE TRUSTEE) RELATING TO THE RESTRICTIONS ON
TRANSFER OF THIS NOTE, OR (F) PURSUANT TO AN EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT OR ANY OTHER AVAILABLE EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

 

PRIOR TO THE REGISTRATION
OF ANY TRANSFER IN ACCORDANCE WITH (2)(C) ABOVE OR (2)(D) ABOVE, A DULY
COMPLETED AND SIGNED CERTIFICATE (THE FORM OF WHICH MAY BE OBTAINED FROM THE
TRUSTEE) MUST BE DELIVERED TO THE TRUSTEE. PRIOR TO THE REGISTRATION OF ANY
TRANSFER IN ACCORDANCE WITH (2)(E) OR (F) ABOVE, THE COMPANY RESERVES THE RIGHT
TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS, CERTIFICATIONS OR OTHER
EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO DETERMINE THAT THE PROPOSED
TRANSFER IS BEING MADE IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE
STATE SECURITIES LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY
RULE 144 

 

D-1

 

EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

 

D-2

 

EXHIBIT E

 

DTC LEGEND

 

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

 

[TRANSFERS OF THIS GLOBAL
NOTE ARE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE
& CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS
OF PORTIONS OF THIS GLOBAL NOTE ARE LIMITED TO TRANSFERS MADE IN ACCORDANCE
WITH THE TRANSFER PROVISIONS OF THE INDENTURE.]

 

E-1

 

EXHIBIT F

 

Regulation S Certificate

 

 

	
   

  	
   

  	
   

  	
   

  	
  ,

  

 

Wells Fargo Bank,
National Association

 

Attention: Corporate
Trust Administration

 

Re:                               Foster
Wheeler LLC

[     ]% Senior Secured

Notes due 2011, Series B (the “Notes”)

Issued under the Indenture (the “Indenture”) dated as

as of
               ,
2004 relating to the Notes

 

Ladies and Gentlemen:

 

Terms are used in this
Certificate as used in Regulation S (“Regulation S”) under the Securities Act
of 1933, as amended (the “Securities Act”), except as otherwise stated herein.

 

[CHECK A OR B AS APPLICABLE.]

 

o                                    A.                                   This Certificate
relates to our proposed transfer of $       
principal amount of Notes issued under the Indenture.  We hereby certify as follows:

 

1.                                       The
offer and sale of the Notes was not and will not be made to a person in the
United States (unless such person is excluded from the definition of “U.S.
person” pursuant to Rule 902(k)(2)(vi) or the account held by it for which it
is acting is excluded from the definition of “U.S. person” pursuant to Rule
902(k)(2)(i) under the circumstances described in Rule 902(h)(3)) and such
offer and sale was not and will not be specifically targeted at an identifiable
group of U.S. citizens abroad.

 

2.                                       Unless
the circumstances described in the parenthetical in paragraph 1 above are
applicable, either (a) at the time the buy order was originated, the buyer was
outside the United States or we and any person acting on our behalf reasonably
believed that the buyer was outside the United States or (b) the transaction
was executed in, on or through the facilities of a designated offshore
securities market, and neither we nor any person acting on our behalf knows
that the transaction was pre-arranged with a buyer in the United States.

 

3.                                       Neither
we, any of our affiliates, nor any person acting on our or their behalf has
made any directed selling efforts in the United States with respect to the
Notes.

 

F-1

 

4.                                       The
proposed transfer of Notes is not part of a plan or scheme to evade the
registration requirements of the Securities Act.

 

5.                                       If
we are a dealer or a person receiving a selling concession, fee or other
remuneration in respect of the Notes, and the proposed transfer takes place
during the Restricted Period (as defined in the Indenture), or we are an
officer or director of the Company or an Purchaser (as defined in the
Indenture), we certify that the proposed transfer is being made in accordance
with the provisions of Rule 904(b) of Regulation S.

 

o                                    B.                                     This Certificate
relates to our proposed exchange of
$         principal amount of Notes
issued under the Indenture for an equal principal amount of Notes to be held by
us.  We hereby certify as follows:

 

1.                                       At
the time the offer and sale of the Notes was made to us, either (i) we were not
in the United States or (ii) we were excluded from the definition of “U.S.
person” pursuant to Rule 902(k)(2)(vi) or the account held by us for which we were
acting was excluded from the definition of “U.S. person” pursuant to Rule
902(k)(2)(i) under the circumstances described in Rule 902(h)(3); and we were
not a member of an identifiable group of U.S. citizens abroad.

 

2.                                       Unless
the circumstances described in paragraph 1(ii) above are applicable, either (a)
at the time our buy order was originated, we were outside the United States or
(b) the transaction was executed in, on or through the facilities of a
designated offshore securities market and we did not pre-arrange the
transaction in the United States.

 

3.                                       The
proposed exchange of Notes is not part of a plan or scheme to evade the
registration requirements of the Securities Act.

 

You and the Company are
entitled to rely upon this Certificate and are irrevocably authorized to
produce this Certificate or a copy hereof to any interested party in any
administrative or legal proceeding or official inquiry with respect to the
matters covered hereby.

 

	
   

  	
  Very truly
  yours,

  
	
   

  	
   

  
	
   

  	
  [NAME OF SELLER
  (FOR TRANSFERS) OR

  OWNER (FOR EXCHANGES)]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  
						

 

F-2

 

EXHIBIT G

 

Rule 144A Certificate

 

                  ,
        

 

Wells Fargo Bank, National Association

                                              

                                              

Attention: Corporate Trust Administration

 

Re:                               Foster
Wheeler LLC

[    ]% Senior Secured

Notes due 2011, Series B (the “Notes”)

Issued under the Indenture (the “Indenture”) dated as

as of
                    ,
2004 relating to the Notes

 

Ladies and Gentlemen:

 

TO BE COMPLETED BY PURCHASER IF (1) ABOVE IS CHECKED.

 

This Certificate relates to:

 

[CHECK
A OR B AS APPLICABLE.]

 

o                                    A.                                   Our proposed
purchase of $         principal amount
of Notes issued under the Indenture.

 

o                                    B.                                     Our proposed
exchange of $         principal amount
of Notes issued under the Indenture for an equal principal amount of Notes to
be held by us.

 

We and, if applicable, each account for which we are
acting in the aggregate owned and invested more than $100,000,000 in securities
of issuers that are not affiliated with us (or such accounts, if applicable),
as of
                  ,
200  , which is a date on or since close of our most recent fiscal
year.  We and, if applicable, each
account for which we are acting, are a qualified institutional buyer within the
meaning of Rule 144A (“Rule 144A”) under the Securities Act of 1933, as amended
(the “Securities Act”).  If we are acting
on behalf of an account, we exercise sole investment discretion with respect to
such account. We are aware that the transfer of Notes to us, or such exchange,
as applicable, is being made in reliance upon the exemption from the provisions
of Section 5 of the Securities Act provided by Rule 144A.  Prior to the date of this Certificate we
have received such information regarding the Company as we have requested
pursuant to Rule 144A(d)(4) or have determined not to request such information.

 

G-1

 

You and the Company are entitled to rely upon this
Certificate and are irrevocably authorized to produce this Certificate or a
copy hereof to any interested party in any administrative or legal proceeding
or official inquiry with respect to the matters covered hereby.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  [NAME OF PURCHASER (FOR
  TRANSFERS)

  OR OWNER (FOR EXCHANGES)]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
  Address:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  	
   

  
					

 

G-2

 

EXHIBIT H

 

Institutional Accredited Investor Certificate

 

Wells Fargo Bank, National Association

                                              

                                              

Attention: Corporate Trust Administration

 

Re:                               Foster
Wheeler LLC

[    ]% Senior Secured

Notes due 2011, Series B (the “Notes”)

Issued under the Indenture (the “Indenture”) dated as

as of
                    ,
2004 relating to the Notes

 

Ladies and Gentlemen:

 

This Certificate relates to:

 

[CHECK
A OR B AS APPLICABLE.]

 

o                                    A.                                   Our proposed
purchase of $         principal amount
of Notes issued under the Indenture.

 

o                                    B.                                     Our proposed
exchange of $         principal amount
of Notes issued under the Indenture for an equal principal amount of Notes to
be held by us.

 

We hereby confirm that:

 

1.                                       We
are an institutional “accredited investor” within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the
“Securities Act”) (an “Institutional Accredited Investor”).

 

2.                                       Any
acquisition of Notes by us will be for our own account or for the account of
one or more other Institutional Accredited Investors as to which we exercise
sole investment discretion.

 

3.                                       We
have such knowledge and experience in financial and business matters that we
are capable of evaluating the merits and risks of an investment in the Notes
and we and any accounts for which we are acting are able to bear the economic
risks of and an entire loss of our or their investment in the Notes.

 

4.                                       We
are not acquiring the Notes with a view to any distribution thereof in a
transaction that would violate the Securities Act or the securities laws of any
State of the United States or any other applicable jurisdiction; provided that
the disposition of our property and the property of any accounts for which we
are acting as fiduciary will remain at all times within our and their control.

 

H-1

 

5.                                       We
acknowledge that the Notes have not been registered under the Securities Act
and that the Notes may not be offered or sold within the United States or to or
for the benefit of U.S. persons except as set forth below.

 

We agree for the benefit of the Company, on our own
behalf and on behalf of each account for which we are acting, that such Notes
may be offered, sold, pledged or otherwise transferred only in accordance with
the Securities Act and any applicable securities laws of any State of the
United States and only (a) to the Company, (b) pursuant to a registration
statement which has become effective under the Securities Act, (c) to a
qualified institutional buyer in compliance with Rule 144A under the Securities
Act, (d) in an offshore transaction in compliance with Rule 904 of Regulation S
under the Securities Act, that, prior to such transfer, delivers to the Trustee
a duly completed and signed certificate (the form of which may be obtained from
the Trustee) relating to the restrictions on transfer of the Notes or (f)
pursuant to an exemption from registration provided by Rule 144 under the
Securities Act or any other available exemption from the registration
requirements of the Securities Act.

 

Prior to the registration of any transfer in
accordance with (c) or (d) above, we acknowledge that a duly completed and
signed certificate (the form of which may be obtained from the Trustee) must be
delivered to the Trustee.  Prior to the
registration of any transfer in accordance with (e) or (f) above, we
acknowledge that the Company reserves the right to require the delivery of such
legal opinions, certifications or other evidence as may reasonably be required
in order to determine that the proposed transfer is being made in compliance
with the Securities Act and applicable state securities laws.  We acknowledge that no representation is
made as to the availability of any Rule 144 exemption from the registration
requirements of the Securities Act.

 

We understand that the Trustee will not be required to
accept for registration of transfer any Notes acquired by us, except upon
presentation of evidence satisfactory to the Company and the Trustee that the
foregoing restrictions on transfer have been complied with.  We further understand that the Notes
acquired by us will be in the form of definitive physical certificates and that
such certificates will bear a legend reflecting the substance of the preceding
paragraph.  We further agree to provide
to any person acquiring any of the Notes from us a notice advising such person
that resales of the Notes are restricted as stated herein and that certificates
representing the Notes will bear a legend to that effect.

 

We agree to notify you promptly in writing if any of
our acknowledgments, representations or agreements herein ceases to be accurate
and complete.

 

We represent to you that we have full power to make
the foregoing acknowledgments, representations and agreements on our own behalf
and on behalf of any account for which we are acting.

 

H-2

 

You and the Company are entitled to rely upon this
Certificate and are irrevocably authorized to produce this Certificate or a
copy hereof to any interested party in any administrative or legal proceeding
or official inquiry with respect to the matters covered hereby.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  [NAME OF PURCHASER (FOR
  TRANSFERS)

  OR OWNER (FOR EXCHANGES)]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
  Address:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  	
   

  
					

 

Upon transfer, the Notes would be registered in the
name of the new beneficial owner as follows:

 

	
  By:

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
	
  Taxpayer ID number:

  	
   

  	
   

  
					

 

H-3

 

EXHIBIT I

 

[COMPLETE
FORM I OR FORM II AS APPLICABLE.]

 

[FORM
I]

 

Certificate
of Beneficial Ownership

 

To:                              Wells
Fargo Bank, National Association

                                              

                                              

Attention: Corporate Trust Administration OR

 

[Name of DTC Participant]

 

Re:                               Foster
Wheeler LLC

[    ]% Senior Secured

Notes due 2011, Series B (the “Notes”)

Issued under the Indenture (the “Indenture”) dated as

as of
                    ,
2004 relating to the Notes

 

Ladies and Gentlemen:

 

We are the beneficial owner of
$         principal amount of Notes
issued under the Indenture and represented by an Offshore Global Note (as
defined in the Indenture).

 

We hereby certify as follows:

 

[CHECK
A OR B AS APPLICABLE.]

 

o                                    A.                                   We
are a non-U.S. person (within the meaning of Regulation S under the Securities
Act of 1933, as amended).

 

o                                    B.                                     We
are a U.S. person (within the meaning of Regulation S under the Securities Act
of 1933, as amended) that purchased the Notes in a transaction that did not
require registration under the Securities Act of 1933, as amended.

 

I-1

 

You and the Company are entitled to rely upon this
Certificate and are irrevocably authorized to produce this Certificate or a
copy hereof to any interested party in any administrative or legal proceeding
or official inquiry with respect to the matters covered hereby.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  [NAME OF BENEFICIAL
  OWNER]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
  Address:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  	
   

  
					

 

[FORM II]

 

Certificate of Beneficial Ownership

 

To:                              Wells
Fargo Bank, National Association

                                              

                                              

Attention: Corporate Trust Administration

 

Re:                               Foster
Wheeler LLC

[    ]% Senior Secured

Notes due 2011, Series B (the “Notes”)

Issued under the Indenture (the “Indenture”) dated as

as of
                    ,
2004 relating to the Notes

 

Ladies and Gentlemen:

 

This is to certify that based solely on certifications
we have received in writing or by electronic transmission from institutions
appearing in our records as persons being entitled to a portion of the
principal amount of Notes represented by an Offshore Global Note issued under
the above-referenced Indenture, that as of the date hereof,
$         principal amount of Notes
represented by the Offshore Global Note being submitted herewith for exchange
is beneficially owned by persons that are either (i) non-U.S. persons (within
the meaning of Regulation S under the Securities Act of 1933, as amended) or
(ii) U.S. persons that purchased the Notes in a transaction that did not
require registration under the Securities Act of 1933, as amended.

 

We further certify that (i) we are not submitting
herewith for exchange any portion of such Offshore Global Note excepted in such
certifications and (ii) as of the date hereof we have not received any
notification from any Institution to the effect that the statements made by
such

 

I-2

 

Institution with
respect to any portion of such Offshore Global Note submitted herewith for
exchange are no longer true and cannot be relied upon as of the date hereof.

 

You and the Company are entitled to rely upon this
Certificate and are irrevocably authorized to produce this Certificate or a
copy hereof to any interested party in any administrative or legal proceeding
or official inquiry with respect to the matters covered hereby.

 

 

	
   

  	
  Yours faithfully,

  
	
   

  	
   

  
	
   

  	
  [Name of DTC
  Participant]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
  Address:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
   

  	
   

  
					

 

I-3

 

Exhibit J

 

FORM OF
SUBORDINATED INTERCOMPANY NOTE

 

	
  U.S.
  $             

  	
                           ,  20  

  

 

 

FOR VALUE RECEIVED, the undersigned, [Name], a corporation organized under the
laws of
                        
(the “Maker”),
hereby promises to pay, subject to the subordination provisions set forth below
(the “Subordination
Provisions”), to the order of
[                      ],
a
[                ]
organized under the laws of
                    
(together with any subsequent holder hereof, the “Holder”) the principal sum of
                                                            
AND NO/100 [INSERT CURRENCY]
(                )
[ON DEMAND][not later than [INSERT DATE], unless earlier accelerated], or if
less, the unpaid principal amount of all loans made to the Maker pursuant to
this Intercompany Note.

 

Subject to the Subordination Provisions, the Maker
promises to pay interest on the unpaid principal amount hereof from the date
hereof until such principal amount is paid in full at the rate of
      % per annum (except as provided below upon
the occurrence and during the continuance of an Event of Default under the
Indenture as defined below), payable in the manner hereinafter provided, provided, however, that any amount that is
not paid when due ([whether at stated maturity, by acceleration][upon demand]
or otherwise) shall (to the fullest extent permitted by law) bear interest from
the date when due until paid in full at a rate per annum equal at all times to
    % per annum, payable on demand.

 

Subject to the Subordination Provisions, the Maker may
prepay in whole or in part the outstanding principal amount of this
Intercompany Note, provided that
the Maker will pay on the date of such prepayment all accrued and unpaid
interest due on such prepaid principal amount to the date of prepayment.  The term “Business Day” means a day of the year on
which banks are not required or authorized to close in New York City.

 

All computations of interest will be made by the
Holder on the basis of a year of 360 days for the actual number of days
(including the first day but excluding the last day) occurring in the period
for which such interest is payable. 
Whenever any payment hereunder is stated to be due on a day other than a
Business Day, such payment will be made on the following Business Day.

 

Anything in this
Intercompany Note to the contrary notwithstanding, the indebtedness evidenced
by this any Intercompany Note shall be subordinate and junior in right of
payment in full in cash, to the extent and in the manner hereinafter set forth,
to all indebtedness or other liabilities of the Maker outstanding from time to
time, arising under (x) that certain Indenture dated as of
            
    , 2004, between Foster Wheeler LLC, a Delaware limited
liability company, the guarantors party thereto and Wells Fargo Bank, National
Association, as Trustee (the “Indenture”), and (y) any Credit Facility under
and as defined in the Indenture, including without limitation, in the case of
each of the foregoing clauses (x) and (y), any interest accruing

 

J-1

 

after the commencement of any proceedings referred to in clause (ii)
below, whether or not such interest is an allowed claim in such proceeding (all
such indebtedness or other liabilities and interest being herein called “Senior
Indebtedness”):

 

(i)  The holders of Senior Indebtedness shall be
entitled to receive payment in full in cash of all amounts constituting Senior
Indebtedness before the Holder is entitled to receive any payment on account of
this Intercompany Note, provided that the Maker may make, and the Holder shall
be entitled to receive and retain from time to time, payments and prepayments
in respect of the principal of and interest of this Intercompany Note at any
time except following the occurrence and during the continuance of an Event of
Default under and as defined in the Indenture;

 

(ii)  In the event of any insolvency or bankruptcy
proceedings, and any receivership, liquidation, reorganization or other similar
proceedings in connection therewith, relative to the Maker or to its creditors,
as such, or to its property, and in the event of any proceedings for voluntary
liquidation, dissolution or other winding up of the Maker, whether or not
involving insolvency or bankruptcy, then the holders of Senior Indebtedness
shall be entitled to receive payment in full in cash of all amounts
constituting Senior Indebtedness before the Holder is entitled to receive, or
make any demand for, any payment on account of this Intercompany Note, and to
that end the holders of Senior Indebtedness shall be entitled to receive for
application in payment thereof any payment or distribution of any kind or
character, whether in cash or property or securities; and

 

(iii)  Following the occurrence and during the
continuance of an Event of Default under and as defined in the Indenture, if
any payment or distribution of any character, whether in cash, securities or
other property, in respect of this Intercompany Note shall (despite these
subordination provisions) be received by the Holder before all Senior
Indebtedness shall have been paid in full in cash, such payment or distribution
shall be held in trust for the benefit of, and shall be paid over or delivered
to, the holders of Senior Indebtedness (or their representatives), ratably
according to the respective aggregate amounts remaining unpaid thereon, to the
extent necessary to pay all Senior Indebtedness in full.

 

No present or future holder
of Senior Indebtedness shall be prejudiced in its right to enforce
subordination of this Intercompany Note by any act or failure to act on the
part of the Maker or by any act or failure to act, in good faith on the part of
such holder or any trustee or agent for such holder.

 

The Maker hereby irrevocably submits to the
non-exclusive jurisdiction of
[                  ],
and of the courts (including any appellate court) of the State of New York, in
any action or proceeding arising out of or relating to this Intercompany Note,
and the Maker hereby irrevocably agrees that all claims in respect of such
action or proceeding may be heard and determined in such
[                  ][and]
courts.  The Maker hereby irrevocably
waives, to the fullest extent it may effectively do so, the defense of an
inconvenient forum to the maintenance of such action or proceeding.  The Maker agrees that a final judgment in
any such action or proceeding

 

J-2

 

will be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.

 

Nothing in this Section will affect the right of the
Holder to serve legal process in any other manner permitted by law or affect
the right of the Holder to bring any action or proceeding against the Maker or
its property in the courts of any other jurisdiction.

 

This Intercompany Note will be governed by, and
construed in accordance with, the laws of State of New York, without reference
to conflicts of law principles.

 

IN
WITNESS WHEREOF, the Maker has caused this Intercompany Note
to be executed and delivered by its duly authorized officers as of the date
first above written.

 

 

	
   

  	
  [MAKER]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

J-3

 

Exhibit K

 

FORM OF
UNSUBORDINATED INTERCOMPANY NOTE

 

	
  U.S.
  $             

  	
                           ,  20  

  

 

 

FOR VALUE RECEIVED, the undersigned, [Name], a corporation organized under the
laws of
                        
(the “Maker”),
hereby promises to pay to the order of
[                      ],
a [                ]
organized under the laws of
                    
(together with any subsequent holder hereof, the “Holder”) the principal sum of
                                                            
AND NO/100 [INSERT CURRENCY]
(                )
[ON DEMAND][not later than [INSERT DATE], unless earlier accelerated], or if
less, the unpaid principal amount of all loans made to the Maker pursuant to
this Intercompany Note.

 

The Maker promises to pay interest on the unpaid
principal amount hereof from the date hereof until such principal amount is
paid in full at the rate of       % per annum
(except as provided below upon the occurrence and during the continuance of an
Event of Default under the Indenture as defined below), payable in the manner
hereinafter provided, provided, however,
that any amount that is not paid when due ([whether at stated maturity, by
acceleration][upon demand] or otherwise) shall (to the fullest extent permitted
by law) bear interest from the date when due until paid in full at a rate per
annum equal at all times to     % per annum, payable on
demand.

 

The Maker may prepay in whole or in part the outstanding
principal amount of this Intercompany Note, provided
that the Maker will pay on the date of such prepayment all accrued and unpaid
interest due on such prepaid principal amount to the date of prepayment.  The term “Business Day” means a day of the year on
which banks are not required or authorized to close in New York City.

 

The Maker hereby irrevocably submits to the
non-exclusive jurisdiction of
[                  ],
and of the courts (including any appellate court) of the State of New York, in
any action or proceeding arising out of or relating to this Intercompany Note,
and the Maker hereby irrevocably agrees that all claims in respect of such
action or proceeding may be heard and determined in such
[                  ][and]
courts.  The Maker hereby irrevocably
waives, to the fullest extent it may effectively do so, the defense of an
inconvenient forum to the maintenance of such action or proceeding.  The Maker agrees that a final judgment in
any such action or proceeding will be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.

 

Nothing in this Section will affect the right of the
Holder to serve legal process in any other manner permitted by law or affect
the right of the Holder to bring any action or proceeding against the Maker or
its property in the courts of any other jurisdiction.

 

This Intercompany Note will be governed by, and
construed in accordance with, the laws of the State of New York, without
reference to conflicts of law principles.

 

K-1

 

IN
WITNESS WHEREOF, the Maker has caused this Intercompany Note
to be executed and delivered by its duly authorized officers as of the date
first above written.

 

 

	
   

  	
  [MAKER]

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

K-2

 

EXHIBIT L

 

THIS NOTE IS A TEMPORARY GLOBAL NOTE.  PRIOR TO THE EXPIRATION OF THE RESTRICTED
PERIOD APPLICABLE HERETO, BENEFICIAL INTERESTS HEREIN MAY NOT BE HELD BY ANY
PERSON OTHER THAN (1) A NON-U.S. PERSON OR (2) A U.S. PERSON THAT PURCHASED
SUCH INTEREST IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”).  BENEFICIAL INTERESTS HEREIN ARE NOT EXCHANGEABLE FOR PHYSICAL
NOTES OTHER THAN A PERMANENT GLOBAL NOTE IN ACCORDANCE WITH THE TERMS OF THE
INDENTURE.  TERMS IN THIS LEGEND ARE
USED AS USED IN REGULATION S UNDER THE SECURITIES ACT.

 

L-1Exhibit
4.20

FOSTER WHEELER LTD.

Certificate of Designation

of

Series B Convertible Preferred Shares

1.             Number and Description.  (a) 
The Company’s preferred shares shall include a  series of [                  ]1 preferred shares, which shall be designated
as its Series B Convertible Preferred Shares (the “Preferred Shares”),
par value U.S.$1.00 per share.

(b)           All Preferred Shares shall be denominated in United States
currency, and all payments and distributions thereon or with respect thereto
shall be made in United States currency. 
All references herein to “U.S.$”, “$” or “dollars” refer to United
States currency.

(c)           Preferred Shares may be issued by the Company only on full
payment of the consideration payable therefor, which shall be equal to at least
the par value of U.S.$1.00 per share or such other par value of such Preferred
Shares in effect at the time of issuance, so that all Preferred Shares shall be
issued as fully paid.

2.             Issuance.  The Company may not increase or decrease the number of Preferred
Shares designated as Preferred Shares and may not issue additional Preferred
Shares after the date of first issuance of any Preferred Shares (except, the
Company may issue up to [___] Preferred Shares (the “Warrant Shares”) upon
exercise of the Warrants in accordance with their terms as described below)
which shall be the date the Exchange Offer is consummated (the “Original Issue
Date”) without obtaining the prior written consent of the Holders of
three-quarters of the outstanding Preferred Shares, provided that, to the
extent permitted under the Lock-up Agreement, the Company may issue additional
Preferred Shares up to the full number of Preferred Shares designated in
Section 1(a) less the number of potential Warrant Shares (as defined below) on
the closing date of one subsequent offering period, if any (the “Subsequent
Offering Period”) announced by the Company on the business day following the
expiration date of the Exchange Offer pursuant to which Preferred Shares are
first issued (the “Second Issue Date”).

3.             Conversion.   (a)  Subject to
adjustment pursuant to Section 9, each Preferred Share will become convertible,
at the option of the Holder, into Common Shares on a 1 (one) to [     ] basis (the “Conversion Ratio”) in the
manner specified in this Section 3, subject to and effective immediately upon:
(i) approval of the Par Value Reduction (as defined in Section 3(b)) by the
Members, (ii) approval of the Increase of Capital (as defined in Section 3(b))
by the Members and (iii) approval of the Bonus Issue (as defined in
Section 3(c)) by the Board of Directors, which approval shall be subject to the
approval of the Par Value Reduction and Increase of Capital.

(b)           (i)            As
soon as practicable after the Original Issue Date, the Board of Directors shall
call a general meeting (the “General Meeting”) of all Members entitled to vote
at a general meeting of the Company for the purpose of the Members considering,
and, if thought

 

1  Includes
Preferred Shares issuable upon exercise of the Warrants.

 

fit, effecting and approving (A) a pro rata
reduction of the Share Capital of the Company from US$1.00 par value per share
to US$0.01 par value per share and the transfer of the reduced amount of
US$0.99 per issued share to the Company’s contributed surplus account (the “Par
Value Reduction”), and (B) an increase in the authorized capital of the
Company as reduced by the Par Value Reduction, from US$1,615,000, consisting of
160,000,000 Common Shares, par value US$0.01 each and 1,500,000 preferred
shares, par value US$0.01 each (including the Preferred Shares) to
US$[             ]
by the creation of an additional [          ]
Common Shares, par value US$0.01 each, or to such greater amount and number of
Common Shares as may be necessary to ensure that the Company has sufficient
authorized Common Shares (taking into account any outstanding warrants, options
and similar rights for which Common Shares have been or may be separately
reserved) to fully effect the Conversion of all of the Preferred Shares issued
from time to time on the terms set forth in Section 3 hereof, as adjusted in
accordance with Section 9 hereof, ranking pari passu in all respects with the
existing Common Shares and having the rights and restrictions set out in the
Bye-laws (the “Increase of Capital”) and

(ii)           The Company, at all times following
the Increase of Capital, if any, shall reserve that number of Common Shares
sufficient (taking into account any outstanding warrants, options and similar
rights for which Common Shares have been or may be separately reserved) to
allow the Conversion of all of the issued and outstanding Preferred Shares on
such date.

 

(c)           (1)           On the
date this Certificate of Designation is approved by the authority of the Board
of Directors in final form, the Board of Directors shall resolve, in
substantially the form of Exhibit “A” to this Certificate of Designation (the
“Bonus Resolution”) and subject to the approval of the Par Value Reduction and
the Increase of Capital by the Members, to bonus issue fully paid Common Shares
to the Holders of the Preferred Shares, such Bonus Resolution to be effective
[two Business Days after the Second Issue Date]/[on the Original Issue Date]2 (the “Bonus Issue”), in preference to and to
the exclusion of the holders of Common Shares, by capitalizing an amount of
[US$                ] standing to the
credit of the share premium account of the Company (the “Capitalization”) to
pay up the full nominal value of such number of Common Shares for each of the
Preferred Shares or any fraction thereof as is equal to the Conversion Ratio
less one, or with respect to any fractional Preferred Share, less such fraction
(the “Bonus Issue Shares”), pursuant to Bye-law 64 and Section 40 of the
Companies Act 1981 of Bermuda (the “Act”). 
The issuance of Bonus Issue Shares to any Holder in respect of any Preferred
Shares is subject to and conditional upon the Company having sufficient share
premium (which shall be reserved in the Bonus Resolution) to fully effect the
Capitalization and is further conditional upon the conversion of such Preferred
Share(s) held by such Holder into Common Shares in accordance with this Section
3 (a “Conversion”) in each case.  Such
Bonus Issue Shares may be issued to any one or more Holders in discrimination
to and to the exclusion of any one or more other Holders who have not effected
a Conversion of their Preferred Shares. 
The Capitalization shall be effected and the Bonus Issue Shares shall be
issued, in respect of each Preferred Share or fraction thereof, subject to and
upon a Holder’s delivery to the Company of a Notice of Conversion in respect of
such Preferred Share(s) or fraction thereof in accordance with Section
3(d).  The Company (i) shall not take
any action that would impair, rescind or alter the

2 Select one, as
appropriate.  The effective date will be
determined at the Original Issue Date, after determining whether there will be
a Subsequent Offering Period.

2

 

Bonus Resolution following its adoption as described
in this paragraph (c)(1) and (ii) shall at all times after the Increase of
Capital reserve that number of Common Shares (taking into account any
outstanding warrants, options and similar rights for which Common Shares have
been or may be separately reserved) sufficient to allow, and maintain
sufficient share premium to fully effect, the Bonus Issue.

(2)           From time to time, if and when Warrant Shares are issued
upon exercise of the Warrants, the Board of Directors shall resolve prior to
delivery of such shares, in substantially the form of the Bonus Resolution
(each such resolution, a “Warrant Bonus Resolution”) and subject to the
approval of the Par Value Reduction and the Increase of Capital by the Members,
to bonus issue fully paid Common Shares to the Holders of the Warrant Shares,
each such Warrant Bonus Resolution to be effective as of its date (each a
“Warrant Bonus Issue”), in preference to and to the exclusion of the holders of
Common Shares and the Preferred Shares that are not Warrant Shares, by
capitalizing an amount standing to the credit of the share premium account of
the Company (each an “Additional Capitalization”) to pay up the full nominal
value of such number of Common Shares for each of the Warrant Shares or any
fraction thereof as is equal to the Conversion Ratio less one, or with respect to
any fractional Warrant Share, less such fraction (the “Warrant Bonus Issue
Shares”), pursuant to Bye-law 64 and Section 40 of the Act.  The issuance of Warrant Bonus Issue Shares
to any Holder of Warrant Shares is subject to and conditional upon the Company
having sufficient share premium (which shall be reserved in the Bonus
Resolution) to fully effect the relevant Additional Capitalizations and is
further conditional upon the Conversion of the Warrant Share(s) held by such
Holder into Common Shares in accordance with this Section 3 in each case.  Such Warrant Bonus Issue Shares may be
issued to any one or more Holders in discrimination to and to the exclusion of
any one or more other Holders who have not effected a Conversion of their
Preferred Shares, including, if applicable, their Warrant Shares.  Each Additional Capitalization shall be
effected and the Warrant Bonus Issue Shares shall be issued, in respect of each
Warrant Share or fraction thereof, subject to and upon a Holder’s delivery to
the Company of a Notice of Conversion in respect of such Warrant Share(s) or
fraction thereof in accordance with Section 3(d).  The Company (i) shall not take any action that would impair,
rescind or alter any Warrant Bonus Resolution following its adoption as described
in this paragraph (c)(2) and (ii) shall at all times after the Increase of
Capital reserve that number of Common Shares (taking into account any
outstanding warrants, options and similar rights for which Common Shares have
been or may be separately reserved) sufficient to allow, and maintain
sufficient share premium to fully effect, the Warrant Bonus Issue.

 

(d)           In order to effect a Conversion, a Holder shall deliver
(via facsimile or otherwise) a copy of a fully executed Notice of Conversion,
in the form attached hereto, to the Company at its principal office (Attention:
Secretary). Upon receipt by the Company of a Notice of Conversion, the Company
shall promptly send, via facsimile if possible, a confirmation to such Holder
stating that the Notice of Conversion has been received and the name and
telephone number of a contact person at the Company regarding the Conversion.

(e)           Upon receipt by the Company of the Notice of Conversion
from a Holder and to effect a Conversion of the Holder’s Preferred Shares:

 

3

 

(i)            if the Conversion is of Warrant
Shares, a Warrant Bonus Resolution shall be adopted by the Board of Directors
in accordance with Section 3(c)(2) and the Warrant Bonus Issue Shares in
respect of each Warrant Share or fractional Warrant Share being converted shall
be issued to such Holder as an integral part of the Conversion, and the
Additional Capitalization of the par value of such Warrant Bonus Issue Shares
shall be effected in full and reflected in the Company’s records;

(ii)           if clause (i) does not apply, the
Bonus Issue Shares in respect of each Preferred Share or fractional Preferred
Share being converted shall be issued to such Holder as an integral part of the
Conversion, and the Capitalization of the par value of such Bonus Issue Shares
shall be effected in full and reflected in the Company’s records;

(iii)          simultaneously with and following upon
the actions set forth in (i) and (ii) above, each Preferred Share or fraction
thereof described in such Notice of Conversion will immediately cease to have
the rights and restrictions of a Preferred Share or fraction thereof and each
such Preferred Share will become one fully paid Common Share and each such
fraction of a Preferred Share will become an equal fraction of a Common Share;

(iv)          the Company will reflect the
Conversion in its Register of Members; and

(v)           the Company will pay all stamp and
transfer taxes, if any, payable upon any Conversion provided, however, that (i)
a Holder shall pay any such tax which is due because the Holder requests the
Common Shares issuable in respect of its Preferred Shares upon a Conversion to
be issued in a name other than the Holder’s name, and (ii) the Company (or the
transfer agent) may refuse to issue Common Shares to be issued in a name other
than the Holder’s name until it receives cash from the Holder in an amount
sufficient to pay any tax referred to in (i) above.

(f)            Upon a Conversion of Preferred Shares pursuant to Section
3(e), the relevant Preferred Shares and/or fraction(s) thereof shall no longer
be in existence.  Share certificates
representing the converted Preferred Shares and/or fraction(s) thereof shall be
deemed cancelled if not returned to the Company on or prior to the date of
Conversion for cancellation; provided that a new certificate shall be issued by
the Company for the Common Shares and/or fraction(s) thereof resulting from the
Conversion if requested by a Holder.

4.             Ranking.  For so long as any of the Preferred Shares
remain issued and outstanding the Company may authorize or issue any classes or
series of shares ranking on a parity with or senior to the Preferred Shares as
to dividends, distributions out of contributed surplus or distributions upon
liquidation, winding-up and dissolution of the Company.

5.             Liquidation Preference and Rights.  (a) 
Each Preferred Share shall have a liquidation preference of U.S.$0.01
per share (the “Liquidation Preference”).

(b)           In the event of any
voluntary or involuntary liquidation, dissolution or winding-up of the Company
the Holders shall be entitled to be paid out of the assets of the Company
available for distribution to its
Members an amount in cash equal to the Liquidation Preference before any
distribution shall be made or any assets distributed in respect of the Common
Shares

 

4

 

of the
Company.  Thereafter, the Preferred
Shares shall rank equally with the Common Shares and Holders shall share
equally and ratably with holders of Common Shares in the assets, if any,
remaining after the payment of all of the Company’s debts and liabilities as if
each Preferred Share had been converted into Common Shares in accordance with
the Conversion Ratio prior to such liquidation, dissolution or winding up,
whether or not the Company has sufficient authorized capital to effect such
conversion in accordance with the terms hereof.

6.             Rights
to Dividends, Return of Capital.  (a) Holders are entitled to dividends as set forth in this
Section 6, in each case subject to Section 54 of the Act.  Each Holder shall be entitled to receive,
out of the funds of the Company legally available therefor, dividends,
distributions of contributed surplus or any other distributions on the
Preferred Shares on a pro rata basis if, as and when dividends are declared and
paid, or distributions of contributed surplus or any other distributions are
made, by the Board of Directors on the Common Shares, as though the Preferred
Shares had been converted into Common Shares in accordance with the Conversion
Ratio prior to the declaration and payment of such dividend or the making of
such distribution, whether or not the Company has sufficient authorized capital
to effect such conversion in accordance with the terms hereof.

                (b)           Notwithstanding
any provision of the Act or the Bye-laws which would permit the Company to
return or distribute share capital or other property of the Company to the
holders of Common Shares, upon the Company’s return or distribution of any of
its share capital or of any other property of the Company, in accordance with
applicable law, to any holders of Common Shares, whether by way of a repurchase
of Common Shares, a reduction of issued share capital, a bonus issue of shares
(other than as described under Section 3 hereof) or otherwise (each such event
a “Capital Distribution”) each Holder shall be entitled to receive a pro rata
share of such Capital Distribution, as though the Preferred Shares had been
converted into Common Shares in accordance with the Conversion Ratio prior to the
Capital Distribution, whether or not the Company has sufficient authorized
capital to effect such conversion in accordance with the terms hereof.

(c)           Without limiting the obligations of the Company under the
Lock-up Agreement, within five Business Days following the Original Issue Date
(i) the Board of Directors shall have increased the number of directors from
seven to eight and, until the actions described in clause (iii) of this
paragraph (c) have been taken, the Board of Directors shall not increase the
number of directors to more than eight; (ii) three of the six incumbent
independent directors shall have resigned; and (iii) the continuing members of
the Board of Directors shall have nominated and appointed four directors
proposed by the Holders who are party to the Lock-up Agreement that qualify as
independent directors and are reasonably acceptable to the continuing members
of the Board of Directors.  If the
Company has failed to take any of the actions described in, or takes any action
prohibited under, the first sentence of this paragraph, then on the sixth
Business Day following the Original Issue Date, the Company shall declare and
pay a dividend on the issued and outstanding

 

5

 

Preferred
Shares in the aggregate amount of $2,500,000, in preference to and to the
exclusion of the holders of the Common Shares. 
Thereafter on each quarterly anniversary of the sixth Business Day
following the Original Issue Date that occurs before the Preferred Shares have
become optionally convertible, if the Company has not taken any of the actions
described in, or takes any action prohibited under, clauses (i), (ii) and (iii)
of the first sentence of this paragraph, then the Company shall declare and pay
a dividend on the issued and outstanding Preferred Shares in the aggregate
amount of $2,500,000, in preference to and to the exclusion of the holders of
the Common Shares.  Notwithstanding the
foregoing, the Company shall not be required to declare or pay any dividend under
this paragraph unless the Holders who were party to the Lock-up Agreement have
delivered to the Company the names and resumes of no less than seven potential
nominees that are in each case independent of management and are reasonably
expected to be reasonably acceptable to the continuing members of the Board on
or before the date that is two weeks prior to the date such dividends would
have otherwise been required to be declared and paid.

(d)           Without limiting the obligations of the Company under the
Lock-up Agreement, as soon as practicable following the Original Issue Date and
in any event no later than thirty calendar days thereafter, the Company will
file a preliminary proxy statement with the Securities and Exchange Commission
(the “SEC”) regarding meetings of its shareholders in order to recommend
adoption and approval of the following actions: (A) to authorize a reverse
split (i.e.,
consolidation) of its issued and outstanding Common Shares on a one-to-twenty
basis; provided that such reverse split shall be effective subject to and
following the votes of the Members on the matters set forth in clauses (B) and
(C) hereof, (B) to approve the Par Value Reduction and (C) to increase its
authorized capital sufficient to allow conversion of the Preferred Shares
hereunder (taking into account any outstanding warrants, options and similar
rights for which Common Shares have been or may be separately reserved).  If the Company has failed to file such proxy
statement, then on the thirty-first day following the Original Issue Date, the
Company shall declare and pay a dividend on the issued and outstanding
Preferred Shares in the aggregate amount of $1,000,000, in preference to and to
the exclusion of the holders of the Common Shares.  Thereafter on each quarterly anniversary of the thirty-first day
following the Original Issue Date, if the Company has not filed such proxy
statement, then the Company shall declare and pay a dividend on the issued and
outstanding Preferred Shares in the aggregate amount of $1,000,000, in
preference to and to the exclusion of the holders of the Common Shares.

(e)           Without limiting the obligations of the Company under the
Lock-up Agreement, the Company will mail the proxy statement described in
paragraph (d) above within five  Business
Days following the date that the SEC clears such proxy to be mailed.  If the Company has failed to take the action
described in the first sentence of this paragraph, then on the sixth day
following such clearance date, the Company shall declare and pay a dividend on
the issued and outstanding Preferred Shares in the aggregate amount of
$1,000,000, in preference to and to the exclusion of the holders of the Common
Shares.  Thereafter on each quarterly
anniversary of the sixth day following such clearance date, if the Company has
not mailed such proxy, then the Company shall declare and pay a dividend on the
issued and outstanding Preferred Shares in the aggregate amount of $1,000,000,
in preference to and to the exclusion of the holders of the Common Shares.

                (f)            Without
limiting the obligations of the Company under the Lock-up Agreement, the
Company will convene meetings of its shareholders to approve the actions
described in clauses (A), (B) and (C) of paragraph (d) above on or prior to
November 30, 2004.  If the Company has
failed to take the action described in the first sentence of this paragraph,
then on December 1, 2004, the Company shall declare and pay a dividend on the
issued and outstanding Preferred Shares in the aggregate amount of $2,500,000,
in preference to and to the exclusion of the holders of the Common Shares.  Thereafter on each quarterly anniversary of
December 1, if

 

6

 

the Company has not taken
the action described in the first sentence of this paragraph, then the Company
shall declare and pay a dividend on the issued and outstanding Preferred Shares
in the amount of $2,500,000, in preference to and to the exclusion of the
holders of the Common Shares.

(g)           Without limiting the obligations of the Company under the
Lock-up Agreement, the Company has agreed that it will use its commercially
reasonable best efforts to (i) list the Common Shares on the New York Stock
Exchange or the NASDAQ Stock Market as promptly as practicable; provided that
the Company shall not be obliged to apply for such listing until such time as
it reasonably believes it meets the applicable listing criteria, (ii) to
cooperate to the extent allowed by applicable laws or rules in facilitating the
quotation of the Preferred Shares on the OTC Bulletin Board or, at such time as
the Company meets the applicable listing criteria, to list the Preferred Shares
on the New York Stock Exchange or the NASDAQ Stock Market; provided that the Company
shall not be obligated to apply for such listing until such time as it
reasonably believes it meets the applicable listing criteria and (iii) to
cooperate to the extent allowed by applicable laws or rules in facilitating the
quotation of the Warrants on the OTC Bulletin Board or, at such time as the
Company meets the applicable listing criteria, to list the Warrants on the New
York Stock Exchange or the NASDAQ Stock Market; provided that the Company
shall not be obligated to apply for such listing until such time as it
reasonably believes it meets the applicable listing criteria, in each case as
promptly as practicable if the Preferred Shares do not become convertible on or
prior to November 30, 2004, provided that, after the Preferred Shares have
become convertible, the Company will not apply to list, and if listed, will use
its reasonable best efforts (which in any event shall include any action within
the Company’s control) to promptly delist, the Preferred Shares.  If the Company has failed to use its
commercially reasonable best efforts to take such actions as may be required
under clause (i) of the first sentence of this paragraph, or to cooperate under
clauses (ii) or (iii) of the first sentence of this paragraph as it relates to
listing but not the delisting of the Preferred Shares, then on the 30th
Business Day following the receipt of notice of such failure from the holders
of 25% of the Preferred Shares outstanding, if such failure shall not have been
cured prior to such date, the Company shall declare and pay a dividend on the
issued and outstanding Preferred Shares in the aggregate amount of $1,000,000,
in preference to and to the exclusion of the holders of the Common Shares.  Thereafter on each quarterly anniversary of
the first such payment date, if the Company has not used its commercially
reasonable best efforts to take such actions as may be required under clause
(i) of the first sentence of this paragraph, or to cooperate under clauses (ii)
or (iii) of the first sentence of this paragraph, then the Company shall
declare and pay a dividend on the issued and outstanding Preferred Shares in
the aggregate amount of $1,000,000, in preference to and to the exclusion of
the holders of the Common Shares.

 

(h)           Without limiting the obligations of the Company under the
Lock-up Agreement, the Company has agreed that it will take all steps necessary
to adopt the appropriate amendments to its organizational documents to effect
the actions described in the first sentence of paragraph (d) of this Section 6,
including (A) adopting board resolutions recommending such actions, (B)
distributing timely notice of such meetings to its shareholders, (C) complying
with applicable proxy solicitation requirements as soon as practicable, (D) if
a quorum is not present on a scheduled date of any such meeting, postponing and
reconvening such meeting at least twice and (E) with respect to the action
described in clause (A) of paragraph (d), duly convening and holding a separate
general meeting of the holders of Common Shares.  If the Company has failed

 

7

 

to take such actions as may be required under
the first sentence of this paragraph, then on the 30th Business Day following
receipt of notice of such failure from the holders of 25% of the Preferred
Shares outstanding, if such failure shall not have been cured prior to such
date, the Company shall declare and pay a dividend on the issued and
outstanding Preferred Shares in the aggregate amount of $1,000,000, in
preference to and to the exclusion of the holders of the Common Shares.  Thereafter, on each quarterly anniversary of
the first such payment date, if the Company has failed to take such action as
may be required under the first sentence of this paragraph, then subject to
Section 54 of the Act, the Company shall declare and pay a dividend on the
issued and outstanding Preferred Shares in the aggregate amount of $1,000,000,
in preference to and to the exclusion of the holders of the Common Shares.

 

(i)            Without limiting the obligations of the Company under the
Lock-up Agreement and pursuant to Section 3(c) hereof, the Board of Directors
is required (i) to adopt the Bonus Resolution on the date this Certificate of
Designation is approved in final form, with effect [two Business Days after the
Second Issue Date]/[on the Original Issue Date] and (ii) following its
adoption, the Company is required (x) to refrain from taking any action to
impair, rescind or alter the Bonus Resolution following its adoption in
accordance with Section 3(c) and (y) to at all times after the Increase of
Capital reserve that number of Common Shares (taking into account any
outstanding warrants, options and similar rights for which Common Shares have
been or may be separately reserved) sufficient to allow, and maintain
sufficient share premium to effect, the Bonus Issue.  If the Board of Directors has failed to take the action described
in clause (i), or if the Company has failed to take or to refrain from taking,
as the case may be, the actions described in clause (ii) of the first sentence
of this paragraph, then on the sixth day following its failure, the Company
shall declare and pay a dividend on the issued and outstanding Preferred Shares
in the aggregate amount of $2,500,000, in preference to and to the exclusion of
the holders of the Common Shares. 
Thereafter on each quarterly anniversary of the first such payment date,
if the Board of Directors has not taken the action described in clause (i) (or
refrain from taking the action described in clause (ii)) of the first sentence
of this paragraph, then the Company shall declare and pay a dividend on the
issued and outstanding Preferred Shares in the aggregated amount of $2,500,000,
in preference to and to the exclusion of the holders of the Common Shares.

 

(j)            All dividends payable under this Section shall be
cumulative.  Without limiting any other
rights of the Holders hereunder, or under the Lock-up Agreement (including,
without limitation, the rights to receive dividends payable under this Section
and the right under the Lock-up Agreement to be paid an amount equal to any
dividends not paid as required under this Certificate of Designation), at law
or otherwise, upon the default of the equivalent of six quarterly dividends on
the Preferred Shares, the Holders may, voting as a class, elect at least two
members of the Board of Directors at each Annual General Meeting of the
Company, such right to continue until all dividends payable hereunder have been
paid in full.

 

7.             Voting Rights.  (a)  Prior to the Preferred Shares becoming
convertible, each Holder shall have the number of votes for each Preferred
Share that such Holder would have if that Preferred Share had been converted into
Common Shares in accordance with the Conversion Ratio, whether or not the
Company has sufficient authorized capital to effect such conversion in
accordance with the terms hereof.  Until
the Preferred Shares have become convertible, the

 

8

 

Holders shall vote with the holders of Common Shares
as a single class on all matters brought before the Members of the Company
except as set forth herein or in the Bye-laws or as required under applicable
law and, for greater certainty, shall be entitled to notice of and to attend
and vote at all general meetings of the Company including, without limitation,
the General Meeting.  If and when the
Preferred Shares become convertible at each Holder’s option, they will cease to
vote except as provided in paragraph (b) of this Section 7, or as required by
Bermuda law and as set forth herein.

(b)           Any amendment, alteration or repeal of the terms of the
Memorandum of Association, the Bye-laws, this Certificate of Designation or the
Adopting Resolution or any change in the terms of the Preferred Shares, however
effected (including by merger, amalgamation or scheme of arrangement or similar
reorganization), in each case that would affect the powers, preferences or
rights of the Preferred Shares will require the approval of Holders of at least
three-fourths of the issued and outstanding Preferred Shares consenting or
voting as a separate class.  This
approval can be evidenced either by unanimous consent in writing or by a
resolution passed at a special general meeting of the Holders at which a quorum
consisting of at least two persons holding or representing one-third of the
issued and outstanding Preferred Shares is present.

(c)           Notice of all general meetings of the Company at which the
Holders are entitled to vote and of any special general meeting of the Holders
shall be given by the Company to the Holders in accordance with the provisions
of the Bye-laws relating to notice for general meetings and notice to Members.

8.             Redemption, Pre-emptive Rights and Sinking Fund.   Holders have no redemption, pre-emptive or
sinking fund rights.

9.             Anti-Dilution.  The Conversion Ratio as set forth in Section
3 shall be subject to the following adjustments:

(a)           Share Splits;
Subdivisions; Reverse Splits; Consolidations and Divisions; and Combinations.  If the issued and outstanding Common Shares
are subdivided, split or reclassified into a greater number of Common Shares on
or after the Original Issue Date, the Conversion Ratio in effect at the opening
of business on the day following the day upon which such subdivision, split or
reclassification becomes effective shall be proportionately increased.  Conversely, if the outstanding Common Shares
shall be combined, consolidated and divided or reclassified into a smaller
number of Common Shares, the Conversion Ratio in effect at the opening of
business on the day following the day upon which such combination,
consolidation and division or reclassification becomes effective shall be
proportionately reduced.  Such increase
or reduction, as the case may be, will become effective immediately after the
opening of business on the day following the day upon such subdivision, split,
reclassification or consolidation and division or combination becomes
effective.  Without limiting the
foregoing, the Conversion Ratio and the Bonus Issue for purposes of the
Conversion of the Preferred Shares shall be adjusted in accordance with this
Section 9 if the reverse split (i.e., consolidation) referred to in clause (A)
of Section 6(d) is duly approved by the Members and the holders of the Common
Shares of the Company in accordance with the Bye-laws and Bermuda law.

 

9

 

Notwithstanding anything to the contrary, no
adjustment shall be made under this Section 9 in connection with the Par Value
Reduction.

 

(b)           Reorganization Events.  In the event:

(i)            any consolidation, amalgamation or
merger of the Company with or into another person or of another person with or
into the Company; or

(ii)           any sale, transfer, lease or
conveyance to another person of the assets of the Company as an entirety or
substantially as an entirety; or

(iii)          any reclassification, reorganization
or recapitalization (other than a reclassification to which paragraph (a) of
this Section 9 applies),

(any of subsections (i) -
(iii), a “Reorganization Event”), were to occur after the Original Issue
Date, and pursuant to the terms of such Reorganization Event, shares or other
securities, property or assets of the Company, the resulting company, successor
or transferee or affiliate thereof, or the acquiror or affiliate thereof, or
any other person, or cash are to be received by or distributed to the holders
of Common Shares, then each Holder of Preferred Shares shall be entitled to
receive the number of shares or other securities, property or assets of the
Company, resulting company, successor or transferee or affiliate thereof, or
the acquiror or affiliate thereof, or any other person, or cash received by or
distributable upon or as a result of such Reorganization Event to a holder of
the number of Common Shares into which such Preferred Shares are convertible at
the Conversion Ratio applicable prior to such Reorganization Event whether or
not the Company has sufficient authorized capital to effect such conversion in
accordance with the terms hereof.

In the event of such a
Reorganization Event, the person formed by consolidation or merger or resulting
from amalgamation or the person that acquires the assets of the Company shall
execute and deliver to the transfer agent for the Common Shares an agreement
providing that the Holder of each Preferred Share that remains issued and
outstanding after the Reorganization Event (if any) shall have the rights
provided by this Section 9.  Such
supplemental agreement shall provide for adjustments which, for events
subsequent to the effective date of such supplemental agreement, shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Section 9.  The above provisions of this
subsection (b) shall similarly apply to successive Reorganization Events.

(c)           Notice of Adjustment.  Whenever the Conversion Ratio is adjusted in accordance with this
Section 9, the Company shall: (i) forthwith compute the Conversion Ratio in
accordance with this Section 9 and prepare and transmit to the transfer agent
for the Common Shares an Officer’s Certificate setting forth the adjusted
Conversion Ratio, the method of calculation thereof in reasonable detail, and
the facts requiring such adjustment and upon which such adjustment is based;
and (ii) as soon as practicable following the occurrence of an event that
requires an adjustment to the Conversion Ratio pursuant to this Section 9 (or
if the Company is not aware of such occurrence, as soon as practicable after
becoming so aware), provide a written notice to the Holders of the occurrence
of such event and a statement setting forth in reasonable

 

10

 

detail the method by which the adjustment to the
Conversion Ratio was determined and setting forth the adjusted Conversion
Ratio.

10.                               Definitions;
Construction.

(a)           Definitions. 
The following terms, as used herein, have the following meanings:

“Act” has the meaning
set forth in Section 3(c).

“Additional
Capitalization” has the meaning set forth in Section 3(c).

“Adopting Resolution”
means the resolution or resolutions of the Board of Directors adopting this
Certificate of Designation.

“Board of Directors”
has the same meaning as the definition of the Board set forth in Bye-law
1(1)(i) of the Bye-laws.

“Bonus Issue” has the
meaning set forth in Section 3(c).

“Bonus Issue Shares”
has the meaning set forth in Section 3(c).

“Bonus Resolution”
has the meaning set forth in Section 3 (c).

“Business Day” means
any day excluding Saturday, Sunday or any day that shall be a federal holiday,
in the City of New York a legal holiday, or a day on which banking institutions
are authorized or required by law or other governmental actions to close.

“Bye-laws” means the
bye-laws of the Company as amended from time to time.

“Capital Distribution”
has the meaning set forth in Section 6(b).

“Capitalization” has
the meaning set forth in Section 3(c).

“Common Shares” means
common shares of the Company, par value US$1.00 per share, or such other par
value of such shares in effect at the time of issuance of such Common Shares.

“Company” means
Foster Wheeler Ltd.

“Conversion” has the
meaning set forth in Section 3(c).

“Conversion Ratio”
has the meaning set forth in Section 3(a).

“Exchange Offer” has
the meaning set forth in the Lock-up Agreement.

“General Meeting” has
the meaning set forth in Section 3(b).

“Holder” means each
person who is entered in the register of members of the Company as the holder
of one or more Preferred Shares (including, if applicable, any issued and
outstanding Warrant Shares).

 

11

 

“Increase of Capital”
has the meaning set forth in Section 3(b).

“Liquidation Preference”
has the meaning set forth in Section 5(a).

“Lock-up Agreement”
means the Lock-up Agreement dated _________, 2004 among the Company, Foster
Wheeler LLC, a Delaware limited liability company, and the security holders
party thereto.

“Members” has the
meaning set forth in Bye-law 1(1)(w) of the Bye-laws and includes the Holders.

“Memorandum of
Association” means the Company’s memorandum of association, as amended from
time to time.

“Notice of Conversion”
shall mean a notice in the form annexed hereto.

“Officer’s Certificate”
means a certificate executed by a duly appointed and authorized officer of the
Company.

“Original Issue Date”
has the meaning set forth in Section 2.

“Par Value Reduction”
has the meaning set forth in Section 3(b).

“person” means an
individual or a company, partnership, trust, incorporated or unincorporated
association, joint venture, joint stock company, limited liability company, government
(or any agency or political subdivision thereof) or other entity of any kind.

“Preferred Shares”
has the meaning set forth in Section 1.

“Reorganization Event”
has the meaning set forth in Section 9(b).

“SEC” has the meaning
set forth in Section 6(d).

“Second Issue Date”
has the meaning set forth in Section 2.

“Share Capital” means
all of the authorized common shares and preferred shares of the Company,
whether or not issued.

“Share Premium Account”
has the meaning set forth in Section 40(1) of the Act.

“Subsequent Offering
Period” has the meaning set forth in Section 2.

“Warrant Bonus Issue”
has the meaning set forth in Section 3(c).

“Warrant Bonus Issue
Shares” has the meaning set forth in Section 3(c).

“Warrant Bonus Resolution”
has the meaning set forth in Section 3(c).

 

12

 

“Warrants” means the
warrants issued under the Warrant Agreement dated as of _______ between the
Company and Mellon Investor Services LLC, as Warrant Agent, and the options issued
to management of the Company under the Company’s 2004 Stock Option Plan, in
each case in connection with the Exchange Offer.

“Warrant Shares” has
the meaning set forth in Section 2.

(b)           Rules of Construction.  The definitions in Section 10 shall apply equally to both the
singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms.  The words “include”, “includes” and “including”
shall be deemed to be followed by the phrase “without limitation.”  References to “Sections” are references to
Sections of this Certificate of Designation unless otherwise stated.

(c)           References. 
Unless the context shall otherwise require, all references herein to (i)
persons include their respective permitted successors and assigns or, in the
case of governmental persons, persons succeeding to the relevant functions of
such persons, (ii) agreements and other contractual instruments include
subsequent amendments, assignments and other modifications thereto to the date
hereof and thereafter, but in the case of any amendment, assignment or
modification after the date hereof, only to the extent such amendments,
assignments or other modifications thereto are not prohibited by their terms,
(iii) statutes and related regulations include any amendments of same and any
successor statutes and regulations and (iv) time shall be deemed to be to New
York City, New York, U.S.A. time.

11.          No
Impairment.  The Company
will not do any act or thing, whether by amendment of this Certificate of
Designation or through any reorganization, recapitalization, transfer of
assets, consolidation, merger or amalgamation, dissolution, issue or sale of
securities or any other voluntary action, to avoid or to seek to avoid the
observance or performance of any of the terms to be observed or performed
hereunder by the Company.

12.          Bye-Laws.  This Certificate of Designation is adopted
pursuant to Section 44(3) of the Bye-laws and shall be attached to and read in
conjunction with the Bye-Laws.

13.          Register
of Members.  The Company
shall maintain a current register of members in which the Holders from time to
time shall be entered in accordance with the Act.

 

13

 

ANNEX

NOTICE OF
CONVERSION

(To
be executed by the registered Holder in order to convert the

Series B Convertible Preferred Shares)

To:
         Foster Wheeler Ltd.

                The undersigned hereby
irrevocably elects to convert (the “Conversion”) ___________ Series B
Convertible Preferred Shares of Foster Wheeler Ltd. (the “Company”) into common
shares of the Company (the “Common Shares”), in accordance with the provisions
of the Certificate of Designation of Series B Convertible Preferred Shares, as
of the date such notice is delivered to the Company or such later date as is
written below.  If securities are to be
issued in the name of a person other than the undersigned, the undersigned will
pay all transfer taxes payable with respect thereto.

It
is understood that each holder of a Preferred Share (or fraction thereof) will
receive that number of Common Shares and/ or fraction(s) thereof equal to the
Conversion Ratio, as adjusted in accordance with Section 9 of the Certificate
of Designation, and if not, this Notice of Conversion shall not be effective.

Except
as provided below, the Company shall electronically issue the Common Shares
and/ or fraction(s) thereof issuable pursuant to the Conversion to the account
of the undersigned or its nominee (which is ____________) with DTC through its
Deposit Withdrawal Agent Commission System (“DTC Transfer”).

o            In lieu of receiving the Common Shares and/ or
fraction(s) thereof issuable pursuant to the Conversion by way of DTC Transfer,
the undersigned hereby requests that the Company issue the Common Shares and/
or fraction(s) thereof to the undersigned and deliver to the undersigned
physical certificates representing such Common Shares and/ or fraction(s)
thereof.

	
   

  	
   

  	
  Date of Conversion:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Signature:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Address:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  

 

 

14

 

Exhibit
“A”

 

FORM OF

FOSTER WHEELER LTD.

UNANIMOUS WRITTEN CONSENT OF THE
BOARD OF DIRECTORS3

 

The Undersigned, being all of the members of
the Board of Directors (the “Board”) of Foster Wheeler Ltd., a company
incorporated and existing under the laws of Bermuda (the “Company”), hereby
consent to and unanimously adopt the following resolutions and hereby direct
that this Unanimous Written Consent be filed with the minutes of the proceedings
of the Board.

 

W H E R E A S:

 

1.                                       The Company has
undertaken an exchange offer (the “Exchange Offer”) as described in
Registration Statements filed on Form S-4 (the “Registration Statement”) dated
[                                                             ]
2004, approved by the Board and filed by the Company and certain of its
subsidiaries with the US Securities and Exchange Commission (the “SEC”) under
the U.S. Securities Act of 1933, as amended and declared effective by the SEC
on [              ], 2004.

 

2.                                       Pursuant to the
terms of the Exchange Offer, inter alia, the Company has designated a
series of its preferred shares as Series B Convertible Preferred Shares, the
terms of which (the “Terms”) are set forth in the form of Certificate of
Designation (the “Certificate of Designation”) filed as Exhibit 4.20 to the
Registration Statement (the “Preferred Shares” which term includes any fraction
of such a share) and the Company has issued [                           ]
of the Preferred Shares and Warrants (as defined in the Certificate of
Designation) to purchase ___ of the Preferred Shares.

 

3.                                       The Terms
require the Company to: (i) convene a general meeting of its shareholders in
order to (A) reduce its authorized capital in respect of each share, whether or
not issued, from US$1.00 to US$0.01 per share and transfer the reduced amount
of US$0.99 per issued share to its contributed surplus account (the “Par
Value Reduction”) and (B) increase its authorized capital to include at
least [                     ] additional
US$0.01 par value common shares of the Company (the “Increase of Capital”); and
(ii) subject to the Par Value Reduction and the Increase of Capital, to approve
the Bonus Issue (as defined below).

 

4.                                       In accordance
with the Terms and subject to the Par Value Reduction and the Increase of
Capital, effective [two Business Days (as defined in the Certificate of
Designation) following the Second Issue Date]/[on the Original Issue Date (as
defined in the

 

3 Note the Warrant Bonus Resolution will omit the
unnecessary portions of this form of resolution, as appropriate.

 

15

 

Certificate of Designation)]
(the “Effective Date”), the Board desires to bonus issue fully paid common
shares of the Company to the holders of the issued and outstanding Preferred
Shares (the “Holders”) following the Par Value Reduction and the Increase of
Capital (the “Bonus Issue”), by capitalizing an amount standing to the credit
of the share premium account of the Company (the “Capitalization”) sufficient
to pay up the full nominal value of that number of common shares of US$.01 par
value each of the Company issuable upon conversion of Preferred Shares in
accordance with the Conversion Ratio (as defined in the Certificate of
Designation) less one, or with respect to any fractional Preferred
Share, less such fraction, for each of the Preferred Shares (the “Bonus Issue
Shares”), pursuant to Bye-law 64 of the Bye-laws of the Company and Section 40
of the Companies Act 1981 of Bermuda (the “Act”), the Bonus Issue Shares to be
issued, in the case of each Preferred Share, to the Holder subject to and upon
such Holder’s delivery to the Company of a Notice of Conversion (as defined in
the Certificate of Designation) in respect of such Preferred Share(s) in
accordance with the Terms and for the purpose of a Conversion (as defined in the
Certificate of Designation) of such Preferred Share(s).

 

5.                                       The issuance of
the Bonus Issue Shares shall be subject to and conditional upon the Conversion
of the Preferred Shares by the Holder in each case, and the Bonus Issue Shares
may be issued to any one or more Holders, on Conversion (as defined in the
Certificate of Designation) of the Preferred Shares of such Holder, in
discrimination to and to the exclusion of any one or more other Holders who
have not effected such Conversion of their Preferred Shares.  The Bonus Issue shall be made to the Holders
in preference to and to the exclusion of the holders of common shares of the
Company.

 

6.                                       The
anti-dilution provisions set forth in Section 9 of the Certificate of
Designation shall apply to the Bonus Issue Shares.

 

RESOLVED
that:

 

1.               Subject to the
Par Value Reduction and the Increase of Capital, which the Board hereby
recommends, the Bonus Issue and the Capitalization be and are hereby approved
with effect from the Effective Date, pursuant to which the Bonus Issue Shares
will be issued to each Holder subject to and upon such Holder’s delivery to the
Company of a Notice of Conversion (as defined in the Certificate of
Designation) in respect of such Holder’s Preferred Share(s) in accordance with
the Terms;

 

2.               the issuance of the Bonus
Issue Shares is subject to and conditional upon the Conversion of the Preferred
Shares in each case, and the Bonus Issue Shares shall be issued to any one or
more Holders in discrimination to and to the exclusion of any one or more other
Holders who have not effected such Conversion of their Preferred Shares, and
the Bonus Issue shall be made to the Holders in preference to and to the
exclusion of the holders of common shares of the Company;

 

3.               such amount standing to the
credit of the share premium account of the Company as is sufficient to pay up
the full nominal value of all Bonus Issue Shares and Warrant Bonus

 

16

 

Issue
Shares (as defined in the Certificate of Designation) be and is hereby reserved
for purposes of the Capitalization;

 

4.               subject to the Increase of
Capital, that number of common shares of the Company equal to the Bonus Issue
Shares plus that number of common shares of the Company issuable upon exercise
of the Warrants (as defined in the Certificate of Designation) be and are
hereby reserved for issuance as the Bonus Issue Shares and the Warrant Bonus
Issue Shares, as applicable upon Conversion of the Preferred Shares in
accordance with the Terms; and

 

5.               the anti-dilution provisions
set forth in section 9 of the Certificate of Designation shall apply to the
Bonus Issue Shares.

 

17

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